BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
AB 1310 (Bonta) - Medi-Cal: telehealth.
Amended: July 1, 2014 Policy Vote: Health 8-0
Urgency: No Mandate: No
Hearing Date: August 4, 2014
Consultant: Brendan McCarthy
This bill meets the criteria for referral to the Suspense File.
Bill Summary: AB 1310 would prohibit the Department of Health
Care Services from requiring a health care provider who is
licensed to practice in California to be located in California
to provide telehealth services to Medi-Cal beneficiaries.
Fiscal Impact:
One-time costs likely less than $50,000 to revise existing
regulations by the Department of Health Care Services
(General Fund and federal funds).
Unknown, though likely minor, increase in administrative
costs for investigations of out-of-state Medi-Cal providers
(General Fund and federal funds). If the Department performs
an investigation of an out-of-state Medi-Cal provider (for
example, because of concerns about improper billing), the
costs to conduct onsite inspections of records would be more
expensive than would be the case with an instate provider.
It does not seem likely that there will be a very large
number of out-of-state providers of telehealth services
under the bill. Therefore, the actual additional
investigation costs are not likely to be significant in any
given year.
Unknown increase in usage of Medi-Cal services due to the
availability of more providers (General Fund and federal
funds). By authorizing out-of-state providers to provide
services through telehealth, the bill increases the number
of potential Medi-Cal providers. For services like radiology
through telehealth, the bill is not likely to increase
overall demand for services, because radiology services will
almost always be provided when needed by a patient, whether
the provider is in state or out-of-state. On the other hand,
AB 1310 (Bonta)
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there are certain medical services for which Medi-Cal
beneficiaries can have difficult locating a provider. This
can be an issue of particular concern in rural areas. In
those cases, allowing additional providers may increase
overall utilization of services. It is important to note
that the low provider rates paid by Medi-Cal and the costs
to set up and maintain telehealth capabilities are likely to
limit utilization of telehealth by providers.
Background: Under state and federal law, the Department of
Health Care Services operates the Medi-Cal program, which
provides health care coverage to pregnant women, children and
their parents with low incomes, as well as blind, disabled, and
certain other populations. Pursuant to the federal Affordable
Care Act, California has opted to expand eligibility for
Medi-Cal up to 138 percent of the federal poverty level and to
include childless adults.
With the exception of certain populations (for example,
individuals eligible for limited scope Medi-Cal benefits or
individuals dually eligible for Medi-Cal and Medicare in most
counties), managed care is the primary system for providing
Medi-Cal benefits. The Department estimates that in 2014-15, 7.5
million Medi-Cal beneficiaries (73 percent of total enrollment)
will receive care through the managed care system.
Current law authorizes services to be provided to Medi-Cal
beneficiaries through telehealth and prohibits in-person contact
between a provider and a beneficiary if the service is
appropriately provided through telehealth. In general, the
Department pays for services provided through telehealth at the
same rate as would be paid for the service if it was not
provided through telehealth.
Current law generally limits the payment for services provided
to Medi-Cal patients outside of California to emergency care or
instances in which it would be dangerous for the patient to wait
until returning to California to receive care.
Proposed Law: AB 1310 would prohibit the Department of Health
Care Services from requiring a health care provider who is
licensed to practice in California to be located in California
to provide telehealth services to Medi-Cal beneficiaries.
AB 1310 (Bonta)
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Related Legislation: AB 1174 (Bocanegra) would authorize certain
allied dental professionals to perform additional activities
using telehealth. The bill would prohibit Medi-Cal from
requiring a face-to-face visit between a patient and provider
before allowing for teledentistry services. That bill will be
heard in this committee.
Staff Comments: According to the sponsors of this bill, Virtual
Radiologic, the Department of Health Care Services had
historically allowed out-of-state medical providers who are
licensed to practice in California to enroll in the Medi-Cal
program (necessary in order to bill the program for services).
However, recently, the Department has begun denying applications
for enrollment by out-of-state providers. The Department
indicates that it is relying on the statutory prohibition on
providing non-emergency care outside of California (since the
provider is actually providing in the service in another state)
even if the beneficiary is located in California.
The bill would only apply to medical provides who provide
services through fee-for-service Medi-Cal and bill the state for
services. In the Medi-Cal managed care system, providers are not
required to enroll with the Department as Medi-Cal providers in
order to provide services to a Medi-Cal managed care plan.