Legislative and Policy Update
Dietmar Grellmann
Sr. Vice President, Managed Care &
Professional Services
California Hospital Association
November 21, 2013
Supermajority in the Legislature
Democratic Caucus achieved the two-thirds supermajority
in both houses through special elections this year
SENATE: 40
ASSEMBLY: 80
Reps:
12
Dems:
28
Reps:
25
Dems:
53
Powers of Supermajority: Raise taxes, amend the constitution, place
propositions on ballot, suspend rules. No minority party consent required.
This Year’s Statistics
• 2256 bills introduced
• 800 bills signed
• 96 bills vetoed
• 10% veto rate
3
2013 Health Legislation Volume
January
• health bills
introduced
Oct. 13
84
• bills passed by
Legislature
206
• bills signed
into law by
Governor
72
Sept. 13
Numbers are approximated, CAHP, CHA and CAPG track & categorize differently
ACA Implementation Special Session
Both “special” and “regular” sessions occurred
simultaneously during 2013:
 3 core principles: continuity w/ federal law,
level playing field in and out of Exchange, &
maintain state-level consumer protection:


Very compressed timeline over the winter and
early spring
Successful resolution of implementation
issues left open at the end of 2012 session
Special Sessions Called for
Health Care Reform
• ACA: AB 1X (Perez) & SB 1X
(Hernandez)
• Health Plan Coverage: AB 2x (Pan) and
SB 2x (Hernandez)
• Exchange: SB 3x bridge option for lowcost coverage to individuals in the
Exchange
6
“We Care California” Coalition
Held Rally at Capitol
 Close to 10,000 People Rally
 AB 900 (Alejo) to restore Medi-Cal Cuts and
Access to Care
 Backdrop: Budget deficits & cuts; AB 97 of
2011 imposed 10% or higher rate cuts
 Litigation – Injunction – Appeals – Denials –
More Appeals
7
Two Paths to a Partial Solution to
AB 97 Medi-Cal Cuts
 Access is Key: 42 U.S.C. §1396a(a)(30)(A)
 DHCS Announcement: Exempts rural
DP/SNF from AB 97 cuts due to decreased
access to care
 SB 239 (Hernandez) Lifts rate freeze &
restores all DP/NF cuts prospectively; Clawback remains
 Other Provider Rate Cuts Remain in Place
8
State Budget Trailer Bills Impact
Health Care Policy – $96.3 Billion
Health care related trailer bills:
• AB 82: Medi-Cal Expansion –
•
•
Partially restored Medi-Cal Dental benefits
•
Mandatory enrollment into Managed Care
SB 82: Appropriates $142 Million for Mental
health crisis centers & mobile crisis teams
9
SB 239 Creats a 30-Month
Hospital Fee Program
 SB 239 (Hernandez)

3-year fee program from 2013 forward

Creates framework for future fee programs


Stable funding for children’s health care
coverage
Lifts rate freeze and restores Medi-Cal rates to
DP/SNFs
10
New Requirements for
Districts, Drugs & Home Care



AB 130 (Alejo): Limits on Retirement
Plan Benefits for Health Care District
CEOs.
AB 1202 (Skinner): OSHA facility
standards for antineoplastic drugs
AB 1217 (Lowenthal): DSS licensing and
registry for home care agencies and staff
11
Hospital Facilities Bills Focus on
Secondary Costs & Wages
• SB 563 (Galgiani) requires costs for
producing construction plans.
• SB 615 (Galgiani), would have required
prevailing wages for certain hospital
construction. Vetoed
12
Two-year Bills Remain
• AB 333 (Wieckowski) Amendments to the
Medical Waste Management Act.
• AB 676 (Fox): Hospital Discharge Care
Coordination
• AB 975 (Wieckowski): Health Facilities
Community Benefit & Charity Care
• SB 718 (Yee): Workplace Violence
13
Out-of-Pocket Maximums
SB 639 applies to individual & small group
market products:





Limits individual and small group products to
annual OOP of 6,350/12,700 annually
Allows plans to use quarterly rate-adjustment
indexing
Limits small group deductibles to 2,000/4,000
Compliance date triggers vary – complicated
Pediatric Dental is a work in progress
Non-English Translation Standards
(SB 353) requires translation of documents in
individual and small group markets if you
advertise in a non-threshold, non-English
speaking language to anyone:
 Applications, Welcome letters or notices of initial
coverage, grievance process notices
 Not applicable to specialized plans
 Does not apply to the large group market
 Not the same list of documents required to be
translated under the Language Access regulation
Minimum Stop Loss Standards
(SB 161) sets minimum dollar standards at which stop
loss policies can indemnify small employer self-funded
plans:
 “small employers” are 100 or less employees
 standards increase after 1/1/2016:

$40,000 individual attachment point

Aggregate attachment point of either:

(i) $5,000 times the total number of group
members; (ii) 120 % of expected claims; (iii)
$40,000;
New Coverage Mandates for 2014

AB 219: Copayment limits for Oral Chemo - $200 cap
on OOP limits. Signing message makes it clear that
the law will sunset so that unintended consequences
can be evaluated

AB 460: Nondiscrimination in infertility treatment –
refers back to existing law on non-discrimination

SB 126: Autism coverage – continues sunset date of
SB 946 bill, extended to 2017 when EHBs are
revisited under federal review
Up Next: Bills that were Vetoed
And Bills that Stalled
Last Day Veto of Prevailing
Wages & Other Defeats
 SB 615 (Galgiani): Vetoed
 Out-of-Network Billing: SB 351
(Hernandez)
 Out-of-Network Notices: SB 266
(Lieu)
 MICRA attempt
19
Provider Oversight & Scope
SB 352: PA supervision of Medical Assistants
SB 493: Advanced Practice Pharmacists
SB 494: Empanelment expansion for NPs and PAs at 1,000
additional lives per midlevel practitioner
SB 670: Medical Board investigative authority in drug-related
patient deaths
AB 154: Midlevel autonomy from physician supervision for
abortions
AB 1000: Patient direct referral to physical therapists
AB 1308: Midwife autonomy from physician supervision
Regulatory Activity
Exchange Premium Payment Grace Periods

3 month period. 1st month covered

pend claims under months 2-3.

Allowed under Federal rule, but prohibited by
State law – what to do?

Reconciled California law (requiring all 3 mos.)
with the federal rule. Allowed to suspend
coverage during mos. 2-3.

Formal DMHC regulations to follow
The 2014 Initiative Landscape
2014 Initiatives:
 Charitable Hospital Executive Compensation
 Fair Health Pricing
 The Medi-Cal Funding & Accountability Act of
2014
 MICRA
 Health Plan Rate Review
22
QUESTIONS?
Dietmar Grellmann
dgrellmann@calhospital.org
916.552.7572