Under existing law, the Emergency Medical Air Transportation Act, a penalty of $4 is imposed upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense. Existing law requires the county or the court that imposed the fine to transfer the moneys collected pursuant to this act to the Emergency Medical Air Transportation Act Fund. Under existing law, the assessment of these penalties will terminate on January 1, 2016, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2017, will transfer to the General Fund. Existing law repeals the Emergency Medical Air Transportation Act on January 1, 2018.

This bill would extend the dates of the Emergency Medical Air Transportation Act, so that the assessment of the penalties will terminate commencing January 1, 2018, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2019, will transfer to the General Fund. The bill would extend the operation of the Emergency Medical Air Transportation Act until January 1, 2020.

The bill would also make legislative findings and declarations as to the harmful effects of relying on penalty assessments to fund core state programs and the necessity to identify alternative funding sources for emergency medical air transportation services. The bill would require the State Department of Health Care Services and the Department of Finance to develop, by March 1, 2017, a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the expiration of the Emergency Medical Air Transportation Act on January 1, 2020.

Under existing law, the Emergency Medical Air Transportation Act, a penalty of $4 is imposed upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense. Existing law requires the county or the court that imposed the fine to transfer the moneys collected pursuant to this act to the Emergency Medical Air Transportation Act Fund. Under existing law, the assessment of these penalties will terminate on January 1, 2016, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2017, will transfer to the General Fund. Existing law repeals the Emergency Medical Air Transportation Act on January 1, 2018.

This bill would extend the dates of the Emergency Medical Air Transportation Act, so that the assessment of the penalties will terminate commencing January 1, 2018, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2019, will transfer to the General Fund. The bill would extend the operation of the Emergency Medical Air Transportation Act until January 1, 2020.

The bill would also make legislative findings and declarations as to the harmful effects of relying on penalty assessments to fund core state programs and the necessity to identify alternative funding sources for emergency medical air transportation services. The bill would require the State Department of Health Care Services and the Department of Finance to develop, by March 1, 2017, a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the expiration of the Emergency Medical Air Transportation Act on January 1, 2020.

Under existing law, the Emergency Medical Air Transportation Act, a penalty of $4 is imposed upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense. Existing law requires the county or the court that imposed the fine to transfer the moneys collected pursuant to this act to the Emergency Medical Air Transportation Act Fund. Under existing law, the assessment of these penalties will terminate on January 1, 2016, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2017, will transfer to the General Fund. Existing law repeals the Emergency Medical Air Transportation Act on January 1, 2018.

This bill would extend the dates of the Emergency Medical Air Transportation Act, so that the assessment of the penalties will terminate commencing January 1, 2018, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2019, will transfer to the General Fund. The bill would repeal extend the operation of the Emergency Medical Air Transportation Act on until January 1, 2020.

Under existing law, the Emergency Medical Air Transportation Act, a penalty of $4 is imposed upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense. Existing law requires the county or the court that imposed the fine to transfer the moneys collected pursuant to this act to the Emergency Medical Air Transportation Act Fund. Under existing law, the assessment of these penalties will terminate commencing on January 1, 2016, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2017, will transfer to the General Fund. Existing law repeals the Emergency Medical Air Transportation Act on January 1, 2018.

Under existing law, the Emergency Medical Air Transportation Act, a penalty of $4 is imposed upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense. Existing law requires the county or the court that imposed the fine to transfer the moneys collected pursuant to this act to the Emergency Medical Air Transportation Act Fund. Under existing law, the assessment of these penalties will terminate commencing January 1, 2016, and any moneys unexpended and unencumbered in the Emergency Medical Air Transportation Act Fund on June 30, 2017, will transfer to the General Fund. Existing law repeals the Emergency Medical Air Transportation Act on January 1, 2018.

This bill would delete the repeal of the Emergency Medical Air Transportation Act, thereby extending its operation indefinitely. The bill would make conforming changes to extend the assessment of penalties pursuant to the act, and would delete the provision for transfer of residual moneys to the General Fund.

 UNFINISHED BUSINESS  

Bill No: SB 326

Author: Beall (D), et al.

Amended: 8/31/15

Vote: 21

SENATE HEALTH COMMITTEE: 8-0, 4/8/15

AYES: Hernandez, Hall, Mitchell, Monning, Nielsen, Pan, Roth, Wolk

NO VOTE RECORDED: Nguyen

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/28/15

AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

SENATE FLOOR: 31-5, 6/3/15

AYES: Allen, Bates, Beall, Berryhill, Block, Cannella, De León, Galgiani, Glazer, Hall, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Nielsen, Pan, Pavley, Roth, Vidak, Wieckowski, Wolk

NOES: Anderson, Moorlach, Morrell, Nguyen, Stone

NO VOTE RECORDED: Fuller, Gaines, Hancock, Runner

ASSEMBLY FLOOR: 74-0, 9/10/15 - See last page for vote

SUBJECT: Courts: penalties: emergency services funding

SOURCE: California Association of Air Medical Services

DIGEST: This bill extends the sunset date of the $4 penalty assessment for Vehicle Code violations other than parking offenses, until January 1, 2018, with the resulting revenue deposited in the Emergency Medical Air Transportation Act Fund (Fund). Money in that Fund is primarily used to fund Medi-Cal reimbursement for emergency medical air transportation services. Requires the Department of Health Care Services to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of penalty assessments under this bill on January 1, 2018.

Assembly Amendments require DHCS, by March 1, 2017, in coordination with the Department of Finance, to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of penalty assessments under this bill on January 1, 2018, and make legislative findings and declarations as to the harmful effects of relying on penalty assessments to fund core state programs and the necessity to identify alternative funding sources for emergency medical air transportation services.

ANALYSIS:

Existing law:

1. Levies, under the Emergency Medical Air Transportation Act (Act), a penalty of $4 upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense.
   
   

2. Sunsets the assessment of the $4 penalty under the Act commencing January 1, 2016, and transfers any moneys unexpended and unencumbered in the Fund on June 30, 2017, to the General Fund.
   
   

3. Requires the county or the court that imposed the fine to transfer the moneys collected to the Fund.
   
   

4. Requires moneys in the Fund to be made available, upon appropriation by the Legislature, to the Department of Health Care Services (DHCS), to be for payment of DHCS administrative costs, with the remainder being used as follows:

1. Twenty percent to offset the state portion of the Medi-Cal reimbursement rate for emergency medical air transportation services; and,

2. Eighty percent to augment emergency medical air transportation reimbursement payments made through the Medi-Cal program.

5. Requires DHCS to seek to obtain federal matching funds by using the moneys in the Fund for the purpose of augmenting Medi-Cal reimbursement paid to emergency medical air transportation providers.
   
   

6. Repeals the section of law establishing the Act, the Fund, and the Medi-Cal emergency medical air transportation reimbursement provisions on January 1, 2018.

This bill:

1. Extends the sunset date of the $4 penalty assessment established under the Act, from January 1, 2016 to January 1, 2018.

2. Extends the January 1, 2018 sunset date of the Act to January 1, 2020, and makes related changes.

3. Requires DHCS, by March 1, 2017, in coordination with the Department of Finance, to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of penalty assessments under this bill on January 1, 2018.

4. Make legislative findings and declarations as to the harmful effects of relying on penalty assessments to fund core state programs and the necessity to identify alternative funding sources for emergency medical air transportation services.

Background

AB 2173 (Beall, Chapter 547, Statutes of 2010), levied a $4 additional penalty on Vehicle Code violations (excluding parking tickets), with the resulting revenue being used as the state match to draw down additional federal Medicaid matching funds to fund Medi-Cal emergency air medical transportation services. Between $11.2 and $13.7 million has been raised annually from the AB 2173 penalty assessment. Of that amount, $2.2 to $2.7 million is used as the state match to fund current emergency air ambulance Medi-Cal provider rates. The remaining $9 to $11 million is used to match with federal dollars to augment Medi-Cal rates to emergency air ambulance providers. The $9 to $11 million augmentation amounts from AB 2173 are provided as supplemental payments to eligible Medi-Cal air medical transportation providers that provide fee-for-service emergency air medical transportation services. Approximately 23 air ambulance providers receive the resulting revenue.

1. Penalty Assessments. According to the Judicial Council, the calculation for a traffic ticket in California, and determining where the money goes once collected, is complex. The cost of a traffic ticket includes a base fine amount plus penalty assessments and fees to fund specific state and local activities. The base fine is collected for, and distributed to, either the local government or local government and county. The increase in the total cost of a traffic ticket (above the base fine) in California over the last 20 years is primarily the result of the addition of mandatory penalty assessments and fees.

Penalty assessments are typically calculated from the base fine for the traffic ticket and are part of the punishment that is imposed for the violation. The penalties collected are distributed to many different city, county, and state funds established by the local government and Legislature for activities such as DNA collection in criminal cases, emergency medical services, local criminal justice facilities, emergency medical air transportation, and court facility maintenance and construction. The chart below lists three examples of the cost and distribution of a typical traffic ticket, including the base fine, penalties, and fees. The chart below, created by the Judicial Council, provides information on a typical ticket for faulty equipment ($25), a moving violation ($35), and driving more than 25 MPH over the speed limit ($100).

Comments

Author’s statement. According to the author, “[M]any emergency patients transported by air ambulances have no insurance, are not eligible for Medi-Cal, and have no ability to pay for the service, yet these patients are given the same high level of care as those with medical insurance. The Medi-Cal fee schedule pays air ambulance services far below the cost of providing emergency air transportation, and pays nothing if the patient is indigent. Emergency air ambulance services provide coverage to multiple counties within a 100-mile radius of their bases, and as a result often their transports originate in a county other than where they are based. This makes it difficult for them to be funded by local tax support except in the largest of counties. Emergency physicians and air ambulances do not receive additional funding through the Disproportionate Share Hospital (DSH) program, or the county Maddy Emergency Medical Services Fund when they provide treatment to indigent patients. Prior to enactment of the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to these services and will prevent funding for air ambulances from reverting back to 1993 levels by continuing the $4 penalty to fund air ambulance services.”

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Assembly Appropriations Committee:

1. Penalty revenues of around $10 million per year for an additional two years, until 2018 (Emergency Medical Air Transportation Act Fund). Annual revenues will fluctuate depending on the number of Vehicle Code violations that result in convictions, as well as other factors. The numbers below are based on an assumption of $10 million in annual revenue.

2. Administrative costs, likely in the low hundreds of thousands (Emergency Medical Air Transportation Act Fund).

3. Reduced GF expenditures of around $2 million per year for Medi-Cal payments, by using penalty revenues to offset GF expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

4. Annual expenditures of around $16 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds).

SUPPORT: (Verified 9/8/15)

California Association of Air Medical Services (source)

Board for Critical Care Transport Paramedic Certification

California Ambulance Association

California Children’s Hospital Association

California Hospital Association

CALSTAR

Care Flight

Children’s Hospital Los Angeles

Emergency Nurse Association

Hall Ambulance Service, Inc.

Helinet Aviation Services

Loma Linda Children’s Hospital

Manteca District Ambulance Service

Mercy Air Services

Mercy Medical Center Redding

PHI Air Medical

REACH Air Medical Services

Rural County Representatives of California

Sonora Regional Medical Center

Stanford Life Flight

OPPOSITION: (Verified 9/8/15)

None received

ARGUMENTS IN SUPPORT: This bill is sponsored by the California Association of Air Medical Services (Cal-AAMS), which argues this bill will maintain the current level of Medi-Cal funding of emergency air ambulance transportation by removing the sunset clause on the Act created in 2010. Cal-AAMSS states air ambulance services provide life-saving emergency transportation to the most critical patients from automobile accident scenes directly to trauma centers. In addition, emergency helicopter air ambulance providers provide a critical link between rural areas and urban tertiary care hospitals (trauma centers, heart/stroke centers, burn units) and are an essential part of the statewide emergency medical services system. Prior to the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to this essential life-saving service, and will prevent funding for air ambulances to revert back to 1993 levels. Removing the sunset for this penalty will ensure the program continues to support these critical services.

The Rural County Representatives of California (RCRC) write in support that air ambulance service is critical in rural and remote areas of California and a healthy air ambulance system ensures rural communities have access to life-saving care for both residents and tourists. RCRC states its member counties have had no issues in their administrative role in administering the penalty assessment, and they believe the Act should be continued in order to promote a vital health care delivery system that is so important in rural and remote areas.

ASSEMBLY FLOOR: 74-0, 9/10/15

AYES: Achadjian, Alejo, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Travis Allen, Hadley, Harper, Linder, Obernolte, Wagner

Prepared by: Scott Bain / HEALTH /

9/10/15 23:27:59

**** END ****

SENATE THIRD READING

STR Bill Id:SB 326

Author:(Beall)

As Amended Ver:August 31, 2015

Majority vote

SENATE VOTE: 31-5

SUMMARY: Extends the sunset date of the $4 penalty assessment for Vehicle Code violations, other than parking offenses, from January 1, 2016, to January 1, 2018, and extends the resulting revenue be deposited in the Emergency Medical Air Transportation Act (EMATA) Fund from June 30, 2017, to June 30, 2019. States it is the intent of the Legislature to cease collection of penalty assessments on January 1, 2018, pursuant to EMATA and that the Legislature identify alternative funding sources for emergency medical air transportation and cease reliance on penalty assessment revenue. Requires the Department of Health Care Services, in coordination with the Department of Finance, to develop a funding plan that ensures adequate reimbursement to emergency medical air transportation providers following the termination of the Vehicle Code penalty assessments.

FISCAL EFFECT: According to the Assembly Appropriations Committee:

1. Penalty revenues of around $10 million per year for an additional two years, until 2018 (EMATA Fund). Annual revenues will fluctuate depending on the number of vehicle code violations that result in convictions, as well as other factors. The numbers below are based on an assumption of $10 million in annual revenue.

2. Administrative costs, likely in the low hundreds of thousands (EMATA Fund).

3. Reduced General Fund (GF) expenditures of around $2 million per year for Medi-Cal payments, by using penalty revenues to offset GF expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

4. Annual expenditures of around $16 million per year for supplemental payments to private emergency air medical service providers (EMATA Fund and federal funds).

5. Based on language stating intent to cease collection of assessments for its current purpose and requiring a plan for an alternate funding source for emergency medical air transportation services, potential GF cost pressure to augment GF spending on these services.

COMMENTS: According to the author, many emergency patients transported by air ambulances have no insurance, are not eligible for Medi-Cal, and have no ability to pay for the service, yet these patients are given the same high level of care as those with medical insurance. The Medi-Cal fee schedule pays air ambulance services far below the cost of providing emergency air transportation, and pays nothing if the patient is indigent. Emergency air ambulance services provide coverage to multiple counties within a 100-mile radius of their bases, and as a result often their transports originate in a county other than where they are based. This makes it difficult for them to be funded by local tax support except in the largest of counties. Emergency physicians and air ambulances do not receive additional funding through the Disproportionate Share Hospital program or the county Maddy Emergency Medical Services (EMS) Fund when they provide treatment to indigent patients. Prior to enactment of EMATA, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to these services and will prevent funding for air ambulances from reverting back to 1993 levels by continuing the $4 penalty to fund air ambulance services.

AB 2173 (Beall), Chapter 547, Statutes of 2010, levied a $4 additional penalty on Vehicle Code violations (excluding parking tickets), with the resulting revenue being used as the state match to draw down additional federal Medicaid matching funds to fund Medi-Cal emergency air medical transportation services. Between $11.2 million and $13.7 million has been raised annually from the AB 2173 penalty assessment. Of that amount, $2.2 million to $2.7 million is used as the state match to fund current emergency air ambulance Medi-Cal provider rates. The remaining $9 million to $11 million is used to match with federal dollars to augment Medi-Cal rates to emergency air ambulance providers.

According to the Judicial Council, the calculation for a traffic ticket in California, and determining where the money goes once collected, is complex. The cost of a traffic ticket includes a base fine amount plus penalty assessments and fees to fund specific state and local activities. The base fine is collected for, and distributed to, either the local government or local government and county. The increase in the total cost of a traffic ticket (above the base fine) in California over the last 20 years is primarily the result of the addition of mandatory penalty assessments and fees.

This bill is sponsored by the California Association of Air Medical Services (Cal-AAMS), which argues this bill will maintain the current level of Medi-Cal funding of emergency air ambulance transportation by extending the sunset clause on the EMATA created in 2010. Cal-AAMSS states air ambulance services provide life-saving emergency transportation to the most critical patients from automobile accident scenes directly to trauma centers.

The Rural County Representatives of California (RCRC) states in support that air ambulance service is critical in rural and remote areas of California and a healthy air ambulance system ensures rural communities have access to life-saving care for both residents and tourists. RCRC states its member counties have had no issues in their administrative role in administering the penalty assessment, and they believe the EMATA should be continued in order to promote a vital health care delivery system that is so important in rural and remote areas.

The California Ambulance Association, also in support, notes that ambulance service, including air ambulance, is critical to the health care safety net, providing desperately needed care immediately to all people without exception. Emergency ambulance service providers are legally and morally bound to provide emergency services regardless of a patient’s ability to pay. The funds collected under EMATA are needed for better state funding of air ambulance activities.

There is no known opposition to this bill.

Analysis Prepared by: Patty Rodgers / HEALTH / (916) 319-2097 FN: 0001744

Date of Hearing: July 8, 2015

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Jimmy Gomez, Chair

SBPCA Bill Id:SB 326

Author:(Beall) – As Amended Ver:June 2, 2015

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill extends the sunset date of the $4 penalty assessment for Vehicle Code violations, other than parking offenses, and related funding provisions, from January 1, 2016 to January 1, 2018, to continue raising revenues to augment funding for emergency medical air transportation Medi-Cal providers.

FISCAL EFFECT:

1. Penalty revenues of around $10 million per year for an additional two years, until 2018 (Emergency Medical Air Transportation Act Fund). Annual revenues will fluctuate depending on the number of vehicle code violations that result in convictions, as well as other factors. The numbers below are based on an assumption of $10 million in annual revenue.

2. Administrative costs, likely in the low hundreds of thousands (Emergency Medical Air Transportation Act Fund).

3. Reduced GF expenditures of around $2 million per year for Medi-Cal payments, by using penalty revenues to offset GF expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

4. Annual expenditures of around $16 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds).

COMMENTS:

1. Purpose. This bill is intended to continue a funding augmentation for emergency medical air transportation that expires January 1, 2016.

2. Background. AB 2173 (Beall), Chapter 547, Statutes of 2010 (Emergency Medical Air Transportation Act), imposed an additional penalty of $4 upon every conviction involving a vehicle violation, except certain parking offenses, effective January 1, 2011. The bill required the county or court that imposed the fine to transfer the money to the Treasurer for deposit into the Emergency Air Medical Transportation Act (EMATA) Fund. After payment of the Department of Health Care Services’s administrative costs, 20% of the remaining EMATA funds are used to offset the State’s portion of the Medi­Cal reimbursement rate for emergency medical air transportation services. The remaining 80% of the fund is matched with federal funds and used to augment funding for air medical transportation by providing supplemental payments.

3. Penalty Assessments. In recent years, there has been increasing concern about the ever-growing burden of additional penalties, fines, and assessments applied to criminal and traffic convictions. The $4 penalty assessment that is the subject of this bill is one of numerous penalty assessments placed on traffic fines. Currently, a $100 traffic ticket becomes more than $500 when all the various assessments are included. In their analysis of this bill, the Department of Finance notes their concern with "traffic penalties as a funding mechanism for state programs, because these penalties place a financial burden on a narrow class of citizens for the costs of programs that should be properly borne by the public at large." The Lawyers' Committee for Civil Rights of the San Francisco Bay Area released a report in April 2015 titled "Not Just a Ferguson Problem: How Traffic Courts Drive Inequality in California" that recommends reforms to mitigate the harsh impact of traffic fines on low-income people, including reducing the burden of "exorbitant fines, fees, and assessments." The report points out that these fees perpetuate a cycle of poverty and inequality, given that low-income people are more likely to miss payments. When payments are missed, the report notes it results in a cycle of increasing fines and penalties, often culminating in suspension of drivers' licenses or even jail time for failure to pay, with concomitant poor labor market and social outcomes for these individuals.

4. Related Legislation.

   1. SB 85 (Committee on Budget and Fiscal Review), the public safety trailer bill of the 2015-16 budget, creates an amnesty program for fines and bail initially due on or before January 1, 2013, to be conducted in accordance with guidelines adopted by the Judicial Council. It also authorizes a low-income amnesty program participant to receive an additional reduction in his or her repayment amount. SB 85 is enrolled and pending action by the Governor.

   2. SB 405 (Hertzberg), in prior versions, contained many of the amnesty provisions that came to be included in SB 85. The amnesty provisions were amended out June 24, 2015, and the bill was amended to address a defendant's right to receive a court hearing or request an assessment be vacated. SB 405 is currently pending in the Assembly Transportation Committee.

5. Staff Comment. Although the $4 fee in this bill is a small percentage of the total amount of penalty assessments and surcharges, it is worth noting significant unintended consequences of the cumulative effect of these additional financial penalties for traffic and criminal violations.

Analysis Prepared by: Lisa Murawski / APPR. / (916) 319-2081

Date of Hearing: June 30, 2015

ASSEMBLY COMMITTEE ON HEALTH

Rob Bonta, Chair

SBPCA Bill Id:SB 326

Author:(Beall) – As Amended Ver:June 2, 2015

SENATE VOTE: 31-5

SUBJECT: Courts: penalties: emergency services funding.

SUMMARY: Extends the sunset date of the $4 penalty assessment for Vehicle Code violations, other than parking offenses, from January 1, 2016 to January 1, 2018, and extends the resulting revenue be deposited in the Emergency Medical Air Transportation Act (EMATA) Fund from June 30, 2017 to June 30, 2019. Extends the January 1, 2018 sunset date of the Act to January 1, 2020, and makes related changes. Money in the EMATA Fund is to be primarily used to augment Medi-Cal reimbursement for emergency medical air transportation services.

EXISTING LAW:

1. Levies, under EMATA, a penalty of $4 on every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, with the exception of a parking offense.
   
   

2. Sunsets assessment of the $4 penalty under EMATA on January 1, 2016, and transfers any monies unexpended and unencumbered in the EMATA Fund on June 30, 2017 to the General Fund.
   
   

3. Requires the county or the court that imposed the fine to transfer the monies collected to the EMATA Fund.
   
   

4. Requires monies in the EMATA Fund to be made available, upon appropriation by the Legislature, to the Department of Health Care Services (DHCS) for administrative costs, with the remainder to be used as follows:

   1. Twenty percent to offset the state portion of the Medi-Cal reimbursement rate for emergency medical air transportation services; and,

   2. Eighty percent to augment emergency medical air transportation reimbursement payments made through the Medi-Cal program.

5. Requires DHCS to seek to obtain federal matching funds by using the monies in the EMATA Fund for the purpose of augmenting Medi-Cal reimbursement paid to emergency medical air transportation providers.
   
   

6. Repeals the section of law establishing EMATA, the Fund, and the Medi-Cal emergency medical air transportation reimbursement provisions on January 1, 2018.

FISCAL EFFECT: According to the Senate Appropriations Committee:

1. Penalty revenues of $11 million to $13 million per year (EMATA Fund).

2. Minor administrative costs to process payments (EMATA Fund).

3. Reduced General Fund expenditures of $2 million to $3 million per year for Medi-Cal payments, by using penalty revenues to offset General Fund expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

4. Annual expenditures of $18 million to $22 million per year for supplemental payments to private emergency air medical service providers (EMATA Fund and federal funds).

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, many emergency patients transported by air ambulances have no insurance, are not eligible for Medi-Cal, and have no ability to pay for the service, yet these patients are given the same high level of care as those with medical insurance. The Medi-Cal fee schedule pays air ambulance services far below the cost of providing emergency air transportation, and pays nothing if the patient is indigent. Emergency air ambulance services provide coverage to multiple counties within a 100-mile radius of their bases, and as a result often their transports originate in a county other than where they are based. This makes it difficult for them to be funded by local tax support except in the largest of counties. Emergency physicians and air ambulances do not receive additional funding through the Disproportionate Share Hospital program or the county Maddy Emergency Medical Services (EMS) Fund when they provide treatment to indigent patients. Prior to enactment of EMATA, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to these services and will prevent funding for air ambulances from reverting back to 1993 levels by continuing the $4 penalty to fund air ambulance services.

2. BACKGROUND. AB 2173 (Beall), Chapter 547, Statutes of 2010, levied a $4 additional penalty on Vehicle Code violations (excluding parking tickets), with the resulting revenue being used as the state match to draw down additional federal Medicaid matching funds to fund Medi-Cal emergency air medical transportation services. To be eligible for the supplemental payments, air medical transportation providers must be:

   1. Actively enrolled as a Medi-Cal air medical transportation provider;

   2. Operate an aircraft that the meets the definition of an “air ambulance;” and,

   3. Be certified by the Federal Aviation Agency to use the aircraft for purposes of being an air medical transportation provider.

As shown in the chart below, between $11.2 and $13.7 million has been raised annually from the AB 2173 penalty assessment. Of that amount, $2.2 to $2.7 million is used as the state match to fund current emergency air ambulance Medi-Cal provider rates. The remaining $9 to $11 million is used to match with federal dollars to augment Medi-Cal rates to emergency air ambulance providers.

State Fiscal Year	EMATA Fund	General Fund Offset	Available for Rate Augmentation
2012-13	$13,750,000	$2,750,000	$11,000,000
2013-14	$11,250,000	$2,250,000	$9,000,000
2014-15	$11,250,000	$2,250,000	$9,000,000
2015-16*	$11,250,000	$2,250,000	$9,000,000

*Projected

The $9 to $11 million augmentation amounts from AB 2173 are provided as supplemental payments to eligible Medi-Cal air medical transportation providers that provide fee-for-service emergency air medical transportation services. The payment augmentation amounts are in addition to the existing fee schedule rate for emergency air medical transportation and mileage services. DHCS’ State Plan Amendment states, the payment augmentation amount and the existing fee schedule rate must not exceed a provider’s usual and customary rates charged to the general public for an emergency air medical transport. Approximately 23 air ambulance providers receive the resulting revenue.

3. PENALTY ASSESSMENTS. According to the Judicial Council, the calculation for a traffic ticket in California, and determining where the money goes once collected, is complex. The cost of a traffic ticket includes a base fine amount plus penalty assessments and fees to fund specific state and local activities. The base fine is collected for, and distributed to, either the local government or local government and county. The increase in the total cost of a traffic ticket (above the base fine) in California over the last 20 years is primarily the result of the addition of mandatory penalty assessments and fees.
   
   Penalty assessments are typically calculated from the base fine for the traffic ticket and are part of the punishment that is imposed for the violation. The penalties collected are distributed to many different city, county, and state funds established by the local government and Legislature for activities such as DNA collection in criminal cases, EMS, local criminal justice facilities, emergency medical air transportation, and court facility maintenance and construction. The chart below lists three examples of the cost and distribution of a typical traffic ticket, including the base fine, penalties, and fees. The chart below, created by the Judicial Council, provides information on a typical ticket for faulty equipment ($25), a moving violation ($35), and driving more than 25 MPH over the speed limit ($100). The penalty assessment (PA) accrues for every $10 or portion of $10 ($.01 to $9.99) of the base fine. For example, if the violation for faulty equipment is $25; the State PA is $30 (3 x $10); the County PA is $21 (3 x $7); the EMS PA is $6 (3 x $2); the DNA Fund PA $15 (3 x $5); and, the Court Facilities PA is $15 (3 x $5).

4. SUPPORT. This bill is sponsored by the California Association of Air Medical Services (Cal-AAMS), which argues this bill will maintain the current level of Medi-Cal funding of emergency air ambulance transportation by extending the sunset clause on the EMATA created in 2010. Cal-AAMSS states air ambulance services provide life-saving emergency transportation to the most critical patients from automobile accident scenes directly to trauma centers. In addition, emergency helicopter air ambulances provide a critical link between rural areas and urban tertiary care hospitals (trauma centers, heart/stroke centers, burn units) and are an essential part of the statewide EMS system. Prior to the EMATA, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to this essential life-saving service, and will prevent funding for air ambulances to revert back to 1993 levels.
   
   The Rural County Representatives of California (RCRC) states that air ambulance service is critical in rural and remote areas of California and a healthy air ambulance system ensures rural communities have access to life-saving care for both residents and tourists. RCRC states its member counties have had no issues in their administrative role in administering the penalty assessment, and they believe the EMATA should be continued in order to promote a vital health care delivery system that is so important in rural and remote areas.
   
   The California Ambulance Association (CAA) notes that ambulance service, including air ambulance, is critical to the health care safety net, providing desperately needed care immediately to all people without exception. Emergency ambulance service providers are legally and morally bound to provide emergency services regardless of a patient’s ability to pay. The funds collected under EMATA are needed for better state funding of air ambulance activities. CAA explains that Medi-Cal rates cover only one quarter of the cost of service, are not updated annually for inflation and have actually been reduced over the last decade. California provides the fourth lowest reimbursement rates for ambulance services provided to Medicaid recipients of all states.

5. PREVIOUS LEGISLATION.

   1. AB 1153 (Beall) of 2009 would have established the Emergency Air Medical Transportation Act, which would create a $3 penalty assessment on all Vehicle Code violations (except parking offenses) to provide a funding source to augment Medi-Cal reimbursement for air ambulance services. AB 1153 was held on the Assembly Appropriations suspense file.

   2. AB 2173 establishes a $4 fee on every vehicle code violation to be collected by the county and transferred to DHCS for deposit in the EMATA Fund to be used in the Medi-Cal Program to obtain federal funds and to fund supplemental payments for emergency medical air transportation services.

REGISTERED SUPPORT / OPPOSITION:

Support

California Association of Air Medical Services (sponsor)

Board for Critical Care Transport Paramedic Certification

California Ambulance Association

California Children’s Hospital Association

California Hospital Association

CALSTAR

Care Flight Critical Care Transport

Children's Hospital Los Angeles

Emergency Nurses Association

Emergency Nurses Association of California

Hall Ambulance Service Incorporated

Helinet Aviation Services

Loma Linda Children's Hospital

Manteca District Ambulance Service

Mercy Medical Center Redding

PHI Air Medical

REACH Air Medical Services

Rural County Representatives of California

Sonora Regional Medical Center

Stanford Life Flight

Opposition

None on file.

Analysis Prepared by: Patty Rodgers / HEALTH / (916) 319-2097

 THIRD READING  

Bill No: SB 326

Author: Beall (D)

Amended: 6/2/15

Vote: 21

SENATE HEALTH COMMITTEE: 8-0, 4/8/15

AYES: Hernandez, Hall, Mitchell, Monning, Nielsen, Pan, Roth, Wolk

NO VOTE RECORDED: Nguyen

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/28/15

AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

SUBJECT: Courts: penalties: emergency services funding

SOURCE: California Association of Air Medical Services

DIGEST: This bill extends the sunset date of the $4 penalty assessment for Vehicle Code violations other than parking offenses, until January 1, 2018, with the resulting revenue deposited in the Emergency Medical Air Transportation Act Fund (Fund). Money in that Fund is primarily used to fund Medi-Cal reimbursement for emergency medical air transportation services.

ANALYSIS:

Existing law:

1. Levies, under the Emergency Medical Air Transportation Act (Act), a penalty of $4 upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense.
   
   

2. Sunsets the assessment of the $4 penalty under the Act commencing January 1, 2016, and transfers any moneys unexpended and unencumbered in the Fund on June 30, 2017, to the General Fund.
   
   

3. Requires the county or the court that imposed the fine to transfer the moneys collected to the Fund.
   
   

4. Requires moneys in the Fund to be made available, upon appropriation by the Legislature, to the Department of Health Care Services (DHCS), to be for payment of DHCS administrative costs, with the remainder being used as follows:

1. Twenty percent to offset the state portion of the Medi-Cal reimbursement rate for emergency medical air transportation services; and,

2. Eighty percent to augment emergency medical air transportation reimbursement payments made through the Medi-Cal program.

5. Requires DHCS to seek to obtain federal matching funds by using the moneys in the Fund for the purpose of augmenting Medi-Cal reimbursement paid to emergency medical air transportation providers.
   
   

6. Repeals the section of law establishing the Act, the Fund, and the Medi-Cal emergency medical air transportation reimbursement provisions on January 1, 2018.

This bill:

1. Extends the sunset date of the $4 penalty assessment established under the Act, from January 1, 2016 to January 1, 2018.

2. Extends the January 1, 2018 sunset date of the Act to January 1, 2020, and makes related changes.

Background

AB 2173 (Beall, Chapter 547, Statutes of 2010), levied a $4 additional penalty on Vehicle Code violations (excluding parking tickets), with the resulting revenue being used as the state match to draw down additional federal Medicaid matching funds to fund Medi-Cal emergency air medical transportation services. Between $11.2 and $13.7 million has been raised annually from the AB 2173 penalty assessment. Of that amount, $2.2 to $2.7 million is used as the state match to fund current emergency air ambulance Medi-Cal provider rates. The remaining $9 to $11 million is used to match with federal dollars to augment Medi-Cal rates to emergency air ambulance providers. The $9 to $11 million augmentation amounts from AB 2173 are provided as supplemental payments to eligible Medi-Cal air medical transportation providers that provide fee-for-service emergency air medical transportation services. Approximately 23 air ambulance providers receive the resulting revenue.

1. Penalty Assessments. According to the Judicial Council, the calculation for a traffic ticket in California, and determining where the money goes once collected, is complex. The cost of a traffic ticket includes a base fine amount plus penalty assessments and fees to fund specific state and local activities. The base fine is collected for, and distributed to, either the local government or local government and county. The increase in the total cost of a traffic ticket (above the base fine) in California over the last 20 years is primarily the result of the addition of mandatory penalty assessments and fees.

Penalty assessments are typically calculated from the base fine for the traffic ticket and are part of the punishment that is imposed for the violation. The penalties collected are distributed to many different city, county, and state funds established by the local government and Legislature for activities such as DNA collection in criminal cases, emergency medical services, local criminal justice facilities, emergency medical air transportation, and court facility maintenance and construction. The chart below lists three examples of the cost and distribution of a typical traffic ticket, including the base fine, penalties, and fees. The chart below, created by the Judicial Council, provides information on a typical ticket for faulty equipment ($25), a moving violation ($35), and driving more than 25 MPH over the speed limit ($100).

Comments

1. Author’s statement. According to the author, “[M]any emergency patients transported by air ambulances have no insurance, are not eligible for Medi-Cal, and have no ability to pay for the service, yet these patients are given the same high level of care as those with medical insurance. The Medi-Cal fee schedule pays air ambulance services far below the cost of providing emergency air transportation, and pays nothing if the patient is indigent. Emergency air ambulance services provide coverage to multiple counties within a 100-mile radius of their bases, and as a result often their transports originate in a county other than where they are based. This makes it difficult for them to be funded by local tax support except in the largest of counties. Emergency physicians and air ambulances do not receive additional funding through the Disproportionate Share Hospital (DSH) program, or the county Maddy Emergency Medical Services Fund when they provide treatment to indigent patients. Prior to enactment of the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to these services and will prevent funding for air ambulances from reverting back to 1993 levels by continuing the $4 penalty to fund air ambulance services.”

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee:

• Penalty revenues of $11 million to $13 million per year (Emergency Medical Air Transportation Act Fund).

• Minor administrative costs to process payments (Emergency Medical Air Transportation Act Fund).

• Reduced General Fund expenditures of $2 million to $3 million per year for Medi-Cal payments, by using penalty revenues to offset General Fund expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

• Annual expenditures of $18 million to $22 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds).

SUPPORT: (Verified 5/26/15)

California Association of Air Medical Services (source)

Board for Critical Care Transport Paramedic Certification

California Ambulance Association

California Children’s Hospital Association

California Hospital Association

CALSTAR

Care Flight

Children’s Hospital Los Angeles

Emergency Nurse Association

Hall Ambulance Service, Inc.

Helinet Aviation Services

Loma Linda Children’s Hospital

Manteca District Ambulance Service

Mercy Air Services

Mercy Medical Center Redding

PHI Air Medical

REACH Air Medical Services

Rural County Representatives of California

Sonora Regional Medical Center

Stanford Life Flight

Two individuals

OPPOSITION: (Verified 5/26/15)

None received

ARGUMENTS IN SUPPORT: This bill is sponsored by the California Association of Air Medical Services (Cal-AAMS), which argues this bill will maintain the current level of Medi-Cal funding of emergency air ambulance transportation by removing the sunset clause on the Act created in 2010. Cal-AAMSS states air ambulance services provide life-saving emergency transportation to the most critical patients from automobile accident scenes directly to trauma centers. In addition, emergency helicopter air ambulance providers provide a critical link between rural areas and urban tertiary care hospitals (trauma centers, heart/stroke centers, burn units) and are an essential part of the statewide emergency medical services system. Prior to the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to this essential life-saving service, and will prevent funding for air ambulances to revert back to 1993 levels. Removing the sunset for this penalty will ensure the program continues to support these critical services.

The Rural County Representatives of California (RCRC) write in support that air ambulance service is critical in rural and remote areas of California and a healthy air ambulance system ensures rural communities have access to life-saving care for both residents and tourists. RCRC states its member counties have had no issues in their administrative role in administering the penalty assessment, and they believe the Act should be continued in order to promote a vital health care delivery system that is so important in rural and remote areas.

Prepared by: Scott Bain / HEALTH /

6/2/15 22:08:12

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

SB 326 (Beall) - Courts: penalties: emergency services funding

SUSPENSE FILE. AS AMENDED.

Bill Summary:

SB 326 would eliminate the sunset on an existing program that levies a $4 penalty assessment for Vehicle Code violations and dedicates the resulting revenues to support emergency air medical transportation services in the Medi-Cal program.

Fiscal Impact (as approved on May 28, 2015):

• Penalty revenues of $11 million to $13 million per year (Emergency Medical Air Transportation Act Fund).

• Minor administrative costs to process payments (Emergency Medical Air Transportation Act Fund).

• Reduced General Fund expenditures of $2 million to $3 million per year for Medi-Cal payments, by using penalty revenues to offset General Fund expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

• Annual expenditures of $18 million to $22 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds).

Background:

Under state and federal law, the Department of Health Care Services operates the Medi-Cal program, which provides health care coverage to low income individuals, families, and children. The federal government provides matching funds that vary from 50 percent to 90 percent of expenditures depending on the category of beneficiary.

Under current practice, when private emergency air ambulance services provide service to Medi-Cal beneficiaries, they are paid through the Medi-Cal fee-for-service system (even if a beneficiary is enrolled in a Medi-Cal managed care plan). The operators of air ambulance services have maintained that the rates paid by Medi-Cal are substantially below their operating costs. Unlike many health care providers, air ambulance providers do not have the option to decide whether or not to accept Medi-Cal patients, given the nature of emergency response situations. (Public agencies operate air ambulances as well. However, because these public agencies generally do not use civilian aircraft that meet federal rules for participation in Medicaid, public agencies have been unable to bill Medi-Cal for emergency air ambulance services provided to Medi-Cal beneficiaries.)

AB 2173 (Beall, Statutes of 2010) levied an additional $4 penalty assessment on Vehicle Code violations (except parking tickets). Under that law, after accounting for administrative costs, the state retains 20 percent of resulting revenues to offset state General Fund expenditures for emergency air ambulance services. The remaining revenues are matched with federal matching funds and then provided to private emergency air ambulance services as supplemental payments, to offset some of the losses incurred in serving Medi-Cal patients. Current law terminates collection of the additional penalty assessment on January 1, 2016. As of June 30, 2017, any unspent funds would be reverted to the General Fund. Current law sunsets the entire program on January 1, 2018.

Proposed Law:

SB 326 would eliminate the sunset on an existing program that levies a $4 penalty assessment for Vehicle Code violations and dedicates the resulting revenues to support emergency air medical transportation services in Medi-Cal.

Staff Comments:

The penalty assessment that would be extended in this bill is only one of many assessments that have been added to Motor Vehicle Code violations over time. In sum, these assessments dramatically increase the cost of a violation. For example, a moving violation penalty that has a base fine of $35 has a total fine, after accounting for all assessments, of $238.

Committee amendments (as adopted May 28, 2015): add a two-year sunset to the bill.

-- END --

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

SB 326 (Beall) - Courts: penalties: emergency services funding

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

SB 326 would eliminate the sunset on an existing program that levies a $4 penalty assessment for Vehicle Code violations and dedicates the resulting revenues to support emergency air medical transportation services in the Medi-Cal program.

Fiscal Impact:

• Penalty revenues of $11 million to $13 million per year (Emergency Medical Air Transportation Act Fund).

• Minor administrative costs to process payments (Emergency Medical Air Transportation Act Fund).

• Reduced General Fund expenditures of $2 million to $3 million per year for Medi-Cal payments, by using penalty revenues to offset General Fund expenditures for emergency air ambulance services for Medi-Cal beneficiaries.

• Annual expenditures of $18 million to $22 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds).

Background:

Under state and federal law, the Department of Health Care Services operates the Medi-Cal program, which provides health care coverage to low income individuals, families, and children. The federal government provides matching funds that vary from 50 percent to 90 percent of expenditures depending on the category of beneficiary.

Under current practice, when private emergency air ambulance services provide service to Medi-Cal beneficiaries, they are paid through the Medi-Cal fee-for-service system (even if a beneficiary is enrolled in a Medi-Cal managed care plan). The operators of air ambulance services have maintained that the rates paid by Medi-Cal are substantially below their operating costs. Unlike many health care providers, air ambulance providers do not have the option to decide whether or not to accept Medi-Cal patients, given the nature of emergency response situations. (Public agencies operate air ambulances as well. However, because these public agencies generally do not use civilian aircraft that meet federal rules for participation in Medicaid, public agencies have been unable to bill Medi-Cal for emergency air ambulance services provided to Medi-Cal beneficiaries.)

AB 2173 (Beall, Statutes of 2010) levied an additional $4 penalty assessment on Vehicle Code violations (except parking tickets). Under that law, after accounting for administrative costs, the state retains 20 percent of resulting revenues to offset state General Fund expenditures for emergency air ambulance services. The remaining revenues are matched with federal matching funds and then provided to private emergency air ambulance services as supplemental payments, to offset some of the losses incurred in serving Medi-Cal patients. Current law terminates collection of the additional penalty assessment on January 1, 2016. As of June 30, 2017, any unspent funds would be reverted to the General Fund. Current law sunsets the entire program on January 1, 2018.

Proposed Law:

SB 326 would eliminate the sunset on an existing program that levies a $4 penalty assessment for Vehicle Code violations and dedicates the resulting revenues to support emergency air medical transportation services in Medi-Cal.

Staff Comments:

The penalty assessment that would be extended in this bill is only one of many assessments that have been added to Motor Vehicle Code violations over time. In sum, these assessments dramatically increase the cost of a violation. For example, a moving violation penalty that has a base fine of $35 has a total fine, after accounting for all assessments, of $238.

-- END --

SENATE COMMITTEE ON HEALTH

Senator Ed Hernandez, O.D., Chair

BILL NO: SB 326

SUBJECT: Courts: penalties: emergency services funding

SUMMARY:

Makes permanent a $4 penalty assessment for Vehicle Code violations other than parking offenses, with the resulting revenue deposited in the Emergency Medical Air Transportation Act Fund (Fund.) Money in that Fund is primarily used to fund Medi-Cal reimbursement for emergency medical air transportation services.

Existing law:

1. Levies, under the Emergency Medical Air Transportation Act (the Act), a penalty of $4 upon every conviction for a violation of the Vehicle Code, or a local ordinance adopted pursuant to the Vehicle Code, other than a parking offense.
   
   

2. Sunsets the assessment of the $4 penalty under the Act commencing January 1, 2016, and transfers any moneys unexpended and unencumbered in the Fund on June 30, 2017 to the General Fund.
   
   

3. Requires the county or the court that imposed the fine to transfer the moneys collected to the Emergency Medical Air Transportation Act Fund.
   
   

4. Requires moneys in the Fund to be made available, upon appropriation by the Legislature, to the Department of Health Care Services (DHCS), to be for payment of DHCS administrative costs, with the remainder being used as follows:
   
   

   1. Twenty percent to offset the state portion of the Medi-Cal reimbursement rate for emergency medical air transportation services; and,

   2. Eighty percent to augment emergency medical air transportation reimbursement payments made through the Medi-Cal program.
      
      

5. Requires DHCS to seek to obtain federal matching funds by using the moneys in the Fund for the purpose of augmenting Medi-Cal reimbursement paid to emergency medical air transportation providers.
   
   

6. Repeals the section of law establishing the Act, the Fund and the Medi-Cal emergency medical air transportation reimbursement provisions on January 1, 2018.

This bill:

1. Deletes the January 1, 2016 sunset date of the $4 penalty assessment established under the Act, thereby extending its operation permanently.

2. Deletes the January 1, 2018 sunset date of the Act, thereby extending its provisions permanently, and makes related changes.

FISCAL EFFECT:

This bill has not been analyzed by a fiscal committee.

COMMENTS:

1. Author’s statement. According to the author, many emergency patients transported by air ambulances have no insurance, are not eligible for Medi-Cal, and have no ability to pay for the service, yet these patients are given the same high level of care as those with medical insurance. The Medi-Cal fee schedule pays air ambulance services far below the cost of providing emergency air transportation, and pays nothing if the patient is indigent. Emergency air ambulance services provide coverage to multiple counties within a 100-mile radius of their bases, and as a result often their transports originate in a county other than where they are based. This makes it difficult for them to be funded by local tax support except in the largest of counties. Emergency physicians and air ambulances do not receive additional funding through the Disproportionate Share Hospital (DSH) program, or the county Maddy Emergency Medical Services Fund when they provide treatment to indigent patients. Prior to enactment of the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to these services and will prevent funding for air ambulances from reverting back to 1993 levels by continuing the $4 penalty to fund air ambulance services.

2. Background. AB 2173 (Beall), Chapter 547, Statutes of 2010, levied a $4 additional penalty on Vehicle Code violations (excluding parking tickets), with the resulting revenue being used as the state match to draw down additional federal Medicaid matching funds to fund Medi-Cal emergency air medical transportation services. To be eligible for the supplemental payments, air medical transportation providers must be

1. Actively enrolled as a Medi-Cal air medical transportation provider;

2. Operate an aircraft that the meets the definition of an “air ambulance;” and,

3. Be certified by the Federal Aviation Agency to use the aircraft for purpose of being an air medical transportation provider.

As shown in the chart below, between $11.2 and $13.7 million has been raised annually from the AB 2173 penalty assessment. Of that amount, $2.2 to $2.7 million is used as the state match to fund current emergency air ambulance Medi-Cal provider rates. The remaining $9 to $11 million is used to match with federal dollars to augment Medi-Cal rates to emergency air ambulance providers.

*Projected

The $9 to $11 million augmentation amounts from AB 2173 are provided as supplemental payments to eligible Medi-Cal air medical transportation providers that provide fee-for-service emergency air medical transportation services. The payment augmentation amounts are in addition to the existing fee schedule rate for emergency air medical transportation and mileage services. Per DHCS’ State Plan Amendment, the payment augmentation amount and the existing fee schedule rate must not exceed a provider’s usual and customary rates charged to the general public for an emergency air medical transport. Approximately 23 air ambulance providers receive the resulting revenue.

3. Penalty Assessments. According to the Judicial Council, the calculation for a traffic ticket in California, and determining where the money goes once collected, is complex. The cost of a traffic ticket includes a base fine amount plus penalty assessments and fees to fund specific state and local activities. The base fine is collected for, and distributed to, either the local government or local government and county. The increase in the total cost of a traffic ticket (above the base fine) in California over the last 20 years is primarily the result of the addition of mandatory penalty assessments and fees.
   
   Penalty assessments are typically calculated from the base fine for the traffic ticket and are part of the punishment that is imposed for the violation. The penalties collected are distributed to many different city, county, and state funds established by the local government and Legislature for activities such as DNA collection in criminal cases, emergency medical services, local criminal justice facilities, emergency medical air transportation, and court facility maintenance and construction. The chart below lists three examples of the cost and distribution of a typical traffic ticket, including the base fine, penalties, and fees. The chart below, created by the Judicial Council, provides information on a typical ticket for faulty equipment ($25), a moving violation ($35), and driving more than 25 MPH over the speed limit ($100).

4. Prior legislation. AB 1153 (Beall), of 2009, would have established the Emergency Air Medical Transportation Act, which would create a $3 penalty assessment on all Vehicle Code violations (except parking offenses) to provide a funding source to augment Medi-Cal reimbursement for air ambulance services. AB 1153 was held on the Assembly Appropriations suspense file.
   
   

5. Support. This bill is sponsored by the California Association of Air Medical Services (Cal-AAMS), which argues this bill will maintain the current level of Medi-Cal funding of emergency air ambulance transportation by removing the sunset clause on the Act created in 2010. Cal-AAMSS states air ambulance services provide life-saving emergency transportation to the most critical patients from automobile accident scenes directly to trauma centers. In addition, emergency helicopter air ambulance providers provide a critical link between rural areas and urban tertiary care hospitals (trauma centers, heart/stroke centers, burn units) and are an essential part of the statewide emergency medical services system. Prior to the Act, Medi-Cal funding for air ambulances had not increased for nearly 20 years. This bill will continue to provide critical funding to this essential life-saving service, and will prevent funding for air ambulances to revert back to 1993levels. Removing the sunset for this penalty will ensure the program continues to support these critical services.
   
   The Rural County Representatives of California (RCRC) write in support that air ambulance service is critical in rural and remote areas of California and a healthy air ambulance system ensures rural communities have access to life-saving care for both residents and tourists. RCRC states its member counties have had no issues in their administrative role in administering the penalty assessment, and they believe the Act should be continued in order to promote a vital health care delivery system that is so important in rural and remote areas.

SUPPORT AND OPPOSITION:

Support: California Association of Air Medical Services (sponsor)

Board for Critical Care Transport Paramedic Certification

California Ambulance Association

California Children’s Hospital Association

California Hospital Association

CALSTAR

Care Flight

Children’s Hospital Los Angeles

Emergency Nurse Association

Helinet Aviation Services

Loma Linda Children’s Hospital

Manteca District Ambulance Service

Mercy Air Services

Mercy Medical Center Redding

PHI Air Medical

REACH Air Medical Services

Rural County Representatives of California

Sonora Regional Medical Center

Stanford Life Flight

Two individuals

Oppose: None received

-- END --