CMA’s 2009 Legislative Wrap-Up
By Dustin Corcoran
Senior Vice-President
This year marked another significant erosion of California’s financial situation, forcing the Governor and legislature to grapple with a multi-billion dollar budget deficit. Political observers surely felt that Sacramento had fallen into a time-warp as partisan bickering over-shadowed problem solving leaving Californians to endure another historically late budget. Other pressing matters including prison reform, water shortages, and California’s ever increasing number of uninsured took a back seat to the budget deficit.
In 2008 the Governor signed two separate budget accords that were supposed to solve California’s budget woes. Those deals proved to be badly out of balance almost immediately after they were signed. Facing a $40 billion budget deficit, legislators were forced to reconvene in early 2009 and pass a new budget that supposedly would keep California solvent through 2010. That budget contained $15 billion in cuts, $12.5 billion in new taxes, $7.8 billion in federal stimulus money, and $5.4 billion in borrowing. That budget also fell short, causing the state to face a $21 billion deficit by July 2009.
The continual focus on the budget and the ongoing need to make massive cuts or find new revenues paralyzed lawmakers for months. Democrats refused to consider any additional cuts and Republicans were equally adamant that they would not support any new taxes.The partisan stalemate forced California to start the new fiscal year on July 1st without a balanced budget in place. Many thousands of state workers and businesses that contract with state went unpaid, hospitals were left without reimbursement and some patients lost their state-provided health insurance while the Governor and legislators continued to feud over a solution.
Finally, on July 28th, Governor Schwarzenegger signed a new “balanced budget” that primarily relied on massive cuts and billions in borrowing to fill the deficit. But even that budget is now $4 billion in the red as California’s economy continues to struggle and next year’s budget deficit may exceed $10 billion based on current estimates. It is very likely that the legislature will once again have to take mid-year action to address the deficit now and in the future.
To make matters worse the Governor continued his well worn pattern of veiled threats toward legislators for their failure to act on issues such as the budget, water and prisons. The Governor used a variety of methods to try to force legislators to act. At one point the Governor sent Senate President Pro Tem Darrell Steinberg (D-Sacramento) a bronzed sculpture of bull testicles insinuating that the legislature needed a pair. Not surprisingly Steinberg and other legislators were not amused.
By the end of the legislative session the Governor threatened to veto all legislation sent to him until lawmakers sent him a water deal he found acceptable. That threat caused considerable consternation among Republicans and Democrats alike. Ultimately the Governor backed off from his threat and acted on the bills before him. The continuing strain between the legislature and the Governor does not bode well as major problems facing the state continue to loom. Is it any wonder that the Field Poll recently found that both the Governor and legislature suffer from historically low approval ratings of 27% and 13% respectively? The only Governor with lower approval ratings than Schwarzenegger was Gray Davis, the man that Schwarzenegger replaced through a recall election in 2003.
For CMA it was another busy year. State budget cuts consumed many hours of hard work as we worked to defend the already abysmally low Medi-Cal reimbursement rates. Ultimately CMA’s Center for Legal Affairs was forced to sue the state to block the Governor’s attempts to reduce rates by ten percent. Fortunately the court found in favor of physicians and ordered an injunction against the state prohibiting implementation of the cuts.
In the Legislature we faced fights difficult and sometimes ugly – fights over scope of practice, peer review, the bar on the corporate practice of medicine and rescission of insurance policies. Fortunately, CMA was able to defeat every bill that we opposed. Not a single bill we opposed made it to the Governor and every scope bill was defeated in their first committee.
The pharmacists, nurse practitioners, and physical therapists all pursued scope of practice expansions this year. Pharmacists attempted to get legislative approval to administer vaccines directly to patients without a physician protocol. That bill was overwhelmingly defeated. The nurse practitioners finally abandoned their efforts to establish independent practice and worked proactively with CMA to provide greater clarity to their practice protocols. The physical therapist legislation proved to be the most contentious scope bill of the year with their legislative staff asserting that physical therapists were more qualified to diagnose patients than physicians. Needless to say that argument did not carry the day and the bill was soundly rejected.
This year the fight to preserve the prohibition on the corporate practice of medicine was difficult to say the least. Three bills were introduced to destroy or undermine the corporate bar and allow for the direct employment of physicians by hospitals. Both the California Hospital Association and the American Federation of State, County and Municipal Employees union sponsored measures to take direct control of physicians through employment. The bills were passed out of the Assembly but were defeated in the State Senate. Both organizations have made it clear that they intend to pursue their efforts next year so the fight will continue.
CMA sponsored several bills and ultimately three made it through the legislative process and to the Governor. The first bill, AB 2, would have prohibited insurance companies from rescinding a patients insurance policy without proving that the patient intentionally misled the company when they sought coverage. Unfortunately this bill was vetoed by the Governor. Our second sponsored bill which would have made needed changes to the peer review system was also vetoed. The Governor did sign our third sponsored bill, SB 606, to expand the Steven M. Thompson medical school loan repayment program to provide additional funding to physicians willing to practice in underserved areas.
Overall it was another year that was lost to the budget morass that the State continues to find itself in. It is likely that the final year of Gov. Schwarzenegger’s term will again be dominated by budget deficits. The projected $10 billion shortfall will be extremely difficult to address since the state is out of easy or politically acceptable means of bridging the gap.
Perhaps Wimpy will take Minerva’s place on the Seal of the Great State of California.
CMA Sponsored Legislation
AB 2 (De La Torre) UNLAWFUL RECISSION: INDEPENDENT REVIEW
This bill would have provided protection to patients by requiring a health care service plan or health insurer to obtain final approval from an independent review organization prior to rescinding a health plan contract or insurance policy. This review would have used a clear legal framework to determine whether the rescission was appropriate while protecting the enrollee's rights during the review process. The bill would also have improved the process at the front-end by requiring plans and insurers to complete medical underwriting prior to issuing a policy and made applications easier to fill out accurately and completely. This was a reintroduction of AB 1945, which was vetoed in 2008.
Vetoed by Governor on 10/11/09
AB 120 (Hayashi) PEER REVIEW
Nearly all peer review done in California is done efficiently, timely, and in a manner that protects patients from quality of care deficiencies. However, the current peer review system could have been strengthened. For example, improper or biased review could be utilized to remove physicians for non-quality of care concerns. In rare circumstances peer review can be delayed to the point that patients are placed in danger by the inability to promptly remove a physician that is providing substandard care. AB 120 would have improved an already robust system to make it even more effective in ensuring high quality care in CA hospitals.
Vetoed by Governor on 10/11/09
AB 497 (Block) HIGH OCCUPANCY VEHICLE LANE ACCESS FOR PHYSICIANS
This bill would have allowed physicians to use the high occupancy vehicle (carpool) lanes on the freeway when responding to an emergency. This bill would have expanded current law which allows physicians, with the appropriate decal on their car, to exceed speed limits when responding to an emergency.
Failed in Senate Transportation & Housing Committee, reconsideration granted
AB 526 (Fuentes) PUBLIC PROTECTION AND PHYSICIAN HEALTH PROGRAM ACT OF 2009
This bill would have created the Patient Protection and Physician Health Program in California. The bill would have allowed physicians with mental health or addiction problems to seek help leading to appropriate treatment and monitoring prior to harming a patient. With the closure of the Medical Board Diversion Program there is not a sufficient program available for physicians seeking help. This was a reintroduction of AB 214 of last year.
Held on the Senate Appropriations Committee Suspense File
AB 583 (Hayashi) HEALTH CARE PRACTITIONERS: DISCLOSURE OF EDUCATION
CMA co-sponsored this bill with the California Society of Plastic Surgeons. It has become increasingly difficult for the public to identify the license, education, and training of health care professionals who practice in the state and many are unable to distinguish between physicians and non-physicians. To protect the public's health and safety, this "truth in advertising" legislation would have required a health care professional to disclose information in various health care settings to help patients understand who will be helping them with their health care, such as information about their license, education, and recognized board certification.
Two-year bill, on the Senate Floor
AB 1201 (M. Perez) ADEQUATE REIMBURSEMENT FOR VACCINES
CMA co-sponsored this bill with the American Academy of Pediatrics and the California Academy of Family Physicians. The bill required plans/insurers to adequately reimburse for both the acquisition and administrative costs of giving shots, such as purchasing the vaccine, storage, inventory, staff time, supplies, etc. This bill also would have prohibited plans from applying co-pays, deductibles and other cost-sharing mechanisms to immunizations.
Held on Assembly Appropriations Committee Suspense File
SB 606 (Ducheny) STEVEN M. THOMPSON LOAN REPAYMENT PROGRAM: OSTEOPATHIC PHYSICIANS
CMA co-sponsored this bill with the Osteopathic Physicians and Surgeons of California to allow Osteopathic Physicians (DOs) to access the Steve Thompson Loan Repayment Program (STLRP). The STLRP is currently available to MDs, but not to DOs, who tend to focus on primary care and would be good candidates for the program. This legislation makes DOs eligible for the STLRP and requires them to pay an additional $25 fee toward the program, as MDs are now required to do.
Signed by the Governor, Effective 1/1/10
CMA Opposed Legislation
SB 726 (Ashburn) HOSPITALS: EMPLOYMENT OF PHYSICIANS AND SURGEONS
This bill, as amended in Assembly Health Committee, would have allowed virtually all Healthcare Districts and Rural Hospitals to directly employ up to 5 physicians in a pilot program. The CEO of a facility would have had to show they had been unsuccessful in recruiting a physician for 12 months, that no currently contracted physician or physician with privileges would be supplanted, and the physician was not recruited from an FQHC. Employment contracts could have been be up to 10 years but would be renewed if signed prior to December 31, 2017. The Medical Board of California would have been responsible for an interim report on the success of the pilot program due in 2013 with a final report due in 2016.
Placed on Assembly Inactive File
AB 646 (Swanson) PHYSICIANS AND SURGEONS: EMPLOYMENT
This bill was amended in Assembly Health Committee to establish a pilot program to allow Healthcare Districts located in an underserved area to directly employ and charge for physician services. Districts would have been allowed to hire up to 5 physicians with an ability to request up to 5 additional contracts and to limit the pilot to 10 years.
This bill was amended in Assembly Health Committee to establish a pilot program to allow Healthcare Districts located in an underserved area to directly employ and charge for physician services. Districts would have been allowed to hire up to 5 physicians with an ability to request up to 5 additional contracts and to limit the pilot to 10 years.
Failed in Senate Business & Professions Committee
AB 648 (Chesbro) RURAL HOSPITALS: PHYSICIAN SERVICES
This bill, as amended in Assembly Health, would have allowed a rural hospital that served an underserved area or population to directly employ and charge for physician services. The demonstration project would have lasted up to 10 years and allowed the hospital to employ up to 10 physicians. To be eligible, the hospital had to demonstrate that it could document that it had been unsuccessful in recruiting a physician for 12 months and the CEO certified to the MBC that there was a critical unmet need in the community.
This bill, as amended in Assembly Health, would have allowed a rural hospital that served an underserved area or population to directly employ and charge for physician services. The demonstration project would have lasted up to 10 years and allowed the hospital to employ up to 10 physicians. To be eligible, the hospital had to demonstrate that it could document that it had been unsuccessful in recruiting a physician for 12 months and the CEO certified to the MBC that there was a critical unmet need in the community.
Failed in Senate Business & Professions Committee, reconsideration granted
AB 721 (Nava) PHYSICAL THERAPY DIRECT ACCESS
This bill would have substantially expanded the scope of practice for physical therapists in California by allowing them to evaluate and treat patients without a previous diagnosis or referral from a licensed physician. Current law does not specifically address physical therapy treatment without referral, but the law does prohibit therapists from making medical diagnoses.
This bill would have substantially expanded the scope of practice for physical therapists in California by allowing them to evaluate and treat patients without a previous diagnosis or referral from a licensed physician. Current law does not specifically address physical therapy treatment without referral, but the law does prohibit therapists from making medical diagnoses.
Failed in Assembly Business & Professions, reconsideration denied
AB 1126 (Hernandez) THE PUBLIC EMPLOYEES’ HEALTH CARE ACT: BILLING DISPUTES
This bill would have prohibited a health care provider giving emergency services and care from seeking reimbursement or attempting to obtain payment for any covered services provided to an employee or annuitant enrolled under the Public Employees' Health Care Act (PEMHCA). This bill specifically noted that the affected emergency services providers included but were not limited to hospitals and hospital-based physicians such as radiologists, pathologists, anesthesiologists, and on-call specialists.
This bill would have prohibited a health care provider giving emergency services and care from seeking reimbursement or attempting to obtain payment for any covered services provided to an employee or annuitant enrolled under the Public Employees' Health Care Act (PEMHCA). This bill specifically noted that the affected emergency services providers included but were not limited to hospitals and hospital-based physicians such as radiologists, pathologists, anesthesiologists, and on-call specialists.
2-year bill, in Assembly PERS Committee
AB 1218 (Jones) HEALTH INSURANCE RATE REGULATION
This bill would have required the Department of Managed Health Care (DMHC) and Department of Insurance (DOI) to approve any increase in the amount of the premium, copayment, coinsurance obligation, deductible, and other charges under the health care service plan or health insurance policy. CMA opposed similar legislation in 2005 (SB 26) and 2006 (SB 425) because of concern that such rate regulation could lead to rate regulation of provider reimbursement.
This bill would have required the Department of Managed Health Care (DMHC) and Department of Insurance (DOI) to approve any increase in the amount of the premium, copayment, coinsurance obligation, deductible, and other charges under the health care service plan or health insurance policy. CMA opposed similar legislation in 2005 (SB 26) and 2006 (SB 425) because of concern that such rate regulation could lead to rate regulation of provider reimbursement.
Failed in Assembly Health, reconsideration granted
AB 1458 (Davis) DRUGS: ADVERSE EFFECTS REPORTING
This bill would have required health care professionals to report “suspected serious adverse drug events that are spontaneously discovered or observed” to MedWatch, a drug safety and adverse event reporting system operated by the federal FDA. This bill would have placed an unnecessary mandate on the practice of medicine.
This bill would have required health care professionals to report “suspected serious adverse drug events that are spontaneously discovered or observed” to MedWatch, a drug safety and adverse event reporting system operated by the federal FDA. This bill would have placed an unnecessary mandate on the practice of medicine.
Held on Assembly Assembly Appropriations Committee Suspense File
AB 1478 (Ammiano) WRITTEN ACKNOWLEDGEMENT: MEDICAL NUTRITION THERAPY
This bill would have required that a physician, prior to providing care for diabetes or heart disease, must inform the patient or the patient's legal representative of the option of “medical nutrition therapy” treatment for diabetes or heart disease, including a description of the potential risks, consequences, and benefits; and obtain written acknowledgment from the patient or the patient' s legal representative confirming that the patient received this information. The failure of a physician and surgeon to comply with this requirement would have constituted unprofessional conduct.
This bill would have required that a physician, prior to providing care for diabetes or heart disease, must inform the patient or the patient's legal representative of the option of “medical nutrition therapy” treatment for diabetes or heart disease, including a description of the potential risks, consequences, and benefits; and obtain written acknowledgment from the patient or the patient' s legal representative confirming that the patient received this information. The failure of a physician and surgeon to comply with this requirement would have constituted unprofessional conduct.
2-year bill, in Assembly Business & Professions Committee
SB 700 (Negrete McLeod) PEER REVIEW
As amended April 13th, this bill would have required an 805 report to be filed with the MBC prior to the 809 hearing process. The bill would have circumvented the fair hearing process and not allowed a physician to test the validity of charges prior to an 805 report being filed. Further it would have required peer review at individual physician offices even though many are covered by medical staff membership, participation with groups of 25 or more physicians, or through contracts with insurers. The bill also called for more 805 reports for alleged misconduct.
Placed Senate Inactive File
SB 810 (Leno) SINGLE PAYER HEALTH CARE
This bill was a reintroduction of SB 840 (Kuehl) from last session. The bill would have created a single-payer system of health care in California. Specifically, SB 810 created a single payer purchasing pool and would have prohibited most private health insurance from being sold.
Held on Senate Appropriations Committee Suspense File
Bills of Interest
This bill, supported by CMA, contains a 2.35% tax upon the total operating revenue of Medi-Cal managed care plans until January 1, 2011 in order to draw down federal funds that will help fund the Healthy Families Program (HFP). Approximately 1/3 of the revenue resulting from this tax will be returned to the plans through higher reimbursement rates and the remaining 2/3 of the revenue will be directed to the HFP. The bill also increases premiums in the HFP. The bill also allows the Managed Risk Medical Insurance Board, during the 2009-10 and 2010-11 fiscal years, to adopt regulations to modify benefits, program requirements and operations on an emergency basis. The bill also allows the state Children and Families First Commission (created by Proposition 10) to direct “unneeded revenue” from specific accounts into their Unallocated Account. This carefully crafted bill is a “win-win” that contains a temporary approach to restore desperately needed funding to the HFP and protect access to health care for uninsured children while a long-term solution can be identified.
Signed by the Governor, took effect 9/22/09
AB 542 (Feuer) NON-PAYMENT FOR ADVERSE EVENTS (Watch)
In the face of strong CMA opposition, this bill was dramatically narrowed by the author before its first committee hearing. The bill now would apply only to hospitals and merely requires the state to adopt regulations establishing uniform policies and practices governing the nonpayment to hospitals for hospital acquired conditions by public and private payers, consistent with those developed by the federal Centers for Medicare and Medicaid Services (CMS). The original problematic language creating a state Patient Safety Committee that would substantiate a broader list of adverse events and determine nonpayment policies for all providers was removed. CMA will continue to provide suggestions to further improve this bill and will stay engaged in the discussion.
In the face of strong CMA opposition, this bill was dramatically narrowed by the author before its first committee hearing. The bill now would apply only to hospitals and merely requires the state to adopt regulations establishing uniform policies and practices governing the nonpayment to hospitals for hospital acquired conditions by public and private payers, consistent with those developed by the federal Centers for Medicare and Medicaid Services (CMS). The original problematic language creating a state Patient Safety Committee that would substantiate a broader list of adverse events and determine nonpayment policies for all providers was removed. CMA will continue to provide suggestions to further improve this bill and will stay engaged in the discussion.
2- year bill, in Senate Health Committee
AB 613 (Beall) MEDI-CAL TAR REFORM (Support)
This bill would have required the Department of Health Care Services (DHCS) to improve and streamline the treatment authorization request process by, among other things, performing a cost-benefit analysis for each TAR and reducing the number of TARs required, developing alternative approaches for fraud and abuse detection, developing an alternative to the requirement that a patient obtain a TAR for each individual day of his or her stay in the hospital and consider adopting a single TAR for the entire length of a patient's hospital stay, and make publicly available the rules and criteria for determining medical necessity.
This bill would have required the Department of Health Care Services (DHCS) to improve and streamline the treatment authorization request process by, among other things, performing a cost-benefit analysis for each TAR and reducing the number of TARs required, developing alternative approaches for fraud and abuse detection, developing an alternative to the requirement that a patient obtain a TAR for each individual day of his or her stay in the hospital and consider adopting a single TAR for the entire length of a patient's hospital stay, and make publicly available the rules and criteria for determining medical necessity.
Held on Assembly Appropriations Committee Suspense File
AB 832 (Jones) SURGICAL CLINIC LICENSING (Watch)
In the face of strong CMA opposition, this bill was completely gutted by the author before its first committee hearing. The original problematic and unnecessary language that would have required all physician-owned surgical clinics to be licensed by the state was removed and replaced with language requiring the Department of Public Health to convene a workgroup to discuss the licensing of ambulatory surgical centers. CMA will have a representative on the workgroup, as will other impacted physician specialty organizations, and we will continue to make the case that the existing accreditation process is more than adequate and protects patient safety.
In the face of strong CMA opposition, this bill was completely gutted by the author before its first committee hearing. The original problematic and unnecessary language that would have required all physician-owned surgical clinics to be licensed by the state was removed and replaced with language requiring the Department of Public Health to convene a workgroup to discuss the licensing of ambulatory surgical centers. CMA will have a representative on the workgroup, as will other impacted physician specialty organizations, and we will continue to make the case that the existing accreditation process is more than adequate and protects patient safety.
Held on Assembly Appropriations Committee Suspense File
AB 834 (Solorio) PEER REVIEW (Watch/Refer)
As amended April 14th, this bill would have established an alternative to the 805 process when a physician and surgeon accepts remediation in lieu of the filing of a report. The bill would have allowed a peer review body to impose, if the physician accepts, remediation in the form of mandatory proctoring, consultation, education or retraining. The peer review body could place limits on the physician’s privileges during remediation. A report would be submitted to the MBC upon commencement and conclusion of the remediation or if the remediation was not successfully completed. This bill was referred to policy for development of this “805 lite” program.
2-year bill, in Assembly Business & Professions Committee
AB 877 (Emmerson) SCOPE OF PRACTICE REVIEW COMMITTEE (Support)
This bill was amended from an “intent” bill, to having substantive language creating a scope of practice committee to perform an occupational analysis on any bills seeking to substantively expand the scope of a healing arts practice. The American Medical Association (AMA) has sample language for this issue and has been supportive of state efforts to create scope review committees. The author took language from AMA, and worked with our office for suggestions on making the review committee one that does not recommend but rather gives a review as to education and training, current law of other states and evaluate the quality and cost of health for proposed scope expansions.
This bill was amended from an “intent” bill, to having substantive language creating a scope of practice committee to perform an occupational analysis on any bills seeking to substantively expand the scope of a healing arts practice. The American Medical Association (AMA) has sample language for this issue and has been supportive of state efforts to create scope review committees. The author took language from AMA, and worked with our office for suggestions on making the review committee one that does not recommend but rather gives a review as to education and training, current law of other states and evaluate the quality and cost of health for proposed scope expansions.
Held on Assembly Appropriations Committee Suspense File
AB 977 (Skinner) PHARMACISTS: IMMUNIZATION ADMINISTRATION (Watch)
The author gutted her bill after it failed in committee in the face of strong CMA opposition. The bill would have allowed pharmacists to independently initiate and administer immunizations to children and adults and now only contains uncodified language requesting the California Pharmacists Association to provide information to the chairpersons of Business and Professions and Health Committees on the status of immunization protocols between independent pharmacists and physicians. CMA monitored the bill closely to ensure that any study conducted was unbiased and narrowly focused and ensured that objectionable language was not inserted at a later date.
The author gutted her bill after it failed in committee in the face of strong CMA opposition. The bill would have allowed pharmacists to independently initiate and administer immunizations to children and adults and now only contains uncodified language requesting the California Pharmacists Association to provide information to the chairpersons of Business and Professions and Health Committees on the status of immunization protocols between independent pharmacists and physicians. CMA monitored the bill closely to ensure that any study conducted was unbiased and narrowly focused and ensured that objectionable language was not inserted at a later date.
2-year bill, in Assembly Health Committee
SB 58 (Aanestad) PEER REVIEW (Watch)
This bill was amended to require a peer review body to administer an Early Detection and Resolution Program to allow physicians to complete additional training, while privileges were limited, prior to the filing of a disciplinary quality report. The bill would also have allowed a physician to submit explanatory or exculpatory information when an 805 report was filed and required the MBC to remove expunged reports from a physicians file. This bill was heavily negotiated with peer review reforms.
Held on Senate Appropriations Committee Suspense File
SB 196 (Corbett) EMERGENCY MEDICAL SERVICES (Support)
The transparency provisions previously contained in the bill were eliminated by amendments taken on 6/18/2009. The bill would have required a hospital to provide 180 days notice and hold public hearings prior to the elimination of emergency services.
Vetoed by the Governor on 10/11/09
SB 294 (Negrete McLeod) HEALING ARTS (Watch)
This bill was stripped of the two most egregious proposals, allowing nurse practitioners (NP) to admit patients and permitting NP’s to be designated primary care providers. The current version allowed, in accordance with standardized procedures, to approve and modify home health services, certify disability and order durable home health equipment. The intent language was narrowed at CMA’s request to more accurately reflect the bill and the scope of practice of NPs.
Near the end of session, new language was added to the bill to address perceived deficiencies in several health related licensing boards. The bill would have taken disciplinary and investigatory provisions that applied to physicians and applied them to other professions such as dentists, nurses, and optometrists. There was little change for physicians since most amended code sections specifically exempted physicians.
2-year bill, in Assembly Business & Professions Committee
Last Updated Wednesday, November 25, 2009 - 01:10 PM.
Back to Current News