BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 2048


                                                                    Page  1


          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          2048 (Gray)


          As Amended  August 15, 2016


          Majority vote


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          |ASSEMBLY:  |80-0  |(June 1, 2016) |SENATE: |39-0  |(August 17,      |
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          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.









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          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  








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          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  








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          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      |
           |          |        |          |        |          |        |
           |          |        |          |        |          |        |
           |          |        |          |        |          |        |
            ----------------------------------------------------------- 








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          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