BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1831|
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THIRD READING
Bill No: AB 1831
Author: Low (D)
Amended: 8/15/16 in Senate
Vote: 21
SENATE HEALTH COMMITTEE: 9-0, 6/22/16
AYES: Hernandez, Nguyen, Hall, Mitchell, Monning, Nielsen,
Pan, Roth, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/11/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
ASSEMBLY FLOOR: 71-8, 6/1/16 - See last page for vote
SUBJECT: Health care coverage: prescription drugs: refills
SOURCE: California Academy of Eye Physicians and Surgeons
California Optometric Association
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DIGEST: This bill requires a health plan contract or health
insurance policy issued, amended, or renewed on or after July 1,
2017 that provides coverage for prescription drug benefits to
allow for early refills of covered topical ophthalmic products,
as specified.
ANALYSIS:
Existing law:
1)Regulates health plans by the Department of Managed Health
Care (DMHC) and health insurers by the California Department
of Insurance (CDI). Establishes the Department of Health Care
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Page 2
Services to administer the Medi-Cal program.
2)Requires health 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 ten 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.
This bill:
1)Requires a health plan contract or health insurance policy
issued, amended, or renewed on or after July 1, 2017 that
provides coverage for prescription drug benefits to allow for
early refills of covered topical ophthalmic products (TOPs)
according to the following standards:
a) For a 30-day supply, at least 23 days and less than 30
days from the later of either the original date that the
prescription was distributed to the enrollee, or the date
of the most recent refill that was distributed to the
enrollee;
b) For a 90-day supply, at least 68 days and less than 90
days from the later of either the original date that the
prescription was distributed to the enrollee or the date of
the most recent refill that was disturbed to the enrollee;
and,
c) The refills requested by the enrollee not exceed the
number of additional quantities prescribed by the
enrollee's participating health plan provider.
2)Prohibits anything in this bill from being construed to
prevent a plan or insurer from allowing early refills at or
below 75% of the predicted days of use, establish a new
mandated benefit or to prevent the application of deductible
or copayment provisions in a plan contract.
AB 1831
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Comments
1)Author's statement. According to the author, TOPs are used to
treat a wide array of acute and chronic conditions, such as
glaucoma and conjunctivitis. Patients often have difficulty
self-administering the appropriate amount of eye drops,
thereby requiring early refills of their medication.
Interruptions in drug therapy for eye-related conditions
potentially have serious consequences, like irreversible
vision loss. Thus, AB 1831 seeks to provide better patient
outcomes by improving a patient's ability to adhere to
medication dispensing requirements. Moreover, this bill aligns
state law with federal Medicare guidelines as it relates to
refill standards for topical ophthalmic products.
2)California Health Benefits Review Program (CHBRP) analysis.
AB 1996 (Thomson, Chapter 795, Statutes of 2002), requested
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.
Below are key findings of CHBRP's analysis.
TOPs are a class of drugs that include eye drops and ointments
that are used to treat multiple eye diseases and conditions.
TOPs can be prescribed for both acute and chronic conditions.
Chronic eye conditions would include diseases with long-term
treatments, lasting months, years, or the rest of patients'
lives. AB 1831 would most likely affect a subset of patients
who require multiple refills of TOPs to treat chronic
diseases.
Studies using pharmacy claims data have shown that up to 90%
of glaucoma patients do not refill their TOP medication
consistently (i.e., in a way that would permit continuous
availability of TOPs) and that approximately 25% of patients
may be without eye drops an average of 109 days per year
(Gurwitz et al., 1998; Nordstrom et al., 2005; Quigley and
Broman, 2006). However, these studies could not clarify the
reasons or consequences of refill inconsistency, such as if
this is due to behavioral factors or issues with obtaining a
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refill, or if patients' vision was deteriorating as a result.
Specific to the issue of running out of TOP medication, 25% of
a sample of glaucoma patients reported experiencing any early
exhaustion of eye drop bottles (i.e., running out of eye drops
before they were due to be refilled), with 5% reporting early
bottle exhaustion five or more times a year (Moore et al.,
2014). Poor vision was a risk factor for early exhaustion
among those who run out at least five times per year. The top
reasons patients cited for early TOP exhaustion were that more
than one drop came out (31%), there was an insufficient amount
in the bottle (18%), or the drop size was too large or
inconsistent (18%) (Moore et al., 2014).
a) Enrollees. CHBRP estimates that in 2017, 25.2 million
Californians will have health insurance that would be
subject to AB 1831.
b) Impact on expenditures. An increase of 0.0007% or
$955,000 (premiums and cost sharing) would occur.
c) EHBs. The mandate would alter the terms but not require
new benefit coverage and so would not exceed EHBs.
d) Medical effectiveness. There is insufficient evidence
to suggest that the limited number of additional days of
adherence made possible by AB 1831 would measurably impact
the effectiveness of treatment or related health outcomes.
e) Benefit coverage. 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.
f) Utilization. Due to earlier refills, annual utilization
of TOPs would increase by 0.5%.
g) Public health. Due to insufficient medical
effectiveness evidence and unlikely impact on adherence
despite very limited increases in filled prescriptions, the
public health impact on health outcomes, gender or
racial/ethnic disparities, and premature death in the first
year, post-mandate, is unknown. CHBRP notes 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.
3)Other states and Medicare. According to CHBRP, there are laws
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relevant to coverage for early refills for TOPs in a number of
other states, including AK, CT, KY, MO, NJ, NY, OR, RI, and
WY.
4)Medicare Part D. On June 2, 2010 the Centers for Medicare &
Medicaid Services (CMS) released the following guidance to
Medicare Part D sponsors related to TOPs. "CMS is re-issuing
this guidance based on complaints we have received regarding
the application of early refill edits (i.e. refill-too-soon
edits) to TOPs. CMS recognizes that early refill edits are an
important utilization management tool used to promote
compliance and prevent waste. However, it is equally important
that Part D sponsors implement such edits in a manner that
does not unreasonably put beneficiaries at risk of
interruptions in drug therapy that potentially have serious
consequences. Part D sponsors need to take into consideration
differences that some dosage forms, such as topical
ophthalmics, present when establishing early refill edits.
Edits based on an algorithm that is appropriate for tablets
and capsules are not necessarily appropriate for other dosage
forms for which administration is not as easily measured and
controlled. This is not to say that Part D sponsors should not
implement early refill edits for such medications, especially
given that these edits can identify inappropriate use, but it
does mean that such edits need to reasonably accommodate waste
that can be anticipated given the nature of these products and
their self-administration among the Medicare patient
population. Part D sponsors also should be prepared to allow
overrides of these edits on a case-by-case basis when
appropriate and necessary to prevent unintended interruptions
in drug therapy."
Related/Prior Legislation
AB 2418 (Bonilla of 2014), would have required health plan
contracts and health insurance policies to allow for the
synchronization of prescription refills, and permit refill of
topical ophthalmic medications at 70% of the predicted days of
use, effective January 1, 2016. AB 2418 was vetoed by the
Governor. The Governor's veto message included the following:
The bill would require health plans and insurers to
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apply a prorated daily cost-sharing rate to the refills
of certain medications if the prescriber or pharmacist
indicates it is in the best interest of the patient and
it is for the purpose of synchronizing refill dates for
the patient's medications. The bill also allows for
early refills of covered eye products. While I
understand the importance of encouraging people to take
their prescribed medications, the bill lacks explicit
patient consent before changes are made to refills; nor
does the bill speak to the supportive elements that
have made synchronization programs anecdotally
successful. Medication adherence is complicated.
Solutions to this problem will likely require a more
holistic approach and collaboration between doctors,
patients, pharmacists and health plans.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
According to the Senate Appropriations Committee:
1)Minor costs to review health insurer filings and take
enforcement actions, as necessary, by CDI (Insurance Fund).
2)Minor costs to review health plan filings and take enforcement
actions, as necessary, by DMHC (Managed Care Fund).
3)Ongoing costs of about $200,000 per year for increased
utilization of covered TOPs by Medi-Cal beneficiaries (General
Fund and federal funds). CHBRP analyzed a prior version of the
bill that would have required early refills at 70% of
predicted use days. Based on the current version of the bill,
which requires early refills at 76% - 77% of predicted days,
the costs to the Medi-Cal program are likely to be about
one-half of the previously projected costs.
4)Minor costs to the CalPERS due to increased prescription drug
benefit costs (various funds). Similar to the costs projected
for the Medi-Cal program, the costs of the current bill are
likely to be about one-half of the previously projected costs.
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5)No state cost to subsidize health care coverage through
Covered California is anticipated. Under federal law, any new
mandated health benefit that exceeds the benefits in the
state's essential health benefits benchmark plan would be a
state responsibility. In other words, to the extent that the
state imposes a new benefit mandate that exceeds the essential
health benefits benchmark, the state would be responsible for
paying for the cost to subsidize that benefit for those
individuals who are receiving subsidized coverage through
Covered California. Because this bill does not mandate a new
benefit, but only change the terms of an existing benefit
(prescription drugs), the bill is not expected to result in
the state being responsible for subsidizing coverage.
SUPPORT: (Verified 8/12/16)
California Academy of Eye Physicians and Surgeons
California Optometric Association
American Federation of State, county and Municipal Employees
California Life Sciences Association
California Pharmacists Association
Community Health Partnership
Congress of California Seniors
Health Access California
Roots Community Health Center
Several Individuals
OPPOSITION: (Verified8/12/16)
Department of Health Care Services
ARGUMENTS IN SUPPORT: The California Academy of Eye
Physicians writes this legislation is in patient's best
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interests, particularly for anti-glaucoma and antibiotic agents
that can be viewed as site saving. The California Optometric
Association writes that CMS stressed the necessity for early
refills to prevent interruptions in drug therapy that
potentially have serious consequences. According to the
California Life Sciences Association TOPs, such as eye drops,
can be difficult to apply and it is often common for patients to
waste or use more eye drops than necessary when drops hit their
cheeks or two eye drops come out at once. They are used to
treat a variety of conditions including glaucoma,
conjunctivitis, among others. Diseases like glaucoma, when
inadequately treated or untreated, can result in irreversible
vision impairment and blindness. The Community Health
Partnership writes that when a patient runs out of eye drops, a
patient may have to pay the full cost of the prescription if he
or she runs out of eye drops before the scheduled refill. When
faced with the option of paying full price for the prescription
or waiting until the scheduled refill date, many low-income
patients may choose to go without the medication for weeks
instead of paying out of pocket. Interruptions in drug therapy
for eye-related conditions potentially have serious
consequences, including irreversible vision loss.
ARGUMENTS IN OPPOSITION: The Department of Health Care Services
(DHCS) opposes this bill because it places a mandate on Medi-Cal
managed care plans and it could unnecessarily increase
utilization and medication misuse. DHCS also believes an
override process already allows for a pharmacist to provide
early refills, if necessary.
ASSEMBLY FLOOR: 71-8, 6/1/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos,
Chang, Chau, Chávez, Chiu, Cooley, Cooper, Dababneh, Dahle,
Daly, Dodd, Eggman, Frazier, Gallagher, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Hadley, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey,
Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes,
McCarty, Medina, Mullin, Nazarian, O'Donnell, Olsen, Quirk,
Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark
Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams,
Wood, Rendon
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NOES: Bigelow, Beth Gaines, Grove, Harper, Roger Hernández,
Melendez, Obernolte, Patterson
NO VOTE RECORDED: Chu
Prepared by:Teri Boughton / HEALTH / (916) 651-4111
8/15/16 19:36:07
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