Existing law provides for the licensure and regulation of health facilities, including general acute care hospitals, by the State Department of Public Health. Existing law authorizes a general acute care hospital, as defined, to offer special services, including, but not limited to, emergency medical services. Existing law requires a hospital that provides emergency medical services to provide notice of the planned reduction or elimination of those services to certain entities and the public, as specified. Existing law requires a health facility that implements a downgrade or change in services to make a reasonable effort to inform the community that it serves of the downgrade or change, as specified. Existing law authorizes the department to exempt a hospital from those disclosure requirements upon specified circumstances.

This bill would make legislative findings and declarations as to the necessity of a special statute for the communities of San Clemente, Dana Point, and San Juan Capistrano.

This bill would declare that it is to take effect immediately as an urgency statute.

Existing law provides for the licensure and regulation of health facilities, including general acute care hospitals, by the State Department of Public Health. Existing law authorizes a general acute care hospital, as defined, to offer special services, including, but not limited to, emergency medical services. Existing law requires a hospital that provides emergency medical services to provide notice of the planned reduction or elimination of those services to certain entities and the public, as specified. Existing law requires a health facility that implements a downgrade or change in services to make a reasonable effort to inform the community that it serves of the downgrade or change, as specified. Existing law authorizes the department to exempt a hospital from those disclosure requirements upon specified circumstances.

This bill would require a general acute care hospital that provides emergency medical services that is scheduled for closure to conduct public hearings for public review and comment, as specified. The bill would also authorize Saddleback Memorial Medical Center, San Clemente, to continue, under its existing license, to provide emergency medical services to patients in the region if it otherwise transforms its delivery of services.

This bill would make legislative findings and declarations as to the necessity of a special statute for the communities of San Clemente, Dana Point, and San Juan Capistrano.

This bill would declare that it is to take effect immediately as an urgency statute.

Date of Hearing: January 12, 2016

ASSEMBLY COMMITTEE ON HEALTH

Rob Bonta, Chair

ABPCA Bill Id:AB 911

Author:(Brough) – As Amended Ver:April 14, 2015

SUBJECT: Hospitals: closures.

SUMMARY: Authorizes Saddleback Memorial Medical Center (SMMC) to operate an emergency department (ED) at its San Clemente campus after the hospital at that site is closed. Contains an urgency clause to ensure that the provisions of this bill go into immediate effect upon enactment. Specifically, this bill:

1. Allows SMMC to operate an ED at its San Clemente campus if the following requirements are met:
   1. The ED is operated under the consolidated license of SMMC and meets all of the requirements imposed under that license, including being within 15 miles of its parent hospital;
   2. The ED is converted from a previously existing acute care campus and not a newly developed freestanding ED;
   3. The ED is open 24 hours a day, 365 days a year;
   4. The ED is staffed with at least one board-certified emergency physician at all times;
   5. The ED is staffed with properly trained emergency room (ER) nurses and meets the minimum staffing requirements for EDs in this state;
   6. The ED has a complete range of laboratory and diagnostic radiology services, including a complete array of lab test, basic X-ray, computerized tomography (CT) scan, and ultrasound capabilities;
   7. The ED meets the specialty call requirements, as defined by the Orange County Emergency Medical Services Agency, under its consolidated license;
   8. The ED has transfer agreements with specialty centers, such as trauma, burn, and pediatric centers, to meet the needs of the injury or patient population served in the community; and,
   9. The ED has a fully functioning transport program with the capability to safely transport patients who require admission to its parent hospital or other higher level of care and specialty services facilities, such as trauma, burn, and pediatric facilities.
2. Requires all applicable federal and state regulatory requirements to be met under the consolidated license of SMMC, including all applicable regulations of the Centers for Medicare and Medicaid Services (CMS) and Title 22 of the California Code of Regulations.
   
3. Specifies that nothing in this bill requires the hospital to provide for acute care services at the San Clemente Campus, or to seek additional licensure for operation of the ED.

EXISTING LAW:

1. Provides for the licensure and regulation of health facilities by the California Department of Public Health (DPH).
2. Defines a general acute care hospital as a health facility having a governing body with administrative and professional responsibility and organized medical staff that provides 24-hour care, including the following basic services: medical; nursing; surgical; anesthesia; laboratory; radiology; pharmacy; and, dietary.
3. Authorizes DPH to grant a special permit for a health facility to provide one or more special services, including emergency center services.
4. Defines an ED as being located in a hospital licensed to provide emergency medical services (EMS).
5. Requires DPH to issue a single consolidated license to a general acute care hospital that includes more than one physical plant maintained and operated on separate premises or that has multiple licenses for a single health facility on the same premises if the general acute care hospital meets certain criteria and applicable requirements of licensure.

EXISTING STATE REGULATIONS:

1. Define comprehensive EMS as the provision of diagnostic and therapeutic services for unforeseen physical and mental disorders which, if not promptly treated, would lead to marked suffering, disability, or death. The scope of services is comprehensive with in-house capabilities for managing all medical situations on a definitive and continuing basis.
2. Detail the requirements for providing comprehensive EMS which include, among other things:
   1. EMS are to be located in the hospital so as to have ready access to all necessary services;
   2. Comprehensive EMS are to be identified to the public by an exterior sign, clearly visible form public thoroughfares which states: COMPREHENSIVE EMERGENCY MEDICAL SERVICE PHYSICIAN ON DUTY; and,
   3. Requiring radiological services, clinical laboratory services, and surgical services to be immediately available for life-threatening situations.
3. Detail the requirements for comprehensive EMS staff which includes:
   1. A full-time physician trained and experienced in emergency medicine;
   2. Provides continuous staffing with physicians trained and experienced in EMS, and requires such physicians to be assigned to and be located in the emergency service area 24 hours a day; and,
   3. Provides experienced physicians in specialty categories to be available in-house 24 hours a day, including such specialties as medicine, surgery, anesthesiology, orthopedics, neurosurgery, pediatrics, and obstetrics-gynecology.

EXISTING FEDERAL LAW. The Emergency Medical Treatment and Active Labor Act, (EMTALA) passed in 1986 as part of the Consolidated Omnibus Budget Reconciliation Act, requires hospitals that accept payments from Medicare to provide emergency health care treatment to anyone needing it regardless of citizenship, legal status, or ability to pay. There are no reimbursement provisions. Participating hospitals may not transfer or discharge patients needing emergency treatment except with the informed consent or stabilization of the patient or when their condition requires transfer to a hospital better equipped to administer the treatment. EMTALA applies to "participating hospitals." The statute defines participating hospitals as those that accept payment from CMS under the Medicare program. Because there are very few hospitals that do not accept Medicare, the law applies to nearly all hospitals.

FISCAL EFFECT: This bill has not been analyzed by a fiscal committee.

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, this bill will help preserve life-saving emergency care services at San Clemente’s SMMC. The author notes for over 40 years, this hospital has served as the only emergency care facility in the city of San Clemente and its neighboring communities, however, MemorialCare, the hospital’s owner, is considering plans to convert it into an ambulatory health care campus that would provide outpatient surgery and urgent care services. The author states this bill is intended to authorize SMMC to operate a stand-alone ER for purposes of stabilizing patients prior to transfer to any other hospital in the region.
   
   The author contends, without this bill, SMMC closure could force residents to travel 15 miles to reach the next closest ER, thus increasing mortality rates, which will have a tremendous impact on the community, especially given the fact that San Clemente has such a large population of children and elderly people who are most dependent on life-saving services. The author adds that underserved communities would also be adversely affected with limited access to affordable and quality healthcare.
   
2. BACKGROUND.
   
   1. SMMC. SMMC is a 325 bed non-profit hospital serving approximately 800,000 residents in south Orange County. It operates two acute campuses under a single consolidated license; the 252 bed Laguna Hills campus, and the 73 bed San Clemente campus. Saddleback is part of the non-profit MemorialCare Health System. Saddleback and MemorialCare have worked over the last decade to transform their services from an acute care hospital-centric delivery system, to a population health-based delivery system. They have made significant investments in chronic disease management infrastructure and care navigation personnel aimed at finding new and innovative ways to care for patients in non-acute care settings. A consequence of these efforts has been that their inpatient volumes have fallen. For the last decade, the average inpatient census was around 25. In recent years, the average census has dropped to below 14 on average, with many days below 10. These trends have created concerns regarding the acute care viability of the San Clemente campus. Thus, MemorialCare has proposed closing and demolishing the hospital, and building a new outpatient clinic with an urgent care center. The surrounding communities, concerned about access to emergency services, transport, and wait times, have created a coalition to try to keep the ED open, hence this bill.
      
   2. Freestanding EDs (FEDs). FEDs have existed for almost 40 years. They first emerged in the early 1970s as a result of the need for emergency care in rural or other underserved regions of the eastern United States. Some of the first FEDs have now expanded to become full hospitals, while others have remained freestanding facilities. There is no strict definition for FEDs, but they are generally a facility that provides emergency care but is separate from an acute care hospital. In recent years FEDs have opened in Florida, Illinois, Texas, and Washington. According to a 2009 California HealthCare Foundation (CHCF) report, "Freestanding EDs: Do They Have a Role In California?" the motivations for constructing FEDs most commonly include the following:
      
      1. Providing enhanced access to care and meet an increasing demand for emergency services;
         
      2. Developing sites and services that differentiate the organization from its competitors;
         
      3. Gaining increased market share;
         
      4. Providing a referral source for affiliated physicians;
         
      5. Increasing the potential for referring patients to hospital-based services; and,
         
      6. Increasing the potential for mitigating competitive threats.
         

The CHCF report also notes that no FEDs offer trauma services to severely injured patients, those cases are typically directed by EMS authorities to the nearest trauma center. FEDs are typically within 15 to 20 miles of a hospital. The report also goes on to note that because most FEDS do not receive EMS/911 transports, the majority of their patients walk into the FED and are lower-acuity patients.

• 1. EDs. Under existing law an ED is defined as the location in a hospital where emergency services are provided. All licensed general acute care hospitals are required to meet eight basic services. An ED is considered a special service, which requires additional approval from DPH. Historically, ED visits have driven hospital admissions. A 2013 RAND Corporation report, "The Evolving Role of Emergency Departments in the United States," notes that ERs account for about half of the nation’s hospital admissions and accounted for virtually the entire rise in admissions between 2003 and 2009. ED costs correspond to the severity of a patient’s illness or injury, the number of diagnostic tests and/or treatments performed, physicians’ fees (typically about 20% to 25% of the total charges), radiology or specialist services, and any pharmacy or other hospital expenses. For example, an ambulance ride alone can cost between $400 and $1,200, depending upon location, distance from the hospital and services performed. Costs vary widely in different parts of the country and ultimately depend upon who pays – the individual, a private health insurer, or a government agency like Medicare or Medicaid.
     
  2. Urgent care clinics. The definition of urgent care varies, but most facilities provide unscheduled care, after-hours access, expanded services compared to primary care, and a lower cost than emergency care. On-site X-ray, intravenous medications and fluids, repair of lacerations, foreign body removal, basic fracture care, and treatment of abscess are most common. According to a 2012 report published in the American Journal of Clinical Medicine, "Urgent Care Centers, an Overview," several sources have reported that the cost of care for comparable medical problems in urgent care, although slightly more than primary care, is usually between 10% and 33% of the cost of emergency care. Copays vary from zero to as much as $100. Usually they are less than $50.
     

1. SUPPORT. The City of San Clemente supports this bill, noting it does not propose changing the hospital and emergency structure throughout the state, but proposes a standalone ED solely for this unique geographic region in South Orange County. The City notes the hospital treats 15,000 ER patients per year, admits over 4,000 patients, and provides over 200 jobs. The City concludes, with a new 14,000 home development to the east of town well underway, the loss of the ER will impact not only the residents of San Clemente, but also the new families that will continue moving into this area for years to come.

The Orange County Fire Authority (OCFA) supports this bill, noting they have reviewed call data for the two emergency transport units in San Clemente. They state in 2014 there were 1,701 total transports of which 1,217 (72%) were transported to SMMC. OCFA contends that without an ER at this facility the OCFA would be required to transport patients to hospital further away and possibly delaying treatment.

Save Saddleback San Clemente Hospital is a coalition of concerned citizens in San Clemente supporting this bill. They note they are effectively a peninsula, with Camp Pendleton to the south, protected forest to the east, the ocean to the west, and only one road north, 1-5, with which to access emergency services. They also point out that an I-5 widening project has just started closing shoulders and ramps intermittently and that this project will last three years, potentially increasing transport times.

SMMC is in support of this bill because they desire to continue to serve the community's EMS needs, including continuing to receive paramedic traffic and seeing all emergent patients without regard for their ability to pay.

1. OPPOSITION. The California Chapter of the American College of Emergency Physicians (California ACEP) is opposed to this bill stating, freestanding EDs are facilities that provide urgent care, but are not attached to acute care hospitals. California ACEP notes, while the words ‘emergency department’ are in the title of these facilities, they operate like urgent care clinics; the very nature of an ED is that it is a department of a hospital, a place where patients have immediate access to a wide variety of treatment services and specialists when necessary to treat their serious conditions. California ACEP concludes, allowing urgent care facilities to contain the word emergency in the title poses safety risks to patients who arrive at the door assuming they can receive full-scope ED care.
   
   The California Labor Federation (CLF) opposes this bill because to be licensed in California for EMS, a facility must provide specialized urgent service onsite, including intensive care services, laboratory, radiology, surgical services, post-anesthesia recovery, and blood banks. CLF also notes the current law states that an ED is in a hospital licensed to provide emergency services, which indicates that an ED is required to be part of a health facility providing other support services. Finally, CLF states, this bill will undermine existing law and regulations governing the operation of ED by allowing a freestanding ED without appropriate regulation and oversight.
   
   The California Nurses Association (CNA) opposes this bill stating that SMMC is currently planning to convert its acute care hospital to outpatient services because of a purported lack of need for acute care hospital beds. CNA notes, when making the argument to the community for the need for the new outpatient service center, the hospital contends that the majority of patients treated in area ERs do not need to be seen in an ED; they could be seen in other high quality, convenient settings if they were available.

The California State Council of the Service Employees International Union (SEIU California) opposes this bill stating, in order to provide emergency services is California emergency service providers must be located within a hospital so as to have access to all necessary services including: intensive care, laboratory service, radiological services, surgical services, post-anesthesia recovery, and readily available services of a blood bank. SEIU California notes this bill proposes to reduce this list down to two services, laboratory and radiological, which causes grave concerns for patient safety. SEIU California contends it is difficult to predict the severity of the medical needs of patients presenting at an ED, and should an individual require immediate surgery to save their life, or need to be transferred into an intensive care unit for observations, those services should be as close and readily available to the patient as possible.

1. RELATED LEGISLATION.
   
   1. AB 579 (Obernolte) creates an exception to permit a general acute care hospital to operate an ED located more than 15 miles from its main physical plant, if all applicable requirements of licensure are satisfied. AB 579 also permits a closing general acute care hospitals' ED to continue to be operated at the same location or locations by an acquiring general acute care hospital, as specified. AB 579 creates an exception to permit the acquiring general acute care hospital to operate the closing general acute care hospitals' ED at that location or locations, even if located more than 15 miles from the acquiring general acute care hospital’s main physical plant, if all applicable requirements of licensure are satisfied. AB 579 is currently pending in the Assembly Health Committee.
      
   2. SB 787 (Bates) requires a general acute care hospital that provides EMS and that is scheduled for closure to conduct public hearings for public review and comment, as specified. SB 787 also authorizes SMMC, San Clemente, to continue, under its existing license, to provide EMS to patients in the region if it otherwise transforms its delivery of services. SB 787 is set for hearing in the Senate Health Committee on January 13, 2016.
2. PREVIOUS LEGISLATION.
   
   1. AB 717 (Gordon) of 2005 would have allowed the Centinela Airport Clinic to receive private and government reimbursement rates equivalent to that of a contiguous ED of a general acute care hospital if it meets certain specified requirements. AB 717 failed passage in the Senate Health Committee.
      
   2. AB 1050 (Gordon) of 2005, would have created a demonstration project that required the Department of Health Services (now DPH) to issue a special permit to up to four general acute care hospital applicants in Los Angeles County to operate freestanding emergency receiving centers. AB 1050 was never heard in Committee.
3. POLICY COMMENTS. Under current law, when two hospitals operate under a consolidated license, they share a governing body, but both facilities must meet all of the requirements of licensure. This bill appears to turn that premise on its head, and instead only requires the parent hospital to meet all licensure requirements, while allowing the FED to operate with reduced requirements. For example, this bill spells out certain services the FED would have to provide, such as laboratory and diagnostic radiology services, including X-ray, CT scan, and ultrasound capabilities, but remains silent on whether or not the FED would be able to provide basic required services such as surgical and dietary, or whether those services would be provided at the parent hospital. It is unclear if a FED could safely operate without the ability to provide those services onsite.
   

Another issue of concern is the potential for patient harm stemming from confusion over what differentiates an FED from ED. While both would be expected to address emergencies, FEDs appear to be much more like urgent care centers, which are typically designed to handle less serious illnesses and injuries, like a sprained ankle, a cut, or the flu. EDs are equipped to handle life-and-death matters like traumatic injuries, heart attacks, and strokes, as well as anything less severe. For example, an individual could experience shortness of breath, or a toothache, and drive themselves to the FED thinking they were having an asthma attack, or wanting pain medication for the toothache, when in fact they were experiencing a heart attack requiring immediate emergency surgery, which would not be available at SMMC.

Finally, it is of concern that as currently drafted, this bill would allow one hospital in the state to charge ED prices without meeting the requirements and responsibilities of full ED licensure, while only providing what is essentially urgent care service.

REGISTERED SUPPORT / OPPOSITION:

Support
Congressman Darrell Issa
City of Dana Point
City of San Clemente
Saddleback Memorial Medical Center
San Clemente Chamber of Commerce
Save Saddleback San Clemente Hospital
Orange County Fire Authority
Numerous individuals

Opposition
California Chapter of the American College of Emergency Physicians
California Labor Federation
California Nurses Association/National Nurses United
California State Council of the Service Employees International Union

Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097

Date of Hearing: April 28, 2015

ASSEMBLY COMMITTEE ON HEALTH

Rob Bonta, Chair

ABPCA Bill Id:AB 911

Author:(Brough) – As Amended Ver:April 14, 2015

SUBJECT: Hospitals: closures.

SUMMARY: Authorizes Saddleback Memorial Medical Center (SMMC) to operate an emergency department (ED) at its San Clemente campus after the hospital at that site is closed. Contains an urgency clause to ensure that the provisions of this bill go into immediate effect upon enactment. Specifically, this bill:

1. Allows SMMC to operate an ED at its San Clemente campus if the following requirements are met:

   1. The ED is operated under the consolidated license of SMMC and meets all of the requirements imposed under that license, including being within 15 miles of its parent hospital;

   2. The ED is converted from a previously existing acute care campus and not a newly developed freestanding ED;

   3. The ED is open 24 hours a day, 365 days a year;

   4. The ED is staffed with at least one board-certified emergency physician at all times;

   5. The ED is staffed with properly trained emergency room nurses and meets the minimum staffing requirements for EDs in this state;

   6. The ED has a complete range of laboratory and diagnostic radiology services, including a complete array of lab test, basic X-ray, computerized tomography (CT) scan, and ultrasound capabilities;

   7. The ED meets the specialty call requirements, as defined by the Orange County Emergency Medical Services Agency, under its consolidated license;

   8. The ED has transfer agreements with specialty centers, such as trauma, burn, and pediatric centers, to meet the needs of the injury or patient population served in the community; and,

   9. The ED has a fully functioning transport program with the capability to safely transport patients who require admission to its parent hospital or other higher level of care and specialty services facilities, such as trauma, burn, and pediatric facilities.

2. Requires all applicable federal and state regulatory requirements to be met under the consolidated license of SMMC, including all applicable regulations of the Centers for Medicare and Medicaid Services (CMS) and Title 22 of the California Code of Regulations.
   
   
   

3. Specifies that nothing in these provisions requires the hospital to provide for acute care services at the San Clemente Campus, or to seek additional licensure for operation of the ED.

EXISTING LAW:

1. Provides for the licensure and regulation of health facilities by the California Department of Public Health (DPH).

2. Defines a general acute care hospital as a health facility having a governing body with administrative and professional responsibility and organized medical staff that provides 24-hour care, including the following basic services: medical; nursing; surgical; anesthesia; laboratory; radiology; pharmacy; and, dietary.

3. Authorizes DPH to grant a special permit for a health facility to provide one or more special services, including emergency center services.

4. Defines an ED as being located in a hospital licensed to provide emergency medical services (EMS).

5. Requires DPH to issue a single consolidated license to a general acute care hospital that includes more than one physical plant maintained and operated on separate premises or that has multiple licenses for a single health facility on the same premises if the general acute care hospital meets certain criteria and applicable requirements of licensure.

EXISTING STATE REGULATIONS:

1. Define comprehensive EMS as the provision of diagnostic and therapeutic services for unforeseen physical and mental disorders which, if not promptly treated, would lead to marked suffering, disability, or death. The scope of services is comprehensive with in-house capabilities for managing all medical situations on a definitive and continuing basis.

2. Detail the requirements for providing comprehensive EMS which include, among other things:

   1. EMS are to be located in the hospital so as to have ready access to all necessary services;

   2. Comprehensive EMS are to be identified to the public by an exterior sign, clearly visible form public thoroughfares which states: COMPREHENSIVE EMERGENCY MEDICAL SERVICE PHYSICIAN ON DUTY;

   3. Requiring radiological services, clinical laboratory services, and surgical services to be immediately available for life-threatening situations.

3. Detail the requirements for comprehensive emergency medical service staff which includes:

   1. A full-time physician trained and experienced in emergency medicine;

   2. Provides continuous staffing with physicians trained and experienced in emergency medical service, and requires such physicians to be assigned to and be located in the emergency service area 24 hours a day; and,

   3. Provides experienced physicians in specialty categories to be available in-house 24 hours a day, including such specialties as medicine, surgery, anesthesiology, orthopedics, neurosurgery, pediatrics, and obstetrics-gynecology.

EXISTING FEDERAL LAW. The Emergency Medical Treatment and Active Labor Act, (EMTALA) was passed in 1986 as part of the Consolidated Omnibus Budget Reconciliation Act. It requires hospitals that accept payments from Medicare to provide emergency health care treatment to anyone needing it regardless of citizenship, legal status, or ability to pay. There are no reimbursement provisions. Participating hospitals may not transfer or discharge patients needing emergency treatment except with the informed consent or stabilization of the patient or when their condition requires transfer to a hospital better equipped to administer the treatment. EMTALA applies to "participating hospitals." The statute defines participating hospitals as those that accept payment from CMS under the Medicare program. Because there are very few hospitals that do not accept Medicare, the law applies to nearly all hospitals.

FISCAL EFFECT: This bill has not been analyzed by a fiscal committee.

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, this bill will help preserve life-saving emergency care services at San Clemente’s SMMC. The author notes for over 40 years, this hospital has served as the only emergency care facility in the city of San Clemente and its neighboring communities, however, MemorialCare, the hospital’s owner, is considering plans to convert it into an ambulatory health care campus that would provide outpatient surgery and urgent care services. The author states this bill is intended to authorize SMMC to operate a stand-alone emergency room for purposes of stabilizing patients prior to transfer to any other hospital in the region.
   
   The author contends, without this legislation, this hospital closure could force residents to travel 15 miles to reach the next closest emergency room thus increasing mortality rates, which will have a tremendous impact on the community, especially given the fact that San Clemente has such a large population of children and elderly people who are most dependent on life-saving services. The author adds that underserved communities would also be adversely affected with limited access to affordable and quality healthcare.
   
   

2. BACKGROUND.
   
   

   1. SMMC. SMMC is a 325 bed non-profit hospital serving approximately 800,000 residents in south Orange County. It operates two acute campuses under a single consolidated license; the 252 bed Laguna Hills campus, and the 73 bed San Clemente campus. Saddleback is part of the non-profit MemorialCare Health System. Saddleback and MemorialCare have worked over the last decade to transform their services from an acute care hospital-centric delivery system, to a population health-based delivery system. They have made significant investments in chronic disease management infrastructure and care navigation personnel aimed at finding new and innovative ways to care for patients in non-acute care settings. A consequence of these efforts has been that their inpatient volumes have fallen. For the last decade, the average inpatient census was around 25. In recent years, the average census has dropped to below 14 on average, with many days below 10. These trends have created concerns regarding the acute care viability of the San Clemente campus. Thus, MemorialCare has proposed closing and demolishing the hospital, and building and new outpatient clinic with an urgent care center. The surrounding communities, concerned about access to emergency services, transport and wait times, have created a coalition to try to keep the ED open, hence this bill.
      
      

   2. Freestanding EDs (FEDs). FEDs have existed for almost 40 years. They first emerged in the early 1970s as a result of the need for emergency care in rural or other underserved regions of the eastern United States. Some of the first FEDs have now expanded to become full hospitals, while others have remained freestanding facilities. There is no strict definition for FEDS, but they are generally a facility that provides emergency care but is separate from an acute care hospital. In recent years FEDs have opened in Florida, Illinois, Texas, and Washington. According to a 2009 California Healthcare Foundation report, "Freestanding EDs: Do They Have a Role In California?" the motivations for constructing FEDs most commonly include the following:
      
      

      1. Providing enhanced access to care and meet an increasing demand for emergency services;
         
         

      2. Developing sites and services that differentiate the organization from its competitors;
         
         

      3. Gaining increased market share;
         
         

      4. Providing a referral source for affiliated physicians;
         
         

      5. Increasing the potential for referring patients to hospital-based services; and,
         
         

      6. Increasing the potential for mitigating competitive threats.
         
         

The California HealthCare Foundation (CHCF) report also notes that no FEDs offer trauma services to severely injured patients, those cases are typically directed by EMS authorities to the nearest trauma center. FEDs are typically within 15 to 20 miles of a hospital. The report also goes on to note that because most FEDS do not receive EMS/911 transports, the majority of their patients walk into the FED and are lower-acuity patients.

3. EDs. Under existing law an ED is defined as the location in a hospital where emergency services are provided. All licensed general acute care hospitals are required to meet eight basic services. An ED is considered a special service, which requires additional approval from DPH. Historically, ED visits have driven hospital admissions. A 2013 RAND Corporation report, "The Evolving Role of Emergency Departments in the United States," notes that emergency rooms account for about half of the nation’s hospital admissions and accounted for virtually the entire rise in admissions between 2003 and 2009. ED costs correspond to the severity of a patient’s illness or injury, the number of diagnostic tests and/or treatments performed, physicians’ fees (typically about 20% to25% of the total charges), radiology or specialist services, and any pharmacy or other hospital expenses. For example, an ambulance ride alone can cost between $400 and $1,200, depending upon location, distance from the hospital and services performed. Costs vary widely in different parts of the country and ultimately depend upon who pays – the individual, a private health insurer, or a government agency like Medicare or Medicaid.
   
   

4. Urgent care clinics. The definition of urgent care varies, but most facilities provide unscheduled care, after-hours access, expanded services compared to primary care, and a lower cost than emergency care. On-site X-ray, intravenous medications and fluids, repair of lacerations, foreign body removal, basic fracture care, and treatment of abscess are most common. According to a 2012 report published in the American Journal of Clinical Medicine, "Urgent Care Centers, an Overview," several sources have reported that the cost of care for comparable medical problems in urgent care, although slightly more than primary care, is usually between 10% and 33% of the cost of emergency care. Copays vary from zero to as much as $100. Usually they are less than $50.
   
   

1. SUPPORT. The San Clemente City Council supports this bill, noting it does not propose changing the hospital and emergency structure throughout the state, but proposes a standalone ED solely for this unique geographic region in South Orange County. The City Council states there are two main concerns with the potential loss of the emergency room: a) financial impact; and, b) health impact. They note that fiscally, the city's public safety costs would increase, thus costing taxpayer more as local paramedics would have to deploy out of town onto the already congested I-5 freeway on all 911 calls, making ambulances and their firefighter operators less available in town. The City Council continues, as for the health impacts, these would be critical to those in need should the ED close as it currently treats 15,000 ED patients per year and admits over 4,000 patients per year.
   
   The Orange County Fire Authority (OCFA) supports this bill, noting they have reviewed call data for the two emergency transport units in San Clemente. They state in 2014 there were 1,701 total transports of which 1,217 (72%) were transported to SMMC. OCFA contends that without an emergency room at this facility the OCFA would be required to transport patients to hospital further away and possibly delaying treatment.
   
   Save Saddleback San Clemente Hospital is coalition of concerned citizens' in San Clemente supporting this bill. They note they are effectively a peninsula, with Camp Pendleton to the south, protected forest to the east, the ocean to the west, and only one road north, 1-5, with which to access emergency services. They also point out that an I-5 widening project has just started closing shoulders and ramps intermittently and that this project will last three years, potentially increasing transport times.
   
   SMMC is in support of this bill because they desire to continue to serve the community's EMS needs, including continuing to receive paramedic traffic and seeing all emergent patients without regard for their ability to pay.
   
   

2. OPPOSITION. The California Chapter of the American College of Emergency Physicians (California ACEP) is opposed to this bill stating, freestanding EDs are facilities that provide urgent care, but are not attached to acute care hospitals. California ACEP notes, while the words ‘emergency department’ are in the title of these facilities, they operate like urgent care clinics; the very nature of an ED is that it is a department of a hospital, a place where patients have immediate access to a wide variety of treatment services and specialists when necessary to treat their serious conditions. California ACEP concludes, allowing urgent care facilities to contain the word emergency in the title poses safety risks to patients who arrive at the door assuming they can receive full-scope ED care.
   
   The California Labor Federation (CLF) is opposed to this bill because to be licensed in California for EMS, a facility must provide specialized urgent service onsite, including intensive care services, laboratory, radiology, surgical services, post-anesthesia recovery, and blood banks. CLF also notes the current law states that an ED is in a hospital licensed to provide emergency services, which indicates that an ED is required to be part of a health facility providing other support services. Finally, CLF states, this bill will undermine existing law and regulations governing the operation of ED by allowing a freestanding ED without appropriate regulation and oversight.
   
   The California Nurses Association is opposed to this bill stating that SMMC is currently planning to convert its acute care hospital to outpatient services because of a purported lack of need for acute care hospital beds, and when making the argument to the community for the need for the new outpatient service center, the hospital makes the following argument against the need for an ED:

The majority of patients treated in area emergency rooms do not need to be seen in an ED; they could be seen in other high quality, convenient settings if they were available. EDs are the most expensive places to receive care, and we hear this from many of our patients. In the six hospitals in the Memorial Care health System, more than half of all patients are treated for relatively simple conditions such as ear infections, laceration repairs, and minor orthopedic injuries. Even a high percentage of ambulance transports are not life or limb threatening. EMS systems throught the state are aware of this and are seeking ways to help reduce the pressure of non-emergency traffic. That is why Orange County EMS and the local fire authority are participating in a statewide pilot study, exploring ways to contract with selected urgent care centers to be able to receive ambulance traffic.

The California State Council of the Service Employees International Union (SEIU California) opposes this bill stating, in order to provide emergency services is California emergency service providers must be located within a hospital so as to have access to all necessary services including: intensive care, laboratory service, radiological services, surgical services, post-anesthesia recovery, and readily available services of a blood bank. SEIU California notes this bill proposes to reduce this list down to two services, laboratory and radiological, which causes grave concerns for patient safety. SEIU contends it is difficult to predict the severity of the medical needs of patients presenting at an ED, and should an individual require immediate surgery to save their life, or need to be transferred into an intensive care unit for observations, those services should be as close and readily available to the patient as possible.

5. RELATED LEGISLATION.
   
   

   1. AB 579 (Obernolte) creates an exception to permit a general acute care hospital to operate an ED located more than 15 miles from its main physical plant, if all applicable requirements of licensure are satisfied. The bill would also permit a closing general acute care hospitals' ED to continue to be operated at the same location or locations by an acquiring general acute care hospital, as specified. AB 579 creates an exception to permit the acquiring general acute care hospital to operate the closing general acute care hospitals' ED at that location or locations, even if located more than 15 miles from the acquiring general acute care hospital’s main physical plant, if all applicable requirements of licensure are satisfied. AB 579 is currently pending in Assembly Health Committee.
      
      

   2. SB 787 (Bates) requires a general acute care hospital that provides EMS and that is scheduled for closure to conduct public hearings for public review and comment, as specified. SB 787 would also authorize SMMC, San Clemente, to continue, under its existing license, to provide EMS to patients in the region if it otherwise transforms its delivery of services. SB 787 is pending in the Senate Health.
      
      

6. PREVIOUS LEGISLATION.
   
   

   1. AB 717 (Gordon) of 2005 would have allowed the Centinela Airport Clinic to receive private and government reimbursement rates equivalent to that of a contiguous ED of a general acute care hospital if it meets certain specified requirements. AB 717 failed passage in the Senate Health Committee.
      
      

   2. AB 1050 (Gordon) of 2005, would have created a demonstration project that required the Department of Health Services (now DPH) to issue a special permit to up to four general acute care hospital applicants in Los Angeles County to operate freestanding emergency receiving centers. AB 1050 was never heard in Committee.

7. POLICY COMMENTS. Under current law, when two hospitals operate under a consolidated license, they share a governing body, but both facilities must meet all of the requirements of licensure. This bill appears to turn that premise on its head, and instead only require the parent hospital to meet all licensure requirements, while allowing the FED to operate with reduced requirements. For example, the bill spells out certain services the FED would have to provide, such as laboratory and diagnostic radiology services, including X-ray, CT scan, and ultrasound capabilities, but remains silent on whether or not the FED would be able to provide basic required services such as surgical and dietary, or whether those services would be provided at the parent hospital. It is unclear if a FED could safely operate without the ability to provide those services on site.
   
   

Another issue of concern is the potential for patient confusion over what differentiates an FED from ED. While both would be expected to address emergencies, FEDs appear to be much more like urgent care centers, which are typically designed to handle less serious illnesses and injuries, like a sprained ankle, a cut, or the flu. EDs are equipped to handle life-and-death matters like traumatic injuries, heart attacks, and strokes, as well as anything less severe. For example, an individual could experience shortness of breath, or a toothache, and drive themselves to the FED thinking they were having an asthma attack, or wanting pain medication for the toothache, when in fact they were experiencing a heart attack requiring immediate emergency surgery, which would not be available at SMMC.

Finally, it is of concern that as currently drafted, this bill would allow one hospital in the state to charge ED prices without the meeting the requirements and responsibilities of full ED licensure, while only providing what is essentially urgent care service.

REGISTERED SUPPORT / OPPOSITION:

Support

City of Dana Point
Saddleback Memorial Hospital
San Clemente City Council
Save Saddleback San Clemente Hospital
Orange County Fire Authority
Numerous individuals

Opposition

California Chapter of the American College of Emergency Physicians
California Labor Federation
California Nurses Association
SEIU California

Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097