Step Forward for Oral Chemotherapy Bill

The Assembly Committee on Health approved a bill Tuesday that would require health insurers to provide oral chemotherapy therapy to their members with a maximum out-of-pocket $100 co-pay per prescription. Another version of AB 219 by Assembly member Henry Perea (D-Fresno) passed the Legislature last year, but was vetoed by the governor.

“This bill would ensure cancer patients have affordable access to the most appropriate cancer treatment covered by insurers,” Perea said. “When the governor vetoed a similar bill last year, he encouraged me to work with his administration to design a policy that will work for California. AB 219 represents a new strategy to make oral chemotherapy affordable.”

According to Perea, even a fully insured patient can spend $5,000 a month on oral chemotherapy medication, while intravenous treatments are covered by a small co-pay, no matter what the drug costs. So he wants to spread the cost over the entire insured population.

“We’re talking about one penny per member per month,” Perea said.

According to Nick Louizos, director of legislative affairs for the California Association of Health Plans, the higher cost of oral chemotherapy compared to IV medication should not be borne by everyone. If the problem of high cost needs to be addressed, he said, maybe the drug companies who charge the high prices should be part of the solution.

“We’re all made of the same stuff, we’ve all had people who have been touched by cancer, but we fundamentally disagree with … this bill,” Louizos said. “The underlying cost of that drug is very expensive. In some cases, the cost of that prescription drug can be almost $11,000 per prescription. Health plans do not control that. … Share of the cost of the drug has to be included, or premiums will be impacted.”

In addition to higher premiums, Louizos said AB 219 would set a dangerous precedent, setting a price for a product that has so little relation to its cost. He also argued against establishing another essential benefit on top of those the state has already determined.

The concern, he said, is “interaction with the exchange and with health care reform. In order to successfully launch the exchange, the details need to be locked down, and much of that work has been done. The essential health benefits have been developed,” Louizos said.

“This bill would institute a co-pay structure that varies from those standardized benefit designs,” he said. “We worry that this bill, and several others pending in the legislature, will complicate the launch of the exchange.”

The bill passed committee on a 14-1 vote and now heads to the Assembly Committee on Appropriations.

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