Bill Text: CA SB335 | 2011-2012 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Medi-Cal: hospitals: quality assurance fee.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Passed) 2011-09-16 - Chaptered by Secretary of State. Chapter 286, Statutes of 2011. [SB335 Detail]

Download: California-2011-SB335-Amended.html

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BILL NUMBER: SB 335	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 26, 2011

INTRODUCED BY   Senators Hernandez and Steinberg

                        FEBRUARY 15, 2011

   An act  to amend Section 14166.115 of the Welfare and
Institutions Code,   relating to Medi-Cal, and declaring the
urgency thereof, to take effect immediately.


	LEGISLATIVE COUNSEL'S DIGEST

F   SB 335, as amended, Hernandez. Medi-Cal: hospitals: quality
assurance fee.
   Existing law establishes the Medi-Cal program, administered by the
State Department of Health Care Services, under which basic health
care services are provided to qualified low-income individuals. The
Medi-Cal program is, in part, governed and funded by federal Medicaid
Program provisions. Existing law, subject to federal approval,
imposes a quality assurance fee, as specified, on certain general
acute care hospitals through and including  December 31, 2010
  June 30, 2011  . Existing law creates the
Hospital Quality Assurance Revenue Fund in the State Treasury and
requires that the money collected from the quality assurance fee be
deposited into the fund. Existing law, subject to federal approval,
requires the department to make supplemental payments for certain
services, as specified, to private hospitals  , nondesignated
public hospitals, and designated public hospitals, as defined, for
subject fiscal years, as defined   increased capitation
payments to Medi-Cal managed health care plans, and increased
payments to mental health plans  . Existing law provides that
the moneys in the Hospital Quality Assurance Revenue Fund shall, upon
appropriation by the Legislature, be available only for certain
purposes, including  paying for health care coverage for
children, as specified, and  making  these 
 the  supplemental payments to hospitals  , increased
capitation payments to Medi-Cal managed health care plans, and
increased payments to mental health plans  .
   This bill would provide that it is the intent of the Legislature
to consider legislation that would impose a quality assurance fee to
be paid by hospitals, for the period of July 1, 2011, through June
30, 2012, which would be used to increase federal financial
participation in order to make supplemental Medi-Cal payments to
hospitals and pay for health care coverage for children, as
specified. This bill would provide that it is the intent of the
Legislature that the quality assurance fee be implemented only if
specified conditions are met. 
   Existing law requires the department to seek a demonstration
project or federal waiver of Medicaid law to implement specified
objectives, which may include better care coordination for seniors,
persons with disabilities, and children with special health care
needs. Existing law provides that to the extent the provisions under
the Medi-Cal Hospital/Uninsured Care Demonstration Project Act do not
conflict with the provisions of, or the Special Terms and Conditions
of, this demonstration project, the provisions of the Medi-Cal
Hospital/Uninsured Care Demonstration Project Act shall apply. Under
existing law, the department is required to reduce disproportionate
share hospital replacement payments to private hospitals by 10% for
the 2009-10 fiscal year, as specified. Existing law also provides
that, in addition to the 10% reduction, disproportionate share
hospital replacement payments to private hospitals shall be reduced
in the 2010-11 fiscal year by an additional $30 million in General
Fund moneys and by the corresponding federal financial participation,
and in the 2011-12 fiscal year by an additional $75 million in
General Fund moneys and by the corresponding federal financial
participation. Existing law provides that the additional room under
the federal upper payment limit created by these reductions shall be
used for specified purposes.  
   This bill would, in relation to the 2010-11 and 2011-12 fiscal
year reductions, delete the requirement that the reductions be in
addition to the 10% reduction for the 2009-10 fiscal year. 
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
F  SECTION 1.  The Legislature finds and declares both of the
following:
   (a) The Legislature continues to recognize the essential role that
hospitals play in serving the state's Medi-Cal beneficiaries. To
that end, it has been, and remains, the intent of the Legislature to
preserve funding for hospitals and to obtain all available federal
funds to make supplemental Medi-Cal payments to hospitals.
   (b) It is the intent of the Legislature that funding provided to
hospitals through a hospital quality assurance fee be explored with
the goal of increasing access to care and stabilizing hospital rates
through supplemental Medi-Cal payments to hospitals.
  SEC. 2.  (a) It is the intent of the Legislature to consider
legislation that would impose a quality assurance fee to be paid by
hospitals, which would be used to increase federal financial
participation in order to do both of the following:
   (1) Make supplemental Medi-Cal payments to hospitals for the
period of July 1, 2011, through June 30, 2012.
   (2) Pay for health care coverage for children in the amount of
 forty million dollars ($40,000,000)   eighty
  million dollars ($80,000,000)  for each quarter in
which supplemental Medi-Cal payments are made to hospitals.
   (b) It is the intent of the Legislature to consider legislation
that would require the State Department of Health Care Services to
obtain the necessary federal approvals to implement the quality
assurance fee described in subdivision (a) in order to make
supplemental Medi-Cal payments to hospitals for the period of July 1,
F2011, through June 30, 2012.   (c) It is the intent of the Legislature to consider legislation
that would require the quality assurance fee be implemented only if
all of the following conditions are met:
   (1) The quality assurance fee is established in consultation with
the hospital community.
   (2) The quality assurance fee, including any interest earned after
collection by the department, is deposited in a segregated fund
apart from the General Fund and used exclusively for supplemental
Medi-Cal payments to hospitals and for the direct costs of
administering the program by the State Department of Health Care
Services.
   (3) No hospital shall be required to pay the quality assurance fee
to the department unless and until the state receives and maintains
federal approval of the quality assurance fee and related
supplemental payments to hospitals.
   (4) The full amount of the quality assurance fee assessed and
collected remains available only for the purposes specified by the
Legislature.
   SEC. 3.    Section 14166.115 of the  
Welfare and Institutions Code   is amended to read: 
   14166.115.  (a) Due to the state budget deficit and in order to
implement changes in the level of funding for health care services,
the department shall reduce disproportionate share hospital
replacement payments to private hospitals made pursuant to Section
14166.11 as specified in this section.
   (b) (1) Disproportionate share hospital replacement payments to
private hospitals pursuant to Section 14166.11 shall be reduced by 10
percent. The reductions shall be applied to all disproportionate
share hospital replacement payments to private hospitals made for the
2009-10 fiscal year, including, but not limited to, interim
payments, tentative adjusted monthly payments, data corrected
payments, and the final adjusted payment.
   (2)  In addition to the reduction provided for in
paragraph (1), disproportionate   Disproportionate 
  share hospital replacement payments to private hospitals
pursuant to Section 14166.11 shall be reduced in the 2010-11 fiscal
year by  an additional  thirty million dollars
($30,000,000) in General Fund moneys and by the corresponding federal
financial participation. To the extent permitted by federal law, the
additional room created by this paragraph under the federal upper
payment limit shall be used to increase supplemental payments under
Article 5.226 (commencing with Section 14168.1) and Article 5.227
(commencing with Section 14168.31).
   (3)  In addition to the reduction provided for in
paragraph (1), disproportionate   Disproportionate 
share hospital replacement payments to private hospitals pursuant to
Section 14166.11 shall be reduced in the 2011-12 fiscal year by
 an additional  seventy-five million dollars
($75,000,000) in General Fund moneys and by the corresponding federal
financial participation. To the extent permitted by federal law, the
additional room created by this paragraph under the federal upper
payment limit shall be used to increase supplemental payments under
subsequent legislation extending or creating a new supplemental
hospital payment program supported by a fee.
   (c) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement and administer this section by means of
provider bulletins, or similar instructions, without taking further
regulatory action.
   (d) The reductions described in this section shall apply only to
payments for services when the General Fund share of the payment is
paid with funds appropriated to the department in the annual Budget
Act.
   (e) The department shall promptly seek any necessary federal
approvals for the implementation of this section.
   SEC. 3.   SEC. 4.   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 Constitution and shall go into immediate effect. The facts
constituting the necessity are:
   In order to make the necessary statutory changes to increase
Medi-Cal payments to hospitals and improve access at the earliest
possible time, so as to allow this act to be operative as soon as
approval from the federal Centers for Medicare and Medicaid Services
is obtained by the State Department of Health Care Services, it is
necessary that this act take effect immediately.