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December 23, 2011 VIA E-MAIL EssentialHealthBenefits@cms.hhs.gov Center for Medicare and Medicaid Services United States Department of Health and Human Services Dear Sirs/Madams: We appreciate this opportunity to comment on the December 16, 2011 Essential Health Benefits (EHB) Bulletin. In that Bulletin, the Department sets forth its inclination to allow states to choose an EHB by reference to an existing plan that can be used as a benchmark. We oppose this approach. Advocacy for Patients with Chronic Illness is a 501(c)(3) tax exempt organization that provides free services to patients with chronic illnesses nationwide in areas including health insurance. Most of our health insurance work involves appealing denials of coverage, although we also assist many individuals to find and select health insurance plans all over the United States. Thus, we are in a position to understand the limits of coverage and the interests of patients in different states. Since we are based in Connecticut a mandate-rich state we could simply thank the Department for virtually insuring that our states mandates will remain intact, at least for several years. Our controversial Exchange Board already had begun toying with the idea of taking this opportunity to eliminate mandates on the ground that the state would have to cover the cost of coverage over and above the EHB. Now, since three of the four benchmark options are plans covered by state law, the mandates would be included in the EHB without a cost to the state, at least in the short term. Thus, for our state, the solution you propose might well make sense again, in the short term. However, because we serve clients nationwide, we cannot limit our response to what is good for consumers in Connecticut. Other than the federal employee plan options, which the Department knows will provide comprehensive coverage, the Departments approach guarantees nothing whatsoever to consumers in other states who will be limited to one of the three state-based benchmarks the Department has identified. Californias largest HMO, for example, most likely would be a Kaiser plan; however, the Kaiser plans exclude all services not offered by Kaiser physicians and facilities, which, in our experience, has left patients without treatment for sleep

United States Department of Health and Human Services December 23, 2011 Page 2 of 5 apnea, obesity, pulmonary hypertension, and lifesaving treatment for acute disseminated encephalomyelitis and those are only the omissions of which we are aware. Blue Cross of Mississippi completely dominates the health insurance market in that state; they refuse to even consider well-supported treatment for gastroparesis, or even to provide a pre-service denial so that the patient can appeal their denial of coverage. The Departments inclination to allow states to choose a benchmark allows them to maintain the status quo precisely that which the Affordable Care Act was designed to change. Indeed, in states that do not choose an EHB, the default benchmark would be the largest plan in the largest product in the states small business market. States that oppose health reform have fewer mandates, fewer consumer protections, and, thus, less consumer-oriented benefit packages. It simply makes no sense to choose, as a default benchmark, a plan that most likely already is lacking. Further, the Departments approach expressly separates the issue of coverage from the issue of cost, contrary to the Institute of Medicines suggestions. However, when insurers design plans, they balance cost against benefit design. For example, we would expect high deductible plans to have a different scope of benefits from a lower cost sharing plan, which may have a richer scope of benefits and a much higher premium. Since the EHB will be required of bronze level plans, the actuarial value of the EHB package is extremely relevant. Choosing a benchmark plan to set the EHB without consideration of cost ignores the real relation between coverage and cost. Although Congress listed ten categories of services that should be included in the EHB, the Department has acknowledged that all of the possible benchmark plans do not cover all ten of those categories of services, pointing to habilitative services and pediatric dental and vision services. However, there is much more that is excluded from what could be benchmark plans in many states within the ten service categories. For example, although most insurance plans cover durable medical equipment, most do not cover ostomy supplies. Ostomates in states without mandatory coverage of such supplies are forced to find funds in addition to insurance premiums, deductibles, coinsurance, and copays to pay for something that they literally cannot function without. Similarly, most insurers do not cover enteral formula to provide nutrition to patients who cannot eat by mouth a life-threatening coverage gap for many with digestive diseases, including infants and children. Failing to set a standard that all plans must meet only perpetuates these omissions from coverage. Perhaps the most important examples of areas where a category of service is covered, but plans routinely omit coverage of subsets within the category, occur with respect to prescription drugs. First, in order to ensure that patients with chronic illness have access to the medications they need to stop the progression of their diseases, insurers practice of placing expensive medications in specialty tiers, and subjecting consumers to coinsurance for these medications instead of a standard prescription drug copayment, must end. Specialty tier classifications disproportionately shift the cost of certain medications, such as injectibles, onto the shoulders of patients suffering from chronic illnesses those who need treatment (and, thus, coverage) the most. For example, medication to treat multiple sclerosis can cost up to $3,000 or more per month. If covered under a standard pharmacy benefit, an MS patient might only pay a $55 copayment, whereas if the drug is

United States Department of Health and Human Services December 23, 2011 Page 3 of 5 specialty tiered with a typical coinsurance rate of 20 percent, the cost to that patient could be at least $600 per month for just one medication. 1 Not only does this severely limit access to medications that may keep a chronic illness from spinning out of control and, thus, becoming far more expensive to treat, but it also discriminates against patients who need these medications. Allowing states to use existing benchmarks without addressing the scope of coverage within the ten categories will perpetuate this omission, which disparately impacts patients with multiple chronic conditions who are on several prescription medications. Second, orphan drugs 2 and humanitarian use devices 3 are used to treat patients with rare diseases because there are not enough people with the disease to justify a large clinical trial. The consequences of this have been grave for patients with rare diseases; insurance companies routinely deny coverage of orphan drugs and humanitarian use devices on the basis that they are experimental/investigational. For example, gastric electrical stimulation (GES), an electrical device used to alleviate the nausea and vomiting that patients with gastroparesis suffer secondary to their disease, is not covered by some insurance companies because of its status as a humanitarian use device (HUD). Insurers fail to recognize that GES has approval from the FDA in the form of a HUD only because fewer than 4,000 patients per year are affected with gastroparesis so severely as to need the device. To deny coverage of GES -- indeed, all orphan drugs and HUDs -is akin to denying coverage simply because these patients are unlucky enough to suffer from rare diseases. Allowing states to use existing benchmarks will perpetuate these coverage gaps. Third, insurance companies routinely deny coverage of treatments when they are prescribed to treat something other than that for which they are FDA-approved. Although this might appear to be a good practice on its face, the reality is that this gap in coverage leaves many individuals especially those with rare diseases without access to the treatments they need. For example, we have filed a number of appeals on behalf of patients with neuromyelitis optica (NMO), an uncommon autoimmune disease in which the patients own immune system attacks her optic nerves and spinal cord. The only treatment options for this disease are intravenous infusions of rituximab or immunoglobulin (IVIg), which are not FDA-approved for the use in NMO, and, thus, often are not covered by insurance companies. There simply are no other treatment options for these patients and, yet, they are left with no insurance coverage because the treatments that do work are considered off-label.
1

See Puckrein and Wartman, Specialty Tiers: Unequal Treatment, National Minority Quality Forum Issue Brief 3, August 2011 < http://www.nmqf.org/IB3SpecialtyTiersFinal.pdf> (accessed December 12, 2011).

2 The Orphan Drug Act provides certain benefits to manufacturers to develop drugs for rare diseases those that affect fewer than 200,000 people in the United States, who otherwise would have no financial incentive to develop such drugs. Pub. L. No. 97-414, 96 Stat. 2049 (1983) (codified as amended in scattered sections of 21 U.S.C. and 42 U.S.C.). See 21 U.S.C. 360bb and U.S.C. 360ee(b)(2). 3

The Humanitarian Use Device program enables manufacturers of devices that are intended to benefit patients suffering from diseases that affect fewer than 4,000 individuals in the United States per year to get FDA approval in the form a humanitarian device exemption. See 21 C.F.R. 814.3(n) and 21 C.F.R. 814.100, et seq.

United States Department of Health and Human Services December 23, 2011 Page 4 of 5 Permitting states to choose an existing plan as an EHB benchmark will perpetuate this practice of leaving people with rare diseases without treatment options. Similarly, mental health parity remains elusive, and signaling to states and to plans that the status quo is acceptable will only perpetuate this. Residential treatment for mental health issues from reactive attachment disorder to eating disorders is a battle that cannot be won quickly enough to keep someone inpatient when an insurer decides to limit coverage quickly enough to avoid harm to the patient, or by the patient, to another. Failing to state quite clearly that standards for residential psychiatric treatment must be equivalent to standards for inpatient medical/surgical hospitalizations is a missed opportunity to correct this inequity once and for all. Thus, the Department should establish a floor perhaps even a slightly modified federal employee plan option below which no state can go in defining an EHB. There is great virtue to a nationally uniform bottom line, something that every American could count on, and that will allow consumers to compare plans. Indeed, Congress intended to impose such a nationally uniform EHB package when it authorized the Secretary rather than the states to design the EHB. Allowing states to deviate from the benchmarks to offer substantially equal benefits further undermines the goal of uniformity, making it more difficult for consumers to compare plans. Further, this approach begs the question of who will decide what is substantially equal. Indeed, we disagree with the Departments belief that flexibility in plan design is desirable. Insurers currently have all of the flexibility they could want (aside from mandates), and they use that to consumers detriment, failing and refusing to cover medically necessary care routinely and unchecked. Using Medicare Part D as a model for cross-category substitutions ignores the confusion and harm consumers face in not being able to predict which plans will cover their needs. We cannot begin to count the number of times a patient with Medicare Part D reported to us that they did not know that their medication would not be covered until after they had selected a plan, at which point they were locked in for a year. We do not believe that the Department can establish sufficiently rigorous standards for substitution to ensure that the medically verifiable needs of consumers are met. Even in states like Connecticut, which are mandate-rich, the Departments approach creates an incentive to eliminate mandates important coverage guarantees over the next two years because the Bulletin notes that, in 2016, the issue of paying for mandates will be revisited. We see no real benefit to delaying the need to address this elephant in the room that always has been a concern with respect to the EHB. In the end, establishing a federal floor that states can exceed if they choose leaves states with the flexibility the Department desires without subjecting consumers to the risk that their state will choose a benchmark that leaves them with a coverage gap, or that an insurer will offer substantially equal benefits that are inadequate. Ensuring that all Americans have access to the health care they need is critical. Congress passes many laws that create floors above which states may legislate. The Affordable Care Act and, in particular, the EHB provision was intended to be such a law, as well it should be.

United States Department of Health and Human Services December 23, 2011 Page 5 of 5 Finally, with respect to habilitative services, we strongly urge the Department to define this benefit to include PT, OT and ST needed to maintain function. For example, as we set forth in our detailed comments on the EHB submitted prior to the issuance of the guidance, we worked with a patient with Marie Charcot-Tooth disease, a neuropathic disorder that is characterized by loss of muscle tissue and touch sensation in all four extremities. This patient required regular physical therapy visits in order to keep her feet, legs, hands, and arms from shriveling to the point at which she could not get clothes on. Yet, her insurance company tried to discontinue her physical therapy visits because she was not demonstrating improvement; they did not recognize that simply not getting worse was medically necessary. The requirement that the patient show improvement is quite common in commercial insurance. The Department should define habilitative services so as to include services necessary to maintain and preserve function. In sum, we disagree with the Departments approach and call on the Secretary, instead, to define the EHB, as Congress directed her to do. In so doing, cost and coverage within the ten categories should be considered, and a minimum, uniform, nationwide floor of coverage should be established. Thank you for considering our views. Sincerely,

Jennifer C. Jaff, Esq.

Admitted to practice law in Connecticut, New York and the District of Columbia. Advocacy for Patients is a 501(c)(3) tax-exempt organization and does not charge patients for its services. Advocacy for Patients is funded by, among other sources, grants from foundations and companies that engage in health care-related advocacy, manufacturing, delivery and financing. A list of grantors will be furnished upon request.
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