Legislature(2011 - 2012)BUTROVICH 205

03/30/2011 01:30 PM HEALTH & SOCIAL SERVICES

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved SCR 7 Out of Committee
Moved CSSB 22(HSS) Out of Committee
Moved SB 74 Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
         SB  74-INS. COVERAGE: AUTISM SPECTRUM DISORDER                                                                     
CHAIR DAVIS announced the next order  of business would be SB 74,                                                               
relating to insurance coverage for autism spectrum disorders.                                                                   
2:20:22 PM                                                                                                                    
SENATOR JOHNNY  ELLIS, sponsor  of SB  74, thanked  the committee                                                               
for hearing  the bill. He  said autism is a  devastating disorder                                                               
affecting one in 110 American  children. Despite being treatable,                                                               
most children  with autism spectrum  disorders never  receive the                                                               
treatment they need.  SB 24 would require  insurance companies to                                                               
cover treatment  for autism spectrum disorders  (ASDs), including                                                               
medically  necessary   applied  behavior  analysis   (ABA).  Most                                                               
insurance  policies specifically  exclude  coverage for  treating                                                               
autism. A  total of 35 states  and the District of  Columbia have                                                               
laws related to this issue,  and at least 23 specifically require                                                               
insurance  companies to  provide  coverage for  the treatment  of                                                               
According to  the governor's council on  disabilities and special                                                               
education,  insurance coverage  of treatment  of ASDs  would save                                                               
the  state  $280,500  per capita  in  avoided  special  education                                                               
costs, with a lifetime savings of $1.8 million per child.                                                                       
2:22:37 PM                                                                                                                    
The  majority of  children with  autism  who receive  appropriate                                                               
intervention  and  treatment experience  remarkable  improvement.                                                               
Early  intervention and  treatment work.  Forty-seven percent  of                                                               
those  treated  recover  typical  function;  forty  percent  make                                                               
significant  improvement, while  the  remaining thirteen  percent                                                               
make little progress.  Treatment can save the  state millions and                                                               
significantly improve the lives  of thousands. Families feel like                                                               
they are drowning without assistance.                                                                                           
2:23:50 PM                                                                                                                    
AMORY LELAKE,  staff to  Senator Ellis, said  she would  walk the                                                               
committee  through  the bill.  Section  one  amends AS  21.42  by                                                               
creating  a  new  section, AS  21.42.397  relating  to  insurance                                                               
coverage for  autism spectrum disorders.  Subsection (a),  page 1                                                               
line  1 through  page 2,  line  12, requires  insurance plans  to                                                               
cover  medically   necessary  treatment  for   autism  disorders.                                                               
Subsection (b), page 2 lines  13-23, further defines the coverage                                                               
that must be provided.                                                                                                          
Subsection (c),  page 2  lines 24 and  25, establishes  that this                                                               
section  does not  limit  coverage  already provided.  Subsection                                                               
(d),  page 2  lines 26-28,  prohibits an  insurance company  from                                                               
denying coverage to someone because  they have an autism spectrum                                                               
disorder. Subsection (e), page 2, line  29 through page 3 line 21                                                               
defines "autism  service provider," "autism  spectrum disorders,"                                                               
"health  care  insurance  plan,"  "health  care  insurance,"  and                                                               
"medically necessary."                                                                                                          
Section 2 page  3 lines 22-26 establishes that  the provisions of                                                               
section 1 only  apply to insurance policies  issued after January                                                               
1,  2012. Section  3, page  3 lines  27 establishes  an immediate                                                               
effective date for this act.                                                                                                    
2:25:58 PM                                                                                                                    
MS. LELAKE stated  there were numerous experts on  line who could                                                               
speak to the legislation.                                                                                                       
LAURIE  EUNAM, attorney  and  parent of  a  10-year-old son  with                                                               
autism, said she was testifying in  support of SB 74. She is also                                                               
senior litigation  council with  Autism Speaks, a  New York-based                                                               
non-profit.  Her   full-time  job  is  to   advocate  for  autism                                                               
insurance reform in all 50  states. Autism is a medical condition                                                               
brought on  by no  fault of  the family. In  slide #2,  the graph                                                               
shows distinct diagnoses within  the disorder; Autistic Disorder,                                                               
Asperberger's  Syndrome,  and Pervasive  Developmental  Disorder.                                                               
The  most  severe  diagnosis   is  Autistic  Disorder.  Pervasive                                                               
Developmental  Disorder Not  Otherwise  Specified  (PDDNOS) is  a                                                               
mild form of  autism spectrum disorder. It  accounts for one-half                                                               
of all diagnoses.                                                                                                               
There is no known  cure for autism but it can  be treated so that                                                               
symptoms  are   not  disabling.  The  most   commonly  prescribed                                                               
treatment protocol  is Applied Behavior Analysis  (ABA) which has                                                               
been  used for  many years  to  treat autism,  but the  insurance                                                               
industry  continues  to deny  coverage  for  this treatment.  The                                                               
Surgeon General,  the National Research Council  and the American                                                               
Academy of  Pediatrics all have  endorsed the use of  ABA therapy                                                               
for children with autism.                                                                                                       
2:30:32 PM                                                                                                                    
Studies show that if ABA  is administered intensively by properly                                                               
trained  therapists,  about half  of  the  treated children  will                                                               
overcome their autistic characteristics  such that they can enter                                                               
first grade indistinguishable from  their peers. The therapy must                                                               
be administered intensively,  often 20, 30, or even  40 hours per                                                               
week. Her  son's autism is  severe and  his therapy costs  out of                                                               
pocket  $75,000  per   year.  She  and  her   husband  have  made                                                               
sacrifices, such  as selling their  home and moving to  a cheaper                                                               
one, to afford therapy for their  son. But how many families have                                                               
that kind of  money to sacrifice? Most don't, and  so children go                                                               
We know  there is a treatment  that works but children  can't get                                                               
the treatment  they need.  These are families  who are  doing the                                                               
right thing  by buying  insurance, and still  can't get  the help                                                               
their children need.  Only the wealthy few  get treatment. Autism                                                               
prevalence is  on the rise.  Over the past  25 years it  has gone                                                               
from  one in  2,500  to one  in  110. A  huge  autism tsunami  is                                                               
coming. Without private insurance,  the needed treatment will not                                                               
2:34:02 PM                                                                                                                    
Twenty-four states  have mandated autism insurance  coverage. One                                                               
state has  passed a  bill in  2011, and  West Virginia's  bill is                                                               
about  to become  law. Actual  claims data  from Blue  Cross Blue                                                               
Shield  (BCBS) of  Minnesota, where  the law  has been  in effect                                                               
since 2001, shows  that the financial impact  for covering autism                                                               
is  .83  per  member  per  month. In  South  Carolina  the  state                                                               
employee health  plan has  released this  cost data:  the statute                                                               
passed in 2007 and took effect  in 2009. It caps coverage for ABA                                                               
therapy at $50,000  per year at age 16. In  2010 the increase was                                                               
.44 per member per month. The  law has minimal impact on premiums                                                               
and its overall  impact on the economy has  been positive. People                                                               
have been  trained and  are working  full-time as  therapists for                                                               
children with autism.                                                                                                           
2:38:55 PM                                                                                                                    
SENATOR DYSON asked is it logical  to assume that in a state like                                                               
Alaska with  a very small  population, the cost per  policy would                                                               
be higher.                                                                                                                      
MS. EUNAM answered if that  was typically the case, then probably                                                               
SENATOR DYSON  said it would  seem that  if South Carolina  has a                                                               
cost  of .44  cents per  month with  around five  million people,                                                               
compared to Alaska with only  700,000 people, the cost per policy                                                               
holder would be higher.                                                                                                         
MS. EUNAM  said she would  let the  actuary speak in  more detail                                                               
about that. Cost projections from  state to state have not varied                                                               
dramatically, and  she was not  aware of any factors  specific to                                                               
2:41:31 PM                                                                                                                    
MARK LAMBRIGHT, Independent Actuary,  Oliver Wyman, said he would                                                               
address the  previous question. In  doing the  actuarial studies,                                                               
they  did  consider that  medical  costs  are higher  in  Alaska.                                                               
However, due  to fewer  people being  covered, the  overall costs                                                               
would be lower.  The costs per member would be  roughly the same.                                                               
Analysis  indicates  that  premiums   would  increase  .3  to  .7                                                               
percent. The  net result is  an estimate of cost  increase. Other                                                               
independent actuaries have provided similar analyses.                                                                           
2:45:04 PM                                                                                                                    
MARGARET COSSLER, Anchorage,  said she was speaking  on behalf of                                                               
her five year old son with  autism. She and her husband wanted to                                                               
find  the best  possible treatment  for their  child. Not  having                                                               
insurance to  cover this is  extremely stressful for  the family;                                                               
knowing that  there is something  you can  do to help  your child                                                               
but  you  cannot  provide  it is  extremely  painful  and  nearly                                                               
2:47:05 PM                                                                                                                    
SENATOR ELLIS  noted that Representative Petersen  had joined the                                                               
2:47:37 PM                                                                                                                    
JANICE  GERTON,  mother of  Chad  Gerton,  testified on  her  own                                                               
behalf.  He  was diagnosed  as  Autistic  at  age  5. At  12  his                                                               
diagnosis changed  from Autism to  Asperberger's Syndrome.  At 18                                                               
months they  knew he was  not the  same as their  other children.                                                               
Each  doctor   they  saw  said   he  did  need   speech  therapy,                                                               
occupational  therapy,  sensory   integration.  When  he  started                                                               
school they  gave him  an IEP  and they did  what they  could. He                                                               
never  lost  language  but  had   many  issues  with  peers.  His                                                               
experiences were  hard for the family  and hard for him.  Her job                                                               
became  24 hours  trying to  find services.  The family  had good                                                               
insurance but it did not cover what he needed.                                                                                  
Early  intervention has  been proven  the best  way. There  would                                                               
have been  less impact  in his  life and life  of his  family. He                                                               
needed this in  school, home, and community. One out  of 110 kids                                                               
is affected. Four out of  five are boys. Intervention should have                                                               
come  early, but  it  was very  slow.  Early intervention  works.                                                               
Fewer  services are  needed over  a lifetime.  Her son  became an                                                               
Eagle  Scout,  his senior  class  treasurer,  and has  become  an                                                               
accountant. At  age 25,  he was recently  married. He  is working                                                               
full  time and  taking 12  credits at  UAS. Children  with autism                                                               
need a good health plan.                                                                                                        
2:52:13 PM                                                                                                                    
This  should be  in place  for the  next generation  so they  can                                                               
receive early intervention and have  the best possible quality of                                                               
life. Her son  still has issues because he lacked  the right type                                                               
of  services early  on. The  month of  April is  Autism Awareness                                                               
Month; they  are trying  to get people  to understand  and accept                                                               
the differences.                                                                                                                
2:53:33 PM                                                                                                                    
CHAIR DAVIS thanked the witness for coming forward.                                                                             
LAURIE KING, mother  of a 20 year old daughter  with autism, said                                                               
her family didn't  have the insurance they needed to  take her to                                                               
the  specialists at  an  early  age. They  had  insurance but  it                                                               
didn't cover what they needed.  Her husband was diagnosed with MS                                                               
and unable to work, so she had  to work instead of taking care of                                                               
her daughter. She  said her daughter would have  done much better                                                               
with earlier  intervention. They could  not get services  for her                                                               
until age eight;  as a result, her potential to  be a functioning                                                               
member of society was severely degraded.                                                                                        
2:59:59 PM                                                                                                                    
CHAIR DAVIS  said the committee  had heard good testimony  on the                                                               
bill today. She  also had several letters and  emails of support.                                                               
BCBS of Alaska is in opposition.                                                                                                
3:00:57 PM                                                                                                                    
CHAIR DAVIS invited Representative Petersen to testify.                                                                         
REPRESENTATIVE PETE  PETERSEN said when  you hear the  stories it                                                               
is  hard  to  believe  the  lack  of  coverage  still  continues.                                                               
Children  are  missing their  window  of  opportunity to  have  a                                                               
normal life.                                                                                                                    
CHAIR DAVIS asked for a motion to move the bill.                                                                                
SENATOR  DYSON  said he  had  some  remarks  but given  the  time                                                               
constraints he would not speak.                                                                                                 
CHAIR DAVIS asked why not a short version.                                                                                      
3:03:02 PM                                                                                                                    
SENATOR  DYSON said  he applauds  the purpose  of the  bill. What                                                               
troubles him is  the funding source. The  insurance companies are                                                               
not the problem. When we get down  to figuring out how we serve a                                                               
good  purpose,  he  worries  that we  choose  pragmatism  at  the                                                               
expense of  freedom. He  agrees that  services for  children with                                                               
autism need  to be available. The  righteous way would be  to pay                                                               
for it  out of  the general  fund so that  everyone has  the same                                                               
chance. There  is a fairer way  to get services to  children, and                                                               
that is  to do  it through  the tax base.  Putting the  burden on                                                               
insurance  companies   is  easier,  but  he   worries  about  the                                                               
direction we are going.                                                                                                         
3:06:42 PM                                                                                                                    
He also  questioned having a  zero fiscal note. Maybe  it doesn't                                                               
come out  of the state's  pocket, but it  will come out  of state                                                               
employees' pockets.  He does applaud  the intentions of  the bill                                                               
and his heart goes out to the kids.                                                                                             
3:07:37 PM                                                                                                                    
CHAIR DAVIS said this bill  has another committee of referral and                                                               
some of those issues will be heard there.                                                                                       
SENATOR  EGAN  moved   to  report  SB  74   from  committee  with                                                               
individual  recommendations and  attached  fiscal note(s).  There                                                               
being  no objection,  SB  74  moved from  the  Senate Health  and                                                               
Social Services Standing Committee.                                                                                             

Document Name Date/Time Subjects
SCR 7 Sponsor Statement.pdf SHSS 3/30/2011 1:30:00 PM
SCR 7 Bill Text.pdf SHSS 3/30/2011 1:30:00 PM
SCR7 10 Things You Should Know About FAS.pdf SHSS 3/30/2011 1:30:00 PM
SCR7 FASD Economic Cost pgs 34-37.pdf SHSS 3/30/2011 1:30:00 PM
SB 22_Version A.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 Sectional Analysis Version A.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB22 CS Version B.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 Summary of Changes Version B.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 Youth Concussion Ed Pack.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 State Legislatures Article.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 NPR Story.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 LetterOfSupport ABIN.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 Brain Injury Association of WA.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 Boston Univ Article.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 22 AATA Letter of Support.pdf SHSS 3/30/2011 1:30:00 PM
SB 22
SB 74 Bill.pdf SHSS 3/30/2011 1:30:00 PM
SB 74
SB 74 Sectional Analysis.pdf SHSS 3/30/2011 1:30:00 PM
SB 74
AK HB 79- SB 74 Actuarial Cost Analysis 3 4 2011 FINAL.pdf SHSS 3/30/2011 1:30:00 PM
HB 79
SB 74
SB 74 Autism Plan Progress.pdf SHSS 3/30/2011 1:30:00 PM
SB 74
SB74 Breaking Through.pdf SHSS 3/30/2011 1:30:00 PM
SB 74
SB74 Ganz Article on Societal Costs.pdf SHSS 3/30/2011 1:30:00 PM
SB 74
SB74 Stone Soup Group.pdf SHSS 3/30/2011 1:30:00 PM
SB 74
SB74 Trust Letter.pdf SHSS 3/30/2011 1:30:00 PM
SB 74