BILL ANALYSIS �
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: AB 1803
AUTHOR: Mitchell
AMENDED: April 23, 2012
HEARING DATE: June 6, 2012
CONSULTANT: Bain
SUBJECT : Medi-Cal: emergency medical conditions.
SUMMARY : Requires Medi-Cal benefits to include emergency
services and care that are necessary for the treatment of an
emergency medical condition, and medical care directly related
to the emergency medical condition, for fee-for-service (FFS)
Medi-Cal beneficiaries.
Existing law:
1.Existing law establishes the Medi-Cal program, which is
administered by the Department of Health Care Services (DHCS),
under which qualified low-income individuals receive health
care services.
2.Establishes a schedule of benefits under the Medi-Cal program,
which includes outpatient services, including physician
services, and inpatient hospital services subject to
utilization controls.
3.Defines, in Medi-Cal statute, a service as "medically
necessary" or a "medical necessity" when it is reasonable and
necessary to protect life, to prevent significant illness or
significant disability, or to alleviate severe pain. Defines,
through Medi-Cal regulation, "emergency services" to mean
those services required for alleviation of severe pain or the
immediate diagnosis and treatment of unforeseen medical
conditions, which, if not immediately diagnosed and treated,
would lead to disability or death.
4.Allows health plans to deny payment for emergency services and
care only if the health plan, or its contracting medical
providers:
a. Reasonably determines that the emergency
services and care were never performed; or
b. In cases when the plan enrollee did not
require emergency services and care and the enrollee
reasonably should have known that an emergency did not
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exist. This provision is referred to as the
"reasonable layperson" standard.
5.Requires any licensed health facility that maintains and
operates an emergency department (ED) to provide emergency
services and care to any person for any condition in which the
person is in danger of loss of life or serious injury or
illness when the health facility has the appropriate
facilities and qualified personnel available to provide the
services or care. Prohibits the provision of emergency
services and care from being based upon the person's
ethnicity, citizenship, age, preexisting medical condition,
insurance status, economic status, or ability to pay for
medical services.
This bill:
1.Requires Medi-Cal benefits to include emergency services and
care that are necessary for the treatment of an emergency
medical condition and medical care directly related to the
emergency medical condition, as defined in existing law, for
FFS Medi-Cal beneficiaries.
2.Defines, using a definition in existing law, "emergency
medical condition" to mean a medical condition manifesting
itself by acute symptoms of sufficient severity (including
severe pain) such that the absence of immediate medical
attention could reasonably be expected to result in any of the
following:
a. Placing the patient's health in serious
jeopardy,
b. Serious impairment to bodily functions, or
c. Serious dysfunction of any bodily organ or
part.
3.Prohibits this bill from being construed to change the
obligation of Medi-Cal managed care plans to provide emergency
services and care.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, as this bill reflects current practice, no fiscal
impact is expected.
PRIOR VOTES :
Assembly Health: 14- 4
Assembly Appropriations:12- 5
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Assembly Floor: 57- 14
COMMENTS :
1.Author's statement. According to the author, the "reasonable
layperson standard" is a critical patient safety protection first
established in California in 1994 to require health insurance
plans to base coverage of emergency care on a patient's symptoms,
not the final diagnosis. This law was passed after a series of
horror stories where patients received delayed care, and some
died, because of their inability to obtain prior approval from
their health plan to go to the ED. People in potentially
life-threatening situations should not be forced to diagnose their
own conditions out of fear their health plans will not pay.
California law does not have a reasonable layperson standard in
place for enrollees of Medi-Cal FFS. This discrepancy in the law
threatens patient safety and must be corrected.
2.Background. Medi-Cal contains different state law standards
for coverage of emergency services, depending upon whether the
beneficiary is enrolled in FFS Medi-Cal, a Medi-Cal county
organized health system (COHS) or a Medi-Cal managed care plan
that is Knox-Keene licensed. In Medi-Cal FFS and COHS plans
that are not Knox-Keene licensed, "medically necessary"
services must be provided when it is reasonable and necessary
to protect life, to prevent significant illness or significant
disability, or to alleviate severe pain. For enrollees of
Knox-Keene health plans, including Medi-Cal managed care plans
that are Knox-Keene licensed (a requirement in the two plan
model and in geographic managed care), health plans must
provide emergency services and care based on the broader
"reasonable person" standard. Specifically, health plans or
their contracting medical providers must reimburse for
emergency services and care provided to its enrollees until
the care results in stabilization of the enrollee, unless the
plan enrollee did not require emergency services and care and
the enrollee "reasonably should have known" that an emergency
did not exist.
In practice, DHCS indicates it does not deny coverage if a
medical condition does not turn out to be life-threatening but
adjusts physician reimbursement based on the level of care
provided. DHCS' Audits and Investigations Division does not
determine that ED evaluation and management services were not
appropriate based on the final diagnosis alone. DHCS
indicates, in accordance with Current Procedural Terminology
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guidelines, it considers the history, examination, and
complexity of medical decision-making in determining the
appropriate level of ED service, and it is the services
rendered that determine the level of compensation to the
physician and not the presenting symptoms or final diagnoses.
Federal Medicaid regulations require Medicaid managed care
organizations to cover and pay for emergency services based on
the prudent layperson standard, for services needed to
evaluate or stabilize an "emergency medical condition."
Federal regulations define an "emergency medical condition" as
a medical condition manifesting itself by acute symptoms of
sufficient severity (including severe pain) that a prudent
layperson, who possesses an average knowledge of health and
medicine, could reasonably expect the absence of immediate
medical attention to result in any of the following:
a. Placing the health of the individual (or, with
respect to a pregnant woman, the health of the woman or
her unborn child) in serious jeopardy,
b. Serious impairment to bodily functions, or
c. Serious dysfunction of any bodily organ or part.
3.Washington state Medicaid proposal. One of the reasons this
bill was introduced was a result of actions taken in
Washington state regarding Medicaid reimbursement for
emergency services. In December 2011, Washington state's
Health Care Authority (Authority) announced its intention to
stop paying for ED visits by Medicaid beneficiaries "when
those visits are not necessary for that place of service." The
state proposed that a screening payment be made, but only by
managed care plans for managed care beneficiaries, and no
payment for beneficiaries in the fee-for-service program.
To identify unnecessary ED visits, the state proposed a list of
approximately 500 diagnosis codes from the Washington state
Health Authority's List of "Nonemergency" Conditions. The
proposed rule would have applied to all Medicaid
beneficiaries, irrespective of age, disability, or place of
residence (such as a nursing home) and even if the patient,
the child's parent, or the nursing home staff believed that ED
care was needed. The Authority had previously sought to impose
an annual three-visit limit on nonemergency ED use but was
blocked by a state court ruling.
On April 1, 2012, the day the new policy was supposed to take
effect, Washington Governor Chris Gregoire suspended
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implementation in order to try an alternative work-out with
the state's hospitals and emergency physicians. The compromise
plan calls for the rapid development and statewide adoption of
"best practices" to "reduce medical assistance expenditures
through the reduction of unnecessary emergency department
visits." By July 1, hospitals accounting for at least 75
percent of ED utilization by Medicaid FFS clients must submit
legal attestations that they are complying with the plan. If
they fail to do so, the Authority may proceed with
implementing its policy of nonpayment for ED visits it
determines to be nonemergency visits.
4.ED visits. In 2010, 9.7 million hospital-based ED visits were
reported to the Office of Statewide Health Planning and
Development. Of these visits, 28 percent were reimbursed by
Medi-Cal (both Medi-Cal FFS and managed care). In 2010, an
additional 795,782 nonemergency visits were also reported
(visits are defined as patient visits to an ED that cannot be
classified under the codes associated with an emergency
medical service visit.
A recently released California HealthCare Foundation-funded
telephone survey of 1,083 Medi-Cal beneficiaries found that 2
percent of those survey indicated the ED was their usual
source of routine care, and 1 percent indicated it was their
preferred source of care. The survey found that adults with
Medi-Cal coverage were more likely to visit the ED compared to
people with other coverage. Fifty-five percent of Medi-Cal
beneficiaries who report fair or poor health visited the ED in
the last 12 months as compared to 25 percent of individuals
with other coverage. Thirty-four percent of Medi-Cal
beneficiaries who report fair or excellent health visited the
ED in the last 12 months as compared to 14 percent of
individuals with other coverage.
5.Medi-Cal copayments. Through AB 97 (Committee on Budget),
Chapter 3, Statutes of 2011, in order to achieve budget
savings and avoid Medi-Cal drastically cutting enrollment
standards or benefits or imposing further reductions on
Medi-Cal providers, the Legislature increased Medi-Cal
copayments for nonemergency services received in an ED from $5
to copayments of up to $50, required the copayment of all
beneficiaries (existing law contains exemptions for emergency
services and for children, hospital inpatients, and
individuals age 65 and older, among other groups), allowed
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providers to deny service to individuals who did not pay the
copayment, subject to federal law and approval. Nonemergency
services were defined as services not required for the
alleviation of severe pain or the immediate diagnosis and
treatment of unforeseen medical conditions that, if not
immediately diagnosed and treated, would lead to disability or
death.
In addition, AB 97 established copayments of up to $50 for
emergency services received in an ED. AB 97 required
beneficiaries to make these copayments and reduced the
provider's Medi-Cal reimbursement by the copayment amount.
However, in February 2012, these copayment proposals were not
approved by the federal Centers for Medicare and Medicaid
Services.
As part of the Governor's 2012-13 May Budget Revision, the
Administration is proposing a copayment of $15 for
nonemergency use of the emergency room, effective January 1,
2013. The proposal assumes managed care savings of $14.3
million ($7.1 million GF) in 2012-13.
6.Support. This bill is sponsored by the California Chapter of
the American College of Emergency Physicians (Cal-ACEP), which
represents emergency physicians, to apply the reasonable
layperson standard to Medi-Cal so that all Medi-Cal patients
are covered when they seek treatment for an emergency.
Cal-ACEP states that California and federal law governing
Medi-Cal and Medicaid contain different provisions related to
the reasonable (or under federal law, "prudent person"
standard) layperson standard and the provision of emergency
medical services. However, there is a gap in FFS Medi-Cal
where no reasonable layperson standard exists. Cal-ACEP states
this bill is needed to close the gap in law. While the
reasonable layperson standard has been a long-established
patient protection in California, efforts to erode this
protection are surfacing in other states. Given that threat,
Cal-ACEP concludes it is time to close the loophole in
California law to protect all Medi-Cal patients.
7.Amendment. This bill defines "emergency medical condition" by
reference to an existing definition in Health and Safety Code
Section 1317.1. This bill also uses the phrase "emergency
services and care" which is also used in Section 1317.1 but
which is not defined in this bill. Medi-Cal regulations
currently contain a definition of "emergency services." The
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author is proposing an amendment to clarify that "emergency
services and care" is defined using the existing definition in
Health and Safety Code Section 1317.1.
SUPPORT AND OPPOSITION :
Support: California Chapter of the American College of
Emergency Physicians (sponsor)
California Black Health Network
Oppose: None received.
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