July 6, 2010
INSURANCE COVERAGE FOR PROTEIN MODIFIED FOOD PRODUCTS AND OTHER NUTRITIONAL FORMULAS
By: Janet L. Kaminski Leduc, Senior Legislative Attorney
You asked for the history of CGS § 38a-518c, which requires health insurance coverage for protein modified food products and other nutritional formulas.
CGS § 38a-518c was originally enacted in 1997 as Public Act (PA) 97-167. The act requires health insurance policies to cover amino acid modified preparations and low-protein modified food products for treating inherited metabolic diseases, if these products are prescribed and administered under a physician's direction.
The law has been modified three times since it was enacted. PA 01-101 requires insurance coverage for specialized nutritional formula for children up to age three. PA 04-173 (1) expands the definition of “inherited metabolic disease” to include cystic fibrosis; (2) expands coverage of specialized formulas to children up to age eight, instead of age three; and (3) requires the coverage for the food products and specialized formulas to be on the same basis as outpatient prescription drugs. PA 07-197 further expands coverage of specialized formulas to children up to age 12, instead of age eight.
Proponents of the acts, primarily health care providers and parents, explained the need for, high cost of, and lack of insurance coverage for special prescription food and formulas for people with inherited metabolic diseases, including phenylketonuria (PKU) and cystic fibrosis. Insurance industry, Connecticut Business and Industry Association (CBIA), and chambers of commerce representatives opposed expanding the original law, saying the expansions would increase insurance costs.
Each act enjoyed overwhelming support in the House and Senate, as demonstrated by the wide vote margins. In the floor debates, legislators voiced limited opposition, noting that insurance mandates (1) only affect certain insurance plans and (2) cause premiums to increase.
PUBLIC ACT 97-167
The Public Health Committee raised HB 7040, An Act Concerning Health Insurance Coverage for Protein Modified Foods, in February 1997 and held a public hearing on the bill on March 25, 1997.
Parents and health care providers spoke in favor of the bill, explaining the need for special low-protein food for people with inherited metabolic diseases, such as PKU, who cannot digest protein. They noted that (1) insurance policies did not provide coverage for the food products, which are available only by prescription; (2) without continuous and consistent treatment, inherited metabolic diseases can lead to irreversible mental retardation; and (3) with appropriate treatment, an affected child can expect normal development and a normal life span. According to Dr. Robert Greenstein, then Director of UConn Health Center's Division of Human Genetics, the cost of the food products in 1997 ranged from $2,500 to $4,000 a year per child.
On April 3, 1997, the committee reported a substitute bill, which required individual and group health insurance policies to cover medical foods and low-protein modified food products for the treatment of inherited metabolic diseases, if these products are medically necessary and administered under a physician's direction. It defined “inherited metabolic disease” as a disease for which newborn screening is required under public health law.
The House referred the bill to the Insurance and Real Estate Committee, which favorably reported it on May 6, 1997.
The House amended the bill by (1) substituting the term “amino acid modified preparation” for “medical foods,” (2) eliminating language requiring the food products be medically necessary, and (3) specifying that the food products must be prescribed by physicians.
Representative Anne McDonald summarized the bill, saying it was meant to require insurance companies to cover prescription protein modified food for people with PKU, including children and adults. She said the amendment restricted the language of the bill to apply to people with inherited metabolic diseases who cannot digest protein, rather than requiring coverage for all medical food. In response to a question from Representative Thomas Herlihy, she clarified that milk and eggs would not be covered foods under the bill. Representative Lenny Winkler asked if the food products covered by the bill required a prescription. Representative McDonald confirmed that a prescription is required.
The House passed the amended bill on May 13, 1997 by a vote of 137 to six.
The Senate took up the bill on May 28, 1997. In bringing out the bill, Senator Toni Harp explained that it requires insurance companies to cover modified food products to treat inherited metabolic diseases. In response to a question from Senator Judith Freedman, Senator Harp noted that inherited metabolic diseases include PKU, sickle cell disease, maple syrup urine disease, homocystinuria, and biotinidase deficiency.
The Senate passed the bill on consent.
PUBLIC ACT 01-101
Senator Brain McDermott proposed SB 524, An Act Concerning Health Insurance Coverage for Medically Necessary Infant Formula. SB 524 was referred to the Insurance and Real Estate Committee in January 2001. On March 1, 2001, the Insurance and Real Estate and Public Health committees held a joint public hearing on the bill.
According to public hearing testimony, the bill arose out of the experience of a child who needed a specialized formula called Neocate because he was allergic to soy and milk based formulas. The child's insurance carrier, Anthem Blue Cross Blue Shield, would not cover the cost of the formula, which cost up to $6,000 a year. The attorney general intervened in the case and came to a resolution under which the insurer agreed to cover the medically necessary formula. Parents, health care providers, legislators, and the attorney general spoke in favor of the bill. CBIA and insurance companies opposed the bill as a new insurance mandate that could increase insurance costs.
The Insurance Committee favorably reported the bill to the Senate on March 20, 2001.
The Senate amended the bill without debate on April 25, 2001 and then referred it to the Public Health Committee, which reported the amended bill favorably on May 2, 2001.
The Senate reconsidered the bill on May 10, 2001 and amended it again. The amended bill required individual and group health insurance policies to cover medically necessary “specialized formula” administered under a physician's direction. It defined “specialized formula” as a nutritional formula for children up to age three (1) used solely under medical supervision in the dietary management of specific diseases and (2) exempt from the general nutritional labeling requirements under federal Food and Drug Administration's statutory and regulatory guidelines (e.g., infant formulas typically available by prescription and used by infants with inborn metabolic disorders, low birth weights, or unusual medical problems).
Senator Kevin Sullivan explained the bill noting that there are children with a dietary intolerance to soy and milk who rely on a specialized formula for a short period of their lives and then often outgrow the problem. He said insurers were agreeing to cover the specialized formula on a case-by-case basis. The bill instead would require them to cover the formulas for all children up to age three for whom it was medically necessary.
Senator Louis DeLuca opposed the bill. He said it was well meaning, but noted that the insurance mandate would not affect children whose policies were self-insured and regulated under the federal ERISA law. He estimated that about 50% of policies in Connecticut were self-insured. Secondly, he opposed the bill because it would be a mandate that would add to the cost of insurance premiums for small employers. He said the state already had more than 30 insurance mandates and the cumulative cost adds up, causing some employers to stop offering benefits, and resulting in some people being without coverage altogether.
The Senate passed the bill by a vote of 35 to one.
The House debated the bill on May 23, 2001. Representative Michael Jarjura, who brought out the bill, explained that it would require health insurance coverage for medically necessary specialized infant formula for policies issued or renewed after October 1, 2001. He noted that certain infants, through age three, suffer from medical conditions that prevent them from digesting normal infant formula.
Representative Lile Gibbons questioned Representative Jarjura on the fiscal impact of the bill, particularly on the insurance companies. Representative Jarjura said he thought there was minimal fiscal impact to the state and the insurance companies. He acknowledged that the cost associated with increased premiums would be passed on to consumers but that the impact would be minimal because of the small number of affected children and the age limit included in the bill.
The House passed the bill by unanimous vote.
PUBLIC ACT 04-173
The Insurance and Real Estate Committee raised HB 5201, An Act Concerning Newborn Screening and Medically Necessary Nutritional Formula for Cystic Fibrosis, in February 2004 and held a public hearing on the bill on February 19, 2004.
Parents and health care providers spoke in favor of the bill and explained that cystic fibrosis is a chronic and progressive genetic disease, usually diagnosed in childhood, that causes mucus to clog bodily organs, particularly the lungs and pancreas. It can lead to lung disease, malnutrition, and growth and development problems. Treatment involves a combination of medications; home treatments, including respiratory and nutritional therapies (e.g., feeding tubes); and specialized care by
health professionals. The necessary nutritional formulas cost up to $1,000 a month and are available only with a prescription. Insurance companies and chambers of commerce opposed the bill noting its potential to increase insurance premiums.
On February 24, 2004, the committee reported the bill to the House, which referred it to the Public Health; Appropriations; Finance, Revenue and Bonding; and Planning and Development committees during March and April. Each committee reported the bill favorably.
The House amended the bill by expanding the definition of “inherited metabolic disease” to include cystic fibrosis. Thus, it required individual and group health insurance policies to cover amino acid modified preparations and low protein modified food products prescribed for the treatment of cystic fibrosis. The bill also required health insurance policies to cover medically necessary specialized formula for children up to the age of eight, instead of age three. Lastly, the bill required policies to cover the preparations, food products, and specialized formulas on the same basis as other outpatient prescriptions.
Representative Gary Orefice explained that the bill combined several related bills, added cystic fibrosis to the list of inherited metabolic diseases, and raised the age of the mandated specialized formula coverage for special needs children from three to eight. In response to questions from Representatives Richard Roy and Lenny Winkler, he explained that age eight was selected based on discussions with people knowledgeable in the area, noting that most children needing specialized formula outgrow their need in early adolescence. He also explained that there was no age limit for coverage of food products related to cystic fibrosis. Representatives Linda Orange and Anthony D'Amelio spoke in favor of the bill.
The House passed the bill on April 29, 2004 by unanimous vote.
Senator Joseph Crisco summarized the bill by saying it provides food for people with cystic fibrosis and changes the age from three to eight for formulas. No one else spoke on the bill.
The Senate passed the bill as amended on May 4, 2004 by a vote of 33 to 3.
PUBLIC ACT 07-197
Senator Crisco proposed SB 66, An Act Expanding Insurance Coverage for Specialized Formulas for Children, which was referred to the Insurance and Real Estate Committee in January 2007. On January 23, 2007, the committee held a public hearing on the bill, which eliminated the age eight limitation on insurance coverage for specialized formula.
Parents spoke in favor of the bill, explaining that there are some children who do not outgrow their need for prescription specialized formulas due to their medical conditions, such as severe short-bowel syndrome and food allergies. One parent explained that for her child, who uses a feeding tube, the medically necessary prescription formula and supplies cost $1,500 a month. The Connecticut Chapter of the American Academy of Pediatrics submitted written testimony in favor of the bill, noting that specialized formulas are much more expensive than routine formulas, but far less expensive than the costs of the medical conditions if left untreated.
CBIA opposed the bill because it would (1) be a mandate that would increase insurance premiums and (2) only affect fully insured policies, such as those held by small employers, and not the self-insured plans regulated under federal law. Insurance companies also opposed the bill as a new insurance mandate that could increase insurance costs.
The Insurance and Real Estate Committee favorably reported the bill to the Senate on February 27, 2007. The Senate referred the bill to the Public Health Committee, which reported it favorably on April 11, 2007.
The Senate took up the bill on April 25, 2007. The bill required individual and group health insurance policies to cover medically necessary specialized formulas for children up to age 12, instead of age eight.
Senator Crisco, who introduced the bill, said there are medical reports that some children do not outgrow the need for the specialized formulas, but need to continue receiving the nutritional supplements beyond age eight. He also mentioned the public hearing testimony of one parent who said that she could not afford the nutrition for her child and she would be better off if she stopped working and had HUSKY cover her son.
Senator Crisco said it was an example of a situation where the cost benefit analysis favors the insurance coverage. Senator Edith Prague also spoke in favor of the bill.
The Senate passed the bill by a vote of 33 to two.
The House referred the bill to the Appropriations Committee, which reported it favorably on May 4, 2007.
The House took up the bill on June 6, 2007. Representative Brian O'Connor explained the bill and reported that there were 41 families in Connecticut that need the costly nutritional formulas for their children.
Representative Kevin Witkos opposed the bill. He said that children covered by a self-insured policy will not be affected by the mandate. He also said there was no scientific evidence that the continuation of specialized formula to age 12 is necessary.
The House passed the bill by a vote of 131 to six.