BILL ANALYSIS �
AB 1822
Page 1
GOVERNOR'S VETO
AB 1822 (Bonta)
As Amended August 21, 2014
2/3 vote
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|ASSEMBLY: |73-0 |(May 8, 2014) |SENATE: |36-0 |(August 27, |
| | | | | |2014) |
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|ASSEMBLY: |78-0 |(August 28, | | | |
| | |2014) | | | |
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Original Committee Reference: HEALTH
SUMMARY : Allows certain healthcare providers to store unused
tissue without being licensed as a tissue bank, provided they
maintain the tissue in accordance with the manufacturers'
instructions and the tissue is regulated by the federal Food and
Drug Administration.
The Senate amendments specify that health care facilities
storing unused tissue must adhere to the manufactures'
instructions and be regulated by the Medical Board of
California.
EXISTING LAW : Requires the Department of Public Health (DPH) to
adopt rules and regulations, on or before July 1, 2004,
governing tissue banks engaged in the collection of human
musculoskeletal tissue, skin, and veins for transplantation in
humans, requires the regulations to be substantially based upon
criteria used by tissue bank trade associations, and requires
the regulations to include minimum standards for storing and
using tissue.
FISCAL EFFECT : According to the Senate Appropriations
Committee, anticipated annual reduction in licensing workload
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and fee revenues of about $260,000 per year to DPH (Licensing
and Certification Fund). DPH anticipates that about 270
facilities are currently licensed as tissue banks but would be
exempt under this bill. Staff notes that it is not likely that
DPH would reduce staff expenditures immediately under the bill,
therefore DPH is likely to support current staff with other
licensing fees for some period of time before staff are fully
redirected to other licensing activities or positions are
eliminated.
COMMENTS : According to the author, due to the burdens of
licensure, many hospitals and ambulatory surgical centers
located in California are simply opting not to obtain a tissue
bank license from the state. Rather, they make daily deliveries
of the specified tissue grafts at the beginning of the calendar
day, and then use a courier to return any unused tissue grafts
at the end of the day. The author further states that courier
fees have been known to cost one California licensed tissue
supplier over $150,000 in one year. The author notes these fees
are generally included in the overall cost of providing tissue
grafts in California, further increasing the cost of health
care.
Current law requires DPH to develop regulations regarding tissue
banks engaged in the collection of human tissue, skin, and veins
for transplantation into humans. However, according to DPH
these regulations were drafted but not successfully promulgated
because a subcommittee of the Clinical Laboratory Technology
Advisory Committee stated that it would take several years to
develop a regulatory package of this complexity because
technical and administrative changes were advancing at such a
rate that the regulations would be out-of-date before
promulgated. Instead it was recommended that DPH adopt into law
of the American Association of Tissue Bank (AATB) Standards and
the annual updates. AB 995 (Block), Chapter 497, Statutes of
2009, attempted to do this, but was later amended to deal with a
different subject matter. To date, regulations have yet to be
promulgated.
DPH has developed a "frequently asked question" or "FAQ"
document to provide guidance to entities as to whether or not
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they need to apply for a tissue bank license which states, "you
will need to apply for a tissue bank license if you perform any
or all of the four functions, namely collection, processing,
storage, or distribution of human tissue for purposes of
transplantation." The FAQ further states that a facility needs
a tissue bank license whenever the facility stores any material
without using it or returning it on the same calendar day.
The AATB is the sponsor of this bill and writes in support that
under current law, certain entities must apply for a state
license if the entity simply stores tissue for purposes of
transplantation into human beings. They note DPH guidance in
the FAQ has suggested that any storage without implantation or
return of the tissue on the same calendar day of receipt, would
require a tissue bank license. AATB further states that
allowing hospitals and ambulatory surgery centers to retain and
store unused tissue, provided they maintain the tissue in strict
accordance with the manufacturers' instructions, will reduce
unnecessary costs. Donate Life California supports this bill,
stating that they endorse efforts to ensure the safe and
efficient handling of all donated tissue, and that these donated
gifts of life improve and heal the lives of thousands each year.
DPH is opposed to this bill because as currently drafted, the
bill does not reference a specific patient, and would allow for
the acquisition of tissue for inventory purposes or extended
storage rather than for use on a specific patient or return to a
licensed tissue bank. DPH states that, as such, the bill does
not provide the necessary safeguards and oversight to ensure
that the storage conditions are properly maintained until the
tissue is transplanted.
GOVERNOR'S VETO MESSAGE :
The bill would exempt hospitals, ambulatory surgical
centers and other outpatient settings from having to
obtain licensure as a tissue bank if the human tissue
or cell-based product they receive and store meets
specified requirements.
Currently, because hospitals and other outpatient
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facilities do not want to become licensed tissue
banks, they pay expensive courier fees to transport
unused products back to tissue banks -- a cost they
pass on to the tissue banks themselves. While I
support eliminating overly burdensome regulation, I'm
not convinced that the bill strikes the right balance
between safety and economy.
I will direct the Department of Public Health to
continue working with interested parties to develop an
approach that balances appropriate oversight with cost
savings for suppliers.
Analysis Prepared by : Lara Flynn / HEALTH / (916) 319-2097
FN: 0005706