BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Kevin de León, Chair
SB 1457 (Evans) - Medical care: electronic treatment
authorization requests.
Amended: March 28, 2014 Policy Vote: Health 7-0
Urgency: No Mandate: No
Hearing Date: April 28, 2014
Consultant: Brendan McCarthy
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: SB 1457 would require requests for authorization
of treatment for services in the Medi-Cal program, the
California Children's Services Program, and the Genetically
Handicapped Persons Program to be submitted electronically to
the Department of Health Care Services.
Fiscal Impact:
One-time costs of less than $100,000 to develop and adopt
regulations by the Department of Health Care Services (75%
federal funds and 25% General Fund).
Unknown long-term cost savings by reducing administrative
workload to process paper requests for authorization of
treatment (General Fund and federal funds).
Background: Under current law, the state operates the Medi-Cal
program which provides health care services to low-income
families and individuals. In addition, the state and certain
counties operate the California Children's Services Program
which provides health care services to children with specified
medical conditions. The state also operates the Genetically
Handicapped Persons Program, which provides medical services to
individuals with specified, genetic conditions.
In each of these programs, certain health care services must be
approved by the Department of Health Care Services in advance of
the service being provided. These requests are referred to as
treatment authorization requests (TARs) and Service
Authorization Requests (SARs). Under current practice, health
care providers can submit TARs and SARs in the Medi-Cal program
SB 1457 (Evans)
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to the Department electronically, by facsimile, or by mail. In
the California Children's Services Program and the Genetically
Handicapped Persons Program, TARs and SARs are submitted by mail
or facsimile. TARs and SARs are generally processed by the
Department's fiscal intermediary.
Proposed Law: SB 1457 would require requests for authorization
of treatment for services in the Medi-Cal program, the
California Children's Services Program, and the Genetically
Handicapped Persons Program to be submitted electronically to
the Department of Health Care Services.
The requirement for electronic submission would begin on July 1,
2015 or a later date, as determined by the Department.
The bill authorizes the Department to implement its requirements
without taking regulatory action, but also requires the
Department to subsequently adopt regulations.
Staff comments: Under current practice, the Department uses a
fiscal intermediary (Xerox Corporation) to process billing
requests, TARs and SARs. The Department indicates that the
existing contract with the fiscal intermediary requires it to be
able to process additional electronic submissions and provide
any training or customer service needed by health care providers
during the transition to electronic requests.