BILL ANALYSIS �
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THIRD READING
Bill No: SB 1315
Author: Monning (D)
Amended: 5/23/14
Vote: 21
SENATE HEALTH COMMITTEE : 8-0, 4/24/14
AYES: Hernandez, Morrell, Beall, De Le�n, DeSaulnier, Evans,
Monning, Wolk
NO VOTE RECORDED: Nielsen
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Medi-Cal: providers
SOURCE : Author
DIGEST : This bill requires a notice of temporary suspension
issued to a health care provider by the Department of Health
Care Services (DHCS) Medi-Cal Provider Enrollment Division to
include a list of discrepancies required to be remediated and
the timeframe in which a provider can demonstrate that the
discrepancies identified have been remediated, which must be at
least 60 days from the date the notice is issued. Requires the
provider to be removed from enrollment as a Medi-Cal provider if
a provider fails to remediate the identified discrepancies, as
specified.
Senate Floor Amendments of 5/23/14 require an on-site visit to
two written notices prior to a health care provider being
removed from enrollment as a Medi-Cal provider.
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ANALYSIS :
Existing law:
1.Requires an applicant, a health care provider who is licensed
or certificated under state law or who is a professional
corporation, to be enrolled in the Medi-Cal program as either
an individual provider or as a rendering provider in a
provider group for each application package submitted and
approved.
2.Requires an applicant that currently is not enrolled in the
Medi-Cal program, or a provider applying for continued
enrollment (upon written notification from DHCS), and a
provider not currently enrolled at a location where the
provider intends to provide services to Medi-Cal
beneficiaries, to submit a complete application package to
DHCS for enrollment, continuing enrollment, or enrollment at a
new location or a change in location.
3.Makes a provider subject to temporary suspension from the
Medi-Cal program, which includes temporary deactivation of the
provider's number, including all business addresses used by
the provider to obtain reimbursement from the Medi-Cal
program, if the provider has failed to remediate significant
discrepancies that are discovered as a result of an announced
or unannounced visit, for purposes of enrollment, continued
enrollment, or certification.
4.Requires the DHCS Director to notify the provider in writing
of the temporary suspension and deactivation of provider
numbers, which is required to take effect 15 days from the
date of the notification.
This bill:
1.Requires a notice of temporary suspension to a Medi-Cal
provider to include the following:
A. A list of discrepancies required to be remediated; and
B. The timeframe in which a provider may demonstrate to
DHCS that the discrepancies identified have been
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remediated, which must be at least 60 days from the date
the notice is issued.
1.Requires DHCS to lift the temporary suspension and to notify
the provider that he/she is eligible to receive Medi-Cal
reimbursement for services provided after the date the
temporary suspension was lifted if a provider demonstrates to
DHCS that:
A. The discrepancies identified have been remediated; and
B. The provider meets the standards of participation within
the timeframe specified.
1.Requires a provider who has received a site visit resulting in
a notice of temporary suspension to be removed from enrollment
as a Medi-Cal provider by operation of law, if a provider
fails to remediate the discrepancies identified within the
timeframe specified after having received two written notices
from DHCS.
Background
Medi-Cal Provider Enrollment Process . State law governing
Medi-Cal and federal Medicaid law and regulations contain
provisions to prevent and address fraud in the Medicaid program.
For example, existing state law requires a health care provider
seeking to provide services in the fee-for-service Medi-Cal
program to submit a complete application package for enrollment,
continued enrollment, enrollment at a new location or a change
in location. DHCS' Provider Enrollment Division indicates it
receives 1,400 applications from providers each month.
Existing law authorizes DHCS to temporarily suspend and
temporarily deactivate a provider when DHCS discovers that the
provider cannot demonstrate program compliance. DHCS informs a
provider of discrepancies that must be remediated when issuing a
letter to the provider informing them of the temporary
suspension. Examples of issues that warrant a temporary
suspension include:
1.Failing to report a change of address;
2.Failing to be open and available to the general public;
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3.Failing to have regularly established and posted business
hours;
4.Failing to report a change in ownership;
5.Failing to have the necessary equipment and facilities to
carry out day-to-day business; and
6.Failing to have the appropriate business or professional
license.
However, DHCS does have the authority to take a final action
against a provider if the provider fails to remediate the
deficiencies that triggered the temporary suspension or
deactivation. In addition, existing law also does not specify a
time period for a provider to become compliant, nor does it
specify the timeframe a temporary suspension can remain in
place.
A provider subject to a temporary suspension cannot receive
reimbursement from the Medi-Cal program. A provider who is
subject to a temporary suspension can appeal DHCS' decision, and
a provider who is removed from Medi-Cal as a result of a
temporary suspension can also reapply.
Prior Legislation
SB 1529 (Alquist, Chapter 797, Statutes of 2012) revises
screening, enrollment, disenrollment, suspensions, and other
sanctions for fee-for service Medi-Cal providers and suppliers
to conform to the federal Affordable Care Act (ACA).
SB 857 (Speier, Chapter 601, Statutes of 2003) made numerous
changes to the Medi-Cal program intended to address provider
fraud, including establishing new Medi-Cal application
requirements for new providers, existing providers at new
locations, and providers applying for continued enrollment.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 5/27/14)
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Department of Health Care Services
ARGUMENTS IN SUPPORT : DHCS writes that the ACA requires
states to implement various program integrity provisions,
including terminating a provider from the Medi-Cal program for
non-compliance with program requirements. DHCS states they have
implemented these provisions, however, no authority has been
granted to them to take a final action against a provider if the
provider fails to remediate the deficiencies that triggered the
temporary suspension or deactivation. In addition, DHCS states
that current law does not specify a time period for a provider
to become compliant, nor does it specify the timeframe a
temporary suspension can remain in place. DHCS believes that
authorizing the additional action to deactivate non-compliant
providers could also reduce the prevalence of fraud and increase
program integrity in compliance with the ACA. DHCS states
this bill will provide DHCS with a corrective action plan to
fully address compliance issues.
JL:e 5/27/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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