BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 299| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 299 Author: Monning (D) Amended: 5/18/15 Vote: 27 - Urgency SENATE HEALTH COMMITTEE: 9-0, 4/8/15 AYES: Hernandez, Nguyen, Hall, Mitchell, Monning, Nielsen, Pan, Roth, Wolk SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8 SENATE FLOOR: 37-0, 4/23/15 (Consent) AYES: Allen, Anderson, Bates, Beall, Berryhill, Block, De León, Fuller, Gaines, Galgiani, Hall, Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Runner, Vidak, Wieckowski, Wolk NO VOTE RECORDED: Cannella, Stone ASSEMBLY FLOOR: 79-0, 7/16/15 (Consent) - See last page for vote SUBJECT: Medi-Cal: provider enrollment SOURCE: Author DIGEST: This bill exempts health care providers submitting a Medi-Cal provider application package to the Department of Health Care Services (DHCS) Medi-Cal provider enrollment division from the current notarization requirements if the provider enrolls electronically. This bill conforms state law to federal regulation by requiring DHCS to designate a provider or SB 299 Page 2 applicant as a "high" categorical risk if DHCS lifted a temporary moratorium within the previous six months for the particular provider type submitting the application. Assembly Amendments require DHCS to collect an application fee for continued enrollment as a Medi-Cal provider. ANALYSIS: Existing law: 1)Establishes the Medi-Cal program, which is administered by DHCS, under which qualified low-income individuals receive health care services. 2)Requires an applicant or provider to submit a complete application package for enrollment as a Medi-Cal provider, and generally requires the application package for enrollment, the provider agreement, and all attachments or changes that are submitted by specified applicants or providers to be notarized. 3)Requires DHCS to collect an application fee for enrollment as a Medi-Cal provider, including enrollment at a new location or a change in location. Prohibits the application fee from being collected from individual physicians or non-physician practitioners, from providers that are enrolled in Medicare or another state's Medicaid program or Children's Health Insurance Program (CHIP), from providers that submit proof that they have paid the applicable fee to a Medicare contractor or to another state's Medicaid program, or pursuant to an exemption or waiver pursuant to federal law. Requires the application fee collected to be in the amount calculated by the federal Centers for Medicare and Medicaid Services (CMS) in effect for the calendar year during which the SB 299 Page 3 application for enrollment is received by DHCS. 4)Designates Medi-Cal provider types as "limited," "moderate," or "high" categorical risk by the federal government, and requires DHCS, at minimum, to utilize the federal regulations in determining a provider's or applicant's categorical risk. 5)Requires DHCS, in accordance with federal regulation, to designate a provider or applicant as a "high" categorical risk if specified conditions are met, including if the CMS lifted a temporary moratorium within the previous six months for the particular provider type submitting the application, the applicant would have been prevented from enrolling based on that previous moratorium, and the applicant applies for enrollment as a provider at any time within six months from the date the moratorium was lifted. This bill: 1)Exempts, from the current DHCS notarization requirements, any provider that chooses to enroll electronically. 2)Requires DHCS to collect an application fee for continued enrollment as a Medi-Cal provider. 3)Conforms state law to federal regulation by requiring DHCS to designate a provider or applicant as a "high" categorical risk if DHCS (in addition to CMS) lifted a temporary moratorium within the previous six months for the particular provider type submitting the application. 4)Deletes various obsolete provisions of law. Comments 1)Author's statement. According to the author, this bill removes the obsolete statutory notarization requirement for SB 299 Page 4 Medi-Cal provider applicants when applying online in an effort to simplify and improve the Medi-Cal enrollment process. Because DHCS is developing an online enrollment system that is scheduled for a September 2015 rollout, the urgency clause included in this bill is necessary to avoid duplicative identity verification. 2)Medi-Cal provider enrollment and electronic applications. State law governing Medi-Cal and federal Medicaid law and regulations contain provisions to prevent and address fraud and abuse in the Medicaid program. DHCS' Provider Enrollment Division (PED) is responsible for the enrollment and re-enrollment of 40 fee-for-service health care provider types into the Medi-Cal program. Later this year, DHCS' PED is proposing to implement the Provider Application and Validation for Enrollment (PAVE) system. PAVE is intended to transform DHCS' provider enrollment activities from a manual process to a web-based portal that providers can use to complete and submit their applications, verifications and report changes. The urgency clause in this bill permits provider applications to be submitted electronically without the current notarization requirement in anticipation of PAVE implementation. 3)Provider fee for continued enrollment. The Assembly amendments require DHCS to collect an application fee for continued enrollment as a Medi-Cal provider. This change provides DHCS with the statutory authority to meet a federal Medicaid regulation requirement that requires states to collect the applicable application fee prior to executing a provider agreement from a prospective or re-enrolling provider other than individual physicians or nonphysician practitioners and providers that are enrolled in Medicare, another state's Medicaid or CHIP program or providers who have paid the applicable application fee to a Medicare contractor or another state. DHCS estimates that of the 130,000 Medi-Cal-enrolled providers, 7,200 are provider types that would be subject to the application fee upon revalidation. 4)Categorical risk of fraud and provider moratorium. Federal regulations require state Medicaid agencies to screen all initial applications, including applications for a new SB 299 Page 5 practice location, and any applications received in response to a re-enrollment or revalidation of enrollment request based on a categorical risk level of "limited," "moderate," or "high." Federal regulations require, when a state Medicaid agency designates a provider as a "high" categorical risk, the agency to conduct a criminal background check and require the submission of fingerprints. Under federal regulations, state Medicaid agencies must adjust the categorical risk level from "limited" or "moderate" to "high" when the state Medicaid agency or CMS in the previous six months lifted a temporary moratorium. This bill conforms state law to this federal regulation if DHCS were to lift a temporary moratorium. DHCS has three enrollment moratoriums currently in effect: (a) clinical laboratories (statewide); (b) durable medical equipment providers located in Los Angeles, Orange, Riverside, and San Bernardino Counties, and out-of-state; and, (c) non-chain, non-pharmacist owned pharmacies in Los Angeles County. FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No According to the Assembly Appropriations Committee: 1)Annual costs of $2 million to support the California Health Benefits Review Program (within the University of California), supported by an assessment on health plans and health insurers (Health Care Benefits Fund). 2)Minor administrative costs for the California Health Benefits Exchange to revise existing regulations to conform to the updated open enrollment period. SUPPORT: (Verified8/10/15) California Association of Physician Groups California Chapter of the American College of Emergency Physicians California Pharmacists Association SB 299 Page 6 Department of Health Care Services OPPOSITION: (Verified8/10/15) None Received ARGUMENTS IN SUPPORT: The California Chapter of the American College of Emergency Physicians (Cal-ACEP) writes in support that emergency physicians have reported problems with enrolling in the Medi-Cal program, and delays can be more than one year before the emergency physician is approved. Cal-ACEP states any effort to lessen the administrative burden on Medi-Cal providers is a welcome relief, and by exempting providers who choose to enroll electronically from the notarization requirements, this bill will do just that. ASSEMBLY FLOOR: 79-0, 7/16/15 AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins NO VOTE RECORDED: Gordon Prepared by:Scott Bain / HEALTH / 8/13/15 13:07:43 **** END **** SB 299 Page 7