BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                            



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                                 UNFINISHED BUSINESS


          Bill No:  SB 1465
          Author:   Senate Health Committee
          Amended:  8/4/14
          Vote:     27 - Urgency

           
           SENATE HEALTH COMMITTEE  :  8-0, 4/24/14
          AYES:  Hernandez, Morrell, Beall, DeSaulnier, Evans, Monning,  
            Nielsen, Wolk
          NO VOTE RECORDED:  De León

           SENATE APPROPRIATIONS COMMITTEE :  Senate Rule 28.8

           SENATE FLOOR  :  35-0, 5/8/14 (Consent)
          AYES:  Anderson, Beall, Berryhill, Block, Cannella, Corbett,  
            Correa, De León, DeSaulnier, Evans, Fuller, Galgiani, Hancock,  
            Hernandez, Hill, Hueso, Huff, Jackson, Lara, Leno, Lieu, Liu,  
            Mitchell, Monning, Morrell, Nielsen, Padilla, Pavley, Roth,  
            Steinberg, Torres, Vidak, Walters, Wolk, Wyland
          NO VOTE RECORDED:  Calderon, Gaines, Knight, Wright, Yee

           ASSEMBLY FLOOR  :  78-0, 8/19/14 - See last page for vote


           SUBJECT  :    Health

           SOURCE  :     Author


           DIGEST  :    This bill requires local emergency medical services  
          agencies to send Emergency Medical Services (EMS) Fund reports  
          to the Emergency Medical Services Authority (EMSA), rather than  
          to the Legislature; allows the Department of Health Care  
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          Services (DHCS) to develop a Medi-Cal provider enrollment  
          application withdrawal process; and makes numerous technical,  
          clarifying changes to existing law.

           Assembly Amendments  add several more technical clarifying  
          changes to this omnibus bill.

           ANALYSIS  :    

          Existing law:

          1.Permits each county to establish an EMS Fund, known as the  
            Maddy Fund, and specifies how these funds are to be used,  
            including limiting administrative costs to no more than 10% of  
            the amount in the Fund, with 58% of the balance of the Fund  
            distributed to physicians for emergency services in hospitals,  
            25% distributed to hospitals providing disproportionate trauma  
            and emergency medical care services, and 17% distributed for  
            other EMS as determined by each county, including funding  
            regional poison control centers.

          2.Requires each county establishing a Maddy Fund to report to  
            the Legislature annually on the implementation and status of  
            the Fund.

          3.Establishes the Medi-Cal program, administered by the DHCS,  
            which provides comprehensive health care coverage for  
            low-income individuals and their families; pregnant women;  
            elderly, blind, or disabled persons; nursing home residents;  
            and, refugees who meet specified eligibility criteria.

          4.Requires a provider to be enrolled in Medi-Cal in order to  
            receive fee-for-service reimbursement for the provision of  
            services, goods, supplies, or merchandise to a Medi-Cal  
            beneficiary.

          5.Requires an applicant seeking to obtain Medi-Cal provider  
            status to submit a complete application package for  
            enrollment, continuing enrollment, enrollment at a new  
            location, or a change in location.  Requires DHCS to provide  
            notice to an applicant within 30 days after receiving an  
            application package that it has been received.

          6.Requires DHCS to provide notice to any applicant, except as  

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            specified, after 180 days from receiving an application  
            package that the applicant does not meet the criteria for  
            preferred provider status, the application package is  
            incomplete, DHCS is exercising its authority as specified to  
            conduct background checks, pre-enrollment inspections, or  
            unannounced visits, or the application is denied for other  
            specified reasons.  Requires DHCS to grant provisional  
            provider status for a period of no longer than 12 months,  
            effective from the 181st day of receiving an application  
            package or from the date on the notice to the applicant.

          7.Enacts the Medi-Cal Hospital Reimbursement Improvement Act of  
            2013 (Act), which imposes a hospital quality assurance fee  
            (QAF), as specified, on certain general acute care hospitals  
            from January 1, 2014, through December 30, 2016.  Requires  
            supplemental payments to be made to private hospitals for  
            certain services, direct grants to public hospitals, increased  
            capitation payments to Medi-Cal managed care plans for  
            hospital services and children's health coverage and DHCS  
            administration.  Sunsets the Act on January 1, 2017.

          8.Requires Covered California, to the extent approved by the  
            appropriate federal agency, to contract with, and certify as a  
            qualified health plan, a bridge plan product that it  
            certifies.

          This bill:

          This omnibus bill makes numerous technical, clarifying, and  
          minor changes to existing law.  Specifically, key provisions of  
          this bill: 

          1.Require local emergency medical services agencies to send EMS  
            Fund reports to EMSA, rather than to the Legislature, and  
            require EMSA to compile and summarize these reports. 

          2.Permit DHCS to cancel a provider application review process if  
            an application package is withdrawn at the request of the  
            applicant or provider. 

          3.For purposes of the existing hospital QAF program, reorganize  
            provisions to distinguish between supplemental payment rates  
            (amounts that hospitals are paid) and fee rates (amount that  
            hospitals pay), define "Fund" as the Hospital Quality  

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            Assurance Revenue Fund, specify data sources to be used for  
            calculations, and modify certain payment rates and fee rates. 

          4.Extends the sunset on the California Health Benefits Review  
            program from June 30, 2015 to December 1, 2015.

           Background
           
           EMS Funds  .  Counties have several sources of revenue for their  
          EMS Funds:  Maddy revenues, derived from county penalty  
          assessments on various criminal offenses and motor vehicle  
          violations; traffic violator school fees; and, revenues from  
          taxes on tobacco products deposited in the state's Cigarette and  
          Tobacco Products Surtax Fund, including the EMS Appropriation.

          The Legislature intended that the EMS Funds be used to reimburse  
          physicians, hospitals, and other providers of emergency  
          services, for providing emergency services to patients who do  
          not have health insurance coverage, cannot afford to pay for  
          those services, and for whom payment will not be made through  
          any private coverage or by any program funded in whole or in  
          part by the federal government.

          Existing law requires courts to collect the fines, penalties,  
          and forfeitures for various criminal offenses, motor vehicle and  
          traffic violations.  Currently, the total penalty assessment is  
          $7 for every $10 of fines and forfeitures, a portion of which  
          goes to the Maddy Fund.  50 counties have established Maddy  
          Funds.

           QAF  .  Federal Medicaid law authorizes states to levy fees on  
          health care providers if the fees meet certain requirements.   
          Many states (including California) fund a portion of their share  
          of Medicaid program costs through a fee on health care  
          providers.  Under these funding methods, states collect funds  
          (through fees, taxes, or other means) from providers, which are  
          then matched to allow increased Medicaid reimbursement to  
          providers.  The Legislature enacted a series of bills  
          establishing a time-limited hospital QAF in 2009, and an  
          additional six-month QAF for the first six months of 2011.  The  
          current QAF sunsets at the end of this calendar year.  In  
          addition to the hospital QAF, California currently has a QAF for  
          intermediate care facilities for the developmentally disabled,  
          and a separate QAF for skilled nursing facilities.

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           Prior Legislation
           
          SB 1368 (Senate Health Committee, Chapter 526, Statutes of 2010)  
          contained language substantially similar to the Maddy Fund  
          reporting requirement language in this bill.  This language was  
          amended out prior to SB 1368 being chaptered into law.

          AB 2248 (Hernandez, 2010) would have required each county  
          establishing a Maddy Fund to include in its annual report to the  
          Legislature a description of each disbursement for other  
          emergency medical services if funds were disbursed for this  
          purpose.  The bill was vetoed by Governor Schwarzenegger, who  
          stated that it would create a reimbursable state mandate and  
          would put a cost pressure on the state's General Fund. 

          SB 476 (Florez, Chapter 707, Statutes of 2003) authorizes each  
          administering agency of an EMS Fund to maintain a reserve in  
          specified portions of its Maddy Fund.  Changes the county  
          reporting requirements and the date at which these are due  
          annually to the Legislature. 

          SB 12 (Maddy, Chapter 1240, Statutes of 1987) creates the Maddy  
          Fund to provide supplemental financing for local emergency  
          services. 

          SB 3X1 (Hernandez, Chapter 5, Statutes of 2013-14, First  
          Extraordinary Session) requires Covered California (the state's  
          Health Benefit Exchange) to establish a "bridge" plan product by  
          contracting with Medi-Cal managed care plans for individuals  
          losing Medi-Cal coverage, the parents of Medi-Cal or Healthy  
          Families Program children, and individuals with incomes below  
          200% of the federal poverty level.  Limits enrollment in bridge  
          plan products only to eligible individuals, and exempts these  
          products from specified provisions of existing law, including a  
          requirement that Covered California products be sold in the  
          outside market.

          SB 239 (Hernandez, Chapter 657, Statutes of 2013) enacted the  
          Act, which imposes a hospital QAF, as specified, on certain  
          general acute care hospitals from January 1, 2014, through  
          December 30, 2016.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    

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          Local:  No

           SUPPORT  :   (Verified  8/19/14)

          California Chapter of the American College of Emergency  
          Physicians
          Osteopathic Physicians and Surgeons of California

           ARGUMENTS IN SUPPORT  :    The California Chapter of the American  
          College of Emergency Physicians states that while the Maddy EMS  
          funds only reimburse a small portion of the cost of care, they  
          are nevertheless a critical source of funding helping to  
          preserve the emergency care safety net.

           
          ASSEMBLY FLOOR  :  78-0, 8/19/14
          AYES:  Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,  
            Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian  
            Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley,  
            Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,  
            Frazier, Beth Gaines, Garcia, Gatto, Gonzalez, Gordon, Gorell,  
            Gray, Grove, Hagman, Hall, Harkey, Roger Hernández, Holden,  
            Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,  
            Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi,  
            Nazarian, Nestande, Olsen, Pan, Patterson, Perea, John A.  
            Pérez, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon,  
            Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner,  
            Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, Atkins
          NO VOTE RECORDED:  Gomez, Vacancy


          JL:k  8/19/14   Senate Floor Analyses 

                           SUPPORT/OPPOSITION:  SEE ABOVE

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