Bill Text: CA SB964 | 2013-2014 | Regular Session | Amended

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

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Bill Title: Health care coverage.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2014-09-25 - Chaptered by Secretary of State. Chapter 573, Statutes of 2014. [SB964 Detail]

Download: California-2013-SB964-Amended.html

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BILL NUMBER: SB 964	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JULY 1, 2014
	AMENDED IN SENATE  APRIL 9, 2014

INTRODUCED BY   Senator Hernandez

                        FEBRUARY 10, 2014

   An act to amend Section 1367.03 of, to add Sections 1380.4,
1380.5, 1380.6, and 1380.7 to, and to repeal Section 1380.3 of, the
Health and Safety Code, and to  amend Section 14087.95 of
  add Section 14456.3 to  the Welfare and
Institutions Code, relating to health care coverage.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 964, as amended, Hernandez.  Health care service plans:
timeliness standards: medical surveys.   Health care
coverage.  
   Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Care Services, under
which qualified low-income individuals receive health care services.
One of the methods by which Medi-Cal services are provided is
pursuant to contracts with various types of managed health care
plans, including through county organized health systems. Existing
law specifies that these county organized health systems are exempt
from the Knox-Keene Health Care Service Plan Act of 1975. 
   Existing law, the Knox-Keene Health Care Service Plan Act of 1975
(Knox-Keene Act), 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 requires
the department to adopt standards for timeliness of access to care
and requires that contracts between health care service plans and
providers ensure compliance with those standards. Existing law
requires health care service plans to annually report to the
department on compliance with those standards in a manner specified
by the department. Under existing law, every 3 years, the department
is required to review information regarding compliance with those
standards and make recommendations for changes that further protect
enrollees. 
   This bill would eliminate the requirement that the department make
recommendations for changes that further protect enrollees, would
require the department to review information regarding compliance
with the timeliness standards, including any waivers or alternative
standards granted to plans, on an annual basis, and would require the
department to annually post its findings from that review on its
Internet Web site commencing December 1, 2016. The bill would require
health care service plans, in making reports to the department on
compliance with the timeliness standards, to use standardized survey
methodology if developed by the department. The bill would also
require a contract between a county organized health systems
established under the Medi-Cal program and a provider to ensure
compliance with the timeliness standards adopted by the department
and would require the county organized health system to annually
report to the department on compliance with those standards. By
expanding the scope of a crime and imposing a new duty on counties,
the bill would impose a state-mandated local program.  
   This bill would instead require the department to conduct that
review annually. The bill would also require health care service
plans, in making reports to the department on compliance with the
timeliness standards, to use standardized survey methodology if
developed by the department. Because a violation of that requirement
would be a crime, the bill would impose a state-mandated local
program. 
    Existing   law provides for the Medi-Cal program,
which is administered by the State Department of Health Care
Services, under which qualified low-income individuals receive health
care services. One of t   he methods by which Medi-Cal
services are provided is pursuant to contracts with various types of
managed health care plans.  Existing law establishes the
California Health Benefit Exchange for the purpose of facilitating
the enrollment of qualified individuals and small employers in
qualified health plans. The Knox-Keene Act requires the department to
periodically conduct an onsite medical survey of the health delivery
system of each health care service plan and exempts a plan that
provides services solely to Medi-Cal beneficiaries from the survey
upon submission to the department the medical survey audit conducted
by the State Department of Health Care Services as part of the
Medi-Cal contracting process.
   This bill would eliminate that exemption, would require a plan
that provides services to Medi-Cal beneficiaries and a plan that
provides services to enrollees in the California Health Benefit
Exchange to be surveyed by those product lines distinct from other
product lines and to be annually reviewed with respect to those
product lines for compliance with accessibility and availability of
services, continuity of care, and quality management, as specified.
The bill would also require a plan that provides services to Medi-Cal
beneficiaries through specified programs to be surveyed annually
with respect to the populations enrolled in those products until 5
years after completion of initial enrollment in those products, as
specified. The bill would  authorize   require
 the department to coordinate these surveys and reviews
conducted with respect to Medi-Cal managed care plans with the State
Department of Health Care Services, provided that the coordination
does not result in a delay of the surveys or reviews or the failure
of the department to conduct the surveys or reviews. 
   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 with regard to certain mandates no
reimbursement is required by this act for a specified reason.
 
   With regard to any other mandates, this bill would provide that,
if the Commission on State Mandates determines that the bill contains
costs so mandated by the state, reimbursement for those costs shall
be made pursuant to the statutory provisions noted above. 

   This bill would also require the State Department of Health Care
Services to post its medical survey audit findings of Medi-Cal
managed care plans on its Internet Web site and to share those
findings and other information with respect to Knox-Keene plans with
the Department of Managed Health Care.  
   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. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


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

  SECTION 1.  Section 1367.03 of the Health and Safety Code is
amended to read:
   1367.03.  (a) Not later than January 1, 2004, the department shall
develop and adopt regulations to ensure that enrollees have access
to needed health care services in a timely manner. In developing
these regulations, the department shall develop indicators of
timeliness of access to care and, in so doing, shall consider the
following as indicators of timeliness of access to care:
   (1) Waiting times for appointments with physicians, including
primary care and specialty physicians.
   (2) Timeliness of care in an episode of illness, including the
timeliness of referrals and obtaining other services, if needed.
   (3) Waiting time to speak to a physician, registered nurse, or
other qualified health professional acting within his or her scope of
practice who is trained to screen or triage an enrollee who may need
care.
   (b) In developing these standards for timeliness of access, the
department shall consider the following:
   (1) Clinical appropriateness.
   (2) The nature of the specialty.
   (3) The urgency of care.
   (4) The requirements of other provisions of law, including Section
1367.01 governing utilization review, that may affect timeliness of
access.
   (c) The department may adopt standards other than the time elapsed
between the time an enrollee seeks health care and obtains care. If
the department chooses a standard other than the time elapsed between
the time an enrollee first seeks health care and obtains it, the
department shall demonstrate why that standard is more appropriate.
In developing these standards, the department shall consider the
nature of the plan network.
   (d) The department shall review and adopt standards, as needed,
concerning the availability of primary care physicians, specialty
physicians, hospital care, and other health care, so that consumers
have timely access to care. In so doing, the department shall
consider the nature of physician practices, including individual and
group practices as well as the nature of the plan network. The
department shall also consider various circumstances affecting the
delivery of care, including urgent care, care provided on the same
day, and requests for specific providers. If the department finds
that health care service plans and health care providers have
difficulty meeting these standards, the department may make
recommendations to the Assembly Committee on Health and the Senate
Committee on Insurance of the Legislature pursuant to subdivision
(i).
   (e) In developing standards under subdivision (a), the department
shall consider requirements under federal law, requirements under
other state programs, standards adopted by other states, nationally
recognized accrediting organizations, and professional associations.
The department shall further consider the needs of rural areas,
specifically those in which health facilities are more than 30 miles
apart and any requirements imposed by the State Department of Health
Care Services on health care service plans that contract with the
State Department of Health Care Services to provide Medi-Cal managed
care.
   (f) (1) Contracts between health care service plans and health
care providers shall ensure compliance with the standards developed
under this section. These contracts shall require reporting by health
care providers to health care service plans and by health care
service plans to the department to ensure compliance with the
standards.
   (2) Health care service plans shall report annually to the
department on compliance with the standards in a manner specified by
the department. The reported information shall allow consumers to
compare the performance of plans and their contracting providers in
complying with the standards, as well as changes in the compliance of
plans with these standards.
   (3) In making reports to the department pursuant to this
subdivision, health care service plans shall use standardized survey
methodology if developed by the department.
   (g) (1) When evaluating compliance with the standards, the
department shall focus more upon patterns of noncompliance rather
than isolated episodes of noncompliance.
   (2) The director may investigate and take enforcement action
against plans regarding noncompliance with the requirements of this
section. Where substantial harm to an enrollee has occurred as a
result of plan noncompliance, the director may, by order, assess
administrative penalties subject to appropriate notice of, and the
opportunity for, a hearing in accordance with Section 1397. The plan
may provide to the director, and the director may consider,
information regarding the plan's overall compliance with the
requirements of this section. The administrative penalties shall not
be deemed an exclusive remedy available to the director. These
penalties shall be paid to the Managed Care Administrative Fines and
Penalties Fund and shall be used for the purposes specified in
Section 1341.45. The director shall periodically evaluate grievances
to determine if any audit, investigative, or enforcement actions
should be undertaken by the department.
   (3) The director may, after appropriate notice and opportunity for
hearing in accordance with Section 1397, by order, assess
administrative penalties if the director determines that a health
care service plan has knowingly committed, or has performed with a
frequency that indicates a general business practice, either of the
following:
   (A) Repeated failure to act promptly and reasonably to assure
timely access to care consistent with this chapter.
   (B) Repeated failure to act promptly and reasonably to require
contracting providers to assure timely access that the plan is
required to perform under this chapter and that have been delegated
by the plan to the contracting provider when the obligation of the
plan to the enrollee or subscriber is reasonably clear.
   (C) The administrative penalties available to the director
pursuant to this section are not exclusive, and may be sought and
employed in any combination with civil, criminal, and other
administrative remedies deemed warranted by the director to enforce
this chapter.
   (4) The administrative penalties shall be paid to the Managed Care
Administrative Fines and Penalties Fund and shall be used for the
purposes specified in Section 1341.45.
   (h) The department shall work with the patient advocate to assure
that the quality of care report card incorporates information
provided pursuant to subdivision (f) regarding the degree to which
health care service plans and health care providers comply with the
requirements for timely access to care.
   (i) The department shall annually review information regarding
compliance with the standards developed under this section  ,
including any waivers or alternative standards granted to a plan
pursuant to this section. By December 1, 2016, and annually
thereafter, the department shall post its findings from that review
on its Internet Web site   and shall make
recommendations for changes that further protect enrollees  .
  SEC. 2.  Section 1380.3 of the Health and Safety Code is repealed.
  SEC. 3.  Section 1380.4 is added to the Health and Safety Code, to
read:
   1380.4.  A plan that provides services to Medi-Cal beneficiaries
pursuant to Chapter 8 (commencing with Section 14200) of Part 3 of
Division 9 of the Welfare and Institutions Code shall do both of the
following:
   (a) Be surveyed under Section 1380 by its Medi-Cal managed care
product  line   lines  distinct from its
other product lines, if any, in order to determine whether the
services received by Medi-Cal beneficiaries comply with the
requirements of this chapter.
   (b)  (1)    Be annually reviewed, with respect
to its Medi-Cal managed care product lines, for compliance with all
of the following: 
   (1) 
    (A)  Accessibility and availability of services,
including network adequacy and timely access to care. 
   (2) 
    (B)  Continuity of care. 
   (3) 
    (C)  Quality  management, including precautions
to ensure that appropriate care is not withheld or delayed for any
reason.   management.  
   (2) This subdivision shall not be construed to require an onsite
survey in addition to the survey required by Section 1380.  

   (3) The department may conduct the annual review required by this
subdivision through telephonic or other means and is not required to
perform the review onsite, unless the director determines that an
onsite review is necessary.  
   (4) In conducting the annual review required by this subdivision,
the department shall maximize the use of all relevant existing
reports and information already submitted to the department by the
plan and, if applicable, the outcomes of medical survey audits and
monthly provider files provided to the department by the Department
of Health Care Services pursuant to Section 14456.3 of the Welfare
and Institutions Code. This paragraph shall not limit the authority
of the department to request additional information from the plan as
deemed necessary to carry out and complete the annual review required
by this subdivision and any enforcement action initiated as a result
of the review. 
  SEC. 4.  Section 1380.5 is added to the Health and Safety Code, to
read:
   1380.5.  (a) A plan that provides services to enrollees in the
California Health Benefit Exchange pursuant to Title 22 (commencing
with Section 100500) of the Government Code shall do both of the
following:
   (1) Be surveyed under Section 1380 by its product  line
  lines  sold through the Exchange distinct from
its product  line   lines  sold outside the
Exchange, if any, in order to determine whether the services
received by the Exchange enrollees comply with the requirements of
this chapter.
   (2)  (A)    Be annually reviewed, with respect
to its product  line   lines  sold through
the Exchange, for compliance with all of the following: 
   (A) 
    (i)  Accessibility and availability of services,
including network adequacy and timely access to care. 
   (B) 
    (ii)  Continuity of care. 
   (C) 
    (iii)  Quality  management, including
precautions to ensure that appropriate care is not withheld or
delayed for any reason.   management.  
   (B) This paragraph shall not be construed to require an onsite
survey in addition to the survey required by Section 1380.  

   (C) The department may conduct the annual review required by this
paragraph through telephonic or other means and is not required to
perform the review onsite, unless the director determines that an
onsite review is necessary.  
   (D) In conducting the annual review required by this paragraph,
the department shall maximize the use of all relevant existing
reports and information already submitted to the department by the
plan and, if applicable, the outcomes of medical survey audits and
monthly provider files provided to the department by the Department
of Health Care Services pursuant to Section 14456.3 of the Welfare
and Institutions Code. This subparagraph shall not limit the
authority of the department to request additional information from
the plan as deemed necessary to carry out and complete the annual
review required by this paragraph and any enforcement action
initiated as a result of the review. 
   (b) This section shall not apply to either of the following:
   (1) A plan that uses the same network for its product 
line   lines  sold  in the individual and s
  mall group markets  through the Exchange as the
network used for its product  line   lines 
sold  in the individual and small group markets  outside
the Exchange.
   (2) A plan that uses the same network for its product 
line   lines  sold through the Exchange as the
network used for its Medi-Cal managed care product  line
  lines  .
  SEC. 5.  Section 1380.6 is added to the Health and Safety Code, to
read:
   1380.6.  A plan that enrolls Medi-Cal beneficiaries as a result of
any of the following shall be surveyed annually under Section 1380
with respect to the populations enrolled in those products until five
years after the completion of initial enrollment under those
products:
   (a) The transition of Healthy Families Program enrollees to the
Medi-Cal program pursuant to Chapter 16.2 (commencing with Section
12694.1) of Part 6.2 of Division 2 of the Insurance Code.
   (b) Article 2.82 (commencing with Section 14087.98) of Chapter 7
of Part 3 of Division 9 of the Welfare and Institutions Code.
   (c) Section 14182 of the Welfare and Institutions Code.
   (d) Sections 14182.16 and 14182.17, or Section 14132.275, of the
Welfare and Institutions Code.
  SEC. 6.  Section 1380.7 is added to the Health and Safety Code, to
read:
   1380.7.  The department  may   shall 
coordinate the surveys and reviews conducted pursuant to Sections
1380.4 and 1380.6 with the State Department of Health Care Services
in order to allow for simultaneous oversight of Medi-Cal managed care
plans by both departments, provided that this coordination does not
result in a delay of the surveys or reviews required under Sections
1380.4 and 1380.6 or in the failure of the department to conduct
those surveys or reviews. 
  SEC. 7.    Section 14087.95 of the Welfare and
Institutions Code is amended to read:
   14087.95.  (a) Counties contracting with the department pursuant
to this article shall be exempt from the provisions of Chapter 2.2
(commencing with Section 1340) of Division 2 of the Health and Safety
Code for purposes of carrying out the contracts.
   (b) Notwithstanding subdivision (a), a county contracting with the
department pursuant to this article shall, for purposes of carrying
out that contract, be treated as a health care service plan under,
and comply with, subdivision (f) of Section 1367.03 of the Health and
Safety Code.  
  SEC. 8.    No reimbursement is required by this
act pursuant to Section 6 of Article XIII B of the California
Constitution for certain costs that may be incurred by a local agency
or school district because, in that regard, 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.
   However, if the Commission on State Mandates determines that this
act contains other costs mandated by the state, reimbursement to
local agencies and school districts for those costs shall be made
pursuant to Part 7 (commencing with Section 17500) of Division 4 of
Title 2 of the Government Code. 
   SEC. 7.    Section 14456.3 is added to the  
Welfare and Institutions Code   , to read:  
   14456.3.  (a) The department shall share with the Department of
Managed Health Care its findings from medical survey audits and
monthly provider files of a Medi-Cal managed care plan that provides
services to Medi-Cal beneficiaries pursuant to Chapter 7 (commencing
with Section 14000) or this chapter and is subject to Chapter 2.2
(commencing with Section 1340) of Division 2 of the Health and Safety
Code.
   (b) The department shall post on its Internet Web site its
findings from medical survey audits of a Medi-Cal managed care plan
that provides services to Medi-Cal beneficiaries pursuant to Chapter
7 (commencing with Section 14000) or this chapter. 
   SEC. 8.    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.