BILL ANALYSIS                                                                                                                                                                                                    Ó




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                                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  








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          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  








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            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  








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            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  








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            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








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          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  ****








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