CHA News Article

Governor Vetoes CHA’s Top Three Bills to Oppose

In a major legislative victory for California hospitals, Gov. Brown vetoed SB 1094 (Lara, D-Bell Gardens), AB 2616 (Skinner, D-Berkeley) and SB 455 (Hernandez, D-West Covina) Sept. 29 — one day prior to the Sept. 30 deadline for final action on state legislation.

CHA’s highest priority to defeat, SB 1094, would have expanded the state attorney general’s (AG) authority to review and impose conditions on the sale or transfer of nonprofit hospitals and their assets. Specifically, the bill would have allowed the AG to amend a condition — after a transaction has been completed — if the hospital is alleged to have made a material misrepresentation or violated a condition of consent. By allowing the AG to unilaterally change the terms of the sale or transfer after those transactions closed and consent was provided, SB 1094 would have eliminated any certainty in the transactions. The AG currently has the authority and discretion to approve, deny or place conditions on nonprofit hospital transactions. SB 1094 would have circumvented due process by allowing the AG to change the condition, allowing only a written response from the hospital. The bill also would have jeopardized financing for hospitals by placing increased risk on the transactions.

“For nearly two decades, the Attorney General has had the authority to approve, deny or place conditions on these transactions in order to evaluate impacts on the community’s access to health care services, and safeguard — as much as possible — those assets that have been held in the public trust,” the Governor’s veto message states.

AB 2616 would have established a presumption in the workers’ compensation system for public and private hospital employees who direct patient care. The presumption would have relieved the majority of hospital employees from needing to demonstrate that a methicillin-resistant Staphylococcus aureus (MRSA) infection was caused by their employment, when any part of the condition develops while they are employed by a hospital or for 60 days after employment ends. Although the potential costs of the bill are hard to quantify, the amount would have been substantial. Workers’ compensation costs for an MRSA skin infection can range from $4,500 to $300,000 per incident.

SB 455 would have required the California Department of Public Health (CDPH) to inspect hospital compliance with nurse-to-patient ratios and require every general acute care hospital to establish and maintain a patient classification system. In addition, the bill would have required the direct patient care members of that system to be appointed by the collective bargaining agent if the hospital’s employees are represented by one. In his veto message, the Governor states that the bill “restates current law” and “directs decisions that are best left at the local level.”

CHA thanks members for their support and assistance in requesting a veto on these bills. CHA will issue a wrap-up of all final legislative action on its highest-priority bills this Friday, Oct. 3.