BILL ANALYSIS Ó
SB 1300
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SENATE THIRD READING
SB
1300 (Hernandez)
As Amended August 19, 2016
2/3 vote. Urgency
SENATE VOTE: 36-1
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Health |16-0 |Wood, Maienschein, | |
| | |Bonilla, Burke, | |
| | |Campos, Chiu, Gomez, | |
| | |Roger Hernández, | |
| | |Lackey, Olsen, | |
| | |Patterson, | |
| | | | |
| | | | |
| | |Ridley-Thomas, | |
| | |Rodriguez, Santiago, | |
| | |McCarty, Waldron | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Appropriations |19-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, Bonta, | |
| | |Calderon, Daly, | |
| | |Eggman, Gallagher, | |
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| | | | |
| | | | |
| | |Eduardo Garcia, | |
| | |Holden, Jones, | |
| | |Obernolte, Quirk, | |
| | |Santiago, Wagner, | |
| | |Weber, Wood, McCarty | |
| | | | |
| | | | |
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SUMMARY: Establishes the Medi-Cal Emergency Medical
Transportation Reimbursement Act which assesses an annual
quality assurance fee (QAF) on providers of emergency medical
transportation (EMT) in accordance with a prescribed methodology
beginning on July 1, 2017, and continuing each state fiscal
quarter. Applies the QAF to three EMT billing codes.
Specifically, this bill:
1)Excludes from the definition of EMTs air ambulance providers,
or transportation provided by taxicabs, litter vans,
wheelchair vans, or other forms of public or private
conveyances, as specified.
2)Requires each EMT provider, on or before November 15, 2016, to
report to the Department of Health Care Services (DHCS) data
on the number of actual EMTs by payor type, including, without
limitation, Medi-Cal fee-for-service (FFS) EMTs and Medi-Cal
managed care (MCMC) EMTs, and gross receipts from the
provision of EMTs provided each quarter from July 1, 2015, to
October 31, 2016, in a manner prescribed by DHCS.
3)Requires each EMT provider, commencing with the fiscal quarter
beginning on January 1, 2017, and each fiscal quarter
thereafter, on or before the 45th day of the quarter, to
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report to DHCS data on the number of actual EMTs by payor
type, as specified, and gross receipts from the provision of
EMTs provided in the quarter preceding the quarter in which
the report is due, in an manner and format prescribed by DHCS.
4)Authorizes DHCS to establish an Internet Web site for the
submission of the required reports specified in 2) and 3)
above.
5)Permits DHCS to require certification by each EMT under
penalty of perjury of the truth of the reports required in 2)
and 3) above. Authorizes DHCS, upon written notice to an EMT
provider, to impose a penalty of $100 per day that an EMT
provider fails to make a report, as specified. Provides that
failure to make the report within 90 days of the date upon
which the report was due is considered a licensure violation,
as specified.
6)Requires, on or before June 15, 2017, and each June 15
thereafter, the DHCS Director to calculate the annual QAF rate
applicable to the following state fiscal year based on the
most recently collected data collected from EMT providers (See
2) and 3) above), and publish the annual QAF rate on its
Internet Web site.
7)Prohibits the fees calculated and collected from exceeding the
amounts allowed under federal law, and authorizes the Director
of DHCS to reduce the fees as necessary to comply with the
amounts allowable under federal law, as specified. Specifies
calculations of the QAF rate as follows:
a) Calculate the QAF rate for state fiscal year (FY)
2017-18 by multiplying the projected total annual gross
receipts for all EMT providers subject to the fee by 5.1%,
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the resulting product to be divided by the projected total
annual EMTs by all EMT providers subject to the fee for the
state FY; and,
b) For state FY 2018-19 and thereafter, the QAF shall be
calculated by a ratio, the numerator of which shall be the
sum of the product of the projected aggregate fee schedule
amount and the effective state medical assistance
percentage, and the amount of DHCS staffing and
administrative costs, as specified, and the denominator of
which shall be 90% of the projected total annual EMTs by
all EMT providers subject to the fee for the state FY.
8)Establishes a staggered schedule for payment of the fee
relative to the number of Medi-Cal FFS EMT that is rendered,
as specified.
9)Requires each EMT provider subject to the fee to remit to DHCS
an amount equal to the annual QAF rate on specified
timeframes. Authorizes DHCS to assess interest not paid on
the due dates at the greater of 10% per annum or the rate at
which DHCS assesses interest on Medi-Cal program overpayments
to hospitals that are not repaid when due.
10)Authorizes DHCS, if any fee is more than 60 days overdue to
deduct any unpaid fee and interest owed from any Medi-Cal
reimbursement payments owed to the provider until the full
amount of the fee, interest and any penalties assessed are
recovered. Requires DHCS to give the provider written
notification of the deduction which could be deducted over a
period of time taking into account the financial condition of
the provider. Assesses an additional penalty if a payment is
not received after 60 days.
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11)Establishes the Medi-Cal Emergency Transport Fund for
purposes of the QAF raised in this bill and provides funding
for health care coverage, in the following order of priority:
a) To pay for the DHCS's staffing and administrative costs
for implementation of this bill, not to exceed the
following: i) $1,0003,000 in 2016-17; and, ii) $374,000 in
2017-18 and annually thereafter;
b) To pay for the health care coverage in each FY in the
amount of 10% of the projected quality assurance fee
revenue for that FY, as calculated by DHCS on or before
June 15 preceding that FY, exclusive of any federal
matching funds; and,
c) To make increased payments to EMT providers.
12)Increases, effective July 1, 2017, the Medi-Cal FFS payment
schedule governing reimbursement to EMT providers for EMTs.
Requires the increase to the FFS payment schedule to: a) be
calculated on or before June 15, 2017, and to remain the same
for later fiscal years; and, b) apply only to those billing
codes identified in, or any equivalent, predecessor, or
successor billing codes as may be determined by the Director.
13)Requires DHCS to calculate the projections based on data
submitted pursuant to 2) and 3) above. Specifies the payment
schedule amounts.
14)Requires the FFS and MCMC payment schedule increase to be
funded solely from the QAF, and federal reimbursement and any
other related federal funds.
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15)Establishes provisions for delayed payment of the QAF if
there is a delay in the implementation of this bill for any
reason, including a delay in any required approval of the QAF
and the reimbursement methodology. Includes in these
provisions retroactive fees and the authority for DHCS to make
retroactive payment of supplemental rates.
16)Authorizes the DHCS Director to adopt regulations as are
necessary to implement this bill. Authorizes adoption of
regulations as emergency regulations, as specified.
17)Requires DHCS to request approval from the federal Centers
for Medicare and Medicaid Services (CMS) for the use of fees
collected for the purpose of receiving federal matching funds.
18)Authorizes the DHCS Director to alter the methodology to the
extent necessary to meet the requirements of federal law or to
obtain federal approval. Requires the DHCS Director to
execute a declaration if an alteration is necessary.
19)Authorizes the DHCS Director to add categories of exempt EMT
providers or apply a nonuniform fee per transport to EMT
providers that are subject to the fee in order to meet
requirements of federal law or regulations.
20)Implements this bill only if all of the following conditions
are met:
a) The CMS does not determine that the QAF may not be used
for the purposes set forth in this bill;
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b) The state receives federal approval for the increased
FFS payment schedule increases; and,
c) The state continues its maintenance of effort for the
level of state funding of EMT reimbursement for the 2017-18
rate year, and for every subsequent rate year, in an amount
no less than the amount that the state would have paid for
the same number of emergency medical transports under the
rate methodology that was in effect on July 31, 2016.
21)Ceases implementation of this bill if one of the following
conditions is satisfied:
a) CMS no longer allows the use of the provider assessment;
b) The Medi-Cal FFS payment schedule increase no longer
remains in effect;
c) The QAF assessed and collected is no longer available;
d) A final judicial determination by the California Supreme
Court or any California Court of Appeal that the revenues
collected pursuant to this article that are deposited in
the Fund are considered subject to be proceeds of taxes
within the meaning of Proposition 98, or,
e) The state does not continue its maintenance of effort
for the level of state funding of EMT reimbursement for the
2017-18 rate year, and for every subsequent rate year, as
specified.
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22)Makes this bill inoperative in the event of a final judicial
determination made by any state or federal court that is not
appealed, or by a court of appellate jurisdiction that is not
further appealed, in any action by any party, or a final
determination by the administrator of the CMS, that federal
financial participation (FFP) is not available with respect to
any payment made under the methodology implemented under this
bill because the methodology is invalid, unlawful, or contrary
to any provision of federal law or regulations or of state
law.
FISCAL EFFECT: According to the Assembly Appropriations
Committee:
1)One-time costs of $1.2 million and ongoing administrative
costs of $750,000 annually (Medi-Cal Emergency Medical
Transport Fund/General Fund (GF)/federal) for DHCS to develop
regulations, gain federal approval, make any necessary system
changes, oversee collection of the quality assurance fee, and
make increased payments.
2)DHCS states it has been unable to independently verify data
provided by EMT providers. However, based on such data, staff
assumes costs associated with fee collection and payment as
follows:
a) Ongoing GF benefit of about $3 million per year through
reduced health care spending. This bill provides that 10%
of revenue collected (after setting aside administrative
funding) is available to the state for health care
coverage. Thus, this bill reduces the need for GF support
of the Medi-Cal program by an equal amount.
b) Additional payments of about $73 million per year for
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Medi-Cal EMT services (Medi-Cal Emergency Medical Transport
Fund/ federal). The quality assurance fee is projected to
generate about $30 million per year in revenues (after
accounting for administration and state benefits). With
federal matching funds, about $73 million per year would be
paid in increased reimbursements to providers.
1)Unknown GF cost pressure to maintain higher ambulance
transport rates if QAF revenues are eliminated or changed.
COMMENTS: According to the author, this bill increases Medi-Cal
EMT rates by levying a QAF on three EMT reimbursement codes.
The resulting revenue would then be used to draw down additional
federal Medicaid funds to increase Medi-Cal emergency
transportation rates, without imposing a cost to the state GF.
In addition, 10% of revenue raised by the QAF would go to the
state GF. The author argues inadequate Medi-Cal reimbursement
for ambulance transport is a long-standing issue and places a
strain on the state's emergency medical services system.
This bill assesses a QAF on revenue EMT providers receive from
three EMT reimbursement codes (A0429 Basic Life Support
Emergency, A0427 Advanced Life Support (ALS1) Emergency, and
A0433 ALS 2). A QAF rate of 5.1% is assessed for 2017-18
against the gross revenue of all EMT providers from the three
reimbursement codes. After 2017-18, estimates of the QAF rate
provided by the 911 Ambulance Provider's Medi-Cal Alliance, the
sponsor of this bill, are as follows: for 2018-19 the QAF would
be at 5.7%; for 2019-20 it would be 5.8%; and for 2020-21 and
beyond, the rate would be at 5.9%. The increase in the QAF rate
is needed to account for the reduction in the federal match
(known as the Federal Medical Assistance Percentages or FMAP)
for certain populations including adults who became eligible for
Medi-Cal under the optional expansion enacted under the federal
Affordable Care Act.
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Analysis Prepared by:
Rosielyn Pulmano / HEALTH / (916) 319-2097 FN:
0004567