BILL ANALYSIS                                                                                                                                                                                                    Ó

                                                                  SB 494
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          SB 494 (Monning)
          As Amended September 6, 2013
          Majority vote

           SENATE VOTE  :38-0  
           HEALTH              18-0        APPROPRIATIONS      17-0        
          |Ayes:|Pan, Ammiano, Atkins,     |Ayes:|Gatto, Harkey, Bigelow,   |
          |     |Bonilla, Bonta, Chesbro,  |     |Bocanegra, Bradford, Ian  |
          |     |Gomez,                    |     |Calderon, Campos,         |
          |     |Roger Hernández,          |     |Donnelly, Eggman, Gomez,  |
          |     |Lowenthal, Maienschein,   |     |Hall, Holden, Linder,     |
          |     |Mansoor, Mitchell,        |     |Pan, Quirk, Wagner, Weber |
          |     |Nazarian, Nestande,       |     |                          |
          |     |V. Manuel Pérez, Wagner,  |     |                          |
          |     |Wieckowski, Wilk          |     |                          |
          |     |                          |     |                          |
           SUMMARY  :  Requires a health care service plan licensed by the  
          Department of Managed Health Care (DMHC) to ensure one primary  
          care physician (PCP) for every 2,000 enrollees and authorizes up  
          to an additional 1,000 enrollees for each full-time equivalent  
          nonphysician medical practitioner supervised by that PCP until  
          January 1, 2019.  Specifically,  this bill  :

          1)Requires a health care service plan to ensure there is at  
            least one full-time equivalent PCP for every 2,000 enrollees  
            of the plan and authorizes the number of enrollees per PCP to  
            be increased by up to 1,000 additional enrollees for each  
            full-time equivalent nonphysician medical practitioner  
            supervised by that PCP.

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

          3)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  


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            with a physician pursuant to existing law, or a certified  
            nurse-midwife (CNM) performing services under physician  
            supervision in compliance with existing law.  

           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 to administer California's Medicaid program  
            (Medi-Cal), the Medical Board of California which licenses and  
            regulates physician and surgeons, the Board of Registered  
            Nursing which licenses and regulates nurses, including NPs,  
            and the Physician Assistant Board to license and regulate PAs.  

          2)Requires pursuant to MCMC regulations that each plan in a  
            designated region to 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 practitioners, including CNMs, NPs and  
               PAs, to meet the requirements of existing practice and  
               licensure standards for mid-level practitioners, as  

          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  


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            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  

           FISCAL EFFECT  :  According to the Assembly Appropriations  

          1)One-time costs of under $50,000 to DMHC (Managed Care Fund)  
            for review of licensees' documents verifying compliance with  
            these standards. 

          2)Minor potential ongoing costs, in the tens of thousands of  
            dollars annually to DMHC (Managed Care Fund), for enforcement  
            of new rules related to the size of physician panels.  

          3)It is unclear if this bill will trigger a review of network  
            adequacy requirements in regulation, given the new definitions  
            and authorizations.  If it does, both the CDI and DMHC may  
            incur associated special fund costs.  Costs would depend on  
            the depth of review and revision of regulations. 

           COMMENTS  :  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 Patient Protection and Affordable Care Act (ACA), this  
          bill proposes that a PCP panel or 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.


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          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), one of  
          the sponsors of this bill, 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.  CAPA  
          believes this bill will significantly increase the number of  
          lives a practice or 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  
          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  


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          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.

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

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