BILL ANALYSIS Ó
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Date of Hearing: January 12, 2016
ASSEMBLY COMMITTEE ON HEALTH
Rob Bonta, Chair
AB 911
(Brough) - As Amended April 14, 2015
SUBJECT: Hospitals: closures.
SUMMARY: Authorizes Saddleback Memorial Medical Center (SMMC)
to operate an emergency department (ED) at its San Clemente
campus after the hospital at that site is closed. Contains an
urgency clause to ensure that the provisions of this bill go
into immediate effect upon enactment. Specifically, this bill:
1)Allows SMMC to operate an ED at its San Clemente campus if the
following requirements are met:
a) The ED is operated under the consolidated license of
SMMC and meets all of the requirements imposed under that
license, including being within 15 miles of its parent
hospital;
b) The ED is converted from a previously existing acute
care campus and not a newly developed freestanding ED;
c) The ED is open 24 hours a day, 365 days a year;
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d) The ED is staffed with at least one board-certified
emergency physician at all times;
e) The ED is staffed with properly trained emergency room
(ER) nurses and meets the minimum staffing requirements for
EDs in this state;
f) The ED has a complete range of laboratory and diagnostic
radiology services, including a complete array of lab test,
basic X-ray, computerized tomography (CT) scan, and
ultrasound capabilities;
g) The ED meets the specialty call requirements, as defined
by the Orange County Emergency Medical Services Agency,
under its consolidated license;
h) The ED has transfer agreements with specialty centers,
such as trauma, burn, and pediatric centers, to meet the
needs of the injury or patient population served in the
community; and,
i) The ED has a fully functioning transport program with
the capability to safely transport patients who require
admission to its parent hospital or other higher level of
care and specialty services facilities, such as trauma,
burn, and pediatric facilities.
2)Requires all applicable federal and state regulatory
requirements to be met under the consolidated license of SMMC,
including all applicable regulations of the Centers for
Medicare and Medicaid Services (CMS) and Title 22 of the
California Code of Regulations.
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3)Specifies that nothing in this bill requires the hospital to
provide for acute care services at the San Clemente Campus, or
to seek additional licensure for operation of the ED.
EXISTING LAW:
1)Provides for the licensure and regulation of health facilities
by the California Department of Public Health (DPH).
2)Defines a general acute care hospital as a health facility
having a governing body with administrative and professional
responsibility and organized medical staff that provides
24-hour care, including the following basic services:
medical; nursing; surgical; anesthesia; laboratory; radiology;
pharmacy; and, dietary.
3)Authorizes DPH to grant a special permit for a health facility
to provide one or more special services, including emergency
center services.
4)Defines an ED as being located in a hospital licensed to
provide emergency medical services (EMS).
5)Requires DPH to issue a single consolidated license to a
general acute care hospital that includes more than one
physical plant maintained and operated on separate premises or
that has multiple licenses for a single health facility on the
same premises if the general acute care hospital meets certain
criteria and applicable requirements of licensure.
EXISTING STATE REGULATIONS:
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1)Define comprehensive EMS as the provision of diagnostic and
therapeutic services for unforeseen physical and mental
disorders which, if not promptly treated, would lead to marked
suffering, disability, or death. The scope of services is
comprehensive with in-house capabilities for managing all
medical situations on a definitive and continuing basis.
2)Detail the requirements for providing comprehensive EMS which
include, among other things:
a) EMS are to be located in the hospital so as to have
ready access to all necessary services;
b) Comprehensive EMS are to be identified to the public by
an exterior sign, clearly visible form public thoroughfares
which states: COMPREHENSIVE EMERGENCY MEDICAL SERVICE
PHYSICIAN ON DUTY; and,
c) Requiring radiological services, clinical laboratory
services, and surgical services to be immediately available
for life-threatening situations.
3)Detail the requirements for comprehensive EMS staff which
includes:
a) A full-time physician trained and experienced in
emergency medicine;
b) Provides continuous staffing with physicians trained and
experienced in EMS, and requires such physicians to be
assigned to and be located in the emergency service area 24
hours a day; and,
c) Provides experienced physicians in specialty categories
to be available in-house 24 hours a day, including such
specialties as medicine, surgery, anesthesiology,
orthopedics, neurosurgery, pediatrics, and
obstetrics-gynecology.
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EXISTING FEDERAL LAW. The Emergency Medical Treatment and
Active Labor Act, (EMTALA) passed in 1986 as part of the
Consolidated Omnibus Budget Reconciliation Act, requires
hospitals that accept payments from Medicare to provide
emergency health care treatment to anyone needing it
regardless of citizenship, legal status, or ability to pay.
There are no reimbursement provisions. Participating
hospitals may not transfer or discharge patients needing
emergency treatment except with the informed consent or
stabilization of the patient or when their condition requires
transfer to a hospital better equipped to administer the
treatment. EMTALA applies to "participating hospitals." The
statute defines participating hospitals as those that accept
payment from CMS under the Medicare program. Because there
are very few hospitals that do not accept Medicare, the law
applies to nearly all hospitals.
FISCAL EFFECT: This bill has not been analyzed by a fiscal
committee.
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, this bill will
help preserve life-saving emergency care services at San
Clemente's SMMC. The author notes for over 40 years, this
hospital has served as the only emergency care facility in the
city of San Clemente and its neighboring communities, however,
MemorialCare, the hospital's owner, is considering plans to
convert it into an ambulatory health care campus that would
provide outpatient surgery and urgent care services. The
author states this bill is intended to authorize SMMC to
operate a stand-alone ER for purposes of stabilizing patients
prior to transfer to any other hospital in the region.
The author contends, without this bill, SMMC closure could force
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residents to travel 15 miles to reach the next closest ER,
thus increasing mortality rates, which will have a tremendous
impact on the community, especially given the fact that San
Clemente has such a large population of children and elderly
people who are most dependent on life-saving services. The
author adds that underserved communities would also be
adversely affected with limited access to affordable and
quality healthcare.
2)BACKGROUND.
a) SMMC. SMMC is a 325 bed non-profit hospital serving
approximately 800,000 residents in south Orange County. It
operates two acute campuses under a single consolidated
license; the 252 bed Laguna Hills campus, and the 73 bed
San Clemente campus. Saddleback is part of the non-profit
MemorialCare Health System. Saddleback and MemorialCare
have worked over the last decade to transform their
services from an acute care hospital-centric delivery
system, to a population health-based delivery system. They
have made significant investments in chronic disease
management infrastructure and care navigation personnel
aimed at finding new and innovative ways to care for
patients in non-acute care settings. A consequence of
these efforts has been that their inpatient volumes have
fallen. For the last decade, the average inpatient census
was around 25. In recent years, the average census has
dropped to below 14 on average, with many days below 10.
These trends have created concerns regarding the acute care
viability of the San Clemente campus. Thus, MemorialCare
has proposed closing and demolishing the hospital, and
building a new outpatient clinic with an urgent care
center. The surrounding communities, concerned about
access to emergency services, transport, and wait times,
have created a coalition to try to keep the ED open, hence
this bill.
b) Freestanding EDs (FEDs). FEDs have existed for almost
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40 years. They first emerged in the early 1970s as a
result of the need for emergency care in rural or other
underserved regions of the eastern United States. Some of
the first FEDs have now expanded to become full hospitals,
while others have remained freestanding facilities. There
is no strict definition for FEDs, but they are generally a
facility that provides emergency care but is separate from
an acute care hospital. In recent years FEDs have opened
in Florida, Illinois, Texas, and Washington. According to
a 2009 California HealthCare Foundation (CHCF) report,
"Freestanding EDs: Do They Have a Role In California?" the
motivations for constructing FEDs most commonly include the
following:
i) Providing enhanced access to care and meet an
increasing demand for emergency services;
ii) Developing sites and services that differentiate the
organization from its competitors;
iii) Gaining increased market share;
iv) Providing a referral source for affiliated
physicians;
v) Increasing the potential for referring patients to
hospital-based services; and,
vi) Increasing the potential for mitigating competitive
threats.
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The CHCF report also notes that no FEDs offer trauma
services to severely injured patients, those cases are
typically directed by EMS authorities to the nearest trauma
center. FEDs are typically within 15 to 20 miles of a
hospital. The report also goes on to note that because
most FEDS do not receive EMS/911 transports, the majority
of their patients walk into the FED and are lower-acuity
patients.
c) EDs. Under existing law an ED is defined as the
location in a hospital where emergency services are
provided. All licensed general acute care hospitals are
required to meet eight basic services. An ED is considered
a special service, which requires additional approval from
DPH. Historically, ED visits have driven hospital
admissions. A 2013 RAND Corporation report, "The Evolving
Role of Emergency Departments in the United States," notes
that ERs account for about half of the nation's hospital
admissions and accounted for virtually the entire rise in
admissions between 2003 and 2009. ED costs correspond to
the severity of a patient's illness or injury, the number
of diagnostic tests and/or treatments performed,
physicians' fees (typically about 20% to 25% of the total
charges), radiology or specialist services, and any
pharmacy or other hospital expenses. For example, an
ambulance ride alone can cost between $400 and $1,200,
depending upon location, distance from the hospital and
services performed. Costs vary widely in different parts
of the country and ultimately depend upon who pays - the
individual, a private health insurer, or a government
agency like Medicare or Medicaid.
d) Urgent care clinics. The definition of urgent care
varies, but most facilities provide unscheduled care,
after-hours access, expanded services compared to primary
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care, and a lower cost than emergency care. On-site X-ray,
intravenous medications and fluids, repair of lacerations,
foreign body removal, basic fracture care, and treatment of
abscess are most common. According to a 2012 report
published in the American Journal of Clinical Medicine,
"Urgent Care Centers, an Overview," several sources have
reported that the cost of care for comparable medical
problems in urgent care, although slightly more than
primary care, is usually between 10% and 33% of the cost of
emergency care. Copays vary from zero to as much as $100.
Usually they are less than $50.
3)SUPPORT. The City of San Clemente supports this bill, noting
it does not propose changing the hospital and emergency
structure throughout the state, but proposes a standalone ED
solely for this unique geographic region in South Orange
County. The City notes the hospital treats 15,000 ER patients
per year, admits over 4,000 patients, and provides over 200
jobs. The City concludes, with a new 14,000 home development
to the east of town well underway, the loss of the ER will
impact not only the residents of San Clemente, but also the
new families that will continue moving into this area for
years to come.
The Orange County Fire Authority (OCFA) supports this bill,
noting they have reviewed call data for the two emergency
transport units in San Clemente. They state in 2014 there
were 1,701 total transports of which 1,217 (72%) were
transported to SMMC. OCFA contends that without an ER at this
facility the OCFA would be required to transport patients to
hospital further away and possibly delaying treatment.
Save Saddleback San Clemente Hospital is a coalition of
concerned citizens in San Clemente supporting this bill. They
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note they are effectively a peninsula, with Camp Pendleton to
the south, protected forest to the east, the ocean to the
west, and only one road north, 1-5, with which to access
emergency services. They also point out that an I-5 widening
project has just started closing shoulders and ramps
intermittently and that this project will last three years,
potentially increasing transport times.
SMMC is in support of this bill because they desire to
continue to serve the community's EMS needs, including
continuing to receive paramedic traffic and seeing all
emergent patients without regard for their ability to pay.
4)OPPOSITION. The California Chapter of the American College of
Emergency Physicians (California ACEP) is opposed to this bill
stating, freestanding EDs are facilities that provide urgent
care, but are not attached to acute care hospitals.
California ACEP notes, while the words 'emergency department'
are in the title of these facilities, they operate like urgent
care clinics; the very nature of an ED is that it is a
department of a hospital, a place where patients have
immediate access to a wide variety of treatment services and
specialists when necessary to treat their serious conditions.
California ACEP concludes, allowing urgent care facilities to
contain the word emergency in the title poses safety risks to
patients who arrive at the door assuming they can receive
full-scope ED care.
The California Labor Federation (CLF) opposes this bill because
to be licensed in California for EMS, a facility must provide
specialized urgent service onsite, including intensive care
services, laboratory, radiology, surgical services,
post-anesthesia recovery, and blood banks. CLF also notes the
current law states that an ED is in a hospital licensed to
provide emergency services, which indicates that an ED is
required to be part of a health facility providing other
support services. Finally, CLF states, this bill will
undermine existing law and regulations governing the operation
of ED by allowing a freestanding ED without appropriate
regulation and oversight.
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The California Nurses Association (CNA) opposes this bill
stating that SMMC is currently planning to convert its acute
care hospital to outpatient services because of a purported
lack of need for acute care hospital beds. CNA notes, when
making the argument to the community for the need for the new
outpatient service center, the hospital contends that the
majority of patients treated in area ERs do not need to be
seen in an ED; they could be seen in other high quality,
convenient settings if they were available.
The California State Council of the Service Employees
International Union (SEIU California) opposes this bill
stating, in order to provide emergency services is California
emergency service providers must be located within a hospital
so as to have access to all necessary services including:
intensive care, laboratory service, radiological services,
surgical services, post-anesthesia recovery, and readily
available services of a blood bank. SEIU California notes
this bill proposes to reduce this list down to two services,
laboratory and radiological, which causes grave concerns for
patient safety. SEIU California contends it is difficult to
predict the severity of the medical needs of patients
presenting at an ED, and should an individual require
immediate surgery to save their life, or need to be
transferred into an intensive care unit for observations,
those services should be as close and readily available to the
patient as possible.
5)RELATED LEGISLATION.
a) AB 579 (Obernolte) creates an exception to permit a
general acute care hospital to operate an ED located more
than 15 miles from its main physical plant, if all
applicable requirements of licensure are satisfied. AB 579
also permits a closing general acute care hospitals' ED to
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continue to be operated at the same location or locations
by an acquiring general acute care hospital, as specified.
AB 579 creates an exception to permit the acquiring general
acute care hospital to operate the closing general acute
care hospitals' ED at that location or locations, even if
located more than 15 miles from the acquiring general acute
care hospital's main physical plant, if all applicable
requirements of licensure are satisfied. AB 579 is
currently pending in the Assembly Health Committee.
b) SB 787 (Bates) requires a general acute care hospital
that provides EMS and that is scheduled for closure to
conduct public hearings for public review and comment, as
specified. SB 787 also authorizes SMMC, San Clemente, to
continue, under its existing license, to provide EMS to
patients in the region if it otherwise transforms its
delivery of services. SB 787 is set for hearing in the
Senate Health Committee on January 13, 2016.
6)PREVIOUS LEGISLATION.
a) AB 717 (Gordon) of 2005 would have allowed the Centinela
Airport Clinic to receive private and government
reimbursement rates equivalent to that of a contiguous ED
of a general acute care hospital if it meets certain
specified requirements. AB 717 failed passage in the
Senate Health Committee.
b) AB 1050 (Gordon) of 2005, would have created a
demonstration project that required the Department of
Health Services (now DPH) to issue a special permit to up
to four general acute care hospital applicants in Los
Angeles County to operate freestanding emergency receiving
centers. AB 1050 was never heard in Committee.
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7)POLICY COMMENTS. Under current law, when two hospitals
operate under a consolidated license, they share a governing
body, but both facilities must meet all of the requirements of
licensure. This bill appears to turn that premise on its
head, and instead only requires the parent hospital to meet
all licensure requirements, while allowing the FED to operate
with reduced requirements. For example, this bill spells out
certain services the FED would have to provide, such as
laboratory and diagnostic radiology services, including X-ray,
CT scan, and ultrasound capabilities, but remains silent on
whether or not the FED would be able to provide basic required
services such as surgical and dietary, or whether those
services would be provided at the parent hospital. It is
unclear if a FED could safely operate without the ability to
provide those services onsite.
Another issue of concern is the potential for patient harm
stemming from confusion over what differentiates an FED from
ED. While both would be expected to address emergencies, FEDs
appear to be much more like urgent care centers, which are
typically designed to handle less serious illnesses and
injuries, like a sprained ankle, a cut, or the flu. EDs are
equipped to handle life-and-death matters like traumatic
injuries, heart attacks, and strokes, as well as anything less
severe. For example, an individual could experience shortness
of breath, or a toothache, and drive themselves to the FED
thinking they were having an asthma attack, or wanting pain
medication for the toothache, when in fact they were
experiencing a heart attack requiring immediate emergency
surgery, which would not be available at SMMC.
Finally, it is of concern that as currently drafted, this bill
would allow one hospital in the state to charge ED prices
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without meeting the requirements and responsibilities of full
ED licensure, while only providing what is essentially urgent
care service.
REGISTERED SUPPORT / OPPOSITION:
Support
Congressman Darrell Issa
City of Dana Point
City of San Clemente
Saddleback Memorial Medical Center
San Clemente Chamber of Commerce
Save Saddleback San Clemente Hospital
Orange County Fire Authority
Numerous individuals
Opposition
California Chapter of the American College of Emergency
Physicians
California Labor Federation
California Nurses Association/National Nurses United
California State Council of the Service Employees International
Union
Analysis Prepared by:Lara Flynn / HEALTH / (916) 319-2097
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