BILL ANALYSIS Ó AB 1763 Page 1 Date of Hearing: May 4, 2016 ASSEMBLY COMMITTEE ON APPROPRIATIONS Lorena Gonzalez, Chair AB 1763 (Gipson) - As Introduced February 3, 2016 ----------------------------------------------------------------- |Policy |Health |Vote:|14 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: YesReimbursable: No SUMMARY: This bill requires health plans and insurers to cover, without cost-sharing, certain colorectal cancer screening procedures, under specified conditions. Specifically, this bill: 1)Mirrors federal requirements requiring coverage without cost-sharing for colorectal cancer screening and laboratory AB 1763 Page 2 exams assigned either a grade of A or B by the United States Preventive Services Task Force (USPSTF) for persons of average risk. 2)Requires coverage for additional colorectal cancer screening examinations and laboratory tests as recommended by a health care provider, if a person is at high risk of colorectal cancer as determined by a health care provider. 3)Specifies for an enrollee 50 years of age or older that colonoscopy, including the removal of polyps, is covered without cost-sharing when the colonoscopy is either: (1) a screening procedure not occasioned by a recent positive test or procedure, or (2) scheduled because of a positive result on a test or a procedure, other than colonoscopy, that has been assigned either a grade of A or B by the USPSTF. FISCAL EFFECT: 1)According to the California Health Benefits Review Program (CHBRP): a) No costs to Medi-Cal (GF/federal) and $1.3 million to CalPERS for increased premiums. b) Increased employer-funded premium costs in the private insurance market of approximately $17.3 million. c) Increased premium expenditures by employees and individuals purchasing insurance of $26.5 million, and decreased out-of-pocket expenses of $35.4 million. AB 1763 Page 3 2)Minor costs to the California Department of Insurance (Insurance Fund) and the Department of Managed Health Care (Managed Care Fund) to verify plans and insurers comply with this requirement. COMMENTS: 1)Purpose. According to the author, this bill will remove cost barriers to colonoscopies for adults over 50 years of age, helping to catch cases of colorectal cancer earlier and improving survival. 2)Background. Colon cancer is cancer of the large intestine (colon), the lower part of the digestive system. Rectal cancer is cancer of the last several inches of the colon. Together, they're often referred to as colorectal cancer. Most cases begin as small, noncancerous clumps of cells called adenomatous polyps, which may produce few, if any, symptoms. Over time some of these polyps become cancerous. For this reason, doctors recommend regular screening tests to help prevent colorectal cancer by identifying and removing polyps before they become cancerous. 3)Current requirements. The federal Affordable Care Act requires coverage of certain preventive services that meet evidentiary standards without cost-sharing. Specifically, services given an "A" or "B" grade by the USPSTF, a federally designated body that reviews clinical evidence, are covered with no cost-sharing. The USPSTF recommends screening for colorectal AB 1763 Page 4 cancer using fecal occult blood testing, sigmoidoscopy, or colonoscopy in adults, beginning at age 50 years and continuing until age 75 years. This is given an "A" grade for this age group, meaning the USPSTF recommends the service and there is high certainty that the net benefit is substantial. They note the risks and benefits of these screening methods vary. The most recent recommendations were published in 2008, and they are in the final stages of being updated this year. There is no "A" or "B" grade recommendation for screening in individuals older than 75, neither in the current recommendation nor the new draft recommendation. Colonoscopy, sigmoidoscopy, and blood tests are recommended screening modalities. A colonoscopy is recommended every 10 years beginning at age 50. It is the most comprehensive test and removes any offending polyps during the test. Fecal occult blood testing, another recommended screening modality, is performed annually. Blood testing may lead to greater compliance with recommended screening than colonoscopy, which is more invasive. A positive blood test can, however, provide an indication for a follow-up colonoscopy. This bill is intended to address a situation where a follow-up colonoscopy is considered "diagnostic" and subject to a patient share of cost, versus a preventive screening which is covered with no share of cost. A colonoscopy following a positive blood test is recommended. However, the blood test is considered a highly sensitive test for colon cancer, meaning the follow-up colonoscopy may be considered a diagnostic test and therefore could, depending on the specifications of coverage and how a provider bills for it, be subject to cost-sharing. This bill also allows providers wide discretion to recommend other tests for individuals at high risk, and requires the tests be covered with no cost-sharing. 4)CHBRP findings. CHBRP assumed an additional 2,500 screenings AB 1763 Page 5 would occur as a result of this bill's requirements, but CHBRP projects no measurable public health impact at the population level due to the small number of additional enrollees who would avail themselves of screening. CHBRP states it is reasonable to assume that this reduction in financial burden would promote greater adherence to physician-recommended screenings on a long-term basis among this small set of people impacted. 5)Essential Health Benefits (EHBs). Federal law requires the state to defray additional costs caused by any state mandates that exceed a set of federally defined EHBs. CHBRP states his bill impacts the terms and conditions of coverage for screenings and tests, but does not change coverage itself and thus does not exceed EHBs. Plans and insurers question this finding, as noted in their opposition, below. 6)Support. This bill is sponsored by the American Cancer Society Cancer Acton Network and the California Colorectal Cancer Coalition, and it is supported by a number of other groups. Supporters indicate this bill will increase screening and survival as well as reduce racial, ethnic, and socioeconomic disparities by removing financial barriers to screening. 7)Opposition. Health plans and insurers oppose this bill, citing increased costs and the potential to exceed EHBs. Blue Shield of California (BSC) argues that new USPSTF screening recommendations expected later in 2016 are likely to be different than current ones, making this bill premature. BSC is also concerned with this bill's requirement to cover, at no share of cost, a broad array of additional screenings and tests recommended by a physician if a person is considered "high risk." 8)Staff Comments. This bill shifts costs of recommended AB 1763 Page 6 screening tests fully to insurance coverage, reducing out-of-pocket expenses for colonoscopy and, for high-risk individuals, other tests as recommended. There is some survival benefit of an additional number of people getting tests because of the reduction in share of costs. For follow-up colonoscopies, this is generally beneficial and recommended testing and would likely benefit people who have higher cost-sharing and who would be more likely to skip the test if they had to pay out of pocket for it. Less is known about a net benefit of the additional screening tests for high-risk individuals, since that provision is broad, subject to interpretation by the provider, and not based on a finding from a nationally recognized entity. Health plans also believe this could exceed EHBs, resulting in a state fiscal impact to defray costs. It is unclear whether this bill exceeds EHBs, as it is unclear which cancer screening tests for people of high risk for cancer would be denied coverage under current law. Analysis Prepared by:Lisa Murawski / APPR. / (916) 319-2081