BILL ANALYSIS Ó
AB 68
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GOVERNOR'S VETO
AB
68 (Waldron)
As Enrolled September 8, 2015
2/3 vote
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|ASSEMBLY: |78-0 |(June 3, 2015) |SENATE: |40-0 |(September 2, |
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|ASSEMBLY: |80-0 |(September 3, | | | |
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Original Committee Reference: HEALTH
SUMMARY: Establishes that a beneficiary has a right to an
urgent appeal process of a Medi-Cal managed care plan's denial
of a drug used in the treatment of seizures and epilepsy and is
a drug approved by the federal Food and Drug Administration for
the treatment of seizures and epilepsy.
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The Senate amendments clarify that an urgent appeal process must
be requested orally or in writing by a beneficiary or treatment
provider with the consent of the beneficiary.
EXISTING LAW:
1)Requires states, under the federal Medicaid law, to have a
drug use review program for covered outpatient prescription
drugs, to ensure drugs are appropriate, medically necessary,
and not likely to result in adverse medical effects. Federal
law requires the program to assess data on drug use against
predetermined standards, consistent with specified factors,
including compendia.
2)Provides a schedule of benefits provided in the Medi-Cal
program, including prescription drug benefits.
3)Authorizes the Department of Health Care Services (DHCS) to
establish utilization controls for any Medi-Cal services as
long as the controls are reasonably related to the purpose of
establishing them. Allows the utilization controls include
prior authorization, pre- and post-service audits, limitations
on the number of services and review pursuant to professional
standards.
FISCAL EFFECT: According to the Senate Appropriations
Committee, likely one-time costs of up to $150,000 to make
administrative changes by DHCS, likely minor costs to monitor
Medi-Cal managed care plan compliance with the bill's
requirements by DHCS, and an unknown impact on the cost to
provide prescription drugs by Medi-Cal managed care plans.
COMMENTS: The author argues this bill is a reasonable plan to
stabilize those with life-threatening conditions by ensuring a
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timely appeal if there is a denial by a managed care plan. The
author notes those who can afford private insurance plans have
doctors who may have more time to work through the existing
pre-authorization processes to attain a higher tier drug for
their patients, however, those in vulnerable low-income
situations are seeing their doctors most likely in clinics,
where doctors are short on time and do not have the resources to
follow-up on preauthorization appeals. The author concludes
this bill levels the playing field for access to medically
necessary drugs for low income patients with serious, chronic or
life threatening conditions by granting them the right to an
urgent appeal.
Medi-Cal is one of the largest drug purchasers in the state.
The program spends about $4 billion on prescription drugs,
including indirect expenditures through payment to managed care
plans and direct expenditures in fee for service and for
prescription drugs that are "carved out" of managed care.
Carved out means that the state pays directly for the drug
rather than indirectly through a capitated or fixed rate payment
to a Medi-Cal managed care plan.
Facing significantly rising costs, the federal and state
governments have grappled with various cost control measures.
California, to help manage costs, has established a formulary
for the fee-for service program. The formulary is not binding
on Medi-Cal managed care plans, each of which creates their own
formulary. A variety of utilization tools also are used. These
include limiting prescriptions to six per month, although many
beneficiaries receive more but only after a prior authorization
has been approved. Frequent and high cost prescription drug
users can be identified and case management interventions can be
used if appropriate to reduce drug costs.
Epilepsy is a chronic disorder, the hallmark of which is
recurrent, unprovoked seizures. Many people with epilepsy have
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more than one type of seizure and may have other symptoms of
neurological problems as well. Although the symptoms of a
seizure may affect any part of the body, the electrical events
that produce the symptoms occur in the brain. The location of
that event, how it spreads and how much of the brain is
affected, and how long it lasts all have profound effects.
These factors determine the character of a seizure and its
impact on the individual. Having seizures and epilepsy can
affect one's safety, relationships, work, driving and so much
more. How epilepsy is perceived or how people are treated can
become a bigger problem than the seizures.
Anti-epileptic drugs (AEDs) are the main form of treatment for
people with epilepsy. And up to 70% people with epilepsy could
have their seizures completely controlled with AEDs. There are
around 25 AEDs used to treat seizures, and different AEDs work
for different seizures.
Supporters note, on a prior version of the bill, that epilepsy
is a serious medical condition that produces seizures and one
seizure can have significant consequences, including head injury
limitations in driving or employment, hospitalization and sudden
unexpected death. They argue that failure to effectively manage
epilepsy and prevent breakthrough seizures results in higher
costs to the Medi-Cal program and society through increased
hospitalizations, relapses and deteriorating conditions which
necessitate additional and expensive care.
There is no known opposition to this bill.
GOVERNOR'S VETO MESSAGE:
This bill would grant a Medi-Cal beneficiary the right to an
urgent appeal when a Medi-Cal managed care plan denies coverage
for a drug prescribed for the treatment of epilepsy.
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The health plans are already required to have effective
up-to-date drug formularies and expedited appeal processes to
cover situations when health care services, including epilepsy
drugs, are denied. I believe establishing a separate urgent
appeal for this specific medical condition is unnecessary.
Analysis Prepared by:
Patty Rodgers / HEALTH / (916) 319-2097 FN:
0002489