Article 2.81 - Managed Health Care System for Los Angeles County

California Welfare and Institutions Code — §§ 14087.96-14087.9730

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Sections (30)

Amended by Stats. 2004, Ch. 454, Sec. 1. Effective January 1, 2005.

The following definitions shall apply for purposes of this article:

(a)“County” means the County of Los Angeles.
(b)“Board of supervisors” means the Board of Supervisors of the County of Los Angeles.
(c)“Commission” means the separate public agency established by the board of supervisors to operate a local initiative for health care in the county.
(d)“Local initiative” means the health plan or plans and other health care programs owned or operated by the commission established under this article, and operated pursuant to the strategic plan.
(e)“Medi-Cal managed care programs” means all those components of the Medi-Cal program that involve the restriction of access for Medi-Cal patients to particular providers or health plans and that involve managed care principles, including, but not limited to, programs such as those described in Article 2.7 (commencing with Section 14087.3), Article 2.8 (commencing with Section 14087.5), Chapter 8 (commencing with Section 14200), including pilot programs under Article 7 (commencing with Section 14490) thereof.
(f)“Health care consumer” means a Medi-Cal beneficiary or any other person eligible to receive health care services

under the local initiative, including parents, legal guardians, or conservators of Medi-Cal beneficiaries and people who will receive health care services under the local initiative.

(g)“Health care consumer advocate” means an individual who, whether in a paid or unpaid capacity, represents the interests of Medi-Cal beneficiaries or people who will receive health care under the local initiative.
(h)“Strategic plan” means the report issued on March 31, 1993, by the State Department of Health Services, entitled “The State Department of Health Services’ Plan for Expanding Medi-Cal Managed Care: Protecting Vulnerable Populations” or the report, as subsequently revised or amended.

Amended by Stats. 2004, Ch. 228, Sec. 12.7. Effective August 16, 2004.

(a)The board of supervisors may, by ordinance, resolution, or other action, establish a commission in order to meet the problems of delivery of publicly assisted medical care in the county and demonstrate ways of promoting quality care and cost efficiency. The health care services provided by the commission shall include, but are not limited to, services covered under this chapter provided on a coordinated managed care basis. The commission shall operate the local initiative that provides or arranges for the delivery of health care

services in all or part of the geographic area of the county, in a manner that is consistent with managed care principles, techniques, and practices directed at ensuring cost-effective and adequate access to quality care, without discrimination on the basis of medical condition, diagnosis, or illness, in an amount, duration, and scope that is sufficient to reasonably achieve its purpose for enrollees in the local initiative. If the board of supervisors establishes a commission, all rights, powers, duties, privileges, and immunities vested in the county pursuant to the contract with the department under this article shall be vested in the commission.

(b)(1) The commission shall be considered a public entity that is a local unit of government and that is separate from the county, shall file the statement required by Section 53051 of the Government Code, and shall be considered a public entity for purposes of Division 3.6

(commencing with Section 810) of Title 1 of the Government Code. The commission, members of the commission, and employees of the commission shall be protected by the immunities applicable to public entities and public employees governed by Part 2 (commencing with Section 814) of Division 3.6 of Title 1 of the Government Code, except as provided by other statutes or regulations that apply expressly to the commission.

(2)The commission shall have all power necessary and appropriate to do all of the following:
(A)Operate programs involving health care services, including, but not limited to, the power to own and operate one or more health plans.
(B)To enter into agreements with any public or private entity or entities to provide or arrange for health care services on a capitated or noncapitated basis.
(C)To acquire, possess, and dispose of real or personal property.
(D)To employ personnel and contract for services required to meet its obligations.
(E)To sue or be sued.
(F)To enter into agreements under Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code.
(3)The commission may enter into contracts with public and private health care providers to provide health care and related services to individuals enrolled in any health plan or health program operated as part of the local initiative.
(c)Nothing in this section shall be construed to authorize the commission to operate any health

care program other than the local initiative described in the strategic plan as it currently exists or as it may be amended by the department.

Amended by Stats. 2004, Ch. 454, Sec. 2. Effective January 1, 2005.

Governance of the commission shall be vested in a governing body consisting of 13 members, each of whom shall have a fiduciary duty to act in the best interest of the commission and the local initiative, nominated by the following entities, and appointed by the board of supervisors:

(a)Four members shall be nominated by the board of supervisors to represent the County of Los Angeles. No more than one member nominated by the board of supervisors shall be a member of the board of supervisors and

each remaining member nominated by the board of supervisors shall possess experience as a health care administrator or as a health care provider.

(b)One member shall be a representative of private hospitals that have Medi-Cal disproportionate share status, or if that status no longer exists, that serve an equivalent patient population, who shall be nominated by the Hospital Association of Southern California.
(c)One member shall be a representative of private hospitals that do not have Medi-Cal disproportionate share status, who shall be nominated by the Hospital Association of Southern California.
(d)One member shall be a representative of free and community clinics, who shall be nominated by the Community Clinics Association of Los Angeles County.
(e)One member shall be a representative of federally qualified health centers, who shall be nominated by the Community Clinics Association of Los Angeles County, or if that status no longer exists, an equivalent group of health centers.
(f)One member shall be a physician representative, who shall be nominated by the Los Angeles County Medical Association, in consultation with other physician associations within the county.
(g)One member shall be a representative of Knox–Keene licensed prepaid health plans, who shall be nominated by the California Association of Health Plans.
(h)One member shall represent health care consumers, and at the time of being nominated, shall be a health care consumer. The initial nominee shall be nominated by the working group on the role of the consumer for the first

nominee, and thereafter, by a process determined by the community advisory committee under which only health care consumers may nominate and vote for appointees.

(i)One member shall be a health care consumer advocate, who shall represent health care consumers. The initial nominee shall be nominated by the working group on the role of the consumer for the first nominee, and thereafter, by a process determined by the community advisory committee under which only health care consumers may nominate and vote for appointees.
(j)One member shall be a children’s health care provider representative, who shall be nominated by the Children’s Planning Council as the coordinating entity for organizations and agencies providing direct services to, or advocacy for, children and families within the county.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)The composition of the 13-member governing body of the commission, as prescribed in Section 14087.961, shall be subject to alteration upon a two-thirds vote of the full membership of the governing body, if the action is also concurred in by an affirmative vote of at least four members of the board of supervisors; provided, however, no change in the composition of the governing board shall result in the elimination of representation by the county, private physicians, hospitals, and other providers, clinics, or consumers and consumer

advocates.

(b)Notwithstanding subdivision (a), no governing body member shall be removed except as provided in Section 14087.964.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

Members of the governing body shall either reside, be employed, or provide services in the geographic area served by the local initiative. Nominees shall be appointed to the governing body by the board of supervisors. The board of supervisors shall not deny appointment to a nominee described in subdivisions (b) to (j), inclusive, of Section 14087.961 without specific cause as set forth in Section 14087.964.

Amended by Stats. 2004, Ch. 454, Sec. 3. Effective January 1, 2005.

(a)Members of the governing body of the commission shall serve four-year terms.
(b)Individuals shall be limited to serving on the governing body for two consecutive four-year terms or a maximum of 10 years.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)The governing body of the commission shall establish rules for its proceedings. There shall be at least six meetings per year.
(b)(1) Each governing body member shall be entitled to one hundred dollars ($100) remuneration from commission funds for each governing body meeting attended, and may receive similar remuneration for attending meetings of committees of the governing body, except that the total remuneration for each governing body member

for all meetings shall not exceed the sum of four hundred dollars ($400) per month, plus actual expenses incurred in attending these meetings at rates payable to county officers and employees.

(2)The per meeting rate and monthly limit of one hundred dollars ($100) and four hundred dollars ($400), respectively, may be increased by the governing body, subject to approval by the board of supervisors.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)A majority of the members of the governing body shall constitute a quorum for the transaction of business, and all official acts of the governing body shall require the affirmative vote of a majority of the members present and voting.
(b)No official act shall be approved with less than the affirmative vote of four members of the governing body, unless the number of members prohibited from voting because of conflicts of interest precludes adequate participation in the

vote.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

A member of the governing body shall be removed from office if a majority of the members present and voting find that one or more of the following causes for removal exists:

(a)The member neither lives in, nor is employed in, the geographic area served by the local initiative.
(b)The member has been convicted of a crime involving corruption or any felony.
(c)The

member has failed to attend three consecutive governing body meetings or a majority of the meetings in the most recent calendar year.

(d)The member has failed to discharge legal obligations as a member of a public agency.
(e)A request for removal has been submitted by the appropriate nominating entity in accordance with Section 14087.9645.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

A member of the governing body may be removed at the request of the entity that nominated the member. The entity that nominated a member may request removal of that member for any of the following reasons:

(a)Any of the causes listed in Section 14087.964.
(b)The member no longer meets the qualifications for office or the criteria applied by the nominating entity in selecting the member as its nominee.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)A request for removal under Section 14087.9645 shall be adopted by the nominating entity in the same manner as the nomination was adopted and shall be confirmed by a written request for removal delivered to the governing body, setting forth the grounds for removal.
(b)A removal under subdivision (a) shall be effective upon action by the governing body, that shall be taken at the first meeting following receipt of the written request.
(c)The nominating entity shall be legally responsible for improper removals.
(d)A nominating entity that requests removal of a governing body member shall nominate a successor within 60 days after the effective date of the removal.

Amended by Stats. 2001, Ch. 528, Sec. 1. Effective January 1, 2002.

(a)The governing body shall establish a technical advisory committee to provide technical expertise to the governing body.
(b)Members of the committee shall include a medical school representative, an epidemiologist, a pharmacist, a representative of a nursing association, a home health care representative, a long-term care provider, a mental health care provider, a medical rehabilitation provider, and an expert on health care quality, or, in the alternative, other

persons with health care expertise.

(c)The technical advisory committee shall meet on a regular basis, and shall make recommendations and reports to the governing body.

Added by Stats. 2001, Ch. 528, Sec. 2. Effective January 1, 2002.

(a)The governing body shall establish a children’s health consultant advisory committee to provide to the governing body expertise on child, adolescent, and maternal health issues.
(b)Members of the committee shall include representatives of government health departments and school districts in the geographic area served by the local initiative, as well as medical professionals with background in pediatrics and obstetric care, or, in the alternative, other persons with

health care expertise.

(c)The children’s health consultant advisory committee shall meet on a regular basis, and shall make recommendations and reports to the governing body.

Amended by Stats. 2004, Ch. 454, Sec. 4. Effective January 1, 2005.

(a)The governing body for each geographic region served by the local initiative shall establish a regional community advisory committee to ensure community involvement.
(b)Each regional community advisory committee shall have no more than 35 members, a majority of whom shall be consumers and consumer advocates, but may also include providers.
(c)(1) The chairpersons of the regional

community advisory committees shall comprise an executive community advisory committee.

(2)It is the intent of the Legislature that a majority of the executive community advisory committee shall be consumers and consumer advocates, plus two at-large members.
(d)The executive community advisory committee shall make recommendations, and shall report on its activities, to the governing body and shall be able to place matters of the governing body’s agenda for consideration.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)The commission may borrow or receive funds from any person or entity as necessary to cover development costs and other actual or projected obligations of the local initiative.
(b)The county may lend funds to the commission upon such terms as the board of supervisors may establish.
(c)Notwithstanding any other provision of law, both the county and the commission shall be eligible to receive funding under

subdivision (p) of Section 14163, and the local initiative shall be considered for all purposes to satisfy the requirements of subdivision (p) of Section 14163.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

To the full extent permitted by federal law, the department and the commission may enter into contracts to provide or arrange for health care services for any or all persons who are eligible to receive benefits under the Medi-Cal program. The contracts may be on an exclusive or nonexclusive basis, and shall include payment provisions on any basis negotiated between the department and the commission. In addition, health plans or programs operated by the commission as part of the local initiative may also include, but are not limited to, individuals covered

under Title 18 of the Social Security Act (Subchapter 18 (commencing with Section 1395) of Chapter 7 of Title 42 of the United States Code), individuals employed by public agencies and private businesses, and uninsured or indigent patients.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)The auditor-controller of the county, at those intervals the auditor-controller deems appropriate, but no less frequently than annually, shall conduct a review of the fiscal condition of the commission, report the findings to the commission and the board of supervisors, and provide a copy of the findings to any public agency upon request.
(b)At the county auditor-controller’s discretion, other operational or financial audits of the commission may be conducted.
(c)Upon the written request of the county auditor-controller, the commission shall provide full access to all commission records and documents as necessary to allow the county auditor-controller to perform the activities authorized by this section.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

Notwithstanding any other provision of law, the county shall not be liable for any damages or losses, whether financial or in any other form, that may result from the reliance of any person, entity, or agency on the actions or omissions of, or the findings made by, the auditor-controller under this section.

Added by Stats. 1994, Ch. 632, Sec. 2.5. Effective September 20, 1994.

(a)Notwithstanding any other provision of law, any obligation of the commission and its local initiative, statutory, contractual, or otherwise, shall be an obligation solely of the commission and shall not be an obligation of the county or of the state. Except as otherwise provided in this article, neither the county nor the state shall be liable for any act or omission of the commission.
(b)Except as agreed to by contract with the county, no liability of the commission

shall become an obligation of the county upon either termination of the commission and its local initiative or the liquidation or disposition of the commission’s remaining assets.

(c)All claims for money damages against the commission shall be governed by Part 3 (commencing with Section 900) and Part 4 (commencing with Section 940) of Division 3.6 of Title 1 of the Government Code, except as otherwise provided by other statutes or regulations that expressly apply to the commission.

Amended by Stats. 2004, Ch. 454, Sec. 5. Effective January 1, 2005.

(a)Notwithstanding any other provision of law, neither a member of the governing body of the commission nor a member of any advisory panel to the governing body shall be deemed to be interested in a contract or amendment to a contract entered into by the commission within the meaning of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code if all of the following conditions are satisfied:
(1)The board of supervisors or the

governing body appointed the member to represent the interests of the county, physicians, health care practitioners, hospitals, pharmacies, other health care organizations, consumers, or consumer advocates. For purposes of this section, each group whose interests are described in this paragraph shall be referred to as a stakeholder.

(2)The contract or the contract as amended authorizes individuals or organizations in the same stakeholder group that the member was appointed to represent to provide services under the local initiative.
(3)The contract or the contract as amended contains substantially the same terms and conditions as contracts entered into with other individuals or organizations in the same stakeholder group that the member was appointed to represent.
(4)The contract or the contract as amended does

not specifically authorize the member or the member’s organization, as defined in paragraph (1) of subdivision (e), to provide services under the local initiative.

(b)If paragraphs (1) to (3), inclusive, of subdivision (a) are satisfied but the contract or the contract as amended would specifically authorize the member or the member’s organization to provide services under the local initiative, the contract approved by the governing body of the commission shall be deemed to comply with Section 1090 of the Government Code if the member abstains from voting on the contract or amendment to the contract, the member discloses the interest to the governing body or the advisory panel, whichever is applicable, the governing body or advisory panel notes the disclosure and the abstention in its official records, the member does not influence or attempt to influence the governing body, the advisory panel, or any member of the governing body or advisory

panel to enter into the particular contract or the contract as amended, and the governing body or advisory panel authorizes the contract or amendment to the contract in good faith only by a vote of its membership sufficient for the purpose without counting the vote of the member.

(c)Notwithstanding any other provision of law, income from a contractor under the local initiative to a member or to a member’s organization, as defined in paragraph (1) of subdivision (e), which is unrelated income, as defined in paragraph (2) of subdivision (e), shall not cause the member of the governing body of the commission or the member of the advisory panel to the governing body to be deemed to be interested in the contract or amendment to the contract for purposes of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code, if the contract or the contract as amended contains substantially the same terms and

conditions as contracts entered into with other contractors in the same stakeholder group that is the source of the unrelated income.

(d)If the particular contract or the contract as amended does not contain substantially the same terms and conditions as contracts entered into with other contractors in the same stakeholder group that is the source of the unrelated income, the contract approved by the governing body of the commission shall be deemed to comply with Section 1090 of the Government Code if the member abstains from voting on the contract or amendment to the contract, the member discloses the interest to the governing body or the advisory panel, whichever is applicable, the governing body or advisory panel notes the disclosure and abstention in its official records, the member does not influence or attempt to influence the governing body to enter into the particular contract or the contract as amended, and the governing body or

advisory panel authorizes the contract or amendment to the contract in good faith only by a vote of its membership sufficient for that purpose without counting the vote of the member.

(e)For purposes of this section, the following definitions shall apply:
(1)“Member’s organization” means an entity for which the member serves as an employee, officer, board member, or consultant, or in which the member has any other financial interest for purposes of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code.
(2)“Unrelated income” means income that is not related to, or is not for providing services under, the local initiative.

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