BILL ANALYSIS                                                                                                                                                                                                    Ó





          SENATE COMMITTEE ON HEALTH
                          Senator Ed Hernandez, O.D., Chair

          BILL NO:                    AB 1739             
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          |AUTHOR:        |Waldron                                        |
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          |VERSION:       |June 2, 2016                                   |
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          |HEARING DATE:  |June 29, 2016  |               |               |
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          |CONSULTANT:    |Scott Bain                                     |
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           SUBJECT :  Medi-Cal:  allergy testing

           SUMMARY  :  Requires the Department of Health Care Services, for  
          individuals with a medical history of specified allergies, to  
          treat serologic-specific IgE tests (a type of blood test) and  
          skin tests as equivalent confirmatory tests in their clinical  
          efficacy, and to provide the same standard of coverage for  
          either test.
          
          Existing law:
          1)Establishes the Medi-Cal program, which is administered by the  
            Department of Health Care Services (DHCS), under which  
            qualified low-income individuals receive health care services.

          2)Establishes a schedule of benefits under the Medi-Cal program,  
            and authorizes the use of utilization controls, including  
            prior authorization, that may be applied to those covered  
            benefits and that are reviewed for, among other things,  
            medical necessity. Physician services are a covered benefit,  
            subject to utilization controls.

          3)Requires, pursuant to Medi-Cal regulation, outpatient  
            physician services to be covered if they are medically  
            necessary to protect life, to prevent significant illness or  
            significant disability, or to alleviate severe pain, subject  
            to limitations.

          This bill:
          1)Requires DHCS to treat serologic-specific IgE tests and  
            percutaneous skin tests as equivalent confirmatory tests in  
            their clinical efficacy, and to provide the same standard of  
            coverage for either test for those individuals with a medical  
            history consistent with any of the following:





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                a)      An inhalant allergy;
                b)      A food allergy;
                c)      Hymenoptera venom allergy or an allergy to  
                  stinging insects;
                d)      Allergic bronchopulmonary aspergillosis (ABPA); 
                e)      Certain parasitic diseases; or,
                f)      Allergies to specific drugs.

          1)Requires DHCS to update its provider bulletins, as necessary,  
            to reference the most current professional literature and  
            guidance related to allergy testing.

           FISCAL  
          EFFECT  :  According to the Assembly Appropriations Committee,  
          uncertain, likely minor overall fiscal effect in the FFS  
          Medi-Cal program (GF/federal). Blood testing utilization could  
          go up, while utilization of skin tests could go down. The net  
          effect is unknown.

           PRIOR  
          VOTES  :  
          
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          |Assembly Floor:                     |79 - 0                      |
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          |Assembly Appropriations Committee:  |19 - 0                      |
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          |Assembly Health Committee:          |18 - 0                      |
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          COMMENTS  :
          1)Author's statement.  According to the author, historically,  
            allergies were diagnosed by an allergy specialist who used a  
            "skin-prick" test to infect the skin of a patient and waited  
            to see what the patient reacted to. This requires a patient to  
            be referred to an allergist by their primary care doctor and  
            requires the patient to undergo a series of pricks to their  
            skin. But now blood tests are equally effective in diagnosing  
            allergies and can be ordered directly by a primary care  
            physician without referring the patient to a specialist.  
            Medi-Cal's provider manual explicitly favors skin testing over  
            blood testing by requiring a primary doctor to identify a  
            "Contraindication" to skin testing before ordering a blood  
            test. This is contrary to National Guidelines. Combined with  
            too few allergy specialists, this creates an access to care  
            problem for Medical patients who need an efficient diagnosis  





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            and treatment of allergies. This bill would correct this  
            inequity by requiring DHCS to treat blood allergy tests and  
            skin allergy tests as equivalent in their sensitivity and  
            accuracy for confirming allergies. This bill would also  
            require DHCS to update its provider bulletins to reference the  
            most current professional literature and guidance related to  
            allergy testing.
          
          2)Medi-Cal Manual of Criteria. Under existing law, DHCS is  
            authorized to use utilization controls for covered Medi-Cal  
            benefits. The DHCS Manual of Criteria sets for the procedures  
            and codes for providers to use to bill allergy testing and  
            desensitization. It contains the procedure codes and  
            instructions for billing, and the medical reference for the  
            coverage criteria. The Manual of Criteria for allergy testing  
            and desensitization was changed by DHCS in March 2009, June  
            2012, April 2013, December 2014, and June 2015. 

            Medi-Cal coverage policy of allergy testing was the subject of  
            an August 12, 2014 Assembly Health Committee informational  
            hearing entitled "Medi-Cal: When Reimbursement Policies  
            Interfere with the Standard of Care." Subsequent to the  
            hearing, on May 15, 2015, Medi-Cal removed the requirement  
            that laboratories submit documentation of medical necessity  
            with claims for IgE testing reimbursement. However,  
            limitations on Medi-Cal coverage for IgE did not apply to skin  
            testing remain. For example, current coverage for the allergen  
            specific IgE test must include documentation in the patient's  
            medical record, with one of the following numbered criteria:

                  a)        The patient has persistent asthma and the test  
                    is needed to determine the potential sensitivity to  
                    perennial indoor allergens to which the patient is  
                    exposed; 
                  b)        At least one of the following conditions is  
                    documented in the patient's medical record: 
                         i.               Widespread skin disease
                         ii.              Patients receiving medications  
                           that may confound the results of skin      
                           testing or interfere with the detection or  
                           management of anaphylaxis;  
                         iii.             Uncooperative patients;  
                         iv.              When the history suggests  
                           significant risk of anaphylaxis from skin  
                           testing; or,  
                         v.               Patients undergoing work-up for  
                           major allergic reaction, including possible  
                           anaphylaxis or severe urticarial.





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          1)Medical literature on blood and skin tests for allergies. In a  
            February 2010 article in the Journal of Allergy and Clinical  
            Immunology from Johns Hopkins School of Medicine entitled  
            Clinical Laboratory Assessment of Immediate-type  
            Hypersensitivity it is stated that: "For food and respiratory  
            allergy, IgE antibody as detected in the serum by using  
            current autoanalyzer technology and in the skin by using the  
            epicutaneous test are considered equivalent as confirmatory  
            tests in terms of their sensitivity and accuracy 

          2)Support. Thermo Fisher Scientific, the sponsor of this bill,  
            argues that Medi-Cal's coverage policy for allergy testing is  
            inconsistent with national guidelines, best practices, and the  
            most recent scientific literature. Food allergy guidelines of  
            the NIAID and the asthma guidelines of the National Heart,  
            Lung, and Blood Institute's recognize that blood tests and  
            skin tests are equivalent in their efficacy for diagnosing  
            allergic sensitizations. 

            A physician from Miller Children's Hospital in Long Beach  
            states that updating testing guidelines will have a major  
            positive impact on Medi-Cal patients suffering from allergies.  
            The physician writes that, in a perfect world, every patient  
            suffering from an allergic disease would receive their care  
            from a specialist. Unfortunately, allergy specialists are a  
            very scarce resource, especially for the Medi-Cal population,  
            with unacceptably long wait times. It is not realistic for  
            DHCS, or any payer, to rely solely on the efforts of  
            specialists to be able to skin test every Medi-Cal patient  
            that requires an allergy test. 

            The CaliforniaHealth+ Advocates (CH+A) writes in support that  
            this bill will improve patient care, eliminate unnecessary  
            restrictions on primary care physicians' ability to utilize  
            blood tests as a diagnostic tool for determining sensitivity  
            to allergens in Medi-Cal patients, save money by ensuring  
            timely diagnosis of allergies in Medi-Cal patients, and  
            eliminate unnecessary referrals to an allergist for skin  
            testing. In doing so, CH+A writes this bill eliminate  
            unnecessary barriers to care and create greater equity across  
            our health system.

          3)Opposition. DHCS writes in opposition that this bill will  
            change current Medi-Cal policy and contradicts the  
            recommendation of the American Academy of Allergy, Asthma, and  
            Immunology (AAAAI) and the American College of Allergy, Asthma  
            and Immunology (ACAAI). DHCS states Medi-Cal's allergy testing  





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            policy is based upon the AAAAI and ACAAI clinical practice  
            guidelines that recommend the skin prick test as the preferred  
            procedure to test for allergies, and Medi-Cal allows for IgE  
            test when the patient's medical condition requires another  
            mode of testing other than skin prick. DHCS writes this bill  
            do not reflect current practice guidelines from the leading  
            medical associations for allergy testing, and DHCS writes that  
            AAAAI is working on a new primer/guideline for allergy testing  
            that it expects to publish later this year. DHCS concludes by  
            noting that current Medi-Cal policy for ordering IgE tests  
            does not pose a barrier to access for fee-for-service  
            beneficiaries as DHCS data shows that more beneficiaries are  
            receiving IgE tests than skin prick tests, and when DHCS  
            removed manual review for IgE tests as skin prick tests,  
            nearly six times as many beneficiaries received the IgE test  
            as skin prick tests.

          4)Policy issues. 

               a)     Statutory declaration of equivalent confirmatory  
                 tests. This bill, as written, would statutorily require  
                 DHCS to declare serologic-specific IgE tests and  
                 percutaneous skin tests as equivalent confirmatory tests  
                 in their clinical efficacy, and would require DHCS to  
                 provide the same standard of coverage. The impetus for  
                 this bill is current Medi-Cal coverage for the  
                 serologic-specific IgE tests is subject to additional  
                 criteria that existing skin allergy tests are not.  
                 Proponents cite medical literature as to why current  
                 Medi-Cal coverage is out-of-date and not consistent with  
                 other payors and current medical literature. 

                 However, statutorily declaring two types tests as  
                 equivalent in clinical efficacy has the disadvantage of  
                 codifying a coverage standard that, even if accurate now,  
                 may not be accurate in the future if allergy testing  
                 improves. Codifying such a standard in existing law would  
                 require subsequent statutory changes if medical evidence  
                 and practice guidelines change. In addition, statutorily  
                 requiring the same standard of coverage may limit DHCS  
                 and Medi-Cal managed care plans' ability to negotiate  
                 lower prices if the tests are of equal efficacy but the  
                 cost of a particular test is significantly higher than  
                 the other. Finally, the Legislature is generally not well  
                 equipped to evaluate the clinical efficacy of competing  
                 medical tests and procedures, as compared to  
                 peer-reviewed literature published in scientific or  
                 medical journals, national expert panels, or consensus  





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                 practice guidelines.

               b)     Coverage based on medical history. The coverage in  
                 this bill is for individuals with a medical history  
                 consistent with various allergies, including a food  
                 allergy, an allergy to venom or stinging insects, drug  
                 allergies or an inhalant allergy. However, allergy  
                 testing is typically used to strengthen a diagnosis of  
                 patients who present with allergy symptoms following a  
                 clinical history and physical examination. These  
                 individuals may or may not have a medical history  
                 consistent with allergies. In lieu of coverage based on  
                 medical history, the coverage in this bill could be based  
                 on "symptoms compatible with an allergic disorder" or  
                 words to that effect. 

                 To address the issues in a) and b), alternative language  
                 to the language in this bill is as follows:

                 14133.75(a)  The department shall treat serologic-specific  
                 IgE tests and percutaneous skin tests as equivalent  
                 confirmatory tests in their clinical efficacy, and shall  
                 provide the same standard of coverage for either test for  
                 those individuals with a medical history consistent with  
                 any of the following:   The department shall provide the  
                 same standard of coverage for serologic-specific IgE  
                 tests and percutaneous skin tests if peer-reviewed  
                 medical literature supports a determination that those  
                 tests are equivalent confirmatory tests in terms of their  
                 clinical efficacy. If that determination is made the  
                 department shall provide coverage for either test for a  
                 beneficiary who has symptoms consistent with any of the  
                 following:
                  (1) An inhalant allergy.
                 (2) A food allergy.
                 (3) Hymenoptera venom allergy or an allergy to stinging  
            insects.
                 (4) Allergic bronchopulmonary aspergillosis (ABPA). 
                 (5) Certain parasitic diseases.
                 (6) Allergies to specific drugs.
                 (7) The department shall update its provider bulletins,  
                 as necessary, to reference the most current professional  
                 literature and guidance related to allergy testing
           
          SUPPORT AND OPPOSITION  :
          Support:  Thermo-Fisher Scientific (sponsor)
                    American Federation of State, County and Municipal  
                    Employees, AFL-CIO





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                    California Life Sciences Association
                    One individual

          
          Oppose:   Department of Health Care Services 


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