BILL ANALYSIS
AB 523
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Date of Hearing: April 14, 2009
ASSEMBLY COMMITTEE ON HEALTH
Dave Jones, Chair
AB 523 (Huffman) - As Introduced: February 25, 2009
SUBJECT : Hospitals: seismic safety.
SUMMARY : Permits the Marin Healthcare District to request from
the Office of Statewide Health Planning and Development (OSHPD)
a two-year extension to current seismic safety retrofit
deadlines to allow them to conduct necessary reviews and submit
design plans for retrofitting of hospital buildings. Contains
an urgency clause to ensure that the provisions of this bill go
into immediate effect upon enactment. Specifically, this bill :
1)Permits a hospital that has received an extension of the
January 1, 2008 deadline to request an additional extension of
up to two years for a hospital building that it owns or
operates and that meets specified criteria.
2)Permits OSHPD to grant the additional extension if the
hospital building subject to the extension meets the following
criteria:
a) Owned by a health care district that has, as owner,
received the extension of the January 1, 2008, deadline;
b) Operated by an unaffiliated third party lessee pursuant
to a facility lease that extends at least through December
31, 2009;
c) Will not be operated by an unaffiliated third party
lessee beyond December 31, 2010; and,
d) Has requested an extension of the deadline by March 1,
2010.
3)Requires the health care district to file a declaration with
OSHPD with the extension request stating that, as of the date
of filing, the district has lacked, and continues to lack,
unrestricted access to the subject hospital building for
seismic planning purposes during the term of the lease, and
that the district is under contract with the county to
maintain hospital services when the hospital comes under
district control.
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4)Requires that any extension granted in accordance with this
bill will apply only to the health care district applicant and
its affiliated hospital while the hospital is operated by the
district or an entity affiliated with the district.
5)Contains an urgency clause necessary for the immediate
preservation of the public peace, health, or safety and will
take effect immediately upon enactment.
EXISTING LAW
1)Establishes and grants OSHPD approval authority over the
construction of health care facilities.
2)Establishes the Alfred E. Alquist Hospital Facilities Seismic
Safety Act (Act), and its amendments, which require:
a) After January 1, 2008, any general acute care hospital
building that is determined to be a potential risk for
collapse or significant loss of life to only be used for
nonacute care hospital purposes. Authorizes a delay to be
granted by OSHPD upon a demonstration that compliance will
result in a loss of health care capacity;
b) OSHPD to authorize extensions to the deadline described
in 2) a) above if the hospital agrees that by January 1,
2013, designated services will be provided by moving into
an existing conforming building, relocating to a
newly-built building, or continuing in the retrofitted
building, as specified, and permits an additional two-year
extension under certain circumstances;
c) OSHPD to authorize extensions to the deadline described
in 2 a) and b)above to the year 2020, by filing a
declaration with OSHPD that the owner lacks financial
capacity to comply with the law;
d) No later than January 1, 2030, owners of all acute care
inpatient hospitals to demolish, replace, or change
non-acute care use of all hospital buildings not in
substantial compliance, and to seismically retrofit all
acute care inpatient hospital buildings so that they are in
substantial compliance; and,
e) Any hospital eligible for an extension described in 2)
a) and b) above to meet the January 1, 2030 deadline.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
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COMMENTS :
1)PURPOSE OF THIS BILL . According to the author's office, Marin
General Hospital, located in Greenbrae California, is
currently operated under lease by Sutter Health, but operation
of the hospital will transition back to Marin Healthcare
District control in 2010. The author maintains that Sutter
Health has not begun the structural upgrades and retrofitting
necessary to be seismically compliant because they do not
intend to operate the hospital beyond 2010. As a consequence,
the author argues that the Marin Healthcare District is now
faced with a short time frame to complete the process of
approving architectural designs, conducting environmental and
safety studies, and completing construction. The author
states that Marin General Hospital is the county's safety net
hospital and the largest acute care hospital in the county.
The author argues the loss of Marin General Hospital would
create a severe shortage of acute care services for all
residents of Marin County and would result in the loss of the
county's only trauma, obstetrics and inpatient mental health
services.
2)BACKGROUND . California's hospital seismic safety law, SB 1953
(Alquist), Chapter 740, Statutes of 1994, was passed by the
Legislature a few months after the Northridge earthquake. SB
1953 revised legislation enacted in 1971 following the Sylmar
earthquake. SB 1953 requires every hospital building to
comply with two deadlines. By January 1, 2008 (or no later
than January 1, 2013, if an extension has been granted), every
hospital building must meet specific construction standards
established to keep these structures standing after a major
earthquake. By January 1, 2030, the law requires all hospital
buildings to comply with standards intended to keep these
buildings operational following a severe quake.
Based on an April 2001 survey by OSHPD, approximately 40% of the
state's 2,700 hospital buildings must either be retrofitted or
rebuilt to meet the 2008 and 2013 construction standards.
Those buildings that don't meet this requirement must be
closed to patient care. A 2007 RAND study commissioned by the
California HealthCare Foundation indicates that the pace of
compliance efforts has been very slow and that total
construction costs to rebuild facilities will range from $45
billion to $110 billion. CHCF points out that the costs
estimates include significant modernization and redesign of
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facilities 50 years old or older and are not solely
attributable to seismic safety compliance.
On November 14, 2007 the California Building Standards
Commission approved the implementation of a state-of-the-art
risk technology, HAZUS (Hazards U.S. Multi-Hazard), to
reexamine the seismic risk of Structural Performance
Category-1 (SPC-1) hospital buildings. These buildings are
considered at risk of collapse in the event of an earthquake
or other natural disaster and must be retrofitted, replaced,
or removed from providing acute care services by 2013. This
reassessment allows OSHPD to reprioritize SPC-1 hospital
buildings based on their level of seismic risk and if they
meet specified criteria, move the building to SPC-2 category.
If reclassified, these hospital buildings would move from a
2008 and 2013 seismic deadline to a 2030 deadline. It is
estimated that 50% to 60% of the 1100 SPC-1 buildings would
qualify for the reclassification under the new HAZUS
methodology.
According to OSHPD, as of July 2008, California hospitals have
submitted approximately 250 buildings for HAZUS reevaluation.
OSHPD's Facilities Development Division has completed 125
evaluations with another 125 in progress. Of the completed
building (or 54.4% of the buildings) moved from the SPC-1
designation to the SPC-2 designation. Fifty-one buildings (or
40.8%) of the SPC-1 buildings tested remained in that
category. According to OSHPD, the final filing date for HAZUS
reevaluation is July 1, 2009.
3)SUPPORT . The Association of California Healthcare Districts
(ACHD) and the American Federation of State, County and
Municipal Employees (AFSCME) both support this bill. AFSCME
states that they support the Legislature's attempt to increase
the safety of acute care hospital patients who are at risk of
seismic disasters. ACHD maintains that the request for a
two-year extension for Marin General Hospital is in the best
interest of patients.
4)PREVIOUS AND RELATED LEGISLATION .
a) AB 303 (Beall) allows specified county and University of
California disproportionate share hospitals that contract
with the California Medical Assistance Commission to serve
Medi-Cal patients to receive supplemental Medi-Cal
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reimbursement from the Construction and Renovation
Reimbursement Program for new capital projects to meet
state seismic safety deadlines for which plans have been
submitted to the state after January 1, 2007 and before
December 31, 2011.
b) SB 306 (Ducheny), Chapter 642, Statutes of 2008, amends
the Act to permit hospitals to delay compliance with the
July 1, 2008 seismic retro deadline, and the 2013
extension, to the year 2020, by filing a declaration with
OSHPD that the owner lacks financial capacity to comply
with the law.
c) SB 1661 (Cox), Chapter 693, Statutes of 2006, authorizes
an extension of up to an additional two years for hospitals
that have already received extensions of the January 1,
2008 seismic safety compliance deadline if specified
criteria are met, and requires specified hospital reports
to be posted on the website of OSHPD.
d) SB 167 (Speier), of 2005, would have amended the Act to
permit delays of the 2008 seismic safety deadline for
specified hospitals that do not exceed maximum allowable
seismic risk, as determined by OSHPD, and expedited the
final compliance deadline to 2020 for hospitals granted the
delay. SB 167 failed passage in the Assembly Health
Committee.
e) AB 1978 (Walters), of 2005, would have extended, from
January 1, 2008 to January 1, 2015, the deadline for any
general acute care hospital building determined to be a
potential risk of collapse or pose significant loss of life
to only be used for nonacute care purposes, and permitted
hospitals subject to the 2015 deadline to request
additional extensions to 2020, as specified. AB 1978
failed passage in the Assembly Health Committee.
f) AB 1673 (Nation and Richman), of 2005, would have
repealed provisions of the Act that require specified
hospitals to meet seismic retrofitting requirements by
2008, revised the final 2030 deadline requirement to 2020,
and made the bill contingent upon the enactment of AB 1672
(Nation) relating to electronic medical recordkeeping. AB
1673 failed passage in the Assembly Health Committee.
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g) SB 1953 (Alquist), Chapter 740, Statutes of 1994,
requires every hospital building to comply with two
deadlines. By January 1, 2008 (or no later than January 1,
2013, if an extension has been granted), every hospital
building must meet specific construction standards
established to keep these structures standing after a major
earthquake. By January 1, 2030, the law requires all
hospital buildings to comply with standards intended to
keep these buildings operational following a severe quake.
5)IMPACT OF THIS BILL . As this bill is drafted, it will likely
apply only to one facility, Marin General Hospital. This bill
will allow Marin General to qualify for one additional two-
year extension of seismic deadlines from 2013 to 2015. Senate
Bill 306 (Ducheny) authorized qualified hospital owners,
including city or county hospitals or hospitals that meet
strict financial hardship criteria, to receive a seven year
extension from the 2013 seismic safety deadline and instead
requires qualifying hospitals to replace those buildings by
January 1, 2020. According to OSHPD, Marin General applied
for the SB 306 extension but was denied because it failed to
meet the financial criteria.
REGISTERED SUPPORT / OPPOSITION :
Support
Association of California Healthcare Districts
American Federation of State, County and Municipal Employees,
AFL-CIO
Opposition
None on file.
Analysis Prepared by : Tanya Robinson-Taylor / HEALTH / (916)
319-2097