SB 82-INSURANCE COVERAGE FOR CONTRACEPTIVES CHAIRMAN MILLER called the Senate Health, Education and Social Services (HESS) Committee to order at 1:40 p.m. and brought up SB 82. SENATOR GARY WILKEN, presented his sponsor statement on SB 82 which requires insurance carriers to provide coverage for prescribed contraceptives and related health costs. While many health care plans pay for surgical means of preventing pregnancy, few pay for the routine oral contraceptive methods prescribed and recommended by physicians. Women spend about 68% more out-of-pocket costs for health care than men. One of the biggest contributors to those expenses is birth control. The most widely used prescription drug of women aged 15 to 54 is for birth control, yet most insurance companies do not include contraceptive coverage in their policies. The out-of-pocket cost for oral contraceptives is about $25 per month while the estimated increase in insurance premiums for coverage for birth control is about $16 annually per enrollee, according to the Health Insurance Association of America. Requiring insurance coverage for contraceptive services not only makes good business sense, but it also increases access to contraceptives and related services. In response to a person's conscientious objection to contraceptive coverage, SB 82 states an individual health care insurance policy or a policy issued by a qualified church-controlled organization with a religious-based objection is exempted from this mandate. Eight out of ten privately insured adults support contraceptive coverage. SENATOR WILKEN concluded, SB 82 recognizes this strong public support, and he urged the committee's support for this legislation. Number 046 SENATOR WILKEN commented that people will point out the increased cost of $16 for this coverage, but the cost is much more for unwanted pregnancies and the problems caused by unwanted pregnancies. This is an investment that over time pays back, and the cost of insurance over time will decrease because of this bill. On a personal note, SENATOR WILKEN related that he became involved in this issue when his daughter, an active high school junior needed oral contraceptives, not for birth control but to regulate female hormones so that she could basketball. He said, "You can imagine when my wife said to me, 'Gary, I think we need to put Karen on birth control pills' what I said... a junior in high school." After the reasons were explained to him, his daughter went on birth control pills and is an active college basketball player today. The birth control pill began as a medicinal device for birth control and it's evolved into a significant therapy to control female hormones. He referred to pages 3-4 of the committee packets containing quotes of support from organizations, and studies speaking to the benefits of contraceptive coverage. SENATOR WILKEN brought up the draft CS and a draft Amendment Version H. He moved that the committee adopt the CS as a working document. Without objection, the CS was adopted. SENATOR WILKEN explained the CS, Version H, does two things. Last year in similar legislation the intent language addressed the primary purpose of contraceptives in preventing conception. This CS rolls that purpose, which gave a lot of people comfort, into the legislation itself. Secondly, the CS cleans up the bill by removing the definition of contraceptive device and adding the words "obtained by prescription" to clarify that only contraceptives obtained through a doctor's prescription are covered by this insurance. Number 107 CHAIRMAN MILLER announced that following testimony on SB 82, many people want to speak on SB 94, and he set a 2-minute time limit on testimony on both bills. MS. THEDA PITTMAN, Anchorage, thanked Senator Wilken for introducing SB 82 and urged co-sponsorship and support by the committee members. She stated that according to DHSS, there were over 10,000 births in Alaska in 1995 and 41% were unintended, unwanted or mis-timed. In 1995 alone there were 4,000 reasons why this legislation is a good idea. She suggested that two groups oppose this idea, the insurance companies and members of the "far- righteous groups" that seek to control the right of a woman to make her own decision about pregnancy. MS. CATHY GIRARD, Anchorage, expressed support for SB 82. She stated her medical bills over 10 years for prescription contraceptives and related medical exams have not been reimbursed by her insurance plan or her husband's. She asked why Viagra, a sexual aid for men, is covered by both their insurance policies and yet contraception, primarily made for and purchased by women is not covered by current insurance programs. MS. MARY ROSS, Nurse-Midwife representing the Chapter of the American College of Nurse Midwives, Anchorage, expressed support for SB 82 as a practitioner for women's health care. Many women up to the age of 52 use birth control as a supportive measure during the perimenopausal and menopausal times. MS. ROBIN SMITH, Anchorage, spoke in strong support of SB 82, stating insurance coverage for contraceptive care would be a good business decision. Recently four of her employees, both male and female, have dealt with unintended pregnancies, causing emotional stress and negative impacts on her business including lost employee time. increased work loads on others, re-hires and re-training. Small business cannot dictate special insurance coverage for employees, and must choose a package that does not include birth control coverage in Alaska. Rectifying this inequity in health care for women will establish a more stable work force and stronger, healthier families. MR. CHARLES MCKEE, Anchorage, stated he thought it was mandatory insurance coverage for all individuals in the state of Alaska. Number 260 MR. SCOTT CALDER, Fairbanks, referred to the language on page 2, Section 3, line 6 "except for a policy issued to an individual or a qualified church-controlled organization," and "qualified church- controlled organization" on page 2, lines 15-16, defined under 26 U.S.C. 3121(w)(3). He asked why the focus is on a religious-based organization when 'fraternal benefit society' is not included in this section, which he found referenced in Sec. 21.42.390. MS. KAY LAHDENPERA, Public Health Nurse representing the Alaska Nurses Association, applauded the committee for SB 82, which "is terribly important to reduce unintended pregnancies." There are about 6 million unintended pregnancies nationally every year. Women must have the opportunity to plan their families and get coverage for this $25-$35 per month expense. The National Commission to Prevent Infant Mortality estimates infant death could be reduced by 10% and incidence of low birth weight babies reduced by 12% if pregnancies were planned. Number 312 MR. GORDON EVANS, representing the Health Insurance Association of America (HIAA), a national trade association of commercial health insurance companies, stated HIAA opposes SB 82 as presently written. Its provisions mandate coverage for contraceptives, which is not considered to be basic health care treatment, and the consequences in the long run would be to increase the costs and reduce the efficiencies of managed care. As noted previously, the HIAA favors the preservation of a system that allows the prospective purchaser of health insurance free choice of which risks he or she wishes to cover from among the various coverages offered by competing insurance carriers. The HIAA also believes that the choice of how the policy holder spends the funds available for health insurance should be free of government decree. Any time government mandates certain coverage, that mandate becomes one of the rating factors which insurance companies use in making their underwriting decisions. Premium costs would be increased, even for those people who have no use for or do not want the coverage. MR. EVANS continued, this mandate would apply only to small employer group policies and certain other group policies who generally can least afford a premium increase. The mandate would not affect Alaska's largest employers such as Carrs, BP, ARCO, or EXXON which are self-insured and subject to federal ARISA law which pre-empts state law. The mandate also would not affect those with federal insurance coverage such as the Indian Health Service. Technically, it wouldn't affect the state employees. Senator Wilken noted a $16 cost; however, MR. EVANS felt the figure is misleading because it covers only the cost of contraceptive drugs like birth control pills. It does not include contraceptive devices or appliances like IUDs, or the cost of related health care services. HIAA would not be opposed to a mandate to offer coverage for contraceptives and related health care services. As a result, policy holders - employers and their employees - would be able to choose whether to spend additional funds on this type of coverage. They, and not the insured population in general, would pay the cost of that coverage. Substituting the word "offer" for the word "provide" on page 1, line 10 of original draft would make the coverage sought as a mandated offering. MR. EVANS suggested this would accomplish the purposes of the bill's proponents. Referring to the adopted draft CS, HIAA opposes favoring a specific group, as in the language "a qualified church-controlled organization" because it gives persons of one religion a preference over other groups who also may not want the coverage but will have to take and pay for it. MR. EVANS said it should be an "all or nothing bill." Number 371 SENATOR ELTON asked if Mr. Evans' testimony that emphasized the cost that will be spread to all policy holders, disputes the sponsor's claim that the contraceptive health coverage would save money by not incurring additional medical expenses with unwanted pregnancies or problem pregnancies. MR. EVANS replied that is the HIAA position. SENATOR WILKEN responded that in the testimony in U.S. Congress on the recently passed Equity in Prescription Insurance and Contraceptive Coverage Act, the president of the organization said "we oppose mandates but we're not going to spend a dime fighting this." He continued, noting for the record that the total dollars spent per employee is $17.12 on all contraceptive devices including oral, diaphragms, cervical caps, injectables, implants and IUDs. Of that figure, $16.13 or almost 95% is spent on oral contraceptives. MR. EVANS countered that the memo provided to him last session by Senator Ellis stated oral contraceptives cost on average $25 per month. Number 400 MS. BECKA BRAUN expressed support for SB 82. She described it as a "win/win" proposition because it would reduce the number of unintended pregnancies. According to several studies, half of unintended pregnancies end in abortion in this country. Those who support choice and those who oppose abortion can all agree that reducing the number of abortions is a good thing, and making contraceptives more widely available is one very smart way to do that. Studies show that as the availability of contraceptives increases, the number of legal and illegal abortions decreases. Those unintended pregnancies that go to full term have costly effects for society and for the state. There's a much higher pregnancy rate with cheap contraceptives, such as condom failure. These are the methods most affordable to women. It doesn't make sense to exclude contraception, the only FDA-approved prescription drug regularly excluded by insurers. It's not included on the list of "basic health care" but MS. BRAUN said she's not sure what basic health care entails, when Viagra is covered. Insurer costs should not rise by more than 1% under this proposed mandate. She urged the committee's support of SB 82. SENATOR WILKEN moved the draft Amendment Version H.1 by Ford 3/24. The text follows. Page 2, lines 6-7: Delete "for a policy issued to an individual or a qualified church-controlled organization with a religious-based objection" Insert "as provided in (b) of this section" Page 2, following line 11: Insert a new subsection to read: "(b) This section does not apply to a policy (1) issued to an individual; (2) issued to a qualified church-controlled organization with a religious-based objection to contraceptives; or (3) that does not provide coverage for drugs obtained by prescription." Reletter the following subsection accordingly. SENATOR WILKEN explained that it inserts a provision that if a policy is in place by an employer that does not offer coverage for prescription drugs, this legislation would not impose upon the employer the requirement that they now offer prescription coverage. If they did have prescription coverage, contraceptive prescription coverage would be included. Number 446 SENATOR ELTON objected to adopting the amendment for the purpose of discussion. He pointed out on line 8 of the amendment, it provides that this section does not apply to a policy "issued to an individual." The previous language has been removed that said "issued to an individual with a religious objection." He asked if this means that only insurance policies that are group insurance policies would now be affected. SENATOR WILKEN replied he put it in at the request of Blue Cross. He admitted he did not know why that change was made. CHAIRMAN MILLER followed up, asking if this language just deals with those companies that do not offer the coverage, that being the original understanding of the amendment. SENATOR ELTON replied, and CHAIRMAN MILLER agreed, that this section outlines the exceptions. This broadens the exception that had formerly applied to an individual, now including any policy written to an individual. SENATOR WILKEN stated his staff told him that language was in last year's bill. MR. EVANS said the way he reads the draft CS with the draft amendment, this bill would exempt individual policies; it would exempt policies issued to church-controlled organizations; and it would exempt any group policies that do not provide coverage for drugs obtained by prescription. On the other hand, the CS on page 2, line 5-6 says "except for a policy issued to an individual or a qualified church-controlled organization with a religious-based objection." CHAIRMAN MILLER followed up, asking if the language is because an individual who decides he doesn't want this coverage may be mandated by law to take the coverage anyway. MS. MARIANNE BURKE, Director of the Division of Insurance, stated Chairman Miller is correct. Individual policies are individually underwritten, and (Chairman Miller) would probably not want a policy that covered oral contraceptives. CHAIRMAN MILLER asked for objection to adopting the amendment. Hearing none, the amendment was adopted. He asked the sponsor if the bill covers contraceptives prior to conception but not after conception, such as the RU 486 drug. He said that question will come up on the Senate floor. SENATOR WILKEN replied post-conception prescriptions are not part of this legislation. The intent language from last year's bill was incorporated into the CS on page 2, lines 1-2 and states "insurance providers not be required to cover the cost of prescriptive drugs necessary to cause the rejection of a fertilized ovum." The intent of the bill addresses pre-conception. Number 505 SENATOR KELLY stated "that may be the bill's intent, but with our Judiciary, I'm sure somebody's going to take the right to privacy clause of the Constitution and require that you include RU 486 or something like that...I think you'll probably find that there will be a lawsuit on that." He said he's not a big fan of the bill, and he doesn't feel the Legislature has any business telling insurance companies that they have to do this. Contraceptives are widely available, and this asks insurance companies to cover those who choose more expensive methods than condoms. It doesn't require legislation. It encourages people to go toward oral contraceptives which have no value in prevention of sexually-transmitted diseases (STDs). He asked, would there be unintended health consequences as a result of this? Are we putting a burden on private industry? Those are his biggest objections to this bill. SENATOR WILKEN said he appreciated Senator Kelly's comments. He doesn't have data on STDs. He wants to see mandated coverage happen sooner because the cost of insurance will go down. It's an issue of equity and of money. Some women can't afford the contraception they need, and he suggested that those are the pregnancies that should be most controlled. While there is a rackful of inexpensive male contraceptives available, there is not a rack of female contraceptives, and this limits a couple's ability to plan and time their childbearing. This legislation is a tool that could benefit society. SENATOR WILKEN said he cannot understand why it's taken so long to get us to where we are today. It's an investment in lowering costs, and an investment in society, and it gives us more options to plan our lives. If the industry doesn't want to do it, then this bill will encourage them to do it, and he said he's pleased to do that. Number 540 CHAIRMAN MILLER said that, like Senator Kelly, he's not necessarily a big fan of the bill, but he is willing to be democratic and let the will of the committee prevail. He asked for a motion. SENATOR ELTON expressed appreciation for the work of the sponsor to bring the legislation this far, and said he looks forward to it being on the Floor. SENATOR WILKEN moved to report CSSB 82(HES) out of committee with individual recommendations and indeterminate fiscal note. CHAIRMAN MILLER asked for objection. Senator Kelly objected and the roll was called, with Senators Wilken, Peace and Elton voting "yea," and Senators Kelly and Miller voting "nay." CSSB 82(HES) passed out on a 3-2 motion.