10/03/2016

Under the Dome

by CASA Lobbyist Bryce Docherty

The Legislature adjourned their current session on Wednesday, August 31, 2016. They will reconvene on Monday, December 5, 2016 to swear-in the newly elected legislators and will officially begin their business of the next two-year session on Tuesday, January 3rd. The remainder of this article provides updates on several pieces of legislation from this past session that were of interest to CASA and the ASC industry in California.

Just remember: “If you miss a day “Under the Dome” – you miss a lot!”

LEGISLATIVE UPDATE

AB 72 (Bonta): Out-of-Network Healthcare Coverage

BRIEF SUMMARY: This legislation is the second coming of AB 533 (Bonta) from last year. After laborious negotiations the California Medical Association (CMA) removed their opposition late in the legislative session. The California Department of Managed Health Care (DMHC) and California Department of Insurance (DOI) will need to promulgate various regulations to fully implement some of the bill provisions. However, this legislation does the following:

By September 1, 2017, establishes a mandatory and binding Independent Dispute Resolution Process (IDRP) that both a provider or insurer can request to use after exhausting the health plan internal process should there be a dispute on services delivered to a patient in an in-network facility (i.e. acute care hospital and ASC) by a provider who is not in the health plan network, an Out of Network arrangement (OON). DMHC and DOI must establish procedures for this process. This is a win for the House of Medicine.

• Exempts emergency services from these provisions.
• Requires health plans to honor network adequacy and authorize and reimburse for these services in a timely manner.
• Establishes an interim payment for out of network services at either the higher of 125% of Medicare (fee-for-service, in geographic region) or the average commercial contracted rate (ACR).
• By July 1, 2017, requires health plans to provide to DMHC data on the services most frequently subject to the OON arrangement and how rates are determined.
• After a health plan submits this data, the rate for the interim payment will be adjusted by the Consumer Price Index for Medical Care Services.
• By January 1, 2019, DMHC will adopt a methodology that health plans must use to determine the ACR, which must include information from IDRPs, the specialty of the individual health professional and the geographic area where services are provided.
• Requires DMHC to consult stakeholders in developing the methodology with meetings starting no later than July 1, 2017
• Requires health plans to submit to DMHC the number of payments made in OON situations in order to determine the scope of the underlying issue.
• Requires health plans to honor existing network adequacy standards in these newly established OON situations.
• Defines OON events as those where a patient/enrollee receives health plan-covered services from a contracting facility (i.e. in-network ASC) provided by a non-contracting provider.
• Takes the patient out of the middle by ensuring they pay no more than the in-network amount in these situations.
• Allows patients to exercise a PPO benefit or OON benefit by providing 24-hour written consent to use an OON provider. This holds PPO products intact.
• Requires the provider to produce an estimate of the billed charges for that service at the time consent is provided.
• Allows for the charges to change should circumstances arise during the delivery of services that were unforeseeable at the time the estimate was given.

ASCs will want to inform their physicians of what health plans/insurers they are contracted with and make them aware that this bill applies if they happen to be out-of-network with that payer. ASCs may also want to assist their physicians in finding out from their contracted health plan/insurers what the patient’s in-network cost-sharing will be – especially if those physicians are not contracted providers with that payer. ASCs will also want to develop a written consent that their physicians could use in order for the bill provisions to not apply. This written consent must be given at least 24-hours prior to the procedure. ASCs are advised to instruct their physicians to obtain this consent as far in advance as possible. CASA is working with CMA on a FAQ document and toolkit to assist ASCs and out-of-network physicians in this regard.

STATUS: Signed into Law by Governor Brown
CASA POSITION: OPPOSE

AB 533 (Bonta): Out-of-Network Healthcare Coverage

BRIEF SUMMARY: This legislation was the precursor to AB 72 (Bonta) and is sponsored by Health Access California and required non-contracted/out-of-network physicians at in-network facilities (i.e. ASCs) to bill the patient only for their portion of in-network cost sharing as if the physician is contracted. The interim payment to the non-contracted/out-of-network physician will be straight Medicare (no multiplier). This bill would have also provided individual non-contracted/out-of-network physicians an Independent Dispute Resolution Process (IDRP) remedy to seek fair reimbursement for services rendered.

STATUS: Assembly Floor Inactive File – DEAD
CASA POSITION: OPPOSE

AB 1763 (Gipson): Colorectal Cancer Screening and Testing

BRIEF SUMMARY:  This bill requires a healthcare service plan contract or a health insurance policy that is issued, amended or renewed on or after January 1, 2018, to provide coverage for colorectal cancer screening examinations and laboratory tests. The bill also requires the coverage to include additional colorectal cancer screening examinations and laboratory tests recommended by the treating physician if the individual is at high risk for colorectal cancer. Lastly, the bill prohibits the imposition of cost sharing on colonoscopies, including the removal of polyps, for an enrollee who is between 50 and 75 years of age and has received a positive test.

Note: Governor Brown’s veto message stated: “I’m returning Assembly Bill 1763 without my signature. This bill imposes a no cost sharing mandate on health plans and insurance policies for colorectal cancer screening services that exceeds the requirements of the federal Affordable Care Act. I understand the importance of preventative health care services, and in particular, screening for various types of cancer. I believe, however, the cost sharing rules for these services as set in the Affordable Care Act are sufficient. Moreover, creating a no cost sharing rule for colorectal cancer sets it apart from all other cancers and contributes to increasing everyone’s health care costs.”

This veto is disappointing to CASA and essentially takes this issue off the table for the remainder of Governor Brown’s term, which is up in 2018. Similar legislation at the federal level has yet to move and many other states are also looking to address this issue as well.

STATUS: Vetoed by Governor Brown
CASA POSITION: SUPPORT

AB 2235 (Thurmond): Office-Based Pediatric Dental Anesthesia

BRIEF SUMMARY: This bill, which would be known as "Caleb's Law," declares the Legislature's intent that the Dental Board of California (DBC) encourages dental sedation providers in this state to submit data regarding pediatric sedation events to a research database in order to improve the quality of services provided to pediatric dental anesthesia patients. This bill also requires the DBC, on or before January 1, 2017, to provide a report to the Legislature on whether current statutes and regulations for the administration and monitoring of pediatric anesthesia in dentistry provides adequate protection of pediatric dental patients; specifies the minimum information that a licensee must report to the DBC in the event of a death of his or her patient or removal of a sedation or anesthesia patient to a hospital or emergency center for medical treatment, except as specified, and defines the categories of providers that are required to be specified; specifies that the information provided in this report is not an admission of guilt; authorizes the DBC to assess a fine on any licensee that fails to report an adverse event within a seven-day period and provides that the licensee may dispute a penalty within ten days; and, specifies the minimum information that a licensee include on the written informed consent in the case of a minor. 

CASA is concerned with the inherent risk of administering and monitoring pediatric anesthesia in dental offices. The standard of care is different in dental offices than the safeguards in place at an ASC or acute care hospital that performs similar procedures. CASA is most concerned with pediatric patient safety and will continue to monitor this issue very closely. CASA anticipates at least one piece of legislation next year to improve the standard of care in dental offices and expects the DBC to promulgate regulations to revise much of their anesthesia and sedation terminology, etc. 

STATUS: Signed into Law by Governor Brown
CASA POSITION: SUPPORT

AB 2750 (Gomez): Tissue Bank Licensing Exemption

BRIEF SUMMARY: This bill would create an additional exemption from the tissue bank licensing requirement for the storage of allograft tissue by a person if that person is a hospital or outpatient setting (i.e. ASC), the person maintains a log including specified information pertaining to the allograft tissue, and the allograft tissue meets specified requirements, including, among other things, that the allograft tissue was obtained from a California-licensed tissue bank, is individually boxed and labeled with a unique identification number and expiration date, and is intended for the express purpose of implantation into or application on a patient. 

NOTE: This bill sponsored by MiMedx is substantially similar to AB 1822 (Bonta) of 2014, which CASA supported.  

STATUS: Signed into Law by Governor Brown
CASA POSITION: WATCH

“If you miss a day “Under the Dome” – you miss a lot!”