Senate Bill No. 631

Introduced by Senator Beall

February 22, 2013

An act relating to health care.

LEGISLATIVE COUNSEL’S DIGEST

SB 631, as introduced, Beall. Health care.

Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms that take effect January 1, 2014. Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of the act a crime. Existing law also provides for the regulation of health insurers by the Department of Insurance.

This bill would make findings and declarations regarding the PPACA and would declare the intent of the Legislature to evaluate the current use of observational and outpatient settings for the delivery of inpatient-level care, assess the volume of inpatient services delivered in these settings, and determine policy changes necessary to create safe care environments for patients receiving care in these settings.

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

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

SECTION 1.  

(a) The Legislature finds and declares the
following:

(1) The landscape of health care delivery is changing as we look
forward to the full implementation of the federal Patient Protection
Affordable Care Act (PPACA) in California, through which
millions of uninsured Californians will obtain health care coverage.
As rates of health care coverage increase, it is anticipated that more
individuals will seek health care services, including services in
general acute care hospitals. The increased demand may place
additional strains on already crowded emergency departments and
hospitals.

(2) The PPACA imposes new requirements on general acute
care hospitals that will likely result in those hospitals making
significant organizational changes in order to promote the goals
of the PPACA to lower health care costs. These organizational
changes may range from reducing readmission rates, changing the
ways in which patient acuity is assessed, and making more efficient
use of bed space.

(3) Currently, hospitals delay admission of some patients
through extensive use of observational settings. These settings are
often found adjacent to emergency departments, and are used as
an alternative to admitting patients who cannot be safely discharged
to their homes. In these settings, patients are placed for what can
be prolonged periods of time, often extending beyond 24 hours.

(4) The use of outpatient services is expected to increase as
hospitals adapt to payment models that incent avoidance of hospital
readmission. Further, some hospitals have enacted models in which
inpatient services, including inpatient cardiac catheterization, are
provided in outpatient settings.

(5) Observational and outpatient settings are not subject to many
of the laws and regulations aimed at ensuring patient safety and
adequate staffing standards, and the increasing use of these settings
for patients in need of inpatient care raises serious concerns about
patient access to safe levels of care and service.

(b) To ensure that patients are not denied access to safe inpatient
care in today’s health care delivery system, and as hospitals adjust
their business models to comport with new PPACA requirements,
it is the intent of the Legislature to evaluate the current use of
observational and outpatient settings for the delivery of
inpatient-level care, assess the volume of inpatient services
delivered in these settings, and determine policy changes necessary
to create safe care environments for patients receiving care in these
settings.