SB 250-INS. COVERAGE: AUTISM SPECTRUM DISORDER  2:20:05 PM CHAIR DAVIS announced consideration of SB 250. She asked Representative Peterson if he would like to present the companion to SB 250, which he introduced in the House. REPRESENTATIVE PETE PETERSEN, sponsor of HB 187, encouraged the committee to ask questions of the autism experts that were online. CHAIR DAVIS said it was not her intent to move the bill today. She asked Mr. Obermeyer to present the bill. 2:22:13 PM TOM OBERMEYER, staff to Senator Davis, said he was speaking to the committee substitute (CS) for SB 250, labeled 26-LS1400\R. He read the sponsor statement into the record. [A copy is in the bill file.] He related that SB 250 mandates coverage for diagnosis and treatment of autism spectrum disorders (ASD) in any plan offered by the health care insurer. Early treatment has been shown to improve the symptoms of ASD and sometimes eliminate the need for special education for a child with ASD. This is the proper way to deal with this problem and it saves a great deal of money, Mr. Obermeyer said. MR. OBERMEYER pointed out that self-funded health plans, including the "Alaska Care" plan, would likely be exempt from the bill because they are preempted by the federal ERISA law. However, the state historically has complied with state insurance laws. The Center for Disease Control (CDC) reports that about 1 in 110 children are affected by ASDs, but it is much more prevalent among boys. This is an increase from 10 years ago, but it's unclear if this increase is due to a broader definition of ASDs, better diagnoses, or a combination. Many children who have been diagnosed go untreated because ASD often is not covered by insurance plans. The cost to families is overwhelming. MR. OBERMEYER related that the federal Autism Treatment Acceleration Act of 2009 is pending legislation and implementing SB 250 now would allow insurers and the state time to adjust to the requirements of this law. Also, he said, it would bring health care professional and jobs to the state. Since March of 2009, 11 states have passed legislation similar to SB 250 and 19 states have introduced legislation. SB 250 will significantly help the hundreds of Alaskans suffering from these disorders, he concluded. 2:29:19 PM SENATOR PASKVAN moved to adopt the proposed committee substitute (CS) for SB 250, labeled 26-LS1400\R, as the working document. There being no objection, version R was before the committee. 2:29:44 PM LORRI UNUMB, Senior Policy Advisor and Counsel, Autism Speaks, Columbia, South Carolina, said this is a national autism science, research, and advocacy organization. She informed the committee that she is a former law professor and the parent of a child with autism; she now advocates full time for children with autism and work nationwide on autism insurance reform. She noted that she would speak to the PowerPoint handout in the packets focusing on the experience in other states that have passed autism insurance reform. Slide 6 depicts a map of the U. S. showing the states that have passed autism insurance reform. At Autism Speaks they consider that 15 states have enacted meaningful reform, she said. In these states kids can get the kind and close to the amount of therapy that's been prescribed for them. Indiana and Minnesota passed legislation in 2001 so cost data is available, but it's nearly ten years old. South Carolina and Texas were the next states to pass legislation in 2007; more states followed suit in 2008 and 2009. As previously mentioned, legislation is pending in 19 states. MS. UNUMB directed attention to slide 7 that contains excerpted data from an insurance advocacy association report titled "Health Insurance Mandates in the States." It indicates that covering autism has impacted premiums by less than 1 percent. This is compared to other mandated treatments like alcoholism, contraceptives, in vitro fertilization, and prescriptions all of which are higher. Slide 8 contains actual cost data from South Carolina after the autism insurance statute became applicable to the state employee health plan in January 2009. The state has a population of 4.5 million and the state employee health plan has 350,000 members. When the legislation was introduced the state budget office initially estimated that this coverage would cost the state $18.9 million and that was later revised down to $9 million. The actual claims date for all of 2009 shows that it cost the state $856,371. This translates to a 20 cent premium increase per member per month to provide all the kids with autism in South Carolina with the coverage they need. The South Carolina statute is a little different than what SB 250 proposes because it provides coverage only through age 16 and it caps applied behavior analysis (ABA) therapy at $50,000 per year. The Harvard study indicates that the lifetime cost for each child with autism who does not get treated is $3.2 million so if you're not motivated by the human aspect, think about if from the fiscal perspective, she said. Fully 50 percent of the kids who receive treatment will go right into a mainstream first grade classroom, saving the state an awful lot of money, she concluded. 2:38:42 PM SENATOR PASKVAN asked what policy issues caused [South] Carolina to cap coverage at age 16 and $50,000. MS. UNUMB replied she selected age 16 somewhat randomly without any scientific basis. Most of the states that have reform selected age 18-22. The original legislation didn't have a therapy cap, but the insurance industry argued in favor of one on the ABA therapy because they couldn't estimate that cost. When the legislature asked her to write in a cap, she put in $75,000 because that's the cost of her son's therapy. Shortly before the bill passed the cap was negotiated down to $50,000. Slide 10 has a chart comparing the age and ABA therapy caps in six states with reform statutes. She offered to provide a chart that compares all 15 states in some detail. CHAIR DAVIS said that would be helpful. 2:42:18 PM SENATOR DYSON questioned why treatment for this disability isn't paid for out of the tax base as opposed to insurance. Here in particular it would be a very selective and disproportionate sharing of the burden. MS. UNUMB replied some states have attempted to provide coverage through the Medicaid waiver program, but it isn't sufficient to treat all the kids. Even with a very favorable 70 percent federal match, South Carolina has two to three year waiting lists of several hundred children. That doesn't do a child with autism any good because the early intervention window is critical for rewiring the brain. She added that autism is at core a medical issue and for the people who have private insurance it seems only fair that private insurance play a part. SENATOR DYSON thanked her for a thoughtful response. 2:46:24 PM SENATOR THOMAS referenced the actual 2009 cost data she provided for the South Carolina state employee plan and expressed disbelief that treatment per child could cost so little. He asked how she arrived at $856,000. MS. UNUMB said she believes that cost will rise as more people take advantage of the coverage, but she doesn't it will ever approximate the state's $9 million estimate. She referenced slide 2 showing the five pervasive developmental disorders (PPD). Within the five PDDs there are three autism spectrum disorders (ASDs): autistic disorder, Asperger's syndrome, and pervasive developmental disorder - not otherwise specified (PDD-NOS). Autistic disorder accounts for 1/3 of all ASDs, Asperger's syndrome accounts for less than 1/6 of all ASDs, and the milder PDD-NOS accounts for 1/2 of all autism spectrum disorders. The kids in the first category are severe and they are prescribed the intensive behavioral therapy. While the prevalence of PDD is 1 in 110, only 1/3 have a severe diagnosis and only some of those will be prescribed a full 40 hour per week ADA therapy program. And not all of the ones who are prescribed the intensive program will take advantage of it because it takes place in your home and is incredibly intrusive. Not every family is willing to make the lifestyle adjustments and in rural areas there may be provider issues. One reason that South Carolina's fiscal note was so far off is that the budget analyst took the prevalence number and multiplied it by the cap. They assumed that every child would be prescribed and get the maximum treatment, but it doesn't work that way. In South Carolina 62,000 kids were within the age 2-16 target range and just 64 were actually prescribed and took advantage of the therapy in 2009. SENATOR THOMAS asked if she has examples from other states that have had legislation in place for a longer period of time and why she included a slide that lists businesses that have self- funded ERISA plans. 2:53:07 PM MS. UNUMB said it's difficult to get detailed data because private insurers are less forthcoming, but she does have data from Minnesota. That benefit has neither an age nor a dollar cap and it's been in effect for nine years. Blue Cross/Blue Shield said that the average utilization on an ABA program was $30,000 per year and the premium increase has been $.83 per member per month. She noted that Autism Speaks hired an independent actuary to conduct an analysis on the companion bill to SB 250 and he projected a cost of $1.34 per member per month. She explained that she included the information on the ERISA plans because she likes to point out that when a state chooses to mandate a benefit many ERISA regulated plans voluntarily follow suit. The slide offers a small list of companies that have elected to provide an autism benefit. She believes that the Microsoft administrator is Premera Blue Cross Blue Shield and she understands they are a predominant insurer in Alaska. SENATOR PASKVAN asked if there's a rational explanation for some states placing a different dollar cap on therapy based on age. MS. UNUMB replied they're the result of a political process. Some states have decided that kids don't need as much treatment once they enter school and that might be true depending on severity. 2:57:28 PM SHEELA TALLMAN, Legislative Affairs, Premera Blue Cross Blue Shield of Alaska, confirmed that this legislation will not impact self-funded plans, which are subject to ERISA and it's not subject to state mandates. However, the bill will impact the 40 percent of the market that represents individuals and small employers in Alaska that are already price stressed. It imposes a mandate on health insurers like Blue Cross by requiring all policies to include coverage for ASDs including social skills- based therapies that generally considered outside the realm of health care. They estimate that this mandate could increase health insurance premiums up to 3 percent so it's not cost free. 2:59:15 PM SENATOR PASKVAN asked if she disputes the estimated $1.34 per person per month premium increase. MS. TALLMAN replied they believe it will be slightly higher but she doesn't have the exact number. SENATOR PASKVAN asked if the premium would likely be lower if it were spread over a larger population base. MS. TALLMAN replied their calculations already include the small and large groups of insured. CHAIR DAVIS asked if she could meet with the committee again and provide the additional information. MS. TALLMAN agreed to do so. CHAIR DAVIS held SB 250 in committee.