BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 326| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 326 Author: Beall (D), et al. Amended: 8/31/15 Vote: 21 SENATE HEALTH COMMITTEE: 8-0, 4/8/15 AYES: Hernandez, Hall, Mitchell, Monning, Nielsen, Pan, Roth, Wolk NO VOTE RECORDED: Nguyen SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/28/15 AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen SENATE FLOOR: 31-5, 6/3/15 AYES: Allen, Bates, Beall, Berryhill, Block, Cannella, De León, Galgiani, Glazer, Hall, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Nielsen, Pan, Pavley, Roth, Vidak, Wieckowski, Wolk NOES: Anderson, Moorlach, Morrell, Nguyen, Stone NO VOTE RECORDED: Fuller, Gaines, Hancock, Runner ASSEMBLY FLOOR: 74-0, 9/10/15 - See last page for vote SUBJECT: Courts: penalties: emergency services funding SOURCE: California Association of Air Medical Services DIGEST: This bill extends the sunset date of the $4 penalty assessment for Vehicle Code violations other than parking offenses, until January 1, 2018, with the resulting revenue deposited in the Emergency Medical Air Transportation Act Fund (Fund). Money in that Fund is primarily used to fund Medi-Cal reimbursement for emergency medical air transportation services. SB 326 Page 2 Requires the Department of Health Care Services to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of penalty assessments under this bill on January 1, 2018. Assembly Amendments require DHCS, by March 1, 2017, in coordination with the Department of Finance, to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of penalty assessments under this bill on January 1, 2018, and make legislative findings and declarations as to the harmful effects of relying on penalty assessments to fund core state programs and the necessity to identify alternative funding sources for emergency medical air transportation services. ANALYSIS: Existing law: 1)Levies, under the Emergency Medical Air Transportation Act (Act), a penalty of $4 upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense. 2)Sunsets the assessment of the $4 penalty under the Act commencing January 1, 2016, and transfers any moneys unexpended and unencumbered in the Fund on June 30, 2017, to the General Fund. 3)Requires the county or the court that imposed the fine to transfer the moneys collected to the Fund. 4)Requires moneys in the Fund to be made available, upon appropriation by the Legislature, to the Department of Health Care Services (DHCS), to be for payment of DHCS administrative costs, with the remainder being used as follows: a) Twenty percent to offset the state portion of the Medi-Cal reimbursement rate for emergency medical air transportation services; and, b) Eighty percent to augment emergency medical air SB 326 Page 3 transportation reimbursement payments made through the Medi-Cal program. 5)Requires DHCS to seek to obtain federal matching funds by using the moneys in the Fund for the purpose of augmenting Medi-Cal reimbursement paid to emergency medical air transportation providers. 6)Repeals the section of law establishing the Act, the Fund, and the Medi-Cal emergency medical air transportation reimbursement provisions on January 1, 2018. This bill: 1)Extends the sunset date of the $4 penalty assessment established under the Act, from January 1, 2016 to January 1, 2018. 2)Extends the January 1, 2018 sunset date of the Act to January 1, 2020, and makes related changes. 3)Requires DHCS, by March 1, 2017, in coordination with the Department of Finance, to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of penalty assessments under this bill on January 1, 2018. 4)Make legislative findings and declarations as to the harmful effects of relying on penalty assessments to fund core state programs and the necessity to identify alternative funding sources for emergency medical air transportation services. Background AB 2173 (Beall, Chapter 547, Statutes of 2010), levied a $4 additional penalty on Vehicle Code violations (excluding parking tickets), with the resulting revenue being used as the state match to draw down additional federal Medicaid matching funds to fund Medi-Cal emergency air medical transportation services. Between $11.2 and $13.7 million has been raised annually from the AB 2173 penalty assessment. Of that amount, $2.2 to $2.7 million is used as the state match to fund current emergency air SB 326 Page 4 ambulance Medi-Cal provider rates. The remaining $9 to $11 million is used to match with federal dollars to augment Medi-Cal rates to emergency air ambulance providers. The $9 to $11 million augmentation amounts from AB 2173 are provided as supplemental payments to eligible Medi-Cal air medical transportation providers that provide fee-for-service emergency air medical transportation services. Approximately 23 air ambulance providers receive the resulting revenue. 1)Penalty Assessments. According to the Judicial Council, the calculation for a traffic ticket in California, and determining where the money goes once collected, is complex. The cost of a traffic ticket includes a base fine amount plus penalty assessments and fees to fund specific state and local activities. The base fine is collected for, and distributed to, either the local government or local government and county. The increase in the total cost of a traffic ticket (above the base fine) in California over the last 20 years is primarily the result of the addition of mandatory penalty assessments and fees. Penalty assessments are typically calculated from the base fine for the traffic ticket and are part of the punishment that is imposed for the violation. The penalties collected are distributed to many different city, county, and state funds established by the local government and Legislature for activities such as DNA collection in criminal cases, emergency medical services, local criminal justice facilities, emergency medical air transportation, and court facility maintenance and construction. The chart below lists three examples of the cost and distribution of a typical traffic ticket, including the base fine, penalties, and fees. The chart below, created by the Judicial Council, provides information on a typical ticket for faulty equipment ($25), a moving violation ($35), and driving more than 25 MPH over the speed limit ($100). ----------------------------------------------------------- | 2013 Traffic Infraction Bail Examples | ----------------------------------------------------------- ------------------------------------------------------------ | | Faulty | Moving | Over | SB 326 Page 5 | |Equipment|Violatio| Limit | | | | n | 25 MPH | ------------------------------------------------------------ ------------------------------------------------------------ | | | | | | ------------------------------------------------------------ ------------------------------------------------------------ | Base Fine | $25.00| $35.00| $100.00| ------------------------------------------------------------ |--------------------+--------------------+--------------------+--------------------+--------------------| |Penalty Assessment |State PA ($10) | 30.00| 40.00| 100.00| |(PA) for every $10 | | | | | |or part of $10 of | | | | | |Base Fine | | | | | -------------------------------------------------------------------------------------------------------- | |County PA (up to | 21.00| 28.00| 70.00| | |$7) | | | | -------------------------------------------------------------------------------------------------------- | |Emergency Medical | 6.00| 8.00| 20.00| | |Services PA ($2) | | | | -------------------------------------------------------------------------------------------------------- | |DNA Fund PA ($5) | 15.00| 20.00| 50.00| |--------------------+--------------------+--------------------+--------------------+--------------------| | |Court Facilities PA | 15.00| 20.00| 50.00| | |($5) | | | | -------------------------------------------------------------------------------------------------------- ------------------------------------------------------------ |Emergency Medical Air | 4.00| 4.00| 4.00| |Transportation PA | | | | ------------------------------------------------------------ |State Surcharge (20% of Base | 5.00| 7.00| 20.00| |Fine) | | | | ------------------------------------------------------------ | Fine and Penalty Subtotal| $121.00| $162.00| $414.00| ------------------------------------------------------------ |Court Operations Fee ($40) | 40.00| 40.00| 40.00| ------------------------------------------------------------ |Criminal Conviction Fee ($35) | 35.00| 35.00| 35.00| ------------------------------------------------------------ |Night Court Fee | 1.00| 1.00| 1.00| |------------------------------+---------+--------+----------| | Total| $197.00| $238.00|$490.00 | SB 326 Page 6 | | | | | ------------------------------------------------------------ Comments Author's statement. According to the author, "[M]any emergency patients transported by air ambulances have no insurance, are not eligible for Medi-Cal, and have no ability to pay for the service, yet these patients are given the same high level of care as those with medical insurance. The Medi-Cal fee schedule pays air ambulance services far below the cost of providing emergency air transportation, and pays nothing if the patient is indigent. Emergency air ambulance services provide coverage to multiple counties within a 100-mile radius of their bases, and as a result often their transports originate in a county other than where they are based. This makes it difficult for them to be funded by local tax support except in the largest of counties. Emergency physicians and air ambulances do not receive additional funding through the Disproportionate Share Hospital (DSH) program, or the county Maddy Emergency Medical Services Fund when they provide treatment to indigent patients. Prior to enactment of the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to these services and will prevent funding for air ambulances from reverting back to 1993 levels by continuing the $4 penalty to fund air ambulance services." FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No According to the Assembly Appropriations Committee: 1)Penalty revenues of around $10 million per year for an additional two years, until 2018 (Emergency Medical Air Transportation Act Fund). Annual revenues will fluctuate depending on the number of Vehicle Code violations that result in convictions, as well as other factors. The numbers below are based on an assumption of $10 million in annual revenue. 2)Administrative costs, likely in the low hundreds of thousands SB 326 Page 7 (Emergency Medical Air Transportation Act Fund). 3)Reduced GF expenditures of around $2 million per year for Medi-Cal payments, by using penalty revenues to offset GF expenditures for emergency air ambulance services for Medi-Cal beneficiaries. 4)Annual expenditures of around $16 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds). SUPPORT: (Verified9/8/15) California Association of Air Medical Services (source) Board for Critical Care Transport Paramedic Certification California Ambulance Association California Children's Hospital Association California Hospital Association CALSTAR Care Flight Children's Hospital Los Angeles Emergency Nurse Association Hall Ambulance Service, Inc. Helinet Aviation Services Loma Linda Children's Hospital Manteca District Ambulance Service Mercy Air Services Mercy Medical Center Redding PHI Air Medical REACH Air Medical Services Rural County Representatives of California Sonora Regional Medical Center Stanford Life Flight SB 326 Page 8 OPPOSITION: (Verified9/8/15) None received ARGUMENTS IN SUPPORT: This bill is sponsored by the California Association of Air Medical Services (Cal-AAMS), which argues this bill will maintain the current level of Medi-Cal funding of emergency air ambulance transportation by removing the sunset clause on the Act created in 2010. Cal-AAMSS states air ambulance services provide life-saving emergency transportation to the most critical patients from automobile accident scenes directly to trauma centers. In addition, emergency helicopter air ambulance providers provide a critical link between rural areas and urban tertiary care hospitals (trauma centers, heart/stroke centers, burn units) and are an essential part of the statewide emergency medical services system. Prior to the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to this essential life-saving service, and will prevent funding for air ambulances to revert back to 1993 levels. Removing the sunset for this penalty will ensure the program continues to support these critical services. The Rural County Representatives of California (RCRC) write in support that air ambulance service is critical in rural and remote areas of California and a healthy air ambulance system ensures rural communities have access to life-saving care for both residents and tourists. RCRC states its member counties have had no issues in their administrative role in administering the penalty assessment, and they believe the Act should be continued in order to promote a vital health care delivery system that is so important in rural and remote areas. ASSEMBLY FLOOR: 74-0, 9/10/15 AYES: Achadjian, Alejo, 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, Gordon, Gray, Grove, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, SB 326 Page 9 Kim, Lackey, Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Waldron, Weber, Wilk, Williams, Wood, Atkins NO VOTE RECORDED: Travis Allen, Hadley, Harper, Linder, Obernolte, Wagner Prepared by:Scott Bain / HEALTH / 9/10/15 23:27:59 **** END ****