BILL ANALYSIS
AB 1174
Page 1
Date of Hearing: May 6, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1174 (Hernandez) - As Amended: April 2, 2009
Policy Committee: HealthVote:18-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill significantly increases and codifies Medi-Cal
reimbursement rates for emergency and non-emergency basic life
support (BLS) and advanced life support (ALS) transportation.
Specifically, this bill:
1)Establishes the following maximum reimbursement rates for
ambulance transportation services:
a) Ground mileage, per mile $7
b) Advanced life support, non-emergency transport $369
c) Advanced life support, emergency transport, Level 1$584
d) Basic life support, non-emergency transport $307
e) Basic life support, emergency transport $492
f) Advanced life support, Level 2 $845
g) Specialty care transport $999
2)Requires the California Department of Health Care Services
(DHCS) to adjust the rates described above annually and in
accordance with the California Consumer Price Index (CPI).
3)Establishes a "prudent layperson" standard for ambulance
transportation to conform to other areas of Medi-Cal. Defines
"Advanced Life Support, Level 2".
FISCAL EFFECT
1)Annual increased fee-for-service (FFS) Medi-Cal costs of $70
million (50% GF) to $90 million (50% GF) to increase base
rates for ground by two- or three-fold. An additional increase
in Medi-Cal managed care costs and capitation pressures of $20
million (50% GF).
2)Annual increased Medi-Cal costs of $5 million (50% GF) to
provide rate increases required by the bill in accordance with
AB 1174
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the state CPI which is approximately 3%. Such CPI adjustments
would raise total spending by an increasing amount over time.
COMMENTS
1)Rationale . This bill is sponsored by the California Ambulance
Association (CAA) to codify increased rates related to
emergency ground and air transports for Medi-Cal
beneficiaries. According to the author, California's
ambulance services are in crisis due to increased costs and
decreased reimbursement across all markets and payers.
Medi-Cal reimbursements are approximately one-third of
provider costs, according to CAA. According to the sponsor,
several pressures have contributed to cost increases in the
past decade. Pressures cited are: a) wages and benefits have
increased 65%, b) insurance costs have increased 40%, and c)
equipment costs have increased 32%.
2)Low Reimbursement Contributes to Weakening Emergency Response .
According to providers, funding shortfalls have eroded
emergency medical services in California, impacting the level
and timeliness of care and exacerbating hospital diversions
and closures throughout the state. Providers argue that if
inadequate reimbursement rates and coverage restrictions
continue unchecked, emergency medical transportation providers
will likely reduce or eliminate care or require subsidies to
continue providing care. Medi-Cal provides ambulance and other
medical transportation only when ordinary public or private
transport is not appropriate and transportation is required
for obtaining needed medical care. Medi-Cal reimburses at a
BLS rate and does not account for ALS transport, which is the
most common mode of transport statewide, due to staffing
configurations. Maximum Medi-Cal base reimbursement ranges
from $118 to $128. Providers indicate actual costs are
approximately $583.
3)Transport Mandate Under EMTALA . Ambulance providers, unlike
many other Medi-Cal providers, are mandated to care for those
who require services. Providers such as physicians, dentists,
and surgeons may simply reject Medi-Cal patients. Ambulance
providers cannot. The Emergency Medical Treatment and Active
Labor Act (EMTALA), enacted in 1986, prohibits the practice of
patient dumping, treatment denial, and patient discharge based
on anticipated high emergency treatment costs. The mandate to
treat psychiatric and other emergency medical needs is
included in EMTALA transport and treatment mandates. Hospitals
are required to provide appropriate screening examinations to
determine whether emergency medical conditions exist,
AB 1174
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regardless of patients' ability to pay. When emergency medical
needs are identified, EMTALA requires hospitals to stabilize
patients.
4)Medi-Cal Lowest California Emergency Medical Transport Payer .
The sponsor of this bill provides the following comparison of
payer categories and patient distributions, based on data
recently published by the Government Accounting Office (GAO) :
Annual California Ambulance Patient Transport and Reimbursement
-----------------------------------------------
|Payment |# of |% of |Reimbursemen|
|Source |transports|transports |t |
| | | | |
|-----------+----------+-----------+------------|
|Medicare | 379,000 | 35% |$ |
| | | |521 |
|-----------+----------+-----------+------------|
|Medi-Cal | 279,214 | 21% | $ 118 |
|-----------+----------+-----------+------------|
|Facility | 89,000 | 8% | $ 723 |
|-----------+----------+-----------+------------|
|Private | 194,000 | 18% | $ 201 |
|pay | | | |
|-----------+----------+-----------+------------|
|Other | 192,000 | 18% | $1,100 |
|insurers | | | |
|-----------+----------+-----------+------------|
|Other | 2,000 | < 1% |$ |
| | | |220 |
-----------------------------------------------
5)Related Legislation . AB 1153 (Beall), pending in this
committee, levies an additional $3 penalty on specified fines,
penalties and forfeitures to support the Emergency Air Medical
Transportation Act to support medical transportation services.
AB 511 (De La Torre), pending in this committee, establishes a
5.5% quality assurance fee (QAF) on ambulance transportation
service providers to increase Medi-Cal rates paid to ambulance
providers.
Analysis Prepared by : Mary Ader / APPR. / (916) 319-2081