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Marty Omoto -  martyomoto@rcip.com   website:   www.cdcan.us

 Report #072-2008  -  April 16, 2008 - Early Wednesday

 

California Legislature

* SB 1136 by Alquist Amended

* Impact On People With Disabilities & Seniors

New Amendment Would Make It Unlawful Under Civil Code To Charge "Unreasonable Fee" For Any Person to Help Another Person Obtain Medi-Cal, IHSS, Regional Center Medicaid Waivered Services and Other Public Social Services or To Aid in Fair Hearings and Other Related Matters

 

SACRAMENTO (CDCAN) -  SB 1136, dealing with public social services by Sen. Elaine Alquist (Democrat - Santa Clara, 13th District) was amended April 14, which would make it unlawful under the State's Civil Code for any person to charge an "unreasonable fee" to help another person obtain various public social services, including Medi-Cal, In-Home Supportive Services, CalWORKS, and Regional Center Medicaid waivered services.  [For a copy of this latest amendment, go to the CDCAN website at www.cdcan.us].  The amendment deletes the parts of the bill that made it a crime that could be prosecuted by county district attorneys. 

 

The scheduled April 15th hearing before the Senate Public Safety Committee was cancelled, and the bill after it was amended, was pulled from that committee and referred to the Senate Judiciary Committee for hearing.  The bill is sponsored by the County of Santa Clara in response to reports of financial abuse of people - especially seniors by persons who claimed could help them qualify for various public social services, for large fees. 

 

Alquist is chair of the Senate Human Services Committee and the Senate Budget Subcommittee #3 on Health, Human Services, Labor and Veteran Affairs and has authored many bills dealing with protection of seniors from financial and physical abuse, and also nursing home and health facility reforms. 

 

Next Steps

No hearing date has been set yet.  Because the bill no longer creates a new crime, the bill no longer is under the jurisdiction of the Senate Public Safety Committee and is no longer - at this point - considered a "fiscal bill" and will not be referred to the Senate Appropriations Committee if it passes out of Senate Judiciary Committee. 

 

Who This Impacts

* The introduced version of the bill originally would have prohibited the charging of any fees by any non-lawyer to help another person obtain public social services (or help them in other ways, including fair hearings, redeterminations).  The original version of the bill exempted lawyers - members of the State Bar. 

* A later version of the bill, prohibited non-lawyers from charging an "unconscionable fee" but still exempted lawyers - an issue that was strongly opposed by some senior and disability advocates.  Others supported it.  In response, Sen. Alquist agreed that the bill should not exempt anyone and promised to amend the bill to reflect that after it passed out of Senate Human Services Committee on April 8. 

* The April 14th version now deletes all references to creating a new crime, and instead makes it unlawful in the civil code for anyone to charge an "unreasonable fee"  as follows:

SECTION 1.    Section 1770 of the   Civil Code   is amended to read:

 1770.  (a) The following unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods or services to any consumer are unlawful: [CDCAN note: existing state law in the civil code has 23 previously enacted unfair methods of competition and unfair or deceptive acts or practices. SB 1136 would add a 24th as follows:]

   (24) (A) Charging or receiving an unreasonable fee to prepare or aid an applicant or recipient in the procurement, maintenance, or securing of public social services. 
   (B) For purposes of this paragraph, the following definitions shall apply: 
   (i) "Public social services" means those activities and functions of state and local government administered or supervised by the State Department of Health Care Services, the State Department of Public Health, or the State Department of Social Services, and involved in providing aid or services, or both, including health care services and medical assistance, to those persons who, because of their economic circumstances or social condition, are in need of that aid or those services and may benefit from them. 
   (ii) "Unreasonable fee" means a fee that is exorbitant and disproportionate to the services performed. Factors to be considered, when appropriate, in determining the reasonableness of a fee, are based on the circumstances existing at the time of the service and shall include, but not be limited to, all of the following: 

(I) The time and effort required.  

(II) The novelty and difficulty of the services.

(III) The skill required to perform the services.  

(IV) The nature and length of the professional relationship. 
(V) The experience, reputation, and ability of the individual providing the services.

 

 SEC. 2.   Section 1780 of the Civil Code   is amended to read:
[CDCAN Note: the following is existing State law - SB 1136 would add a provision to this section - see below (c)(2)]  

1780.  (a) Any consumer who suffers any damage as a result of the use or employment by any person of a method, act, or practice declared to be unlawful by Section 1770 may bring an action against that person to recover or obtain any of the following:

(1) Actual damages, but in no case shall the total award of damages in a class action be less than one thousand dollars ($1,000).

(2) An order enjoining the methods, acts, or practices.

(3) Restitution of property.

(4) Punitive damages.

(5) Any other relief that the court deems proper.

(b) (1) Any consumer who is a senior citizen or a disabled person, as defined in subdivisions (f) and (g) of Section 1761, as part of an action under subdivision (a), may seek and be awarded, in addition to the remedies specified therein, up to five thousand dollars ($5,000) where the trier of fact does all of the following:

(A) Finds that the consumer has suffered substantial physical, emotional, or economic damage resulting from the defendant's conduct.

(B) Makes an affirmative finding in regard to one or more of the factors set forth in subdivision (b) of Section 3345.

(C) Finds that an additional award is appropriate.
(2) Judgment in a class action by senior citizens or disabled persons under Section 1781 may award each class member that additional award if the trier of fact has made the foregoing findings.

[CDCAN note: following is the change to this section (Section 2) of the Civil Code proposed by SB 1136:]

(c) Whenever it is proven by a preponderance of the evidence that a defendant has engaged in conduct in violation of paragraph (24) of subdivision (a) of Section 1770, in addition to all other remedies otherwise provided in this section, the court shall award treble damages to the plaintiff.

 

 

 

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