California Department of Insurance is Potentially Impacted by Package of Bills Which Propose Additional Medical Insurance Coverage Requirements for Mental Health and Substance Abuse Treatment

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By Brittany Hodgson

On January 14, 2020, California Senators introduced two bills, both sponsored by the Kennedy Forum and Steinberg Institute, aimed at improving patient access to mental health and substance use disorder treatment:

SB 854 (Beall), as introduced, would add section 10144.42 to the Insurance Code to require that an insurance plan providing prescription drugs for the treatment of substance use disorders place all prescription medications approved by the United States Food and Drug Administration (FDA) on the lowest cost-sharing tier of the drug formulary developed and maintained by the plan. Under the bill, insurers would be prohibited from (1) imposing any prior authorization requirements on any FDA-approved prescription medication for the treatment of substance use disorders, or on any behavioral, cognitive, or mental health services prescribed in conjunction with that medication for the purpose of treating a substance use disorder; (2) imposing requirements that the insured receive coverage at an outpatient facility; (3) imposing any requirement related to an insured’s prior success or failure with substance use disorder treatment; (4) imposing any step therapy (protocol or program that establishes the specific sequence that prescription drugs for a medical condition) requirements before authorizing coverage for a prescription medication approved by the FDA for the treatment of substance use disorders; or (5) excluding coverage for any prescription medication approved by the FDA for the treatment of substance use disorders and any associated counseling on the grounds that those medications and services were court-ordered.  According to the author, “Mental health parity is an empty promise if people struggling with addiction can’t get effective treatment.”

SB 855 (Wiener), as introduced, would repeal and add section 10144.5 to the Insurance Code to require that every health insurance policy issued, amended, or renewed after January 1, 2021, provide coverage for the diagnosis and “medically necessary” treatment of mental health and substance use disorders. The bill would define “medically necessary” treatment of a disorder as a covered service that is recommended by the patient’s treatment provider and furnished in the manner and setting that can most effectively and comprehensively address the patient’s conditions. The bill would further specify that the t necessary treatment must be provided in sufficient amount, duration, and scope to (1) prevent, diagnose, or treat a disorder, (2) minimize the progression of a disorder or its symptoms, (3) achieve age-appropriate growth and development, (4) minimize the progression of disability, or (4) attain, maintain, regain, or maximize full functional capacity. A health insurer shall not limit benefits or coverage for chronic or pervasive mental health and substance use disorders to short-term or acute treatment.

The authors and advocates for these bills say that existing law does not do enough to ensure Californians get timely and comprehensive care for mental health conditions. In a press release, Senator Wiener said, “SB 855 is a big step toward ensuring that in California, mental health is taken as seriously as physical health. We must de-stigmatize mental health and substance use disorders and help people get the care they need. It’s time for insurance companies to fully cover this essential treatment.”

Both bills are currently pending in the Senate Health Committee and are scheduled for hearing on April 15, 2020. To comment, register on the legislature’s website, and submit your comments to the authors.

 

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