BILL ANALYSIS �
SENATE HUMAN
SERVICES COMMITTEE
Senator Leland Y. Yee, Chair
BILL NO: SB 163
S
AUTHOR: Hueso
B
VERSION: April 8, 2013
HEARING DATE: April 23, 2013
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FISCAL: Yes
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CONSULTANT: Mareva Brown
SUBJECT
Developmental services: health insurance payments
SUMMARY
This bill requires a regional center to pay any applicable
co-payment, co-insurance, and deductible imposed by a
health insurance policy or health care service plan for a
service or support required by a consumer's Individual
Program Plan (IPP) or Individualized Family Services Plan
(IFSP), as specified, and prohibits regional centers from
charging or seeking reimbursement for these costs.
ABSTRACT
Existing law
1)Establishes the California Department of Developmental
Services (DDS) to administer the Lanterman Developmental
Disabilities Act, which entitles individuals with
developmental disabilities to community services and
supports. (WIC 4500)
2)Defines "developmental disability" as a disability that
originates before the age of 18, continues, or can be
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expected to continue, indefinitely, and constitutes a
substantial disability. This term also includes autism.
(WIC 4512)
3)Establishes that DDS contracts with private non-profit
regional centers to provide fixed points of contact in
the community for persons with developmental disabilities
and their families, so that these persons may have access
to the services and supports best suited to them
throughout their lifetime. (WIC 4620)
4)Establishes that it is the intent of the legislature that
an array of services and supports are provided to
sufficiently meet the needs and choices of each person
with developmental disabilities, regardless of age or
degree of disability, and at each stage of life and to
support their integration into the mainstream life of the
community. To the maximum extent feasible, services and
supports should be available throughout the state to
prevent the dislocation of persons with developmental
disabilities from their home communities. (WIC 4501)
5)Requires every health care service plan and health
insurance policy that provides hospital, medical or
surgical coverage to provide coverage for behavioral
health treatment for autism and related disorders under
the same guidelines that it provides other coverage. (HSC
1374.73) (INS 10144.51)
6)Requires that treatment be provided by a qualified autism
service provider, as specified. (HSC 1374.73 (B) et seq.)
(INS 10144.51 (B) et seq.)
This bill
1) Requires a regional center to pay any applicable
co-payment, co-insurance or deductible associated with
a service or support provided, pursuant to a
consumer's IPP, that is paid for in whole or part by
the consumer's or the consumer's parents' private
health insurance policy or health care service plan.
2) Prohibits a regional center from imposing on the
consumer or the consumer's family, a share of cost
for, or income requirements relating to, payments paid
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for co-payments, co-insurance or deductibles.
3) Prohibits a regional center from seeking
reimbursement for any payments made by a consumer and
his or her family.
4) Permits the regional center to either pay the
family or to provide direct reimbursement to the
family, health insurer or health care service plan,
for payments required.
5) Requires a consumer and his or her family to
provide appropriate documentation to affirm that the
payments required are for services that have been
established under the consumer's IPP or IFSP.
6) Requires a regional center to establish appropriate
application and documentation forms to implement this
section.
FISCAL IMPACT
This bill has not been analyzed by a fiscal committee.
BACKGROUND AND DISCUSSION
Purpose of the bill
The author states that although the existing Lanterman
Development Disabilities Service Act prohibits a regional
center from charging for developmental disability services,
some regional centers require insured individuals to cover
their co-pays for autism services. This appears to be a
result of the 2011 passage of SB 946 (Steinberg) which
required private health plans to cover behavioral health
treatments for autism. After the enactment of that
legislation, a number of regional center consumers were
newly covered by health plans for autism-related benefits.
The author states that behavioral health treatments for
autism may be required as often as 3 to 5 times per week,
which can result in significant co-payments for families
with private health insurance. Requiring regional center
consumers who would otherwise qualify for no-cost services
to co-pay creates unequal treatment for those families who
have been able to secure insurance, according to the
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author.
To address this issue, SB 163 directs regional centers to
provide reimbursement for all co-pays, co-insurance, and
deductibles imposed by health plans for services identified
in a consumer's IPP or IFSP. The author states that this is
consistent with the entitlement provisions of the Lanterman
Act and is necessary so that all regional centers in the
state are consistent in their policies. The author also
states that since the passage of SB 946, a regional
centers' overall financial burden has been reduced.
Insurance coverage of behavioral treatment for autism
In 2011, SB 946 (Steinberg, Chapter 650, Statutes of 2011)
required health care service plans and health insurance
companies in California to begin covering behavioral health
treatment for pervasive developmental disorders or autism.
State law defines intensive behavioral intervention therapy
as any form of Applied Behavioral Analysis that is
comprehensive, designed to address all domains of
functioning, and provided in multiple settings for no more
than 40 hours per week, depending on the individual's needs
and progress. Interventions can be delivered in a
one-to-one or small group format, as appropriate.
An analysis by the California Health Benefits Review
Program (CHBRP) estimated savings from moving ABA services
from DDS to private insurance of about $146 million. CHBRP,
created in 2002 within the University of California system,
responds to Legislative requests to provide independent
analysis of the medical, financial, and public health
impacts of proposed health insurance benefit mandates and
repeals. In its report on coverage of behavioral treatment
services, CHBRP estimated an $17.1 million increase in
out-of-pocket expenses for enrollees with newly covered
benefits.
Governor's budget proposal
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Included in the Governor's January 2013 budget proposal is
$9.9 million annual increase in funding beginning in
2013-14 (and $15 million in current year) for co-payments
for behavioral health services associated with a recent
regional center legal opinion. The Governor's proposed
language limits the funding of health insurance co-payments
based on the family's ability to pay, and prohibits the
payment of deductibles.
In a hearing on April 11, 2013, Subcommittee 3 of the
Senate Committee on Budget and Fiscal Review addressed this
issue, although it took no action pending the May Revise.
The budget proposal limits payments for health insurance
co-pays to families with incomes that do not exceed 400
percent of the federal poverty level and only under certain
circumstances including:
When necessary to ensure that the
consumer receives the service or support.
When health insurance covers the service
in whole or in part.
When there is no third party who is
liable to pay for the cost.
DDS estimated that roughly 50 percent of consumers or
families who would be included under this proposal have
incomes below 400 percent of FPL. DDS has indicated that
regional center practices around co-pays and deductibles
have varied and argued in the budget process that statutory
clarification is necessary to establish a clear statewide
policy.
The question of whether a regional center should cover
deductibles has been controversial, and the department's
proposal does not include deductibles. Some advocates have
argued that it is appropriate to cover families whose
insurance requires deductibles, as families are proposed to
be covered with insurance co-pays. Others have argued that
covering a family's deductible would open the door for the
regional centers to cover services that would not be
allowed under the Lanterman Act, including medical services
for other family members. Some have suggested that families
may wait to have medical treatment for non-covered family
members or medical issues until a regional center has
reimbursed a family for its entire deductible.
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Current practice in regional centers is to pay co-pays and
deductibles on a discretionary basis - when a regional
center determines that it is critical for a consumer to
receive care. One example was a regional center that paid a
$5,000 co-pay for a family that then was able to have
insurance coverage for $28,000 in behavioral services.
Regional Center of the East Bay legal decision
The question of whether to include deductibles was given
more urgency by a Nov. 9, 2012, administrative law ruling
which found that the Regional Center of the East Bay (RCEB)
must pay the insurance deductible for a child in its care.
The case focused on whether the regional center
appropriately discontinued Applied Behavioral Analysis
(ABA) therapy because the 7-year-old boy was covered by his
family's private insurance.
The boy's individual deductible was $6,800 per year, and
the family's annual deductible was $13,600. The child's
father had secured a policy to provide catastrophic health
coverage for his family, but neither the family nor the boy
individually had met the deductible. Yet the regional
center informed the family on Aug. 27, 2012 that it was
discontinuing ABA services at the end of the following
month. The family appealed, arguing that the regional
center should pay for ABA services until the deductible was
satisfied, just as the regional center would be obligated
to pay for services if the family had no insurance. The
family could not afford to pay the monthly cost of ABA
services.
The regional center argued that if it were to reimburse the
family for ABA services throughout the year, the family may
have medical expenses later in the year that would have
satisfied the family deductible; making payment of the ABA
services an unnecessary public expenditure.
The judge ruled that the regional center could not
discontinue funding of ABA services based on the family's
insurance coverage. The family's failure to meet its
deductible independent of ABA services renders the
insurance policy unavailable, according to the legal
opinion, which also noted that this imposes a liability to
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the family that is not imposed on other parents of autistic
consumers who are provided ABA services.
Prior legislation
SB 946 (Steinberg, Chapter 650, Statutes of 2011) required
health care service plans and health insurance policies to
provide coverage for behavioral health treatment for autism
and related disorders, as specified.
SB 166 (Steinberg, 2011) required health care service plans
licensed by the Department of Managed Health Care (DMHC)
and health insurers licensed by the Department of Insurance
(DOI) to provide coverage for behavioral intervention
therapy for autism. It was held in the Senate Health
committee.
SB 770 (Steinberg and Evans 2011) required health plans and
insurers, except plans that contracted with Medi-Cal, to
provide coverage for behavioral health treatment and to
permit licensed or unlicensed providers to provide
services. Held in Assembly Appropriations Committee.
Comments
Staff recommends shifting the responsibility for
establishing documentation forms from the regional centers
to DDS, as follows:
4659.1. (e) The regional center Department of
Developmental Services shall establish appropriate
application and documentation forms to implement this
section.
POSITIONS
Support: Autism Speaks (sponsor)
State Council on Developmental Disabilities
(sponsor)
Alliance of California Autism Organizations
Autism Deserves Equal Coverage
Autism Health Insurance Project
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Autism Society Inland Empire
Autism Society Santa Barbara
Disability Rights California (if amended)
Service Employees International Union (SEIU)
California
The Arc and United Cerebral Palsy in
California
Oppose: None received
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