Bill Text: CA AB869 | 2023-2024 | Regular Session | Amended

California Assembly Bill 869

Bill Title: Hospitals: seismic safety compliance.

Spectrum: Bipartisan Bill

Status: (Engrossed) 2023-07-10 - In committee: Set, second hearing. Hearing canceled at the request of author. [AB869 Detail]

Download: California-2023-AB869-Amended.html

Amended IN Senate June 20, 2023

Amended IN Assembly March 07, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill

No. 869

Introduced by Assembly Members Wood and Garcia
(Coauthors: Assembly Members Aguiar-Curry, Bennett, Juan Carrillo, Megan Dahle, Vince Fong, Mathis, Wallis, and Weber)
(Coauthor: Senator Grove)

February 14, 2023

An act to add Section 130078.5 to, and to add Chapter 1.6 (commencing with Section 130080) to Part 7 of Division 107 of, the Health and Safety Code, relating to hospitals.

LEGISLATIVE COUNSEL'S DIGEST

AB 869, as amended, Wood. Hospitals: seismic safety compliance.

Existing law requires, no later than January 1, 2030, owners of all acute care inpatient hospitals to either demolish, replace, or change to nonacute care use all hospital buildings not in substantial compliance with specified seismic safety standards or to seismically retrofit all acute care inpatient hospital buildings so that they are in substantial compliance with those seismic safety standards. Existing law requires the Department of Health Care Access and Information to issue a written notice upon compliance with those requirements.

Existing law establishes the Small and Rural Hospital Relief Program under the administration of the Department of Health Care Access and Information for the purpose of funding seismic safety compliance with respect to small hospitals, rural hospitals, and critical access hospitals in the state. Existing law requires the department to provide grants to small, rural, and critical access hospital applicants that meet certain criteria, including that seismic safety compliance, as defined, imposes a financial burden on the applicant that may result in hospital closure. Existing law also creates the Small and Rural Hospital Relief Fund and continuously appropriates the moneys in the fund for purposes of administering and funding the grant program.

Existing law provides for the formation and administration of health care districts.

This bill would require the department to give first priority to grants for single- and 2-story general acute care hospitals located in remote or rural areas with less than 80 general acute care beds and general acute care hospital revenue of $75 million or less. The bill would require grants under the program to provide general acute care hospitals with funds to secure an SPC-4D assessment for purposes of planning for, and estimating the costs of, compliance with certain seismic safety standards, as specified. The bill would authorize specified general acute care hospitals to apply for a grant for purposes of complying with those seismic safety standards.

The bill would delay the requirement to meet those and other building standards for specified general acute care hospitals until January 1, 2035, and would exempt a general acute care hospital with an SPC-4D assessment and with a certain estimated cost from those seismic safety standards if the department determines that the cost of design and construction for compliance results in a financial hardship for the hospital and certain funds are not available to assist with the cost of compliance.

The bill would also authorize a health care district that meets certain criteria to submit financial information to the department, on a form required by the department, to allow the department to determine if the health care district is financially distressed and if so, would allow the health care district to apply for a grant for the purpose of meeting those seismic safety standards. The bill would delay the requirement to meet the seismic safety standards until January 1, 2035, for a health care district that qualifies for those grants. The bill would exempt a health care district hospital from those requirements until funds are made available to meet those requirements if the department determines that the cost of design and construction for compliance with those requirements results in a financial hardship that may result in hospital closure.

The bill would require, by January 1, 2030, and at 2-year intervals thereafter, a hospital or health care district that meets the criteria for the above-described abeyances to provide any information that the department deems necessary to assess whether the hospital or health care district continues to meet those criteria. The bill would require the department to inform a hospital or health care district in writing if it deems the hospital or health care district is no longer qualified for the above-described abeyances. The bill would require the department to post on its internet website a list of hospitals and health care districts that continue to meet the criteria for abeyance.

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO

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

SECTION 1.

Section 130078.5 is added to the Health and Safety Code, to read:

130078.5.

(a) The department shall give the first priority to grants for single- and two-story general acute care hospitals located in remote or rural areas with less than 80 general acute care beds and general acute care hospital revenue of seventy-five million dollars ($75,000,000) or less, as reported to the department pursuant to Section 128740 in 2020.

(b) (1) Grants pursuant to this chapter shall provide general acute care hospitals described in subdivision (a) with funds to secure an SPC-4D assessment for purposes of planning for, and estimating the costs of, complying with Section 130065.

(2) The department shall conduct outreach to general acute care hospitals described in subdivision (a) regarding the availability of these grants and provide technical assistance to hospitals applying for the grants.

(3) A general acute care hospital receiving a grant for an assessment pursuant to this subdivision shall provide the estimated cost of SPC-4D compliance to the department as soon as possible.

(4) The department shall provide grants to secure assessments to general acute care hospitals that qualify within 18 months of the implementation of this section.

(c) (1) (A) Subject to paragraphs (2) and (3), general acute care hospitals that have received a grant for an assessment pursuant to subdivision (b) may apply for a grant for purposes of complying with Section 130065.

(B) Subject to paragraphs (2) and (3), general acute care hospitals that already have a completed SPC-4D assessment may provide that assessment to the department and the department may award the general acute care hospital grant money for purposes of complying with Section 130065.

(2) If state funds are appropriated in the future for the purpose of complying with Section 130065, prior to being awarded state funds, a hospital that qualified for assessment grants under subdivision (b) shall provide the department with financial information on a form as required by the department for the following purposes:

(A) Demonstrating whether or not the hospital has attempted to secure other methods of funding for SPC-4D compliance, including federal funding, and if not, why.

(B) Confirming the accuracy of the SPC-4D cost estimate, and that estimated costs are only for the purpose of SPC-4D compliance.

(C) Demonstrating the hospital’s need for assistance due to financial hardship and lack of ability to finance the required improvements, in order to access state funds.

(3) In awarding grants, the department shall have the authority to deny costs from the assessment completed pursuant to subdivision (b) that the department determines are not necessary to comply with SPC-4D requirements.

(d) General acute care hospitals that qualify for grants as described in subdivision (b) shall be required to comply with NPC-3 standards no later than January 1, 2035.

(e) General acute care hospitals as described in subdivision (a) that apply, and qualify, for grants pursuant to subdivision (c) shall be required to comply with Section 130065 by January 1, 2035.

(f) (1) A general acute care hospital as described in subdivision (a) with a completed assessment pursuant to subdivision (b), with an estimated cost over one million dollars ($1,000,000), or 2 percent of the ~~hospitals~~ hospital’s revenue, whichever is greater, shall not be required to comply with Section 130065 if the department determines that the cost of design and construction for SPC-4D compliance results in a financial hardship for the hospital and state funds, federal grants, or private foundation funds are not available to assist with the cost of compliance.

(2) The department shall confirm a hospital’s lack of ability to comply with Section 130065 and that the cost of compliance may result in hospital closure, or would substantially impact the accessibility to health care in communities surrounding the hospital.

(g) (1) By January 1, 2030, and at two-year intervals thereafter, each hospital whose compliance with the requirements of Section 130065 is in abeyance according to subdivision (f) shall provide to the department any information that the department deems necessary to assess whether the hospital continues to meet the criteria of subdivision (f). If a hospital’s circumstances have not significantly altered, the department shall not require an updated SPC-4D assessment. If the department deems a hospital is no longer qualified for an abeyance, it shall inform the hospital in writing, and the hospital shall comply with Section 130065 within five years of the date of notification, or the length of time spent in abeyance, whichever is greater. The department shall have the discretion to extend the amount of time by which a hospital shall comply with Section 130065 for an additional two years based on the estimated cost of compliance.

(2) The department shall post on its internet website a list of hospitals that continue to meet the criteria for an abeyance from the requirements of Section 130065 pursuant to subdivision (f).

SEC. 2.

Chapter 1.6 (commencing with Section 130080) is added to Part 7 of Division 107 of the Health and Safety Code, to read:

CHAPTER 1.6. Health Care district relief program

130080.

(a) (1) A health care district hospital authorized pursuant to Division 23 (commencing with Section 32000) that meets the criteria described in subdivision (b), may submit financial information to the Department of Health Care Access and Information to allow the department to determine if the health care district hospital is financially distressed, including, but not limited to, the health care district hospital’s percentage of patients on Medi-Cal. The health care district hospital shall provide the department with financial information on a form required by the department for the following purposes:

(A) Demonstrating whether or not the hospital has attempted to secure other methods of funding for coming into compliance with Section 130065, including federal funding, and if not, why.

(B) Demonstrating the hospital’s need for assistance due to financial hardship and lack of ability to finance the required improvements, in order to access state funds.

(2) If the department determines the hospital is financially distressed according to the information submitted pursuant to this subdivision, the health care district hospital may apply to the department for a grant for the purpose of complying with Section 130065. When applying for a grant, the health care district hospital shall provide the department with an estimate of the cost for the hospital to comply with Section 130065.

(b) A health care district hospital may submit information to the department pursuant to subdivision (a) if it meets any of the following requirements:

(1) The health care district meets the requirements for rural hospitals pursuant to subdivision (a) of Section 130078.5.

(2) The health care district has placed a bond measure on the ballot within the last five years regarding compliance with Section 130065 and the measure did not pass.

(3) The Medi-Cal revenue for the health care district exceeds the statewide average percentage of Medi-Cal revenue for hospitals.

(4) The health care district hospital is more than 30 minutes or 30 miles from the nearest hospital.

(c) (1) If state funds are made available for the purpose of complying with Section 130065, prior to awarding state funds, the department shall confirm the accuracy of the health care district’s seismic cost estimate, and that estimated costs are only for the purpose of compliance with Section 130065.

(2) In awarding grants, the department shall have the authority to deny costs that the department determines are not necessary to comply with Section 130065.

(d) (1) Health care district hospitals that qualify for grants as described in subdivision (a) shall be required to comply with Section 130065 no later than January 1, 2035. If the department determines that the cost of design and construction for compliance with Section 130065 results in a financial hardship that may result in hospital closure and state funds, federal grants, or private foundation funds are not available to assist with the cost of compliance, the health care district hospital shall not be required to comply with Section 130065 until funds are made available for the purpose of complying with Section 130065.

(2) The department shall confirm a health care district hospital’s lack of ability to comply with Section 130065 and that the cost of compliance may result in hospital closure, or would substantially impact the accessibility to health care in communities surrounding the health care district hospital.

(3) A health care district hospital in a contractual agreement with a health system that imposes upon the health system any financial responsibility for the health care district hospital’s infrastructure costs shall not be eligible for funds or a delay of compliance with Section 130065 pursuant to this chapter. This paragraph does not apply to a health care district hospital that has a management agreement with a health system that does not impose upon the health system any responsibility for the health care district hospital’s infrastructure costs.

(e) (1) By January 1, 2030, and at two-year intervals thereafter, each health care district hospital whose compliance with the requirements of Section 130065 is in abeyance according to subdivision (d) shall provide to the department any information the department deems necessary to assess whether the hospital continues to meet the requirements of subdivision (d). If the department deems a hospital is no longer qualified for an abeyance, it shall inform the hospital in writing, and the hospital shall comply with Section 130065 within five years of the date of notification, or the length of time spent in abeyance, whichever is greater. The department shall have the discretion to extend the amount of time by which a hospital shall comply with Section 130065 for an additional two years based on the estimated cost of compliance.

(2) The department shall post on its internet website a list of hospitals that continue to meet the requirements for an abeyance form the requirements of Section 130065 pursuant to subdivision (d).