BILL ANALYSIS �
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: AB 1310
AUTHOR: Brown
INTRODUCED: May 24, 2013
HEARING DATE: July 3, 2013
CONSULTANT: Moreno
SUBJECT : Medi-Cal: pediatric subacute care.
SUMMARY : Revises provisions relating to the Medi-Cal pediatric
subacute care program.
Existing law:
1.Establishes the Medi-Cal program, administered by the
Department of Health Care Services (DHCS) which provides
comprehensive health benefits to low-income children, their
parents or caretaker relatives, pregnant women, elderly, blind
or disabled persons, nursing home residents, and refugees who
meet specified eligibility criteria.
2.Establishes a Medi-Cal subacute care program for eligible
individuals in health facilities that meet the subacute
criteria.
3.Defines "pediatric subacute services" in the Medi-Cal program
as the health care services needed by a person less than 21
years of age who uses medical technology that compensates for
the loss of vital bodily functions.
4.Requires that medical necessity be substantiated by one of the
following:
a. Tracheostomy with dependence on mechanical ventilation
for a minimum of six hours each day;
b. Dependence on total parenteral nutrition or other
intravenous nutritional support and one of the following:
i. Dependence on tracheostomy care requiring suctioning
at least every six hours and room air mist or oxygen;
ii. Continuous intravenous therapy as specified;
iii. Peritoneal dialysis;
iv. Tube feeding;
v. Other medical technologies that require the services
of a professional nurse; or
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vi. Biphasic Positive Airway Pressure (BiPAP), as
specified, and lacking cognitive or physical ability to
protect the airway.
c. Dependence on tracheostomy care requiring suctioning at
least every six hours and room air mist or oxygen and one
of the conditions in ii) through vi) above;
d. Dependence on skilled nursing care in the administration
of any three of i) through vi) above; or,
e. Dependence on BiPAP and Continuous Positive Airway
Pressure (CPAP), as specified, and one of the conditions in
i) through vi) above.
5.Provides that the medical necessity standard is intended
solely to evaluate the potential eligibility of a patient for
pediatric subacute care who would otherwise be receiving acute
hospital care.
This bill:
1.Revises the definition of pediatric subacute to include a
person who requires treatment for one or more active complex
medical conditions, or requires the administration of one or
more technically complex treatments.
2.Adds the following conditions to the ways in which medical
necessity for eligibility for pediatric subacute services may
be substantiated:
a) Dependence on complex wound care management, including
daily assessment or intervention by a licensed registered
nurse and daily dressing changes, wound packing,
debridement, negative pressure wound therapy, or a special
mattress; or,
b) The patient has a medical condition and requires an
intensity of medical or skilled nursing care such that his
or her health care needs may be satisfied by placement in a
facility providing pediatric subacute care services, but,
in the absence of a facility providing pediatric subacute
care services, the only other inpatient care appropriate to
meet the patient's health care needs under the Medi-Cal
program is in an acute care licensed hospital bed.
3.Makes other technical and clarifying changes.
FISCAL EFFECT : According to the Assembly Appropriations
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Committee, likely costs of at least $50,000 from the General
Fund annually, depending on the extent to which definition
changes lead to an increase in the number of pediatric subacute
care bed days.
PRIOR VOTES :
Assembly Health: 19- 0
Assembly Appropriations: 17- 0
Assembly Floor: 78- 0
COMMENTS :
1.Author's statement. This bill is needed because the current
definition of medical necessity has had the unintended
consequence of keeping some children in acute care hospitals
unnecessarily. The author asserts that children should be
released to subacute care when appropriate and there is no
safe alternative at a lesser cost. The author further states
that improvements to the definition of medical necessity have
been identified which accomplish this objective yet maintain
requirements for complexity of care, including Registered
Nurse and/or Respiratory Therapist interventions. In
addition, the author argues, the age range for pediatric
subacute care should correspond with state law for children
receiving school services, since the integration and
continuity of these services is beneficial. In addition, the
current law is interpreted in such a restrictive way that
children, who could benefit from subacute services outside of
the acute care hospital setting, must remain in the hospital
at a cost much higher than the cost of a subacute pediatric
care facility.`
2.Background. AB 667 (Mitchell), Chapter 294, Statutes of 2011,
codified and updated the criteria used to evaluate and
authorize admission into Medi-Cal pediatric subacute
facilities. Until then, the criteria were in regulations
adopted in 1989 and included a limited number of specific
qualifying conditions. According to (DHCS), these regulations
had never been updated to reflect enhanced and improved
technology such as BiPAP or CPAP which did not exist at the
time the criteria was developed. These devices are now
commonly used as an alternative to a tracheotomy and require
careful supervision by skilled clinical staff - particularly
for young children with serious respiratory issues.
Established on July 1, 1983 by DHCS, the Medi-Cal subacute care
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program makes provisions for patients in facilities who meet
subacute care criteria. Specific reimbursement rates have
been developed for providers of subacute care who have been
licensed and certified. Pediatric subacute care is a level of
care needed by a person less than 21 years of age who uses a
medical technology that compensates for the loss of a vital
bodily function. According to DHCS policies and guidelines,
to be eligible to enter into a contractual agreement with
DHCS, the provider must meet the following criteria:
a. Licensed as an acute care hospital with a distinct part,
skilled nursing facility (SNF);
b. Licensed as a freestanding (FS) SNF;
c. Certified as a long term care Medicare and Medi-Cal
provider;
d. Has a history of compliance with the DHCS Licensing and
Certification program; or,
e. Has professional staff with the ability to provide care
to subacute patients either by experience or demonstrated
competence.
Pediatric subacute care units must employ sufficient subacute
staff, as required by subacute regulation. Staff-to-patient
ratios are a minimum daily average of 5.0 unduplicated
licensed nursing hours per patient day, and 4.0 certified
nurse assistant hours per patient day.
AB 36 (Quakenbush), Chapter 1030, Statutes of 1993, AB 36
authorizes DHCS to establish cost-based reimbursement for the
provision of Medi-Cal benefits to any technology dependent
child who is placed at a lower cost facility, establishes the
services required to be provided at the facility and
authorizes adoption of the regulations later codified by AB
667. AB 36 conditions implementation on federal approval and
full federal financial approval through the Medi-Cal Program.
AB 36 also includes a January 1, 1996 repeal date or
alternatively, was repealed by its own terms after the
establishment of a pediatric service continuum, whichever was
earlier. AB 36 contains legislative intent that in
determining placement and treatment needs of technology
dependent children, an effort should be made to place the
child in the least costly and least restrictive level of care
that still provides for the child's medical safety and
dignity. Daily reimbursement rates for pediatric subacute
facilities vary depending on the type of the facility and
whether the patient is ventilator dependent or non-ventilator
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dependent. Reimbursement rates for each facility are
established by the DHCS based on a model for pediatric
subacute facilities. According to DHCS in 2011, the pediatric
inpatient acute rate was approximately $1,425 per day, whereas
the sub-acute ranged from $895 to $706 per day.
3.Budget rate reduction. AB 97, Chapter 3, Statutes of 2011,
the Omnibus Health Trailer Bill for 2011-12 enacted an overall
10 percent Medi-Cal provider payment reduction, including to
pediatric subacute facilities. DHCS conducted rate analyses
and access studies where necessary in order to obtain federal
Centers for Medicare and Medicaid Services approval. On April
12, 2013, a State Plan Amendment which requested that Medi-Cal
fee-for-service rates for freestanding pediatric sub-acute
facilities be frozen at the 2008-09 levels and the
implementation of a 5.75 percent payment reduction effective
January 1, 2012 was withdrawn after determining that access to
pediatric sub-acute care would be negatively impacted.
4.Prior legislation. AB 1701 (Dymally) would have required DHCS
to implement a Medi-Cal pilot project to provide pediatric
subacute care for a select group of children with complex
ventilator medical needs, would have required DHCS to
establish a supplemental Medi-Cal rate model that would pay
the costs required to provide this enhanced level of care, and
would have required DHCS to conduct an ongoing evaluation of
the pilot project. AB 1701 would have been implemented only if
DHCS could demonstrate fiscal neutrality within the overall
DHCS budget. AB 1701 would have sunset January 1, 2013. AB
1701 was vetoed by Governor Schwarzengger.
SUPPORT AND OPPOSITION :
Support: California Hospital Association
Subacute Saratoga Hospital and Children's Recovery
Center
Totally Kids Specialty Healthcare
1 individual
Oppose: None received
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