BILL ANALYSIS
AB 1503
Page 1
Date of Hearing: April 21, 2009
ASSEMBLY COMMITTEE ON HEALTH
Dave Jones, Chair
AB 1503 (Lieu) - As Introduced: February 27, 2009
SUBJECT : Emergency medical care: billing.
SUMMARY : Requires emergency room physicians (physician), in
order to bill patients who do not have coverage for emergency
care and services, as specified, to have a discount payment
policy that meets the requirements of this bill, and revises the
conditions under which physicians may bill for uncompensated
care payments through the Maddy Emergency Medical Services Fund
(Maddy Fund). Specifically, this bill :
1)Requires physicians seeking payment for services through the
Maddy Fund to have and implement a discount payment policy
which complies with the requirements of this bill.
2)Requires a physician billing for payment from the Maddy Fund
to seek patient financial information from the hospital as to
whether the patient has provided information indicating that
the patient may qualify for the hospital's charity care
payment policy, and, if the patient qualifies for the
hospital's charity care or discount payment policy, authorizes
the physician to bill the Maddy Fund.
3)Requires, if a physician receives payment from the Maddy Fund,
the physician to take no further action to collect payment
from the patient.
4)If the Maddy Fund does not reimburse the physician, authorizes
the physician to bill a patient consistent with the provisions
of this bill.
5)Makes uninsured patients, and patients with incomes below 350%
of the Federal Poverty Level with medical costs exceeding 10%
of their income, eligible to apply for a discount payment from
the physician, and requires the physician to limit the
expected payment for services from an eligible patient to the
amount of payment the physician would expect to receive for
services to eligible patients through Medicare, Medi-Cal, the
Healthy Families Program or another governmental program,
whichever is greater.
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6)Permits physicians to grant additional eligibility for
discounted services to patients with higher incomes.
7)Requires a patient requesting a discounted payment to provide
the billing physician with necessary and reasonable
information to make an eligibility determination, and
prohibits the use of this information for collections
activities.
8)Requires physicians to provide patients receiving emergency
care, but who are not admitted to the hospital, with specified
written notice describing the availability of a discount
program and the eligibility standards for that program.
Requires the notice to be in English and other languages, as
specified.
9)Requires patients to inform the physician regarding
eligibility for any private or public insurance available to
cover the physician's charges and requires physicians to
inform patients of potential sources of public insurance and
the qualifications for discounted services through a written
notice.
10)Requires a physician to establish a written policy stating
the physician's standards and procedures for collection of
debt and to provide this policy to eligible patients.
11)Prohibits a physician from reporting adverse information for
eligible patients to a consumer credit agency for 150 days
after the initial billing.
12)Prohibits wage garnishments or liens, and prohibits sale of a
patient's home during their lifetime, as a means of collecting
debts for persons participating in the discounted cost
program.
13)Prohibits sending unpaid bills to collection if an eligible
individual is making a good faith effort to settle an
outstanding bill.
14)Authorizes physicians or assignees to seek reimbursement of
discounted services from other third parties.
15)Requires any extended repayment plans offered to discounted
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patients by a physician to be interest free.
16)Specifies that this bill does not diminish or eliminate any
protections consumers have under federal or state debt
collection laws and specifies the terms for initiating
collection activities against qualified individuals.
17)Requires physicians to reimburse the patient or patients any
amount paid in excess of the amount permitted under this bill,
with interest.
18)Clarifies that the amounts paid under the discounted payment
policy do not constitute a physician's customary charges and
further specifies a violation of this article does not
constitute a violation of the terms of a physician's
licensure.
EXISTING LAW :
1)Authorizes each county to establish a Maddy Fund and specifies
that the fund be used to reimburse hospitals and physicians
for uncompensated emergency medical services.
2)Requires each hospital, as a condition of licensure, to
maintain policies providing reduced cost care, as defined, to
uninsured and low income individuals.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . Health Access California, sponsor of
this bill, states the intent of this legislation is to provide
uninsured and underinsured consumers affordable physician care
in emergency rooms and to provide consumer protections from
overly aggressive collections activity. Uninsured
individuals, according to Health Access, treated in emergency
rooms, are frequently charged more than insured patients are
charged for the same service. Health Access also reports that
debt collections from uninsured patients are routinely and
vigorously employed to recover medical debt. The author notes
that this bill is modeled on a very similar program instituted
in hospitals last year.
AB 1503
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2)MADDY FUND . Existing law authorizes each county to establish
a Maddy Fund. After the costs of administration are deducted,
the Maddy Fund is required to reimburse physicians and
hospitals for uncompensated emergency medical care and for
other emergency medical services determined by each county.
Approximately 50 counties have established Maddy Funds.
Counties finance these funds through several revenue sources,
including penalty assessments on certain criminal and traffic
violations and a portion of fees from people attending traffic
violator schools. Existing law authorizes counties to levy an
additional penalty assessment until January 1, 2014 for
emergency medical services.
3)PREVIOUS LEGISLATION . AB 774 (Chan), Chapter 755, Statutes of
2006 requires hospitals to provide discounted services to
uninsured and underinsured consumers in a program
substantially similar to that required by this bill. Under AB
774, hospitals may charge eligible patients the higher rates
of Medicare, Medi-Cal, or another government program. AB 774
directs hospitals to give uninsured and underinsured
individuals a specified period of time to qualify for
insurance coverage or to negotiate a payment plan with the
hospital.
4)STATE OF INSURANCE IN CALIFORNIA . The UCLA Center for Health
Policy Research reports that job based health insurance
coverage continues to decline in this state. More than 6.5
million Californians under age 65 (more than one in five
nonelderly residents) went without health insurance at some
point in 2007. Employment based coverage of adults has
declined from 56.4% of employees to 54.3% in recent years.
UCLA reports that the erosion of job-based insurance is most
severe for low- and moderate-income adults who usually do not
qualify for any public insurance programs. The uninsured,
according to UCLA, have more health problems than do insured
individuals, but get less care.
5)SUPPORT . The Western Center on Law and Poverty supports the
bill because so many Californians, more than six million
individuals, depend on emergency rooms for their health care,
but pay very high charges because these uninsured individuals
have no insurer to negotiate on their behalf. The California
Immigrant Policy Center notes that medical debt is the leading
cause of personal bankruptcy in the United States, and that
this bill will help low income consumers avoid unmanageable
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levels of debt.
REGISTERED SUPPORT / OPPOSITION :
Support
California Immigrant Policy Center
Congress of California Seniors
Consumers Union
Health Access California
JERICHO: A Voice for Justice
Opposition
None on file.
Analysis Prepared by : John Miller/ HEALTH / (916) 319-2097