BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 859


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          Date of Hearing:  April 28, 2015


                            ASSEMBLY COMMITTEE ON HEALTH


                                  Rob Bonta, Chair


          AB 859  
          (Medina) - As Amended March 26, 2015


          SUBJECT:  Medi-Cal:  obesity treatment plans.


          SUMMARY:  Requires the Department of Health Care Services (DHCS)  
          to create an Obesity Treatment Action Plan (OTAP) to diagnose,  
          treat, and reduce the incidence of adult obesity in the Medi-Cal  
          program, and report the plan and recommendations to the  
          Legislature, as specified.  Specifically, this bill:  



          1)Requires DHCS to create an OTAP by December 31, 2016, that  
            applies to only noncapitated Medi-Cal payment plans.

          2)Requires the OTAP to include evidence-based principles based  
            on guidelines provided by recognized provider associations, as  
            specified.



          3)Requires the OTAP to include all of the following:



             a)   A plan for educating fee-for-service physicians  
               regarding the importance of screening for obesity and  








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               treatment options available in Medi-Cal;

             b)   A plan for identifying and screening patients for  
               obesity; and,



             c)   A review of current coverage of services to treat  
               obesity and recommendations with evidence-based rationale  
               on the continuum of coverage of additional obesity  
               treatment services, including nutritional, exercise, and  
               lifestyle counseling and pharmacotherapy.



          4)Requires a report to be submitted to the Legislature and for  
            the section to be repealed by January 1, 2021.

          EXISTING LAW:  



          1)Requires the Department of Public Health (DPH) to investigate  
            and apply for federal funding opportunities regarding the  
            promotion of healthy eating and preventing obesity, and  
            authorizes DPH, upon receipt of federal funds, to provide  
            in-kind support and award grants to local governments,  
            nonprofit organizations, and local education agencies as  
            deemed appropriate.

          2)Establishes the Medi-Cal program under the direction of DHCS,  
            as California's Medicaid program, to provide qualifying  
            low-income individuals with health care and a uniform schedule  
            of benefits.



          3)Establishes the Urban Community Health Institute:  Centers to  
            Eliminate Health Disparities at the Charles R. Drew University  








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            of Medicine and Science to address the problem of disparate  
            health care in the Los Angeles County Planning Area and other  
            multicultural communities that have the worst health care  
            status indicators, medical outcomes, and death rates in Los  
            Angeles County.  Establishes the Obesity and Nutrition Center  
            as one of the three centers at the Institute.



          FISCAL EFFECT:  This bill has not yet been analyzed by a fiscal  
          committee.


          COMMENTS:  


          1)PURPOSE OF THIS BILL.  The author points to DHCS studies that  
            have shown the proportion of adults with obesity is highest  
            among adults enrolled in Medi-Cal, with rates higher than  
            individuals in the privately insured market and the uninsured  
            population.  The author contends that California is behind  
            other states with regard to obesity treatment; while the  
            majority of other states cover nutritional consultation under  
            Medicaid, California explicitly excludes this type of  
            coverage.  The author asserts that California could receive  
            significant cost savings on healthcare and improve the health  
            of patients by investing on obesity treatments.  The author  
            concludes this bill will provide a plan to diminish obesity as  
            an epidemic in California and will improve state health and  
            ensure long-term savings of taxpayer dollars.

          2)BACKGROUND.  



             a)   Impacts of obesity on health.  Obesity is a chronic  
               disease that can have serious negative effects on the  
               internal systems of the body.  There are a variety of  
               factors that play a role in obesity, which makes it a  








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               complex health issue to address.  Behavior, environment,  
               and genetic factors all have an effect on causing people to  
               be overweight and obese.  People who are obese have an  
               increased risk of developing serious medical conditions,  
               including heart disease, type 2 diabetes, and bone or joint  
               disease.  The U.S. Surgeon General has declared that  
               obesity has reached epidemic levels within the U.S., with  
               approximately 35% of women and 31% of men considered  
               seriously overweight.  

             b)   Obesity in California.  California now has the fifth  
               lowest adult obesity rate in the nation, according to The  
               State of Obesity: Better Policies for a Healthier America.   
               However, the state's adult obesity rate has increased up to  
               24.1%, up from 9.9% in 1990.  In 2007, 33.6% of children  
               ages two to five were overweight or obese.  



             c)   Previous Efforts to Fight Obesity in California.   
               Previous initiatives have been established in California to  
               prevent obesity.  In 2000, the Center for Weight and Health  
               collaborated with DPH's predecessor to establish the  
               California Obesity Prevention Initiative (COPI).  The COPI  
               program was part of a national effort from the federal  
               Centers for Disease Control and Prevention (CDC) to prevent  
               obesity among children in California.  Part of the program  
               involved pilot testing an innovative strategy to reduce  
               television viewing among children in select communities  
               that could subsequently be implemented on a larger scale.   
               Funding for COPI lasted for only five years.


             
               DPH has launched more recent initiatives.  The 2005-06  
               Budget mandated DPH create a strategic plan to coordinate  
               existing resources and to guide a statewide response to the  
               obesity crisis.  In 2006, DPH published its first Obesity  
               Prevention Plan (OPP) in response to the legislative  








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               mandate.  Since its publication, DPH reports there has been  
               significant progress in the implementation of policies  
               supporting obesity prevention.



               In 2010, DPH updated the OPP to focus on the importance of  
               implementing policy and environmental change strategies, as  
               well as addressing health inequities and disparities.  The  
               2010 OPP Plan is a broader array of obesity prevention  
               strategies, as well as highlights of successful actions  
               currently being implemented across the state.


               
          3)SUPPORT.  The Obesity Action Coalition, the sponsor of the  
            bill, states that Medi-Cal fee-for-service patients who are  
            affected by obesity should have access to the same medically  
            necessary and covered treatment avenues afforded to others who  
            receive care through managed care, or public or private health  
            plans.  The sponsor asserts it is critical for DHCS to address  
            the disease of obesity and provide evidence-based treatments  
            to those who lack the economic means or resources to gain  
            access themselves.  The sponsor concludes this bill will  
            provide for a thorough review of current coverage policies  
            surrounding evidence-based obesity treatment avenues and  
            highlight gaps in treatment avenues that should be addressed.

            Supporters of this bill assert that those affected by obesity  
            should follow the same continuum of coordinated care as those  
            with suffering from other chronic diseases, such as heart  
            disease.  Supporters state the complex nature of obesity and  
            its variety of impacts on both physical and mental health  
            requires coordinated services of providers from several  
            disciplines and professions in order to provide effective  
            treatment.  The supporters contend this bill will provide  
            valuable information as to the latest treatments and costs  
            associated with obesity, and will help the state mitigate its  
            impact as one of the biggest drivers of preventable chronic  








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            disease and healthcare costs in the U.S.



          4)RELATED LEGISLATION.  
          
             a)   AB 572 (Gaines) requires DPH to create a diabetes action  
               plan for the state, and to report the results of the plan  
               to the Legislature biennially.  AB 572 was heard in the  
               Assembly Health Committee on April 14, 2015 and passed out  
               with a vote of 17-0.  AB 572 is pending in the Assembly  
               Appropriations Committee.

             b)   AB 1357 (Bloom) establishes the Children and Family  
               Health Promotion Program in DPH and requires the program to  
               consist of a competitive grant process in which grants are  
               awarded by the department to counties, cities, nonprofit  
               organizations, community-based organizations, and licensed  
               clinics that seek to invest in childhood obesity and  
               diabetes prevention activities and oral health programs.   
               AB 1357 is pending in the Assembly Health Committee.



             c)   SB 203 (Monning) requires a safety warning to be affixed  
               to sugar sweetened beverages that states "STATE OF  
               CALIFORIA SAFETY WARNING: Drinking beverages with added  
               sugar(s) contributes to obesity, diabetes, and tooth  
               decay."  SB 203 is pending in the Senate Health Committee. 



             d)   SCR 34 (Monning) proclaims the month of September 2015,  
               and each year thereafter, as Childhood Obesity Awareness  
               Month, and would express the Legislature's support of  
               various programs that work to reduce obesity among  
               children.  SCR 34 was recently heard on the Senate Floor  
               and passed with a vote of 29-4.  SCR 34 is pending at the  
               Assembly Desk.








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          5)PREVIOUS LEGISLATION.  
          
             a)   AB 1592 (Beth Gaines) of 2014 would have required DPH to  
               complete and submit to the Legislature a Diabetes Burden  
               Report by December 31, 2015.  AB 1592 was vetoed by  
               Governor Brown, stating that DPH had already submitted its  
               Diabetes Burden Report to the CDC, as required, and is  
               unable to withdraw the report to include additional  
               information prescribed by AB 1592. 

             b)   SB 1000 (Monning) of 2014 would have established the  
               Sugar-Sweetened Beverages Safety Warning Act, to be  
               administered by DPH and required a safety warning on sugar  
               sweetened beverages.  SB 1000 failed passage in the  
               Assembly Health Committee.



             c)   AB 200 (Hayashi) of 2011 would have required the State  
               Board of Education, to establish the Health and Fitness  
               Award Program to provide an award to one school in each  
               legislative district that conducts their physical education  
               courses pursuant to the model content standards and  
               demonstrates that increasing numbers of pupils meet minimum  
               standards on the physical performance test.  AB 200 was  
               vetoed by the Governor Brown, who stated that although  
               health and fitness are important, schools should be allowed  
               to design their own awards programs.



          6)POLICY COMMENTS.  
          
             a)   The author states part of the purpose of this bill is to  
               have the state realize cost savings to healthcare, in part  
               due to a preventive treatment plan for obesity.  As  








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               currently written, this bill does not provide a funding  
               source for this plan.  Existing law requires DPH to  
               investigate and request federal financial assistance to  
               help create programs to reduce obesity.  The author may  
               wish to consider future amendments that would require DHCS  
               to investigate and request similar funding specifically for  
               the Medi-Cal population, as there is no existing funding  
               source for this bill.

             b)   The author indicates the intent of the bill is to apply  
               the OTAP to only Medi-Cal fee-for-service patients, rather  
               than being inclusive of both the Medi-Cal fee-for-service  
               and managed care population.  Fee-for-service beneficiaries  
               account for approximately 25% of the estimated total of 12  
               million beneficiaries within the Medi-Cal program.  The  
               remaining 75% are Medi-Cal managed care beneficiaries.   
               Although the managed care system is designed to include  
               care for obesity diagnoses and treatments, the obesity  
               rates of the overall Medi-Cal population is still high.   
               The author may wish to consider including Medi-Cal managed  
               care beneficiaries within the requirements of the bill.



          7)TECHNICAL AMENDMENTS.
          
             a)   This bill requires DHCS to create an OTAP to diagnose,  
               treat, and reduce the incidence of adult obesity in the  
               Medi-Cal program; however it is unclear whether or not the  
               establishment of this program is allowable under federal  
               law.  The Committee may suggest amending this bill to  
               authorize DHCS to apply for a waiver or any necessary  
               federal approvals from the Centers for Medicare and  
               Medicaid Services, if the OTAP is in fact not, and help  
               address the funding issue by insuring the program is  
               eligible for federal financial participation.

             b)   This bill requires the provisions to apply only to  
               noncapitated payment plans in Medi-Cal.  The author  








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               indicates the intent of the bill is to apply only to  
               Medi-Cal fee-for-service, however the current language of  
               the bill does not explicitly indicate the program should be  
               applied to only this population and the wording could be  
               somewhat confusing.  The Committee may suggest amending  
               this bill to clarify that the provisions only apply to the  
               Medi-Cal fee-for-service population.  



          REGISTERED SUPPORT / OPPOSITION:




          Support


          Obesity Action Coalition (sponsor)


          American Society for Metabolic and Bariatric Surgery -  
          California State Chapter


          Biocom
          Biotechnology Industry Organization


          California Communities United Institute


          California Healthcare Institute


          Obesity Care Continuum











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          Opposition


          None on file.




          Analysis Prepared by:An-Chi Tsou / HEALTH / (916) 319-2097