BILL ANALYSIS �
SB 1053
Page 1
SENATE THIRD READING
SB 1053 (Mitchell)
As Amended August 18, 2014
Majority vote
SENATE VOTE :25-11
HEALTH 12-6 APPROPRIATIONS 12-5
-----------------------------------------------------------------
|Ayes:|Pan, Bonilla, Bonta, |Ayes:|Gatto, Bocanegra, |
| |Chesbro, Gomez, Gonzalez, | |Bradford, |
| |Roger Hern�ndez, | |Ian Calderon, Campos, |
| |Lowenthal, Nazarian, | |Eggman, Gomez, Holden, |
| |Ridley-Thomas, Rodriguez, | |Pan, Quirk, |
| |Wieckowski | |Ridley-Thomas, Weber |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Maienschein, Ch�vez, |Nays:|Bigelow, Donnelly, Jones, |
| |Mansoor, Waldron, | |Linder, Wagner |
| |Patterson, Wagner | | |
| | | | |
-----------------------------------------------------------------
SUMMARY : Requires, effective January 1, 2016, most health plans
and insurers to cover a variety of Food and Drug Administration
(FDA)-approved contraceptive drugs, devices, and products for
women, as well as related counseling and follow-up services and
voluntary sterilization procedures. Prohibits cost-sharing,
restrictions, or delays in the provision of covered services,
but allows cost-sharing and utilization management procedures if
a therapeutic equivalent drug or device is offered by the plan
with no cost sharing.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)According to the California Health Benefits Review Program,
annual fiscal impact in the private insurance market as
follows:
a) $65 million in increased premiums for private health
care coverage statewide, including:
i) $37 million in premium costs to private employers.
SB 1053
Page 2
ii) $26 million in premium costs to individuals.
iii) $2 million in premium costs to CalPERS.
b) $216 million in cost savings due to averted deliveries
and abortion services. Assuming these costs savings are
proportionate to increased expenditures:
i) $123 million in savings to private employers.
ii) $86 million in savings to individuals.
iii) $7 million in savings to CalPERS.
2)Estimated Medi-Cal managed care costs of $10 million (10%
General Fund (GF)/90% federal), and projected cost savings of
$56 million (about 45% GF/55% federal) annually after
implementation due to an estimated 6,000 additional
pregnancies averted.
3)Estimated potential increased state costs exceeding $5 million
to pay the costs of this contraceptive coverage on behalf of
enrollees in Covered California.
4)Costs to the Department of Managed Health Care of $300,000 to
verify compliance and clarify coverage requirements via
regulation (Managed Care Fund). Ongoing costs should be
minor, in the range of $50,000 annually (Managed Care Fund).
5)Minor ongoing costs to California Department of Insurance to
oversee compliance, in the range of $50,000 annually
(Insurance Fund).
6)Cost savings are likely to accrue to state and local
governments in a variety of health, social services, and
education programs, including Medi-Cal, due to reduced demand
for these services as a result of over 20,000 fewer unintended
pregnancies statewide. About half of pregnancies end in
delivery. These cost savings are beyond the scope of this
analysis but will be cumulative and are likely to be
significant.
COMMENTS : According to the author, this bill builds on current
SB 1053
Page 3
state and federal law to further California's leadership in
expanding access to birth control by requiring health insurance
carriers to cover the full range of FDA-approved contraception
for women without cost sharing, delays or denial of coverage.
The Patient Protection and Affordable Care Act (ACA) requires
most health insurance carriers to cover all FDA-approved birth
control methods, including sterilization, without out-of-pocket
costs for enrollees. However, lack of clarity in the federal
law has led to inadequate and inconsistent implementation.
Federal regulations permit carriers to employ "reasonable
medical management techniques" but do not define the term or
provide clear guidance about when medical management in the
context of contraceptive coverage can be used. The author
asserts that this flexibility and ambiguity has led to a
patchwork of contraceptive coverage policies throughout the
state that disfavor or create barriers to particular methods,
going against the intent of the ACA contraceptive provision and
depriving women of their reproductive autonomy.
California Family Health council and National Health Law
Program, the cosponsors of the bill, write that this bill would
improve access to a wider range of FDA-approved methods of
contraception for all individuals in California with health
insurance by building on current state and federal law to
require insurance coverage for contraception without
restrictions or cost-sharing. The California Primary Care
Association states that according prevailing standards of care,
a woman's choice in consultation with her health care provider
should be the primary factor in determining her contraceptive
method.
In opposition, the Alliance of Catholic Healthcare states that
this bill contains mandates that are different than the federal
mandate, including in the definition of religious employer, no
accommodation for non-profit religious organizations, and
expanded coverage for contraceptives.
Analysis Prepared by : Dharia McGrew / HEALTH / (916) 319-2097
FN: 0005035
SB 1053
Page 4