Chapter 8Nonprovider Health Care Districts

Section § 32495

Explanation

This section defines key terms used in the law about health care districts. "Administrative expenses" are costs associated with running the district, like salaries and office supplies. "Direct health service" involves owning or directly operating health facilities like hospitals and clinics. A "Nonprovider health care district" is a district without direct health services, hasn't received property tax funds for three years, has assets of $20 million or more, isn't in a rural underserved area, and spends less on community grants than twice its administrative costs for two consecutive years.

For the purposes of this chapter, the following definitions shall apply:
(a)CA Health and Safety Code § 32495(a) “Administrative expenses” means expenses relating to the general management of a health care district, such as accounting, budgeting, personnel, procurement, legal fees, legislative advocacy services, public relations, salaries, benefits, rent, office supplies, or other miscellaneous overhead costs.
(b)CA Health and Safety Code § 32495(b) “Direct health service” means ownership or direct operation of a hospital, medical clinic, ambulance service, transportation program for seniors or persons with disabilities, a wellness center, health education, or other similar service.
(c)CA Health and Safety Code § 32495(c) “Nonprovider health care district” means a health care district that meets all of the following criteria:
(1)CA Health and Safety Code § 32495(c)(1) The district does not provide direct health care services to consumers.
(2)CA Health and Safety Code § 32495(c)(2) The district has not received an allocation of real property taxes in the past three years.
(3)CA Health and Safety Code § 32495(c)(3) The district has assets of twenty million dollars ($20,000,000) or more.
(4)CA Health and Safety Code § 32495(c)(4) The district is not located in a rural area that is typically underserved for health care services.
(5)CA Health and Safety Code § 32495(c)(5) In two or more consecutive years, the amount the district has dedicated to community grants has amounted to less than twice the total administrative costs and overhead not directly associated with revenue-generating enterprises.
administrative expenses general management health care district direct health service hospital operations medical clinic ambulance service wellness center health education nonprovider health care district real property taxes district assets community grants overhead costs rural underserved area
(Added by Stats. 2016, Ch. 421, Sec. 1. (AB 2737) Effective January 1, 2017.)

Section § 32496

Explanation

This law sets rules for how nonprovider health care districts must allocate their budgets. They cannot use more than 20% of their budget on administrative costs, and they are required to use at least 80% of their budget on community grants to organizations that directly provide health services.

(a)CA Health and Safety Code § 32496(a) A nonprovider health care district shall not spend more than 20 percent of its annual budget on administrative expenses.
(b)CA Health and Safety Code § 32496(b) A nonprovider health care district shall spend at least 80 percent of its annual budget on community grants awarded to organizations that provide direct health services.
nonprovider health care district administrative expenses annual budget cap community grants direct health services budget allocation health care funding spending limits fiscal management health care support organizations grant requirements budgetary restrictions public health funding financial oversight health service provision
(Added by Stats. 2016, Ch. 421, Sec. 1. (AB 2737) Effective January 1, 2017.)

Section § 32498

Explanation

This law says that, before spending any money from its annual budget on planned items, a nonprovider health care district must first pay off any debts from court decisions or arbitration awards that are final and can't be appealed, as long as those debts haven't been canceled or stopped by the courts or laws.

Notwithstanding Section 32496, and prior to payment of any annual budget item described in Section 32496, a nonprovider health care district shall pay any amount required to be paid in the district’s annual budget year by a final judgment, court order, or arbitration award for which appeals have been exhausted or for which the period for appeal has expired, enforcement of which is not barred by the order of any court or by any statutory provision, and which has not been nullified or rendered void by any court order or statutory provision.
nonprovider health care district annual budget final judgment court order arbitration award exhausted appeals payment requirements enforcement debts legal obligations financial priority court decisions
(Added by Stats. 2016, Ch. 421, Sec. 1. (AB 2737) Effective January 1, 2017.)