BILL ANALYSIS �
SB 1274
Page 1
SENATE THIRD READING
SB 1274 (Wolk)
As Amended April 26, 2012
Majority vote
SENATE VOTE :36-0
BUSINESS & PROFESSIONS 9-0 HEALTH
14-0
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|Ayes:|Hayashi, Bill Berryhill, |Ayes:|Monning, Logue, Atkins, |
| |Allen, Butler, Eng, | |Bonilla, Eng, Garrick, |
| |Hagman, Hill, Ma, Smyth | |Gordon, Hayashi, |
| | | |Roger Hern�ndez, Mansoor, |
| | | |Mitchell, Nestande, Pan, |
| | | |Williams |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Provides an exemption from the prohibition against the
Corporate Practice of Medicine (CPM) to allow a hospital that is
owned and operated by a charitable organization and offers only
pediatric subspecialty care to charge for physician services.
Specifically, this bill :
1)Allows a hospital that meets all of the following conditions
to charge for professional services rendered to patients
beginning January 1, 2013:
a) Is owned and operated by a licensed charitable
organization;
b) Offers only pediatric subspecialty care;
c) Employed licensees on a salary basis before January 1,
2012; and,
d) Has not charged for professional services rendered to
patients.
2)Allows the provision described above, provided the following
conditions are met:
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a) The hospital does not increase the number of salaried
licensees by more than five licensees each year;
b) The hospital does not expand its scope of services
beyond pediatric subspecialty care;
c) The hospital accepts each patient needing its scope of
services regardless of his or her ability to pay, including
whether the patient has any form of health care coverage;
d) The medical staff concur by an affirmative vote that the
licensee's employment is in the best interest of the
communities served by the hospital; and,
e) The hospital does not interfere with, control, or
otherwise direct a physician and surgeon's professional
judgment in a manner prohibited by existing law, as
specified.
EXISTING LAW :
1)Prohibits corporations and other artificial legal entities
from having any professional rights, privileges, or powers to
practice medicine (known as the prohibition against CPM).
However, the Division of Licensing of the Medical Board of
California (MBC) may grant approval for the employment of
physicians on a salary basis by licensed charitable
institutions, foundations, or clinics if no charge is made for
professional services rendered.
2)Exempts the following clinics from the prohibition
against CPM:
a) Clinics operated primarily for the purpose of
medical education by a public or private nonprofit
university medical school approved by the MBC or the
Osteopathic Medical Board, which may charge for
professional services rendered to teaching patients by
licensed physicians and surgeons who hold academic
appointments on the faculty of the university if the
charges are approved by the physician and surgeon in
whose name the charges are made;
b) Certain nonprofit clinics organized and operated
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exclusively for scientific and charitable purposes
that have been conducting research since before 1982
and that meet other specified requirements to employ
physicians and surgeons and charge for professional
services. These clinics must not interfere with,
control, or otherwise direct a physician and surgeon's
professional judgment in a manner prohibited by the
CPM prohibition or any other provision of law; and,
c) A narcotic treatment program regulated by the
Department of Alcohol and Drug Programs, which may
employ physicians and surgeons and charge for
professional services rendered. These programs must
not interfere with, control, or otherwise direct a
physician and surgeon's professional judgment in a
manner prohibited by the CPM prohibition or any other
provision of law.
3)Exempts medical or podiatry professional corporations
organized and practicing pursuant to the Moscone-Knox
Professional Corporations Act from the CPM prohibition if a
majority of the owners or shareholders are licensed physicians
or podiatrists, respectively.
FISCAL EFFECT : Unknown. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS : According to the author, "The Shriners Endowment Fund
has fully supported the operations of the Shriners hospitals
since its inception in 1923. The Endowment Fund incurred a very
significant decrease in value as a result of the economic
downturn in FY �fiscal year] 2008-09. Shriners has continued to
serve children and their families through deficit spending,
which is an unsustainable financial model. SB 1274 would allow
Shriners to recoup some of its costs by billing insurers for
physician services, so the hospital can continue to focus on its
mission to serve as many children with specialized medical needs
as possible. The bill also specifies the hospital must continue
to accept each patient in need of care within its scope of
services regardless of his or her ability to pay."
Analysis Prepared by : Angela Mapp / B.,P. & C.P. / (916)
319-3301
SB 1274
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FN: 0004708