Bill Text: CA SB1276 | 2013-2014 | Regular Session | Chaptered
Bill Title: Health care: fair billing policies.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2014-09-28 - Chaptered by Secretary of State. Chapter 758, Statutes of 2014. [SB1276 Detail]
Download: California-2013-SB1276-Chaptered.html
BILL NUMBER: SB 1276 CHAPTERED
BILL TEXT
CHAPTER 758
FILED WITH SECRETARY OF STATE SEPTEMBER 28, 2014
APPROVED BY GOVERNOR SEPTEMBER 28, 2014
PASSED THE SENATE AUGUST 13, 2014
PASSED THE ASSEMBLY AUGUST 11, 2014
AMENDED IN ASSEMBLY JUNE 26, 2014
AMENDED IN SENATE MAY 22, 2014
INTRODUCED BY Senator Hernandez
FEBRUARY 21, 2014
An act to amend Sections 127400, 127405, 127420, 127425, 127450,
127454, and 127455 of the Health and Safety Code, relating to health
care billing.
LEGISLATIVE COUNSEL'S DIGEST
SB 1276, Hernandez. Health care: fair billing policies.
(1) Existing law requires a hospital, as defined, to maintain an
understandable written policy regarding discount payments for
financially qualified patients as well as a written charity care
policy, and authorizes a hospital to negotiate the terms of a payment
plan with a patient. Existing law requires that uninsured patients
or patients with high medical costs who are at or below 350% of the
federal poverty level be eligible for charity care or a discount
payment policy from a hospital, as specified, and requires that
specified patients be eligible for discount payments to an emergency
physician. Existing law defines a patient with high medical costs as
a person whose family income does not exceed 350% of the federal
poverty level and who does not receive a discounted rate from the
hospital or physician as a result of his or her 3rd-party coverage.
This bill would instead require a hospital to negotiate with a
patient regarding a payment plan, taking into consideration the
patient's family income and essential living expenses. This bill
would require the hospital to use a specified formula to create a
reasonable payment plan, as defined, if the hospital and the patient
cannot agree to a payment plan. This bill would change the definition
of a person with high medical costs to include those persons who do
receive a discounted rate from the hospital as a result of 3rd-party
coverage. This bill would also require an emergency physician or his
or her assignee to use a specified formula to calculate a reasonable
payment formula when a patient is attempting to qualify for
eligibility under the emergency physician's discount payment policy.
This bill would authorize an emergency physician or his or her
assignee to rely on the determination of family income and essential
living expenses made by the hospital at which emergency care was
provided for purposes of calculating the reasonable payment formula,
and would authorize an emergency physician or his or her assignee, at
his or her discretion, to accept self-attestation of family income
and essential living expenses by a patient or a patient's legal
representative.
(2) Existing law requires a hospital or emergency physician to
make a reasonable effort to obtain from the patient, or his or her
representative, information about whether private or public health
insurance or sponsorship may fully or partially cover the charges for
care, including private health insurance, and requires the hospital
or emergency physician to provide a patient who has not shown proof
of 3rd-party coverage with specified information, including a
statement that he or she may be eligible for specified health
coverage programs, including Medi-Cal and the California Children's
Services program, and applications for those programs.
This bill would require the hospital or emergency physician to
obtain information as to whether the patient may be eligible for the
California Health Benefit Exchange and to include in the information
provided to a patient that has not shown proof of 3rd-party coverage
a statement that the consumer may be eligible for coverage through
the California Health Benefit Exchange or other state- or
county-funded health coverage programs. The bill would also specify
that when a patient applies, or has a pending application, for
another health coverage program at the same time he or she applies
for charity care or a discount payment program, that neither
application precludes eligibility for the other program.
(3) Existing law requires a hospital or an emergency physician to
have a written policy defining standards and practices for the
collection of debt, and a written agreement from any agency that
collects debt that it will adhere to the standards and practices.
This bill would require the affiliate, subsidiary, or external
collection agency that is collecting hospital or emergency physician
receivables to comply with the definition and application of a
reasonable payment plan, as defined.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 127400 of the Health and Safety Code is amended
to read:
127400. As used in this article, the following terms have the
following meanings:
(a) "Allowance for financially qualified patient" means, with
respect to services rendered to a financially qualified patient, an
allowance that is applied after the hospital's charges are imposed on
the patient, due to the patient's determined financial inability to
pay the charges.
(b) "Federal poverty level" means the poverty guidelines updated
periodically in the Federal Register by the United States Department
of Health and Human Services under authority of subsection (2) of
Section 9902 of Title 42 of the United States Code.
(c) "Financially qualified patient" means a patient who is both of
the following:
(1) A patient who is a self-pay patient, as defined in subdivision
(f), or a patient with high medical costs, as defined in subdivision
(g).
(2) A patient who has a family income that does not exceed 350
percent of the federal poverty level.
(d) "Hospital" means a facility that is required to be licensed
under subdivision (a), (b), or (f) of Section 1250, except a facility
operated by the State Department of State Hospitals or the
Department of Corrections and Rehabilitation.
(e) "Office" means the Office of Statewide Health Planning and
Development.
(f) "Self-pay patient" means a patient who does not have
third-party coverage from a health insurer, health care service plan,
Medicare, or Medicaid, and whose injury is not a compensable injury
for purposes of workers' compensation, automobile insurance, or other
insurance as determined and documented by the hospital. Self-pay
patients may include charity care patients.
(g) "A patient with high medical costs" means a person whose
family income does not exceed 350 percent of the federal poverty
level, as defined in subdivision (b). For these purposes, "high
medical costs" means any of the following:
(1) Annual out-of-pocket costs incurred by the individual at the
hospital that exceed 10 percent of the patient's family income in the
prior 12 months.
(2) Annual out-of-pocket expenses that exceed 10 percent of the
patient's family income, if the patient provides documentation of the
patient's medical expenses paid by the patient or the patient's
family in the prior 12 months.
(3) A lower level determined by the hospital in accordance with
the hospital's charity care policy.
(h) "Patient's family" means the following:
(1) For persons 18 years of age and older, spouse, domestic
partner, as defined in Section 297 of the Family Code, and dependent
children under 21 years of age, whether living at home or not.
(2) For persons under 18 years of age, parent, caretaker
relatives, and other children under 21 years of age of the parent or
caretaker relative.
(i) "Reasonable payment plan" means monthly payments that are not
more than 10 percent of a patient's family income for a month,
excluding deductions for essential living expenses. "Essential living
expenses" means, for purposes of this subdivision, expenses for any
of the following: rent or house payment and maintenance, food and
household supplies, utilities and telephone, clothing, medical and
dental payments, insurance, school or child care, child or spousal
support, transportation and auto expenses, including insurance, gas,
and repairs, installment payments, laundry and cleaning, and other
extraordinary expenses.
SEC. 2. Section 127405 of the Health and Safety Code is amended to
read:
127405. (a) (1) (A) Each hospital shall maintain an
understandable written policy regarding discount payments for
financially qualified patients as well as an understandable written
charity care policy. Uninsured patients or patients with high medical
costs who are at or below 350 percent of the federal poverty level,
as defined in subdivision (b) of Section 127400, shall be eligible to
apply for participation under a hospital's charity care policy or
discount payment policy. Notwithstanding any other provision of this
article, a hospital may choose to grant eligibility for its discount
payment policy or charity care policies to patients with incomes over
350 percent of the federal poverty level. Both the charity care
policy and the discount payment policy shall state the process used
by the hospital to determine whether a patient is eligible for
charity care or discounted payment. In the event of a dispute, a
patient may seek review from the business manager, chief financial
officer, or other appropriate manager as designated in the charity
care policy and the discount payment policy.
(B) The written policy regarding discount payments shall also
include a statement that an emergency physician, as defined in
Section 127450, who provides emergency medical services in a hospital
that provides emergency care is also required by law to provide
discounts to uninsured patients or patients with high medical costs
who are at or below 350 percent of the federal poverty level. This
statement shall not be construed to impose any additional
responsibilities upon the hospital.
(2) Rural hospitals, as defined in Section 124840, may establish
eligibility levels for financial assistance and charity care at less
than 350 percent of the federal poverty level as appropriate to
maintain their financial and operational integrity.
(b) A hospital's discount payment policy shall clearly state
eligibility criteria based upon income consistent with the
application of the federal poverty level. The discount payment policy
shall also include an extended payment plan to allow payment of the
discounted price over time. The policy shall provide that the
hospital and the patient shall negotiate the terms of the payment
plan, and take into consideration the patient's family income and
essential living expenses. If the hospital and the patient cannot
agree on the payment plan, the hospital shall use the formula
described in subdivision (i) of Section 127400 to create a reasonable
payment plan.
(c) The charity care policy shall state clearly the eligibility
criteria for charity care. In determining eligibility under its
charity care policy, a hospital may consider income and monetary
assets of the patient. For purposes of this determination, monetary
assets shall not include retirement or deferred compensation plans
qualified under the Internal Revenue Code, or nonqualified deferred
compensation plans. Furthermore, the first ten thousand dollars
($10,000) of a patient's monetary assets shall not be counted in
determining eligibility, nor shall 50 percent of a patient's monetary
assets over the first ten thousand dollars ($10,000) be counted in
determining eligibility.
(d) A hospital shall limit expected payment for services it
provides to a patient at or below 350 percent of the federal poverty
level, as defined in subdivision (b) of Section 127400, eligible
under its discount payment policy to the amount of payment the
hospital would expect, in good faith, to receive for providing
services from Medicare, Medi-Cal, the Healthy Families Program, or
another government-sponsored health program of health benefits in
which the hospital participates, whichever is greater. If the
hospital provides a service for which there is no established payment
by Medicare or any other government-sponsored program of health
benefits in which the hospital participates, the hospital shall
establish an appropriate discounted payment.
(e) A patient, or patient's legal representative, who requests a
discounted payment, charity care, or other assistance in meeting his
or her financial obligation to the hospital shall make every
reasonable effort to provide the hospital with documentation of
income and health benefits coverage. If the person requests charity
care or a discounted payment and fails to provide information that is
reasonable and necessary for the hospital to make a determination,
the hospital may consider that failure in making its determination.
(1) For purposes of determining eligibility for discounted
payment, documentation of income shall be limited to recent pay stubs
or income tax returns.
(2) For purposes of determining eligibility for charity care,
documentation of assets may include information on all monetary
assets, but shall not include statements on retirement or deferred
compensation plans qualified under the Internal Revenue Code, or
nonqualified deferred compensation plans. A hospital may require
waivers or releases from the patient or the patient's family,
authorizing the hospital to obtain account information from financial
or commercial institutions, or other entities that hold or maintain
the monetary assets, to verify their value.
(3) Information obtained pursuant to paragraph (1) or (2) shall
not be used for collections activities. This paragraph does not
prohibit the use of information obtained by the hospital, collection
agency, or assignee independently of the eligibility process for
charity care or discounted payment.
(4) Eligibility for discounted payments or charity care may be
determined at any time the hospital is in receipt of information
specified in paragraph (1) or (2), respectively.
SEC. 3. Section 127420 of the Health and Safety Code is amended to
read:
127420. (a) Each hospital shall make all reasonable efforts to
obtain from the patient or his or her representative information
about whether private or public health insurance or sponsorship may
fully or partially cover the charges for care rendered by the
hospital to a patient, including, but not limited to, any of the
following:
(1) Private health insurance, including coverage offered through
the California Health Benefit Exchange.
(2) Medicare.
(3) The Medi-Cal program, the Healthy Families Program, the
California Children's Services program, or other state-funded
programs designed to provide health coverage.
(b) If a hospital bills a patient who has not provided proof of
coverage by a third party at the time the care is provided or upon
discharge, as a part of that billing, the hospital shall provide the
patient with a clear and conspicuous notice that includes all of the
following:
(1) A statement of charges for services rendered by the hospital.
(2) A request that the patient inform the hospital if the patient
has health insurance coverage, Medicare, Healthy Families Program,
Medi-Cal, or other coverage.
(3) A statement that, if the consumer does not have health
insurance coverage, the consumer may be eligible for Medicare,
Healthy Families Program, Medi-Cal, coverage offered through the
California Health Benefit Exchange, California Children's Services
program, other state- or county-funded health coverage, or charity
care.
(4) A statement indicating how patients may obtain applications
for the Medi-Cal program and the Healthy Families Program, coverage
offered through the California Health Benefit Exchange, or other
state- or county-funded health coverage programs and that the
hospital will provide these applications. The hospital shall also
provide patients with a referral to a local consumer assistance
center housed at legal services offices. If the patient does not
indicate coverage by a third-party payer specified in subdivision (a)
or requests a discounted price or charity care, then the hospital
shall provide an application for the Medi-Cal program, the Healthy
Families Program, or other state- or county-funded health coverage
programs. This application shall be provided prior to discharge if
the patient has been admitted or to patients receiving emergency or
outpatient care.
(5) Information regarding the financially qualified patient and
charity care application, including the following:
(A) A statement that indicates that if the patient lacks, or has
inadequate, insurance, and meets certain low- and moderate-income
requirements, the patient may qualify for discounted payment or
charity care.
(B) The name and telephone number of a hospital employee or office
from whom or which the patient may obtain information about the
hospital's discount payment and charity care policies, and how to
apply for that assistance.
(C) If a patient applies, or has a pending application, for
another health coverage program at the same time that he or she
applies for a hospital charity care or discount payment program,
neither application shall preclude eligibility for the other program.
SEC. 4. Section 127425 of the Health and Safety Code is amended to
read:
127425. (a) Each hospital shall have a written policy about when
and under whose authority patient debt is advanced for collection,
whether the collection activity is conducted by the hospital, an
affiliate or subsidiary of the hospital, or by an external collection
agency.
(b) Each hospital shall establish a written policy defining
standards and practices for the collection of debt, and shall obtain
a written agreement from any agency that collects hospital
receivables that it will adhere to the hospital's standards and scope
of practices. This agreement shall require the affiliate,
subsidiary, or external collection agency of the hospital that
collects the debt to comply with the hospital's definition and
application of a reasonable payment plan, as defined in subdivision
(i) of Section 127400. The policy shall not conflict with other
applicable laws and shall not be construed to create a joint venture
between the hospital and the external entity, or otherwise to allow
hospital governance of an external entity that collects hospital
receivables. In determining the amount of a debt a hospital may seek
to recover from patients who are eligible under the hospital's
charity care policy or discount payment policy, the hospital may
consider only income and monetary assets as limited by Section
127405.
(c) At time of billing, each hospital shall provide a written
summary consistent with Section 127410, which includes the same
information concerning services and charges provided to all other
patients who receive care at the hospital.
(d) For a patient that lacks coverage, or for a patient that
provides information that he or she may be a patient with high
medical costs, as defined in this article, a hospital, any assignee
of the hospital, or other owner of the patient debt, including a
collection agency, shall not report adverse information to a consumer
credit reporting agency or commence civil action against the patient
for nonpayment at any time prior to 150 days after initial billing.
(e) If a patient is attempting to qualify for eligibility under
the hospital's charity care or discount payment policy and is
attempting in good faith to settle an outstanding bill with the
hospital by negotiating a reasonable payment plan or by making
regular partial payments of a reasonable amount, the hospital shall
not send the unpaid bill to any collection agency or other assignee,
unless that entity has agreed to comply with this article.
(f) (1) The hospital or other assignee that is an affiliate or
subsidiary of the hospital shall not, in dealing with patients
eligible under the hospital's charity care or discount payment
policies, use wage garnishments or liens on primary residences as a
means of collecting unpaid hospital bills.
(2) A collection agency or other assignee that is not a subsidiary
or affiliate of the hospital shall not, in dealing with any patient
under the hospital's charity care or discount payment policies, use
as a means of collecting unpaid hospital bills, any of the following:
(A) A wage garnishment, except by order of the court upon noticed
motion, supported by a declaration filed by the movant identifying
the basis for which it believes that the patient has the ability to
make payments on the judgment under the wage garnishment, which the
court shall consider in light of the size of the judgment and
additional information provided by the patient prior to, or at, the
hearing concerning the patient's ability to pay, including
information about probable future medical expenses based on the
current condition of the patient and other obligations of the
patient.
(B) Notice or conduct a sale of the patient's primary residence
during the life of the patient or his or her spouse, or during the
period a child of the patient is a minor, or a child of the patient
who has attained the age of majority is unable to take care of
himself or herself and resides in the dwelling as his or her primary
residence. In the event a person protected by this paragraph owns
more than one dwelling, the primary residence shall be the dwelling
that is the patient's current homestead, as defined in Section
704.710 of the Code of Civil Procedure, or was the patient's
homestead at the time of the death of a person other than the patient
who is asserting the protections of this paragraph.
(3) This requirement does not preclude a hospital, collection
agency, or other assignee from pursuing reimbursement and any
enforcement remedy or remedies from third-party liability
settlements, tortfeasors, or other legally responsible parties.
(g) Extended payment plans offered by a hospital to assist
patients eligible under the hospital's charity care policy, discount
payment policy, or any other policy adopted by the hospital for
assisting low-income patients with no insurance or high medical costs
in settling outstanding past due hospital bills, shall be interest
free. The hospital extended payment plan may be declared no longer
operative after the patient's failure to make all consecutive
payments due during a 90-day period. Before declaring the hospital
extended payment plan no longer operative, the hospital, collection
agency, or assignee shall make a reasonable attempt to contact the
patient by telephone and, to give notice in writing, that the
extended payment plan may become inoperative, and of the opportunity
to renegotiate the extended payment plan. Prior to the hospital
extended payment plan being declared inoperative, the hospital,
collection agency, or assignee shall attempt to renegotiate the terms
of the defaulted extended payment plan, if requested by the patient.
The hospital, collection agency, or assignee shall not report
adverse information to a consumer credit reporting agency or commence
a civil action against the patient or responsible party for
nonpayment prior to the time the extended payment plan is declared to
be no longer operative. For purposes of this section, the notice and
telephone call to the patient may be made to the last known
telephone number and address of the patient.
(h) Nothing in this section shall be construed to diminish or
eliminate any protections consumers have under existing federal and
state debt collection laws, or any other consumer protections
available under state or federal law. If the patient fails to make
all consecutive payments for 90 days and fails to renegotiate a
payment plan, this subdivision does not limit or alter the obligation
of the patient to make payments on the obligation owing to the
hospital pursuant to any contract or applicable statute from the date
that the extended payment plan is declared no longer operative, as
set forth in subdivision (g).
SEC. 5. Section 127450 of the Health and Safety Code is amended to
read:
127450. As used in this article, the following terms have the
following meanings:
(a) "Allowance for financially qualified patient" means, with
respect to emergency care rendered to a financially qualified
patient, an allowance that is applied after the emergency physician's
charges are imposed on the patient, due to the patient's determined
financial inability to pay the charges.
(b) "Emergency care" means emergency medical services and care, as
defined in Section 1317.1, that is provided by an emergency
physician in the emergency department of a hospital.
(c) "Emergency physician" means a physician and surgeon licensed
pursuant to Chapter 5 (commencing with Section 2000) of Division 2 of
the Business and Professions Code who is credentialed by a hospital
and either employed or contracted by the hospital to provide
emergency medical services in the emergency department of the
hospital, except that an "emergency physician" shall not include a
physician specialist who is called into the emergency department of a
hospital or who is on staff or has privileges at the hospital
outside of the emergency department.
(d) "Federal poverty level" means the poverty guidelines updated
periodically in the Federal Register by the United States Department
of Health and Human Services under authority of subsection (2) of
Section 9902 of Title 42 of the United States Code.
(e) "Financially qualified patient" means a patient who is both of
the following:
(1) A patient who is a self-pay patient or a patient with high
medical costs.
(2) A patient who has a family income that does not exceed 350
percent of the federal poverty level.
(f) "Hospital" means a facility that is required to be licensed
under subdivision (a) of Section 1250, except a facility operated by
the State Department of State Hospitals or the Department of
Corrections and Rehabilitation.
(g) "Office" means the Office of Statewide Health Planning and
Development.
(h) "Self-pay patient" means a patient who does not have
third-party coverage from a health insurer, health care service plan,
Medicare, or Medicaid, and whose injury is not a compensable injury
for purposes of workers' compensation, automobile insurance, or other
insurance as determined and documented by the emergency physician.
Self-pay patients may include charity care patients.
(i) "A patient with high medical costs" means a person whose
family income does not exceed 350 percent of the federal poverty
level if that individual does not receive a discounted rate from the
emergency physician as a result of his or her third-party coverage.
For these purposes, "high medical costs" means any of the following:
(1) Annual out-of-pocket costs incurred by the individual at the
hospital that provided emergency care that exceed 10 percent of the
patient's family income in the prior 12 months.
(2) Annual out-of-pocket expenses that exceed 10 percent of the
patient's family income, if the patient provides documentation of the
patient's medical expenses paid by the patient or the patient's
family in the prior 12 months. The emergency physician may waive the
request for documentation.
(3) A lower level determined by the emergency physician in
accordance with the emergency physician's discounted payment policy.
(j) "Patient's family" means the following:
(1) For persons 18 years of age and older, spouse, domestic
partner, as defined in Section 297 of the Family Code, and dependent
children under 21 years of age, whether living at home or not.
(2) For persons under 18 years of age, parent, caretaker
relatives, and other children under 21 years of age of the parent or
caretaker relative.
(k) "Reasonable payment formula" means monthly payments that are
not more than 10 percent of a patient's family income for a month,
excluding deductions for essential living expenses. "Essential living
expenses" means, for purposes of this subdivision, expenses for all
of the following: rent or house payment and maintenance, food and
household supplies, utilities and telephone, clothing, medical and
dental payments, insurance, school or child care, child or spousal
support, transportation and auto expenses, including insurance, gas,
and repairs, installment payments, laundry and cleaning, and other
extraordinary expenses.
SEC. 6. Section 127454 of the Health and Safety Code is amended to
read:
127454. (a) Each emergency physician shall make all reasonable
efforts to obtain from the patient, or his or her representative,
information about whether private or public health insurance or
sponsorship may fully or partially cover the charges for emergency
care rendered by the emergency physician to a patient, including, but
not limited to, any of the following:
(1) Private health insurance, including coverage offered through
the California Health Benefit Exchange.
(2) Medicare.
(3) The Medi-Cal program, the Healthy Families Program, the
California Children's Services program, or other state- or
county-funded programs designed to provide comprehensive health
coverage.
(b) If the emergency physician or his or her representative bills
a patient who has not provided proof of coverage by a third party at
the time the care is provided or upon discharge, as a part of that
billing, the emergency physician shall provide the patient with a
clear and conspicuous notice that includes all of the following:
(1) A statement of charges for services rendered by the emergency
physician.
(2) A request that the patient inform the emergency physician if
the patient has health insurance coverage, Medicare, Healthy Families
Program, Medi-Cal, or other coverage.
(3) A statement that if the consumer does not have health
insurance coverage, the consumer may be eligible for Medicare,
Healthy Families Program, Medi-Cal, coverage through the California
Health Benefit Exchange, California Children's Services program,
other state- or county-funded health coverage, or discounted payment
care.
(4) Information regarding the financially qualified patient and
discounted payment application, including the following:
(A) A statement that indicates that if the patient lacks, or has
inadequate, insurance, and meets certain low- and moderate-income
requirements, the patient may qualify for discounted payment. That
statement shall also provide patients with a referral to a local
consumer assistance center housed at legal services offices.
(B) The name and telephone number of the emergency physician's
employee or office from whom or which the patient may obtain
information about the emergency physician's discount payment policy,
and how to apply for that assistance.
(C) If a patient applies, or has a pending application for,
another health coverage program at the same time that he or she
applies for charity care or a discount payment program, neither
application shall preclude eligibility for the other program.
(c) (1) In addition to the statement of the charges, if the
emergency physician uses the following notice in any billing, that
emergency physician shall be deemed to have complied with the notice
requirements of this section: "If you are uninsured or have high
medical costs, please contact ____ (name of person responsible for
discount payment policy) at ____ (area code and phone number) for
information on discounts and programs for which you may be eligible,
including the Medi-Cal program. If you have coverage,
please tell us so that we may bill your
plan."
(2) If the emergency physician or the assignee of the emergency
physician lacks the capacity to provide the notice specified in
paragraph (1), the emergency physician or his or her assignee shall
be deemed to have complied with the notice requirements of this
section if the information required under this section is provided
upon request and if the following is printed on the bill in 14-point
bold type: "If uninsured or high medical bill, call re: discount."
SEC. 7. Section 127455 of the Health and Safety Code is amended to
read:
127455. (a) Each emergency physician shall have a written policy
about when and under whose authority patient debt is advanced for
collection.
(b) Each emergency physician shall establish a written policy
defining standards and practices for the collection of debt, and
shall obtain a written agreement from any agency that collects
emergency physician receivables that it will adhere to the emergency
physician's standards and scope of practice. This agreement shall
require the affiliate, subsidiary, or external collection agency of
the physician that collects the debt to comply with the physician's
definition and application of a reasonable payment formula, as
defined in subdivision (k) of Section 127450. The policy shall not
conflict with other applicable laws and shall not be construed to
create a joint venture between the emergency physician and the
external entity, or otherwise to allow physician and surgeon
governance of an external entity that collects physician and surgeon
receivables. In determining the amount of a debt the emergency
physician may seek to recover from patients who are eligible under
the emergency physician's charity care policy or discount payment
policy, the emergency physician may consider only income and monetary
assets as limited by Section 127452.
(c) For a patient that lacks coverage, or for a patient that
provides information that he or she may be a patient with high
medical costs, the emergency physician, an assignee of the emergency
physician, or other owner of the patient debt, including a collection
agency, shall not report adverse information to a consumer credit
reporting agency or commence civil action against the patient for
nonpayment at any time prior to 150 days after initial billing.
(d) If a patient is attempting to qualify for eligibility under
the emergency physician's discount payment policy and is attempting
in good faith to settle an outstanding bill with the physician and
surgeon by negotiating an extended payment plan, the emergency
physician or his or her assignee, including a collection agency,
shall not report adverse information to a consumer credit agency or
commence a civil action.
(e) (1) The emergency physician or other assignee shall not, in
dealing with patients eligible under the emergency physician's
discount payment policies, use wage garnishments or liens on primary
residences as a means of collecting unpaid emergency physician bills.
(2) A collection agency or other assignee shall not, in dealing
with any patient under the emergency physician's discount payment
policy, use as a means of collecting unpaid emergency physician
bills, any of the following:
(A) A wage garnishment, except by order of the court upon noticed
motion, supported by a declaration filed by the movant identifying
the basis for its belief that the patient has the ability to make
payments on the judgment under the wage garnishment, that the court
shall consider in light of the size of the judgment and additional
information provided by the patient prior to, or at, the hearing
concerning the patient's ability to pay, including information about
probable future medical expenses based on the current condition of
the patient and other obligations of the patient.
(B) Notice or conduct a sale of the patient's primary residence
during the life of the patient or his or her spouse, or during the
period a child of the patient is a minor, or a child of the patient
who has attained the age of majority is unable to take care of
himself or herself and resides in the dwelling as his or her primary
residence. In the event a person protected by this paragraph owns
more than one dwelling, the primary residence shall be the dwelling
that is the patient's current homestead, as defined in Section
704.710 of the Code of Civil Procedure, or was the patient's
homestead at the time of the death of a person other than the patient
who is asserting the protections of this paragraph.
(3) This requirement does not preclude the emergency physician,
collection agency, or other assignee from pursuing reimbursement and
any enforcement remedy or remedies from third-party liability
settlements, tortfeasors, or other legally responsible parties.
(f) Extended payment plans offered by an emergency physician to
assist patients eligible under the emergency physician's discount
payment policy or any other policy adopted by the emergency physician
for assisting low-income patients with no insurance or high medical
costs in settling outstanding past due emergency physician bills,
shall be interest free. The emergency physician's extended payment
plan may be declared no longer operative after the patient's failure
to make all consecutive payments due during a 90-day period. Before
declaring the emergency physician's extended payment plan no longer
operative, the emergency physician, collection agency, or assignee
shall make a reasonable attempt to contact the patient by telephone,
if the telephone number is known, and to give notice in writing that
the extended payment plan may become inoperative, and of the
opportunity to renegotiate the extended payment plan. Prior to the
emergency physician's extended payment plan being declared
inoperative, the emergency physician, collection agency, or assignee
shall attempt to renegotiate the terms of the defaulted extended
payment plan, if requested by the patient. If the patient wishes to
renegotiate the terms of the defaulted extended payment plan but no
agreement can be reached on the amount of the payment, the emergency
physician or his or her assignee shall apply the reasonable payment
formula in subdivision (k) of Section 127450 to determine a monthly
payment amount for a subsequent extended payment plan. If the
reasonable payment formula would result in a payment of less than ten
dollars ($10) a month, the subsequent extended payment plan shall be
ten dollars ($10) per month. The emergency physician, collection
agency, or assignee shall not report adverse information to a
consumer credit reporting agency or commence a civil action against
the patient or responsible party for nonpayment prior to the time the
extended payment plan is declared to be no longer operative. If
after having defaulted on an extended payment plan the patient has
entered into another extended payment plan with payments in the
amount of either the reasonable payment formula or ten dollars ($10)
per month and the patient fails to make all consecutive payments due
during a 90-day period, that extended payment plan is inoperative.
For purposes of this section, the notice and telephone call to the
patient may be made to the last known telephone number and address of
the patient.
(g) For purposes of determining the reasonable payment formula in
subdivision (k) of Section 127450, the emergency physician or his or
her assignee may rely on the determination of family income and
essential living expenses made by the hospital at which emergency
care was provided. The emergency physician or his or her assignee, at
his or her discretion, may accept self-attestation of family income
and essential living expenses by a patient or a patient's legal
representative.
(h) Nothing in this section shall be construed to diminish or
eliminate any protections consumers have under existing federal and
state debt collection laws, or any other consumer protections
available under state or federal law. If the patient fails to make
all consecutive payments for 90 days and fails to renegotiate a
payment plan, this subdivision does not limit or alter the obligation
of the patient to make payments on the obligation owing to the
emergency physician pursuant to any contract or applicable statute
from the date that the extended payment plan is declared no longer
operative, as set forth in subdivision (f).
