Amended in Assembly June 30, 2014

Amended in Assembly June 4, 2014

Amended in Senate March 28, 2014

Senate Bill No. 1457

Introduced by Senator Evans

February 21, 2014

An act to amend Section 123929 of, and to add Section 125185 to, the Health and Safety Code, and to amend Section 14133.01 of the Welfare and Institutions Code, relating to medical care.

LEGISLATIVE COUNSEL’S DIGEST

SB 1457, as amended, Evans. Medical care: electronic treatment authorization requests.

Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care benefits. The Medi-Cal program is, in part, governed and funded by federal Medicaid Program provisions. Existing law also requires the department to administer various health programs, including the California Children’s Services Program and the Genetically Handicapped Person’s Program.

This bill would, by July 1, 2016, or a subsequent date determined by the department, require requests for authorization for treatment or services begin insert under those programs end insert , excluding those submitted by dental providers enrolled in the Medi-Cal Dental program, to be submitted in an electronic format determined by the department via the department’s Internet Web site or other electronic means. The bill would require the department to designate an alternate format for submitting requests for authorization for treatment or services when the department’s Internet Web site or other electronic means are unavailable due to a system disruption. begin insert The bill would also require the department to consider the capacity of small and rural Medi-Cal providers to comply with these requirements, and to implement the process in a manner that offers these providers reasonable time to establish the infrastructure necessary for the generation of electronic treatment authorization requests and an opportunity to participate in training offered by the department. end insert The bill would authorize the department to implement these provisions in phases and by means of all-county letters, plan letters, provider bulletins, or similar instructions, but would require the department to adopt regulations by July 1, 2017.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 123929 of the Health and Safety Code
is amended to read:

123929.  

(a) Except as otherwise provided in this section and
Section 14133.05 of the Welfare and Institutions Code, California
Children’s Services program services provided pursuant to this
article require prior authorization by the department or its designee.
Prior authorization is contingent on determination by the
department or its designee of all of the following:

(1) The child receiving the services is confirmed to be medically
eligible for the CCS program.

(2) The provider of the services is approved in accordance with
the standards of the CCS program.

(3) The services authorized are medically necessary to treat the
child’s CCS-eligible medical condition.

(b) The department or its designee may approve a request for a
treatment authorization that is otherwise in conformance with
subdivision (a) for services for a child participating in the Healthy
Families Program or the AIM-Linked Infants Program pursuant
to clause (ii) of subparagraph (A) of paragraph (6) of subdivision
(a) of Section 12693.70 of the Insurance Code or Chapter 2
(commencing with Section 15810) of Part 3.3 of Division 9 of the
Welfare and Institutions Code, received by the department or its
designee after the requested treatment has been provided to the
child.

(c) If a provider of services who meets the requirements of
paragraph (2) of subdivision (a) incurs costs for services described
in paragraph (3) of subdivision (a) to treat a child described in
subdivision (b) who is subsequently determined to be medically
eligible for the CCS program as determined by the department or
its designee, the department may reimburse the provider for those
costs. Reimbursement under this section shall conform to the
requirements of Section 14105.18 of the Welfare and Institutions
Code.

(d) (1) By July 1, 2016, or a subsequent date determined by the
department, requests for authorization of services, excluding
requests for authorization of services submitted by dental providers
enrolled in the Medi-Cal Dental program, shall be submitted in an
electronic format determined by the department and shall be
submitted via the department’s Internet Web site or other electronic
means designated by the department. The department may
implement this requirement in phases.

(2) The department shall designate an alternate format for
submitting requests for authorization of services when the
department’s Internet Web site or other electronic means designated
in paragraph (1) are unavailable due to a system disruption.

(3) Notwithstanding Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code,
the department may, without taking regulatory action, implement,
interpret, or make specific this subdivision and any applicable
waivers and state plan amendments by means of all-county letters,
plan letters, plan or provider bulletins, or similar instructions.
Thereafter, the department shall adopt regulations by July 1, 2017,
in accordance with the requirements of Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code. The department shall consult with interested
parties and appropriate stakeholders in implementing this
subdivision.

SEC. 2.  

Section 125185 is added to the Health and Safety Code,
to read:

125185.  

(a) (1) By July 1, 2016, or a subsequent date
determined by the department, Genetically Handicapped Persons
Program (GHPP) requests for authorization of services, excluding
requests for authorization of services submitted by dental providers
enrolled in the Medi-Cal Dental program, shall be submitted in an
electronic format determined by the department and shall be
submitted via the department’s Internet Web site or other electronic
means designated by the department. The department may
implement this requirement in phases.

(2) The department shall designate an alternate format for
submitting requests for authorization of services when the
department’s Internet Web site or other electronic means designated
in paragraph (1) are unavailable due to a system disruption.

(b) Notwithstanding Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code,
the department may, without taking regulatory action, implement,
interpret, or make specific this section and any applicable waivers
and state plan amendments by means of all-county letters, plan
letters, plan or provider bulletins, or similar instructions. Thereafter,
the department shall adopt regulations by July 1, 2017, in
accordance with the requirements of Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code. The department shall consult with interested
parties and appropriate stakeholders in implementing this section.

SEC. 3.  

Section 14133.01 of the Welfare and Institutions Code
is amended to read:

14133.01.  

(a) Notwithstanding any other law, the director or
his or her designee may apply prior authorization by designing a
sampling methodology that will result in a generally acceptable
audit standard for approval of a treatment authorization request
(TAR), or a class of TARs. The director or his or her designee
shall determine the applicable sampling methodology based upon
health care industry standards and discussions with applicable
Medi-Cal providers or their representatives. This sampling
methodology shall be implemented by no later than July 1, 2005,
and an outline of the methodology shall be provided to the fiscal
and policy committees of both houses of the Legislature. It is the
intent of the Legislature for the department to review the sampling
methodology on an ongoing basis and update the methodology as
applicable on a periodic basis in order to keep abreast of health
care industry trends and the need to manage an efficient and
effective Medi-Cal program.

(b) The department shall pursue additional means to improve
and streamline the treatment authorization request process
including, where applicable, those identified by independent
analyses such as the July 2003 report by the California HealthCare
Foundation entitled Medi-Cal Treatment Authorizations and Claims
Processing: Improving Efficiency and Access to Care, and those
identified by Medi-Cal providers. It is the Legislature’s intent that
any identified improvements be cost beneficial to the state and to
the Medi-Cal program as a whole.

(c) (1) By July 1, 2016, or a subsequent date determined by the
department, treatment authorization requests, excluding treatment
authorization requests submitted by dental providers enrolled in
the Medi-Cal Dental program, shall be submitted in an electronic
format determined by the department and shall be submitted via
the department’s Internet Web site or other electronic means
designated by the department. The department may implement
this requirement in phases.

begin insert

(2) The department shall consider the capacity of independent
sole practitioners, small independent provider-owned clinics, and
rural providers to comply with the requirements of this section,
and shall implement the electronic submission process in a manner
that offers these providers both of the following:

end insert begin insert

(A) Reasonable time to establish the infrastructure necessary
for the generation of electronic treatment authorization requests.

end insert begin insert

(B) An opportunity to participate in education and training
regarding the generation and submission of electronic treatment
authorization requests provided by the department or its agents.

end insert begin delete

(2)

end delete

begin insert (3) end insert  The department shall designate an alternate format for
submitting requests for authorization of services when the
department’s Internet Web site or other electronic means designated
in paragraph (1) are unavailable due to a system disruption.

(d) Notwithstanding Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code,
the department may, without taking regulatory action, implement,
interpret, or make specific, this section and any applicable waivers
and state plan amendments by means of all-county letters, plan
letters, plan or provider bulletins, or similar instructions. Thereafter,
the department shall adopt regulations by July 1, 2017, in
accordance with the requirements of Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code. begin insert The department shall consult with interested
parties and appropriate stakeholders in implementing this section end insert begin insert . end insert