BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 690|
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THIRD READING
Bill No: SB 690
Author: Hernandez (D)
Amended: 1/10/12
Vote: 21
SENATE HEALTH COMMITTEE : 9-0, 5/4/11
AYES: Hernandez, Strickland, Alquist, Anderson, Blakeslee,
De Le�n, DeSaulnier, Rubio, Wolk
SENATE APPROPRIATIONS COMMITTEE : 6-2, 1/19/12
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Emmerson
NO VOTE RECORDED: Runner
SUBJECT : Health care coverage: discrimination
SOURCE : Author
DIGEST : This bill, beginning January 1, 2014, prohibits
health care service plans and health insurers from
discriminating against a provider who is acting within the
scope of that providers license or certification.
ANALYSIS :
Existing state law:
1. Provides for the regulation of health plans by the
Department of Managed Health Care (DMHC), and for the
regulation of health insurers by the Department of
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Insurance (CDI).
2. Requires health plans, except for specialized plans, and
disability insurers who negotiate and enter into
contracts with professional providers to provide
services at alternative rates of payment, as specified,
to give reasonable consideration to timely written
proposals for contracting by licensed or certified
professional providers.
3. Defines "reasonable consideration" as a consideration in
good faith of the terms of proposals for contracting
prior to the time that contracts for alternative rates
for payment are entered into or renewed.
4. Allows a plan or insurer to specify the terms and
conditions of contracting to assure cost efficiency,
qualification of providers, appropriate utilization of
services, accessibility, convenience to persons who
would receive the provider's services, and consistency
with its basic method of operation, but prohibits a plan
or insurer from excluding providers because of their
category of license.
5. Prohibits plans or insurers, as specified, from refusing
to give reasonable consideration to affiliation with
podiatrists for the provision of services solely on the
basis that they are podiatrists.
6. Specifies legislative intent that all persons licensed
in the state to practice dentistry be accorded equal
professional status and privileges, without regard to
the degree earned.
7. Prohibits nonprofit hospital service plans or
self-insured employee welfare benefit plans from
discriminating, as specified, with respect to
employment, against a licensed dentist solely on the
basis of the educational degree held by the dentist.
8. Prohibits a health plan which offers or provides
chiropractic services, as specified, from refusing to
give reasonable consideration to affiliation with
chiropractors for provision of services solely on the
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basis that they are chiropractors.
9. Specifies that health insurers are not required to
contract with or reimburse additional medical providers
if the geographic area is adequately served by those
with which it already contracts.
This bill, commencing January 1, 2014, conforms and will
be implemented pursuant to the provider nondiscrimination
provisions established in Section 2706 of the federal
Public Health Service Act (U.S.C. Sec. 300gg-5) and any
federal rules or regulations issued under that section.
This bill prohibits health care service plans and health
insurers from discriminating against a health care provider
who is acting within the scope of that provider's license
or certification with respect to participation or coverage
under a contract or policy.
This bill provides that these provisions would not be
construed to (1) require that a health plan or insurer
contract with any health care provider willing to abide by
the terms and conditions for participation established by
the plan or insurer, and (2) prevent a health plan or
insurer from establishing varying reimbursement rates based
on quality or performance measures.
Existing federal law, Section 1001 of the Patient
Protection and Affordable Care Act (PPACA) (Public Law
111-148), as amended by the federal Health Care and
Education Reconciliation Act of 2010 (Public Law 111-152),
established the requirements described above. This bill
mirrors federal law. Federal guidance on these provisions
is expected sometime in 2012; depending on the regulations,
the costs of this bill could increase or decrease, since
this bill is required to be implemented pursuant to PPACA
and any related rules or regulations.
In the event that this bill would increase access to health
care services, including to those paid for by the state by
Medi-Cal, the Healthy Families Program, and the California
Public Employees' Retirement System (CalPERS), there would
be unknown, potentially significant costs to the General
Fund, federal funds, special funds, and other funds
commencing January 1, 2014.
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This bill specifies that the bill's provisions will only be
implemented to the extent required by federal law.
Background
The Harkin Amendment
Section 2706 (a) of PPACA, referred to as the Harkin
Amendment - sponsored by Senator Tom Harkin (D-Iowa) of the
Senate Health, Education, Labor and Pensions Committee -
establishes the first-ever federal standard for provider
nondiscrimination. This provision in the federal health
reform law, which goes into effect in 2014, bars plans and
insurers from discriminating in plan coverage and
participation based on provider types. The United States
Department of Health and Human Services (HHS) is expected
to issue guidance on the implementation of this section of
PPACA in 2012.
This provision in federal law was supported by a wide range
of providers including audiologists, nurse practitioners,
nurse anesthetists, chiropractors, nurse-midwives,
occupational therapists, optometrists, physical therapists,
podiatrists, psychologists, speech-language-hearing
therapists, complementary and alternative medicine
providers, naturopathic physicians, acupuncturists, massage
therapists, and social workers.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
Major Provisions 2012-13 2013-14 2014-15 Fund
Developing regulations $85 Special
*
Help Center staffing Unknown costs, starting in
2014 Special *
and enforcement
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Increases in utilization Unknown costs, starting in
2014 Various **
for various health programs
* Managed Care Fund
** Medi-Cal costs shared 50 percent General Fund or 50
percent local funds, 50 percent federal funds; CalPERS
costs shared 55 percent General Fund, 45 percent
special and other funds; Healthy Families costs shared
35 percent General Fund, 65 percent federal funds
SUPPORT : (Verified 1/23/12)
American Nurses Association, California
California Association of Marriage and Family Therapists
California Association of Nurse Anesthetists Inc.
California Chiropractic Association
California Nurse-Midwives Association
California Optometric Association
California Physical Therapy Association
Coalition for Patients' Rights/California
Occupational Therapy Association of California
OPPOSITION : (Verified 1/23/12)
California Medical Association
ARGUMENTS IN SUPPORT : The Coalition for Patients'
Rights/ California, which includes the American Nurses
Association, California, the California Association of
Nurse Anesthetists Inc., the California Physical Therapy
Association, the Occupational Therapy Association of
California, and the California Optometric Association
states that many non-MD providers can reduce costs, improve
quality and increase access to care. The Coalition states
that traditional contracting arrangements exclude these
providers from being used to their fullest potential, and
such provider discrimination is anti-competitive. As
growing demands for health care services add stress to an
already overburdened system, efficient utilization of
health care professions other than traditional physicians
is essential to ensuring access and reigning in costs.
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The California Nurse-Midwives Association (CNMA) argues
that provider discrimination is wrong, and that it limits
or denies patient choice, and can have a negative impact on
access to and cost-effectiveness of care. CNMA further
points out that, as advanced practice nurses,
nurse-midwives work in collaboration with physicians to
provide quality health care for women throughout
California, it is vital to ensure that Californians have
access to the care and expertise that California's
nurse-midwives offer.
ARGUMENTS IN OPPOSITION : The California Medical
Association (CMA) opposes this bill, stating their strong
opposition to the federal health reform provision enacting
the health care provider nondiscrimination clause that this
bill codifies in state law. CMA points to existing state
law that requires plans and insurers to provide reasonable
consideration of allied providers when contracting for
services. CMA believes it would require insurers to expand
coverage for alternative therapies, which is inconsistent
with the President's goals to reduce health care costs for
medical treatments that are not proven effective. CMA
believes this bill could potentially open the door for
practitioners with less training and expertise, and force
unfettered access to unproven therapies, which could
increase costs, reduce quality and endanger patient safety.
DLW:mw 1/23/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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