Amended  IN  Senate  March 15, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 242

Introduced by Senator Newman
(Coauthors: Senators Hueso and Wiener)
(Coauthors: Assembly Members Robert Rivas and Stone)

January 21, 2021

An act to add Section 1374.192 to the Health and Safety Code, to add Section 10120.35 to the Insurance Code, and to add Section 14079.8 to the Welfare and Institutions Code, relating to health care, and declaring the urgency thereof, to take effect immediately.


LEGISLATIVE COUNSEL'S DIGEST


SB 242, as amended, Newman. Health care provider reimbursements.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of the act a crime. Existing law provides for the regulation of health insurers by the Department of Insurance. Existing law authorizes a health care service plan or health insurer to contract with a provider for alternative rates of payment.
Existing law provides for the Medi-Cal program, administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law requires the director of the department to establish and periodically review and revise the statewide Medi-Cal reimbursement rates for health care services. Under existing law, Medi-Cal reimbursement rates do not distinguish between services provided by a physician and services provided by a dentist.
This bill would require a health care service plan or health insurer to contract with its health care providers to reimburse, at a reasonable rate, their business expenses that are medically necessary to comply with a public health order to render treatment to patients, to protect health care workers, and to prevent the spread of diseases causing public health emergencies. The bill would require the State Department of Health Care Services to similarly reimburse a Medi-Cal provider after undertaking a process to set a reasonable rate in consultation with provider groups. Because a willful violation of the bill’s requirements relative to health care service plans would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2/3   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

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


SECTION 1.

 Section 1374.192 is added to the Health and Safety Code, to read:

1374.192.
 (a) Notwithstanding any other law, a health care service plan, including a specialized health care service plan and a health care service plan that issues, sells, renews, or offers a contract covering dental services, shall reimburse its contracting health care providers for business expenses that are medically necessary to comply with a public health order to render treatment to patients, to protect health care workers, and to prevent the spread of diseases causing public health emergencies, including COVID-19. These medically necessary business expenses include personal protective equipment, infection control supplies or materials, medical or diagnostic equipment including testing supplies, test processing, the cost of transporting specimens, information technology systems for tracking infections and processing testing, or other related information technology expenses. testing.
(b) (1) A health care service plan shall reimburse a contracting health care provider pursuant to subdivision (a) at a reasonable rate negotiated by the plan and provider. provider for the duration of the public health emergency, or until the contract is renegotiated. Reimbursement shall be based on the provider’s description of these services on the claim. The reimbursement rate paid to dental providers shall be comparable to the rate paid to other health care providers.
(2) A health care service plan may provide supplemental payments to a contracting health care provider to purchase personal protective equipment, infection control supplies or materials, testing supplies, test processing, test specimen transport, or other medical equipment.
(c) A change to a contract between a health care service plan and a health care provider that delegates financial risk for testing, including related items and services, related to a public health emergency declared pursuant to Section 8558 of the Government Code is a material change to the parties’ contract. A health care service plan shall not delegate the financial risk to a contracted health care provider for the cost of enrollee services provided under this section unless the parties have negotiated and agreed upon a new contract provision pursuant to Section 1375.7.
(d) The department shall ensure a health care service plan provides timely reimbursement to its contracting health care providers pursuant to subdivision (a). The department may adopt regulations to implement this section.
(e) For purposes of this section, “contracting health care provider” means a physician and surgeon, dentist, or doctor of podiatric medicine who is licensed by the state to deliver or furnish health care services, who owns or operates a practice, and who is contracted with the enrollee’s health care service plan.

SEC. 2.

 Section 10120.35 is added to the Insurance Code, to read:

10120.35.
 (a) Notwithstanding any other law, a health insurer, including a specialized health insurer and a health insurer that issues, sells, renews, or offers a contract covering dental services, shall reimburse its contracting health care providers for business expenses that are medically necessary to comply with a public health order to render treatment to patients, to protect health care workers, and to prevent the spread of diseases causing public health emergencies, including COVID-19. These medically necessary business expenses include personal protective equipment, infection control supplies or materials, medical or diagnostic equipment including testing supplies, test processing, the cost of transporting specimens, information technology systems for tracking infections and processing testing, or other related information technology expenses. testing.
(b) (1) A health insurer shall reimburse a contracting health care provider pursuant to subdivision (a) at a reasonable rate negotiated by the insurer and provider. provider for the duration of the public health emergency, or until the contract is renegotiated. Reimbursement shall be based on the provider’s description of these services on the claim. The reimbursement rate paid to dental providers shall be comparable to the rate paid to other health care providers.
(2) A health insurer may provide supplemental payments to a contracting health care provider to purchase personal protective equipment, infection control supplies or materials, testing supplies, test processing, test specimen transport, or other medical equipment.
(c) A change to a contract between a health insurer and a health care provider that delegates financial risk for testing, including related items and services, related to a public health emergency declared pursuant to Section 8558 of the Government Code is a material change to the parties’ contract. A health insurer shall not delegate the financial risk to a contracted health care provider for the cost of insured services provided under this section unless the parties have negotiated and agreed upon a new contract provision pursuant to Section 10133.65.
(d) The department shall ensure a health insurer provides timely reimbursement to its contracting health care providers pursuant to subdivision (a). The department may adopt regulations to implement this section.
(e) For purposes of this section, “contracting health care provider” means a physician and surgeon, dentist, or doctor of podiatric medicine who is licensed by the state to deliver or furnish health care services, who owns or operates a practice, and who is contracted with the insured’s health insurer.

SEC. 3.

 Section 14079.8 is added to the Welfare and Institutions Code, to read:

14079.8.
 (a) Notwithstanding any other law, the department shall reimburse physicians and dentists for business expenses that are medically necessary to render treatment to patients, to protect health care workers, and to comply with a public health order to prevent the spread of diseases causing public health emergencies, including COVID-19. These medically necessary business expenses include personal protective equipment, infection control supplies or materials, medical or diagnostic equipment including testing supplies, test processing, the cost of transporting specimens, information technology systems for tracking infections and processing testing, or other related information technology expenses.
(b) (1) The department shall undertake a process to set reimbursement pursuant to subdivision (a) at a reasonable rate after consultation with provider groups. The reimbursement rate paid to dentists shall be the same as the rate paid to physicians, pursuant to Section 14079.5.
(2) The department may provide supplemental payments to a physician or dentist to purchase personal protective equipment, infection control supplies or materials, testing supplies, test processing, test specimen transport, or other medical equipment.
(c) The department shall ensure that reimbursement pursuant to subdivision (a) is provided timely to physicians and dentists. The department may adopt regulations to implement this section.

SEC. 4.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SEC. 5.

 This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
To protect the health of frontline medical and dental personnel, which ensures the ongoing availability of medical and dental practices, thus safeguarding access to care, and due to the paradigm shift increasing the level of expectation of infection control protocols during, and likely following, the COVID-19 pandemic, it is necessary for this act to take effect immediately.