BILL ANALYSIS Ó
SB 396
Page 1
Date of Hearing: July 15, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 396
(Hill) - As Amended June 29, 2015
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill implements improvements in oversight of outpatient
settings, or ambulatory surgery centers (ASCs), by the Medical
Board of California (MBC). Specifically, this bill:
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1)Allows an accredited outpatient setting or Medicare-certified
ASC to access peer review reports from the MBC to inform
decisions regarding issuance of staff privileges.
2)Requires accredited outpatient settings to be subject to a
peer review process (similar to a process required for
procedures performed in hospitals) at least every two years,
and requires these results to be reported to the governing
body and reviewed by the accrediting agency.
3)Requires accreditation inspections to be unannounced, within a
60-day notification window.
FISCAL EFFECT:
Minor and absorbable costs to the MBC (Contingent Fund of the
MBC).
COMMENTS:
1)Purpose. This bill is intended to improve the oversight of
outpatient settings by making modest changes to existing
accreditation requirements.
SB 396
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2)Background. Advances in technology, financial incentives, and
consumer demand have resulted in a large number of surgical
procedures being performed in ACSs, as opposed to in
traditional hospital settings. ASCs are a highly profitable
business, with average reported margins in the range of
17-30%. About 97% are investor-owned. A 2007 court decision,
Capen v. Shewry (2007) 155 Cal.App.4th 378, removed the
requirement for ASCs to be licensed by the California
Department of Public Health (CDPH), and was interpreted to
mean that ASCs with physician owners come under the oversight
of the Medical Board of California, not CDPH. Since this
change, there has been significant concern about ensuring
adequate oversight of these outpatient settings and adequate
enforcement mechanisms, as well as the ability to track data
related to ASCs. At this time, surgical clinics that are not
physician-owned can be licensed by CDPH, but physician-owned
ASCs cannot. These ASCs, however, can be certified for
Medicare participation or accredited by MBC-approved agencies.
A prior version of this bill solved this problem by
specifically granting CDPH authority to license surgical
centers owned by physicians, at physician option. It also
required data reporting. However, the bill has been scaled
back significantly and in its current version, it implements
more modest improvements to oversight through the existing
accreditation system.
3)Related Legislation. Numerous attempts have been made since
2007 to improve oversight in the wake of the Capen decision.
Most were unsuccessful, and were either vetoed or did not pass
the Legislature. The April 20, 2015, Senate Business,
Professions, and Economic Development analysis discusses eight
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such efforts from 2006- 2011, and their outcomes.
SB 100 (Price), Chapter 645, Statutes of 2011, made a number
of changes to the approval, oversight, and inspection of
outpatient settings, added in vitro fertilization clinics to
the oversight regime, and required MBC to promulgate
regulations to address issues related to lasers in cosmetic
surgery.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081