Bill Text: CA AB2744 | 2015-2016 | Regular Session | Chaptered
Bill Title: Healing arts: referrals.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Passed) 2016-09-14 - Chaptered by Secretary of State - Chapter 360, Statutes of 2016. [AB2744 Detail]
Download: California-2015-AB2744-Chaptered.html
BILL NUMBER: AB 2744 CHAPTERED
BILL TEXT
CHAPTER 360
FILED WITH SECRETARY OF STATE SEPTEMBER 14, 2016
APPROVED BY GOVERNOR SEPTEMBER 14, 2016
PASSED THE SENATE AUGUST 16, 2016
PASSED THE ASSEMBLY AUGUST 23, 2016
AMENDED IN SENATE AUGUST 8, 2016
AMENDED IN SENATE JUNE 16, 2016
AMENDED IN SENATE JUNE 6, 2016
AMENDED IN ASSEMBLY APRIL 11, 2016
INTRODUCED BY Assembly Member Gordon
(Coauthor: Senator Hill)
FEBRUARY 19, 2016
An act to amend Section 650 of the Business and Professions Code,
relating to the healing arts.
LEGISLATIVE COUNSEL'S DIGEST
AB 2744, Gordon. Healing arts: referrals.
Existing law provides for the licensure and regulation of various
healing arts professions and vocations by boards within the
Department of Consumer Affairs. Under existing law, it is unlawful
for licensed healing arts practitioners, except as specified, to
offer, deliver, receive, or accept any rebate, refund, commission,
preference, patronage dividend, discount, or other consideration, in
the form of money or otherwise, as compensation or inducement for
referring patients, clients, or customers to any person. Existing law
makes a violation of this provision a public offense punishable upon
a first conviction by imprisonment, as specified, or a fine not
exceeding $50,000, or by imprisonment and that fine.
This bill would provide that the payment or receipt of
consideration for advertising, wherein a licensed healing arts
practitioner offers or sells services through a third-party
advertiser, does not constitute a referral of patients when the
third-party advertiser does not itself recommend, endorse, or
otherwise select a licensee. The bill would require that the fee paid
to the third-party advertiser be commensurate with the service
provided by the third-party advertiser. The bill would require the
purchaser of the service to receive a refund of the full purchase
price if the licensee determines, after consultation with the
purchaser, that the service provided by the licensee is not
appropriate for the purchaser, or if the purchaser elects not to
receive the service for any reason and requests a refund, as
specified. The bill would require that a licensee disclose in the
advertisement that a consultation is required and that the purchaser
will receive a refund if not eligible to receive the service. The
bill would specify that these provisions do not apply to basic health
care services or essential health benefits, as defined. The bill
would also provide that the entity that provides advertising is
required to be able to demonstrate that the licensee consented in
writing to these provisions. The bill would require a third-party
advertiser to make available to prospective purchasers advertisements
for services of all licensees then advertising through the
third-party advertiser in the applicable geographic region and to
disclose, in any advertisement offering a discount price for a
service, the regular, nondiscounted price for that service.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 650 of the Business and Professions Code is
amended to read:
650. (a) Except as provided in Chapter 2.3 (commencing with
Section 1400) of Division 2 of the Health and Safety Code, the offer,
delivery, receipt, or acceptance by any person licensed under this
division or the Chiropractic Initiative Act of any rebate, refund,
commission, preference, patronage dividend, discount, or other
consideration, whether in the form of money or otherwise, as
compensation or inducement for referring patients, clients, or
customers to any person, irrespective of any membership, proprietary
interest, or coownership in or with any person to whom these
patients, clients, or customers are referred is unlawful.
(b) The payment or receipt of consideration for services other
than the referral of patients which is based on a percentage of gross
revenue or similar type of contractual arrangement shall not be
unlawful if the consideration is commensurate with the value of the
services furnished or with the fair rental value of any premises or
equipment leased or provided by the recipient to the payer.
(c) The offer, delivery, receipt, or acceptance of any
consideration between a federally qualified health center, as defined
in Section 1396d(l)(2)(B) of Title 42 of the United States Code, and
any individual or entity providing goods, items, services,
donations, loans, or a combination thereof to the health center
entity pursuant to a contract, lease, grant, loan, or other
agreement, if that agreement contributes to the ability of the health
center entity to maintain or increase the availability, or enhance
the quality, of services provided to a medically underserved
population served by the health center, shall be permitted only to
the extent sanctioned or permitted by federal law.
(d) Except as provided in Chapter 2.3 (commencing with Section
1400) of Division 2 of the Health and Safety Code and in Sections
654.1 and 654.2 of this code, it shall not be unlawful for any person
licensed under this division to refer a person to any laboratory,
pharmacy, clinic (including entities exempt from licensure pursuant
to Section 1206 of the Health and Safety Code), or health care
facility solely because the licensee has a proprietary interest or
coownership in the laboratory, pharmacy, clinic, or health care
facility, provided, however, that the licensee's return on investment
for that proprietary interest or coownership shall be based upon the
amount of the capital investment or proportional ownership of the
licensee which ownership interest is not based on the number or value
of any patients referred. Any referral excepted under this section
shall be unlawful if the prosecutor proves that there was no valid
medical need for the referral.
(e) Except as provided in Chapter 2.3 (commencing with Section
1400) of Division 2 of the Health and Safety Code and in Sections
654.1 and 654.2 of this code, it shall not be unlawful to provide
nonmonetary remuneration, in the form of hardware, software, or
information technology and training services, as described in
subsections (x) and (y) of Section 1001.952 of Title 42 of the Code
of Federal Regulations, as amended October 4, 2007, as published in
the Federal Register (72 Fed. Reg. 56632 and 56644), and subsequently
amended versions.
(f) "Health care facility" means a general acute care hospital,
acute psychiatric hospital, skilled nursing facility, intermediate
care facility, and any other health facility licensed by the State
Department of Public Health under Chapter 2 (commencing with Section
1250) of Division 2 of the Health and Safety Code.
(g) Notwithstanding the other subdivisions of this section or any
other provision of law, the payment or receipt of consideration for
advertising, wherein a licensee offers or sells services through a
third-party advertiser, shall not constitute a referral of patients
when the third-party advertiser does not itself recommend, endorse,
or otherwise select a licensee. The fee paid to the third-party
advertiser shall be commensurate with the service provided by the
third-party advertiser. If the licensee determines, after
consultation with the purchaser of the service, that the service
provided by the licensee is not appropriate for the purchaser or if
the purchaser elects not to receive the service for any reason and
requests a refund, the purchaser shall receive a refund of the full
purchase price as determined by the terms of the advertising service
agreement between the third-party advertiser and the licensee. The
licensee shall disclose in the advertisement that a consultation is
required and that the purchaser will receive a refund if not eligible
to receive the service. This subdivision shall not apply to basic
health care services, as defined in subdivision (b) of Section 1345
of the Health and Safety Code, or essential health benefits, as
defined in Section 1367.005 of the Health and Safety Code and Section
10112.27 of the Insurance Code. The entity that provides the
advertising shall be able to demonstrate that the licensee consented
in writing to the requirements of this subdivision. A third-party
advertiser shall make available to prospective purchasers
advertisements for services of all licensees then advertising through
the third-party advertiser in the applicable geographic region. In
any advertisement offering a discount price for a service, the
licensee shall also disclose the regular, nondiscounted price for
that service.
(h) A violation of this section is a public offense and is
punishable upon a first conviction by imprisonment in a county jail
for not more than one year, or by imprisonment pursuant to
subdivision (h) of Section 1170 of the Penal Code, or by a fine not
exceeding fifty thousand dollars ($50,000), or by both that
imprisonment and fine. A second or subsequent conviction is
punishable by imprisonment pursuant to subdivision (h) of Section
1170 of the Penal Code, or by that imprisonment and a fine of fifty
thousand dollars ($50,000).
