Amended in Senate July 8, 2013

Amended in Assembly April 23, 2013

Amended in Assembly March 21, 2013

California Legislature—2013–14 Regular Session

Assembly BillNo. 1008


Introduced by Assembly Memberbegin delete Torresend deletebegin insert Buchananend insert

February 22, 2013


An act to amend Sectionbegin delete 69841 of the Governmentend deletebegin insert 101850 of the Health and Safetyend insert Code, relating tobegin delete courtsend deletebegin insert health careend insert.

LEGISLATIVE COUNSEL’S DIGEST

AB 1008, as amended, begin deleteTorresend delete begin insertBuchananend insert. begin deleteCivil procedure: judges. end deletebegin insertAlameda County Medical Center: privatization of services.end insert

begin insert

Existing law authorizes the board of supervisors of Alameda County to establish an independent hospital authority strictly and exclusively dedicated to the management, administration, and control of the Alameda Medical Center, and sets forth the powers and duties of the hospital authority, including, but not limited to, the power to contract for services required to meet its obligations.

end insert
begin insert

This bill would prohibit the hospital authority from privatizing any work performed as of March 31, 2013, by physicians and surgeons employed by the authority without clear and convincing evidence that the needed medical care can only be delivered cost-effectively by a private contractor. The bill would require that the authority, prior to privatization of any of those services, negotiate with the representative of its physician and surgeon employees over the decision to privatize, and would require unresolved disputes to be submitted to final binding arbitration.

end insert
begin insert

This bill would make legislative findings and declarations as to the necessity of a special statute for resolving the unique needs faced by the county with respect to the operation and administration of the medical center.

end insert
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Existing law requires the clerk of the superior court to attend each session of the superior court in the county and upon the judges of the court in chambers when required. Existing law authorizes a judge to perform any act required or permitted to be performed by a clerk of the court.

end delete
begin delete

This bill would provide that the above-described requirements of a court clerk are required notwithstanding the latter provision.

end delete

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 101850 of the end insertbegin insertHealth and Safety Codeend insertbegin insert is
2amended to read:end insert

3

101850.  

The Legislature finds and declares the following:

4(a) (1) Due to the challenges facing the Alameda County
5Medical Center arising from changes in the public and private
6health industries, the Alameda County Board of Supervisors has
7determined that a transfer of governance of the Alameda County
8Medical Center to an independent governing body, a hospital
9authority, is needed to improve the efficiency, effectiveness, and
10economy of the community health services provided at the medical
11center. The board of supervisors has further determined that the
12creation of an independent hospital authority strictly and
13exclusively dedicated to the management, administration, and
14control of the medical center, in a manner consistent with the
15county’s obligations under Section 17000 of the Welfare and
16Institutions Code, is the best way to fulfill its commitment to the
17medically indigent, special needs, and general populations of
18Alameda County. To accomplish this, it is necessary that the board
19of supervisors be given authority to create a hospital authority.
20Because there is no general law under which this authority could
21be formed, the adoption of a special act and the formation of a
22special authority is required.

23(2) The following definitions shall apply for purposes of this
24section:

P3    1(A) “The county” means the County of Alameda.

2(B) “Governing board” means the governing body of the hospital
3authority.

4(C) “Hospital authority” means the separate public agency
5established by the Board of Supervisors of Alameda County to
6manage, administer, and control the Alameda County Medical
7Center.

8(D) “Medical center” means the Alameda County Medical
9Center.

10(b) The board of supervisors of the county may, by ordinance,
11establish a hospital authority separate and apart from the county
12for the purpose of effecting a transfer of the management,
13administration, and control of the medical center in accordance
14with Section 14000.2 of the Welfare and Institutions Code. A
15hospital authority established pursuant to this chapter shall be
16strictly and exclusively dedicated to the management,
17administration, and control of the medical center within parameters
18set forth in this chapter, and in the ordinance, bylaws, and contracts
19adopted by the board of supervisors which shall not be in conflict
20with this chapter, Section 1442.5 of this code, or Section 17000
21of the Welfare and Institutions Code.

22(c) A hospital authority established pursuant to this chapter shall
23be governed by a board that is appointed, both initially and
24continually, by the Board of Supervisors of the County of Alameda.
25This hospital authority governing board shall reflect both the
26expertise necessary to maximize the quality and scope of care at
27the medical center in a fiscally responsible manner and the diverse
28interest that the medical center serves. The enabling ordinance
29shall specify the membership of the hospital authority governing
30board, the qualifications for individual members, the manner of
31appointment, selection, or removal of governing board members,
32their terms of office, and all other matters that the board of
33supervisors deems necessary or convenient for the conduct of the
34hospital authority’s activities.

35(d) The mission of the hospital authority shall be the
36 management, administration, and other control, as determined by
37the board of supervisors, of the group of public hospitals, clinics,
38and programs that comprise the medical center, in a manner that
39ensures appropriate, quality, and cost-effective medical care as
40required of counties by Section 17000 of the Welfare and
P4    1Institutions Code, and, to the extent feasible, other populations,
2including special populations in Alameda County.

3(e) The board of supervisors shall adopt bylaws for the medical
4center that set forth those matters related to the operation of the
5medical center by the hospital authority that the board of
6supervisors deems necessary and appropriate. The bylaws shall
7become operative upon approval by a majority vote of the board
8of supervisors. Any changes or amendments to the bylaws shall
9be by majority vote of the board of supervisors.

10(f) The hospital authority created and appointed pursuant to this
11section is a duly constituted governing body within the meaning
12of Section 1250 and Section 70035 of Title 22 of the California
13Code of Regulations as currently written or subsequently amended.

14(g) Unless otherwise provided by the board of supervisors by
15way of resolution, the hospital authority is empowered, or the
16board of supervisors is empowered on behalf of the hospital
17authority, to apply as a public agency for one or more licenses for
18the provision of health care pursuant to statutes and regulations
19governing licensing as currently written or subsequently amended.

20(h) In the event of a change of license ownership, the governing
21body of the hospital authority shall comply with the obligations
22of governing bodies of general acute care hospitals generally as
23set forth in Section 70701 of Title 22 of the California Code of
24Regulations, as currently written or subsequently amended, as well
25as the terms and conditions of the license. The hospital authority
26shall be the responsible party with respect to compliance with these
27obligations, terms, and conditions.

28(i) (1) Any transfer by the county to the hospital authority of
29the administration, management, and control of the medical center,
30whether or not the transfer includes the surrendering by the county
31of the existing general acute care hospital license and corresponding
32application for a change of ownership of the license, shall not
33affect the eligibility of the county, or in the case of a change of
34license ownership, the hospital authority, to do any of the
35following:

36(A) Participate in, and receive allocations pursuant to, the
37California Healthcare for the Indigent Program (CHIP).

38(B) Receive supplemental reimbursements from the Emergency
39Services and Supplemental Payments Fund created pursuant to
40Section 14085.6 of the Welfare and Institutions Code.

P5    1(C) Receive appropriations from the Medi-Cal Inpatient Payment
2Adjustment Fund without relieving the county of its obligation to
3make intergovernmental transfer payments related to the Medi-Cal
4Inpatient Payment Adjustment Fund pursuant to Section 14163 of
5the Welfare and Institutions Code.

6(D) Receive Medi-Cal capital supplements pursuant to Section
714085.5 of the Welfare and Institutions Code.

8(E) Receive any other funds that would otherwise be available
9to a county hospital.

10(2) Any transfer described in paragraph (1) shall not otherwise
11disqualify the county, or in the case of a change in license
12ownership, the hospital authority, from participating in any of the
13following:

14(A) Other funding sources either specific to county hospitals or
15county ambulatory care clinics or for which there are special
16provisions specific to county hospitals or to county ambulatory
17care clinics.

18(B) Funding programs in which the county, on behalf of the
19medical center and the Alameda County Health Care Services
20Agency, had participated prior to the creation of the hospital
21authority, or would otherwise be qualified to participate in had the
22hospital authority not been created, and administration,
23management, and control not been transferred by the county to the
24hospital authority, pursuant to this chapter.

25(j) A hospital authority created pursuant to this chapter shall be
26a legal entity separate and apart from the county and shall file the
27statement required by Section 53051 of the Government Code.
28The hospital authority shall be a government entity separate and
29apart from the county, and shall not be considered to be an agency,
30division, or department of the county. The hospital authority shall
31not be governed by, nor be subject to, the charter of the county
32and shall not be subject to policies or operational rules of the
33county, including, but not limited to, those relating to personnel
34and procurement.

35(k) (1) Any contract executed by and between the county and
36the hospital authority shall provide that liabilities or obligations
37of the hospital authority with respect to its activities pursuant to
38the contract shall be the liabilities or obligations of the hospital
39authority, and shall not become the liabilities or obligations of the
40county.

P6    1(2) Any liabilities or obligations of the hospital authority with
2respect to the liquidation or disposition of the hospital authority’s
3assets upon termination of the hospital authority shall not become
4the liabilities or obligations of the county.

5(3) Any obligation of the hospital authority, statutory,
6contractual, or otherwise, shall be the obligation solely of the
7hospital authority and shall not be the obligation of the county or
8the state.

9(l) (1) Notwithstanding any other provision of this section, any
10transfer of the administration, management, or assets of the medical
11center, whether or not accompanied by a change in licensing, shall
12not relieve the county of the ultimate responsibility for indigent
13care pursuant to Section 17000 of the Welfare and Institutions
14Code or any obligation pursuant to Section 1442.5 of this code.

15(2) Any contract executed by and between the county and the
16hospital authority shall provide for the indemnification of the
17county by the hospital authority for liabilities as specifically set
18forth in the contract, except that the contract shall include a
19provision that the county shall remain liable for its own negligent
20acts.

21(3) Indemnification by the hospital authority shall not be
22construed as divesting the county from its ultimate responsibility
23for compliance with Section 17000 of the Welfare and Institutions
24Code.

25(m) Notwithstanding the provisions of this section relating to
26the obligations and liabilities of the hospital authority, a transfer
27of control or ownership of the medical center shall confer onto the
28hospital authority all the rights and duties set forth in state law
29with respect to hospitals owned or operated by a county.

30(n) (1) A transfer of the maintenance, operation, and
31management or ownership of the medical center to the hospital
32authority shall comply with the provisions of Section 14000.2 of
33the Welfare and Institutions Code.

34(2) A transfer of maintenance, operation, and management or
35ownership to the hospital authority may be made with or without
36the payment of a purchase price by the hospital authority and
37otherwise upon the terms and conditions that the parties may
38mutually agree, which terms and conditions shall include those
39found necessary by the board of supervisors to ensure that the
P7    1transfer will constitute an ongoing material benefit to the county
2and its residents.

3(3) A transfer of the maintenance, operation, and management
4to the hospital authority shall not be construed as empowering the
5hospital authority to transfer any ownership interest of the county
6in the medical center except as otherwise approved by the board
7of supervisors.

8(o) The board of supervisors shall retain control over the use of
9the medical center physical plant and facilities except as otherwise
10specifically provided for in lawful agreements entered into by the
11board of supervisors. Any lease agreement or other agreement
12between the county and the hospital authority shall provide that
13county premises shall not be sublet without the approval of the
14board of supervisors.

15(p) The statutory authority of a board of supervisors to prescribe
16rules that authorize a county hospital to integrate its services with
17those of other hospitals into a system of community service that
18offers free choice of hospitals to those requiring hospital care, as
19set forth in Section 14000.2 of the Welfare and Institutions Code,
20shall apply to the hospital authority upon a transfer of maintenance,
21operation, and management or ownership of the medical center by
22the county to the hospital authority.

23(q) The hospital authority shall have the power to acquire and
24possess real or personal property and may dispose of real or
25personal property other than that owned by the county, as may be
26necessary for the performance of its functions. The hospital
27authority shall have the power to sue or be sued, to employ
28personnel, and to contract for services required to meet its
29obligations.begin insert The hospital authority shall not privatize any work
30performed as of March 31, 2013, by physicians and surgeons
31employed by the authority without clear and convincing evidence
32that the needed medical care can only be delivered cost-effectively
33by a private contractor. Prior to privatization of any of those
34services, the authority shall negotiate with the representative of
35its physician and surgeon employees over the decision to privatize
36and, if unable to resolve any dispute through negotiations, shall
37submit the matter to final binding arbitration.end insert

38(r) Any agreement between the county and the hospital authority
39shall provide that all existing services provided by the medical
40center shall continue to be provided to the county through the
P8    1medical center subject to the policy of the county and consistent
2with the county’s obligations under Section 17000 of the Welfare
3and Institutions Code.

4(s) A hospital authority to which the maintenance, operation,
5and management or ownership of the medical center is transferred
6shall be a “district” within the meaning set forth in the County
7Employees Retirement Law of 1937 (Chapter 3 (commencing with
8Section 31450) of Part 3 of Division 4 of Title 3 of the Government
9Code). Employees of a hospital authority are eligible to participate
10in the County Employees Retirement System to the extent
11permitted by law.

12(t) Members of the governing board of the hospital authority
13shall not be vicariously liable for injuries caused by the act or
14omission of the hospital authority to the extent that protection
15applies to members of governing boards of local public entities
16generally under Section 820.9 of the Government Code.

17(u) The hospital authority shall be a public agency subject to
18the Myers-Milias-Brown Act (Chapter 10 (commencing with
19Section 3500) of Division 4 of Title 1 of the Government Code).

20(v) Any transfer of functions from county employee
21classifications to a hospital authority established pursuant to this
22section shall result in the recognition by the hospital authority of
23the employee organization that represented the classifications
24performing those functions at the time of the transfer.

25(w) (1) In exercising its powers to employ personnel, as set
26forth in subdivision (p), the hospital authority shall implement,
27and the board of supervisors shall adopt, a personnel transition
28plan. The personnel transition plan shall require all of the
29following:

30(A) Ongoing communications to employees and recognized
31employee organizations regarding the impact of the transition on
32existing medical center employees and employee classifications.

33(B) Meeting and conferring on all of the following issues:

34(i) The timeframe for which the transfer of personnel shall occur.
35The timeframe shall be subject to modification by the board of
36supervisors as appropriate, but in no event shall it exceed one year
37from the effective date of transfer of governance from the board
38of supervisors to the hospital authority.

39(ii) A specified period of time during which employees of the
40county impacted by the transfer of governance may elect to be
P9    1appointed to vacant positions with the Alameda County Health
2Care Services Agency for which they have tenure.

3(iii) A specified period of time during which employees of the
4county impacted by the transfer of governance may elect to be
5considered for reinstatement into positions with the county for
6which they are qualified and eligible.

7(iv) Compensation for vacation leave and compensatory leave
8accrued while employed with the county in a manner that grants
9affected employees the option of either transferring balances or
10receiving compensation to the degree permitted employees laid
11off from service with the county.

12(v) A transfer of sick leave accrued while employed with the
13county to hospital authority employment.

14(vi) The recognition by the hospital authority of service with
15the county in determining the rate at which vacation accrues.

16(vii) The possible preservation of seniority, pensions, health
17benefits, and other applicable accrued benefits of employees of
18the county impacted by the transfer of governance.

19(2) Nothing in this subdivision shall be construed as prohibiting
20the hospital authority from determining the number of employees,
21the number of full-time equivalent positions, the job descriptions,
22and the nature and extent of classified employment positions.

23(3) Employees of the hospital authority are public employees
24for purposes of Division 3.6 (commencing with Section 810) of
25Title 1 of the Government Code relating to claims and actions
26against public entities and public employees.

27(x) Any hospital authority created pursuant to this section shall
28be bound by the terms of the memorandum of understanding
29executed by and between the county and health care and
30management employee organizations that is in effect as of the date
31this legislation becomes operative in the county. Upon the
32expiration of the memorandum of understanding, the hospital
33authority shall have sole authority to negotiate subsequent
34memorandums of understanding with appropriate employee
35organizations. Subsequent memorandums of understanding shall
36be approved by the hospital authority.

37(y) The hospital authority created pursuant to this section may
38borrow from the county and the county may lend the hospital
39authority funds or issue revenue anticipation notes to obtain those
P10   1funds necessary to operate the medical center and otherwise provide
2medical services.

3(z) The hospital authority shall be subject to state and federal
4taxation laws that are applicable to counties generally.

5(aa) The hospital authority, the county, or both, may engage in
6marketing, advertising, and promotion of the medical and health
7care services made available to the community at the medical
8center.

9(bb) The hospital authority shall not be a “person” subject to
10suit under the Cartwright Act (Chapter 2 (commencing with Section
1116700) of Part 2 of Division 7 of the Business and Professions
12Code).

13(cc) Notwithstanding Article 4.7 (commencing with Section
141125) of Chapter 1 of Division 4 of Title 1 of the Government
15Code related to incompatible activities, no member of the hospital
16authority administrative staff shall be considered to be engaged in
17activities inconsistent and incompatible with his or her duties as
18a result of employment or affiliation with the county.

19(dd) (1) The hospital authority may use a computerized
20management information system in connection with the
21administration of the medical center.

22(2) Information maintained in the management information
23system or in other filing and records maintenance systems that is
24confidential and protected by law shall not be disclosed except as
25provided by law.

26(3) The records of the hospital authority, whether paper records,
27records maintained in the management information system, or
28records in any other form, that relate to trade secrets or to payment
29rates or the determination thereof, or which relate to contract
30negotiations with providers of health care, shall not be subject to
31disclosure pursuant to the California Public Records Act (Chapter
325 (commencing with Section 6250) of Division 7 of Title 1 of the
33Government Code). The transmission of the records, or the
34information contained therein in an alternative form, to the board
35of supervisors shall not constitute a waiver of exemption from
36disclosure, and the records and information once transmitted shall
37be subject to this same exemption. The information, if compelled
38pursuant to an order of a court of competent jurisdiction or
39administrative body in a manner permitted by law, shall be limited
40to in-camera review, which, at the discretion of the court, may
P11   1include the parties to the proceeding, and shall not be made a part
2of the court file unless sealed.

3(ee) (1) Notwithstanding any other law, the governing board
4may order that a meeting held solely for the purpose of discussion
5or taking action on hospital authority trade secrets, as defined in
6subdivision (d) of Section 3426.1 of the Civil Code, shall be held
7in closed session. The requirements of making a public report of
8actions taken in closed session and the vote or abstention of every
9member present may be limited to a brief general description
10devoid of the information constituting the trade secret.

11(2) The governing board may delete the portion or portions
12containing trade secrets from any documents that were finally
13approved in the closed session that are provided to persons who
14have made the timely or standing request.

15(3) Nothing in this section shall be construed as preventing the
16governing board from meeting in closed session as otherwise
17provided by law.

18(ff) Open sessions of the hospital authority shall constitute
19official proceedings authorized by law within the meaning of
20Section 47 of the Civil Code. The privileges set forth in that section
21with respect to official proceedings shall apply to open sessions
22of the hospital authority.

23(gg) The hospital authority shall be a public agency for purposes
24of eligibility with respect to grants and other funding and loan
25guarantee programs. Contributions to the hospital authority shall
26be tax deductible to the extent permitted by state and federal law.
27 Nonproprietary income of the hospital authority shall be exempt
28from state income taxation.

29(hh) Contracts by and between the hospital authority and the
30state and contracts by and between the hospital authority and
31providers of health care, goods, or services may be let on a nonbid
32basis and shall be exempt from Chapter 2 (commencing with
33Section 10290) of Part 2 of Division 2 of the Public Contract Code.

34(ii) (1) Provisions of the Evidence Code, the Government Code,
35including the Public Records Act (Chapter 5 (commencing with
36Section 6250) of Division 7 of Title 1 of the Government Code),
37the Civil Code, the Business and Professions Code, and other
38applicable law pertaining to the confidentiality of peer review
39activities of peer review bodies shall apply to the peer review
40activities of the hospital authority. Peer review proceedings shall
P12   1constitute an official proceeding authorized by law within the
2meaning of Section 47 of the Civil Code and those privileges set
3forth in that section with respect to official proceedings shall apply
4to peer review proceedings of the hospital authority. If the hospital
5authority is required by law or contractual obligation to submit to
6the state or federal government peer review information or
7information relevant to the credentialing of a participating provider,
8that submission shall not constitute a waiver of confidentiality.
9The laws pertaining to the confidentiality of peer review activities
10shall be together construed as extending, to the extent permitted
11by law, the maximum degree of protection of confidentiality.

12(2) Notwithstanding any other law, Section 1461 shall apply to
13hearings on the reports of hospital medical audit or quality
14assurance committees.

15(jj) The hospital authority shall carry general liability insurance
16to the extent sufficient to cover its activities.

17(kk) In the event the board of supervisors determines that the
18hospital authority should no longer function for the purposes as
19set forth in this chapter, the board of supervisors may, by ordinance,
20terminate the activities of the hospital authority and expire the
21hospital authority as an entity.

22(ll) A hospital authority which is created pursuant to this section
23but which does not obtain the administration, management, and
24control of the medical center or which has those duties and
25responsibilities revoked by the board of supervisors shall not be
26empowered with the powers enumerated in this section.

27(mm) (1) The county shall establish baseline data reporting
28requirements for the medical center consistent with the Medically
29Indigent Health Care Reporting System (MICRS) program
30 established pursuant to Section 16910 of the Welfare and
31Institutions Code and shall collect that data for at least one year
32prior to the final transfer of the medical center to the hospital
33authority established pursuant to this chapter. The baseline data
34shall include, but not be limited to, all of the following:

35(A) Inpatient days by facility by quarter.

36(B) Outpatient visits by facility by quarter.

37(C) Emergency room visits by facility by quarter.

38(D) Number of unduplicated users receiving services within the
39medical center.

P13   1(2) Upon transfer of the medical center, the county shall
2establish baseline data reporting requirements for each of the
3medical center inpatient facilities consistent with data reporting
4requirements of the Office of Statewide Health Planning and
5Development, including, but not limited to, monthly average daily
6census by facility for all of the following:

7(A) Acute care, excluding newborns.

8(B) Newborns.

9(C) Skilled nursing facility, in a distinct part.

10(3) From the date of transfer of the medical center to the hospital
11authority, the hospital authority shall provide the county with
12quarterly reports specified in paragraphs (1) and (2) and any other
13data required by the county. The county, in consultation with health
14care consumer groups, shall develop other data requirements that
15shall include, at a minimum, reasonable measurements of the
16changes in medical care for the indigent population of Alameda
17 County that result from the transfer of the administration,
18management, and control of the medical center from the county
19to the hospital authority.

20(nn) A hospital authority established pursuant to this section
21shall comply with the requirements of Sections 53260 and 53261
22of the Government Code.

23begin insert

begin insertSEC. end insertbegin insert2.end insert  

end insert
begin insert

The Legislature finds and declares that a special law
24is necessary and that a general law cannot be made applicable
25within the meaning of Section 16 of Article IV of the California
26Constitution because of the unique needs faced by Alameda County
27with respect to the operation and administration of Alameda
28County Medical Center.

end insert
begin delete29

SECTION 1.  

Section 69841 of the Government Code is
30amended to read:

31

69841.  

Notwithstanding Section 167 of the Code of Civil
32Procedure, the clerk of the superior court shall attend each session
33of the superior court in the county and upon the judges of the court
34in chambers when required.

end delete


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