Bill Text: CA SB728 | 2011-2012 | Regular Session | Amended

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

---

Bill Title: Medi-Cal: durable medical equipment reimbursement.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2012-09-22 - Chaptered by Secretary of State. Chapter 451, Statutes of 2012. [SB728 Detail]

Download: California-2011-SB728-Amended.html

---

BILL NUMBER: SB 728	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 25, 2012
	AMENDED IN SENATE  MAY 31, 2011
	AMENDED IN SENATE  MARCH 25, 2011

INTRODUCED BY   Senator  Hernandez   Negrete
McLeod 

                        FEBRUARY 18, 2011

   An act to  add   amend  Section 
100522 to   14105.48 of  the  Government
  Welfare and Institutions  Code, relating to
 health care coverage  Medi-Cal  .


	LEGISLATIVE COUNSEL'S DIGEST


   SB 728, as amended,  Hernandez   Negrete
McLeod  .  Health care coverage.  
Medi-Cal: durable medical equipment reimbursement.  
   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 persons. The
Medi-Cal program is, in part, governed and funded by federal Medicaid
provisions. Existing law requires the department to establish a list
of covered services and maximum allowable reimbursement rates for
durable medical equipment, as defined. Existing law requires that
reimbursement for all durable medical equipment billed to the
Medi-Cal program using codes with no specified maximum allowable rate
be the lesser of certain amounts, including the manufacturer's
suggested retail price on June 1, 2006, as specified.  
   This bill would base this amount instead on the manufacturer's
suggested retail price on or prior to the date of service. 

   Existing law, the federal Patient Protection and Affordable Care
Act, requires each state to, by January 1, 2014, establish an
American Health Benefit Exchange that makes available qualified
health plans to qualified individuals and employers. Existing state
law establishes the California Health Benefit Exchange within state
government, specifies the powers and duties of the board governing
the Exchange relative to determining eligibility for enrollment in
the Exchange and arranging for coverage under qualified health plans,
and requires the board to facilitate the purchase of qualified
health plans through the Exchange by qualified individuals and small
employers by January 1, 2014.  
   The federal Patient Protection and Affordable Care Act also
requires that risk adjustments be made with regard to health insurers
and health plans providing coverage in the individual or small group
market within the state.  
   Existing law establishes the Office of Statewide Health Planning
and Development and sets forth its powers and duties with respect to
health facility construction, health policy and planning, and health
professions development.  
   This bill would require the board of the California Health Benefit
Exchange, to the extent required by federal law, to work with the
Office of Statewide Health Planning and Development, the Department
of Insurance, and the Department of Managed Health Care to develop a
risk adjustment system for products sold in the Exchange and outside
of the Exchange, as specified.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 14105.48 of the  
Welfare and Institutions Code   is amended to read: 
   14105.48.  (a) The department shall establish a list of covered
services and maximum allowable reimbursement rates for durable
medical equipment as defined in Section 51160 of Title 22 of the
California Code of Regulations and the list shall be published in
provider manuals. The list shall specify utilization controls to be
applied to each type of durable medical equipment.
   (b) Reimbursement for durable medical equipment, except
wheelchairs, wheelchair accessories, and speech-generating devices
and related accessories, shall be the lesser of (1) the amount billed
pursuant to Section 51008.1 of Title 22 of the California Code of
Regulations, (2) an amount that does not exceed 80 percent of the
lowest maximum allowance for California established by the federal
Medicare Program for the same or similar item or service, or (3) the
guaranteed acquisition cost negotiated by means of the contracting
process provided for pursuant to Section 14105.3 plus a percentage
markup to be established by the department.
   (c) Reimbursement for wheelchairs, wheelchair accessories, and
speech-generating devices and related accessories shall be the lesser
of (1) the amount billed pursuant to Section 51008.1 of Title 22 of
the California Code of Regulations, (2) an amount that does not
exceed 100 percent of the lowest maximum allowance for California
established by the federal Medicare Program for the same or similar
item or service, or (3) the guaranteed acquisition cost negotiated by
means of the contracting process provided for pursuant to Section
14105.3 plus a percentage markup to be established by the department.

   (d) Reimbursement for all durable medical equipment billed to the
Medi-Cal program utilizing codes with no specified maximum allowable
rate shall be the lesser of (1) the amount billed pursuant to Section
51008.1 of Title 22 of the California Code of Regulations, (2) the
guaranteed acquisition cost negotiated by means of the contracting
process provided for pursuant to Section 14105.3 plus a percentage
markup to be established by the department, (3) the actual
acquisition cost plus a markup to be established by the department,
(4) the manufacturer's suggested retail purchase price on 
June 1, 2006   or prior to the date of service  ,
and documented by a printed catalog or a hard copy of an electronic
catalog page showing  the   that  price
 on that date  , reduced by a percentage discount
not to exceed 20 percent, or not to exceed 15 percent for wheelchairs
and wheelchair accessories if the provider employs or contracts with
a qualified rehabilitation professional, as defined in paragraph (3)
of subdivision (c) of Section 14105.485, or (5) a price established
through targeted product-specific cost containment provisions
developed with providers.
   (e) Reimbursement for all durable medical equipment supplies and
accessories billed to the Medi-Cal program shall be the lesser of (1)
the amount billed pursuant to Section 51008.1 of Title 22 of the
California Code of Regulations, or (2) the acquisition cost plus a 23
percent markup.
   (f) Commencing January 1, 2007, reimbursement for oxygen delivery
systems and oxygen contents shall utilize national HCPCS codes, and
shall be the lesser of (1) the amount billed pursuant to Section
51008.1 of Title 22 of the California Code of Regulations, (2) an
amount that does not exceed 80 percent of the lowest maximum
allowance for California established by the federal Medicare Program
for the same or a similar item or service, or (3) the guaranteed
acquisition cost negotiated by means of the contracting process
provided for pursuant to Section 14105.3, plus a percentage markup to
be established by the department.
   (g) Within six months of the effective date of the act that added
this subdivision, the department shall review utilization of services
and equipment resulting from the changes to this section made by
that act, and shall assess whether the changes are contributing to
inappropriate use of those services or equipment. If the department's
review finds an increase in inappropriate use of those services or
equipment, the Department of Finance shall notify the Joint
Legislative Budget Committee of the State Department of Health
Services' findings and recommended changes to ensure program
integrity.
   (h) Any regulation in Division 3 of Title 22 of the California
Code of Regulations that contains provisions for reimbursement rates
for durable medical equipment shall be amended or repealed effective
for dates of service on or after the date of the act adding this
section.
   (i) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of the Government Code, actions under this
section shall not be subject to the Administrative Procedure Act or
to the review and approval of the Office of Administrative Law.
   (j) The department shall consult with interested parties and
appropriate stakeholders in implementing this section with respect to
all of the following:
   (1) Notifying the provider representatives of the proposed change.

   (2) Scheduling at least one meeting to discuss the change.
   (3) Allowing for written input regarding the change.
   (4) Providing advance notice on the implementation and effective
date of the change.
   (k) The department may require providers of durable medical
equipment to appeal Medicare denials for dually eligible
beneficiaries as a condition of Medi-Cal payment. 
  SECTION 1.    Section 100522 is added to the
Government Code, to read:
   100522.  (a) To the extent required by federal law, and in
conformance with Section 1343 of the federal act and any rules or
regulations issued under that section, the board shall collaborate
with the Office of Statewide Health Planning and Development, the
Department of Insurance, and the Department of Managed Health Care to
develop a risk adjustment system for products sold in the Exchange
and outside of the Exchange.
   (b) In developing the risk adjustment system, the board shall be
subject to the criteria and methods specified in Section 1343 of the
federal act. The board shall also consider various data collection
processes for purposes of the risk adjustment system.
   (c) "Risk adjustment" shall have the same meaning as described in
Section 1343 of the federal act.
   (d) No money from the General Fund shall be used for the purpose
of carrying out the provisions of this section.