BILL NUMBER: AB 595	CHAPTERED  09/30/94
	BILL TEXT

	CHAPTER   1276
	FILED WITH SECRETARY OF STATE   SEPTEMBER 30, 1994
	APPROVED BY GOVERNOR   SEPTEMBER 30, 1994
	PASSED THE ASSEMBLY   AUGUST 30, 1994
	PASSED THE SENATE   AUGUST 27, 1994
	AMENDED IN SENATE   AUGUST 24, 1994
	AMENDED IN SENATE   AUGUST 15, 1994
	AMENDED IN SENATE   AUGUST 8, 1994
	AMENDED IN SENATE   APRIL 11, 1994
	AMENDED IN SENATE   MARCH 21, 1994
	AMENDED IN SENATE   FEBRUARY 28, 1994
	AMENDED IN SENATE   AUGUST 25, 1993
	AMENDED IN SENATE   AUGUST 23, 1993
	AMENDED IN SENATE   AUGUST 16, 1993
	AMENDED IN SENATE   JULY 12, 1993
	AMENDED IN ASSEMBLY   MAY 19, 1993
	AMENDED IN ASSEMBLY   MAY 6, 1993

INTRODUCED BY  Assembly Member Speier

                        FEBRUARY 18, 1993

   An act to add Article 11.5 (commencing with Section 2215) to
Chapter 5 of Division 2 of the Business and Professions Code,
and to add Chapter 1.3 (commencing with Section 1248) to
Division 2 of the Health and Safety Code, relating to health,
and making an appropriation therefor.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 595, Speier.  Outpatient settings.
   Existing law provides for the licensure and regulation of
clinics, as defined, and health facilities, as defined, by the
State Department of Health Services.
   This bill would prohibit, on and after July 1, 1996, any
physician and surgeon from performing surgery in an outpatient
setting, as defined, using specified anesthesia unless the
setting is one of enumerated health care settings, including a
setting accredited by an accreditation agency, as defined,
approved by the Division of Licensing of the Medical Board of
California.
   This bill would prohibit an association, corporation, firm,
partnership, or person from operating, managing, conducting, or
maintaining an outpatient setting, as defined, unless the
setting is one of those enumerated settings.  This bill would
require the division to adopt standards for accreditation in
accordance with prescribed criteria.
   This bill would require the division to adopt standards for
approval of accreditation agencies to perform accreditation of
outpatient settings.  It would permit the division or
accreditation agency to inspect outpatient settings accredited
by an accreditation agency, and would authorize certain
disciplinary actions to be taken with regard to outpatient
settings and accreditation agencies that are out of compliance
with the requirements of these provisions.  It would require the
division to establish fees for approval of accreditation
agencies.
   The bill would provide that a willful and knowing violation
of these provisions constitutes unprofessional conduct for a
physician and surgeon.
   This bill would create the Outpatient Setting Fund, provide
for the deposit of the accreditation fees into the fund, and
would require funds deposited into this fund to be expended by
the board for the purpose of implementing and administering
these provisions upon appropriation by the Legislature.
   This bill would transfer $150,000 from the Contingent Fund of
the Medical Board to the Outpatient Setting Fund and would
appropriate this amount to the Medical Board, for purposes of
this bill, as a loan to be repaid with interest by January 1,
2003.
   The bill would provide that willful violation of these
provisions is a misdemeanor and would subject a person or entity
that violates these provisions to a fine not to exceed $1,000
per day of violation thereby imposing a state-mandated local
program.  The bill would require the district attorney of a
county to institute and conduct the prosecution of any violation
of these provisions, upon application by the Division of
Medical Quality of the Medical Board of California, thereby
imposing a state-mandated local program by increasing the duties
of local agencies by creating a new crime.
   The bill would further authorize the Division of Medical
Quality of the Medical Board of California or the local district
attorney to bring an action to enjoin a violation or threatened
violation of these provisions in accordance with specified
procedures.
   The bill would authorize the division to adopt regulations to
implement these provisions.
  The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated
by the state.  Statutory provisions establish procedures for
making that reimbursement, including the creation of a State
Mandates Claims Fund to pay the costs of mandates which do not
exceed $1,000,000 statewide and other procedures for claims
whose statewide costs exceed $1,000,000.
   This bill would provide that for certain costs no
reimbursement is required by this act for a specified reason.
   However, the bill would provide that, if the Commission on
State Mandates determines that this bill contains other costs
mandated by the state, reimbursement for those costs shall be
made pursuant to those statutory procedures and, if the
statewide cost does not exceed $1,000,000, shall be payable from
the State Mandates Claims Fund.
   Appropriation:  yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1. Article 11.5 (commencing with Section 2215) is
added to Chapter 5 of Division 2 of the Business and Professions
Code, to read:

      Article 11.5.  Surgery in Certain Outpatient Settings

   2215.  The Legislature finds and declares that in this state,
significant surgeries are being performed in unregulated
out-of-hospital settings.  The Legislature further finds and
declares that without appropriate oversight, some of these
settings may be operating in a manner which is injurious to the
public health, welfare, and safety.  Although the health
professionals delivering health care services in these settings
are licensed, further quality assurance is needed to ensure that
health care services are safely and effectively performed in
these settings.  The Legislature further recognizes that there
is a wide range of surgical procedures safely performed in a
myriad of outpatient settings, and the degree of patient risk
varies greatly.  It is the intent of the Legislature to create
regulations that directly impact patient safety.  It is not the
intent of the Legislature to require standards in excess of
those requirements in Section 1248.15, or to require physical
modifications to facilities unless the modifications or
standards directly impact patient safety and are cost-effective.
  The cost effectiveness of any modifications shall be taken
into consideration by the Division of Licensing of the Medical
Board of California, and shall ensure that the least costly and
effective method of achieving patient safety is required.
   2216.  On or after July 1, 1996, no physician and surgeon
shall perform procedures in an outpatient setting using
anesthesia, except local anesthesia or peripheral nerve blocks,
or both, complying with the community standard of practice, in
doses that, when administered, have the probability of placing a
patient at risk for loss of the patient's life-preserving
protective reflexes, unless the setting is specified in Section
1248.1.  Outpatient settings where anxiolytics and analgesics
are administered are excluded when administered, in compliance
with the community standard of practice, in doses that do not
have the probability of placing the patient at risk for loss of
the patient's life-preserving protective reflexes.
   The definition of "outpatient settings" contained in
subdivision (c) of Section 1248 shall apply to this section.
   2217.  The Division of Licensing of the Medical Board of
California may adopt regulations to implement this article and
Chapter 1.3 (commencing with Section 1248) of Division 2 of the
Health and Safety Code.
  SEC. 2. Chapter 1.3 (commencing with Section 1248) is added to
Division 2 of the Health and Safety Code, to read:

      CHAPTER 1.3.  OUTPATIENT SETTINGS

   1248.  For purposes of this chapter, the following
definitions shall apply:
   (a) "Division" means the Division of Licensing of the Medical
Board of California.
   (b) "Division of Medical Quality" means the Division of
Medical Quality of the Medical Board of California.
   (c) "Outpatient setting" means any facility, clinic,
unlicensed clinic, center, office, or other setting that is not
part of a general acute care facility, as defined in Section
1250, and where anesthesia, except local anesthesia or
peripheral nerve blocks, or both, is used in compliance with the
community standard of practice, in doses that, when
administered have the probability of placing a patient at risk
for loss of the patient's life-preserving protective reflexes.
   "Outpatient setting" does not include, among other settings,
any setting where anxiolytics and analgesics are administered,
when done so in compliance with the community standard of
practice, in doses that do not have the probability of placing
the patient at risk for loss of the patient's life-preserving
protective reflexes.
   (d) "Accreditation agency" means a public or private
organization that is approved to issue certificates of
accreditation to outpatient settings by the division pursuant to
Sections 1248.15 and 1248.4.
   1248.1.  No association, corporation, firm, partnership, or
person shall operate, manage, conduct, or maintain an outpatient
setting in this state, unless  the setting is one of the
following:
   (a) An ambulatory surgical center that is certified to
participate in the Medicare program under Title XVIII (42 U.S.C.
Sec. 1395 et seq.) of the federal Social Security Act.
   (b) Any clinic conducted, maintained, or operated by a
federally recognized Indian tribe or tribal organization, as
defined in Section 450 or 1601 of Title 25 of the United States
Code, and located on land recognized as tribal land by the
federal government.
   (c) Any clinic directly conducted, maintained, or operated by
the United States or by any of its departments, officers, or
agencies.
   (d) Any primary care clinic licensed under subdivision (a)
and any surgical clinic licensed under subdivision (b) of
Section 1204.
   (e) Any health facility licensed as a general acute care
hospital under Chapter 2 (commencing with Section 1250).
   (f) Any outpatient setting to the extent that it is used by a
dentist or physician and surgeon in compliance with Article 2.7
(commencing with Section 1646) or Article 2.8 (commencing with
Section 1647) of Chapter 4 of Division 2 of the Business and
Professions Code.
   (g) An outpatient setting accredited by an accreditation
agency approved by the division pursuant to this chapter.
   (h) A setting, including, but not limited to, a mobile van,
in which equipment is used to treat patients admitted to a
facility described in subdivision (a), (d), or (e), and in which
the procedures performed are staffed by the medical staff of,
or other healthcare practitioners with clinical privileges at,
the facility and are subject to the peer review process of the
facility but which setting is not a part of a facility described
in subdivision (a), (d), or (e).
   Nothing in this section shall relieve an association,
corporation, firm, partnership, or person from complying with
all other provisions of law that are otherwise applicable.
   1248.15.  (a) The division shall adopt standards for
accreditation and, in approving accreditation agencies to
perform accreditation of outpatient settings, shall ensure that
the certification program shall, at a minimum, include standards
for the following aspects of the settings' operations:
   (1) Outpatient setting allied health staff shall be licensed
or certified to the extent required by state or federal law.
   (2) (A) Outpatient settings shall have a system for facility
safety and emergency training requirements.
   (B) There shall be onsite equipment, medication, and trained
personnel to facilitate handling of services sought or provided
and to facilitate handling of any medical emergency that may
arise in connection with services sought or provided.
   (C) In order for procedures to be performed in an outpatient
setting as defined in Section 1248, the outpatient setting shall
do one of the following:
   (i) Have a written transfer agreement with a local accredited
or licensed acute care hospital, approved by the facility's
medical staff.
   (ii) Permit surgery only by a licensee who has admitting
privileges at a local accredited or licensed acute care
hospital, with the exception that licensees who may be precluded
from having admitting privileges by their professional
classification or other administrative limitations, shall have a
written transfer agreement with licensees who have admitting
privileges at local accredited or licensed acute care hospitals.

   (iii) Submit for approval by an accrediting agency, a
detailed procedural plan for handling medical emergencies that
shall be reviewed at the time of accreditation.  No reasonable
plan shall be disapproved by the accrediting agency.
   (D) All physicians and surgeons transferring patients from an
outpatient setting shall agree to cooperate with the medical
staff peer review process on the transferred case, the results
of which shall be referred back to the outpatient setting, if
deemed appropriate by the medical staff peer review committee.
If the medical staff of the acute care facility determines that
inappropriate care was delivered at the outpatient setting, the
acute care facility's peer review outcome shall be reported, as
appropriate, to the accrediting body, the Health Care Financing
Administration, the State Department of Health Services, and the
appropriate licensing authority.
   (3) The outpatient setting shall permit surgery by a dentist
acting within his or her scope of practice under Chapter 4
(commencing with Section 1600) of the Business and Professions
Code or physician and surgeon, osteopathic physician and
surgeon, or podiatrist acting within his or her scope of
practice under Chapter 5 (commencing with Section 2000) of the
Business and Professions Code or the Osteopathic Initiative Act.
  The outpatient setting may, in its discretion, permit
anesthesia service by a certified registered nurse anesthetist
acting within his or her scope of practice under Article 7
(commencing with Section 2825) of Chapter 6 of the Business and
Professions Code.
   (4) Outpatient settings shall have a system for maintaining
clinical records.
   (5) Outpatient settings shall have a system for patient care
and monitoring procedures.
   (6) (A) Outpatient settings shall have a system for quality
assessment and improvement.
   (B) Members of the medical staff and other practitioners who
are granted clinical privileges shall be professionally
qualified and appropriately credentialed for the performance of
privileges granted.  The outpatient setting shall grant
privileges in accordance with recommendations from qualified
health professionals, and credentialing standards established by
the outpatient setting.
   (C) Clinical privileges shall be periodically reappraised by
the outpatient setting.  The scope of procedures performed in
the outpatient setting shall be periodically reviewed and
amended as appropriate.
   (7) Outpatient settings regulated by this chapter that have
multiple service locations governed by the same standards may
elect to have all service sites surveyed on any accreditation
survey.  Organizations that do not elect to have all sites
surveyed shall have a sample, not to exceed 20 percent of all
service sites, surveyed.  The actual sample size shall be
determined by the division.  The accreditation agency shall
determine the location of the sites to be surveyed.  Outpatient
settings that have five or fewer sites shall have at least one
site surveyed.  When an organization that elects to have a
sample of sites surveyed is approved for accreditation, all of
the organizations' sites shall be automatically accredited.
   (b) An accreditation agency may include additional standards
in its determination to accredit outpatient settings if these
are approved by the division to protect the public health and
safety.
   (c) No accreditation standard adopted or approved by the
division, and no standard included in any certification program
of any accreditation agency approved by the division, shall
serve to limit the ability of any  allied healthcare
practitioner to provide services within his or her full scope of
practice.  Notwithstanding this or any other provision of law,
each outpatient setting may limit the privileges, or determine
the privileges, within the appropriate scope of practice, that
will be afforded to physicians and allied health care
practitioners who practice at the facility, in accordance with
credentialing standards established by the outpatient setting in
compliance with this chapter.  Privileges may not be
arbitrarily restricted based on category of licensure.
   1248.2.  (a) Any outpatient setting may apply to an
accreditation agency for a certificate of accreditation.
Accreditation shall be issued by the accreditation agency solely
on the basis of compliance with its standards as approved by
the division under this chapter.
   (b) The division shall obtain and maintain a list of all
accredited, certified, and licensed outpatient settings from the
information provided by the accreditation, certification, and
licensing agencies approved by the division, and shall notify
the public, upon inquiry, whether a setting is accredited,
certified, or licensed, or whether the setting's accreditation,
certification, or license has been revoked.
   1248.25.  If an outpatient setting does not meet the
standards approved by the division, accreditation shall be
denied by the accreditation agency, which shall provide the
outpatient setting notification of the reasons for the denial.
An outpatient setting may reapply for accreditation at any time
after receiving notification of the denial.
   1248.3.  (a) Certificates of accreditation issued to
outpatient settings by an accreditation agency shall be valid
for not more than three years.
   (b) The outpatient setting shall notify the accreditation
agency within 30 days of any significant change in ownership,
including, but not limited to, a merger, change in majority
interest, consolidation, name change, change in scope of
services, additional services, or change in locations.
   (c) Except for disclosures to the division or to the Division
of Medical Quality under this chapter, an accreditation agency
shall not disclose information obtained in the performance of
accreditation activities under this chapter that individually
identifies patients, individual medical practitioners, or
outpatient settings.  Neither the proceedings nor the records of
an accreditation agency or the proceedings and records of an
outpatient setting related to performance of quality assurance
or accreditation activities under this chapter shall be subject
to discovery, nor shall the records or proceedings be admissible
in a court of law.  The prohibition relating to discovery and
admissibility of records and proceedings does not apply to any
outpatient setting requesting accreditation in the event that
denial or revocation of that outpatient setting's accreditation
is being contested.  Nothing in this section shall prohibit the
accreditation agency from making discretionary disclosures of
information to an outpatient setting pertaining to the
accreditation of that outpatient setting.
   1248.35.  (a) The Division of Medical Quality or an
accreditation agency may, upon reasonable prior notice and
presentation of proper identification, enter and inspect any
outpatient setting that is accredited by an accreditation agency
at any reasonable time to ensure compliance with, or
investigate an alleged violation of, any standard of the
accreditation agency or any provision of this chapter.
   (b) If an accreditation agency determines, as a result of its
inspection, that an outpatient setting is not in compliance
with the standards under which it was approved, the
accreditation agency may do any of the following:
   (1) Issue a reprimand.
   (2) Place the outpatient setting on probation, during which
time the setting shall successfully institute and complete a
plan of correction, approved by the division or the
accreditation agency, to correct the deficiencies.
   (3) Suspend or revoke the outpatient setting's certification
of accreditation.
   (c) Except as is otherwise provided in this subdivision,
before suspending or revoking a certificate of accreditation
under this chapter, the accreditation agency shall provide the
outpatient setting with notice of any deficiencies and
reasonable time to supply information demonstrating compliance
with the standards of the accreditation agency in compliance
with this chapter, as well as the opportunity for a hearing on
the matter upon the request of the outpatient center.  The
accreditation agency may immediately suspend the certificate of
accreditation before providing notice and an opportunity to be
heard, but only when failure to take the action may result in
imminent danger to the health of an individual.  In such cases,
the accreditation agency shall provide subsequent notice and an
opportunity to be heard.
   (d) If the division determines that deficiencies found during
an inspection suggests that the accreditation agency does not
comply with the standards approved by the division, the division
may conduct inspections, as described in this section, of other
settings accredited by the accreditation agency to determine if
the agency is accrediting settings in accordance with Section
1248.15.
   1248.4.  (a) It is the intent of the Legislature that an
accreditation agency operating on or before January 1, 1995, and
meeting the standards set forth in this chapter, as determined
by the division, not be required to go through the entire
application process with the division.  Therefore, the division
may grant a temporary certificate of approval to such an
accreditation agency.  The temporary approval issued to an
accreditation agency under this subdivision shall expire on
January 1, 1998.  In order to continue its status as an
accreditation agency, an accreditation agency approved by the
division under this subdivision shall apply for renewal of
approval by the division on or before January 1, 1998, and shall
establish that it is in compliance with the standards set forth
in this chapter and any regulations adopted pursuant thereto.
   (b) Each accreditation agency approved by the division shall,
on and after January 1, 1995, promptly forward to the division
a list of each outpatient setting to which it has granted a
certificate of accreditation, as well as settings that have lost
accreditation or were denied accreditation.
   (c) The division shall approve an accreditation agency that
applies for approval on a form prescribed by the division,
accompanied by payment of the fee prescribed by this chapter and
evidence that the accreditation agency meets the following
criteria:
   (1) Includes within its accreditation program, at a minimum,
the standards for accreditation of outpatient settings approved
by the division as well as standards for patient care and safety
at the setting.
   (2) Submits its current accreditation standards to the
division every three years, or upon request for continuing
approval by the division.
   (3) Maintains internal quality management programs to ensure
quality of the accreditation process.
   (4) Has a process by which accreditation standards can be
reviewed and revised no less than every three years.
   (5) Maintains an available pool of allied health care
practitioners to serve on accreditation review teams as
appropriate.
   (6) Has accreditation review teams that shall do all of the
following:
   (A) Consist of at least one physician and surgeon who
practices in an outpatient setting; any other members shall be
practicing actively in these settings.
   (B) Participate in formal educational training programs
provided by the accreditation agency in evaluation of the
certification standards at least every three years.
   (7) The accreditation agency shall demonstrate that
professional members of its review team have experience in
conducting review activities of freestanding outpatient
settings.
   (8) Standards for accreditation shall be developed with the
input of the medical community and the ambulatory surgery
industry.
   (9) Accreditation reviewers shall be credentialed and
screened by the accreditation agency.
   (10) The accreditation agency shall not have an ownership
interest in nor be involved in the operation of a freestanding
outpatient setting, nor in the delivery of health care services
to patients.
   (d) Accreditation agencies approved by the division shall
forward to the division copies of all certificates of
accreditation and shall notify the division promptly whenever
the agency denies or revokes a certificate of accreditation.
   (e) A certification of an accreditation agency by the
division shall expire at midnight on the last day of a
three-year term if not renewed.  The division shall establish by
regulation the procedure for renewal.  To renew an unexpired
approval, the accreditation agency shall, on or before the date
upon which the certification would otherwise expire, apply for
renewal on a form, and pay the renewal fee, as prescribed by the
division.
   1248.5.  The division may evaluate the performance of an
approved accreditation agency no less than every three years, or
in response to complaints against an agency, or complaints
against one or more outpatient settings accreditation by an
agency that indicates noncompliance by the agency with the
standards approved by the division.
   1248.55.  (a) If the accreditation agency is not meeting the
criteria set by the division, the division may terminate
approval of the agency.
   (b) Before terminating approval of an accreditation agency,
the division shall provide the accreditation agency with notice
of any deficiencies and reasonable time to supply information
demonstrating compliance with the requirements of this chapter,
as well as the opportunity for a hearing on the matter in
compliance with Chapter 5 (commencing with Section 11500) of
Part 1 of Division 3 of Title 2 of the Government Code.
   (c) (1) If approval of the accreditation agency is terminated
by the division, outpatient settings accredited by that agency
shall be notified by the division and, except as provided in
paragraph (2), shall be authorized to continue to operate for a
period of 12 months in order to seek accreditation through an
approved accreditation agency, unless the time is extended by
the division for good cause.
   (2) The division may require that an outpatient setting, that
has been accredited by an accreditation agency whose approval
has been terminated by the division, cease operations
immediately in the event that the division is in possession of
information indicating that continued operation poses an
imminent risk of harm to the health of an individual.  In such
cases, the division shall provide the outpatient setting with
notice of its action, the reason underlying it, and a subsequent
opportunity for a hearing on the matter.  An outpatient setting
that is ordered to cease operations under this paragraph may
reapply for a certificate of accreditation after six months and
shall notify the division promptly of its reapplication.
   1248.6.  (a) The Division of Licensing shall establish by
regulation a reasonable fee for an application for approval as
an accreditation agency in an amount that is reasonably
necessary to recover the cost of implementing and administering
this chapter, and not to exceed five thousand dollars ($5,000).
The division shall establish by regulation a reasonable fee for
a temporary certificate of approval, as outlined in subdivision
(a) of Section 1248.4, not to exceed two thousand dollars
($2,000).  The division shall also establish a reasonable fee
for renewal.  The renewal fee shall be proportionate to the
number of outpatient settings accredited by the approved
accrediting body seeking renewal, and shall not exceed one
hundred dollars ($100) per outpatient setting accreditation
reviewed.
   (b) All fees paid to and received by the division or the
Medical Board of California under this chapter shall be paid
into the State Treasury and shall be credited to a special fund
that is hereby created as the Outpatient Setting Fund of the
Medical Board of California.  Funds in the Outpatient Setting
Fund of the Medical Board of California shall be expended by the
board for the purpose of implementing and administering this
chapter upon appropriation by the Legislature.  No surplus in
the fund shall be deposited in or transferred to the General
Fund or any other fund.
   1248.65.  It shall constitute unprofessional conduct for a
physician and surgeon to willfully and knowingly violate this
chapter.
   1248.7.  The Division of Medical Quality or the local
district attorney may bring an action to enjoin a violation or
threatened violation of this chapter in the superior court in
and for the county in which the violation occurred or is about
to occur.  Any proceeding under this section shall conform to
the requirements of Chapter 3 (commencing with Section 525) of
Title 7 of Part 2 of the Code of Civil Procedure, except that
the Division of Medical Quality shall not be required to allege
facts necessary to show or tending to show lack of adequate
remedy at law or irreparable damage or loss.
   With respect to any and all actions brought pursuant to this
section alleging an actual or threatened violation of any
requirement of this chapter, the court shall, if it finds the
allegations to be true, issue an order enjoining the person or
facility from continuing the violation.
   1248.75.  (a) Except as may otherwise be provided in this
section, before the Division of Medical Quality may seek an
injunction as provided under Section 1248.7, the Division of
Medical Quality shall notify the outpatient setting of all
deficiencies in its compliance with this chapter, and any rules
and regulations adopted pursuant to this chapter, and the
Division of Medical Quality and the outpatient setting shall
reach an agreement upon a plan of correction that shall give the
outpatient setting reasonable time to correct the deficiencies.
  The Division of Medical Quality shall also inform the
outpatient setting that failure to reach an agreement or to
correct deficiencies may lead to corrective action by the
Division of Medical Quality, which may include imposition of
fines under Section 1248.8.  If at the end of the allotted time
the division and the outpatient setting have failed to reach an
agreement or the outpatient setting has failed to correct the
deficiencies, as revealed by inspection, the Division of Medical
Quality may take corrective action to include, as appropriate,
seeking an injunction under Section 1248.7, revoking or
requesting that the accreditation agency revoke accreditation,
or communicating with any agency that has oversight authority
over the outpatient setting, such as the Department of Health
Services or other appropriate licensing authority, to request
that the agency take corrective action against the outpatient
setting.
   (b) For purposes of this section, and at the sole discretion
of the Division of Medical Quality, any notifications,
inspections, and corrective action plans of the Division of
Medical Quality relating to outpatient settings that have been
accredited by an accreditation agency may be performed or
coordinated by the accreditation agency rather than by the
Division of Medical Quality.
   (c) If the Division of Medical Quality determines that an
outpatient setting poses an immediate and substantial hazard to
the health or safety of the
        patient, that may not reasonably be corrected through a
plan of correction, the Division of Medical Quality may
immediately institute injunction proceedings pursuant to Section
1248.7.
   1248.8. (a) Any person or entity that willfully violates this
chapter or any rule or regulation adopted under this chapter
shall be guilty of a misdemeanor and subject to a fine not to
exceed one thousand dollars ($1,000) per day of violation.
   (b) In determining the punishment to be imposed under this
section, the court shall consider all relevant facts, including,
but not limited to, the following:
   (1) Whether the violation exposed a patient or other
individual to the risk of death or serious physical harm.
   (2) Whether the violation had a direct or immediate
relationship to health, safety, or security of a patient or
other individual.
   (3) Evidence, if any, of willfulness in the violation.
   (4) The presence or absence of good faith efforts by the
outpatient setting to prevent the violation.
   (c) For purposes of this section, "willfully" or "willful"
means that the person doing an act or omitting to do an act
intends the act or omission, and knows the relevant
circumstances connected with the act or omission.
   (d) The district attorney of every county shall, upon
application by the Division of Medical Quality or its authorized
representative, institute and conduct the prosecution of any
action or violation within the county of any provisions of this
chapter.
   1248.85.  Nothing in this chapter shall preclude an approved
accreditation agency from adopting additional standards
consistent with Section 1248.15, establishing procedures for the
conduct of surveys, selecting surveyors to perform
accreditation surveys, or establishing and collecting reasonable
fees for the conduct of accreditation surveys.
  SEC. 3. The sum of one hundred fifty thousand dollars
($150,000) is transferred from the Contingent Fund of the
Medical Board of California to the Outpatient Setting Fund of
the Medical Board of California, and is hereby appropriated to
the board for the purposes of this act, which sum shall be a
loan to be repaid to the Contingent Fund of the Medical Board of
California with interest at the rate earned by moneys invested
in the Pooled Money Investment Account.  The entire sum, plus
interest, shall be repaid by January 1, 2003.
  SEC. 4. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution for
those costs which may be incurred by a local agency or school
district because this act creates a new crime or infraction,
changes the definition of a crime or infraction, changes the
penalty for a crime or infraction, or eliminates a crime or
infraction.
   However, notwithstanding Section 17610 of the Government
Code, if the Commission on State Mandates determines that this
act contains other costs mandated by the state, reimbursement to
local agencies and school districts for those costs shall be
made pursuant to Part 7 (commencing with Section 17500) of
Division 4 of Title 2 of the Government Code.  If the statewide
cost of the claim for reimbursement does not exceed one million
dollars ($1,000,000), reimbursement shall be made from the State
Mandates Claims Fund.  Notwithstanding Section 17580 of the
Government Code, unless otherwise specified in this act, the
provisions of this act shall become operative on the same date
that the act takes effect pursuant to the California
Constitution.