BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 964|
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THIRD READING
Bill No: SB 964
Author: Hernandez (D)
Amended: 4/9/14
Vote: 21
SENATE HEALTH COMMITTEE : 5-1, 4/30/14
AYES: Hernandez, De Le�n, DeSaulnier, Evans, Monning
NOES: Morrell
NO VOTE RECORDED: Beall, Nielsen, Wolk
SENATE APPROPRIATIONS COMMITTEE : 5-2, 5/23/14
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NOES: Walters, Gaines
SUBJECT : Health care service plans: timeliness standards:
medical surveys
SOURCE : Health Access California
DIGEST : This bill requires health plans to use standardized
survey methodology, if developed by the Department of Managed
Health Care (DMHC), for timely access reporting. Repeals an
exemption from DMHC medical surveys for Medi-Cal managed care
plans, as specified. Requires County Organized Health Systems
(COHS) to be treated as a health plan under specified timely
access requirements. Requires DMHC medical surveys to be
conducted by distinct product lines for Medi-Cal managed care
and Covered California products, and requires for those product
lines annual reviews for compliance with network adequacy,
timely access, continuity of care, and quality management.
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Exempts from the distinct review by product line requirement
plans that use the same network for Medi-Cal or Covered
California products. Requires annual DMHC medical surveys for
the first five years after initial enrollment for Medi-Cal
managed care plans that enroll beneficiaries as a result of the
transition of the Healthy Families Program, seniors and persons
with disabilities (SPDs), rural expansion, and the Coordinated
Care Initiative (CCI).
ANALYSIS :
Existing law:
1. Establishes DMHC to regulate health plans under the
Knox-Keene Health Care Service Plan Act of 1975 (Knox-Keene
Act), the Department of Insurance (CDI) to regulate health
insurers under the Insurance Code and Department of Health
Care Services (DHCS) to administer the Medi-Cal program,
which provides health care to children, SPDs, people also
eligible for Medicare, and low-income individuals and
families.
2. Requires DMHC to develop and adopt regulations to ensure
that health plan enrollees have access to health care
services in a timely manner, and requires DMHC to develop
indicators of timeliness, as specified.
3. Requires contracts between health plans and health care
providers to assure compliance with the timely access
standards developed by DMHC. Requires the contracts to
require reporting by health care providers to health plans
and by health plans to DMHC to ensure compliance with the
standards.
4. Requires health plans to report annually to DMHC on
compliance with the timely access standards
5. Requires DMHC medical surveys to be conducted as often as
necessary, but not less frequently than once every three
years.
6. Requires, to avoid duplication, the Director of DMHC to
employ, but not be bound by, the findings of DHCS medical
surveys, for health plans contracting with DHCS, as
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specified.
7. Requires, no later than 18 months following release of a
final medical survey report, DMHC to conduct a follow-up
review to determine and report on the status of the plan's
efforts to correct any deficiencies.
8. Requires DHCS to conduct annual medical audits of each
Medi-Cal managed care plan unless the Director of DHCS
determines there is good cause for additional reviews.
Requires the reviews to use the standards and criteria
established pursuant to the Knox-Keene Act, or Insurance
Code, as appropriate.
9. Requires DHCS to be authorized to contract with professional
organizations or DMHC or CDI, as appropriate, to perform the
periodic review required by law. Requires DHCS, or its
designee, to make a finding of fact with respect to the
ability of the Medi-Cal managed care plan to provide quality
health care services, effectiveness of peer review, and
utilization control mechanisms, and the overall performance
of the Medi-Cal manage care plan in providing health care
benefits to its enrollees.
10.Requires the Commissioner of CDI, on or before January 1,
2004, to promulgate regulations applicable to health insurers
to ensure that insureds have the opportunity to access needed
health care services in a timely manner. Requires these
regulations to be designed to assure accessibility of
provider services in a timely manner to individuals
comprising the insured or contracted group pursuant to the
benefits covered.
This bill:
1. Requires health plans to use standardized survey methodology
if developed by DMHC for timely access reporting.
2. Requires DMHC to annually review information regarding
compliance with the timely access standards, including any
waivers or alternative standards granted to a plan. Requires
by December 1, 2016, and annually thereafter, DMHC to post
its findings from that review on its Internet Web site.
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3. Repeals a provision in the Knox-Keene Act that exempts a
health plan that provides services only to Medi-Cal
beneficiaries from medical survey requirements upon
submission to the Director of DMHC of the medical survey
audit for the same period conducted by DHCS as part of the
Medi-Cal contracting process, unless the Director determines
that an additional medical survey audit is required.
4. Requires a health plan that provides services to Medi-Cal
managed care beneficiaries to receive DMHC medical surveys by
its Medi-Cal managed care product line distinct from its
other product lines, if any, in order to determine whether
services received by Medi-Cal beneficiaries comply with the
Knox-Keene Act.
5. Requires these health plans to be annually reviewed with
respect to Medi-Cal managed care product lines for compliance
with:
A. Accessibility and availability of services, including
network adequacy and timely access to care;
B. Continuity of Care; and
C. Quality management, including precautions to ensure
that appropriate care is not withheld or delayed for any
reason.
6. Requires a health plan that provides services to enrollees
in Covered California to receive DMHC medical surveys by its
product line sold through Covered California distinct from is
product line sold outside Covered California, if any, in
order to determine whether the services received by Covered
California enrollees comply with the Knox-Keene Act.
7. Requires these health plans to be annually reviewed with
respect to product line sold through Covered California for
compliance with:
A. Accessibility and availability of services, including
network adequacy and timely access to care;
B. Continuity of Care; and
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C. Quality management, including precautions to ensure
that appropriate care is not withheld or delayed for any
reason.
8. Exempts from the DMHC medical survey distinct product
requirement a health plan that uses the same network for its
product line sold through Covered California as the network
used for its product line sold outside Covered California and
a health plan that uses the same network for its product line
sold through Covered California as the network used for its
Medi-Cal managed care product line.
9. Requires annual DMHC medical surveys with respect to the
populations enrolled for the first five years after initial
enrollment for a plan that enrolls Medi-Cal beneficiaries as
a result of:
A. The transition of Healthy Families Program;
B. Managed care expansion of SPDs;
C. Managed care expansion in rural counties; and
D. CCI.
10.Authorizes DMHC to coordinate the surveys and reviews with
DHCS in order to allow for simultaneous oversight of Medi-Cal
managed care plans by both departments, provided that this
coordination does not result in a delay of the surveys or
reviews required or in the failure of DMHC to conduct those
surveys or reviews.
11.Requires COHS to be treated as health care service plans
under the timely access requirements to report by health care
providers and health plans and report annually to DMHC on
compliance.
Background
According to the author's office, this bill has been introduced
to ensure that the DMHC medical surveys take into consideration
requirements unique to Medi-Cal managed care and Covered
California and that sufficient attention and resources are given
to health plan network adequacy and timely access enforcement.
Media reports have raised concerns about lack of access to
health care providers and "narrow" provider networks in Medi-Cal
and Covered California. Covered California has also reported
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questions about accuracy of provider directories, timely access
calls in certain areas or "hot spots," and confusion about
mismatch of physicians and hospitals, physician confusion about
network status and confusion about benefit design. California
has strong network adequacy and timely access to services
requirements for health plans and insurers but monitoring and
enforcement of these laws is developing at the same time
millions of new individuals are enrolling in Medi-Cal managed
care and Covered California plans. Covered California has
recommended coordinating directly with regulators on network
adequacy, requiring the use of the regulator template, common
analytics and coordinated product and network filing reviews
with cross plan comparisons. DMHC also indicates that over the
last 18 months significant complaint increases with regard to
access related to Covered California and Medi-Cal include
enrollees having difficulty finding a provider that is
contracted with their plan. This bill is intended to clarify
distinctions in enforcement responsibility and ensure tools are
in place so that DMHC can monitor and enforce adequate network
and timely access requirements. Having an insurance card only
ensures better health outcomes if patients actually have access
to the right care at the right place at the right time.
DMHC and CDI Timely Access . The DMHC's Timely Access to
Non-Emergency Health Care Services Regulation (Timely Access
Regulation) became effective January 17, 2010. The purpose of
the Timely Access Regulation is to fully implement AB 2179
(Cohn, Chapter 797, Statutes of 2002) which directed DMHC and
CDI to adopt regulations to ensure enrollees access to necessary
health care services in a timely manner. The health plans
licensed by DMHC had until January 17, 2011 to fully implement
the policies, procedures and systems necessary to comply with
the regulations. In October 2010, health plans were required to
submit a filing to demonstrate how the standards and regulations
would be met. Each health plan must show that its provider
network is large and varied enough to offer enrollees
appointments that meet the specified standards.
Covered California . At Covered California's April 17, 2014
board meeting, staff reviewed its contractual expectations for
quality and access and shared with the board and public concerns
being raised about the accuracy of certain plan provider
directories, timely access to available providers, including
specialists and call hot spots in rural counties and in Alameda
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County. Confusion about benefit design with regard to
in-network vs. out-of-network benefits was described as well as
mismatch of physicians and hospitals. Covered California staff
explained that they are troubleshooting with plan partners and
referring enrollees to DMHC and independent legal assistance
through the Health Consumer Alliance. Covered California
indicates they have been proactive with plans and provider
organizations in trying to communicate changes and add
physicians to networks. Covered California is working to
optimize timely access and is considering methods such as
sponsoring a third party "secret shopper" survey.
COHS . In California, the oldest model of Medi-Cal managed care
are COHS, which serves approximately 1.3 million beneficiaries
through six health plans in 14 counties: Marin, Mendocino,
Merced, Monterey, Napa, Orange, San Mateo, San Luis Obispo,
Santa Barbara, Santa Cruz, Solano, Sonoma, Ventura, and Yolo.
In the COHS model, DHCS contracts with a health plan established
by the county's Board of Supervisors and all Medi-Cal enrollees
are in the same health plan. Unlike other Medi-Cal managed care
plans, COHS are exempt from licensure under the Knox-Keene Act
and are therefore not regulated by DMHC, but are required to
meet most of the Knox-Keene requirements by contract with DHCS.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
� Annual costs of about $4.5 million per year to develop
regulations, respond to complaints, and enforce requirements
of this bill by the DMHC (Managed Care Fund).
� No significant impacts to the Medi-Cal program are
anticipated. DMHC does not expect that the additional survey
and reporting requirements in this bill will significantly
increase costs to Medi-Cal managed care plans.
SUPPORT : (Verified 5/23/14)
Health Access California (source)
AARP
AFSCME, AFL-CIO
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California Association for Health Services at Home
California Chapter of the American College of Emergency
Physicians
California Coverage and Health Initiatives
California Medical Association
California Pan-Ethnic Health Network
California Primary Care Association
Children Now
Children's Defense Fund - California
March of Dimes California Chapter
National Health Law Program
National Multiple Sclerosis Society - California Action Network
PICO California
Private Essential Access Community Hospitals
SEIU - California State Council
The Children's Partnership
United Ways of California
Western Center on Law and Poverty
OPPOSITION : (Verified 5/23/14)
California Association of Health Plans
ARGUMENTS IN SUPPORT : This bill's sponsor, Health Access
California (Health Access), indicates for more than 20 years,
Directors of DHCS have assured lawmakers, advocates, and other
stakeholders that those Californians covered through Medi-Cal
managed care would have the same protections as every other
Californian in a managed care plan. Yet during all these
decades, Health Access states they have listened to complaint
after complaint from consumers and physicians about lack of
timely access to adequate networks for those in Medi-Cal. Today
over 70% of Californians on Medi-Cal are in managed care and
that proportion is still rising as numerous managed care
transitions continue. About half the consumers that DMHC is
responsible for protecting are in Medi-Cal managed care-yet
there is no focused scrutiny on Medi-Cal managed care plans.
Covered California has been an active purchaser, driving hard
bargains with its contracting plans. Health Access does not
oppose narrow networks but does oppose inadequate networks that
do not assure timely access to medically necessary care. The
National Health Law Program among other provisions supports that
this bill will hold Medi-Cal County Organized Health Systems to
the same standards as other plans. The March of Dimes indicates
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that Medi-Cal pays for nearly 50% of births and 1.4 million
individuals have enrolled in an exchange plan so any quality
improvements for both of these types of plans can lead to
healthier pregnancies and healthier babies for a large
population. The California Pan-Ethnic Health Network indicates
narrow networks must be adequate networks that provide timely
access to care so that Californians with coverage through
Covered California get the care they need when they need it.
Western Center on Law and Poverty (WCLP) believes it is critical
with these increases in Medi-Cal managed care that there is
proper scrutiny paid to timely access to care, network adequacy,
continuity of care and quality of care. WCLP also writes that
joint oversight and responsibility of DMHC and DHCS should be
formalized as does this bill. WCLP indicates that a survey of a
plan's commercial product is not sufficient to give information
about the adequacy of the plan in serving their Medi-Cal or
Covered California enrollees. The California Chapter of the
American College of Emergency Physicians believes Medi-Cal
enrollees are over represented in emergency departments because
they cannot get in to see a doctor.
ARGUMENTS IN OPPOSITION : The California Association of Health
Plans (CAHP) writes that health plans are held strictly
accountable for enrollee access through regulation, statute, and
contracts with state entities like Covered California and
Medi-Cal. Currently, in order to obtain a license in
California, a health plan must undergo an exhaustive application
process through DMHC, which can take upwards of a year and
entails hundreds of application exhibits demonstrating every
aspect of proposed operations. Plans must file their entire
provider network, GeoAccess standards and maps (plotting the
location of all providers and all members in each plan region),
and methodologies for ensuring timely access to care. If a
health plan desires to expand into a new line of business, the
health plan must file all new exhibits demonstrating network
adequacy. Once licensed, health plans must file several weekly,
monthly, quarterly or annual reports and a combination of
network, timely access, and geographic access related reports as
a routine part of health plan operations. Additional ad hoc
reports are routinely requested by DMHC, DHCS, or Covered
California. All health plans already undergo a routine medical
survey within the first year of licensure and every three to
five years thereafter. It is important to note that health
plans pay an annual assessment to the DMHC to support many of
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these regulatory functions including a hotline that helps
enrollees if they experience any difficulties accessing care.
CAHP believes this bill will lead to more cost and
administrative burdens.
JL:k 5/23/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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