AB 1607 adds Section 1797.98a to the Health and Safety Code and establishes the Maddy Emergency Medical Services (EMS) Fund as a county-level mechanism to reimburse emergency providers for uncompensated care. Counties create the fund by board resolution, may administer it themselves (or let the state administer if the county’s medically indigent services program is state-run), and must use revenue from specified penalty assessments as the funding source.
The bill prescribes how funds are allocated among physicians, hospitals providing disproportionate trauma and emergency care, and other local EMS purposes; limits administrative reimbursements; authorizes reserves; and creates a time-limited pediatric trauma allocation called Richie’s Fund. For local EMS agencies, hospitals, and emergency physicians, the bill changes who gets paid, how much they might receive up front, and the reporting and administrative work required to collect and distribute these penalty-assessment dollars.
At a Glance
What It Does
Creates a county-level Maddy EMS Fund funded by specified penalty assessments, requires counties to adopt a resolution to establish and administer it (or opt into state administration), and directs a fixed allocation of the fund to physician reimbursements, hospitals with disproportionate trauma/emergency workloads, and other EMS uses. It also carves out a pediatric trauma pool (Richie’s Fund) for a limited period.
Who It Affects
County boards of supervisors and local EMS agencies (administration and allocation decisions), emergency physicians in general acute care hospitals, hospitals that provide disproportionate trauma and emergency services, and pediatric trauma centers and children's hospitals that can receive targeted funds.
Why It Matters
This bill converts penalty-assessment revenue into a structured, county-controlled reimbursement program that alters uncompensated-care flows and creates a predictable (but locally controlled) funding stream for pediatric trauma, while imposing new administrative and reporting responsibilities on counties and providers.
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What This Bill Actually Does
AB 1607 establishes the Maddy EMS Fund as the repository for certain penalty-assessment revenues and authorizes each county to set up and run its own fund by a resolution of the board of supervisors. A county that already elects state administration for its medically indigent services may similarly elect state administration for its EMS fund, preserving an option for centralized handling.
The statute requires that interest on fund balances remain in the fund and allows each administering entity to hold limited reserves, but otherwise directs distributions according to a statutory allocation schedule.
The bill separates administrative costs from program dollars and limits reimbursement for administration to either the administering agency’s actual costs or 10 percent of the fund, whichever is lower. It also allows separate administrative reimbursement limits for monies collected under the related Government Code provision used to finance pediatric trauma services.
Counties may use a portion of the fund for capital purchases and capital projects only when those expenditures directly support emergency services and align with the chapter’s intent.On provider payments, AB 1607 creates a two-step flow for physician reimbursements: an initial cycle payment (physicians may receive up to half of the claimed amount in that first payment cycle) followed by a year-end reconciliation in which remaining funds above any permitted reserve are distributed proportionally to all qualifying claimants based on claims paid during the year. The statute explicitly excludes physicians employed by county hospitals from the physician-directed portion and limits physician and hospital reimbursements to care provided up to the point when the patient is stabilized.Finally, the bill sets aside a separate, time-limited allocation known as Richie’s Fund drawn from funds deposited under Government Code Section 76000.5.
That pool is dedicated to pediatric trauma centers and related pediatric emergency services, with the statute allowing local EMS agencies to perform needs assessments to target spending and directing counties without pediatric trauma centers to prioritize improving access and coordination of pediatric trauma care. The Richie’s Fund provisions and their administrative-cost cap are expressly operative only through January 1, 2037.
The Five Things You Need to Know
The statute names the pool the "Maddy EMS Fund" and requires a county board resolution to establish a county fund (or an affirmative election to have the state administer it).
Physician reimbursements (excluding physicians employed by county hospitals) receive the largest share of the fund; the statute requires payments only for emergency services provided up to the point the patient is stabilized.
A specified portion of the fund is reserved exclusively for hospitals that provide disproportionate trauma and emergency medical care, creating a targeted hospital pool.
The bill permits an administering agency to make an initial physician payment equal to up to 50 percent of the claimed amount in the first reimbursement cycle, with any remaining discretionary funds distributed proportionally at fiscal-year end after reserves.
Fifteen percent of the money deposited under Government Code Section 76000.5 is set aside as Richie’s Fund for pediatric trauma centers and related pediatric emergency services; these Richie’s Fund rules (including an administrative-cost cap) expire on January 1, 2037.
Section-by-Section Breakdown
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Official name — Maddy Emergency Medical Services (EMS) Fund
This short provision gives the fund an official name. Naming statutes matters for references in later regulations, county resolutions, grant applications, and accounting systems—counties and state administrators will use this exact name in budgets, audits, and claims forms.
County establishment, administration options, reserves, and allocation framework
Subdivision (b) is the operational core: it authorizes counties to create the fund by board resolution and to run it themselves, but preserves an option to delegate administration to the state if the county already has state-administered medically indigent services. The provision caps reimbursements for fund administration at the administering agency’s actual costs or 10 percent of the fund, whichever is lower, requires interest to remain in the fund, and permits limited reserves (including a specific reserve allowance for the physician and hospital portions). Paragraph (5) sets out the broad allocation framework among physicians, hospitals providing disproportionate trauma/emergency care, and other EMS purposes—this is the statutory prioritization that will drive local budgeting and provider expectations.
Funding source: penalty assessments
This subsection ties the Maddy EMS Fund to penalty-assessment revenue collected under Government Code Section 76000. That linkage creates a dedicated revenue stream but also exposes the fund to variability in court collections and shifts the fiscal logic away from general-purpose county revenue. Counties will need to track these designated receipts separately and may face timing mismatches between when assessments are collected and when claims are payable.
Payment timing: initial 50% cycle and year‑end proportional distribution
Subdivision (d) creates a two-step payment process for physician claims: an administering agency may pay up to half of an eligible physician’s claimed amount in the first payment cycle, then reconcile and distribute any remaining funds at year-end proportionally among qualifying claimants after rolling over reserves. Practically, this requires claim intake and tracking systems capable of recording initial cycle payments, holding balances for reconciliation, and calculating pro rata shares—operations that can strain smaller county offices unless they invest in upgraded claims infrastructure.
Richie’s Fund: pediatric trauma allocation and targeting rules (temporary)
Subdivision (e) directs that a defined portion of money deposited under Government Code Section 76000.5 be used for pediatric trauma centers and related pediatric emergency services, permitting reimbursement to physicians and hospitals for uncompensated pediatric emergency care and allowing funding for service expansion and equipment purchase when the spending improves pediatric trauma capacity. It authorizes local EMS agencies to perform needs assessments to guide allocation and requires counties without pediatric trauma centers to use the money to improve access and coordination—this makes the allocation both targeted and flexible. The provision carries a sunset date: these rules expire on January 1, 2037, which shapes investment decisions and long‑term planning for pediatric trauma capacity.
Administrative cost cap for 76000.5 monies (temporary)
This subsection mirrors the general administrative cost limit for the Richie’s Fund monies—administrative reimbursement may not exceed actual costs or 10 percent of the money collected—and it is also time-limited to the same January 1, 2037 sunset. That creates a parallel administrative regime for pediatric-trauma-specific dollars and signals legislative intent to limit overhead on those targeted funds while leaving local EMS agencies responsible for operationalizing the cap.
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Who Benefits
- Emergency physicians in general acute care hospitals who are not employed by county hospitals — they receive a dedicated reimbursement stream for uncompensated emergency care and an initial payment in the first reimbursement cycle that can improve near-term cash flow.
- Hospitals that provide disproportionate trauma and emergency medical care — the statute creates a dedicated hospital pool aimed at supporting institutions that shoulder high volumes of uncompensated emergency and trauma care.
- Pediatric trauma centers and children’s hospitals — Richie’s Fund directs targeted funding and the ability to expand pediatric trauma services, buy equipment, and receive reimbursement for uncompensated pediatric emergency care.
- Local EMS agencies and counties — they gain an explicit funding mechanism and discretion over a portion of the fund for local EMS priorities (including poison control centers and regional projects), enabling counties to align funds with local service gaps.
- Patients who lack payment for emergency care — the statute provides a clearer, statutory path to have uncompensated emergency services reimbursed to the providers that treat them, which can support continued local availability of emergency services.
Who Bears the Cost
- County boards of supervisors and county treasury/finance offices — they must adopt resolutions, set up accounting and distribution systems, and, if they administer the fund, absorb administrative workload subject to the 10-percent cap on reimbursement.
- County EMS agencies — expected to perform needs assessments, manage claims intake and reconciliation, and make allocation decisions; these tasks add operational responsibilities and may require new staffing or systems.
- Emergency providers and hospitals — while the fund supplies reimbursements, providers must file qualifying claims, document stabilization timing, and manage partial initial payments and year-end reconciliations, increasing administrative burden.
- Programs previously funded by the same penalty assessments — dedicating these specific penalty dollars to the Maddy EMS Fund reduces discretionary use of that revenue and could crowd out other local programs that formerly relied on the same assessments.
- Counties with low penalty-assessment receipts — these counties will face a shortfall relative to local need, meaning providers in some counties may receive less support than providers in higher‑revenue counties, shifting uncompensated-care burdens unevenly.
Key Issues
The Core Tension
The bill balances two legitimate goals—targeted reimbursements for providers who deliver uncompensated emergency care (including a near-term boost via initial payments) and local control over how EMS priorities are funded—against each other and against fiscal reality: directing penalty-assessment revenue into a structured program improves predictability for certain providers but produces uneven county-level resources, administrative complexity, and planning uncertainty (especially because the pediatric allocation is time-limited). Policymakers and implementers must weigh improved provider support and focused pediatric investment against the administrative costs, revenue volatility, and uneven geographic outcomes the structure creates.
AB 1607 creates an explicitly local funding mechanism, but that localism is also a source of unevenness. Because the fund relies on penalty-assessment receipts, collection differences across counties will translate directly into unequal provider support.
The statute gives counties discretion over a portion of the money and permits reserves, which helps local planning but also allows some counties to prioritize non-provider uses or to underfund reimbursements in tight years. The initial-cycle payment (up to 50 percent for physicians) improves short-term liquidity for providers but creates year‑end reconciliation risk: providers may receive a sizable initial payment only to see smaller residual distributions based on total claims volume and remaining fund balance.
Operationally, the statute assumes counties (or the state, when elected) can administer a claims-based reimbursement program: tracking submitted claims, recording initial cycle payments, holding and then calculating proportional year‑end distributions, and conducting needs assessments for pediatric trauma. Smaller counties may lack the systems and staff to perform these tasks efficiently, and the 10-percent administrative reimbursement cap may not cover necessary start-up investments in software and personnel.
Key terms—such as who qualifies as a hospital providing "disproportionate trauma and emergency medical care," what counts as "stabilized," and the precise claims documentation required—are left to implementing regulations or local policies, which raises the risk of inconsistent application and provider disputes.
The Richie’s Fund is a policy choice with a hard sunset. Targeted pediatric trauma funding can plug specific gaps, but the 2037 expiration forces recipients to treat the money as temporary when considering capital projects and hiring.
The sunset also creates a cliff: counties and hospitals that expand pediatric capacity with these dollars may find themselves without the same support later, which complicates long-term planning. Finally, diverting penalty-assessment revenue to a statutory purpose reduces local flexibility and can create trade-offs with other criminal-justice, court, or county programs that previously depended on the same revenue stream.
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