BILL ANALYSIS �
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: SB 986
AUTHOR: Hernandez
AMENDED: April 10, 2014
HEARING DATE: April 30, 2014
CONSULTANT: Bain
SUBJECT : Medi-Cal: managed care: exemption from plan
enrollment.
SUMMARY : Requires, for a Medi-Cal beneficiary who has received a
medical exemption request (MER) from mandatory enrollment in a
Medi-Cal managed care plan and who is to receive or has received
a specified transplantation, an extension of the MER for up to
12 months if the treating physician determines that it is
medically necessary. Requires additional MER extensions to be
granted, subject to specified criteria, including if the
patient's condition is not stable enough to transfer. Prohibits
the existence of a contract between a health care provider,
provider's medical group or hospital and a Medi-Cal managed care
plan from being considered as a factor in determining the
extension of a MER.
Existing law:
1.Establishes the Medi-Cal program, administered by the
Department of Health Care Services (DHCS), under which
qualified low-income individuals receive health care services.
The Medi-Cal program is, in part, governed and funded by
federal Medicaid Program provisions. One of the methods by
which Medi-Cal services are provided is through contracts with
various types of managed care health plans.
2.Authorizes DHCS to require certain populations, including
seniors and persons with disabilities who do not have other
health coverage, to be assigned as mandatory enrollees into
new or existing Medi-Cal managed care health plans. Requires
enrollment in a Medi-Cal managed health care plan to be
mandatory in order to receive services under Medi-Cal in
specified rural counties, except as otherwise provided by law.
3.Requires each Medi-Cal beneficiary or eligible applicant to be
informed that he or she may choose to continue an established
patient-provider relationship if his or her treating provider
is a primary care provider or clinic contracting with the
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managed health care plan, has the available capacity, and
agrees to continue to treat that beneficiary or eligible
applicant.
This bill:
1.Requires a Medi-Cal beneficiary who has received a MER
exempting the beneficiary from mandatory enrollment in a
Medi-Cal managed care plan to receive an extension of the MER
beyond the initial 12-month exemption period if both of the
following conditions are met:
a. The beneficiary is to receive or has received
an allogeneic bone marrow transplantation, allogeneic
blood stem cell transplantation, cord blood
transplantation, or haploidentical transplantation;
and,
b. If the treating physician who provided or
oversaw the transplantation or who is providing the
follow-up care to the beneficiary determines that it
is medically necessary for the beneficiary to remain
under the care of the treating physician.
2.Requires the MER to be provided for up to 12 months, after
which the treating physician who provided or oversaw the
transplant, or who is providing the follow-up care, is
required to assess the beneficiary's condition to determine
whether the beneficiary's medical condition has stabilized to
a level that would enable the beneficiary to be safely
transferred to a physician within a Medi-Cal managed care
health plan without any deleterious effects to the
beneficiary's health.
3.Requires the MER to be extended for up to an additional 12
months if, at the end of the first extension, the treating
physician determines that the beneficiary's condition is not
sufficiently stable to enable a transfer without deleterious
effects to the beneficiary. Requires additional extension
requests to be handled pursuant to the process above.
4.Prohibits a beneficiary who requests an extension of a MER
from being transitioned into a Medi-Cal managed care plan
until all appeals, fair hearings processes, litigation, and
other means of redress have been exhausted.
5.Prohibits the existence of a contract between a health care
provider, a provider's medical group, or a hospital that
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provided the transplantation or follow-up care and a Medi-Cal
managed care plan and a Medi-Cal managed care plan, or the
beneficiary's prior enrollment in a managed care plan from
being considered as a factor in determining the extension of a
MER under this bill. Prohibits the contracts from being used
as a reason or basis for returning a beneficiary who has
received one or more of these procedures to a Medi-Cal managed
care plan.
FISCAL EFFECT : This bill has not been analyzed by a fiscal
committee.
COMMENTS :
1.Author's statement. According to the author, Medi-Cal
beneficiaries in Los Angeles County needing cancer care often
begin as fee-for-service enrollees and receive their cancer
care through City of Hope (COH). Because these beneficiaries
must enroll in a Medi-Cal managed care plan, they request an
exemption from mandatory enrollment (known as a Medical
Exemption Request or MER) in a Medi-Cal managed care plan.
When patients receive a MER, they must return to a Medi-Cal
managed care plan after 12 months unless the MER is extended.
In addition, the patient is ineligible for a MER if their
treating provider has a contract with the patient's managed
care plan.
For patients receiving complex cancer care involving
transplantation, any interruption in their continuity of care
has the potential for catastrophic consequences, up to and
including loss of life. This is particularly true of cancer
care involving transplants as appropriate and follow-up care
is crucial in preventing adverse treatment outcomes. This bill
would allow cancer patients who have already received a MER,
and who normally would be required to go back into Medi-Cal
managed care, to obtain an additional 12-month extension on
their MER so they can remain with their treating physician. It
would also allow a patient to continue seeing his or her
treating provider when that provider has a contract with a
Medi-Cal managed care plan to address a situation when a
community provider or medical group fails to return a patient
to COH because the community provider believes it can manage
that patient's cancer care. Finally, this bill would prohibit
transitioning a patient into a Medi-Cal managed care prior to
any and all appeals by the patient protesting the transition
being exhausted.
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2.Background on Medi-Cal managed care. There are two main
Medi-Cal systems for the delivery of medical services:
fee-for-service (FFS) and managed care. In a FFS system, a
health care provider receives an individual payment from DHCS
for each medical service delivered to a beneficiary.
Beneficiaries in Medi-Cal FFS generally may obtain services
from any provider who has agreed to accept Medi-Cal FFS
payments. In managed care, DHCS contracts with managed care
plans to provide health care coverage for Medi-Cal
beneficiaries. Managed care enrollees may obtain services from
providers who contract with the managed care plan, also known
as a plan's "provider network."
Managed care is increasingly becoming the dominant delivery
system in the Medi-Cal program as both the number and the
percentage of Medi-Cal beneficiaries required to enroll in
managed care continues to grow. With the exception of certain
populations (former foster youth, beneficiaries eligible for
limited scope services, individuals dually eligible for
Medicare and Medi-Cal in most counties, and individuals
receiving a MER), enrollment in managed care is mandatory for
Medi-Cal beneficiaries. Roughly 65 percent of Medi-Cal
beneficiaries were enrolled in managed care in 2012-13. The
Governor's budget projects that, on average, 70 percent of
beneficiaries will be enrolled in managed care in 2013-14 and
73 percent (about 7.5 million Medi-Cal beneficiaries) will be
enrolled in managed care in 2014-15.
3.Medical Exemption Request. A Medi-Cal beneficiary with a
complex medical condition can request to remain in
fee-for-service Medi-Cal for up to 12 months as an alternative
to mandatory enrollment in a Medi-Cal managed care plan by
submitting a MER. Conditions meeting the criteria for a
complex medical condition include, and are similar to, the
following:
a. Pregnancy;
b. Need for an organ transplant;
c. Receiving chronic dialysis treatment;
d. HIV positive or has AIDS;
e. Has been diagnosed with cancer and is
currently receiving chemotherapy or radiation therapy
or another course of accepted therapy for cancer that
will continue for up to 12 months or has been approved
for such therapy;
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f. Has been approved for a major surgical
procedure;
g. Has a complex neurological disorder; or,
h. Is enrolled in specified waiver or pilot
programs.
A Med-Cal beneficiary granted a MER must be allowed to remain
with the FFS provider only until the medical condition has
stabilized to a level that would enable the individual to
change physicians and begin receiving care from a plan
provider without deleterious medical effects, as determined by
a beneficiary's treating FFS physician, up to 12 months from
the date the MER was first approved. MERs are not approved for
an eligible beneficiary who has been a member of either plan
on a combined basis for more than 90 calendar days, who has a
current Medi-Cal provider who is contracting with either plan,
or who began, or was scheduled to begin, treatment after the
date of plan enrollment. Extensions of the MER can be granted
if the eligible beneficiary continues to meet MER eligibility
requirements.
DHCS indicates MERS can be approved by a nurse, but MERS can
only be denied by a physician. DHCS' handling of MERS is the
subject of litigation by legal aid groups on behalf of
beneficiaries who were denied MERS by DHCS.
1.Data on MER extensions. In discussions regarding this bill
between proponents and DHCS regarding how MERS are currently
addressed, City of Hope forwarded information on 16 Medi-Cal
beneficiaries who have received care at the hospital. DHCS
indicates, for two beneficiaries, there was no record of a MER
being filed. For the fourteen remaining beneficiaries, there
were 42 MERs filed. DHCS indicates about 55 percent were
approved and 45 percent were denied. DHCS states that no MERs
were denied for clinical considerations (denials were due to
forms not being filled out correctly or MERS being filed on
behalf of beneficiaries who already have access to the
provider who filed the MER). Specifically, DHCS indicates MER
denials were due to the following:
a. Forms being illegible or not filled out
completely by the provider (7);
b. The provider was within the managed care plan
network and therefore a MER was not needed (6);
c. A exemption was already on file (5); and,
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d. The beneficiary was already in fee-for-service
(1).
For MER denials based on illegible or incomplete forms, DHCS
indicates its vendor would have faxed the provider and made
five outbound calls in an attempt to obtain the missing
information prior to the MER being denied. The beneficiary
would then be mailed a denial letter that outlines appeal
rights and a 30 day mandatory enrollment process if the
beneficiary does not file an additional MER or appeal the
denial. The overall number of MERS received by year and the
approval rate is below:
MERS for 2011-2013
Year Number Percent Approved
2011 70,851 43
2012 67,089 42
2013 52,714 68
1.Prior legislation. AB 1553 (Monning) of 2012 would have
established requirements and a process for MERS in Medi-Cal
Managed Care by codifying and revising existing regulations.
AB 1553 was never heard in the Senate Health Committee.
2.Support. This bill is sponsored by the City of Hope (COH),
which writes that this bill would allow patients who have
received allogeneic bone marrow/blood stem cell transplants to
receive subsequent MERs when the treating provider indicates
that a transition to another provider would be deleterious to
their medical condition and would compromise their prognosis
and outcome. COH states that Medi-Cal beneficiaries who are
eligible for allogeneic transplantation can receive a MER, but
the MER may expire before the patient is fully ready to be
released from the care of its transplant physicians. Despite
efforts to seek extensions, COH states the patients are often
sent back to community physicians who lack adequate training
and expertise to manage immunosuppressive drugs, spot emerging
signs of graft versus host disease or recognize potentially
lethal viral and opportunistic infections, resulting in
patients whose care has been severely and potentially
irrevocably compromised. If these patients ultimately return
to COH, their cancer may have relapsed, or they may have
severe infections, tumors or disabling symptoms of graft
versus host disease which can cost these patients their lives
and also cost the Medi-Cal program significantly more when
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patients have to be re-hospitalized and undergo more
aggressive treatment. COH argues these tragedies occur even
when it has a contract with the Medi-Cal managed care plan
because often it lacks a contract with the patient's delegated
medical group, thus making the patient ineligible for a MER.
This bill would address these problems by requiring a MER be
extended despite the presence of a contract between the plan
and COH, and would preclude any transition of these patients
until all avenues of redress are exhausted.
SUPPORT AND OPPOSITION :
Support: City of Hope (sponsor)
American Federation of State, County and Municipal
Employees, AFL-CIO
California Healthcare Institute
Stanford Hospital & Clinics
Oppose: None received
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