BILL ANALYSIS
SENATE HEALTH
COMMITTEE ANALYSIS
Senator Elaine K. Alquist, Chair
BILL NO: SB 296
S
AUTHOR: Lowenthal
B
AMENDED: April 13, 2009
HEARING DATE: April 22, 2009
2
CONSULTANT:
9
Tadeo/
6
SUBJECT
Mental health services
SUMMARY
Requires health plans, including specialized health plans,
and insurers that offer professional mental health services
to direct those services to be provided in a coordinated
manner, establish websites that contain particular
information, and provide benefit cards, as specified.
CHANGES TO EXISTING LAW
Existing law:
Existing law provides for the regulation of health care
service plans (health plans) by DMHC and regulation of
disability insurers who sell health insurance (health
insurers) by the California Department of Insurance (CDI).
Existing law requires full service health plans licensed by
DMHC to provide basic health care services, as defined.
Existing law requires health care service plans and health
insurers to comply with certain administrative
requirements, premium requirements, patient protection
requirements, fiduciary and financial requirements,
provider access requirements, and to provide certain
mandated benefits to enrollees.
Continued---
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 2
Existing law requires health plans and health insurers to
provide coverage for the diagnosis and medically necessary
treatment of certain severe mental illnesses (SMI), as
defined, and of serious emotional disturbances (SED) of a
child, as defined, under the same terms and conditions
applied to other medical conditions.
Existing law requires websites of health plans that provide
coverage for professional mental health services to
include, but not be limited to, providing information for
subscribers, enrollees, and providers on accessing mental
health services.
This bill:
Requires health plans, including specialized health plans
and insurers that offer professional mental health
services, to direct those services to be provided in a
manner that ensures coordination of benefits between mental
health care providers and general physical health care
providers.
On or before January 1, 2012,requires health plans and
insures that offer professional mental health services,
including a specialized health care service plan, to
establish a website that includes or provides a link to
information on:
Plan and insurer policies and procedures related to
modified contracts or coverage; enrollee or policy
contract benefits and terms; economic profiling;
utilization review and modified coverage; cancellation
of contracts; lists of providers; enrollee and
subscriber, or policyholder and insured, grievances;
continuity of care; and independent medical review.
All provider manuals, policies, and procedures
related to the terms and conditions of provider
contracts, including any material changes to those
manuals, policies and procedures.
Additionally, requires each health plan website to include
the DMHC's final report of the plan's periodic review, and
each insurer website to include the results of any market
conduct examinations of the insurer.
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 3
Requires this material to be updated at least every month.
Requires DMHC to include a link to each plan's website on
the DMHC website. Requires the commissioner to include a
link to each health insurer's website on the CDI website.
Requires health plans, including specialized health care
plans, and insurers that offer professional mental health
services, to issue a benefits card to each enrollee and
insured for assistance with mental health benefits coverage
information, in-network provider access information, and
claims processing purposes. Requires the card, at a
minimum to include:
The benefit administrator or health plan or insurer
issuing the card,
The enrollee or insured's identification number or
The subscriber or policyholder's identification
number when the enrollee or insured is a dependent who
accesses services using the subscriber or
policyholder's identification number
A telephone number that enrollees or insured's may
call 24 hours a day, 7 days a week, for assistance
regarding health benefits coverage information,
in-network provider access information, and claims
processing
A brief statement indicating that enrollees and
insured's may call the telephone number for assistance
regarding mental health services and coverage and,
The plan or health insurer's website address.
Provides that a health plan or insurer shall not print any
information that may result in fraudulent use of the card,
or any information that is otherwise prohibited from being
included on the card.
On and after July 1, 2011, requires the benefits card to be
issued by a health plan or insurer to an enrollee or
insured upon commencement of coverage, or upon any change
in the enrollee's or insured's coverage that impacts the
data content or format of the card.
Provides that a health plan or insurer is not required to
issue a separate benefits card for mental health coverage
if the health plan or insurer issues a card for health care
coverage in general, and the card provides the information
required by this section.
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 4
FISCAL IMPACT
Unknown.
BACKGROUND AND DISCUSSION
The author states that over the last decade, California has
been faced with an increasing health care crisis riddled
with unbalanced and unregulated plan policies and
procedures that negatively impact patients' access to
health care, specifically mental health care.
The author further states that mental health benefits are
denied to insured consumers every day. The author adds
that consumers are led into complicated telephone trees
with long wait times, given outdated lists of providers to
choose from, and are asked to retroactively pay for
services they thought were covered in their plan. The
author contends that this bill would direct services to be
provided in a manner that ensures coordination between
mental health providers and physical care providers in an
attempt to help the 25 million Californians enrolled in
health care plans access the necessary mental health
benefits they pay for.
California's Health Care Standards under the Knox-Keene Act
of 1975
California has two regulatory agencies, DMHC and CDI, which
have oversight over roughly 200 health care service plans
and health insurers, which collectively provide coverage
for 27 million people. DMHC enforces the provisions of the
Knox-Keene Health Care Service Plan Act, which sets rules
for mandatory basic services and other specific health care
benefits and services; financial stability; availability
and accessibility of providers; review of provider
contracts; cost sharing; on-site medical surveys, including
review of patient medical records; and consumer disclosure
and grievance requirements.
Mental health parity
In 1999, the Legislature passed and the Governor signed AB
88 (Thomson), Chapter 534, Statutes of 1999, requiring
health plans and health insurers to provide coverage for
the diagnosis and medically necessary treatment of certain
types of severe mental illnesses (SMI) of a person of any
age, and of serious emotional disturbances (SED) of a
child, as defined, under the same terms and conditions
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 5
applied to other medical conditions.
Specifically, the statute defines SMI as including
schizophrenia, schizoaffective disorder, bipolar disorder,
major depressive disorders, panic disorder,
obsessive-compulsive disorder, pervasive developmental
disorder or autism, anorexia nervosa, and bulimia nervosa.
The statute defines a child with an SED as one who has one
or more mental disorders identified in the most recent
edition of the Diagnostic and Statistical Manual of Mental
Disorders, other than a primary substance use disorder or
developmental disorder, which results in behavior that is
inappropriate to the child's age, according to expected
developmental norms.
For covered conditions, the mental health parity statute
requires benefits to include outpatient and inpatient
services, hospital services, and prescription drugs, if a
plan contract or insurance policy otherwise covers
prescription drugs, and requires terms for maximum lifetime
benefits, copayments, and deductibles to be applied equally
to all benefits under a plan contract or insurance policy.
Existing regulations specify that, in addition to all basic
and other health care services required by the Knox-Keene
Act, mental health parity provides, at a minimum, for the
coverage of crisis intervention and stabilization,
psychiatric inpatient services, including voluntary
inpatient services, and services from licensed mental
health providers including, but not limited to,
psychiatrists and psychologists. The regulations also
require that a plan's referral system shall provide "timely
access and ready referral in a manner consistent with good
professional practice."
Since the parity law was passed, several reports have
evaluated the law's implementation. In March, 2005, the
Department of Mental Health issued its report, "Mental
Health Parity-Barriers and Recommendations," noting "there
are a number of barriers at the operational level that keep
California from achieving mental health parity. The largest
barrier to full implementation is lack of access. Confusion
remains about what parity actually means beyond the fiscal
and structural requirements. Covered diagnoses are clear,
but what array of services is covered for individuals with
these diagnoses, and for how long, remains inconsistent
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 6
from plan to plan. It remains unclear what services are
the responsibility of health plans versus the
responsibility of public agencies and organizations."
In March 2007, DMHC issued a report, "Mental Health Parity
in California; Mental Health Parity Focused Survey Project:
A Summary of Survey Findings and Observations," based on a
"focus survey" it had conducted in 2005 of seven large
health plans, covering 85 percent of the commercial managed
care population and representing all delivery models of
mental health services. DMHC found that the most common
problems were payment of emergency room claims, plans'
monitoring of access to after-hours services to ensure
timely response to enrollees', and plans' explanations in
letters denying treatment requests, DMHC also found
significant concerns on the part of consumer and industry
stakeholders about perceived limitations on, and lack of
coordination of, care for children with autism and other
pervasive developmental disturbances.
In March 2007, DMHC contracted with an outside consulting
firm to study the issue of access to mental health
services, selecting two plans and the availability of
services in four counties (Sacramento, Los Angeles, Orange,
and San Francisco), for study. The study found that the
percentage of providers accepting new patients varied
roughly between 71 percent and 80 percent. Despite this
level of availability, the study documented that the
percentage of providers who did not treat specific parity
diagnoses was high. For example, in San Francisco, 74
percent of providers in all specialties did not treat
schizophrenia. In Sacramento, that figure increased to 76
percent and in Los Angeles, it was 71 percent. The lack of
providers treating pervasive developmental disorder or
autism or serious emotional disturbances of a child was
also notable, with 80 to 90 percent of all providers and
all psychiatrists not treating these disorders in San
Francisco, with only slightly better availability in
Orange, Los Angeles, and Sacramento Counties.
In a separate report published in September 2007 by the
California Legislative Blue Ribbon Commission on Autism,
the Commission found that coverage of health care,
behavioral, and psychotherapeutic services for autism
spectrum disorders is limited, inconsistent, or excluded
altogether by private health plans and insurers, and that,
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 7
when health plans and insurers contract for behavioral
health service, there is often fragmentation and/or denial
of services, leaving families with lost time and no
services. The report also found that health plans and
insurers do not consistently provide access to
professionals with adequate training and expertise in
autism spectrum disorders, and that roles and
responsibilities of health plans and insurers for autism
spectrum disorder services are not well defined.
On March 27, 2008, the Senate Health Committee held an
informational hearing to review implementation by the DMHC
of consumer protection laws, as well as provisions of the
Knox-Keene Act that apply to emerging consumer protection
issues. The committee heard testimony from health care
consumers, providers, and plans on mental health parity and
timely access to care, which supported many of the findings
in the previously published reports.
Prior legislation
SB 1553 (Lowenthal) Chapter 722, Statutes of 2008 requires
the websites of health plans that provide coverage for
professional mental health services to include, but not be
limited to, providing information for subscribers,
enrollees, and providers on accessing mental health
services.
AB 1887 (Beall) of 2008 would have expanded the mental
health parity coverage requirement for certain health care
service plan contracts and health insurance policies
issued, amended, or renewed on or after January 1, 2009, to
include the diagnosis and treatment of a mental illness of
a person of any age and would have defined mental illness
for this purpose as a mental disorder as defined in the
Diagnostic and Statistical Manual IV. Vetoed by the
Governor.
AB 423 (Beall) of 2007 would have required a health care
service plan contract and health insurance policy issued,
amended, or renewed on or after January 1, 2008, that
provides hospital, medical, or surgical coverage, to
provide coverage for the diagnosis and medically necessary
treatment of a mental illness of a person of any age,
including a child, and would have defined mental illness as
a mental disorder as defined in the Diagnostic and
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 8
Statistical Manual IV. Vetoed by the Governor.
AB 2179 (Cohn), Chapter 797, Statutes of 2002, requires the
DMHC to develop and adopt regulations to ensure that
enrollees have access to needed health care services in a
timely manner. The bill requires DMHC to develop
indicators of timeliness of access to care and specifies
three indicators for the department to consider.
AB 88 (Thomson), Chapter 534, Statutes of 1999, requires
health plans and health insurers to provide coverage for
the diagnosis and medically necessary treatment of certain
severe mental illnesses, as defined, and of serious
emotional disturbances of a child, as defined, under the
same terms and conditions applied to other medical
conditions.
Arguments in support
The California Psychiatric Association (CPA), the sponsor
of SB 296, states that the changes suggested by this bill
can be valuable to the patient and increase their access to
information and services. CPA argues that requiring a
specific number on a benefits card related to mental health
services can help avoid situations in which the complexity
of phone trees and call transfers between different
corporate entities cause consumers to simply hang up and
forego access to information and/or services.
Arguments in opposition
The California Association of Health Plans (CAHP) states
that this bill would require extensive website disclosure
by plans, increase administrative costs for health plans
and would not provide meaningful information to enrollees.
CAHP states that it is unclear how this information will
help consumers or be in a format that is easily
understandable.
COMMENTS
1. Some of the information that the bill seeks to make
available on the website is already available through other
means. For example, policies and procedures, and a
description of the process by which an insurer, or an
entity with which an insurer contracts for utilization
review or utilization management functions, reviews and
approves, modifies, delays, or denies requests by providers
STAFF ANALYSIS OF SENATE BILL SB 296 (Lowenthal)Page 9
prior to, retrospectively, or concurrent with the provision
of health care services to insureds, are required to be
filed with the commissioner, and are required to be
disclosed by the insurer to insureds and providers upon
request, and by the insurer to the public upon request.
In addition, the director of DMHC, as a general rule, is
required to publish or make available for public inspection
any information filed with or obtained by the department,
unless the director finds that this availability or
publication is contrary to law.
The author's intent with SB 296 is to make information
about plans and insurers contracts, procedures, and
providers more readily available.
2. Scope of information to be provided on the website is
unclear.
The author might wish to specify whether the information to
be posted would be for mental health services specifically
or all health services provided by the plan or insurer.
POSITIONS
Support: California Psychiatric Association (sponsor)
California Association of Marriage and
Family Therapists
Oppose: California Association of Health Plans