BILL ANALYSIS
SB 442
Page 1
Date of Hearing: June 29, 2010
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
SB 442 (Ducheny) - As Amended: June 22, 2010
SENATE VOTE : 35-0
SUBJECT : Clinic corporation: licensing.
SUMMARY : Amends the administrative requirements for a clinic
corporation to apply for licensure for an affiliate primary care
clinic or a mobile health care unit operated as a primary care
clinic (collectively affiliate clinics). Specifically, this
bill :
1)Makes findings and declarations regarding the current system
for licensing affiliate clinics and the need to streamline
administrative processes through paperwork reduction and
elimination of duplication in the application process.
2)Clarifies that a clinic corporation can apply to establish
affiliate clinics on behalf of a primary care clinic, as
specified. Defines "clinic corporation" as a nonprofit
organization that operates one or more affiliate clinics.
Makes other definitions, as specified.
3)Adds to the conditions already in existing law under which the
Department of Public Health (DPH) is required to approve a
license for an affiliate clinic without first conducting an
initial onsite survey, that the clinic corporation and
affiliate clinic have the same medical director or directors
and medical policies, procedures, protocols, and standards.
4)Requires the affiliate clinic licensure application to consist
solely of a single-page form and supporting documents relating
to: the contact information of the clinic corporation and
affiliate clinic's administrative officers; the affiliate
clinic location and hours of operation; evidence of compliance
with minimum safety standards related to the affiliate
clinic's physical plant; and, other pertinent information, as
specified.
5)Permits the affiliate clinic application to be signed by an
officer of the clinic corporation's board of directors or the
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clinic corporation's chief executive officer or executive
director.
6)Requires the clinic corporation, in order to reduce paperwork,
eliminate errors, and streamline communications between DPH
and a clinic corporation that operates one or more affiliate
clinics, on behalf of all of the licensed clinics it operates,
to act as the administrative headquarters for purposes of
receiving from and submitting to DPH communications, as
specified.
7)Requires DPH to maintain a corporate file containing
information about each clinic corporation operating one or
more affiliate clinics, and for the file to include specified
information.
8)Prohibits a clinic corporation from being required to resubmit
information, materials, or documents, as specified, as part of
an affiliate clinic application.
9)Requires a clinic corporation to submit to DPH, on behalf of
all licensed affiliate clinics operated by the clinic
corporation, a single report of change that is applicable to
all affiliate clinics operated by the clinic corporation,
including a change in a principal officer or general manager
of the governing body, the medical director, and the clinic
administrator, as required by law.
10)Requires a clinic corporation to submit to DPH, on behalf of
all licensed affiliate clinics operated by the clinic
corporation, a single payment for all affiliate clinic
licensure.
11)Makes other technical and clarifying changes.
EXISTING LAW :
1)Defines a primary clinic as an outpatient health facility,
operated by a nonprofit corporation, which provides direct
medical, surgical, dental, optometric, or podiatric advice,
services, or treatment to patients who remain less than 24
hours. Requires that primary care clinics be licensed by DPH
and approved for operation by DPH prior to obtaining a
Medi-Cal provider number or providing services.
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2)Requires DPH to issue a provisional license, upon approval of
a primary clinic's initial licensure application, which is
good for six months from the date of issuance. DPH is then
required to conduct an on-site survey of the clinic within 30
days prior to the expiration of the provisional license and,
if the clinic meets all licensure requirements, issue a
regular license.
3)Permits a primary care clinic that has held a valid and
unsuspended license for at least the preceding five years,
with no history of repeated or uncorrected violations of law
or regulation that pose immediate jeopardy to a patient and
has no pending suspensions or revocation actions, to apply to
establish an affiliate primary care clinic (affiliate clinic)
at an additional site.
4)Requires DPH to issue a regular license to an affiliate clinic
within 30 days without the necessity of first conducting an
on-site survey, if:
a) The parent primary care clinic has submitted a completed
application for licensure for the affiliate clinic;
b) The parent and affiliate clinics' corporate officers are
the same and the clinics are owned and operated by the same
nonprofit organization;
c) The parent affiliate clinic's operational policies and
procedures and staff training are substantially the same;
and,
d) The parent clinic has submitted evidence to DPH
establishing compliance with the minimum construction
standards of adequacy and safety of the affiliate's
physical plant as prescribed by the Office of Statewide
Health Planning and Development (OSHPD).
5)Authorizes DPH to conduct a licensing inspection at any time
after receipt of the affiliate clinic licensing application;
6)Defines a mobile health care unit, commonly referred to as a
"mobile clinic," as a commercial coach that is licensed by DPH
as an independent freestanding clinic, or approved by DPH as
an adjunct of a licensed parent health facility or clinic, and
that provides medical, diagnostic, and treatment services in
order to ensure the availability of quality health care
services for patients in remote or underserved areas, and
patients who need specialized types of medical care.
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7)Authorizes DPH to issue a special permit to a clinic approved
to provide one or more specified special services, such as
birthing services, for which the state has established
separate standards.
8)Authorizes DPH to take various types of enforcement actions
against a primary care clinic that has violated state law or
regulation, including imposing fines, sanctions, civil or
criminal penalties, and suspension or revocation of the
clinic's license.
FISCAL EFFECT : This version of the bill has not yet been
analyzed by a fiscal committee.
COMMENTS :
1)PURPOSE OF THIS BILL . According to the author, primary care
clinics are at the core of the state's health care safety net
and primary care delivery systems. The author states that,
among the top concerns for clinics in their day-to-day
administration and long-term planning are difficulties
associated with state licensing and certification. The author
asserts that the current system for licensing and
certification of clinics is outdated and inefficient, which
causes providers and the state to waste scarce financial and
human resources.
The author states that most clinic organizations operate
multiple clinic sites, ranging in numbers from two to 25,
under the governance of a single board of directors and
medical directorship, using common business practices,
policies, and procedures, as well as medical oversight. The
author states that despite this, under current law, each
clinic site must be separately licensed, which requires
clinics to often submit the same information on separate
licensing applications, even when the information is identical
or unchanged. The author states that this process is not only
administratively burdensome and duplicative, it does not
account for the role of the governing clinic organization.
The author states that delays in the processing of licensing
applications often inhibit clinics from providing and/or
billing for much-needed services in their communities. The
author states that, to avoid the state licensing process, many
clinics are opting to open "intermittent clinics," which
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operate at or less than 20 hours per week, and do not require
state licensure.
2)AFFILIATE CLINIC LICENSURE . Under current law, primary care
clinics that wish to establish additional clinic sites,
referred to as "affiliate clinics" are granted an expedited
licensure process. Affiliate clinics are eligible for
licensure based upon their parent clinic's compliance history.
In order to apply to establish an affiliate clinic, a parent
clinic is required to have held a valid, unrevoked, and
unsuspended license for the preceding five years. In
addition, the parent clinic must have no demonstrable history
of repeated or uncorrected violations that pose immediate
jeopardy to patients, as well as no pending action to suspend
or revoke the parent clinic's license.
The parent clinic is required to submit a completed application
and an application fee, establish that the parent clinic and
the affiliate clinic have the same corporate officers and are
owned and operated by the same organization with the same
board of directors, and provide evidence of compliance with
minimum safety standards related to the affiliate clinic's
physical plant. If the parent clinic meets these
requirements, DPH is required to issue a license to the
affiliate clinic within 30 days. Affiliate clinics are not
required to be surveyed to qualify for licensure. However,
affiliate clinics must still pay license fees.
3)STREAMLINED AFFILIATE CLINIC APPLICATION . According to the
author and sponsors of this bill, the parent primary care
clinic, referred to in this bill as the clinic corporation, is
currently required in its application for affiliate clinic
licensure to submit approximately 210 pages of duplicative
information, with original signatures of each corporate
officer, board member, and clinic manager for every new clinic
application. The author and sponsor cite the following
documents as duplicative and propose in this bill to have
their required submission eliminated in order to streamline
the application process: clinic corporation's organizational
chart; copy of the non-profit corporation filing statement
from the California Secretary of State; Articles of
Incorporation; corporation bylaws; copy of the Internal
Revenue Service letter of determination acknowledging
tax-exempt nonprofit corporation status; list of all clinics
operated by the clinic corporation, including name, address,
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and contact information; administrative organization; and, an
applicant individual information form which must be completed
and signed by each board member, the corporation's
President/CEO, the officers of the corporation, and the clinic
manager which often results in a minimum of six pages per
individual.
The author and sponsor maintain that the supporting documents
that will remain required under the provisions of this bill
include, but are not limited to: certificate of occupancy from
local authority; grant deed, bill of sale, or sublease or
rental agreement of the clinic location; proof that the clinic
meets Title 24 building standard requirements; transfer
agreement between the affiliate clinic and a local hospital;
fire safety inspection request; and, services to be provided
at the clinic.
4)SUPPORT . According to Planned Parenthood Affiliates of
California (PPAC), one of the cosponsors of this bill, under
current law, each time a clinic corporation applies for a new
affiliate clinic license; numerous documents must be submitted
to DPH. PPAC maintains that this bill simply streamlines the
current overly-burdensome process and eliminates the duplicate
submissions of information currently required. PPAC argues
that this bill modernizes the current affiliate clinic
licensure process so that primary care clinics can more
efficiently open their doors and meet the growing needs of
individuals and families in their communities.
5)OPPOSITION . DPH writes in opposition to this bill that DPH is
willing to work to reduce the paperwork associated with
affiliate clinic licensure; however that DPH must maintain the
authority to collect all information necessary to ensure
public safety. DPH maintains that this bill proposes
significant system changes and, while not difficult, the
changes will impose a fiscal impact on the department.
6)PREVIOUS LEGISLATION .
a) AB 2010 (DeSaulnier), Chapter 90, Statutes of 2008,
exempts affiliate clinics from provisional licensure
requirements.
b) SB 1213 (Ducheny), Chapter 360, Statutes of 2008,
requires mobile clinics to notify DPH at least 24 hours
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prior to providing services at a new site, and waives any
notice requirement in the event the mobile clinic is
responding to federal, state, or local public health
emergencies.
c) SB 937 (Ducheny), Chapter 602, Statutes of 2003, revises
provisions relating to the licensure and operation of
clinics, and authorizes a primary care clinic that has been
licensed and in good standing for five years to file an
application to establish an affiliate clinic at an
additional site.
d) AB 2404 (Reyes), Chapter 111, Statutes of 2002,
prohibits the Department of Health Services (DHS), now DPH,
from requiring the licensure of each site where a mobile
clinic provides services, and instead requires a mobile
clinic to report to DHS at least 15 days prior to its first
visit to a new site, and to report to local authorities to
obtain necessary approvals.
e) AB 951 (Florez), Chapter 525, Statutes of 2001, requires
DHS to establish a centralized licensing application unit
to review applications, and train clinic surveyors in order
to process license applications in a more timely, uniform,
and cost-effective manner.
f) AB 2259 (Woodruff), Chapter 1020, Statutes of 1993,
provides for the licensure of mobile clinics to ensure the
availability of quality health care services for patients
in remote or underserved areas, and imposes various
licensure requirements and safety standards on mobile
clinics.
g) SB 1140 (Royce), Chapter 1456, Statutes of 1987,
requires provisional licensure for clinics, and other types
of health facilities.
7)AUTHOR AMENDMENTS . The author will be proposing clarifying,
technical amendments in an attempt to satisfy concerns raised
by DPH.
REGISTERED SUPPORT / OPPOSITION :
Support
California Family Health Council, Inc. (cosponsor)
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California Primary Care Association (cosponsor)
Planned Parenthood Affiliates of California (cosponsor)
Central Valley Health Network
Community Clinic Association of Los Angeles County
Family Health Centers of San Diego
Family HealthCare Network
Mountain Health & Community Services, Inc.
Planned Parenthood of San Diego & Riverside Counties
Planned Parenthood of Santa Barbara, Ventura and San Luis Obispo
Counties
Opposition
California Department of Public Health
Analysis Prepared by : Tanya Robinson-Taylor / HEALTH / (916)
319-2097