SB 1076 - GACH: Observation Services, effective January 1, 2017, permits hospitals to establish one or more outpatient observation units to provide outpatient observation services to patients. An observation unit must comply with the same licensed nurse-to-patient ratios as emergency services.

Definitions

SB 1076 defines "observation services" as outpatient services provided by a GACH to patients who have unstable or uncertain conditions potentially serious enough to warrant close observation, but not so serious as to warrant inpatient admission to the hospital.

Observation services may include:

• the use of a bed
• monitoring by nursing and other staff; and
• any other services that are reasonable and necessary to safely evaluate a patient’s condition or determine the need for a possible inpatient admission to the hospital

An "observation unit" is an area in which the facility provides observation services in a setting outside of any inpatient unit and that is not part of an emergency department.

Signage Requirement

Observation units must be marked with signage identifying the observation unit area as an outpatient area. The signage must use the term "outpatient" in the title of the designated area to indicate clearly to all patients and family members that the observation services provided in the unit are not inpatient services.

Written Notice Requirement

The facility is responsible for providing written notice to a patient as soon as practicable that he or she is on observation status whenever a patient:

• is receiving observation services in an inpatient unit of a hospital
• is receiving observation services in an observation unit
• has a change in status from inpatient to observation

The notice must state that observation care is provided on an outpatient basis, which may affect his or her health care coverage reimbursement.

Licensed Nurse to Patient Ratio Requirement

An outpatient observation unit must comply with the same licensed nurse-to-patient ratios as emergency services.

The licensed nurse-to-patient ratio in an observation unit must be 1:4 or fewer at all times when patients are receiving treatment. There may be no fewer than two licensed nurses physically present in the observation unit when a patient is present.

Applying to Operate an Observation Services Unit

Facilities choosing to operate an observation services unit must obtain L&C approval prior to operation. Hospitals must submit the following documents to the department:

• HS 200 – Licensure and Certification Application
• CDPH 246 – Application for Outpatient Service
• CDPH 268 – Application for Supplemental Service Approval
• CDPH 609 – Bed or Service Request (Select "Outpatient Service" under the Requested Services section and indicate "Observation Services Unit")
• Floor Plan
• STD 850 – Fire Safety Inspection Request
• OSHPD Approval

NOTE: L&C will promulgate supplemental service regulations for the operation of an observation unit.

OSHPD Data Requirements

The Health Data and Advisory Council Consolidation Act (Act) requires OSHPD to compile and publish summaries of financial and patient data. SB 1076 revises the Act to require OSHPD to include summaries of observation services data upon request. The summaries must be posted on OSHPD’s internet website.

Facilities are responsible for following all applicable laws. The CDPH’s failure to expressly notify facilities of statutory or regulatory requirements does not relieve facilities of their responsibility for following all California and federal laws and regulations.
If you have any questions, please contact the CAU at (916) 552-8632.

Sincerely,

Original signed by Scott Vivona for

Jean Iacino
Deputy Director