REPORT TITLE: 
Diabetes Outpatient Coverage


DESCRIPTION:
Mandates coverage under most health insurance policies and
contracts for diabetes outpatient self-management training,
education, equipment, and supplies.  Clarifies deposit of
assessment with the Insurance Commissioner for health insurers;
transfers Hawaii mental health task force from DOH to insurance
division and revises composition of membership.  (HB2392 CD1) 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        2392
THE HOUSE OF REPRESENTATIVES            H.B. NO.           H.D. 2
TWENTIETH LEGISLATURE, 2000                                S.D. 1
STATE OF HAWAII                                            C.D. 1
                                                             
________________________________________________________________
________________________________________________________________


                     A BILL FOR AN ACT

RELATING TO HEALTH.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1                              PART I
 
 2      SECTION 1.  The legislature finds that approximately ninety
 
 3 thousand people living in Hawaii have diabetes.  Native Hawaiians
 
 4 and Asians experience a risk of developing diabetes that is twice
 
 5 that of the general U.S. population.  Native Hawaiians, compared
 
 6 to all other racial groups in the State during the years 1989
 
 7 through 1991, had the highest rate of mortality due to diabetes
 
 8 and its complications (34.7 out of every one hundred thousand
 
 9 residents), a rate that was one hundred thirty per cent higher
 
10 than that of any other racial group in Hawaii (15.1 out of every
 
11 one hundred thousand residents).  Of native Hawaiians, those of
 
12 pure Hawaiian descent had the highest mortality rate (93.3 out of
 
13 every one hundred thousand residents), a rate that was five
 
14 hundred eighteen per cent higher than that of any other racial
 
15 group in the State.
 
16      The legislature finds that effective outpatient self-
 
17 management by persons with diabetes results directly in a
 
18 significant reduction in both the economic and human devastation
 
19 wrought by the disease.  There is ample evidence that tight
 
20 control of blood sugar levels through patient self-management can
 

 
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 1 dramatically lower the incidence of complications, increase life
 
 2 expectancy, and significantly enhance the quality of life of
 
 3 persons with diabetes.  In addition, studies show that providing
 
 4 individuals with diabetes with the appropriate supplies and
 
 5 training for self-management results in a decrease in health care
 
 6 services utilization and costs.  Hawaii fails to recover these
 
 7 cost savings, however, because most health plans only provide
 
 8 coverage for equipment and supplies, and do not cover diabetes
 
 9 self-management education and training.
 
10      The purpose of this Act is to require all individual and
 
11 group accident and sickness health care policies providing health
 
12 care coverage, and all individual and group health care contracts
 
13 issued by health maintenance organizations and mutual benefit
 
14 societies, to provide coverage for outpatient diabetes self-
 
15 management training, education, equipment, and supplies.
 
16      SECTION 2.  Chapter 431, Hawaii Revised Statutes, is amended
 
17 by adding a new section to article 10A to be appropriately
 
18 designated to read as follows:
 
19      "�431:10A-    Coverage for diabetes.  Each policy of
 
20 accident and sickness insurance providing coverage for health
 
21 care, other than an accident-only, specified disease, hospital
 
22 indemnity, medicare supplement, long-term care, or other limited
 
23 benefit health insurance policy, that is issued or renewed in
 

 
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 1 this State, shall provide coverage for outpatient diabetes self-
 
 2 management training, education, equipment, and supplies, if:
 
 3      (1)  The equipment, supplies, training, and education are
 
 4           medically necessary; and
 
 5      (2)  The equipment, supplies, training, and education are
 
 6           prescribed by a health care professional authorized to
 
 7           prescribe."
 
 8      SECTION 3.  Chapter 432, Hawaii Revised Statutes, is amended
 
 9 by adding a new section to article 1 to be appropriately
 
10 designated and to read as follows:
 
11      "�432:1-    Diabetes coverage.  All group health care
 
12 contracts under this chapter shall provide, to the extent
 
13 provided under section 431:10A-   , coverage for outpatient
 
14 diabetes self-management training, education, equipment, and
 
15 supplies."
 
16      SECTION 4.  Section 432D-23, Hawaii Revised Statutes, is
 
17 amended to read as follows:
 
18      "�432D-23  Required provisions and benefits.
 
19 Notwithstanding any provision of law to the contrary, each
 
20 policy, contract, plan, or agreement issued in the State after
 
21 January 1, 1995, by health maintenance organizations pursuant to
 
22 this chapter, shall include benefits provided in sections
 
23 431:10-212, 431:10A-115, 431:10A-115.5, 431:10A-116,
 

 
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 1 431:10A-116.5, 431:10A-116.6, [and] 431:10A-119, [and] 431:10A-
 
 2 120, and 431:10A-   , and chapter 431M."
 
 3      SECTION 5.  Each insurer, health maintenance organization,
 
 4 and mutual benefit society required to provide coverage for
 
 5 outpatient diabetes self-management training, education,
 
 6 equipment, and supplies is requested to conduct a study of their
 
 7 respective diabetes coverages.  Each study should be completed
 
 8 and a report made to the legislature no later than twenty days
 
 9 prior to the convening of the regular session of 2003.  Each
 
10 study should evaluate:
 
11      (1)  The effectiveness of and any cost savings from a
 
12           continuum of care utilizing a systematic approach to
 
13           diabetes disease management; and
 
14      (2)  The quality of care delivered by providers of diabetes
 
15           self-management, including their levels of training and
 
16           whether or not they are certified in diabetes education
 
17           according to established national standards.
 
18                              PART II
 
19      SECTION 6.  Section 431:2-216, Hawaii Revised Statutes, is
 
20 amended by amending subsection (a) to read as follows:
 
21      "(a)  Beginning with fiscal year 2000-2001, and including
 
22 fiscal year 2001-2002, each mutual benefit society under article
 
23 1 of chapter 432, health maintenance organization under chapter
 

 
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 1 432D, and any other entity offering or providing health benefits
 
 2 or services under the regulation of the commissioner, except an
 
 3 insurer licensed to offer health insurance under article 10A,
 
 4 shall deposit with the commissioner by July 1 of each year an
 
 5 assessment of $10,000 for the first zero to seventy thousand
 
 6 private, nongovernment members the entity covers and an
 
 7 additional assessment on a pro rata basis to be determined and
 
 8 imposed by the commissioner for covered members exceeding seventy
 
 9 thousand; provided that in the third year and each year
 
10 thereafter, assessments shall be borne on a pro rata basis.  The
 
11 aggregate annual assessment shall not exceed $1,000,000.  The
 
12 assessment shall be credited to the insurance regulation fund.
 
13 If assessments are increased, the commissioner shall provide to
 
14 any organization or entity subject to the increased assessment,
 
15 justification for the increase."
 
16      SECTION 7.  Section 431M-5, Hawaii Revised Statutes, is
 
17 amended by amending subsection (c) to read as follows:
 
18      "(c)  A health insurance plan shall not impose rates, terms,
 
19 or conditions including service limits and financial
 
20 requirements, on serious mental illness benefits, if similar
 
21 rates, terms, or conditions are not applied to services for other
 
22 medical or surgical conditions.  This [subsection] chapter shall
 
23 not apply to individual contracts; [or group hospital or medical
 

 
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 1 service plan contracts, and nonprofit mutual benefit association
 
 2 and health maintenance organization health plan contracts
 
 3 providing coverage to employers with twenty-five or fewer
 
 4 employees, and government employee health benefits plans under
 
 5 chapter 87; and] provided further that this [subsection] chapter
 
 6 shall not apply to QUEST medical plans under the department of
 
 7 human services until July 1, 2002."
 
 8      SECTION 8.  Act 121, Session Laws of Hawaii 1999, is amended
 
 9 as follows:
 
10      1.  By amending section 4 to read:
 
11      "SECTION 4.  (a)  There is established, within the
 
12 [department of health] insurance division of the department of
 
13 commerce and consumer affairs for administrative purposes only,
 
14 the Hawaii mental health [insurance] task force to study the
 
15 financial and social implications of mandated equal mental health
 
16 and substance abuse insurance coverage in Hawaii.
 
17      (b)  The task force shall be [comprised] composed of the
 
18 following [twenty-two] twenty-one members[:
 
19      (1)  One member of the senate committee on health and human
 
20           services appointed by the president of the senate;
 
21      (2)  One member of the house of representatives committee on
 
22           health appointed by the speaker of the house of
 
23           representatives;
 

 
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 1      (3)  One] with one voting member from each of the following
 
 2           organizations and agencies appointed by the [governor:]
 
 3           organization or agency:
 
 4           (A)  Hawaii Medical Service Association;
 
 5           (B)  Kaiser Permanente Medical Care Program;
 
 6           (C)  Department of human services;
 
 7           (D)  Department of health;
 
 8           (E)  Equal Insurance Coalition;
 
 9           (F)  NAMI, Oahu;
 
10           (G)  Hawaii Psychological Association;
 
11           (H)  Chamber of Commerce of Hawaii;
 
12           (I)  Hawaii Psychiatric Medical Association;
 
13           (J)  Hawaii Business Health Council;
 
14           (K)  [Hawaii Medical Association;] Hawaii Employers
 
15                Council;
 
16           (L)  Mental Health Association of Hawaii;
 
17           (M)  National Federation of Independent Businesses;
 
18           (N)  Hawaii Nurses' Association;
 
19           (O)  [Hawaii Building and Trades Council;] Healthcare
 
20                Association of Hawaii;
 
21           (P)  Hawaii Business League;
 
22           (Q)  A consumer from United Self-Help;
 
23           (R)  Hawaii Biodyne Inc.; 
 

 
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 1           (S)  Queen's Health Plans;
 
 2           (T)  National Association of Social Workers, Hawaii
 
 3                Chapter; and
 
 4           (U)  A labor union selected by the insurance
 
 5                commissioner.
 
 6      [(3) The following members to be appointed by the task
 
 7           force:
 
 8           (A)  Two members representing mental health consumers;
 
 9                and
 
10           (B)  One member representing small business
 
11                organizations in the state;
 
12      (4)  One member representing the University of Hawaii school
 
13           of public health, with expertise in biomedical
 
14           statistics or economics.] 
 
15      (c)  The task force shall:
 
16      (1)  Investigate ways to define and quantify unmet mental
 
17           health and substance abuse needs in the State, and
 
18           shall analyze possible outcome data collection measures
 
19           in order to meaningfully measure and describe:
 
20           (A)  The efficacy of mental health and substance abuse
 
21                treatment in the State; and
 
22           (B)  Unmet mental health and substance abuse treatment
 
23                needs;
 

 
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 1      (2)  Describe mental health and substance abuse coverage in
 
 2           the State, including deductibles, copayments, and
 
 3           covered illnesses and conditions;
 
 4      (3)  Describe the relative costs of mental illness and
 
 5           substance abuse coverage, and other health coverage in
 
 6           the State;
 
 7      (4)  Describe mental health and substance abuse treatment
 
 8           utilization in the State by adults, adolescents, and
 
 9           children;
 
10      (5)  Produce an analysis of the needs of individuals who
 
11           have exhausted their mental health or substance abuse
 
12           treatment benefits; and
 
13      (6)  Determine the effect of additional mandated [serious]
 
14           mental [illness] health insurance benefits [parity] on
 
15           [mental health and substance abuse services] consumers,
 
16           affected health plans, businesses, health care
 
17           providers, and other concerned parties, including a
 
18           review of the experience of health plans in providing
 
19           the coverage, and an assessment of any impact on costs,
 
20           services provided, and services utilization[; and
 
21      (7)  Develop treatment and utilization guidelines for
 
22           severe, biologically-based mental illnesses in addition
 

 
 
 
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 1           to those covered under this Act, including, but not
 
 2           limited to:
 
 3           (A)  Major depression;
 
 4           (B)  Obsessive compulsive disorders;
 
 5           (C)  Severe panic disorders;
 
 6           (D)  Autism and pervasive development disorders;
 
 7           (E)  Multiple personality disorder (disassociative
 
 8                disorder);
 
 9           (F)  Brain damage or disfunction as defined by
 
10                neuropsychological testing; and
 
11           (G)  Other severe and disabling mental disorders such
 
12                as severe anorexia, severe attention-deficit/
 
13 hyperactivity disorder, and severe dyslexia].
 
14      (d)  The task force shall perform its duties as follows:
 
15      (1)  [The task force shall not utilize any moneys from the
 
16           general fund to support its functions.]  Members shall
 
17           serve without compensation;
 
18      (2)  A simple majority of the members of the task force
 
19           shall constitute a quorum for the transaction of
 
20           business, and all actions of the task force shall
 
21           require the affirmative vote of a majority of the
 
22           members present;
 

 
 
 
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 1      (3)  The task force may hold public hearings as frequently
 
 2           as deemed necessary and feasible to receive testimony
 
 3           on issues relative to the task force's investigation;
 
 4           and
 
 5      (4)  The task force may invite participants, including the
 
 6           auditor or the auditor's representative, as deemed
 
 7           necessary to effectuate its purposes.
 
 8      (e)  The task force shall submit a report of its findings
 
 9 and recommendations to the speaker of the house of
 
10 representatives, the president of the senate, and the governor no
 
11 later than twenty days before the convening of the regular
 
12 session of 2001[, and shall be dissolved upon submittal of its
 
13 report.  Provided that the task force shall submit the report of
 
14 its findings and recommendations concerning treatment and
 
15 utilization guidelines as required under subsection (c)(7) of
 
16 this section, to the speaker of the house of representatives, the
 
17 president of the senate, and the governor no later than twenty
 
18 days before the convening of the regular session of 2000]."
 
19      2.  By amending section 6 to read:
 
20      "SECTION 6.  This Act shall take effect on July 1, 1999;
 
21 provided that insurance, health, or service plan contracts
 
22 subject to the terms of this Act and issued or renewed after
 
23 December 31, 1999, shall be amended to be consistent with this
 

 
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 1 Act; and provided that this Act shall be repealed on [July 1,
 
 2 2005.] June 30, 2003."
 
 3      SECTION 9.  If any provision of this Act, or the application
 
 4 thereof to any person or circumstance is held invalid, the
 
 5 invalidity does not affect other provisions or applications of
 
 6 the Act, which can be given effect without the invalid provision
 
 7 or application, and to this end the provisions of the Act are
 
 8 severable.
 
 9      SECTION 10.  Statutory material to be repealed is bracketed.
 
10 New statutory material is underscored.
 
11      SECTION 11.  This Act shall take effect on July 1, 2001;
 
12 provided that:
 
13      (1)  Sections 6, 7, and 8 shall take effect upon approval;
 
14           and
 
15      (2)  Sections 6 and 7 shall be repealed on June 30, 2003;
 
16           and sections 431:2-216 and 431M-5, Hawaii Revised
 
17           Statutes, are reenacted in the form in which they read
 
18           on the day before approval of this Act.