BILL ANALYSIS �
AB 171
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ASSEMBLY THIRD READING
AB 171 (Beall)
As Amended January 23, 2012
Majority vote
HEALTH 12-6 APPROPRIATIONS 12-5
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|Ayes:|Monning, Ammiano, Atkins, |Ayes:|Fuentes, Blumenfield, |
| |Bonilla, Eng, Hayashi, | |Bradford, Charles |
| |Roger Hern�ndez, Bonnie | |Calderon, Campos, |
| |Lowenthal, Mitchell, Pan, | |Chesbro, Gatto, Hall, |
| |V. Manuel P�rez, Williams | |Hill, Ammiano, Mitchell, |
| | | |Solorio |
|-----+--------------------------+-----+--------------------------|
|Nays:|Logue, Garrick, Mansoor, |Nays:|Harkey, Donnelly, |
| |Nestande, Silva, Smyth | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Requires health plans and health insurers to cover the
screening, diagnosis, and treatment of pervasive developmental
disorder or autism (PDD/A). 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 PDD/A.
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, PDD/A.
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
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service and a covered health care benefit, and prohibits it
from being denied on the basis of the location of delivery of
the treatment or 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 PDD/A, 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
maintain an adequate network of service providers with
appropriate training and experience in PDD/A 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 or exclude
benefits that are otherwise available to an enrollee under a
health plan or to an insured under a health insurance policy,
as specified.
9)Prohibits this bill from being construed to mean that the
services required to be covered under this bill are not
required to be covered under other provisions of existing law.
10)Clarifies that this bill must not be construed as affecting
litigation that is pending on January 1, 2012.
11)Specifies that, on and after January 1, 2014, this bill does
not require any benefits to be provided that exceed the
essential health benefits (EHBs) that all health plans will be
required by federal regulations to provide under the federal
Patient Protection and Affordable Care Act (PPACA).
12)Defines various terms for purposes of this bill, including
the following:
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a) "Diagnosis of PDD/A" means medically necessary
assessment, evaluations, or tests to diagnose whether an
individual has one of the PDD/A; and,
b) "Treatment for PDD/A" means all of the following care,
including necessary equipment that develops, maintains, or
restores to the maximum extent practicable the functioning
or quality of life of an individual with PDD/A and is
prescribed or ordered for an individual diagnosed with one
of the PDD/A by a licensed physician or surgeon or a
licensed psychologist who determines the care to be
medically necessary:
i) Pharmacy care, if the plan contract or policy
includes coverage for prescription drugs;
ii) Psychiatric care;
iii) Psychological care; and,
iv) Therapeutic care.
13)Clarifies that treatment for PDD/A in 12 b) above does not
include behavioral health treatment as defined in existing
law.
14)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 individual states 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,
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among other things.
3)Establishes the Knox-Keene Health Care Service Plan Act of
1975 (Knox-Keene) to regulate and license health plans and
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 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)Requires every health care service plan contract or health
insurance policy that provides hospital, medical, or surgical
coverage to provide coverage for behavioral health treatment
for PDD/A no later than July 1, 2012.
6)Defines "behavioral health treatment" to mean professional
services and treatment programs, including applied behavior
analysis and evidence-based behavior intervention programs,
that develop or restore, to the maximum extent practicable,
the functioning of an individual with PDD/A and that meet
specified criteria, including that the treatment is prescribed
by a licensed physician and surgeon, or developed by a
licensed psychologist, as specified, and provided under a
treatment plan prescribed by a qualified autism service
provider, as specified.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, negligible fiscal impact to the state, and to health
plans and insurers. The California Health Benefits Review
Program (CHBRP) did not identify increased premiums associated
with this bill's requirement to cover therapy, mental health,
and durable medical equipment services.
COMMENTS : According to the author, this bill is intended to
confirm existing law and close perceived loopholes that health
plans and insurers exploit to deny essential treatment to
individuals with PDD/A. The author maintains that, by
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explicitly listing medically necessary health care services that
must be covered for PDD/A, this bill confirms the coverage in
the existing mental health parity law and basic health care
service requirements and will significantly reduce the need for
the DMHC and CDI to overturn continually erroneous coverage
denials by plans and insurers. The author points out that
requiring health plans and health insurers to cover screening,
diagnosis, and treatment of PDD/A and to develop and maintain
networks of qualified PDD/A 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 adds that
this bill is intended to complete the end of insurance
discrimination against individuals with PDD/A that was started
in 2011 with the enactment of SB 946 (Steinberg), Chapter 650,
Statutes of 2011, which dealt with behavioral health treatment
by addressing screening diagnosis and the remaining essential
medical treatments for PDD/A, such as speech, physical and
occupational therapy, which are routinely denied despite clear
coverage requirements in existing law.
In 2011, the Legislature passed and the Governor signed SB 946
(Steinberg), Chapter 650, Statutes of 2011, requiring health
plans and health insurers to provide coverage for behavioral
health treatment for PDD/A from July 1, 2012, through July 1,
2014, in a manner that is consistent with existing state mental
health parity law. Current state law requires mental health
parity benefits to include outpatient services, inpatient
hospital services, partial hospital services, and prescription
drugs, if the health plan contract includes coverage for
prescription drugs.
In its analysis of a prior version of this bill, CHBRP found
that evidence regarding the effectiveness of prescription drugs
for treatment of behavioral symptoms of PDD/A 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 PDD/A, meaning that there is insufficient evidence
to determine whether they are effective. Additionally, CHBRP
estimated no measurable change in benefit coverage for
enrollees with health insurance subject to this bill for
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PDD/A-relevant speech, physical, and occupational therapy or
psychological and psychiatric care.
On December 16, 2011, the federal Center for Consumer
Information and Insurance Oversight (CCIIO) issued a bulletin
proposing that EHBs be defined using a benchmark approach.
Under the CCIIO intended approach, states would have the
flexibility to select a benchmark plan that reflects the scope
of services offered by a "typical employer plan." This approach
would give states the flexibility to select a plan that would
best meet the needs of their residents. In accordance with the
bulletin, the benchmark options include:
1)One of the three largest small group plans in the state by
enrollment.
2)One of the three largest state employee health plans by
enrollment.
3)One of the three largest federal employee health plan options
by enrollment.
4)The largest HMO plan offered in the state's commercial market
by enrollment.
The benefits and services included in the benchmark plan
selected by the state would be the EHB package.
To meet the EHB coverage standard, a health plan or health
insurer would offer benefits that are "substantially equal" to
the benchmark plan selected by the state and modified as
necessary to reflect the 10 coverage categories. The bulletin
indicates that states must select their benchmark plan in the
third quarter two years prior to the coverage year (by September
2012). The PPACA requires states to defray the cost of any
benefits required by state law to be covered by health plans and
health insurers beyond the EHBs. The federal bulletin implies
that existing state mandates could be incorporated in EHBs to
the extent they are included in a benchmark plan existing in
2012. However, the federal rules are not final or entirely
clear on this point. Comments on the federal bulletin are due
by January 31, 2012. Further evaluation of individual state
mandates pending this year will need to be considered in the
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context of a broader discussion about California's benchmark
plan.
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 PDD/A receive medically necessary treatments to
improve their quality of life and functional independence,
consistent with the intent and spirit of the state's existing
mental health parity law.
Health plans and health insurers object to all benefit mandate
bills, stating that 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 health plans to provide
unique benefit packages aimed at the needs of consumers by
requiring individuals and employers to purchase benefits
prescribed by the Legislature, not driven by consumer choice.
Analysis Prepared by : Cassie Royce / HEALTH / (916) 319-2097
FN: 0003070