BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                       AB 502


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          ASSEMBLY THIRD READING


          AB  
          502 (Chau)


          As Amended  June 2, 2015


          Majority vote


           ------------------------------------------------------------------- 
          |Committee       |Votes |Ayes                 |Noes                 |
          |                |      |                     |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Business &      |10-4  |Bonilla, Jones,      |Baker, Chang, Gatto, |
          |Professions     |      |Bloom, Campos, Dodd, |Wilk                 |
          |                |      |Eggman, Holden,      |                     |
          |                |      |Mullin, Ting, Wood   |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Health          |11-7  |Bonta, Bonilla,      |Maienschein, Chávez, |
          |                |      |Burke, Chiu, Gomez,  |Gonzalez, Lackey,    |
          |                |      |Nazarian,            |Patterson,           |
          |                |      |                     |Steinorth, Waldron   |
          |                |      |                     |                     |
          |                |      |Ridley-Thomas,       |                     |
          |                |      |Rodriguez, Santiago, |                     |
          |                |      |Thurmond, Wood       |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Appropriations  |13-3  |Gomez, Bloom, Bonta, |Bigelow, Chang,      |
          |                |      |Calderon, Daly,      |Gallagher            |
          |                |      |Eggman, Eduardo      |                     |
          |                |      |Garcia, Holden,      |                     |
          |                |      |Jones, Quirk,        |                     |








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          |                |      |Rendon, Wagner,      |                     |
          |                |      |Weber                |                     |
          |                |      |                     |                     |
          |                |      |                     |                     |
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          SUMMARY:  Requires insurance companies to reimburse registered  
          dental hygienists in alternative practice (RDHAPs) for dental  
          hygiene care legally provided and covered by insurance, and  
          clarifies that RDHAPs are authorized to establish corporations.   
          Specifically, this bill:  


          1)Exempts professional corporations, rendering professional  
            services by persons duly licensed by the Dental Hygiene  
            Committee of California (DHCC), from the requirement to obtain a  
            certificate of registration in order to render those  
            professional services, and specifies that RDHAPs may be  
            shareholders, officers, or directors of an RDHAP corporation,  
            and that licensed dentists and dental assistants may be  
            professional employees of an RDHAP corporation.  


          2)Requires health care service plan contracts covering dental  
            services, specialized health care service plan contracts  
            covering dental services, health insurance policies covering  
            dental services, and specialized health insurance policies  
            covering dental services issued, amended, or renewed on or after  
            January 1, 2016, to reimburse RDHAPs for performing dental  
            hygiene services that may lawfully be performed by registered  
            dental hygienists (RDH) and that are reimbursable under the  
            contracts or policies, and would require the plan or insurer to  
            use the same fee schedule for reimbursing both registered dental  
            hygienists and RDHAP. 


          3)Makes other clarifying and conforming changes.  









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          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee, any costs to the California Department of Insurance and  
          the Department of Managed Health Care to assess compliance with  
          this bill's requirements are expected to be minor and absorbable. 


          COMMENTS:


          Purpose.  This bill is sponsored by the California Dental  
          Hygienists' Association.  According to the author, "A number of  
          situations reduce access to RDHAPs... [M]any dental insurance  
          companies recognize dentists in a dental practice as the billable  
          provider of dental hygiene services and even though RDHAPs provide  
          the same billable services that an RDH provide, billed by the  
          dentist, the insurance companies are denying RDHAP's reimbursement  
          for services.  This forces patients who cannot easily access care  
          in a traditional dental office to pay out of pocket for the  
          services of a RDHAP or not receive the care due to finances? [The  
          BPC] authorizes RDHAPs to incorporate. Corporation law would  
          protect the RDHAP's business, however, there is not language in  
          the Corporations Code authorizing RDHAPs to establish  
          corporations, leaving them without critical protections.  [This  
          bill] would address these issues and ensure that the public has  
          access to quality dental hygiene services."


          Background.  In 1986, the Office of Statewide Health Planning and  
          Development (OSHPD) created the RDHAP.  In 1993, the professional  
          designation was made permanent in statute.  An RDHAP must have  
          been engaged in the practice of dental hygiene as a registered  
          dental hygienist in any setting, including educational settings  
          and public health settings, for a minimum of 2,000 hours during  
          the immediately preceding 36 months, complete 150 additional hours  
          of education courses, and pass a written exam.  An RDHAP has a  
          unique distinction in that they can work for a dentist or as an  
          employee of another RDHAP as an independent contractor, as a sole  
          proprietor of an alternative hygiene practice, or other locations  








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          such as residences of the homebound, schools, residential  
          facilities, and in underserved dental shortage areas, as  
          determined by OSHPD.  They may also operate a mobile dental clinic  
          or operate an independent office or offices.  


          As a result, RDHAPs may practice in settings outside of the  
          traditional dental office, and allow patients to receive the same  
          type of professional preventive care they would receive in a  
          dental office in schools, skilled and residential care facilities,  
          hospitals, private homes, and in some instances in an RDHAP's own  
          office.  A 2009 survey of California RDHAPs found that more than  
          two-thirds of their patients had no other source of oral health  
          care.  RDHAPs also struggle to find referrals to dentists for  
          patients in need of more advanced care and charge lower fees than  
          dentists. 


          The DHCC licenses and regulates approximately 509 RDHAPs.  


          Reimbursement for Services.  Currently, many dental insurance  
          companies recognize dentists in a dental practice as the billable  
          provider of dental hygiene services and even though RDHAPs provide  
          the same billable services that an RDH provide, billed by the  
          dentist, the insurance companies are denying RDHAP's reimbursement  
          for services.  In its 2014 Sunset Review Report, the DHCC  
          identified as a barrier to RDHAP practice the inability for RDHAPs  
          to collect payment for services rendered.  The DHCC noted that  
          RDHAPs have difficulty collecting payment for services from  
          insurance companies based outside of California.  This is because  
          not all states have the RDHAP provider status making them  
          ineligible for reimbursement.  As a result, some patients who  
          cannot easily access care in a traditional dental office are  
          forced to pay out of pocket for the services of a RDHAP or not  
          receive care due to financial constraints.  


          Professional Corporations.  A professional corporation is an  








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          organization made up of individuals of the same trade or  
          profession.  The Moscone-Knox Professional Corporations Act of  
          1968 authorized the formation of professional corporations to  
          obtain certain benefits of the corporate form of doing business,  
          such as limited legal liability.  At that time, only medical, law  
          and dental professional corporations were envisioned; there are  
          now 15 authorized healing arts professional corporations.  Current  
          law specifies which healing arts licensees may be shareholders,  
          officers, directors or professional employees of professional  
          corporations controlled by a differing profession if the sum of  
          all shares owned by those licensed persons does not exceed 49% of  
          the total shares of the professional corporation.  


          Business and Professions Code Section 1962 authorizes an  
          association, partnership, corporation, or group of three or more  
          registered RDHAPs to practice under an assumed or fictitious name  
          if the association, partnership, corporation, or group holds a  
          permit issued by the DHCC authorizing the holder to use that name  
          connection with the holder's practice, as specified.  According to  
          the sponsors, this section was intended to allow RDHAPs to  
          incorporate to gain the protections afforded by corporation law,  
          most importantly, protection against personal liability.  However,  
          conforming changes were not made to the Corporations Code.  This  
          bill would specify that RDHAPs may be shareholders, officers, or  
          directors of an RDHAP corporation, and specify that licensed  
          dentists and dental assistants may be professional employees of an  
          RDHAP corporation.




          Analysis Prepared by:                                               
                          Eunie Linden / B. & P. / (916) 319-3301  FN:  
          0000884












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