BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session AB 2640 (Gipson) - Public health: HIV ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: August 2, 2016 |Policy Vote: HEALTH 7 - 1 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: August 8, 2016 |Consultant: Brendan McCarthy | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 2640 would require a health care provider administering an HIV test to provide information on preexposure prophylaxis (PrEP) and postexposure prophylaxis (PEP) to a patient determined to be at high risk for HIV infection. Fiscal Impact: Likely ongoing costs in the millions to low tens of millions to provide PrEP and PEP to high-risk individuals enrolled in Medi-Cal (General Fund and federal funds). Based on Centers for Disease Control and Prevention estimates for the number of individuals at high risk for HIV infection, staff estimates that there are about 150,000 individuals in the state that would meet CDC guidelines for using PrEP or PEP. For each 1% of that population that elects to begin taking PrEP, the proportional cost to the Medi-Cal program to cover the cost of providing PrEP would be about $4 million per year. (Costs for PEP would be considerable lower, since it is only recommended for 28-day use, as opposed to ongoing use for PrEP.) AB 2640 (Gipson) Page 1 of ? Unknown long-term savings to Medi-Cal and the Aids Drug Assistance Program due to lower HIV infection rates (General Fund and federal funds). To the extent that the bill does result in lower HIV infection rates, there would be cost savings to the Medi-Cal and Aids Drug Assistance Programs. However, there are some factors that limit the potential cost savings from the bill. First, it is not known how effective greater knowledge and use of PrEP and PEP are at the population level in reducing HIV infection. There are clinical studies that show a very dramatic decline in HIV infections amongst users of PrEP. Whether those findings would translate to the larger population not part of a research study is unknown. Second, the annual cost to provide PrEP is may not be substantially less than the current cost to provide treatment to HIV positive Medi-Cal beneficiaries. The cost that Medi-Cal would pay for PreP is not public information. However, the New York State Department of Public Health indicates that annual costs range from $8,000 to $14,000 per year. Even assuming that Medi-Cal receives significant discounts, the cost to provide PreP is likely to be in the thousands per patient per year. On the other hand, the current average annual cost of care for an HIV positive Medi-Cal beneficiary is about $15,000 per year. Background: Under current law, patients who have blood drawn at primary care clinics must be offered an HIV test by the clinic. Under state and federal law, the Department of Health Care Services operates the Medi-Cal program, which provides health care coverage to low income individuals, families, and children. Medi-Cal provides coverage to childless adults and parents with household incomes up to 138% of the federal poverty level and to children with household incomes up to 266% of the federal poverty level. The federal government provides matching funds that vary from 50% to 90% of expenditures depending on the category of beneficiary. In addition, the Department of Public Health manages the Aids Drug Assistance Program which offers coverage for treatment of HIV to those who do not qualify for Medi-Cal. Current law mandates that all individual and group health plans AB 2640 (Gipson) Page 2 of ? and insurance policies provide coverage for HIV testing. Under current law, specific information must be provided by a health care provider who is administering an HIV test, for both individuals testing positive and individuals testing negative who are at high risk for HIV infection. Proposed Law: AB 2640 would require a health care provider administering an HIV test to provide information on preexposure prophylaxis (PrEP) and postexposure prophylaxis (PEP) to a patient who tests negative but is determined to be at high risk for HIV infection. Related Legislation: AB 2439 (Gipson) would create a pilot project to assess the effectiveness of routinely offering HIV tests in the emergency department of a hospital. That bill will be heard in this committee. Staff Comments: There is a great deal of uncertainty in how individuals at high risk of HIV infection will respond to receiving information about PrEP and PEP. Assuming even a small number of such individuals who test negative for HIV would seek PrEP, costs to the Medi-Cal program could be substantial. Of course, any action that reduces HIV infection would have substantial population health benefits and would lead to cost savings to Medi-Cal. -- END --