Law:Division 107. Statewide Health Planning And Development (California)

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Contents

Part 1. Office Of Statewide Health Planning And Development

Chapter 1. General Provisions

Ca Codes (hsc:127000-127050) Health And Safety Code Section 127000-127050



127000. There is in the state government, in the Health and Welfare Agency, an Office of Statewide Health Planning and Development.


127005. The office is under the control of an executive officer known as the Director of Statewide Health Planning and Development, who shall be appointed by the Governor, subject to confirmation by the Senate, and hold office at the pleasure of the Governor. He or she shall receive the annual salary provided by Article 1 (commencing with Section 11550) of Chapter 6 of Part 1 of Division 3 of Title 2 of the Government Code.


127010. The director of the office shall have the powers of a head of the department pursuant to Chapter 2 (commencing with Section 11150) of Part 1 of Division 3 of Title 2 of the Government Code.


127015. The office succeeds to and is vested with all the duties, powers, purposes, responsibilities, and jurisdiction of the State Department of Health relating to health planning and research development. The office shall assume the functions and responsibilities of the Facilities Construction Unit of the former State Department of Health, including, but not limited to, those functions and responsibilities performed pursuant to the following provisions of law: Chapter 1 (commencing with Section 127125) of Part 2, Article 1 (commencing with Section 127750) of Chapter 1, Article 3 (commencing with Section 127975) of Chapter 2, and Article 1 (commencing with Section 128125) of Chapter 3 of Part 3, Part 6 (commencing with Section 129000) and Part 7 (commencing with Section 129675) of this division, Section 127050; Chapter 10 (commencing with Section 1770) of Division 2; and Section 13113.


127020. All regulations heretofore adopted by the State Department of Health that relate to functions vested in the office and that are in effect immediately preceding July 1, 1978, shall remain in effect and shall be fully enforceable unless and until readopted, amended, or repealed by the office.

127025. The office may use the unexpended balance of funds available for use in connection with the performance of the functions of the State Department of Health transferred to the office pursuant to Section 127015.

127030. All officers and employees of the State Department of Health, who, on July 1, 1978, are serving in the state civil service, other than as temporary employees, and engaged in the performance of a function vested in the Office of Statewide Planning and Development by Section 127015 shall be transferred to the office. The status, positions, and rights of these persons shall not be affected by the transfer and shall be retained by them as officers and employees of the office, pursuant to the State Civil Service Act except as to positions exempted from civil service.


127035. The office shall have possession and control of all records, papers, offices, equipment, supplies, moneys, funds, appropriations, land or other property, real or personal, held for the benefit or use of the State Department of Health for the performance of functions transferred to the office by Section 127015.


127040. All officers or employees of the office employed after July 1, 1978, shall be appointed by the director of the office.


127045. The office may enter into agreements and contracts with any person, department, agency, corporation, or legal entity that are necessary to carry out the functions vested in the office by this chapter, Article 1 (commencing with Section 127875), Article 2 (commencing with Section 127900), Article 5 (commencing with Section 128050) of Chapter 2, Article 2 (commencing with Section 128375), and Article 3 (commencing with Section 128425) of Chapter 5 of Part 3.


127050. (a) As used in this section, "nonprofit hospital" means a general acute care hospital or an acute psychiatric hospital owned and operated by a fund, foundation, or corporation, no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual. (b) A nonprofit hospital may exercise the right of eminent domain to acquire property necessary for the establishment, operation, or expansion of the nonprofit hospital if both of the following requirements are satisfied: (1) The property to be acquired by eminent domain is adjacent to other property used or to be used for the establishment, operation, or expansion of the nonprofit hospital. (2) The director of the office has certified, after the public hearing required by subdivision (c), all of the following: (A) The acquisition of the property sought to be condemned is necessary for the establishment, operation, or expansion of the nonprofit hospital. (B) The public interest and necessity require the proposed project. (C) The proposed project is planned or located in the manner that will be most compatible with the greatest public good and the least private injury. (c) The director of the office shall adopt reasonable regulations that will provide for a public hearing to be conducted by a hearing officer in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code in the area where the hospital is located to determine the necessity of the proposed project and of any acquisition of property for the project. Written notice of the hearing shall be given to the voluntary area health planning agency, if one exists, in the area where the hospital is located. The voluntary area health planning agency so notified shall make its recommendations to the hearing officer within 90 days from the receipt of notice. No hearing shall be held prior to the expiration of the 90-day period unless the hearing officer has received the recommendations of the voluntary area health planning agency. At the public hearing, the hearing officer shall ensure that the hearing, in part at least, considers the impact of the proposed project upon the delivery of health care services in the community and upon the environment, as gathered from an environmental impact report. The applicant and all interested parties to the acquisition, including the voluntary area health planning agency, have the right to representation by counsel, the right to present oral and written evidence, and the right to confront and cross-examine opposing witnesses. A transcript of the public hearing shall be filed with the director of the office as a public record.


Part 2. Health Policy And Planning

Chapter 1. Health Planning

Ca Codes (hsc:127125-127300) Health And Safety Code Section 127125-127300



127125. As used in this chapter, "office" means the Office of Statewide Health Planning and Development and "office director" means the director of the office. Any reference in this chapter to the State Department of Health, the department, the state department, or the Director of Health shall be deemed a reference to the office in the Health and Welfare Agency.

127130. For the purposes of this chapter: (a) "Health maintenance organization" or "HMO" means a public or private organization, organized under the laws of this state, that: (1) Provides or otherwise makes available to enrolled participants health care services, including at least the following basic health care services: usual physician services, hospitalization, laboratory, X-ray, emergency and preventive services, and out-of-area coverage. (2) Is compensated (except for copayments) for the provision of basic health care services listed in paragraph (1) to enrolled participants on a predetermined periodic rate basis. (3) Provides physician services primarily (i) directly through physicians who are either employees or partners of the organization, or (ii) through arrangements with individual physicians or one or more groups of physicians (organized on a group practice or individual practice basis). (4) Is not a corporation organized or operating pursuant to Section 10810 of the Corporations Code. (b) "Health maintenance organization for which assistance may be provided under Title XIII" means an HMO that is qualified under Section 1310(d) of Title XIII of the federal Public Health Service Act, or an HMO that the Secretary of Health, Education and Welfare determines, upon the basis of an application and the submission of any information and assurance that he or she finds necessary, may be eligible for assistance under Title XIII of the act.


127135. Any reference in any code to the Health Planning Council, the Health Review and Program Council, or the State Board of Public Health, with respect to functions thereof that are advisory, shall be deemed a reference to the Advisory Health Council.


127140. (a) In order to effectively implement this chapter, the Legislature finds that it is indispensable that providers of health care be free to engage in voluntary, cooperative efforts with consumers, government, or other providers of health care to fulfill the purposes of the health planning laws. (b) Approved plans and projects undertaken in compliance with those plans, as provided in Sections 437.20, 437.21, 437.22, and 437.23 are exempt from Chapter 1 (commencing with Section 16600), Chapter 2 (commencing with Section 16700), Chapter 3 (commencing with Section 16900), and Chapter 4 (commencing with Section 17000) of Part 2 of Division 7 of the Business and Professions Code. (c) In the case of a project that, on or before January 1, 1987, is included in the Tulare County countywide long-range capital investment plan, that is contained in the "April 1983 Multi-Hospital Capital Investment and Master Plan," as amended by the April 1986 update, the exemptions set forth in subdivision (b) shall apply even though the project is not undertaken until after January 1, 1987.


127145. (a) The Advisory Health Council, with the recommendation of the department, shall approve the statewide health facility and services plan adopted pursuant to subdivision (b) of Section 127155. (b) The Advisory Health Council shall advise the department in the conduct of its health planning activities and in the setting of priorities in accordance with the statewide health facility and services plan adopted pursuant to subdivision (b) of Section 127155. (c) Public agencies shall furnish to the Advisory Health Council, upon request, data on health programs pertinent to effective planning and coordination. (d) The Advisory Health Council shall act as the appeals body pursuant to Section 127250 regarding applications for a certificate of need filed pursuant to this chapter.

127150. (a) The office director shall adopt regulations for the implementation of this chapter. (b) Notwithstanding any other provision of this chapter to the contrary, the office director may suspend the operation of any or all of the following provisions or requirements of this chapter: (1) The administrative appeals process for certificate-of-need applications established by Sections 127250 to 127270, inclusive. Nothing in this section shall be construed, however, to limit the availability of judicial review of a decision of the office director or of the Advisory Health Council as provided in Section 127275. (2) The notification of intent required by Section 127225. (c) It is the intent of the Legislature that the office and the area health planning agencies shall not implement the requirements of subdivisions (g) and (h) of Section 1513 of the Public Health Service Act. To the extent required by federal law, the office and area health planning agencies shall request from the Secretary of the United States Department of Health and Human Services a waiver from those requirements. (d) The Governor shall not execute an agreement with the Secretary of the United States Department of Health and Human Services pursuant to Section 1122 of Public Law 92-603 as the section existed on January 1, 1981.

127155. The Advisory Health Council shall evaluate and shall designate annually no more than one area health planning agency for any area of the state designated by the council. An area health planning agency shall be incorporated as a nonprofit corporation and controlled by a board of directors consisting of a majority representing the public and local government as consumers of health services with the balance being broadly representative of the providers of health services and the health professions, or alternatively be a health systems agency established pursuant to Public Law 93-641. The functions of area health planning agencies are all of the following: (a) To review information on utilization of hospitals and related health facilities. (b) To develop area plans to be used for the determination of community need and desirability of projects specified in Section 127170, consistent with the regulations adopted by the office pursuant to Section 127160. Each plan shall become effective upon a determination by the council that the plan is in conformance with regulations adopted pursuant to Section 127160. The council shall integrate all area plans into a single Statewide Health Facilities and Services Plan that shall become effective upon formal adoption by the council. (c) To conduct public meetings where providers of health care and consumers will be encouraged to participate. (d) Area health planning agencies shall comply with all of the following requirements: (1) The governing body of the agency shall, to the extent feasible, be composed of individuals representative of the major social, economic, linguistic, and racial populations, and geographic areas, within the area served by the agency. (2) The agency shall hold public meetings and hearings only after reasonable public notice. This notice shall, to the extent feasible, be publicized directly to those who, as determined by the director, are medically underserved and are in other ways denied equal access to good medical care. (3) The agency shall file with the Advisory Health Council an affirmative action employment plan approved by the office. Area health planning agencies may divide their areas into local areas for purposes of more effective health facility planning, with the approval of the Advisory Health Council. These local areas shall be of a geographic size and contain adequate population to ensure a broad base for planning decisions. Each local area shall contain a local health planning agency that shall meet the requirements of this section. An organization that meets the requirements of this section may make application to its area health planning agency for designation as a local health planning agency for a designated area. Within 45 days after a complete application for designation has been received, the area agency shall reach a decision concerning the application. Each area health planning agency existing on the operative date of amendments to this section enacted during the 1976 portion of the 1975-76 Regular Session of the Legislature shall continue to function as an area planning agency pursuant to this chapter, until one or more designated health systems agencies are fully operational, as determined by the Advisory Health Council in the area served, or formerly served, by the respective area health planning agency. If the Advisory Health Council determines that an area health planning agency approved under this section is dissolved or unable to carry out the functions required by this chapter, the office shall fulfill the responsibilities of an area health planning agency pursuant to this chapter in the area until another area health planning agency is designated by the Advisory Health Council for the area and becomes fully operational. Adoption of regulations setting forth administrative procedures for area and local area health planning agencies shall be made by the office pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.


127160. The office shall adopt regulations setting forth statewide policies for area health planning agencies in the performance of their responsibilities under Section 127155. In adopting the regulations, the office shall, with the advice of the Advisory Health Council, consider the following factors, and may consider other factors not inconsistent with the following: (a) The need for health care services in the area and the requirements of the population to be served, including evaluation of current utilization patterns. (b) The availability and adequacy of health care services in the area's existing facilities that currently conform to federal and state standards. (c) The availability and adequacy of services in the area such as preadmission, ambulatory or home care services that may serve as alternatives or substitutes for care in health facilities. (d) The possible economies and improvement in service that may be derived from the following: (1) Operation of joint, cooperative, or shared health care resources. (2) Maximum utilization of health facilities consistent with the appropriate levels of care, including, but not limited to, intensive care, acute general care, and skilled nursing care. (3) Development of medical group practices, especially those providing services appropriately coordinated or integrated with institutional health service, and development of health maintenance organizations. (e) The development of comprehensive services for the community to be served. These services may be either direct or indirect through formal affiliation with other health programs in the area, and include preventive, diagnostic, treatment and rehabilitation services. Preference shall be given to health facilities that will provide the most comprehensive health services and include outpatient and other integrated services useful and convenient to the operation of the facility and the community. (f) The needs or reasonably anticipated needs of special populations, including members of a comprehensive group practice prepayment health care service plan, members of a religious body or denomination who desire to receive care and treatment in accordance with their religious conviction, or persons otherwise contracted or enrolled under extended health care arrangements, including life-care agreements pursuant to Chapter 10 (commencing with Section 1770), Division 2 of the Health and Safety Code. (g) The special needs and circumstances of those entities that provide a substantial portion of their services or resources, or both, to individuals not residing in the health service areas where the entities are located. These entities may include medical and other health professional schools, multidisciplinary clinics, and specialty centers. With respect to the determination of unmet need in the community or the adverse effect of new or expanded surgical clinics on the utilization of operating rooms in hospitals, it is not the intent of the Legislature to limit the expansion of surgical clinics when the hospitals have not made efforts to fully utilize their ambulatory operating capacity and to provide ambulatory surgical services at a reasonable cost to the community.


127165. (a) The basis for decisions by the office on applications for certificates of need filed pursuant to this chapter shall be: (1) The Statewide Health Facilities and Services Plan specified in subdivision (b) of Section 127155. (2) The statewide policies developed pursuant to Section 127160. (b) The office shall annually update the statistical information used in the determination of resource requirements in the Statewide Health Facilities and Services Plan and shall update this statistical information more frequently when new data is available. These data updates shall include, but not be limited to, population estimates, utilization data, changes in the inventory, and other statistical information used in the determination of resource requirements. This data shall be incorporated into the Statewide Health Facilities and Services Plan by operation of law and without the necessity of following the procedures set forth in Chapter 3.5 (commencing with Section 11340) of Title 2 of Division 3 of the Government Code.


127170. Except as otherwise exempted by any other provision of law, projects requiring a certificate of need issued by the office are the following: (a) Construction of a new health facility, relocation of a health facility or specialty clinic on a site that is not the same site or adjacent thereto, the increase of bed capacity in an existing health facility, the conversion of an entire existing health facility from one license category to another, or the conversion of a health facility's existing beds from any bed classification set forth in Section 1250.1 to skilled nursing beds, psychiatric beds, or intermediate care beds, and the conversion of skilled nursing beds, psychiatric beds, or intermediate care beds to any other bed classification set forth in Section 1250.1, except for skilled nursing beds or intermediate care beds licensed as of March 1, 1983, as part of a general acute care hospital. The conversion may not exceed during any three-year period 5 percent of the existing beds of the bed classification to which the conversion is made. A health facility may use beds in one bed classification that, pursuant to the facility's license, have been designated in another bed classification, if all of these bed classification changes do not at any time exceed 5 percent of the total number of the facility's beds as set forth by the facility's license and if this use meets the requirements of Chapter 2 (commencing with Section 1250) of Division 2. In addition, a facility may use an additional 5 percent of its beds in this manner if the director finds that seasonal fluctuations justify it. For purposes of this subdivision, "adjacent," means real property within a 400-yard radius of the site where a health facility or specialty clinic currently exists. (b) Establishment of a new specialty clinic, as defined in paragraphs (1) and (3) of subdivision (b) of Section 1204, a project by a health facility for expanded outpatient surgical capacity, the conversion of an existing primary care clinic to a specialty clinic, or the conversion of an existing specialty clinic to a different category of specialty-clinic licensure. It does not constitute a project and no certificate of need is required for the establishment of a primary care clinic, as defined in subdivision (a) of Section 1204, the conversion of an existing specialty clinic to a primary care clinic, or the conversion of an existing primary care clinic to a different category of primary-care-clinic licensure. Any capital expenditure involved in the establishment of a primary care clinic also does not constitute a project, except as provided in subdivision (d). (c) The establishment of a new special service delineated in subdivision (a), (b), (c), (e), (f), (g), or (h) of Section 1255, or the establishment by a specialty clinic, as defined in paragraphs (1) and (3) of subdivision (b) of Section 1204, of a new special service identified by or pursuant to Section 1203. (d) The initial purchase or lease by a clinic subject to licensure under Chapter 1 (commencing with Section 1200) of Division 2, of diagnostic or therapeutic equipment with a value in excess of one million dollars ($1,000,000) in a single fiscal year, or where the cumulative cost exceeds this amount in more than one fiscal year. For purposes of this subdivision, the purchase or lease of one or more articles of functionally related diagnostic or therapeutic equipment, as determined by the office, shall be considered together. (e) (1) Any project requiring a capital expenditure for a specialty clinic, as defined in paragraphs (1) and (3) of subdivision (b) of Section 1204, or for the services, equipment or modernization of a specialty clinic in excess of one million dollars ($1,000,000) in the current fiscal year or cumulation to an expenditure of one million dollars ($1,000,000) in the same fiscal year or subsequent fiscal years for a single project. (2) The threshold exemptions from certificate-of-need requirements provided for in this subdivision do not apply to projects for expanded outpatient surgical capacity. (3) For the purposes of this subdivision, "capital expenditure" means any of the following: (A) An expenditure, including an expenditure for a construction project undertaken by the specialty clinic as its own contractor, that under generally accepted accounting principles is not properly chargeable as an expense of operation and maintenance and that exceeds one million dollars ($1,000,000). The cost of studies, surveys, legal fees, land, offsite improvements, designs, plans, working drawings, specifications, and other activities essential to the acquisition, improvement, expansion, or replacement of the physical plant and equipment for which the expenditure is made shall be included in determining whether the cost exceeds one million dollars ($1,000,000). Where the estimated cost of a proposed project, including cost escalation factors appropriate to the area where the project is located, is, within 60 days of the date that the obligation for the expenditure is incurred, certified by a licensed architect or engineer to be one million dollars ($1,000,000) or less, that expenditure shall be deemed not to exceed one million dollars ($1,000,000) regardless of the actual cost of the project. However, in any case where the actual cost of the project exceeds one million dollars ($1,000,000) the specialty clinic on whose behalf the expenditure is made shall provide written notification of the cost to the office not more than 30 days after the date that the expenditure is incurred. The notification shall include a copy of the certified estimate. (B) The acquisition, under lease or comparable arrangement, or through donation, of equipment for a specialty clinic, the expenditure for which would have been considered a capital expenditure if the person had acquired it by purchase. For the purposes of this paragraph, "donation" does not include a bequest. (C) Any change in a proposed capital expenditure that meets the criteria set forth in this subdivision. (4) "Capital expenditure" includes the total cost of the proposed project as certified by a licensed architect or engineer based on preliminary plans or specifications and concurred in by the state department. (5) For the purposes of this subdivision, "project" does not include the purchase of real property for future use or the transfer of ownership, in whole or part, of an existing specialty clinic or the acquisition of all or substantially all of the assets or stock thereof, or the construction, modernization, purchase, lease, or other acquisition of parking lots or parking structures, telephone systems, and nonclinical data-processing systems. (6) For the purposes of this subdivision, "modernization" means the alteration, expansion, repair, remodeling, replacement, or renovation of existing buildings, including initial equipment thereof, and the replacement of equipment of existing buildings. (f) Except as provided in subdivision (g), only those projects where 25 percent or less of the patients are covered by prepaid health care. (g) Projects otherwise subject to review under subdivision (a) that are for the addition of new licensed skilled nursing beds by construction or conversion, regardless of the percentage of patients served who are covered by prepaid health care. (h) (1) Except as provided in paragraph (2), the office shall annually adjust the dollar thresholds set forth in subdivisions (d) and (e) to reflect changes in the cost of living, as determined by the Department of Finance, using 1981 as the base year. (2) Notwithstanding the amount of the dollar thresholds specified in paragraph (1), in the event Congress increases or repeals the amount or amounts of the thresholds, the dollar thresholds set forth in subdivisions (d) and (e) shall be the highest amount or amounts permitted by Public Law 93-641, as amended, or one million dollars ($1,000,000), whichever is less, on the date congressional action is effective. (i) This section is not applicable to an intermediate care facility/developmentally disabled habilitative or an intermediate care facility/developmentally disabled--nursing.


127175. (a) The office shall exempt from Sections 127210 to 127275, inclusive, and shall issue a certificate of exemption for those projects that were not previously subject to review under Section 127155 prior to the effective date of this section where the applicant has shown and the office director has found all of the following: (1) The applicant has, prior to the effective date of this section, committed or incurred a financial obligation, including any obligation payable by force account, that is certified by a licensed architect or engineer to be 10 percent of the cost of the total project, or seventy-five thousand dollars ($75,000), whichever is less. (2) The project cannot be terminated without substantial economic loss to the applicant. (3) Except with respect to projects set forth in subdivision (d) of Section 127170, the project was commenced prior to the effective date of this section and is being diligently pursued to completion. (4) The applicant has filed a notice of the project with the office on forms supplied by the office within 60 days of the effective date of this section. For the purposes of this subdivision, "project" shall mean any project set forth in Section 127170, and the term "financial obligation" shall include cost factors set forth in the definition of "capital expenditure" in Section 127170. Within 120 days of the effective date of this section, the office shall determine in public hearing the applications that are entitled to an exemption under this subdivision. (b) In addition, the office shall exempt from Sections 127210 to 127275, inclusive, and shall issue a certificate of need for those projects where the applicant has shown and the office director has found one of the following: (1) The project is necessary solely to replace health care services that are no longer available at the facility because of a disaster or other emergency. (2) The project is solely for the purpose of complying with requirements of law or regulations. (3) The project was the subject of an application submitted to an area health planning agency prior to the effective date of this section. These applications shall be processed and decided in the manner prescribed by this chapter as it existed immediately prior to the operative date of this section, except that any petition for appeal of a decision or lack of decision the area health planning agency rendered after the effective date of this section shall be made directly to the Advisory Health Council. (4) The project is to add not more than 10 percent of licensed bed capacity or 10 beds, whichever is less, to an existing general acute care hospital, an existing acute psychiatric hospital, an existing special hospital, an existing general acute care/rehabilitating hospital, or an existing chemical dependency recovery hospital, where the applicant has shown and the office director has found that: (A) The applicant hospital has not been granted a certificate of exemption pursuant to this provision or pursuant to Section 437.112, as Section 437.112 existed on January 1, 1982, within the last preceding 24 months. (B) The applicant hospital has had an occupancy rate for the classification of beds to be added, and for the facility as a whole, for the preceding 12-month period, of not less than 85 percent. (C) The facility is accessible to persons for whom the cost of care is reimbursed under Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of the Welfare and Institutions Code. In the case of an acute psychiatric hospital, the showing required by this subparagraph shall be limited to those categories of patients for whom acute psychiatric hospitals are eligible to receive reimbursement under Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of the Welfare and Institutions Code. (5) The project is to add not more than five beds to an existing skilled nursing facility that is operated as a distinct part of a primary health service hospital, as defined in Section 1339.9 that participates in Medi-Cal programs, provided that all of the following conditions exist: (A) At the time of the application, the Statewide Health Facility and Services Plan indicates a need for the proposed number of beds, taking into account the number of approved beds in the health facilities planning area where the project is located including beds approved pursuant to this subdivision. (B) The applicant skilled nursing facility has had at least a 95 percent occupancy rate for existing beds for the 12 months preceding the submission of an application. (C) The applicant facility has not been issued within the 12 months preceding application a citation for a class A violation or more than one class B violation, as defined in Section 1424, that is one of the following: (i) Uncontested. (ii) Contested, but not adjudicated. (iii) Contested, but sustained upon adjudication. In determining the current number of approved beds in the health facilities planning area where the project is located, the office shall count the number of beds for which applications for a certificate of need have been deemed complete pursuant to Section 127220, before the effective date of the amendments to this section enacted by the Statutes of 1983. The project shall not require a capital expenditure that exceeds ten thousand dollars ($10,000), and only one project may be approved for a facility in a 12-month period. However, no facility shall receive approval pursuant to this section for more than two projects. The office shall annually adjust this capital expenditure threshold to reflect changes in the cost of living as determined by the Department of Finance, using 1981 as the base year. Any certificate issued for projects shall expire if the applicant does not complete the project within 12 months after issuance unless the office, for good cause shown, extends the certificate. (c) A certificate of exemption issued pursuant to this section or Section 1268 shall, for all purposes, have the same effect as a certificate of need issued pursuant to this chapter.


127180. (a) In addition to the exemption required by Section 127175, the office director shall exempt Sections 127210 to 127275, inclusive, and shall issue a certificate of exemption for those projects where the applicant has shown, and the office director has found, all of the following: (1) The conversion of a freestanding skilled nursing facility to a chemical dependency recovery hospital, as defined in Section 1250.3, where the project was commenced on or before September 15, 1981, and provided that the person or entity proposing the project was, prior to June 1, 1981, operating in this state a health facility, or distinct part thereof, that provided 24 hours' chemical dependency recovery hospital in-patient services as enumerated in Section 1250.3 under a direction of a medical director, and that the person or entity was the owner or lessee of the facility to be converted prior to June 1, 1981. As used in this paragraph, "person" or "entity" shall include collectively a corporation and any wholly owned subsidiaries thereof. "Commencement" means the submission of drawings for the project to the local government having jurisdiction containing substantially sufficient detail for the issuance of a building permit or permits as required and submission of a written declaration of intent for the project to the department on or before September 15, 1981. (2) The project does not meet the construction standards established by law or regulation for general acute care hospitals. (3) The applicant has filed a notice of the project with the office director on or before September 15, 1981. (4) The applicant has filed a notice of the project with the office director on forms supplied by the office director within 90 days of the effective date of this section. The office director shall inform the applicant in writing of his or her determination as to eligibility of the application for a certificate of exemption under this section within 60 days of receipt of a complete application. (b) A certificate of exemption issued pursuant to this section shall for all purposes have the same effect as a certificate of need issued pursuant to this chapter.


127185. (a) In addition to the exemption required by Section 127175, the office director shall exempt from Sections 127210 to 127275, inclusive, and shall issue a certificate of need for those projects where the applicant has shown and the office director has found all of the following: (1) The project is for either of the following: (A) The conversion of a skilled nursing or community care facility, or acute psychiatric hospital or a county funded institution-based alcoholism program, certified by the Department of Alcohol and Drug Programs pursuant to Section 11831 as a residential treatment program, to a chemical dependency recovery hospital as defined in subdivision (a) of Section 1250.3, and provided that the facility to be converted has, prior to June 1, 1981, and continuously thereafter, been used exclusively to provide 24-hour residential chemical dependency recovery services, including the basic services enumerated in Section 1250.3 under the direction of a medical director. (B) The construction and licensure of a chemical dependency recovery hospital where the project was commenced prior to June 1, 1981, and is being diligently pursued to completion, and provided that the person or entity proposing the facility was, prior to June 1, 1981, operating in this state a skilled nursing or community care facility used exclusively for 24-hour residential chemical dependency recovery services, including the basic services enumerated in Section 1250.3, under the direction of a medical director. As used in this paragraph, "commencement of the project" means acquisition of the site where the facility is to be located and submission of drawings for the project to the local government having jurisdiction containing substantially sufficient detail for the issuance of a building permit or permits. (2) The project could not meet the construction standards established by law or regulation for general acute care hospitals. (3) The applicant has filed a notice of the project with the office director on forms supplied by the office director within 90 days of the effective date of this section. The office director shall inform the applicant in writing of his or her determination as to eligibility of the application for a certificate of need under this subdivision within 60 days of receipt of a complete application. (b) In addition to the exemption required by Section 127175, the office director shall exempt from Sections 127210 to 127275, inclusive, and shall issue a certificate of need for a project for the conversion of a portion of the authorized bed capacity of a general acute care hospital in the classifications listed in Section 1250.1 to chemical dependency recovery beds as provided in subdivision (h) of Section 1250.1, or for the conversion of a skilled nursing facility to a chemical dependency recovery hospital as defined in subdivision (a) of Section 1250.3, where the applicant has shown and the office director has found all of the following: (1) Commencement of the project began prior to August 10, 1981, and is being diligently pursued to completion. (2) The facility proposing a conversion was, prior to June 1, 1981, operating an alcoholism treatment program, including all the basic services enumerated in Section 1250.3, under the direction of a medical director, or the facility had obtained, prior to June 1, 1981, the services of a medical director and contracted with program professionals for the conversion of the facility. As used in this subdivision, "commencement of the project" means a written declaration by the governing body or administration of a hospital of the intention to convert beds of other licensed categories to usage as chemical dependency beds pursuant to subdivision (f) of Section 1250.3 as it existed on August 10, 1981, or a written declaration by the governing body or administration of a skilled nursing facility of the intention to convert to a chemical dependency recovery hospital. The written declaration shall be transmitted to the director by August 17, 1981. (c) Construction or remodeling necessary to enable a facility exempted under this section to comply with applicable licensing regulations shall be deemed to be eligible for exemption under paragraph (2) of subdivision (b) of Section 127175. (d) A certificate of exemption issued pursuant to this section shall, for all purposes, have the same effect as a certificate of need issued pursuant to this chapter.


127190. Notwithstanding any other provision of this chapter, the office shall exempt from Sections 127210 to 127275, inclusive, and shall issue a certificate of need for, any health care project of a health facility that agrees to provide free health care services to indigents over a period of at least five years at a dollar value equal to the dollar value of the exempted project at completion. The annual dollar value of the free care shall be at a level equal to at least 10 percent of the project value as determined in the agreement. The free health care services shall be furnished in the form of direct service or by reimbursement of costs incurred by other facilities if an insufficient number of patients, as determined in the agreement, are referred or present themselves for treatment to account for the minimum 10 percent requirement. The provision of free care pursuant to this section shall be in accordance with an agreement executed between the health facility granted an exemption and the office. If the health facility does not meet the terms of the agreement, the department shall suspend the license or special permit associated with the exempted project until compliance with the terms is obtained. The obligations imposed by the agreement shall not be discharged by virtue of transfer of ownership, but shall be assumed by a new owner as a condition of transfer. "Free care," as used in this section, does not include either of the following: (a) Bad debt unless the debtor makes specific application for relief as an indigent. (b) Contractual allowances.

127195. Projects for freestanding outpatient surgery units that only perform cataract surgery under the Medi-Cal program or a program that provides over 25 percent of its services to patients covered by prepaid health care are exempt from the certificate-of-need requirement of this chapter. As used in this section and in paragraphs (f) and (g) of Section 127170, patients are covered by prepaid health care if they are members of federally qualified health maintenance organizations.


127200. Taking into consideration the basis for decision set forth in Section 127165: (a) The office may, in individual cases, grant certificates of need for projects when it determines that one of the following is applicable: (1) The applicant has provided evidence that the project will meet the needs or reasonably anticipated needs of a special population including members of a religious body or denomination who desire to receive care and treatment in accordance with their religious convictions. (2) The applicant has provided evidence that the project is or will be necessary to meet the health needs or reasonably anticipated health needs of adult residents of a nonprofit community care facility, as defined by subdivision (a) of Section 1502, that is owned by the applicant. (3) The applicant has provided evidence that, as a health facility, it has developed community support for its services as indicated by its current utilization patterns, and has provided health care services for at least five years. (4) The applicant has provided evidence, when the project is for a new health facility or an increase in bed capacity, that there will be an equal or greater reduction in bed capacity in other health facilities in the area. (5) The applicant has provided evidence that it will deliver the service proposed to be offered as a result of the project in an innovative and more competitive manner, or at a lower cost than the service is provided by other facilities in the area, and has provided evidence that the quality of care offered will be comparable to that offered by other facilities in the area; or that as a health facility, it serves a disproportionate volume of publicly funded patients, or patients for whom the cost of health care is uncompensated. The office director shall, as he or she deems appropriate, ensure fulfillment of the requirements of this subdivision through conditions mutually agreed upon by the applicant and the office. This paragraph does not apply to projects for the addition of licensed skilled nursing beds by construction or conversion. If an applicant is requesting the exercise of discretion by the office director pursuant to this paragraph, prior to granting a certificate of need, the office director shall receive an evaluation from the department assessing the potential negative financial impact upon any county owned or operated general acute care hospital. If there is a significant negative potential financial impact, a certificate of need shall not be granted. Nothing in this subdivision requires the office to grant certificates of need as authorized by this section in any of the above categories. (b) In the case of a project for a service to be provided by or through a health maintenance organization for which assistance may be provided under Title XIII, the office shall grant a certificate of need for the project unless the office director finds that the project is not needed by the enrolled or reasonably anticipated new members of the HMO or proposed HMO or the beds or services to be provided are available from non-HMO providers or other HMO's in a reasonable and cost-effective manner that is consistent with the basic method of operation of the HMO. For the purposes of subdivision (b), beds or services shall not be considered available if they are any of the following: (1) Dispersed in more than one facility when the HMO's basic method of operation is to provide services through medical centers that consist of a hospital and medical offices at the same site. (2) Not available under a contract of at least five years' duration, with an option to extend the contract for an additional time period as is reasonably necessary for the HMO to obtain a certificate of need and to construct and equip and begin operating alternative beds or service, in the event the non-HMO provider or other HMO gives notice that it intends to terminate the contract. (3) Not available under circumstances that would grant full and equal staff privileges to an adequate number of physicians associated with the HMO in appropriate specialties, or otherwise not conveniently accessible through physicians and other health care professionals associated with the HMO. (4) Not available in a manner that is administratively feasible to the HMO. (5) More costly than if the services were provided by the HMO. In order to qualify under this section, a project that is proposed to be provided by or through a health maintenance organization for which assistance may be provided under Title XIII, and that consists of or includes the construction, development, or establishment of a new inpatient health care facility, shall be a facility that the office determines will be utilized by members of the health maintenance organization for at least 75 percent of the projected annual inpatient days, as determined in accordance with the recommended occupancy levels under the applicable health systems plan. (c) In the case of a project for a service to be provided by or through an HMO, the office shall not deny a certificate of need with respect to the service (or otherwise make a finding that the service is not needed) in those cases (1) when the office has granted a certificate of need that authorized the development of the service, or expenditures in preparation for the offering or development (or has otherwise made a finding that the development or expenditure is needed), and when the offering of this service will be consistent with the basic objectives, time schedules, and plans of the previously approved application. However, the office may impose a limitation on the duration of the certificate of need that shall expire at the end of this time unless the health service is offered prior thereto, or (2) solely because there is an HMO of the same type in the same area, or solely because the services are not discussed in the applicable health systems plan, annual implementation plan, state health plan, or state medical facilities plan. (d) A project for a service to be provided by, or through, an HMO that is subject to review under this chapter shall remain subject to that review, unless the federal law states that an approved state program shall not require a certificate of need for the project. The office shall establish uniform procedures and criteria for approving applications under this section.


127205. (a) It is the intent of the Legislature that projects for a general acute care hospital designated as a sole community provider and licensed for less than 100 beds, projects for the establishment or expansion of skilled nursing facilities or intermediate care facilities, and projects for skilled nursing beds or intermediate care beds in health facilities other than skilled nursing or intermediate care facilities be processed as expeditiously as possible, consistent with the purposes of this chapter. (b) In reviewing an application for projects for a general acute care hospital designated as a sole community provider and licensed for less than 100 beds, a project for a skilled nursing facility, a project for an intermediate care facility, or a project for skilled nursing beds or intermediate care beds in health facilities, the office director shall consider only need, expected utilization and financial feasibility, compliance with applicable laws and regulations, and whether the proposed facility will enhance access to the population to be served. (c) The following exceptions to the procedural provisions of this chapter shall apply to applications for projects for a general acute care hospital designated as a sole community provider and licensed for less than 100 beds, projects for the establishment or expansion of skilled nursing facilities or intermediate care facilities, or a project for skilled nursing beds or intermediate care beds in health facilities other than skilled nursing or intermediate care facilities: (1) The notification of intent specified in Section 127225 shall not be required prior to the filing of an application. (2) Upon a determination that an application is complete pursuant to Section 127220, the office shall promptly publish notice in a newspaper of general circulation in the geographical area to be served by the project. The notice shall describe the project and provide that any affected person may request, in writing, that the office hold a public hearing in the course of its review. The notice shall state the address where the request shall be made and the time period when it shall be made. The written request shall be based upon the applicable review criteria and shall specify the review criteria. (3) No hearing need be held by the office in the course of its review unless ordered by the office within 30 calendar days after the application is determined to be complete. In those cases when no hearing is required to be held, the office shall, within 30 calendar days after the application is determined to be complete, issue a decision approving the project in its entirety or with modifications or conditions as have been agreed to in writing by the office and the applicant. (d) The office shall amend its regulations and application forms as may be necessary to effectuate the purposes of this section.


127210. Applicants for a certificate of need for a project specified in Section 127170 shall submit an application to the department on the official forms provided by the department, that may include, but need not be limited to, the following information: (a) The site of the facility in the geographic area to be served. (b) The population to be served, categorized by age, income, and sex, as well as projections of population growth, by age, income, and sex. (c) The anticipated demand for the health care service or services to be provided. (d) A description of the service or services to be provided. (e) Utilization of existing programs within the area to be served offering the same or similar health care services. (f) The benefit to the community that will result from the development of the project as well as the anticipated impact on other institutions offering the same or similar services in the area. (g) A schedule for the commencement and completion of the project. (h) Reasonable assurance that adequate financing is available for the completion of the project within the time period stated in the application.


127215. Each application for a certificate of need shall contain all of the information required by the office and, except as otherwise provided in this chapter, shall be accompanied by a fee. The fee shall be determined annually by regulation of the office director and shall be set forth in a schedule differentiating by type and cost of project, as determined by the office director. The office director shall establish fees so that in the aggregate they will defray costs of processing certificate of need applications that are not otherwise defrayed by the special fees charged pursuant to Section 127280. However, the application fee for a certificate of need shall not in any event exceed five thousand dollars ($5,000).


127220. (a) The office, within 15 days of its receipt of an application for a certificate of need submitted pursuant to Section 127210, shall make a determination as to whether the application is complete. If the office determines that the applicant has not submitted an application that adequately addresses the information requirements of the application form, it shall provide to the applicant a written notification of incompleteness specifying the additional information required to render the application complete. After receipt of this additional information, the office, within 15 days, shall make a determination as to whether the application is complete. (b) If, after review of additional information pursuant to subdivision (a), the office determines that the application is still incomplete, it shall provide to the applicant a written notification of incompleteness, advising the applicant of the additional information needed and the options available to the applicant to render the application complete. Following receipt of notification, the applicant shall exercise one of the following options: (1) Submit the additional information required by the office. (2) Request in writing, with or without submitting the additional information, that the review commence notwithstanding the determination of incompleteness. Upon receipt of a written statement requesting that the review commence, the application shall be deemed complete on the fifth business day following receipt unless the office determines, and notifies the applicant in writing, by the fifth business day, that the lack of information is so material that it would render meaningful analysis of the application impossible and that the application is therefore incomplete. This determination shall be based solely on the failure to provide information specifically requested by the application form. If the applicant submits the requested additional information and does not submit a written statement requesting the office to commence the review notwithstanding its determination of incompleteness, the office, within 15 days after receipt of the additional information, shall make a determination as to whether the application is complete. Upon the receipt of any additional notifications of incompleteness, the applicant shall exercise one of the options enumerated in paragraphs (1) and (2). The office, in its second or subsequent completeness inquiry, shall not request information beyond the scope of the preceding request. (c) If the office does not give the notification of incompleteness within the 15-day period required for review of completeness, the application shall be deemed complete on the 15th day following the receipt of the material submitted and the office shall then proceed with its review. (d) The office shall publish notice of the commencement of the review promptly after the application review process commences pursuant to subdivision (b) or (c). (e) A completed application may be amended or withdrawn by the applicant at any time without prejudice, but any amendment to an application, except as the office and the applicant may otherwise agree, shall cause the amended application to be treated as a new application for purposes of the time limits prescribed by this chapter and for the determination of the amount of the fee. (f) A filed application shall be a public document and shall be available for inspection at the offices of the area health planning agency and the office. A copy of any filed application shall be furnished to any person upon request and payment of a reasonable fee, to be established by the office in an amount sufficient to defray the costs of reproduction. (g) Applications filed by any state agency or the Board of Regents of the University of California shall be exempt from a filing fee.


127225. At least 20 calendar days prior to the filing of an application for a certificate of need under Section 127170, the applicant shall notify the office of its intent to apply for a certificate of need. The office may consult with the applicant on the proposed project. The office may refuse to accept a certificate-of-need application where the applicant has failed to file a notification of intent to apply for a certificate of need pursuant to this section. However, if a certificate of need is issued, it shall not be invalidated on the sole basis of failure of the applicant to notify the office within the time required by this section.


127230. The office shall transmit a copy of each application for a certificate of need determined by it to be complete, or otherwise deemed complete pursuant to Section 127220, to the appropriate area health planning agency. The area health planning agency may, at its discretion, informally review the application and provide comment on it at the public hearing held pursuant to Section 127235, if a public hearing is held. If an area health planning agency intends to provide comment on an application at a public hearing, it shall provide notice to the applicant and to the state 20 days in advance of making a comment. The comment shall be deemed to have given the area health planning agency party status.


127235. (a) Within 45 calendar days of the receipt of the complete application, or an application otherwise deemed complete pursuant to Section 127220, the office shall do one of the following: (1) Approve the application. The office may approve the application pursuant to this subdivision with modifications or conditions, provided that the applicant agrees in writing to the modifications or conditions. (2) Order a hearing if the office determines that substantial questions exist as to the eligibility of the proposed project for certificate-of-need approval. Except as otherwise provided in this section, the hearing shall be held in the health service area served by the applicant. (b) The office shall order a hearing by the service of a copy of the order on the applicant and the Office of Administrative Hearings. The order shall include the intended position of the Division of Certificate of Need of the office. Upon receipt of the order, the Office of Administrative Hearings shall promptly consult with the parties to the hearing in order to determine the time and place of hearing. Except as otherwise agreed by the parties and the Office of Administrative Hearings, the hearing shall commence within 15 days of the date of the order. Upon the scheduling of the hearing, the Office of Administrative Hearings shall promptly serve notice of the date, location, and time of the hearing upon the parties to the hearing. The Office of Administrative Hearings shall also publish a notice of the date, location, and time of the hearing in at least one newspaper of general circulation in the health service area served by the applicant. The notice shall also include the name and address of the applicant, the nature of the proposed project, and other information, deemed relevant by the Office of Administrative Hearings. (c) The hearing shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, except as otherwise provided in this chapter. The hearing shall be conducted by a hearing officer assigned by the Office of Administrative Hearings who shall rule on the admission and exclusion of evidence and may exercise all other powers relating to the conduct of the hearing. With the concurrence of the parties to the hearing, law and motion matters pertaining to the hearing may be heard by the hearing officer in a location other than the geographic location of the hearing. (d) The hearing shall conclude within 45 calendar days after commencement of the hearing unless one of the following occurs: (1) The applicant agrees to extend the time for conclusion of the hearing. (2) The hearing is ongoing and continuing during consecutive business days, in which case it shall be concluded as soon as reasonably practicable thereafter. (e) Within seven days after the conclusion of the hearing, the hearing officer shall render a proposed decision supported by findings of fact, based solely upon the record of the hearing, and conclusions of law. The proposed decision, findings of fact, and conclusions of law shall be served upon the parties to the hearing. (f) The director shall make a final decision on an application within seven calendar days after issuance of the proposed decision by the hearing officer. The decision shall either approve the application, approve it with modifications, reject it, or approve it with conditions mutually agreed upon by the applicant and the office. The failure of any applicant to fulfill the conditions under which the certificate of need was granted shall constitute grounds for revocation of the certificate of need. (g) Notice of the substance of the office's decision shall be published in a newspaper of general circulation within the health service area served by the applicant, within 10 calendar days following the decision.

127240. (a) Notwithstanding subdivision (b), (c), (d), (e), or (f) of Section 127235, if the office orders a hearing on an application, the applicant may request an informal hearing of the matter, described in this section, in lieu of, and in the alternative to, the formal procedures described in subdivisions (b), (c), (d), (e), and (f) of Section 127235. (b) If an applicant requests an informal hearing and the office concurs with the request, the office shall proceed as follows: (1) Within five calendar days after receipt of the request for an informal public hearing, the office shall order the informal public hearing by the service of a copy of the order on the applicant. The order shall include the staff report and recommendations prepared by the staff of the office. Except as otherwise agreed by the applicant and the office, the informal public hearing shall commence within 20 days of the date of the order. Upon the scheduling of the hearing, the office shall promptly serve notice of the date, location, and time of the informal public hearing upon the applicant. The office shall also publish a notice of the date, location, and time of the informal public hearing in at least one newspaper of general circulation in the health service area served by the applicant. The notice shall also include the name and address of the applicant, the nature of the proposed project, and other information deemed relevant by the office. (2) The informal public hearing shall not be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. The informal public hearing shall be conducted by an employee of the office designated by the office director. The person conducting the informal public hearing may exercise all powers relating to the conduct of the hearing, including the power to reasonably limit the length of oral presentations by any person who has been allowed to make a statement. The informal public hearing shall be conducted as follows: (A) The applicant shall be given an opportunity to present the merits of the project and to address the issues raised by the staff report and recommendations. (B) The office staff shall be given an opportunity to present their analysis of the project. (C) Other interested persons shall be given an opportunity to present written or oral statements. (D) The person conducting the informal public hearing may question any person making a written or oral statement and may give the applicant and office staff an opportunity to question any person who has made a written or oral statement. (E) The applicant and staff shall be given an opportunity to make closing statements. (F) The office shall make an audio or video recording of the hearing, and copies of the recording shall be made available at cost upon reasonable notice. However, the applicant shall have a right to bring a certified shorthand reporter to be used in place of the audio or video recording, provided that he or she provides the office with a copy of the transcript. (c) The informal public hearing shall conclude within 10 calendar days after commencement of the hearing unless one of the following occurs: (1) The applicant agrees to extend the time for conclusion of the hearing. (2) The hearing is ongoing and continuing during consecutive business days, in which case it shall be concluded as soon as reasonably practicable thereafter. (d) Within 10 days after the conclusion of the informal public hearing, the person conducting the hearing shall render a proposed decision supported by findings of fact, based solely upon the record of the hearing. The proposed decision shall be served upon the applicant and the office staff. (e) The director shall make a final decision on an application within 10 calendar days after issuance of the proposed decision. The decisions shall either approve the application, approve it with modifications, reject it, or approve it with conditions mutually agreed upon by the applicant and the office. The failure of any applicant to fulfill the conditions under which the certificate of need was granted shall constitute grounds for revocation of the certificate of need. (f) Notice of the substance of the office's decisions shall be published in a newspaper of general circulation within the health service area served by the applicant, within 10 calendar days following the decision. (g) Whether or not an informal hearing is granted shall be at the discretion of the office.


127245. (a) The undertaking of a project that requires a certificate of need, as provided in this chapter, without having first obtained a certificate of need shall (1) constitute grounds for revocation or denial of licensure, and (2) shall be deemed a violation of Section 1253. In addition, the state department may assess and collect a civil penalty from any person undertaking a project without a certificate of need. For projects requiring a certificate of need pursuant to subdivision (a) of Section 127170, the civil penalty shall not be more than five thousand dollars ($5,000). For projects requiring a certificate of need pursuant to subdivisions (b), (c), (d), or (e) of Section 127170, the civil penalty shall be two thousand five hundred dollars ($2,500) or 20 percent of the cost of the project, whichever is less. (b) A certificate of need shall expire 18 months from the date of issuance unless: (1) The certificate holder has commenced the project covered by the certificate of need and is diligently pursuing the same to completion, as determined by the state department; or (2) The duration of the certificate of need has been extended by the state department upon a showing of good cause. However, an extension shall not cumulatively exceed a period of 12 months beyond the original expiration date of the certificate of need.


127250. Any decision issued pursuant to Section 127235 shall take effect 30 calendar days following its issuance unless within that time the applicant files a petition for appeal with the Advisory Health Council. The Advisory Health Council shall render a decision on each appeal, and appeal shall be by right. The filing of a petition shall operate to suspend and stay the decision by the office pending the hearing and entry of a final decision. A petition for appeal shall be filed with the council within 30 calendar days following the date a decision is issued by the office. The petition shall be filed in the form and manner as prescribed by the office. As soon as a petition is filed, the council shall be polled and respond in writing to determine within 30 calendar days whether it will take oral argument on the petition. The council shall order a hearing if at least seven of the members certify in writing that they agree to take oral argument. If the council orders a hearing, the hearing shall be held within 60 calendar days of the date of the council's order. If a hearing is denied, a statement of the reasons for denial shall be issued by the council that shall be sent to the applicant, the office, and persons requesting the statement. The council shall cause to be published in a newspaper of general circulation in the area where the proposed project is to be located, at least 30 calendar days prior to the appeal hearing, a notice summarizing the application and the office's decision, with particulars as the council may deem necessary, including, but not limited to, the name and address of the applicant, the type of project, and the date, time and place of the appeal hearing. In addition, the council shall send copies of the notice to the applicant, the office, and any person requesting a notice. Parties to the appeals proceedings may only be the applicant and the office. Any other person shall have the right to appear and be heard at the appeal hearing, but shall not be a party to the proceedings. The appeal hearing may be held by the council or by a hearing officer, as ordered by the council. If there is a hearing officer, he or she shall rule on the admission and exclusion of evidence. The council shall exercise all other powers relating to the conduct of the hearing, but may delegate any or all powers to the hearing officer. Except as otherwise provided in this chapter, appeal hearings shall conform to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, except that the office may use its own hearing officer.


127255. Grounds for appeal pursuant to Section 127250 shall be limited to the following: (a) The office or the hearing officer violated the review procedures prescribed by this chapter. (b) The decision of the office is not supported by substantial evidence. (c) The office or hearing officer has otherwise acted in an arbitrary and capricious manner.


127260. The Advisory Health Council, upon review of a decision of the department, shall do one of the following: (a) Enter an order affirming the decision of the department where it finds as to the respective basis of review that: (1) The application was processed and the hearing conducted was consistent with this chapter, or that any inconsistency with respect thereto was immaterial to the decision of the department. (2) There is substantial evidence in the record supporting the department's decision. (3) The department has not acted in an arbitrary and capricious manner. (b) Enter an order remanding the decision of the department where it finds as to the respective basis of review that: (1) The application was not processed or the hearing conducted was not consistent with this chapter, and this inconsistency was material to the decision rendered by the department. (2) There is no substantial evidence in the record supporting the decision. (3) The department has acted in an arbitrary or capricious manner. (c) Enter an order reversing the decision of the department where it finds as to the respective basis of review that: (1) The application was not processed or the hearing conducted was not consistent with the provisions of this chapter, and this inconsistency was material to the decision rendered by the department. (2) There is no substantial evidence in the record supporting the decision. (3) The department has acted in an arbitrary or capricious manner. Orders of the council authorized by this section shall be made only upon the affirmative vote of a majority of the council, with at least six of the affirmative votes cast by the following members: (a) Representative of consumers of services for the mentally retarded appointed by the Governor. (b) Representative of consumers of mental health services appointed by the Governor. (c) Representative of local government appointed by the Governor. (d) Representatives of the general consumer public appointed by the Governor, Senate Committee on Rules, or Speaker of the Assembly. (e) Members of the Legislature appointed by the Senate Committee on Rules or Speaker of the Assembly.


127265. Where the order of the Advisory Health Council remands the decision of the department pursuant to subdivision (b) of Section 127260, the council may direct the department to reconsider the application pursuant to Section 11521 of the Government Code in the light of its order and to take further action as is specially enjoined upon it by law, but the order shall not limit or control in any way the discretion vested by law in the department. If the Advisory Health Council does not adopt a decision within 90 calendar days after the close of the hearing provided for by Section 127250, in the absence of reconsideration on the motion of the department, the decision of the department shall be final.


127270. An appellant, other than an agency of the state or the Board of Regents of the University of California, who petitions pursuant to Section 127250, shall be responsible for the actual cost to the state for the hearing officers and stenographic assistance, including reproduction of minutes and reports, connected with the appeal, as determined by the Department of General Services. However, when a decision of the department is remanded or reversed by the council, the appellant shall not be required to reimburse the costs.


127275. Judicial review of a decision of the Advisory Health Council affirming the decision of the department pursuant to subdivision (a) of Section 127260 may be had by any party to the proceedings, other than the department, as provided in Section 1094.5 of the Code of Civil Procedure. An appellant desiring to contest an adverse decision of the department need not pursue the appeal procedures prescribed by this chapter, but may elect to pursue direct judicial remedy pursuant to Section 1094.5 of the Code of Civil Procedure. The decision of the council or department shall be upheld against a claim that its findings are not supported by the evidence unless the court determines that the findings are not supported by substantial evidence.


127280. (a) Every health facility licensed pursuant to Chapter 2 (commencing with Section 1250) of Division 2, except a health facility owned and operated by the state, shall each year be charged a fee established by the office consistent with the requirements of this section. (b) Commencing in calendar year 2004, every freestanding ambulatory surgery clinic as defined in Section 128700, shall each year be charged a fee established by the office consistent with the requirements of this section. (c) The fee structure shall be established each year by the office to produce revenues equal to the appropriation made in the annual Budget Act or another statute to pay for the functions required to be performed by the office and the California Health Policy and Data Advisory Commission pursuant to this chapter, Article 2 (commencing with Section 127340) of Chapter 2, or Chapter 1 (commencing with Section 128675) of Part 5, and to pay for any other health-related programs administered by the office. The fee shall be due on July 1 and delinquent on July 31 of each year. (d) The fee for a health facility that is not a hospital, as defined in subdivision (c) of Section 128700, shall be not more than 0.035 percent of the gross operating cost of the facility for the provision of health care services for its last fiscal year that ended on or before June 30 of the preceding calendar year. (e) The fee for a hospital, as defined in subdivision (c) of Section 128700, shall be not more than 0.035 percent of the gross operating cost of the facility for the provision of health care services for its last fiscal year that ended on or before June 30 of the preceding calendar year. (f) (1) The fee for a freestanding ambulatory surgery clinic shall be established at an amount equal to the number of ambulatory surgery data records submitted to the office pursuant to Section 128737 for encounters in the preceding calendar year multiplied by not more than fifty cents ($0.50). (2) (A) For the calendar year 2004 only, a freestanding ambulatory surgery clinic shall estimate the number of records it will file pursuant to Section 128737 for the calendar year 2004 and shall report that number to the office by March 12, 2004. The estimate shall be as accurate as possible. The fee in the calendar year 2004 shall be established initially at an amount equal to the estimated number of records reported multiplied by fifty cents ($0.50) and shall be due on July 1 and delinquent on July 31, 2004. (B) The office shall compare the actual number of records filed by each freestanding clinic for the calendar year 2004 pursuant to Section 128737 with the estimated number of records reported pursuant to subparagraph (A). If the actual number reported is less than the estimated number reported, the office shall reduce the fee of the clinic for calendar year 2005 by the amount of the difference multiplied by fifty cents ($0.50). If the actual number reported exceeds the estimated number reported, the office shall increase the fee of the clinic for calendar year 2005 by the amount of the difference multiplied by fifty cents ($0.50) unless the actual number reported is greater than 120 percent of the estimated number reported, in which case the office shall increase the fee of the clinic for calendar year 2005 by the amount of the difference, up to and including 120 percent of the estimated number, multiplied by fifty cents ($0.50), and by the amount of the difference in excess of 120 percent of the estimated number multiplied by one dollar ($1). (g) There is hereby established the California Health Data and Planning Fund within the office for the purpose of receiving and expending fee revenues collected pursuant to this chapter. (h) Any amounts raised by the collection of the special fees provided for by subdivisions (d), (e), and (f) that are not required to meet appropriations in the Budget Act for the current fiscal year shall remain in the California Health Data and Planning Fund and shall be available to the office and the commission in succeeding years when appropriated by the Legislature in the annual Budget Act or another statute, for expenditure under the provisions of this chapter, Article 2 (commencing with Section 127340) of Chapter 2, and Chapter 1 (commencing with Section 128675) of Part 5, or for any other health-related programs administered by the office, and shall reduce the amount of the special fees that the office is authorized to establish and charge. (i) (1) No health facility liable for the payment of fees required by this section shall be issued a license or have an existing license renewed unless the fees are paid. A new, previously unlicensed, health facility shall be charged a pro rata fee to be established by the office during the first year of operation. (2) The license of any health facility, against which the fees required by this section are charged, shall be revoked, after notice and hearing, if it is determined by the office that the fees required were not paid within the time prescribed by subdivision (c). (j) This section shall become operative on January 1, 2002.


127280.1. Notwithstanding any other provision of law, up to two hundred thousand dollars ($200,000) of the moneys collected pursuant to Section 127280 may be used by the State Department of Health Services for data collection on, analysis of, and reporting on, maternal and perinatal outcomes, if funds are appropriated in the Budget Act.


127285. (a) Health facilities and clinics, except for chronic dialysis clinics as defined in subdivision (b) of Section 1204, shall annually report to the office all of the following information on forms supplied by the office: (1) A current inventory of beds and services. (2) Utilization data by bed type and service. (3) Acquisitions of diagnostic or therapeutic equipment during the reporting period with a value in excess of five hundred thousand dollars ($500,000). (4) Commencement of projects during the reporting period that require a capital expenditure for the facility or clinic in excess of one million dollars ($1,000,000). (b) With respect to chronic dialysis clinics, the office may annually obtain this information to the extent it is available from the Federal End Stage Renal Disease Network.


127290. (a) The department shall contract with agencies approved pursuant to Section 127155 for the purpose of providing agencies with funds to assist them to perform the duties required of them by this chapter. The Advisory Health Council shall review and make recommendations to the department upon all contracts to be entered into under this section. The department shall prepare contracts upon information submitted by agencies in the form required by the department. (b) Pending final approval by the department of the contracts, the department may advance funds to those area health planning agencies that the director determines require emergency assistance to carry out their functions under this chapter. This emergency funding authority shall expire July 1, 1977. After determining the emergency funding available to each area health planning agency, the department shall immediately notify the administrative body of each area health planning agency of the amount and the conditions governing its availability.

127295. The Legislature finds that funds available to the office, the health systems agencies, and the area health planning agencies for the implementation of this chapter may prevent the office, the health systems agencies and the area health planning agencies from fully complying with their statutorily mandated functions. In the event that the health systems agencies lose all, or substantially all, federal funding that is not replaced by other funding at a level that allows them to fulfill their major responsibilities under this chapter and in order to ensure continuity of the certificate-of-need process, the Governor is hereby authorized to request that the Secretary for Health and Human Services eliminate federal designation and funding of some or all health systems agencies located within the state and to terminate some or all duties assigned to area health system planning agencies and to assign the office to conduct some or all functions heretofore designated to the health systems agencies and area health planning agencies.


127300. Notwithstanding any other provision of law, on and after January 1, 1987, the requirement that health facilities and specialty clinics apply for, and obtain, certificates of need or certificates of exemption is indefinitely suspended.


Chapter 2. Health Policy Research And Evaluation

Article 1. Health Outcomes Reports (reserved)

Article 2. Hospitals: Community Benefits

Ca Codes (hsc:127340-127360) Health And Safety Code Section 127340-127360



127340. The Legislature finds and declares all of the following: (a) Private not-for-profit hospitals meet certain needs of their communities through the provision of essential health care and other services. Public recognition of their unique status has led to favorable tax treatment by the government. In exchange, nonprofit hospitals assume a social obligation to provide community benefits in the public interest. (b) Hospitals and the environment in which they operate have undergone dramatic changes. The pace of change will accelerate in response to health care reform. In light of this, significant public benefit would be derived if private not-for-profit hospitals reviewed and reaffirmed periodically their commitment to assist in meeting their communities' health care needs by identifying and documenting benefits provided to the communities which they serve. (c) California's private not-for-profit hospitals provide a wide range of benefits to their communities in addition to those reflected in the financial data reported to the state. (d) Unreported community benefits that are often provided but not otherwise reported include, but are not limited to, all of the following: (1) Community-oriented wellness and health promotion. (2) Prevention services, including, but not limited to, health screening, immunizations, school examinations, and disease counseling and education. (3) Adult day care. (4) Child care. (5) Medical research. (6) Medical education. (7) Nursing and other professional training. (8) Home-delivered meals to the homebound. (9) Sponsorship of free food, shelter, and clothing to the homeless. (10) Outreach clinics in socioeconomically depressed areas. (e) Direct provision of goods and services, as well as preventive programs, should be emphasized by hospitals in the development of community benefit plans.

127345. As used in this article, the following terms have the following meanings: (a) "Community benefits plan" means the written document prepared for annual submission to the Office of Statewide Health Planning and Development that shall include, but shall not be limited to, a description of the activities that the hospital has undertaken in order to address identified community needs within its mission and financial capacity, and the process by which the hospital developed the plan in consultation with the community. (b) "Community" means the service areas or patient populations for which the hospital provides health care services. (c) Solely for the planning and reporting purposes of this article, "community benefit" means a hospital's activities that are intended to address community needs and priorities primarily through disease prevention and improvement of health status, including, but not limited to, any of the following: (1) Health care services, rendered to vulnerable populations, including, but not limited to, charity care and the unreimbursed cost of providing services to the uninsured, underinsured, and those eligible for Medi-Cal, Medicare, California Childrens Services Program, or county indigent programs. (2) The unreimbursed cost of services included in subdivision (d) of Section 127340. (3) Financial or in-kind support of public health programs. (4) Donation of funds, property, or other resources that contribute to a community priority. (5) Health care cost containment. (6) Enhancement of access to health care or related services that contribute to a healthier community. (7) Services offered without regard to financial return because they meet a community need in the service area of the hospital, and other services including health promotion, health education, prevention, and social services. (8) Food, shelter, clothing, education, transportation, and other goods or services that help maintain a person's health. (d) "Community needs assessment" means the process by which the hospital identifies, for its primary service area as determined by the hospital, unmet community needs. (e) "Community needs" means those requisites for improvement or maintenance of health status in the community. (f) "Hospital" means a private not-for-profit acute hospital licensed under subdivision (a), (b), or (f) of Section 1250 and is owned by a corporation that has been determined to be exempt from taxation under the United States Internal Revenue Code. "Hospital" does not mean any of the following: (1) Hospitals that are dedicated to serving children and that do not receive direct payment for services to any patient. (2) Small and rural hospitals as defined in Section 124840. (g) "Mission statement" means a hospital's primary objectives for operation as adopted by its governing body. (h) "Vulnerable populations" means any population that is exposed to medical or financial risk by virtue of being uninsured, underinsured, or eligible for Medi-Cal, Medicare, California Childrens Services Program, or county indigent programs.


127350. Each hospital shall do all of the following: (a) By July 1, 1995, reaffirm its mission statement that requires its policies integrate and reflect the public interest in meeting its responsibilities as a not-for-profit organization. (b) By January 1, 1996, complete, either alone, in conjunction with other health care providers, or through other organizational arrangements, a community needs assessment evaluating the health needs of the community serviced by the hospital, that includes, but is not limited to, a process for consulting with community groups and local government officials in the identification and prioritization of community needs that the hospital can address directly, in collaboration with others, or through other organizational arrangement. The community needs assessment shall be updated at least once every three years. (c) By April 1, 1996, and annually thereafter adopt and update a community benefits plan for providing community benefits either alone, in conjunction with other health care providers, or through other organizational arrangements. (d) Annually submit its community benefits plan, including, but not limited to, the activities that the hospital has undertaken in order to address community needs within its mission and financial capacity to the Office of Statewide Health Planning and Development. The hospital shall, to the extent practicable, assign and report the economic value of community benefits provided in furtherance of its plan. Effective with hospital fiscal years, beginning on or after January 1, 1996, each hospital shall file a copy of the plan with the office not later than 150 days after the hospital's fiscal year ends. The reports filed by the hospitals shall be made available to the public by the office. Hospitals under the common control of a single corporation or another entity may file a consolidated report.


127355. The hospital shall include all of the following elements in its community benefits plan: (a) Mechanisms to evaluate the plan's effectiveness including, but not limited to, a method for soliciting the views of the community served by the hospital and identification of community groups and local government officials consulted during the development of the plan. (b) Measurable objectives to be achieved within specified timeframes. (c) Community benefits categorized into the following framework: (1) Medical care services. (2) Other benefits for vulnerable populations. (3) Other benefits for the broader community. (4) Health research, education, and training programs. (5) Nonquantifiable benefits.


127360. Nothing in this article shall be construed to authorize or require specific formats for hospital needs assessments, community benefit plans, or reports until recommendations pursuant to former Section 127365, as added by Chapter 1023 of the Statutes of 1996, are considered and enacted by the Legislature. Nothing in this article shall be used to justify the tax-exempt status of a hospital under state law. Nothing in this article shall preclude the office from requiring hospitals to directly report their charity activities.


Chapter 2.5. Fair Pricing Policies

Article 1. Hospital Fair Pricing Policies

Ca Codes (hsc:127400-127446) Health And Safety Code Section 127400-127446



127400. As used in this article, the following terms have the following meanings: (a) "Allowance for financially qualified patient" means, with respect to services rendered to a financially qualified patient, an allowance that is applied after the hospital's charges are imposed on the patient, due to the patient's determined financial inability to pay the charges. (b) "Federal poverty level" means the poverty guidelines updated periodically in the Federal Register by the United States Department of Health and Human Services under authority of subsection (2) of Section 9902 of Title 42 of the United States Code. (c) "Financially qualified patient" means a patient who is both of the following: (1) A patient who is a self-pay patient, as defined in subdivision (f) or a patient with high medical costs, as defined in subdivision (g). (2) A patient who has a family income that does not exceed 350 percent of the federal poverty level. (d) "Hospital" means a facility that is required to be licensed under subdivision (a), (b), or (f) of Section 1250, except a facility operated by the State Department of Mental Health or the Department of Corrections and Rehabilitation. (e) "Office" means the Office of Statewide Health Planning and Development. (f) "Self-pay patient" means a patient who does not have third-party coverage from a health insurer, health care service plan, Medicare, or Medicaid, and whose injury is not a compensable injury for purposes of workers' compensation, automobile insurance, or other insurance as determined and documented by the hospital. Self-pay patients may include charity care patients. (g) "A patient with high medical costs" means a person whose family income does not exceed 350 percent of the federal poverty level, as defined in subdivision (b), if that individual does not receive a discounted rate from the hospital as a result of his or her third-party coverage. For these purposes, "high medical costs" means any of the following: (1) Annual out-of-pocket costs incurred by the individual at the hospital that exceed 10 percent of the patient's family income in the prior 12 months. (2) Annual out-of-pocket expenses that exceed 10 percent of the patient's family income, if the patient provides documentation of the patient's medical expenses paid by the patient or the patient's family in the prior 12 months. (3) A lower level determined by the hospital in accordance with the hospital's charity care policy. (h) "Patient's family" means the following: (1) For persons 18 years of age and older, spouse, domestic partner, as defined in Section 297 of the Family Code, and dependent children under 21 years of age, whether living at home or not. (2) For persons under 18 years of age, parent, caretaker relatives, and other children under 21 years of age of the parent or caretaker relative.


127401. Each general acute care hospital licensed pursuant to subdivision (a) of Section 1250 shall comply with the provisions of this article as a condition of licensure. The State Department of Health Services shall be responsible for the enforcement of these provisions.


127405. (a) (1) (A) Each hospital shall maintain an understandable written policy regarding discount payments for financially qualified patients as well as an understandable written charity care policy. Uninsured patients or patients with high medical costs who are at or below 350 percent of the federal poverty level, as defined in subdivision (b) of Section 127400, shall be eligible to apply for participation under a hospital's charity care policy or discount payment policy. Notwithstanding any other provision of this article, a hospital may choose to grant eligibility for its discount payment policy or charity care policies to patients with incomes over 350 percent of the federal poverty level. Both the charity care policy and the discount payment policy shall state the process used by the hospital to determine whether a patient is eligible for charity care or discounted payment. In the event of a dispute, a patient may seek review from the business manager, chief financial officer, or other appropriate manager as designated in the charity care policy and the discount payment policy. (B) The written policy regarding discount payments shall also include a statement that an emergency physician, as defined in Section 127450, who provides emergency medical services in a hospital that provides emergency care is also required by law to provide discounts to uninsured patients or patients with high medical costs who are at or below 350 percent of the federal poverty level. This statement shall not be construed to impose any additional responsibilities upon the hospital. (2) Rural hospitals, as defined in Section 124840, may establish eligibility levels for financial assistance and charity care at less than 350 percent of the federal poverty level as appropriate to maintain their financial and operational integrity. (b) A hospital's discount payment policy shall clearly state eligibility criteria based upon income consistent with the application of the federal poverty level. The discount payment policy shall also include an extended payment plan to allow payment of the discounted price over time. The policy shall provide that the hospital and the patient may negotiate the terms of the payment plan. (c) The charity care policy shall state clearly the eligibility criteria for charity care. In determining eligibility under its charity care policy, a hospital may consider income and monetary assets of the patient. For purposes of this determination, monetary assets shall not include retirement or deferred compensation plans qualified under the Internal Revenue Code, or nonqualified deferred compensation plans. Furthermore, the first ten thousand dollars ($10,000) of a patient's monetary assets shall not be counted in determining eligibility, nor shall 50 percent of a patient's monetary assets over the first ten thousand dollars ($10,000) be counted in determining eligibility. (d) A hospital shall limit expected payment for services it provides to a patient at or below 350 percent of the federal poverty level, as defined in subdivision (b) of Section 124700, eligible under its discount payment policy to the amount of payment the hospital would expect, in good faith, to receive for providing services from Medicare, Medi-Cal, Healthy Families, or another government-sponsored health program of health benefits in which the hospital participates, whichever is greater. If the hospital provides a service for which there is no established payment by Medicare or any other government-sponsored program of health benefits in which the hospital participates, the hospital shall establish an appropriate discounted payment. (e) A patient, or patient's legal representative, who requests a discounted payment, charity care, or other assistance in meeting his or her financial obligation to the hospital shall make every reasonable effort to provide the hospital with documentation of income and health benefits coverage. If the person requests charity care or a discounted payment and fails to provide information that is reasonable and necessary for the hospital to make a determination, the hospital may consider that failure in making its determination. (1) For purposes of determining eligibility for discounted payment, documentation of income shall be limited to recent pay stubs or income tax returns. (2) For purposes of determining eligibility for charity care, documentation of assets may include information on all monetary assets, but shall not include statements on retirement or deferred compensation plans qualified under the Internal Revenue Code, or nonqualified deferred compensation plans. A hospital may require waivers or releases from the patient or the patient's family, authorizing the hospital to obtain account information from financial or commercial institutions, or other entities that hold or maintain the monetary assets, to verify their value. (3) Information obtained pursuant to paragraph (1) or (2) shall not be used for collections activities. This paragraph does not prohibit the use of information obtained by the hospital, collection agency, or assignee independently of the eligibility process for charity care or discounted payment. (4) Eligibility for discounted payments or charity care may be determined at any time the hospital is in receipt of information specified in paragraph (1) or (2), respectively.


127410. (a) Each hospital shall provide patients with a written notice that shall contain information about availability of the hospital's discount payment and charity care policies, including information about eligibility, as well as contact information for a hospital employee or office from which the person may obtain further information about these policies. This written notice shall be provided in addition to the estimate provided pursuant to Section 1339.585. The notice shall also be provided to patients who receive emergency or outpatient care and who may be billed for that care, but who were not admitted. The notice shall be provided in English, and in languages other than English. The languages to be provided shall be determined in a manner similar to that required pursuant to Section 12693.30 of the Insurance Code. Written correspondence to the patient required by this article shall also be in the language spoken by the patient, consistent with Section 12693.30 of the Insurance Code and applicable state and federal law. (b) Notice of the hospital's policy for financially qualified and self-pay patients shall be clearly and conspicuously posted in locations that are visible to the public, including, but not limited to, all of the following: (1) Emergency department, if any. (2) Billing office. (3) Admissions office. (4) Other outpatient settings.


127420. (a) Each hospital shall make all reasonable efforts to obtain from the patient or his or her representative information about whether private or public health insurance or sponsorship may fully or partially cover the charges for care rendered by the hospital to a patient, including, but not limited to, any of the following: (1) Private health insurance. (2) Medicare. (3) The Medi-Cal program, the Healthy Families Program, the California Childrens' Services Program, or other state-funded programs designed to provide health coverage. (b) If a hospital bills a patient who has not provided proof of coverage by a third party at the time the care is provided or upon discharge, as a part of that billing, the hospital shall provide the patient with a clear and conspicuous notice that includes all of the following: (1) A statement of charges for services rendered by the hospital. (2) A request that the patient inform the hospital if the patient has health insurance coverage, Medicare, Healthy Families, Medi-Cal, or other coverage. (3) A statement that if the consumer does not have health insurance coverage, the consumer may be eligible for Medicare, Healthy Families, Medi-Cal, California Childrens' Services Program, or charity care. (4) A statement indicating how patients may obtain applications for the Medi-Cal program and the Healthy Families Program and that the hospital will provide these applications. If the patient does not indicate coverage by a third-party payer specified in subdivision (a), or requests a discounted price or charity care then the hospital shall provide an application for the Medi-Cal program, the Healthy Families Program or other governmental program to the patient. This application shall be provided prior to discharge if the patient has been admitted or to patients receiving emergency or outpatient care. (5) Information regarding the financially qualified patient and charity care application, including the following: (A) A statement that indicates that if the patient lacks, or has inadequate, insurance, and meets certain low- and moderate-income requirements, the patient may qualify for discounted payment or charity care. (B) The name and telephone number of a hospital employee or office from whom or which the patient may obtain information about the hospital's discount payment and charity care policies, and how to apply for that assistance.


127425. (a) Each hospital shall have a written policy about when and under whose authority patient debt is advanced for collection, whether the collection activity is conducted by the hospital, an affiliate or subsidiary of the hospital, or by an external collection agency. (b) Each hospital shall establish a written policy defining standards and practices for the collection of debt, and shall obtain a written agreement from any agency that collects hospital receivables that it will adhere to the hospital's standards and scope of practices. The policy shall not conflict with other applicable laws and shall not be construed to create a joint venture between the hospital and the external entity, or otherwise to allow hospital governance of an external entity that collects hospital receivables. In determining the amount of a debt a hospital may seek to recover from patients who are eligible under the hospital's charity care policy or discount payment policy, the hospital may consider only income and monetary assets as limited by Section 127405. (c) At time of billing, each hospital shall provide a written summary consistent with Section 127410, which includes the same information concerning services and charges provided to all other patients who receive care at the hospital. (d) For a patient that lacks coverage, or for a patient that provides information that he or she may be a patient with high medical costs, as defined in this article, a hospital, any assignee of the hospital, or other owner of the patient debt, including a collection agency, shall not report adverse information to a consumer credit reporting agency or commence civil action against the patient for nonpayment at any time prior to 150 days after initial billing. (e) If a patient is attempting to qualify for eligibility under the hospital's charity care or discount payment policy and is attempting in good faith to settle an outstanding bill with the hospital by negotiating a reasonable payment plan or by making regular partial payments of a reasonable amount, the hospital shall not send the unpaid bill to any collection agency or other assignee, unless that entity has agreed to comply with this article. (f) (1) The hospital or other assignee which is an affiliate or subsidiary of the hospital shall not, in dealing with patients eligible under the hospital's charity care or discount payment policies, use wage garnishments or liens on primary residences as a means of collecting unpaid hospital bills. (2) A collection agency or other assignee that is not a subsidiary or affiliate of the hospital shall not, in dealing with any patient under the hospital's charity care or discount payment policies, use as a means of collecting unpaid hospital bills, any of the following: (A) A wage garnishment, except by order of the court upon noticed motion, supported by a declaration filed by the movant identifying the basis for which it believes that the patient has the ability to make payments on the judgment under the wage garnishment, which the court shall consider in light of the size of the judgment and additional information provided by the patient prior to, or at, the hearing concerning the patient's ability to pay, including information about probable future medical expenses based on the current condition of the patient and other obligations of the patient. (B) Notice or conduct a sale of the patient's primary residence during the life of the patient or his or her spouse, or during the period a child of the patient is a minor, or a child of the patient who has attained the age of majority is unable to take care of himself or herself and resides in the dwelling as his or her primary residence. In the event a person protected by this paragraph owns more than one dwelling, the primary residence shall be the dwelling that is the patient's current homestead, as defined in Section 704.710 of the Code of Civil Procedure or was the patient's homestead at the time of the death of a person other than the patient who is asserting the protections of this paragraph. (3) This requirement does not preclude a hospital, collection agency, or other assignee from pursuing reimbursement and any enforcement remedy or remedies from third-party liability settlements, tortfeasors, or other legally responsible parties. (g) Any extended payment plans offered by a hospital to assist patients eligible under the hospital's charity care policy, discount payment policy, or any other policy adopted by the hospital for assisting low-income patients with no insurance or high medical costs in settling outstanding past due hospital bills, shall be interest free. The hospital extended payment plan may be declared no longer operative after the patient's failure to make all consecutive payments due during a 90-day period. Before declaring the hospital extended payment plan no longer operative, the hospital, collection agency, or assignee shall make a reasonable attempt to contact the patient by phone and, to give notice in writing, that the extended payment plan may become inoperative, and of the opportunity to renegotiate the extended payment plan. Prior to the hospital extended payment plan being declared inoperative, the hospital, collection agency, or assignee shall attempt to renegotiate the terms of the defaulted extended payment plan, if requested by the patient. The hospital, collection agency, or assignee shall not report adverse information to a consumer credit reporting agency or commence a civil action against the patient or responsible party for nonpayment prior to the time the extended payment plan is declared to be no longer operative. For purposes of this section, the notice and phone call to the patient may be made to the last known phone number and address of the patient. (h) Nothing in this section shall be construed to diminish or eliminate any protections consumers have under existing federal and state debt collection laws, or any other consumer protections available under state or federal law. If the patient fails to make all consecutive payments for 90 days and fails to renegotiate a payment plan, this subdivision does not limit or alter the obligation of the patient to make payments on the obligation owing to the hospital pursuant to any contract or applicable statute from the date that the extended payment plan is declared no longer operative, as set forth in subdivision (g).

127426. (a) The period described in Section 127425 shall be extended if the patient has a pending appeal for coverage of the services, until a final determination of that appeal is made, if the patient makes a reasonable effort to communicate with the hospital about the progress of any pending appeals. (b) For purposes of this section, "pending appeal" includes any of the following: (1) A grievance against a contracting health care service plan, as described in Chapter 2.2 (commencing with Section 1340) of Division 2, or against an insurer, as described in Chapter 1 (commencing with Section 10110) of Part 2 of Division 2 of the Insurance Code. (2) An independent medical review, as described in Section 10145.3 or 10169 of the Insurance Code. (3) A fair hearing for a review of a Medi-Cal claim pursuant to Section 10950 of the Welfare and Institutions Code. (4) An appeal regarding Medicare coverage consistent with federal law and regulations.


127430. (a) Prior to commencing collection activities against a patient, the hospital, any assignee of the hospital, or other owner of the patient debt, including a collection agency, shall provide the patient with a clear and conspicuous written notice containing both of the following: (1) A plain language summary of the patient's rights pursuant to this article, the Rosenthal Fair Debt Collection Practices Act (Title 1.6C (commencing with Section 1788) of Part 4 of Division 3 of the Civil Code), and the federal Fair Debt Collection Practices Act (Subchapter V (commencing with Section 1692) of Chapter 41 of Title 15 of the United States Code). The summary shall include a statement that the Federal Trade Commission enforces the federal act. The summary shall be sufficient if it appears in substantially the following form: "State and federal law require debt collectors to treat you fairly and prohibit debt collectors from making false statements or threats of violence, using obscene or profane language, and making improper communications with third parties, including your employer. Except under unusual circumstances, debt collectors may not contact you before 8:00 a.m. or after 9:00 p.m. In general, a debt collector may not give information about your debt to another person, other than your attorney or spouse. A debt collector may contact another person to confirm your location or to enforce a judgment. For more information about debt collection activities, you may contact the Federal Trade Commission by telephone at 1-877-FTC-HELP (382-4357) or online at www.ftc.gov." (2) A statement that nonprofit credit counseling services may be available in the area. (b) The notice required by subdivision (a) shall also accompany any document indicating that the commencement of collection activities may occur. (c) The requirements of this section shall apply to the entity engaged in the collection activities. If a hospital assigns or sells the debt to another entity, the obligations shall apply to the entity, including a collection agency, engaged in the debt collection activity.


127435. Each hospital shall provide to the office a copy of its discount payment policy, charity care policy, eligibility procedures for those policies, review process, and the application for charity care or discounted payment programs. The office may determine whether the information is to be provided electronically or in some other manner. The information shall be provided at least biennially on January 1, or when a significant change is made. If no significant change has been made by the hospital since the information was previously provided, notifying the office of the lack of change shall meet the requirements of this section. The office shall make this information available to the public.


127440. The hospital shall reimburse the patient or patients any amount actually paid in excess of the amount due under this article, including interest. Interest owed by the hospital to the patient shall accrue at the rate set forth in Section 685.010 of the Code of Civil Procedure, beginning on the date payment by the patient is received by the hospital. However, a hospital is not required to reimburse the patient or pay interest if the amount due is less than five dollars ($5.00). The hospital shall give the patient a credit for the amount due for at least 60 days from the date the amount is due.

127443. The rights, remedies, and penalties established by this article are cumulative, and shall not supersede the rights, remedies, or penalties established under other laws.


127444. Nothing in this article shall be construed to prohibit a hospital from uniformly imposing charges from its established charge schedule or published rates, nor shall this article preclude the recognition of a hospital's established charge schedule or published rates for purposes of applying any payment limit, interim payment amount, or other payment calculation based upon a hospital's rates or charges under the Medi-Cal program, the Medicare Program, workers' compensation, or other federal, state, or local public program of health benefits. No health care service plan, insurer, or any other person shall reduce the amount it would otherwise reimburse a claim for hospital services because a hospital has waived, or will waive, collection of all or a portion of a patient's bill for hospital services in accordance with the hospital's charity care or discount payment policy, notwithstanding any contractual provision.


127445. Notwithstanding any other provision of law, the amounts paid by parties for services resulting from reduced or waived charges under a hospital's discounted payment or charity care policy shall not constitute a hospital's uniform, published, prevailing, or customary charges, its usual fees to the general public, or its charges to non-Medi-Cal purchasers under comparable circumstances, and shall not be used to calculate a hospital's median non-Medicare or Medi-Cal charges, for purposes of any payment limit under the federal Medicare Program, the Medi-Cal program, or any other federal or state-financed health care program.

127446. To the extent that any requirement of Section 127400, 127401, or 127405 results in a federal determination that a hospital' s established charge schedule or published rates are not the hospital' s customary or prevailing charges for services, the requirement in question shall be inoperative for all general acute care hospitals, including, but not limited to, a hospital that is licensed to and operated by a county or a hospital authority established pursuant to Section 101850. The State Department of Public Health shall seek federal guidance regarding modifications to the requirement in question. All other requirements of this article shall remain in effect.


Article 2. Emergency Physician Fair Pricing Policies

Ca Codes (hsc:127450-127462) Health And Safety Code Section 127450-127462



127450. As used in this article, the following terms have the following meanings: (a) "Allowance for financially qualified patient" means, with respect to emergency care rendered to a financially qualified patient, an allowance that is applied after the emergency physician's charges are imposed on the patient, due to the patient's determined financial inability to pay the charges. (b) "Emergency care" means emergency medical services and care, as defined in Section 1317.1, that is provided by an emergency physician in the emergency department of a hospital. (c) "Emergency physician" means a physician and surgeon licensed pursuant to Chapter 2 (commencing with Section 2000) of the Business and Professions Code who is credentialed by a hospital and either employed or contracted by the hospital to provide emergency medical services in the emergency department of the hospital, except that an "emergency physician" shall not include a physician specialist who is called into the emergency department of a hospital or who is on staff or has privileges at the hospital outside of the emergency department. (d) "Federal poverty level" means the poverty guidelines updated periodically in the Federal Register by the United States Department of Health and Human Services under authority of subsection (2) of Section 9902 of Title 42 of the United States Code. (e) "Financially qualified patient" means a patient who is both of the following: (1) A patient who is a self-pay patient or a patient with high medical costs. (2) A patient who has a family income that does not exceed 350 percent of the federal poverty level. (f) "Hospital" means a facility that is required to be licensed under subdivision (a) of Section 1250, except a facility operated by the State Department of Mental Health or the Department of Corrections and Rehabilitation. (g) "Office" means the Office of Statewide Health Planning and Development. (h) "Self-pay patient" means a patient who does not have third-party coverage from a health insurer, health care service plan, Medicare, or Medicaid, and whose injury is not a compensable injury for purposes of workers' compensation, automobile insurance, or other insurance as determined and documented by the emergency physician. Self-pay patients may include charity care patients. (i) "A patient with high medical costs" means a person whose family income does not exceed 350 percent of the federal poverty level if that individual does not receive a discounted rate from the emergency physician as a result of his or her third-party coverage. For these purposes, "high medical costs" means any of the following: (1) Annual out-of-pocket costs incurred by the individual at the hospital that provided emergency care that exceed 10 percent of the patient's family income in the prior 12 months. (2) Annual out-of-pocket expenses that exceed 10 percent of the patient's family income, if the patient provides documentation of the patient's medical expenses paid by the patient or the patient's family in the prior 12 months. The emergency physician may waive the request for documentation. (3) A lower level determined by the emergency physician in accordance with the emergency physician's discounted payment policy. (j) "Patient's family" means the following: (1) For persons 18 years of age and older, spouse, domestic partner, as defined in Section 297 of the Family Code, and dependent children under 21 years of age, whether living at home or not. (2) For persons under 18 years of age, parent, caretaker relatives, and other children under 21 years of age of the parent or caretaker relative.

127451. A violation of this article shall not constitute a violation of the terms of a physician and surgeon's licensure.


127452. (a) Uninsured patients or patients with high medical costs who are at or below 350 percent of the federal poverty level shall be eligible to apply to an emergency physician for a discount payment pursuant to a discount payment policy. Notwithstanding any other provision of this article, an emergency physician may choose to grant eligibility for a discount payment policy to patients with incomes over 350 percent of the federal poverty level. (b) An emergency physician shall limit expected payment for services provided to a patient at or below 350 percent of the federal poverty level and who is eligible under the emergency physician's discount payment policy to an amount that is no greater than 50 percent of the median of billed charges based on a nationally recognized database of physician and surgeon charges until the nonprofit FAIR Health, Inc. creates a database that makes available the rate of payment received by physician and surgeons from commercial insurers for the same services in the same or similar geographic region. When FAIR Health, Inc. makes available the rate of payment received by physicians and surgeons from commercial insurers for the same services in the same or similar geographic region, the amount of expected payment under this section shall be no greater than the median or average of rates paid by commercial insurers for the same or similar services in the same or similar geographic region. (c) (1) If an emergency physician seeks reimbursement from the Maddy Fund pursuant to Section 1797.98c, then the emergency physician shall, at that time, cease any further billing or collection activity for that patient. (2) If the emergency physician does not receive reimbursement from the Maddy Fund after attempting to obtain reimbursement from the Maddy Fund, then the provisions of this article shall apply. (3) If the emergency physician does not attempt to seek reimbursement from the Maddy Fund, the provisions of this article shall apply. (d) A patient, or patient's legal representative, who requests a discounted payment or other assistance in meeting his or her financial obligation to the emergency physician shall make every reasonable effort to provide the emergency physician with documentation of income and health benefits coverage, if the emergency physician requests the documentation. If the patient, or the patient's legal representative, requests a discounted payment and fails to provide information that is reasonable and necessary for the emergency physician to make a determination, the emergency physician may consider that failure in making its determination. (1) For purposes of determining eligibility for discounted payment, the emergency physician may rely on the determination made by the hospital at which emergency care was provided. If the emergency physician chooses to make a separate determination of eligibility for discounted payment, documentation of income shall be limited to recent pay stubs or income tax returns. The emergency physician, at his or her discretion, may accept self-attestation by a patient, or a patient's legal representative, but shall not request documentation of income other than that authorized in this paragraph. (2) Information obtained pursuant to paragraph (1) shall not be used for collections activities. This paragraph does not prohibit the use of information obtained by the emergency physician, collection agency, or assignee independent of the eligibility process for discounted payment. (3) Eligibility for discounted payments may be determined at any time the emergency physician is in receipt of information specified in paragraph (1) or (2), respectively.


127454. (a) Each emergency physician shall make all reasonable efforts to obtain from the patient, or his or her representative, information about whether private or public health insurance or sponsorship may fully or partially cover the charges for emergency care rendered by the emergency physician to a patient, including, but not limited to, any of the following: (1) Private health insurance. (2) Medicare. (3) The Medi-Cal program, the Healthy Families Program, the California Children's Services Program, or other publicly funded programs designed to provide comprehensive health coverage. (b) If the emergency physician or his or her representative bills a patient who has not provided proof of coverage by a third party at the time the care is provided or upon discharge, as a part of that billing, the emergency physician shall provide the patient with a clear and conspicuous notice that includes all of the following: (1) A statement of charges for services rendered by the emergency physician. (2) A request that the patient inform the emergency physician if the patient has health insurance coverage, Medicare, Healthy Families, Medi-Cal, or other coverage. (3) A statement that if the consumer does not have health insurance coverage, the consumer may be eligible for Medicare, Healthy Families, Medi-Cal, California Children's Services Program, or discounted payment care. (4) Information regarding the financially qualified patient and discounted payment application, including the following: (A) A statement that indicates that if the patient lacks, or has inadequate, insurance, and meets certain low-and moderate-income requirements, the patient may qualify for discounted payment. (B) The name and telephone number of the emergency physician's employee or office from whom or which the patient may obtain information about the emergency physician's discount payment policy, and how to apply for that assistance. (c) (1) In addition to the statement of the charges, if the emergency physician's uses the following notice in any billing, that emergency physician shall be deemed to have complied with the notice requirements of this section: "If you are uninsured or have high medical costs, please contact ____ (name of person responsible for discount payment policy) at ____ (area code and phone number) for information on discounts and programs for which you may be eligible, including the Medi-Cal program. If you have coverage, please tell us so that we may bill your plan." (2) If the emergency physician or the assignee of the emergency physician lacks the capacity to provide the notice specified in paragraph (1), the emergency physician or his or her assignee shall be deemed to have complied with the notice requirements of this section if the information required under this section is provided upon request and if the following is printed on the bill in 14-point bold type: "If uninsured or high medical bill, call re: discount."


127455. (a) Each emergency physician shall have a written policy about when and under whose authority patient debt is advanced for collection. (b) Each emergency physician shall establish a written policy defining standards and practices for the collection of debt, and shall obtain a written agreement from any agency that collects emergency physician receivables that it will adhere to the emergency physician's standards and scope of practice. The policy shall not conflict with other applicable laws and shall not be construed to create a joint venture between the emergency physician and the external entity, or otherwise to allow physician and surgeon governance of an external entity that collects physician and surgeon receivables. In determining the amount of a debt the emergency physician may seek to recover from patients who are eligible under the emergency physician's charity care policy or discount payment policy, the emergency physician may consider only income and monetary assets as limited by Section 127452. (c) For a patient that lacks coverage, or for a patient that provides information that he or she may be a patient with high medical costs, the emergency physician, any assignee of the emergency physician, or other owner of the patient debt, including a collection agency, shall not report adverse information to a consumer credit reporting agency or commence civil action against the patient for nonpayment at any time prior to 150 days after initial billing. (d) If a patient is attempting to qualify for eligibility under the emergency physician's discount payment policy and is attempting in good faith to settle an outstanding bill with the physician and surgeon by negotiating a reasonable payment plan or by making regular partial payments of a reasonable amount, the emergency physician or his or her assignee, including a collection agency, shall not report adverse information to a consumer credit agency or commence a civil action unless that entity has agreed to comply with this article. (e) (1) The emergency physician or other assignee shall not, in dealing with patients eligible under the emergency physician's discount payment policies, use wage garnishments or liens on primary residences as a means of collecting unpaid emergency physician bills. (2) A collection agency or other assignee shall not, in dealing with any patient under the emergency physician's discount payment policy, use as a means of collecting unpaid emergency physician bills, any of the following: (A) A wage garnishment, except by order of the court upon noticed motion, supported by a declaration filed by the movant identifying the basis for its belief that the patient has the ability to make payments on the judgment under the wage garnishment, that the court shall consider in light of the size of the judgment and additional information provided by the patient prior to, or at, the hearing concerning the patient's ability to pay, including information about probable future medical expenses based on the current condition of the patient and other obligations of the patient. (B) Notice or conduct a sale of the patient's primary residence during the life of the patient or his or her spouse, or during the period a child of the patient is a minor, or a child of the patient who has attained the age of majority is unable to take care of himself or herself and resides in the dwelling as his or her primary residence. In the event a person protected by this paragraph owns more than one dwelling, the primary residence shall be the dwelling that is the patient's current homestead, as defined in Section 704.710 of the Code of Civil Procedure or was the patient's homestead at the time of the death of a person other than the patient who is asserting the protections of this paragraph. (3) This requirement does not preclude the emergency physician, collection agency, or other assignee from pursuing reimbursement and any enforcement remedy or remedies from third-party liability settlements, tortfeasors, or other legally responsible parties. (f) Any extended payment plans offered by an emergency physician to assist patients eligible under the emergency physician's discount payment policy or any other policy adopted by the emergency physician for assisting low-income patients with no insurance or high medical costs in settling outstanding past due emergency physician bills, shall be interest free. The emergency physician's extended payment plan may be declared no longer operative after the patient's failure to make all consecutive payments due during a 90-day period. Before declaring the emergency physician's extended payment plan no longer operative, the emergency physician, collection agency, or assignee shall make a reasonable attempt to contact the patient by telephone, if the telephone number is known, and to give notice in writing that the extended payment plan may become inoperative, and of the opportunity to renegotiate the extended payment plan. Prior to the emergency physician's extended payment plan being declared inoperative, the emergency physician, collection agency, or assignee shall attempt to renegotiate the terms of the defaulted extended payment plan, if requested by the patient. The emergency physician, collection agency, or assignee shall not report adverse information to a consumer credit reporting agency or commence a civil action against the patient or responsible party for nonpayment prior to the time the extended payment plan is declared to be no longer operative. For purposes of this section, the notice and telephone call to the patient may be made to the last known telephone number and address of the patient. (g) Nothing in this section shall be construed to diminish or eliminate any protections consumers have under existing federal and state debt collection laws, or any other consumer protections available under state or federal law. If the patient fails to make all consecutive payments for 90 days and fails to renegotiate a payment plan, this subdivision does not limit or alter the obligation of the patient to make payments on the obligation owing to the emergency physician pursuant to any contract or applicable statute from the date that the extended payment plan is declared no longer operative, as set forth in subdivision (f).


127456. (a) The period described in Section 127455 shall be extended if the patient has a pending appeal for coverage of the services, until a final determination of that appeal is made, if the patient makes a reasonable effort to communicate with the emergency physician about the progress of any pending appeals. (b) For purposes of this section, "pending appeal" includes any of the following: (1) A grievance against a contracting health care service plan, as described in Chapter 2.2 (commencing with Section 1340) of Division 2, or against an insurer, as described in Chapter 1 (commencing with Section 10110) of Part 2 of Division 2 of the Insurance Code. (2) An independent medical review, as described in Section 10145.3 or 10169 of the Insurance Code. (3) A fair hearing for a review of a Medi-Cal claim pursuant to Section 10950 of the Welfare and Institutions Code. (4) An appeal regarding Medicare coverage consistent with federal law and regulations.


127457. (a) After the period described in Section 127455, and upon the completion of appeals consistent with Section 127456, prior to commencing further collection activities against a patient, the emergency physician, any assignee of the emergency physician, or other owner of the patient debt, including a collection agency, shall not report adverse information to a consumer credit reporting agency or commence a civil action, until after the patient has been provided with a clear and conspicuous written notice containing both of the following: (1) A plain language summary of the patient's rights pursuant to this article, the Rosenthal Fair Debt Collection Practices Act (Title 1.6C (commencing with Section 1788) of Part 4 of Division 3 of the Civil Code), and the federal Fair Debt Collection Practices Act (Subchapter V (commencing with Section 1692) of Chapter 41 of Title 15 of the United States Code). The summary shall include a statement that the Federal Trade Commission enforces the federal act. The summary shall be sufficient if it appears in substantially the following form: "State and federal law require debt collectors to treat you fairly and prohibit debt collectors from making false statements or threats of violence, using obscene or profane language, and making improper communications with third parties, including your employer. Except under unusual circumstances, debt collectors may not contact you before 8 a.m. or after 9 p.m. In general, a debt collector may not give information about your debt to another person, other than your attorney or spouse. A debt collector may contact another person to confirm your location or to enforce a judgment. For more information about debt collection activities, you may contact the Federal Trade Commission by telephone at 1-877-FTC-HELP (382-4357) or online at www.ftc.gov." (2) A statement that nonprofit credit counseling services may be available in the area. (b) The notice required by subdivision (a) shall also accompany any document indicating that the commencement of collection activities may occur. (c) The requirements of this section shall apply to the entity engaged in reporting adverse information to a consumer credit reporting agency or commencing a civil action against the patient. If an emergency physician assigns or sells the debt to another entity, the obligations shall apply to the entity, including a collection agency, engaged in the debt collection activity.


127458. The emergency physician shall reimburse the patient or patients any amount actually paid in excess of the amount due under this article, including interest. Interest owed by the emergency physician to the patient shall accrue at the rate set forth in Section 685.010 of the Code of Civil Procedure, beginning on the date payment by the patient is received by the emergency physician. However, an emergency physician is not required to reimburse the patient or pay interest if the amount due is less than five dollars ($5). The emergency physician shall give the patient a credit for the amount due for at least 60 days from the date the amount is due.


127459. The rights, remedies, and penalties established by this article are cumulative, and shall not supersede the rights, remedies, or penalties established under other laws.


127460. Nothing in this article shall be construed to prohibit the emergency physician from uniformly imposing charges from its established charge schedule or published rates, nor shall this article preclude the recognition of an emergency physician's established charge schedule or published rates for purposes of applying any payment limit, interim payment amount, or other payment calculation based upon an emergency physician's rates or charges under the Medi-Cal program, the Medicare Program, workers' compensation, or other federal, state, or local public program of health benefits. No health care service plan, insurer, or any other person shall reduce the amount it would otherwise reimburse a claim for emergency physician services because an emergency physician has waived, or will waive, collection of all or a portion of a patient's bill for emergency physician services in accordance with the emergency physician's discount payment policy, notwithstanding any contractual provision.


127461. Notwithstanding any other provision of law, the amounts paid by parties for services resulting from reduced or waived charges under an emergency physician's discounted payment policy shall not constitute an emergency physician's uniform, published, prevailing, or customary charges, its usual fees to the general public, or its charges to non-Medi-Cal purchasers under comparable circumstances, and shall not be used to calculate an emergency physician's median non-Medicare or non-Medi-Cal charges, for purposes of any payment limit under the federal Medicare Program, the Medi-Cal program, or any other federal or state-financed health care program.


127462. To the extent that any requirement of this article results in a federal determination that an emergency physician's established charge schedule or published rates are not the physician and surgeon' s customary or prevailing charges for services, the requirement in question shall be inoperative for all emergency physicians. The State Department of Public Health shall seek federal guidance regarding modifications to the requirement in question. All other requirements of this article shall remain in effect.


Chapter 3. Uniform Billing Format

Ca Codes (hsc:127575-127600) Health And Safety Code Section 127575-127600



127575. For purposes of this chapter, the following definitions shall apply: (a) "Carrier" means any of the following: (1) Any insurer, including, but not limited to, disability insurers, nonprofit hospital service plans, fraternal benefit societies, and firemen's, policemen's, or peace officers' benefit and relief associations. (2) A health care service plan other than a specialized health care service plan. (3) A self-funded employer sponsored plan, multiple employer trust, or Taft-Hartley Trust as defined by federal law, authorized to pay for health care services in this state. (4) The State Compensation Insurance Fund. (5) The health insurance offered to certain employees of this state by the Public Employees' Retirement System known as "PERS Care." (b) "Department" means the State Department of Health Services. (c) "Office" means the Office of Statewide Health Planning and Development. (d) "Professional health care services" means any diagnostic or treatment services provided in California directly to a patient by a person licensed or practicing pursuant to Division 2 (commencing with Section 500) of the Business and Professions Code who is eligible to directly bill for their services. "Professional health care services" does not include services provided by a person licensed pursuant to a chapter of Division 2 that the director of the office has determined, pursuant to Section 127590, should be exempted. (e) "Institutional provider services" means any services, equipment, and supplies, other than professional health care services that are provided by an institution, site, or facility through which professional health care services are provided. "Institutional provider services" includes any component of an episode of health care for which there will be charges, other than professional health care services. "Institutional provider services" does not include diagnostic or treatment services that would be considered "professional health care services" but for the fact that the provider is licensed under a chapter of Division 2 of the Business and Professions Code that the director of the office has exempted pursuant to Section 127590. (f) "California uniform billing form for professional health care services" and "California uniform billing form for institutional provider services" means billing forms in the formats developed by the office pursuant to Section 127580.


127580. The office, after consultation with the Insurance Commissioner, the Director of the Department of Managed Health Care, the State Director of Health Services, and the Director of Industrial Relations, shall adopt a California uniform billing form format for professional health care services and a California uniform billing form format for institutional provider services. The format for professional health care services shall be the format developed by the National Uniform Claim Form Task Force. The format for institutional provider services shall be the format developed by the National Uniform Billing Committee. The formats shall be acceptable for billing in federal Medicare and medicaid programs. The office shall specify a single uniform system for coding diagnoses, treatments, and procedures to be used as part of the uniform billing form formats. The system shall be acceptable for billing in federal Medicare and medicaid programs.

127585. (a) Carriers shall accept, and providers shall use, a completed California uniform billing form, or the electronic equivalent, for each instance when a carrier provides coverage for professional health care services and for each instance when a carrier provides coverage for institutional provider services. (b) Carriers that are health care service plans licensed under the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code), and providers of professional health care services or institutional provider services covered by those plans shall be exempt from the requirement of subdivision (a) except in instances when the provider of the professional health care services bills the plan for the specific services provided and in instances when the provider of the institutional provider services bills the plan for the specific services provided. (c) Nothing in the forms shall be construed to prohibit a carrier from requiring that its insured or enrollee, or a person acting on behalf of the insured or enrollee, submit other information to the carrier as necessary to determine that the professional health care services or institutional provider services are covered under the terms of the carrier's health benefits plan.


127590. The Director of the Office of Statewide Health Planning and Development may determine that the definition of "professional health care services" in subdivision (d) of Section 127575 does not include services provided by persons licensed under certain chapters of Division 2 of the Business and Professions Code and shall have the authority to determine the chapters that shall be exempt.


127595. The department shall adopt the California uniform billing form formats for use in all health care payment programs it administers, including, but not limited to, Medi-Cal, county health services programs, and other health care payment programs, for each instance when a program provides coverage for professional health care services and for each instance when a program provides coverage for institutional provider services. The department may adapt the billing format for institutional provider services only to the extent necessary for the forms to be optically scanned and automatically microfilmed. The department shall provide exemptions from this requirement as necessary and appropriate to the efficient operation of health care service plans that do not reimburse providers on a fee-for-service basis, except that the plans shall use the formats in instances when the professional or institutional provider bills a plan for the specific services provided. The department shall implement this requirement in any Medi-Cal contract for fiscal intermediary services entered into on or after January 1, 1993.


127600. (a) The department, in consultation with the office and the California Health Policy and Data Advisory Commission, may develop a uniform core dataset for public health programs to do all of the following: (1) Reduce administrative complexity. (2) Eliminate unnecessary duplication in the collection and reporting of data. (3) Facilitate integration, consistency, and transfer of data among public health and health services programs. (4) Promote monitoring of health status, planning, policy development and service coordination, quality assurance, and program evaluation for all public health programs. (b) The department, in consultation with the office and the California Health Policy and Data Advisory Commission, shall develop proposed policies and procedures to ensure privacy and confidentiality of data and appropriate use and access to data. (c) This section shall not be construed to require any physician and surgeon or other health care provider to provide any additional items of information to these public health care programs.


Chapter 4. Rural Health

Article 1. Rural Health Care Transition Oversight

Ca Codes (hsc:127620) Health And Safety Code Section 127620



127620. (a) The Office of Statewide Health Planning and Development, in conjunction with the State Department of Health Services, shall act as the coordinating agency to develop a strategic plan that would assist rural California to prepare for health care reform. The plan shall assist in the coordination and integration of all rural health care services on the birth to death continuum and serve as an infrastructure for rural communities to establish priorities and develop appropriate programs. (b) The office shall designate representatives from provider groups including rural hospitals, clinics, physicians, other rural providers including psychologists, counties, beneficiaries, and other entities directly affected by the plan. The office shall convene meetings with the objectives of doing all of the following: (1) Assessing the current status of health care in rural communities. (2) Assembling and reviewing data related to available programs and resources for rural California. (3) Assembling and reviewing data related to other states' strategic plans for rural communities. (4) Reviewing and integrating the office's rural work plan, as appropriate. (5) Making assumptions about the future of health care and developing a strategic plan based on these assumptions. (c) The rural health care strategic plan shall address all of the following: (1) The special needs of the elderly and of ethnic populations. (2) Elimination of barriers in planning and coordinating health services. (3) The lack of primary and specialty providers. (4) Access to emergency services. (5) The role of new technologies, including, but not limited to, telemedicine.


Chapter 7. University Of California Assessment On Legislation Proposing Mandated Benefits Or

Services Ca Codes (hsc:127660-127665) Health And Safety Code Section 127660-127665



127660. (a) The Legislature hereby requests the University of California to establish the California Health Benefit Review Program to assess legislation proposing to mandate a benefit or service, as defined in subdivision (c), and legislation proposing to repeal a mandated benefit or service, as defined in subdivision (d), and to prepare a written analysis with relevant data on the following: (1) Public health impacts, including, but not limited to, all of the following: (A) The impact on the health of the community, including the reduction of communicable disease and the benefits of prevention such as those provided by childhood immunizations and prenatal care. (B) The impact on the health of the community, including diseases and conditions where gender and racial disparities in outcomes are established in peer-reviewed scientific and medical literature. (C) The extent to which the benefit or service reduces premature death and the economic loss associated with disease. (2) Medical impacts, including, but not limited to, all of the following: (A) The extent to which the benefit or service is generally recognized by the medical community as being effective in the screening, diagnosis, or treatment of a condition or disease, as demonstrated by a review of scientific and peer reviewed medical literature. (B) The extent to which the benefit or service is generally available and utilized by treating physicians. (C) The contribution of the benefit or service to the health status of the population, including the results of any research demonstrating the efficacy of the benefit or service compared to alternatives, including not providing the benefit or service. (D) The extent to which mandating or repealing the benefits or services would not diminish or eliminate access to currently available health care benefits or services. (3) Financial impacts, including, but not limited to, all of the following: (A) The extent to which the coverage or repeal of coverage will increase or decrease the benefit or cost of the benefit or service. (B) The extent to which the coverage or repeal of coverage will increase the utilization of the benefit or service, or will be a substitute for, or affect the cost of, alternative benefits or services. (C) The extent to which the coverage or repeal of coverage will increase or decrease the administrative expenses of health care service plans and health insurers and the premium and expenses of subscribers, enrollees, and policyholders. (D) The impact of this coverage or repeal of coverage on the total cost of health care. (E) The potential cost or savings to the private sector, including the impact on small employers as defined in paragraph (1) of subdivision (l) of Section 1357, the Public Employees' Retirement System, other retirement systems funded by the state or by a local government, individuals purchasing individual health insurance, and publicly funded state health insurance programs, including the Medi-Cal program and the Healthy Families Program. (F) The extent to which costs resulting from lack of coverage or repeal of coverage are or would be shifted to other payers, including both public and private entities. (G) The extent to which mandating or repealing the proposed benefit or service would not diminish or eliminate access to currently available health care benefits or services. (H) The extent to which the benefit or service is generally utilized by a significant portion of the population. (I) The extent to which health care coverage for the benefit or service is already generally available. (J) The level of public demand for health care coverage for the benefit or service, including the level of interest of collective bargaining agents in negotiating privately for inclusion of this coverage in group contracts, and the extent to which the mandated benefit or service is covered by self-funded employer groups. (K) In assessing and preparing a written analysis of the financial impact of legislation proposing to mandate a benefit or service and legislation proposing to repeal a mandated benefit or service pursuant to this paragraph, the Legislature requests the University of California to use a certified actuary or other person with relevant knowledge and expertise to determine the financial impact. (b) The Legislature requests that the University of California provide every analysis to the appropriate policy and fiscal committees of the Legislature not later than 60 days after receiving a request made pursuant to Section 127661. In addition, the Legislature requests that the university post every analysis on the Internet and make every analysis available to the public upon request. (c) As used in this section, "legislation proposing to mandate a benefit or service" means a proposed statute that requires a health care service plan or a health insurer, or both, to do any of the following: (1) Permit a person insured or covered under the policy or contract to obtain health care treatment or services from a particular type of health care provider. (2) Offer or provide coverage for the screening, diagnosis, or treatment of a particular disease or condition. (3) Offer or provide coverage of a particular type of health care treatment or service, or of medical equipment, medical supplies, or drugs used in connection with a health care treatment or service. (d) As used in this section, "legislation proposing to repeal a mandated benefit or service" means a proposed statute that, if enacted, would become operative on or after January 1, 2008, and would repeal an existing requirement that a health care service plan or a health insurer, or both, do any of the following: (1) Permit a person insured or covered under the policy or contract to obtain health care treatment or services from a particular type of health care provider. (2) Offer or provide coverage for the screening, diagnosis, or treatment of a particular disease or condition. (3) Offer or provide coverage of a particular type of health care treatment or service, or of medical equipment, medical supplies, or drugs used in connection with a health care treatment or service.


127661. A request pursuant to this chapter may be made by an appropriate policy or fiscal committee chairperson, the Speaker of the Assembly, or the President pro Tempore of the Senate, who shall forward the introduced bill to the University of California for assessment.


127662. (a) In order to effectively support the University of California and its work in implementing this chapter, there is hereby established in the State Treasury, the Health Care Benefits Fund. The university's work in providing the bill analyses shall be supported from the fund. (b) For fiscal years 2010-11 to 2014-15, inclusive, each health care service plan, except a specialized health care service plan, and each health insurer, as defined in Section 106 of the Insurance Code, shall be assessed an annual fee in an amount determined through regulation. The amount of the fee shall be determined by the Department of Managed Health Care and the Department of Insurance in consultation with the university and shall be limited to the amount necessary to fund the actual and necessary expenses of the university and its work in implementing this chapter. The total annual assessment on health care service plans and health insurers shall not exceed two million dollars ($2,000,000). (c) The Department of Managed Health Care and the Department of Insurance, in coordination with the university, shall assess the health care service plans and health insurers, respectively, for the costs required to fund the university's activities pursuant to subdivision (b). (1) Health care service plans shall be notified of the assessment on or before June 15 of each year with the annual assessment notice issued pursuant to Section 1356. The assessment pursuant to this section is separate and independent of the assessments in Section 1356. (2) Health insurers shall be noticed of the assessment in accordance with the notice for the annual assessment or quarterly premium tax revenues. (3) The assessed fees required pursuant to subdivision (b) shall be paid on an annual basis no later than August 1 of each year. The Department of Managed Health Care and the Department of Insurance shall forward the assessed fees to the Controller for deposit in the Health Care Benefits Fund immediately following their receipt. (4) "Health insurance," as used in this subdivision, does not include Medicare supplement, vision-only, dental-only, or CHAMPUS supplement insurance, or hospital indemnity, accident-only, or specified disease insurance that does not pay benefits on a fixed benefit, cash payment only basis.


127663. In order to avoid conflicts of interest, the Legislature requests the University of California to develop and implement conflict-of-interest provisions to prohibit a person from participating in any analysis in which the person knows or has reason to know he or she has a material financial interest, including, but not limited to, a person who has a consulting or other agreement with a person or organization that would be affected by the legislation.


127664. The Legislature requests the University of California to submit a report to the Governor and the Legislature by January 1, 2014, regarding the implementation of this chapter.


127665. This chapter shall remain in effect until June 30, 2015, and shall be repealed as of that date, unless a later enacted statute that becomes operative on or before June 30, 2015, deletes or extends that date.


Chapter 8. California Health Care Quality Improvement And Cost Containment Commission

Ca Codes (hsc:127670-127671) Health And Safety Code Section 127670-127671



127670. The Legislature finds and declares the following: (a) California's health care system needs to be reformed to provide high quality accessible, affordable, and equitable care and treatment. (b) Too many Californians are unable to obtain affordable, high quality health care. (c) The rising costs associated with health care are driven by numerous factors, including, but not limited to, the following: (1) Prescription drug spending, including costs of research and development and marketing and increased drug utilization. (2) Hospital rates. (3) Health insurance premium rates. (4) Provider rates. (5) Health system inefficiencies. (6) Fraud and abuse in the health care system. (7) Technology development and utilization. (8) Emergency room overutilization. (9) Inequitable allocation of services and treatment to different segments of the population. (10) Cost shifting, which occurs when the costs of providing uncompensated health care to uninsured individuals is shifted to those with health insurance, driving health care prices and insurance premiums higher. (d) Health care cost containment is an important part of enabling the health care coverage system to provide high quality care in a manner that improves patient outcomes. (e) Evidence-based medicine may improve cost-effectiveness and care to patients by using scientific evidence to determine clinical practice, drug therapy, and other measures that improve the quality of care in a cost-effective manner while taking into account the special needs of individual patients. To improve quality as well as cost-effectiveness, evidence-based medicine should take into account the special needs of persons with disabilities as well as the racial, ethnic, and gender disparities in health research and the provision of health care. (f) Chronic diseases, such as heart disease, stroke, asthma, cancer, and diabetes, are among the most prevalent, costly, and preventable of all health problems. Seventy-eight percent of health care costs can be attributed to the treatment of chronic conditions. "Disease management" provides a strategy to improve patient health outcomes and limit health care spending by identifying and monitoring high-risk populations, helping patients and providers better adhere to proven interventions, engaging patients in their own care management, and establishing more coordinated care interventions and followup systems to prevent unnecessary and expensive health complications. These disease management strategies should be tailored to fit the needs of each patient. Disease management is most effective when it takes into account racial, ethnic, and gender disparities in health research and the provision of health care. (g) Without reform, California's health care system may fail to deliver the affordable quality care that all Californians deserve. (h) It is the intent of the Legislature to make available valid performance information to encourage hospitals and physicians to provide care that is safe, medically effective, patient-centered, timely, efficient, and equitable. It is also the intent of the Legislature to strengthen the ability of the Office of Statewide Health Planning and Development to put hospital performance information into the hands of consumers, purchasers, and providers. (i) It is the intent of the Legislature to encourage health care service plans, health insurers, and providers to develop innovative approaches, services, and programs that may have the potential to deliver health care that is both cost-effective and responsive to the needs of enrollees.


127671. (a) The Governor shall convene the California Health Care Quality Improvement and Cost Containment Commission, hereinafter referred to as "the commission," to research and recommend appropriate and timely strategies for promoting high quality care and containing health care costs. (b) The commission shall be composed of 27 members who are knowledgeable about the health care system and health care spending. (c) The Governor shall appoint 17 members of the commission, as follows: (1) Three representatives of California's business community, including at least one representative from a small business. (2) Two representatives from organized labor, one of whom represents health care workers. (3) Two representatives of consumers. (4) Two health care practitioners, including at least one physician. (5) One representative of the disabilities community. (6) One hospital industry representative. (7) One pharmaceutical industry representative. (8) Two representatives of the health insurance industry, one with expertise in managed health care delivery systems and one with expertise in health insurance underwriting and rating. (9) One representative of academic or health care policy research institutions. (10) One health care economist. (11) One expert in disease management techniques and wellness programs. (d) The Senate Committee on Rules shall appoint four members, with two members from the majority party and two from the minority party. (e) The Speaker of the Assembly shall appoint four members, of which two members shall be the Chair and Vice Chair of the Assembly Committee on Health. (f) The Secretary of the Health and Human Services Agency and the Director of the Department of Managed Health Care shall serve as members of the commission. (g) The Governor shall appoint the chairperson of the commission. (h) The commission shall, on or before January 1, 2006, issue a report to the Legislature and the Governor making recommendations for health care quality improvement and cost containment. The commission shall, at a minimum, examine and address the following issues: (1) Assessing California health care needs and available resources. (2) Lowering the cost of health care coverage. (3) Increasing patient choices of health coverage options and providers. (4) Improving the quality of health care. (5) Increasing the transparency of health care costs and the relative efficiency with which care is delivered. (6) Potential for integration with workers' compensation insurance. (7) Use of disease management, wellness, prevention, and other innovative programs to keep people healthy while reducing costs and improving health outcomes. (8) Consolidation of existing state programs to achieve efficiencies where possible. (9) Efficient utilization of prescription drugs and technology. (i) Notwithstanding any other provision of law, the members of the task force shall receive no per diem or travel expense reimbursement, or any other expense reimbursement.


Part 3. Health Professions Development

Chapter 1. Health Professions Planning

Article 1. Health Personnel Planning

Ca Codes (hsc:127750-127800) Health And Safety Code Section 127750-127800



127750. The office shall prepare a Health Manpower Plan for California. The plan shall consist of at least the following elements: (a) The establishment of appropriate standards for determining the adequacy of supply in California of at least each of the following categories of health personnel: physicians, midlevel medical practitioners (physician's assistants and nurse practitioners); nurses; dentists; midlevel dental practitioners (dental nurses and dental hygienists); optometrists; optometry assistants; pharmacists; and pharmacy technicians. (b) A determination of appropriate standards for the adequacy of supply of the categories in subdivision (a) shall be made by taking into account all of the following: current levels of demand for health services in California; the capacity of each category of personnel in subdivision (a) to provide health services; the extent to which midlevel practitioners and assistants can substitute their services for those of other personnel; the likely impact of the implementation of a national health insurance program on the demand for health services in California; professionally developed standards for the adequacy of the supply of health personnel; and assumptions concerning the future organization of health care services in California. (c) A determination of the adequacy of the current and future supply of health personnel by category in subdivision (a) taking into account the sources of supply for such personnel in California, the magnitude of immigration of personnel to California, and the likelihood of the immigration continuing. (d) A determination of the adequacy of the supply of specialties within each category of health personnel in subdivision (a). The determination shall be made, based upon standards of appropriate supply to speciality developed, in accordance with subdivision (b). (e) Recommendations concerning changes in health manpower policies, licensing statutes, and programs needed to meet the state's need for health personnel.


127755. The office shall consult with the California Healthcare Workforce Policy Commission, health systems agencies, and other appropriate organizations in the preparation of this plan.


127760. The Legislature finds and declares that: (a) Planning for appropriate supplies and distribution of health care personnel is essential to assure the continued health and well-being of the people of the state and also to contain excess costs that may result from unnecessary training and underutilization of health care personnel. (b) The information on physicians and surgeons collected by the Medical Board of California, in cooperation with the office, and under the authority of Sections 921 and 923 of the Business and Professions Code, has proven to be valuable for health manpower planning purposes. It is the intent of the Legislature, through this article, to provide for the efficient collection and analysis of similar information on other major categories of healing arts licentiates, in order to facilitate the development of the biennial health manpower plan and other reports and program activities of the office. (c) It is the intent of the Legislature that the data transmitted to the office by the various boards be processed by the boards so that licentiates are not identified by name or license number.


127765. The office is authorized and directed to receive, with the cooperation of the respective healing arts licensing boards and licentiates, basic data on each licentiate in the following categories of health personnel: registered nurses, licensed vocational nurses, pharmacists, dentists, and optometrists. The office shall develop a suggested format for data collection to be utilized by the various boards. However, the methods utilized to collect and tabulate this information, including the format and content of questionnaires and other survey instruments, shall be determined by each respective healing arts licensing board after consultation with the director of the office.


127770. The basic data to be collected on each licentiate in accordance with Section 127765 shall include at least all of the following: principal and other practice locations, practice specialty or specialties for appropriate categories, time spent in direct patient-care/patient-contact and other professional activities, race or ethnicity, age, sex, and educational background.


127775. Notwithstanding Sections 922 and 925 of the Business and Professions Code, the office may receive, and the Medical Board of California may provide, information respecting individual licentiates collected pursuant to Sections 921 and 923 of the Business and Professions Code. Information provided to the office pursuant to this section shall be transmitted in a form so that the name or license number of an individual licensee is not identifiable. However, an encoding procedure shall be used to assign a unique identifying number to the other information provided upon the questionnaire so as to allow the office to track the geographical movements of physicians for planning purposes.

127780. The office shall maintain the confidentiality of the information it receives respecting individual licentiates under this article and shall only release information in a form that cannot be used to identify individuals.

127785. The California Postsecondary Education Commission shall furnish to the office, at least biennially, all information that the commission has compiled pursuant to Section 66903.2 of the Education Code, that constitutes basic data as to enrollees in public and private educational institutions and programs preparing or training health personnel. The office may request additional data from licensing boards and agencies to supplement the data received from the commission, as necessary to carry out the health personnel planning and development activities of the office.


127790. The basic data to be provided to the office pursuant to Section 127785 shall include all of the following, by training year or class: numbers enrolled, numbers in the various discipline or specialty categories, and numbers in age, sex, and race or ethnic categories.


127795. The office shall implement the authority granted to the office by Sections 127765, 127775, and 127785, on a phased basis, consistent with respective relicensure intervals and with the availability of resources for the effective utilization of the data and information obtained under that authority.


127800. The respective licensing boards for registered nurses, licensed vocational nurses, pharmacists, optometrists, and dentists may adopt regulations that require licentiates to provide the information included in Section 127770 as a condition of relicensure. In order to facilitate the collection and analysis of this information, any of these boards may use information from a scientifically selected random sample of the licentiates. These licensing boards may collaborate with the office in the collection or analysis of this information.


Chapter 2. Personnel Recruitment And Education

Article 1. Health Professions Careers Opportunity Program 127875-127885

Ca Codes (hsc:127875-127885) Health And Safety Code Section 127875-127885



127875. The Legislature finds and declares that California has an insufficient number of minority health professionals to meet the health care needs in the state. Greater numbers of minority health professionals are required to meet the special needs of population groups who face cultural and linguistic barriers to adequate health care, and to meet the state's needs for a more equitable geographic distribution of professional health personnel resources.


127880. It is the intent of the Legislature to maintain a Health Professions Career Opportunity Program designed to: (a) Increase the number of ethnic minorities in health professional training. (b) Increase the number of minority health professionals practicing in health manpower shortage areas in this area.


127885. The office shall maintain a Health Professions Career Opportunity Program that shall include, but not be limited to, all of the following: (a) Producing and disseminating a series of publications aimed at informing and motivating minority and disadvantaged students to pursue health professional careers. (b) Conducting a conference series aimed at informing those students of opportunities in health professional training and mechanisms of successfully preparing to enter the training. (c) Providing support and technical assistance to health professional schools and colleges as well as to student and community organizations active in minority health professional development. (d) Conducting relevant manpower information and data analysis in the field of minority and disadvantaged health professional development. (e) Providing necessary consultation, recruitment, and counseling through other means. (f) Supporting and encouraging minority health professionals in training to practice in health professional shortage areas of California. (g) This section shall be implemented only to the extent that funds are appropriated for its purposes in the annual Budget Act or other statute.


Article 2. Health Promotion Education Programs For Allied Health Professionals

Ca Codes (hsc:127900) Health And Safety Code Section 127900



127900. (a) The Legislature finds and declares that evidence exists to support the development of health promotion and health-risk reduction programs as an effective method of constraining the annual inflation rate for expenditures in the health industry. It is, therefore, the intent of the Legislature that a health manpower education program be developed to demonstrate the health promotion and health-risk reduction concept at educational institutions, with special emphasis on health manpower development in urban areas having a disproportionate share of disadvantaged and indigent persons. (b) The office shall establish a contract program for funding allied health manpower training projects related to health promotion and health-risk reduction. The contract program shall provide funds to eligible institutions, as determined by the office, for all of the following purposes: (1) Teaching existing and future primary care providers about health-risk reduction through the institutions' basic curricula. (2) Recruiting, remediating, and retaining minority allied health professionals, including, but not limited to, physician assistants, nurse practitioners, nurse midwives, public health nurses, health educators, dieticians, and nutritionists, especially those who provide in-home patient care. (3) Increasing the supply of medical care in underserved urban areas and demonstrating methods which reduce cost through the use of allied health personnel. (c) These funds shall be available to institutions which currently operate programs for training family practice physicians, other primary care physicians, and those health professionals identified in paragraph (2) of subdivision (b). (d) The recipients of the funds shall provide, but shall not be limited to providing, orientation and training of primary care providers in teaching methods related to patient health education and health promotion, such as educating allied health professionals in the principles of self-care management as it relates to specific health problems in medically underserved communities. (e) The office shall consult with organizations and experts in the field regarding the establishment of this program, and beginning with the 1986-87 fiscal year, this program shall be implemented to the extent funds are provided in the Budget Act. This program shall be designed to accommodate an appropriation request in the range of forty thousand dollars ($40,000) to eighty thousand dollars ($80,000) per year. (f) The director of the office may waive any of the requirements of subdivisions (b) and (c) if a potential contractor demonstrates an ability to meet the goals and objectives of the program.


Article 2.5. California Medical And Dental Student Loan Repayment Program

Ca Codes (hsc:127925-127933) Health And Safety Code Section 127925-127933



127925. This article shall be known and may be cited as the California Medical and Dental Student Loan Repayment Program of 2002.


127926. It is the intent of this article that the Office of Statewide Health Planning and Development, in consultation with the Dental Board of California, the Medical Board of California, the medical and dental community, including ethnic representatives, medical and dental schools, health advocates representing ethnic communities, primary care clinics, public hospitals and health systems, statewide agencies administering state and federally funded programs targeting underserved communities, and members of the public with health care issue area expertise shall develop and implement the California Medical and Dental Student Loan Repayment Program of 2002.


127927. (a) There is hereby established in the Office of Statewide Health Planning and Development the California Medical and Dental Student Loan Repayment Program of 2002. (b) The Office of Statewide Health Planning and Development shall operate the California Medical and Dental Student Loan Repayment Program of 2002 in accordance with, but not limited to, the following: (1) Increased efforts in educating medical and dental students and medical residents of the need for physicians and dentists in underserved communities, and of programs that are available that provide incentives, financial and otherwise, to practice in settings and areas in need. (2) Strategic collaboration with California medical and dental schools and postgraduate programs to better prepare physicians and dentists to meet the distinctive cultural and medical needs of underserved populations. (3) Encourage the University of California and other medical and dental schools to increase the number of medical and dental students and medical residency program positions. (4) Establish, encourage, and expand programs for medical and dental students and medical residents for mentoring at primary and secondary schools, and college levels to increase the number of students entering the medical and dental sciences. (5) Administer financial or other incentives to encourage new or experienced physicians and dentists to practice in underserved areas.


127928. For purposes of this part, the following terms have the following meanings: (a) "Program" means the California Medical and Dental Student Loan Repayment Program of 2002. (b) (1) "Medically underserved area" means an area as defined in Part 5 of Chapter 1 of Title 42 of the Code of Federal Regulations or an area of the state where unmet priority needs for physicians exists as determined by the California Healthcare Workforce Policy Commission pursuant to Section 128225 of the Health and Safety Code. (2) "Dentally underserved area" means a geographic area eligible to be designated as having a shortage of dental professionals pursuant to Part I of Appendix B to Part 5 of Chapter 1 of Title 42 of the Code of Federal Regulations or an area of the state where unmet priority needs for dentists exist as determined by the California Healthcare Workforce Policy Commission pursuant to Section 128224 of the Health and Safety Code. (c) (1) "Medically underserved population" means the Medi-Cal, Healthy Families and uninsured population. (2) "Dentally underserved population" means persons without dental insurance and persons eligible for the Denti-Cal and Healthy Families Programs who are population groups described as having a shortage of dental care professionals in Part I of Appendix B to Part 5 of Chapter 1 of Title 42 of the Code of Federal Regulations. (d) "Medi-Cal threshold languages" means primary languages spoken by limited-English-proficient (LEP) population groups meeting a numeric threshold of 3,000 eligible LEP Medi-Cal beneficiaries residing in a county, 1,000 Medi-Cal eligible LEP beneficiaries residing in a single ZIP Code, or 1,500 LEP Medi-Cal beneficiaries residing in two contiguous ZIP Codes. (e) "Office" means the Office of Statewide Health Planning and Development.

127929. (a) The office shall administer the California Medical and Dental Student Loan Repayment Program of 2002. Any individual enrolled in an institution of postsecondary education participating in the program set forth in this article may be eligible to receive a conditional warrant for loan repayment, to be redeemed upon becoming employed as a physician or dentist in a medically underserved area or a dentally underserved area serving primarily medically or dentally underserved populations. In order to be eligible to receive a conditional loan repayment warrant, an applicant shall satisfy all of the following conditions: (1) The applicant has been judged by his or her postsecondary institution to have outstanding ability on the basis of criteria that may include, but not be limited to, any of the following: (A) Grade point average. (B) Test scores. (C) Faculty evaluations. (D) Interviews. (E) Other recommendations. (2) In order to meet the costs associated with obtaining a medical or dental degree, the applicant has received, or is approved to receive, a loan under one or more of the following designated loan programs: (A) The Federal Family Education Loan Program (10 U.S.C. Sec. 1071 et seq.). (B) Any loan program approved by the Student Aid Commission. (3) The applicant has agreed to provide services as a licensed physician for up to three consecutive years, after obtaining a license from the Medical Board of California in a medically underserved area, or the applicant has agreed to provide services as a licensed dentist for up to three consecutive years, after obtaining a license from the Dental Board of California in a dentally underserved area. (4) The applicant has agreed to work in a setting where the applicant will primarily serve medically or dentally underserved populations. (b) The office shall ensure that priority consideration be given to applicants who are best suited to meet the cultural and linguistic needs and demands of medically and dentally underserved populations and who meet one or more of the following criteria: (1) Speak a Medi-Cal threshold language. (2) Come from an economically disadvantaged background. (3) Have received significant training in cultural and linguistically appropriate service delivery. (4) Have done a medical rotation serving medically underserved populations or provided dental services to members of a dentally underserved population. (c) A person participating in the program pursuant to this section shall not receive more than one warrant. (d) The office shall adopt rules and regulations regarding the reallocation of warrants if a participating institution is unable to utilize its allocated warrants or is unable to distribute them within a reasonable time period.


127930. The office, in accordance with Section 127926, shall develop the process to redeem an applicant's warrant and commence loan repayment.

127931. (a) The office shall distribute student applications to participate in the program to postsecondary institutions eligible to participate in the state and federal financial aid programs and that have a program of professional preparation that has been approved by the Medical Board of California or the Dental Board of California. Each eligible institution shall receive at least one application. (b) Each participating institution shall sign an institutional agreement with the office, certifying its intent to administer the program according to all applicable published rules, regulations, and guidelines, and shall make special efforts to notify students regarding the availability of the program, particularly to economically disadvantaged students. (c) To the extent feasible, the office and each participating institution shall coordinate this program with other existing programs designed to recruit or encourage students to enter the medical and dental professions. These programs shall include, but not be limited to, the following: (1) The Song-Brown Health Care Workforce Training Act. (2) The Health Education and Academic Loan Act. (3) The National Health Service Corp.


127932. (a) The office, in accordance with Section 127926, shall administer this program, and shall adopt rules and regulations for that purpose. The rules and regulations shall include, but not be limited to, provisions regarding the period of time for which a warrant shall remain valid, the reallocation of warrants that are not utilized, and the development of projections for funding purposes. (b) The office shall work in conjunction with lenders participating in federal or similar loan programs to develop a streamlined application process for participation in the program set forth in this article.


127933. (a) The office shall establish a fund to utilize for the purposes of this article. (b) The office may seek matching funds from foundations and private sources. The office may also contract with an exempt foundation for the receipt of matching funds to be transferred to the fund for use by this program. (c) The provisions of this article shall not become operative unless appropriate funding, as determined by the office, is made available.


Article 2.75. National Health Service Corps State Loan Repayment Program

Ca Codes (hsc:127940) Health And Safety Code Section 127940



127940. In administering the National Health Service Corps State Loan Repayment Program in accordance with Section 254q-1 of Title 42 of the United States Code and related federal regulations, the office shall strive, whenever feasible, to equitably distribute loan repayment awards between eligible urban and rural program sites, after taking into account the availability of health care services in the communities to be served and the number of individuals to be served in each program site. The office shall set a reasonable deadline for when all applications are required to be received. All eligible applications shall be given consideration before any award is granted.


Article 3. Nursing Education Scholarships

Ca Codes (hsc:127975-128020) Health And Safety Code Section 127975-128020



127975. Recognizing that there is a shortage in supply of registered nurses, and that if the number of nursing students is to be materially increased to meet the demand there must first be an increase in the number of persons qualified for teaching or supervising in clinical areas, and further recognizing that the cost of education deters nurses from obtaining the education necessary to qualify them for teaching or supervision in clinical areas, there are hereby created state scholarships that shall be maintained by the state and awarded and administered pursuant to this article.


127980. There shall be available at least 10 scholarships per year. The scholarships shall be available to any registered nurse who is enrolled in one of the following accredited nursing programs in a college or university in California that is accredited by the Western Association of Schools and Colleges: (a) The junior or senior year in a bachelor's degree program in nursing. (b) A program supplementary to a bachelor's degree program in nursing required for admission to master's level studies, in nursing. (c) A master's degree or a post-master's program in teaching or supervision in a clinical nursing area.


127985. No person shall be awarded a scholarship under subdivision (a) or (b) of Section 127980 unless: (a) He or she is a resident of California. (b) He or she is licensed as a registered nurse by this state. (c) He or she has complied with all the regulations adopted pursuant to this article. (d) He or she has agreed that he or she will continue his or her education to completion of the bachelor's degree or a program supplemental to a bachelor's degree required for admission to master level studies in nursing, and that after completion of the requirements of subdivision (a) or (b) of Section 127980 and within a period of time to be determined by the office, will enroll in an accredited master's degree program in teaching or supervision in a clinical nursing area. (e) He or she agrees that immediately upon completion of his or her graduate study, either master's degree or post-master's program, he or she will assume an employment obligation in California in teaching or supervision in a clinical nursing area, for not less than one year.


127990. No person shall be awarded a scholarship under subdivision (c) of Section 127980 unless he or she satisfies the requirements prescribed by subdivisions (a), (b), (c), and (e) of Section 127985.


127995. The office shall administer the program of nursing education scholarships and shall for this purpose, adopt regulations as it determines are necessary to carry out this article.


128000. Applications for scholarships shall be made to the office, upon forms provided by it, at the times and in the manner prescribed by the regulations adopted by the office.


128005. The office shall award the scholarships to the applicants that it determines are best fitted to undertake the educational program for which the scholarships are awarded and will be the best qualified to teach or supervise. In awarding the scholarships the office may give a preference to applicants who are willing to be available, upon the completion of their educational program, for a position in any part of the state. The office shall not, however, award any scholarship to an applicant if it determines that the applicant has adequate financial resources to pay the cost of the education necessary to qualify him or her for teaching or supervision in a clinical area.


128010. Scholarships shall be awarded without regard to race, religion, creed, or sex.


128015. Each scholarship under this article is for the period of no more than one academic year, and the award shall be: (a) For a person qualifying under subdivision (a) or (b) of Section 127980, the sum of two hundred dollars ($200) per month for 12 months, plus school fees. (b) For a person qualifying under subdivision (c) of Section 127980, the sum of two hundred fifty dollars ($250) per month for 12 months, plus school fees.


128020. A scholarship shall remain in effect only during the period, as determined by the office, that the person receiving the award achieves satisfactory progress and is regularly enrolled, within the terms of this article, as a full-time student.


Article 4. Health Professions Planning Grants

Ca Codes (hsc:128025-128040) Health And Safety Code Section 128025-128040



128025. For the purpose of this article, "innovative programs of education in the health professions" means programs for the development of physicians and surgeons, podiatrists, dentists, pharmacists, nurses, optometrists, and occupations in the allied health professions, that emphasize all of the following: (a) The practice in the community on the part of graduates of the program. (b) The utilization of existing teaching resources and clinical care facilities within the community where the program is located. (c) The development of curricular mechanisms that allow for movement from one occupational category to the next, up to and including the doctor of medicine level. (d) The training of persons possessing previously acquired health care skills, for positions of greater responsibility, with an emphasis upon corpsmen honorably discharged from the military. (e) The training of persons with little or no formal education but with a willingness and aptitude to acquire health care skills. (f) The development of coordination with community health care facilities to insure quality education and satisfactory employment opportunities for graduates of the program.


128030. The office, in cooperation with the California Postsecondary Education Commission, shall administer the program established pursuant to this article and shall for this purpose, adopt regulations as it determines are reasonably necessary to carry out this article.


128035. The office is authorized to make grants, from funds appropriated by the Legislature for this purpose, to assist organizations in meeting the cost of special projects to plan, develop, or establish innovative programs of education in the health professions, or for research in the various fields related to education in the health professions, or to develop training for new types of health professions personnel, or to meet the costs of planning experimental teaching facilities. In determining priority of project applications, the office shall give the highest priority to: (1) Applicants able to obtain commitments for matching planning funds from other governmental and private sources. (2) Applicants who develop a preliminary plan that conforms to the criteria stated hereinabove for innovative programs of education in the health sciences. (3) Applicants that in its judgment are most able to translate a plan into a feasible program.


128040. (a) The Office of Statewide Health Planning and Development shall report to the Legislature on or before June 30, 2002, on the feasibility of establishing a California dental loan forgiveness program utilizing the same general guidelines applicable to the federal National Health Service Corps State Loan Repayment Program (42 U.S.C.A. Sec. 254q-1; 42 C.F.R., Part 62, Subpart C (commencing with Section 62.51)), except as follows: (1) A dentist shall be eligible to participate in the loan forgiveness program if he or she provides full-time or half-time dental services in either of the following: (A) A dental health professional shortage area (DHPSA), established pursuant to Section 254e(a) of Title 42 of the United States Code. (B) An area of the state where unmet priority needs for dentists exist as determined by the California Healthcare Workforce Policy Commission pursuant to Section 128225. (2) Matching funds to repay a portion of the dentist's outstanding loan amount shall be required from the practice site areas or from other private nonprofit sources. (3) A qualifying practice site shall include a private dental practice. (b) (1) The report required under subdivision (a) shall include all of the following: (A) A projection of the dentist-to-population ratio for California in the next decade. (B) A determination of the future need for dentists and dental care in underserved communities. The office shall work collaboratively with organizations that represent providers of dental services to underserved communities in making this determination. (C) A report on the utilization by dentists of tuition loan repayment programs at the federal and state level and identify the barriers to full utilization of these loan repayment programs. (D) A report on the projected cost increase of dental school education at public and private postsecondary educational institutions. (E) A report on the implications of administering an additional program, including a cost analysis. (2) The report also shall include recommendations on whether a program described in subdivision (a) should be established and, if so, suggested funding sources. In making its recommendations, the office shall consider the impact of the program on access to dental services in areas of the state that currently have a shortage of dentists.


Article 5. Health Care Workforce Clearinghouse

Ca Codes (hsc:128050-128052) Health And Safety Code Section 128050-128052



128050. The Office of Statewide Health Planning and Development shall establish a health care workforce clearinghouse to serve as the central source of health care workforce and educational data in the state. The clearinghouse shall be responsible for the collection, analysis, and distribution of information on the educational and employment trends for health care occupations in the state. The activities of the clearinghouse shall be funded by appropriations made from the California Health Data and Planning Fund in accordance with subdivision (h) of Section 127280.


128051. The Office of Statewide Health Planning and Development shall work with the Employment Development Department's Labor Market Information Division, state licensing boards, and state higher education entities to collect, to the extent available, all of the following data: (a) The current supply of health care workers, by specialty. (b) The geographical distribution of health care workers, by specialty. (c) The diversity of the health care workforce, by specialty, including, but not necessarily limited to, data on race, ethnicity, and languages spoken. (d) The current and forecasted demand for health care workers, by specialty. (e) The educational capacity to produce trained, certified, and licensed health care workers, by specialty and by geographical distribution, including, but not necessarily limited to, the number of educational slots, the number of enrollments, the attrition rate, and wait time to enter the program of study.


128052. The Office of Statewide Health Planning and Development shall prepare an annual report to the Legislature that does all of the following: (a) Identifies education and employment trends in the health care profession. (b) Reports on the current supply and demand for health care workers in California and gaps in the educational pipeline producing workers in specific occupations and geographic areas. (c) Recommends state policy needed to address issues of workforce shortage and distribution.


Chapter 3. Professional Practice Development

Article 1. Health Manpower Pilot Projects

Ca Codes (hsc:128125-128195) Health And Safety Code Section 128125-128195



128125. The Legislature finds that there is a need to improve the effectiveness of health care delivery systems. One way of accomplishing that objective is to utilize health care personnel in new roles and to reallocate health tasks to better meet the health needs of the citizenry. The Legislature finds that experimentation with new kinds and combinations of health care delivery systems is desirable, and that, for purposes of this experimentation, a select number of publicly evaluated health workforce pilot projects should be exempt from the healing arts practices acts. The Legislature also finds that large sums of public and private funds are being spent to finance health workforce innovation projects, and that the activities of some of these projects exceed the limitations of state law. These projects may jeopardize the public safety and the careers of persons who are trained in them. It is the intent of the Legislature to establish the accountability of health workforce innovation projects to the requirements of the public health, safety, and welfare, and the career viability of persons trained in these programs. Further, it is the intent of this legislation that existing healing arts licensure laws incorporate innovations developed in approved projects that are likely to improve the effectiveness of health care delivery systems.


128130. For the purposes of this article: (a) "Office" means the Office of Statewide Health Planning and Development. (b) "Approved project" means an educational or training program approved by the office that does any of the following on a pilot program basis: (1) Teaches new skills to existing categories of health care personnel. (2) Develops new categories of health care personnel. (3) Accelerates the training of existing categories of health care personnel. (4) Teaches new health care roles to previously untrained persons, and that has been so designated by the office. (c) "Trainee" means a person to be taught health care skills. (d) "Supervisor" means a person designated by the project sponsor who already possesses the skills to be taught the trainees and is certified or licensed in California to perform the health care tasks involving the skills. (e) "Health care services" means the practice of medicine, dentistry, nursing, including, but not limited to, specialty areas of nursing such as midwifery, pharmacy, optometry, podiatry, and psychology.

128135. The office may designate experimental health workforce projects as approved projects where the projects are sponsored by community hospitals or clinics, nonprofit educational institutions, or government agencies engaged in health or education activities. Nothing in this section shall preclude approved projects from utilizing the offices of physicians, dentists, pharmacists, and other clinical settings as training sites.


128140. Notwithstanding any other provision of law, a trainee in an approved project may perform health care services under the supervision of a supervisor where the general scope of the services has been approved by the office.

128145. A trainee and his or her supervisor shall be held to the standard of care of, and shall be afforded the same immunities as, an individual otherwise legally qualified to perform the health care service or services performed by the trainee or supervisor.


128150. Any patient being seen or treated by a trainee shall be apprised of that fact and shall be given the opportunity to refuse treatment. Consent to the treatment shall not constitute assumption of the risk.

128155. The office, after one or more public hearings thereon, shall establish minimum standards, guidelines, and instructions for pilot projects. Advance notice of the hearing shall be sent to all interested parties and shall include a copy of the proposed minimum standards, guidelines, and instructions. Organizations requesting designation as approved projects shall complete and submit to the office an application, that shall include a description of the project indicating the category of person to be trained, the tasks to be taught, the numbers of trainees and supervisors, a description of the health care agency to be used for training students, and a description of the types of patients likely to be seen or treated. Additionally, the application shall contain a description of all of the following: (a) The evaluation process to be used. (b) The baseline data and information to be collected. (c) The nature of program data that will be collected and the methods for collecting and analyzing the data. (d) Provision for protecting the safety of patients seen or treated in the project. (e) A statement of previous experience in providing related health care services.


128160. (a) Pilot projects may be approved in the following fields: (1) Expanded role medical auxiliaries. (2) Expanded role nursing. (3) Expanded role dental assistants, dental hygienists, dental hygienists in alternative practice, or dental hygienists in extended functions. (4) Maternal child care personnel. (5) Pharmacy personnel. (6) Mental health personnel. (7) Other health care personnel including, but not limited to, veterinary personnel, chiropractic personnel, podiatric personnel, geriatric care personnel, therapy personnel, and health care technicians. (b) Projects that operate in rural and central city areas shall be given priority.


128165. The office shall carry out periodic onsite visitations of each approved project and shall evaluate each project to determine the following: (a) The new health skills taught or extent that existing skills have been reallocated. (b) Implication of the project for existing licensure laws with suggestions for changes in the law where appropriate. (c) Implications of the project for health services curricula and for the health care delivery systems. (d) Teaching methods used in the project. (e) The quality of care and patient acceptance in the project. (f) The extent that persons with the new skills could find employment in the health care system, assuming laws were changed to incorporate their skill. (g) The cost of care provided in the project, the likely cost of this care if performed by the trainees subsequent to the project, and the cost for provision of this care by current providers thereof. All data collected by the office and by projects approved pursuant to this article shall become public information, with due regard for the confidentiality of individual patient information. The raw data on which projects' reports are based and the data on which the office' s evaluation is based shall be available on request for review by interested parties. The office shall provide a reasonable opportunity for interested parties to submit dissenting views or challenges to reports to the Legislature and professional licensing boards required by this section. The office shall publish those comments, subject only to nonsubstantive editing, as part of its annual, or any special, reports.


128170. The office shall approve a sufficient number of projects to provide a basis for testing the validity of the experiment.


128175. The office shall seek the advice of appropriate professional societies and appropriate healing arts licensing boards prior to designating approved projects. In the case of projects sponsored by a state agency, the following additional procedures shall apply: (a) A hearing shall be conducted by a disinterested state government official selected by the director of the office from a state agency other than the office or the proponent of the project. The cost of the services of the disinterested state governmental official shall be paid by the office pursuant to an interagency agreement with the state agency represented by the state governmental official. (b) A notice of hearing shall be sent by the office to interested parties, as designated by the director of the office, by registered mail no less than 30 days preceding the date of the hearing. The notice shall include, but not be limited to, the date, time, location, and subject matter of the hearing, and shall include a copy of the application for a pilot project that is the subject of the hearing. (c) A verbatim transcript of the hearing shall be prepared and distributed to interested parties upon request. (d) Within 60 days of the release of the transcript, the office shall submit a recommendation on the proposal to the director of the office and shall send copies to the interested parties. (e) The director of the office shall accept comments on the recommendations, and, on or after 30 days after transmittal of the recommendations, the director of the office shall approve or disapprove the proposed project.


128180. The office shall not approve a project for a period lasting more than two training cycles plus a preceptorship of more than 24 months, unless the office determines that the project is likely to contribute substantially to the availability of high-quality health services in the state or a region thereof.

128185. The Legislature finds and declares all of the following: (a) The Health Manpower Pilot Project No. 152 was approved in 1988 to respond to a shortage of adequately trained personnel to meet the needs of residents in long-term health care facilities. (b) Long-term health care facilities continue to report difficulties recruiting and retaining adequate nursing staff to meet current needs. (c) The population most in need of long-term care is growing rapidly. It is estimated by the year 2000, one-third of the entire population in the United States will be composed of persons over 65 years of age. Three-fourths of all residents of long-term health care facilities will be generated by this age group. (d) A 30-percent decrease in the labor pool of health workers has been projected for the same time period. This decline in resources will exacerbate the problem of acquiring adequate nursing resources. (e) The establishment of the geriatric technician as a new category of health worker may have the potential to increase the retention of experienced workers in long-term health care by creating health career opportunities and upward mobility for certified nurse assistants. (f) The use of geriatric technicians is not intended to displace licensed nurses, but rather to augment the level of available trained staff to optimize the quality of long-term health care.


128190. The office may extend the geriatric technician pilot project, known as the Health Manpower Pilot Project No. 152, for a minimum of four additional years, pursuant to reapplication by the sponsoring agency. The project shall continue to meet the applicable requirements established by the office. The number of sponsors authorized to participate in the pilot project may be expanded to a maximum of five.


128195. (a) The office shall issue followup reports on geriatric technician pilot projects approved by the office following 24 months of implementation of the employment utilization phase of each project. The reports shall contain all of the following information: (1) A description of the persons trained, including, but not limited to, the following: (A) The total number of persons who entered training. (B) The total number of persons who completed training. (C) The selection method, including descriptions of any nonquantitative criteria used by employers to refer persons to training. (D) The education and experience of the trainees prior to training. (E) Demographic characteristics of the trainees, as available. (2) An analysis of the training completed, including, but not limited to, the following: (A) Curriculum and core competencies. (B) Qualifications of the instructor. (C) Changes in the curriculum during the pilot project or recommended for the future. (D) The nature of clinical and didactic training, including the ratio of students to instructors. (3) A summary of the specific services provided by geriatric technicians. (4) The new health skills taught or the extent to which existing skills have been reallocated. (5) Implications of the project for existing licensure laws with suggestions for changes in the law where appropriate. (6) Implications of the project for health services curricula and for health care delivery systems. (7) Teaching methods used in the project. (8) The quality of care, including pertinent medication errors, incident reports, and patient acceptance in the project. (9) The extent to which persons with new skills could find employment in the health care system, assuming laws were changed to incorporate their skills. (10) The cost of care provided in the project, the likely cost of this care if performed by the trainees subsequent to the project, and the cost for provision of this care by current providers thereof. (b) Notwithstanding any other provision of law, issuance of the reports described in subdivision (a) shall not require that the office terminate the geriatric technician pilot projects authorized by the office.


Article 2. California Pharmacist Scholarship And Loan Repayment Program

Ca Codes (hsc:128198-128198.5) Health And Safety Code Section 128198-128198.5



128198. (a) (1) There is hereby established in the Office of Statewide Health Planning and Development the California Pharmacist Scholarship and Loan Repayment Program. (2) The program shall provide scholarships to pay for the educational expenses of pharmacy school students and repay qualifying educational loans of pharmacists who agree to participate in designated medically underserved areas as provided in this section. (b) The Office of Statewide Health Planning and Development shall administer the California Pharmacist Scholarship and Loan Repayment Program utilizing the same general guidelines applicable to the federal National Health Service Corps Scholarship Program established pursuant to Section 254 l of Title 42 of the United States Code and the National Health Service Corps Loan Repayment Program established pursuant to Section 254 l-1 of Title 42 of the United States Code, except as follows: (1) A pharmacist or pharmacy school student shall be eligible to participate in the program if he or she agrees to provide pharmacy services in a practice site located in areas of the state where unmet priority needs for primary care family physicians exist as determined by the Health Workforce Policy Commission. (2) No matching funds shall be required from any entity in the practice site area. (c) This section shall be implemented only to the extent that sufficient moneys are available in the California Pharmacist Scholarship and Loan Repayment Program Fund to administer the program.


128198.5. The California Pharmacist Scholarship and Loan Repayment Program Fund is hereby established in the State Treasury. Revenues from the contributions made pursuant to Section 4409 of the Business and Professions Code, as well as any other private or public funds made available for purposes of the California Pharmacist Scholarship and Loan Repayment Program, shall be deposited into the fund. Upon appropriation by the Legislature, moneys in the fund shall be available for expenditure by the Office of Statewide Health Planning and Development for purposes of implementing the California Pharmacist Scholarship and Loan Repayment Program pursuant to this article. The Office of Statewide Health Planning and Development shall be under no obligation to administer a program under this article until sufficient moneys have been accumulated in the fund and appropriated to the office by the Legislature.


Chapter 4. Family Practice Physician Programs (reserved)

Article 1. Family Physician Training Program (reserved)

Chapter 4. Health Care Workforce Training Programs

Article 1. Song-brown Health Care Workforce Training Act 128200-128241

Ca Codes (hsc:128200-128241) Health And Safety Code Section 128200-128241



128200. (a) This article shall be known and may be cited as the Song-Brown Health Care Workforce Training Act. (b) The Legislature hereby finds and declares that physicians engaged in family practice are in very short supply in California. The current emphasis placed on specialization in medical education has resulted in a shortage of physicians trained to provide comprehensive primary health care to families. The Legislature hereby declares that it regards the furtherance of a greater supply of competent family physicians to be a public purpose of great importance and further declares the establishment of the program pursuant to this article to be a desirable, necessary and economical method of increasing the number of family physicians to provide needed medical services to the people of California. The Legislature further declares that it is to the benefit of the state to assist in increasing the number of competent family physicians graduated by colleges and universities of this state to provide primary health care services to families within the state. The Legislature finds that the shortage of family physicians can be improved by the placing of a higher priority by public and private medical schools, hospitals, and other health care delivery systems in this state, on the recruitment and improved training of medical students and residents to meet the need for family physicians. To help accomplish this goal, each medical school in California is encouraged to organize a strong family practice program or department. It is the intent of the Legislature that the programs or departments be headed by a physician who possesses specialty certification in the field of family practice, and has broad clinical experience in the field of family practice. The Legislature further finds that encouraging the training of primary care physician's assistants and primary care nurse practitioners will assist in making primary health care services more accessible to the citizenry, and will, in conjunction with the training of family physicians, lead to an improved health care delivery system in California. Community hospitals in general and rural community hospitals in particular, as well as other health care delivery systems, are encouraged to develop family practice residencies in affiliation or association with accredited medical schools, to help meet the need for family physicians in geographical areas of the state with recognized family primary health care needs. Utilization of expanded resources beyond university-based teaching hospitals should be emphasized, including facilities in rural areas wherever possible. The Legislature also finds and declares that nurses are in very short supply in California. The Legislature hereby declares that it regards the furtherance of a greater supply of nurses to be a public purpose of great importance and further declares the expansion of the program pursuant to this article to include nurses to be a desirable, necessary, and economical method of increasing the number of nurses to provide needed nursing services to the people of California. It is the intent of the Legislature to provide for a program designed primarily to increase the number of students and residents receiving quality education and training in the specialty of family practice and as primary care physician's assistants, primary care nurse practitioners, and registered nurses and to maximize the delivery of primary care family physician services to specific areas of California where there is a recognized unmet priority need. This program is intended to be implemented through contracts with accredited medical schools, programs that train primary care physician's assistants, programs that train primary care nurse practitioners, programs that train registered nurses, hospitals, and other health care delivery systems based on per-student or per-resident capitation formulas. It is further intended by the Legislature that the programs will be professionally and administratively accountable so that the maximum cost-effectiveness will be achieved in meeting the professional training standards and criteria set forth in this article and Article 2 (commencing with Section 128250).


128205. As used in this article, and Article 2 (commencing with Section 128250), the following terms mean: (a) "Family physician" means a primary care physician who is prepared to and renders continued comprehensive and preventative health care services to families and who has received specialized training in an approved family practice residency for three years after graduation from an accredited medical school. (b) "Associated" and "affiliated" mean that relationship that exists by virtue of a formal written agreement between a hospital or other health care delivery system and an approved medical school which pertains to the family practice training program for which state contract funds are sought. This definition shall include agreements that may be entered into subsequent to October 2, 1973, as well as those relevant agreements that are in existence prior to October 2, 1973. (c) "Commission" means the California Healthcare Workforce Policy Commission. (d) "Programs that train primary care physician's assistants" means a program that has been approved for the training of primary care physician assistants pursuant to Section 3513 of the Business and Professions Code. (e) "Programs that train primary care nurse practitioners" means a program that is operated by a California school of medicine or nursing, or that is authorized by the Regents of the University of California or by the Trustees of the California State University, or that is approved by the Board of Registered Nursing. (f) "Programs that train registered nurses" means a program that is operated by a California school of nursing and approved by the Board of Registered Nursing, or that is authorized by the Regents of the University of California, the Trustees of the California State University, or the Board of Governors of the California Community Colleges, and that is approved by the Board of Registered Nursing.


128207. Any reference in any code to the Health Manpower Policy Commission is deemed a reference to the California Healthcare Workforce Policy Commission.

128210. There is hereby created a state medical contract program with accredited medical schools, programs that train primary care physician's assistants, programs that train primary care nurse practitioners, programs that train registered nurses, hospitals, and other health care delivery systems to increase the number of students and residents receiving quality education and training in the specialty of family practice or in nursing and to maximize the delivery of primary care family physician services to specific areas of California where there is a recognized unmet priority need for those services.

128215. There is hereby created a California Healthcare Workforce Policy Commission. The commission shall be composed of 15 members who shall serve at the pleasure of their appointing authorities: (a) Nine members appointed by the Governor, as follows: (1) One representative of the University of California medical schools, from a nominee or nominees submitted by the University of California. (2) One representative of the private medical or osteopathic schools accredited in California from individuals nominated by each of these schools. (3) One representative of practicing family physicians. (4) One representative who is a practicing osteopathic physician or surgeon and who is board certified in either general or family practice. (5) One representative of undergraduate medical students in a family practice program or residence in family practice training. (6) One representative of trainees in a primary care physician's assistant program or a practicing physician's assistant. (7) One representative of trainees in a primary care nurse practitioners program or a practicing nurse practitioner. (8) One representative of the Office of Statewide Health Planning and Development, from nominees submitted by the office director. (9) One representative of practicing registered nurses. (b) Two consumer representatives of the public who are not elected or appointed public officials, one appointed by the Speaker of the Assembly and one appointed by the Chairperson of the Senate Committee on Rules. (c) Two representatives of practicing registered nurses, one appointed by the Speaker of the Assembly and one appointed by the Chairperson of the Senate Committee on Rules. (d) Two representatives of students in a registered nurse training program, one appointed by the Speaker of the Assembly and one appointed by the Chairperson of the Senate Committee on Rules. (e) The Chief of the Health Professions Development Program in the Office of Statewide Health Planning and Development, or the chief's designee, shall serve as executive secretary for the commission.


128220. The members of the commission, other than state employees, shall receive compensation of twenty-five dollars ($25) for each day' s attendance at a commission meeting, in addition to actual and necessary travel expenses incurred in the course of attendance at a commission meeting.


128224. The commission shall identify specific areas of the state where unmet priority needs for dentists, physicians, and registered nurses exist.

128225. The commission shall do all of the following: (a) Identify specific areas of the state where unmet priority needs for primary care family physicians and registered nurses exist. (b) Establish standards for family practice training programs and family practice residency programs, postgraduate osteopathic medical programs in family practice, and primary care physician assistants programs and programs that train primary care nurse practitioners, including appropriate provisions to encourage family physicians, osteopathic family physicians, primary care physician's assistants, and primary care nurse practitioners who receive training in accordance with this article and Article 2 (commencing with Section 128250) to provide needed services in areas of unmet need within the state. Standards for family practice residency programs shall provide that all the residency programs contracted for pursuant to this article and Article 2 (commencing with Section 128250) shall both meet the Residency Review Committee on Family Practice's "Essentials" for Residency Training in Family Practice and be approved by the Residency Review Committee on Family Practice. Standards for postgraduate osteopathic medical programs in family practice, as approved by the American Osteopathic Association Committee on Postdoctoral Training for interns and residents, shall be established to meet the requirements of this subdivision in order to ensure that those programs are comparable to the other programs specified in this subdivision. Every program shall include a component of training designed for medically underserved multicultural communities, lower socioeconomic neighborhoods, or rural communities, and shall be organized to prepare program graduates for service in those neighborhoods and communities. Medical schools receiving funds under this article and Article 2 (commencing with Section 128250) shall have programs or departments that recognize family practice as a major independent specialty. Existence of a written agreement of affiliation or association between a hospital and an accredited medical school shall be regarded by the commission as a favorable factor in considering recommendations to the director for allocation of funds appropriated to the state medical contract program established under this article and Article 2 (commencing with Section 128250). For purposes of this subdivision, "family practice" includes the general practice of medicine by osteopathic physicians. (c) Establish standards for registered nurse training programs. The commission may accept those standards established by the Board of Registered Nursing. (d) Review and make recommendations to the Director of the Office of Statewide Health Planning and Development concerning the funding of family practice programs or departments and family practice residencies and programs for the training of primary care physician assistants and primary care nurse practitioners that are submitted to the Health Professions Development Program for participation in the contract program established by this article and Article 2 (commencing with Section 128250). If the commission determines that a program proposal that has been approved for funding or that is the recipient of funds under this article and Article 2 (commencing with Section 128250) does not meet the standards established by the commission, it shall submit to the Director of the Office of Statewide Health Planning and Development and the Legislature a report detailing its objections. The commission may request the Office of Statewide Health Planning and Development to make advance allocations for program development costs from amounts appropriated for the purposes of this article and Article 2 (commencing with Section 128250). (e) Review and make recommendations to the Director of the Office of Statewide Health Planning and Development concerning the funding of registered nurse training programs that are submitted to the Health Professions Development Program for participation in the contract program established by this article. If the commission determines that a program proposal that has been approved for funding or that is the recipient of funds under this article does not meet the standards established by the commission, it shall submit to the Director of the Office of Statewide Health Planning and Development and the Legislature a report detailing its objections. The commission may request the Office of Statewide Health Planning and Development to make advance allocations for program development costs from amounts appropriated for the purposes of this article. (f) Establish contract criteria and single per-student and per-resident capitation formulas that shall determine the amounts to be transferred to institutions receiving contracts for the training of family practice students and residents and primary care physician' s assistants and primary care nurse practitioners and registered nurses pursuant to this article and Article 2 (commencing with Section 128250), except as otherwise provided in subdivision (d). Institutions applying for or in receipt of contracts pursuant to this article and Article 2 (commencing with Section 128250) may appeal to the director for waiver of these single capitation formulas. The director may grant the waiver in exceptional cases upon a clear showing by the institution that a waiver is essential to the institution's ability to provide a program of a quality comparable to those provided by institutions that have not received waivers, taking into account the public interest in program cost-effectiveness. Recipients of funds appropriated by this article and Article 2 (commencing with Section 128250) shall, as a minimum, maintain the level of expenditure for family practice or primary care physician's assistant or family care nurse practitioner training that was provided by the recipients during the 1973-74 fiscal year. Recipients of funds appropriated for registered nurse training pursuant to this article shall, as a minimum, maintain the level of expenditure for registered nurse training that was provided by recipients during the 2004-05 fiscal year. Funds appropriated under this article and Article 2 (commencing with Section 128250) shall be used to develop new programs or to expand existing programs, and shall not replace funds supporting current family practice or registered nurse training programs. Institutions applying for or in receipt of contracts pursuant to this article and Article 2 (commencing with Section 128250) may appeal to the director for waiver of this maintenance of effort provision. The director may grant the waiver if he or she determines that there is reasonable and proper cause to grant the waiver. (g) Review and make recommendations to the Director of the Office of Statewide Health Planning and Development concerning the funding of special programs that may be funded on other than a capitation rate basis. These special programs may include the development and funding of the training of primary health care teams of family practice residents or family physicians and primary care physician assistants or primary care nurse practitioners or registered nurses, undergraduate medical education programs in family practice, and programs that link training programs and medically underserved communities in California that appear likely to result in the location and retention of training program graduates in those communities. These special programs also may include the development phase of new family practice residency, primary care physician assistant programs, primary care nurse practitioner programs, or registered nurse programs. The commission shall establish standards and contract criteria for special programs recommended under this subdivision. (h) Review and evaluate these programs regarding compliance with this article and Article 2 (commencing with Section 128250). One standard for evaluation shall be the number of recipients who, after completing the program, actually go on to serve in areas of unmet priority for primary care family physicians in California or registered nurses who go on to serve in areas of unmet priority for registered nurses. (i) Review and make recommendations to the Director of the Office of Statewide Health Planning and Development on the awarding of funds for the purpose of making loan assumption payments for medical students who contractually agree to enter a primary care specialty and practice primary care medicine for a minimum of three consecutive years following completion of a primary care residency training program pursuant to Article 2 (commencing with Section 128250).


128230. When making recommendations to the Director of the Office of Statewide Health Planning and Development concerning the funding of family practice programs or departments, family practice residencies, and programs for the training of primary care physician assistants, primary care nurse practitioners, or registered nurses, the commission shall give priority to programs that have demonstrated success in the following areas: (a) Actual placement of individuals in medically underserved areas. (b) Success in attracting and admitting members of minority groups to the program. (c) Success in attracting and admitting individuals who were former residents of medically underserved areas. (d) Location of the program in a medically underserved area. (e) The degree to which the program has agreed to accept individuals with an obligation to repay loans awarded pursuant to the Health Professions Education Fund.


128235. Pursuant to this article and Article 2 (commencing with Section 128250), the Director of the Office of Statewide Health Planning and Development shall do all of the following: (a) Determine whether family practice, primary care physician assistant training program proposals, primary care nurse practitioner training program proposals, and registered nurse training program proposals submitted to the California Healthcare Workforce Policy Commission for participation in the state medical contract program established by this article and Article 2 (commencing with Section 128250) meet the standards established by the commission. (b) Select and contract on behalf of the state with accredited medical schools, programs that train primary care physician assistants, programs that train primary care nurse practitioners, hospitals, and other health care delivery systems for the purpose of training undergraduate medical students and residents in the specialty of family practice. Contracts shall be awarded to those institutions that best demonstrate the ability to provide quality education and training and to retain students and residents in specific areas of California where there is a recognized unmet priority need for primary care family physicians. Contracts shall be based upon the recommendations of the commission and in conformity with the contract criteria and program standards established by the commission. (c) Select and contract on behalf of the state with programs that train registered nurses. Contracts shall be awarded to those institutions that best demonstrate the ability to provide quality education and training and to retain students and residents in specific areas of California where there is a recognized unmet priority need for registered nurses. Contracts shall be based upon the recommendations of the commission and in conformity with the contract criteria and program standards established by the commission. (d) Terminate, upon 30 days' written notice, the contract of any institution whose program does not meet the standards established by the commission or that otherwise does not maintain proper compliance with this part, except as otherwise provided in contracts entered into by the director pursuant to this article and Article 2 (commencing with Section 128250).


128240. The Director of the Office of Statewide Health Planning and Development shall adopt, amend, or repeal regulations as necessary to enforce this article and Article 2 (commencing with Section 128250), which shall include criteria that training programs must meet in order to qualify for waivers of single capitation formulas or maintenance of effort requirements authorized by Section 128250. Regulations for the administration of this chapter shall be adopted, amended, or repealed as provided in Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.

128240.1. The department shall adopt emergency regulations, as necessary to implement the changes made to this article by the act that added this section during the first year of the 2005-06 Regular Session, no later than September 30, 2005, unless notification of a delay is made to the Chair of the Joint Legislative Budget Committee prior to that date. The adoption of regulations implementing the applicable provisions of this act shall be deemed to be an emergency and necessary for the immediate preservation of the public peace, health, safety, or general welfare. The emergency regulations authorized by this section shall be submitted to the Office of Administrative Law for filing with the Secretary of State and shall remain in effect for no more than 180 days, by which time the final regulations shall be developed.


128241. The Office of Statewide Health Planning and Development shall develop alternative strategies to provide long-term stability and non-General Fund support for programs established pursuant to this article. The office shall report on these strategies to the legislative budget committees by February 1, 2005.


Article 2. Health Education And Academic Loan Act

Ca Codes (hsc:128250-128290) Health And Safety Code Section 128250-128290



128250. This article shall be known and may be cited as the Health Education and Academic Loan Act.


128255. The Legislature finds and declares all of the following: (a) Lower levels of reimbursement in rural and inner-city areas for certain critical primary care practices combined with increasing student costs deter medical students from entering the primary care specialties. (b) Physicians typically begin their practices heavily in debt from student loans acquired to finance their education. (c) Because of the lower levels of reimbursement and the burden of educational debts, the number of primary care physicians who choose to practice in California is insufficient to adequately meet the health needs of the state's population. (d) Repayment of student loans for medical students as a means to encourage increased provision of primary care medical services will benefit all citizens of California.


128260. As used in this article, unless the context otherwise requires, the following definitions shall apply: (a) "Commission" means the California Healthcare Workforce Policy Commission. (b) "Director" means the Director of Statewide Health Planning and Development. (c) "Medically underserved designated shortage area" means any of the following: (1) An area designated by the commission as a critical health workforce shortage area. (2) A medically underserved area, as designated by the United States Department of Health and Human Services. (3) A critical workforce shortage area, as defined by the United States Department of Health and Human Services. (d) "Primary care physician" means a physician who has the responsibility for providing initial and primary care to patients, for maintaining the continuity of patient care, and for initiating referral for care by other specialists. A primary care physician shall be a board-certified or board-eligible general internist, general pediatrician, general obstetrician-gynecologist, or family physician.

128265. (a) The commission may provide assistance for the repayment of any student loan for medical education received by a medical student in an institution of higher education in California. The director, with the advice and upon the recommendation of the commission, shall make loan assumption payments using the criteria developed pursuant to this section and Sections 128270 and 128275 any other criteria developed by the commission that are consistent with this section and Sections 128270 and 128275. The commission may not provide loan assumption assistance for a loan that is in default at the time of the application. (b) The Office of Statewide Health Planning and Development, in consultation with the commission, may adopt, by regulation, rules and procedures necessary to administer the loan assumption program established pursuant to this section and Sections 128270 and 128275.


128270. To be eligible for loan assumption assistance, an applicant shall meet both of the following requirements: (a) Be enrolled as a full-time student in an accredited California medical school and be a resident of California at the time of the application. (b) Enter a primary care residency training program in California and provide primary care medical services for a minimum of three years after completion of residency.


128275. (a) Each recipient of loan assumption assistance shall enter into a written contract with the commission, which shall be considered a contract with the State of California. In executing contracts, the commission shall give priority to those applicants who agree to provide primary care services for a minimum of three years in a medically underserved designated shortage area. (b) The contract shall include all of the following terms and conditions: (1) An unlicensed applicant shall apply for a license to practice medicine in California at the earliest practicable opportunity. (2) Within six months after licensure and the completion of all requirements for the primary care specialty, the applicant shall engage in the practice of primary care medicine. (3) The recipient shall agree to provide three consecutive years of service as a primary care physician in a medically underserved designated shortage area, or five consecutive years of service in an area not designated by the commission or the United States Department of Health and Human Services as a medically underserved area in order to receive loan assumption assistance made on his or her behalf directly to the lending institution. Loan assumption assistance shall be provided only for the principal amount of the recipient's loan. If any recipient takes pregnancy or paternity leave or suffers temporary disability, the recipient shall perform an amount of service equal to the amount of service lost because of the pregnancy or paternity leave or temporary disability. Performance of that service by the recipient shall commence immediately upon his or her return to work following the leave or disability. Under a three-year term of service, 20 percent of the total grant shall be provided on behalf of the recipient upon completion of the first year of service; 30 percent shall be provided on behalf of the recipient upon completion of the second year of service; and 50 percent shall be provided to the recipient or to the lending institution on behalf of the recipient upon completion of three years of service as a primary care physician if the recipient received medical student loan deferment. If a recipient agrees to provide five years of service pursuant to this paragraph, 20 percent of the total grant shall be provided on behalf of the recipient upon completion of the first year of service; 10 percent shall be provided upon completion of the second year of service; 10 percent shall be provided upon completion of the third year of service; 10 percent shall be provided upon completion of the fourth year of service; and 50 percent shall be provided to the recipient or to the lending institution on behalf of the recipient upon completion of five years of service as a primary care physician if the recipient received medical student loan deferment. (4) The physician shall treat patients in the area who are eligible for medicaid, Medicare, Medi-Cal, and county reimbursement for low-income and medically indigent adults in addition to fee-for-service patients and shall develop a sliding fee scale for low-income patients. (5) Those applicants who agree to practice in underserved areas shall practice full time in the medically underserved designated shortage area. (6) The physician shall permit the commission to monitor his or her practice to determine compliance with the terms of the contract. (7) The commission shall certify compliance with the terms of the contract for purposes of receipt by the physician of the loan assumption assistance for years subsequent to the initial year of loan assumption assistance. (8) If the recipient dies or becomes totally or permanently disabled, the commission shall nullify the service obligation of the recipient and the commission shall repay the student loan in full. (9) If the recipient is convicted of a felony or misdemeanor involving moral turpitude, commits an act of gross negligence in the performance of service obligations, or his or her license to practice is revoked or suspended by the appropriate licensing board, the commission may demand repayment of any funds expended as loan assumption assistance on behalf of the physician. (10) Any recipient of loan assumption assistance who fails to fulfill the obligations for which he or she contracted shall pay to the commission the full amount received plus interest from the date of the original contract at the rate of 2 percent above the prime rate at the time of the breach. The director may recover all costs and attorney fees incurred as a result of collecting payments resulting from the breach. (11) The loan assumption program provided by this section shall apply only to government loans, or those loans insured or made available by federal or state government. (12) Not more than 10 percent of the funds obtained from alternative sources, as specified in Section 128290, may be used to cover the administrative costs incurred by the Office of Statewide Health Planning and Development to implement the loan assumption program.

128280. Each publicly funded medical school in California shall inform incoming medical students of all student loan, loan repayment, and medical student scholarship programs available to them. This information shall include, but need not be limited to, information concerning the National Health Service Corps program, the Health Professions Education Foundation Program, and the Loan Assumption Program created pursuant to this article.


128285. No requirement contained in this article shall apply to the University of California unless the Regents of the University of California, by resolution, make that requirement applicable.


128290. (a) This article shall only be implemented if private funds are made available from private sources for all program and administrative costs related to the implementation of this article. (b) No state funds shall be used to implement this article. (c) This article shall become operative only upon certification by the Director of the Office of Statewide Health Planning and Development that sufficient private funds have been made available from private sources to implement this article.


Article 3. Additional Duties Of The Health Manpower Policy Commission (hmpc) (reserved)

Chapter 5. Health Professions Education Foundation Programs

Article 1. Health Professions Education Foundation

Ca Codes (hsc:128330-128370) Health And Safety Code Section 128330-128370



128330. As used in this article: (a) "Board" means the Board of Trustees of the Health Professions Education Foundation. (b) "Commission" means the California Healthcare Workforce Policy Commission. (c) "Director" means the Director of the Office of Statewide Health Planning and Development. (d) "Foundation" means the Health Professions Education Foundation. (e) "Health professions" or "health professionals" means physicians and surgeons licensed pursuant to Chapter 5 (commencing with Section 2000) of Division 2 of the Business and Professions Code or pursuant to the Osteopathic Act, dentists, registered nurses, and other health professionals determined by the office to be needed in medically underserved areas. (f) "Office" means the Office of Statewide Health Planning and Development. (g) "Underrepresented groups" means African-Americans, Native Americans, Hispanic-Americans, or other persons underrepresented in medicine, dentistry, nursing, or other health professions as determined by the board. After January 1, 1990, the board, upon a finding that the action is necessary to meet the health care needs of medically underserved areas, may add a group comprising the economically disadvantaged to those groups authorized to receive assistance under this article.


128335. (a) The office shall establish a nonprofit public benefit corporation, to be known as the Health Professions Education Foundation, that shall be governed by a board consisting of a total of 13 members, nine members appointed by the Governor, one member appointed by the Speaker of the Assembly, one member appointed by the Senate Committee on Rules, and two members of the Medical Board of California appointed by the Medical Board of California. The members of the foundation board appointed by the Governor, Speaker of the Assembly, and Senate Committee on Rules may include representatives of minority groups that are underrepresented in the health professions, persons employed as health professionals, and other appropriate members of health or related professions. All persons considered for appointment shall have an interest in health programs, an interest in health educational opportunities for underrepresented groups, and the ability and desire to solicit funds for the purposes of this article as determined by the appointing power. The chairperson of the commission shall also be a nonvoting, ex officio member of the board. (b) The Governor shall appoint the president of the board of trustees from among those members appointed by the Governor, the Speaker of the Assembly, the Senate Committee on Rules, and the Medical Board of California. (c) The director, after consultation with the president of the board, may appoint a council of advisers comprised of up to nine members. The council shall advise the director and the board on technical matters and programmatic issues related to the Health Professions Education Foundation Program. (d) Members of the board and members of the council shall serve without compensation but shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of the board or the council. Members appointed by the Medical Board of California shall serve without compensation, but shall be reimbursed by the Medical Board of California for any actual and necessary expenses incurred in connection with their duties as members of the foundation board. (e) Notwithstanding any provision of law relating to incompatible activities, no member of the foundation board shall be considered to be engaged in activities inconsistent and incompatible with his or her duties solely as a result of membership on the Medical Board of California. (f) The foundation shall be subject to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 2 of the Corporations Code), except that if there is a conflict with this article and the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 2 of the Corporations Code), this article shall prevail. (g) This section shall remain in effect only until January 1, 2016, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2016, deletes or extends that date.


128335. (a) The office shall establish a nonprofit public benefit corporation, to be known as the Health Professions Education Foundation, that shall be governed by a board consisting of nine members appointed by the Governor, one member appointed by the Speaker of the Assembly, and one member appointed by the Senate Committee on Rules. The members of the foundation board appointed by the Governor, Speaker of the Assembly, and Senate Committee on Rules may include representatives of minority groups which are underrepresented in the health professions, persons employed as health professionals, and other appropriate members of health or related professions. All persons considered for appointment shall have an interest in health programs, an interest in health educational opportunities for underrepresented groups, and the ability and desire to solicit funds for the purposes of this article as determined by the appointing power. The chairperson of the commission shall also be a nonvoting, ex officio member of the board. (b) The Governor shall appoint the president of the board of trustees from among those members appointed by the Governor, the Speaker of the Assembly, and the Senate Committee on Rules. (c) The director, after consultation with the president of the board, may appoint a council of advisers comprised of up to nine members. The council shall advise the director and the board on technical matters and programmatic issues related to the Health Professions Education Foundation Program. (d) Members of the board and members of the council shall serve without compensation but shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of the board or the council. (e) The foundation shall be subject to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 2 of the Corporations Code), except that if there is a conflict with this article and the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 2 of the Corporations Code), this article shall prevail. (f) This section shall become operative January 1, 2016.


128340. (a) Of the members of the board first appointed by the Governor pursuant to Section 128335, three members shall be appointed to serve a two-year term, three members shall be appointed to serve a three-year term, and three members shall be appointed to serve a four-year term. (b) Of the members of the board first appointed by the Speaker of the Assembly and the Senate Committee on Rules pursuant to Section 128335, each member shall be appointed to serve a four-year term. (c) Upon the expiration of the initial appointments for the board, each member shall be appointed to serve a four-year term.


128345. The Health Professions Education Foundation may do any of the following: (a) Solicit and receive funds from business, industry, foundations, and other private or public sources for the purpose of providing financial assistance in the form of scholarships or loans to African-American students, Native American students, Hispanic-American students, and other students from underrepresented groups. These funds shall be expended by the office after transfer to the Health Professions Education Fund, created pursuant to Section 128355. (b) Recommend to the director the disbursement of private sector moneys deposited in the Health Professions Education Fund to students from underrepresented groups accepted to or enrolled in schools of medicine, dentistry, nursing, or other health professions in the form of loans or scholarships. (c) Recommend to the director a standard contractual agreement to be signed by the director and any participating student, that would require a period of obligated professional service in the areas in California designated by the commission as deficient in primary care services. The agreement shall include a clause entitling the state to recover the funds awarded plus the maximum allowable interest for failure to begin or complete the service obligation. (d) Develop criteria for evaluating the likelihood that applicants for scholarships or loans would remain to practice their profession in designated areas deficient in primary care services. (e) Develop application forms, which shall be disseminated to students from underrepresented groups interested in applying for scholarships or loans. (f) Encourage private sector institutions, including hospitals, community clinics, and other health agencies to identify and provide educational experiences to students from underrepresented groups who are potential applicants to schools of medicine, dentistry, nursing, or other health professions. (g) Prepare and submit an annual report to the office documenting the amount of money solicited from the private sector, the number of scholarships and loans awarded, the enrollment levels of students from underrepresented groups in schools of medicine, dentistry, nursing, and other health professions, and the projected need for scholarships and loans in the future. (h) Recommend to the director that a portion of the funds solicited from the private sector be used for the administrative requirements of the foundation. (i) Implement the Steven M. Thompson Physician Corps Loan Repayment Program and the Volunteer Physician Program, as provided under Article 5 (commencing with Section 128550).


128350. The office shall do all of the following: (a) Provide technical and staff support to the foundation in meeting all of its responsibilities. (b) Provide financial management for the Health Professions Education Fund. (c) Enter into contractual agreements with students from underrepresented groups for the disbursement of scholarships or loans in return for the commitment of these students to practice their profession in an area in California designated as deficient in primary care services. (d) Disseminate information regarding the areas in the state that are deficient in primary care services to potential applicants for the scholarships or loans. (e) Monitor the practice locations of the recipients of the scholarships or loans. (f) Recover funds, in accordance with the terms of the contractual agreements, from recipients of scholarships or loans who fail to begin or complete their obligated service. Funds so recovered shall be redeposited in the Health Professions Education Fund. (g) Contract with the institutions that train family practice residents, in order to increase the participation of students from underrepresented groups in entering the specialty of family practice. The director may seek the recommendations of the commission or foundation as to what programs best demonstrate the ability to meet this objective. (h) Contract with training institutions that are involved in osteopathic postgraduate training in general or family practice medicine, in order to increase the participation of students from underrepresented groups participating in the practice of osteopathic medicine. The director may seek the recommendations of the commission or foundation as to what programs have demonstrated the ability to meet this objective. (i) Enter into contractual agreements with graduated health professionals to repay some or all of the debts they incurred in health professional schools in return for practicing their professions in an area in California designated as deficient in primary care services. (j) Contract with institutions that award baccalaureate of science degrees in nursing in order to increase the participation of students from underrepresented groups in the nursing profession. The director may seek the recommendations of the commission as to what programs have demonstrated the ability to meet this objective.


128355. There is hereby created within the office a Health Professions Education Fund. The primary purpose of this fund is to provide scholarships and loans to students from underrepresented groups who are accepted to or enrolled in schools of medicine, dentistry, nursing, or other health professions, and to fund the Geriatric Nurse Practitioner and Clinical Nurse Specialist Scholarship Program pursuant to Article 3 (commencing with Section 128425). The fund shall also be used to pay for the cost of administering the program and for any other purpose authorized by this article. The level of expenditure by the office for the administrative support of the program created pursuant to this article shall be subject to review and approval annually through the State Budget process. The office may receive private donations to be deposited into this fund. All money in the fund is continuously appropriated to the office for the purposes of this article and Article 3 (commencing with Section 128425). The office shall manage this fund prudently in accordance with other provisions of law.


128360. Any regulations the office adopts to implement this article shall be adopted as emergency regulations in accordance with Section 11346.1 of the Government Code, except that the regulations shall be exempt from the requirements of subdivisions (e), (f), and (g) of that section. The regulations shall be deemed to be emergency regulations for the purposes of Section 11346.1 of the Government Code.


128365. Notwithstanding any other provision, meetings of the board need not be open to the public when the board discusses applications for financial assistance under this article, or other matters that the board and the office reasonably determine should not be discussed in public due to privacy considerations.

128370. Notwithstanding any other law, the office may exempt from public disclosure any document in the possession of the office that pertains to a donation made pursuant to this article if the donor has requested anonymity.


Article 2. California Registered Nurse Education Program 128375-128401

Ca Codes (hsc:128375-128401) Health And Safety Code Section 128375-128401



128375. (a) The Legislature hereby finds and declares that an adequate supply of professional nurses is critical to assuring the health and well-being of the citizens of California, particularly those who live in medically underserved areas. (b) The Legislature further finds that changes in the health care system of this state have increased the need for more highly skilled nurses. These changes include advances in medical technology and pharmacology, that necessitate the use of more highly skilled nurses in acute care facilities. Further, the containment of health care costs has led to increased reliance on home health care and outpatient services and to a higher proportion of more acutely ill patients in acute care facilities. Long-term care facilities also need more highly educated nursing personnel. Both shifts require a larger number of skilled nursing personnel. (c) The Legislature further finds and declares that in nursing, as in other professions, certain populations are underrepresented. The Legislature also finds and declares that it is especially important that nursing care be provided in a way that is sensitive to the sociocultural variables that affect a person's health. The Legislature recognizes that the financial burden of obtaining a baccalaureate degree is considerable and that persons from families lacking adequate financial resources may need financial assistance to complete a baccalaureate degree. (d) The Legislature further finds and declares that approximately 54.1 percent of all Californians live in rural and urban areas that have been designated underserved. The shortage of professional nurses in these areas makes it more difficult for those citizens to obtain health care and more difficult to attract and retain other health care professionals to those areas. (e) The Legislature further finds and declares that since July 1, 1989, the Registered Nurse Education Fund has collected five million two hundred eight thousand five hundred seventy-four dollars ($5,208,574) to support the education of professional nurses and nursing students in California. (f) The Legislature further finds and declares that since 1990, the Health Professions Education Foundation has awarded over four million dollars ($4,000,000) in scholarship and loan repayment to 754 nursing students and nurses in California. (g) The Legislature further finds and declares that 107 award recipients are baccalaureate of science degree prepared nurses who have made a commitment to practice in medically underserved areas of California for a period of two years in exchange for loan repayment. (h) The Legislature further finds that 485 of the award recipients are baccalaureate of science degree nursing students. Since 1990, 199 nurses have completed their contractual obligation with the Office of Statewide Health Planning and Development. (i) The Legislature further finds and declares that, since 1994, 112 associate degree nursing scholarship awards have been made to students who have signed a contract with the office to complete a baccalaureate of science degree within five years of completing their associate degree. Six students have completed the articulations pilot program. (j) The Legislature further finds that recipients of the foundation's financial assistance program have come from very diverse backgrounds. Scholarships have been awarded to African-Americans, American Indians, Asian-Pacific Islanders, Caucasians, Hispanic-Americans, and other individuals.


128380. It is the intent of the Legislature to accomplish the following: (a) Assure an adequate supply of appropriately trained professional nurses. (b) Encourage persons from populations that are currently underrepresented in the nursing profession to enter that profession. (c) Encourage professional nurses to work in medically underserved areas.

128385. (a) There is hereby created the Registered Nurse Education Program within the Health Professions Education Foundation. Persons participating in this program shall be persons who agree in writing prior to graduation to serve in an eligible county health facility, an eligible state-operated health facility, a health workforce shortage area, or a California nursing school, as designated by the director of the office. Persons agreeing to serve in eligible county health facilities, eligible state-operated health facilities, or health workforce shortage areas, and master's or doctoral students agreeing to serve in a California nursing school may apply for scholarship or loan repayment. The Registered Nurse Education Program shall be administered in accordance with Article 1 (commencing with Section 128330), except that all funds in the Registered Nurse Education Fund shall be used only for the purpose of promoting the education of registered nurses and related administrative costs. The Health Professions Education Foundation shall make recommendations to the director of the office concerning both of the following: (1) A standard contractual agreement to be signed by the director and any student who has received an award to work in an eligible county health facility, an eligible state-operated health facility, or in a health workforce shortage area that would require a period of obligated professional service in the areas of California designated by the California Healthcare Workforce Policy Commission as deficient in primary care services. The obligated professional service shall be in direct patient care. The agreement shall include a clause entitling the state to recover the funds awarded plus the maximum allowable interest for failure to begin or complete the service obligation. (2) Maximum allowable amounts for scholarships, educational loans, and loan repayment programs in order to assure the most effective use of these funds. (b) Applicants may be persons licensed as registered nurses, graduates of associate degree nursing programs prior to entering a program granting a baccalaureate of science degree in nursing, or students entering an entry-level master's degree program in registered nursing or other registered nurse master's or doctoral degree program approved by the Board of Registered Nursing. Priority shall be given to applicants who hold associate degrees in nursing. (c) Registered nurses and students shall commit to teaching nursing in a California nursing school for five years in order to receive a scholarship or loan repayment for a master's or doctoral degree program. (d) Not more than 5 percent of the funds available under the Registered Nurse Education Program shall be available for a pilot project designed to test whether it is possible to encourage articulation from associate degree nursing programs to baccalaureate of science degree nursing programs. Persons who otherwise meet the standards of subdivision (a) shall be eligible for educational loans when they are enrolled in associate degree nursing programs. If these persons complete a baccalaureate of science degree nursing program in California within five years of obtaining an associate degree in nursing and meet the standards of this article, these loans shall be completely forgiven. (e) As used in this section, "eligible county health facility" means a county health facility that has been determined by the office to have a nursing vacancy rate greater than noncounty health facilities located in the same health facility planning area. (f) As used in this section, "eligible state-operated health facility" means a state-operated health facility that has been determined by the office to have a nursing vacancy rate greater than noncounty health facilities located in the same health facility planning area.


128390. The funds made available pursuant to this article shall be used as specified in Article 14 (commencing with Section 69795) of Chapter 2 of Part 42 of the Education Code, except that the funds shall be used only for the purpose of assisting students in completing nursing programs meeting the standards specified in subdivision (j) of Section 69799 of the Education Code.


128395. In developing this program, the Health Professions Education Foundation shall solicit the advice of representatives of the Board of Registered Nurses, the California Nurses Association and other professional nurse organizations, the Chancellor of the California Community Colleges, the Chancellor of the California State University, and the California Association of Hospitals and Health Systems. The foundation shall solicit the advice of representatives who reflect the demographic diversity of California.


128400. There is hereby established in the State Treasury the Registered Nurse Education Fund. All money in the fund shall be used for the purposes specified in the California Registered Nurse Education Program established pursuant to this article. This fund shall receive money collected pursuant to subdivision (c) of Section 2815 of the Business and Professions Code.


128401. (a) The Office of Statewide Health Planning and Development shall adopt regulations establishing the statewide Associate Degree Nursing (A.D.N.) Scholarship Pilot Program. (b) Scholarships under the pilot program shall be available only to students in counties determined to have the most need. Need in a county shall be established based on consideration of all the following factors: (1) Counties with a registered nurse-to-population ratio equal or less than 500 registered nurses per 100,000 individuals. (2) County unemployment rate. (3) County level of poverty. (c) A scholarship recipient shall be required to complete, at a minimum, an associate degree in nursing and work in a medically underserved area in California upon obtaining his or her license from the Board of Registered Nursing. (d) The Health Professions Education Foundation shall consider the following factors when selecting recipients for the A.D.N. Scholarship Pilot Program: (1) An applicant's economic need, as established by the federal poverty index. (2) Applicants who demonstrate cultural and linguistic skills and abilities. (e) The pilot program shall be funded from the Registered Nurse Education Fund established pursuant to Section 128400 and administered by the Health Professions Education Foundation within the office. The Health Professions Education Foundation shall allocate a portion of the moneys in the fund for the pilot program established pursuant to this section, in addition to moneys otherwise allocated pursuant to this article for scholarships and loans for associate degree nursing students. (f) No additional staff or General Fund operating costs shall be expended for the pilot program. (g) The Health Professions Education Foundation may accept private or federal funds for purposes of the A.D.N. Scholarship Pilot Program. (h) This section shall remain in effect only until January 1, 2014, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2014, deletes or extends that date.


Article 3. Geriatric Nurse Practitioner And Clinical Nurse Specialist Scholarship Program

Ca Codes (hsc:128425-128450) Health And Safety Code Section 128425-128450



128425. The Legislature hereby finds and declares that more and better qualified medical care is needed for residents of health care facilities. The Legislature further finds that the shortage of physicians available to work in skilled nursing facilities and other facilities providing care primarily to geriatric patients is expected to continue. Therefore, it is the intent of the Legislature to promote more and better-qualified medical care for geriatric patients by increasing training opportunities for geriatric nurse practitioners and geriatric clinical nurse specialists and by providing an incentive for nurse practitioners and clinical nurse specialists to practice in skilled nursing facilities or other facilities providing care primarily to geriatric patients. It is not the intent of the Legislature in enacting this article to change the existing scope of practice of nurse practitioners or clinical nurse specialists.


128430. For purposes of this article: (a) A "geriatric clinical nurse specialist" is a registered nurse, licensed by the Board of Registered Nursing, who has completed a master's program in nursing with an emphasis on care of elders. (b) A "geriatric nurse practitioner" is a registered nurse, licensed by the Board of Registered Nursing as a nurse practitioner, who has completed an educational program in gerontological nursing, or family or adult nursing with an emphasis on care of elders.


128435. (a) There is hereby created the Geriatric Nurse Practitioner and Clinical Nurse Specialist Scholarship Program within the Health Professions Education Foundation. Persons participating in this program shall be persons enrolled in nurse practitioner or clinical nurse specialist programs in this state who agree in writing prior to graduation to practice for a period of time, to be determined in accordance with paragraph (1) of subdivision (b), as geriatric nurse practitioners or geriatric clinical nurse specialists either in skilled nursing facilities licensed pursuant to Section 1250 or in other settings where care is provided primarily to geriatric patients. This program shall be administered in accordance with Article 1 (commencing with Section 128330), and Article 2 (commencing with Section 128375), except that all funds shall be used only for geriatric nurse practitioners and geriatric clinical nurse specialists and except that the programs shall be available only to those geriatric nurse practitioners and geriatric clinical nurse specialists who agree to practice in skilled nursing facilities or other settings caring for geriatric patients. (b) The Health Professions Education Foundation shall make recommendations to the director of the office concerning both of the following: (1) A standard contractual agreement to be signed by the director and any student who has received an award to practice in a skilled nursing facility or other setting caring for geriatric patients that would require a period of obligated professional service. The obligated professional service shall be in direct patient care. The obligated professional service may be performed by a geriatric nurse practitioner or geriatric clinical nurse specialist either as an employee or independent contractor of a skilled nursing facility or other setting caring for geriatric patients, or as an employee or independent contractor of a physician providing care for geriatric patients in a skilled nursing facility or other setting. The agreement shall include a clause entitling the state to recover the funds awarded plus the maximum allowable interest for failure to begin or complete the service obligation. (2) Maximum allowable amounts for scholarships and other financial assistance in order to assure the most effective use of these funds. (c) To the extent feasible and appropriate, the Health Professions Education Foundation shall assure that the standard contractual agreement and other aspects of the Geriatric Nurse Practitioner and Clinical Nurse Specialist Scholarship Program are substantially similar to those developed for the Registered Nurse Education Program.

128440. Awards shall be coordinated with other financial assistance. An effort shall be made to reach all nurse practitioner and clinical nurse specialist education programs in California.


128445. In developing this program, the Health Professions Education Foundation shall solicit the advice of the representatives of the Board of Registered Nursing, the Student Aid Commission, the California Nurses Association, the California Association of Health Facilities, the California Association of Homes for the Aging, the Chancellor of the California State University, the President of the University of California, and other entities as may be appropriate.


128450. This program shall be funded through the Health Professions Education Fund pursuant to Section 128355.


Article 4. Licensed Mental Health Service Provider Education Program

Ca Codes (hsc:128454-128458) Health And Safety Code Section 128454-128458



128454. (a) There is hereby created the Licensed Mental Health Service Provider Education Program within the Health Professions Education Foundation. (b) For purposes of this article, the following definitions shall apply: (1) "Licensed mental health service provider" means a psychologist licensed by the Board of Psychology, registered psychologist, postdoctoral psychological assistant, postdoctoral psychology trainee employed in an exempt setting pursuant to Section 2910 of the Business and Professions Code, or employed pursuant to a State Department of Mental Health waiver pursuant to Section 5751.2 of the Welfare and Institutions Code, marriage and family therapist, marriage and family therapist intern, licensed clinical social worker, and associate clinical social worker. (2) "Mental health professional shortage area" means an area designated as such by the Health Resources and Services Administration (HRSA) of the United States Department of Health and Human Services. (c) Commencing January 1, 2005, any licensed mental health service provider, including a mental health service provider who is employed at a publicly funded mental health facility or a public or nonprofit private mental health facility that contracts with a county mental health entity or facility to provide mental health services, who provides direct patient care in a publicly funded facility or a mental health professional shortage area may apply for grants under the program to reimburse his or her educational loans related to a career as a licensed mental health service provider. (d) The Health Professions Education Foundation shall make recommendations to the director of the office concerning all of the following: (1) A standard contractual agreement to be signed by the director and any licensed mental health service provider who is serving in a publicly funded facility or a mental health professional shortage area that would require the licensed mental health service provider who receives a grant under the program to work in the publicly funded facility or a mental health professional shortage area for at least one year. (2) The maximum allowable total grant amount per individual licensed mental health service provider. (3) The maximum allowable annual grant amount per individual licensed mental health service provider. (e) The Health Professions Education Foundation shall develop the program, which shall comply with all of the following requirements: (1) The total amount of grants under the program per individual licensed mental health service provider shall not exceed the amount of educational loans related to a career as a licensed mental health service provider incurred by that provider. (2) The program shall keep the fees from the different licensed providers separate to ensure that all grants are funded by those fees collected from the corresponding licensed provider groups. (3) A loan forgiveness grant may be provided in installments proportionate to the amount of the service obligation that has been completed. (4) The number of persons who may be considered for the program shall be limited by the funds made available pursuant to Section 128458.


128456. In developing the program established pursuant to this article, the Health Professions Education Foundation shall solicit the advice of representatives of the Board of Behavioral Sciences, the Board of Psychology, the State Department of Mental Health, the California Mental Health Directors Association, the California Mental Health Planning Council, professional mental health care organizations, the California Healthcare Association, the Chancellor of the California Community Colleges, and the Chancellor of the California State University. The foundation shall solicit the advice of representatives who reflect the demographic, cultural, and linguistic diversity of the state.


128458. There is hereby established in the State Treasury the Mental Health Practitioner Education Fund. The moneys in the fund, upon appropriation by the Legislature, shall be available for expenditure by the Office of Statewide Health Planning and Development for purposes of this article.


Article 4. Vocational Nurse Education Program

Ca Codes (hsc:128475-128501) Health And Safety Code Section 128475-128501



128475. (a) The Legislature hereby finds and declares that an adequate supply of professional vocational nurses is critical to assuring the health and well-being of the citizens of California, particularly those who live in medically underserved areas, and that changes in the health care system of this state have increased the need for more highly skilled vocational nurses. (b) The Legislature further finds and declares that in March 2002, the California Association of Health Facilities indicated that there is a shortage of 3,500 vocational nurses in long-term care facilities and estimates that 28,000 additional vocational nurses will be needed in long-term care over the next 10 years, that recently published reports indicate that vocational nurses now comprise almost 30 percent of the nation's total number of nurses and that the national vacancy rate in hospitals was about 13 percent, and that according to the California Association of Psychiatric Technicians, an additional 800 psychiatric technicians are needed due to expanding health facilities. (c) The Legislature further finds and declares that in vocational nursing, as in other professions, certain populations are underrepresented. The Legislature also finds and declares that it is especially important that vocational nursing care be provided in a way that is sensitive to the sociocultural variables that affect a person's health. The Legislature recognizes that the financial burden of attending a school of vocational nursing is considerable and that persons from families lacking adequate financial resources may need financial assistance to complete their studies. (d) The Legislature further finds and declares that approximately 54.1 percent of all Californians live in rural and urban areas that have been designated underserved. The shortage of vocational nurses in these areas makes it more difficult for those citizens to obtain health care and more difficult to attract and retain other health care professionals to those areas.


128480. It is the intent of the Legislature to accomplish the following: (a) Assure an adequate supply of appropriately trained vocational nurses. (b) Encourage persons from populations that are currently underrepresented in the profession of vocational nursing to enter that profession. (c) Encourage vocational nurses to work in medically underserved areas.

128485. There is hereby created the Vocational Nurse Education Program within the Health Professions Education Foundation. Persons participating in this program shall be persons who agree in writing prior to completion of vocational nursing school to serve in an eligible county health facility, an eligible state-operated health facility, or a health workforce shortage area, as designated by the director of the office. Persons agreeing to serve in eligible county health facilities, eligible state-operated health facilities, or health workforce shortage areas may apply for scholarship or loan repayment. The Vocational Nurse Education Program shall be administered in accordance with Article 1 (commencing with Section 128330), except that all funds in the Vocational Nurse Education Fund shall be used only for the purpose of promoting the education of vocational nurses and related administrative costs. The Health Professions Education Foundation shall make recommendations to the director of the office concerning both of the following: (a) A standard contractual agreement to be signed by the director and any student who has received an award to work in an eligible county health facility, an eligible state-operated health facility, or in a health workforce shortage area that would require a period of obligated professional service in the areas of California designated by the Health Workforce Policy Commission as deficient in primary care services. The obligated professional service shall be in direct patient care. The agreement shall include a clause entitling the state to recover the funds awarded plus the maximum allowable interest for failure to begin or complete the service obligation. (b) Maximum allowable amounts for scholarships, educational loans, and loan repayment programs in order to assure the most effective use of these funds. (c) A person who qualifies for admission to a vocational nursing program that is accredited by the board of Vocational Nursing and Psychiatric Technicians may apply for funding under the Vocational Nurse Education Program by establishing a contractual agreement in accordance with subdivision (a). (d) A person who holds a current valid license as a vocational nurse who wishes to seek an associate of science degree in nursing from an accredited college may apply for funding under the Vocational Nurse Education Program by establishing a contractual agreement in accordance with subdivision (a) unless the person is able to qualify under subdivision (a) of Section 128385 under the Registered Nurse Education Program.


128495. In developing this program, the Health Professions Education Foundation shall solicit the advice of representatives of the Board of Vocational Nurses and Psychiatric Technicians, the California Licensed Vocational Nurses' Association, the Licensed Vocational Nurses League of California, Inc., and other vocational nurse organizations, the Chancellor of the California Community Colleges and other vocational schools, and the California Association of Hospitals and Health Systems. The foundation shall solicit the advice of representatives who reflect the demographic diversity of California.

128500. There is hereby established in the State Treasury the Vocational Nurse Education Fund. All money in the fund shall be used for the purposes specified in the California Vocational Nurse Education Program established pursuant to this article. This fund shall receive money collected pursuant to subdivision (d) of Section 2895 of the Business and Professions Code.


128501. This article shall become operative on July 1, 2004.


Article 5. California Physician Corps Program

Ca Codes (hsc:128550-128558) Health And Safety Code Section 128550-128558



128550. (a) There is hereby established within the Health Professions Education Foundation, the California Physician Corps Program. (b) Commencing July 1, 2006, both of the following programs shall be transferred from the Medical Board of California to the California Physician Corps Program within the foundation and operated pursuant to this article: (1) The Steven M. Thompson Physician Corps Loan Repayment Program. (2) The Physician Volunteer Program developed by the Medical Board of California. (c) The office may enter into an interagency agreement with the Medical Board of California to implement the transfer of programs as provided under subdivision (b).


128551. (a) It is the intent of this article that the Health Professions Education Foundation and the office provide the ongoing program management of the two programs identified in subdivision (b) of Section 128550 as a part of the California Physician Corps Program. (b) For purposes of subdivision (a), the foundation shall consult with the Medical Board of California, Office of Statewide Planning and Development, and shall establish and consult with an advisory committee of not more than seven members, that shall include two members recommended by the California Medical Association and may include other members of the medical community, including ethnic representatives, medical schools, health advocates representing ethnic communities, primary care clinics, public hospitals, and health systems, statewide agencies administering state and federally funded programs targeting underserved communities, and members of the public with expertise in health care issues.


128552. For purposes of this article, the following definitions shall apply: (a) "Account" means the Medically Underserved Account for Physicians established within the Health Professions Education Fund pursuant to this article. (b) "Foundation" means the Health Professions Education Foundation. (c) "Fund" means the Health Professions Education Fund. (d) "Medi-Cal threshold languages" means primary languages spoken by limited-English-proficient (LEP) population groups meeting a numeric threshold of 3,000, eligible LEP Medi-Cal beneficiaries residing in a county, 1,000 Medi-Cal eligible LEP beneficiaries residing in a single ZIP Code, or 1,500 LEP Medi-Cal beneficiaries residing in two contiguous ZIP Codes. (e) "Medically underserved area" means an area defined as a health professional shortage area in Part 5 of Subchapter A of Chapter 1 of Title 42 of the Code of Federal Regulations or an area of the state where unmet priority needs for physicians exist as determined by the California Healthcare Workforce Policy Commission pursuant to Section 128225. (f) "Medically underserved population" means the Medi-Cal program, Healthy Families Program, and uninsured populations. (g) "Office" means the Office of Statewide Health Planning and Development (OSHPD). (h) "Physician Volunteer Program" means the Physician Volunteer Registry Program established by the Medical Board of California. (i) "Practice setting" means either of the following: (1) A community clinic as defined in subdivision (a) of Section 1204 and subdivision (c) of Section 1206, a clinic owned or operated by a public hospital and health system, or a clinic owned and operated by a hospital that maintains the primary contract with a county government to fulfill the county's role pursuant to Section 17000 of the Welfare and Institutions Code, which is located in a medically underserved area and at least 50 percent of whose patients are from a medically underserved population. (2) A medical practice located in a medically underserved area and at least 50 percent of whose patients are from a medically underserved population. (j) "Primary specialty" means family practice, internal medicine, pediatrics, or obstetrics/gynecology. (k) "Program" means the Steven M. Thompson Physician Corps Loan Repayment Program. (l) "Selection committee" means a minimum three-member committee of the board, that includes a member that was appointed by the Medical Board of California.


128553. (a) Program applicants shall possess a current valid license to practice medicine in this state issued pursuant to Section 2050 of the Business and Professions Code or pursuant to the Osteopathic Act. (b) The foundation, in consultation with those identified in subdivision (b) of Section 123551, shall use guidelines developed by the Medical Board of California for selection and placement of applicants until the office adopts other guidelines by regulation. The foundation shall interpret the guidelines to apply to both osteopathic and allopathic physicians and surgeons. (c) The guidelines shall meet all of the following criteria: (1) Provide priority consideration to applicants that are best suited to meet the cultural and linguistic needs and demands of patients from medically underserved populations and who meet one or more of the following criteria: (A) Speak a Medi-Cal threshold language. (B) Come from an economically disadvantaged background. (C) Have received significant training in cultural and linguistically appropriate service delivery. (D) Have three years of experience working in medically underserved areas or with medically underserved populations. (E) Have recently obtained a license to practice medicine. (2) Include a process for determining the needs for physician services identified by the practice setting and for ensuring that the practice setting meets the definition specified in subdivision (h) of Section 128552. (3) Give preference to applicants who have completed a three-year residency in a primary specialty. (4) Seek to place the most qualified applicants under this section in the areas with the greatest need. (5) Include a factor ensuring geographic distribution of placements. (6) Provide priority consideration to applicants who agree to practice in a geriatric care setting and are trained in geriatrics, and who can meet the cultural and linguistic needs and demands of a diverse population of older Californians. On and after January 1, 2009, up to 15 percent of the funds collected pursuant to Section 2436.5 of the Business and Professions Code shall be dedicated to loan assistance for physicians and surgeons who agree to practice in geriatric care settings or settings that primarily serve adults over the age of 65 years or adults with disabilities. (d) (1) The foundation may appoint a selection committee that provides policy direction and guidance over the program and that complies with the requirements of subdivision (l) of Section 128552. (2) The selection committee may fill up to 20 percent of the available positions with program applicants from specialties outside of the primary care specialties. (e) Program participants shall meet all of the following requirements: (1) Shall be working in or have a signed agreement with an eligible practice setting. (2) Shall have full-time status at the practice setting. Full-time status shall be defined by the board and the selection committee may establish exemptions from this requirement on a case-by-case basis. (3) Shall commit to a minimum of three years of service in a medically underserved area. Leaves of absence shall be permitted for serious illness, pregnancy, or other natural causes. The selection committee shall develop the process for determining the maximum permissible length of an absence and the process for reinstatement. Loan repayment shall be deferred until the physician is back to full-time status. (f) The office shall adopt a process that applies if a physician is unable to complete his or her three-year obligation. (g) The foundation, in consultation with those identified in subdivision (b) of Section 128551, shall develop a process for outreach to potentially eligible applicants. (h) The foundation may recommend to the office any other standards of eligibility, placement, and termination appropriate to achieve the aim of providing competent health care services in approved practice settings.


128554. (a) Any regulation adopted by the Medical Board of California relating to the administration of the program or the Physician Volunteer Program shall remain in effect and shall be deemed to be a regulation of the office. The office may thereafter amend or repeal any part of those regulations or adopt any other regulations it deems appropriate to implement this article in accordance with the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. (b) The adoption, amendment, repeal, or readoption of a regulation authorized by this section is deemed to be necessary for the immediate preservation of the public peace, health and safety, or general welfare, for purposes of Sections 11346.1 and 11349.6 of the Government Code, and the office is hereby exempted from the requirement that it describe specific facts showing the need for immediate action. For purposes of subdivision (e) of Section 11346.1 of the Government Code, the 120-day period, as applicable to the effective period of an emergency regulatory action and submission of specified materials to the Office of Administrative Law, is hereby extended to 180 days.


128555. (a) The Medically Underserved Account for Physicians is hereby established within the Health Professions Education Fund. The primary purpose of this account is to provide funding for the ongoing operations of the Steven M. Thompson Physician Corps Loan Repayment Program provided for under this article. This account also may be used to provide funding for the Physician Volunteer Program provided for under this article. (b) All moneys in the Medically Underserved Account contained within the Contingent Fund of the Medical Board of California shall be transferred to the Medically Underserved Account for Physicians on July 1, 2006. (c) Funds in the account shall be used to repay loans as follows per agreements made with physicians: (1) Funds paid out for loan repayment may have a funding match from foundations or other private sources. (2) Loan repayments may not exceed one hundred five thousand dollars ($105,000) per individual licensed physician. (3) Loan repayments may not exceed the amount of the educational loans incurred by the physician participant. (d) Notwithstanding Section 11105 of the Government Code, effective January 1, 2006, the foundation may seek and receive matching funds from foundations and private sources to be placed in the account. "Matching funds" shall not be construed to be limited to a dollar-for-dollar match of funds. (e) Funds placed in the account for purposes of this article, including funds received pursuant to subdivision (d), are, notwithstanding Section 13340 of the Government Code, continuously appropriated for the repayment of loans. This subdivision shall not apply to funds placed in the account pursuant to Section 1341.45. (f) The account shall also be used to pay for the cost of administering the program and for any other purpose authorized by this article. The costs for administration of the program may be up to 5 percent of the total state appropriation for the program and shall be subject to review and approval annually through the state budget process. This limitation shall only apply to the state appropriation for the program. (g) The office and the foundation shall manage the account established by this section prudently in accordance with the other provisions of law.


128556. The terms of loan repayment granted under this article shall be as follows: (a) After a program participant has completed one year of providing services as a physician in a medically underserved area, up to twenty-five thousand dollars ($25,000) for loan repayment shall be provided. (b) After a program participant has completed two consecutive years of providing services as a physician in a medically underserved area, an additional amount of loan repayment up to thirty-five thousand dollars ($35,000) shall be provided, for a total loan repayment of up to sixty thousand dollars ($60,000). (c) After a program participant has completed three consecutive years of providing services as a physician in a medically underserved area, an additional amount of loan repayment up to forty-five thousand dollars ($45,000) shall be provided, for a total loan repayment of up to one hundred five thousand dollars ($105,000).


128557. (a) The foundation shall submit to the Legislature an annual report that includes all of the following: (1) The number of program participants. (2) The name and location of all practice settings with program participants. (3) The amount expended for the program. (4) Information on annual performance reviews by the practice settings and program participants. (5) Status and statistics on the Physician Volunteer Program. (b) The foundation shall include the information required in subdivision (a) in its annual report required pursuant to subdivision (g) of Section 128345.


128557.5. On or before January 1, 2010, the foundation, the office, the Medical Board of California, and the advisory committee described in Section 128551 shall evaluate the success of the programs' operation and the foundation's fundraising and shall make recommendations to the Legislature for improvements to the programs or for the programs to be carried out by another agency or a foundation to be established within the Medical Board of California.


128558. This article shall become operative on July 1, 2006.


Part 4. Health Care Demonstration Projects

Chapter 2. Postsurgical Care Demonstration Project

Ca Codes (hsc:128600-128605) Health And Safety Code Section 128600-128605



128600. The Legislature finds and declares that the oversight and reporting requirements of the demonstration project established in this section are equal to, or exceed similar licensing standards for other health facilities. (a) The Office of Statewide Health Planning and Development shall conduct a demonstration project to evaluate the accommodation of postsurgical care patients for periods not exceeding two days, except that the attending physician and surgeon may require that the stay be extended to no more than three days. (b) (1) The demonstration project shall operate for a period not to exceed six years, for no more than 12 project sites, one of which shall be located in Fresno County. However, the demonstration project shall be extended an additional six years, to September 30, 2000, only for those project sites that were approved by the Office of Statewide Health Planning and Development and operational prior to January 1, 1994. (2) Any of the 12 project sites may be distinct parts of health facilities, or any of those sites may be physically freestanding from health facilities. None of the project sites that are designated as distinct parts of health facilities, shall be located in the service area of any one of the six freestanding project sites. None of the project sites that are designated as distinct parts of health facilities shall have a service area that overlaps with any one or more service areas of the freestanding pilot sites. For the purposes of this section, service area shall be defined by the office. (c) (1) The office shall establish standards for participation, commensurate with the needs of postsurgical care patients requiring temporary nursing services following outpatient surgical procedures. (2) In preparing the standards for participation, the office may, as appropriate, consult with the State Department of Health Services and a technical advisory committee that may be appointed by the Director of the Office of Statewide Health Planning and Development. The committee shall have no more than eight members, all of whom shall be experts in health care, as determined by the director of the office. One of the members of the committee shall, as determined by the director of the office, have specific expertise in the area of pediatric surgery and recovery care. (3) If a technical advisory committee is established by the director of the office, members of the committee shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of the committee. (d) Not later than six months prior to the conclusion of the demonstration project, the office shall submit an evaluation of the demonstration project to the Legislature on the effectiveness and safety of the demonstration project in providing recovery services to patients receiving outpatient surgical services. The office, as part of the evaluation, shall include recommendations regarding the establishment of a new license category or amendment of existing licensing standards. (e) The office shall establish and administer the demonstration project in facilities with no more than 20 beds that continuously meet the standards of skilled nursing facilities licensed under subdivision (c) of Section 1250, except that the office may, as appropriate and unless a danger to patients would be created, eliminate or modify the standards. This section shall not prohibit general acute care hospitals from participating in the demonstration project. The office may waive those building standards applicable to a project site that is a distinct part of a health facility that are inappropriate, as determined by the office, to the demonstration project. Notwithstanding health facility licensing regulations contained in Division 5 (commencing with Section 70001) of Title 22 of the California Code of Regulations, a project site that is a distinct part of a health facility shall comply with all standards for participation established by the office and with all regulations adopted by the office to implement this section. A project site that is a distinct part of a health facility shall not, for the duration of the pilot project, be subject to Division 5 (commencing with Section 70001) of Title 22 of the California Code of Regulations which conflict, as determined by the office, with the demonstration project standards or regulations. (f) The office shall issue a facility identification number to each facility selected for participation in the demonstration project. (g) Persons who wish to establish recovery care programs shall make application to the office for inclusion in the pilot program. Applications shall be made on forms provided by the office and shall contain sufficient information determined as necessary by the office. (h) As a condition of participation in the pilot program, each applicant shall agree to provide statistical data and patient information that the office deems necessary for effective evaluation. It is the intent of the Legislature that the office shall develop procedures to assure the confidentiality of patient information and shall only disclose patient information, including name identification, as is necessary pursuant to this section or any other law. (i) Any authorized officer, employee, or agent of the office may, upon presentation of proper identification, enter and inspect any building or premises and any records, including patient records, of a pilot project participant at any reasonable time to review compliance with, or to prevent any violation of, this section or the regulations and standards adopted thereunder. (j) The office may suspend or withdraw approval of any or all pilot projects with notice, but without hearing if it determines that patient safety is being jeopardized. (k) The office may charge applicants and participants in the program a reasonable fee to cover its actual cost of administering the pilot program and the cost of any committee established by this section. The facilities participating in the pilot project shall pay fees that equal the amount of any increase in fiscal costs incurred by the state as a result of the extension of the pilot project until September 30, 2000, pursuant to subdivision (b). ( l) The office may contract with a medical consultant or other advisers as necessary, as determined by the office. Due to the necessity to expedite the demonstration project and its extremely specialized nature, the contracts shall be exempt from Section 10373 of the Public Contract Code, and shall be considered sole-source contracts. (m) The office may adopt emergency regulations to implement this section in accordance with Section 11346.1 of the Government Code, except that the regulations shall be exempt from the requirements of subdivisions (e), (f), and (g) of that section. The regulations shall be deemed an emergency for the purposes of Section 11346.1. Applications to establish any of the four project sites authorized by the amendments made to this section during the 1987-88 Regular Session of the California Legislature shall be considered by the office from among the applications submitted to it in response to its initial request for proposal process. (n) Any administrative opinion, decision, waiver, permit, or finding issued by the office prior to July 1, 1990, with respect to any of the demonstration projects approved by the office prior to July 1, 1990, shall automatically be extended by the office to remain fully effective as long as the demonstration projects are required to operate pursuant to this section. (o) The office shall not grant approval to a postsurgical recovery care facility, as defined in Section 97500.111 of Title 22 of the California Code of Regulations, that is freestanding, as defined in Section 97500.49 of Title 22 of the California Code of Regulations, to begin operation as a participating demonstration project if it is located in the County of Solano. (p) Participants in the demonstration program for postsurgical recovery facilities shall not be precluded from receiving reimbursement from, or conducting good faith negotiations with, a third-party payor solely on the basis that the participant is engaged in a demonstration program and accordingly is not licensed.


128605. (a) In addition to the 12 postsurgical care demonstration project sites authorized in Section 128600, the office may approve one additional freestanding demonstration project, in accordance with the requirements of Section 128600, in a site that is in a rural area. For the purposes of this section, "rural area" means any area of the state that is not in a metropolitan statistical area as described in the publication "State and Metropolitan Area Data Book," 1986, published by the United States Department of Commerce. (b) In order to receive applications for this one additional rural project site, the office shall accept additional applications until October 31, 1988.


Part 5. Health Data

Chapter 1. Health Facility Data

Ca Codes (hsc:128675-128810) Health And Safety Code Section 128675-128810



128675. This chapter shall be known as the Health Data and Advisory Council Consolidation Act.


128680. The Legislature hereby finds and declares that: (a) Significant changes have taken place in recent years in the health care marketplace and in the manner of reimbursement to health facilities by government and private third-party payers for the services they provide. (b) These changes have permitted the state to reevaluate the need for, and the manner of data collection from health facilities by the various state agencies and commissions. (c) It is the intent of the Legislature that as a result of this reevaluation that the data collection function be consolidated in a single state agency. It is the further intent of the Legislature that the single state agency only collect that data from health facilities that are essential. The data should be collected, to the extent practical on consolidated, multipurpose report forms for use by all state agencies. (d) It is the further intent of the Legislature to eliminate the California Health Facilities Commission and the State Advisory Health Council, and to create a single advisory commission to assume consolidated data collection and planning functions. (e) It is the Legislature's further intent that the review of the data that the state collects be an ongoing function. The office, with the advice of the advisory commission, shall annually review this data for need and shall revise, add, or delete items as necessary. The commission and the office shall consult with affected state agencies and the affected industry when adding or eliminating data items. However, the office shall neither add nor delete data items to the Hospital Discharge Abstract Data Record or the quarterly reports without prior authorizing legislation, unless specifically required by federal law or judicial decision. (f) The Legislature recognizes that the authority for the California Health Facilities Commission is scheduled to expire January 1, 1986. It is the intent of the Legislature, by the enactment of this chapter, to continue the uniform system of accounting and reporting established by the commission and required for use by health facilities. It is also the intent of the Legislature to continue an appropriate, cost-disclosure program.


128681. The office shall conduct, under contract with a qualified consulting firm, a comprehensive review of the financial and utilization reports that hospitals are required to file with the office and similar reports required by other departments of state government, as appropriate. The contracting consulting firm shall have a strong commitment to public health and health care issues, and shall demonstrate fiscal management and analytical expertise. The purpose of the review is to identify opportunities to eliminate the collection of data that no longer serve any significant purpose, to reduce the redundant reporting of similar data to different departments, and to consolidate reports wherever practical. The contracting consulting firm shall evaluate specific reporting requirements, exceptions to and exemptions from the requirements, and areas of duplication or overlap within the requirements. The contracting consulting firm shall consult with a broad range of data users, including, but not limited to, consumers, payers, purchasers, providers, employers, employees, and the organizations that represent the data users. It is expected that the review will result in greater efficiency in collecting and disseminating needed hospital information to the public and will reduce hospital costs and administrative burdens associated with reporting the information.


128685. Intermediate care facilities/developmentally disabled-habilitative, as defined in subdivision (e) of Section 1250, are not subject to this chapter.

128690. Intermediate care facilities/developmentally disabled--nursing, as defined in subdivision (h) of Section 1250, are not subject to this chapter.

128695. There is hereby created the California Health Policy and Data Advisory Commission to be composed of 13 members. The Governor shall appoint nine members, one of whom shall be a hospital chief executive officer, one of whom shall be a chief executive officer of a hospital serving a disproportionate share of low-income patients, one of whom shall be a long-term care facility chief executive officer, one of whom shall be a freestanding ambulatory surgery clinic chief executive officer, one of whom shall be a representative of the health insurance industry involved in establishing premiums or underwriting, one of whom shall be a representative of a group prepayment health care service plan, one of whom shall be a representative of a business coalition concerned with health, and two of whom shall be general members. The Speaker of the Assembly shall appoint two members, one of whom shall be a physician and surgeon and one of whom shall be a general member. The Senate Rules Committee shall appoint two members, one of whom shall be a representative of a labor coalition concerned with health, and one of whom shall be a general member. The Governor shall designate a member to serve as chairperson for a two-year term. No member may serve more than two, two-year terms as chairperson. All appointments shall be for four-year terms. No individual shall serve more than two, four-year terms.


128700. As used in this chapter, the following terms mean: (a) "Ambulatory surgery procedures" mean those procedures performed on an outpatient basis in the general operating rooms, ambulatory surgery rooms, endoscopy units, or cardiac catheterization laboratories of a hospital or a freestanding ambulatory surgery clinic. (b) "Commission" means the California Health Policy and Data Advisory Commission. (c) "Emergency department" means, in a hospital licensed to provide emergency medical services, the location in which those services are provided. (d) "Encounter" means a face-to-face contact between a patient and the provider who has primary responsibility for assessing and treating the condition of the patient at a given contact and exercises independent judgment in the care of the patient. (e) "Freestanding ambulatory surgery clinic" means a surgical clinic that is licensed by the state under paragraph (1) of subdivision (b) of Section 1204. (f) "Health facility" or "health facilities" means all health facilities required to be licensed pursuant to Chapter 2 (commencing with Section 1250) of Division 2. (g) "Hospital" means all health facilities except skilled nursing, intermediate care, and congregate living health facilities. (h) "Office" means the Office of Statewide Health Planning and Development. (i) "Risk-adjusted outcomes" means the clinical outcomes of patients grouped by diagnoses or procedures that have been adjusted for demographic and clinical factors.

128705. On and after January 1, 1986, any reference in this code to the Advisory Health Council shall be deemed a reference to the California Health Policy and Data Advisory Commission.


128710. The California Health Policy and Data Advisory Commission shall meet at least once every two months, or more often if necessary to fulfill its duties.


128715. The members of the commission shall receive per diem of one hundred dollars ($100) for each day actually spent in the discharge of official duties and shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of the commission.


128720. The commission may appoint an executive secretary subject to approval by the Secretary of Health and Welfare. The office shall provide other staff to the commission as the office and the commission deem necessary.

128725. The functions and duties of the commission shall include the following: (a) Advise the office on the implementation of the new, consolidated data system. (b) Advise the office regarding the ongoing need to collect and report health facility data and other provider data. (c) Annually develop a report to the director of the office regarding changes that should be made to existing data collection systems and forms. Copies of the report shall be provided to the Senate Health and Human Services Committee and to the Assembly Health Committee. (d) Advise the office regarding changes to the uniform accounting and reporting systems for health facilities. (e) Conduct public meetings for the purposes of obtaining input from health facilities, other providers, data users, and the general public regarding this chapter and Chapter 1 (commencing with Section 127125) of Part 2 of Division 107. (f) Advise the Secretary of Health and Welfare on the formulation of general policies which shall advance the purposes of this part. (g) Advise the office on the adoption, amendment, or repeal of regulations it proposes prior to their submittal to the Office of Administrative Law. (h) Advise the office on the format of individual health facility or other provider data reports and on any technical and procedural issues necessary to implement this part. (i) Advise the office on the formulation of general policies which shall advance the purposes of Chapter 1 (commencing with Section 127125) of Part 2 of Division 107. (j) Recommend, in consultation with a 12-member technical advisory committee appointed by the chairperson of the commission, to the office the data elements necessary for the production of outcome reports required by Section 128745. (k) (1) The technical advisory committee appointed pursuant to subdivision (j) shall be composed of two members who shall be hospital representatives appointed from a list of at least six persons nominated by the California Association of Hospitals and Health Systems, two members who shall be physicians and surgeons appointed from a list of at least six persons nominated by the California Medical Association, two members who shall be registered nurses appointed from a list of at least six persons nominated by the California Nurses Association, one medical record practitioner who shall be appointed from a list of at least six persons nominated by the California Health Information Association, one member who shall be a representative of a hospital authorized to report as a group pursuant to subdivision (d) of Section 128760, two members who shall be representative of California research organizations experienced in effectiveness review of medical procedures or surgical procedures, or both procedures, one member representing the Health Access Foundation, and one member representing the Consumers Union. Members of the technical advisory committee shall serve without compensation, but shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of the technical advisory committee. (2) The commission shall submit its recommendation to the office regarding the first of the reports required pursuant to subdivision (a) of Section 128745 no later than January 1, 1993. The technical advisory committee shall submit its initial recommendations to the commission pursuant to subdivision (d) of Section 128750 no later than January 1, 1994. The commission, with the advice of the technical advisory committee, may periodically make additional recommendations under Sections 128745 and 128750 to the office, as appropriate. ( l) (1) Assess the value and usefulness of the reports required by Sections 127285, 128735, and 128740. On or before December 1, 1997, the commission shall submit recommendations to the office to accomplish all of the following: (A) Eliminate redundant reporting. (B) Eliminate collection of unnecessary data. (C) Augment data bases as deemed valuable to enhance the quality and usefulness of data. (D) Standardize data elements and definitions with other health data collection programs at both the state and national levels. (E) Enable linkage with, and utilization of, existing data sets. (F) Improve the methodology and data bases used for quality assessment analyses, including, but not limited to, risk-adjusted outcome reports. (G) Improve the timeliness of reporting and public disclosure. (2) The commission shall establish a committee to implement the evaluation process. The committee shall include representatives from the health care industry, providers, consumers, payers, purchasers, and government entities, including the Department of Managed Health Care, the departments that comprise the Health and Welfare Agency, and others deemed by the commission to be appropriate to the evaluation of the data bases. The committee may establish subcommittees including technical experts. (3) In order to ensure the timely implementation of the provisions of the legislation enacted in the 1997-98 Regular Session that amended this part, the office shall present an implementation work plan to the commission. The work plan shall clearly define goals and significant steps within specified timeframes that must be completed in order to accomplish the purposes of that legislation. The office shall make periodic progress reports based on the work plan to the commission. The commission may advise the Secretary of Health and Welfare of any significant delays in following the work plan. If the commission determines that the office is not making significant progress toward achieving the goals outlined in the work plan, the commission shall notify the office and the secretary of that determination. The commission may request the office to submit a plan of correction outlining specific remedial actions and timeframes for compliance. Within 90 days of notification, the office shall submit a plan of correction to the commission. (m) (1) As the office and the commission deem necessary, the commission may establish committees and appoint persons who are not members of the commission to these committees as are necessary to carry out the purposes of the commission. Representatives of area health planning agencies shall be invited, as appropriate, to serve on committees established by the office and the commission relative to the duties and responsibilities of area health planning agencies. Members of the standing committees shall serve without compensation, but shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of these committees. (2) Whenever the office or the commission does not accept the advice of the other body on proposed regulations or on major policy issues, the office or the commission shall provide a written response on its action to the other body within 30 days, if so requested. (3) The commission or the office director may appeal to the Secretary of Health and Welfare over disagreements on policy, procedural, or technical issues.


128730. (a) Effective January 1, 1986, the office shall be the single state agency designated to collect the following health facility or clinic data for use by all state agencies: (1) That data required by the office pursuant to Section 127285. (2) That data required in the Medi-Cal cost reports pursuant to Section 14170 of the Welfare and Institutions Code. (3) Those data items formerly required by the California Health Facilities Commission that are listed in Sections 128735 and 128740. Information collected pursuant to subdivision (g) of Section 128735 and Sections 128736 and 128737 shall be made available to the State Department of Health Care Services and the State Department of Public Health. The departments shall ensure that the patient's rights to confidentiality shall not be violated in any manner. The departments shall comply with all applicable policies and requirements involving review and oversight by the State Committee for the Protection of Human Subjects. (b) The office shall consolidate any and all of the reports listed under this section or Sections 128735 and 128740, to the extent feasible, to minimize the reporting burdens on hospitals, provided, however, that the office shall neither add nor delete data items from the Hospital Discharge Abstract Data Record or the quarterly reports without prior authorizing legislation, unless specifically required by federal law or regulation or judicial decision.


128735. An organization that operates, conducts, owns, or maintains a health facility, and the officers thereof, shall make and file with the office, at the times as the office shall require, all of the following reports on forms specified by the office that shall be in accord, if applicable, with the systems of accounting and uniform reporting required by this part, except that the reports required pursuant to subdivision (g) shall be limited to hospitals: (a) A balance sheet detailing the assets, liabilities, and net worth of the health facility at the end of its fiscal year. (b) A statement of income, expenses, and operating surplus or deficit for the annual fiscal period, and a statement of ancillary utilization and patient census. (c) A statement detailing patient revenue by payer, including, but not limited to, Medicare, Medi-Cal, and other payers, and revenue center, except that hospitals authorized to report as a group pursuant to subdivision (d) of Section 128760 are not required to report revenue by revenue center. (d) A statement of cashflows, including, but not limited to, ongoing and new capital expenditures and depreciation. (e) A statement reporting the information required in subdivisions (a), (b), (c), and (d) for each separately licensed health facility operated, conducted, or maintained by the reporting organization, except those hospitals authorized to report as a group pursuant to subdivision (d) of Section 128760. (f) Data reporting requirements established by the office shall be consistent with national standards, as applicable. (g) A Hospital Discharge Abstract Data Record that includes all of the following: (1) Date of birth. (2) Sex. (3) Race. (4) ZIP Code. (5) Principal language spoken. (6) Patient social security number, if it is contained in the patient's medical record. (7) Prehospital care and resuscitation, if any, including all of the following: (A) "Do not resuscitate" (DNR) order at admission. (B) "Do not resuscitate" (DNR) order after admission. (8) Admission date. (9) Source of admission. (10) Type of admission. (11) Discharge date. (12) Principal diagnosis and whether the condition was present at admission. (13) Other diagnoses and whether the conditions were present at admission. (14) External cause of injury. (15) Principal procedure and date. (16) Other procedures and dates. (17) Total charges. (18) Disposition of patient. (19) Expected source of payment. (20) Elements added pursuant to Section 128738. (h) It is the intent of the Legislature that the patient's rights of confidentiality shall not be violated in any manner. Patient social security numbers and other data elements that the office believes could be used to determine the identity of an individual patient shall be exempt from the disclosure requirements of the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code). (i) A person reporting data pursuant to this section shall not be liable for damages in an action based on the use or misuse of patient-identifiable data that has been mailed or otherwise transmitted to the office pursuant to the requirements of subdivision (g). (j) A hospital shall use coding from the International Classification of Diseases in reporting diagnoses and procedures.


128736. (a) Each hospital shall file an Emergency Care Data Record for each patient encounter in a hospital emergency department. The Emergency Care Data Record shall include all of the following: (1) Date of birth. (2) Sex. (3) Race. (4) Ethnicity. (5) Principal language spoken. (6) ZIP Code. (7) Patient social security number, if it is contained in the patient's medical record. (8) Service date. (9) Principal diagnosis. (10) Other diagnoses. (11) Principal external cause of injury. (12) Other external cause of injury. (13) Principal procedure. (14) Other procedures. (15) Disposition of patient. (16) Expected source of payment. (17) Elements added pursuant to Section 128738. (b) It is the expressed intent of the Legislature that the patient' s rights of confidentiality shall not be violated in any manner. Patient social security numbers and any other data elements that the office believes could be used to determine the identity of an individual patient shall be exempt from the disclosure requirements of the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code). (c) No person reporting data pursuant to this section shall be liable for damages in any action based on the use or misuse of patient-identifiable data that has been mailed or otherwise transmitted to the office pursuant to the requirements of subdivision (a). (d) Data reporting requirements established by the office shall be consistent with national standards as applicable. (e) This section shall become operative on January 1, 2004.


128737. (a) Each general acute care hospital and freestanding ambulatory surgery clinic shall file an Ambulatory Surgery Data Record for each patient encounter during which at least one ambulatory surgery procedure is performed. The Ambulatory Surgery Data Record shall include all of the following: (1) Date of birth. (2) Sex. (3) Race. (4) Ethnicity. (5) Principal language spoken. (6) ZIP Code. (7) Patient social security number, if it is contained in the patient's medical record. (8) Service date. (9) Principal diagnosis. (10) Other diagnoses. (11) Principal procedure. (12) Other procedures. (13) Principal external cause of injury, if known. (14) Other external cause of injury, if known. (15) Disposition of patient. (16) Expected source of payment. (17) Elements added pursuant to Section 128738. (b) It is the expressed intent of the Legislature that the patient' s rights of confidentiality shall not be violated in any manner. Patient social security numbers and any other data elements that the office believes could be used to determine the identity of an individual patient shall be exempt from the disclosure requirements of the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code). (c) No person reporting data pursuant to this section shall be liable for damages in any action based on the use or misuse of patient-identifiable data that has been mailed or otherwise transmitted to the office pursuant to the requirements of subdivision (a). (d) Data reporting requirements established by the office shall be consistent with national standards as applicable. (e) This section shall become operative on January 1, 2004.


128738. (a) The office, based upon review and recommendations of the commission and its appropriate committees, shall allow and provide for, in accordance with appropriate regulations, additions or deletions to the patient level data elements listed in subdivision (g) of Section 128735, Section 128736, and Section 128737, to meet the purposes of this chapter. (b) Prior to any additions or deletions, all of the following shall be considered: (1) Utilization of sampling to the maximum extent possible. (2) Feasibility of collecting data elements. (3) Costs and benefits of collection and submission of data. (4) Exchange of data elements as opposed to addition of data elements. (c) The office shall add no more than a net of 15 elements to each data set over any five-year period. Elements contained in the uniform claims transaction set or uniform billing form required by the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. Sec. 300gg) shall be exempt from the 15-element limit. (d) The commission and the office, in order to minimize costs and administrative burdens, shall consider the total number of data elements required from hospitals and freestanding ambulatory surgery clinics, and optimize the use of common data elements.


128740. (a) Commencing with the first calendar quarter of 1992, the following summary financial and utilization data shall be reported to the office by each hospital within 45 days of the end of every calendar quarter. Adjusted reports reflecting changes as a result of audited financial statements may be filed within four months of the close of the hospital's fiscal or calendar year. The quarterly summary financial and utilization data shall conform to the uniform description of accounts as contained in the Accounting and Reporting Manual for California Hospitals and shall include all of the following: (1) Number of licensed beds. (2) Average number of available beds. (3) Average number of staffed beds. (4) Number of discharges. (5) Number of inpatient days. (6) Number of outpatient visits. (7) Total operating expenses. (8) Total inpatient gross revenues by payer, including Medicare, Medi-Cal, county indigent programs, other third parties, and other payers. (9) Total outpatient gross revenues by payer, including Medicare, Medi-Cal, county indigent programs, other third parties, and other payers. (10) Deductions from revenue in total and by component, including the following: Medicare contractual adjustments, Medi-Cal contractual adjustments, and county indigent program contractual adjustments, other contractual adjustments, bad debts, charity care, restricted donations and subsidies for indigents, support for clinical teaching, teaching allowances, and other deductions. (11) Total capital expenditures. (12) Total net fixed assets. (13) Total number of inpatient days, outpatient visits, and discharges by payer, including Medicare, Medi-Cal, county indigent programs, other third parties, self-pay, charity, and other payers. (14) Total net patient revenues by payer including Medicare, Medi-Cal, county indigent programs, other third parties, and other payers. (15) Other operating revenue. (16) Nonoperating revenue net of nonoperating expenses. (b) Hospitals reporting pursuant to subdivision (d) of Section 128760 may provide the items in paragraphs (7), (8), (9), (10), (14), (15), and (16) of subdivision (a) on a group basis, as described in subdivision (d) of Section 128760. (c) The office shall make available at cost, to any person, a hard copy of any hospital report made pursuant to this section and in addition to hard copies, shall make available at cost, a computer tape of all reports made pursuant to this section within 105 days of the end of every calendar quarter. (d) The office, with the advice of the commission, shall adopt by regulation guidelines for the identification, assessment, and reporting of charity care services. In establishing the guidelines, the office shall consider the principles and practices recommended by professional health care industry accounting associations for differentiating between charity services and bad debts. The office shall further conduct the onsite validations of health facility accounting and reporting procedures and records as are necessary to assure that reported data are consistent with regulatory guidelines. This section shall become operative January 1, 1992.


128745. (a) Commencing July 1993, and annually thereafter, the office shall publish risk-adjusted outcome reports in accordance with the following schedule: Procedures and Publication Period Conditions Date Covered Covered July 1993 1988-90 3 July 1994 1989-91 6 July 1995 1990-92 9 Reports for subsequent years shall include conditions and procedures and cover periods as appropriate. (b) The procedures and conditions required to be reported under this chapter shall be divided among medical, surgical, and obstetric conditions or procedures and shall be selected by the office, based on the recommendations of the commission and the advice of the technical advisory committee set forth in subdivision (j) of Section 128725. The office shall publish the risk-adjusted outcome reports for surgical procedures by individual hospital and individual surgeon unless the office in consultation with the technical advisory committee and medical specialists in the relevant area of practice determines that it is not appropriate to report by individual surgeon. The office, in consultation with the technical advisory committee and medical specialists in the relevant area of practice, may decide to report nonsurgical procedures and conditions by individual physician when it is appropriate. The selections shall be in accordance with all of the following criteria: (1) The patient discharge abstract contains sufficient data to undertake a valid risk adjustment. The risk adjustment report shall ensure that public hospitals and other hospitals serving primarily low-income patients are not unfairly discriminated against. (2) The relative importance of the procedure and condition in terms of the cost of cases and the number of cases and the seriousness of the health consequences of the procedure or condition. (3) Ability to measure outcome and the likelihood that care influences outcome. (4) Reliability of the diagnostic and procedure data. (c) (1) In addition to any other established and pending reports, on or before July 1, 2002, the office shall publish a risk-adjusted outcome report for coronary artery bypass graft surgery by hospital for all hospitals opting to participate in the report. This report shall be updated on or before July 1, 2003. (2) In addition to any other established and pending reports, commencing July 1, 2004, and every year thereafter, the office shall publish risk-adjusted outcome reports for coronary artery bypass graft surgery for all coronary artery bypass graft surgeries performed in the state. In each year, the reports shall compare risk-adjusted outcomes by hospital, and in every other year, by hospital and cardiac surgeon. Upon the recommendation of the technical advisory committee based on statistical and technical considerations, information on individual hospitals and surgeons may be excluded from the reports. (3) Unless otherwise recommended by the clinical panel established by Section 128748, the office shall collect the same data used for the most recent risk-adjusted model developed for the California Coronary Artery Bypass Graft Mortality Reporting Program. Upon recommendation of the clinical panel, the office may add any clinical data elements included in the Society of Thoracic Surgeons' database. Prior to any additions from the Society of Thoracic Surgeons' database, the following factors shall be considered: (A) Utilization of sampling to the maximum extent possible. (B) Exchange of data elements as opposed to addition of data elements. (4) Upon recommendation of the clinical panel, the office may add, delete, or revise clinical data elements, but shall add no more than a net of six elements not included in the Society of Thoracic Surgeons' database, to the data set over any five-year period. Prior to any additions or deletions, all of the following factors shall be considered: (A) Utilization of sampling to the maximum extent possible. (B) Feasibility of collecting data elements. (C) Costs and benefits of collection and submission of data. (D) Exchange of data elements as opposed to addition of data elements. (5) The office shall collect the minimum data necessary for purposes of testing or validating a risk-adjusted model for the coronary artery bypass graft report. (6) Patient medical record numbers and any other data elements that the office believes could be used to determine the identity of an individual patient shall be exempt from the disclosure requirements of the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code). (d) The annual reports shall compare the risk-adjusted outcomes experienced by all patients treated for the selected conditions and procedures in each California hospital during the period covered by each report, to the outcomes expected. Outcomes shall be reported in the five following groupings for each hospital: (1) "Much higher than average outcomes," for hospitals with risk-adjusted outcomes much higher than the norm. (2) "Higher than average outcomes," for hospitals with risk-adjusted outcomes higher than the norm. (3) "Average outcomes," for hospitals with average risk-adjusted outcomes. (4) "Lower than average outcomes," for hospitals with risk-adjusted outcomes lower than the norm. (5) "Much lower than average outcomes," for hospitals with risk-adjusted outcomes much lower than the norm. (e) For coronary artery bypass graft surgery reports and any other outcome reports for which auditing is appropriate, the office shall conduct periodic auditing of data at hospitals. (f) The office shall publish in the annual reports required under this section the risk-adjusted mortality rate for each hospital and for those reports that include physician reporting, for each physician. (g) The office shall either include in the annual reports required under this section, or make separately available at cost to any person requesting it, risk-adjusted outcomes data assessing the statistical significance of hospital or physician data at each of the following three levels: 99-percent confidence level (0.01 p-value), 95-percent confidence level (0.05 p-value), and 90-percent confidence level (0.10 p-value). The office shall include any other analysis or comparisons of the data in the annual reports required under this section that the office deems appropriate to further the purposes of this chapter.

128747. Commencing July 1, 2002, and biennially thereafter, the office shall evaluate the impact of the office's published risk-adjusted outcome reports required by Sections 128745 and 128746 on mortality rates in California and on any other measure of quality the office deems appropriate. The office shall also coordinate with other state agencies in promoting prevention and educational initiatives on those reported procedures and conditions.


128748. (a) This section shall apply to any risk-adjusted outcome report that includes reporting of data by an individual physician. (b) (1) The office shall obtain data necessary to complete a risk-adjusted outcome report from hospitals. If necessary data for an outcome report is available only from the office of a physician and not the hospital where the patient received treatment, then the hospital shall make a reasonable effort to obtain the data from the physician's office and provide the data to the office. In the event that the office finds any errors, omissions, discrepancies, or other problems with submitted data, the office shall contact either the hospital or physician's office that maintains the data to resolve the problems. (2) The office shall collect the minimum data necessary for purposes of testing or validating a risk-adjusted model. Except for data collected for purposes of testing or validating a risk-adjusted model, the office shall not collect data for an outcome report nor issue an outcome report until the clinical panel established pursuant to this section has approved the risk-adjusted model. (c) For each risk-adjusted outcome report on a medical, surgical, or obstetric condition or procedure that includes reporting of data by an individual physician, the office director shall appoint a clinical panel, which shall have nine members. Three members shall be appointed from a list of three or more names submitted by the physician specialty society that most represents physicians performing the medical, surgical, and obstetric procedure for which data is collected. Three members shall be appointed from a list of three or more names submitted by the California Medical Association. Three members shall be appointed from lists of names submitted by consumer organizations. At least one-half of the appointees from the lists submitted by the physician specialty society and the California Medical Association, and at least one appointee from the lists submitted by consumer organizations, shall be experts in collecting and reporting outcome measurements for physicians or hospitals. The panel may include physicians from another state. The panel shall review and approve the development of the risk-adjustment model to be used in preparation of the outcome report. (d) For the clinical panel authorized by subdivision (c) for coronary artery bypass graft surgery, three members shall be appointed from a list of three or more names submitted by the California Chapter of the American College of Cardiology. Three members shall be appointed from list of three or more names submitted by the California Medical Association. Three members shall be appointed from lists of names submitted by consumer organizations. At least one-half of the appointees from the lists submitted by the California Chapter of the American College of Cardiology, and the California Medical Association, and at least one appointee from the lists submitted by consumer organizations, shall be experts in collecting and reporting outcome measurements for physicians and surgeons or hospitals. The panel may include physicians from another state. The panel shall review and approve the development of the risk-adjustment model to be used in preparation of the outcome report. (e) Any report that includes reporting by an individual physician shall include, at a minimum, the risk-adjusted outcome data for each physician. The office may also include in the report, after consultation with the clinical panel, any explanatory material, comparisons, groupings, and other information to facilitate consumer comprehension of the data. (f) Members of a clinical panel shall serve without compensation, but shall be reimbursed for any actual and necessary expenses incurred in connection with their duties as members of the clinical panel.


128750. (a) Prior to the public release of the annual outcome reports, the office shall furnish a preliminary report to each hospital that is included in the report. The office shall allow the hospital and chief of staff 60 days to review the outcome scores and compare the scores to other California hospitals. A hospital or its chief of staff that believes that the risk-adjusted outcomes do not accurately reflect the quality of care provided by the hospital may submit a statement to the office, within the 60 days, explaining why the outcomes do not accurately reflect the quality of care provided by the hospital. The statement shall be included in an appendix to the public report, and a notation that the hospital or its chief of staff has submitted a statement shall be displayed wherever the report presents outcome scores for the hospital. (b) (1) Prior to the public release of any outcome report that includes data by a physician, the office shall furnish a preliminary report to each physician that is included in the report. The office shall allow the physician 30 days from the date the office sends the report to the physician to review the outcome scores and compare the scores to other California physicians. A physician who believes that the risk-adjusted outcome does not accurately reflect the quality of care provided by the physician may submit a statement to the office within the 30 days, explaining why the outcomes do not accurately reflect the quality of care provided by the physician. (2) The office shall promptly review the physician's statement and shall respond to the physician with one of the following conclusions: (A) The physician's statement reveals a flaw in the accuracy of the reported data relating to the physician that materially diminishes the validity of the report. If this finding is made, the data for that physician shall not be included in the report until the flaw in the physician's data is corrected. (B) The physician's statement reveals a flaw in the risk-adjustment model that materially diminishes the value of the report for all physicians. If this finding is made, the report using that risk-adjustment model shall not be issued until the flaw is corrected. (C) The physician's statement does not reveal a flaw in either the accuracy of the reported data relating to the physician or the risk-adjustment model in which case the report shall be used, unless the physician chooses to use the procedure set forth in paragraph (3). (3) If a physician is not satisfied with the conclusion reached by the office, the physician shall notify the office of that fact. Upon receipt of the notice, the office shall forward the physician's statement to the appropriate clinical panel appointed pursuant to Section 128748. The office shall forward the physician's statement with any information identifying the physician or the physician's hospital redacted, or shall adopt other means to ensure the physician' s identity is not revealed to the panel. The clinical panel shall promptly review the physician statement and the conclusion of the office and shall respond by either upholding the conclusion or reaching one of the other conclusions set forth in this subdivision. The panel decision shall be the final determination regarding the physician's statement. The process set forth in this subdivision shall be completed within 60 days from the date the office sends the report to each physician included in the report. If a decision by either the office or the clinical panel cannot be reached within the 60-day period, then the outcome report may be issued but shall not include data for the physician submitting the statement. (c) The office shall, in addition to public reports, provide hospitals and the chiefs of staff of the medical staffs with a report containing additional detailed information derived from data summarized in the public outcome reports as an aid to internal quality assurance. (d) If, pursuant to the recommendations of the office, based on the advice of the commission, in response to the recommendations of the technical advisory committee made pursuant to subdivision (d) of this section, the Legislature subsequently amends Section 128735 to authorize the collection of additional discharge data elements, then the outcome reports for conditions and procedures for which sufficient data is not available from the current abstract record will be produced following the collection and analysis of the additional data elements. (e) The recommendations of the technical advisory committee for the addition of data elements to the discharge abstract should take into consideration the technical feasibility of developing reliable risk-adjustment factors for additional procedures and conditions as determined by the technical advisory committee with the advice of the research community, physicians and surgeons, hospitals, consumer or patient advocacy groups, and medical records personnel. (f) The technical advisory committee at a minimum shall identify a limited set of core clinical data elements to be collected for all of the added procedures and conditions and unique clinical variables necessary for risk adjustment of specific conditions and procedures selected for the outcomes report program. In addition, the committee should give careful consideration to the costs associated with the additional data collection and the value of the specific information to be collected. (g) The technical advisory committee shall also engage in a continuing process of data development and refinement applicable to both current and prospective outcome studies.


128755. (a) (1) Hospitals shall file the reports required by subdivisions (a), (b), (c), and (d) of Section 128735 with the office within four months after the close of the hospital's fiscal year except as provided in paragraph (2). (2) If a licensee relinquishes the facility license or puts the facility license in suspense, the last day of active licensure shall be deemed a fiscal year end. (3) The office shall make the reports filed pursuant to this subdivision available no later than three months after they were filed. (b) (1) Skilled nursing facilities, intermediate care facilities, intermediate care facilities/developmentally disabled, and congregate living facilities, including nursing facilities certified by the state department to participate in the Medi-Cal program, shall file the reports required by subdivisions (a), (b), (c), and (d) of Section 128735 with the office within four months after the close of the facility's fiscal year, except as provided in paragraph (2). (2) (A) If a licensee relinquishes the facility license or puts the facility licensure in suspense, the last day of active licensure shall be deemed a fiscal year end. (B) If a fiscal year end is created because the facility license is relinquished or put in suspense, the facility shall file the reports required by subdivisions (a), (b), (c), and (d) of Section 128735 within two months after the last day of active licensure. (3) The office shall make the reports filed pursuant to paragraph (1) available not later than three months after they are filed. (4) (A) Effective for fiscal years ending on or after December 31, 1991, the reports required by subdivisions (a), (b), (c), and (d) of Section 128735 shall be filed with the office by electronic media, as determined by the office. (B) Congregate living health facilities are exempt from the electronic media reporting requirements of subparagraph (A). (c) A hospital shall file the reports required by subdivision (g) of Section 128735 as follows: (1) For patient discharges on or after January 1, 1999, through December 31, 1999, the reports shall be filed semiannually by each hospital or its designee not later than six months after the end of each semiannual period, and shall be available from the office no later than six months after the date that the report was filed. (2) For patient discharges on or after January 1, 2000, through December 31, 2000, the reports shall be filed semiannually by each hospital or its designee not later than three months after the end of each semiannual period. The reports shall be filed by electronic tape, diskette, or similar medium as approved by the office. The office shall approve or reject each report within 15 days of receiving it. If a report does not meet the standards established by the office, it shall not be approved as filed and shall be rejected. The report shall be considered not filed as of the date the facility is notified that the report is rejected. A report shall be available from the office no later than 15 days after the date that the report is approved. (3) For patient discharges on or after January 1, 2001, the reports shall be filed by each hospital or its designee for report periods and at times determined by the office. The reports shall be filed by online transmission in formats consistent with national standards for the exchange of electronic information. The office shall approve or reject each report within 15 days of receiving it. If a report does not meet the standards established by the office, it shall not be approved as filed and shall be rejected. The report shall be considered not filed as of the date the facility is notified that the report is rejected. A report shall be available from the office no later than 15 days after the date that the report is approved. (d) The reports required by subdivision (a) of Section 128736 shall be filed by each hospital for report periods and at times determined by the office. The reports shall be filed by online transmission in formats consistent with national standards for the exchange of electronic information. The office shall approve or reject each report within 15 days of receiving it. If a report does not meet the standards established by the office, it shall not be approved as filed and shall be rejected. The report shall be considered not filed as of the date the facility is notified that the report is rejected. A report shall be available from the office no later than 15 days after the report is approved. (e) The reports required by subdivision (a) of Section 128737 shall be filed by each hospital or freestanding ambulatory surgery clinic for report periods and at times determined by the office. The reports shall be filed by online transmission in formats consistent with national standards for the exchange of electronic information. The office shall approve or reject each report within 15 days of receiving it. If a report does not meet the standards established by the office, it shall not be approved as filed and shall be rejected. The report shall be considered not filed as of the date the facility is notified that the report is rejected. A report shall be available from the office no later than 15 days after the report is approved. (f) Facilities shall not be required to maintain a full-time electronic connection to the office for the purposes of online transmission of reports as specified in subdivisions (c), (d), and (e). The office may grant exemptions to the online transmission of data requirements for limited periods to facilities. An exemption may be granted only to a facility that submits a written request and documents or demonstrates a specific need for an exemption. Exemptions shall be granted for no more than one year at a time, and for no more than a total of five consecutive years. (g) The reports referred to in paragraph (2) of subdivision (a) of Section 128730 shall be filed with the office on the dates required by applicable law and shall be available from the office no later than six months after the date that the report was filed. (h) The office shall post on its Web site and make available to any person a copy of any report referred to in subdivision (a), (b), (c), (d), or (g) of Section 128735, subdivision (a) of Section 128736, subdivision (a) of Section 128737, Section 128740, and, in addition, shall make available in electronic formats reports referred to in subdivision (a), (b), (c), (d), or (g) of Section 128735, subdivision (a) of Section 128736, subdivision (a) of Section 128737, Section 128740, and subdivisions (a) and (c) of Section 128745, unless the office determines that an individual patient's rights of confidentiality would be violated. The office shall make the reports available at cost.


128760. (a) On and after January 1, 1986, those systems of health facility accounting and auditing formerly approved by the California Health Facilities Commission shall remain in full force and effect for use by health facilities but shall be maintained by the office with the advice of the Health Policy and Data Advisory Commission. (b) The office, with the advice of the commission, shall allow and provide, in accordance with appropriate regulations, for modifications in the accounting and reporting systems for use by health facilities in meeting the requirements of this chapter if the modifications are necessary to do any of the following: (1) To correctly reflect differences in size of, provision of, or payment for, services rendered by health facilities. (2) To correctly reflect differences in scope, type, or method of provision of, or payment for, services rendered by health facilities. (3) To avoid unduly burdensome costs for those health facilities in meeting the requirements of differences pursuant to paragraphs (1) and (2). (c) Modifications to discharge data reporting requirements. The office, with the advice of the commission, shall allow and provide, in accordance with appropriate regulations, for modifications to discharge data reporting format and frequency requirements if these modifications will not impair the office's ability to process the data or interfere with the purposes of this chapter. This modification authority shall not be construed to permit the office to administratively require the reporting of discharge data items not specified pursuant to Section 128735. (d) Modifications to emergency care data reporting requirements. The office, with the advice of the commission, shall allow and provide, in accordance with appropriate regulations, for modifications to emergency care data reporting format and frequency requirements if these modifications will not impair the office's ability to process the data or interfere with the purposes of this chapter. This modification authority shall not be construed to permit the office to require administratively the reporting of emergency care data items not specified in subdivision (a) of Section 128736. (e) Modifications to ambulatory surgery data reporting requirements. The office, with the advice of the commission, shall allow and provide, in accordance with appropriate regulations, for modifications to ambulatory surgery data reporting format and frequency requirements if these modifications will not impair the office's ability to process the data or interfere with the purposes of this chapter. The modification authority shall not be construed to permit the office to require administratively the reporting of ambulatory surgery data items not specified in subdivision (a) of Section 128737. (f) Reporting provisions for health facilities. The office, with the advice of the commission, shall establish specific reporting provisions for health facilities that receive a preponderance of their revenue from associated comprehensive group-practice prepayment health care service plans. These health facilities shall be authorized to utilize established accounting systems, and to report costs and revenues in a manner that is consistent with the operating principles of these plans and with generally accepted accounting principles. When these health facilities are operated as units of a coordinated group of health facilities under common management, they shall be authorized to report as a group rather than as individual institutions. As a group, they shall submit a consolidated income and expense statement. (g) Hospitals authorized to report as a group under this subdivision may elect to file cost data reports required under the regulations of the Social Security Administration in its administration of Title XVIII of the federal Social Security Act in lieu of any comparable cost reports required under Section 128735. However, to the extent that cost data is required from other hospitals, the cost data shall be reported for each individual institution. (h) The office, with the advice of the commission, shall adopt comparable modifications to the financial reporting requirements of this chapter for county hospital systems consistent with the purposes of this chapter.


128765. (a) The office, with the advice of the commission, shall maintain a file of all the reports filed under this chapter at its Sacramento office. Subject to any rules the office, with the advice of the commission, may prescribe, these reports shall be produced and made available for inspection upon the demand of any person, and shall also be posted on its Web site, with the exception of discharge and encounter data that shall be available for public inspection unless the office determines, pursuant to applicable law, that an individual patient's rights of confidentiality would be violated. (b) The reports published pursuant to Section 128745 shall include an executive summary, written in plain English to the maximum extent practicable, that shall include, but not be limited to, a discussion of findings, conclusions, and trends concerning the overall quality of medical outcomes, including a comparison to reports from prior years, for the procedure or condition studied by the report. The office shall disseminate the reports as widely as practical to interested parties, including, but not limited to, hospitals, providers, the media, purchasers of health care, consumer or patient advocacy groups, and individual consumers. The reports shall be posted on the office's Internet Web site. (c) Copies certified by the office as being true and correct copies of reports properly filed with the office pursuant to this chapter, together with summaries, compilations, or supplementary reports prepared by the office, shall be introduced as evidence, where relevant, at any hearing, investigation, or other proceeding held, made, or taken by any state, county, or local governmental agency, board, or commission that participates as a purchaser of health facility services pursuant to the provisions of a publicly financed state or federal health care program. Each of these state, county, or local governmental agencies, boards, and commissions shall weigh and consider the reports made available to it pursuant to the provisions of this subdivision in its formulation and implementation of policies, regulations, or procedures regarding reimbursement methods and rates in the administration of these publicly financed programs. (d) The office, with the advice of the commission, shall compile and publish summaries of individual facility and aggregate data that do not contain patient-specific information for the purpose of public disclosure. The summaries shall be posted on the office's Internet Web site. The commission shall approve the policies and procedures relative to the manner of data disclosure to the public. The office, with the advice of the commission, may initiate and conduct studies as it determines will advance the purposes of this chapter. (e) In order to assure that accurate and timely data are available to the public in useful formats, the office shall establish a public liaison function. The public liaison shall provide technical assistance to the general public on the uses and applications of individual and aggregate health facility data and shall provide the director and the commission with an annual report on changes that can be made to improve the public's access to data.


128766. (a) Notwithstanding Section 128765 or any other provision of law, the office, upon request, shall disclose information collected pursuant to subdivision (g) of Section 128735 and Sections 128736 and 128737, to any California hospital and any local health department or local health officer in California as set forth in Part 3 (commencing with Section 101000) of Division 101. The office shall disclose this same information to the National Center for Health Statistics or any other unit of the Centers for Disease Control and Prevention, or the Agency for Healthcare Research and Quality of the United States Department of Health and Human Services, for the purposes of conducting a statutorily authorized activity. All disclosures made pursuant to this section shall be consistent with the standards and limitations applicable to the disclosure of limited data sets as provided in Section 164.514 of Part 164 of Title 45 of the Code of Federal Regulations, relating to the privacy of health information. (b) Any hospital that receives information pursuant to this section shall not disclose that information to any person or entity, except in response to a court order, search warrant, or subpoena, or as otherwise required or permitted by the federal medical privacy regulations contained in Parts 160 and 164 of Title 45 of the Code of Federal Regulations. In no case shall a hospital, contractor, or subcontractor reidentify or attempt to reidentify any information received pursuant to this section. (c) No disclosure shall be made pursuant to this section if the director of the office has determined that the disclosure would create an unreasonable risk to patient privacy. The director shall provide a written explanation of the determination to the requester within 60 days.


128770. (a) Any health facility or freestanding ambulatory surgery clinic that does not file any report as required by this chapter with the office is liable for a civil penalty of one hundred dollars ($100) a day for each day the filing of any report is delayed. No penalty shall be imposed if an extension is granted in accordance with the guidelines and procedures established by the office, with the advice of the commission. (b) Any health facility that does not use an approved system of accounting pursuant to the provisions of this chapter for purposes of submitting financial and statistical reports as required by this chapter shall be liable for a civil penalty of not more than five thousand dollars ($5,000). (c) Civil penalties are to be assessed and recovered in a civil action brought in the name of the people of the State of California by the office. Assessment of a civil penalty may, at the request of any health facility or freestanding ambulatory surgery clinic, be reviewed on appeal, and the penalty may be reduced or waived for good cause. (d) Any money that is received by the office pursuant to this section shall be paid into the General Fund.


128775. (a) Any health facility or freestanding ambulatory surgery clinic affected by any determination made under this part by the office may petition the office for review of the decision. This petition shall be filed with the office within 15 business days, or within a greater time as the office, with the advice of the commission, may allow, and shall specifically describe the matters which are disputed by the petitioner. (b) A hearing shall be commenced within 60 calendar days of the date on which the petition was filed. The hearing shall be held before an employee of the office, an administrative law judge employed by the Office of Administrative Hearings, or a committee of the commission chosen by the chairperson for this purpose. If held before an employee of the office or a committee of the commission, the hearing shall be held in accordance with any procedures as the office, with the advice of the commission, shall prescribe. If held before an administrative law judge employed by the Office of Administrative Hearings, the hearing shall be held in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. The employee, administrative law judge, or committee shall prepare a recommended decision including findings of fact and conclusions of law and present it to the office for its adoption. The decision of the office shall be in writing and shall be final. The decision of the office shall be made within 60 calendar days after the conclusion of the hearing and shall be effective upon filing and service upon the petitioner. (c) Judicial review of any final action, determination, or decision may be had by any party to the proceedings as provided in Section 1094.5 of the Code of Civil Procedure. The decision of the office shall be upheld against a claim that its findings are not supported by the evidence unless the court determines that the findings are not supported by substantial evidence. (d) The employee of the office, the administrative law judge employed by the Office of Administrative Hearings, the Office of Administrative Hearings, or the committee of the commission may issue subpoenas and subpoenas duces tecum in a manner and subject to the conditions established by Article 11 (commencing with Section 11450.10) of Chapter 4.5 of Part 1 of Division 3 of Title 2 of the Government Code. (e) This section shall become operative on July 1, 1997.


128780. Notwithstanding any other provision of law, the disclosure aspects of this chapter shall be deemed complete with respect to district hospitals, and no district hospital shall be required to report or disclose any additional financial or utilization data to any person or other entity except as is required by this chapter.


128782. Notwithstanding any other provision of law, upon the request of a small and rural hospital, as defined in Section 124840, the office shall do all of the following: (a) If the hospital did not file financial reports with the office by electronic media as of January 1, 1993, the office shall, on a case-by-case basis, do one of the following: (1) Exempt the small and rural hospital from any electronic filing requirements of the office regarding annual or quarterly financial disclosure reports specified in Sections 128735 and 128740. (2) Provide a one-time reduction in the fee charged to the small and rural hospital not to exceed the maximum amount assessed pursuant to Section 127280 by an amount equal to the costs incurred by the small and rural hospital to purchase the computer hardware and software necessary to comply with any electronic filing requirements of the office regarding annual or quarterly financial disclosure reports specified in Sections 128735 and 128740. (b) The office shall provide a one-time reduction in the fee charged to the small and rural hospital not to exceed the maximum amount assessed pursuant to Section 127280 by an amount equal to the costs incurred by the small and rural hospital to purchase the computer software and hardware necessary to comply with any electronic filing requirements of the office regarding reports specified in Sections 128735, 128736, and 128737. (c) The office shall provide the hospital with assistance in meeting the requirements specified in paragraphs (1) and (2) of subdivision (c) of Section 128755 that the reports required by subdivision (g) of Section 128735 be filed by electronic media or by online transmission. The assistance shall include the provision to the hospital by the office of a computer program or computer software to create an electronic file of patient discharge abstract data records. The program or software shall incorporate validity checks and edit standards. (d) The office shall provide the hospital with assistance in meeting the requirements specified in subdivision (d) of Section 128755 that the reports required by subdivision (a) of Section 128736 be filed by online transmission. The assistance shall include the provision to the hospital by the office of a computer program or computer software to create an electronic file of emergency care data records. The program or software shall incorporate validity checks and edit standards. (e) The office shall provide the hospital with assistance in meeting the requirements specified in subdivision (e) of Section 128755 that the reports required by subdivision (a) of Section 128737 be filed by online transmission. The assistance shall include the provision to the hospital by the office of a computer program or computer software to create an electronic file of ambulatory surgery data records. The program or software shall incorporate validity checks and edit standards.


128785. On January 1, 1986, all regulations previously adopted by the California Health Facilities Commission that relate to functions vested in the office and that are in effect on that date, shall remain in effect and shall be fully enforceable to the extent that they are consistent with this chapter, as determined by the office, unless and until readopted, amended, or repealed by the office following review and comment by the commission.


128790. Pursuant to Section 16304.9 of the Government Code, the Controller shall transfer to the office the unexpended balance of funds as of January 1, 1986, in the California Health Facilities Commission Fund, available for use in connection with the performance of the functions of the California Health Facilities Commission to which it has succeeded pursuant to this chapter.


128795. All officers and employees of the California Health Facilities Commission who, on December 31, 1985, are serving the state civil service, other than as temporary employees, and engaged in the performance of a function vested in the office by this chapter shall be transferred to the office. The status, positions, and rights of persons shall not be affected by the transfer and shall be retained by them as officers and employees of the office, pursuant to the State Civil Service Act except as to positions exempted from civil service.

128800. The office shall have possession and control of all records, papers, offices, equipment, supplies, moneys, funds, appropriations, land, or other property, real or personal, held for the benefit or use of the California Health Facilities Commission for the performance of functions transferred to the office by this chapter.


128805. The office may enter into agreements and contracts with any person, department, agency, corporation, or legal entity as are necessary to carry out the functions vested in the office by this chapter or any other law.

128810. The office shall administer this chapter and shall make all regulations necessary to implement the provisions and achieve the purposes stated herein. The commission shall advise and consult with the office in carrying out the administration of this chapter.


Chapter 2. Annual Licensure Reports (reserved)

Chapter 3. Annual Clinic Reports (reserved)

Part 6. Facilities Loan Insurance And Financing

Chapter 1. Health Facility Construction Loan Insurance

Article 1. General Provisions

Ca Codes (hsc:129000-129045) Health And Safety Code Section 129000-129045



129000. This chapter may be cited as the "California Health Facility Construction Loan Insurance Law."


129005. The purpose of this chapter is to provide, without cost to the state, an insurance program for health facility construction, improvement, and expansion loans in order to stimulate the flow of private capital into health facilities construction, improvement, and expansion and in order to rationally meet the need for new, expanded and modernized public and nonprofit health facilities necessary to protect the health of all the people of this state. The provisions of this chapter are to be liberally construed to achieve this purpose.


129010. Unless the context otherwise requires, the definitions in this section govern the construction of this chapter and of Section 32127.2. (a) "Bondholder" means the legal owner of a bond or other evidence of indebtedness issued by a political subdivision or a nonprofit corporation. (b) "Borrower" means a political subdivision or nonprofit corporation that has secured or intends to secure a loan for the construction of a health facility. (c) "Construction, improvement, or expansion" or "construction, improvement, and expansion" includes construction of new buildings, expansion, modernization, renovation, remodeling and alteration of existing buildings, acquisition of existing buildings or health facilities, and initial or additional equipping of any of these buildings. In connection therewith, "construction, improvement, or expansion" or "construction, improvement, and expansion" includes the cost of construction or acquisition of all structures, including parking facilities, real or personal property, rights, rights-of-way, the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any land where the buildings or structures may be moved, the cost of all machinery and equipment, financing charges, interest (prior to, during and for a period after completion of the construction), provisions for working capital, reserves for principal and interest and for extensions, enlargements, additions, replacements, renovations and improvements, cost of engineering, financial and legal services, plans, specifications, studies, surveys, estimates of cost and of revenues, administrative expenses, expenses necessary or incident to determining the feasibility or practicability of constructing or incident to the construction; or the financing of the construction or acquisition. (d) "Commission" means the California Health Policy and Data Advisory Commission. (e) "Committee" means the Advisory Loan Insurance Committee. (f) "Debenture" means any form of written evidence of indebtedness issued by the State Treasurer pursuant to this chapter, as authorized by Section 4 of Article XVI of the California Constitution. (g) "Fund" means the Health Facility Construction Loan Insurance Fund. (h) "Health facility" means any facility providing or designed to provide services for the acute, convalescent, and chronically ill and impaired, including, but not limited to, public health centers, community mental health centers, facilities for the developmentally disabled, nonprofit community care facilities that provide care, habilitation, rehabilitation or treatment to developmentally disabled persons, facilities for the treatment of chemical dependency, including a community care facility, licensed pursuant to Chapter 3 (commencing with Section 1500) of Division 2, a clinic, as defined pursuant to Chapter 1 (commencing with Section 1200) of Division 2, an alcoholism recovery facility, defined pursuant to former Section 11834.11, and a structure located adjacent or attached to another type of health facility and that is used for storage of materials used in the treatment of chemical dependency, and general tuberculosis, mental, and other types of hospitals and related facilities, such as laboratories, outpatient departments, extended care, nurses' home and training facilities, offices and central service facilities operated in connection with hospitals, diagnostic or treatment centers, extended care facilities, nursing homes, and rehabilitation facilities. "Health facility" also means an adult day health center and a multilevel facility. Except for facilities for the developmentally disabled, facilities for the treatment of chemical dependency, or a multilevel facility, or as otherwise provided in this subdivision, "health facility" does not include any institution furnishing primarily domiciliary care. "Health facility" also means accredited nonprofit work activity programs as defined in subdivision (e) of Section 19352 and Section 19355 of the Welfare and Institutions Code, and nonprofit community care facilities as defined in Section 1502, excluding foster family homes, foster family agencies, adoption agencies, and residential care facilities for the elderly. Unless the context dictates otherwise, "health facility" includes a political subdivision of the state or nonprofit corporation that operates a facility included within the definition set forth in this subdivision. (i) "Office" means the Office of Statewide Health Planning and Development. (j) "Lender" means the provider of a loan and its successors and assigns. (k) "Loan" means money or credit advanced for the costs of construction or expansion of the health facility, and includes both initial loans and loans secured upon refinancing and may include both interim, or short-term loans, and long-term loans. A duly authorized bond or bond issue, or an installment sale agreement, may constitute a "loan." ( l) "Maturity date" means the date that the loan indebtedness would be extinguished if paid in accordance with periodic payments provided for by the terms of the loan. (m) "Mortgage" means a first mortgage on real estate. "Mortgage" includes a first deed of trust. (n) "Mortgagee" includes a lender whose loan is secured by a mortgage. "Mortgagee" includes a beneficiary of a deed of trust. (o) "Mortgagor" includes a borrower, a loan to whom is secured by a mortgage, and the trustor of a deed of trust. (p) "Nonprofit corporation" means any corporation formed under or subject to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code) that is organized for the purpose of owning and operating a health facility and that also meets the requirements of Section 501(c)(3) of the Internal Revenue Code. (q) "Political subdivision" means any city, county, joint powers entity, local hospital district, or the California Health Facilities Authority. (r) "Project property" means the real property where the health facility is, or is to be, constructed, improved, or expanded, and also means the health facility and the initial equipment in that health facility. (s) "Public health facility" means any health facility that is or will be constructed for and operated and maintained by any city, county, or local hospital district. (t) "Adult day health center" means a facility defined under subdivision (b) of Section 1570.7, that provides adult day health care, as defined under subdivision (a) of Section 1570.7. (u) "Multilevel facility" means an institutional arrangement where a residential facility for the elderly is operated as a part of, or in conjunction with, an intermediate care facility, a skilled nursing facility, or a general acute care hospital. "Elderly," for the purposes of this subdivision, means a person 60 years of age or older. (v) "State plan" means the plan described in Section 129020.


129015. The office shall administer this chapter and shall make all regulations necessary to implement the provisions and achieve the purposes stated herein. The commission, as authorized by this chapter and by Section 129460, shall advise and consult with the office in carrying out the administration of this chapter.


129020. The office shall implement the loan insurance program for the construction, improvement, and expansion of public and nonprofit corporation health facilities so that, in conjunction with all other existing facilities, the necessary physical facilities for furnishing adequate health facility services will be available to all the people of the state. Every odd-numbered year the office shall develop a state plan for use under this chapter. The plan shall include an overview of the changes in the health care industry, an overview of the financial status of the fund and the loan insurance program implemented by the office, a statement of the guiding principles of the loan insurance program, an evaluation of the program's success in meeting its mission as outlined in Section 129005, a discussion of administrative, procedural, or statutory changes that may be needed to improve management of program risks or to ensure the program effectively addresses the health needs of Californians, and the priority needs to be addressed by the loan insurance program. The health facility construction loan insurance program shall provide for health facility distribution throughout the state in a manner that will make all types of health facility services reasonably accessible to all persons in the state according to the state plan.

129022. Applications submitted to the office shall be signed under penalty of perjury by the applicant.


129030. The proceeds of all loans insured pursuant to this chapter shall be disbursed only upon order of the office or its designated agent. The office shall make regulations to insure the security of these proceeds.

129035. From time to time the office or its designated agent shall inspect each project for which loan insurance was approved, as needed, and if the inspection so warrants, the office or agent shall certify that the work has been performed upon the project, or purchases have been made, in accordance with the approved plans and specifications, and that payment of an installment of the loan proceeds is due to the borrower. The office shall charge the borrower a fee for these inspections and certifications, that in no instance shall exceed four dollars ($4) for each one thousand dollars ($1,000) of the borrower's loan that is insured. These fees shall be deposited in the fund.


129040. (a) The office shall establish a premium charge for the insurance of loans under this chapter, and this charge shall be deposited in the fund. A one-time nonrefundable premium charge shall be paid at the time the loan is insured. The premium rate may vary based upon the assessed level of relative financial risk determined pursuant to Section 129051, but shall in no event be greater than 3 percent. The amount of premium shall be computed on the basis of the application of the rate to the total amount of principal and interest payable over the term of the loan. (b) The office may annually charge a portion of the premium in advance commencing at the time of issuing or extending the commitment until the date the loan is insured or the commitment expires. The amount of the advance premium shall not exceed six dollars ($6) per year for each one thousand dollars ($1,000) of principal of the proposed loan. The total dollar amount of the premium advanced shall be nonrefundable and shall be credited against the amount of the premium charged pursuant to this section, or if the commitment expires and the loan is not insured, the advance shall be retained by the office to offset costs and expenses of the office related to preliminary work, underwriting the loan commitment, and monitoring construction.


129045. The office shall annually report to the Legislature the financial status of the program and its insured portfolio, including the status of all borrowers in each stage of default and the office's efforts to collect from borrowers that have defaulted on their debt service payments.


Article 1.5. Hospital Construction Assistance

Ca Codes (hsc:129048-129049) Health And Safety Code Section 129048-129049



129048. The Legislature finds and declares all of the following: (a) The State of California has a compelling interest in ensuring that adequate health facilities that are able to withstand seismic events are available to care for patients, especially in the event of a disaster. (b) Hospitals are required, under the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 (Chapter 1 (commencing with Section 129675) of Part 7), to improve, or remove from acute care service, buildings that pose a significant safety risk of collapse and danger to the public by January 1, 2008. (c) Hospitals are also required by that act to repair, rebuild, or remove from service, buildings that may not be repairable or functional following strong ground motion, by January 1, 2030. (d) California hospitals should be enabled to participate in programs that provide financial assistance for hospital construction and retrofitting. (e) The United States Department of Housing and Urban Development operates a HUD 242 loan insurance program, through which hospitals can access facility mortgage insurance and lower interest rates. (f) As a condition for participating in the HUD 242 program, a hospital must have a state-commissioned or conducted feasibility study of a hospital construction project.


129049. (a) The office may, at the request of a hospital, commission an independent study of market need and feasibility, as required by the United States Department of Housing and Urban Development, as part of an application for mortgage insurance for hospitals pursuant to Section 1715z-7 of Title 12 of the United States Code, or any other federal mortgage insurance program for health-related facilities. (b) The cost of the feasibility study permitted pursuant to subdivision (a) shall be paid for by the office from reimbursements received from the applicant. (c) Notwithstanding any other provision of law, the office may directly retain independent feasibility consultants and require a deposit from the applicant for the entire cost of the services at the time they are requested. (d) The office shall charge applicants a fee for the reasonable costs of administering this article. (e) The program provided for in this article shall be administered in conformance with the requirements of the United States Department of Housing and Urban Development for feasibility studies authorized by this section and the applicable requirements of state law pertaining to contracts.


Article 2. Insurable Loans And Applications Therefor

Ca Codes (hsc:129050-129110) Health And Safety Code Section 129050-129110



129050. A loan shall be eligible for insurance under this chapter if all of the following conditions are met: (a) The loan shall be secured by a first mortgage, first deed of trust, or other first priority lien on a fee interest of the borrower or by a leasehold interest of the borrower having a term of at least 20 years, including options to renew for that duration, longer than the term of the insured loan. The security for the loan shall be subject only to those conditions, covenants and restrictions, easements, taxes, and assessments of record approved by the office, and other liens securing debt insured under this chapter. The office may require additional agreements in security of the loan. (b) The borrower obtains an American Land Title Association title insurance policy with the office designated as beneficiary, with liability equal to the amount of the loan insured under this chapter, and with additional endorsements that the office may reasonably require. (c) The proceeds of the loan shall be used exclusively for the construction, improvement, or expansion of the health facility, as approved by the office under Section 129020. However, loans insured pursuant to this chapter may include loans to refinance another prior loan, whether or not state insured and without regard to the date of the prior loan, if the office determines that the amount refinanced does not exceed 90 percent of the original total construction costs and is otherwise eligible for insurance under this chapter. The office may not insure a loan for a health facility that the office determines is not needed pursuant to subdivision (k). (d) The loan shall have a maturity date not exceeding 30 years from the date of the beginning of amortization of the loan, except as authorized by subdivision (e), or 75 percent of the office's estimate of the economic life of the health facility, whichever is the lesser. (e) The loan shall contain complete amortization provisions requiring periodic payments by the borrower not in excess of its reasonable ability to pay as determined by the office. The office shall permit a reasonable period of time during which the first payment to amortization may be waived on agreement by the lender and borrower. The office may, however, waive the amortization requirements of this subdivision and of subdivision (g) of this section when a term loan would be in the borrower's best interest. (f) The loan shall bear interest on the amount of the principal obligation outstanding at any time at a rate, as negotiated by the borrower and lender, as the office finds necessary to meet the loan money market. As used in this chapter, "interest" does not include premium charges for insurance and service charges if any. Where a loan is evidenced by a bond issue of a political subdivision, the interest thereon may be at any rate the bonds may legally bear. (g) The loan shall provide for the application of the borrower's periodic payments to amortization of the principal of the loan. (h) The loan shall contain those terms and provisions with respect to insurance, repairs, alterations, payment of taxes and assessments, foreclosure proceedings, anticipation of maturity, additional and secondary liens, and other matters the office may in its discretion prescribe. (i) The loan shall have a principal obligation not in excess of an amount equal to 90 percent of the total construction cost. (j) The borrower shall offer reasonable assurance that the services of the health facility will be made available to all persons residing or employed in the area served by the facility. (k) The office has determined that the facility is needed by the community to provide the specified services. In making this determination, the office shall do all of the following: (1) Require the applicant to describe the community needs the facility will meet and provide data and information to substantiate the stated needs. (2) Require the applicant, if appropriate, to demonstrate participation in the community needs assessment required by Section 127350. (3) Survey appropriate local officials and organizations to measure perceived needs and verify the applicant's needs assessment. (4) Use any additional available data relating to existing facilities in the community and their capacity. (5) Contact other state and federal departments that provide funding for the programs proposed by the applicant to obtain those departments' perspectives regarding the need for the facility. Additionally, the office shall evaluate the potential effect of proposed health care reimbursement changes on the facility's financial feasibility. (6) Consider the facility's consistency with the Cal-Mortgage state plan. (l) In the case of acquisitions, a project loan shall be guaranteed only for transactions not in excess of the fair market value of the acquisition. Fair market value shall be determined, for purposes of this subdivision, pursuant to the following procedure, that shall be utilized during the office's review of a loan guarantee application: (1) Completion of a property appraisal by an appraisal firm qualified to make appraisals, as determined by the office, before closing a loan on the project. (2) Evaluation of the appraisal in conjunction with the book value of the acquisition by the office. When acquisitions involve additional construction, the office shall evaluate the proposed construction to determine that the costs are reasonable for the type of construction proposed. In those cases where this procedure reveals that the cost of acquisition exceeds the current value of a facility, including improvements, then the acquisition cost shall be deemed in excess of fair market value. (m) Notwithstanding subdivision (i), any loan in the amount of ten million dollars ($10,000,000) or less may be insured up to 95 percent of the total construction cost. In determining financial feasibility of projects of counties pursuant to this section, the office shall take into consideration any assistance for the project to be provided under Section 14085.5 of the Welfare and Institutions Code or from other sources. It is the intent of the Legislature that the office endeavor to assist counties in whatever ways are possible to arrange loans that will meet the requirements for insurance prescribed by this section. (n) The project's level of financial risk meets the criteria in Section 129051.


129051. (a) The office shall develop and implement a system for assessing the relative financial risk of the applicant. The system shall include, but is not limited to, an assessment of the applicant' s financial strength, credit history, security for the loan, cash-flow, and ability to repay the debt. (b) The office shall establish a maximum acceptable level of financial risk for the projects it insures. The office may only approve a project if its risk level is below the established maximum, except as provided in subdivision (c). (c) The office may approve a project with a level of insurance risk that exceeds the established maximum if the office determines that the project meets a significant community need or will be a sole community provider.


129052. A pledge by or to the office of, or the grant to the office of a security interest in, revenues, moneys, accounts, accounts receivable, contract rights, general intangibles, documents, instruments, chattel paper, and other rights to payment of whatever kind made by or to the office pursuant to the authority granted in this chapter shall be valid and binding from the time the pledge is made for the benefit of pledgees and successors thereto. The revenues, moneys, accounts, accounts receivable, contract rights, general intangibles, documents, instruments, chattel paper, and other rights to payment of whatever kind pledged by or to the office or its assignees shall immediately be subject to the lien of the pledge without physical delivery or further act. The lien of such pledge shall be valid and binding against all parties, irrespective of whether the parties have notice of the lien. The indenture, trust agreement, resolution, or another instrument by which such pledge is created need not be recorded or the security interest otherwise perfected.


129055. In order to comply with subdivision (j) of Section 129050, any borrower that is certified for reimbursement for cost of care under Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of the Welfare and Institutions Code shall demonstrate that its facility is used by persons for whom the cost of care is reimbursed under that chapter, in a proportion that is reasonable based upon the proportion of Medi-Cal patients in the community served by the borrower and by persons for whom the costs of care is reimbursed under Title XVIII of the federal Social Security Act in a proportion that is reasonable based upon the proportion of Medicare patients in the community served by the borrower. For the purposes of this chapter, the community means the service areas or patient populations for which the health facility provides health care services, unless the office determines that, or the borrower demonstrates to the satisfaction of the office that, a different definition is more appropriate for the borrower's facility.


129060. Subdivisions (b) and (c) of Section 129355 shall apply to any residential or nonresidential alcoholism or drug abuse recovery or treatment program or facility, as certified under Section 11831.5, or licensed under former Section 11834.19; and any facility that provides an organized program of therapeutic, social, and health activities and services to persons with functional impairments, as licensed under Section 1576.


129065. As part of its assurance under subdivision (j) of Section 129050, any borrower that is a general acute care hospital or acute psychiatric hospital shall agree to the following actions: (a) To advise each person seeking services at the borrower's facility as to the person's potential eligibility for Medi-Cal and Medicare benefits or benefits from other governmental third party payers. (b) To make available to the office and to any interested person a list of physicians with staff privileges at the borrower's facility, that includes: (1) Name. (2) Speciality. (3) Language spoken. (4) Whether takes Medi-Cal and Medicare patients. (5) Business address and phone number. (c) To inform in writing on a periodic basis all practitioners of the healing arts having staff privileges in the borrower's facility as to the existence of the facility's community service obligation. The required notice to practitioners shall contain a statement, as follows: "This hospital has agreed to provide a community service and to accept Medi-Cal and Medicare patients. The administration and enforcement of this agreement is the responsibility of the Office of Statewide Health Planning and Development and this facility." (d) To post notices in the following form, that shall be multilingual where the borrower serves a multilingual community, in appropriate areas within the facility, including but not limited to, admissions offices, emergency rooms, and business offices: NOTICE OF COMMUNITY SERVICE OBLIGATION "This facility has agreed to make its services available to all persons residing or employed in this area. This facility is prohibited by law from discriminating against Medi-Cal and Medicare patients. Should you believe you may be eligible for Medi-Cal or Medicare, you should contact our business office (or designated person or office) for assistance in applying. You should also contact our business office (or designated person or office) if you are in need of a physician to provide you with services at this facility. If you believe that you have been refused services at this facility in violation of the community service obligation you should inform (designated person or office) and the Office of Statewide Health Planning and Development." The borrower shall provide copies of this notice for posting to all welfare offices in the county where the borrower's facility is located.

129070. In the event the borrower cannot demonstrate that it meets the requirement of Section 129055, it may nonetheless be eligible for a loan under this chapter if it presents a plan that is satisfactory to the office, that details the reasonable steps and timetables that the borrower agrees to take to bring the facility into compliance with Section 129055.


129075. (a) Each borrower shall provide any reports as may be required of it by Part 5 (commencing with Section 128675), from which the office shall determine the borrower's compliance with subdivision (j) of Section 129050. (b) If a report indicates noncompliance with subdivision (j) of Section 129050, Section 129055, or Section 129065, the office shall require the borrower to submit a plan detailing the steps and timetables the borrower will take to bring the facility into compliance. (c) The office shall annually report to the Legislature the extent of the borrowers' compliance with their community service obligations pursuant to subdivision (j) of Section 129050, Section 129055, and Section 129065.

129080. The office may impose additional appropriate remedies and sanctions against a borrower when any of the following occurs: (a) The office determines that the annual compliance report required in Section 129075 indicates that the borrower is out of compliance with subdivision (j) of Section 129050. (b) A facility fails to carry out the actions agreed to in a plan approved by the office pursuant to Section 129070. (c) The facility fails to submit compliance reports as required by Section 129075. The additional remedies include referring the violation to the office of Attorney General of California for legal action authorized under existing law or other remedy at law or equity. However, the remedies obtainable by legal action shall not include withdrawal or cancellation of the loan insurance provided under this chapter.

129085. (a) If a borrower is unable to comply with subdivision (j) of Section 129050 due to selective provider contracting under the Medi-Cal program, and the office has determined the borrower has negotiated in good faith but was not awarded a contract, the borrower may be eligible for insurance under this chapter as provided in subdivision (b). (b) The office may determine that a noncontracting borrower shall be considered as meeting the requirements of subdivision (j) of Section 129050 if the borrower otherwise provides a community service in accordance with regulations adopted by the office. The regulations shall describe alternative methods of meeting the obligation, that may include, but not be limited to, providing free care, charity care, trauma care, community education, or primary care outreach and care to the elderly, in amounts greater than the community average. The regulations shall include a requirement that a general acute care hospital, that is not a small and rural hospital as defined in Section 124840, shall have, and continue to maintain, a 24-hour basic emergency medical service with a physician on duty, if it provided this service on January 1, 1990. The office shall have the authority to waive this requirement upon a determination by the director that this requirement would create a hardship for the hospital, be inconsistent with regionalization of emergency medical services, or not be in the best interest of the population served by the hospital.

129087. The office shall develop and maintain a formal system of monitoring borrowers, in order to assist the office in detecting at the earliest possible date those borrowers who are experiencing financial difficulties. This system shall include, but shall not be limited to, all of the following: (a) A method of tracking the receipt of information that borrowers are required by law and regulatory agreement to submit to the office. (b) A process for thoroughly reviewing borrowers' financial statements, budgets, auditor's management letters, and health facility utilization trends. (c) Timely and structured site visits to insured facilities.


129090. Pursuant to this chapter, political subdivisions and nonprofit corporations may apply for state insurance of needed construction, improvement, or expansion loans for construction, remodeling, or acquisition of health facilities to be or already owned, established, and operated by them as provided in this chapter. Applications shall be submitted to the office by the nonprofit corporation or political subdivision authorized to construct and operate a health facility. Each application shall conform to the requirements of the office, shall be submitted in the manner and form prescribed by the office, and shall be accompanied by an application fee of one-half of 1 percent of the amount of the loan applied for, but in no case shall the application fee exceed five hundred dollars ($500). The fees shall be deposited by the office in the fund and used to defray the office's expenditures in the administration of this chapter.

129092. Notwithstanding any other provision of law, upon the application of a borrower for insurance, the office shall perform a feasibility study relating to the proposed project, the cost of which shall be paid by the applicant. The office may retain independent consultants and require a deposit from the applicant for such services, upon submission of the application. This section shall take effect on January 1, 2001.


129095. (a) The office shall not regulate, impose requirements on, or require approval by the office of a professional, or a fee charged by a professional, used by applicants for the initial application for loan insurance. The choice of any professional and the funding source used shall be left entirely to the participants. (b) For purposes of this section, "professional" includes, but is not limited to, an underwriter, bond counsel, or consultant. (c) Nothing in this section shall prohibit the office, in the event of defaults, from taking any action authorized under this chapter to protect the financial interest of the state.


129100. Every applicant for insurance shall be afforded an opportunity for a fair hearing before the commission upon 10 days' written notice to the applicant. If the office, after affording reasonable opportunity for development and presentation of the application and after receiving the advice of the commission, finds that an application complies with the requirements of this article and of Section 129020 and is otherwise in conformity with the state plan, it may approve the application for insurance. The office shall consider and approve applications in the order of relative need set forth in the state plan in accordance with Section 129020. Judicial review of a final decision made under this section may be had by filing a petition for writ of mandate. Any petition shall be filed within 30 days after the date of the final decision of the office.


129105. The office may upon application of the borrower insure any loan that is eligible for insurance under this chapter, and upon the terms prescribed by the office, may make commitments for the insuring of the loans prior to their date of execution or disbursement thereon. The decision to grant loan insurance upon an application of the borrower is within the discretion of the director of the office. Showing need for the project or meeting the eligibility requirements for loan insurance and establishing financial feasibility of the project or recommendation for approval from the committee does not create any entitlement to loan insurance.


129110. Any contract of insurance executed by the office under this chapter shall be conclusive evidence of the eligibility of the loan for insurance and the validity of any contract of insurance so executed shall be incontestable from the date of the execution of the contract, except in case of fraud or misrepresentation on the part of the lender.


Article 3. Defaults

Ca Codes (hsc:129125-129174.1) Health And Safety Code Section 129125-129174.1



129125. In any case when the lender under a loan to a nonprofit corporation insured under this chapter shall have foreclosed and taken possession of the property under a mortgage in accordance with regulations of, and within a period to be determined by the office, or shall, with the consent of the office, have otherwise acquired the property from the borrower after default, the lender shall be entitled to receive the benefit of the insurance as provided in this section, upon (a) the prompt conveyance to the office of title to the property that meets the requirements of the regulations of the office in force at the time the loan was insured, and that is evidenced in the manner prescribed by the regulations, and (b) the assignment to the office of all claims of the lender against the borrower or others arising out of the loan transaction or foreclosure proceedings except claims that may have been released with the consent of the office. Upon the conveyance and assignment, the office shall notify the Treasurer, who shall issue to the lender debentures having a total face value equal to the outstanding value of the loan. For the purposes of this section, the outstanding value of the loan shall be determined, in accordance with the regulations prescribed by the office, by (a) adding to the amounts of the original principal obligation of the loan and interest that are accrued and unpaid the amount of all payments that have been made by the lender for the following: taxes and assessments, ground rents, water rates, and other liens that are prior to the mortgage; charges for the administration, operation, maintenance and repair of the health facility property; insurance on the project property, loan insurance premiums, and any tax imposed by a city or county upon any deed or other instrument by which the property was acquired by the lender and transferred or conveyed to the office; and the costs of foreclosure or of acquiring the property by other means actually paid by the lender and approved by the office; and by (b) deducting from the total amount any amounts received by the lender after the borrower's default on account of the loans or as rent or other income from the property.

129130. In any case when a political subdivision defaults on the payment of interest or principal accrued and due on bonds or other evidences of indebtedness insured under this chapter, debentures in an amount equal to the outstanding original principal obligation and interest on the bonds that were accrued and unpaid on the date of default and bearing interest at a rate equal to and payment schedule identical with those of the bonds shall be issued by the Treasurer upon notification thereof by the office to the bondholders upon the surrender of the bonds to the office. In any case in which a hospital district defaults on the payment of interest or principal accrued and due on an insured loan secured by a first mortgage, first deed of trust, or other security agreement as authorized by Section 32127.2, debentures in an amount equal to the outstanding original principal obligation and interest on the bonds that were accrued and unpaid on the date of default and bearing interest at a rate equal to and payment schedule identical with those of the bonds shall be issued by the Treasurer upon notification thereof by the office to the bondholders upon surrender of the bonds to the office after the state has enforced its rights under the first mortgage, first deed of trust, or other security agreement.


129135. Notwithstanding any requirement contained in this chapter relating to acquisition of title and possession of the project property by the lender and its subsequent conveyance and transfer to the office, and for the purpose of avoiding unnecessary conveyance expense in connection with payment of insurance benefits under the provisions of this chapter, the office may, subject to regulations that it may prescribe, permit the lender to tender to the office a satisfactory conveyance of title and transfer of possession direct from the borrower or other appropriate grantor and to pay to the lender the insurance benefits to which it would otherwise be entitled if the conveyance had been made to the lender and from the lender to the office.


129140. Upon receiving notice of the default of any loan insured under this chapter, the office, in its discretion and for the purpose of avoiding foreclosure under Section 129125 and notwithstanding the fact that it has previously approved a request of the lender for extensions of the time for curing the default and of the time for commencing foreclosure proceedings or for otherwise acquiring title to the project property, or has approved a modification of the loan for the purpose of changing the amortization provisions by recasting the unpaid balance, may acquire the loan and security agreements securing the loans upon the issuance to the lender of debentures in an amount equal to the unpaid principal balance of the loan plus any accrued unpaid loan interest plus reimbursement for the costs and attorney's fees of the lender enumerated in Section 129125. After the acquisition of the loan and security interests therefor by the office, the lender shall have no further rights, liabilities, or obligations with respect thereto. The provisions of Section 129125 relating to the issuance of debentures incident to the acquisition of foreclosed properties shall apply with respect to debentures issued under this section, and the provisions of this chapter relating to the rights, liabilities, and obligations of a lender shall apply with respect to the office when it has acquired an insured loan under this section, in accordance with and subject to any regulations prescribed by the office modifying the provisions to the extent necessary to render their application for these purposes appropriate and effective.


129145. Notwithstanding any other provision of this chapter, after the office determines that the lender and borrower have exhausted all reasonable means of curing any default, the office within its discretion may, when it is in the best interests of the state, the borrower, and the lender, cure the default of the borrower by making payment from the fund directly to the lender of any amounts of the original principal obligation and interest of the loan that are accrued and unpaid. The payment shall be secured by an assignment to the office of a pro rata share of the security agreements made to the lender and, upon the payment, the borrower shall become liable for repayment of the amount thereof to the office over a period and at a rate of interest as shall be determined by the office.


129150. The office may at any time, under the terms and conditions that it may prescribe, consent to the lender's release of the borrower from its liability under the loan or the security agreement securing the loan, or consent to the release of parts of the project property from the lien of any security agreement.


129152. If a borrower fails to submit a required report, or upon any other default of any regulatory or contractual term or covenant, whether or not a default has been declared, the office first shall informally communicate with the borrower. If the borrower fails to submit the required report or otherwise cure the default, the office shall issue a formal demand in writing stating the nature of the default and requiring the borrower to submit a detailed plan of correction that is acceptable to the office. If the borrower fails to either submit a plan, or timely cure the default, the office shall perform an onsite visit. If the office determines the borrower is not making sufficient progress in submitting any required reports or otherwise curing any default, the office may require the borrower, at the borrower's expense, to employ an independent consultant or professional, acceptable to the office, to conduct a program audit. If the borrower fails to adopt the recommendations of the independent consultant or professional made in the program audit, or if the borrower fails to otherwise timely cure the default, the office shall have all the remedies set forth in the Section 129173.


129155. Debentures issued under this chapter shall be in the form and denomination, subject to the terms and conditions, and include provisions for redemption, if any, as may be prescribed by the office with the approval of the Treasurer, and may be in coupon or registered form.


129160. (a) All debentures issued under this chapter to any lender or bondholder shall be executed in the name of the fund as obligor, shall be signed by the State Treasurer, and shall be negotiable. Pursuant to Sections 129125 and 129130, all debentures shall be dated as of the date of the institution of foreclosure proceedings or as of the date of the acquisition of the property after default by other than foreclosure, or as of another date as the office, in its discretion, may establish. The debentures shall bear interest from that date at a rate approved by the State Treasurer, equal to either the rate applicable to the most recent issue of State General Fund bonds or that specified in Section 129130, which shall be payable on the dates as the office, in its discretion, may establish except in the case of bonds or other evidences of indebtedness as specified in Section 129130, and shall have the same maturity date as the loan which they insured. All debentures shall be exempt, both as to principal and interest, from all taxation now or hereafter imposed by the state or local taxing agencies, shall be paid out of the fund, which shall be primarily liable therefor, and shall be, pursuant to Section 4 of Article XVI of the California Constitution, fully and unconditionally guaranteed as to principal and interest by the State of California, which guaranty shall be expressed on the face of the debentures. In the event that the fund fails to pay upon demand, when due, the principal of or interest on any debentures issued under this chapter, the State Treasurer shall pay to the holders the amount thereof which is authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, and thereupon to the extent of the amount so paid the State Treasurer shall succeed to all the rights of the holders of the debentures. The fund shall be liable for repayment to the Treasury of any money paid therefrom pursuant to this section in accordance with procedures jointly established by the State Treasurer and the office. (b) In the event of a default, any debenture issued under this article shall be paid on a par with general obligation bonds issued by the state.

129165. Notwithstanding any other provision of law relating to the acquisition, management or disposal of real property by the state, the office shall have power to deal with, operate, complete, lease, rent, renovate, modernize, insure, or sell for cash or credit, in its discretion, any properties conveyed to it in exchange for debentures as provided in this chapter; and notwithstanding any other provision of law, the office shall also have power to pursue to final collection by way of compromise or otherwise all claims against borrowers assigned by lenders to the office as provided in this chapter. All income from the operation, rental, or lease of the property and all proceeds from the sale thereof shall be deposited in the fund and all costs incurred by the office in its exercise of powers granted in this section shall be met by the fund. The power to convey and to execute in the name of the office deeds of conveyance, deeds of release, assignments and satisfactions of loans and mortgages, and any other written instrument relating to real or personal property or any interest therein acquired by the office pursuant to the provisions of this chapter may be exercised by the office or by any officer of the office appointed by it.


129170. No lender or borrower shall have any right or interest in any property conveyed to the office or in any claim assigned to it, nor shall the office owe any duty to any lender or borrower with respect to the management or disposal of this property.


129172. Notwithstanding any other provision of law, if, prior to foreclosing on any collateral provided by a borrower, the office institutes a judicial proceeding or takes any action against a borrower to enforce compliance with the obligations set out in the regulatory agreement, the contract of insurance, or any other contractual loan closing document or law, including, but not limited to, Section 129173, that remedy or action shall not constitute an action within the meaning of subdivision (a) of Section 726 of the Code of Civil Procedure, or in any way constitute a violation of the intent or purposes of Section 726 of the Code of Civil Procedure, or constitute a money judgment or a deficiency judgment within the meaning of Sections 580a, 580b, 580d, or subdivision (b) of Section 726 of the Code of Civil Procedure. However, these provisions of the Code of Civil Procedure shall apply to any judicial proceeding instituted, or nonjudicial foreclosure action taken by the office to collect the principal and interest due on the loan with the borrower.


129173. (a) In fulfilling the purposes of this article, as set forth in Section 129005, and upon making a determination that the financial status of a borrower may jeopardize a borrower's ability to fulfill its obligations under any insured loan transaction so as to threaten the economic interest of the office in the borrower or to jeopardize the borrower's ability to continue to provide needed health care services in its community, including, but not limited to, a declaration of default under any contract related to the transaction, the borrower missing any payment to its lender, or the borrower's accounts payable exceeding three months, the office may assume or direct managerial or financial control of the borrower in any or all of the following ways: (1) The office may supervise and prescribe the activities of the borrower in the manner and under the terms and conditions as the office may stipulate in any contract with the borrower. (2) Notwithstanding the provisions of the articles of incorporation or other documents of organization of a nonprofit corporation borrower, this control may be exercised through the removal and appointment by the office of members of the governing body of the borrower sufficient so that the new members constitute a voting majority of the governing body. (3) In the event the borrower is a nonprofit corporation or a political subdivision, the office may request the Secretary of the California Health and Human Services Agency to appoint a trustee. The trustee shall have full and complete authority of the borrower over the insured project, including all property on which the office holds a security interest. No trustee shall be appointed unless approved by the office. A trustee appointed by the secretary pursuant to this subdivision may exercise all the powers of the officers and directors of the borrower, including the filing of a petition for bankruptcy. No action at law or in equity may be maintained by any party against the office or a trustee by reason of their exercising the powers of the officers and directors of a borrower pursuant to the direction of, or with the approval of, the secretary. (4) The office may institute any action or proceeding, or the office may request the Attorney General to institute any action or proceeding against any borrower, to obtain injunctive or other equitable relief, including the appointment of a receiver for the borrower or the borrower's assets, in the superior court in and for the county in which the assets or a substantial portion of the assets are located. The proceeding under this section for injunctive relief shall conform with the requirements of Chapter 3 (commencing with Section 525) of Title 7 of Part 2 of the Code of Civil Procedure, except that the office shall not be required to allege facts necessary to show lack of adequate remedy at law, or to show irreparable loss or damage. Injunctive relief may compel the borrower, its officers, agents, or employees to perform each and every provision contained in any regulatory agreement, contract of insurance, or any other loan closing document to which the borrower is a party, or any obligation imposed on the borrower by law, and require the carrying out of any and all covenants and agreements and the fulfillment of all duties imposed on the borrower by law or those documents. A receiver may be appointed pursuant to Chapter 5 (commencing with Section 564) of Title 7 of Part 2 of the Code of Civil Procedure. In cooperation with the Attorney General, the office shall develop and maintain a list of receivers who have demonstrated experience both in the health care field and as a receiver. Upon a proper showing, the court shall grant the relief provided by law and requested by the office or the Attorney General. No receiver shall be appointed unless approved by the office. The office shall establish reporting requirements for receivers to ensure that the office is fully apprised of all costs incurred and progress made by the receiver. A receiver appointed by the superior court pursuant to this subdivision and Section 564 of the Code of Civil Procedure may, with the approval of the court, exercise all of the powers of the officers and directors of the borrower, including the filing of a petition for bankruptcy. No action at law or in equity may be maintained by any party against the office, the Attorney General, or a receiver by reason of their exercising the powers of the officers and directors of a borrower pursuant to the order of, or with the approval of, the superior court. (5) The borrower shall inform the office in advance of all meetings of its governing body. The borrower shall not exclude the office from attending any meeting of the borrower's governing body. (b) Other than the loan insured under this chapter, the office shall not be liable for any debt of a borrower, or to a borrower, as a result of the office asserting its legal remedies against a borrower insured under this chapter. (c) It is the intent of the Legislature that this section is remedial in nature, and is applicable retroactively to any health facility construction loans in existence at the time of its enactment, to the extent that the application of this section does not unlawfully impair existing contract rights.


129174. (a) In the event a borrower has defaulted in making its payments on the loan insured by the office to the lender or the borrower's bond trustee, at any time thereafter, the office may do any of the following: (1) Decease a portion or all of the bonds or may purchase a portion or all of the bonds at a private or public sale or on the open market. For this purpose, the office may use any funds available, including, but not limited to, funds in the Health Facility Construction Loan Insurance Fund, funds that the office may receive either from settlement or recoveries from lawsuits, funds from the sale of assets of the borrower, or funds held by the borrower's bond trustee. If requested by the office, the Treasurer shall purchase the bonds on behalf of the office. Upon the purchase of any bonds under this section, the office shall direct the borrower' s bond trustee to cancel the bonds purchased. (2) Issue bonds used for the sole purpose of refunding any part or all of the defaulted bonds, provided that, in the opinion of the office, there are adequate present value savings to refund all or part of the defaulted bonds. If requested by the office, the Treasurer shall act as the issuer for this purpose. (3) Require the lender or borrower's bond trustee to accelerate the borrower's debt and the maturity dates of the bonds, if any. If the bond trustee accelerates the bond debt and maturity dates, the office shall pay from the fund to the lender or borrower's bond trustee the full amount of the remaining principal of the loan, any interest accrued and unpaid on this amount, and any costs enumerated in Section 129125. (b) For the purposes of this section, "bonds" mean bonds, certificate of participation, notes, or other evidence of indebtedness of a loan insured by the office.


129174.1. In the event an obligor on a loan insured by the office is the subject of an order for relief in bankruptcy and that a plan has been proposed for confirmation, upon a certification by the office that the insurance is in place and would be in place if the plan were confirmed, then the office shall have the right to vote whether to accept or reject the plan on behalf of the holders of the loan insured by the office.


Article 4. Termination Of Insurance

Ca Codes (hsc:129175-129185) Health And Safety Code Section 129175-129185



129175. Should a borrower be more than 10 days delinquent in paying the premium charges or inspection fees for insurance under this chapter, the office shall notify the borrower in writing. If that payment remains delinquent more than 30 days after the sending of the office's notice to the borrower, the office shall make every reasonable effort to notify the lender in writing. If that delinquency continues, on the 31st day after sending of the office's notice to the lender, the insurance shall be terminated and become null and void.

129180. The obligation to pay any subsequent premium charge for insurance shall cease, and all rights of the lender and the borrower under this chapter shall terminate as of the date of the notice, as herein provided, in the event that (a) any lender under a loan forecloses on the mortgaged property, or has otherwise acquired the project property from the borrower after default, but does not convey the property to the office in accordance with this chapter, and the office is given written notice thereof, or (b) the borrower pays the obligation under the loan in full prior to the maturity thereof, and the office is given written notice thereof.


129185. The office is authorized to terminate any insurance contract upon joint request by the borrower and the lender and upon payment of a termination charge that the office determines to be equitable, taking into consideration the necessity of protecting the fund. Upon the termination, borrowers and lenders shall be entitled to the rights, if any, that they would be entitled to under this chapter if the insurance contract were terminated by payment in full of the insured loan.


Article 5. Health Facility Construction Loan Insurance Fund

Ca Codes (hsc:129200-129215) Health And Safety Code Section 129200-129215



129200. There is hereby established a Health Facility Construction Loan Insurance Fund, that shall be used by the office as a revolving fund for carrying out the provisions and administrative costs of this chapter. Notwithstanding Section 13340 of the Government Code, the money in the fund is hereby continuously appropriated to the office without regard to fiscal years for the purposes of this chapter.


129205. Moneys in the fund not needed for the current operations of the office under this chapter shall be invested pursuant to law. The office may, with the approval of the State Treasurer, purchase the debentures issued under this chapter. Debentures so purchased shall be canceled and not reissued.

129210. (a) The office's authorization to insure health facility construction, improvement, and expansion loans under this chapter shall be limited to a total of not more than three billion dollars ($3,000,000,000). (b) Notwithstanding the limitation in subdivision (a), the office may exceed the specific dollar limitation in either of the following instances: (1) Refinancing a preexisting loan, if the refinancing results in savings to the health facility and increases the probability that a loan can be repaid. (2) The need for financing results from earthquakes or other natural disasters.


129215. The Health Facility Construction Loan Insurance Fund, established pursuant to Section 129200, shall be a trust fund and neither the fund nor the interest or other earnings generated by the fund shall be used for any purpose other than those purposes authorized by this chapter.


Article 5.5. Advisory Loan Insurance Committee

Ca Codes (hsc:129220-129221) Health And Safety Code Section 129220-129221



129220. The office shall establish an Advisory Loan Insurance Committee which shall be comprised of nine members, eight of whom shall be appointed by the director of the office. Of the nine members, seven shall be appointed from outside state government and two shall be appointed from inside state government. The Director of Finance shall appoint one of the members chosen from inside state government. The members of the committee shall be qualified in the field of financial analysis, management, operations, or construction, improvement, or expansion of health facilities. Those members appointed from outside state government shall be reimbursed one hundred dollars ($100) for each day spent in the performance of official duties. All members shall be reimbursed for reasonable and necessary expenses.


129221. The duties of the committee shall include, but not be limited to, the following: (a) The committee shall assist the director of the office in formulating policy concerning financial analysis, management, operation, or construction, improvement, or expansion of health facilities, and shall, at the request of the director of the office, provide overall policy advice, guidance, and recommendations. The committee shall also provide the office with advice and comment on the state plan prepared pursuant to Section 129020. (b) The committee shall also review and analyze the feasibility, level of financial risk, and community benefit assessments made by the office on applications submitted for approval. The committee shall recommend to the director whether an application should be approved and whether any conditions should be attached to that approval. Loans that are currently insured by the office and subsequently are refinanced to obtain a lower interest rate or emergency working capital loans insured pursuant to Section 129091 shall not require the review of the committee.


Article 6. Community Mental Health Facilities Loan Insurance

Ca Codes (hsc:129225-129260) Health And Safety Code Section 129225-129260



129225. This article shall be known as, and may be cited as, the Community Mental Health Facilities Loan Insurance Law.


129230. It is the intent of the Legislature in enacting this article to encourage the development of facilities for community-based programs that assist mental health clients living in any institutional setting, including state and local inpatient hospitals, skilled nursing homes, intermediate care facilities, and community care facilities to move to more independent living arrangements. It is further the intent of the Legislature to encourage local programs to seek funding for facility development from private sources and with the assistance provided pursuant to this chapter. To achieve this purpose in determining eligibility for loan insurance pursuant to this chapter, the following special provisions apply to facilities approved in the county Short-Doyle plan and meeting the intentions of this article: (a) Facilities shall not require approval pursuant to Section 129295 by the statewide system of health facility planning, the area health planning agency, or the Health Advisory Council, for the issuance of loan insurance, unless specifically required for the facilities by the facility category of licensure. (b) Notwithstanding subdivision (i) of Section 129050, any loan of under three hundred thousand dollars ($300,000) for a nonprofit corporation as well as a political subdivision may be fully insured equal to the total construction cost, except a loan to any proprietary corporation that is insured pursuant to subdivision (d) of this section. (c) The State Department of Mental Health or the local mental health program may provide all application fees, inspection fees, premiums and other administrative payments required by this chapter, except with respect to any loan to a proprietary corporation that is insured pursuant to subdivision (d) of this section. (d) The borrower may be a proprietary corporation, provided that the facility is leased to the local mental health program for the duration of the insurance agreement. In these instances, all provisions in this chapter and this article that apply to a nonprofit corporation shall apply to the proprietary corporation, except as provided in subdivisions (b) and (c) of this section. (e) For the purposes of this article, subdivision (c) of Section 129010 shall include the purchase of existing buildings. (f) Facilities shall not require approval pursuant to Section 129020 by the statewide system of health facility planning, the area health planning agency, or the Health Advisory Council, for the issuance of loan insurance, until the director of the office and the Director of the Department of Mental Health determine that the state plan developed pursuant to Section 129020 adequately and comprehensively addresses the need for community mental health facilities and that finding is reported to the appropriate policy committees of the Legislature.

129235. Loans of under three hundred thousand dollars ($300,000) for any single facility shall have priority for obtaining loan insurance under the special provisions established pursuant to Section 129230.

129240. The total amount of loans that may be insured pursuant to this article shall not exceed fifteen million dollars ($15,000,000).


129245. No loan insurance shall be provided pursuant to this article for the purpose of providing psychiatric inpatient services in an acute psychiatric hospital or a general acute care hospital.


129250. The Legislative Analyst shall review and comment on the utilization and effectiveness of this article in the annual budget analysis and in hearings.

129255. If, in construing Article 6 (commencing with Section 129225) of this chapter as applied to the other provisions of this chapter, any conflict arises, this article shall prevail over the other provisions of this chapter.

129260. If any provision of this article or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of this article that can be given effect without the invalid provision or application, and to this end the provisions of this act are severable.


Article 7. Small Facility Loan Guarantee For Developmental Disability Programs

Ca Codes (hsc:129275-129295) Health And Safety Code Section 129275-129295



129275. This article shall be known, and may be cited, as the Small Facility Loan Guarantee for Programs Serving People with Developmental Disabilities.

129280. The State of California has a compelling interest in the development of facilities for community-based programs that assist persons with a developmental disability living in an institutional setting to transition to more independent living arrangements. In order to meet this significant community need, it is further the intent of the Legislature to encourage programs to seek funding for facility development from private sources and with the assistance provided pursuant to this chapter. To achieve this purpose in determining eligibility for loan insurance pursuant to this chapter, the following special provisions apply to facilities developed pursuant to Section 4688.5 of the Welfare and Institutions Code and meeting the intentions of this article: (a) For purposes of this article, the following definitions shall apply: (1) "Borrower" shall mean a political subdivision or nonprofit corporation approved by the regional center as an ownership entity that owns the project property. (2) "Long-term residency lease agreement" shall mean a lease by the borrower, as lessor, of facilities developed pursuant to Section 4688.5 of the Welfare and Institutions Code to a service provider selected by a regional center, as lessee, having a term of at least as long as the term of the insured loan. (3) "Nonprofit corporation" shall mean a corporation formed under or subject to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code) or a limited liability company (LLC) whose sole member is a corporation formed under or subject to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code) that meets applicable sections of the federal Internal Revenue Code governing nonprofit status. (4) "Regional center" shall mean a private nonprofit corporation that contracts with the state and is organized pursuant to Chapter 5 (commencing with Section 4620) of Division 4.5 of the Welfare and Institutions Code. (5) "Service provider" shall mean an entity with the appropriate license, if required, that contracts with a regional center to provide services to persons eligible for regional center services. (b) Notwithstanding subdivisions (i), (l), and (m) of Section 129050, any loan made pursuant to this article for a nonprofit corporation or a political subdivision may be fully insured equal to the total cost of construction, improvement, and expansion, which may exceed the current value of the health facility, including improvements, when supported by other security for, or guaranty of, the debt. (c) The Golden Gate Regional Center, Regional Center of the East Bay, and San Andreas Regional Center shall provide for, secure, and ensure the full payment of a lease or leases developed pursuant to Section 4688.5 of the Welfare and Institutions Code.


129285. (a) Loans of under three hundred thousand dollars ($300,000) for any single facility for six or fewer developmentally disabled shall have priority for obtaining loan insurance. (b) The total amount of loans that may be insured pursuant to this article shall not exceed one hundred million dollars ($100,000,000).


129290. If any provision of this article or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of this article that can be given effect without the invalid provision or application, and to this end the provisions of this article are severable.


129295. The office may insure, pursuant to this article, loans to nonprofit borrowers that are not licensed to operate the facilities for which the loans are insured, provided that the borrower has entered into a long-term residency lease agreement with a service provider selected by the applicable regional center to operate that facility. The number of facilities for which loans are insured under this section shall not exceed 100 and the aggregate amount of loans insured under this section shall not exceed one hundred million dollars ($100,000,000).


Article 9. Rural Hospital Grant Program

Ca Codes (hsc:129325-129335) Health And Safety Code Section 129325-129335



129325. It is the intent of the Legislature in enacting this article to assist rural hospitals that play a vital role in the health delivery system. The Legislature recognizes the difficulties rural hospitals encounter meeting urban hospital standards while serving a small, rural, or tourist patient base. However, it is not the intent of the Legislature to provide assistance to facilities that can only survive with continuous subsidies. Rather, it is the intent of the Legislature, through this program, to encourage the development and transition to an alternative rural hospital model, and to provide essential access to services not available at the alternative rural hospital level.


129330. In each even-numbered year, the office shall contract for an actuarial study to determine the reserve sufficiency of funds in the Health Facility Construction Loan Insurance Fund. The study shall examine the portfolio of existing insured loans and shall estimate the amount of reserve funds that the office should reasonably have available to be able to respond adequately to potential foreseeable risks, including extraordinary administrative expenses and actual defaults. Actuarial study contracts shall be exempt from Section 10373 of the Public Contract Code and shall be considered sole-source contracts.

129335. (a) In each odd-numbered year when the reserve balance in the fund is projected to be in excess of that actuarially needed, the office may, subject to authority in the Budget Act, grant excess reserve funds to rural hospitals. (b) Whenever the office administers the grant program, it shall do so by a competitive process where potential grantees have sufficient time to apply. Priority for funds shall be given to alternative rural hospitals and rural hospitals that are sole community providers. Priority shall also be given to applicants that are otherwise financially viable, but request one-time financial assistance for equipment expenditures or other capital outlays. The maximum amount of any grant for a single project in any one grant year shall be two hundred fifty thousand dollars ($250,000). (c) For the purposes of this article, "rural hospital" shall have the same meaning as contained in subdivision (a) of Section 124840.


Article 10. Community Health Center Facilities Loan Insurance

Ca Codes (hsc:129350-129355) Health And Safety Code Section 129350-129355



129350. This article shall be known and may be cited as the Community Health Center Facilities Loan Insurance Law.


129355. (a) "Community health center facilities," as used in this article, means those licensed, nonprofit primary care clinics as defined in paragraph (1) of subdivision (a) of Section 1204. (b) Notwithstanding subdivision (i) of Section 129050, any loan in the amount of five million dollars ($5,000,000) or less for a community health center facility pursuant to this chapter may be insured up to 95 percent of the total construction cost. (c) Community health center facilities applying for any loan insurance pursuant to this chapter, may use existing equity in buildings, equipment, and donated assets, including, but not limited to, land and receipts from expenses related to the capital outlay for the project, notwithstanding the date of occurrence to meet the equity requirements of this chapter. In determining the value of the equity in any donated property, the office may use the original purchase price or the current appraised value. (d) Any state plan referred to in Section 129020 developed by the office shall include a chapter identifying any impediments that preclude small facilities from utilizing the California Health Facility Construction Loan Insurance Program. The state plan shall also include specific programmatic remedies to enable small projects to utilize the program if impediments are found.


Chapter 2. Hospital Survey And Construction (hill Burton Program)

Article 1. Definitions And General Provisions

Ca Codes (hsc:129375-129435) Health And Safety Code Section 129375-129435



129375. This chapter may be cited as the "California Hospital Survey and Construction Act."


129380. As used in this chapter, the terms defined in this article have the meanings set forth in this article.


129385. "The federal act" includes Public Law 725 of the 79th Congress, approved August 13, 1946, entitled the Hospital Survey and Construction Act, as amended by Public Law 482 of the 83d Congress, approved July 12, 1954, entitled the Medical Facilities Survey and Construction Act of 1954, Public Law 88-164 of the 88th Congress, approved October 31, 1963, entitled Mental Retardation Facilities and Community Mental Health Centers Construction Act of 1963, and any other law now enacted by Congress concerning hospitals as defined in this article.

129390. "The Surgeon General" means the Surgeon General of the Public Health Service of the United States, or the Secretary of the Department of Health, Education and Welfare of the United States.


129395. "Hospital" includes hospitals for the chronically ill and impaired, public health centers, community mental health centers, facilities for the mentally retarded, and general, tuberculosis, mental and other types of hospitals and related facilities, such as laboratories, outpatient departments, nurses' home and training facilities, and central service facilities operated in connection with hospitals, diagnostic or treatment centers, nursing homes, and rehabilitation facilities, but except for facilities for the mentally retarded does not include any institution furnishing primarily domiciliary care.

129400. "Public health center" means a publicly owned facility for the provision of public health services, including related facilities such as laboratories, clinics, provisions for bed care, and administrative offices operated in connection with public health centers.


129405. "Nonprofit hospital," "nonprofit diagnostic or treatment center," "nonprofit rehabilitation facility," and "nonprofit nursing home" mean any hospital, diagnostic or treatment center, rehabilitation facility, and nursing home, as the case may be, that is owned and operated by one or more nonprofit corporations or associations no part of the net earnings of that inures, or may lawfully inure, to the benefit of any private shareholder or individual, or a hospital publicly owned or operated by a public entity or agency of this state.

129410. "Construction" includes construction of new buildings, expansion, remodeling, and alteration of existing buildings, and initial equipment of any buildings; including architects' fees, but excluding the cost of off-site improvements and, except with respect to public health centers, the cost of the acquisition of land.


129415. This chapter shall not apply to any sanatorium or institution conducted by or for the adherents of any well recognized church or religious denomination for the purpose of providing facilities for the care or treatment of the sick who depend upon prayer or spiritual means for healing in the practice of the religion of the church or denomination.


129420. "Diagnostic or treatment center" means a facility for the diagnosis or diagnosis and treatment of ambulatory patients (1) that is operated in connection with a hospital, or (2) where patient care is under the professional supervision of persons licensed to practice medicine or surgery in the State, or, in the case of dental diagnosis or treatment, under the professional supervision of persons licensed to practice dentistry in the state.


129425. "Hospital for the chronically ill and impaired" shall not include any hospital primarily for the care and treatment of mentally ill or tuberculous patients.


129430. "Rehabilitation facility" means a facility that is operated for the primary purpose of assisting in the rehabilitation of disabled persons through an integrated program of medical, psychological, social, and vocational evaluation and services under competent professional supervision, and in the case of which (1) the major portion of the evaluation and services is furnished within the facility; and (2) either (a) the facility is operated in connection with a hospital, or (b) all medical and related health services are prescribed by, or are under the general direction of, persons licensed to practice medicine or surgery in the state.


129435. "Nursing home" means a facility for the accommodation of convalescents or other persons who are not acutely ill and not in need of hospital care, but who require skilled nursing care and related medical services (1) that is operated in connection with a hospital, or (2) where nursing care and medical services are prescribed by, or are performed under the general direction of, persons licensed to practice medicine or surgery in the state.


Article 2. Administration

Ca Codes (hsc:129450-129460) Health And Safety Code Section 129450-129460



129450. The office shall constitute the sole agency of the state for the following purposes: (a) Making an inventory of existing hospitals, surveying the need for construction of hospitals, and developing a program of hospital construction as provided in Article 3 (commencing with Section 129475) of this chapter. (b) Developing and administering a state plan for the construction of public and other nonprofit hospitals as provided in Article 3 (commencing with Section 129475) of this chapter.


129455. In carrying out the purposes of this chapter, the department shall: (a) Require reports, make inspections and investigations, and prescribe regulations as the department deems necessary. (b) Provide methods of administration, appoint personnel, and take other action as may be necessary to comply with the requirements of the federal act, this chapter, and the regulations thereunder. (c) Make an annual report to the Governor and to the Legislature on activities and expenditures pursuant to this chapter, including recommendations for additional legislation as the director considers appropriate to furnish adequate hospital, clinic, and similar facilities to the people of this state.


129460. The California Health Policy and Data Advisory Commission shall advise and consult with the department in carrying out the administration of this chapter and succeeds to and is vested with the functions, authority and responsibility of the Advisory Hospital Council and the Health Planning Council. Any reference in any code to the Advisory Hospital Council or to the Health Planning Council shall be deemed a reference to the California Health Policy and Data Advisory Commission.


Article 3. Survey And Planning

Ca Codes (hsc:129475-129535) Health And Safety Code Section 129475-129535



129475. The department shall make an inventory of existing hospitals, including public, nonprofit, and proprietary hospitals, to survey the need for construction of hospitals, and, on the basis of the inventory and survey, shall develop a program for the construction of public and other nonprofit hospitals as will, in conjunction with existing facilities, afford the necessary physical facilities for furnishing adequate hospital, clinic, and similar services to all the people of the state.


129480. The construction program shall provide, in accordance with regulations prescribed under the federal act, this chapter, and the regulations thereunder, for adequate hospital facilities for the people residing in this state, and as much as possible shall provide for their distribution throughout the state in a manner that makes all types of hospital service reasonably accessible to all persons in the state.


129485. The office may make application to the Surgeon General for federal funds to assist in carrying out the survey and planning activities provided for in this article. These funds shall be deposited in the Office of Statewide Health Planning and Development Fund in the State Treasury.


129490. The department shall prepare and submit to the Surgeon General a state plan, and any revisions thereof or supplements thereto, that shall include the hospital construction program developed under this article, and that shall provide for the establishment, administration, and operation of hospital construction activities in accordance with the requirements of the federal act and regulations thereunder.


129495. The department shall, by regulation, prescribe minimum requirements for the maintenance and operation of hospitals that receive federal aid for construction under the state plan and shall adopt and submit building standards for approval pursuant to Chapter 4 (commencing with Section 18935) of Part 2.5 of Division 13 as required for those purposes.


129500. The state plan shall set forth the relative need for the several projects included in the construction program, determined on the basis of the relative need of different sections of the population and of different areas lacking adequate hospital facilities, giving special consideration to areas with relatively small financial resources, and in accordance with the regulations of the Surgeon General prescribed pursuant to the federal act, and shall provide for their construction in the order of relative need so determined, insofar as financial resources available therefor and for maintenance and operations make it possible. In enacting this section it is the intent of the Legislature to encourage the design of projects and the development of programs that undertake responsibility to provide in an efficient manner comprehensive health care, including outpatient and preventive care, as well as hospitalization, to a defined population or populations. For purposes of this section, the criterion of efficiency referred to herein shall include, but not be limited to, a consideration of the utilization of health facilities and services, including policies, mechanisms, and procedures to prevent excessive utilization.


129505. Applications for hospital construction projects for which federal funds are requested shall be submitted to the department, and may be submitted by the state or any political subdivision thereof or by any public or nonprofit agency authorized to construct and operate a hospital. Each application for a construction project shall conform to federal and state requirements, and shall be submitted in the manner and form prescribed by the department. Any county that applies for or accepts federal funds for any hospital does so on condition that the hospital for which assistance is requested and accepted, at all times during which it is operated, (a) shall be qualified for a license under Chapter 2 (commencing with Section 1250) of Division 2 (whether or not that chapter is otherwise applicable to the hospital), and be subject to inspection under that chapter to the same extent as are other hospitals to which that chapter applies; and (b) shall not restrict patients to those unable to pay for their care.

129510. The department shall afford to every applicant for assistance for a construction project an opportunity for a fair hearing before the council upon 10 days' written notice to the applicant. If the department, after affording reasonable opportunity for development and presentation of applications in the order of relative need, finds that a project application complies with the requirements of Section 129505 and is otherwise in conformity with the state plan, it shall approve the application and shall recommend and forward it to the Surgeon General. The department shall consider and forward applications in the order of relative need set forth in the state plan in accordance with Section 129500.


129515. From time to time the department shall inspect each construction project approved by the Surgeon General, and if the inspection so warrants, the department shall certify to the Surgeon General that work has been performed upon the project, or purchases have been made, in accordance with the approved plans and specifications, and that payment of an installment of federal funds is due to the applicant.


129520. The office is hereby authorized to receive federal funds in behalf of, and transmit them to, the applicants. Money received from the federal government for a construction project approved by the Surgeon General shall be deposited in the Office of Statewide Health Planning and Development Fund, and shall be used solely for payments due applicants for work performed, or purchases made, in carrying out approved projects.


129525. Any moneys deposited in the Office of Statewide Health Planning and Development Fund in accordance with this article are appropriated for expenditure by the office director for the purposes for which moneys were received, in accordance with the provisions of this chapter. Any funds received and not expended for the purposes of this article shall be repaid to the Treasury of the United States.


129530. The Legislature finds that in certain areas there is a need for nursing and convalescent homes for persons who are indigent. It is the purpose of this section to provide authorization for the construction of the homes, so that public medical assistance may be provided, under the state's medical assistance programs, for indigent persons. The office may issue a certificate of need upon application by a chartered nonprofit corporation, for a nursing and convalescent home that provides or makes available medical care for indigent persons, to be constructed under the Mortgage Insurance Program of the Federal Housing Administration.


129535. The department shall, to the extent required by federal law, ascertain and enforce compliance with federal and state provisions and regulations adopted pursuant to this section during the period that an applicant who receives federal assistance remains obligated in order to assure the provision of uncompensated services for persons unable to pay for those services. The department shall adopt regulations, in accordance with applicable federal regulations and Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, for administering federal requirements for uncompensated services for persons unable to pay for those services. The regulations shall include all of the following: (a) Identify categories of persons eligible for uncompensated services. (b) Define the services that applicants may provide to meet their obligations under this section. (c) Require obligated facilities to submit information, data, budgets, and reports, in a form and manner as the department may prescribe, describing the method under which the facility elects to establish the level at which it will provide uncompensated services. (d) Permit department approval of requests to provide uncompensated services at a lesser level than prescribed, based on facility's inability to provide the prescribed level. (e) Specify procedures for public hearings to inform the public of levels of uncompensated services to be provided by individual facilities or to resolve disputes and complaints relating to these levels. (f) Set forth procedures for publication of notice concerning public hearings and, thereafter, for notices announcing the levels of uncompensated services to be provided by facilities. (g) Describe the surveillance program utilized by the department to assure that individual facility's obligations to provide a determined level of uncompensated services are met.


Article 4. State Assistance For Hospital Construction

Ca Codes (hsc:129550-129590) Health And Safety Code Section 129550-129590



129550. As used in this article, "public agency" means cities, counties, and local hospital districts.


129555. "Public agency" also means any corporation, no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual, who is authorized to construct and operate a hospital.

129560. The office shall administer this article, and shall make regulations as may be necessary to carry out its provisions.


129565. From any state moneys made available to it for that purpose, the department shall provide assistance pursuant to this article for the construction of hospitals to public agencies that apply therefor, if the public agencies are eligible for assistance under this article and apply for and accept assistance upon the conditions specified in this article.


129570. A public agency is eligible for state assistance under this article only if it qualifies for and receives assistance from the United States Government under the federal act.


129575. Any public agency that applies for or accepts state assistance for any hospital under this article does so on condition that the hospital for which such assistance is requested and accepted, at all times during which it is operated, (a) shall be qualified for a license under Chapter 2 (commencing with Section 1400) of Division 2 of this code (whether or not Chapter 2 is otherwise applicable to the hospital), and be subject to inspection under Chapter 2 to the same extent as are other hospitals to which Chapter 2 applies; or shall be qualified for a license under Part 2 (commencing with Section 5699) of Division 5 of the Welfare and Institutions Code (whether or not Division 5 is otherwise applicable to the hospital), and be subject to inspection under Division 5 to the same extent as are other hospitals to which Division 5 applies; and (b) shall not restrict patients to those unable to pay for their care.

129580. The amount of state assistance that shall be provided to any public agency for any hospital under this article shall be a sum equal to the assistance received by the agency for its project under the federal act, but in no event shall the amount of the state assistance exceed one-third of the cost of construction of the project.


129585. Application for state assistance under this article shall be made to the office, in the manner and form prescribed by the office. The office shall prescribe the time and manner of payment of state assistance, if granted.

129590. Funds utilized for community mental health center purposes shall be allocated in a manner consistent with the intent of Section 9000 of the Welfare and Institutions Code and priority shall be given to the establishment or enlargement of clinical service facilities in general hospitals that are a part of a project proposal that provides a comprehensive service.


Chapter 3. Fire Safety Loan Program (reserved)

Part 7. Facilities Design Review And Construction

Chapter 1. Health Facilities

Article 1. General Provisions

Ca Codes (hsc:129675-129680) Health And Safety Code Section 129675-129680



129675. This chapter shall be known and may be cited as the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983.


129680. (a) It is the intent of the Legislature that hospital buildings that house patients who have less than the capacity of normally healthy persons to protect themselves, and that must be reasonably capable of providing services to the public after a disaster, shall be designed and constructed to resist, insofar as practical, the forces generated by earthquakes, gravity, and winds. In order to accomplish this purpose, the office shall propose proper building standards for earthquake resistance based upon current knowledge, and provide an independent review of the design and construction of hospital buildings. (b) Local jurisdictions are preempted from the enforcement of all building standards published in the California Building Standards Code relating to the regulation of hospital buildings and the enforcement of other regulations adopted pursuant to this chapter, and all other applicable state laws, including plan checking and inspection of the design and details of the architectural, structural, mechanical, plumbing, electrical, and fire and panic safety systems, and the observation of construction. The office shall assume these responsibilities. (c) Where local jurisdictions have more restrictive requirements for the enforcement of building standards, other building regulations, and construction supervision, these requirements shall be enforced by the office. (d) Each local jurisdiction shall keep the office advised as to the existence of any more restrictive local requirements. Where a reasonable doubt exists as to whether the requirements of the local jurisdiction are more restrictive, the effect of these requirements shall be determined by the Hospital Building Safety Board. It is further the intent of the Legislature that the office, with the advice of the Hospital Building Safety Board, may conduct or enter into contracts for research regarding the reduction or elimination of seismic or other safety hazards in hospital buildings or research regarding hospital building standards.


Article 2. Definitions

Ca Codes (hsc:129700-129745) Health And Safety Code Section 129700-129745



129700. Unless the context otherwise requires, the definitions in this article govern the construction of this chapter.


129705. "Architect" means a person who is certified and holds a valid license under Chapter 3 (commencing with Section 5500) of Division 3 of the Business and Professions Code.


129710. "Construction or alteration" includes any construction, reconstruction, or alteration of, or addition to, any hospital building.

129715. "Director" means the Director of the Office of Statewide Health Planning and Development.


129720. "Engineering geologist" means a person who is validly certified under Chapter 12.5 (commencing with Section 7800) of Division 3 of the Business and Professions Code.


129725. (a) (1) "Hospital building" includes any building not specified in subdivision (b) that is used, or designed to be used, for a health facility of a type required to be licensed pursuant to Chapter 2 (commencing with Section 1250) of Division 2. (2) Except as provided in paragraph (7) of subdivision (b), hospital building includes a correctional treatment center, as defined in subdivision (j) of Section 1250, the construction of which was completed on or after March 7, 1973. (b) "Hospital building" does not include any of the following: (1) Any building where outpatient clinical services of a health facility licensed pursuant to Section 1250 are provided that is separated from a building in which hospital services are provided. If any one or more outpatient clinical services in the building provides services to inpatients, the building shall not be included as a "hospital building" if those services provided to inpatients represent no more than 25 percent of the total outpatient services provided at the building. Hospitals shall maintain on an ongoing basis, data on the patients receiving services in these buildings, including the number of patients seen, categorized by their inpatient or outpatient status. Hospitals shall submit this data annually to the State Department of Health Services. (2) Any building used, or designed to be used, for a skilled nursing facility or intermediate care facility if the building is of single-story, wood-frame or light steel frame construction. (3) Any building of single-story, wood-frame or light steel frame construction where only skilled nursing or intermediate care services are provided if the building is separated from a building housing other patients of the health facility receiving higher levels of care. (4) Any freestanding structures of a chemical dependency recovery hospital exempted under subdivision (c) of Section 1275.2. (5) Any building licensed to be used as an intermediate care facility/developmentally disabled habilitative with six beds or less and any intermediate care facility/developmentally disabled habilitative of 7 to 15 beds that is a single-story, wood-frame or light steel frame building. (6) Any building subject to licensure as a correctional treatment center, as defined in subdivision (j) of Section 1250, the construction of which was completed prior to March 7, 1973. (7) (A) Any building that meets the definition of a correctional treatment center, pursuant to subdivision (j) of Section 1250, for which the final design documents were completed or the construction of which was begun prior to January 1, 1994, operated by or to be operated by the Department of Corrections, the Department of the Youth Authority, or by a law enforcement agency of a city, county, or a city and county. (B) In the case of reconstruction, alteration, or addition to, the facilities identified in this paragraph, and paragraph (6) or any other building subject to licensure as a general acute care hospital, acute psychiatric hospital, correctional treatment center, or nursing facility, as defined in subdivisions (a), (b), (j), and (k) of Section 1250, operated or to be operated by the Department of Corrections, the Department of the Youth Authority, or by a law enforcement agency of a city, county, or city and county, only the reconstruction, alteration, or addition, itself, and not the building as a whole, nor any other aspect thereof, shall be required to comply with this chapter or the regulations adopted pursuant thereto.


129730. (a) Space for the following functions shall be considered "outpatient clinical services," when provided in a freestanding building that is separated from a hospital building where inpatient hospital services are provided: administrative space; central sterile supply; storage; morgue and autopsy facilities; employee dressing rooms and lockers; janitorial and housekeeping facilities; and laundry. (b) The outpatient portions of the following services may also be delivered in a freestanding building and shall be considered "outpatient clinical services:" surgical; chronic dialysis; psychiatry; rehabilitation; occupational therapy; physical therapy; maternity; dentistry; and chemical dependency. (c) Services that duplicate basic services, as defined in subdivision (a) of Section 1250, or services that are provided as part of a basic service, but are not required for facility licensure may also be provided in a freestanding building. (d) The office shall not approve any plans that propose to locate any function listed in subdivision (a) in a freestanding building until the State Department of Health Services certifies to the office that it has received and approved a plan acceptable to the State Department of Health Services that demonstrates how the health facility will continue to provide all basic services in the event of any emergency when the freestanding building may no longer remain functional. (e) Services listed in subdivisions (b) and (c) are subject to the same 25-percent inpatient limitation described in Section 129725.


129735. "Light steel frame construction" means building construction using bearing walls composed of light gauge steel studs for its primary vertical support systems.


129740. "Office" means the Office of Statewide Health Planning and Development.


129745. "Structural engineer" means a person who is validly certified to use the title structural engineer under Chapter 7 (commencing with Section 6700) of Division 3 of the Business and Professions Code.


Article 3. General Requirements And Administration

Ca Codes (hsc:129750-129856) Health And Safety Code Section 129750-129856



129750. The office shall observe the construction of, or addition to, any hospital building or the reconstruction or alteration of any hospital building, as it deems necessary to comply with this chapter for the protection of life and property.


129760. The governing board of each hospital or other hospital governing authority, before adopting any plans for the hospital building, shall submit the plans to the office for approval and shall pay the fees prescribed in this chapter.

129761. The office shall use, to the extent possible, information technology to facilitate the timely performance of its duties and responsibilities under this chapter.


129765. (a) Except as set forth in subdivision (b), the application for approval of the plans shall be accompanied by the plans, including full, complete, and accurate specifications, and structural design computations, which shall comply with the requirements prescribed by the office. The office may permit electronic submission, review, and approval of plans. (b) Notwithstanding subdivision (a), the office, in its sole discretion, may enter into a written agreement with the hospital governing authority for the phased submittal and approval of plans. The office shall charge a fee for the review and approval of plans submitted pursuant to this subdivision. This fee shall be based on the estimated cost, but shall not exceed the actual cost, of the entire phased review and approval process for those plans. This fee shall be deducted from the application fee pursuant to Section 129785.


129770. (a) The office shall pass upon and approve or reject all plans for the construction or the alteration of any hospital building, independently reviewing the design to assure compliance with the requirements of this chapter. The office shall review the structural systems and related details, including the independent review of the geological data. Geological data shall be reviewed by an engineering geologist, and structural design data shall be reviewed by a structural engineer. (b) Whenever the office finds a violation of this chapter that requires correction, a citation of the violation shall be issued to the hospital governing board or authority in writing and shall include a proper reference to the regulation or statute being violated.


129775. (a) Except as otherwise provided in subdivision (b), plans submitted pursuant to this chapter for work that affects structural elements shall contain an assessment of the nature of the site and potential for earthquake damage, based upon geologic and engineering investigations and reports by competent personnel of the causes of earthquake damage. One-story Type V wood frame or light steel frame, or light steel and wood frame construction of 4,000 square feet or less, shall be exempt from the provisions of this section, unless the project is within a special study zone established pursuant to Section 2622 of the Public Resources Code. (b) The requirements of subdivision (a) may be waived by the office when the office determines that these requirements for the proposed hospital project are unnecessary and would not be beneficial to the safety of the public. The office, after consultation with the Building Safety Board, shall adopt regulations defining the criteria upon which the determination of a waiver shall be made.


129780. The engineering investigation shall be correlated with the geologic evaluation made pursuant to Section 129775.


129785. (a) (1) The office shall determine an application filing fee that will cover the costs of administering this chapter. For a hospital facility, as defined in subdivision (a), (b), or (f) of Section 1250, the fee shall not exceed 2 percent of a project's estimated construction cost. For a skilled nursing or intermediate care facility, as defined in subdivision (c), (d), (e), or (g) of Section 1250, the fee shall not exceed 1.5 percent of a project's estimated construction cost. Application filing fees shall be established in accordance with applicable procedures established in Article 5 (commencing with Section 11346) of Chapter 3.5 of Part 1 of Division 3 of Title 2 of the Government Code. (2) Notwithstanding paragraph (1), the minimum application filing fee in any case shall be two hundred fifty dollars ($250). (b) The office shall issue an annual permit upon submission of an application, pursuant to Section 129765, for one or more projects of a hospital facility, as defined in subdivision (a), (b), or (f) of Section 1250, if the total estimated construction cost is fifty thousand dollars ($50,000) or less per fiscal year. The fee for the annual permit shall be five hundred dollars ($500) and shall be in lieu of an application filing fee. The annual permit shall cover all projects undertaken for a particular hospital facility up to a total estimated construction cost of fifty thousand dollars ($50,000) during the state fiscal year in which the annual permit is issued. If a hospital facility chooses not to apply for an annual permit to cover a project or projects costing fifty thousand dollars ($50,000) or less in total, the hospital facility may instead submit the project or projects for review and approval as otherwise specified in this chapter, including paying the application filing fee determined under subdivision (a). (c) The office shall issue an annual permit upon submission of an application, pursuant to Section 129765, for one or more projects of a skilled nursing or intermediate care facility, as defined in subdivision (c), (d), (e), or (g) of Section 1250, if the total estimated construction cost is twenty-five thousand dollars ($25,000) or less per fiscal year. The fee for the annual permit shall be two hundred fifty dollars ($250) and shall be in lieu of an application filing fee. The annual permit shall cover all projects undertaken for a particular skilled nursing or intermediate care facility up to a total estimated construction cost of twenty-five thousand dollars ($25,000) during the state fiscal year in which the annual permit is issued. If a skilled nursing or intermediate care facility chooses not to apply for an annual permit to cover a project or projects costing twenty-five thousand dollars ($25,000) or less in total, the skilled nursing or intermediate care facility may instead submit the project or projects for review and approval as otherwise specified in this chapter, including paying the application filing fee determined under subdivision (a). (d) If the actual construction cost exceeds the estimated construction cost by more than 5 percent, a further fee shall be paid to the office, based on the above schedule and computed on the amount that the actual cost exceeds the amount of the estimated cost. If the estimated construction cost exceeds the actual construction cost by more than 5 percent, the office shall refund the excess portion of any paid fees, based on the above schedule and computed on the amount that the estimated cost exceeds the amount of the actual cost. A refund is not required if the applicant did not complete construction or alteration of 75 percent of the square footage included in the project, as contained in the approved drawings and specifications for the project. In addition, the office shall adopt regulations specifying other circumstances when the office shall refund to an applicant all or part of any paid fees for projects submitted under this chapter. The regulations shall include, but not be limited to, refunds of paid fees for a project that is determined by the office to be exempt or otherwise not reviewable under this chapter, and for a project that is withdrawn by the applicant prior to the commencement of review by the office of the drawing and specifications submitted for the project. All refunds pursuant to this section shall be paid from the Hospital Building Account in the Architecture Public Building Fund, as established pursuant to Section 129795.


129787. (a) The payment of the filing fee described in Section 129785 may be postponed by the office if all of the following conditions are met: (1) The proposed construction or alteration has been proposed as a result of any event that has been declared to be a disaster by the Governor. (2) The office determines that the applicant cannot presently afford to pay the filing fee. (3) The applicant has applied for federal disaster relief from the Federal Emergency Management Agency (FEMA) with respect to the disaster described in paragraph (1). (4) The applicant is expected to receive disaster assistance within one year from the date of the application. (b) If the office does not receive full payment of any fee for which payment has been postponed pursuant to subdivision (a) within one year from the date of plan approval, the statewide office may request an offset from the Controller for the unpaid amount against any amount owed by the state to the applicant, and may request additional offsets against amounts owed by the state to the applicant until the fee is paid in full. This subdivision shall not be construed to establish an offset as described in the preceding sentence as the exclusive remedy for the collection of any unpaid fee amount as described in that same sentence.


129790. The office shall propose specific space, architectural, structural, mechanical, plumbing, and electrical standards for correctional treatment centers in cooperation with the Board of Corrections, the Department of Corrections, and the Department of the Youth Authority.


129795. All fees shall be paid into the State Treasury and credited to the Hospital Building Fund, that is hereby created and continuously appropriated without regard to fiscal years for the use of the office, subject to approval of the Department of Finance, in carrying out this chapter. Adjustments in the amounts of the fees, as determined by the office and approved by the Department of Finance, shall be made within the limits set in Section 129785 in order to maintain a reasonable working balance in the account. Notwithstanding any other provision of law, any moneys collected pursuant to this chapter contained in the hospital building fund established by the Department of Finance, that are in the fund on January 1, 1994, shall be available for expenditure in accordance with this section.


129800. The director shall request the Department of Finance or the Auditor General to perform an audit of the uses of fees collected pursuant to Section 129785. This audit shall include, but not be limited to, an accounting of staff resources allocated to hospital plan reviews by the office and by the Office of the State Architect in the Department of General Services since these reviews are funded by fees collected pursuant to Section 129785. If the Department of Finance and the Auditor General indicate that other audit responsibilities will prohibit them from performing and completing the audit within six months of being initially requested to do so, then the office may contract with an independent organization to perform the audit.


129805. (a) All plans and specifications shall be prepared under the responsible charge of an architect or a structural engineer, or both. A structural engineer shall prepare the structural design and shall sign plans and specifications related thereto. Administration of the work of construction shall be under the responsible charge of the architect and structural engineer, except that where plans and specifications for alterations or repairs do not affect architectural or structural conditions, the plans and specifications may be prepared under the responsible charge of, and work of construction may be administered by, a professional engineer duly qualified to perform the services and holding a valid certificate under Chapter 7 (commencing with Section 6700) of Division 3 of the Business and Professions Code for performance of services in that branch of engineering in which the plans, specifications, and estimates and work of construction are applicable. (b) The office may exempt projects from the requirements of subdivision (a) where the plans and specifications are not ordinarily, in the standard practice of architecture and engineering, prepared by licensed architects or registered engineers, or both, and are not a component of a project prepared under the responsible charge of a licensed architect or registered engineer, or both. To implement this authority, the office shall adopt regulations, consistent with this section, that specify which projects may be exempted from the requirements of subdivision (a).


129810. Before commencing any construction or alteration of any hospital building, the written approval of the necessary plans as to safety of design and construction, by the office, shall be obtained.


129812. Notwithstanding any other provision of law, the office may utilize an over-the-counter plan review process.


129815. Any permit or authorization issued or provided pursuant to this chapter shall be subject to Chapter 3 (commencing with Section 15374) of Part 6.7 of Division 3 of Title 2 of the Government Code.


129820. No contract for the construction or alteration of any hospital building, made or executed on or after January 1, 1983, by the governing board or authority of any hospital or other similar public board, body, or officer otherwise vested with authority to make or execute the contract, is valid, and no money shall be paid for any work done under the contract or for any labor or materials furnished in constructing or altering the hospital building, unless all of the following requirements are satisfied: (a) The plans and specifications comply with this chapter and the requirements contained in the California Building Standards Code. (b) The written approval thereof has first been obtained from the office. (c) The hospital building is to be accessible to, and usable by, persons with disabilities. (d) The plans and specifications comply with the fire and panic safety requirements of the California Building Standards Code.


129825. (a) The hospital governing board or authority shall provide for and require competent and adequate inspection during construction or alteration by an inspector satisfactory to the architect or structural engineer, or both, and the office. Except as otherwise provided in subdivision (b), the inspector shall act under the direction of the architect or structural engineer, or both, and be responsible to the board or authority. Nothing in this section shall be construed to prohibit any licensed architect, structural engineer, mechanical engineer, electrical engineer, or any facility maintenance personnel, if approved by the office, from performing the duties of an inspector. (b) If alterations or repairs are to be conducted under the supervision of a professional engineer pursuant to Section 129805, the inspector need only be satisfactory to the office and to the professional engineer, and the inspector shall act under the direction of the professional engineer. (c) The office shall make an inspection of the hospital buildings and of the work of construction or alteration as in its judgment is necessary or proper for the enforcement of this chapter and the protection of the safety of the public. Whenever the office finds a violation of this chapter that requires correction, the citation of the violation shall be issued to the hospital governing board or authority in writing and shall include a proper reference to the regulation or statute being violated. (d) The office shall approve inspectors that shall be limited to the following: (1) "A" inspectors, who may inspect all areas of construction specialty, including, but not limited to, structural. (2) "B" inspectors, who may inspect all areas of construction specialty, except structural. (3) "C" inspectors, who may inspect one or more areas of construction specialty, including structural, but may not inspect the scope of construction specialties authorized for "A" or "B" inspectors. (e) (1) As part of its approval process, the office shall initially and periodically examine inspectors by giving either a written examination or a written and oral examination. The office may charge a fee for the examination process calculated to cover its costs. Inspectors who have not passed a written examination shall not be approved by the office until they have successfully passed the written examination. No employee of the office performing field inspections or supervising the field inspections shall be approved as an inspector on any construction project pursuant to this chapter for a period of one year after leaving employment of the office. (2) The office shall develop regulations for the testing and approval of inspectors.


129830. From time to time, as the work of construction or alteration progresses and whenever the office requires, the architect or structural engineer, or both, in charge of construction or registered engineer in charge of other work, the inspector on the work, and the contractor shall each make a report, duly verified by him or her, upon a form prescribed by the office showing, of his or her own personal knowledge, that the work during the period covered by the report has been performed and materials used and installed are in accordance with the approved plans and specifications, setting forth detailed statements of fact as required by the office. The term "personal knowledge," as used in this section and as applied to the architect or registered engineer, or both, means the personal knowledge that is obtained by periodic visits to the project site of reasonable frequency, for the purpose of general observation of the work, and that is also obtained from the reporting of others as to the progress of the work, testing of materials, and inspection and superintendence of the work that is performed between the periodic visits of the architect or the registered engineer. Reasonable diligence shall be exercised in obtaining the facts. The term "personal knowledge," as applied to the inspector, means the actual personal knowledge that is obtained from the inspector's personal continuous inspection of the work of construction in all stages of its progress at the site where the inspector is responsible for inspection, and when work is carried out away from the site, that personal knowledge that is obtained from the reporting of others on the testing or inspection of materials and workmanship, for compliance with plans, specifications, or applicable standards. Reasonable diligence shall be exercised in obtaining the facts. The term "personal knowledge," as applied to the contractor, means the personal knowledge that is obtained from the construction of the building. The exercise of reasonable diligence to obtain the facts is required.

129835. Upon written request to the office by the governing board or authority of any hospital, the office shall make, or cause to be made, an examination and report on the condition of any hospital building subject to the payment by the governing board or authority of the actual expenses incurred by the office.


129840. Subsequent to the occurrence of any earthquake, the office may make, or cause to be made, studies of health facilities within the area involved.

129850. Except as provided in Sections 18929 and 18930, the office shall from time to time make any regulations that it deems necessary, proper, or suitable to effectually carry out this chapter. The office shall also propose and submit building standards to the California Building Standards Commission for adoption and approval pursuant to Chapter 4 (commencing with Section 18935) of Part 2.5 of Division 13 relating to seismic safety for hospital buildings.


129851. Written rules and regulations by the office to clarify the application of the California Building Standards Code pursuant to this chapter shall be made available to the public upon request.


129855. The office may enter into any agreements and contracts with any qualified person, department, agency, corporation, or legal entity, as determined by the office, when necessary in order to facilitate the timely performance of the duties and responsibilities relating to the review and inspection of architectural, mechanical, electrical, and plumbing systems of hospital buildings to be constructed or altered or buildings under construction or alteration. If the office determines that the structural review of plans for a hospital building cannot be completed without undue delay, the office may enter into contractual agreements with private structural engineers or local governments for the purpose of facilitating the timely performance of the duties and responsibilities relating to the review and inspection of plans and specifications of the structural systems of hospital construction projects. The office, with the advice of the Building Safety Board, shall prepare regulations, containing qualification criteria, for implementing the contractual agreement provisions of this section.


129856. (a) Contingent on an appropriation in the annual Budget Act, the office shall establish a program for training fire and life safety officers. The goal of this program shall be to provide a sufficient number of qualified persons to facilitate the timely performance of the office's duties and responsibilities relating to the review of plans and specifications pertaining to the design and observation of construction of hospital buildings and buildings described in paragraphs (2) and (3) of subdivision (b) of Section 129725, in order to ensure compliance with applicable facility design and construction codes and standards. (b) The office shall prepare a comprehensive report on the training program setting forth its goals, objectives, and structure. The report shall include the number of fire and life safety officers to be trained annually, a timeline for training completion, a process for gathering information to evaluate the training programs efficiency that includes dropout and retention rates, and a mechanism to annually assess the need for the training program to continue. The report shall be submitted to the Joint Legislative Budget Committee by April 1, 2007. (c) The office may establish other training programs as necessary to ensure that a sufficient number of qualified persons are available to facilitate the timely performance of the office's duties and responsibilities relating to the review of plans and specifications pertaining to the design and construction of hospital buildings and buildings described in paragraphs (2) and (3) of subdivision (b) of Section 129725, to ensure compliance with applicable safety codes and standards. (d) If additional training programs are established pursuant to subdivision (c), the office shall prepare a comprehensive report on the training program setting forth its goals, objectives, and structure. The report shall include the number of individuals trained pursuant to subdivision (c) annually, a timeline for training completion, a process for gathering information to evaluate the training programs efficiency that includes dropout and retention rates, and a mechanism to annually assess the need for the training program to continue. The report shall be submitted to the Joint Legislative Budget Committee three years after the training program has been implemented.


Article 4. Special Requirements

Ca Codes (hsc:129875-129905) Health And Safety Code Section 129875-129905



129875. Construction or alterations of buildings specified in paragraphs (2) and (3) of subdivision (b) of Section 129725 shall conform to the latest edition of the California Building Standards Code. The office shall independently review and inspect these buildings. For purposes of this section, "construction or alteration" includes the conversion of a building to a purpose specified in paragraphs (2) and (3) of subdivision (b) of Section 129725. Any construction or alteration of any building subject to this section shall be exempt from any plan review and approval or construction inspection requirement of any city or county. The office may also exempt from the plan review process or expedite those projects undertaken by an applicant for a hospital building that the office determines do not materially alter the mechanical, electrical, architectural, or structural integrity of the facility. The office shall set forth criteria to expedite projects or to implement any exemptions made pursuant to this paragraph. The Legislature recognizes the relative safety of single-story, wood-frame, and light steel frame construction for use in housing patients requiring skilled nursing and intermediate care services and it is, therefore, the intent of the Legislature to provide for reasonable flexibility in seismic safety standards for these structures. The office shall be reasonably flexible in the application of seismic standards for other buildings by allowing incidental and minor nonstructural additions or nonstructural alterations to be accomplished with simplified written approval procedures as established by the office, with the advice of the Division of the State Architect and the Office of the State Fire Marshal. The office shall implement, and modify, as necessary, criteria to exempt from the plan review process or expedite those projects for alterations of hospital buildings, and for those specified in paragraphs (2) and (3) of subdivision (b) of Section 129725 that may include, but are not limited to, renovations, remodeling, or installations of necessary equipment such as hot water heaters, air-conditioning units, dishwashers, laundry equipment, handrails, lights, television brackets, small emergency generators (up to 25 kilowatts), storage shelves, and similar plant operations equipment; and decorative materials such as wall coverings, floor coverings, and paint. The office shall include provisions for onsite field approvals by available office construction advisers and the preapproval of projects that comply with the requirements for which the office has developed standard architectural or engineering detail, or both standard architectural and engineering detail.


129875.1. (a) Notwithstanding Section 129875, projects for the construction or alterations of buildings specified in paragraph (1) of subdivision (a) of Section 129725 that are single-story, wood-frame or light steel frame construction and buildings specified in paragraphs (2) and (3) of subdivision (b) of Section 129725 shall be exempt from plan review and inspection by the office prior to construction if the facility demonstrates to the office, by written description of the project, that all of the following conditions are met: (1) The construction or alteration is undertaken to repair existing systems or to keep up the course of normal or routine maintenance. (2) The construction or alteration either restores the facility to the same operational status, or improves operational status from its operating condition immediately prior to the event, occurrence, or condition that necessitated the alteration. (3) The scope of the construction or alteration is not ordinarily within the standard of practice of a licensed architect or registered engineer. (4) The construction or alteration does not degrade the status or condition of the fire and life safety system from the status of the system immediately prior to the event, occurrence, or condition that necessitated the alteration. (b) Upon completion of construction or alteration of any building subject to this section, and prior to use of the repaired system or other subject of the construction or alteration, the office shall inspect and approve the work. The office may require an interim inspection for code compliance when walls, ceilings, or other materials or finishes will cover the final work. (c) Upon compliance with subdivision (a), the office shall issue a building permit.


129880. (a) The office may exempt from its plan review process construction or alteration projects for hospital buildings and buildings described in paragraphs (2) and (3) of subdivision (b) of Section 129725 with estimated construction costs of fifty thousand dollars ($50,000) or less. The criteria for exemption shall include, but not be limited to, plans that have been stamped and signed by the design professionals of record. (b) Projects that have been split into a series of smaller projects in order to avoid the qualifying dollar limits shall not be approved. The office shall maintain its construction observation mandate to ensure public safety and California Building Standards Code compliance for approved projects. (c) A presubmittal meeting between the office and the design professionals shall be required for construction or alteration projects for hospital buildings and buildings described in paragraphs (2) and (3) of subdivision (b) of Section 129725 with estimated construction costs of twenty million dollars ($20,000,000) or more. (d) The office may adopt regulations for this section to make specific the exemption criteria and processes authorized pursuant to subdivision (a), and the complete plan review process required pursuant to subdivision (c).


129881. (a) The office shall assess processing time for plan review, and shall provide an annual update on this assessment to the appropriate policy and fiscal committees of the Legislature no later than February 1, 2007, and no later than February 1 of each year thereafter. (b) This section shall remain in effect only until January 1, 2012, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2012, deletes or extends that date.


129885. (a) A city or county, as applicable, shall have plan review and building inspection responsibilities for the construction or alteration of buildings described in paragraph (1) of subdivision (b) of Section 129725. The building standards for the construction or alteration of buildings specified in paragraph (1) of subdivision (b) of Section 129725 established or applied by a city or county, shall not be more restrictive or comprehensive than comparable building standards established, or otherwise applied, to clinics licensed pursuant to Chapter 1 (commencing with Section 1200) of Division 2. For chronic dialysis and surgical services buildings, construction or alteration shall include conversion of a building to a purpose specified in paragraph (1) of subdivision (b) of Section 129725. (b) Upon the initial submittal to a city or county by the governing authority or owner of a hospital for plan review and building inspection services for buildings described in paragraph (1) of subdivision (b) of Section 129725 for chronic dialysis and surgical services, the city or county shall reply in writing to the hospital as to whether or not the plan review by the city or county will include a certification as to whether or not the clinic project submitted for plan review meets the clinic standards propounded by the office in the California Building Standards Code. If the city or county indicates that its review will include this certification, it shall do all of the following: (1) Apply the applicable clinic provisions of the latest edition of the California Building Standards Code. (2) Certify in writing to the applicant within 30 days of completion of construction whether or not the standards have been met. (c) If, upon initial submittal, the city or county indicates that its plan review will not include this certification, the governing authority or owner shall submit the plans to the Office of Statewide Health Planning and Development and the office shall review the plans for certification to determine whether or not the clinic project meets the standards propounded by the office in the California Building Standards Code. (d) When the office performs the certification review, the office shall charge a fee in an amount not to exceed its actual cost. (e) Notwithstanding subdivision (a), the governing authority of a hospital may request the Office of Statewide Health Planning and Development to perform plan review and building inspection services for buildings described in paragraph (1) of subdivision (b) of Section 129725 and Section 129730. The office shall perform these services upon request and shall charge an amount equal to its standard fee for the construction and alteration of hospital buildings. The construction or alteration of these buildings shall conform to the applicable provisions of the latest edition of the California Building Standards Code for purposes of the plan review and building inspection of the office pursuant to this subdivision. The office shall issue the building permit and certificate of occupancy for these facilities. (f) A building described in paragraph (1) of subdivision (b) of Section 129725 that is subject to the plan review and building inspection of the office pursuant to subdivision (e), may be designated by the governing authority or owner of the hospital as a "hospital building" as long as the building remains under the jurisdiction of the office. This hospital building shall be reviewed and inspected according to the standards and requirements of the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 (Chapter 1 (commencing with Section 129675)). (g) When a building is accepted for review by the office pursuant to subdivision (e), the governing authority of the hospital shall not request the city or county, as applicable, to conduct plan review and building inspection for any subsequent alteration of the same building, unless written notification is submitted to the office by the governing authority or owner of the hospital.


129890. (a) Notwithstanding any other provision of law, the office shall, on or before January 1, 1991, set forth and implement criteria for the alteration or construction of buildings specified in subdivision (a) of Section 129725 that provide for onsite field review and approval by construction advisers of the office and provide for preapproval of project plans that comply with the requirements for which the office has developed standard architectural or engineering detail, or both standard architectural and engineering detail. (b) Onsite field reviews shall be performed by available area construction advisers of the office. The area construction advisers shall have the responsibility to coordinate any approvals required by the State Fire Marshal. The approvals may be obtained prior to the start of construction or on a deferred basis, at the discretion of the area construction adviser. (c) An annual building permit project classified as a "field review" shall be reviewed and approved by the area construction adviser. (d) Effective January 1, 1991, all plans submitted for the alteration or construction of buildings specified in subdivision (a) of Section 129725 to the office for plan review shall be evaluated to determine if it is exempt from the plan review process or if it qualifies for an expedited plan review. The evaluation shall give priority to plans that are for minor renovation, remodeling, or installation of equipment.


129895. (a) The office shall adopt by regulations seismic safety standards for hospital equipment anchorages, as defined by the office, to include, but not be limited to, architectural, mechanical, and electrical components, supports, and attachments. Those regulations shall include criteria for the testing of equipment anchorages. (b) Any fixed hospital equipment anchorages purchased or acquired on or after either the effective date of the regulations adopted pursuant to subdivision (a) shall not be used or installed in any hospital building unless the equipment anchorages are approved by the office. (c) Manufacturers, designers, or suppliers of equipment anchorages may submit data sufficient for the office to evaluate equipment anchorages' seismic safety prior to the selection of equipment anchorages for any specific hospital building. (d) The office may charge a fee based on the actual costs incurred by it for data review, approvals, and field inspections pursuant to this section.

129900. Notwithstanding any other provision of law, plans for the construction or alteration of any hospital building, or any building specified in Section 129875, that are prepared by or under the supervision of the Department of General Services shall not require the review and approval of the office. In lieu of review and approval by the office, the Department of General Services shall certify to the office that the plans are in full conformance with all applicable building standards and the requirements of this chapter. The Department of General Services shall also observe all aspects of construction and alteration, including the architectural, structural, mechanical, plumbing and electrical systems. It is the intent of the Legislature that projects developed by, or under the supervision of, the Department of General Services shall still meet all applicable building standards published in the State Building Standards Code relating to the regulation of hospital projects where applicable, and all regulations adopted pursuant to this chapter and all other applicable state laws.


129905. Subject to the complete exemption contained in paragraphs (6) and (7) of subdivision (b) of Section 129725, and notwithstanding any other provision of law, plans for the construction or alteration of any hospital building, as defined in Section 1250, or any building specified in Section 129875, that are prepared by or under the supervision of the Department of Corrections or on behalf of the Department of the Youth Authority, shall not require the review and approval of the statewide office. In lieu of review and approval by the statewide office, the Department of Corrections and the Department of the Youth Authority shall certify to the statewide office that their plans and construction are in full conformance with all applicable building standards, including, but not limited to, fire and life and safety standards, and the requirements of this chapter for the architectural, structural, mechanical, plumbing, and electrical systems. The Department of Corrections and the Department of the Youth Authority shall use a secondary peer review procedure to review designs to ensure the adherence to all design standards for all new construction projects, and shall ensure that the construction is inspected by a competent, onsite inspector to ensure the construction is in compliance with the design and plan specifications. Subject to the complete exemption contained in paragraphs (6) and (7) of subdivision (b) of Section 129725, and notwithstanding any other provision of law, plans for the construction or alteration of any correctional treatment center that are prepared by or under the supervision of a law enforcement agency of a city, county, or city and county shall not require the review and approval of the statewide office. In lieu of review and approval by the statewide office, the law enforcement agency of a city, county, or city and county shall certify to the statewide office that the plans and construction are in full conformance with all applicable building standards, including, but not limited to, fire and life and safety standards, and the requirements of this chapter for the architectural, structural, mechanical, plumbing, and electrical systems. It is the intent of the Legislature that, except as specified in this section, all hospital buildings as defined by this chapter constructed by or under the supervision of the Department of Corrections or local law enforcement agencies, or constructed on behalf of the Department of the Youth Authority shall at a minimum meet all applicable regulations adopted pursuant to this chapter and all other applicable state laws.


Article 5. Building Safety Board

Ca Codes (hsc:129925-129960) Health And Safety Code Section 129925-129960



129925. There is in the office a Hospital Building Safety Board that shall be appointed by the director. The board shall advise the director and, notwithstanding Section 13142.6 and except as provided in Section 18945, shall act as a board of appeals in all matters relating to the administration and enforcement of building standards relating to the design, construction, alteration, and seismic safety of hospital building projects submitted to the office pursuant to this chapter. Further, notwithstanding Section 13142.6, the board shall act as the board of appeals in matters relating to all fire and panic safety regulations and alternate means of protection determinations for hospital building projects submitted to the office pursuant to this chapter.

129930. The board shall consist of 16 members appointed by the director of the office. Of the appointive members, two shall be structural engineers, two shall be architects, one shall be an engineering geologist, one shall be a geotechnical engineer, one shall be a mechanical engineer, one shall be an electrical engineer, one shall be a hospital facilities manager, one shall be a local building official, one shall be a general contractor, one shall be a fire and panic safety representative, one shall be a hospital inspector of record, and three shall be members of the general public.


129932. (a) Each member shall be appointed by the director for a term of four years and shall hold office until the appointment and qualification of his or her successor or until one year has elapsed since the expiration of the term for which he or she was appointed, whichever first occurs. No person shall serve as a member of the board for more than two consecutive terms. The director may remove any member of the board for neglect of duty or other just cause. (b) The terms of the appointive members of the board who are in office before January 1, 1994, shall expire as follows: (1) The terms of two members shall expire January 1, 1994. (2) The terms of two members shall expire January 1, 1995. (3) The terms of two members shall expire January 1, 1996. (4) The terms of two members shall expire January 1, 1997. (5) The terms of three members shall expire January 1, 1998. (6) The terms of three members shall expire January 1, 1999. The terms shall expire in the same relative order as the original appointment dates. (c) Vacancies occurring during a term shall be filled by appointment for the unexpired term.


129935. Appointive members, except for the public members, shall be qualified by close connection with hospital design and construction and highly knowledgeable in their respective fields with particular reference to seismic safety. Appointive members, except for the public members, shall be appointed from nominees recommended by the governing bodies of the Structural Engineers Association of California; the American Institute of Architects; the Earthquake Engineering Research Institute; the Association of Engineering Geologists; the Consulting Engineers and Land Surveyors of California; the California Association of Local Building Officials; the American Society for Heating, Refrigerating, and Air-Conditioning Engineers, Inc.; the California Association of Hospitals and Health Systems; the Associated General Contractors of California; the American Construction Inspectors' Association; and the California Fire Chiefs' Association. Board members shall be residents of California.


129940. (a) There shall be six ex officio members of the board, who shall be the director of the office, the State Fire Marshal, the State Geologist, the Executive Director of the California Building Standards Commission, the State Director of Health Services, and the Deputy Director of the Division of Facilities Development in the office, or their officially designated representatives. (b) The director may also appoint up to three additional ex officio members, with the advice of the chair. On January 1, 1994, director-appointed ex officio members may continue to serve until appointment of their successors by the director.


129942. (a) Only appointed members shall vote at board meetings. (b) Appointed members, ex officio members, and others appointed to a committee, including an appeal committee, by the chair, may vote at committee meetings.

129945. The chair of the board shall be an appointive member and shall be elected by a majority of the appointive members.


129950. The board shall be served by an executive director who shall be a member of the office staff.


129955. The Building Safety Board shall convene upon request of the chairperson thereof. The chairperson may convene a meeting of the board whenever it may be necessary, in the chairperson's judgment, for the board to meet. The board shall adopt rules of procedure as necessary to enable it to perform its duties. The chairperson shall, at his or her discretion, or upon instructions from the board, designate subcommittees to study and report back to the board upon any technical subject or matter for which an independent review or further study is desired.


129960. Members of the board shall be reimbursed from the Hospital Building Account in the Architecture Public Building Fund for their reasonable actual expenses in attending meetings conducted to carry out the provisions of this chapter, and they shall receive from that account per diem of one hundred dollars ($100) for each day actually spent in the discharge of official duties where attendance at one or more publicly scheduled meetings or hearings of the board is required by the board's chairperson. However, they shall receive no other compensation from that account for their services.


Article 6. Enforcement

Ca Codes (hsc:129975-129990) Health And Safety Code Section 129975-129990



129975. The director of the office may conduct studies relating to the implementation of this chapter to ensure that the implementation of its provisions results in the least amount of increases in costs, staffing, and regulation.

129980. Whenever any construction or alteration of any hospital building is being performed contrary to the provisions of this chapter, the office may order the construction or alteration stopped by written notice served upon any persons engaged in or causing the work to be done. Upon service of the written notice, all construction or alteration shall cease until an authorization to remove the notice is issued by the office. Any person so served shall, upon request made within 15 days of the written notice, be entitled to a hearing pursuant to Section 11506 of the Government Code.


129985. (a) Whenever it is necessary to make an inspection to enforce any of the provisions of this chapter or whenever the office or its authorized representatives has reasonable cause to believe that there exists in any building or upon any premises any condition or a violation of any applicable building standards that makes the building or premises unsafe, dangerous, or hazardous, the office or its authorized representatives may enter the building or premises at any reasonable time to make an inspection or to perform any authorized duty. Prior to an entry authorized by this section, the authorized representatives of the office shall first present proper identification and credentials and request entry. In the event that the building or premises are unoccupied, there shall be a reasonable effort made to locate the owner or other person or persons having control or charge of the building or premises in order to request an entry. If a request for entry is refused, the office or its authorized representatives shall have recourse to any remedy prescribed by law to secure entry. (b) Whenever the owner, occupant, or other person having control or charge of the building or premises is presented with a proper inspection warrant or other authorization prescribed by law to secure entry and a request for entry is made, the owner, occupant, or other person having control or charge of the building or premises shall promptly permit the entry of the authorized representatives of the office for the purpose of inspection and examination authorized by this chapter.

129990. The office may order the vacating of any building or structure found to have been in violation of the adopted regulations of the office and may order the use of the building or structure discontinued within the time prescribed by the office upon the service of notice to the owner or other person having control or charge of the building or structure. Any owner or person having control so served shall, upon request made within 15 days of the written notice, be entitled to a hearing pursuant to Section 11506 of the Government Code.


Article 7. Penalties

Ca Codes (hsc:129998) Health And Safety Code Section 129998



129998. (a) Any person who violates any provision of this chapter is guilty of a misdemeanor. (b) This section shall not apply to correctional treatment centers. This subdivision shall not affect any civil or administrative liability against correctional treatment centers or persons employed by these centers. This subdivision shall remain operative only until January 1, 1994.


Article 8. New State Responsibilities For Seismic Safety In Hospitals

Ca Codes (hsc:130000-130025) Health And Safety Code Section 130000-130025



130000. (a) The Legislature hereby finds and declares the following: (1) The Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 was created because of the loss of life in the collapse of hospitals during the Sylmar earthquake of 1971. (2) We were reminded of the vulnerability of hospitals in the Northridge earthquake of January 17, 1994. (3) Several hospitals built prior to the act suffered major damage and had to be evacuated. (4) Hospitals built to the Alfred E. Alquist Hospital Facilities Seismic Safety Act standards resisted the Northridge earthquakes with very little structural damage demonstrating the value and necessity of this act. (5) Both pre- and post-act hospitals suffered damage to architecture and to power and water systems that prevented hospitals from being operational, caused the loss of one life, triggered evacuations, unacceptable property losses, and added additional concerns on emergency medical response. (6) An earthquake survivability inventory of California's hospitals completed by the Office of Statewide Health Planning and Development in December 1989 indicated that over 83 percent of the state's hospital beds were in buildings that did not comply with the Alfred E. Alquist Hospital Facilities Seismic Safety Act because they were issued permits prior to the effective date of the act. Furthermore, 26 percent of the beds are in buildings posing significant risks of collapse since they were built before modern earthquake codes. The older hospitals pose significant threats of collapse in major earthquakes and loss of functions in smaller or more distant earthquakes. (7) The 1989 survey also states: "Of the 490 hospitals surveyed, nine hospitals are in Alquist-Priolo Earthquake Fault Rupture Zones, 31 are in areas subject to soil liquefaction, 14 in areas with landslide potential, 33 in flood zones, and 29 have a possible loss or disruption of access. Two hundred five hospitals had no emergency fuel for their main boilers on hand, 19 had no emergency fuel for their emergency generators. Onsite emergency potable water was available at 273 hospitals and nonpotable water was available at 102 hospitals. Four hundred eighteen hospitals had emergency radios onsite, and 419 hospitals had inadequate or partially adequate equipment anchorage. In terms of available emergency preparedness, inadequate or partially inadequate equipment anchorage is still the most widespread shortcoming." (8) This survey identifies many of the shortcomings that caused 23 hospitals to suspend some or all operations after the Northridge earthquake. However, one hospital was rebuilt to comply with the Alfred E. Alquist Hospital Facilities Seismic Safety Act after an older hospital building had partially collapsed in the 1971 Sylmar earthquake. The rebuilt hospital suffered failures in water distribution systems and had to be evacuated. (9) The state must rely on hospitals to support patients and offer medical aid to earthquake victims. (b) Therefore, it is the intent of the Legislature, that: (1) By enacting this article, the state shall take steps to ensure that the expected earthquake performance of hospital buildings housing inpatients and providing primary basic services is disclosed to public agencies that have a need and a right to know, because the medical industry cannot immediately bring all hospital buildings into compliance with the Alfred E. Alquist Hospital Facilities Seismic Safety Act. (2) The state shall encourage structural retrofits or replacements of hospital buildings housing inpatients and providing primary basic services that place lives at risk because of their potential for collapse during an earthquake. (3) The state shall also encourage retrofits and enhancements to critical hospital architecture, equipment, and utility and communications systems to improve the ability of hospitals to remain operational for those hospitals that do not pose risk to life.


130005. By June 30, 1996: (a) The Office of Statewide Health Planning and Development, hereinafter called the office, shall develop definitions of earthquake performance categories for earthquake ground motions for both new and existing hospitals that are: (1) Reasonably capable of providing services to the public after a disaster, designed and constructed to resist, insofar as practical, the forces generated by earthquakes, gravity, and winds, and in full compliance with the regulations and standards developed by the office pursuant to the Alfred E. Alquist Hospital Facilities Seismic Safety Act. (2) In substantial compliance with the pre-1973 California Building Standards Codes, but not in substantial compliance with the regulations and standards developed by the office pursuant to the Alfred E. Alquist Hospital Facilities Seismic Safety Act. These buildings may not be repairable or functional but will not significantly jeopardize life. (3) Potentially at significant risk of collapse and that represent a danger to the public. (b) The office may define other earthquake performance categories as it deems necessary to meet the intent of this article and the Alfred E. Alquist Hospital Facilities Seismic Safety Act. (c) Earthquake performance categories shall also include subgradations for risk to life, structural soundness, building contents, and nonstructural systems that are critical to providing basic services to hospital inpatients and the public after a disaster. (d) Earthquake performance categories shall, as far as practicable, use language consistent with definitions and concepts as developed in the model codes and other state and federal agencies. Where the office finds that deviations from other's definitions and concepts are necessary and warranted to comply with the intent of the Alfred E. Alquist Hospital Facilities Seismic Safety Act, the act that added this article, or the specific nature or functions of hospitals, the office shall provide supporting documentation that justifies these differences. (e) Insofar as practicable, the office shall define rapid seismic evaluation procedures that will allow owners to determine with reasonable certainty the existing applicable earthquake performance categories and the minimum acceptable earthquake performance categories for hospital buildings. These procedures shall allow for abbreviated analysis when known vulnerability is clear and when construction in accordance with post-1973 codes allows for an evaluation focusing on limited structural and nonstructural elements. (f) The office, in consultation with the Hospital Building Safety Board, shall develop regulations to identify the most critical nonstructural systems and to prioritize the timeframes for upgrading those systems that represent the greatest risk of failure during an earthquake. (g) The office shall develop regulations as they apply to the administration of seismic standards for retrofit designs, construction, and field reviews for the purposes of this article. (h) The office shall develop regulations for the purpose of reviewing requests and granting delays to hospitals demonstrating a need for more time to comply with Section 130060. (i) The office shall submit all information developed pursuant to subdivisions (a) to (f), inclusive, to the California Building Standards Commission by June 30, 1996. (j) The office shall submit all information developed pursuant to subdivisions (g) and (h) to the California Building Standards Commission by December 31, 1996. (k) "Hospital building," as used in Article 8 and Article 9 of this chapter means a hospital building as defined in Section 129725 and that is also licensed pursuant to subdivision (a) of Section 1250, but does not include these buildings if the beds licensed pursuant to subdivision (a) of Section 1250, as of January 1, 1995, comprise 10 percent or less of the total licensed beds of the total physical plant, and does not include facilities owned or operated, or both, by the Department of Corrections.


130010. The office is responsible for reviewing and approving seismic evaluation reports, compliance schedules and construction documents that are developed by hospital owners, and field review of construction for work done pursuant to this article.


130020. (a) By December 31, 1996, the California Building Standards Commission shall review, revise as necessary and adopt earthquake performance categories, seismic evaluation procedures, and standards and timeframes for upgrading the most critical nonstructural systems as developed by the office. By June 30, 1997, the California Building Standards Commission shall review, revise as necessary, and adopt seismic retrofit building standards and procedures for reviewing requests and granting delays to hospitals that demonstrate a need for more time to comply with Section 130060. (b) For purposes of this section all submittals made by the office pursuant to subdivisions (i) and (j) of Section 130005 shall be deemed as emergency regulations and adopted as such.


130022. (a) The office may utilize current computer modeling based upon software developed by FEMA, referred to as Hazards US, for the purpose of determining the structural performance category of general acute care hospital buildings. The office may promulgate regulations to implement this section. (b) Regulatory submissions made by the office to the California Building Standards Commission either pursuant to subdivision (a) or for purposes of implementing conforming changes in deadlines for compliance with any nonstructural performance category requirements shall be deemed to be emergency regulations and shall be adopted as such. (c) This section shall remain in effect only until January 1, 2013, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2013, deletes or extends that date.

130025. (a) In the event of a seismic event, or other natural or manmade calamity that the office believes is of a magnitude so that it may have compromised the structural integrity of a hospital building, or any major system of a hospital building, the office shall send one or more authorized representatives to examine the structure or system. "System" for these purposes shall include, but not be limited to, the electrical, mechanical, plumbing, and fire and life safety system of the hospital building. If, in the opinion of the office, the structural integrity of the hospital building or any system has been compromised and damaged to a degree that the hospital building has been made unsafe to occupy, the office may cause to be placed on the hospital building either a red tag, a yellow tag, or a green tag. (b) A "red" tag shall mean the hospital building is unsafe and shall be evacuated immediately. Access to red-tagged buildings shall be restricted to persons authorized by the office to enter. (c) A "yellow" tag shall mean that the hospital building has been authorized for limited occupancy, and the authorized representative of the office shall write directly on the yellow tag that portion of the hospital building that may be entered with or without restriction and those portions that may not. (d) A "green" tag shall mean the hospital building and all of its systems have been inspected by an authorized agent of the office, and have been found to be safe for use and occupancy. (e) Any law enforcement or other public safety agency of this state shall grant access to hospital buildings by authorized representatives of the office upon the showing of appropriate credentials. (f) For purposes of this section, "hospital building" includes the buildings referred to in paragraphs (2) and (3) of subdivision (b) of Section 129725.


Article 9. Hospital Owner Responsibilities

Ca Codes (hsc:130050-130070) Health And Safety Code Section 130050-130070



130050. (a) Within three years after the adoption of the standards described in Section 130020, owners of all general acute care hospitals shall: (1) Conduct seismic evaluations in accordance with procedures developed by the office pursuant to subdivision (e) of Section 130005 and submit evaluations to the office for its review and approval. (2) Identify the most critical nonstructural systems that represent the greatest risk of failure during an earthquake and submit the timetables for upgrading those systems pursuant to subdivision (f) of Section 130005 to the office for its review and approval. (3) With respect to the nonstructural performance evaluation required by this subdivision, the evaluation need not exceed those required by the nonstructural performance category the hospital owner has elected. Additional evaluations shall be obtained if the hospital owner elects to obtain a higher nonstructural performance category at a future date. A hospital owner shall report to the office all deficiencies that are pertinent to the nonstructural performance category the hospital owner has elected to attain. A complete nonstructural evaluation and list of nonstructural deficiencies shall be submitted to the office prior to the hospital owner selling or leasing the hospital to another party. (b) Within three years after the adoption of standards described in Section 130020, owners of all general acute care hospitals shall prepare a plan and compliance schedule for each building under the office's jurisdiction that indicates the steps by which the hospital intends to bring their hospital buildings into substantial compliance with the regulations and standards developed by the office pursuant to the Alfred E. Alquist Hospital Facilities Seismic Safety Act and this act, identifies the phasing out of or retrofit of noncomplying structures and systems, or outlines steps for relocation of acute care services to facilities that comply with the regulations and standards developed by the office pursuant to the Alfred E. Alquist Hospital Facilities Seismic Safety Act and this act, and presents comprehensive plans and compliance schedules to the office for its review and approval, and integrates this schedule into the facility's master plan. (c) Owners of all general acute care hospitals may be granted a one year allowance from the requirements of subdivision (b) by the office if they demonstrate a need for more time to prepare plans and compliance schedules for their buildings.


130055. Within 60 days following the office's approval of the report submitted pursuant to subdivision (b) of Section 130050, general acute hospital building owners shall do all of the following: (a) Inform the local office of emergency services or the equivalent agency, the California Emergency Management Agency, and the office, of each building's expected earthquake performance. (b) Include all pertinent information regarding the building's expected earthquake performance in emergency training, response, and recovery plans. (c) Include all pertinent information regarding the building's expected earthquake performance in capital outlay plans.


130060. (a) (1) After January 1, 2008, any general acute care hospital building that is determined to be a potential risk of collapse or pose significant loss of life shall only be used for nonacute care hospital purposes. A delay in this deadline may be granted by the office upon a demonstration by the owner that compliance will result in a loss of health care capacity that may not be provided by other general acute care hospitals within a reasonable proximity. In its request for an extension of the deadline, a hospital shall state why the hospital is unable to comply with the January 1, 2008, deadline requirement. (2) Prior to granting an extension of the January 1, 2008, deadline pursuant to this section, the office shall do all of the following: (A) Provide public notice of a hospital's request for an extension of the deadline. The notice, at a minimum, shall be posted on the office's Internet Web site, and shall include the facility's name and identification number, the status of the request, and the beginning and ending dates of the comment period, and shall advise the public of the opportunity to submit public comments pursuant to subparagraph (C). The office shall also provide notice of all requests for the deadline extension directly to interested parties upon request of the interested parties. (B) Provide copies of extension requests to interested parties within 10 working days to allow interested parties to review and provide comment within the 45-day comment period. The copies shall include those records that are available to the public pursuant to the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code). (C) Allow the public to submit written comments on the extension proposal for a period of not less than 45 days from the date of the public notice. (b) (1) It is the intent of the Legislature, in enacting this subdivision, to facilitate the process of having more hospital buildings in substantial compliance with this chapter and to take nonconforming general acute care hospital inpatient buildings out of service more quickly. (2) The functional contiguous grouping of hospital buildings of a general acute care hospital, each of which provides, as the primary source, one or more of the hospital's eight basic services as specified in subdivision (a) of Section 1250, may receive a five-year extension of the January 1, 2008, deadline specified in subdivision (a) of this section pursuant to this subdivision for both structural and nonstructural requirements. A functional contiguous grouping refers to buildings containing one or more basic hospital services that are either attached or connected in a way that is acceptable to the State Department of Health Care Services. These buildings may be either on the existing site or a new site. (3) To receive the five-year extension, a single building containing all of the basic services or at least one building within the contiguous grouping of hospital buildings shall have obtained a building permit prior to 1973 and this building shall be evaluated and classified as a nonconforming, Structural Performance Category-1 (SPC-1) building. The classification shall be submitted to and accepted by the Office of Statewide Health Planning and Development. The identified hospital building shall be exempt from the requirement in subdivision (a) until January 1, 2013, if the hospital agrees that the basic service or services that were provided in that building shall be provided, on or before January 1, 2013, as follows: (A) Moved into an existing conforming Structural Performance Category-3 (SPC-3), Structural Performance Category-4 (SPC-4), or Structural Performance Category-5 (SPC-5) and Non-Structural Performance Category-4 (NPC-4) or Non-Structural Performance Category-5 (NPC-5) building. (B) Relocated to a newly built compliant SPC-5 and NPC-4 or NPC-5 building. (C) Continued in the building if the building is retrofitted to a SPC-5 and NPC-4 or NPC-5 building. (4) A five-year extension is also provided to a post-1973 building if the hospital owner informs the Office of Statewide Health Planning and Development that the building is classified as SPC-1, SPC-3, or SPC-4 and will be closed to general acute care inpatient service use by January 1, 2013. The basic services in the building shall be relocated into a SPC-5 and NPC-4 or NPC-5 building by January 1, 2013. (5) SPC-1 buildings, other than the building identified in paragraph (3) or (4), in the contiguous grouping of hospital buildings shall also be exempt from the requirement in subdivision (a) until January 1, 2013. However, on or before January 1, 2013, at a minimum, each of these buildings shall be retrofitted to a SPC-2 and NPC-3 building, or no longer be used for general acute care hospital inpatient services. (c) On or before March 1, 2001, the office shall establish a schedule of interim work progress deadlines that hospitals shall be required to meet to be eligible for the extension specified in subdivision (b). To receive this extension, the hospital building or buildings shall meet the year 2002 nonstructural requirements. (d) A hospital building that is eligible for an extension pursuant to this section shall meet the January 1, 2030, nonstructural and structural deadline requirements if the building is to be used for general acute care inpatient services after January 1, 2030. (e) Upon compliance with subdivision (b), the hospital shall be issued a written notice of compliance by the office. The office shall send a written notice of violation to hospital owners that fail to comply with this section. The office shall make copies of these notices available on its Internet Web site. (f) (1) A hospital that has received an extension of the January 1, 2008, deadline pursuant to subdivision (a) or (b) may request an additional extension of up to two years for a hospital building that it owns or operates and that meets the criteria specified in paragraph (2), (3), or (5). (2) The office may grant the additional extension if the hospital building subject to the extension meets all of the following criteria: (A) The hospital building is under construction at the time of the request for extension under this subdivision and the purpose of the construction is to meet the requirements of subdivision (a) to allow the use of the building as a general acute care hospital building after the extension deadline granted by the office pursuant to subdivision (a) or (b). (B) The hospital building plans were submitted to the office and were deemed ready for review by the office at least four years prior to the applicable deadline for the building. The hospital shall indicate, upon submission of its plans, the SPC-1 building or buildings that will be retrofitted or replaced to meet the requirements of this section as a result of the project. (C) The hospital received a building permit for the construction described in subparagraph (A) at least two years prior to the applicable deadline for the building. (D) The hospital submitted a construction timeline at least two years prior to the applicable deadline for the building demonstrating the hospital's intent to meet the applicable deadline. The timeline shall include all of the following: (i) The projected construction start date. (ii) The projected construction completion date. (iii) Identification of the contractor. (E) The hospital is making reasonable progress toward meeting the timeline set forth in subparagraph (D), but factors beyond the hospital's control make it impossible for the hospital to meet the deadline. (3) The office may grant the additional extension if the hospital building subject to the extension meets all of the following criteria: (A) The hospital building is owned by a health care district that has, as owner, received the extension of the January 1, 2008, deadline, but where the hospital is operated by an unaffiliated third-party lessee pursuant to a facility lease that extends at least through December 31, 2009. The district shall file a declaration with the office with a request for an extension stating that, as of the date of the filing, the district has lacked, and continues to lack, unrestricted access to the subject hospital building for seismic planning purposes during the term of the lease, and that the district is under contract with the county to maintain hospital services when the hospital comes under district control. The office shall not grant the extension if an unaffiliated third-party lessee will operate the hospital beyond December 31, 2010. (B) The hospital building plans were submitted to the office and were deemed ready for review by the office at least four years prior to the applicable deadline for the building. The hospital shall indicate, upon submission of its plans, the SPC-1 building or buildings that will be retrofitted or replaced to meet the requirements of this section as a result of the project. (C) The hospital received a building permit for the construction described in subparagraph (B) by December 31, 2011. (D) The hospital submitted, by December 31, 2011, a construction timeline for the building demonstrating the hospital's intent and ability to meet the deadline of December 31, 2014. The timeline shall include all of the following: (i) The projected construction start date. (ii) The projected construction completion date. (iii) Identification of the contractor. (E) The hospital building is under construction at the time of the request for the extension, the purpose of the construction is to meet the requirements of subdivision (a) to allow the use of the building as a general acute care hospital building after the extension deadline granted by the office pursuant to subdivision (a) or (b), and the hospital is making reasonable progress toward meeting the timeline set forth in subparagraph (D). (F) The hospital granted an extension pursuant to this paragraph shall submit an additional status report to the office, equivalent to that required by subdivision (c) of Section 130061, no later than June 30, 2013. (4) An extension granted pursuant to paragraph (3) shall be applicable only to the health care district applicant and its affiliated hospital while the hospital is operated by the district or an entity under the control of the district. (5) The office may grant the additional extension if the hospital building subject to the extension meets all of the following criteria: (A) The hospital owner submitted to the office, prior to June 30, 2009, a request for review using current computer modeling utilized by the office and based upon software developed by the Federal Emergency Management Agency, referred to as Hazards US, and the building was deemed SPC-1 after that review. (B) The hospital building plans for the building are submitted to the office and deemed ready for review by the office prior to July 1, 2010. The hospital shall indicate, upon submission of its plans, the SPC-1 building or buildings that shall be retrofitted or replaced to meet the requirements of this section as a result of the project. (C) The hospital receives a building permit from the office for the construction described in subparagraph (B) prior to January 1, 2012. (D) The hospital submits, prior to January 1, 2012, a construction timeline for the building demonstrating the hospital's intent and ability to meet the applicable deadline. The timeline shall include all of the following: (i) The projected construction start date. (ii) The projected construction completion date. (iii) Identification of the contractor. (E) The hospital building is under construction at the time of the request for the extension, the purpose of the construction is to meet the requirements of subdivision (a) to allow the use of the building as a general acute care hospital building after the extension deadline granted by the office pursuant to subdivision (a) or (b), and the hospital is making reasonable progress toward meeting the timeline set forth in subparagraph (D). (F) The hospital owner completes construction such that the hospital meets all criteria to enable the office to issue a certificate of occupancy by the applicable deadline for the building. (6) A hospital denied an extension pursuant to this subdivision may appeal the denial to the Hospital Building Safety Board. (7) The office may revoke an extension granted pursuant to this subdivision for any hospital building where the work of construction is abandoned or suspended for a period of at least one year, unless the hospital demonstrates in a public document that the abandonment or suspension was caused by factors beyond its control. (g) (1) Notwithstanding subdivisions (a), (b), (c), and (f), and Sections 130061.5 and 130064, a hospital that has received an extension of the January 1, 2008, deadline pursuant to subdivision (a) or (b) also may request an additional extension of up to seven years for a hospital building that it owns or operates. The office may grant the extension subject to the hospital meeting the milestones set forth in paragraph (2). (2) The hospital building subject to the extension shall meet all of the following milestones, unless the hospital building is reclassified as SPC-2 or higher as a result of its Hazards US score: (A) The hospital owner submits to the office, no later than March 31, 2012, a letter of intent stating whether it intends to rebuild, replace, or retrofit the building, or remove all general acute care beds and services from the building, and the amount of time necessary to complete the construction. (B) The hospital owner submits to the office, no later than March 31, 2012, a schedule detailing why the requested extension is necessary, and specifically how the hospital intends to meet the requested deadline. (C) The hospital owner submits to the office, no later than September 30, 2012, an application ready for review seeking structural reassessment of each of its SPC-1 buildings using current computer modeling based upon software developed by FEMA, referred to as Hazards US. (D) The hospital owner submits to the office, no later than January 1, 2015, plans ready for review consistent with the letter of intent submitted pursuant to subparagraph (A) and the schedule submitted pursuant to subparagraph (B). (E) The hospital owner submits a financial report to the office at the time the plans are submitted pursuant to subparagraph (D). The report shall demonstrate the hospital owner's financial capacity to implement the construction plans submitted pursuant to subparagraph (D). (F) The hospital owner receives a building permit consistent with the letter of intent submitted pursuant to subparagraph (A) and the schedule submitted pursuant to subparagraph (B), no later than July 1, 2018. (3) To evaluate public safety and determine whether to grant an extension of the deadline, the office shall consider the structural integrity of the hospital's SPC-1 buildings based on its Hazards US scores, community access to essential hospital services, and the hospital owner's financial capacity to meet the deadline as determined by either a bond rating of BBB or below or the financial report on the hospital owner's financial capacity submitted pursuant to subparagraph (E) of paragraph (2). The criteria contained in this paragraph shall be considered by the office in its determination of the length of an extension or whether an extension should be granted. (4) The extension or subsequent adjustments granted pursuant to this subdivision may not exceed the amount of time that is reasonably necessary to complete the construction specified in paragraph (2). (5) If the circumstances underlying the request for extension submitted to the office pursuant to paragraph (2) change, the hospital owner shall notify the office as soon as practicable, but in no event later than six months after the hospital owner discovered the change of circumstances. The office may adjust the length of the extension granted pursuant to paragraphs (2) and (3) as necessary, but in no event longer than the period specified in paragraph (1). (6) A hospital denied an extension pursuant to this subdivision may appeal the denial to the Hospital Building Safety Board. (7) The office may revoke an extension granted pursuant to this subdivision for any hospital building when it is determined that any information submitted pursuant to this section was falsified, or if the hospital failed to meet a milestone set forth in paragraph (2), or where the work of construction is abandoned or suspended for a period of at least six months, unless the hospital demonstrates in a publicly available document that the abandonment or suspension was caused by factors beyond its control. (8) Regulatory submissions made by the office to the California Building Standards Commission to implement this section shall be deemed to be emergency regulations and shall be adopted as emergency regulations. (9) The hospital owner that applies for an extension pursuant to this subdivision shall pay the office an additional fee, to be determined by the office, sufficient to cover the additional reasonable costs incurred by the office for maintaining the additional reporting requirements established under this section, including, but not limited to, the costs of reviewing and verifying the extension documentation submitted pursuant to this subdivision. This additional fee shall not include any cost for review of the plans or other duties related to receiving a building or occupancy permit. (10) This subdivision shall become operative on the date that the State Department of Health Care Services receives all necessary federal approvals for a 2011-12 fiscal year hospital quality assurance fee program that includes three hundred twenty million dollars ($320,000,000) in fee revenue to pay for health care coverage for children, which is made available as a result of the legislative enactment of a 2011-12 fiscal year hospital quality assurance fee program.

130061. (a) An owner of a general acute care hospital building that is classified as a nonconforming Structural Performance Category-1 (SPC-1) building, who has not requested an extension of the deadline described in subdivision (a) or (b) of Section 130060, shall submit a report to the office no later than April 15, 2007, describing the status of each building in complying with the requirements of Section 130060. The report shall identify at least all of the following: (1) Each building that is subject to subdivision (a) of Section 130060. (2) The project number or numbers for retrofit or replacement of each building. (3) The projected construction start date or dates and projected construction completion date or dates. (4) The building or buildings to be removed from acute care service and the projected date or dates of this action. (b) An owner of a general acute care hospital building that is classified as a nonconforming, Structural Performance Category-1 (SPC-1) building, who has requested an extension of the deadline described in subdivision (a) or (b) of Section 130060, shall submit a report to the office no later than June 30, 2009, describing the status of each building in complying with the requirements of Section 130060. The report shall identify, at a minimum, all of the following: (1) Each building that is subject to subdivision (a) of Section 130060. (2) The project number or numbers for retrofit or replacement of each building. (3) The projected construction start date or dates and projected construction completion date or dates. (4) The building or buildings to be removed from acute care service and the projected date or dates of that action. (c) An owner of a general acute care hospital building that is classified as a nonconforming, Structural Performance Category-1 (SPC-1) building, shall submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the requirements of Section 130060, and annually thereafter shall update the office with any changes or adjustments. The report shall identify at least all of the following: (1) For each building that is subject to subdivision (a) of Section 130060 that is planned for retrofit or replacement, the report shall identify: (A) Whether the hospital owner intends to retrofit or replace the building to SPC-2, SPC-3, SPC-4, or SPC-5. (B) The deadline, as described in Section 130060 or 130061.5, for retrofit or replacement of the building that the hospital owner intends to meet, and the applicable extension for which the hospital owner has been approved. (C) The project number or numbers for retrofit or replacement of each building. (D) The projected construction start date or dates and projected construction completion date or dates. (E) The most recent project status and approvals. (F) The number of inpatient beds and patient days, by type of unit and type of service to be provided. (2) For the building or buildings to be removed from acute care service, the following information shall be included: (A) The projected date or dates the building will be removed from service. (B) The planned uses of the building or buildings to be removed from acute care service. (C) The inpatient services currently delivered in the building or buildings. (D) The number of inpatient beds and patient days, by type of unit and type of service, for the years 2008, 2009, and 2010. (E) Whether the general acute care services and beds will be relocated to a new or retrofitted building and any corresponding building sites or project numbers. (3) Each hospital owner shall also report, for each facility for which any buildings will be removed from acute care service, any net change in the number of inpatient beds, by type of unit and type of service, taking into account beds provided in buildings to be taken out of service, beds provided in buildings to be retrofitted or replaced, and beds provided in any other buildings used for general acute care inpatient services by the facility. (4) Each hospital owner shall report any general acute care hospital inpatient service that is provided in any general acute care hospital building that is rated SPC-1. (5) Each hospital owner shall report the final configuration of all buildings on its campus showing how each building will comply with the SPC-5/NPC-4 or 5 requirements, whether by retrofit or by replacement, and the type of services that will be provided in each general acute care hospital building. (d) The office shall make the information required by subdivisions (a) and (b), available on its Internet Web site within 90 days of receipt of this information. (e) The office shall make the information required by subdivision (c) available on its Internet Web site within 90 days of receipt of this information. The office shall include the hospital name, hospital owners, and location of the buildings included in the report, and, to the extent possible, for service areas containing buildings for which hospital owners report information pursuant to subdivision (c), include information on the number of inpatient beds, by type of unit and type of service, provided by facilities operating buildings that are classified as SPC-2, SPC-3, SPC-4, and SPC-5. (f) Hospitals that have not reported pursuant to this section are not eligible for the extension provided in subdivision (f) of Section 130060. (g) A hospital that has not submitted a report pursuant to this section shall be assessed a fine of ten dollars ($10) per licensed acute care bed per day, but in no case to exceed one thousand dollars ($1,000) per day for each SPC-1 building not in compliance with this section until it has complied with the provisions of this section. These fines shall be deposited into the Hospital Building Fund as specified pursuant to Section 129795. A hospital assessed a fine pursuant to this section may appeal the assessment to the Hospital Building Safety Board.

130061.5. (a) The Legislature finds and declares the following: (1) By enacting this section, the Legislature reinforces its commitment to ensuring the seismic safety of hospitals in California. In order to meet that commitment, this section provides a mechanism for hospitals that lack the financial capacity to retrofit Structural Performance Category-1 (SPC-1) buildings by 2013 to, instead, redirect available capital and borrowing capacity to replace those building by 2020. The mechanism is intended to allow these hospitals to meet the seismic requirements, and provide state agencies and the public with more timely and detailed information about the progress these hospitals are making toward seismic safety compliance. (2) This section requires hospitals seeking this assistance to demonstrate that their financial condition does not allow them to retrofit these buildings by 2013, and requires them to meet specified benchmarks in order to be eligible for the extended timelines set forth in this section. Failure to meet any of these benchmarks shall result in the hospital being noncompliant and subject the hospital to loss of licensure. (3) It is the intent of the Legislature to ensure the continuation of services in medically underserved communities in which the closure of the hospital would have significant negative impacts on access to health care services in the community. (4) It is also the intent of the Legislature that this section be implemented very narrowly to target only facilities that are essential providers in underserved communities and that lack the financial capacity to retrofit SPC-1 buildings by 2013. (b) A hospital owner may meet the requirements of subdivision (a) of Section 130060 by replacing all of its buildings subject to that subdivision by January 1, 2020, if it meets all of the following conditions: (1) The hospital owner has requested an extension of the deadline described in subdivision (a) or (b) of Section 130060. (2) (A) The office certifies that the hospital owner lacks the financial capacity to meet the requirements of subdivision (a) of Section 130060 for that building. In order to receive the certification, the hospital owner shall file with the office by January 1, 2009, financial information as required by the office. This information shall include a schedule demonstrating that, as of the end of the hospital owner's most recent fiscal year for which the hospital owner has filed its annual financial data with the office by July 1, 2007, the hospital owner's annual financial data for that fiscal year show that the hospital owner meets all of the following financial conditions: (i) The owner's net long-term debt to capitalization ratio, as measured by the ratio of net long-term debt to net long-term debt plus equity, was above 60 percent. (ii) The owner's debt service coverage, as measured by the ratio of net income plus depreciation expense plus interest expense to current maturities on long-term debt plus interest expense, was below 4.5. (iii) The owner's cash-to-debt ratio, as measured by the ratio of cash plus marketable securities plus limited use cash plus limited use investments to current maturities on long-term debt plus net long-term debt, was below 90 percent. (B) The office shall certify that a hospital owner applying for relief under this subdivision meets each of these financial conditions. For the purposes of this subdivision, a hospital owner shall be eligible for certification only if the annual financial data required by this paragraph for the hospital owners and all of its hospital affiliates, considered in total, meets all of these financial conditions. For purposes of this section, "hospital affiliate" means any hospital owned by an entity that controls, is controlled by, or is under the common control of, directly or through intermediate entity, the entity that owns the specified hospital. The applicant hospital owner shall bear all costs for review, but not to exceed the costs of review, of its financial information. (3) The hospital owner files with the office, by January 1, 2009, a declaration that the hospital for which the hospital owner is seeking relief under this subdivision shall satisfy all of the following conditions: (A) The hospital shall maintain a contract with the California Medical Assistance Commission (CMAC) under the selective provider contracting program, unless in an open area as established by CMAC. (B) The hospital shall maintain at least basic emergency medical services if the hospital provided emergency medical services at the basic or higher level as of July 1, 2007. (C) The hospital meets any of the following criteria: (i) The hospital is located within a Medically Underserved Area or a Health Professions Shortage Area designated by the federal government pursuant to Sections 330 and 332 of the federal Public Health Service Act (42 U.S.C. Secs. 254b and 254e). (ii) The office determines, by means of a health impact assessment, that removal of the building or buildings from service may diminish significantly the availability or accessibility of health care services to an underserved community. (iii) The CMAC determines that the hospital is essential to providing and maintaining Medi-Cal services in the hospital's service area. (iv) The hospital demonstrates that, based on annual utilization data submitted to the office for 2006 or later, the hospital had in one year over 30 percent of all discharges for either Medi-Cal or indigent patients in the county in which the hospital is located. (4) The hospital owner submits, by January 1, 2010, a facility master plan for all the buildings that are subject to subdivision (a) of Section 130060 that the hospital intends to replace by January 1, 2020. The facility master plan shall identify at least all of the following: (A) Each building that is subject to subdivision (a) of Section 130060. (B) The plan to replace each building with buildings that would be in compliance with subdivision (a) of Section 130065. (C) The building or buildings to be removed from acute care service and the projected date or dates of that action. (D) The location for any new building or buildings, including, but not limited to, whether the owner has received a permit for that location. The replacement buildings shall be planned within the same service area as the buildings to be removed from service. (E) A copy of the preliminary design for the new building or buildings. (F) The number of beds available for acute care use in each new building. (G) The timeline for completed plan submission. (H) The proposed construction timeline. (I) The proposed cost at the time of submission. (J) A copy of any records indicating the hospital governing board' s approval of the facility plan. (5) By January 1, 2013, the hospital owner submits to the office a building plan that is deemed ready for review by the office, for each building. (6) By January 1, 2015, the hospital owner receives a building permit to begin construction, for each building that the owner intends to replace pursuant to the master plan. (7) Within six months of receipt of the building permit, the hospital owner submits a construction timeline that identifies at least all of the following: (A) Each building that is subject to subdivision (a) of Section 130060. (B) The project number or numbers for replacement of each building. (C) The projected construction start date or dates and projected construction completion date or dates. (D) The building or buildings to be removed from acute care. (E) The estimated cost of construction. (F) The name of the contractor. (8) Every six months thereafter, the hospital owner reports to the office on the status of the project, including any delays or circumstances that could materially affect the estimated completion date. (9) The hospital owner pays to the office an additional fee, to be determined by the office, sufficient to cover the additional cost incurred by the office for maintaining all reporting requirements established under this section, including, but not limited to, the costs of reviewing and verifying the financial information submitted pursuant to paragraph (2). This additional fee shall not include any cost for review of the plans or other duties related to receiving a building or occupancy permit. (c) The office may also approve an extension of the deadline described in subdivision (a) or (b) of Section 130060 for a general acute care hospital building that is classified as a nonconforming SPC-1 building and is owned or operated by a county, city, or county and city that has requested an extension of this deadline by June 30, 2009, if the owner files a declaration with the office stating that as of the date of that filing the owner lacks the ability to meet the requirements of subdivision (a) of Section 130060 for that building pursuant to subdivision (b) of that section. The declaration shall state the commitment of the hospital to replace those buildings by January 1, 2020, with other buildings that meet the requirements of Section 130065 and shall meet the requirements of paragraphs (4) to (9), inclusive, of subdivision (b). (d) A hospital filing a declaration pursuant to this section but failing to meet any of the deadlines set forth in this section shall be deemed in violation of this section and Section 130060, and shall be subject to loss of licensure.


130063. (a) With regard to a general acute care hospital building located in Seismic Zone 3 as indicated in the 1995 edition of the California Building Standards Code, any hospital may request an exemption from Non-Structural Performance Category-3 requirements in Title 24 of the California Code of Regulations if the hospital building complies with the year 2002 nonstructural requirements. (b) The office shall determine the maximum allowable level of earthquake ground shaking potential for purposes of this section. (c) To qualify for an exemption under this section, a hospital shall provide a site-specific engineering geologic report that demonstrates an earthquake ground shaking potential below the maximum allowable level of earthquake ground shaking potential determined by the office pursuant to subdivision (b). (d) (1) To demonstrate an earthquake ground shaking potential as provided in subdivision (c), a hospital shall submit a site-specific engineering geologic report to the office. (2) The office shall forward the report received from a hospital to the Division of Mines and Geology in the Department of Conservation for purposes of a review. (3) If, after review of the analysis, the Division of Mines and Geology concurs with the findings of the report, it shall return the report with a statement of concurrence to the office. Upon the receipt of the statement, if the ground shaking potential is below that established pursuant to subdivision (b), the office shall grant the exemption requested. (e) A hospital building that is eligible for an exemption under this section shall meet the January 1, 2030, nonstructural requirement deadline if the building is to be used for general acute care inpatient services after January 1, 2030. (f) A hospital requesting an exemption pursuant to this section shall pay the actual expenses incurred by the office and the Division of Mines and Geology. (g) All regulatory submissions to the California Building Standards Commission made by the office for purposes of this section shall be deemed to be emergency regulations and shall be adopted as emergency regulations. This emergency regulation authority shall remain in effect until January 1, 2004.


130063.1. Notwithstanding Section 130063, a county-owned general acute care hospital building is allowed an extension of the Non-structural Performance Category-2 requirements of Title 24 of the California Code of Regulations if all of the following conditions are met: (a) The county submitted the compliance plan on or before January 1, 2001. (b) The county submitted the Non-structural Performance Category-2 building plans to the Office of Statewide Health Planning and Development on or before September 1, 2001. (c) The county complies with the year 2002 nonstructural requirements established by regulation 12 months after receipt of the building permit approval letter from the Office of Statewide Health Planning and Development.


130063.2. Notwithstanding Section 130063, an existing county-owned general acute care hospital building may receive a one-year extension of the January 1, 2002, deadline for the Non-structural Performance Category-2 requirements in Title 24 of the California Code of Regulations if all of the following conditions are met: (a) The existing hospital building is removed from general acute care service on or before January 1, 2003. (b) Construction of the replacement building that will meet the 2030 nonstructural and structural deadline requirements, which commenced before January 1, 2001, is completed by January 1, 2003.


130064. (a) In lieu of the extension described in subdivision (f) of Section 130060, the office may grant an extension to a general acute care hospital pursuant to either subdivision (c) or (f) if the hospital building will not meet the seismic safety standards of that section by January 1, 2013, due to a local planning delay. (b) When applying for an extension under this section, the owner of the general acute care hospital shall submit to the office documentation that includes at least all of the following: (1) The original schedule of the project or projects as had been originally anticipated. (2) The schedule of the project or projects as currently projected. (3) A timeline for the submission of documents to the local planning authority or jurisdiction. (4) Documentation that the local planning authority for the project and for the enabling phases of the project does not grant approvals prior to November 1, 2010, where the hospital had originally filed the local application prior to January 1, 2008. (5) A proposed construction timeframe demonstrating the completion of the project once the permit is issued. The construction timeframe shall be approved by the office and shall only include the amount of time that is reasonably necessary to complete the construction required to meet the seismic safety requirements. (c) The office may grant an extension, in full one-year increments, but no longer than three consecutive years, that compensates for delays determined pursuant to subdivision (d). (d) The office shall conduct a comprehensive review of the schedule for the project or projects according to criteria specified in this section. This review shall encompass the project or projects under the jurisdiction of the office, as well as other project phases not under the jurisdiction of the office. The office shall consider the cumulative effect of local approval timelines for all elements of the project or projects, inclusive of changes in scope or sequence of the project or projects required by the local planning process. The office may grant extensions based on an evaluation of each of the following circumstances: (1) Where the local planning authority approvals have delayed or will delay the construction start date of the project or projects. (2) Where the local conditions of approval on a project or projects extend the duration beyond the originally anticipated construction completion date. (3) Where the cumulative effect of delays on the project or projects creates additional construction delays due to local seasonal weather impact requirements of the local planning authority. (4) Construction related to the seismic retrofit or replacement project has begun by January 1, 2013. (5) The project or projects were submitted for review by the department no later than January 1, 2009. (6) The project or projects have received a building permit from the department no later than January 1, 2012. (e) Every six months after the approval of the extension, the hospital owner shall report to the office on the status of the project or projects, demonstrating that it is making reasonable progress toward meeting the construction timeline. (f) The office may grant an additional extension of up to two years in addition to the extension granted pursuant to subdivisions (c) and (d) only if the project or projects meet all of the following criteria: (1) A matrix of buildings at the hospital that identifies compliance of each building to the standards required by Section 130065 at the completion of the project or projects. (2) The construction timelines submitted pursuant to subdivision (a) were determined to go beyond three years from the date the building permit was issued. (3) Acute care services will not be provided in any SPC-1 building at any time during the extension. (4) The hospital demonstrates that it has, and maintains throughout the extension, life safety systems in all acute care patient care areas that do not depend on, and are not routed through, an SPC-1 building. (5) The hospital either demonstrates that the SPC-1 building does not pose a structural risk to an adjoining hospital building that is used for acute care services or mitigates the risk in accordance with a deadline described in subdivision (f) of Section 130060 that the office determines will best protect patient safety. (g) The office may revoke an extension granted pursuant to this section for any hospital building where the work of construction is abandoned or suspended for a period of at least six months, unless the hospital demonstrates that the abandonment or suspension was caused by factors beyond its control. (h) The office may revoke an extension granted pursuant to this section if it is determined that any information submitted pursuant to this section was falsified in any manner by the hospital or if the hospital fails to meet any of the criteria or conditions specified in this section. (i) Regulatory submissions made by the office to the California Building Standards Commission pursuant to this section shall be deemed, and shall be adopted as, emergency regulations. (j) The hospital owner that applies for an extension pursuant to this section shall pay to the office an additional fee, to be determined by the office, sufficient to cover the additional cost incurred by the office for maintaining all reporting requirements established under this section, including, but not limited to, the costs of reviewing and verifying the extension documentation submitted pursuant to this section. This additional fee shall not include any cost for review of the plans or other duties related to receiving a building or occupancy permit. (k) A hospital denied an extension pursuant to this section may appeal the denial to the Hospital Building Safety Board.


130065. In accordance with the compliance schedule approved by the office, but in any case no later than January 1, 2030, owners of all acute care inpatient hospitals shall either: (a) Demolish, replace, or change to nonacute care use all hospital buildings not in substantial compliance with the regulations and standards developed by the office pursuant to the Alfred E. Alquist Hospital Facilities Seismic Safety Act and this act. (b) Seismically retrofit all acute care inpatient hospital buildings so that they are in substantial compliance with the regulations and standards developed by the office pursuant to the Alfred E. Alquist Hospital Facilities Seismic Safety Act and this act. Upon compliance with this section, the hospital shall be issued a written notice of compliance by the office. The office shall send a written notice of violation to hospital owners that fail to comply with this section.


130070. The office shall notify the State Department of Health Services of the hospital owners that have received a written notice of violation for failure to comply with either Section 130060 or 130065. Unless the hospital places its license in voluntary suspense, the state department shall suspend or refuse to renew the license of a hospital that has received a notice of violation from the office because of its failure to comply with either Section 130060 or 130065. The license shall be reinstated or renewed upon presentation to the state department of a written notice of compliance issued by the office.


Chapter 2. Clinic Construction Standards(reserved)


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