The Committee on Commerce and Labor was called to order at 3:50 p.m., on Wednesday, February 24, 1999. Chairman Barbara Buckley presided in Room 3142 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Ms. Barbara Buckley, Chairman

Mr. Richard Perkins, Vice Chairman

Mr. Morse Arberry, Jr.

Mr. Bob Beers

Ms. Merle Berman

Mrs. Jan Evans

Mr. Joe Dini, Jr.

Ms. Chris Giunchigliani

Mr. David Goldwater

Mr. Lynn Hettrick

Mr. David Humke

Mr. Dennis Nolan

Mr. David Parks

Mrs. Gene Segerblom

GUEST LEGISLATORS PRESENT:

Assemblywoman Genie Ohrenschall, Assembly District 12

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

After roll call, Chairman Buckley asked committee members to introduce the following bill draft request:

• BDR 53-105 makes various changes concerning industrial insurance. (A.B. 326)

Chairman Buckley opened the hearing on A.B. 194.

Assemblywoman Segerblom spoke on behalf of A.B. 194, which was suggested to her by Kim Crandell, Chief Executive Officer (CEO) of Boulder City Hospital, who was present. He provided written testimony (Exhibit C) and explained A.B. 194 had originated because of the efforts of concerned citizens of Boulder City who were unhappy with the health care they received through their health plans.

Mr. Crandell stated Managed Care Organizations (MCOs) discouraged local physicians from following their patients when the patient was transferred to a different hospital. MCOs employee "hospital intensivists", hospital physicians who worked only in designated hospitals and monitored inpatient plan members who had been transferred. He noted it created a source of confusion for patients who had selected a plan with a specific doctor as their primary physician; yet that physician was prohibited from treating them after the hospital transfer. He also noted insured individuals were often not allowed to receive such things as X-rays at their local community hospital.

Mr. Crandell continued, in 1996 a public forum was held in Boulder City to discuss managed care in the community. The public was very displeased they were not able to receive health care in their communities. Since 1996, Boulder City physicians and local healthcare providers had expressed those concerns to the managed care providers. Mr. Crandell explained treatment received from a selected primary physician indicated a higher quality of care than treatment provided by a physician who did not know the individual’s background.

A.B. 194 was a result of the many complaints from physicians and patients in the Boulder City community. A.B. 194 would insure patients in rural Nevada, who chose an MCO provider, would be able to stay in their hometown to receive health care. A.B. 194 was not an attack on managed care; managed care was an important part of the health care system. However, to require patients to leave their local community to receive basic care was not "good patient care."

Chairman Buckley clarified the intent of Mr. Crandell’s testimony. Boulder City Hospital was not attempting to force managed care to contract with them. If a physician on a preferred provider list from Boulder City Hospital had been selected by an individual, he/she should not be discouraged from using Boulder City Hospital simply because the managed care provider assigned "intensivists" who only had privileges at another hospital and were not selected by the patient.

Mr. Crandell noted it was understood all services for which a patient had contracted should have been provided; however, that was not true in some cases. He pointed out all MCOs did not function alike. The intent was if an MCO was willing to provide care, it should allow a patient to stay in the community. It was better health care. The standard of health care within the community would be compromised if it was all directed out of the community.

Assemblywoman Evans asked for clarification on how payments were going to be settled; an important consideration was whether the expectation was that the insurer paid full bill charges.

Mr. Crandell responded A.B. 194 did not address rates or fees. The individual provider would determine that, so no restrictions would be put on health-care fees. Boulder City Hospital was competitive with its rates, and A.B. 194 only came into effect after an agreement was negotiated. He emphasized the bill only addressed the delivery and access to health care.

Chairman Buckley clarified rate negotiations were left to hospitals and MCOs. A.B. 194 would only apply if there was a contract made following those rate negotiations.

Mr. Crandell mentioned a case in point. An MCO in southern Nevada negotiated in good faith with Boulder City Hospital; however, the MCO had no intention of allowing a patient to use Boulder City Hospital. Every time there was an opportunity for a patient to receive inpatient or outpatient care at Boulder City Hospital, they were not allowed access to that care. He remarked that was not the case with all MCOs. A discounted rate for emergency treatment at Boulder City Hospital was the only thing guaranteed by having a contract.

Mr. Hettrick wanted clarification if the hospital intensivist provided services for less money than the primary care physician did. Mr. Crandell did not know.

Mr. Hettrick asked if Boulder City Hospital’s rates were as low or lower than the hospitals to which a patient would be transferred.

Through talking with peers in the community, Mr. Crandell understood Boulder City Hospital’s rates were competitive, and per-diem rates were actually lower. Mr. Hettrick pointed out it would be helpful if the committee knew what the rates were. Mr. Crandell reiterated that Boulder City Hospital had lower per-diem rates than other hospitals.

Marv Teixeira represented Carson Tahoe Hospital and testified in favor of A.B. 194 (Exhibit D). He noted the issues addressed by A.B. 194 were quality of patient care, choice, and access. Many Carson residents chose Saint Mary’s Regional Center or Washoe Medical Center over Carson Tahoe Hospital. His organization had no quarrel with that fact, as long as consumers were not forced by MCOs to choose the other hospitals. A.B. 194 prohibited MCOs from denying patients accessibility and care from their own local community hospital.

Steve Smith, Administrator of Carson Tahoe Hospital, and representing all Nevada Rural Project Hospitals who had met and agreed on A.B. 194, spoke in favor of the bill. Almost all Nevada rural project hospitals were very small and were outside of Washoe and Clark Counties with the exception of Boulder City Hospital. He noted Carson Tahoe Hospital had a contract with every insurance company represented at the hearing. The issue was about access to health care, not money. He noted the state’s report on ‘dollars for health care spent on inpatient care’ indicated if the rural project hospitals did not charge for their services, the entire health care budget was only impacted by 5 percent. He opined the statistics would be similar for outpatient care.

Mr. Smith emphasized whether an individual lived in Yerington, Fallon, or Carson City, that individual deserved a choice of which hospital provided their health care service.

Chairman Buckley suggested committee members address their questions about intensivists and hospitals transfers to individuals in the managed healthcare industry.

Mr. Nolan asked Mr. Crandell if physicians, not insurance companies, generally made the requests for hospital transfers. Mr. Crandell responded the intensivists were contracted to perform specific health care duties, so it was understood they would administer care to transfer patients. Insurance companies set up the system, and physicians functioned in a predetermined manner.

Mr. Nolan noted if it was an insurance company’s decision to transfer a patient, and there were differences in the fees and rates of each hospital, a situation could arise where it would cost the insurance company less to treat the patient at one of the hospitals. Mr. Nolan wanted confirmation from Mr. Crandell that there was no provision in the bill which prohibited the transferring of a patient because of the necessity of a higher level of care. Mr. Crandell replied that regardless of who paid the medical bill, if a higher level of care was required, the patient would always be transferred to another hospital.

Chairman Buckley suggested Fred Hillerby, who represented Hometown Health Plan (HHP), present an overview to explain how intensivists worked. She had been contacted by individuals who had selected doctors and hospitals from a preferred provider list and once admitted they were not allowed to be treated by their personal physician, instead an intensivist took over care. The individuals were concerned they did not receive care from the doctor they had selected.

Mr. Hillerby introduced Doctor Michael Daines, Medical Director for Hometown Health Plan. He mentioned HHP referred to "intensivists" as "hospitalists" and noted they did not use them to the extent of other health care plans.

Dr. Daines explained hospital intensivists were a national trend. They focused the activity of hospital based positions on inpatients. They were not distracted by office duties. There was a quality improvement aspect to intensivists, because they were able to monitor patients several times per day, and were able to respond quickly to a patient’s condition. There was an economical benefit because hospital intensivists could resolve a patient’s medical problem in fewer days, with fewer numbers of tests. He noted hospital intensivists had more experience with hospital-based medicine than practitioners or general internists. A general internist may treat 7 or 8 stroke victims in a year, while a hospital intensivist may have treated as many as 40 or 50, making the hospital intensivist more proficient.

HHP was exploring the idea of employing hospital intensivists. Their intention was to provide hospital intensivists to policyholders on a voluntary rather than a mandated basis. There were quality and economical reasons to incorporate hospital intensivists in a managed care plan.

Mr. Hillerby noted section 1, line 6 of A.B. 194, and commented the reference to communities of "less than 45,000 or the unincorporated area of a county" may be too broad, because hospitals such as Sunrise and Desert Springs would be included because they were in unincorporated areas. In response to Mr. Nolan’s question about the denial of a hospital transfer when there was a quality of care issue, he said while A.B. 194 did not prohibit that action, it did not allow it either. The bill simply stated MCOs could not prohibit or discourage an insured from receiving services covered by the health care plan of the insured at that hospital if the services were provided. He noted there were times a transfer was indicated for cardiac treatment even though the hospital had a cardiology department. Many times, those transfers were quality issues, not simply economic issues.

Dr. Daines explained Hometown Health had issues with regard to cardiac services at Carson Tahoe Hospital. Cardiac surgery was not available at Carson Tahoe Hospital to treat a patient if an invasive cardiac procedure that was being performed suffered complications. That would necessitate an air ambulance transfer to Washoe Medical Center, where a standby team may not be available. Whereas if the procedure was performed at Washoe Medical Center, a standby operation team was always readily available. Sometimes two-stage procedures were required at Carson Tahoe Hospital, which could be handled in one stage at Washoe Medical. So there were quality and economic motivations in specific circumstance. Hometown Health wanted to deal with the contracting hospital directly, rather than through the legislation.

Mr. Hillerby stated health plans around the U.S. were struggling. A hospital transfer could be done for economic and quality reasons. He noted the Carson City community had not been able to offer its senior citizens an HMO alternative. Insurance companies had a responsibility to policyholders and premium payers to provide a competitive and quality product.

It was Mr. Perkins’ understanding an individual, who acted according to the rules when selecting a doctor and a hospital from a preferred provider list, may be transferred without having been consulted. Because the state of mind of the patient was crucial in recovery, he was concerned the individual did not have any involvement in the decision. A feeling of trust between a personal physician and a patient was key in the recovery of the patient. The recovery process may be hindered if the personal physician was replaced with a physician who simply had more experience in a particular field.

Dr. Daines noted the medical director and the primary physician discussed the options, risks, and benefits of a hospital transfer. There were insurance plans available to the consumer that did not place restrictions between the consumer and the site of delivery. If those products were selected, an individual could go to any hospital or provider he/she desired. Other plans did place restrictions that sometimes necessitated the use of preferred facilities for certain types of services.

Mr. Perkins emphasized his concern that it was not the patient’s decision whether or not to be transferred to a different hospital. The patient could be transferred even if he/she was under the care of the doctor selected from the preferred provider list.

Dr. Daines remarked an individual would not be forced against his/her will. He said A.B. 194 would prohibit a medical director from attempting to influence or even enter into a discussion with the personal physician when making the decision on the transfer of a patient.

Chairman Buckley asked Mr. Hillerby to provide more information on the use of hospital intensivists in order to determine when they were mandatory, and when they were employed to offer expertise. The committee was very concerned about consumer disclosure. She wanted to know how a policy that included hospital intensivists read. She was also interested to know if the consumer knew they were purchasing a plan, which stipulated the hospital they selected might not be the one in which they were treated.

Mr. Nolan asked if the insurer maintained the ability to decline benefits to an individual who refused to be treated by a hospital intensivist or declined to be transferred.

Mr. Hillerby pointed out prior authorization was a process that was a part of managed care, and even if a physician was on a provider list, prior authorization still came into play

Chairman Buckley closed the hearing on A.B. 194.

Assemblywoman Merle Berman, District 2, presented A.B. 162 and as its sponsor read written testimony (Exhibit E). She stated according to the National Osteoporosis Foundation, 2 million men, and 8 million women had osteoporosis. Osteoporosis remained underdiagnosed and underreported regardless of the large number of people affected. A.B. 162 would help increase the diagnosis and reporting of the disease.

Some women were at higher risk of being diagnosed with osteoporosis if they:

• Were deficient in estrogen.
• Had bone abnormalities.
• Were receiving long-term, cortisone therapy.
• Had primary hyperparathyroidism.
• Had a family history of osteoporosis.

She noted men had the same risks as women.

Bone density tests and bone mass measurement tests were the current screening tests in place for osteoporosis. The cost to the healthcare system associated with osteoporotic fractures exceeded $13.8 billion annually. She stated by offering osteoporotic tests, there would potentially be significant savings to insurance companies.

She noted A.B. 162 was a preventative health measure bill, which would only reduce costs associated with health insurance premiums.

She referred to Exhibit F and pointed out the statistics for the Nevada population over the age of 50, which was the age at which she wanted baseline osteoporosis testing. Thirteen percent of Nevada’s population had been diagnosed with osteoporosis, which was not out of the normal range.

Ms. Berman on noted page 2 of Exhibit F, according to a government report, $10 billion was being spent annually for treating osteoporosis. By the year 2020, the amount spent would rise to $30 billion. She noted between 1995 and 2015, 24,900 Nevada women over the age of 44 were expected to suffer hip fractures. The annual cost to Nevada’s health care system would increase from $20 million in 1995 to $103 million in 2015. She urged the committee to support A.B. 162.

Tom Wood, State Government Affairs Manager for Wyeth Ayrist Laboratories, spoke next in favor of A.B. 162. His organization was the leading ‘deliverer’ of women’s health care in the world. As an educator in the health community he had dealt with osteoporosis for 23 years and was distressed there were over 250,000 hip fractures annually, most likely caused by bone deterioration. He noted 50 percent of the 250,000 Americans with hip fractures, may never walk again, 25 percent were forced to enter nursing homes, and 15 percent would die. Much of that was preventable. There were simple tests that predicted osteoporosis and suggested life-styles and medications that could prevent bone loss. The tests, education, and awareness were essential in reducing osteoporosis. He stated A.B. 162 was a start in the prevention of osteoporosis.

Larry Matheis, Executive Director of the Nevada State Medical Association (NSMA) spoke in favor of A.B. 162. He thanked Ms. Berman for introducing the bill, and noted it was extremely important. Before the federal Medicare program recognized osteoporosis as a problem, it had been very serious for senior women. A.B. 162 would lower the age (by 10 years) at which osteoporosis screening was currently performed which would allow earlier intervention and treatment. He said it was extremely reasonable to lower the age to 55. Osteoporosis was one of the most significant problems women faced in aging, and the means for prevention were available. He suggested an individual should not be able to buy a health plan that did not include baseline screenings for osteoporosis. It was inexcusable to overlook something so fundamental to every woman. He noted osteoporosis was an important issue that was properly addressed in A.B. 162, and his organization supported it.

Jan Gilbert, representing the League of Women Voters, spoke next on A.B. 162. Her organization conducted national health studies. She referred to her organization’s ‘Impact on Issues’ and noted it did not mention osteoporosis or mammograms, but it did mention prevention. A.B. 162 and A.B. 163 were preventative measures that would save the insurance companies money. She urged the committee to pass both A.B. 162 and A.B. 163.

Bobbie Gang, representing the League of Woman Voters, stated her organization supported A.B. 162. She said the ability to diagnose osteoporosis early would save many elderly women from constant pain and would eliminate disruptions in their lifestyles. The burden of cost to family members who took care of those suffering from osteoporosis would decrease. She also presented a letter from the Nevada Nurses Association, which indicated their support of A.B. 162. (Exhibit G)

Ms. Giunchigliani commented the issue of prevention was prevalent, and there was much legislation that attempted to focus insurance companies on diagnostic prevention.

Mr. Nolan said he was familiar with the testing process of bone mass measurements and noted it was a very quick and simple process, which he surmised could be performed in most physician’s offices. He asked if health plans currently covered that procedure. Mr. Matheis responded some healthcare plans did, and "basic coverage" greatly varied because of the age issue.

In response to Mrs. Segerblom’s question if exercise was being promoted, Bobbie Gang noted there was a lot of educational information available.

Ms. Berman stated there were seven states that mandated bone mass testing, and she wanted to make Nevada number eight.

Ed Fend, Vice Chair, State Legislative Committee (SLC), and Capitol City Task Force (CCTF) Coordinator, American Association of Retired Persons (AARP) stated that AARP had unanimously voted to support A.B. 162.

Chairman Buckley closed the public hearing on A.B. 162, but she would reserve time at the end to hear the MCOs’ testimony in opposition to all four bills.

Assemblywoman Berman, sponsor of the bill, introduced A.B. 163 (Exhibit H). Breast cancer was the leading cause of deaths in women between the ages of 15 and 54. Ms. Berman had a friend, Linda Creed, who fought breast cancer for 11 years, and died at the age of 37. Ms. Berman noted that breast cancer did affect young women. She further noted A.B. 162 was about giving young women the right to have a mammography.

According to the American Cancer Society, each year there were approximately 179,000 new cases of breast cancer in the U.S., and approximately 43,500 deaths from the disease. It was estimated 1,000 new female breast cancer cases would be reported in Nevada in 1999, 300 of whom would die.

Currently Nevada’s provision allowed for a baseline mammogram for women between 35 and 40, and an annual mammogram for women 40 and older.

Ms. Berman stated the most common provisions in 18 other state’s laws for mammographies, was coverage for a baseline mammogram for women between 35 and 39, and one every 2 years for women between the ages of 40 and 49. Annual mammograms were provided for women 50 and over. She had breast cancer at age 42, and surmised that she would not have survived until the age of 50, because she would have missed the cancer if she had not had an earlier mammogram. She noted nine other states had an additional clause that allowed high-risk women to receive annual mammograms at any age.

Ms. Berman noted a mammogram was the best way to detect breast cancer in its earliest and most treatable state. Additionally, mammograms located cancers that were too small to be detected by a clinical exam, and they detected cancer an average of 1.7 years before the women could feel the lump.

Ms. Berman stated the survival rate was better, the earlier the breast cancer was detected. The 5-year survival rate was 97 percent when the cancer was diagnosed in a localized site, however the survival rate dropped to 21 percent when the cancer was diagnosed after it spread.

She emphasized annual mammograms for women who were at high-risk was absolutely necessary and urged the committee to support A.B. 163

Bobbie Gang represented the Nevada Women’s Lobby, which strongly supported A.B. 163. Ms. Gang noted she had a friend, Brenda Caplan, who received mammograms every 6 months because she was so fearful of not detecting a lump early enough. Ms. Caplan was at high risk and was in fear for her daughter and granddaughter. Ms. Gang read a letter from Ms. Caplan to the committee (Exhibit I).

In the letter, Ms. Caplan noted she was at high risk for breast cancer and was fortunate she had doctors who requested she have regular 6-month exams, and a mammogram every 2 years, when she was only 29 years old. Her insurance did not pay for all of the diagnostic procedures, so she paid for them herself. She continued to obtain the testing on a regular basis, until 1992, when she was diagnosed with breast cancer. She was concerned about her 30-year-old daughter, and the genetic link that threatened her. She emphasized timing was everything when it came to diagnosing breast cancer. The sooner a diagnosis was made, the better the chance of survival. She encouraged the committee to consider the merits of A.B. 163, and added many women under the age of 40 lived with a genetic predisposition for breast cancer. It was her hope high-risk women would be given the opportunity to take control of their own prevention of breast cancer by mandating insurance companies to provide coverage of yearly mammograms for them.

Ms. Gang provided copies of a letter from the Nevada Nurses Association (NNA), to committee members which expressed their support for A.B. 163 (Exhibit J).

Gale Thomssen, Chairwoman for the Susan G. Komen Breast Cancer Foundation Northern Nevada Race for a Cure, shared her experiences and opinions with the committee (Exhibit K). She noted her motivation to be involved with breast cancer issues came from friends who had died in the process of fighting breast cancer. Cancer, in all 200 varieties, was increasing in the U.S., one of two men and one of three women would develop cancer in their lifetimes. She noted family history played a strong role in the development of breast cancer. She stated of 175,000 new cases of breast cancer, 8,200 would be under the age of 40. Early detection meant the difference between a lumpectomy, which could be done in less than 24 hours, compared to a mastectomy, which was much more extensive.

Ms. Berman noted 28 states had already passed bills similar to A.B. 163, and encouraged the committee to make Nevada the 29^th to do so.

Chairman Buckley noted how prevalent breast cancer was. Prevention was the key to saving lives, and she thanked Ms. Berman for her testimony. The League of Women Voters’ support was noted for the record.

Mr. Fend noted as a father of four daughters, he was strongly in favor of A.B. 163.

Mr. Matheis testified in favor of A.B. 163. There were technical amendments to be made to ensure the risk factor statements in the bill were scientifically correct. NSMA completely supported A.B. 163. The concern the insurance industry had regarding potential costs was understandable, but he asked how ‘basic coverage’ could not include those preventive health care measures. A.B. 163 regularized the coverage of mammograms so every Nevada woman who was covered by insurance or a managed health care plan could receive a mammogram in time for early diagnosis of breast cancer.

Ms. Giunchigliani noted if the terms "cystic or fibroid" needed to be included in the bill because mammogram screenings sometimes revealed many cysts. Mr. Matheis did not know but said he would confer with another doctor.

Chairman Buckley suggested the committee be provided with information on how many health plans currently covered mammograms and what the specific provisions were for conducting one. She asked what was done when the recommendations on mammograms changed in the medical literature, but the statute had not yet been changed.

Mr. Matheis stated the provisions on which the committee was working were likely to encompass those kinds of changes. The state’s Insurance Division had the authority to temporarily "fine tune" legislation. It was unfortunate they had to address that level of specificity in law, but it was necessary because there were too many cases in which coverage was not being offered.

Carla Kain, private citizen, testified in favor of A.B. 163. She was a 39-year-old breast cancer survivor who was concerned for her daughters even though breast cancer was not prevalent in her family. She had detected a lump in one of her breasts, did not address it for 9 months and lost her breast. She said a mammogram would have been the first step in preventing the loss of her breast. Ms. Kain was concerned her daughters were not going to receive early treatment.

Chairman Buckley closed the hearing on A.B. 162; she would reserve time at the end for testimony by representatives of managed care organizations in opposition to all four bills.

Assemblywoman Genie Ohrenschall presented A.B. 172. Ms. Ohrenschall advised the committee subparagraph 2, section 2, page 2 would be deleted due to technical problems.

She testified in favor of A.B. 172 (Exhibit L). A.B. 172 required MCOs to cover certain services provided to a person at a hospital after he/she received emergency services. Section 1 of the bill provided that if a physician recommended an insured person remain in the hospital for observation or additional treatment after receiving medically necessary emergency services, the MCO was required to provide coverage for those services. If the MCO did not affirmatively deny coverage for the additional stay and treatment when contracted, the MCO was required to provide coverage. Those provisions were applicable to health care plans delivered, issued for delivery, or renewed on or after October 1, 1999.

She noted in A.B. 172 the term "medically necessary emergency services" had the meaning ascribed to it in subsection 3 of NRS 695G.170. A.B. 172 did not impose upon insurers any requirement to pay for benefits that were not already covered by a policy of insurance. She noted MCO coverage and the emphasis on controlling costs had grown tremendously, and it was important to continue to provide quality health care.

Ms. Ohrenschall commented A.B. 172 was consequent to A.B. 156, which was introduced by Assemblywoman Buckley in the 69^th session. A.B. 172 provided the knowledge that an individual’s follow-up care was indeed covered.

Ed Fend, representing American Association of Retired Persons (AARP), stated his organization had examined A.B. 172, and agreed generic medications could be prescribed only if the patient did not have a history of allergic reactions to the medication. Chairman Buckley interjected Ms. Ohrenschall had deleted that section from the bill because of technical problems.

Mr. Fend continued, the object of A.B. 172 was to ensure proper follow-up to emergency medical services. He stated AARP strongly endorsed A.B. 172.

Chairman Buckley closed the hearing on A.B. 172, and asked Mr. Hillerby to come forward with the panel of individuals who wanted to provide general testimony opposed to all four bills.

Mr. Hillerby remarked he did not represent an industry that did not care about women. There were implications made by people who had testified that the insurance industry did not care about people, women in particular. That personally offended him.

Mr. Hillerby stated when mandating health insurance benefits, it was important to know who was impacted and more importantly who was not impacted. He referenced Exhibit M, a pie-graph which illustrated Nevada health insurance demographics. He pointed out 31 percent of the population was covered by the health plans which were cited in all four bills to mandate benefits. He thought it was important to note the rest of the population was not impacted by the policy decisions the legislators would make in that case.

It was very important to understand when an insurance company was mandated to provide certain coverage, a cost was created which had consequences. If a small business could not afford to provide health insurance for its employees, the business could drop employee health insurance coverage, or it could "go self-funded" and not be constrained to mandates. He noted it was not wise to create more uninsured people, which was already 18 percent of Nevada’s population. It concerned Mr. Hillerby very much that there were no solutions to address the uninsured population who had no access to coverage. The side effect to the state’s economy was that those individuals did not pay premium tax, which created a decline in the general revenue fund. Premium tax was the third highest revenue source in Nevada.

Mr. Hillerby noted, excluding Ms. Berman, the implication by others who testified that health plans did not provide coverage for the treatment of osteoporosis or mammograms was false. He added health plans had been the most aggressive to provide preventative care, because they understood the long-term consequences not only to the status of health care but to the economics of it as well. He noted A.B. 162 and A.B. 163 did not simply provide coverage but codified medical practice patterns. As referenced by Chairman Buckley, practice patterns changed as advancements in medical technology continued. A.B. 162 and A.B. 163 would change established protocol in the treatment of diseases. He remarked to construct health insurance policies with the most popular practice patterns for every disease set a dangerous precedent. Each disease had a very personal meaning to the people who were affected by it.

Marie Soldo, executive Vice President of Government Affairs, Sierra Health Services and the Nevada Association of Health Plans, stated for the record her mother was diagnosed with breast cancer at age 42, and died from it at age 67. Ms. Soldo’s half-sister had died of osteoporosis.

She read a letter from Doctor Christine Peterson, Chief Medical Officer of Sierra Health Services, parent company of Health Plan of Nevada and Sierra Health and Life (Exhibit N). In the letter Dr. Peterson expressed her concerns with A.B. 162 and A.B. 163. Most MCOs and HMOs already covered preventative diagnostic services such as mammograms and osteoporosis screening and at Sierra Health Services it was encouraged. A.B. 162 and A.B. 163 defined clinical practice guidelines for certain preventative services. Clinical guidelines changed as medical information changed. It seemed labor intensive and costly to define in legislative detail such diagnostic parameters, which should have been left to medical professionals and their active professional societies.

Dr. Peterson’s organization was monitoring preventative screening rates using externally audited reporting requirements. A.B. 162 and A.B. 163 failed to provide a vehicle for monitoring what was being done for non-health plan patients. Currently there was no mechanism to collect preventative screening data with the exception of childhood immunizations on non-healthplan patients. Consequently, it was not known whether or not those patients were receiving or being offered preventative services. She expressed her sincere concern that A.B. 162 and A.B. 163 did not provide a remedy to the large number of women in Nevada who did not have health insurance, and who may not have been receiving any screening for osteoporosis, breast cancer, or cervical cancer. Dr. Peterson regretted that she was not able to testify in person.

Ms. Soldo referenced a letter from Dr. Catherine Goring, M.D., in which Dr. Goring pointed out annual PAP smear recommendations had changed from what was in the current bill. Ms. Soldo noted A.B. 162 and A.B. 163 had no effect on state employees. The state employees who were members of Ms. Soldo’s organization’s health care plan were getting those benefits. She did not know if the "self insured" plan covered mammograms and osteoporosis screening.

Once per week Ms. Soldo’s organization offered extensive educational programs regarding women’s issues that included information on mammograms and osteoporosis screening. Because the clinical studies were changing rapidly, there was no benefit for her organization to deny diagnostic screening for breast cancer and osteoporosis. She was curious which MCOs did not provide those services. She did not think there was any data that showed diagnostic screening was not being covered by the health plans her organization represented.

Dr. Michael Daines noted he shared Ms. Soldo’s concerns. Clinical indications for mammograms and osteoporosis screening may change, and it would be difficult to change state statute. HHP provided mechanisms for women to receive mammograms, osteoporosis screening and appropriate treatment. HHP preferred to work with contracted providers to monitor medical literature for the most appropriate practices for applications of particular interventions. The rate of mammograms performed was monitored, and that information was provided to contracting physicians in order to help them improve their personal practices. An osteoporosis project had not yet begun, but he noted it would be important as a quality improvement mechanism.

Dr. Daines did not want to be on record as being opposed to diagnosis or treatment of osteoporosis or breast cancer. His only objection was it would be very problematic to format such clinical guidelines into a legal framework, it was the responsibility of the insurance plans and the physicians.

Chairman Buckley noted it would be beneficial for the committee during work session to know what types of diagnostic treatments each health care organizations was or was not providing.

Mr. Perkins asked if there would be an increase in premium costs if A.B. 162 or A.B. 163 went into effect. Mr. Hillerby explained with regards to A.B. 162 and A.B. 163, his organization already covered mammograms and osteoporosis screening. He noted the issue to be clarified was that A.B. 162 and A.B. 163 did not simply mandate benefits, it would result in codifying clinical guidelines. He did not recall if a particular cost was associated with A.B. 162 and A.B. 163.

Chairman Buckley asked Mr. Hillerby if there was any cost associated with A.B. 172 or A.B. 194. He said A.B. 172 was perplexing to him, because patients were not stabilized in the ER and discharged without further treatment. There was a certain process with which patients and doctors complied. There was no cost associated with A.B. 172, but he did not understand the need for the bill. He suggested Dr. Daines explain what happened after an individual was stabilized in an emergency room.

Dr. Daines clarified he was not speaking for every MCO. In his MCO, an individual was admitted to the hospital if it was recommended after he/she received emergency care. Through daily communication with the attending physician, there was an on-going evaluation of medical necessity of that person’s stay in the hospital. There was also participation in the discharge and aftercare planning for the patient.

In a non-contracted facility it would have to be determined whether the emergency patient was stable enough to be transported to a contracted hospital. That determination was made on a case by case basis. He surmised the only thing that might occur was a failure of a non-contracted hospital to communicate information to the MCO, which could result in a retrospective denial or review of the claim. He was unsure if that was the intent of A.B. 172.

Ms. Soldo stated A.B. 172 and A.B. 194 were not clear to her. She assumed the bills addressed non-contracted hospitals but was not sure. At a later time, she wanted further clarification on specific items in A.B. 172.

Chairman Buckley summarized Mr. Hillerby and Ms. Soldo’s testimony. Their objection to A.B. 162 and A.B. 163 was not due to cost factors, but to the codification of changing clinical criteria, the fact that it did not effect the rest of the population. If they were better able to ascertain the intent of A.B. 172 through speaking with the sponsor, they would be able to provide the committee their position and the potential cost impact. Chairman Buckley asked Ms. Soldo if Sierra Health Services used hospital intensivists. Ms. Soldo affirmed they used "hospitalists," agreeing the definition of "intensivists" was the same. She would provide more information at a later date. Chairman Buckley suggested the committee allow additional testimony at a later date, in order to further understand the use of hospital intensivists, and whether it was voluntary or required on the patient’s part to be treated by an intensivist.

Ms. Berman wanted to review the reasons why 28 other states added legislation similar to A.B. 163 in their revised statutes and 7 states added legislation similar to A.B. 162.

Ms. Giunchigliani wanted to clarify if there would be any cost impact from any of the bills presented, and if so she wanted the savings to be shown if the legislation did not pass.

Dr. Daines did not think there would be any cost impact due to providing mammograms, he noted there were active campaigns to increase the use of mammograms.

Ms. Giunchigliani asked even with the age changes and the stipulations the statute had, there would not be a cost impact because MCOs covered such things as mammograms already. To which Dr. Daines replied "No." He noted there were some osteoporosis screening exams, which were very inexpensive. A.B. 162 mandated the coverage of any radiological test, some of which ranged from $200 to $700. The bill therefore eliminated the discussion between health plans and the attending physician, the contracting primary care physician, or the radiology department as to which was the most cost effective way to perform the screenings. There were legitimate differences of opinion as to what constituted sufficient reason to perform a screening exam. It was possible to estimate what a woman’s risk level was if the doctor was able to talk to the patient before the screening was performed. To codify the requirement that radiography be used limited the flexibility of the health plan to work with their providers to find a scientifically validated and cost effective approach.

Ms. Giunchigliani asked if only particular HMOs covered mammograms and osteoporosis screening, or if every facility in the State of Nevada that belonged to Hometown Health and Sierra Health Services, covered exactly what was noted in A.B. 162 and A.B. 163.

Ms. Soldo speculated all of the facilities under Sierra Health Services covered mammograms and osteoporosis screening. She stated it was extremely regrettable the women who had the most need did not receive treatment and A.B. 162 and A.B. 163 would not change that fact.

Ms. Giunchigliani noted the committee was very sensitive to the uninsured and underinsured. The committee may want to consider a resolution, calling on congress to make such modifications. She added it was important the women who could be reached also have those same benefits.

Ms. Soldo stated a survey would be conducted of all the health plans in her organization, and she would provide it for the committee to review. Chairman Buckley agreed that would be very helpful.

Mr. Hettrick referred to A.B. 172, section 1, subsection 2, lines 1 and 2, and noted the phrase "If a managed care organization does not immediately affirmatively deny", and interpreted that to mean if an organization did not deny coverage, the organization was liable for coverage. He pointed out the organization was already liable because they had not denied coverage, there needed to be very significant language changes to the bill.

Chairman Buckley noted in emergency room treatment prior authorization was not needed, because it was an emergency. She asked if the treating physician needed prior authorization to admit a patient for further observation after he/she had been stabilized in the emergency room. Ms. Soldo stated she would retrieve that information from the health plans. She agreed with Dr. Daines that A.B. 172 focused on non-contracted hospitals, but it was clear that prior authorization was not required for emergency room services, and procedures required to stabilize the patient.

Mr. Hettrick contended NRS 695G, subsection 1a, mandated exactly what the MCOs were already required to do.

Mr. Hillerby clarified the cost of implementing A.B. 162 and A.B. 163 could not be calculated because his organization already provided coverage for mammograms and osteoporosis screening. The cost of routine mammograms and osteoporosis screenings for every woman at a certain age could not be actuarially determined because, through medical consultation, it may be determined those diagnostic procedures were not necessary. Chairman Buckley noted the cost would fluctuate depending if a $25 or a $700 osteoporosis screening was performed.

Mr. Hillerby explained if a benefit not already covered by a health care plan was mandated, the actuaries could then determine what the cost implication would be. Chairman Buckley asked Mr. Hillerby to consult the medical directors present and Assemblywoman Ohrenschall, and report back to the committee to clarify if prior authorization was required in order to admit an individual to the hospital after he/she had received emergency care.

Mr. Nolan asked if a patient who complained of chest pains was admitted to and treated in the emergency room, and it was determined he/she only had indigestion and was subsequently discharged, was it possible for the insurer to deny benefits because the incident was not deemed to be an emergency. To which Mr. Hillerby answered, "No." Chairman Buckley noted that was addressed in A.B. 156 from the 69^th Session. Mr. Nolan said he believed A.B. 156 did not prohibit the denial of benefits to be paid in that instance. Ms. Soldo stated her organization did cover those cases. Chairman Buckley assured Mr. Nolan that retrospective review could not be used to deny benefits if a person had heartburn rather than symptoms of a heart attack.

Bob Ostrovsky represented Nevadans for Affordable Health Care, an organization of concerned citizens and businesses. He spoke in opposition to all four bills. His organization believed health care should be high quality, affordable, and accessible with limited or no government intervention. There was a cost associated with any mandated benefit; increasing health care costs produced fewer insured individuals. According to Mr. Ostrovsky, a 10 percent increase in insurance premiums in Nevada would result in 25,400 t 28,011 fewer insured people in the State. He noted if the legislature did not adopt any mandated benefits on any particular bill, the cost of a non-HMO family medical plan would still rise 7.25 percent, and HMO family medical plans would increase 5.9 percent in 1999. He noted preventative health care did save money in the long run. His organization had great concerns that mandated benefits had an additive cost, which would have some impact on which health care benefits employers were able to provide to their employees.

Larry Hardy, Legislative Chairman for the Nevada Association of Health and Life spoke next. He noted agents from his organization wrote 90 percent of the group health insurance and HMO business in Nevada, which made them uniquely qualified to address those bills. He read a letter from John Harleman, Controller of Mallard Group, Exhibit O, which read "As an employer I do not want anymore medical insurance mandates, for employees. The insurance rates are already too high. We are a small employer and cannot absorb any more costs." Mr. Hardy noted there were 12 similar letters in Exhibit O. There was a 20 to 30 percent insurance premium rate increase statewide. Small businesses were being seriously effected; they were cost shifting to their employees, as insurance rates increased deductibles increased.

Mr. Hardy noted his wife was a breast cancer survivor, and he was thankful her treatment was covered by his insurance. He pointed out she had an osteoporosis screening test performed and was diligent in her exercise program, noting sometimes the individual had to take responsibility for his/her own health care.

Bob Bishop, President of the Nevada Health Underwriters Association, noted his organization covered over 300 employers, and several thousand employees. He explained the market place was still struggling with the loss of the Health Insurance Portability and Affordability Act of 1997 (HIPAA). Even though there were great efforts to bring health insurance to "the masses," nothing in the HIPAA legislation stipulated it was going to be affordable. Blue Cross/Blue Shield had recently had a 27.9 percent rate increase, and Unicare had a 30 percent increase. He was not against the particular mandates addressed in the hearing, but was concerned with the cost of mandates. He noted in the 1960’s a family health care policy could be purchased for $25 to $30, in 1999 that cost could be $1333 or more.

He pointed out that the HMOs did not write all of the business in the state, there were also carriers and Preferred Provider Organizations (PPOs) writing as well. He pointed out the PPOs were having problems covering the mandated legislation that was passed by HIPAA the year before. The mandates did not affect the largest employer in the state because they were self-insured and covered by ERISA.

Mr. Bishop read a letter from Randall M. Tuggle, M.D., who had a small practice with 14 employees (Exhibit O). Mr. Randall wrote: "Our health insurance premiums are high enough that we have had to lower our benefit package we offer our employees, due to the increasing cost of health insurance. Any additional mandates which will increase the cost of health insurance will force us to terminate offering this benefit to our employees."

Mr. Ostrovsky said his organization would be happy to work with the other parties present.

Chairman Buckley adjourned the hearing at 6:30 p.m.

RESPECTFULLY SUBMITTED:

Meagen Colard,

Committee Secretary

APPROVED BY:

Assemblywoman Barbara Buckley, Chairman

DATE: