BILL ANALYSIS Ó
SB 946
Page 1
Date of Hearing: September 8, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 946 (Steinberg) - As Amended: September 6, 2011
Policy Committee: HealthVote:13-5
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill requires health insurance plans and health care
service plans to provide coverage for behavioral health
treatment for pervasive developmental disorder or autism
(PDD/A). The bill also contains relatively minor provisions
related to HIV reporting and to the rate-setting for mental
health services in Medi-Cal. Specifically, this bill:
1)Requires every health care service plan or health insurance
policy issued, amended, or renewed on or after July 1, 2012 to
provide coverage for behavioral health treatment, including,
but not limited to, applied behavioral analysis (ABA) therapy,
for (PDD/A).
2)Requires health care service plans and health insurers to
maintain an adequate network of qualified autism service
providers (QASP), defines who is qualified to provide
behavioral health treatment service for PDD/A, and imposes
specific requirements on autism service providers with respect
to treatment plans they prescribe.
3)Is operative until July 1, 2014 and is repealed as of January
1, 2015. As of the date that proposed final rulemaking for
essential health benefits (EHBs) is issued by the federal
Health and Human Services Agency pursuant to the federal
Patient Protection and Affordable Care Act (ACA), this bill
does not require benefits to be provided that exceed the EHBs
that all health plans will be required to cover.
4)States the bill does not affect services provided to an
individual through current programs, including regional
centers, community mental health programs, early intervention
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programs, and schools.
5)Defines behavioral health treatment for PDD/A and creates
standards for treatment plans provided pursuant to this
mandate.
6)Explicitly allows, notwithstanding any other provision of law,
health plans and insurers to use case management, network
provides, utilization review techniques, prior authorization,
co-payments, or other cost-sharing.
7)Requires the Department of Managed Health Care (DMHC) to
convene an Autism Advisory Task Force to make recommendations
regarding behavioral health treatment that is medically
necessary for the treatment of autism and licensure
requirements for autism service providers.
8)Allows the Department of Public Health to make changes to an
HIV reporting form without issuing regulations.
9)Makes minor changes to the rate-setting methodology for
Medi-Cal mental health services in order to align state law
with current practice and federal regulations.
FISCAL EFFECT
1)One-time costs to the DMHC of in the range of $50,000 (special
fund) to conduct a stakeholder process and publish
recommendations.
2)Minor, if any, state health care costs. This bill exempts
health plans provided through Medi-Cal, Healthy Families
Program, and California Public Employees Retirement System
(CalPERS) from the coverage mandate.
3)A California Health Benefits Review Program (CHBRP) analysis
of a similar bill, SB 166 (Steinberg, 2011) identified annual
increased premium costs in the private insurance market of
$177 million. These costs reflect increased premiums by
employers for group insurance, premiums paid in the individual
health insurance market, and premium costs borne by
individuals with group coverage. Because CHBRP's analysis of
SB 166 assumed that behavioral health services would be
delivered by licensed providers, while SB 946 stipulates that
unlicensed providers can deliver services, the costs would
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likely be less than the estimate of $177 million.
4)Potentially significant one-time GF cost savings. CHBRP
reports in their analysis of SB 166 that $146 million in cost
savings annually would accrue to current payers of
PDD/A-related services (primarily school districts and the
state Department of Developmental Services (DDS)).
Given that the mandate to cover behavioral health treatment is
only in effect for a maximum of 18 months beginning July 1,
2012, the volume of services that would transition from
current payers to health plans, and the speed of these
transitions, is unknown. Also, given data limitations, it is
difficult to estimate precisely where cost savings would
accrue. Savings would partially depend on the success of DDS
in identifying other payers.
One-time GF cost savings to DDS associated with SB 946 could
be in the range of tens of millions of dollars in budget year
2012-13, assuming individuals transitioned quickly from
services provided by DDS and schools to services reimbursed by
health plan and insurers. Savings in 2013-14 would be similar
in magnitude but would only be accrued for the first six
months of the fiscal year. School districts would not
experience direct GF savings if K-12 education was funded at
the minimum amount required by Proposition 98. However, any
funds saved by school districts due to a reduction in
expenditures for PPD/A-related services could be redirected to
other activities.
5)As the bill is currently drafted, no state fiscal liability
related to the ACA. The ACA creates new state-run health
insurance exchanges that will likely provide coverage to
millions of Californians, and requires that health plans
offered through an exchange cover certain categories of
benefits, called Essential Health Benefits (EHBs). The
Secretary of Health and Human Services (HSS) is expected to
publish guidance later in 2011 and in 2012 that will further
define these categories. These definitions will have important
fiscal implications for the state. The ACA specifies that if
states require plans in the exchange to offer additional
benefits that go beyond the defined EHBs, then states must pay
the additional cost related to those mandates.
At this time, there are a number of outstanding questions
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related to how federally defined EHBs will interact with
state-level benefit mandates. CHBRP indicates that EHBs
explicitly include "mental health and substance abuse disorder
services, including behavioral health treatment" as well as
"rehabilitative and habilitative services and benefits." It is
unknown whether the mandate in SB 946 would go beyond what
will be included in federally defined EHBs, but it is
plausible that EHBs may not mandate coverage of ABA.
To mitigate potential fiscal concerns, SB 946 does not mandate
benefits beyond those defined as EHBs. Thus, it is unlikely
that there would be an additional fiscal liability to the
state as a result of this mandate for qualified health plans
offered in the Exchange, because the state-mandated
requirement to cover ABA would be triggered off if EHBs do not
require ABA to be covered. However, if the requirement was
triggered off, children both inside and outside the Exchange
could lose coverage, raising potential policy issues related
to disruption of treatment. On the other hand, if the
operative dates of the coverage mandate were extended, the
state could incur significant fiscal liability related to the
marginal cost of this mandate for individuals in the Exchange.
COMMENTS
1)Rationale . According to the author, SB 946 provides clarity
in the law by mandating that health plans and insurers cover
behavioral health treatment, such as Applied Behavioral
Analysis (ABA), for those with autism. The author also defines
the scope of these treatments and who is qualified to provide
them. The author contends this clarification will save
struggling families from the bureaucratic hurdles many face in
getting this treatment covered by health plans and insurers.
(A similar bill to SB 946, SB 770 (Steinberg), was heard in
this committee on August 24, 2011 and is currently pending on
this committee's Suspense file.
A previous version of SB 946 was heard in this committee on
August 16, 2011. As amended on May 10, 2011, SB 946 was
authored by the Committee on Health and dealt with various
technical or non-controversial issues related to public
health. Most of the provisions relating to public health,
present in the May 10 version, were removed and replaced by
language related to the autism mandate. Provisions relating
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to HIV reporting and to the rate-setting for mental health
services in Medi-Cal remain in the current bill. )
2)Mental Health Parity . Under current law, California has had
partial mental health parity for specified conditions since AB
88 (Thompson), Chapter 524, Statutes of 1999. AB 88 requires
treatment parity for serious mental illness (SMI) such as
schizophrenia, autism, and anorexia nervosa. This bill would
further specify that behavioral health treatment for PDD/A
must be covered.
3)Applied Behavioral Analysis . CHBRP's analysis of a similar
bill indicates that it would result in significant increases
in coverage of behavioral health treatment for PDD/A. Because
the largest impact would be an increase in ABA therapy and
similar services, both CHBRP's analysis and this analysis
focus on ABA. ABA is the process of systematically applying
interventions based upon the principles of learning theory to
improve socially significant behaviors to a meaningful degree.
Socially significant behaviors include reading, academics,
social skills, communication, and adaptive living skills like
motor skills, eating and food preparation, personal self-care,
domestic skills, home and community orientation, and work
skills.
ABA requires intensive treatments of more than 25 hours each
week and costs about $50,000 each year. Consumers complain
about the refusal of health care service plans to cover ABA
services. Some independent medical reviews (IMRs) of health
plan coverage denials for ABA services for children diagnosed
with autism have overturned the health plan's decision to deny
coverage, while others have not.
4)Effectiveness of ABA . CHBRP indicates that the literature on
the effectiveness of behavioral intervention therapies (BIT),
of which ABA is the most popular, is difficult to synthesize
since most studies compared intensive behavioral intervention
therapies of differing duration and intensity or compared
interventions based on different theories of behavior. Thus,
most studies of intensive behavioral intervention therapy
cannot determine whether BIT improves outcomes relative to no
treatment; they can only determine whether some form of BIT is
more effective than others.
CHBRP notes that even this question is difficult to answer
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because the characteristics of treatments provided to both
intervention and comparison groups vary widely across studies.
Additionally, CHBRP states that many studies of BIT do not
assess outcomes over sufficiently long periods of time to
determine whether use of these therapies is associated with
long-term benefits.
In conclusion, CHBRP indicates there is some support that BIT,
including ABA, can improve IQ and adaptive behavior as
compared to other types of treatment. However, the increases
in IQ were not sufficiently large to enable the children to
achieve levels of intellectual and educational functioning
similar to their peers without PDD/A.
5)Current Enforcement Action and Litigation Over Coverage of
ABA . Health plan coverage of ABA is an area of significant
ongoing disagreement between health plans and insurers and
their regulatory oversight agencies, the Department of Managed
Health Care (DMHC) and the California Department of Insurance
(CDI). The areas of disagreement are many: whether ABA is a
medical service, whether it is required to be covered under
current mental health parity law, whether it must be provided
by licensed providers, whether coverage limitations are legal,
and whether an IMR of the medical necessity of ABA is
appropriate when it is not considered by the health plan to be
a covered benefit. Health plans regulated by DMHC indicate
they currently provide comprehensive coverage for
autism-related medical services, including diagnosis,
assessment, medication and speech, physical, rehabilitative
and occupational therapies.
In recent years, a more aggressive regulatory stance from
these two agencies, based upon their interpretation that
California's mental health parity laws require coverage of
ABA, has led to enforcement action by CDI against Blue Shield.
An action brought against Blue Shield earlier this year is
pending hearing in January 2012, and CDI reports there is one
additional enforcement action pending related to failure to
cover ABA. It has also led to settlements in July 2011
between DMHC and Anthem Blue Cross and Blue Shield, which were
signed in order to avoid enforcement action. The settlements
require limited coverage of ABA by licensed providers, or
providers supervised by licensed providers. Autism advocates
argue that these settlements unduly relieve plans from prior
violations of the Knox-Keene Act that governs health plan
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coverage, and do not go far enough to make coverage accessible
to children diagnosed with PDD/A.
Also, in a January 2011 Los Angeles County Superior Court
ruling, a judge affirmed DMHC's position that providers of ABA
must be licensed by the state, a position that autism
advocates still dispute. In May of this year, the California
Association of Health Plans (CAHP) filed suit against DMHC in
Sacramento County Superior Court, challenging DMHC's authority
to require health plans to cover ABA. CAHP sought a summary
judgment to quickly resolve the issue of whether DMHC has the
authority to mandate such coverage; however, the motion for
summary judgment was denied in late August 2011, meaning the
lawsuit will proceed.
6)Other Payers of ABA Services . In California, a number of
entities pay for or directly provide ABA services, including
school districts, the state Department of Developmental
Services, and individuals, as well as health care and health
insurance plans. As indicated above, CHBRP reports in their
analysis of a similar bill that increased premium costs in
public and private programs are offset by reductions in
expenditures by individuals and other payers on newly covered
benefits (such as behavioral intervention therapy (BIT)
services) of $146 million.
7)Related Legislation .
SB 166 (Steinberg) and SB 770 (Steinberg) are similar to SB
946. They both require health plans and insurers to cover
behavioral intervention therapy as a treatment for autism. SB
166 was held in the Senate Health Committee and SB 770 is
pending on the Suspense File of this committee.
As compared to SB 770, key changes included in SB 946 include:
1) SB 946 provides more specificity about who can prescribe
and provide behavioral treatment services.
2) SB 946 further specifies that "behavioral health
treatment" means services and treatment programs that
"develop or restore, to the maximum extent practicable, the
functioning of an individual with ÝPDD/A]."
3) SB 946 specifies certain requirements with respect to
treatment plans and autism service providers who prescribe
the plans.
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4) The coverage mandate in SB 946 is only operative from
July 1, 2012 until January 1, 2014 and is repealed as of
January 1, 2015, and does not require coverage beyond EHBs
as of the date that EHBs are defined by the federal
government.
5) SB 946 explicitly allows, notwithstanding any other
provision of law, carriers to use case management, network
provides, utilization review techniques, prior
authorization, co-payments, or other cost-sharing.
6) SB 946 exempts plans offered through the Healthy
Families Program and CalPERS from the coverage mandate.
7) SB 946 requires the DMHC to convene an Autism Advisory
Task Force to make recommendations regarding behavioral
health treatment that is medically necessary for the
treatment of autism and licensure requirements for autism
service providers.
AB 171 (Beall) is similar to, though slightly more expansive
than, SB 166, SB 770, and SB 946. AB 171 requires health
insurance plans and health care service plans to provide
coverage for screening, diagnosis, and treatment services
associated with autism spectrum disorders (ASDs), and defines
certain types of services that must be covered to treat ASDs.
AB 171 is pending on the Suspense File of this committee.
AB 1205 (Berryhill) requires the Board of Behavioral Sciences
(BBS) to license behavioral analysts (BA) and assistant BAs.
AB 1205 was held on the Suspense File of this committee.
Other Health Mandates in the Current Session. There were 19
health mandates proposed for legislative consideration this
year, including SB 946. Some have since been amended into
another subject matter. Other proposed health mandates and
their disposition are as follows:
Pending on this committee's Suspense File:
a) AB 72 (Eng): Acupuncture
b) AB 137 (Portantino): Mammography
c) AB 154 (Beall): Mental Health Services
d) AB 171 (Beall): Behavioral Intervention Therapy
e) AB 185 (Hernandez): Maternity Services
f) AB 310 (Ma): Prescription Drugs
g) AB 369 (Huffman): Pain Prescriptions
h) AB 428 (Portantino): Fertility Preservation
i) AB 652 (Mitchell): Child Health Assessments
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j) AB 1000 (Perea): Cancer Treatment
aa) SB 155 (Evans): Maternity Services
bb) SB 173 (Simitian): Mammograms (Mandate amended out)
cc) SB 770 (Steinberg): Behavioral Intervention Therapy
Pending in Senate Health Committee:
dd) SB 166 (Steinberg): Behavioral Intervention Therapy
ee) SB 255 (Pavley): Breast Cancer (Pending in Senate
Health Committee)
Amended to a different subject matter:
ff) SB 136 (Yee): Tobacco Cessation
Pending on the Senate floor:
gg) SB 222 (Evans): Maternity services, individual
market
Enrolled:
hh) AB 210 (R. Hernández): Maternity services, group
market
Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081