Enacts "Hannah's law"; requires certain insurance policies to include coverage for the cost of enteral formulas for the treatment of eosinophilic disorders

BILL NUMBER:S5034A

Title of bill

An act to amend the insurance law, in relation to requiring certain health insurance policies to include coverage for the cost of enteral formulas for the treatment of eosinophilic esophagitis and related eosi- nophilic disorders

Purpose

To update and modify existing laws requiring the coverage of enteral formulas.

Summary of provisions

Section 1: The short title - Hannah's Law.

Sections 2: Through four amend Insurance Law sections 3216(i) (21), 3221(11) and 4303(y), respectively, to specify that the existing requirements concerning coverage of enteral formulas under prescription drug plans is also applicable to policies providing medical, major medical or similar comprehensive-type coverage, whether administered orally or via tube feeding, and applicable to eosinophilic esophagitis and related eosiniphilic disorders. It also removes the existing $2,500 annual cap applicable to these enteral formulas.

Section 5: Makes a conforming amendment to Insurance Law section 4322(b) (25), applicable to standardized individual enrollee direct payment contracts offered by health maintenance organizations.

Section 6: Is the effective date.

Justification

This legislation is necessitated due to a flaw in existing Insurance Law regarding enteral formula coverage requirements encountered by the fami- ly of Hannah Devane. Hannah is a six year old girl who suffers from eosinophilic esophagitis, a potentially fatal condition that makes it impossible for her to eat most foods.

Children with eosinophilic esophagitis and similar disorders can only obtain nourishment from special, enteral formulas, which in some cases may be ingested orally but in other circumstances must be administered via a feeding tube. In the case of Hannah, the life sustaining formula can be taken orally and comes with a cost of approximately $1,200 per month, or $14,400 annually.

Hannah's medical insurance provider already provides coverage for the cost of enteral formulas, but only under conditions that require tube feeding. This company policy gives rise to the circumstance whereby Hanna's parents must incur significant out-of-pocket costs for the enteral formula needed to sustain her life, or choose to have the cost of the formula Covered but delivered through a feeding tube.

The purpose of Hannah's Law is to rectify this anomaly and to ensure. adequate coverage for those children with these rare diseases. It should also be noted that, pursuant to a 2006 settlement with the Attorney General, a different insurer was ordered to cease its denial of an enteral formula claim on the ground that a specific enteral formula was not tube fed.

Legislative history

A.2188 of 2010.

Fiscal implications

Miniscule cost to government health plans to expand an already existing health benefit requirement.

Effective date

First of January next succeeding enactment and applicable to policies and contracts issued, renewed, modified, altered or amended on or after such date.