BILL ANALYSIS
AB 1544
Page 1
Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON HEALTH
Dave Jones, Chair
AB 1544 (Committee on Health) - As Introduced: March 4, 2009
SUBJECT : Health facilities: licensure.
SUMMARY : Permits a hospital in good standing to operate an
outpatient clinic without a prior onsite survey and requires the
Department of Public Health (DPH) to approve a specified license
within 30 days of receipt. Specifically, this bill :
1)Authorizes a hospital that meets specified criteria to
establish an outpatient clinic without the necessity of DPH
first conducting an initial onsite survey. In order to submit
an application a hospital must meet both of the following:
a) Hold a valid license for a minimum of five years without
repeated or uncorrected violations; have no pending actions
for suspension or revocation of Medicare or Medi-Cal
certification; and, meet all applicable federal and state
certifications; and,
b) Own and operate the outpatient service that is the
subject of the application.
2)Requires the outpatient service that is the subject of the
application to provide primary care to patients who remain in
the clinic less than 24 hours.
3)Specifies that outpatient services may not include chronic
dialysis treatment, outpatient surgeries, or alternative
birthing services.
4)Specifies the information to be included in the DPH
application.
5)Requires DPH to approve an application to add or modify an
outpatient service as a supplemental service, add it to the
hospital license, and issue a new license within 30 days, if
the hospital meets the specified requirements.
EXISTING LAW :
1)Requires the licensure of health facilities, including general
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acute care hospitals, acute psychiatric hospitals, and special
hospitals, and requires approval for specified supplemental
and outpatient services.
2)Prohibits a general acute care hospital from holding itself
out directly or indirectly by any sign, brochure, or
advertisement as providing any service or services which
require DPH approval as a supplemental service.
3)Requires any hospital licensee desiring approval for a
supplemental service to file with DPH an application on forms
provided by DPH.
4)Permits primary care clinics to operate an affiliate clinic
without DPH having first conducted an onsite survey, if
certain conditions are met.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee
COMMENTS :
1)PURPOSE OF THIS BILL . According to the Assembly Committee on
Health, authors of this bill, it is intended to expedite
expansion of hospital based outpatient clinics in order to
improve access to primary care and reduce the demand on
emergency departments. This bill speeds the approval process
for hospital based clinics by specifying a time frame for
application approvals and elimination of the requirement for a
DPH survey prior to initiating services in primary care
clinics. Hospitals routinely experience months long delays
waiting for DPH surveys. This bill, notes the Committee, will
speed the opening of new primary care clinics, reduce the
workload of DPH, and avoid unnecessary costs to hospitals.
2)BACKGROUND . Timely access to primary and preventive care is a
critical element in reducing health care costs and improving
health access. Yet, both insured and uninsured patients now
experience delays in accessing regular and timely primary
care. The health delivery system works best when appropriate
levels of care are accessible and transfers between primary,
emergency, and acute care can be facilitated. At this point
in time, additional outpatient clinic services need to be
expanded, yet the current system of approving new
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hospital-based outpatient clinics is often lengthy and slow,
making it more costly and difficult for hospitals to offer
additional primary care services.
Primary care clinics faced a similar problem in recent years.
Clinics also faced long delays in obtaining DPH approval of
new or ancillary operations, and in 2003 (SB 937 (Ducheny),
Chapter 602, Statutes of 2003) and again in 2008 (AB 2010,
(DeSaulnier) Chapter 90, Statutes of 2008) successfully passed
measures which streamlined the approval process by eliminating
the necessity of an onsite survey and requiring DPH
application approval within specified timeframes. This bill
is very similar to the primary care clinic statutes.
3)PREVIOUS LEGISLATION .
a) AB 2010 (DeSaulnier) exempts affiliate clinics from
provisional licensure.
b) SB 937 (Ducheny) permits a clinic to add a service or
remodel a site without having to seek a new license and
requires DPH to issue a license to a clinic within
specified timeframes.
c) AB 951 (Florez), Chapter 525, Statutes of 2001, requires
DPH to establish a centralized licensing application unit
to review applications, train clinic surveyors, and ensure
clinic applications are processed in a timely manner.
4) SUPPORT . The California Hospital Association supports this
bill and reports several examples demonstrating the
frustrations of hospitals whose clinic operations were delayed
by the wait for DPH approval. In the city of Reedley, the
Fresno Department of Public Health District Office required
seven months to complete their survey. The Reedley clinic
lost 2,800 patient visits waiting for the survey. In Modesto,
a new and expanded facility building has remained empty for
six months while the clinic waits for a surveyor. Similar
experiences are reported from Fairfield, Clearlake, and Lodi
hospitals.
REGISTERED SUPPORT / OPPOSITION :
Support
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California Association of Rural Health Clinics
California Hospital Association
Catholic Healthcare West
Desert Valley Hospital
Hospital Association of San Diego and Imperial Counties
Private Essential Access Community Hospitals
Sierra Kings District Hospital
Opposition
None on file.
Analysis Prepared by : John D. Miller / HEALTH / (916)
319-2097