BILL ANALYSIS �
AB 1636
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Date of Hearing: April 18, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 1636 (Monning) - As Introduced: February 9, 2012
Policy Committee: HealthVote:13-5
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill requires the Department of Managed Health Care (DMHC),
in collaboration with other state departments, to convene a
special committee to review and evaluate health and wellness
incentive and rewards programs offered by health care service
plans, health insurers, and employers. Specifically, this bill
requires the committee to:
1)Evaluate a variety of health promotion and wellness programs,
including those that offer or require health risk appraisals,
screening services, smoking cessation, health premium
reductions, and other incentives.
2)Evaluate programs for effectiveness based upon scientific
evidence and the extent to which they may result in
discrimination.
3)Meet publicly no later than March 30, 2013, and engage experts
and stakeholders in deliberations.
FISCAL EFFECT
Depending upon the makeup of the committee, the depth and
scientific rigor of the evaluation performed, and the extent and
type of stakeholder engagement, costs could range from $50,000
at the low end to over $200,000 annually (Managed Care Fund).
COMMENTS
1)Rationale . According to the author, this bill has been
introduced to advance a public policy conversation in
California about the evidence base for wellness incentive
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programs. Wellness incentive programs can be controversial,
and prevention advocates have opposing perspectives. Some
believe that wellness incentive programs can be instrumental
in controlling the rise of chronic health conditions and their
related costs, while others fear these programs are a
subterfuge for discrimination based on health status. There
are also worries among some that employers will hold employees
and their families accountable for unreasonable health metrics
without meaningful support. Additionally, a fairness concern
exists for some individuals who may have difficulty making the
lifestyle changes necessary to achieve certain metrics due to
genetics or environmental factors.
2)Wellness Incentive Programs . Wellness programs can take many
different forms. Worksite wellness programs such on-site flu
shots or exercise promotion programs appear to be largely
noncontroversial and are not formally regulated. Wellness
programs offered by employers or health plans that include
financial penalties or incentives can be more controversial.
These types of programs are generally either
participation-based (for example, an incentive payment is
earned for filling out a health questionnaire) or
attainment-based (where incentives are earned based on
attainment of health goals, such as body mass index,
cholesterol, blood glucose or blood pressure levels).
Attainment-based incentives must meet certain standards by
federal regulation, including limitations on the size of the
incentive or penalty relative to premiums.
Recent changes enacted in the federal Patient Protection and
Affordable Care Act (ACA) allow employers to link greater
financial incentives to the attainment of health goals.
Because the ACA also contains insurance reform provisions that
prohibit basing premiums on health status beginning in 2014,
health advocates are concerned that allowing premium levels to
be tied to attainment of health metrics provides a back-door
way to charge individuals higher premiums based on poor health
status. On the other hand, employee groups and health plans
are wary of any measure that would stifle innovative
approaches to promoting among their employees and enrollees
health and reducing health care costs.
Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081
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