At the beginning of this year, California passed several new laws affecting health care providers. Largely aimed at improving patient care and patients’ rights, the new laws directly affect hospital operations ranging from patient confidentiality to infection-control hygiene programs. While from the California Legislature’s perspective the laws are aimed at improving patient welfare, the new protections inevitably create additional expenses for health care providers. Hospitals and other health care facilities in California will need to be aware of the new laws and the increased compliance requirements they carry. Some of the more significant developments are summarized below. 

Patient Privacy

On January 1, 2009, two bills became effective which provide increased penalties for breaches of medical data confidentiality, along with new oversight requirements to protect patient confidentiality. These bills were prompted in large part by revelations concerning employees at a prominent Los Angeles medical center who had been caught improperly accessing celebrity medical data. The bills also sought to address concerns about the unauthorized use of patient data for fundraising and marketing. These new laws hold providers, health plans and individuals accountable for unauthorized access to, or disclosure of, patient information — even in many cases where the use or disclosure is not otherwise unlawful. 

Under both AB 211 and SB 541, “unauthorized access” is defined as “the inappropriate review or viewing of patient medical information without a direct need for diagnosis, treatment, or other lawful use as permitted by the Confidentiality of Medical Information Act (CMIA)(Part 2.6 (commencing with Section 56) of Division 1 of the Civil Code) or by other statutes or regulations governing the lawful access, use, or disclosure of medical information.” The purposes of these two laws intersect in the area of patient privacy, and there may prove to be some conflict in adhering to the demands of both. 

Under AB 211, providers, health care service plans and contractors must reasonably safeguard confidential medical information, and prevent unauthorized access. AB 211 amends the California Health and Safety Code, adding Sections 130200- 130205. These sections require every provider of health care to implement appropriate administrative, technical and physical safeguards to protect the privacy of a patient’s medical information and safeguard it from unauthorized or unlawful access, use or disclosure. The new law creates the California Office of Health Information Integrity (CalOHII) within the California Health & Human Services Agency to enforce these requirements and impose administrative fines for unauthorized access, disclosure, or use of medical information. CalOHII is authorized to levy fines against persons and many licensed and unlicensed health care providers, and may also refer violators to the appropriate licensing board for oversight.  Penalties range from $25,000 to $250,000 for violations. The amount of the fine is governed by the application of factors listed in the statute.

SB 541 amends Health & Safety Code Sections 1280.1 and 1280.3 and adds Section 1280.15. Like AB211, SB 541 authorizes the Department of Public Health to impose administrative penalties for unauthorized access, use, or disclosure of patient information.  These penalties may be as large as $25,000 for a first violation, and up to $17,500 for subsequent occurrences. Additionally, providers must report all incidents of unlawful or unauthorized access, use, or disclosure to the Department of Public Health and to the affected patient. Failure to report carries a fine of up to $100 per day. 

Hospital Infection Control

On January 1, 2009, SB 1058 and SB 158 became effective. These bills aimed at stemming hospital infection rates and making information on hospital-borne infections more available to the public. The Department of Health Services estimates that as many as 9,600 Californians die annually from hospital-borne infections.  SB 1058 adds Sections 1255.8 and 1569.39 to the Health & Safety Code.  The new sections require hospitals to screen certain patients for Methicillin Resistant Staph Aureus (MRSA) bacteria.  The targeted patient groups are: (i) patients scheduled for in-patient surgery and who are considered susceptible to infection; (ii) have been admitted to a hospital within the last 30 days; (iii) are receiving dialysis; (iv) are being admitted to an intensive care or burn unit; or (v) have been transferred from a nursing home. If a patient tests positive for MRSA bacteria, SB 1058 requires the hospital to inform the patient and to provide the patient with instructions on how the patient may prevent the infection from spreading to others. SB 1058 also requires the Department of Health to establish a program for collecting infection rate data from hospitals. The aim is to make this information available to the public by 2011.  This law makes California the 25th state to implement such a program. 

The overall goal of SB 1058 is the prevention of new MRSA infections through testing, disclosure and follow-up education when the patient is discharged. It does not instruct hospitals in the treatment of MRSA infections, nor does it provide mandates for medical and nursing staff education about the effects of MRSA. The difficulty in preventing MRSA transmissions has led many health care facilities to implement more stringent hygiene protocols. SB 1058, however, focuses largely on the consumer-interest side, mandating patient education and public disclosure of infection rates. 

SB 158 is similarly designed to lower infection rates, but approaches the problem from the facility staff side of the equation. To that end, SB 158 requires hospitals to create detailed infection control training for staff. It also requires facilities to develop patient-safety plans and facility-wide hand hygiene protocols. To strengthen the impetus to create effective programs, SB 158 also increases the Department of Health’s power to investigate infection outbreaks and complaints about inadequate infection control practices. SB 158 amends Health & Safety Code Sections 1288.5 and 1288.8 and adds Sections 1279.6, 1279.9, 1288.45 and 1288.95. 

The sum total of these bills for health care facilities means an increased outlay of resources to create and strengthen infection control programs. In addition to staff protocol, health care facilities will have the added expenses of patient education and statistical reporting. These bills contain no provision to defray the heath care facilities’ costs of gathering and keeping these statistics. However, the state will defray the expense of the local government health agencies which will carry out the surveys. 

End-of-Life Care

California Assembly Bill 2747 requires physicians and health care organizations to provide terminally ill patients – upon that patient’s request – with “comprehensive information and counseling” about their legal rights and options during their end-of-life care. AB 2747 adds Part 1.8 (commencing with Section 442) to Division 1 of the Health & Safety Code. The bill – known as the “Terminal Patients’ Right To Know End-Of-Life Options Act” – states that patients with terminal diagnoses have the right to know about their options for hospice care, creating advance directives and refusing life-sustaining treatment. The bill also requires physicians to inform patients of the right to comprehensive pain and symptom management, including treatments designed for patients whose condition is irretrievable. 

Specifically, AB 2747 requires that when a physician makes a diagnosis that a patient’s condition is terminal, the physician must provide the patient with an opportunity to receive information and counseling regarding end-of-life-legal options. If the physician will not comply – or if the physician cannot comply for religious or philosophical reasons of his own – then the physician must provide information on transfer procedures to a provider who will provide such information. 

Unless and until the patient requests end-of-life option information, the physician is under no obligation to provide such information, or to refer the patient to a provider who will. By making the bill’s requirements patient-dependent, the bill takes the onus off the physicians who are unable or unwilling to initiate conversation on end-of-life matters. 

At present, the vast majority of terminally ill patients who seek hospice care do so only in the last month of their life. Many proponents of AB 2747 believe this is due to a lack of patient awareness concerning hospice care options. It is believed that this bill will help increase the number of patients in California who seek hospice care earlier. In addition, many patients are currently unaware that end-of-life counseling is a covered benefit under Medicare, and it is hoped that AB 2747 will rectify this situation. 

If you have any questions or would like additional information, please feel free to contact any of the Arent Fox health care law attorneys listed below, or the Arent Fox attorney who regularly handles your legal needs. 

Lowell C. Brown
brown.lowell@arentfox.com
213.443.7516

Jonathon E. Cohn
cohn.jon@arentfox.com
213.443.7515

Sarah G. Benator
benator.sarah@arentfox.com
213.443.7518