Existing law requires the Department of Health Care Access and Information, formerly the Office of Statewide Health Planning and Development, in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for clinics, as specified, in the California Building Standards Code.

This bill would require construction standards for the community clinics or rural health clinics, as defined, established by the department and established or applied by a city or county to comply with safety and accessibility standards required for the physical environment of a clinic to ensure participation in the federal Medicare and Medicaid programs. If the standards are amended, the bill would prohibit the amended standards from being more restrictive or stringent than specified construction standards. The bill would require the Department of Health Care Access and Information to hold a minimum of 2 public meetings to solicit public comment on the proposed new standards.

Existing law imposes plan review and building inspection responsibilities on cities and counties for the construction or alteration of buildings where outpatient clinical services or limited inpatient services of a licensed health facility, as defined, are provided when those buildings are separated from a building in which hospital services are provided. Existing law prohibits building standards for the construction or alteration of these buildings from being more restrictive or comprehensive than comparable building standards established or applied to licensed clinics, as defined.

This bill would remove the prohibition described above.

Existing law requires the Department of Health Care Access and Information, formerly the Office of Statewide Health Planning and Development, in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for clinics, as specified, in the California Building Standards Code.

This bill would require construction standards for the community clinics or rural health clinics, as defined, established by the department and established or applied by a city or county to comply with safety and accessibility standards required for the physical environment of a clinic to ensure participation in the federal Medicare and Medicaid programs. If the standards are amended, the bill would prohibit the amended standards from being more restrictive or stringent than specified construction standards. The bill would require the Department of Health Care Access and Information to hold a minimum of 2 public meetings to solicit public comment on the proposed new standards.

Existing law imposes plan review and building inspection responsibilities on cities and counties for the construction or alteration of buildings where outpatient clinical services or limited inpatient services of a licensed health facility, as defined, are provided when those buildings are separated from a building in which hospital services are provided. Existing law prohibits building standards for the construction or alteration of these buildings from being more restrictive or comprehensive than comparable building standards established or applied to licensed clinics, as defined.

This bill would remove the prohibition described above.

Existing law requires the Department of Health Care Access and Information, formerly the Office of Statewide Health Planning and Development, in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for clinics, as specified, in the California Building Standards Code.

This bill would prohibit require construction standards for the community clinics or rural health clinics, as defined, established by the department and established or applied by a city or county from being more restrictive than comparable construction standards established or otherwise applied to clinics exempt from licensure under specified provisions. to comply with safety and accessibility standards required for the physical environment of a clinic to ensure participation in the federal Medicare and Medicaid programs. If the standards are amended, the bill would prohibit the amended standards from being more restrictive or stringent than specified construction standards. The bill would require the Department of Health Care Access and Information to hold a minimum of 2 public meetings to solicit public comment on the proposed new standards.

Existing law imposes plan review and building inspection responsibilities on cities and counties for the construction or alteration of buildings where outpatient clinical services or limited inpatient services of a licensed health facility, as defined, are provided when those buildings are separated from a building in which hospital services are provided. Existing law prohibits building standards for the construction or alteration of these buildings from being more restrictive or comprehensive than comparable building standards established or applied to licensed clinics, as defined.

This bill would remove the prohibition described above.

Existing law, the State Housing Law, establishes statewide construction and occupancy standards for buildings used for human habitation. That law requires the building department of every city or county to enforce within its jurisdiction the provisions of the State Building Standards Code, the provisions of the State Housing Law, and specified other rules and regulations promulgated pursuant to that law. Existing law defines terms for purposes of this law.

This bill would make a nonsubstantive change to those definition provisions.

 UNFINISHED BUSINESS  

Bill No: SB 1382

Author: Glazer (D)

Amended: 8/22/24

Vote: 21

SENATE HEALTH COMMITTEE: 11-0, 4/22/24

AYES: Roth, Nguyen, Glazer, Gonzalez, Grove, Hurtado, Limón, Menjivar, Rubio, Smallwood-Cuevas, Wiener

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/16/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

SENATE FLOOR: 37-0, 5/23/24

AYES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

NO VOTE RECORDED: Allen, Archuleta, Newman

ASSEMBLY FLOOR: 76-0, 8/29/24 - See last page for vote

SUBJECT: Community and rural health clinics: building standards

SOURCE: Author

DIGEST:

This bill requires construction standards for a licensed community clinics to comply with the federal safety and accessibility standards required for clinics to participate in Medi-Cal and Medicare, and repeals a provision of law prohibiting building standards for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards applied to licensed clinics.

Assembly Amendments

delete the requirement that construction standards for licensed community clinics not be more restrictive or comprehensive than comparable standards applied to county clinics that are exempt from licensure, and instead requires the construction standards for licensed community clinics to comply with the federal safety and accessibility standards required for clinics to participate in Medi-Cal or Medicare, as specified. Additionally, amendments add a requirement that the Department of Health Care Access and Information hold a minimum of two public meetings to on any proposed new construction standards for community clinics.

ANALYSIS:

Existing law:

1. Licenses and regulates clinics, including primary care clinics and specialty clinics, by the California Department of Public Health (CDPH), and defines a primary care clinic as either a “community clinic,” which is required to be operated by a non-profit corporation and to use a sliding fee scale to charge patients based on their ability to pay, or a “free clinic,” which is also required to be operated by a non-profit but is not allowed to directly charge patients for services rendered or for any drugs, medicines, or apparatuses furnished. [HSC §1200 et seq., §1204]
2. Exempts various types of clinics from licensure and regulation by CDPH, including the following: any place or establishment operated as a clinic or office by one or more licensed health care practitioners and used as an office for the practice of their profession, within the scope of their license; clinics operated by the federal government, the state, counties, cities, or federally recognized Indian tribes on tribal land; a clinic operated by any institution of learning that teaches a healing art; medical foundation clinics; and, the offices of physicians in group practice who provide the preponderance of their services to members of a health plan. [HSC §1206]
3. Exempts from CDPH licensure an intermittent clinic that is operated by a licensed primary care community clinic on separate premises from the licensed clinic and is only open for limited services of no more than 40 hours each week. However, an intermittent clinic operated under this exemption is still required to meet all other requirements of law, including administrative regulations and requirements, pertaining to fire and life safety. [HSC §1206(h)]
4. Requires the Department of Health Care Access and Information (HCAI), in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for the physical plant of clinics as found in the California Building Standards Code. This is known as “OSHPD 3,” because it is regulated by the Office of Statewide Hospital Planning and Development (OSHPD) within HCAI. [HSC §1226(b)]
5. Prohibits the construction standards for buildings where outpatient clinical services of a hospital are provided that is separate from a building in which hospital services are provided from being more restrictive or comprehensive than the building standards established for licensed clinics. Limits these buildings from providing more than 25% of the total outpatient services to inpatients of the hospital. [HSC §129725, §129885]
6. Establishes the Community Clinics Advisory Committee, which is required to meet on an ad hoc basis and to be comprised of at least 15 individuals who are employed by, or under contract to provide service to, a community clinic on a full-time basis, either directly or as a representative of a clinic association. Requires members of the committee to be appointed by the three statewide primary clinic associations in California that represent the greatest number of community or free clinic sites. [HSC §1226.2]

This bill:

1. Requires the construction standards for the construction or alteration of a community clinic or a rural health clinic, as defined, established under specified provisions of existing law or applied by a city or county, to comply with the safety and accessibility standards required for the physical environment of a clinic to ensure participation in the federal Medicare and Medi-Cal programs, as specified in federal regulations.
2. Prohibits the construction standards for clinics, if they are amended, from being more restrictive or stringent than the OSHPD 3 regulations.
3. Requires HCAI, during the regulation promulgation process for amending construction standards for clinics, to hold a minimum of two public meetings to solicit public comment on the proposed new standards.
4. Repeals a provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards established, or otherwise applied, to licensed clinics.

Comments

1. Author’s statement. According to the author, “this bill right-sizes building and construction standards that primary care clinics must comply with by requiring the clinics to meet federal standards for Medicare and Medi-Cal participation, rather than more onerous OSHPD 3 standards. OSHPD 3 standards require more complex electrical, plumbing, ventilation and mechanical systems. These standards are more appropriate for hospital clinics because 25% of their care can be inpatient services, where a hospital admits a patient overnight. In comparison, primary care clinics only provide primary care outpatient services, like reproductive care and wellness checkups. This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our state’s most vulnerable and underserved rural and urban populations. Over 1,270 community clinics provide critical, high-quality healthcare services to more than 1 in 5 Californians, regardless of their ability to pay, immigration status, or other individual circumstances. Current law requires primary care clinics to adhere to the same building and property acquisition standards as their larger in-patient counterparts, hindering their ability to grow and meet the needs of their communities."
2. OSHPD 3 building code requirements vs. building requirements for unlicensed clinic settings. While primary care clinics are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet certain building code requirements, known as OSHPD 3 requirements. In addition to primary care clinics, OSHPD 3 requirements also apply to outpatient clinical services of a hospital, but do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics, or doctor’s offices. Building codes are updated on a triennial basis, and for a long time, the changes to OSHPD 3 requirements were modest and minor. In the triennial cycle that resulted in the publication of the 2013 building codes, however, OSHPD pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a big jump up in requirements, and led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic/outpatient facility. OSHPD 3 requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to a survey that the California Primary Care Association conducted of its member clinics in 2017, the most difficult requirements of OSHPD 3 were related to mechanical ventilation requirements. Clinics reported that the average increase in project costs was 112%, and one clinic reported that it had specifically not opened a new facility in an area of high demand for services, due to the costs of complying with OSHPD 3. According to HCAI’s OSHPD 3 checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with OSHPD 3 and other applicable building code requirements. However, HCAI’s checklist states that existing clinic facilities that have architectural conditions, such as room size or corridor width, that fail to meet the requirements of OSHPD 3 but were compliant at the time of their construction, may be considered acceptable, even if the clinical space is being reused under a new tenant/owner, if the use does not change.

The ability to avoid having to comply with OSHPD 3 requirements was one of the primary motivating factors for the recent expansion in the number of hours an “intermittent clinic” could be open and still be exempt from licensure (and therefore exempt from compliance with OSHPD 3). Legislation in 2015 increased the hours that an intermittent clinic could be open from 20 to 30 hours per week, and in 2018, it was increased a second time to 40 hours per week.

1. Standards for primary care clinics linked to those of hospital-based clinics. As noted above, OSHPD 3 requirements apply to clinics that are licensed by CDPH, including primary care clinics, as well as outpatient clinical services that are part of a hospital’s license. There is a provision of law that prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. However, as the author points out, hospital-based clinical settings can provide as much as 25% of their care to inpatients, which are typically of a higher acuity level than those seen at primary care clinics. As stated by HCAI, current statute “requires free standing primary care clinics, that are unaffiliated with a hospital and that will never provide inpatient services, to nonetheless meet higher building standards applied to facilities that must be prepared to provide inpatient services.” The author argues that this statutory link is what is stopping HCAI from modifying their primary care clinic standards to the appropriate acuity level for a primary care setting. The author and sponsor point out that private physician offices, and even county clinics, since they are exempt from licensure, are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a primary care clinic acquires one of these unlicensed settings, they are required to meeting OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3.
2. Community Clinics Advisory Committee. Under existing law, OSHPD 3 requirements are required to be established by HCAI “in consultation with the Community Clinic Advisory Committee” (CAC). However, the CAC had not been convened when the 2013 update to OSHPD 3 (which caused concern among the clinic community) was adopted. It has since been convened, and HCAI states the CAC has been meeting for approximately four years and continues to meet quarterly. With HCAI’s guidance, the CAC has worked to better align the needs of primary care clinics when they are converting an existing clinic or clinic building into an OSHPD 3 building. As part of this effort, HCAI has restructured the Plan of Modernization (POM) program to be more flexible with the sequencing of achieving OSHPD 3 compliance. The POM program allows clinics three years to meet OSHPD 3 standards and operate as a clinic while they correct any deficiencies. This means that the clinic space can be put in operation prior to completion of the work necessary to bring it into compliance. With the revisions to the POM, the path to meet OSHPD 3 has more flexibility to achieve compliance. The revisions also allow primary care clinics to know what is expected, which in turn, helps estimate the costs prior to acquiring or leasing an existing space for their clinical needs.

HCAI states that it has also restructured the clinic checklists and guides providing local jurisdictions more guidance when reviewing existing clinics that are converting into an OSHPD 3 setting. These revisions include providing a tolerance or some limited flexibility with OSHPD 3 requirements for existing room sizes and some utilities.

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

According to the Assembly Appropriations Committee, HCAI estimates costs of approximately $193,000 in fiscal year (FY) 2025-26 and $202,000 in FY 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop, and repeal, or propose for adoption, building standards specific to primary care clinics in a future Title 24 Code Adoption Cycle, and participation with the Community Clinics Advisory Committee, the Hospital Building Safety Board, and public stakeholder meetings.

SUPPORT: (Verified 8/28/24)

Adventist Health

Alameda Health Consortium

APLA Health

Arroyo Vista Family Health Center

Asian Americans for Community Involvement

Asian Health Services

California Partnership for Health

Central Valley Health Network

California Primary Care Association Advocates

Chapa-De Indian Health

CommuniCare+OLE

Community Clinic Association of Los Angeles County

Dientes Community Dental

El Proyecto Del Barrio, Inc.

Elica Health Centers

Family Health Centers of Greater Los Angeles

Family Health Centers of San Diego

Friends of Family Health Center

Golden Valley Health Centers

Health Alliance of Northern California

Health and Life Organization, Inc.

Health Center Partners of Southern California

Hill County Community Clinic

Hurtt Family Health Clinic

Inland Family Community Health Center

Lifelong Medical Center

Neighborhood Healthcare Center

North Coast Clinics Network

North East Medical Services

Northeast Valley Health Corporation

Saban Community Clinic

Samuel Dixon Family Health Center, Inc.

San Diego Regional Chamber

San Francisco Community Clinic Consort

San Ysidro Health

Santa Rosa Community Health

Share Our Selves

Shasta Community Health Center

Sierra Family Health Center

St. John’s Community Health

St. Jude Neighborhood Health Center

Tarzana Treatment Centers, Inc.

Tiburcio Vasquez Health Center, Inc.

TrueCare

Venice Family Clinic

OPPOSITION: (Verified 8/28/24)

Department of Finance (prior version)

ARGUMENTS IN SUPPORT: This bill is supported by CPCA Advocates, and a long list of community health centers and related organizations. According to the CPCA Advocates, this bill will modernize licensing and building standards requirements for community health centers while continuing to provide necessary patient protection by tying requirements to the existing standards for county clinics. Current building standards apply the same standards to both community health centers and outpatient clinical services of a general acute care hospital. CPCA Advocates states that this is problematic because in the community health care setting only outpatient services are provided, while hospital clinics are allowed to provide up to 25% of their care as inpatient services. Consequently, CPCA Advocates states that these standards are tailored to address the higher acuity needs of inpatient services allowed for hospital-based clinics. Existing law is stopping the state from modifying clinic standards to the appropriate acuity level for a primary care outpatient clinic setting. CPCA Advocates states that private physician offices and county clinics who provide the same services as licensed clinics currently operate outside of the hospital-based construction requirements, without any documented risk to public health and safety. Numerous community health centers write in support with similar arguments, and state that current standards result in barriers to access patient care because community health centers are required to utilize funds for unnecessary construction costs rather than expanding healthcare services or opening additional clinics in underserved areas.

ARGUMENTS IN OPPOSITION: The Department of Finance submitted a letter opposed to the prior version of this bill, stating that it could potentially compromise the health and safety of patients in these facilities.

ASSEMBLY FLOOR: 76-0, 8/29/24

AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Robert Rivas

NO VOTE RECORDED: Cervantes, Ortega, Zbur

Click here to enter text.

Prepared by: Vincent D. Marchand / HEALTH / (916) 651-4111

8/29/24 19:36:47

**** END ****

SENATE THIRD READING

STR Bill Id:SB 1382

Author:(Glazer)

As Amended Ver:August 22, 2024

Majority vote

SUMMARY

Requires construction standards for community clinics or rural health clinics, as defined, established by the Department of Health Care Access and Information (HCAI) and established or applied by a city or county, to comply with safety and accessibility standards for participation in Medicare and Medicaid programs. Prohibits those standards, if they are amended, from being more restrictive than the Office of Statewide Hospital Planning and Development (OSHPD) 3 requirements discussed below. Requires HCAI to hold a minimum of two public meetings solicit public comment on the proposed new standards. Repeals a provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards applied to licensed clinics.

Major Provisions

COMMENTS

1. OSHPD 3 building code requirements vs. building requirements for unlicensed clinic settings. While primary care clinics (PCCs) are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet certain building code requirements, known as OSHPD 3 requirements. In addition to PCCs, OSHPD 3 requirements also apply to outpatient clinical services of a hospital, but do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics, or doctor's offices. Building codes are updated on a triennial basis, and for a long time, the changes to OSHPD 3 requirements were modest and minor. In the triennial cycle that resulted in the publication of the 2013 building codes, however, HCAI, (then OSHPD) pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a big change in requirements, and led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic/outpatient facility.

OSHPD 3 requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to a survey that the California Primary Care Association conducted of its member clinics in 2017, the most difficult requirements of OSHPD 3 were related to mechanical ventilation requirements. Clinics reported that the average increase in project costs was 112%, and one clinic reported that it had specifically not opened a new facility in an area of high demand for services, due to the costs of complying with OSHPD 3. According to HCAI's OSHPD 3 checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with OSHPD 3 and other applicable building code requirements. However, HCAI's checklist states that existing clinic facilities that have architectural conditions, such as room size or corridor width, that fail to meet the requirements of OSHPD 3 but were compliant at the time of their construction, may be considered acceptable, even if the clinical space is being reused under a new tenant/owner, if the use does not change.

1. Standards for PCCs linked to those of hospital-based clinics. As noted above, OSHPD 3 requirements apply to clinics that are licensed by DPH, including PCCs, as well as outpatient clinical services that are part of a hospital's license. There is a provision of law that prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. However, as the author points out, hospital-based clinical settings can provide as much as 25% of their care to inpatients, which are typically of a higher acuity level than those seen at PCCs. As stated by HCAI, current statute "requires free standing PCCs, that are unaffiliated with a hospital and that will never provide inpatient services, to nonetheless meet higher building standards applied to facilities that must be prepared to provide inpatient services." The author argues that this statutory link is what is stopping HCAI from modifying their PCC standards to the appropriate acuity level for a primary care setting. The author and sponsor point out that private physician offices, and even county clinics, since they are exempt from licensure, are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a PCC acquires one of these unlicensed settings, they are required to meet OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3.
2. Community Clinics Advisory Committee (CAC). Under existing law, OSHPD 3 requirements are required to be established by HCAI "in consultation with the Community CAC." However, the CAC had not been convened when the 2013 update to OSHPD 3 (which caused concern among the clinic community) was adopted. It has since been convened, and HCAI states the CAC has been meeting for approximately four years and continues to meet quarterly. With HCAI's guidance, the CAC has worked to better align the needs of PCCs when they are converting an existing clinic or clinic building into an OSHPD 3 building. As part of this effort, HCAI has restructured the Plan of Modernization (POM) program to be more flexible with the sequencing of achieving OSHPD 3 compliance. The POM program allows clinics three years to meet OSHPD 3 standards and operate as a clinic while they correct any deficiencies. This means that the clinic space can be put in operation prior to completion of the work necessary to bring it into compliance. With the revisions to the POM, the path to meet OSHPD 3 has more flexibility to achieve compliance. The revisions also allow PCCs to know what is expected, which in turn, helps estimate the costs prior to acquiring or leasing an existing space for their clinical needs.

HCAI states that it has also restructured the clinic checklists and guides providing local jurisdictions more guidance when reviewing existing clinics that are converting into an OSHPD 3 setting. These revisions include providing a tolerance or some limited flexibility with OSHPD 3 requirements for existing room sizes and some utilities.

According to the Author

This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our states most vulnerable and underserved rural and urban populations. The author notes that over 1,270 PCCs provide critical, high-quality healthcare services to more than one in five Californians, regardless of their ability to pay, immigration status, or other individual circumstances. The author concludes that current law requires PCCs to adhere to the same building and property acquisition standards as their larger in-patient counterparts, hindering their ability to grow and meet the needs of their communities.

Arguments in Support

The California Primary Care Association (CPCA) supports this bill and states that current standards result in barriers to access patient care because CHCs are required to utilize funds for unnecessary construction costs rather than expanding healthcare services or opening additional clinics in underserved communities. Private physician offices and county clinics who provide the same services as CHCs, currently operate outside of the hospital-based construction requirements without any documented risk to public health and safety or environmental protections. CPCA concludes that this bill will ensure health centers can successfully meet rising inflationary costs and continue providing innovative, quality, community-based, equitable care to their 7.7 million patients.

Arguments in Opposition

The Department of Finance is opposed to this bill and states that it could potentially and unintentionally compromise the health and safety of patients in these facilities.

FISCAL COMMENTS

According to the Assembly Appropriations Committee, HCAI estimates costs of approximately $193,000 in fiscal year (FY) 2025-26 and $202,000 in FY 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop, and repeal, or propose for adoption, building standards specific to primary care clinics in a future Title 24 Code Adoption Cycle, and participation with the Community Clinics Advisory Committee, the Hospital Building Safety Board, and public stakeholder meetings.

VOTES

SENATE FLOOR: 37-0-3

YES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ABS, ABST OR NV: Allen, Archuleta, Newman

ASM HEALTH: 16-0-0

YES: Bonta, Waldron, Aguiar-Curry, Arambula, Jackson, Flora, Haney, Jones-Sawyer, Maienschein, McCarty, Joe Patterson, Rodriguez, Sanchez, Santiago, Schiavo, Weber

ASM APPROPRIATIONS: 14-0-1

YES: Wicks, Sanchez, Arambula, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Grayson, Haney, Hart, Pellerin, Ta, Villapudua

ABS, ABST OR NV: Jim Patterson

UPDATED

VERSION: August 22, 2024

CONSULTANT: Lara Flynn / HEALTH / (916) 319-2097 FN: 0004529

SENATE THIRD READING

STR Bill Id:SB 1382

Author:(Glazer)

As Amended Ver:March 20, 2024

Majority vote

SUMMARY

Prohibits construction standards for community clinics or rural health clinics, as defined, established by the Department of Health Care Access and Information (HCAI) and established or applied by a city or county, from being more restrictive than comparable construction standards established or otherwise applied to clinics exempt from licensure. Repeals a provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards applied to licensed clinics.

Major Provisions

COMMENTS

1. Office of Statewide Hospital Planning and Development (OSHPD) 3 building code requirements vs. building requirements for unlicensed clinic settings. While primary care clinics (PCCs) are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet certain building code requirements, known as OSHPD 3 requirements. In addition to PCCs, OSHPD 3 requirements also apply to outpatient clinical services of a hospital, but do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics, or doctor's offices. Building codes are updated on a triennial basis, and for a long time, the changes to OSHPD 3 requirements were modest and minor. In the triennial cycle that resulted in the publication of the 2013 building codes, however, HCAI, (then OSHPD) pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a big change in requirements, and led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic/outpatient facility.

OSHPD 3 requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to a survey that the California Primary Care Association conducted of its member clinics in 2017, the most difficult requirements of OSHPD 3 were related to mechanical ventilation requirements. Clinics reported that the average increase in project costs was 112%, and one clinic reported that it had specifically not opened a new facility in an area of high demand for services, due to the costs of complying with OSHPD 3. According to HCAI's OSHPD 3 checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with OSHPD 3 and other applicable building code requirements. However, HCAI's checklist states that existing clinic facilities that have architectural conditions, such as room size or corridor width, that fail to meet the requirements of OSHPD 3 but were compliant at the time of their construction, may be considered acceptable, even if the clinical space is being reused under a new tenant/owner, if the use does not change.

This bill seeks to apply the same building code standards that currently apply to county clinics to all licensed clinics. Because county clinics are exempt from licensure (as noted in 3) c) of existing law, above), they are exempt from OSHPD 3. According to OSHPD, settings that are exempt from OSHPD 3, such as medical office buildings and county clinics, still have to meet all other state and local building code requirements that apply to office buildings generally, but are not subject to healthcare-specific standards adopted by HCAI.

The ability to avoid having to comply with OSHPD 3 requirements was one of the motivating factors for the recent expansion in the number of hours an "intermittent clinic" could be open and still be exempt from licensure (and therefore exempt from compliance with OSHPD 3). As noted in Previous Legislation below, legislation in 2015 increased the hours that an intermittent clinic could be open from 20 to 30 hours per week, and in 2018, it was increased a second time to 40 hours per week.

1. Standards for PCCs linked to those of hospital-based clinics. As noted above, OSHPD 3 requirements apply to clinics that are licensed by DPH, including PCCs, as well as outpatient clinical services that are part of a hospital's license. There is a provision of law that prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. However, as the author points out, hospital-based clinical settings can provide as much as 25% of their care to inpatients, which are typically of a higher acuity level than those seen at PCCs. As stated by HCAI, current statute "requires free standing PCCs, that are unaffiliated with a hospital and that will never provide inpatient services, to nonetheless meet higher building standards applied to facilities that must be prepared to provide inpatient services." The author argues that this statutory link is what is stopping HCAI from modifying their PCC standards to the appropriate acuity level for a primary care setting. The author and sponsor point out that private physician offices, and even county clinics, since they are exempt from licensure, are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a PCC acquires one of these unlicensed settings, they are required to meeting OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3.
2. Community Clinics Advisory Committee (CAC). Under existing law, OSHPD 3 requirements are required to be established by HCAI "in consultation with the Community CAC." However, the CAC had not been convened when the 2013 update to OSHPD 3 (which caused concern among the clinic community) was adopted. It has since been convened, and HCAI states the CAC has been meeting for approximately four years and continues to meet quarterly. With HCAI's guidance, the CAC has worked to better align the needs of PCCs when they are converting an existing clinic or clinic building into an OSHPD 3 building. As part of this effort, HCAI has restructured the Plan of Modernization (POM) program to be more flexible with the sequencing of achieving OSHPD 3 compliance. The POM program allows clinics three years to meet OSHPD 3 standards and operate as a clinic while they correct any deficiencies. This means that the clinic space can be put in operation prior to completion of the work necessary to bring it into compliance. With the revisions to the POM, the path to meet OSHPD 3 has more flexibility to achieve compliance. The revisions also allow PCCs to know what is expected, which in turn, helps estimate the costs prior to acquiring or leasing an existing space for their clinical needs.

HCAI states that it has also restructured the clinic checklists and guides providing local jurisdictions more guidance when reviewing existing clinics that are converting into an OSHPD 3 setting. These revisions include providing a tolerance or some limited flexibility with OSHPD 3 requirements for existing room sizes and some utilities.

1. Affiliate clinic licensure. SB 442 (Ducheny), Chapter 502, Statutes of 2010, streamlined provisions related to PCC affiliate licensure. Under SB 442, a PCC that has held a license for five years with no history of repeated or uncorrected violations can apply for an "affiliate clinic" license to establish a PCC at an additional site. An affiliate license application does not require an initial onsite survey, and is a more simplified and streamlined process than applying for a new stand-alone license. Additionally, PCCs operating under a single corporation utilizing the affiliate licensing option are entitled to consolidate certain administrative functions such as billing and related financial functions, purchasing functions, and offsite storage and maintenance of certain patient and personnel records. However, affiliate clinic sites must still provide evidence of compliance with OSHPD 3.

According to the Author

This bill right-sizes building and construction standards that PCCs must comply with by allowing these clinics to follow their city and county clinic building standards, like federal clinics and doctor's offices, rather than more onerous OSHPD 3 standards. OSHPD 3 standards require more complex electrical, plumbing, ventilation, and mechanical systems. These standards are more appropriate for hospital clinics because 25% of their care can be inpatient services, where a hospital admits a patient overnight. In comparison, PCCs only provide primary care outpatient services, like reproductive care and wellness checkups. This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our states most vulnerable and underserved rural and urban populations. The author notes that over 1,270 PCCs provide critical, high-quality healthcare services to more than one in five Californians, regardless of their ability to pay, immigration status, or other individual circumstances. The author concludes that current law requires PCCs to adhere to the same building and property acquisition standards as their larger in-patient counterparts, hindering their ability to grow and meet the needs of their communities.

Arguments in Support

The California Primary Care Association (CPCA) supports this bill and states that it modernizes licensing and building standard requirements for community health centers (CHCs) while continuing to provide necessary patient protection by tying requirements to the existing standards for county clinics. Current building standards apply to both CHCs, and clinical services of a general acute care hospital. This is problematic because in the CHC setting only outpatient services are provided, while hospital clinics are allowed to provide up to 25% of their care as inpatient services. Subsequently these standards are tailored to address the higher acuity needs of inpatient services allowed for hospital-based clinics. Existing law is stopping the state from modifying CHC standards to the appropriate acuity level for a primary care outpatient clinic setting. As a critical component to California's healthcare delivery system, CHCs provide quality healthcare services to low-income individuals and families that are often uninsured or underinsured or living in healthcare deserts. Current standards result in barriers to access patient care because CHCs are required to utilize funds for unnecessary construction costs rather than expanding healthcare services or opening additional clinics in underserved communities. Private physician offices and county clinics who provide the same services as CHCs, currently operate outside of the hospital-based construction requirements without any documented risk to public health and safety or environmental protections. CPCA concludes that this bill will ensure health centers can successfully meet rising inflationary costs and continue providing innovative, quality, community-based, equitable care to their 7.7 million patients.

Arguments in Opposition

There is no known opposition to this bill.

FISCAL COMMENTS

According to the Assembly Appropriations Committee, HCAI estimates costs of approximately $193,000 in fiscal year (FY) 2025-26 and $202,000 in FY 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop, and repeal, or propose for adoption, building standards specific to primary care clinics in a future Title 24 Code Adoption Cycle, and participation with the Community Clinics Advisory Committee, the Hospital Building Safety Board, and public stakeholder meetings.

VOTES

SENATE FLOOR: 37-0-3

YES: Alvarado-Gil, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ABS, ABST OR NV: Allen, Archuleta, Newman

ASM HEALTH: 16-0-0

YES: Bonta, Waldron, Aguiar-Curry, Arambula, Jackson, Flora, Haney, Jones-Sawyer, Maienschein, McCarty, Joe Patterson, Rodriguez, Sanchez, Santiago, Schiavo, Weber

ASM APPROPRIATIONS: 14-0-1

YES: Wicks, Sanchez, Arambula, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Grayson, Haney, Hart, Pellerin, Ta, Villapudua

ABS, ABST OR NV: Jim Patterson

UPDATED

VERSION: March 20, 2024

CONSULTANT: Lara Flynn / HEALTH / (916) 319-2097 FN: 0004049

Date of Hearing: August 7, 2024

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

SBPCA Bill Id:SB 1382

Author:(Glazer) – As Amended Ver:March 20, 2024

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

SUMMARY:

This bill prohibits the construction standards for a licensed community clinic or rural health clinic from being more restrictive or comprehensive than construction standards for a clinic that is exempt from licensure. The bill also repeals a provision of law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards applied to licensed clinics.

FISCAL EFFECT:

The Department of Health Care Access and Information (HCAI) estimates costs of approximately $193,000 in fiscal year (FY) 2025-26 and $202,000 in FY 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop, and repeal, or propose for adoption, building standards specific to primary care clinics in a future Title 24 Code Adoption Cycle, and participation with the Community Clinics Advisory Committee, the Hospital Building Safety Board, and public stakeholder meetings.

COMMENTS:

1. Purpose. According to the author:

This bill right-sizes building and construction standards that Primary Care Clinics (PCC) must comply with by allowing these clinics to follow their city and county clinic building standards, like federal clinics and doctor’s offices, rather than more onerous OSHPD 3 standards. OSHPD 3 standards require more complex electrical, plumbing, ventilation and mechanical systems. These standards are more appropriate for hospital clinics because 25% of their care can be inpatient services, where a hospital admits a patient overnight. In comparison, PCCs only provide primary care outpatient services, like reproductive care and wellness checkups. This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our state’s most vulnerable and underserved rural and urban populations.

1. Background. While primary care clinics are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet building code requirements known as OSHPD 3 requirements. OSHPD 3 requirements apply to primary care clinics and outpatient clinical services of a hospital, but not to unlicensed settings, such as intermittent clinics or doctor’s offices. In the triennial building code cycle that resulted in the publication of the 2013 building codes, OSHPD (now HCAI) pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a large change that added minimum space requirements for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, and many other building code requirements related to electrical, mechanical, and plumbing systems. The change led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic or outpatient facility.

The California Primary Care Association surveyed its member clinics in 2017 and learned the most difficult requirements of OSHPD 3 were related to mechanical ventilation. The average increase in project costs was 112%, and one clinic reported it had not opened a new facility in an area of high demand because of the costs of complying with OSHPD 3.

This bill applies the same building code standards that apply to county clinics to all licensed clinics. Because county clinics are exempt from licensure, they are exempt from OSHPD 3. According to HCAI, settings that are exempt from OSHPD 3, such as medical office buildings and county clinics, still have to meet all other state and local building code requirements that apply to office buildings generally, but are not subject to healthcare-specific standards adopted by HCAI.

Avoiding the need to comply with OSHPD 3 requirements was one of the primary motivating factors for the recent expansion in the number of hours an “intermittent clinic” could be open and still be exempt from licensure (and therefore exempt from compliance with OSHPD 3). Legislation in 2015 increased the hours that an intermittent clinic could be open, from 20 to 30 hours per week, and, in 2018, the limit was increased a second time, to 40 hours per week.

A provision in statute prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. The author notes hospital-based clinical settings may provide as much as 25% of care to inpatients, who are typically of a higher acuity level than those seen at primary care clinics. Existing law requires a free-standing primary care clinic that is unaffiliated with a hospital and will never provide inpatient services to meet more stringent building standards applied to facilities that must be prepared to provide inpatient services. According to the author, this statutory link prevents HCAI from modifying its primary care clinic standards to the appropriate acuity level for a primary care setting. The author and California Primary Care Association point out that private physician offices, and even county clinics—which are exempt from licensure—are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a primary care clinic acquires such an unlicensed setting, the acquired clinic is required to meeting OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3. This bill repeals the limiting statute.

Analysis Prepared by: Allegra Kim / APPR. / (916) 319-2081

Date of Hearing: June 18, 2024

ASSEMBLY COMMITTEE ON HEALTH

Mia Bonta, Chair

SBPCA Bill Id:SB 1382

Author:(Glazer) – As Amended Ver:March 20, 2024

SENATE VOTE: 37-0

SUBJECT: Community and rural health clinics: building standards.

SUMMARY: Prohibits construction standards for community clinics or rural health clinics, as defined, established by the Department of Health Care Access and Information (HCAI) and established or applied by a city or county, from being more restrictive than comparable construction standards established or otherwise applied to clinics exempt from licensure. Repeals a provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards established, or otherwise applied, to licensed clinics.

EXISTING LAW:

1. Licenses and regulates clinics, including primary care clinics (PCCs) and specialty clinics, by the Department of Public Health (DPH). [Health and Safety Code (HSC) §1200, et seq.]
2. Defines a PCC as either a “community clinic,” which is required to be operated by a non-profit corporation and to use a sliding fee scale to charge patients based on their ability to pay, or, as a “free clinic,” which is also required to be operated by a non-profit but is not allowed to directly charge patients for services rendered or for any drugs, medicines, or apparatuses furnished. [HSC §1204]
3. Exempts various types of clinics from licensure and regulation by DPH, including the following:
   1. Any place or establishment operated as a clinic or office by one or more licensed health care practitioners and used as an office for the practice of their profession, within the scope of their license;
   2. Clinics operated by the federal government, the state, counties, cities, or federally recognized Indian tribes on tribal land;
   3. A clinic operated by any institution of learning that teaches a healing art;
   4. Medical foundation clinics; and,
   5. The offices of physicians in group practice who provide the preponderance of their services to members of a health plan. [HSC §1206]
4. Exempts from DPH licensure an intermittent clinic that is operated by a licensed primary care community clinic on separate premises from the licensed clinic and is only open for limited services of no more than 40 hours each week. Requires an intermittent clinic operated under this exemption to meet all other requirements of law, including administrative regulations and requirements, pertaining to fire and life safety. [HSC §1206(h)]
5. Requires HCAI, in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for the physical plant of clinics as found in the California Building Standards Code, known as “OSHPD 3,” because it is regulated by the Office of Statewide Hospital Planning and Development (OSHPD) within HCAI. [HSC §1226(b)]
6. Prohibits the construction standards for buildings where outpatient clinical services of a hospital are provided, that is separate from a building in which hospital services are provided, from being more restrictive or comprehensive than the building standards established for licensed clinics. Limits these buildings from providing more than 25% of the total outpatient services to inpatients of the hospital. [HSC §129725, §129885]
7. Establishes the Community Clinics Advisory Committee (committee), which is required to meet on an ad hoc basis and to be comprised of at least 15 individuals who are employed by, or under contract to provide service to, a community clinic on a full-time basis, either directly or as a representative of a clinic association. Requires members of the committee to be appointed by the three statewide primary clinic associations in California that represent the greatest number of community or free clinic sites. [HSC §1226.2]
   

FISCAL EFFECT: According to the Senate Appropriations Committee, HCAI estimates costs of $192,590 in 2025-26 and $201,590 in 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop, and repeal or propose for adoption building standards specific to PCCs in a future Title 24 Code Adoption Cycle. Participation with the committee, the Hospital Building Safety Board, as well as public stakeholder meetings would be required to develop the building standards.

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, this bill right-sizes building and construction standards that PCCs must comply with by allowing these clinics to follow their city and county clinic building standards, like federal clinics and doctor’s offices, rather than more onerous OSHPD 3 standards. OSHPD 3 standards require more complex electrical, plumbing, ventilation, and mechanical systems. These standards are more appropriate for hospital clinics because 25% of their care can be inpatient services, where a hospital admits a patient overnight. In comparison, PCCs only provide primary care outpatient services, like reproductive care and wellness checkups. This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our states most vulnerable and underserved rural and urban populations. The author notes that over 1,270 PCCs provide critical, high-quality healthcare services to more than one in five Californians, regardless of their ability to pay, immigration status, or other individual circumstances. The author concludes that current law requires PCCs to adhere to the same building and property acquisition standards as their larger in-patient counterparts, hindering their ability to grow and meet the needs of their communities.
2. BACKGROUND.
   1. OSHPD 3 building code requirements vs. building requirements for unlicensed clinic settings. While PCCs are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet certain building code requirements, known as OSHPD 3 requirements. In addition to PCCs, OSHPD 3 requirements also apply to outpatient clinical services of a hospital, but do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics, or doctor’s offices. Building codes are updated on a triennial basis, and for a long time, the changes to OSHPD 3 requirements were modest and minor. In the triennial cycle that resulted in the publication of the 2013 building codes, however, OSHPD pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a big change in requirements, and led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic/outpatient facility.
      
      OSHPD 3 requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to a survey that the California Primary Care Association conducted of its member clinics in 2017, the most difficult requirements of OSHPD 3 were related to mechanical ventilation requirements. Clinics reported that the average increase in project costs was 112%, and one clinic reported that it had specifically not opened a new facility in an area of high demand for services, due to the costs of complying with OSHPD 3. According to HCAI’s OSHPD 3 checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with OSHPD 3 and other applicable building code requirements. However, HCAI’s checklist states that existing clinic facilities that have architectural conditions, such as room size or corridor width, that fail to meet the requirements of OSHPD 3 but were compliant at the time of their construction, may be considered acceptable, even if the clinical space is being reused under a new tenant/owner, if the use does not change.

This bill seeks to apply the same building code standards that currently apply to county clinics to all licensed clinics. Because county clinics are exempt from licensure (as noted in 3) c) of existing law, above), they are exempt from OSHPD 3. According to OSHPD, settings that are exempt from OSHPD 3, such as medical office buildings and county clinics, still have to meet all other state and local building code requirements that apply to office buildings generally, but are not subject to healthcare-specific standards adopted by HCAI.

The ability to avoid having to comply with OSHPD 3 requirements was one of the motivating factors for the recent expansion in the number of hours an “intermittent clinic” could be open and still be exempt from licensure (and therefore exempt from compliance with OSHPD 3). As noted in Previous Legislation below, legislation in 2015 increased the hours that an intermittent clinic could be open from 20 to 30 hours per week, and in 2018, it was increased a second time to 40 hours per week.

• 1. Standards for PCCs linked to those of hospital-based clinics. As noted above, OSHPD 3 requirements apply to clinics that are licensed by DPH, including PCCs, as well as outpatient clinical services that are part of a hospital’s license. There is a provision of law that prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. However, as the author points out, hospital-based clinical settings can provide as much as 25% of their care to inpatients, which are typically of a higher acuity level than those seen at PCCs. As stated by HCAI, current statute “requires free standing PCCs, that are unaffiliated with a hospital and that will never provide inpatient services, to nonetheless meet higher building standards applied to facilities that must be prepared to provide inpatient services.” The author argues that this statutory link is what is stopping HCAI from modifying their PCC standards to the appropriate acuity level for a primary care setting. The author and sponsor point out that private physician offices, and even county clinics, since they are exempt from licensure, are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a PCC acquires one of these unlicensed settings, they are required to meeting OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3.
  2. Community Clinics Advisory Committee (CAC). Under existing law, OSHPD 3 requirements are required to be established by HCAI “in consultation with the Community CAC.” However, the CAC had not been convened when the 2013 update to OSHPD 3 (which caused concern among the clinic community) was adopted. It has since been convened, and HCAI states the CAC has been meeting for approximately four years and continues to meet quarterly. With HCAI’s guidance, the CAC has worked to better align the needs of PCCs when they are converting an existing clinic or clinic building into an OSHPD 3 building. As part of this effort, HCAI has restructured the Plan of Modernization (POM) program to be more flexible with the sequencing of achieving OSHPD 3 compliance. The POM program allows clinics three years to meet OSHPD 3 standards and operate as a clinic while they correct any deficiencies. This means that the clinic space can be put in operation prior to completion of the work necessary to bring it into compliance. With the revisions to the POM, the path to meet OSHPD 3 has more flexibility to achieve compliance. The revisions also allow PCCs to know what is expected, which in turn, helps estimate the costs prior to acquiring or leasing an existing space for their clinical needs.

HCAI states that it has also restructured the clinic checklists and guides providing local jurisdictions more guidance when reviewing existing clinics that are converting into an OSHPD 3 setting. These revisions include providing a tolerance or some limited flexibility with OSHPD 3 requirements for existing room sizes and some utilities.

• 1. Affiliate clinic licensure. SB 442 (Ducheny), Chapter 502, Statutes of 2010, streamlined provisions related to PCC affiliate licensure. Under SB 442, a PCC that has held a license for five years with no history of repeated or uncorrected violations can apply for an “affiliate clinic” license to establish a PCC at an additional site. An affiliate license application does not require an initial onsite survey, and is a more simplified and streamlined process than applying for a new stand-alone license. Additionally, PCCs operating under a single corporation utilizing the affiliate licensing option are entitled to consolidate certain administrative functions such as billing and related financial functions, purchasing functions, and offsite storage and maintenance of certain patient and personnel records. However, affiliate clinic sites must still provide evidence of compliance with OSHPD 3.

1. SUPPORT. The California Primary Care Association (CPCA) supports this bill and states that it modernizes licensing and building standard requirements for community health centers (CHCs) while continuing to provide necessary patient protection by tying requirements to the existing standards for county clinics. Current building standards apply to both CHCs, and clinical services of a general acute care hospital. This is problematic because in the CHC setting only outpatient services are provided, while hospital clinics are allowed to provide up to 25% of their care as inpatient services. Subsequently these standards are tailored to address the higher acuity needs of inpatient services allowed for hospital-based clinics. Existing law is stopping the state from modifying CHC standards to the appropriate acuity level for a primary care outpatient clinic setting. As a critical component to California’s healthcare delivery system, CHCs provide quality healthcare services to low-income individuals and families that are often uninsured or underinsured or living in healthcare deserts. Current standards result in barriers to access patient care because CHCs are required to utilize funds for unnecessary construction costs rather than expanding healthcare services or opening additional clinics in underserved communities. Private physician offices and county clinics who provide the same services as CHCs, currently operate outside of the hospital-based construction requirements without any documented risk to public health and safety or environmental protections. CPCA concludes that this bill will ensure health centers can successfully meet rising inflationary costs and continue providing innovative, quality, community-based, equitable care to their 7.7 million patients.
2. PREVIOUS LEGISLATION.
   1. AB 1612 (Pacheco) of 2023 would have permitted a PCC, with a license in good standing for the preceding five years, to construct a new outpatient clinic, acquire ownership or control of an accredited outpatient setting, acquire ownership or control of a license-exempt clinic or office, or acquire ownership or control of a previously licensed PCC, and deems these constructed or acquired facilities to be compliant with the minimum construction standards of adequacy and safety known as OSHPD 3 building code requirements. AB 1612 was vetoed by the Governor, who stated:

“I support the author’s goal to encourage the expansion of PCCs to increase their capacity to provide care. However, this bill removes important health and safety protections for patients, clinic staff, and the public. Every PCC, regardless of location, should meet the applicable state licensing standards and building codes. This bill exempts certain facilities from those safety measures.”

• 1. SB 779 (Stern), Chapter 505, Statutes of 2023, adds intermittent clinics that are exempt from licensure to an existing requirement that clinics file an annual report to HCAI with specified information. Additionally, creates new reporting requirements for all PCCs, including intermittent clinics, to report various types of data to HCAI, including a labor report and a workforce development report.
  2. AB 899 (Wood) of 2019 proposed to exempt buildings acquired by a licensed PCC under either the affiliate licensure process or the consolidated licensure process from the requirement to meet minimum construction standards of adequacy and safety, known as OSHPD 3, if the building, prior to being acquired, was an outpatient setting or a previously licensed PCC that was actively seeing patient within the previous 18 months. AB 899 was vetoed by the Governor, who stated:
     
     “This bill would eliminate the primary clinic licensure process for certain acquired clinics. I support the stated goal of this bill, which is to encourage an increase in the number of primary clinics in California; however, the bill's proposed method for accomplishing that goal removes important health and safety protections for patients, clinic staff, and the public.”
  3. AB 2204 (Gray), Chapter 279, Statutes of 2018, extends the limit on the number of hours an intermittent PCC can operate, from 30 to 40 hours per week, and still be exempt from licensure.
  4. AB 2053 (Gonzalez and Gray), Chapter 639, Statutes of 2016, requires DPH, upon written notification by a licensed PCC or an affiliate clinic that it is adding an additional physical plant maintained and operated on separate premises, to issue a single consolidated license to the clinic.
  5. AB 1130 (Gray), Chapter 412, Statutes of 201,5 expands the licensure exemption for intermittent clinics that are operated by licensed clinics on separate premises by permitting these intermittent clinics to be open for up to 30 hours per week, instead of only 20 hours per week.
  6. AB 941 (Wood), Chapter 502, Statutes of 2015, expanded a licensure exemption for tribal clinics, which were previously exempted if located on tribal land, by exempting tribal clinics regardless of the location of the clinic, if the clinic is operated under a contract with the U.S. pursuant to the Indian Self-Determination and Education Assistance Act.
  7. SB 442 streamlined the administrative requirements for a clinic corporation to apply for licensure for an affiliate PCC.
  8. SB 937 (Ducheny), Chapter 602, Statutes of 2003, revised provisions relating to the licensure and operation of PCCs; permitted a PCC to add a service or remodel a site without first having to apply for a new license from DPH; and, required DPH to issue an affiliate license to a PCC to allow it to open a clinic at an additional site, under specified conditions.

1. POLICY COMMENT. The burden and costs of compliance with OSHPD 3 building requirements for licensed clinics, and the lack of this requirement for primary care settings that are exempt from clinic licensure has been an ongoing issue before the Legislature, as illustrated in Previous Legislation, above. Because OSHPD 3 only applies to clinics that are required to obtain a license from DPH, various work-arounds have been proposed, including expanding the number of hours that an “intermittent clinic” (which is an additional location operated by clinic that has a licensed site at another location) could operate and still be exempt from needing a license. More recently, AB 1612 and AB 899 sought to exempt existing clinic buildings from OSHPD 3.
   
   Both of these bills were vetoed by the Governor who stated that they removed important health and safety protections for patients and clinic staff. While this bill uses different language (tying building standards to those that apply to county clinics that are exempt from licensure and therefore exempt from OSHPD 3) the end result is the same: exempting licensed clinics from OSHPD 3. However, Section 2 of this bill, which was included in AB 1612, removes the requirement that licensed clinics have the same building standard requirements as hospital-based clinics that might see patients with a higher acuity level. This provision, rather than exempting clinics from a standard, would give HCAI the discretion to reduce standards for community clinics without reducing standards for hospital-based clinics, and potentially avoid a Governors’ veto. Moving forward, the author may wish to consider amending this bill to remove Section 1.

REGISTERED SUPPORT / OPPOSITION:

Support

Alameda Health Consortium - San Leandro, CA

APLA Health

Arroyo Vista Family Health Center

Asian Americans for Community Involvement

Asian Health Services

CA Partnership for Health

Central Valley Health Network

Chapa-De Indian Health

CommuniCare+OLE

Community Clinic Association of Los Angeles County (CCALAC)

CPCA Advocates, Subsidiary of The California Primary Care Association

Dientes Community Dental

El Proyecto Del Barrio, INC.

Elica Health Centers

Family Health Care Centers of Greater Los Angeles, INC.

Family Health Centers of San Diego

Friends of Family Health Center

Golden Valley Health Centers

Health Alliance of Northern California

Health and Life Organization, Inc.

Health Center Partners of Southern California

Hill Country Community Clinic

Hurtt Family Health Clinic

Inland Family Community Health Center

Lifelong Medical Care

Neighborhood Healthcare

North Coast Clinics Network

North East Medical Services

Northeast Valley Health Corporation

Saban Community Clinic

Samuel Dixon Family Health Center, INC.

San Diego Regional Chamber of Commerce

San Francisco Community Clinic Consortium

San Ysidro Health

Santa Rosa Community Health

Share Ourselves

Shasta Community Health Center

Sierra Family Health Center

St. John's Community Health

St. Jude Neighborhood Health Center

Tarzana Treatment Centers, INC.

TCC Family Health

Tiburcio Vasquez Health Center, INC.

TrueCare

Opposition

None on file.

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

 THIRD READING  

Bill No: SB 1382

Author: Glazer (D)

Amended: 3/20/24

Vote: 21

SENATE HEALTH COMMITTEE: 11-0, 4/22/24

AYES: Roth, Nguyen, Glazer, Gonzalez, Grove, Hurtado, Limón, Menjivar, Rubio, Smallwood-Cuevas, Wiener

SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/16/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

SUBJECT: Community and rural health clinics: building standards

SOURCE: Author

DIGEST:

This bill prohibits the construction standards for a licensed community clinic from being more restrictive or comprehensive than comparable construction standards that are applied to county clinics that are exempt from licensure. Repeals a provision of law prohibiting building standards for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards applied to licensed clinics.

ANALYSIS:

Existing law:

1. Licenses and regulates clinics, including primary care clinics and specialty clinics, by the California Department of Public Health (CDPH), and defines a primary care clinic as either a “community clinic,” which is required to be operated by a non-profit corporation and to use a sliding fee scale to charge patients based on their ability to pay, or a “free clinic,” which is also required to be operated by a non-profit but is not allowed to directly charge patients for services rendered or for any drugs, medicines, or apparatuses furnished. [HSC §1200 et seq., §1204]
2. Exempts various types of clinics from licensure and regulation by CDPH, including the following: any place or establishment operated as a clinic or office by one or more licensed health care practitioners and used as an office for the practice of their profession, within the scope of their license; clinics operated by the federal government, the state, counties, cities, or federally recognized Indian tribes on tribal land; a clinic operated by any institution of learning that teaches a healing art; medical foundation clinics; and, the offices of physicians in group practice who provide the preponderance of their services to members of a health plan. [HSC §1206]
3. Exempts from CDPH licensure an intermittent clinic that is operated by a licensed primary care community clinic on separate premises from the licensed clinic and is only open for limited services of no more than 40 hours each week. However, an intermittent clinic operated under this exemption is still required to meet all other requirements of law, including administrative regulations and requirements, pertaining to fire and life safety. [HSC §1206(h)]
4. Requires the Department of Health Care Access and Information (HCAI), in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for the physical plant of clinics as found in the California Building Standards Code. This is known as “OSHPD 3,” because it is regulated by the Office of Statewide Hospital Planning and Development (OSHPD) within HCAI. [HSC §1226(b)]
5. Prohibits the construction standards for buildings where outpatient clinical services of a hospital are provided that is separate from a building in which hospital services are provided from being more restrictive or comprehensive than the building standards established for licensed clinics. Limits these buildings from providing more than 25% of the total outpatient services to inpatients of the hospital. [HSC §129725, §129885]
6. Establishes the Community Clinics Advisory Committee, which is required to meet on an ad hoc basis and to be comprised of at least 15 individuals who are employed by, or under contract to provide service to, a community clinic on a full-time basis, either directly or as a representative of a clinic association. Requires members of the committee to be appointed by the three statewide primary clinic associations in California that represent the greatest number of community or free clinic sites. [HSC §1226.2]

This bill:

1. Prohibits the construction standards for the construction or alteration of a community clinic or a rural health clinic, as defined, established under specified provisions of existing law or applied by a city or county, from being more restrictive or comprehensive than comparable construction standards established, or otherwise applied, to clinics that are exempt from licensure because they are operated by a governmental entity, such as a county clinic.
2. Repeals a provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards established, or otherwise applied, to licensed clinics.

Comments

1. Author’s statement. According to the author, “this bill right-sizes building and construction standards that primary care clinics must comply with by allowing these clinics to follow their city and county building standards, like federal clinics and doctor’s offices, rather than more onerous OSHPD 3 standards. OSHPD 3 standards require more complex electrical, plumbing, ventilation and mechanical systems. These standards are more appropriate for hospital clinics because 25% of their care can be inpatient services, where a hospital admits a patient overnight. In comparison, primary care clinics only provide primary care outpatient services, like reproductive care and wellness checkups. This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our state’s most vulnerable and underserved rural and urban populations. Over 1,270 community clinics provide critical, high-quality healthcare services to more than 1 in 5 Californians, regardless of their ability to pay, immigration status, or other individual circumstances. Current law requires primary care clinics to adhere to the same building and property acquisition standards as their larger in-patient counterparts, hindering their ability to grow and meet the needs of their communities”.
2. OSHPD 3 building code requirements vs. building requirements for unlicensed clinic settings. While primary care clinics are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet certain building code requirements, known as OSHPD 3 requirements. In addition to primary care clinics, OSHPD 3 requirements also apply to outpatient clinical services of a hospital, but do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics, or doctor’s offices. Building codes are updated on a triennial basis, and for a long time, the changes to OSHPD 3 requirements were modest and minor. In the triennial cycle that resulted in the publication of the 2013 building codes, however, OSHPD pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a big jump up in requirements, and led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic/outpatient facility. OSHPD 3 requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to a survey that the California Primary Care Association conducted of its member clinics in 2017, the most difficult requirements of OSHPD 3 were related to mechanical ventilation requirements. Clinics reported that the average increase in project costs was 112%, and one clinic reported that it had specifically not opened a new facility in an area of high demand for services, due to the costs of complying with OSHPD 3. According to HCAI’s OSHPD 3 checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with OSHPD 3 and other applicable building code requirements. However, HCAI’s checklist states that existing clinic facilities that have architectural conditions, such as room size or corridor width, that fail to meet the requirements of OSHPD 3 but were compliant at the time of their construction, may be considered acceptable, even if the clinical space is being reused under a new tenant/owner, if the use does not change.

The premise of this bill is to apply the same building code standards that currently apply to county clinics to all licensed clinics. Because county clinics are exempt from licensure, they are exempt from OSHPD 3. According to OSHPD, settings that are exempt from OSHPD 3, such as medical office buildings and county clinics, still have to meet all other state and local building code requirements that apply to office buildings generally, but are not subject to healthcare-specific standards adopted by HCAI.

The ability to avoid having to comply with OSHPD 3 requirements was one of the primary motivating factors for the recent expansion in the number of hours an “intermittent clinic” could be open and still be exempt from licensure (and therefore exempt from compliance with OSHPD 3). Legislation in 2015 increased the hours that an intermittent clinic could be open from 20 to 30 hours per week, and in 2018, it was increased a second time to 40 hours per week.

1. Standards for primary care clinics linked to those of hospital-based clinics. As noted above, OSHPD 3 requirements apply to clinics that are licensed by CDPH, including primary care clinics, as well as outpatient clinical services that are part of a hospital’s license. There is a provision of law that prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. However, as the author points out, hospital-based clinical settings can provide as much as 25% of their care to inpatients, which are typically of a higher acuity level than those seen at primary care clinics. As stated by HCAI, current statute “requires free standing primary care clinics, that are unaffiliated with a hospital and that will never provide inpatient services, to nonetheless meet higher building standards applied to facilities that must be prepared to provide inpatient services.” The author argues that this statutory link is what is stopping HCAI from modifying their primary care clinic standards to the appropriate acuity level for a primary care setting. The author and sponsor point out that private physician offices, and even county clinics, since they are exempt from licensure, are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a primary care clinic acquires one of these unlicensed settings, they are required to meeting OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3.
2. Community Clinics Advisory Committee. Under existing law, OSHPD 3 requirements are required to be established by HCAI “in consultation with the Community Clinic Advisory Committee” (CAC). However, the CAC had not been convened when the 2013 update to OSHPD 3 (which caused concern among the clinic community) was adopted. It has since been convened, and HCAI states the CAC has been meeting for approximately four years and continues to meet quarterly. With HCAI’s guidance, the CAC has worked to better align the needs of primary care clinics when they are converting an existing clinic or clinic building into an OSHPD 3 building. As part of this effort, HCAI has restructured the Plan of Modernization (POM) program to be more flexible with the sequencing of achieving OSHPD 3 compliance. The POM program allows clinics three years to meet OSHPD 3 standards and operate as a clinic while they correct any deficiencies. This means that the clinic space can be put in operation prior to completion of the work necessary to bring it into compliance. With the revisions to the POM, the path to meet OSHPD 3 has more flexibility to achieve compliance. The revisions also allow primary care clinics to know what is expected, which in turn, helps estimate the costs prior to acquiring or leasing an existing space for their clinical needs.

HCAI states that it has also restructured the clinic checklists and guides providing local jurisdictions more guidance when reviewing existing clinics that are converting into an OSHPD 3 setting. These revisions include providing a tolerance or some limited flexibility with OSHPD 3 requirements for existing room sizes and some utilities.

Related/Prior Legislation

AB 1612 (Pacheco of 2023) would have permitted a primary care clinic, with a license in good standing for the preceding five years, to construct a new outpatient clinic, acquire ownership or control of an accredited outpatient setting, acquire ownership or control of a license-exempt clinic or office, or acquire ownership or control of a previously licensed primary care clinic, and deems these constructed or acquired facilities to be compliant with the minimum construction standards of adequacy and safety known as OSHPD 3 building code requirements. AB 1612 was vetoed by the Governor, who stated:

“I support the author’s goal to encourage the expansion of primary care clinics to increase their capacity to provide care. However, this bill removes important health and safety protections for patients, clinic staff, and the public. Every primary care clinic, regardless of location, should meet the applicable state licensing standards and building codes. This bill exempts certain facilities from those safety measures.”

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

According to the Senate Appropriations Committee:

The Department of Health Access and Information (HCAI) estimates costs of $192,590 in 2025-26 and $201,590 in 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop and repeal or propose for adoption building standards specific to primary care clinics in a future Title 24 Code Adoption Cycle. Participation with the Community Clinics Advisory Committee, the Hospital Building Safety Board, as well as public stakeholder meetings would be required to develop the building standards.

SUPPORT: (Verified 5/1/24)

Alameda Health Consortium

APLA Health

Arroyo Vista Family Health Center

Asian Americans for Community Involvement

Asian Health Services

California Partnership for Health

California Primary Care Association Advocates

Chapa-De Indian Health

CommuniCare+OLE

Community Clinic Association of Los Angeles County

Dientes Community Dental

El Proyecto Del Barrio, Inc.

Elica Health Centers

Family Health Centers of Greater Los Angeles

Family Health Centers of San Diego

Friends of Family Health Center

Golden Valley Health Centers

Health Alliance of Northern California

Health and Life Organization, Inc.

Health Center Partners of Southern California

Hill County Community Clinic

Hurtt Family Health Clinic

Inland Family Community Health Center

Lifelong Medical Center

Neighborhood Healthcare Center

North Coast Clinics Network

North East Medical Services

Northeast Valley Health Corporation

Saban Community Clinic

Samuel Dixon Family Health Center, Inc.

San Diego Regional Chamber

San Francisco Community Clinic Consort

San Ysidro Health

Santa Rosa Community Health

Share Our Selves

Shasta Community Health Center

Sierra Family Health Center

St. John’s Community Health

St. Jude Neighborhood Health Center

Tarzana Treatment Centers, Inc.

Tiburcio Vasquez Health Center, Inc.

TrueCare

Venice Family Clinic

OPPOSITION: (Verified 5/1/24)

None received

ARGUMENTS IN SUPPORT: This bill is supported by CPCA Advocates, and a long list of community health centers and related organizations. According to the CPCA Advocates, this bill will modernize licensing and building standards requirements for community health centers while continuing to provide necessary patient protection by tying requirements to the existing standards for county clinics. Current building standards apply the same standards to both community health centers and outpatient clinical services of a general acute care hospital. CPCA Advocates states that this is problematic because in the community health care setting only outpatient services are provided, while hospital clinics are allowed to provide up to 25% of their care as inpatient services. Consequently, CPCA Advocates states that these standards are tailored to address the higher acuity needs of inpatient services allowed for hospital-based clinics. Existing law is stopping the state from modifying clinic standards to the appropriate acuity level for a primary care outpatient clinic setting. CPCA Advocates states that private physician offices and county clinics who provide the same services as licensed clinics currently operate outside of the hospital-based construction requirements, without any documented risk to public health and safety. Numerous community health centers write in support with similar arguments, and state that current standards result in barriers to access patient care because community health centers are required to utilize funds for unnecessary construction costs rather than expanding healthcare services or opening additional clinics in underserved areas.

Prepared by: Vincent D. Marchand / HEALTH / (916) 651-4111

5/17/24 13:33:40

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Anna Caballero, Chair

2023 - 2024 Regular Session

SB 1382 (Glazer) - Community and rural health clinics: building standards

Bill Summary:

SB 1382 would prohibit the construction standards for a licensed community clinic from being more restrictive or comprehensive than comparable construction standards that are applied to clinics that are exempt from licensure, as specified.

Fiscal Impact:

The Department of Health Access and Information (HCAI) estimates costs of $192,590 in 2025-26 and $201,590 in 2026-27 (Hospital Building Fund). This estimate includes the expertise of a technical team to research, develop and repeal or propose for adoption building standards specific to primary care clinics in a future Title 24 Code Adoption Cycle. Participation with the Community Clinics Advisory Committee, the Hospital Building Safety Board, as well as public stakeholder meetings would be required to develop the building standards.

Background:

The HCAI prescribes minimum construction standards of adequacy and safety for the physical plant of clinics as found in the California Building Standards Code. The HCAI building requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to HCAI’s checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with building code requirements.

Licensed clinics are required to meet these HCAI building code requirements. In addition to licensed clinics, these building requirements also apply to outpatient clinical services of a hospital. Current law prohibits the construction standards for buildings where outpatient clinical services of a hospital are provided that is separate from a building in which hospital services are provided from being more restrictive or comprehensive than the building standards established for licensed clinics.

The HCAI building code requirements do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics (such as clinics operated by a governmental entity), or doctor’s offices. These unlicensed settings that are exempt from HCAI building code requirements still have to meet all other state and local building code requirements that apply to office buildings generally, but are not subject to healthcare-specific standards adopted by HCAI.

Proposed Law:

Specific provisions of the bill would:

• Prohibit the construction standards for the construction or alteration of a licensed community clinic or a rural health clinic, as defined, established under specified provisions of existing law and standards established or applied by a city or county, from being more restrictive or comprehensive than comparable construction standards established, or otherwise applied, to clinics that are exempt from licensure because they are operated by a governmental entity.
• Repeal the provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards established, or otherwise applied, to licensed clinics.

-- END --

SENATE COMMITTEE ON HEALTH

Senator Richard Roth, Chair

BILL NO: SB 1382

SUBJECT: Community and rural health clinics: building standards

SUMMARY:

Prohibits the construction standards for a licensed community clinic from being more restrictive or comprehensive than comparable construction standards that are applied to county clinics that are exempt from licensure. Repeals a provision of law prohibiting building standards for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards applied to licensed clinics.

Existing law:

1. Licenses and regulates clinics, including primary care clinics and specialty clinics, by the California Department of Public Health (CDPH). [HSC §1200, et seq.]
2. Defines a primary care clinic as either a “community clinic,” which is required to be operated by a non-profit corporation and to use a sliding fee scale to charge patients based on their ability to pay, or a “free clinic,” which is also required to be operated by a non-profit but is not allowed to directly charge patients for services rendered or for any drugs, medicines, or apparatuses furnished. [HSC §1204]
3. Exempts various types of clinics from licensure and regulation by CDPH, including the following: any place or establishment operated as a clinic or office by one or more licensed health care practitioners and used as an office for the practice of their profession, within the scope of their license; clinics operated by the federal government, the state, counties, cities, or federally recognized Indian tribes on tribal land; a clinic operated by any institution of learning that teaches a healing art; medical foundation clinics; and, the offices of physicians in group practice who provide the preponderance of their services to members of a health plan. [HSC §1206]
4. Exempts from CDPH licensure an intermittent clinic that is operated by a licensed primary care community clinic on separate premises from the licensed clinic and is only open for limited services of no more than 40 hours each week. However, an intermittent clinic operated under this exemption is still required to meet all other requirements of law, including administrative regulations and requirements, pertaining to fire and life safety. [HSC §1206(h)]
5. Requires the Department of Health Care Access and Information (HCAI), in consultation with the Community Clinics Advisory Committee, to prescribe minimum construction standards of adequacy and safety for the physical plant of clinics as found in the California Building Standards Code. This is known as “OSHPD 3,” because it is regulated by the Office of Statewide Hospital Planning and Development (OSHPD) within HCAI. [HSC §1226(b)]
6. Prohibits the construction standards for buildings where outpatient clinical services of a hospital are provided that is separate from a building in which hospital services are provided from being more restrictive or comprehensive than the building standards established for licensed clinics. Limits these buildings from providing more than 25% of the total outpatient services to inpatients of the hospital. [HSC §129725, §129885]
7. Establishes the Community Clinics Advisory Committee, which is required to meet on an ad hoc basis and to be comprised of at least 15 individuals who are employed by, or under contract to provide service to, a community clinic on a full-time basis, either directly or as a representative of a clinic association. Requires members of the committee to be appointed by the three statewide primary clinic associations in California that represent the greatest number of community or free clinic sites. [HSC §1226.2]

This bill:

1. Prohibits the construction standards for the construction or alteration of a community clinic or a rural health clinic, as defined, established under specified provisions of existing law or applied by a city or county, from being more restrictive or comprehensive than comparable construction standards established, or otherwise applied, to clinics that are exempt from licensure because they are operated by a governmental entity, such as a county clinic.
2. Repeals a provision of existing law prohibiting building standards for the construction or alteration of buildings used for outpatient clinical services of a hospital from being more restrictive or comprehensive than comparable building standards established, or otherwise applied, to licensed clinics.

FISCAL EFFECT:

This bill has not been analyzed by a fiscal committee.

COMMENTS:

1. Author’s statement. According to the author, this bill right-sizes building and construction standards that primary care clinics must comply with by allowing these clinics to follow their city and county building standards, like federal clinics and doctor’s offices, rather than more onerous OSHPD 3 standards. OSHPD 3 standards require more complex electrical, plumbing, ventilation and mechanical systems. These standards are more appropriate for hospital clinics because 25% of their care can be inpatient services, where a hospital admits a patient overnight. In comparison, primary care clinics only provide primary care outpatient services, like reproductive care and wellness checkups. This bill ensures that patient safety is not jeopardized while reducing barriers preventing the expansion of crucial healthcare services to our state’s most vulnerable and underserved rural and urban populations. Over 1,270 community clinics provide critical, high-quality healthcare services to more than 1 in 5 Californians, regardless of their ability to pay, immigration status, or other individual circumstances. Current law requires primary care clinics to adhere to the same building and property acquisition standards as their larger in-patient counterparts, hindering their ability to grow and meet the needs of their communities.
2. OSHPD 3 building code requirements vs. building requirements for unlicensed clinic settings. While primary care clinics are not required to comply with seismic safety standards that apply to hospitals, licensed clinics are required to meet certain building code requirements, known as OSHPD 3 requirements. In addition to primary care clinics, OSHPD 3 requirements also apply to outpatient clinical services of a hospital, but do not apply to unlicensed settings, such as intermittent clinics or other exempted clinics, or doctor’s offices. Building codes are updated on a triennial basis, and for a long time, the changes to OSHPD 3 requirements were modest and minor. In the triennial cycle that resulted in the publication of the 2013 building codes, however, OSHPD pushed to bring the OSHPD 3 requirements into conformance with the national model code. The resulting update was a big jump up in requirements, and led to complaints from clinics and hospitals about the expense of expanding or purchasing a new clinic/outpatient facility. OSHPD 3 requirements include a number of specific requirements, including minimum space for examination rooms, minimum requirements for handwashing stations, specific ventilation requirements, among many others building code requirements relating to electrical, mechanical, and plumbing systems. According to a survey that the California Primary Care Association conducted of its member clinics in 2017, the most difficult requirements of OSHPD 3 were related to mechanical ventilation requirements. Clinics reported that the average increase in project costs was 112%, and one clinic reported that it had specifically not opened a new facility in an area of high demand for services, due to the costs of complying with OSHPD 3. According to HCAI’s OSHPD 3 checklist, all new buildings and additions, alterations or repairs to existing buildings, and conversion of space to a clinic use within existing buildings, are required to comply with OSHPD 3 and other applicable building code requirements. However, HCAI’s checklist states that existing clinic facilities that have architectural conditions, such as room size or corridor width, that fail to meet the requirements of OSHPD 3 but were compliant at the time of their construction, may be considered acceptable, even if the clinical space is being reused under a new tenant/owner, if the use does not change.
   
   The premise of this bill is to apply the same building code standards that currently apply to county clinics to all licensed clinics. Because county clinics are exempt from licensure, they are exempt from OSHPD 3. According to OSHPD, settings that are exempt from OSHPD 3, such as medical office buildings and county clinics, still have to meet all other state and local building code requirements that apply to office buildings generally, but are not subject to healthcare-specific standards adopted by HCAI.
   
   The ability to avoid having to comply with OSHPD 3 requirements was one of the primary motivating factors for the recent expansion in the number of hours an “intermittent clinic” could be open and still be exempt from licensure (and therefore exempt from compliance with OSHPD 3). Legislation in 2015 increased the hours that an intermittent clinic could be open from 20 to 30 hours per week, and in 2018, it was increased a second time to 40 hours per week.
3. Standards for primary care clinics linked to those of hospital-based clinics. As noted above, OSHPD 3 requirements apply to clinics that are licensed by CDPH, including primary care clinics, as well as outpatient clinical services that are part of a hospital’s license. There is a provision of law that prohibits the standards for hospital-based outpatient clinical services from being higher than those established for licensed clinics. However, as the author points out, hospital-based clinical settings can provide as much as 25% of their care to inpatients, which are typically of a higher acuity level than those seen at primary care clinics. As stated by HCAI, current statute “requires free standing primary care clinics, that are unaffiliated with a hospital and that will never provide inpatient services, to nonetheless meet higher building standards applied to facilities that must be prepared to provide inpatient services.” The author argues that this statutory link is what is stopping HCAI from modifying their primary care clinic standards to the appropriate acuity level for a primary care setting. The author and sponsor point out that private physician offices, and even county clinics, since they are exempt from licensure, are permitted to operate without meeting OSHPD 3 requirements, without any documented risk to public health and safety. If a primary care clinic acquires one of these unlicensed settings, they are required to meeting OSHPD 3 standards, even though the site was providing the same services to patients previously without complying with OSHPD 3.
4. Community Clinics Advisory Committee. Under existing law, OSHPD 3 requirements are required to be established by HCAI “in consultation with the Community Clinic Advisory Committee” (CAC). However, the CAC had not been convened when the 2013 update to OSHPD 3 (which caused concern among the clinic community) was adopted. It has since been convened, and HCAI states the CAC has been meeting for approximately four years and continues to meet quarterly. With HCAI’s guidance, the CAC has worked to better align the needs of primary care clinics when they are converting an existing clinic or clinic building into an OSHPD 3 building. As part of this effort, HCAI has restructured the Plan of Modernization (POM) program to be more flexible with the sequencing of achieving OSHPD 3 compliance. The POM program allows clinics three years to meet OSHPD 3 standards and operate as a clinic while they correct any deficiencies. This means that the clinic space can be put in operation prior to completion of the work necessary to bring it into compliance. With the revisions to the POM, the path to meet OSHPD 3 has more flexibility to achieve compliance. The revisions also allow primary care clinics to know what is expected, which in turn, helps estimate the costs prior to acquiring or leasing an existing space for their clinical needs.
   
   HCAI states that it has also restructured the clinic checklists and guides providing local jurisdictions more guidance when reviewing existing clinics that are converting into an OSHPD 3 setting. These revisions include providing a tolerance or some limited flexibility with OSHPD 3 requirements for existing room sizes and some utilities.
5. Affiliate clinic licensure. SB 442 (Ducheny, Chapter 502, Statutes of 2010) streamlined provisions related to primary care clinic affiliate licensure. Under SB 442, a primary care clinic that has held a license for five years with no history of repeated or uncorrected violations can apply for an “affiliate clinic” license to establish a primary care clinic at an additional site. An affiliate license application does not require an initial onsite survey, and is a more simplified and streamlined process than applying for a new stand-alone license. Additionally, primary care clinics operating under a single corporation utilizing the affiliate licensing option are entitled to consolidate certain administrative functions such as billing and related financial functions, purchasing functions, and offsite storage and maintenance of certain patient and personnel records. However, affiliate clinic sites must still provide evidence of compliance with OSHPD 3.
   
6. Prior legislation. AB 1612 (Pacheco of 2023) would have permitted a primary care clinic, with a license in good standing for the preceding five years, to construct a new outpatient clinic, acquire ownership or control of an accredited outpatient setting, acquire ownership or control of a license-exempt clinic or office, or acquire ownership or control of a previously licensed primary care clinic, and deems these constructed or acquired facilities to be compliant with the minimum construction standards of adequacy and safety known as OSHPD 3 building code requirements. AB 1612 was vetoed by the Governor, who stated:
   “I support the author’s goal to encourage the expansion of primary care clinics to increase their capacity to provide care. However, this bill removes important health and safety protections for patients, clinic staff, and the public. Every primary care clinic, regardless of location, should meet the applicable state licensing standards and building codes. This bill exempts certain facilities from those safety measures.”
   
   SB 779 (Stern, Chapter 505, Statutes of 2023) adds intermittent clinics that are exempt from licensure to an existing requirement that clinics file an annual report to HCAI with specified information. Additionally, creates new reporting requirements for all primary care clinics, including intermittent clinics, to report various types of data to HCAI, including a labor report and a workforce development report.
   
   AB 899 (Wood of 2019) proposed to exempt buildings acquired by a licensed primary care clinic under either the affiliate licensure process or the consolidated licensure process from the requirement to meet minimum construction standards of adequacy and safety, known as OSHPD 3, if the building, prior to being acquired, was an outpatient setting or a previously licensed primary care clinic that was actively seeing patient within the previous 18 months. AB 899 was vetoed by the Governor, who stated: “This bill would eliminate the primary clinic licensure process for certain acquired clinics. I support the stated goal of this bill, which is to encourage an increase in the number of primary clinics in California; however, the bill's proposed method for accomplishing that goal removes important health and safety protections for patients, clinic staff, and the public.”
   
   AB 2204 (Gray, Chapter 279, Statutes of 2018) extends the limit on the number of hours an intermittent primary care clinic can operate, from 30 to 40 hours per week, and still be exempt from licensure.
   
   AB 2053 (Gonzalez and Gray, Chapter 639, Statutes of 2016) requires CDPH, upon written notification by a licensed primary care clinic or an affiliate clinic that it is adding an additional physical plant maintained and operated on separate premises, to issue a single consolidated license to the clinic.
   
   AB 1130 (Gray, Chapter 412, Statutes of 2015) expands the licensure exemption for intermittent clinics that are operated by licensed clinics on separate premises by permitting these intermittent clinics to be open for up to 30 hours per week, instead of only 20 hours per week.
   
   AB 941 (Wood, Chapter 502, Statutes of 2015) expanded a licensure exemption for tribal clinics, which were previously exempted if located on tribal land, by exempting tribal clinics regardless of the location of the clinic, if the clinic is operated under a contract with the U.S. pursuant to the Indian Self-Determination and Education Assistance Act.
   
   SB 442 (Ducheny, Chapter 502, Statutes of 2010) streamlined the administrative requirements for a clinic corporation to apply for licensure for an affiliate primary care clinic.
   
   SB 937 (Ducheny, Chapter 602, Statutes of 2003) revised provisions relating to the licensure and operation of primary care clinics; permitted a primary care clinic to add a service or remodel a site without first having to apply for a new license from CDPH; and, required CDPH to issue an affiliate license to a primary care clinic to allow it to open a clinic at an additional site, under specified conditions.
7. Support. This bill is supported by CPCA Advocates, and a long list of community health centers and related organizations. According to the CPCA Advocates, this bill will modernize licensing and building standards requirements for community health centers while continuing to provide necessary patient protection by tying requirements to the existing standards for county clinics. Current building standards apply the same standards to both community health centers and outpatient clinical services of a general acute care hospital. CPCA Advocates states that this is problematic because in the community health care setting only outpatient services are provided, while hospital clinics are allowed to provide up to 25% of their care as inpatient services. Consequently, CPCA Advocates states that these standards are tailored to address the higher acuity needs of inpatient services allowed for hospital-based clinics. Existing law is stopping the state from modifying clinic standards to the appropriate acuity level for a primary care outpatient clinic setting. CPCA Advocates states that private physician offices and county clinics who provide the same services as licensed clinics currently operate outside of the hospital-based construction requirements, without any documented risk to public health and safety. Numerous community health centers write in support with similar arguments, and state that current standards result in barriers to access patient care because community health centers are required to utilize funds for unnecessary construction costs rather than expanding healthcare services or opening additional clinics in underserved areas.
8. Policy comment. The relative burden of compliance with OSHPD 3 building requirements for licensed clinics, compared to the lack of this requirement for primary care settings that are exempt from clinic licensure, has been an issue that has come before the Legislature for a number of years. Because it only applies to clinics that are required to obtain a license from CDPH, early efforts to mitigate this burden included expanding the number of hours that an “intermittent clinic,” which is an additional location operated by clinic that has a licensed site at another location, could operate and still be exempt from needing a license. More recently, AB 1612 (Pacheco of 2023) and AB 899 (Wood of 2019) both sought to exempt buildings from OSHPD 3. AB 899 would have exempted buildings acquired by a licensed clinic that had been seeing patients within the prior 18 months, either as an outpatient setting or as a previously licensed clinic. AB 1612 was more expansive, and would have permitted a primary care clinic with a license in good standing for the preceding five years, to construct a new clinic, or acquire ownership of certain medical settings that do not require licensure, and avoid OSHPD 3. Both of these bills were vetoed by the Governor on the basis that they removed important health and safety protections for patients and clinic staff. While this bill uses different language (tying building standards to those that apply to county clinics that are exempt from licensure and therefore exempt from OSHPD 3), the end result is the same: exempting licensed clinics from OSHPD 3. However, Section 2 of this bill, which was also included in AB 1612, removes the requirement that licensed clinics have the same building standard requirements as hospital-based clinics that might see patients with a higher acuity level. This provision, rather than exempting clinics from a standard, would give HCAI the discretion to reduce standards for community clinics without reducing standards for hospital-based clinics. This more modest change has never been presented to the Governor on its own, and might provide a pathway to allow HCAI to provide some regulatory relief. With the more expansive exemption included in Section 1 of this bill, it is unclear why this bill would not meet the same veto fate as AB 899 and AB 1612.

SUPPORT AND OPPOSITION:

Support: Alameda Health Consortium

APLA Health

Arroyo Vista Family Health Center

Asian Americans for Community Involvement

Asian Health Services

California Partnership for Health

California Primary Care Association Advocates

Chapa-De Indian Health

CommuniCare+OLE

Community Clinic Association of Los Angeles County

Dientes Community Dental

El Proyecto Del Barrio, Inc.

Elica Health Centers

Family Health Centers of Greater Los Angeles

Family Health Centers of San Diego

Friends of Family Health Center

Golden Valley Health Centers

Health Alliance of Northern California

Health and Life Organization, Inc.

Health Center Partners of Southern California

Hill County Community Clinic

Hurtt Family Health Clinic

Inland Family Community Health Center

Lifelong Medical Center

Neighborhood Healthcare Center

North Coast Clinics Network

North East Medical Services

Northeast Valley Health Corporation

Saban Community Clinic

Samuel Dixon Family Health Center, Inc.

Santa Rosa Community Health

San Ysidro Health

Share Our Selves

Shasta Community Health Center

Sierra Family Health Center

St. John’s Community Health

St. Jude Neighborhood Health Center

Tarzana Treatment Centers, Inc.

Tiburcio Vasquez Health Center, Inc.

TrueCare

Oppose: None received

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