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 autism. 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 untreated. 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 happen. 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 yes. 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 Alaska. 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 unbearable. 2:47:05 PM SENATOR ELLIS noted that Representative Petersen had joined the meeting. 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.