This week we had key policy committee hearings, in advance of the end-of-the-month deadlines to pass bills.
Yesterday, in the California Assembly Health Committee, numerous key bills advanced.
Surprise Bills: Our sponsored legislation, AB533(Bonta) passed on a 17-0 vote, to prevent consumers from getting out-of-network bills when going to a in-network hospital or facility. Even when patients do the right thing and make sure to go to an in-network facility, these “surprise bills” can amount to hundreds if not thousands of dollars and put a family’s finances at risk–if not prevent lower-income patients from getting needed care. Broad support for the bill came from consumer groups like Consumers Union, labor groups, and insurers. Assemblyman Bonta recognized that all stakeholders agreed with the goal of the legislation, and promised to work with the physician groups that raised concerns, to work on an independent dispute resolution process to ensure a fair payment between the insurer and the non-contracting physician. Committee members appreciated the attempt to improve the bill, but acknowledged the need to get the consumer out of the middle of that dispute.
Other legislative updates: Other good bills passed, including AB1231(Wood) on ensuring access to specialty care in Medi-Cal through nonmedical transportation; AB176(Bonta) to get health data to be collected to capture differences within the Asian and Pacific Islander community; and AB1396(Bonta) a companion bill to a tobacco tax proposal to ensure dollars go to increase Medi-Cal access through increased provider rates.
AB68(Waldron) to provide for better access to epilepsy drugs, proceeded after being amended to not undo the Medi-Cal formulary. Another bill, AB1425(Allen) on health reimbursement accounts for small group coverage, did not proceed, opposed by both Health Access and many insurers. As Chairman Bonta noted, the bill did note fit within the regulatory regime of the Affordable Care Act, and would have conflicted with existing rating rules for small group coverage.
Prescription Drug Cost Transparency: The biggest debate was on AB463(Chiu) to get pharmaceutical manufacturers to disclose more information about the cost of developing drugs that are now costing literally thousands of dollars–including Solvaldi, the $1,000/pill Hep-C medication where the full regime is over $80,000. Assemblyman Chiu noted the broad “strange bedfellows” coalition who testified in support (leading off with Health Access), including consumer groups and insurers, nurses and hospitals, labor and Chambers of Commerce. The drug companies and allied groups were in force in opposition, raising concerns about the practicality or wisdom of revealing such information, and that some information was duplicative with already disclosed data. Many committee members spoke; some raised question about whether such disclosure requirements would discourage the development of such life-saving drugs; or how the information would be used. Assemblyman Wood called the bill “Battle of Titans.” Given the questions, Assemblyman Chiu asked for the bill to be put over until next week to give him time to possible amend the bill to address some of the issues raised.
On the same theme, today, the California Senate Health Committee, chaired by Senator Ed Hernandez, passed key transparency bills to better disclose and reveal the cost drivers in our health system, which should be important tools to reduce cost, improve quality and advance equity. Here are some reactions from Health Access, the statewide health care consumer advocacy coalition.
Cost and Quality Database: The Senator Health Committee on Wednesday passed SB26(Hernandez) to create a database of payments in our health system to better understand and address issues of cost, quality, and equity. “In our health system it’s very hard to find out how much a treatment actually costs, the quality of the care provided, or the relationship between the two. California needs more transparency in our health system, like this database, as a step toward additional reforms to minimize costs, improve quality, and reduce disparities.” said Anthony Wright, executive director, Health Access California, the statewide health care consumer advocacy coalition. “This step won’t solve all the issues in our health system, but having the data available and usable for purchasers, policymakers, and patients, could be a gamechanger like it has been in other fields from finance to politics to baseball.”
Large Group Rate Review: The Committee also passed SB546(Leno), that would extend rate review to large group health coverage. While amendments today removed “prior approval” rate regulation, the bill would still require important disclosures and require insurers to publicly justify their rates. “Under this bill, insurers offered by large employers would have to justify above-average rate increases. With overall health care costs slowing, it’s important to ask why many premiums are still going up greater than the rate of inflation in California.” said Wright. “While the Afforadable Care Act took important steps, we need greater transparency and follow-up reforms to really get a handle on health costs, and we urge state legislators to take this next step.”
Both bills move on to Senate Appropriations Committee.
Medi-Cal Rates: On the effort to restore and improve Medi-Cal rates, AB243(Hernandez) passed with broad health industry support on a bipartisan basis. A related bill, to raise the tobacco tax by $2 where much of the revenue would be dedicated to Medi-Cal, SB591(Pan), also passed earlier in the day in the Senate Government and Finance Committee.
Next week is the last week for committee hearings before the deadline.