BILL ANALYSIS �
AB 171
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Date of Hearing: April 26, 2011
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
AB 171 (Beall) - As Amended: April 6, 2011
SUBJECT : Autism spectrum disorder.
SUMMARY : Requires health plans and health insurers to cover the
screening, diagnosis, and treatment of autism spectrum disorders
(ASDs). Specifically, this bill :
1)Requires health plan contracts and health insurance policies
that provide coverage for hospital, medical, or surgical
expenses, to cover the screening, diagnosis, and medically
necessary treatment of ASDs.
2)Prohibits health plans and health insurers from terminating
coverage, or refusing to deliver, execute, issue, amend,
adjust, or renew coverage, to an enrollee or insured solely
because the individual is diagnosed with, or has received
treatment for, an ASD.
3)Prohibits the medically necessary coverage provided pursuant
to this bill from being subject to any limits regarding age,
number of visits, dollar amounts or to provisions relating to
lifetime maximums, deductibles, copayments, or coinsurance or
other terms or conditions that are less favorable to an
enrollee or insured than those terms and conditions that apply
to physical illness generally under the plan contact or
policy.
4)Makes coverage required pursuant to this bill a health care
service and a covered health care benefit, and prohibits it
from being denied on the basis that the treatment is
habilitative, nonrestorative, educational, academic, or
custodial in nature.
5)Permits health plans and health insurers to request, no more
than once a year, a review of treatment provided to an
enrollee or insured for ASDs, and requires the cost of
obtaining the review to be borne by the plan or insurer.
Exempts inpatient services from this provision.
6)Requires health plans and health insurers to establish and
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maintain an adequate network of qualified autism service
providers with appropriate training and experience in ASDs in
a manner consistent with the coverage required to be provided
under this bill, as specified.
7)Prohibits this bill from being construed to reduce any
obligation to provide services to an enrollee or insured under
an individualized family service plan, an individualized
program plan, a prevention program plan, an individualized
education program, or an individualized service plan.
8)Prohibits this bill from being construed to limit benefits
that are otherwise available to an enrollee under a health
plan or to an insured under a health insurance policy.
9)Specifies that, on and after January 1, 2014, health plans and
health insurance policies offered through the newly created
California Health Benefit Exchange (Exchange) are not required
to cover the benefits in this bill that exceed the essential
health benefits (EHBs) set forth in the federal Patient
Protection and Affordable Care Act (PPACA) and requires the
benefits in this bill that do exceed EHBs to be covered if
offered by plans and policies outside of the Exchange.
10)Defines various terms for purposes of this bill, including
the following:
a) "ASD" means a neurobiological condition that includes
autistic disorder, Asperger's disorder, Rett's disorder,
childhood disintegrative disorder, and pervasive
developmental disorder not otherwise specified;
b) "Behavioral health treatment" means professional
services and treatment programs, including behavioral
intervention therapy, applied behavioral analysis, and
other intensive behavioral programs, that have demonstrated
efficacy to develop, maintain, or restore, to the maximum
extent practicable, the functioning or quality of life of
an individual and that have been demonstrated to treat the
core symptoms associated with ASDs;
c) "Behavioral intervention therapy (BIT)" means the
design, implementation, and evaluation of environmental
modifications, using behavioral stimuli and consequences,
to produce socially significant improvement in behaviors,
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including the use of direct observation, measurement, and
functional analyses of the relationship between environment
and behavior;
d) "Diagnosis of ASDs" means medically necessary
assessment, evaluations, or tests to diagnose whether an
individual has one of the ASDs; and,
e) "Treatment for ASDs" means all of the following care,
including necessary equipment, prescribed or ordered for an
individual diagnosed with one of the ASDs by an
appropriately licensed or certified provider who determines
the care to be medically necessary:
i) Behavioral health treatment;
ii) Pharmacy care;
iii) Psychiatric care;
iv) Psychological care;
v) Therapeutic care; and,
vi) Any care for individuals with autism spectrum
disorders that is demonstrated, based upon best practices
or evidence-based research, to be medically necessary.
11)Exempts dental-only and vision-only health plans or health
insurance policies from the provisions of this bill as
specified.
EXISTING LAW :
1)Enacts, in federal law, the PPACA to, among other things, make
statutory changes affecting the regulation of, and payment
for, certain types of private health insurance. Includes the
definition of EHBs that all qualified health plans must cover,
at a minimum, with some exceptions.
2)Provides that the EHB package in 1) above will be determined
by the federal Department of Health and Human Services (HHS)
Secretary and must include, at a minimum, ambulatory patient
services; emergency services; hospitalizations; mental health
and substance abuse disorder services, including behavioral
health; prescription drugs; and, rehabilitative and
habilitative services and devices, among other things.
3)Establishes the Knox-Keene Health Care Service Plan Act of
1975 (Knox-Keene) to regulate and license health plans and
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specialized health plans by the Department of Managed Health
Care (DMHC) and provides for the regulation of health insurers
by the California Department of Insurance (CDI).
4)Requires every health plan contract or health insurance policy
issued, amended, or renewed on or after July 1, 2000, that
provides hospital, medical, or surgical coverage to provide
coverage for the diagnosis and medically necessary treatment
of severe mental illness (SMI) of a person of any age, and of
serious emotional disturbances of a child, under the same
terms and conditions applied to other medical conditions, as
specified.
5)Establishes the California Legislative Blue Ribbon Commission
on Autism, until November 30, 2008, to study and investigate
the early identification and intervention of ASDs, gaps in
programs and services available to those with ASDs, and to
make recommendations to address gaps in services.
6)Requires the Department of Developmental Services (DDS) to
develop procedures for the diagnosis of ASDs.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . According to the author, this bill is
intended to close real and perceived loopholes in current law
that health plans and insurers exploit to deny essential
treatment to individuals with ASDs. The author maintains
that, by explicitly listing medically necessary health care
services that must be covered for ASDs, this bill clarifies
the existing mental health parity law and eliminates
discrepancies between how DMHC and CDI are interpreting the
law. The author adds that requiring health plans and health
insurers to cover screening, diagnosis, and treatment of ASDs
and to develop and maintain networks of qualified ASD service
providers will force them to bear their fair share of the
responsibility for providing essential and comprehensive
treatment to the families in California impacted by these
conditions. The author states that this bill will ensure
more Californians with autism and related disorders receive
the services they need and save taxpayer dollars by
preventing plans and insurers from continuing to shift their
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costs onto public agencies, such as regional centers, school
districts and counties.
2)ASDs . The developmental disorders known as ASDs include
autism, Asperger's syndrome, Rett's syndrome, childhood
disintegrative disorder, and pervasive developmental disorder
not otherwise specified. ASDs are characterized by three
distinctive types of behavior, which can range from mild to
disabling. The main features of ASDs are impaired social
interaction and communication, an inability to empathize, and
failure to understand social cues. Other characteristics
include repetitive behaviors, such as rocking, twirling, and
head banging; and narrow, obsessive interests. Persons with
ASDs also often have numerous co-occurring conditions,
including behavioral disorders and particular health
problems, such as sleep disorders, gastrointestinal problems,
and immune system deficiencies. The National Institute of
Mental Health (NIMH) estimates that, between two and six per
1,000 children have ASDs and males are three to four times
more likely to have ASDs than females. NIMH states that ASDs
can often be reliably detected at three years of age and in
some cases as early as 18 months. Early diagnosis is crucial
because, although there is no cure for ASDs, evidence
indicates that intensive early intervention in optimal
educational settings for at least two years during the
preschool years results in improved outcomes in most young
children with ASDs. While there is no single best treatment
package for individuals with ASDs, most respond best to
highly structured, specialized programs.
3)CURRENT PARITY LAW . 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 SMIs of a person of any age, and of serious
emotional disturbances of a child, as defined, under the same
terms and conditions applied to other medical conditions.
Nine specific diagnoses are considered SMI: schizophrenia;
schizoaffective disorder; bipolar disorder; major depressive
disorder; panic disorder; obsessive compulsive disorder;
pervasive developmental disorders or autism; anorexia
nervosa; and, bulimia nervosa. For covered conditions,
health plans are required to eliminate benefit limits and
share-of-cost requirements that have traditionally rendered
mental health benefits less comprehensive than physical
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health coverage. Current state law requires mental health
parity (MHP) benefits to include outpatient services,
inpatient hospital services, partial hospital services, and
prescription drugs, if the health plan contract includes
coverage for prescription drugs. Current state regulations
require parity coverage for at least, in addition to all
basic and other health care services required by Knox-Keene,
crisis intervention and stabilization, psychiatric inpatient
services, including voluntary inpatient services, and
services from licensed mental health providers.
The federal Mental Health Parity and Addiction Equity Act
(MHPA) requires group health insurance plans to cover mental
illness, including ASDs, on the same terms and conditions as
other illnesses and helps to end discrimination against those
who seek treatment for mental illness. The MHPA does not
mandate group health plans provide any mental health
coverage. However, if a plan does offer mental health
coverage, then it requires equity in financial requirements,
such as deductibles, co-payments, coinsurance, and
out-of-pocket expenses; equity in treatment limits, such as
caps on the frequency or number of visits, limits on days of
coverage, or other similar limits on the scope and duration
of treatment; and, equality in out-of-network coverage. The
MHPA applies to all group health plans for plan years
beginning after October 3, 2009, and exempts small firms of
50 or fewer employees.
4)INDEPENDENT MEDICAL REVIEW . Individuals covered by health
plans or health insurers in California are entitled to an
independent medical review (IMR) if a health plan or insurer
denies health care services or payment for health care
services based on medical necessity. An IMR is a process
where expert independent medical professionals are selected
to review specific medical decisions made by the plans or
insurers. DMHC and CDI administer the IMR program to enable
consumers to request an impartial appraisal of medical
decisions within certain guidelines specified in law. An IMR
can only be requested if the plan or insurer's decision
involves the medical necessity of a treatment, an
experimental or investigational therapy for certain medical
conditions, or a claims denial for emergency or urgent
medical services.
DMHC maintains an online searchable database that allows
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consumers to review IMR decisions. A search of the IMR
database relating to patients diagnosed with ASDs identified
134 cases, most of which involved minors. Of that amount, 18
of the health plans' original decisions were upheld, due
mainly to a lack of supporting documentation justifying the
requested treatment, and 116 were overturned, due mostly to
sufficient evidence that the requested treatment was
medically necessary. The majority of the IMR requests for
treatment coverage involved speech, occupational, or
behavioral therapy.
5)EHBs . The PPACA requires qualified health plans to cover
specified categories of EHBs, including behavioral health
treatment and rehabilitative services, by 2014. The HHS
Secretary is tasked with defining these benefit categories
through regulation so that they mirror those benefits offered
by a "typical" employer plan. Qualified plans are required
to cover EHBs by 2014. Federal guidance with respect to EHBs
is expected later this year and in 2012.
In a January 2011 issue brief by the University of California's
Health Benefits Review Program (CHBRP) focusing on the
federal requirement to cover EHBs, CHBRP notes that
there is considerable legal ambiguity over how state mandates
requiring the coverage of the treatment for a specific
condition or disease will interact with federal law. CHBRP
states that these mandates often extend across multiple
benefit categories. CHBRP cites, as an example, California's
mandate to cover breast cancer treatment, which implicitly
requires coverage for screening and testing, medically
necessary physician services, ambulatory services,
prescription drugs, hospitalization, and surgery. CHBRP
writes that it is unclear how California benefit mandates
that overlap across several EHB categories would be evaluated
in relation to the EHB package.
6)CHBRP . CHBRP was created in response to AB 1996 (Thomson),
Chapter 795, Statutes of 2002, which requests the University
of California to assess legislation proposing a mandated
benefit or service, and prepare a written analysis with
relevant data on the public health, medical, and economic
impact of proposed health plan and health insurance benefit
mandate legislation. In its analysis of this bill, CHBRP
reports that its review focuses on intensive BIT because this
bill would specifically require coverage for BIT. Among
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CHBRP's findings are the following:
a) Medical Effectiveness . CHBRP writes that the
literature on the effectiveness of BIT for ASDs is
difficult to synthesize since most studies compared
intensive behavioral intervention therapies of differing
duration and intensity or compared interventions based on
different theories of behavior. Thus, most studies of
intensive behavioral intervention therapy cannot answer
the question of whether BIT improves outcomes relative to
no treatment. They can only answer the question of
whether some form of BIT is more effective than others.
CHBRP notes that even this question is difficult to answer
because the characteristics of treatments provided to both
intervention and comparison groups vary widely across
studies. Additionally, CHBRP states that many studies of
BIT do not assess outcomes over sufficiently long periods
of time to determine whether use of these therapies is
associated with long-term benefits.
According to CHBRP, evidence regarding the effectiveness of
prescription drugs for treatment of behavioral symptoms of
ASDs is limited because only a few randomized controlled
trials of these medications have been conducted and most
of these trials had small sample sizes. CHBRP was unable
to identify any studies on the effectiveness of
psychiatric care, psychological care, occupational
therapy, physical therapy, and speech therapy for
treatment of ASDs, meaning that there is insufficient
evidence to determine whether they are effective.
b) Utilization, Cost, and Coverage Impacts . According to
CHBRP, roughly 101,000 enrollees in DMHC-regulated and
CDI-regulated policies subject to this bill are diagnosed
with ASDs. CHBRP notes that, in California, BIT not
covered by health plans or insurers may be purchased by
other payors, including families, charities, DDS, the
California Department of Education (CDE), or other payors.
CHBRP estimates that this bill would affect BIT
utilization in two ways: it would add new users, and,
among newly covered users, it would increase the hours per
week of these therapies. Specifically, this bill would be
expected to result in 400 new users of BIT and would
prompt 10,300 current users to obtain these services
through their insurance. CHBRP estimates that, prior to
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the mandate in this bill, these 10,300 users received
these services paid for by a source other than health
insurance.
According to CHBRP, the percent of enrollees with health
insurance that would be subject to this bill with benefit
coverage for ASD-relevant BIT, durable medical equipment
(DME), and prescription drugs would increase approximately
100%. The number of enrollees covered for BIT would
increase from about four million to 22 million; the number
covered for DME would increase from 21 million to 22
million, and the number covered for prescription drugs
would increase from 21 million to 22 million. CHBRP
estimates no measurable change in benefit coverage for
enrollees with health insurance subject to this bill for
ASD-relevant speech, physical, and occupational therapy or
psychological and psychiatric care.
This bill is estimated to increase total expenditures by
roughly $138 million for plans and policies subject to
this bill. This increase in expenditures results from a
$338 million increase in health insurance premiums; a $17
million increase in out-of-pocket expenses for enrollees
with ASDs with newly covered benefits; and, a $218 million
decrease in expenses for noncovered benefits. The impact
of this bill on per member, per month (PMPM) premiums
varies by market segment. In the privately funded
large-group market, premiums are estimated to increase by
an average of $0.80 PMPM among CDI-regulated policies and
$1.00 PMPM among DMHC-regulated plan contracts. For
enrollees with privately funded small-group insurance
policies, premiums are estimated to increase by an average
of $0.50 PMPM for CDI-regulated policies and $1.00 PMPM
for DMHC-regulated plan contracts. In the privately
funded individual market, premiums are estimated to
increase by an average of $0.30 PMPM and by $0.60 PMPM in
CDI- and DMHC-regulated markets, respectively. Among
publicly funded DMHC-regulated health plans, CHBRP
estimates an impact on premiums of $1.11 PMPM for CalPERS,
$2.70 PMPM for Medi-Cal Managed Care Plans for persons
under age 65, and nearly $4.00 PMPM for Managed Risk
Medical Insurance Board plans.
c) Public Health Impact . CHBRP estimates that this bill
would increase benefit coverage for prescription drugs,
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DME, and BIT for enrollees with ASDs. CHBRP reports that
there is a preponderance of evidence to suggest some
effectiveness of prescription drugs and BIT.
Additionally, CHBRP states that the impact of this bill on
reducing possible gender, racial, or ethnic disparities of
symptoms associated with ASDs and on reducing premature
death for the ASDs population is unknown. Lastly, CHBRP
estimates that, as a result of this bill, the net decrease
in noncovered benefit expenses for the estimated 10,700
newly covered enrollees with ASDs who use BIT is about
$218 million. The extent of the reduction in financial
burden for enrollees with ASDs and their families is
unknown, as some portion of the financial shift may be
from charities, DDS, CDE, or other payors. The majority
of these savings, about $216 million, would be
attributable to use of BIT.
7)SUPPORT . The sponsor, the Alliance of California Autism
Organizations, which represents over 40 local, state, and
nationally affiliated parent founded and supported autism
organizations, states that this bill will ensure more
Californians with autism and related disorders receive the
services they need and save taxpayer dollars by preventing
plans and insurers from continuing to shift their costs onto
public agencies, such as regional centers, school districts
and counties. Autism Speaks writes that is it proud to
support this bill to ensure that children diagnosed with ASDs
receive medically necessary treatments to improve their
quality of life and functional independence, which is
consistent with the intent and spirit of the state's existing
mental health parity law. American Association of University
Women California writes in support that this bill is
extremely important to families and their children with ASDs
because these conditions are seldom covered and this bill
will ensure that families with affected children are no
longer faced with huge out of pocket costs for medical
services, various recommended therapies, and behavioral
health services. The State Council on Developmental
Disabilities (SCDD) writes that many families have reported
that private insurers will not cover services associated with
their child's diagnosis of ASDs, including applied behavioral
analysis, which research has determined to be effective in
the treatment of ASDs. SCDD states that this bill may
potentially enable many families with affected children to
receive the treatment they need from their insurance
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providers without engaging in costly appeals or litigation.
8)OPPOSITION . The California Association of Health Plans (CAHP)
objects to all benefit mandate bills, stating that it is the
wrong time for the Legislature to consider enacting new
benefit mandates since, starting in 2014, many Californians
can enroll in health coverage through the newly created
insurance Exchange established under the PPACA and, in
California, through AB 1602 (John A. P�rez), Chapter 655,
Statutes of 2010. CAHP asserts that, because the PPACA
requires the cost of any additional benefits required by state
law that exceed the EHBs to be borne by the states, this will
have a harmful effect on California's budget by requiring the
state to pay for any additional mandates that do not match the
federal EHBs. The Association of California Life & Health
Insurance Companies opposes all mandate bills because they
would prove counterproductive to industry efforts to make
health insurance more affordable and available and could have
real impacts both on individuals struggling to maintain
coverage and on the State budget. America's Health Insurance
Plans maintains that consumers select coverage options based
on the elements that they consider desirable and argues that
benefit mandates eliminate the ability of health insurers and
HMOs to provide unique benefit packages in response to the
needs of consumers by requiring individuals and consumers to
purchase benefits prescribed by the Legislature, not driven by
consumer choice.
9)RELATED LEGISLATION .
a) SB 166 (Steinberg) requires health plans and health
insurers to cover BIT, as defined, for pervasive
developmental disorder or autism. SB 166 is pending in the
Senate Health Committee.
b) AB 154 (Beall) requires health plans and health insurers
to cover the diagnosis and medically necessary treatment of
a mental illness, as defined, of a person of any age,
including a child, with specified exceptions, and not
limited to coverage for severe mental illness as in
existing law. AB 154 is pending in the Assembly
Appropriations Committee.
10)PRIOR LEGISLATION .
a) SB 1563 (Perata) of 2008 would have directed DMHC and
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CDI to establish the Autism Workgroup for Equitable Health
Insurance Coverage to examine coverage of services related
to ASDs and make recommendations on ensuring that health
plans and insurers provide appropriate and equitable
coverage for ASDs. SB 1563 was vetoed by the governor.
b) SB 1364 (Cedillo) of 2008 would have required the
Department of Public Health (DPH) to establish the ASDs
Advisory Council to recommend ways in which DPH may deal
more effectively with ASDs, and would have required DPH to
create a pilot project to provide a voluntary registry of
persons with ASDs. SB 1364 died on the Assembly
Appropriations Committee Suspense File.
c) SB 527 (Steinberg) of 2007 would have required DDS to
work with one or more regional centers and an advisory
committee to establish the ASDs Early Screening,
Intervention, and Pilot Program to improve services for
children with ASDs. SB 527 was vetoed by the governor.
d) AB 1478 (Frommer) of 2006 would have required DDS, in
consultation with specified state departments, to develop
guidelines for the treatment of ASDs and to disseminate the
information to parents. AB 1478 was vetoed by the
governor.
e) SCR 51 (Perata), Resolution Chapter 124, Statutes of
2005, and SCR 55 (Perata), Resolution Chapter 127, Statutes
of 2007, establishes and extends until November 30, 2008,
the authorization for the Legislative Blue Ribbon
Commission on Autism.
f) AB 430 (Cardenas), Chapter 171, Statutes of 2001, an
omnibus health budget trailer bill, requires, among other
things, DDS to develop and publish procedures for the
diagnosis of ASDs for use by clinical staff at regional
centers.
g) AB 88 requires a health plan or insurer to provide
coverage for severe mental illnesses, and for the serious
emotional disturbances of a child, including PDD.
11)POLICY COMMENTS .
a) Need for Bill . This bill is one of several health
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mandates introduced for legislative consideration this
year. The author may wish to address the extent to which
the need for this bill and others similar to it is
premature, given that federal regulations to define the
parameters of the EHB package have yet to be promulgated.
b) Lookalike Products . This bill specifies that health
plans and policies offered through the newly created
Exchange would not be required to cover the benefits in
this bill that exceed EHBs but requires those specific
benefits to be covered if offered by plans and policies
operating outside the Exchange. The author may wish to
address the extent to which this provision conflicts with
current state law pursuant to AB 1602 requiring plans and
policies offering products in the Exchange to offer the
same products outside the Exchange.
12)AUTHOR'S AMENDMENTS . The author intends to offer the
following amendments in committee to clarify the definition
and responsibilities of a qualified autism services provider:
"Qualified autism service provider" shall include any nationally
or state licensed or certified person, entity, or group that
designs, supervises, or provides treatment of ASDs and the
unlicensed personnel supervised by the licensed or certified
person, entity, or group, provided the services are within the
experience and scope of practice of the licensed or certified
person, entity, or group. Qualified autism service provider
shall also include any service provider that is vendorized by
a regional center to provide services under Division 4.5 of
the Welfare and Institutions Code or Title 14 of the
Government Code, or a California Department of Education
nonpublic, nonsectarian agency as defined in Section 56035 of
the Education Code approved to provide those same services for
autism spectrum disorders and the unlicensed personnel
supervised by such provider. A qualified autism service
provider shall assure criminal background screening and
fingerprinting, and adequate training and supervision of all
personnel utilized to implement services. Any national
license or certification recognized by this section shall be
accredited by the National Commission for Certifying Agencies.
REGISTERED SUPPORT / OPPOSITION :
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Support
Alliance of California Autism Organizations (sponsor)
Alameda County Developmental Disabilities Council
American Association of University Women California
Area 4 Board, State Council of Developmental Disabilities
Area 10 Board, State Council of Developmental Disabilities
Association of Regional Center Agencies
Autism Deserves Equal Coverage
Autism Speaks
California Association of Marriage and Family Therapists
California Association of School Psychologists
California Communities United Institute
California Primary Care Association
California School Boards Association
Contra Costa Health Services
Developmental Disabilities Area Board 10, State of California
People's Care
San Francisco Unified School District
Solano County Families for Effective Autism Treatment
State Council on Developmental Disabilities
The Arc of California
Several individuals
Opposition
America's Health Insurance Plans
Association of California Life & Health Insurance Companies
California Association of Health Plans
California Chamber of Commerce
Analysis Prepared by : Cassie Royce / HEALTH / (916) 319-2097