BILL ANALYSIS Ó
AB 369
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CONCURRENCE IN SENATE AMENDMENTS
AB 369 (Huffman)
As Amended August 24, 2012
Majority vote
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|ASSEMBLY: |48-22|(January 26, |SENATE: |23-11|(August 29, |
| | |2012) | | |2012) |
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Original Committee Reference: HEALTH
SUMMARY : Prohibits health plans and health insurers that
restrict medications for the treatment of pain from requiring a
patient to try and fail on more than two pain medications before
allowing the patient access to the pain medication, or
generically equivalent drug, prescribed by the provider.
The Senate amendments :
1)Delete provisions relating to prior authorization and
authorizing a pharmacist to process a patient's prescription
without additional communication with the health plan or
health insurer when the patient's prescribing provider notes
on the prescription that the plan's or insurer's step therapy
or fail first protocols have been met.
2)Clarify that the prohibition against requiring a patient to
try and fail on more than two pain medications before allowing
the patient access to the pain medication, or generically
equivalent drug, applies unless the label indication approved
by the federal Food and Drug Administration or clinical
research trials, as specified, supports that more than two
prior therapies should be used before providing access to the
requested pain medications.
3)Replace the term "prescribing provider" with the term
"prescribing participating plan provider" in the Health and
Safety Code.
4)Make other technical and clarifying changes.
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version approved by the Senate.
AB 369
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FISCAL EFFECT : According to the Senate Appropriations
Committee:
1)One-time costs of about $40,000 (Managed Care Fund) to the
Department of Managed Health Care to review compliance by
health plans.
2)Minor costs to the Department of Insurance to review
compliance by health insurers.
3)Negligible costs to the California Public Employees'
Retirement System to provide pharmacy benefits to its
subscribers.
4)Unknown potential cost increases to Medi-Cal managed care
plans (50% General Fund, 50% federal funds). The Department
of Health Care Services (DHCS) indicates that it expects there
to be some fiscal impact of the bill, but it is not able to
quantify any potential cost increases at this time. DHCS is
concerned that limiting the use of step therapy will lead to
greater use of more expensive pain medication, when, in some
cases, less expensive medications may provide relief.
COMMENTS : The author states c hronic pain affects more Americans
than diabetes, heart disease, and cancer combined and has
serious economic ramifications. A ccording to the author, in
order to reduce their costs and improve their profit margins,
many health plans utilize step therapy or "fail first" policies
which force patients to try several alternative medications,
which in some cases include over-the-counter medicines, before
they are permitted to get the medication that their physician
ordered. The author asserts that not only does this policy deny
patients the medications they need when they need them, step
therapy can actually increase the direct cost of health care in
the long run due to excessive use of emergency rooms;
unscheduled hospital admissions; permanent damage as a result of
being on the wrong medication; loss of employment; and, loss of
life itself when a person with chronic pain commits suicide.
The author believes that this bill will move the state closer to
changing practices that have resulted in higher long-term health
care costs and forced chronic pain patients to endure
unnecessary physical and emotional suffering.
Chronic pain advocacy groups, health care professionals, and
community organizations support this bill because it will ensure
AB 369
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that patients have access to the right treatment at the right
time. The sponsor of this bill, For Grace, writes that this
bill highlights the inadequacies of step therapy because a pain
patient can tell immediately whether or not a pain medication is
working and should not be forced to stay on medicine that does
not relieve their pain.
It is unclear whether recent clarifying amendments affect the
opposition to this bill from some health plans and pharmacy
benefit managers. The Association of California Life and Health
Insurance Companies remains opposed and believes that this bill
should be limited to contracting providers in order to guard
against fraud and unsafe practices. However, Health Net and the
California Association of Joint Powers Authorities have removed
their opposition, stating that they appreciate the author's
willingness to address their concerns with this measure which
they believed would have unnecessarily interfered with the prior
approval process for prescription drugs.
Analysis Prepared by : Cassie Royce / HEALTH / (916) 319-2097
FN: 0005732