BILL ANALYSIS Ó
SB 1095
Page 1
SENATE THIRD READING
SB 1095 (Rubio)
As Amended August 6, 2012
Majority vote
SENATE VOTE :35-0
BUSINESS & PROFESSIONS 9-0 HEALTH
13-0
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|Ayes:|Hayashi, Bill Berryhill, |Ayes:|Monning, Logue, Atkins, |
| |Allen, Butler, Eng, | |Eng, Garrick, Gordon, |
| |Hagman, Hill, Ma, Smyth | |Hayashi, |
| | | |Roger Hernández, Bonnie |
| | | |Lowenthal, Mansoor, |
| | | |Mitchell, Nestande, Pan |
|-----+--------------------------+-----+--------------------------|
| | | | |
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APPROPRIATIONS 17-0
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|Ayes:|Gatto, Harkey, | | |
| |Blumenfield, Bradford, | | |
| |Charles Calderon, Campos, | | |
| |Davis, Donnelly, Fuentes, | | |
| |Hall, Hill, Cedillo, | | |
| |Mitchell, Nielsen, Norby, | | |
| |Solorio, Wagner | | |
| | | | |
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SUMMARY : Authorizes outpatient settings and ambulatory
surgical centers (ASCs) to purchase drugs at wholesale for
administering and dispensing to their patients. Specifically,
this bill :
1)Revises and recasts the authorization for the Board of
Pharmacy (Board) to issue a license for the wholesale purchase
of drugs to a "surgical clinic," to instead refer to the
license being issued to a "clinic," and defines "clinic" to
mean any of the following:
a) A surgical clinic licensed pursuant to state Health and
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Safety Code;
b) An outpatient setting accredited by an accreditation
agency, as defined in state Health and Safety Code; or,
c) An ASC certified to participate in the Medicare Program
pursuant to federal law.
2)Deletes a provision stating that no clinic shall operate
without a license issued by the Board, but retains provisions
requiring a clinic to be licensed by the Board in order to be
entitled to purchase drugs at wholesale, and allowing the
Board to inspect those clinics at any time in order to
determine whether a clinic is operating in compliance with the
law.
3)Specifies that the provisions above shall not limit the
ability of a physician and surgeon or a group medical practice
to prescribe, dispense, administer, or furnish drugs at a
clinic, as specified.
4)Requires agencies that accredit outpatient settings to provide
specified information to the Board within 10 days after the
adoption of a plan of correction for a notice of deficiencies,
and within 24 hours if an outpatient setting has been issued a
reprimand, if the outpatient setting's certificate of
accreditation has been suspended or revoked, or if the
outpatient setting has been placed on probation.
5)Makes conforming changes.
EXISTING LAW :
1)Provides for the licensure and regulation of the practice of
pharmacy under the Pharmacy Law by the Board within the
Department of Consumer Affairs and authorizes the Board to
issue a license to a surgical clinic to purchase drugs to
administer or dispense to the clinic's patients, as specified.
2)Authorizes a licensed surgical clinic to purchase drugs at
wholesale prices to administer or dispense to its patients,
limits the administration or dispensing of surgical clinic
drugs to drugs that control pain and nausea, and prohibits
drugs from being dispensed in amounts greater than that
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required to meet the patient's needs for 72 hours.
3)Authorizes surgical clinics to purchase and distribute such
drugs only after being licensed to do so by the Board and
requires these surgical clinics to notify the Board of any
proposed changes in ownership or beneficial interest, as
specified.
4)Authorizes the Board to inspect a clinic at any time in order
to determine the clinic's compliance with the law.
5)Requires surgical clinics to be licensed and certified by the
Department of Public Health (DPH) and defines a surgical
clinic as a clinic that is not part of a hospital and provides
ambulatory surgical care for patients who remain less than 24
hours.
6)Defines an outpatient setting as any facility, clinic, office,
or other setting that is not part of a general acute care
hospital, where anesthesia is used in compliance with the
community standard of practice.
7)Prohibits the operation of an outpatient setting, including a
surgical clinic, unless the setting is licensed by DPH,
certified to participate in the Medicare program, as
specified, or accredited by an accreditation agency approved
by the Medical Board of California (MBC).
8)Requires the MBC to adopt standards for accreditation of
outpatient settings, as defined, and to ensure that an
accrediting agency's certification program shall, at a
minimum, include standards for specified aspects of the
outpatient setting's operations.
9)Defines an ASC as an ambulatory surgical center certified to
participate in the Medicare Program under Title XVIII of the
federal Social Security Act.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Estimated increased revenue to the Board of Pharmacy of
$180,000 in 2013, and $113,000 annually in subsequent years,
from initial and renewal limited pharmacy license fees.
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2)Annual costs of $164,000 (fee-supported special fund) for one
pharmacy inspector position to handle additional inspection
workload.
COMMENTS : According to the author, "In 2007, the California
Court of Appeal ruled in Capen v. Shewry to prohibit DPH from
licensing ASCs that are either partially or fully owned by a
physician, even if the physician-owned ASC is properly
accredited and Medicare certified. Without proper licensure
from DPH, the Board cannot grant the ASC a license to purchase
medications wholesale.
"Current law is problematic because approximately 90% of ASCs
have some type of physician ownership. As a result of the Capen
v. Shewry decision, physicians that own ASCs incur a significant
liability by having to purchase drugs at retail prices. This
bill provides physician-owned ASCs the proper licensing
necessary to administer high quality care by allowing them to
purchase certain drugs wholesale and store them on site."
Analysis Prepared by : Angela Mapp / B.,P. & C.P. / (916)
319-3301
FN: 0004983