BILL ANALYSIS Ó
AB 2507
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Date of Hearing: April 19, 2016
ASSEMBLY COMMITTEE ON HEALTH
Jim Wood, Chair
AB 2507
(Gordon) - As Introduced February 19, 2016
SUBJECT: Telehealth: access.
SUMMARY: Requires health care service plans (health plans) and
health insurers to reimburse telehealth services to the same
extent as services provided through in person. Specifically,
this bill:
1)Requires a health plan or health insurer to include in its
plan contract coverage and reimbursement for services provided
to a patient through telehealth to the same extent as though
provided in person or by some other means.
2)Requires a health plan or health insurer to reimburse a health
care provider for the diagnosis, consultation, or treatment of
the enrollee when the service is delivered through telehealth
at a rate that is at least as favorable to the health care
provider as those established for the equivalent services when
provided in person or by some other means.
3)Authorizes a health plan or health insurer to subject the
coverage of services delivered via telehealth to copayments,
coinsurance, or deductible provided that the amounts charged
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are at least as favorable to the enrollee as those established
for the equivalent services when provided in person or by some
other means.
4)Prohibits a health plan or health insurer from limiting
coverage or reimbursement based on a contract entered into
between the health plan or health insurer and an independent
telehealth provider or interfering with the physician-patient
relationship.
5)Revises the definition of telehealth to include video
communications, telephone communications, email
communications, and synchronous text or chat conferencing.
6)Provides that the requirement of telehealth shall not be
interpreted to authorize a health care provider to require the
use of telehealth when a patient prefers to be treated in an
in-person setting. Requires telehealth services to be
physician or practitioner guided and patient-preferred.
EXISTING LAW:
1)Defines telehealth as the mode of delivering health care
services and public health via information and communication
technologies to facilitate the diagnosis, consultation,
treatment, education, care management, and self-management of
a patient's health care while the patient is at the
originating site and the health care provider is at a distant
site. Telehealth facilitates patient self-management and
caregiver support for patients and includes synchronous
interactions and asynchronous store and forward transfers.
2)Requires prior to the delivery of telehealth, the health care
provider initiating the use of telehealth to inform the
patient about the use of telehealth and obtain verbal or
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written consent from the patient for the use of telehealth as
an acceptable mode of delivering health care services and
public health. Requires the consent to be documented in the
patient's medical record.
3)States that all laws regarding the confidentiality of health
care information and a patient's rights to his or her medical
information apply to telehealth interactions.
4)Exempts a patient under the jurisdiction of the Department of
Corrections and Rehabilitation or any other correctional
facility.
5)Notwithstanding any other provision of law and for purposes of
1) through 4) above, the governing body of the hospital, whose
patients are receiving the telehealth services, may grant
privileges to and verify and approve credentials for providers
of telehealth services based on its medical staff
recommendations that rely on information provided by the
distant-site hospital or telehealth entity, as described in
federal regulations. States legislative intent to authorize a
hospital to grant privileges to and verify and approve
credentials for providers of telehealth.
6)States that "telehealth" includes "telemedicine," as
specified.
7)Makes the failure of a health care provider to comply with 1)
through 6) above unprofessional conduct.
8)Provides that 1) through 7) above shall not be construed to
alter the scope of practice of any health care provider or
authorize the delivery of health care services in a setting or
in a manner not otherwise authorized by law.
9)Prohibits a health plan from requiring in-person contact to
occur between a health care provider and a patient and
limiting the type of setting where services are provided for
the patient or by the health care provider before payment is
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made for the covered services appropriately provided through
telehealth, subject to the terms and conditions of the
contract entered into between the enrollee or subscriber and
the health plan, and between the health plan and its
participating providers or provider groups.
FISCAL EFFECT: This bill has not been analyzed by a fiscal
committee.
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, there have
been rapid developments in recent years in the delivery of
health care through telehealth. Whether through improved
access to primary care physicians or cancer clinical trials,
strengthening behavioral health services in hospital emergency
departments and community clinics, or improving access to care
for both rural populations and vulnerable populations,
telehealth offers both the promise and the reality of improved
access to quality health care for all. This bill removes
barriers to health care services provided via telehealth and
ensures patient access, choice, and convenience. Increased
access to health care services through telehealth could also
result in cost reduction and cost savings. This bill would
provide a viable telehealth reimbursement infrastructure in
California in order to improve access for the state's
residents to high quality health care at a time when more
Californians have health insurance. This bill requires the
same coverage and reimbursement for services provided to a
patient through telehealth as though the patient received
equivalent services in person. The modality or how the
service is delivered should not determine whether a service
should be covered or reimbursed. Patients will benefit
through improved access to health care providers, the ability
to receive health care services in a faster and more
convenient manner, increased continuity and coordination of
care, reduction of lost work time and travel costs, and the
ability to remain near family and friends while receiving
health care services. Providers will be able to offer
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services through telehealth with a guarantee they will be
appropriately reimbursed. Providers will be incentivized to
fully build-out a vibrant, fully accessible telehealth
infrastructure to better serve Californians. A fully
developed and supported telehealth infrastructure will provide
California with economic and social benefits by: reducing the
needs of patients to leave their home or work to obtain health
care services, helping to maintain a healthy and productive
workforce and overall population, and using the same modern
technologies California is pioneering.
2)BACKGROUND.
a) Telehealth. According to the Health Resources and
Services Administration, telehealth is the use of
telecommunications and information technologies to share
information and provide clinical care, education, public
health and administrative services at a distance.
California law recognizes live video and store-and forward
(capture of medical information and transfer to providers
for later review).
This bill would expand the definition of telehealth to also
include telephone, email and synchronous text and chat
conferencing as billable telehealth modalities.
b) 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 essential health benefits, and
legislation that impacts health insurance benefit designs,
cost sharing, premiums, and other health insurance topics.
As indicated in the CHBRP analysis, this bill would require
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reimbursement parity for telehealth visits as compared to
equivalent in-person visits. This bill is not limited in
scope to established patients, and may apply to any health
care provider. CHBRP analyzed the potential impact of this
bill related to the following telehealth modalities:
- Live video (real-time interaction via video
communication);
- Store-and-forward (capture and secure transmission
of medical information, such as photo or x-rays, for
review by a health care provider at a later time);
- Telephone; and,
- Email, and synchronous text and chat.
In its review, CHBRP considered a 2013 survey from the
California Public Policy Institute which indicated that
most Californians (63%) use the Internet at least
occasionally, an increase of 21 percentage points since
2000. Sixty-nine percent of Californians have high-speed
broadband access at home but differences in access are
apparent by income, education, race, ethnicity and
geographic location. Nearly 93% of Californians report
having a cell phone, and 58% have a smart phone, with
younger age groups (18 to 34 years of age) more likely to
use a smart phone. Smart phone usage also increases with
higher education and income levels. Thirty-two percent of
Californians use the Interne to contact a health insurance
provider or medical professional (34%), whereas over half
(55%) seek out medical information online.
i) Medical Effectiveness. CHBRP indicates that the
evidence related to medical effectiveness of telehealth
varies by modality. The scope of this bill applies to
virtually all diseases and conditions. The telehealth
literature generally focuses on a limited number of
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conditions (e.g., dermatology, neurology,
psychiatry/psychology) and may not be generalizable to
other conditions. Furthermore, a major challenge in
assessing medical effectiveness of telehealth is the
speed of technological advancements in the field, which
often outpaces the research literature about these
technologies.
- Live video: There is clear and convincing
evidence that these modalities are at least as
effective as in-person care for both mental health
services and dermatology. However, this evidence may
not be generalizable to live video usage in other
specialty areas.
- Store-and-forward: For the areas studied
(e.g., in dermatology), there is a low preponderance
of evidence that medical care provided by
store-and-forward is at least as effective as medical
care provided in person. The evidence suggests that
store-and-forward technology reduces wait times for
specialty outpatient care.
- Telephone: For the areas studied (e.g.,
mental health), the studies of the effect of telephone
consultations on subsequent utilization are
inconsistent. Therefore, the evidence that medical
care provided by telephone compared to medical care
provided in person is ambiguous. Furthermore, it is
unknown whether diagnoses made using these
technologies are as accurate as diagnoses made during
in-person visits.
- E-mail, text and chat: There is insufficient
evidence to determine whether services provided by
synchronous text and chat are as effective as medical
care provided in person. CHBRP notes that the absence
of evidence does not mean there is no effect; it means
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the effect is unknown.
i) Benefit Coverage, Utilization, and Cost. This bill
would apply to all state-regulated insurance, including
DMHC Medi-Cal managed care. CHBRP estimates that in
2017, all 25.2 million Californians with state-regulated
coverage would be subject to this bill. CHBRP estimates
that postmandate, usage of telehealth services with a low
and high adoption scenario, ranging from 3.75% of total
visits delivered via telehealth postmandate to 15% of
total visits delivered via telehealth postmandate. CHBRP
estimates that in the first year postmandate, THIS BILL
would increase overall health expenditures (premiums and
out-of-pocket expenses by between $96.8 million (0.07%
change) and $402.6 million (0.28% change). CHBRP
estimates premium increases to range from $0.24 to $1.33
per member per month (PMPM) for DMHC-regulated plans,
depending on the rate of adoption. Increases range from
$0.25 to $1.09 PMPM for CDI-regulated policies, depending
on the rate of adoption. Lastly, CHBRP assumes that
out-of-pocket expenses would increase by between $15.5
million (0.10%) and $64.8 million (0.40%), depending on
the adoption of telehealth services. In reaching the
above estimates, CHBRP points out that this bill is not
limited in scope to established patients and assumed that
postmandate telehealth visits that replace existing
in-person visits (substitute) and new (supplemental)
visits that would not have taken place in person or would
not have been billed as a telehealth visit.
ii) Public Health. Patient experience would improve, as
providers increase their e-mail and telephone responses
to patient-initiated inquiries. The improvement is
partly attributable to increased access to (specialty or
primary) care, as well as improved convenience for
patients, such as reduced wait times for some visits.
For mental health and dermatology, evidence indicates that
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outcomes for live videoconferencing and store-and-forward
were equivalent to in-person care; however these results
may not be generalizable to other conditions. CHBRP
estimates that utilization would increase from
approximately 86,000 to 364,000 live videoconferencing
encounters and from approximately 1 million to 4.4
million store-and-forward encounters. For those newly
covered enrollees seeking mental health and dermatologic
care via telehealth, CHBRP estimates that positive
outcomes could occur for some with these conditions;
however, the public health impact for other conditions is
unknown.
In the case of this bill, key social determinants of health
that may be affected by the mandate include
transportation, rural living, and socioeconomic
characteristics (age, race/ethnicity, income, language).
CHBRP estimates that, postmandate, travel costs and travel
time would likely decrease for some urban and rural
enrollees using newly-covered, patient-initiated
telehealth services. As a result, some enrollees with
transportation challenges may have better outcomes
because they would no longer delay or avoid in-person
visits by favoring telephonic or electronic
communications with physicians; however, CHBRP is unable
to quantify the exact impact due to a lack of data.
It is unknown whether this bill would reduce disparities in
access to care by ameliorating the effects of certain
social determinants of health (transportation and
geography). As noted, barriers to care could be reduced
for some; however, this bill also could exacerbate
disparities in access to care for some enrollees with
certain socioeconomic characteristics (e.g., age,
language, income, etc.) that impede the use of telehealth
modalities. Lastly, it is unknown whether
patient-initiated telehealth services would result in
harms to patients. An unknown finding could result in a
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positive, negative or no impact.
iii) Impact on EHBs. This bill would not exceed EHBs.
Services would be delivered in a different way, via
telehealth, rather than be considered a new benefit.
iv) Long-term impacts. CHBRP assumes that technology
will continue to drive changes in telehealth. This
includes increased penetration of electronic health
records (EHR), associated patient portals and office
management systems; increased use of mobile and remote
communication devices (such as cellular telephones and or
medical devices) and their applications; increased
broadband coverage, which not only allows better Internet
coverage, but also easier and more rapid transfer of
large data files; and, increased demand for these types
of services from consumers, insurers, and providers.
CHBRP projects that this trend, along with changes in
reimbursement, would likely increase use of telephone,
e-mail, and other telehealth services between patients
and providers; however, the impact of telehealth on
health outcomes requires further study.
a) Other states. According to CHBRP, in 2015, state
legislatures in 42 states introduced over 200
telehealth-related bills. States vary greatly in the
definition and regulation of telehealth. Forty-eight
states and the District of Columbia have a codified
definition of telehealth (or telemedicine) in law,
regulations or in their Medicaid programs while Rhode
Island and New Jersey do not have an established legal
definition for telehealth. The vast majority of states
(47) and the District of Columbia reimburse for some type
of telehealth service in their Medicaid programs. This is
an increase from 44 state Medicaid programs in 2014. Among
these states, live video is the most commonly reimbursed
form of telehealth, with all 47 states reimbursing for live
video. However, the terms and conditions related to live
video reimbursement vary widely across states. As of July
2015, California is one of nine states that reimburses for
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store-and-forward in its Medicaid program; the other states
are Alaska, Arizona, Illinois, Minnesota, Mississippi, New
Mexico, Oklahoma, and Virginia. Sixteen states' Medicaid
programs reimburse for remote patient monitoring;
California does not. Four states' Medicaid programs
(Alaska, Illinois, Minnesota, and Mississippi) reimburse
for live video, store-and-forward, and remote patient
monitoring.
Thirty-one states and the District of Columbia have laws in
place which regulate telehealth reimbursement among private
payers. Washington State has passed such legislation
scheduled to go into effect January 1, 2017. There is much
variation among these laws; some do not require
reimbursement while some require reimbursement parity
between telehealth services and the same service delivered
in-person. At least 23 states have "full parity" in place
wherein both coverage and reimbursement for telehealth
services are comparable to in-person services.
b) Federal Requirements. Medicare payment for telehealth
services is established in Section 1834 (m) of the Social
Security Act. Medicare reimbursement for telehealth
services is conditioned on the originating site (location
of the patient) being located in a non-metro county or in a
primary care or mental health geographic Health
Professional Shortage Area. Medicare reimburses for
synchronous live video and for in a demonstration program
in Alaska or Hawaii, reimburses for asynchronous
store-and-forward. Medicare does not pay for telephone or
e-mail encounters.
c) Department of Veterans Affairs. According to CHBRP, the
federal Department of Veterans Affairs (VA) has an Office
of Telehealth Services and is considered a leader in the
integration and use of the technologies. The VA defines
telehealth to include clinical video telehealth, store and
forward, and home telehealth (chronic disease management
through remote patient monitoring for conditions such as
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diabetes, chronic heart failure, chronic obstructive
pulmonary disease, depression, or post-traumatic stress
disorder. The VA also has secure messaging features that
allow patients to communicate via a web portal or their
mobile devices, and mobile health, defined as smart phone
applications for self-management or health conditions.
Email is not included in the VA's definition of telehealth.
d) Kaiser Permanente. Kaiser Permanente Northern California
(KPNC) is a unique example of an integrated health care
delivery system using all four telehealth modalities. KPNC
serves approximately 3.4 million enrollees through 8,000
physicians and 21 hospitals. In 2008, KPNC implemented an
inpatient and ambulatory care EHR system that includes more
than 100 patient-centered Internet, mobile, and live
videoconferencing applications enabling members to review
disease-specific information; access personal health
information; make appointments, order refills, exchange
secure e-mail messages with providers; and participate in
virtual care in lieu of an office visit. KPNC's number of
virtual visits grew from 4.1 million in 2008 to 10.5
million in 2013, and telephone visits increased from about
640,000 in 2008 to more than 2.3 million in 2013. KPNC
estimates that by 2016, virtual visits (e-mail, telephone,
video) would outnumber in-person office visits, which have
remained constant since 2008.
e) Rural Health Disparities and Travel Barriers in
California. In its analysis, CHBRP must include a
discussion of disparities under the broader umbrella of
social determinants of health (SDoH). SDoH include factors
outside of the traditional medical care system that
influence health status and health outcomes. In the case of
this bill, evidence shows that disparities in certain
determinants including geographic location, (accessible)
transportation and access to and use of technology.
Residents of rural communities in California experience
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poorer health status compared to residents of urban
communities, such as higher self-reported poor health
status (6.1% in rural vs. 4.4% in urban), recent mental
health issues (37.8% rural vs. 34.1% urban), physical
health issues (52.8% rural vs. 40.3% urban) and recent
inability to engage in work, recreation, or self-care
(27.0% rural vs. 21.4% urban) (CalSORH, 2013). Travel
barriers and inadequate provider-patient ratios are
telehealth-relevant factors that contribute to rural health
disparities (Iezzoni et al., 2006; Weinhold and Gurtner,
2014). About 14% (5.2 million) of California's 37.7 million
residents live in rural areas (CalSORH, 2013) and in about
two-thirds of counties, the number of physicians per capita
is less than what is considered adequate to meet demand
(CHCF, 2012).
Telehealth may help to overcome some of the disparities in
health care by redistributing knowledge and expertise when
and where it is needed, including rural areas of California
(Nesbitt, 2012). However, telehealth has yet to meet rural
demand according to one study. Of 60 California rural
health clinics surveyed in 2012, less than half (47%) used
telehealth; 47% used live videoconferencing, 5% used
store-and-forward, and 3% used home monitoring. Cost of
equipment and lack of arrangements with specialists were
the primary obstacles to clinic participation (52% and 48%,
respectively) (CHCF, 2012). About half of the clinics used
the Internet to contact other providers, but just 12% did
so to contact patients (CHCF, 2012). In recognition of the
ongoing challenge to provide accessible clinical services
to rural residents, the federal Office of Rural Health
Policy established an Office for the Advancement of
Telehealth to promote telehealth grants and programming for
clinical care, education, and public health in rural areas.
1)SUPPORT. According to the sponsor, Stanford Health Care, this
bill seeks to fulfill the promise of telehealth and further
improves access to health care by ensuring that providers and
recipients of telehealth services have guaranteed coverage and
reimbursement for telehealth services that are physician or
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practitioner-guided and retains patient choice.
The California Primacy Care Association points out that with
this bill, providers will be incentivized to fully build-on a
vibrant, fully accessible telehealth infrastructure to better
serve Californians.
The American Association for Marriage and Family Therapy,
California Division, opines that the provision expressly
prohibiting health care providers from forcing patients into
telehealth services when the patient has a preference for
in-person treatment forges a balance between ensuring access
to health care via telehealth while protecting patients who
wants to be seen in person.
Adventist Health, John Muir Health El Camino Hospital indicate
that existing law does not guarantee health care providers
will be reimbursed for telehealth services, and this bill
removes this barrier and improves patient access, choice, and
convenience to quality healthcare.
The Association of California Healthcare Districts indicates
that rural and underserved areas have a difficult time
recruiting health professionals to their areas, and this bill
is one solution to this problem. A reliable reimbursement
mechanism ensures that telehealth services are available
across the state, particularly in rural areas where healthcare
districts operate.
2)OPPOSITION. The California Association of Health Plans, the
Association of California Life and Health Insurance Companies
and America's Health Insurance Plans indicate that they have
taken important steps over the last decade to address the
critical issues of increasing access to innovative, quality
health care products, and cost control mechanisms that better
allow individuals and small businesses to obtain coverage in
the private market. This bill threatens the efforts of all
health care stakeholders to provide consumers with meaningful
health care choices and affordable coverage options.
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3)RELATED LEGISLATION. SB 289 (Mitchell) of 2015, would have
required health plans or health insurers to cover telephonic
and electronic patient management services provided by a
physician or non-physician health care provider and reimburse
those services based on their complexity and time expenditure.
SB 289 was held in the Senate Appropriations Committee.
4)PREVIOUS LEGISLATION.
a) AB 1771 (V. Manuel Pérez), of 2014, would have required
health plans and health insurers, with respect to plan
contracts and insurance policies issued, amended, or
renewed on or after January 1, 2016, to cover telephone
visits provided by a physician. AB 1771 was held in the
Senate Appropriations Committee.
b) AB 809 (Logue), Chapter 404, Statutes of 2014, revises
the informed consent requirements relating to the delivery
of health care via telehealth by permitting consent to be
made verbally or in writing, and by deleting the
requirement that the health care provider who obtains the
consent be at the originating site where the patient is
physically located.
c) AB 1733 (Logue), Chapter 782, Statutes of 2012,
specifies that the prohibition on requiring in-person
contact also applies to other health care service plan
contracts with the Department of Health Care Services
(DHCS) for services under the Medi-Cal program, and
publicly supported programs other than Medi-Cal, as well as
to the organizations implementing the PACE program.
d) AB 415 (Logue), Chapter 547, Statutes of 2011, among
other provisions, prohibits DHCS from requiring that a
health care provider document a barrier to an in-person
visit prior to paying for services provided via telehealth
to a Medi-Cal beneficiary. Repeals the prohibition of
paying for a service provided by telephone or facsimile and
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would instead prohibit DHCS from limiting the type of
setting where services are provided for the patient.
Prohibits health plans and insurers from requiring that
in-person contact occur between a health care provider and
a patient before payment is made for the services
appropriately provided through telehealth, subject to the
terms of the relevant contract. Repeals the prohibition
for paying for a service provided by telephone or facsimile
and would instead prohibit health plans and insurers from
limiting the type of setting where services are provided
for the patient or by the health care provider.
e) SB 1665 (Thompson), Chapter 864, Statutes of 1996,
established the Telemedicine Development Act (TDA) to set
standards for the use of telemedicine by health care
practitioners and insurers. TDA specifies, in part, that
face-to-face contact between a health care provider and a
patient shall not be required under the Medi-Cal program
for services appropriately provided through telemedicine,
when those services are otherwise covered by the Medi-Cal
program, and requires a health care practitioner to obtain
verbal and written consent prior to providing services
through telemedicine.
5)Amendments. The author has agreed to amend this bill to do
the following:
a) Narrow the scope of this bill to apply only to video and
telephonic communications;
b) Clarify that the bill shall not be interpreted to
prohibit a health plan to undertake a utilization review of
telehealth services, provided the utilization review is
equivalent in application when provided in person or by
some other means;
c) Clarify that this bill does not alter the scope of
practice of any health care providers; and,
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d) Maintain the confidentiality of healthcare information
and the patient's right to his or her medical information
applies to telehealth services.
REGISTERED SUPPORT / OPPOSITION:
Support
Stanford Health Care (sponsor)
AARP California
Adventist Health
ALS Association Golden West Chapter
American Association for Marriage and Family Therapy
Association of California Healthcare Districts
California Academy of Family Physicians
California Association of Health Plans
California Children's Hospital
California Life Sciences Association
California Medical Association
California Primary Care Association
Center for Information Technology Research in the Interest of
Society
Center for Technology and Aging
The Children's Partnership
El Camino Hospital
Health Care Interpreters Network
John Muir Health
Lucile Packard Children's Hospital
National Multiple Sclerosis Society
Occupational Therapy Association of California
Providence Health & Services
Sutter Health
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Opposition
America's Health Insurance Plans
Association of California Life and Health Insurance Companies
California Association of Health Plans
California Chamber of Commerce
California Right to Life Committee, Inc.
Analysis Prepared by:Rosielyn Pulmano / HEALTH / (916) 319-2097