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AB-1174 Health care: anesthesia services.(2019-2020)

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Date Published: 03/25/2019 09:00 PM
AB1174:v98#DOCUMENT

Amended  IN  Assembly  March 25, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 1174


Introduced by Assembly Member Wood

February 21, 2019


An act to add Sections 1341.46 and 1371.32 to the Health and Safety Code, and to add Section 10112.83 to the Insurance Code, relating to health care.


LEGISLATIVE COUNSEL'S DIGEST


AB 1174, as amended, Wood. Health care: anesthesia services.
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 requires a health care service plan contract or policy of health insurance to cover services provided at an in-network health facility by a noncontracting health professional with the same cost sharing as if the services were provided by a contracting health professional. Existing law creates the Managed Care Administrative Fines and Penalties Fund, into which certain health care service plans’ fines and penalties are deposited.
This bill would require a health care service plan, its delegated entity, or a health insurer to notify the Department of Managed Health Care or the Insurance Commissioner before the expiration or plan-, entity-, or insurer-initiated termination of a contract pursuant to which anesthesia services are provided. The bill would require the Department of Managed Health Care or the Insurance Commissioner to issue a finding that, at the expiration or termination of an anesthesia services contract initiated by a health care service plan, its delegated entity, or a health insurer, contracts are required to be in place with anesthesiologists individual health professionals who are licensed by the state to deliver or furnish anesthesia services so that specified requirements are met.
This bill would authorize the Director of the Department of Managed Health Care or the Insurance Commissioner to assess an administrative penalty by order, after appropriate notice and opportunity for hearing, if the director or commissioner determines that a health care service plan, its delegated entity, or a health insurer has failed to comply with a finding. The bill would create the Managed Care Penalty Account, within the Managed Care Administrative Fines and Penalties Fund, which would be subject to appropriation by the Legislature, and into which administrative penalties for a health care service plan’s noncompliance would be deposited. The bill would specify that administrative penalties assessed against a health insurer be deposited into the Insurance Fund. 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.
Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.
This bill would make legislative findings to that effect.
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   Local Program: YES  

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


SECTION 1.

 Section 1341.46 is added to the Health and Safety Code, to read:

1341.46.
 (a) There is hereby created the Managed Care Penalty Account within the Managed Care Administrative Fines and Penalties Fund.
(b) Moneys in the Managed Care Penalty Account shall be subject to appropriation by the Legislature.
(c) Notwithstanding Section 1341.45, fines and administrative penalties collected pursuant to this chapter shall be deposited into the Managed Care Penalty Account.

SEC. 2.

 Section 1371.32 is added to the Health and Safety Code, to read:

1371.32.
 (a) The Legislature finds and declares the following:
(1) The relationships between facility-based anesthesiologists, individual health professionals who are licensed by the state to deliver or furnish anesthesia services, health care service plans, delegated entities, health facilities, and health care service plan enrollees are especially complex due to the nature of the health care services provided and the contracting relationships between the stakeholders.
(2) Health care service plans and delegated entities must maintain robust networks of physicians, including facility-based specialists, to ensure timely, high-quality patient care and to ensure the safety of enrollees.
(b) (1) A health care service plan shall notify the department before the expiration or health care service plan-initiated termination of a contract pursuant to which anesthesia services are provided.
(2) Upon receiving notification pursuant to paragraph (1), the department shall issue a finding that, at the expiration or health care service plan-initiated termination of the contract, the health care service plan shall have in place contracts with anesthesiologists individual health professionals who are licensed by the state to deliver or furnish anesthesia services so that both of the following requirements are met:
(A) For each health facility with which the health care service plan has a contract, the health care service plan shall also have a contract with at least one anesthesiologist individual health professional who is licensed by the state to deliver or furnish anesthesia services and who is contracted with the health facility.
(B) A health care service plan enrollee requiring anesthesia services shall have access to a contracted anesthesiologist individual health professional who is licensed by the state to deliver or furnish anesthesia services at all times and for all procedures at each of the health care service plan’s contracted health facilities.
(3) If a health care service plan does not comply with a finding issued pursuant to paragraph (2), the expiration or health care service plan-initiated termination of a contract pursuant to which anesthesia services are provided shall constitute grounds for disciplinary action against the health care service plan, and the director shall, after appropriate notice and opportunity for hearing in accordance with the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), assess an administrative penalty by order.
(c) (1) A contract issued, amended, or renewed on or after January 1, 2020, between a health care service plan and its delegated entity shall require the delegated entity to notify the health care service plan before the expiration or delegated entity-initiated termination of a contract pursuant to which anesthesia services are provided to enrollees of the health care service plan.
(2) Upon receiving notification from a delegated entity pursuant to paragraph (1), a health care service plan shall notify the department.
(3) Upon receiving notification pursuant to paragraph (2), the department shall issue a finding that, at the expiration or delegated entity-initiated termination of the contract, the delegated entity shall have in place contracts with anesthesiologists individual health professionals who are licensed by the state to deliver or furnish anesthesia services so that both of the following requirements are met:
(A) For each health care facility with which the delegated entity has a contract to provide services to enrollees of the health care service plan, the delegated entity shall have a contract with at least one anesthesiologist individual health professional who is licensed by the state to deliver or furnish anesthesia services and who is contracted with the health facility.
(B) A health care service plan enrollee assigned to the delegated entity and requiring anesthesia services shall have access to a contracted anesthesiologist individual health professional who is licensed by the state to deliver or furnish anesthesia services at all times and for all procedures at each of the delegated entity’s contracted health facilities.
(4) If a delegated entity does not comply with a finding issued pursuant to paragraph (3), the expiration or delegated entity-initiated termination of a contract pursuant to which anesthesia services are provided shall constitute grounds for disciplinary action against the health care service plan, and the director shall, after appropriate notice and opportunity for hearing in accordance with the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), assess an administrative penalty by order.
(d) (1) A finding by the department made pursuant to this section does not satisfy the requirements of Section 1367.03 or its implementing regulations.
(2) This section does not limit the director’s authority to enforce standards established by or pursuant to Section 1367.03, or to develop additional standards pursuant to Section 1367.03.
(e) (1) Information submitted to the department pursuant to this section shall be confidential and shall not be subject to disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(2) Findings issued and disciplinary actions taken by the department pursuant to this section shall be subject to disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(f) Notwithstanding Section 1341.45, an administrative penalty collected pursuant to this section shall be deposited into the Managed Care Penalty Account.
(g) As used in this section:
(1) “Anesthesia services” means the services listed in the Current Procedural Terminology code section entitled “Anesthesia.”
(2) “Health facility” includes the following providers:
(A) A licensed hospital.
(B) An ambulatory surgery center or other outpatient setting, as described in subdivision (a), (d), (e), (g), or (h) of Section 1248.1.
(h) This section does not apply to a Medi-Cal managed care plan or any entity that enters into a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000) of, Chapter 8 (commencing with Section 14200) of, or Chapter 8.75 (commencing with Section 14591) of, Part 3 of Division 9 of the Welfare and Institutions Code.

SEC. 3.

 Section 10112.83 is added to the Insurance Code, to read:

10112.83.
 (a) The Legislature finds and declares the following:
(1) The relationships between facility-based anesthesiologists, individual health professionals who are licensed by the state to deliver or furnish anesthesia services, health insurers, health facilities, and insureds are especially complex due to the nature of the health care services provided and the contracting relationships between the stakeholders.
(2) Health insurers must maintain robust networks of physicians, including facility-based specialists, to ensure timely, high-quality patient care and to ensure the safety of insureds.
(b) (1) A health insurer shall notify the commissioner before the expiration or health insurer-initiated termination of a contract pursuant to which anesthesia services are provided at an alternative rate of payment pursuant to Section 10133.
(2) Upon receiving notification pursuant to paragraph (1), the commissioner shall issue a finding that, at the expiration or health insurer-initiated termination of the contract, the health insurer shall have in place contracts with anesthesiologists individual health professionals who are licensed by the state to deliver or furnish anesthesia services at an alternative rate of payment pursuant to Section 10133 so that both of the following requirements are met:
(A) For each health facility with which the health insurer contracts at an alternative rate of payment pursuant to Section 10133, the health insurer shall also have a contract at an alternative rate of payment pursuant to Section 10133 with at least one anesthesiologist individual health professional who is licensed by the state to deliver or furnish anesthesia services and who is contracted with the health facility.
(B) An insured requiring anesthesia services shall have access to a contracted anesthesiologist individual health professional who is licensed by the state to deliver or furnish anesthesia services at all times and for all procedures at each of the health facilities with which the health insurer contracts at an alternative rate of payment pursuant to Section 10133.
(3) If a health insurer does not comply with a finding issued pursuant to paragraph (2), the expiration or health insurer-initiated termination of a contract pursuant to which anesthesia services are provided at an alternative rate of payment pursuant to Section 10133 shall constitute grounds for disciplinary action against the health insurer, and the commissioner shall, after appropriate notice and opportunity for hearing in accordance with the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), assess an administrative penalty by order. An administrative penalty collected pursuant to this paragraph shall be deposited into the Insurance Fund.
(c) (1) A finding by the commissioner made pursuant to this section does not satisfy the requirements of Section 10133.5 or its implementing regulations.
(2) This section does not limit the commissioner’s authority to enforce standards established by or pursuant to Section 10133.5, or to develop additional standards pursuant to Section 10133.5.
(d) (1) Information submitted to the commissioner pursuant to this section shall be confidential and shall not be subject to disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(2) Findings issued and disciplinary actions taken by the commissioner pursuant to this section shall be subject to disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(e) As used in this section:
(1) “Anesthesia services” means the services listed in the Current Procedural Terminology code section entitled “Anesthesia.”
(2) “Health facility” includes the following providers:
(A) A licensed hospital.
(B) An ambulatory surgery center or other outpatient setting, as described in subdivision (a), (d), (e), (g), or (h) of Section 1248.1 of the Health and Safety Code.

SEC. 4.

 The Legislature finds and declares that Sections 2 and 3 of this act, which add Section 1371.32 to the Health and Safety Code and Section 10112.83 to the Insurance Code, impose a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:
In order to protect confidential and proprietary information submitted to the Department of Managed Health Care and the Insurance Commissioner, it is necessary for that information to remain confidential.

SEC. 5.

 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.