SENATE BILL NO. 10 "An Act requiring health care insurers to provide insurance coverage for medical care received by a patient during certain approved clinical trials designed to test and improve prevention, diagnosis, treatment, or palliation of cancer; directing the Department of Health and Social Services to provide Medicaid services to persons who participate in those clinical trials; relating to experimental procedures under a state plan offered by the Comprehensive Health Insurance Association; and providing for an effective date." 5:17:24 PM TOM OBERMEYER, STAFF, SENATOR BETTYE DAVIS, SPONSOR explained that the legislation requires health insurance providers in Alaska cover the costs of routine care, incurred to a patient participating in an approved clinical trial relating to cancer. He expounded that the insurer is required to provide coverage only if the patients physician determines there are no superior existing treatments available and the pre-clinical data shows a reasonable expectation that the clinical (investigative) treatment is as efficacious as conventional therapy. Mr. Obermeyer then read from the Sponsor Statement (Copy on File): Clinical trials are research studies that test how well new medical approaches work in patients. Each study answers scientific questions and tries to find better ways to prevent, screen for, diagnose, or treat disease. Patients who take part in cancer clinical trials have an opportunity to contribute to the knowledge of, and progress against cancer. They also receive state-of-the art treatment from experts in the field. The National Cancer Institute, as part of the U.S. National Institutes of Health, reports 6,000 cancer trials in the United States any one time. They include trials in prevention, screening, diagnosis, treatment, quality-of-life, and genetic studies.   CSSB 10 removes important barriers to the participation of patients in cancer clinical trials in Alaska. It requires that applicable health care plans, including Medicaid, cover routine patient care costs for patients enrolled in all phases of clinical trials, including prevention, detection, treatment, and palliation (supportive care) of cancer. Currently Alaska health plans may exclude coverage for routine patient-care costs while a patient with cancer is enrolled in a clinical trial. Providers of health care plans often conclude that money is saved by excluding care while patients participate in clinical trials. But these patients, if not enrolled in clinical trials, will continue to receive conventional therapy at roughly the same or slightly increased costs in the short-run.   Over 2600 Alaskans are diagnosed with cancer each year. In FY 2007 an estimated 4,600 patients received cancer treatments through Alaska's Medicaid program at a cost of $21.5 million. The average payment per beneficiary was about $4,675. The federal government reimburses the state at about 50% of the total costs. Without in-state facilities and support of clinical trials participants in Alaska currently have to travel out of state, increasing the cost of non-emergency transportation which is about 3% of total Medicaid costs.   Studies have shown that only 2% to 3% of adult cancer patients and less than 0.5% Medicare patients enroll in clinical trials of the approximately 20% who are eligible -largely due to fear of denial of insurance.  A recent study found only slight increase in treatment costs for adult clinical trial patients compared to nonparticipants, $35,418 versus $33,248 or about 6.5% increase in costs for clinical trial participants compared to nonparticipants. Even if enrollment was increased to the full 20%, it is unlikely that these numbers will significantly impact overall costs to health plans. See National Conference of State Legislatures, "Clinical Trials: What are States Doing? February, 2009 Update:" www.ncsl.org/programs/health/clinicaltrials.htm. Twenty-three or more states have passed legislation or instituted special agreements requiring health plans to pay the cost of routine medical care patients receive while participating in clinical trials. Passage of CSSB 10 will result in more successful outcomes in cancer treatments in Alaska, increase retention of patients in Alaska for their cancer care, and also, after full implementation, result in cost savings in the short and long term. A description of "The Access to Cancer Clinical Trials th Act of 2009" H.R. 716, 111 Congress 2009-2010, (Rep. Sue Myrick) per "The Hill's Congress Blog" January 30, 2009 sums up to a large extent what CSSB 10 is attempting to do: Clinical trials are so critical for patients and or medical research, yet many patients find that their health insurance won't cover the rest of their routine cancer treatment if they decide to enroll in clinical trials. We're not asking insurance companies to pay for clinical trials. This bill simply states that insurers must continue to pay for routine treatments - that they would be paying for regardless - if patients enroll in a clinical trial. No patient should ever have to fear exploring all treatment options at the cost of losing coverage. We should be encouraging participation in clinical trials, not discouraging it by removing coverage for routine care. Were it not for patients who have enrolled in past trials, the medial advancements we've experienced toward finding a cure for cancer would not be possible. 5:23:29 PM Mr. Obermeyer noted that there are two zero fiscal notes; Department of Commerce, Community and Economic Development and Department of Health and Social Services. Senator Olson wondered who besides a university is carrying out these clinical trials. Mr. Obermeyer stated he was not able to answer. He offered that the trials must be approved by agencies like the National Institute of Health or the Department of Defense and are held to defined standards. Senator Olson asked why an insurer would refuse to cover costs if the clinical trials are funded by a university. Mr. Obermeyer clarified that the clinical trial costs are paid for by the research entity conducting the trial. He stated that this legislation would ensure that associated medical costs to the patient are covered. An example would be a follow up visit with the patient's own oncologist. Senator Thomas asked if the bill provides coverage for all stages of the clinical trial. Mr. Obermeyer affirmed. Senator Thomas noted that the bill does not require the insurer to pay for charges that would not be covered if no insurance existed or otherwise reimbursable charges. 5:25:55 PM Co-Chair Hoffman stated that he provides health care coverage for his employees in his personal business. He addressed concern about the rising costs of premiums. He cited a letter from Premera (copy on file) dated April 7th that states concerns that the legislation would force a premium increase for small group and individual policyholders. He asked about keeping the premium costs down for providers. Mr. Obermeyer responded that overall cost may not be that great. He related that presently cancer patients needing treatment are getting their routine treatments covered by their insurance provider. Insurers might realize a cost savings by allowing patients participation in trials. Routine follow up care is required regardless of whether a patient participates in a trial or not. He summized that SB 10 requires that routine follow up care charges will be covered if a patient chooses to participate in a clinical trial and the trial will not be considered experimental by the insurer. He felt passage of the legislation was in the best interest of the patient and advancement of medicine. 5:29:38 PM SENATOR BETTYE DAVIS, responded to Co-Chair Hoffman's question. She affirmed that she had been contacted by Premera stating their concerns that not all phases of a clinical trial be covered [phases 1 and 4]. She emphasized that based on doctor's testimony in the Senate Health Social Services committee from around the state they determined that all phases are important and that their costs are being overstated by insurers. She qualified that Premera did not enter into a constructive dialogue with her office regarding the legislation except to recommend the exclusion of those two phases. Co-Chair Stedman asked if the legislation has an impact on state employees. Senator Davis answered that it has no impact on state employee plans. She explained that when state employee plans come up for review in July they may opt in to new programs. th Co-Chair Hoffman cited the Premera letter of April 7, 2009. He reported that Premera's concerns are for treatment efficacy and patient safety. Mr. Obermeyer spoke to the concerns raised in the Premera th letter dated April 7, for mandatory coverage for phases one and four. He pointed out that in phase one trials are offered to a very limited number of participants. The medications administered are done typically to determine safe dosage levels. Many of the drugs administered are approved by the FDA. He stated that phase four trials generally involve follow up paid for by the pharmaceutical firms to determine the efficacy of the treatment. He concluded that given the small number of participants any added expense to insurers would be minimal. He reminded the committee that oncologists advised extending insurance coverage to all phases of the trial. They agreed it would be in the best interest of the patient and based on their experience additional cost is minimal. 5:33:31 PM Co-Chair Stedman referred to page 2, line 29 and asked for clarification. He wondered if this alluded to experimental treatments received in phase one trials. Mr. Obermeyer pointed out that the section, starting on line 27, describes exclusions to the bill. Co-Chair Stedman stated that he was under the impression that all phase one trials are experimental. Mr. Obermeyer reiterated that many drugs used in phase one trials already have FDA approval. He exemplified that in one trial an approved drug for colon cancer was administered to a brain cancer patient with positive results. Senator Olson asked if stem cell research is included in this bill. 5:35:57 PM Mr. Obermeyer believed it was not. Senator Huggins cited a letter from the NFIB dated January th 20, (copy on file) that the legislation excludes state employee plans. He opined that if it excludes government plans it does not provide a level playing field. Senator Davis asserted that the bill will require Medicaid to provide coverage but does not mandate the state to participate. She reasoned that the state might opt in because it is in the best interest of the employees. 5:38:25 PM DR. JEANIE ANDERSON, KATMAI ONCOLOGY (via teleconference), testified in support of the legislation. She clarified an earlier discussion regarding clinical trial settings. She said that most of the clinical trials in Alaska are also open to participants throughout the country in university and community institutions. All of these institutions require that the routine medical costs are covered by the patient's insurer. This is care the patient would receive regardless of whether one is a participant in a study or not. Dr. Anderson noted that Medicare has included coverage for clinical trial participation since 2000. She countered the concerns raised by Blue Cross/Blue Shield by asserting that patient safety and efficacy of treatment is maximized by patient participation in clinical trials without any significant cost increase. The medical community benefits by maximizing cancer treatment knowledge without increasing costs. She included details in previous written testimony. [Testimony on SB 280, from 4/3/08 was provided to the committee by Senator Davis (copy in file).] 5:41:48 PM SHIELA TALLMAN, PREMERA BLUE CROSS/BLUE SHIELD OF ALASKA (via teleconference), testified in opposition to the legislation. She referenced the letter of April 7, 2009 to the committee and reiterated Premera's concerns mandating phases one and four of clinical trials. She considered phase one trials experimental and questioned whether all policy holders should be funding basic development of these drugs, devices and procedures for the manufacturer. Patient safety must also be considered. In phase four trials, Premera would cover medically necessary treatment only if existing medical treatments are not determined more effective. She surmised that mandates can increase the cost of health insurance. Specific costs will be difficult to project in this instance. 5:45:29 PM HANNA SMITH, CANCER RESEARCH REGISTERED NURSE, FAIRBANKS (via teleconference) testified in support of the legislation. She recounted an experience with her hospital's participation in a clinical trial deemed beneficial for a patient. She asserted that the administrative costs incurred to appeal the patient's four previous denials by the insurer was the only related cost increase. It cost the insurer substantially less to cover the patient as part of the trial. 5:49:05 PM DR. MARY STEWART, MEDICAL ONCOLOGIST, PRESIDENT, DENALI ONCOLOGY GROUP, ANCHORAGE (via teleconference), spoke in support of SB 10. She echoed the importance and benefits of phase one and four clinical trials, especially the knowledge gained by the medical oncology community for new and more effective beneficial cancer treatments. She emphasized that trials do not cost more. 5:51:45 PM EMILY NENON, ALASKA GOVERNMENT RELATIONS DIRECTOR, AMERICAN CANCER SOCIETY CANCER ACTION NETWORK (via teleconference), stated support for the legislation. Ms Nenon cited a paper, submitted by The American Cancer Society (ACS) (copy on file). The paper compiled results that determine costs associated with routine cancer care provided in a clinical study are comparable to the costs of standard care. She emphasized the importance of covering all phases of the trial treatment. She believed the legislation would protect patients while maintaining access to insurance and quality care. 5:57:01 PM AT EASE 5:57:11 PM RECONVENED DR. LATHASUBARIAN, MEDICAL ONCOLOGIST, ANCHORAGE, SELF (via teleconference), testified in support of SB 10. She emphasized that insurers have been a barrier to patient's participation in clinical trials. She asserted the necessity of clinical trials in cancer research as the only way to develop new lifesaving or life extending therapies. She concluded that the medical and societal benefits of the research and care advancements discovered in clinical trials are immeasurable. 6:01:24 PM PAT LUBY, ADVOCACY DIRECTOR, ALASKA ASSOCIATION OF RETIRED PERSONS (AARP), ANCHORAGE (via teleconference), testified in support of SB 10. Mr. Luby pointed out that if patients pay health insurance premiums they should have the right to the coverage paid for that includes routine cancer care. 6:02:53 PM LINDA HALL, DIRECTOR, DIVISION OF INSURANCE, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT, spoke specifically to the issue of mandated programs and the costs associated with mandates. Ms. Hall stated she did not know what the cost of the program would be for health care insurers. She noted with regards to the zero fiscal note for the Division of Insurance (FN 2) that it is only a reflection of their administrative costs. She suggested the committee analyze the benefit of the mandate and segment of the population being served in relation to any increase in premium costs. Ms. Hall referred to a pie chart, "Health Coverage of Alaska's Population" (copy on file) and noted the 32% unregulated segment. She reiterated that this legislation would only impact the individual and small group rate payers reflected mostly in this group. The small group segment consists of small private sector employers who are likely to drop employee health coverage as premium costs rise. She concluded by suggesting the committee examine the broader picture of who the mandate benefits and what segment of the population bears the cost. 6:07:57 PM Senator Ellis queried about the logic of a cancer victim requesting participation in a clinical trial but being denied payment for routine treatments by the insurance company even if it is cost effective to the insurer. Ms. Hall conjectured that there may have been costs beyond the routine care being offered. She contended that she can not explain insurance company logic. Senator Ellis restated his earlier point and alleged that the insurer was acting unethically. Ms. Hall stated that different insurance companies have different coverage forms particularly for individuals and small groups that potentially contain adverse selection. She pointed out that Alaska's statutes provide for oversight and review. If a procedure or trial is not covered, it has a specific exclusion and contractual provision known in advance. 6:11:56 PM Senator Ellis argued that he would have been reluctant to support the legislation if it mandated coverage for experimental procedures with extravagant associated costs. He emphasized that the bill requires coverage for routine care that the patient is entitled to and has paid for in their premiums and that the insurer's payment denials are indefensible. th Senator Huggins referred to the January 20 letter stating that the legislation is a mandate to small business and not to programs provided by the state. He asked Ms. Hall if this was accurate. Ms. Hall affirmed. Senator Huggins wondered why the legislation is not a mandate to all state plans. Ms. Hall responded that the state plan is not considered insurance and is not regulated by the Division of Insurance. She explained that the mandate in the legislation is specific to Title 21 oversight, which has no regulatory authority over the various state plans. She pointed out that the legislature and or collective bargaining units could choose to include coverage of the mandate in the select benefits section of the state's plans. 6:14:46 PM Senator Olson referred to cancer treatment and the three common treatments: chemotherapy, surgical, and radiation. He asked if the plan covers all three. Senator Davis replied that she did not know the answer. She shared that the bill has circulated through the legislature for three years. She felt that participation in these programs is very important and lifesaving. She felt that the bill has been thoroughly vetted from the health and insurers' standpoint and determined cost is minimal to the insurer. She asked for the Committee's consideration of SB 10 in a timely manner. SB 10 was HEARD and HELD in Committee for further consideration. 6:19:37 PM AT EASE 6:27:43 PM RECONVENED