BILL ANALYSIS
AB 1826
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Date of Hearing: May 19, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 1826 (Huffman) - As Amended: April 28, 2010
Policy Committee: Health Vote:11-6
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill requires health plans and health insurers to provide
coverage for a medication prescribed for pain without first
requiring a patient to use an alternative prescription or
over-the-counter product.
By establishing this mandate, this bill prohibits the use of
"step therapy" or "fail-first" protocols. Step therapy is the
practice of beginning drug therapy with the most cost-effective
and safest drug therapy and progressing to other more costly or
risky medications, as necessary. Fail-first protocols require
proof a patient has tried other medications before the preferred
medication is approved.
FISCAL EFFECT
1)According to the California Health Benefits Review Program
(CHBRP) annual increased costs to Medi-Cal and the Healthy
Families Program, combined, of more than $10 million (50% GF
and 33% GF, respectively). The bill exempts CalPERS from the
requirements established by this bill.
2)Increased premium costs in the private insurance market of
more than $11 million.
3)Recent amendments were adopted to address cost concerns
related to the bill being construed as prohibiting generic
drug substitutions. According to a subsequent review by CHBRP
of the bill and amendments, the cost impacts remain unchanged.
COMMENTS
AB 1826
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1)Rationale . This bill is sponsored by For Grace, a group
focused on increasing awareness of the gender disparity women
experience in the assessment and treatment of pain. According
to the author and sponsors, some patients are required to try
up to five medications prior to being prescribed a recommended
pain drug. The author indicates these treatment decisions
should be left up to provider and patient, not the health plan
or insurer.
2)Background . Health plans and pharmacy benefit managers use
strategies such as step therapy and fail-first protocols to
balance cost, quality, and utilization concerns. Cost control
and clinical considerations include proof of medication
intolerance, prevention of unapproved use, and adherence to
clinical guidelines. Step therapy requires a patient to try a
specified medication, often a generic alternative, prior to
receiving coverage for a second-line medication. A fail-first
protocol may require a patient to confirm to a health plan
that alternate medications have been unsuccessfully tried by
the patient before the preferred medication is covered.
According to CHBRP, of the more than 200 prescription drugs
used to treat pain, 54 are subject to first-fail protocols for
a portion of insured patients.
3)Focus on Pain Medication . This bill singles out a cohort of
prescription medications, those used to treat pain. There are
several hundred different medications used to treat pain
associated with numerous medical conditions. Included in this
group of medications are potent, potentially addictive and
dangerous drugs, including narcotics. Narcotics are
increasingly associated with addiction and overdose.
Strategies such as step therapy and first-fail protocols
provide tools to ensure these kinds of medications are taken
safely and conservatively. This bill reduces methods available
to manage access to specified medications.
4)Concerns . Health plans, insurers, and pharmacy benefit
managers (PBM) are opposed to this bill. Opponents indicate
requiring coverage for prescriptions without allowing for safe
management in the course of treatment is problematic. Insurers
indicate the use of step therapy and first-fail protocols help
manage medication management and adherence. Pharmacy benefit
managers maintain that implementation of a well-designed step
therapy program ensures that patients receive appropriate
AB 1826
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medications in a cost effective manner, while reducing waste,
error and unnecessary drug use.
5)Other Health Mandates in the Current Session . There are nine
health mandates under legislative consideration this year,
including AB 1826. Other proposed health mandates include:
a) AB 1600 (Beall): mental health parity
b) AB 1825 (De La Torre): maternity services
c) AB 1904 (Villines): out-of-state carriers
d) AB 2587 (Berryhill): benefit mandates
e) SB 220 (Yee): tobacco cessation services
f) SB 890 (Alquist): basic health treatment services
g) SB 961 (Wright): cancer treatment
h) SB 1104 (Cedillo): diabetes related treatment
6)Related Legislation . AB 1104 (Price) in 2009 required health
plans and health insurers to submit written reports about step
therapy each year to the California Department of Managed
Health Care (DMHC) and the California Department of Insurance
(CDI). AB 1104 was held on the Suspense File of this
committee.
Analysis Prepared by : Mary Ader / APPR. / (916) 319-2081