BILL ANALYSIS                                                                                                                                                                                                    Ķ



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          Date of Hearing:  August 13, 2013

                            ASSEMBLY COMMITTEE ON HEALTH
                                 Richard Pan, Chair
                    SB 494 (Monning) - As Amended:  August 5, 2013

           SENATE VOTE :  38-0
           
          SUBJECT  :  Health care providers.

           SUMMARY  :  Authorizes health plans licensed by the Department of  
          Managed Health Care (DMHC) and managed care plans participating  
          in the Medi-Cal program to permit the assignment of an average  
          of an additional 1,000 enrollees for each full-time equivalent  
          nonphysician medical practitioner supervised by a primary care  
          physician (PCP).  Establishes differing definitions for  
          nonphysician medical practitioners in the Health and Safety,  
          Insurance, and Welfare and Institutions Codes.  Specifically,  
           this bill  :

          1)Authorizes, notwithstanding any other state law or regulation,  
            if a PCP supervises one or more nonphysician medical  
            practitioners, the physician to be assigned an average of an  
            additional 1,000 enrollees for each full-time equivalent  
            nonphysician medical practitioner supervised by that  
            physician, in addition to the number of enrollees assigned to  
            that physician pursuant to current law and approved by the  
            DMHC.

          2)States that this bill does not require a PCP to accept an  
            assignment of enrollees by a health plan without his or her  
            approval or that would be contrary to the Health Care  
            Providers' Bill of Rights.

          3)States that this bill cannot be interpreted to modify existing  
            law regarding supervision of physician assistants (PAs).

          4)Defines a nonphysician medical practitioner as a PA performing  
            services under physician supervision in compliance with  
            existing law or a nurse practitioner (NP) performing services  
            in collaboration with a physician pursuant to existing law.  

          5)Establishes, for purposes of insurers who contract with  
            providers for alternate rates (Preferred Provider  
            Organizations), a definition of a nonphysician medical  








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            practitioner as a PA performing services under physician  
            supervision in compliance with existing law or a NP performing  
            services in collaboration with a physician pursuant to  
            existing law, and adds that in accordance with existing  
            Medi-Cal law, a nonphysician medical practitioner is to be  
            considered a primary care provider.

          6)States that this bill does not require a PCP to accept the  
            assignment of a number of insureds that would exceed standards  
            of good health care as provided in existing law related to  
            timely access to health care services.

          7)States for purposes of Medi-Cal managed care (MCMC) plans, as  
            defined, nonphysician medical practitioner means a PA  
            performing services under physician supervision in compliance  
            with existing law, a NP performing services in collaboration  
            with a physician pursuant to existing law, or a certified  
            nurse-midwife (CNM) performing services under physician  
            supervision in compliance with existing law.  

          8)States that if the assignment of beneficiaries enrolled in any  
            type of MCMC plan to a PCP is authorized or required by a  
            provision in Medi-Cal law, or any regulation, contract, or  
            policy promulgated thereunder, each full-time equivalent PCP  
            may be assigned up to 2,000 beneficiaries.  Permits,  
            notwithstanding any other state law or regulation, if a PCP in  
            that plan, supervises one or more nonphysician medical  
            practitioners, the physician may be assigned up to an  
            additional 1,000 beneficiaries for each full-time equivalent  
            nonphysician medical practitioner supervised by that  
            physician.

          9)Replaces the term "primary care physician" with "primary care  
            practitioner" in the definition of PCP in Medi-Cal law and  
            includes as a primary care practitioner a nonphysician medical  
            practitioner.

           EXISTING LAW  :  

          1)Establishes the California Department of Insurance (CDI) to  
            regulate health and other insurance, the DMHC to license and  
            regulate health care service plans, the Department of Health  
            Care Services (DHCS) to administer California's Medicaid  
            Program (Medi-Cal), the Medical Board of California (MBC)  
            which licenses and regulates physician and surgeons, the Board  








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            of Registered Nursing which licenses and regulates nurses,  
            including NPs, and the Physician Assistant Board to license  
            and regulate PAs.  

          2)Requires pursuant to Medi-Cal managed care regulations that  
            each plan in a designated region retain sufficient  
            professional medical staff to provide access to preventive and  
            managed health care services to its members.  Requires access  
            to physicians or physician extenders as follows:
             a)   Requires each plan to ensure its provider network  
               satisfies a ratio of at least one full-time equivalent PCP  
               for every 2,000 members;
             b)   Requires each plan to ensure its provider network  
               satisfies a ratio of at least one full-time equivalent  
               physician for every 1,200 plan members;
             c)   Prohibits plans that utilize nonphysician medical  
               practitioners from allowing a full-time equivalent  
               nonphysician medical practitioner to maintain a caseload of  
               more than 1,000 plan members; and,
             d)   Authorizes, if utilized by a plan, members to select a  
               nonphysician medical practitioner as their PCP.  Requires  
               nonphysician medical practitioner practitioners, including  
               CNMs, NPs and PAs, to meet the requirements of existing  
               practice and licensure standards for mid-level  
               practitioners, as specified. 

          3)Defines, "primary care physician" in California law affecting  
            MCMC, as a physician who has the responsibility for providing  
            initial and primary care to patients, maintaining the  
            continuity of patient care, and initiating referral for  
            specialist care.  Requires a PCP to be either a physician who  
            has limited his or her practice of medicine to general  
            practice or who is a board-certified or board-eligible  
            internist, pediatrician, obstetrician-gynecologist, or family  
            practitioner.

          4)Requires services provided by a certified NP to be covered  
            under Medi-Cal to the extent authorized by federal law and  
            subject to utilization controls.  Requires DHCS to permit a  
            certified NP to bill Medi-Cal independently for his or her  
            services.  If a certified NP chooses to bill Medi-Cal  
            independently for his or her services, requires DHCS to make  
            payment directly to the certified NP.

          5)Requires services provided by a PA to be covered under  








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            Medi-Cal to the extent authorized by federal law and subject  
            to utilization controls.  Requires all services performed by a  
            PA within his or her scope of practice that would be a covered  
            benefit if performed by a physician and surgeon to be a  
            covered benefit under Medi-Cal and prohibits DHCS from  
            imposing chart review, countersignature, or other conditions  
            of coverage or payment on a physician and surgeon supervising  
            PAs that are more stringent than requirements imposed by  
            existing law or regulations of the MBC.

          6)Requires pursuant to DMHC regulations, health plans to ensure  
            enrollees have a residence or workplace within 30 minutes or  
            15 miles of a contracting or plan-operated PCP in such numbers  
            and distribution as to accord to all enrollees a ratio of at  
            least one PCP (on a full-time equivalent basis) to each 2,000  
            enrollees.  

          7)Prohibits for DMHC regulated health plans as part of the  
            Health Care Providers' Bill of Rights a contract between a  
            plan and a health care provider from containing a provision  
            that requires a health care provider to accept additional  
            patients beyond the contracted number or in the absence of a  
            number, if in the reasonable professional judgment of the  
            provider, accepting additional patients would endanger  
            patients' access to, or continuity of, care.

          8)Includes a NP or PA as a qualified primary care provider in  
            the definition of "Advanced Access" pursuant to DMHC  
            regulations on Timely Access to Non-Emergency Health Care  
            Services. 

          9)Prohibits a physician and surgeon from supervising more than  
            four PAs at any one time, except as specified.  Permits the  
            MBC to restrict a physician and surgeon to supervising  
            specific types of PAs including, but not limited to,  
            restricting a physician and surgeon from supervising PAs  
            outside of the field of specialty of the physician and  
            surgeon.  

          10)Prohibits a physician and surgeon from supervising more than  
            four NPs at one time.

          11)Defines "primary care provider" in federal law pursuant to  
            the federal Patient Protection and Affordable Care Act (ACA)  
            Primary Care Extension Program as a clinician who provides  








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            integrated, accessible health care services and who is  
            accountable for addressing a large majority of personal health  
            care needs, including providing preventive and health  
            promotion services for men, women, and children of all ages,  
            developing a sustained partnership with patients and  
            practicing in the context of family and community, as  
            recognized by a state licensing or regulatory authority,  
            unless otherwise specified.

          12)Requires under the ACA, if a group health plan or a health  
            insurance issuer offering group or individual health insurance  
            coverage requires or provides for designation by a  
            participant, beneficiary, or enrollee of a participating  
            primary care provider, the plan or issuer to permit each  
            participant, beneficiary, and enrollee to designate any  
            participating primary care provider who is available to accept  
            such individual.

          13)Defines "primary care practitioner" in federal law pursuant  
            to ACA Medicare incentive payments for primary care services  
            as an individual who is a physician, as described, who has a  
            primary specialty designation of family medicine, internal  
            medicine, geriatric medicine, or pediatric medicine; or, is a  
            NP, clinical nurse specialist, or PA and for whom primary care  
            services accounted for at least 60% of the allowed charges for  
            such physician or practitioner in a prior period as determined  
            appropriate by the Secretary of the federal Department of  
            Health and Human Services (DHHS).

          14)Requires CDI to adopt regulations to ensure that insureds  
            have the opportunity to access needed health care services in  
            a timely manner, and that these regulations are designed to  
            assure accessibility of provider services in a timely manner  
            to individuals comprising the insured or contracted group,  
            including adequacy of number of professional providers, and  
            license classifications of such providers, in relationship to  
            the projected demands for services covered under the group  
            policy or plan. 

           FISCAL EFFECT  :  According to the Senate Appropriations Committee  
          analysis, one-time costs of $600,000 to review plan filings by  
          the DMHC (Managed Care Fund).  Potential ongoing enforcement  
          cost in the tens of thousands per year by the DMHC (Managed Care  
          Fund).  One-time costs of $80,000 to update regulations by the  
          CDI (Insurance Fund).








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           COMMENTS  :

           1)PURPOSE OF THIS BILL  .  According to the author, current  
            Medi-Cal regulation specifies that managed care plans are  
            required to ensure the provider network satisfies a ratio of  
            one full-time equivalent PCP for every 2,000 plan members,  
            further the regulation specifies full-time equivalent  
            nonphysician medical practitioners are permitted to maintain a  
            caseload of 1,000 plan members.  The author states, given  
            California's primary care provider workforce shortage, which  
            will become further complicated by additional individuals  
            eligible for coverage under the ACA, this bill proposes that a  
            PCP panel/practice should be allowed to increase up to an  
            additional 1,000 patients based on the use of a PA or NP.  The  
            author adds recognizing PAs and NPs as PCPs while still  
            keeping the existing relationship between a supervising  
            physician and the patient would also align federal and state  
            definitions of a "primary care provider."  According to the  
            author, the federal definition of a "primary care provider" in  
            the ACA acknowledges PCPs, PAs, and NPs as primary care  
            providers.  However, California law, which defines primary  
            care providers for purposes of MCMC, defines them as only  
            PCPs.

          The author states that California is in the midst of a  
            well-documented shortage of primary care providers and a  
            serious misdistribution of specialists throughout the state.   
            Current health care workforce deficits compromise access to  
            care in many areas throughout the state and impede adherence  
            to state-imposed timely access.  Further complicating the  
            health workforce capacity challenges is the impending increase  
            of an estimated 4 to 6 million people in California who will  
            become eligible for private or governmental coverage in  
            January 2014 as a result of the ACA. The author believes by  
            essentially increasing the size of a physician's panel, a  
            health plan will immediately add providers to the  
            physician-led team and begin to address the need for more  
            PCPs.

            The California Academy of Physician Assistants (CAPA)  
            indicates that some MCMC organizations assign panels to PAs,  
            and although this practice is widespread in 18 other states,  
            the current predominant practice in California is to only  
            empanel physicians.  








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           2)BACKGROUND  .  On March 23, 2010, the federal government enacted  
            the ACA (Public Law 111-148), which was further amended by the  
            Health Care Education Reconciliation Act (H.R. 4872).  Much of  
            the ACA is geared toward expanding public and private health  
            insurance coverage and it includes incentive payments for  
            primary care services.  The ACA establishes a 10% Medicare  
            bonus for services furnished on and between January 1, 2011  
            and January 1, 2016 by a "primary care practitioner," which is  
            defined as a physician who has primary specialty designation  
            in family medicine, internal medicine, geriatric medicine, or  
            pediatric medicine, or is a NP, clinical nurse specialist, or  
            PA and for whom primary care services accounted for at least  
            60% of the allowed charges for such physician or practitioner  
            in a prior period, as determined by the DHHS Secretary.  The  
            ACA also provides for a temporary increase in Medicaid  
            payments for certain primary care services furnished in 2013  
            and 2014 by a physician with a primary specialty designation  
            of family medicine, general internal medicine, or pediatric  
            medicine such that the new rates for those years would be at  
            least 100% of the applicable rate paid for such services under  
            Medicare.  The requirement applies to MCMC plans.  The  
            additional cost of the increased payment (for the difference  
            between the Medicare rate and the Medicaid payment rate for  
            such services in effect as of July 1, 2009) is fully funded by  
            the federal government.  Physician extenders, such as NPs,  
            PAs, and CNMs who work under supervision of an eligible  
            physician are eligible for the increased Medicaid payment.   
            According to a January 8, 2013 presentation by DHCS,  
            physicians self-attest their eligibility and identify specific  
            eligibility criteria.  The state will audit a statistically  
            valid sample of providers, and plans may also be required to  
            audit a sample of their providers.

           3)NPS AND PAS AND PRIMARY CARE  .  An August 2011 issue brief  
            published by the University of California San Francisco (UCSF)  
            Center for Health Professions, called "Nurse Practitioners and  
            Physician Assistants Providing Primary Care in California  
            Community Clinics," indicates that most of the primary care  
            provided at one-fifth of the state's Federally Qualified  
            Health Centers (FQHCs) and FQHC look-alike clinics is being  
            provided by NPs and PAs.  The study found strong support for  
            staffing models that include significant reliance on NPs  
            and/or PAs to provide primary care; most clinics reported  
            limited availability of clinicians willing to work at these  








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            sites; they found that they needed to define their pool of  
            potential clinicians broadly to include NPs and PAs as well as  
            physicians; all the study clinics faced extremely high patient  
            demand and having NPs and/or PAs on staff allowed the clinics  
            to, for the most part, meet patient primary care needs.   
            Additionally, one of the key reasons why PAs and NPs play  
            significant roles in community clinics as PCPs is their cost  
            effectiveness.  Finally, while respondents reported that the  
            current range of services NPs and PAs are authorized to  
            provide was appropriate for practice needs, several clinic  
            leaders questioned the usefulness of some requirements such as  
            physician chart reviews for PAs.

           4)SUPPORT  .  One of this bill's sponsors, CAPA, believes this  
            bill will significantly increase the number of lives a  
            practice/physician can be assigned based on the use of a PA or  
            other specified licensed nonphysician medical practitioner.   
            According to CAPA, PAs are licensed health professionals who  
            practice medicine as members of a physician led team,  
            delivering a broad range of medical and surgical services to  
            diverse populations in rural, urban, and suburban settings.   
            CAPA states that PAs have long been recognized as a solution  
            to access to care problems in all settings.  The California  
            Association of Physician Groups (CAPG), also a sponsor of this  
            bill, indicates that this bill provides an important and  
            long-overdue modification of the Knox-Keene Health Care  
            Service Plan Act of 1975 (Knox-Keene) to allow a greater  
            maximum empanelment of managed care enrollees to a  
            physician-led care team.  CAPG asserts that the maximum  
            empanelment ratio is merely that, and most organizations  
            determine internally what their true maximum enrollment ratio  
            should be based on a variety of factors, so it is important to  
            note that this change to Knox-Keene does not mean that all  
            panels across the state will automatically float to the  
            proposed maximums.  CAPG adds that the current ratios have  
            been in place for over 30 years, and modern care management  
            and health information technology allow new capabilities to  
            expand access, shrink wait times, and to increase value of  
            encounters that patients have with their health care system.   
            The Bay Area Council asserts that the business community  
            recognizes that strengthening the team-based approach to  
            primary care and allowing these teams of providers to take on  
            additional patients will improve efficiency, help control  
            costs, and create additional capacity in our state's  
            increasingly overburdened healthcare system.








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           5)SUGGESTED AMENDMENTS  .  This bill has some inconsistencies in  
            definitions and in several places contains provisions that  
            state "notwithstanding any other state law or regulation"  
            which are not necessary. The author and sponsor have agreed to  
            technical amendments to address these issues.  Further, it is  
            not clear what impact this change to the physician to enrollee  
            ratio may have on capacity and access at individual practices.  
             Therefor the committee may wish to include a sunset date of  
            December 31, 2018 to give stakeholders an opportunity to  
            revisit the impacts of this policy change.

           6)RELATED LEGISLATION  .  

             a)   SB 491 (Ed Hernandez) permits a NP to practice  
               independently after a period of physician supervision if  
               the NP has national certification and liability insurance,  
               and authorizes the NP to perform various other specified  
               tasks related to the practice of nursing without protocols.  
                SB 491 failed passage in the Assembly Business,  
               Professions and Consumer Protection Committee and was  
               granted reconsideration, therefore could be given an  
               additional hearing and voted on by that committee once  
               more.

             b)   SB 352 (Pavley) authorizes medical assistants to perform  
               technical supportive services in any medical setting upon  
               specific authorization of a PA, NP, or CNM without a  
               physician on the premises.  SB 352 is currently pending on  
               the Assembly Floor.

           7)PREVIOUS LEGISLATION  .

             a)   SB 2348 (Mitchell), Chapter 460, Statutes of 2012,  
               allows registered nurses (RNs) to dispense and administer  
               hormonal contraceptives under a standardized procedure, as  
               specified, and allows RNs to dispense drugs and devices  
               upon an order by a physician and surgeon, a CNM, a NP, or a  
               PA while functioning within specified clinic settings.

             b)   SB 819 (Yee), Chapter 308, Statutes of 2009, among other  
               things, expands the authorized functions that may be  
               performed by a NP practicing under standardized procedures  
               to include:  ordering durable medical equipment, as  
               specified; certifying disability, as specified, after  








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               performance of a physical examination by the NP and in  
               collaboration with a physician and surgeon; and, approving,  
               signing, modifying, or adding to a plan of treatment or  
               plan of care for individuals receiving home health services  
               or personal care services, after consultation with the  
                                                                   treating physician and surgeon.

             c)   AB 3 (Bass), Chapter 376, Statutes of 2007, increases  
               the maximum number of PAs that may be supervised by a  
               physician and surgeon from two to four, and specifies that  
               services provided by a PA are a covered Medi-Cal benefit if  
               that same service would be a covered benefit if it were  
               performed by a physician and surgeon.

             d)   AB 1591 (Chan), Chapter 719, Statutes of 2006, permits  
               any certified NP to bill Medi-Cal independently for his or  
               her services.

             e)   AB 2560 (Montaņez), Chapter 205, Statutes of 2004,  
               expands the locations and types of conditions for which NPs  
               can furnish or order prescription drugs or devices under  
               physician protocols.

             f)   AB 2179 (Cohn), Chapter 797, Statutes of 2002, requires  
               DMHC and CDI to develop and adopt regulations to ensure  
               that enrollees have access to needed health care services,  
               referred to as timely access to services.

           REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          California Academy of Physician Assistants (cosponsor)
          California Association of Physician Groups (cosponsor)
          AARP
          Bay Area Council
          California Association of Health Underwriters
          California Chiropractic Association
          California Medical Association
          California Optometric Association
          California Physical Therapy Association
          California Primary Care Association
          Latino Coalition for a Healthy California
          United Nurses Associations of California/Union of Health Care  
          Professionals








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            Opposition 
           
          None on file.

           Analysis Prepared by  :    Teri Boughton / HEALTH / (916) 319-2097