BILL ANALYSIS Ó AB 2048 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 2048 (Gray) As Amended August 15, 2016 Majority vote -------------------------------------------------------------------- |ASSEMBLY: |80-0 |(June 1, 2016) |SENATE: |39-0 |(August 17, | | | | | | |2016) | | | | | | | | | | | | | | | -------------------------------------------------------------------- Original Committee Reference: HEALTH SUMMARY: Requires the Office of Statewide Health Planning and Development (OSHPD), in its administration of the National Health Service Corps State Loan Repayment Program (SLRP), to include all federally qualified health centers (FQHCs) located in California on the program's certified eligible site list. The Senate amendments delete OSHPDs authority to provide state matching funds for the program. EXISTING LAW requires OSHPD, in its administration of the SLRP to strive, whenever feasible, to equitably distribute loan repayment awards between eligible urban and rural program sites, after taking into account the availability of health care services in the communities to be served and the number of individuals to be served in each program site. AB 2048 Page 2 FISCAL EFFECT: According the Senate Appropriations Committee, no significant fiscal impact is anticipated by automatically making all federally qualified health centers eligible to participate. Automatically putting all federal qualified health centers on the eligible list does not guarantee any funding from the state; it only makes them automatically eligible to participate, providing they meet other program requirements. COMMENTS: According to the author, FQHCs are safety net providers that serve some of the nation's most vulnerable populations. The author states they are required to offer services to all persons regardless of their ability to pay, be a nonprofit or public organization, serve a medically underserved area, and provide comprehensive primary care services. The author contends that FQHCs reduce health disparities by serving populations that would otherwise not have access to services, and care received at these centers is ranked among the most cost-effective, producing $24 billion in annual health system savings, yet studies have found that the quality of care provided is equal to or even greater that the quality of care provided elsewhere. The author notes the SLRP was created in 1987 to increase and retain the number of primary care physicians, dentists, nurse practitioners, pharmacists, and mental and behavioral specialists in Health Professional Shortage Areas (HPSAs), and while the SLRP is an important program to recruit healthcare professionals to communities in need, FQHCs face burdensome obstacles to participation. The author states that, despite their federal designation, each FQHC is required to submit an application to be placed on the list of Certified Eligible Sites (CES) before applicants from their facility may be considered for loan repayment. Additionally, FQHCs must renew their application every three years to continue participation in the SLRP. The author contends that, as a result of these requirements, less than one-third of the health centers in the state are currently listed on the CES. The author also notes that federal SLRP dollars require a state match, and, while other states provide this match themselves, California has AB 2048 Page 3 shifted that cost onto the health centers. The author points out that California receives only $1 million in federal funding annually, and many small and medium size health centers that cannot afford to provide matching funds are precluded from SLRP participation. The author concludes that this bill will streamline participation in the SLRP by eliminating CES application and renewal requirements for FQHCs, creating notification and reporting requirements to keep health centers and the Legislature informed about the program, and lifting the financial burden of providing matching funds off the shoulders of the health centers. As noted by the author, FQHCs serve a significant portion of the uninsured and underinsured in California. They are open-door providers that treat patients on a sliding scale fee structure and make their services available regardless of a patient's ability to pay. There are approximately 600 FQHCs in California. All FQHCs are either non-profit community clinics or government entities Community clinics and health centers provide health care to 14% of Californians. This figure is even higher in rural or remote areas that struggle to attract and retain health care providers. SLRP was congressionally authorized in 1987 under the United States (U.S.) Public Health Services Act. SLRP increases the number of primary care physicians, dentists, dental hygienists, physician assistants, nurse practitioners, certified nurse midwives, pharmacists and mental/behavioral health providers practicing in federally designated California HPSAs. SLRP authorizes repayment of qualified educational loans for eligible primary health care professionals, who must commit to an initial two year full-time or four year half-time service agreement to provide direct patient care in a primary, dental, or mental health HPSA. In order for a site to be eligible to host SLRP providers, it AB 2048 Page 4 must: 1)Be located in a federally designated HPSA; 2)Be a public or private, not-for-profit, out-patient facility; 3)Match the SLRP award, on a dollar-for-dollar basis; 4)Pay the provider a prevailing wage; and, 5)Provide services on a free or reduced fee schedule basis to individuals at or below 200% of the federal poverty level. The table below shows the areas of the state where current awarded providers are practicing: -------------------------------------------------------- | 2013 | 2014 | 2015 | -------------------------------------------------------- |----------+--------+----------+--------+----------+--------| |Central |Frontier|Central |Frontier|Central |Frontier| | 13 | 0 | 28 | 0 | 26 | 0 | |----------+--------+----------+--------+----------+--------| |Northern |Rural |Northern |Rural |Northern |Rural | |10 | 11 |10 | 21 |12 | 15 | |----------+--------+----------+--------+----------+--------| |Southern |Urban |Southern |Urban |Southern |Urban | |21 |33 |32 |49 |25 |48 | | | | | | | | | | | | | | | | | | | | | | ----------------------------------------------------------- AB 2048 Page 5 Currently, there are 415 SLRP Certified Eligible Sites: 392 primary care, 165 mental health, and 135 dental health. Four are located in Frontier areas, 140 in Rural areas, and 271 in Urban areas. OSHPD notifies all CES when the application cycle opens up each year. OSHPD/SLRP sends stakeholder announcements, updates the SLRP Website and contacts current awardees (healthcare providers) who are eligible for an extension award. The CES application is open year-round. The provider application cycle is tentatively set for August 1 to October 1 of each year but has varied the last few years due to the implementation of OSHPDs online application system. Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097 FN: 0004120