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 services through a third-partybegin delete advertiserend deletebegin insert advertiser,end insert does not constitute a referral of patients when the third-party advertiser does not itself recommend, endorse, or otherwise select a licensee.begin insert The bill would require that the fee paid to the third-party advertiser be commensurate with the service provided by the third-party advertiser.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 servicebegin insert provided by the licenseeend insert is not appropriate for the purchaser,begin insert
or if the purchaser elects not to receive the service for any reason and requests a refund,end insert as specified.begin insert The bill would require that a licensee disclose in the advertisement that a consultation is required and that the purchaser will receive a refund if not eligible to receive the service.end insert 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. The bill would require a third-party advertiser to make available to prospective purchasers advertisements for services of all licensees then advertising through the third-party advertiser in the applicable geographicbegin delete region.end deletebegin insert
region and to disclose, in any advertisement offering a discount price for a service, the regular, nondiscounted price for that service.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.
P3 1(b) The payment or receipt of consideration for services other
2than
the referral of patients which is based on a percentage of gross
3revenue or similar type of contractual arrangement shall not be
4unlawful if the consideration is commensurate with the value of
5the services furnished or with the fair rental value of any premises
6or equipment leased or provided by the recipient to the payer.
7(c) The offer, delivery, receipt, or acceptance of any
8consideration between a federally qualified health center, as defined
9in Section 1396d(l)(2)(B) of Title 42 of the United States Code,
10and any individual or entity providing goods, items, services,
11donations, loans, or a combination thereof to the health center
12entity pursuant to a contract, lease, grant, loan, or other agreement,
13if that agreement contributes to the ability of the health center
14entity to maintain or increase the availability, or enhance the
15quality,
of services provided to a medically underserved population
16served by the health center, shall be permitted only to the extent
17sanctioned or permitted by federal law.
18(d) Except as provided in Chapter 2.3 (commencing with Section
191400) of Division 2 of the Health and Safety Code and in Sections
20654.1 and 654.2 of this code, it shall not be unlawful for any person
21licensed under this division to refer a person to any laboratory,
22pharmacy, clinic (including entities exempt from licensure pursuant
23to Section 1206 of the Health and Safety Code), or health care
24facility solely because the licensee has a proprietary interest or
25coownership in the laboratory, pharmacy, clinic, or health care
26facility, provided, however, that the licensee’s return on investment
27for that proprietary interest or coownership shall be based upon
28the amount of the capital
investment or proportional ownership of
29the licensee which ownership interest is not based on the number
30or value of any patients referred. Any referral excepted under this
31section shall be unlawful if the prosecutor proves that there was
32no valid medical need for the referral.
33(e) Except as provided in Chapter 2.3 (commencing with Section
341400) of Division 2 of the Health and Safety Code and in Sections
35654.1 and 654.2 of this code, it shall not be unlawful to provide
36nonmonetary remuneration, in the form of hardware, software, or
37information technology and training services, as described in
38subsections (x) and (y) of Section 1001.952 of Title 42 of the Code
39of Federal Regulations, as amended October 4, 2007, as published
P4 1in the Federal Register (72 Fed. Reg. 56632 and 56644), and
2subsequently amended versions.
3(f) “Health care facility” means a general acute care hospital,
4acute psychiatric hospital, skilled nursing facility, intermediate
5care facility, and any other health facility licensed by the State
6Department of Public Health under Chapter 2 (commencing with
7Section 1250) of Division 2 of the Health and Safety Code.
8(g) begin deleteThe end deletebegin insertNotwithstanding the other subdivisions of this section
9or any other provision of law, the end insertpayment or receipt of
10consideration for advertising, wherein a licensee offers or sells
11services through a third-party advertiser, shall not constitute a
12referral of patients when the third-party advertiser does not
itself
13recommend, endorse, or otherwise select a licensee.begin insert The fee paid
14to the third-party advertiser shall be commensurate with the service
15provided by the third-party advertiser.end insert If the licensee determines,
16after consultation with the purchaser of the service, that the service
17begin insert provided by the licenseeend insert is not appropriate for thebegin delete purchaser,end delete
18begin insert purchaser or if the purchaser elects not to receive the service for
19any reason and requests a refund,end insert the purchaser shall receive a
20refund of the full purchase price as determined by the terms of the
21advertising service agreement
between the third-party advertiser
22and the licensee.begin insert The licensee shall disclose in the advertisement
23that a consultation is required and that the purchaser will receive
24a refund if not eligible to receive the service.end insert This subdivision shall
25not apply to basic health care services, as defined in subdivision
26(b) of Section 1345 of the Health and Safety Code, or essential
27health benefits, as defined in Section 1367.005 of the Health and
28Safety Code and Section 10112.27 of the Insurance Code. The
29entity that provides the advertising shall be able to demonstrate
30that the licensee consented in writing to the requirements of this
31subdivision. A third-party advertiser shall make available to
32prospective purchasers advertisements for services of all licensees
33then advertising through the third-party advertiser in the applicable
34
geographic region.begin insert In any advertisement offering a discount price
35for a service, the licensee shall also disclose the regular,
36nondiscounted price for that service.end insert
37(h) A violation of this section is a public offense and is
38punishable upon a first conviction by imprisonment in a county
39jail for not more than one year, or by imprisonment pursuant to
40subdivision (h) of Section 1170 of the Penal Code, or by a fine not
P5 1exceeding fifty thousand dollars ($50,000), or by both that
2imprisonment and fine. A second or subsequent conviction is
3punishable by imprisonment pursuant to subdivision (h) of Section
41170 of the Penal Code, or by that imprisonment and a fine of fifty
5thousand dollars ($50,000).
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