BILL ANALYSIS Ó
AB 219
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Date of Hearing: April 17, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 219 (Perea) - As Introduced: February 4, 2013
Policy Committee: HealthVote:15-2
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill prohibits health plan contracts and health insurance
policies that cover prescribed, orally administered anticancer
medications, from requiring an enrollee or ensured to pay
cost-sharing of more than $100 per filled prescription.
FISCAL EFFECT
According to the California Health Benefits Review Program
(CHBRP), this bill's provisions would likely have a negligible
impact on the state because the programs affected CalPERS and
Medi-Cal, already provide coverage with cost-sharing below the
amounts in this bill.
Minor costs to the Department of Managed Health Care (DMHC) and
the Department of Insurance (CDI) for plan filings.
COMMENTS
1)Rationale . In recent years, advances in cancer treatment have
led to the availability of oral medications that are more
effective than traditional intravenous or injectable
medications, with fewer side effects. These newer drugs tend
to be expensive and are reimbursed according to a health
plan's pharmacy benefit schedule, whereas older intravenous or
injectable medications administered in a physician's office
may be covered as a simple medical office visit. For example,
health plans often use tiered payment systems for prescription
drug cost sharing; a new and expensive drug costing $10,000
could be a 3rd or 4th tier drug with a $3,000 (30%) patient
co-pay. High out-of-pocket costs sometimes lead patients to
abandon their medication regimes. The author points out that
AB 219
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21 other states have passed legislation to address the high
cost of these treatments. The American Cancer Society and
numerous other organizations support this bill.
2)Prior Legislation . Similar though not identical measures were
vetoed in past years. AB 1000 (Perea) of 2012, SB 961
(Wright) of 2010 and SB 161 (Wright) of 2009 all tackled the
issue of costly anticancer orally administered medications.
In the most recent veto message, for AB 1000, the governor
supported the author's efforts but expressed concern that this
bill does not distinguish between "plans and insurers who make
these drugs available at a reasonable cost and those who do
not." The governor added he would direct DMHC to work on
alternative approaches with the author and stakeholders.
3)Insurer Concerns . Health plans and insurers generally oppose
this bill, arguing this proposal and other legislation
affecting benefits will interfere with product design in
Covered California, the state's health benefit exchange. They
also assert the bill does not attack the real problem, which
is the high underlying cost of pharmaceuticals.
Across-the-board price regulation unrelated to the underlying
cost is unreasonable considering the very high cost of some of
these drugs.
Analysis Prepared by : Debra Roth / APPR. / (916) 319-2081