BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     SB 999


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          SENATE THIRD READING


          SB  
          999 (Pavley)


          As Amended  August 19, 2016


          Majority vote


          SENATE VOTE:  29-6


           -------------------------------------------------------------------- 
          |Committee       |Votes|Ayes                   |Noes                 |
          |                |     |                       |                     |
          |                |     |                       |                     |
          |                |     |                       |                     |
          |----------------+-----+-----------------------+---------------------|
          |Health          |13-0 |Wood, Maienschein,     |                     |
          |                |     |Bonilla, Campos, Chiu, |                     |
          |                |     |                       |                     |
          |                |     |                       |                     |
          |                |     |                       |                     |
          |                |     |Roger Hernández,       |                     |
          |                |     |Lackey, Nazarian,      |                     |
          |                |     |Olsen, Ridley-Thomas,  |                     |
          |                |     |Rodriguez, Thurmond,   |                     |
          |                |     |Waldron                |                     |
          |                |     |                       |                     |
          |----------------+-----+-----------------------+---------------------|
          |Business &      |13-2 |Salas, Baker, Bloom,   |Brough, Jones        |
          |Professions     |     |Campos, Chávez, Dodd,  |                     |
          |                |     |Eggman, Gatto, Gomez,  |                     |
          |                |     |Holden, Mullin, Ting,  |                     |
          |                |     |Wood                   |                     |








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          |                |     |                       |                     |
          |----------------+-----+-----------------------+---------------------|
          |Appropriations  |15-3 |Gonzalez, Bloom,       |Bigelow, Jones,      |
          |                |     |Bonilla, Bonta,        |Wagner               |
          |                |     |Calderon, Daly,        |                     |
          |                |     |Eggman, Eduardo        |                     |
          |                |     |Garcia, Holden,        |                     |
          |                |     |Obernolte, Quirk,      |                     |
          |                |     |Santiago, Weber, Wood, |                     |
          |                |     |Chau                   |                     |
          |                |     |                       |                     |
          |                |     |                       |                     |
           -------------------------------------------------------------------- 


          SUMMARY:  Requires coverage for up to a 12-month supply of Food  
          and Drug Administration (FDA) approved, self-administered  
          hormonal contraceptives (contraceptives) and permits pharmacists  
          to dispense these contraceptives consistent with existing  
          protocols and upon a patient's request.  States that this bill  
          and SB 253 (Monning) both amend the same code sections, and each  
          should be amended to avoid chaptering out the other, should both  
          bills be enacted.


          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee: 


          1)According to the California Health Benefits Review Program  
            (CHBRP), this bill will result in overall health savings in  
            the health care industry due to reduced office visits and  
            reduced unintended pregnancies, which will reduce prenatal  
            care, abortions, and labor and delivery costs.  Costs by payer  
            are as follows: 


             a)   No significant costs or savings to Medi-Cal managed care  
               (General Fund (GF)/federal).  CHBRP notes utilization of  








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               hormonal contraceptives by Medi-Cal enrollees is not  
               expected to increase significantly, 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.  
             b)   Annual premium cost savings to California Public  
               Employees' Retirement System of about $2 million per year,  
               due to reduced health care costs associated with unintended  
               pregnancies (GF/ special/ federal/ local).  Cost savings  
               are split approximately 50/50 between state and local  
               government.


             c)   Annual employer-funded premium cost savings in the  
               private insurance market of approximately $12.5 million. 


             d)   Decreased premium expenditures by employees and  
               individuals purchasing insurance of $9.4 million, and  
               reduced total out-of-pocket expenses of $18.7 million. 


          1)The Department of Health Care Services (DHCS) notes an impact  
            to fee-for-service Medi-Cal and Family Planning Access to Care  
            and Treatment (Family PACT) in the amount of $38.3 million  
            ($7.9 million GF/remainder federal).  Based on CHBRP's  
            analysis of the impact of a 12-month supply on unintended  
            pregnancies, this cost appears likely to be fully offset by  
            reductions in costs for unintended pregnancies, office visits,  
            abortions, and other services. 


          2)Minor costs to the California Department of Insurance (CDI  
            Insurance Fund) and the Department of Managed Health Care  
            (DMHC Managed Care Fund) to verify plans and insurers comply  
            with this requirement.








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          COMMENTS:  According to the author, California has required  
          insurance coverage for FDA-approved contraception since 1998,  
          but many hurdles remain.  Under current law, health insurance  
          companies and plans must limit coverage of birth control to a  
          one or three month supply.  This practice can lead to unwanted  
          gaps in birth control use and an increased incidence of  
          unintended pregnancies.  The author cites a University of  
          California San Francisco study that found that women who  
          received a full year's worth of birth control pills at one time  
          were 30% less likely to have an unintended pregnancy than women  
          who received a one or three month supply.  The author states  
          that there is growing momentum nationwide to provide annual  
          dispensing.  


          CHBRP analysis.  CHBRP estimates that in 2016, 25.2 million  
          Californians have state-regulated coverage that would be subject  
          to this bill.  CHBRP estimates that total net annual  
          expenditures would decrease by $42.8 million or 0.03% for  
          enrollees with DMHC-regulated plans and CDI-regulated policies.   
          This represents the anticipated savings in 2017 due to the  
          avoidance of unintended pregnancies (leading to reduced  
          delivery, miscarriage, and abortion costs) and the reduced  
          number of office visits in the first year postmandate.  The  
          decrease in total expenditures is due to a $24 million decrease  
          in total health insurance premiums paid by employers and  
          enrollees, along with a decrease in enrollee out-of-pocket  
          expenditures ($18.7 million), for an overall net decrease of  
          $42.8 million.  Additionally, there is a preponderance of  
          evidence to indicate that dispensing oral contraceptives in  
          larger quantities leads to a reduction in unintended pregnancy  
          and related outcomes.  However, fewer studies examine the effect  
          of the amount of dispensed supply of self-administered hormonal  
          contraceptives, the primary impact of this bill.  


          California Family Planning Program.  Family PACT is a  








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          reproductive health program for clinical family planning  
          services.  Family PACT provides comprehensive family planning  
          services to women and men including all FDA-approved forms of  
          contraception, emergency contraception, pregnancy testing with  
          counseling, preconception counseling, male and female  
          sterilization, limited infertility services, sexually  
          transmitted infection testing and treatment, cancer screening,  
          and HIV screening.  Individual client reproductive health  
          education and counseling is an ongoing component of all  
          services.  Family PACT clients are female and male residents of  
          California with a family income at or below 200% of the federal  
          poverty level with no other source of family planning coverage.   
          Clients are individuals with a medical necessity for family  
          planning services who do not have Medi-Cal and do not have  
          access to health insurance.  Medi-Cal clients with an unmet  
          share of cost may also be eligible.  Eligibility determination  
          and enrollment are conducted at the provider's office with point  
          of service activation of a client membership card.


          Medi-Cal requirements.  According to a recently revised All Plan  
          Letter (APL) issued by the DHCS, effective May 1, 2016, Medi-Cal  
          managed care plans (MCPs) must pay for up to 13 cycles of oral  
          contraceptives, up to 12 patches in a 90 day period, and up to  
          four vaginal rings in a 90 day period if such quantity is  
          dispensed in an onsite clinic and billed by a qualified family  
          planning provider, including out-of-plan providers.  The APL  
          also states that under federal law, a primary care case  
          management system, a health maintenance organization, or a  
          similar entity shall not restrict the choice of the qualified  
          person from whom the individual may receive such services under  
          1396d(a)(4)(C) of Title 42.  Therefore MCP beneficiaries must be  
          allowed freedom of choice of family planning providers, and may  
          receive such services from any qualified family planning  
          provider, including out-of-plan providers, without prior  
          authorization.  In addition to applying to MCPs, this bill  
          requires DHCS to issue APLs or similar instructions to implement  
          this bill.  









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          Analysis Prepared by:                                             
                          Kristene Mapile / HEALTH / (916) 319-2097  FN:  
          0004609