Legislature(1997 - 1998)
03/11/1998 09:10 AM Senate HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 260 - INSURANCE COVERAGE FOR CONTRACEPTIVES
SENATOR ELLIS, sponsor of SB 260, gave the following synopsis of
the measure. SB 260 is known as the Contraceptive Coverage Act.
It is intended to broaden the coverage for prescription
contraceptives in the State of Alaska through private health
insurance plans. Nationwide, most plans exclude such coverage:
only one-third of health insurers cover oral contraceptives, the
most popular method; 15 percent cover diaphragms; 18 percent cover
IUDs; and 24 percent cover hormonal implants. Coverage in Alaska
is no better. Those specific birth control methods are the most
effective, are more costly, and are obtainable only from a health
care provider. Though most insurance plans provide no
contraceptive coverage, they routinely cover abortions,
sterilization, tubal ligation, infertility, and impotence
treatments, all more expensive procedures related to fertility.
Increased access to contraceptive services will help families to
bring children into healthier homes when the time is right.
Senator Ellis noted a slide presentation was prepared to show
committee members the economic and social benefits of expanding
contraceptive coverage.
CHAIRMAN WILKEN introduced MICHELE GEARHART, legislative aide to
Senator Ellis, who would be assisting Senator Ellis with the slide
presentation.
Number 434
SENATOR ELLIS discussed the first slide which contained 1987
statistics on pregnancies by outcome, the most recent statistics
available from national sources. The statistics are as follows:
43 percent of all pregnancies were intended pregnancies;
20 percent of all pregnancies were mistimed pregnancies;
8 percent of all pregnancies were unwanted pregnancies; and
29 percent of unwanted or mistimed pregnancies result in
abortions.
The second slide showed that of the 5.4 million pregnancies that
occurred in the last decade, 3.1 million were unintended at the
time of conception. Of that 3.1 million, 1.5 million resulted in
live births while 1.6 million ended in abortion. Only 2.3 million
pregnancies were intended at the time of conception and resulted in
live births.
SENATOR ELLIS emphasized that intendedness is a big issue for all
couples. Statistics show that 57 percent of all pregnancies are
unintended. The next slide gave the percentage of women who
unintendedly become pregnant according to age, marital status and
FPL. The Alaska Pregnancy Risk Assessment Monitoring System
(PRAMS) data indicates that of pregnancies among Alaska women, 41
percent were unintended; 90 percent of the women were not using, or
improperly using, a birth control method.
CHAIRMAN WILKEN asked about the PRAMS program.
KAREN PEARSON, Division of Public Health, DHSS, explained PRAMS is
a voluntary survey conducted by DHSS, about six months after a
birth, to compile information on all live births in Alaska. 14
other states have similar surveys.
CHAIRMAN WILKEN asked what percent of surveys are returned.
MS. PEARSON answered the responses are broken down by strata but
she estimated 60 to 80 percent are returned, depending on the
strata.
SENATOR ELLIS stated that unintended pregnancy is costly on many
levels. The costs to the family include abuse, poverty, and
divorce - costs that have a direct impact on the state budget. The
social costs include lower paying jobs, higher unemployment, and
greater likelihood of welfare receipt. He added the hard core
economic costs are pregnancy care costs in the form of ectopic
pregnancies, induced abortions, spontaneous abortions, and term
pregnancies.
SENATOR ELLIS explained the next two slides contain information
from a book entitled The Best Intentions. The slides listed the
consequences for unplanned babies and the consequences for family
formation.
SENATOR ELLIS reviewed information about health plans. Despite
nearly universal drug coverage, many health plans exclude
contraceptives: 97 percent offer prescription drug coverage of
other types but 49 percent fail to cover contraceptive methods.
Only 15 percent cover all five reversible methods of contraception
(IUD, diaphragm, implants, injections, and oral contraceptives).
Many policies exclude contraceptives even if they are prescribed
for a medical condition other than birth control.
The next slide showed the medical costs over five years of using
contraceptives versus no method, which leads to wanted and unwanted
pregnancies.
SENATOR ELLIS stated the average out of pocket cost for oral
contraceptives is $25 per month. Adding oral contraceptives to a
drug card plan increases employee cost by about $16.20 per year, or
$1.35 per month. He added that gender inequity does exist in these
health care plans. On average, women pay more and get less for
their health insurance coverage. In sharp contrast, most health
insurance policies offer full coverage for drugs and devices for
men, including prostate treatment, penile implants, testicular or
urogenital diseases and medication for male impotence.
CHAIRMAN WILKEN thanked Ms. Gearhart for the presentation materials
she provided for the committee.
Number 506
SENATOR ELLIS summarized by saying society is spending millions of
dollars on the consequences of unintended pregnancies. Support for
family planning is broad and contraceptive coverage is cost
effective. If all families had access to contraception, more
children would be wanted, poverty and welfare dependence would be
reduced, and the number of abortions would be reduced dramatically.
He quoted the former surgeon general of the United States as
follows, "The starting point of effective child abuse prevention is
pregnancy planning."
Senator Ellis noted his appreciation to Tom Atkinson of
Representative Croft's staff who helped prepare the materials for
the presentation.
CONNIE PAGE testified on her own behalf from Fairbanks. She
questioned why insurance companies are not already covering all
contraceptives. Contraceptives have been regularly excluded by
insurers even though they are the most widely used drugs by women
aged 18 to 44. Oral contraceptives and hormonal implants are the
most effective, yet they are expensive and obtainable only from a
health care provider. As the mother of two daughters, she is aware
of the statistics on teen pregnancy. The fact is many teens are
sexually active at an early age, whether parents want them to be or
not. She wondered how low income families face the costs of
contraceptives and the hard choices they are forced to make.
Research data from the Alaska Division of Public Health show that
one-half of the births in Alaska are unplanned. Improving private
insurance coverage for contraceptive services, or increasing access
to contraception, can reduce barriers to effective family planning.
Ms. Page commented that it is ironic that insurance plans cover
impotence treatment to assure that men can be sexually active while
women are not assured that their pregnancies can be prevented.
BETH CARLSON testified from Eagle River on her own behalf in
support of SB 260. Women pay 68 percent more in health care
expenses during their reproductive years than do men, due in large
part to the costs women must pay for reproductive health care, such
as gynecological care and contraception. The lack of coverage of
these health care costs places a heavy burden on young families
struggling with many other expenses. Requiring insurance companies
to cover prescription and device contraceptives would not only be
economically beneficial to insurance companies but will benefit
young women and couples. SB 260 will also benefit Alaska
businesses. In a one year time period, 85 percent of women in
their childbearing years, who are sexually active but do not use
contraception, become pregnant, as opposed to only three to six
percent of such women who use oral contraceptives. As any employer
knows, a pregnancy, whether planned or unplanned, affects worker
productivity. Many women experience morning sickness, have
required doctor's visits, sometimes require bed rest, and need time
off for the birth itself and maternity leave. The husband's
productivity can be affected for various reasons as well.
Requiring insurance companies to cover the costs of contraception
will almost certainly decrease the number of unintended
pregnancies, and will benefit not only those women and couples who
are not yet prepared to have a child, but also the businesses that
employ them. Requiring insurance companies to cover prescription
contraception is also a way to ensure that every child is wanted
and loved from the moment of conception. She urged committee
members to pass SB 260.
SENATOR ELLIS asked anyone who has written testimony to fax it to
the committee to be included in committee packets.
ROBIN SMITH testified on behalf of herself and her husband,
business owners with 11 employees, in strong support of SB 260. In
the last couple of years, they have seen a number of both male and
female employees deal with unintended pregnancies. Every case has
been stressful as well as a financial and time burden. As an
employer, she can support employees by providing medical insurance
for contraception which she believes to be basic health care for
women. In our society, it is a woman's responsibility to prevent
unintended pregnancies. While most employment related insurance
policies in the United States cover prescription drugs in general,
a vast majority do not include equitable coverage for prescriptive
contraceptive drugs and devices. Similarly, while both policies
cover outpatient medical services in general, they often exclude
outpatient contraceptive services. This failure is costly, both to
insurance companies who may have to pay for maternity care, as well
as families whose lack of physical and financial well-being is
threatened by an unintended pregnancy and the lack of access to
equitable coverage for contraceptives.
TAPE 98-24, SIDE B
MS. SMITH continued. Young women entering the workforce frequently
start out at minimum wage at a time when they need contraceptives
most and can least afford them. As previously stated, women pay 68
percent more in out-of-pocket medical expenses during this time
period. Unintended pregnancies can also damage a woman's career.
Having the added cost of child care rapidly erodes the purpose of
working. If a young woman already has one infant in child care,
the cost of a second child could force her to quit her job.
Maintaining a well trained dependable staff is vital to operating
a profitable business. Encouraging planned pregnancies when young
adults can afford a family simply makes sense.
MARY OSTBACK testified from the perspective of a contraceptive
consumer. Her husband's state insurance policy allows two options
regarding contraception: a vasectomy or tubal ligation. When
neither option is suitable, women are forced to pay for any of the
other options available. This places an unfair burden on women
who are already paying much more than men do in health care costs.
She believes the state should ensure that women have the support
and ability to prevent pregnancies so that they do not have to take
advantage of other options. She stated her strong support for SB
260.
Number 548
GORDON EVANS, representing the Health Insurance Association of
America (HIAA), a national trade association of commercial health
insurance companies that provide health insurance for approximately
55 million Americans, testified. He clarified HIAA does not
represent Blue Cross, AETNA, or some of the other major insurance
companies. HIAA opposes SB 260 for a number of reasons, not the
least of which is that the provisions mandate a specific coverage
of something that is not considered to be basic health care
treatment. The consequence of this mandate would be to increase
the costs of health insurance, and reduce the efficiencies of
managed care. HIAA favors the preservation of a system that allows
the prospective purchaser of health insurance free choice of which
risk he or she wishes to cover from the various coverages offered
by competing insurance carriers. HIAA also believes the choice of
how a policyholder spends what funds are available for health
insurance should be free of government decree. It continues to
oppose the proliferation of benefits through a government mandate.
The services for which coverage would be mandated by SB 260 are
generally considered to be elective services. Insurance companies
are not in the business to provide free health insurance coverage.
Anytime the government mandates specific coverage, that becomes one
of the rating factors insurance carriers then use in making
underwriting decisions. If the coverage sought by SB 260 is
mandated, premium costs will be increased even for those people who
have no use for, or do not want, the coverage. Furthermore, if
this legislation passes and coverage for contraceptive services is
mandated, this mandate would apply only to individual policies,
smaller employer group policies, and certain other group policies,
those who can least afford a premium increase. The mandate of SB
260 would not affect Alaska's largest employers: state employee
coverage, CARRS, BP, ARCO, EXXON, or the Municipality of Anchorage
because they are all self-insured and are subject to federal ERISA
law which preempts state law. He thought approaching Congress to
change ERISA would be more appropriate. He added that most of the
companies he represents do not routinely cover abortions,
vasectomies, sterilizations, and tubal ligations.
SENATOR ELLIS asked whether HIAA opposed the state mandate for
mammograms.
MR. EVANS replied HIAA opposes any mandate, but it did not go on
record last year as opposing mammograms, pap smears, prostate
coverage, etc.
SENATOR ELLIS asked if HIAA did not because it would be politically
unpopular to specify those services.
MR. EVANS said he did not know why. He was instructed to oppose
all mandates.
SENATOR ELLIS pointed out that while the state would not be
affected because it is self-insured, it has been the state's
practice to comply with legislative mandates for other carriers.
MR. EVANS thought the state considered such mandates through its
collective bargaining process.
Number 494
SENATOR ELLIS asked Mr. Evans if he agreed with the HIAA quote on
the slide.
MR. EVANS replied he cannot disagree with that statistic.
SENATOR ELLIS clarified that HIAA estimated that adding oral
contraceptives to a drug card plan would increase employee cost by
about $1.35 per month.
MR. EVANS commented if that cost was mandated, insurance carriers
would have to drop coverage elsewhere.
CHAIRMAN WILKEN questioned the disparity between benefits for males
in our society versus females. He stated he always assumed oral
contraceptives were covered under all insurance plans but found out
they are not, even when they are prescribed for purely medical
reasons other than birth control. He said he co-sponsored this
bill because he cannot understand why oral contraceptives are not
covered, especially when they are prescribed for medical reasons.
MR. EVANS responded the definition of the word "contraceptives"
leaves a bit to be desired. That definition describes
contraceptives as an appliance, a drug, or a medicinal for
preparation intended for the prevention of conception. That
definition could include a box of condoms. He suggested tightening
up the definition.
CHAIRMAN WILKEN indicated he thought a drug would be covered if it
was medically prescribed, according to the definition of health
care services.
MR. EVANS stated Section 2(a) of SB 260 mandates coverage for
contraceptives and related health care services. Medically
prescribed services would be covered under related health care
services. Contraceptives include appliances, which can cover many
things.
CHAIRMAN WILKEN said he interprets that section to mean either
would have to be prescribed or administered by a doctor, which is
his intent. He asked Mr. Evans if he could offer suggestions to
clarify that language.
SENATOR ELLIS indicated Chairman Wilken's interpretation is his
intent as well. He noted that intent was expressed to the drafter
who wrote the bill.
MR. GORDON suggested including a letter of intent to clarify the
issue.
Number 439
MIKE LESSMEIER, representing State Farm Insurance (an HIAA member),
stated State Farm is opposed to SB 260 because it mandates a
benefit which mandates a cost, and that cost is then mandated to
everyone whether or not they need the benefit. Mandating benefits
also interferes with the functioning of a system that has worked
well in the free market system based on competition. If
availability of a coverage is a true concern, mandating an offer of
that coverage is more desirable so that the people who use it are
the ones who pay for it. State Farm does not believe that relating
the issue of an unwanted pregnancy to the issue of the availability
of insurance is fair. The Legislature cannot legislate personal
responsibility. State Farm's concern about mandates does not only
relate to this issue; it relates across the board.
CHAIRMAN WILKEN asked why State Farm would oppose an increased cost
of $1.60 per month now to prevent a problem that could cost
thousands.
MR. LESSMEIER replied to begin with, he does not think the $1.60
figure is accurate. He commented if that is truly the question,
then the state should pay that increase, rather than private
individuals who have no need for the service. He repeated his
opposition to imposing that cost on everyone. He maintained it is
unfair to look at individual issues in isolation because there is
a laundry list of services many people believe are necessary and
should be covered, counseling being one. He stated the question
is, where does one draw the line because if all of them are
covered, the product will be unaffordable, which will help no one.
He repeated that if availability is the problem, mandating an offer
of availability is a better approach.
Number 386
SENATOR ELLIS indicated he agreed with Chairman Wilken that the
incremental cost of providing this coverage is tiny and that SB 260
will not mandate personal responsibility; it will enable people to
exercise personal responsibility. Asking people to bear this small
increase in policy costs is not an issue because society is bearing
the costs of unintended pregnancies now to a great extent.
MR. LESSMEIER repeated it is unfair to equate an unwanted pregnancy
to a lack of health insurance coverage for contraceptives. He
suggested looking at data from other states with similar
legislation to see if it has had any impact on unwanted
pregnancies.
Number 327
LISA BLACKER, representing herself, made the following comments.
Regarding Mr. Lessmeier's opposition to requiring all policyholders
to pay for the increased cost of contraceptive coverage, she said
she is already paying for things that go toward men's health care
coverage in her premium cost. She supports SB 260 for two primary
reasons. First, it will reduce the disparity in out-of-pocket
health care costs between men and women. Second, and more
importantly, it will help reduce the number and consequences of
unintended pregnancies. The National Academy of Sciences'
Institute of Medicine released a 1995 report stating that 50
percent of all pregnancies in the United States were unintended.
The number climbs to 60 percent among poor women; 73 percent among
never-married women; and 86 percent among unmarried teens. Such
pregnancies impose great burdens on families and societies. The
Institute of Medicine also notes that the failure to cover birth
control leads to higher costs for the insurer. Abortions, delayed
prenatal care, low birth weight, and higher infant mortality rates
are the costs associated with unintended pregnancies. Those costs
are far higher than the costs of birth control and are reflected in
the price we pay for insurance premiums now. SB 260 could play a
significant role in increasing access to more safe and effective
methods of birth control and reduce the tragic consequences of
unintended pregnancies.
Number 327
ANGELA SALERNO, representing the National Association of Social
Workers (NASW), made the following comments. NASW strongly
supports SB 260 as it will help working families access the most
effective forms of birth control so they can plan happy, healthy,
wanted families. Unintended pregnancy is an issue of basic health
care for women and families. A 1996 Institute of Medicine Report
found the contraceptive needs of a number of groups in society
remain unmet so recommended that new and improved forms of
contraception be researched and that the full range of
contraceptive products be made accessible to consumers. It further
states that, "...third party payers, who bear the cost and reap the
benefits of the health status of their covered population, include
contraception as covered service. Family planning services and the
management of sexual health should be integrated as comprehensive
reproductive health services." Ms. Salerno maintained SB 260 will
not impact those Alaskans who are wealthy and can purchase any kind
of contraception they wish. It will impact Alaska's working
families, the people who have taken personal responsibility for
themselves. It will help them plan for wanted children. NASW
believes prevention is the future of providing health care in this
country. Cost containment is an issue; prevention is the number
one method of containing cost. This type of measure will also
prevent some of the social problems experienced by the entire
community because everyone pays for unwanted pregnancies. SB 260
is about working families, prevention, social problems, and
unwanted pregnancies.
Number 288
CAREN ROBINSON, testifying on her own behalf, related her recent
experience working with a group of Close-Up students. The Close-Up
group studied SB 260, as well as companion legislation in the
House. The group had a mock committee hearing as well as a mock
legislative session. The mock committee members passed SB 260
unanimously. In the mock legislative session, SB 260 passed with
a vote of 35 to 5. Amendments containing intent language were
offered. She concluded by saying the third group of Close-Up
students supports SB 260.
SENATOR ELLIS commented a Senate version of the letter of intent
that originated in the House clarifies that the sponsor does not
intend to mandate coverage for abortions or other medicinal
preparations that affect a fertilized ovum. Also, some concern has
been expressed about teens using SB 260 to access contraceptives
without their parents' knowledge. He explained that insurance
claims require a parent's signature therefore it is very unlikely
that a child could get services without a parent's knowledge.
CHAIRMAN WILKEN asked Senator Ellis to read the letter of intent
into the record.
SENATOR ELLIS read his letter of intent to SB 260 as follows:
Contraceptive technology is constantly changing, and even
medical experts disagree on how certain methods of
contraception work. Thus, the sponsor believes it is unwise
for the legislature to dispute specific methods, but that it
is very important to clarify the intent of SB 260.
This legislation is intended to require insurance providers in
Alaska to cover contraceptives and contraceptive services.
Contraceptives have the primary purpose of, or special utility
for, preventing conception.
The sponsor intends that conception be understood as the
fertilization of an ovum.
The sponsor does not intend to require insurance coverage for
any appliance, drug or medicinal preparation (or related
health care service) the primary purpose of which is to affect
a fertilized ovum. Put more plainly, the sponsor does not
intend to mandate coverage for abortions.
There being no further testimony on SB 260, CHAIRMAN WILKEN
adjourned the Senate HESS meeting at 10:32 a.m.
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