October 2, 2009
Assembly Bill 2 (De La Torre, D - South Gate): Rescinding Healthcare Coverage
AB 2 would require the Department of Managed Health Care (DMHC) as well as the California
Department of Insurance (CDI) to review all health plan and insurer decisions to rescind individual
health plan contracts. This bill will also require the DMHC and CDI to standardize health history
questions that carriers must use in individual health care coverage application forms. AB 2 offers
solutions to the major problems of 1) lack of overview of the recession process and 2) confusion of
many individual health care coverage application forms.
Bill Status: AB 2 was amended on August 17 to remove a requirement that it apply to specialized
dental health care service plan contracts. Amendments were concurred in the Assembly on
September 10 and AB 2 was sent to Enrollment on September 25. The Governor has until October
11 to sign or veto this bill.
Assembly Bill 1422 (Bass, D - Los Angeles): MMC Tax for Healthy Families Program
AB 1422 would impose a 2.35% tax on the total operating revenue of Medi-Cal Managed Care
(MMC) plans. Proceeds from the tax would be continuously appropriated 1) to the State
Department of Health Care Services for purposes of the Medi-Cal program in an amount equal to
38.41% of the proceeds from the tax and 2) the Managed Risk Medical Insurance Board for
purposes of the Healthy Families Program in an amount equal to 61.59% of the proceeds from the
Bill Status: The bill was sent to Enrollment on September 8. The bill was signed by Governor
Schwarzenegger on September 22.
Assembly Bill 1542 (Committee on Health): Medical Home
AB 1542 adds a functional definition of “patient-centered medical home” (PCMH) to California law.
The goal of the medical home is to provide a patient with a broad spectrum of coordinated care.
AB 1542 would ensure uniform standards of quality and access for the PCMH that are engendered
by the Joint Principles of the American Academy of Family Physicians, the American Academy of
Pediatrics, the American Osteopathic Association, as well as the American College of Physicians.
Bill Status: AB 1542 was re-referred to the Assembly Health Committee on July 1. This is a two-
Senate Bill 196 (Corbett, D – San Leandro): Notification of Medical Service Elimination
SB 196 would require health facilities to provide 120-day notice of the planned reduction or
elimination of emergency medical services. Currently, reduction or elimination notices are to be
submitted days in advance to 1) the Department of Public Health, 2) the local government agency in
charge of health services and 3) any company under contract with the hospital to provide the
services. This bill would include hospital employees as a recipient of notices. SB 196 would also
require that the hospital provide public notice of, and hold a minimum of 3 public meetings on, the
intended change in a manner that is likely to reach a significant number of residents of the
community served by the facility.
Bill Status: SB 196 amendments from July 9 were concurred in the Senate and sent to enrollment
on September 9. The Governor has until October 11 to sign or veto this bill.
Senate Bill 303 (Alquist, D – Santa Clara): Psychotherapeutic Medication Consent
SB 303 enacts the Nursing Facility Resident Informed Consent Protection Act of 2009 and clarifies
and expands informed consent processes prior to the administration of psychotherapeutic (ie: anti-
psychotic, anti-anxiety) medications in skilled nursing facilities and intermediate care facilities.
Several physician organizations have opposed this measure, including the California Medical
Association, California Hospital Association, and the California Association of Health Facilities
because it will have a chilling effect on the ability of nursing homes and other facilities to adequately
recruit physicians and it will place additional prescriptive requirements on physicians in these
Bill Status: SB 303 received amendments on August 17 in the Assembly, were concurred in the
Senate and sent to enrollment on September 28. The Governor has until October 11 to sign or veto
Senate Bill 470 (Corbett, D – San Leandro): Prescription Labels, Purpose of Medication
SB 470 would require that every prescription include a legible, clear notice of the condition or
purpose for which the drug is prescribed, if requested by the patient. The bill would also require that
every prescription container be correctly labeled to include that information if indicated on the
prescription. Supporters of this bill believe it will reduce medication errors and confusion, especially
patients taking several medications for various conditions.
Bill Status: SB 470 originally went to the Governor on August 28 but was returned at the request of
the Senate. It has since been re-sent to enrollment on September 10. The Governor has until
October 11 to sign or veto this bill.
Assembly Bill 526 (Fuentes, D – Los Angeles): Physician Health Oversight
AB 526 would establish the Public Protection and Physician Health Program Act of 2009 to create -
within the State and Consumer Services Agency - the Public Protection and Physician Health
Oversight Committee. Until January 1, 2021, this committee would assist physicians and surgeons
who may be impaired by alcohol, substance abuse, dependence, or by a mental disorder. This
program would focus on early intervention, assessment, referral to treatment and monitoring of
physicians and surgeons with significant health impairments that may impact their ability to practice
safely. AB 526 is co-sponsored by the California Medical Association and the California Academy
of Family Physicians.
Bill Status: AB 526 was placed on the Senate Suspense file on August 27.
Senate Bill 726 (Ashburn, R – Bakersfield): Rural Hospitals
SB 726 would change the prohibition in current law against the employment of a physician by a
corporation (such as a hospital) by allowing virtually all Healthcare Districts and Rural Hospitals to
directly employ up to 5 physicians in a pilot program. The CEO of a facility must show that he/she
has have been unsuccessful in recruiting a physician for 12 months, that no currently contracted
physician or physician with privileges will be supplanted, and that the physician was not recruited
from an Federally Qualified Health Center (FQHC).
Bill Status: SB 726 was placed on the Assembly Inactive File on September 11.
Assembly Bill 648 (Chesbro, D – Eureka): Rural Hospitals, Employment
Similar to SB 726, AB 648 would allow rural general acute care hospitals to employ an unlimited
number of physicians and surgeons. This bill requires an employed physician and surgeon to sign a
contact agreement to exercise independent medical judgment and will notify the Medical Board of
California of any action or event that compromises independent medical judgment.
Bill Status: AB 648 failed to pass out of the Senate Business & Professions Committee on July 8.
Reconsideration has been granted.
For more information about these and other bills, and their current status, please visit the
ACP Legislative Update