BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 999 (Pavley) - Health insurance: contraceptives: annual
supply
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|Version: April 18, 2016 |Policy Vote: B., P. & E.D. 7 - |
| | 0, HEALTH 7 - 1 |
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|Urgency: No |Mandate: Yes |
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|Hearing Date: May 2, 2016 |Consultant: Brendan McCarthy |
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This bill does not meet the criteria for referral to the
Suspense File.
Bill
Summary: SB 999 would require health insurers and health plans
to cover up to a 12-month supply of self-administered hormonal
contraceptives.
Fiscal
Impact:
Minor costs to review information from health insurers by the
Department of Insurance (Insurance Fund).
No significant costs are anticipated to review health plan
information by the Department of Managed Health Care (Managed
Care Fund).
No significant costs or savings are projected for the Medi-Cal
program (General Fund and federal funds). According to an
analysis of the bill by the California Health Benefits Review
SB 999 (Pavley) Page 1 of
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Program, utilization of hormonal contraceptives by Medi-Cal
enrollees is not expected to increase significantly. This is
because Medi-Cal already covers up to a 12-month supply of
oral contraceptives and utilization of the other covered forms
of contraception is very low. Therefore, there is no
significant increase in utilization anticipated nor is there
an anticipated reduction in health care services related to
unintended pregnancy.
Annual premium savings to the CalPERS system of about $2
million per year, due to reduced health care costs associated
with unintended pregnancies (General Fund, special funds,
local funds). About half of those savings would accrue to the
state General Fund and special funds and half would accrue to
local governments.
No state costs to subsidize coverage through Covered
California are anticipated. Under federal law, the costs of
any state-imposed benefit mandate that exceeds the essential
health benefits included in the state's benchmark plan is a
state responsibility. In other words, if the state imposes a
new benefit mandate on health plans or health insurers that
sell coverage through Covered California, the state is
obligated to pay for the cost to subsidize that benefit
mandate for enrollees receiving federal subsidies. Because the
bill does not impose a new benefit mandate, but only changes
the terms of an existing mandate to cover contraceptives, the
bill does not expand the state's essential health benefits.
Background: Current law requires all health insurance policies or health
plans issued after January 1, 2016 to provide coverage for all
FDA-approved contraceptive drugs, devices, and other products
for women. Current law prohibits imposing cost-sharing
requirements on enrollees when receiving those benefits.
(Current law prohibits cost sharing in the Medi-Cal program
generally.)
Current regulation governing the Medi-Cal program requires
Medi-Cal managed care plans to provide coverage for up to a
12-month supply of oral contraceptives.
Under the Affordable Care Act, the federal government provides
subsidies for coverage purchased through health benefit
SB 999 (Pavley) Page 2 of
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exchanges, based on the applicant's income level. Federal law
and guidance provide that the subsidies will include the costs
of any state-imposed benefit mandates that are covered under the
essential health benefits benchmark plan. Should a state adopt
any new benefit mandate after January 1, 2012 federal subsidies
would not be available to pay for the cost of that benefit. In
other words, whenever the state mandates a new benefit on health
insurers or health plans in Covered California, the state will
have to pay the cost to subsidize that additional benefit.
Proposed Law:
SB 999 would require health insurers and health plans to cover
up to a 12-month supply of self-administered hormonal
contraceptives.
Specific provisions of the bill would:
Permit a pharmacist who furnishes self-administered
hormonal contraception to dispense up to a 12-month supply;
Require health insurance policies and health plans
issued after January 1, 2017 to cover up to a 12-month
supply of FDA-approved, self-administered hormonal
contraceptives;
Specify that the bill does not require a health insurer
or health plan to cover contraceptives provided by an
out-of-network provider;
Specify that the bill does not require a provider to
prescribe, furnish, or dispense a 12-month supply at one
time.
Related
Legislation: AB 1954 (Burke) would require health insurers and
health plans to provide coverage for reproductive and sexual
health care services through out-of-network providers. That bill
is pending in the Assembly.
Staff
Comments: According to the California Health Benefits Review
Program, the bill will result in overall health savings in the
health care industry. This is due to reduced office visits
needed to get a prescription for contraception and due to
reduced unintended pregnancies, which will reduce prenatal care
costs, abortions, and labor and delivery costs.
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The only costs that may be incurred by a local agency relate to
crimes and infractions. Under the California Constitution, such
costs are not reimbursable by the state.
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