BILL ANALYSIS Ó
AB 1831
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Date of Hearing: April 19, 2016
ASSEMBLY COMMITTEE ON HEALTH
Jim Wood, Chair
AB 1831
(Low) - As Introduced February 9, 2016
SUBJECT: Health care coverage: prescription drugs: refills.
SUMMARY: Requires health plans and insurers to allow early
refills of eye drops and ointments. Specifically, this bill:
1)Requires health care service plan contracts and health
insurance policies issued, amended, or renewed on or after
January 1, 2017, that provide coverage for prescription drug
benefits to allow for early refills of covered topical
ophthalmic products (TOPs) at 70% of the predicted days of
use.
2)States that nothing in this bill shall be construed to
establish a new mandated benefit or to prevent the application
of deductible or copayment provisions in a plan contract or
insurance policy.
EXISTING LAW:
1)Requires health care service plans to be regulated by the
Department of Managed Health Care (DMHC) and health insurers
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to be regulated by the California Department of Insurance
(CDI).
2)Requires health care plans and health insurers that cover
prescription drug benefits to provide notice in the evidence
of coverage and disclosure form to enrollees/insureds
regarding whether the plan uses a formulary.
3)Mandates the 10 federally required Essential Health Benefits
(EHBs) including prescription drug coverage and establishes
Kaiser Small Group health plan as California's EHB benchmark
plan for non-grandfathered individual and small group health
plan contracts and insurance policies.
FISCAL EFFECT: This bill has not yet been analyzed by a fiscal
committee.
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, poor
medication adherence is a major barrier to achieving better
patient outcomes. TOPS are used to treat a variety of
conditions including: uveitis, conjunctivitis, dry eye, and
glaucoma. Successful and effective treatment for these
eye-related conditions requires proper administration of the
medication. Eye drops can be difficult to self-administer; a
shaky hand can cause drops to hit the patient's cheeks or make
two eye drops come out at once. This unavoidable waste is one
reason that some patients run out of their eye drops too soon.
Interruptions in drug therapy for eye-related conditions
potentially have serious consequences, including irreversible
vision loss. Glaucoma patients are often elderly and have
difficulty dispensing the appropriate amount of eye drops,
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thereby requiring early refills of their medication.
When patients run out of eye drops before the scheduled refill,
they may have to pay the full cost of the prescription. But
when faced with the option of paying full price for the
prescription or waiting until the scheduled refill date, many
choose to go without the medication for a week or more instead
of paying out of pocket. A study on glaucoma treatment
adherence cited an inadequate amount of medication available
between scheduled prescription refills as a central barrier to
patient compliance. By allowing early refill for users of
TOPs, patients are able to manage the disease and prevent
interruptions in drug therapy that can potentially have
serious consequences. This bill seeks to provide better
patient outcomes by improving a patient's ability to adhere to
their prescribed medication regimen. Moreover, this bill
aligns state law with federal Medicare guidelines as it
relates to refill standards for TOPs.
2)California Health Benefits Review Program (CHBRP) analysis. AB
1996 (Thomson), Chapter 795, Statutes of 2002, requests the
University of California to assess legislation proposing a
mandated benefit or service and prepare a written analysis
with relevant data on the medical, economic, and public health
impacts of proposed health plan and health insurance benefit
mandate legislation. CHBRP was created in response to AB
1996. SB 125 (Hernandez), Chapter 9, Statutes of 2015, added
an impact assessment on EHBs, and legislation that impacts
health insurance benefit designs, cost sharing, premiums, and
other health insurance topics. Highlights of the CHBRP
analysis are as follows.
a) Background. TOPs, which include eye drops and
ointments, are prescribed for both acute and chronic
conditions, but this bill would most likely affect only
patients who require multiple refills to treat chronic
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diseases and conditions, including ocular hypertension,
glaucoma, uveitis, and chronic dry eye disease. TOPs are
applied to the eyes as drops or small amounts of ointment.
TOPs are not dispensed in a pre-set, quantifiable dose
(such as a pill). Accidental over-use or wastage (too many
drops at once or drops outside of the eye) can result in
early exhaustion: exhaustion before the projected period
of use for a bottle or tube of TOPs.
b) Enrollees. CHBRP estimates that in 2017, 25.2 million
Californians will have health insurance that would be
subject to this bill. The terms of coverage for 85% of
enrollees would change, where coverage had been available
for TOPs refills at and after 75% to 85% of projected use,
refills would be covered at 70% of projected use.
c) Benefit Coverage, Utilization and Cost. Currently, 15%
of enrollees have benefit coverage compliant with this
bill. The remaining 85% of enrollees have coverage for
TOPs refills at and after 75 to 85% of projected use.
Although not all enrollees with affected health insurance
would make use of the earlier refill coverage. This bill
would require refill coverage for a 30-day TOPs
prescription at or after day 21 (instead of at or after day
23 or day 26). CHBRP expects that, on average, the
post-mandate possibility of earlier refill coverage would
result in one additional refill per year among enrollees
with a chronic condition and changed benefit coverage.
This bill would be expected to increase total expenditures
(premiums and cost sharing) by 0.0007% in the 12 months
following implementation of the mandate. On a per member
per month basis, CHBRP estimates that Medi-Cal Managed Care
premiums would increase by $0.0045. For all other plans
the increase would be less than $0.003.
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d) EHBs. A number of Patient Protection and Affordable
Care Act (ACA) provisions have the potential to interact
with state benefit mandates. However, because this bill
specifies terms of existing benefit coverage, it appears it
would not exceed EHBs, and so would not trigger the ACA
requirement that the state defray the cost of additional
benefit coverage for enrollees in qualified health plans in
Covered California.
e) Medical Effectiveness and Public Health Impacts. Along
with accidental overuse and wastage, systematic adherence
to a treatment regimen contributes to early bottle
exhaustion. Therefore, this bill is mostly likely to
improve adherence among typically adherent patients. There
is insufficient evidence to suggest that the limited number
of additional days (often as few as one to three days) of
adherence made possible by this bill would measurably
impact the effectiveness of treatment. For this reason,
CHBRP does not project a measurable impact on the
population's health outcomes within the first year of the
bill's passage into law. Please note that the absence of
evidence is not evidence of no effect. It is possible that
an impact (positive or negative) could result, but current
evidence is insufficient to inform an estimate. It stands
to reason, however, that the reduction in the allowable
refill threshold may help those who have the greatest need
for the medication; those with severe chronic conditions
resulting in diminishing visual acuity.
f) Long-Term Impacts. As is the case for the first year,
there is insufficient evidence to suggest that the limited
number of additional days of adherence made possible by
this bill would measurably impact health outcomes in the
years following the bill's passage into law. However, the
average age of Californians has been increasing, and is
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expected to continue to do so. Resulting increases in
age-related chronic eye conditions may lead to greater use
of TOPs and so to greater use of the earlier refills that
this bill would require.
3)MEDICARE. On June 2, 2010, the Centers for Medicare and
Medicaid Services (CMS) re-issued guidance on "Early Refill
Edits on TOPs." The reissuance was based on complaints CMS
had received regarding the application of early refill edits
(i.e. refill-too-soon edits) to TOPs. In the guidance, CMS
stated:
To assist Part D sponsors in determining proper edits to
protect beneficiary access CMS recommends that sponsors allow
the following for TOPs:
a) Permit refills at 70% of the predicted days of use. By
way of an example, for a prescribed medication with an
expected duration of 30 days of use, the refills would be
permitted at day 21;
b) Ensure that the refill allowances are the same
regardless of purchase through retail or mail-order
sources; and,
c) Permit physicians to authorize earlier refills than 70%
days of use for particular beneficiaries who continue to
have difficulty with inadvertent wastage.
4)STATEMENT OF OPHTHALMOLOGY PROFESSIONAL SOCIETIES. In January
2014, the American Academy of Ophthalmology and the American
Glaucoma Society issued a joint statement on glaucoma eye drop
restrictions. The statement's conclusions include the
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following:
a) Eye drops are difficult to administer by over 2/3 of
patients with many having trouble accurately administering
a single drop onto their eyes;
b) Chronic medical therapy of glaucoma is a critical and
cost-effective first line of treatment. Gaps in the
treatment of glaucoma can lead to vision loss, blindness,
and an increased likelihood of surgical intervention for
their disease. Surgical intervention carries far greater
risk than chronic medical therapy and increases health care
costs. Vision loss from glaucoma has been associated with
an increase in the rates of falls, depression, difficulty
with facial recognition, inability to drive, reading
difficulty, reduced physical activity, and nursing home
admissions;
c) The current monthly volumes of eye drops allowed by
health plans are often inadequate due to common and
inadvertent wastage of drops when eye drops are applied.
Often this leads to patients either stretching out their
eye drop prescription (e.g., taking a twice daily
medication once a day) or discontinuing the use of eye
drops until the next allowable refill under their drug
plan; creating a gap in care where the patient's disease
may worsen;
d) Even in experienced glaucoma patients who
self-administer their eye drops, between 53-61% regularly
administer more than one drop at a time, many without even
realizing it. These numbers are increased in those with
poor vision from glaucoma, cataract, or retinal diseases.
Eighty percent of these patients with visual comorbidities
are unable to adequately instill a single eye drop at a
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time; and,
e) Physical disabilities, such as arthritis and tremor, can
also interfere with the administration of eye drops. It is
particularly difficult for older patients to master and
perform this task proficiently. Eye drop administration
requires both the technical ability to easily squeeze out a
single drop and the hand-eye coordination to find the eye
and squeeze the drop onto the eye.
5)SUPPORT. The California Academy of Eye Physicians and
Surgeons (CAEPS), a cosponsor of this bill, states in support
that this bill is in the patients' best interests,
particularly for glaucoma and antibiotic agents that can be
viewed as sight-saving. Running out of drops early is
particularly common in the elderly who may have difficulty
self-administering medications. While some plans allow early
refill, this bill would create a uniform requirement. CAEPS
notes this bill's current provisions are identical to those
contained in AB 2418 (Bonilla and Skinner) of 2014 which
passed the Legislature but was vetoed by the Governor because
of apparent concerns with other provisions of that bill that
were not related to TOPs. The California Optometric
Association (COA), also a cosponsor of this bill, argues that
TOPS are used to treat a wide array of acute and chronic
conditions, such as glaucoma and conjunctivitis. Glaucoma
patients are often elderly and have difficulty dispensing the
appropriate amount of eye drops, thereby requiring early
refills of their medication. It is a common occurrence for
patients to have drops hit their cheeks or to have two or more
eye drops come out of the bottle at once when only one is
needed. This unavoidable waste of drops is a major reason
that some patients run out of their drops too soon.
6)OPPOSITION. The California Association of Health Plans (CAHP)
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argues that prescription eye drops are costly and there is no
mechanism to verify if a patient's eye drops were lost or
spilled. Allowing early refills without conditions attached
could lead to improper usage and potential abuse. Allowing
the refill to be filled at a certain number of days would be
easier to track. CAHP also argues that potential state fiscal
exposure, elimination of risk management programs under the
ACA and consumer price sensitivity make this a particularly
bad time to pass additional benefit mandates. The Association
of California Health Insurance Companies and America's Health
Insurance Plans oppose all mandate bills introduced this year
because of possible state financial exposure, the need for a
robust health insurance marketplace offering competition and
choice, and the fact that mandates stifle the use of
innovative, evidence-based medicine.
7)PREVIOUS LEGISLATION. AB 2418 would have required health plan
contracts and health insurance policies to allow for the
synchronization of prescription refills, and to permit refill
of TOPs at 70% of the predicted days of use. AB 2418 was
vetoed by the Governor.
REGISTERED SUPPORT / OPPOSITION:
Support
California Academy of Eye Physicians and Surgeons (cosponsor)
California Optometric Association (cosponsor)
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American Federation of State, County and Municipal Employees,
AFL-CIO
California Congress of Seniors
Health Access California
Several individuals
Opposition
America's Health Insurance Plans
Association of California Health Insurance Companies
California Association of Health Plans
Analysis Prepared by:John Gilman / HEALTH / (916) 319-2097
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