Amended in Senate June 9, 2016

Amended in Senate May 23, 2016

Amended in Assembly April 11, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2024


Introduced by Assembly Member Wood

(Coauthors: Assembly Members Bigelow, Dahle, Gallagher, and Obernolte)

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(Coauthor: Senator Gaines)

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February 16, 2016


An act to amend Section 2401 of the Business and Professions Code, relating to healing arts.

LEGISLATIVE COUNSEL’S DIGEST

AB 2024, as amended, Wood. Critical access hospitals: employment.

Existing law, the Medical Practice Act, restricts the employment of physicians and surgeonsbegin delete andend deletebegin insert orend insert doctors of podiatric medicine by a corporation or other artificial legal entity to entities that do not charge for professional services rendered to patients and are approved by the Medical Board of California, subject to specified exemptions.begin insert Existing law establishes the Office of Statewide Health Planning and Development, which succeeds to and is vested with all the duties, powers, responsibilities, and jurisdiction of the State Department of Public Health relating to health planning and research development.end insert

This bill, until January 1, 2024, would also authorize a federally certified critical access hospital to employ those medical professionals and charge for professional services rendered by those medical professionals if the medical staff concur by an affirmative vote that the professional’s employment is in the best interest of the communities served by the hospital and the hospital does not direct or interfere with the professional judgment of a physician and surgeon, as specified. The bill would require thebegin delete board,end deletebegin insert office,end insert on or before July 1, 2023, to provide a report to the Legislature containing data on the impact of this authorization on federally certified critical access hospitals and their ability to recruit and retain physicians and surgeons, as specified.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 2401 of the Business and Professions
2Code
is amended to read:

3

2401.  

(a) Notwithstanding Section 2400, a clinic operated
4primarily for the purpose of medical education by a public or
5private nonprofit university medical school, which is approved by
6the board or the Osteopathic Medical Board of California, may
7charge for professional services rendered to teaching patients by
8licensees who hold academic appointments on the faculty of the
9university, if the charges are approved by the physician and surgeon
10in whose name the charges are made.

11(b) Notwithstanding Section 2400, a clinic operated under
12subdivision (p) of Section 1206 of the Health and Safety Code
13may employ licensees and charge for professional services rendered
14by those licensees. However, the clinic shall not interfere with,
15control, or otherwise direct the professional judgment of a
16physician and surgeon in a manner prohibited by Section 2400 or
17any other law.

18(c) Notwithstanding Section 2400, a narcotic treatment program
19operated under Section 11876 of the Health and Safety Code and
20regulated by the State Department of Health Care Services, may
21employ licensees and charge for professional services rendered by
22those licensees. However, the narcotic treatment program shall
23not interfere with, control, or otherwise direct the professional
24judgment of a physician and surgeon in a manner prohibited by
25Section 2400 or any other law.

26(d) Notwithstanding Section 2400, a hospital that is owned and
27operated by a licensed charitable organization, that offers only
28 pediatric subspecialty care, that, prior to January 1, 2013, employed
P3    1licensees on a salary basis, and that has not charged for professional
2services rendered to patients may, commencing January 1, 2013,
3charge for professional services rendered to patients, provided the
4following conditions are met:

5(1) The hospital does not increase the number of salaried
6licensees by more than five licensees each year.

7(2) The hospital does not expand its scope of services beyond
8pediatric subspecialty care.

9(3) The hospital accepts each patient needing its scope of
10services regardless of his or her ability to pay, including whether
11the patient has any form of health care coverage.

12(4) The medical staff concur by an affirmative vote that the
13licensee’s employment is in the best interest of the communities
14served by the hospital.

15(5) The hospital does not interfere with, control, or otherwise
16direct a physician and surgeon’s professional judgment in a manner
17prohibited by Section 2400 or any other law.

18(e) (1) Notwithstanding Section 2400, until January 1, 2024, a
19federally certified critical access hospital may employ licensees
20and charge for professional services rendered by those licensees
21to patients, provided both of the following conditions are met:

22(A) The medical staff concur by an affirmative vote that the
23licensee’s employment is in the best interest of the communities
24served by the hospital.

25(B) The hospital does not interfere with, control, or otherwise
26direct a physician and surgeon’s professional judgment in a manner
27prohibited by Section 2400 or any other law.

28(2) (A) On or before July 1, 2023, thebegin delete boardend deletebegin insert end insertbegin insertOffice of Statewide
29Health Planning and Developmentend insert
shall provide a report to the
30Legislature containing data about the impact of paragraph (1) on
31federally certified critical access hospitals and their ability to recruit
32and retain physicians and surgeons between January 1, 2017, and
33January 1, 2023, inclusive. This report shall be submitted in
34compliance with Section 9795 of the Government Code.

35(B) The requirement for submitting a report imposed under
36subparagraph (A) is inoperative on July 1, 2027.



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