BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 68|
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THIRD READING
Bill No: AB 68
Author: Waldron (R)
Amended: 8/18/15 in Senate
Vote: 21
SENATE HEALTH COMMITTEE: 9-0, 7/15/15
AYES: Hernandez, Nguyen, Hall, Mitchell, Monning, Nielsen,
Pan, Roth, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/27/15
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
ASSEMBLY FLOOR: 78-0, 6/3/15 - See last page for vote
SUBJECT: Medi-Cal
SOURCE: Author
DIGEST: This bill requires a Medi-Cal beneficiary to be
entitled to an automatic urgent appeal, as defined, when a
Medi-Cal managed care plan denies coverage for a drug prescribed
for the treatment of seizures and epilepsy that is approved by
the Food and Drug Administration (FDA) for the use in the
treatment of seizures and epilepsy if the patient's treating
provider demonstrates that in his or her reasonable,
professional judgment, the drug is medically necessary and
consistent with FDA labeling and use rules and regulations, as
supported in at least one of the official compendia, and the
drug is not on the formulary of the Medi-Cal managed care plan.
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ANALYSIS:
Existing law:
1)Establishes the Medi-Cal program, administered by the
Department of Health Care Services (DHCS), under which basic
health care services are provided to qualified low-income
persons.
2)Requires the mandatory enrollment of specified Medi-Cal
beneficiaries into Medi-Cal managed care plans.
3)Requires a Medi-Cal managed care plan that has prescription
drugs as one of its benefits and that enters into a contract
with DHCS to ensure the timely and efficient processing of
authorization requests for drugs, when prescribed for plan
enrollees, that are covered under the terms of the plan's
contract with DHCS and which require prior authorization from
the plan, by providing both of the following:
a) A response within 24 hours or one business day to a
request for prior authorization made by telephone or other
telecommunication device.
b) The dispensing of at least a 72-hour supply of a
covered outpatient drug in an emergency situation.
4)Requires, pursuant to regulation, Medi-Cal applicants or
beneficiaries to have the right to a state hearing (known as a
"fair hearing") if dissatisfied with any action or inaction of
the county department, DHCS or any person or organization
acting in behalf of the county or DHCS relating to Medi-Cal
eligibility or benefits.
5)Requires health plans licensed under the Knox-Keene Act
(Medi-Cal plans, with the exception of county organized health
systems and PACE (Program of All-inclusive Care for the
Elderly) plans are required to be Knox-Keene licensed) to do
all of the following:
a) Establish and maintain a grievance system approved by
the Department of Managed Health Care, under which
enrollees may submit their grievances to the plan.
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Requires an expedited plan review of grievances for cases
involving an imminent and serious threat to the health of
the patient, including, but not limited to, severe pain,
potential loss of life, limb, or major bodily function;
b) Maintain an expeditious sprocess by which prescribing
providers may obtain authorization for a medically
necessary non-formulary prescription drug; and,
c) Provide an enrollee with the opportunity to seek an
independent medical review whenever health care services
have been denied, modified, or delayed by the plan, or by
one of its contracting providers, if the decision was
based in whole or in part on a finding that the proposed
health care services are not medically necessary.
This bill:
1)Requires, to the extent permitted by federal law, if any drug
used in the treatment of seizures and epilepsy is prescribed
by a Medi-Cal beneficiary's treating provider for the
treatment of seizures and epilepsy, and coverage for that
prescribed drug is denied by a Medi-Cal managed care plan in
which the beneficiary is enrolled, that denial to be reviewed
in accordance with the requirements of this bill.
2)Makes the denial by a Medi-Cal managed care plan of a drug
prescribed for the treatment of seizures and epilepsy and
approved by the FDA for the use in the treatment of seizures
and epilepsy subject to an urgent appeal process established
by this bill, if:
a) The treating provider demonstrates, consistent with
federal law, that in his or her reasonable, professional
judgment, the drug is medically necessary and consistent
with the FDA's labeling and use rules and regulations, as
supported in at least one of the official compendia
identified in federal Medicaid law; and,
b) The drug is not on the formulary for the Medi-Cal
managed care plan.
3)Requires a Medi-Cal beneficiary to be entitled to an urgent
appeal in a case in which a plan denies coverage for a drug
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prescribed for the treatment of seizures and epilepsy and
approved by the federal FDA for the use in the treatment of
seizures and epilepsy. Requires an urgent appeal to be
resolved by the plan within 24 hours after the plan receives
the request. Requires the 24-hour period to be in addition to
any time prescribed by federal law.
4)Defines an "urgent appeal" as an appeal in which the
beneficiary, or treatment provider with the consent of the
beneficiary, requests an urgent appeal either orally or in
writing.
5)States legislative intent that a Medi-Cal beneficiary have
prompt access to medically necessary drugs for use in the
treatment of seizures and epilepsy that have been approved by
the FDA for use in the treatment of seizures or epilepsy,
including drugs that are not on the formulary of a Medi-Cal
managed care plan or that are subject to prior authorization.
Comments
1)Author's statement. According to the author, epilepsy is
life-threatening and the first treatment is typically the best
chance to get the disease under control. Formularies and
step-therapy programs are not always sufficient to treat
certain vulnerable populations. New pharmaceuticals and
treatments are emerging rapidly, while insurance formularies
do not have the capacity to keep up. In the meantime, patient
care is being affected and individuals are losing access to
receive the best pharmaceuticals that may control their
condition sooner rather than later. Current formulary
restrictions have multiple appeals processes patients have to
go through. Step therapy correspondingly delays the patient
from obtaining the most suitable drug combinations for their
case.
2)Background on epilepsy. According to the Centers for Disease
Control and Prevention, epilepsy is a disorder of the brain
that causes seizures. These seizures are not caused by a
temporary underlying medical condition such as a high fever.
Epilepsy can affect people in very different ways as there are
many causes and many different kinds of seizures. Some people
may have multiple types of seizures or other medical
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conditions in addition to epilepsy. These factors play a major
role in determining both the severity of the person's
condition and the impact it has on his or her life. The way a
seizure looks depends on the type of seizure a person is
experiencing. Some seizures can look like staring spells.
Other seizures can cause a person to collapse, shake, and
become unaware of what is going on around them. Epilepsy can
be caused by different conditions that affect a person's
brain. For two in three people, the cause of epilepsy is
unknown. Some causes include stroke, brain tumor, traumatic
brain injury or head injury or central nervous infection. A
person with epilepsy is not contagious and cannot give
epilepsy to another person. According to the latest estimates,
about 1.8% of adults aged 18 years or older have had a
diagnosis of epilepsy or seizure disorder.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee:
1)Likely one-time costs of up to $150,000 to make administrative
changes by DHCS (General Fund and federal funds). DHCS
indicates that it would need to update existing regulations,
managed care plan contracts, Notice of Action forms, and
appeals reporting templates.
2)Likely minor costs to monitor Medi-Cal managed care plan
compliance with this bill's requirements by DHCS.
3)Unknown impact on the cost to provide prescription drugs by
Medi-Cal managed care plans (General Fund and federal funds).
Managed care plans create drug formularies as a way to control
costs, by selecting low cost drugs and by increasing their
bargaining power with drug companies. By creating a new
appeals process to provide increased access to drugs that are
not on Medi-Cal manage care plans' drug formularies, this bill
may increase patient access to more expensive drugs and/or
reduce the managed care plans' ability to negotiate discounts
and rebates with drug manufacturers. The extent to which this
will increase spending on prescription drugs is unknown.
SUPPORT: (Verified8/28/15)
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American Federation of State, County and Municipal Employees,
AFL-CIO
Association of Regional Center Agencies
Biocom
California Chronic Care Coalition
California Healthcare Institute
California Life Sciences Association
Child Neurology Foundation
Disability Rights California
Epilepsy California
Sunovion Pharmaceuticals
OPPOSITION: (Verified8/28/15)
California Association of Health Plans
ARGUMENTS IN SUPPORT: Epilepsy California writes in support
that for the majority of people living with epilepsy,
anti-epilepsy medications (anticonvulsants) are the most common
and most cost effective treatment for controlling and/or
reducing seizures. But there is no "one-size fits all" treatment
option for epilepsy, and the response to epilepsy medications
can be different for each person. Physicians must be able to use
their reasonable, professional judgment to prescribe
FDA-approved medications that are best for each patient, and
patients must gain timely access to these medications without
enduring a lengthy appeal process. Epilepsy California writes
that timely access to the most appropriate medications to
control their seizures will go a long way to reduce Medi-Cal
patients' admissions for emergency room intervention.
Sunovion Pharmaceuticals writes in support that this bill will
help ensure patient access to medically necessary treatment and
care for seizures and epilepsy and establishes a clear policy
that will translate across all managed care plans and help
ensure that Medi-Cal patients have equal access to drugs best
suited to treat this serious condition. Sunovion writes that
without access to medically necessary medications, patients are
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subjected to uncoordinated and inappropriate treatment patterns
often leading to non-adherence and ultimately hospitalization.
Sunovion states that numerous studies have found that limiting
access to treatment options for epilepsy does not reduce overall
health care costs. Studies have shown that the primary driver of
direct costs associated with epilepsy treatment are attributed
to medical costs rather than anti-epileptic drug costs. Sunovion
writes that maintaining seizure control requires careful
evaluation and monitoring by the physician and patient, and
physicians treating epilepsy must be able to prescribe drugs
that are best for each patient, based on independent clinical
judgment, and this bill establishes a policy where a
prescriber's reasonable professional judgment has the
opportunity to prevail when prescribing a product for such a
serious condition. This bill will help ensure patients in the
Medi-Cal program will be able to promptly access the most
effective treatment - generic or branded - for epilepsy and
seizures, by ensuring that patient needs prevail over "one size
fits all" approaches to medication management.
ARGUMENTS IN OPPOSITION: The California Association of
Health Plans (CAHP) writes it is opposed unless amended to this
bill. CAHP argues this bill allows for an enrollee to request an
expedited appeal process; however, no additional information
regarding the enrollee is required to be submitted by the
physician. In order to appropriately and effectively re-evaluate
the use of the non-formulary drug, health plans require
additional supporting documentation from the physician. CAHP
states the absence of additional supporting documentation during
the expedited review deflates the integrity of the expedited
review process because pharmacy managers will not have any new
and relevant supporting documentation. CAHP concludes that, in
order for health plans to vigorously review non-formulary
requests, additional information must be required from
physicians.
ASSEMBLY FLOOR: 78-0, 6/3/15
AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,
Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang,
Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle,
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Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina
Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,
Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden,
Irwin, Jones, Kim, Lackey, Levine, Linder, Lopez, Low,
Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin,
Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea,
Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago,
Steinorth, Mark Stone, Ting, Wagner, Waldron, Weber, Wilk,
Williams, Wood, Atkins
NO VOTE RECORDED: Jones-Sawyer, Thurmond
Prepared by:Scott Bain / HEALTH /
8/31/15 8:33:21
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