Legislature(1995 - 1996)
04/23/1996 03:04 PM House HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CSSB 253(FIN) - INS.FOR PROSTATE & CERVICAL CANCER TESTS CO-CHAIR BUNDE announced the next item on the agenda was CSSB 253(FIN). He turned the gavel over to Co-Chair Toohey. Number 543 KRISTINE PELLET, Student Intern to Senator Jim Duncan, said the importance of screening for malignant cancer is well documented. Both prostate and cervical cancer can be detected early by simple screening procedures and Senator Duncan believes that insurance companies should provide coverage for these screening procedures. Prostate cancer accounts for 36 percent of all male cancer and is the second leading cause of death in men after lung cancer as reported by the National Cancer Institute. It is estimated that this year in the United States 25,000 men will be diagnosed with prostate cancer and about 40,000 men will die from this disease. Although often presumed to develop slowly, nearly two-thirds of new cancer cases have spread beyond the prostate gland by the time of diagnosis. In addition to coverage of the Prostate Specific Antigen (PSA) test, SB 253 would require coverage for cervical cancer screening. Cervical cancer accounts for about 16 percent of all cancers in women. It is estimated that nearly one-half of the approximately 15,000 women who are diagnosed annually with the condition never underwent early screening procedures which could have led to highly successful treatment. Senate Bill 253 makes health issues a priority. Senator Duncan welcomes the committee's support in requiring that insurance companies cover the cost of prostate and cervical cancer screening. Ms. Pellet offered to answer any questions from the committee. Number 617 REPRESENTATIVE ROKEBERG asked what the approximate cost is for a PSA test and a Pap smear? Number 643 JANET PARKER, Retirement & Benefits Manager, Department of Administration, testified the cost of a PSA test is between $60 and $70 in the state of Alaska. She didn't have the information available on the cost of a Pap smear test. CO-CHAIR TOOHEY said as a recipient of a Pap smear for many years, the cost runs between $60 and $80. CO-CHAIR BUNDE pointed out there had been a Health Fair a couple of weeks ago and the cost of a PSA test was $30. CO-CHAIR TOOHEY asked if there were any questions for Ms. Parker. Hearing none, she asked Gene Dau to present his testimony. Number 689 GENE DAU, Representative, American Association of Retired Persons and Veterans of Foreign Wars, said that prostate cancer is an issue that men don't particularly like to talk about, even with their doctors. His doctor talked with him about prostate cancer and encouraged him to take the blood test, which he did. He said prostate cancer is the second largest killer of men in the United States. He shared the story of the Juneau swim coach who hadn't undergone the screening test and discovered he had prostate cancer. Unfortunately, it wasn't detected earlier enough and the cancer spread through other parts of his body. He was given 17 months to 35 months to live. He noted this is a problem and something needs to be done to encourage men to take this simple test. Mr. Dau believed that requiring insurance companies to provide and pay for the test will result in more men taking the test as part of their annual physical so it can be detected early enough and treated. In most cases it can be cured if it is detected early. He supports the bill without the amendment which changes the language to "offer" rather than "provide" coverage for the costs of prostate cancer screening tests. If the test is offered, the patient could still have to pay for it, whereas if it is provided, the insurance company will have to cover the cost. Number 870 CO-CHAIR BUNDE agreed that men should take more control of their health and be more aware of prostate cancer. However, he disagreed that insurance companies will pay for the testing in that everyone will pay for it through increased insurance premiums. The insurance companies are not going to take the costs out of their profits just because it's mandatory coverage; they will simply raise the premiums to cover the service. MR. DAU thought it would be advantageous for the insurance companies if cancer is detected in the early stages in that it would certainly save a lot of money later on. CO-CHAIR TOOHEY commented that's called preventative medicine and that's always advocated but not necessarily funded. She asked Mr. Dau if he would continue to have the screening test even without the insurance company paying for it. MR. DAU said he probably would. However, he thought it would encourage more men to discuss it with their doctors and have the screening test. He commented there were a lot of people living on fixed incomes who probably couldn't afford to pay for the test and he believed that everything should be done to encourage men to have the PSA test. CO-CHAIR TOOHEY thought education was the key and AARP played a vital role in getting the message out of the importance of the screening test through their monthly newsletters. Personally, she didn't believe it was the role of government to insist that people get a PSA test, Pap smear or mammogram. Number 1074 BILL CHISHAM, resident of Juneau and state employee, testified in support of CSSB 253(FIN) on his own behalf. He noted that in 1991 Aetna covered the cost of his PSA test and the cost was $77. The first two years he had the test, Aetna covered the cost; however, the last few years Aetna has not paid for it. He inquired of Aetna why they would no longer cover the cost and the response he received was, "Well, apparently we made a mistake before by covering the cost of the test." He continues to have the test and to pay for it himself because he is in the age range at risk. He noted that a dental examination is covered as preventative medicine, but Aetna alludes to the fact that the PSA test may be preventative medicine and therefore will not cover the cost. He related that he is not opposed to insurance companies. He attended the Aetna school on health insurance a number of years ago and has spent approximately the last 30 years reviewing insurance contracts and dealing with insurance matters. He urged the committee's support of this legislation. CO-CHAIR TOOHEY remarked that people should be encouraged to take advantage of the services offered at the recent Health Fair, which is half the cost for the PSA test. REPRESENTATIVE ROKEBERG asked if he was correct in that Aetna had drawn a distinction between this being a preventative type medicine vis a vis a treatment. MR. CHISHAM said yes, it was his understanding the doctor would do the examination with the potential of detecting something rather than treating something. He questioned how that would equate with going to a dentist on an annual basis, finding a cavity and then taking the action to correct that, whereas Aetna would not cover this on the same basis. He added there apparently was a medical opinion, which he didn't feel qualified to comment on, that perhaps this test is not the best way to detect prostate cancer. However, he felt there was argument on both sides of that issue. When there are two tests available and this test offers a very scientific approach, he was more in favor of this test than hoping the examining physician in conducting the other test can detect a minuscule difference in size or texture of what he is examining. He felt there was too much possibility that something might be overlooked during the examination, so he had more faith in this test. Number 1292 BOB STALNAKER, Director, Division of Retirement & Benefits, Department of Administration, testified the Administration supports CSSB 253(FIN). He noted that everyone knows there are certain steps that can be taken to find illnesses earlier on that will save the health costs into the future for both insurance companies and employers. However, it is a hard step to take because it generally costs money up-front to be able to find illnesses in the earlier stage. He clarified that under the state of Alaska's plan, this test is not denied all the time; it is covered after the digital test has been performed or if there is indications by the doctor that there is the need for this test as a further test. Also, the test itself is generally performed in a well-physical and that is a cost borne entirely by the employee at this point. He explained that's why the fiscal note from the Division of Retirement & Benefits shows there will be an impact on the plan. He commented that if the number of tests increase, there will be a cost but the employees are paying the cost themselves now by virtue of the Supplemental Benefits System (SBS) Option 1. CO-CHAIR TOOHEY asked him to explain how the employees are paying now. MR. STALNAKER explained the Supplemental Benefits Option 1 provision under the state plan provides for an annual well- physical. Currently, the annual well-physical will cover a digital exam and only in the case that further test is needed will the plan cover this test. In other words, the current plan covers the digital exam. This bill would provide for the SBS to also cover the blood test as an initial test. CO-CHAIR TOOHEY inquired if the state plan covers the cost if the doctor would like to do blood test, also. MR. STALNAKER responded it would not be covered in the event the doctor would like to do the test; there has to be an indication or a finding by the doctor. Number 1441 REPRESENTATIVE VEZEY questioned why this wasn't negotiated into the contract if the Administration believes this is a good idea; there doesn't need to be a law to negotiate benefits for employee health coverage. MR. STALNAKER stated that was true for the state and yes, the state employees can through negotiation amend the health contracts to include these provisions at whatever the cost is, which he believed wouldn't be much. The Administration support is as a public policy: Early detection helps find the number 2 killer of men in the country at an early stage where not only can treatment be provided that will save lives but also at a much lower cost to the health industry as a whole. The Administration's support is based on the policy issue that pre-advanced notice through this kind of test is more accurate than just a digital type of an examination. REPRESENTATIVE VEZEY again questioned why the Administration didn't negotiate that into the health benefits package for state employees. MR. STALNAKER remarked he is not part of the negotiations for labor contracts and he wasn't sure what the strategy is currently with negotiating on the contracts for this unique provision. Therefore, he couldn't speak to if the Administration is or why it isn't negotiating to include this provision under the plan. He reiterated the inclusion of this provision under the state health plan deals with state employees, and it does not deal with the coverage of this kind of treatment in general. REPRESENTATIVE VEZEY noted there are a number of state employees who are not part of a bargaining unit, but they are covered by the state plan the Administration puts together on their behalf. If the Administration believes this is a good policy, why don't they negotiate it into that service? MR. STALNAKER pointed out that a change in the health plan is being looked at for non-covered employees which would include a flexible benefit plan that employees then could select certain types of coverages but there would be minimal coverages. As a matter of fact under that plan, one of the minimal coverages is a well- physical for employees annually because it has been determined that it is a good idea for people to get physicals from time to time. Therefore, the idea of preventative care or early detection would be embedded in that approach to the flexible plan being looked at. REPRESENTATIVE VEZEY asked Mr. Stalnaker, "Then is your testimony that the Administration intends to make this sort of health care as a mandatory provision that's employee's health care packages for non-covered employees at least, if not for covered employees?" MR. STALNAKER said, "The Administration's position is that these types of treatment are good for the health costs as a whole for early detection. What part of these coverages, whether it be Pap smears, whether it be -- well, mammograms are already mandated coverage, but that these kind of early detection tests are beneficial with the end result because the end result of the health plan will be the result of a group of people that will include legislative employees as well as Executive Branch employees as well Court system employees, deciding exactly what kind of coverages will be provided. So, I can't speak to a guarantee, but certainly the Administration is supportive of early detection and the types of tests that would help to provide early detection." REPRESENTATIVE VEZEY asked if that means the Administration is going to insist that this sort of medical plan be included in its health care programs in the future or not? MR. STALNAKER responded he couldn't speak specifically as to what the plan will look like at the end. He could however, say the group that has worked on this plan to this date, meaning the supervisory bargaining unit as well as the Administration, believes there is value to early detection tests and types of medical treatments that would provide early detections. Number 1748 CO-CHAIR TOOHEY asked why these people making the decisions on what is included in the new contracts weren't at the hearing to testify? She felt it was important to get the word to them that the committee believes these tests are necessary. She announced the bill would be held over until the following Tuesday to allow the people involved to be present. REPRESENTATIVE VEZEY said that Mr. Stalnaker had testified the Administration supports this legislation, and then testified the Administration thought it would be a good idea to put in the contract, but they weren't sure. He asked if the Administration is sure this legislation is a good bill? MR. STALNAKER responded the Administration thinks this bill is a good idea. CO-CHAIR TOOHEY asked if the Administration thinks testing is a good idea or do they think this bill is a good idea? MR. STALNAKER replied the Administration believes testing is a good idea. Number 1877 REPRESENTATIVE ROBINSON said this bill, as written, basically provides this coverage to all people of the state, not just state employees. MR. STALNAKER responded that was correct. REPRESENTATIVE ROBINSON felt this would probably be difficult to negotiate into a contract since the legislature has continued to indicate they want any contract negotiations to come in at a lower amount. MR. STALNAKER confirmed that. He added there had, at times, been comments that the state's plan is very generous and that is a sensitive issue as the unions and Administration negotiate. REPRESENTATIVE ROBINSON surmised it was the Administration's position as preventative measure, that it is important all insurance coverage for health benefits offer the opportunity for people to be able to get this kind of screening and have it paid for. MR. STALNAKER said that was correct. Number 1963 CO-CHAIR BUNDE said Representative Robinson had used two important key words - opportunity and offering. As a person who could be impacted by prostate cancer, he had done some research on the issue and had read that on a statistical average nationwide, participating in this screening test extends the life of prostate cancer victims by six months and may in some cases decrease the quality of life for the individuals who get a PSA test that is high, have surgery and end up being incontinent the rest of their life. He noted there are some down sides; it should be a personal decision and it is not going to prevent or cure prostate cancer. MR. STALNAKER agreed there are weaknesses as well as strengths with this type of testing and people involved need to know what the numbers indicate. However, it is a way that through a general battery of blood tests the cost of the PSA test could be cut from $70-$80. TAPE 96-45, SIDE A Number 025 CO-CHAIR BUNDE said he believes there is some validity in the test and like many things it has some upsides and downsides. He thought the choices should be made available to as many men as possible and in the case of cervical cancer, to as many women as possible, but it is not free. He admitted that maybe people are more inclined to take the test if the money is not coming out of their pocket at the moment, but that's no substitute for personal responsibility. He was inclined to change it to a mandatory offering rather than mandatory coverage, which allows a menu of services so to speak, and people who are more inclined to need the services won't take it out of their pocket at the time they need the test, but will pay a premium over a period of time. He asked what Mr. Stalnaker's reaction was to changing it from a mandatory coverage to a mandatory offering. Number 173 MR. STALNAKER said, "Over the years as a health plan administrator, I generally am philosophically opposed to mandated coverages for many of the reasons that were brought out, when I see over the years certain things that you get a real good return for your investment. That's my thinking and I think this is one of those things and that's why I think it is a good idea. It isn't lightly that I say that because I don't think the place is to force an employer to have to provide certain coverages, but sometimes you do things for people's own good. And I think this is a test that will save that employer a lot of money through the very free market dynamics that you identified. Because the same can happen if you pay a little bit up-front and the cost of that treatment for prostate cancer or for late detection, if they have positive results from the test can lower the costs of those same health plans in the future. It is for those reasons that I believe this is a good idea. I think changing it to a mandatory offering would certainly dilute what the bill is trying to do in that respect. The bill does provide for mandatory, and you're suggesting mandatory offering. I think it is better than nothing because it at least puts it out in the front and makes it an issue to discuss with employers as insurance plans are suggested." CO-CHAIR TOOHEY thanked Mr. Stalnaker for his testimony and asked Gordon Evans to come forward and present his testimony. Number 317 GORDON EVANS, Lobbyist, Health Insurance Association of America, testified that as a representative of his client, they were opposed to this legislation in its present form because of the mandated requirement. Mandated benefits result in increased premiums more so in individual policies than in group policies because the benefit can be negotiated in a group policy where there are more people in which to spread the cost. The Health Insurance Association of America does support a mandated offering because then the insurance companies can take it into consideration in their underwriting. He said incidentally, the Health Insurance Association of America does not include Aetna or Blue Cross. MR. EVANS said on an individual basis, he recently underwent the PSA testing as a part of his physical, and felt comfortable knowing he got a low rating. He noted the cost was $36 with his family physician, so it isn't all that expensive. With regard to insurance companies not covering the cost of the PSA test because of it being preventative medicine, his client had advised that it's not because it's preventative, but rather it's still considered experimental and insurance companies do not pay for experimental tests. As an individual, he felt the testing was a good thing but he didn't know that his insurance company should necessarily pay for it or if he should. He concluded that if the bill were changed to a mandated offering, the association would support it. Number 504 CO-CHAIR TOOHEY asked if Mr. Evans' client considered Pap smears and mammograms experimental? MR. EVANS said he did not know, but added that mammograms have been mandated in this state for several years. CO-CHAIR TOOHEY asked if there were any questions for Mr. Evans. Hearing none, she asked Reed Stoops and Jerry Reinwand to testify. CO-CHAIR TOOHEY asked if either Aetna or Blue Cross of Washington & Alaska offered mammograms and Pap smears and/or PSA testing in state contracts? Number 609 REED STOOPS, Lobbyist, Aetna Life & Casualty, testified that Aetna handles the state contract and covers mammograms, Pap smears and PSA testing, but as Mr. Stalnaker pointed out, if it is requested by a doctor for medical reasons, it's covered. In the case of the PSA test, occasionally it is not covered if it is at the request of the patient on a normal screening basis and there is no other interaction with the physician. CO-CHAIR BUNDE said, "So it is often covered but not always covered." CO-CHAIR TOOHEY commented it was just two years ago that mammograms were covered; before that they were never covered. MR. STOOPS understood it was the same criteria; they were covered if it was requested by the physician. There would be a physical exam first followed by a mammogram, if considered appropriate. Number 671 JERRY REINWAND, Lobbyist, Blue Cross of Washington & Alaska, said basically it operates the same for Blue Cross of Washington & Alaska. He added that it depends on how the health care providers deal with it. He thought that under the retired state employee plan, a physical examination is not covered. But if the doctor bills it as a diagnostic test, it is covered so providers can figure out how to get around it. CO-CHAIR TOOHEY asked if there were further questions. She asked Mr. Stoops and Mr. Reinwand if they could see the need or benefit monetarily for preventative medicine? Number 747 MR. STOOPS replied yes, on behalf of Aetna. As a matter of principle, Aetna normally agrees with the Health Insurance Association in that mandated coverages are often opposed because of the fact that they increase the cost of care. In the case of mammograms, PSA tests and Pap smears, Aetna does not oppose the idea of making those mandatory if the legislature feels that benefits outweigh the small cost. Those are areas that Aetna has not opposed that kind of legislation. He felt the argument could be made that in the end early detection should result in more efficient treatment later on and ultimately will avoid high catastrophic treatment at a latter point if not detected. He thought where there had been disagreement, it's been the fact that new tests as they evolve become increasingly dependable and there's increasing agreement among providers on exactly how to use the test to best achieve the desired results. So early on there is often disagreements about whether they should be covered or not. He felt that PSAs, mammograms and Pap smears have evolved to the point now where they are becoming increasingly common and not quite as controversial as to their effectiveness. Therefore, he felt it was more a matter of policy as to whether the legislature wanted to make them mandated coverages. Number 845 MR. REINWAND said he shared Mr. Stoops' feelings and added there has been a shift in the insurance industry where things that were fought and not acceptable four or five years ago are now becoming more acceptable. He said Blue Cross has had a change in management and a change in how things are viewed and he felt generally they were trying to be more enlightened. For example, when health care was being debated in the legislature, Blue Cross came forward with a proposal advocating a kids program that would have basically been preventative in nature and very cost effective. He concluded that generally Blue Cross is supportive of preventative measures because it saves money in the long run. CO-CHAIR TOOHEY asked if Blue Cross paid for infant immunizations? MR. REINWAND didn't know, but said he would check into it. MR. STOOPS remarked that Aetna donated vaccine to the state several years and provided grant funds for non-state employees to get free infant vaccinations. CO-CHAIR TOOHEY announced that she would be holding CSSB 253(FIN) in committee until the following Tuesday. Number 944 REPRESENTATIVE ROKEBERG asked if Blue Cross provides these tests in their individual plans, non-group policies that are offered to the public? MR. REINWAND said he would have to get back with Representative Rokeberg; he didn't know at this point. CO-CHAIR TOOHEY commented she didn't think there was an insurance plan that didn't have a deductible, and she thought it would be wonderful if there was an incentive such as deducting a certain amount off their next visit for people who use their deductible for a mammogram or a Pap smear. MR. REINWAND stated that Blue Cross of Washington & Alaska is having lots of problems in individual policies because of the "Reform Bill" that was passed in the state of Washington and it's common knowledge that individual policies cost about $30 million worth of losses to the company last year simply because of the mandates and things of that nature. CO-CHAIR TOOHEY reminded committee members that CSSB 253(FIN) would be held over in committee.
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