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AB-1278 Physicians and surgeons: payments: disclosure: notice.(2021-2022)

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Date Published: 02/19/2021 09:00 PM
AB1278:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 1278


Introduced by Assembly Member Nazarian

February 19, 2021


An act to add Article 6.5 (commencing with Section 660) to Chapter 1 of Division 2 of the Business and Professions Code, relating to healing arts.


LEGISLATIVE COUNSEL'S DIGEST


AB 1278, as introduced, Nazarian. Physicians and surgeons: payments: disclosure: notice.
Existing law, the Medical Practice Act, establishes the Medical Board of California within the Department of Consumer Affairs and sets forth its powers and duties relating to the licensure and regulation of physicians and surgeons. Existing law establishes the Osteopathic Medical Board of California within the department and sets forth its powers and duties relating to the licensure and regulation of osteopathic physicians and surgeons.
Under existing law, it is unlawful for healing arts licensees, except as specified, to offer, deliver, receive, or accept any rebate, refund, commission, preference, patronage dividend, discount, or other consideration, in the form of money or otherwise, as compensation or inducement for referring patients, clients, or customers to any person, subject to certain exceptions. Existing law also prohibits specified healing arts licensees from charging, billing, or otherwise soliciting payment from a patient on behalf of, or referring a patient to, an organization in which the licensee, or the licensee’s immediate family, has a significant beneficial interest, unless the licensee first makes specified disclosures in writing to the patient.
Existing federal law known as the Open Payments program requires, among other things, applicable manufacturers of drugs, devices, and biological or medical supplies to annually report to the federal Secretary of Health and Human Services certain payments and other transfers of value made to covered recipients, as defined.
This bill would require a physician and surgeon, defined to include a physician and surgeon licensed pursuant to the Medical Practice Act or an osteopathic physician and surgeon licensed by the Osteopathic Medical Board of California under the Osteopathic Act, who receives remuneration from a drug or device company, to disclose the source of the remuneration orally and in writing to each patient prior to the intended use or prescription of a device or drug manufactured or distributed by the company, as prescribed. The bill would also define other terms for its purposes. Under the bill, a violation of this disclosure provision would constitute unprofessional conduct.
This bill would require a physician and surgeon to post an open payments database notice, as described, in each location where the licensee practices and in an area that is likely to be seen by all persons who enter the office. The bill would require a physician and surgeon to conspicuously post the same open payments database notice on the internet website used for the physician and surgeon’s practice. The bill would require a health care employer to comply with these posting requirements instead if the physician and surgeon is employed by the health care employer.
This bill would require the responsible board to assess an administrative fine of $100 on a healing arts licensee for each violation. The bill would require the board to assess an administrative fine of $100 on a health care employer for each physician and surgeon who the employer employs and who would have been fined for violating the bill’s provisions. The bill would require that the administrative fines be deposited in the state General Fund and would declare that they be used, upon appropriation by the Legislature, to enforce the provisions of the bill.
This bill would specify that these provisions do not apply to a physician and surgeon or an osteopathic physician and surgeon working in a hospital emergency room.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Article 6.5 (commencing with Section 660) is added to Chapter 1 of Division 2 of the Business and Professions Code, to read:
Article  6.5. Open Payments Database Notices

660.
 For purposes of this article, all of the following definitions apply:
(a) “Drug or device company” means a manufacturer, developer, or distributor of pharmaceutical drugs or any device used in the context of the physician and surgeon’s or osteopathic physician and surgeon’s practice.
(b) “Health care employer” means an employer that provides health care services and that employs a physician and surgeon or an osteopathic physician and surgeon.
(c) “Open payments database” means the database created to allow the public to search for data provided pursuant to Section 1320a-7h of Title 42 of the United States Code and that is maintained by the federal Centers for Medicare and Medicaid Services.
(d) “Physician and surgeon” includes a physician and surgeon licensed pursuant to the Medical Practice Act (Chapter 5 (commencing with Section 2000)) or an osteopathic physician and surgeon licensed by the Osteopathic Medical Board of California under the Osteopathic Act.

661.
 (a) (1) A physician and surgeon who receives remuneration from a drug or device company shall disclose the source of the remuneration orally and in writing to each patient prior to the intended use or prescription of a device or drug manufactured or distributed by the company. A signature from the patient is required on the written disclosure.
(2) The written disclosure pursuant to paragraph (1) shall contain the following text:
“If you would like further details on the information provided above you may discuss with Dr. ____ and/or visit openpaymentsdata.cms.gov, a federal tool used to search payments made by drug and device companies to physicians and teaching hospitals.”
(b) A violation of this section shall constitute unprofessional conduct.

662.
 (a) (1) Notwithstanding any law, except as provided in subdivision (c), a physician and surgeon shall post in each location where the physician and surgeon practices, in an area that is likely to be seen by all persons who enter the office, an open payments database notice.
(2) The open payments database notice described in paragraph (1) shall include both of the following:
(A) An internet website link to the open payments database.
(B) A brief description of the purpose of the open payments database.
(b) Except as provided in subdivision (c), a physician and surgeon shall conspicuously post the open payments database notice described in subdivision (a) on the internet website used for the physician and surgeon’s practice.
(c) Notwithstanding subdivisions (a) and (b), if a physician and surgeon subject to this section is employed by a health care employer, the health care employer shall be responsible for meeting the requirements of this section.

663.
 (a) (1) The Medical Board of California or the Osteopathic Medical Board of California, as applicable, shall assess an administrative fine of one hundred dollars ($100) on a physician and surgeon for each violation of this article.
(2) For violations by a health care employer pursuant to subdivision (c) of Section 662, the Medical Board of California or the Osteopathic Medical Board of California, as applicable, shall assess an administrative fine of one hundred dollars ($100) on the health care employer for each violation by each physician and surgeon who is employed by the health care employer and who would have been fined for violating subdivision (a) or (b) of Section 662.
(b) Administrative fines collected pursuant to this section shall be deposited in the state General Fund and shall be used, upon appropriation by the Legislature, to enforce this article.

664.
 This article does not apply to a physician and surgeon or an osteopathic physician and surgeon working in a hospital emergency room.