CDCAN REPORT #019-2011: Assemblymember Beall proposes sweeping private health insurance reforms to require coverage of critical services

SACRAMENTO, CALIF  (CDCAN) [Updated 01/20/2011  08:55 PM  (Pacific Time)]   -  Legislation that could have major impacting in reducing State general fund costs in developmental and other services by requiring private health insurers to pay for critical services for children and adults with autism spectrum and related disorders was introduced today by Assemblymember Jim Beall, Jr. (Democrat – San Jose) [photo left]

The issue has been the focus of intense advocacy by many families of children with autism spectrum disorders, including a Bay Area mother, Feda Almaliti, who fought a long and ultimately successful battle against her managed care plan to provide services to her son with autism spectrum disorders.

In introducing his bill today, Beall said he stands with "…the thousands of California parents and their children with autism spectrum and related disorders in the fight for justice to insure that California's HMO's [health maintence organizations] and other private insurers bear their fair share of the responsibility of providing essential services to those impacted by these conditions.’’

The legislation,. AB 171,  is sponsored by the Alliance of California Autism Organizations (ACAO) which is comprised of over 40 California parent founded and supported local, state, and nationally based autism advocacy and support organizations and their local chapters.

SUMMARY OF WHAT AB 171 WOULD DO:

As introduced today, AB 171 would make the following changes in State law:

• Require health plans to cover screening, diagnosis and treatment of autism spectrum disorders.
• Require health plans to develop and maintain networks of qualified autism service providers.
• Prohibit health plans from denying essential treatments to individuals with autism spectrum and related disorders.

Beall says his bill intends to “leave the practice of medicine to doctors instead of insurance companies.”

Last year Senate President Pro Tem Darrell Steinberg (Democrat – Sacramento) pushed legislation, SB 1283, that focused on health insurance grievances that touched on a part of the larger issue of health insurance plans and children with autism spectrum disorders and their families, focusing on the handling of grievances against a health plan.

That bill was passed by the Assembly and State Senate by was vetoed on September 30, 2010 by Governor Arnold Schwarzenegger, who said the bill was “overbroad in its application and would affect all of the Department's grievance procedures” and was not necessary.

Advocates – and Beall – are hopeful that Brown – a Democrat – is more likely to embrace health insurance reforms as proposed in AB 171, especially given the assertion that those reforms would mean significant savings to the State general fund.

Issue Has Major Impact on State Budget Crisis and Spending Cuts To Developmental Services

• The controversy regarding private health insurance plans and children with autism spectrum disorders and their families and what the health plans should cover has major potential impact on the State budget. 
• Many advocates for families with children with autism spectrum disorders claim that the State could save tens of millions of dollars if insurance companies covered many of the services currently paid for by the State. Some advocates claim the savings could be well over $200 million in State general funds – savings that could off-set cuts in actual spending in the developmental services budget.   
• Those advocates also claim that private health insurance companies should have been required to provide certain intervention services for children with autism spectrum disorders, which could have prevented the need for more expensive services that the State is paying for now and in future years. 
• Private health insurance companies have previously have strongly disagreed with the assertions made by advocates and are likely to mount a major campaign to oppose the bill, including during the hearings in the coming months (likely in late March or April). 

"We cannot continue to expect taxpayers to exclusively foot the bill for vital health care services and programs such as Applied Behavior Analysis (ABA), Speech Therapy, Occupational Therapy and other essential medical and mental health services for children and adults with autism spectrum and related disorders.

 "The private insurance industry must once and for all be mandated to provide these services and share the fiscal burden that many of us here in Sacramento believe has been purposely and disingenuously avoided for many years by the private insurance industry.’’

Beall says that his bill if enacted, would provide significant and immediate cost savings to the State, which he says is currently paying the cost of health care services for many insured Californians with autism spectrum disorders through the Regional Centers, counties and school districts.

Beall believes his legislation will provide long term cost savings in the form of reduced state spending on special education, welfare and other ongoing social services by ensuring that children and adults with autism spectrum and related disorders  receive comprehensive treatment.

Rick Rollens, a Sacramento area parent of a son with autism spectrum disorders and a longtime advocate, praised Beall for introducing what he called a “historic bill”.

Health Insurance Reforms Not Specifically Part of Governor’s Budget

• Health insurance reforms such as Beall’s legislation is technically not part of Governor Jerry Brown’s budget plan as proposed – though would impact the plan by off-setting potentially tens of millions of dollars in State general spending cuts proposed to developmental services. 
• The bulk of Governor’s proposal for spending cuts to developmental services of over $750 million in State general funds is largely unspecified at this point – to be identified by the Department of Developmental Services in the coming months that will include spending cuts that could be achieved by imposing accountability, transparency, state purchase of service standards – and also health insurance reforms. 
• It is not clear at this point if Beall’s bill will somehow be included in whatever the Brown Administration will submit back to the Legislature later in the budget process.  [CDCAN will be issuing Action Alert urging that these reforms are included as part of the Brown Administration’s plan to achieve spending cuts in state general fund spending in developmental services]

Issue Was Focus of June 10, 2010 Info Hearing By Senate Select Committee on Autism and Related Disorders

The issues surrounding requiring private health insurance plans to cover critical services for people with autism spectrum and other disorders was the focus of a special informational hearing held June 10, 2010 by the Senate Select Committee on Autism and Related Disorders, chaired by Senate President Pro tem Darrell Steinberg (Democrat – Sacramento).

To view the a video recording of the hearing go to CalChannel: https://www.calchannel.com/channel/viewvideo/1491

Steinberg convened the hearing last year because he wanted to bring together all the representatives and advocates of all the parties connected to this issue to hear the different perspectives and concerns that could lead to possible solutions, including discussion on who and what must be covered under the federal Mental Health Parity Act.  

 Regional Centers Coordinate Services Under Contract by State

• The 21 non-profit regional centers under contract with the Department of Developmental Services, coordinates community-based services and supports to over 240,000 children and adults with developmental disabilities, including autism spectrum disorders (ASD).
• The numbers of persons diagnosed with autism spectrum disorders and eligible for regional center coordinated services has exploded into what advocates and policymakers alike say is an “epidemic”, with the population served growing from over 8,700 in 1997 to nearly 37,000 persons as of December 2007. 
• That number does not include thousands of other children and young adults who may be diagnosed with Autism Spectrum Disorders but are not eligible for regional center coordinated services after the State significantly narrowed eligibility in 2004 as one of the budget reduction measures enacted. 
• Regional Centers and developmental services overall have been hit with State budget cuts since late 2001, with a permanent reduction of over $500 million in State funds (including lost federal matching funds) in 2009 and another $750 million permanent reduction in state general fund spending proposed by Governor Brown in the 2011-2012 State Budget year.

NEXT STEPS

Unless an urgency (emergency) bill or part of the budget as a budget trailer bill, the following are the usual next steps for bills introduced:

• Regular bills introduced must wait 30 days from the date of its introduction before it can be heard in any committee (that would mean sometime after February 20th)
• This bill will be referred to at least one – possibly two different policy committees and then to Assembly Appropriations Committee if it passes out of  policy committee. 
• This bill will likely be heard sometime during March and April in policy committee in the Assembly
• May 6, 2011 – last day for policy committees to hear and report out bills to Assembly (or Senate) Appropriations Committee
• May 27, 2011 – last day for Assembly (and Senate) Appropriations Committee to report bills to the Assembly (and Senate) floor
• June 3, 2011 – Last day for Assembly to pass Assembly bills in order for those bills to continue on in the 2011 session (this rule does not apply to urgency bills)
• July 8, 2011 – If AB 171 makes it out of the Assembly, it must pass out of Senate policy committee or committees and be referred to Senate Appropriations Committee by this date in order to be considered for passage during the 2011 session
• August 26, 2011 – Last day for Senate (and Assembly) Appropriations to hear and report out bills to the Senate (and Assembly) floors.
• September 9, 2011 – Last day for any bill to be passed on the Senate or Assembly floors [bills not passed are carried over to the 2012 session in January]
• October 9, 2011 – Last day for Governor to sign or veto bills sent to him by the Legislature and in his possession after September 9th. 
• January 1, 2012 – Regular bills signed by the Governor during the 2011 session take effect (unless it is an urgency bill, which take effect immediately or whenever stated in the bill)