BILL ANALYSIS �
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UNFINISHED BUSINESS
Bill No: SB 1196
Author: Hernandez (D), et al.
Amended: 8/22/12
Vote: 21
SENATE HEALTH COMMITTEE : 9-0, 4/18/12
AYES: Hernandez, Harman, Alquist, Anderson, Blakeslee, De
Le�n, DeSaulnier, Rubio, Wolk
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SENATE FLOOR : 35-0, 5/3/12
AYES: Alquist, Berryhill, Blakeslee, Calderon, Corbett,
Correa, De Le�n, DeSaulnier, Dutton, Emmerson, Evans,
Fuller, Gaines, Hancock, Harman, Hernandez, Huff, Kehoe,
La Malfa, Leno, Lieu, Liu, Lowenthal, Negrete McLeod,
Pavley, Price, Rubio, Steinberg, Strickland, Vargas,
Walters, Wolk, Wright, Wyland, Yee
NO VOTE RECORDED: Anderson, Cannella, Padilla, Runner,
Simitian
ASSEMBLY FLOOR : 80-0, 8/27/12 - See last page for vote
SUBJECT : Claims data disclosure
SOURCE : Author
DIGEST : This bill prohibits a contract in existence or
issued, amended, or renewed on or after January 1, 2013,
between a health care service plan (health plan), or health
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insurer (collectively, carriers), and a provider or
supplier, from prohibiting, conditioning, or in any way
restricting the disclosure of claims data related to health
care services provided to an enrollee or subscriber of the
health plan or carrier, or beneficiaries of any self-funded
health coverage arrangement administered by the carrier to
a qualified entity, as defined.
Assembly Amendments made clarifying and technical changes.
ANALYSIS : Existing law makes Medicare data, under
federal law, available for the evaluation of the
performance of providers of services and suppliers, to
qualified entities, defined as a public or private entity
that is qualified as determined by the Secretary of the
federal Department of Health and Human Services (HHS), to
use claims data to evaluate the performance of providers of
services and suppliers on measures of quality, efficiency,
effectiveness, and resource use, and agrees to meet
specified requirements and other requirements as the HHS
Secretary may specify, such as ensuring security of data.
This bill:
1. Requires a qualified entity to comply with all
requirements established pursuant to federal law, as
specified, and any rules, regulations, and guidelines
adopted pursuant to the federal Patient Protection and
Affordable Care Act (ACA), to ensure the privacy and
security of the data.
2. Requires a qualified entity to also comply with rules,
regulations, and guidelines adopted pursuant to the ACA
governing provider and supplier requests for error
correction for data obtained under this bill.
3. Defines provider as a hospital, a skilled nursing
facility, a comprehensive outpatient rehabilitation
facility, a home health agency, a hospice, a clinic, or
a rehabilitation agency.
4. Defines supplier as a physician and surgeon or other
health care practitioner, or an entity that furnishes
health care services other than a provider.
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5. Establishes in the Civil Code a requirements on
qualified entities, as defined in federal law, that
receive claims data from a health care service plan or
health insurer to comply with the requirements governing
provider and supplier requests for error correction
established under Medicare regulations, as specified,
for all claims data received, including data from
sources other than Medicare.
6. Requires all disclosures of data made under this bill to
comply with all applicable state and federal laws for
the protection of the privacy and security of the data,
including, but not limited to, the federal Health
Insurance Portability and Accountability Act of 1996 and
the Health Information Technology for Economic and
Clinical Health Act, of the federal American Recovery
and Reinvestment Act of 2009, and implementing
regulations.
Background
Managing costs . According to a February 2008 California
HealthCare Foundation (CHCF) fact sheet, consumers are
paying more attention to the cost of their health care
because they have greater responsibility for paying for it.
People with insurance are coping with higher deductibles
and copayments and some are being offered consumer-driven
health savings accounts as an alternative to traditional
insurance. Those who lack health insurance have an even
more daunting task of anticipating and managing their
health care costs. Whether insured or uninsured, consumers
need to understand their financial liability and find the
best value. Additionally, employers have an increased
interest in price transparency in order to improve health
care outcomes for their employees and to slow the growth
rate of health care expenditures. Despite this, consumers
often do not have the tools to make informed decisions
based on cost and quality of care because some providers
have prevented price and quality information from being
disclosed.
Usefulness of data . A March 2006 report by The
Commonwealth Fund argues knowing prices of health care
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services is of little value without information on the
total cost of caring for a given condition and the quality
or outcomes of that care. Transparency and better public
information on cost and quality are essential for three
reasons: (1) To help providers improve by benchmarking
their performance against others; (2) to encourage private
insurers and public programs to reward quality and
efficiency; and (3) to help patients make informed
decisions about their care. Transparency can also play an
important role in leveling the playing field, as it can
shed light on the practice of charging patients different
prices for the same care. A March 31, 2012 Los Angeles
Times article entitled, "The bizarre calculus of emergency
room charges," highlighted a number of discrepancies in
charges for health care services that, at times, did not
seem to make sense. For example, a man with health
insurance was billed $13,000 for an MRI scan of his
shoulder that required him to pay $2,500 out of pocket
while his brother-in-law, who lacks health care coverage,
was billed $350 for the same procedure.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 8/28/12)
AFSCME, AFL-CIO
Blue Shield of California
California Department of Insurance
California Professional Firefighters
California Public Employees' Retirement System
California School Employees Association, AFL-CIO
Pacific Business Group on Health
San Diego Electrical Pension Trust
Small Business California
Small Business Majority
ARGUMENTS IN SUPPORT : According to the author, under the
ACA and final implementing regulations issued in December
2011, the vast Medicare claims database will be made
available for use in producing public reports on the
performance of health care providers. Any report issued by
a qualified entity using this data must include an
understandable description of the measures which shall
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include quality measures, risk adjustment methods,
physician attribution methods, data specifications and
limitations, and sponsors so that consumers, providers,
suppliers and others can assess the reports. The reports
must be available confidentially to any provider of
services or supplier to be identified in such report, prior
to the public release of such report, and provide an
opportunity to appeal and correct errors. The reports must
only include information on a provider of services or
supplier in an aggregate form as determined appropriate by
the HHS Secretary. According to the implementing
regulations, the Centers for Medicare and Medicaid Services
(CMS) believes the sharing of Medicare data with qualified
entities and the resulting reports will be an important
driver of improving quality and reducing costs in Medicare,
as well as for the health care system in general. CMS
believes this will increase the transparency of provider
and supplier performance while ensuring Medicare
beneficiary privacy.
Supporters all agree that increasing transparency and
giving consumers access to data on health care costs will
help in making more informed decisions. The Small Business
Majority (SBM) emphasizes that California's small
businesses are being hit hard with skyrocketing health care
costs that impact their ability to create jobs and grow the
economy. SBM continues that the ACA's health care reforms
will improve access for small businesses to affordable
health care and ensure their health care dollars are being
spent in the most efficient way. The Pacific Business
Group on Health supports this bill because claims data
contain standardized information on sizeable patient
populations with little effort from providers. These data
can provide information preventing unnecessary
hospitalizations and an average price an insured patient
would pay for knee replacement surgery.
ASSEMBLY FLOOR : 80-0, 8/27/12
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani,
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Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Gorell,
Grove, Hagman, Halderman, Hall, Harkey, Hayashi, Roger
Hern�ndez, Hill, Huber, Hueso, Huffman, Jeffries, Jones,
Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor,
Mendoza, Miller, Mitchell, Monning, Morrell, Nestande,
Nielsen, Norby, Olsen, Pan, Perea, V. Manuel P�rez,
Portantino, Silva, Skinner, Smyth, Solorio, Swanson,
Torres, Valadao, Wagner, Wieckowski, Williams, Yamada,
John A. P�rez
DLW:m 8/28/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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