AB 2744, as amended, Gordon. Healing arts: referrals.
Existing law provides for the licensure and regulation of various healing arts professions and vocations by boards within the Department of Consumer Affairs. Under existing law, it is unlawful for licensed healing arts practitioners, except as specified, to offer, deliver, receive, or accept any rebate, refund, commission, preference, patronage dividend, discount, or other consideration, in the form of money or otherwise, as compensation or inducement for referring patients, clients, or customers to any person. Existing law makes a violation of this provision a public offense punishable upon a first conviction by imprisonment, as specified, or a fine not exceeding $50,000, or by imprisonment and that fine.
This bill would provide that the payment or receipt of consideration for advertising, wherein a licensed healing arts
practitioner offers or sells servicesbegin delete on an Internet platform,end deletebegin insert through a thirdend insertbegin insert-party advertiserend insert does not constitute a referral ofbegin delete patients.end deletebegin insert patients when the thirdend insertbegin insert-party advertiser does not itself recommend, endorse, or otherwise select a licensee.end insert The bill would require the purchaser of the service to receive a refund of the full purchase price if the licensee determines, after consultation with the purchaser, that the
service is not appropriate for the purchaser. The bill would specify that these provisions do not apply to basic health care services or essential health benefits, as defined. The bill would also provide that the entity that provides advertising is required to be able to demonstrate that the licensee consented in writing to these provisions.begin insert The bill would require a thirdend insertbegin insert-party advertiser to make available for purchase services advertised by all licensees in the applicable geographic region.end insert
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 650 of the Business and Professions Code
2 is amended to read:
(a) Except as provided in Chapter 2.3 (commencing with
4Section 1400) of Division 2 of the Health and Safety Code, the
5offer, delivery, receipt, or acceptance by any person licensed under
6this division or the Chiropractic Initiative Act of any rebate, refund,
7commission, preference, patronage dividend, discount, or other
8consideration, whether in the form of money or otherwise, as
9compensation or inducement for referring patients, clients, or
10customers to any person, irrespective of any membership,
11proprietary interest, or coownership in or with any person to whom
12these patients, clients, or customers are referred is unlawful.
13(b) The payment or receipt of consideration for services other
14than
the referral of patients which is based on a percentage of gross
15revenue or similar type of contractual arrangement shall not be
16unlawful if the consideration is commensurate with the value of
17the services furnished or with the fair rental value of any premises
18or equipment leased or provided by the recipient to the payer.
19(c) The offer, delivery, receipt, or acceptance of any
20consideration between a federally qualified health center, as defined
21in Section 1396d(l)(2)(B) of Title 42 of the United States Code,
22and any individual or entity providing goods, items, services,
23donations, loans, or a combination thereof to the health center
24entity pursuant to a contract, lease, grant, loan, or other agreement,
25if that agreement contributes to the ability of the health center
P3 1entity to maintain or increase the availability, or enhance the
2quality, of
services provided to a medically underserved population
3served by the health center, shall be permitted only to the extent
4sanctioned or permitted by federal law.
5(d) Except as provided in Chapter 2.3 (commencing with Section
61400) of Division 2 of the Health and Safety Code and in Sections
7654.1 and 654.2 of this code, it shall not be unlawful for any person
8licensed under this division to refer a person to any laboratory,
9pharmacy, clinic (including entities exempt from licensure pursuant
10to Section 1206 of the Health and Safety Code), or health care
11facility solely because the licensee has a proprietary interest or
12coownership in the laboratory, pharmacy, clinic, or health care
13facility, provided, however, that the licensee’s return on investment
14for that proprietary interest or coownership shall be based upon
15the amount of the capital
investment or proportional ownership of
16the licensee which ownership interest is not based on the number
17or value of any patients referred. Any referral excepted under this
18section shall be unlawful if the prosecutor proves that there was
19no valid medical need for the referral.
20(e) Except as provided in Chapter 2.3 (commencing with Section
211400) of Division 2 of the Health and Safety Code and in Sections
22654.1 and 654.2 of this code, it shall not be unlawful to provide
23nonmonetary remuneration, in the form of hardware, software, or
24information technology and training services, as described in
25subsections (x) and (y) of Section 1001.952 of Title 42 of the Code
26of Federal Regulations, as amended October 4, 2007, as published
27in the Federal Register (72 Fed. Reg. 56632 and 56644), and
28subsequently amended versions.
29(f) “Health care facility” means a general acute care hospital,
30acute psychiatric hospital, skilled nursing facility, intermediate
31care facility, and any other health facility licensed by the State
32Department of Public Health under Chapter 2 (commencing with
33Section 1250) of Division 2 of the Health and Safety Code.
34(g) The payment or receipt of consideration for advertising,
35wherein a licensee offers or sells servicesbegin delete on an Internet platform,end delete
36begin insert through a thirdend insertbegin insert-party advertiser,end insert shall not constitute a referral of
37begin delete patients.end deletebegin insert
patients when the thirdend insertbegin insert-party advertiser does not itself
38recommend, endorse, or otherwise select a licensee.end insert To the extent
39the licensee determines, after consultation with the purchaser of
40the service, that the service is not appropriate for the purchaser,
P4 1the purchaser shall receive a refund of the full purchase price. This
2subdivision shall not apply to basic health care services, as defined
3in subdivision (b) of Section 1345 of the Health and Safety Code,
4or essential health benefits, as defined in Section 1367.005 of the
5Health and Safety Code and Section 10112.27 of the Insurance
6Code. The entity that provides the advertising shall be able to
7demonstrate that the licensee consented in writing to the
8requirements of this subdivision.begin insert
A thirdend insertbegin insert-party advertiser shall
9make available for purchase services advertised by all licensees
10in the applicable geographic region.end insert
11(h) A violation of this section is a public offense and is
12punishable upon a first conviction by imprisonment in a county
13jail for not more than one year, or by imprisonment pursuant to
14subdivision (h) of Section 1170 of the Penal Code, or by a fine not
15exceeding fifty thousand dollars ($50,000), or by both that
16imprisonment and fine. A second or subsequent conviction is
17punishable by imprisonment pursuant to subdivision (h) of Section
181170 of the Penal Code, or by that imprisonment and a fine of fifty
19thousand dollars ($50,000).
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