BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



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          |SENATE RULES COMMITTEE            |                   SB 946|
          |Office of Senate Floor Analyses   |                         |
          |1020 N Street, Suite 524          |                         |
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                              UNFINISHED BUSINESS


          Bill No:  SB 946
          Author:   Steinberg (D) and Evans (D), et al.
          Amended:  9/8/11
          Vote:     21

           
          PRIOR VOTES NOT RELEVANT 

           ASSEMBLY FLOOR  :  Not available


           SUBJECT  :    Health care coverage:  mental illness:  
          pervasive 
                      developmental disorder or autism:  public 
          health

           SOURCE  :     Alliance of California Autism Organizations
                      Autism Speaks 
                      Special Needs Network 
                      The Help Group 


           DIGEST  :    This bill requires health plans and health 
          insurance policies to cover behavioral health therapy for 
          pervasive developmental disorder or autism, requires plans 
          and insurers to maintain adequate networks of autism 
          service providers, establishes an Autism Advisory Task 
          Force in the Department of Managed Health Care, sunsets 
          this bill's autism mandate provisions on July 1, 2014, and 
          makes other technical changes to existing law regarding HIV 
          reporting and mental health services payments. 

           Assembly Amendments  delete the version of the bill that 
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          passed the Senate, regarding "telehealth," and now 
          establishes an Autism Advisory Task Force in the Department 
          of Managed Health Care, and requires health plans and 
          health insurance policies to cover behavioral health 
          therapy for pervasive developmental disorder, or autism. 

           ANALYSIS  :    

          Existing law:  

          1. Enacts, in federal law, the Patient Protection and 
             Affordable Care and Education Reconciliation Act of 2010 
             (PPACA) to, among other things, make statutory changes 
             affecting the regulation of, and payment for, certain 
             types of private health insurance.  Includes the 
             definition of essential health benefits (EHBs) that all 
             qualified health plans must cover, at a minimum, with 
             some exceptions.

          2. Provides that the EHB package in #1 above will be 
             determined by the federal Department of Health and Human 
             Services (HHS) Secretary and must include, at a minimum, 
             ambulatory patient services; emergency services; 
             hospitalizations; mental health and substance abuse 
             disorder services, including behavioral health; 
             prescription drugs; and rehabilitative and habilitative 
             services and devices, among other things.

          3. Establishes the Knox-Keene Health Care Service Plan Act 
             of 1975 (Knox-Keene) to regulate and license health 
             plans and specialized health plans by the Department of 
             Managed Health Care (DMHC) and provides for the 
             regulation of health insurers by the Department of 
             Insurance (CDI).

          4. Requires every health plan contract or health insurance 
             policy issued, amended, or renewed on or after July 1, 
             2000, that provides hospital, medical, or surgical 
             coverage to provide coverage for the diagnosis and 
             medically necessary treatment of severe mental illness 
             (SMI) of a person of any age, and of serious emotional 
             disturbances of a child, under the same terms and 
             conditions applied to other medical conditions, as 
             specified.

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          5. Establishes the California Legislative Blue Ribbon 
             Commission on Autism, until November 30, 2008, to study 
             and investigate the early identification and 
             intervention of Autism Spectrum Disorders (ASDs), gaps 
             in programs and services available to those with ASDs, 
             and to make recommendations to address gaps in services.

          6. Requires the Department of Developmental Services (DDS) 
             to develop procedures for the diagnosis of ASDs.

          This bill:

          1. Requires every health plan contract that provides 
             hospital, medical, or surgical coverage and health 
             insurance policy to provide coverage for behavioral 
             health therapy (BHT) for pervasive developmental 
             disorder or autism (PDD/A), no later than July 1, 2012.  


          2. Requires the coverage to be provided in the same manner 
             and to be subject to the same requirements as provided 
             in California's mental health parity law.

          3. Provides, notwithstanding #1 above, as of the date that 
             proposed final rulemaking for EHBs is issued, that this 
             bill does not require any benefits to be provided that 
             exceed the EHBs that all health plans will be required 
             by federal regulations to provide under the federal 
             PPACA, as amended by the federal Health Care and 
             Education Reconciliation Act of 2010.

          4. Precludes this bill from affecting developmentally 
             disabled and early intervention services for which an 
             individual is eligible, as specified.

          5. Precludes this bill from affecting or reducing any 
             obligation to provide services under an individualized 
             education program, an individualized service plan, or 
             under the Individuals with Disabilities Education Act 
             and its implementing regulations, as specified.

          6. Requires every health plan and insurer subject to this 
             bill to maintain an adequate network that includes 

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             qualified autism service providers who supervise and 
             employ qualified autism service professionals or 
             paraprofessionals who provide and administer BHT.  
             Permits health plans and insurers to selectively 
             contract with providers within these requirements.

          7. Defines "PDD/A" as the same meaning in California's 
             mental health parity law.

          8. Defines "BHT" as professional services and treatment 
             programs, including applied behavior analysis (ABA) and 
             evidence based behavior intervention programs, that 
             develop or restore, to the maximum extent practicable, 
             the functioning of an individual with PDD/A and that 
             meet the following:

             A.    Is prescribed by a licensed California physician 
                and surgeon, or is developed by a psychologist.

             B.    Is provided under a treatment plan prescribed by a 
                qualified autism service provider and administered by 
                one of the following: 

                (1)      A qualified autism service provider.
                (2)      A qualified autism service professional 
                   supervised and employed by the qualified autism 
                   service provider.

                (3)      A qualified autism service paraprofessional 
                   supervised and employed by a qualified autism 
                   service provider.

             C.    The treatment plan, which must be reviewed no less 
                than once every six months, as specified, has 
                measurable goals over a specific timeline that is 
                developed and approved by the qualified autism 
                service provider for the specific patient being 
                treated.  

          9. Defines a "qualified autism service provider" as either 
             of the following:

             A.    A person, entity, or group that is certified by a 
                national entity, such as, but not limited to, the 

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                Behavior Analyst Certification Board, that is 
                accredited by the National Commission for Certifying 
                Agencies, and who designs, supervises, or provides 
                treatment for PDD/A, provided the services are within 
                the experience and competence of the person, entity, 
                or group that is nationally certified; or,

             B.    A person or entity licensed as a physician and 
                surgeon, physical therapist, occupational therapist, 
                psychologist, marriage and family therapist, 
                educational psychologist, clinical social worker, 
                professional clinical counselor, speech-language 
                pathologist, or audiologist who designs, supervises, 
                or provides treatment for PDD/A, provided the 
                services are within the experience and competence of 
                the licensee.

          10.Defines a "qualified autism service professional" as an 
             individual who provides behavioral health treatment, is 
             employed and supervised by a qualified autism service 
             provider, provides treatment pursuant to a treatment 
             plan developed and approved by the qualified autism 
             service provider, is a behavioral service provider 
             approved as a vendor by a California regional center to 
             provide services as an Associate Behavior Analyst, 
             Behavior Analyst, Behavior Management Program, and has 
             training and experience in providing services for PDD/A, 
             as specified.

          11.Defines a "qualified autism service paraprofessional" as 
             an unlicensed and uncertified individual who is 
             supervised and employed by a qualified autism service 
             provider, provides treatment and implements services 
             pursuant to a treatment plan, meets the criteria set 
             forth in regulations, as specified, and has adequate 
             education, training and experience, as certified by a 
             qualified autism service provider.

          12.Requires DMHC, in consultation with the CDI, to convene 
             a Task Force by February 1, 2012, in collaboration with 
             other agencies, departments, advocates, autism experts, 
             health plan representatives, other entities, and 
             stakeholders that it deems appropriate.  Requires the 
             Task Force to develop recommendations regarding BHT that 

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             are medically necessary for the treatment of individuals 
             with autism or pervasive developmental disorder, and at 
             least the following:

             A.    Interventions that have been scientifically 
                validated and have demonstrated clinical efficacy.

             B.    Interventions that have measurable treatment 
                outcomes.

             C.    Patient selection, monitoring, and duration of 
                therapy.

             D.    Qualifications, training and supervision of 
                providers.
              
             E.    Adequate networks of providers.

          13.Requires the Task Force to also develop recommendations 
             regarding the education, training and experience 
             requirements that unlicensed individuals providing 
             autism services must meet to secure a license from the 
             State.

          14.Requires DMHC to submit a report of the Task Force to 
             the Governor, President pro Tem of the Senate, the 
             Speaker of the Assembly, and the Senate and Assembly 
             Committees on Health by December 31, 2012, on which date 
             the Task Force ceases to exist.

          15.Exempts from this bill a specialized health plan or 
             health insurance policy that does not deliver mental 
             health or behavioral health services to enrollees, or an 
             accident only, specified disease, hospital indemnity, or 
             Medicare supplement policy, a health plan contract or 
             health insurance policy under Medi-Cal or Healthy 
             Families, and a health care benefit plan or contract 
             pursuant to the California Public Employees' Retirement 
             System (CalPERS).

          16.Provides that nothing in this bill be construed to limit 
             the obligation to provide services under California's 
             mental health parity law.


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          17.Permits a health plan or health insurer to utilize case 
             management, network providers, utilization review 
             techniques, prior authorization, copayments, or other 
             cost sharing, as provided in California's mental health 
             parity law.

          18.Defines, for the purposes of Insurance Code provisions 
             of this bill, "provider," "professional provider," 
             "network provider," "mental health provider," and 
             "mental health professional" to include the term 
             "qualified autism service provider" as defined.

          19.Sunsets the provisions of this bill on July 1, 2014.
           
           20.Authorizes the Department of Public Health to develop a 
             form to be used to report cases of HIV infection to the 
             local health department and permits the form to be 
             implemented without promulgating new regulations.

          21.Conforms state law to existing federal regulations and 
             current practice of the Department of Mental Health 
             (DMH) with regard to negotiated rates and incentive 
             payments for the provision of Medi-Cal reimbursable 
             community mental health services. 

           Background
           
          1.  BHT  .  In discussions surrounding this and other related 
             bills, terminology is used interchangeably to refer to 
             presumably the same or similar types of therapy for the 
             treatment of PDD/A.  The California Health Benefits 
             Review Program (CHBRP) analysis of SB 166 (Steinberg), a 
             bill similar to this bill, refers to intensive 
             behavioral intervention therapy, which CHBRP considers 
             interventions based on ABA and/or other theories of 
             behavior.  State law defines intensive behavioral 
             intervention therapy as any form of ABA that is 
             comprehensive, designed to address all domains of 
             functioning, and provided in multiple settings for no 
             more than 40 hours per week, across all settings, 
             depending on the individual's needs and progress. 
             Interventions can be delivered in a one-to-one ratio or 
             small group format, as appropriate.  The CDI compiled 
             material on the scientific medical literature on the use 

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             of BHT/behavioral intervention therapy, including ABA.  
             This bill refers to BHT as professional services and 
             treatment programs, including ABA and other behavior 
             intervention programs, as specified.  ABA, which is 
             defined in state law as the design, implementation, and 
             evaluation of systematic instructional and environmental 
             modifications to promote positive social behaviors and 
             reduce or ameliorate behaviors which interfere with 
             learning and social interaction, seems to be at the 
             center of coverage disputes, settlements and litigation. 
              

          2.  PDD/A  .  According to CHBRP, PDD/A includes 
             neurodevelopmental disorders that typically become 
             symptomatic in children aged two to three years, but may 
             not be diagnosed until age five years or older.  CHBRP 
             considers five disorders as PDD/A (Autism, Asperger's 
             Disorder, Pervasive Developmental Disorder, Rett's 
             Disorder and Childhood Disintegrative Disorder).  ASD is 
             also used but sometimes excludes less common disorders 
             that are technically part of PDD/A.

          3.  Current Parity Law  .  In 1999, the Legislature passed and 
             the Governor signed AB 88 requiring health plans and 
             health insurers to provide coverage for the diagnosis 
             and medically necessary treatment of certain SMIs of a 
             person of any age, and of serious emotional disturbances 
             of a child, as defined, under the same terms and 
             conditions applied to other medical conditions.  Nine 
             specific diagnoses are considered SMI: schizophrenia; 
             schizoaffective disorder; bipolar disorder; major 
             depressive disorder; panic disorder; obsessive 
             compulsive disorder; PDD/A; anorexia nervosa; and, 
             bulimia nervosa.  For covered conditions, health plans 
             are required to eliminate benefit limits and 
             share-of-cost requirements that have traditionally 
             rendered mental health benefits less comprehensive than 
             physical health coverage.  Current state law requires 
             mental health parity benefits to include outpatient 
             services, inpatient hospital services, partial hospital 
             services, and prescription drugs, if the health plan 
             contract includes coverage for prescription drugs.  
             Current state regulations require parity coverage for at 
             least, in addition to all basic and other health care 

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             services required by Knox-Keene, crisis intervention and 
             stabilization, psychiatric inpatient services, including 
             voluntary inpatient services, and services from licensed 
             mental health providers.

             The federal Mental Health Parity and Addiction Equity 
             Act (MHPA) requires group health insurance plans to 
             cover mental illness, including ASDs, on the same terms 
             and conditions as other illnesses and helps to end 
             discrimination against those who seek treatment for 
             mental illness.  The MHPA does not mandate group health 
             plans provide any mental health coverage.  However, if a 
             plan does offer mental health coverage, then it requires 
             equity in financial requirements, such as deductibles, 
             co-payments, coinsurance, and out-of-pocket expenses; 
             equity in treatment limits, such as caps on the 
             frequency or number of visits, limits on days of 
             coverage, or other similar limits on the scope and 
             duration of treatment; and, equality in out-of-network 
             coverage.  The MHPA applies to all group health plans 
             for plan years beginning after October 3, 2009, and 
             exempts small firms of 50 or fewer employees.

          4.  Independent Medical Review (IMR)  .  Individuals covered 
             by health plans or health insurers in California are 
             entitled to an IMR if a health plan or insurer denies 
             health care services or payment for health care services 
             based on medical necessity.  An IMR is a process where 
             expert independent medical professionals are selected to 
             review specific medical decisions made by the plans or 
             insurers.  DMHC and CDI administer the IMR program to 
             enable consumers to request an impartial appraisal of 
             medical decisions within certain guidelines specified in 
             law.  An IMR can only be requested if the plan or 
             insurer's decision involves the medical necessity of a 
             treatment, an experimental or investigational therapy 
             for certain medical conditions, or a claims denial for 
             emergency or urgent medical services.  According to CDI, 
             since 2009, 32 behavioral intensive therapy or applied 
             behavioral analysis cases have gone to IMR and 28 were 
             overturned.   According to the DMHC, since 2009, 93 
             percent of 148 disputes brought to DMHC by consumers, 
             whose health plans have denied some form of autism 
             treatment, have been resolved in favor of the consumer.

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          5.  EHBs  .  The PPACA requires qualified health plans to 
             cover specified categories of EHBs, including BHT and 
             rehabilitative services, by 2014.  The HHS Secretary is 
             tasked with defining these benefit categories through 
             regulation so that they mirror those benefits offered by 
             a "typical" employer plan.  Qualified plans are required 
             to cover EHBs by 2014.  Federal guidance with respect to 
             EHBs is expected later this year and in 2012.  In a 
             January 2011 issue brief by the CHBRP focusing on the 
             federal requirement to cover EHBs, CHBRP notes that 
             there is considerable legal ambiguity over how state 
             mandates requiring the coverage of the treatment for a 
             specific condition or disease will interact with federal 
             law.  CHBRP states that these mandates often extend 
             across multiple benefit categories.  CHBRP cites, as an 
             example, California's mandate to cover breast cancer 
             treatment, which implicitly requires coverage for 
             screening and testing, medically necessary physician 
             services, ambulatory services, prescription drugs, 
             hospitalization, and surgery.  CHBRP writes that it is 
             unclear how California benefit mandates that overlap 
             across several EHB categories would be evaluated in 
             relation to the EHB package.

          6.  CHBRP  .  CHBRP was created in response to AB 1996 
             (Thomson), Chapter 795, Statutes of 2002, which requests 
             the University of California to assess legislation 
             proposing a mandated benefit or service, and prepare a 
             written analysis with relevant data on the public 
             health, medical, and economic impact of proposed health 
             plan and health insurance benefit mandate legislation.  
             Among CHBRP's findings of their analysis of SB 166 are 
             the following:

             A.     Medical Effectiveness  .  The literature is 
                difficult to synthesize because most studies compared 
                intensive behavioral intervention therapies of 
                differing duration and intensity or compared 
                interventions based on different theories of 
                behavior.  Many of the studies do not assess outcomes 
                over sufficiently long periods of time to determine 
                long-term benefits.  However, CHBRP did determine 
                that the preponderance of evidence from some 

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                meta-analyses suggest that intensive behavioral 
                therapy on applied behavioral analysis is more 
                effective than therapies based on other theories or 
                less intensive therapies in improving adaptive 
                                                                                             behavior, increasing intelligence quotient, and in 
                improving expressive language.

             B.     Utilization, Cost, and Coverage Impacts  .  CHBRP 
                estimates that the postmandate, new benefit coverage 
                would result in a net decrease in expenses for 
                noncovered benefits for an estimated 7,300 enrollees 
                with PDD/A (who use intensive behavioral therapies) 
                of about $146 million.  CHBRP assumes this 
                postmandate shift would represent a savings for 
                enrollees, their families, charities, DDS, California 
                Department of Education, and other payors.  The 
                extent to which the shift would result in a reduction 
                in financial burden for enrollees with PDD/A (and 
                their families) is unknown.    CHBRP estimates an 
                increase in total expenditures by $93.3 million for 
                the insured population resulting from $222.4 million 
                increase in health insurance premiums, and a $17.1 
                million increase in out-of-pocket expenses for 
                enrollees with PDD/A with newly covered benefits.

             C.     Public Health Impact  .  CHBRP estimates there could 
                be some improvements to intelligence quotient and 
                adaptive behaviors for children aged 18 months to 
                nine years with diagnoses of PDD/A due to the 
                effectiveness of intensive behavioral intervention 
                therapy and increased benefit coverage on 
                utilization.  The public health impact on persons 
                outside of this age range or with other PDDs is 
                unknown.  CHBRP found no literature or data regarding 
                the possible differential use or outcomes by gender.  
                The public health impact on reducing potential racial 
                and ethnic disparities of PDD/A symptoms is unknown.  
                There is an increased risk of premature death 
                associated with PDD/A, but CHBRP found no evidence 
                that intensive behavioral intervention therapies 
                would reduce premature death for the population.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  Yes

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          According to the Senate Appropriations Committee:

                          Fiscal Impact (in thousands)

           Major Provisions      2011-12     2012-13     2013-14     Fund  

          DMHC oversight      $0        in the low hundreds 
          ofSpecial*
                                        thousands of dollars

          Potential cost shift from     unknown, potentially in the 
          millions            General**
          public to private payers      to tens of millions of 
          dollars in cost
                              avoidance

          * Managed Care Fund
          **Likely mostly General Fund and Proposition 98 flexibility

           SUPPORT  :   (Verified  9/9/11)

          Alliance of California Autism Organizations (co-source)
          Autism Speaks (co-source)
          Special Needs Network (co-source)
          The Help Group (co-source)
          Association of Regional Center Agencies 
          Department of Insurance
          East Bay Developmental Disabilities Legislative Coalition
          San Mateo County Supervisor, Dave Pine
          The Arc and United Cerebral Palsy in California

           ARGUMENTS IN SUPPORT  :    According to the author's office, 
          this bill is sponsored by the Alliance of California Autism 
          Organizations, Autism Speaks, Special Needs Network, and 
          The Help Group.  The Association of Regional Center 
          Agencies supports this bill for many reasons including that 
          it will save the state millions of dollars through 
          offsetting regional center funds towards funding autism 
          health-related treatment and services, which could be used 
          to support other segments of the regional center 
          population.



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          CTW:mw  9/9/11   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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