BILL ANALYSIS
SB 196
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Date of Hearing: August 19, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
SB 196 (Corbett) - As Amended: July 9, 2009
Policy Committee: Health Vote:14-5
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill increases and extends notification requirements of
hospitals with emergency medical services that are reducing or
eliminating services. Specifically, this bill:
1)Extends notification requirements from 30 days to 60 days
prior to eliminating a supplemental service or closing a
hospital. Extends from 90 days to 120 days notification
requirements prior to a planned reduction or elimination of
hospital emergency medical services.
2)Requires all hospital employees to be notified of service
changes. Requires a health facility to hold a minimum of three
public meetings and requires a status update at the second
public meeting. Requires a facility to make reasonable efforts
to advertise the change, solicit media coverage, and inform
patients about changes.
FISCAL EFFECT
1)Absorbable workload to the California Department of Public
Health (DPH) to continue oversight of hospitals and current
law requirements regarding hospital closures.
2)Unknown, likely absorbable increased costs to hospitals to
complete requirements established by this bill. Public
hospitals, including the University of California, are less
likely to experience such cost increases. County and UC
hospitals are mission-driven, safety net providers of last
resort and are therefore less likely to close than non-profit
or for-profit counterparts.
SB 196
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COMMENTS
1)Rationale . This bill is sponsored by the author to address a
possible hospital closure in the author's district, San
Leandro Hospital in Alameda County. Sutter Health has
contracted with the Eden Township Health Care District to
operate San Leandro Hospital in recent years. Sutter is now
considering closing the hospital. According to the author,
this bill will increase the amount of information available to
patients and employees prior to closure.
Recent press accounts of the local situation indicate Sutter is
considering purchasing San Leandro Hospital. Sutter has
previously discussed closing the emergency room and turning
the facility into a rehabilitation hospital or selling the
facility to the Alameda County Medical Center as a replacement
for another facility.
2)Hospital Closures and Community Reaction . Since 1996, 90
hospitals have closed across California, with more than 25
closing in the past five years. Approximately 400 acute care
hospitals remain operational under current law. According to
some estimates, about half of all hospital closures are not
objected to by the public. Some communities, however, raise
concerns about the reduction or elimination of services,
capacity of the remaining hospitals, longer travel time to
other hospitals, and care from hospitals with less of an
investment in the patient community. In addition, hospital
closure can create significant pressure on local communities
to fund staffing transitions, pay for more costly care, and
provide infrastructure to increase access to health services
for certain patient populations.
3)Current Law Closure Notice . A hospital reducing or
eliminating emergency services is required under state law to
provide 90 days public notice. Before approving a downgrade
or closure of emergency services, DPH must receive a copy of a
local impact report. At least one public hearing must be held
and the report must address how the downgrade or closure will
affect the community and how the downgrade or closure will
affect emergency services provided by other entities. DPH
does not have the authority to prevent a facility from
closing.
4)Hospital Concerns . The California Hospital Association (CHA)
SB 196
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opposes this bill due to concerns about the predicaments
hospitals face when considering a reduction of service or
closure of a facility. According to the opposition, closures
are often the result of inadequate reimbursements from public
payers such as Medicare and Medi-Cal. When closures or
reductions are announced, staff begins looking for other work.
Requiring an extended period of notification prior to
reduction or closure may create significant staffing issues
for hospitals.
5)Related Legislation . AB 2400 (Price), Chapter 459, Statutes
of 2008 requires hospitals to provide public notice 30 days
prior to closing or eliminating a supplemental service.
Numerous other bills over the past decade have proposed changes
to hospital closure procedures. Some of these bills have not
been heard in policy committee while others have been vetoed
or held on the Suspense File of one of the Appropriations
committees. Those held on the Suspense File required more
workload and oversight than SB 196. For example, other bills
have required
Analysis Prepared by : Mary Ader / APPR. / (916) 319-2081