Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law sets forth a schedule of covered benefits under the Medi-Cal program.

This bill would, commencing on July 1, 2024, add pharmacogenomic testing as a covered benefit under Medi-Cal, as specified. The bill would define pharmacogenomic testing as laboratory genetic testing that includes, but is not limited to, a panel test, to identify how a persons genetics may impact the efficacy, toxicity, and safety of medications.

The bill would condition implementation of this benefit coverage on receipt of any necessary federal approvals and the availability of federal financial participation. The bill would authorize the department to implement these provisions through all-county letters or similar instructions.

The bill would also make related legislative findings.

Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law sets forth a schedule of covered benefits under the Medi-Cal program.

This bill would, commencing on July 1, 2024, add pharmacogenomic testing as a covered benefit under Medi-Cal, as specified. The bill would define pharmacogenomic testing as laboratory genetic testing that includes, but is not limited to, a panel test, to identify how a persons genetics may impact the efficacy, toxicity, and safety of medications.

The bill would condition implementation of this benefit coverage on receipt of any necessary federal approvals and the availability of federal financial participation. The bill would authorize the department to implement these provisions through all-county letters or similar instructions.

The bill would also make related legislative findings.

Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law sets forth a schedule of covered benefits under the Medi-Cal program.

This bill would would, commencing on July 1, 2024, add pharmacogenomic testing as a covered benefit under Medi-Cal, as specified. The bill would define pharmacogenomic testing as laboratory genetic testing that includes, but is not limited to, a panel test, to identify how a persons genetics may impact the efficacy, toxicity, and safety of medications, including medications prescribed for behavioral or mental health, oncology, hematology, pain management, infectious disease, urology, reproductive or sexual health, neurology, gastroenterology, or cardiovascular diseases. medications.

The bill would also make related legislative findings.

Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law sets forth a schedule of covered benefits under the Medi-Cal program.

This bill, the Pharmacogenomics Advancing Total Health for All Act (PATH for All Act), subject to an appropriation, bill would add pharmacogenomic testing as a covered benefit under Medi-Cal, as specified. The bill would define pharmacogenomic testing as laboratory genetic testing, by a laboratory with specified licensing, accreditation, and certification, to identify how a persons genetics may impact the efficacy, toxicity, and safety of medications. The bill would cover the benefit under Medi-Cal if a medication, as defined, is being considered for use, or is already being administered, and is approved for use, in treating a Medi-Cal beneficiarys condition and is known to have a gene-drug or drug-drug-gene interaction that has been demonstrated to be clinically actionable, as specified, if the test is ordered by an enrolled Medi-Cal clinician or pharmacist. laboratory genetic testing that includes, but is not limited to, a panel test, to identify how a persons genetics may impact the efficacy, toxicity, and safety of medications, including medications prescribed for behavioral or mental health, oncology, hematology, pain management, infectious disease, urology, reproductive or sexual health, neurology, gastroenterology, or cardiovascular diseases.

The bill would authorize the department to implement the above-described provisions through all-county or plan letters, or similar instructions, until the department promulgates regulations. The bill would also make related legislative findings.

Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law sets forth a schedule of covered benefits under the Medi-Cal program.

This bill, the Pharmacogenomics Advancing Total Health for All Act (PATH for All Act), subject to an appropriation, would add pharmacogenomic testing as a covered benefit under Medi-Cal, as specified. The bill would define pharmacogenomic testing as laboratory genetic testing, by a laboratory with specified licensing, accreditation, and certification, to identify how a persons genetics may impact the efficacy, toxicity, and safety of medications. The bill would cover the benefit under Medi-Cal if a medication, as defined, is being considered for use, or is already being administered, and is approved for use, in treating a Medi-Cal beneficiarys condition and is known to have a gene-drug or drug-drug-gene interaction that has been demonstrated to be clinically actionable, as specified, if the test is ordered by an enrolled Medi-Cal clinician or pharmacist.

The bill would authorize the department to implement the above-described provisions through all-county or plan letters, or similar instructions, until the department promulgates regulations. The bill would also make related legislative findings.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 425

Author:(Alvarez)

As Amended Ver:September 1, 2023

Majority vote

SUMMARY

Specifies that pharmacogenomic testing, as defined, is a covered benefit under Medi-Cal, subject to utilization controls and evidence-based clinical practice guidelines.

Senate Amendments

1. Condition implementation on federal approvals have been obtained and federal financial participation is available and not otherwise jeopardized.
2. Strike provisions that specified a range of health conditions for which pharmacogenomics testing can be used.
3. Authorize the Department of Health Care Services to implement the bill’s provisions through bulletins or similar non-regulatory instructions.
4. Clarify coverage is based on evidence-based clinical practice guidelines (in addition to utilization controls).

COMMENTS

1. Pharmacogenomics. According to the Centers of Disease Control and Prevention (CDC), pharmacogenomics is an important example of the field of precision medicine, which aims to tailor medical treatment to each person or to a group of people. According to the National Human Genome Research Institute under the federal National Institutes of Health, pharmacogenomics uses information about a person's genetic makeup, or genome, to choose the drugs and drug doses that are likely to work best for that particular person. This field combines the science of how drugs work, called pharmacology, with the science of the human genome, called genomics.

Pharmacogenomic testing is performed using a cheek swab or blood sample, which is then sent to a laboratory for analysis. The CDC indicates doctors are starting to use pharmacogenomic information to prescribe drugs, but such tests are routine for only a few health problems, including certain cancers. For instance, someone with a particular genetic makeup may have an adverse reaction to a certain treatment. However, given the field's rapid growth, pharmacogenomics is soon expected to lead to better ways of using drugs to manage heart disease, cancer, asthma, depression and many other common diseases.

Invitae Corporation, the sponsor of this bill, points out improving coverage of pharmacogenomics is important to improve health equity, given women and people of color are more likely to experience negative outcomes and adverse drug events resulting from a medication they take. Due to historical practices that excluded women and people of color from clinical trials, Invitae notes that many of the recommended doses and medications are predicated on evidence generated by studies involving primarily non-Hispanic white men. For this reason, Invitae asserts improving coverage for pharmacogenomics testing that can help optimize medication will have a disproportionate positive impact on women and people of color.

1. California Health Benefits Review Program (CHBRP) analysis. CHBRP, an analytical team housed in the University of California with a statutory charge to review legislative benefit mandates, analyzed the impact of this bill. CHBRP reviewed a similar bill last year, SB 1191 (Bates) of 2022. Components of the SB 1191 analysis relevant to this bill include the following:
   1. Impact on Medi-Cal expenditures. Several studies that found pharmacogenomics testing could lead to significant cost offsets, including a reduction in emergency room utilization, unplanned hospital admissions, and outpatient visits, but CHBRP could not make a projection of actual savings. There is some evidence that the use of pharmacogenomic testing for specific types of diseases is cost-effective, but this varies significantly by disease, treatment, and outcomes assessed.
   2. Medical effectiveness.
      1. The use of pharmacogenomics in conjunction with a comprehensive medication management program has been shown to help identify medication appropriateness, improve adherence, and reduce adverse reactions in a more comprehensive way than either of these approaches can alone. More than 90% of patients are thought to carry at least one genetic variant that should prompt a change in dosing or medication if certain medications are prescribed.
      2. Evidence on the effectiveness and clinical utility of pharmacogenomic testing varies significantly across conditions. Some studies have found that pharmacogenomic testing leads to changes in medications and a reduction in hospital admissions. However, most patients who receive pharmacogenomic testing remain on their previously prescribed medication regimen

CHBRP also notes systematic reviews of the efficacy of pharmacogenomics testing have described the weakness of relevant literature as having insufficient sensitivity analyses, heterogeneity in study designs and populations, and low quality of data and methodologies.

1. Current Medi-Cal Coverage. According to the CHBRP analysis of SB 1191, all Medi-Cal beneficiaries have coverage for biomarker testing, including pharmacogenomics testing, that is supported by medical and scientific evidence and is determined medically necessary. However, Medi-Cal coverage of pharmacogenomic testing is not clearly specified. In addition, in spite of the status of some pharmacogenomics-related services codes as non-benefits, they can be covered by Medi-Cal if specified conditions are met. The Medi-Cal provider manual specifies Medi-Cal may provide reimbursement for a non-benefit with an approved Treatment Authorization Request (TAR) if medical necessity is established. This bill is intended to clarify Medi-Cal coverage for pharmacogenomic testing and clearly specify the parameters of coverage.

According to the Author

Having Medi-Cal coverage of pharmacogenomic testing can improve clinical outcomes for many individuals who are going through mental health and physical health problems. As an example, the author indicates a high school student in the author's district suffered from depression for years, cycling through medications, none of which worked to resolve the student’s symptoms. The student finally learned of pharmacogenomic testing through a Facebook support group. The author explained the student gained access to the test and was able to use the results to identify the most effective mental health medication for the student, and the student’s symptoms dramatically improved with the right medication.

Arguments in Support

Invitae Corporation, this bill's sponsor, indicates several commercial insurance plans cover pharmacogenomic testing for their beneficiaries, and this bill will mitigate disparities between those covered by public and commercial coverage, as well as open up access to this potentially life-saving test. Biocom, in support, states this bill will reduce adverse drug events, improve clinical outcomes, reduce healthcare spending, and create more equitable access to better medication management.

Arguments in Opposition

There is no known opposition.

FISCAL COMMENTS

According to the Senate Appropriations Committee, unknown, ongoing costs in the Medi-Cal program, likely tens of millions (General Fund and federal funds), due to increased utilization of pharmacogenomic testing.

VOTES:

ASM HEALTH: 14-0-1

YES: Wood, Waldron, Aguiar-Curry, Arambula, Boerner Horvath, Flora, Vince Fong, Maienschein, McCarty, Joe Patterson, Rodriguez, Santiago, Villapudua, Weber

ABS, ABST OR NV: Wendy Carrillo

ASM APPROPRIATIONS: 15-0-1

YES: Holden, Megan Dahle, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Hart, Lowenthal, Mathis, Papan, Pellerin, Sanchez, Weber, Ortega

ABS, ABST OR NV: Robert Rivas

ASSEMBLY FLOOR: 80-0-0

YES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Cervantes, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones- Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Rendon

SENATE FLOOR: 39-0-1

YES: Allen, Alvarado-Gil, Archuleta, Ashby, Atkins, Becker, Blakespear, Bradford, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Newman, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ABS, ABST OR NV: Caballero

UPDATED

VERSION: September 1, 2023

CONSULTANT: Lisa Murawski / HEALTH / (916) 319-2097 FN: 0001681

 THIRD READING  

Bill No: AB 425

Author: Alvarez (D), et al.

Amended: 9/1/23 in Senate

Vote: 21

SENATE HEALTH COMMITTEE: 11-0, 6/28/23

AYES: Eggman, Nguyen, Glazer, Gonzalez, Hurtado, Limón, Menjivar, Roth, Rubio, Wahab, Wiener

NO VOTE RECORDED: Grove

SENATE APPROPRIATIONS COMMITTEE: 7-0, 9/1/23

AYES: Portantino, Jones, Ashby, Bradford, Seyarto, Wahab, Wiener

ASSEMBLY FLOOR: 80-0, 5/31/23 - See last page for vote

SUBJECT: Medi-Cal: pharmacogenomic testing

SOURCE: Invitae Corporation

DIGEST:

This bill adds pharmacogenomic testing, as defined, to the Medi-Cal schedule of benefits.

ANALYSIS:

Existing law:

1. Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), under which low-income individuals are eligible for medical coverage. [WIC §14000, et seq.]
2. Establishes a schedule of benefits under the Medi-Cal program, which includes benefits required under federal law and benefits provided at state option but for which federal financial participation through Medicaid is available. The schedule of benefits includes and Rapid Whole Genome Sequencing for any Medi-Cal beneficiary who is one year of age or younger and is receiving inpatient hospital services in an intensive care unit and prescription drugs. [WIC §14132]

This bill:

1. Adds pharmacogenomic testing to the Medi-Cal schedule of benefits, subject to utilization controls and evidence based clinical practice guidelines starting July 1, 2024.
2. Defines “pharmacogenomic testing” as laboratory genetic testing that includes, but is not limited to, a panel test to identify how a person’s genetics may impact the efficacy, toxicity, and safety of medications.
3. Conditions implementation on the receipt of any necessary federal approvals and the continuation of federal financial participation. Allows DHCS to implement via letter, bulletin, or similar instructions without taking any further regulatory action.
4. States that it is the intent of the Legislature to benefit the total health, including mental and physical health, of Medi-Cal beneficiaries by using available, evidence-based technologies to assess how an individual’s genetics impact their metabolism of a variety of medications and to curb the opioid crisis in California, which is exacerbated by genetic changes in individuals that create unintended “high” feelings or no pain relief, prompting increases in opioid dependency. States that through Medi-Cal coverage of pharmacogenomic testing, the safety and efficacy of medications will improve and lead to progress in health equity as well as reduction of adverse drug events, opioid dependency, emergency department visits, and hospital admissions.

Comments

1. Author’s statement. According to the author, this bill was introduced because a high school student in his District came and shared her story. She had suffered from depression for years, cycling through medications, none of which worked to resolve her symptoms, until finally, she learned of pharmacogenomic testing through a Facebook support group. She thankfully had access to the test and was able to use the results to identify the most effective mental health medication for her. Once she was on the right medication, her symptoms dramatically improved. She recently asserted that pharmacogenomic testing “saved her life” and is now an advocate for ensuring access to the test. This bill would create pharmacogenomic testing access for patients in our Medi-Cal Program. Medi-Cal coverage of pharmacogenomic testing can improve clinical outcomes for many individuals who are going through mental health and physical health problems.
2. CHBRP analysis. AB 1996 (Thomson, Chapter 795, Statutes of 2002) requests the University of California to assess legislation proposing a mandated benefit or service and prepare a written analysis with relevant data on the medical, economic, and public health impacts of proposed health plan and health insurance benefit mandate legislation. CHBRP was created in response to AB 1996, and reviewed a similar bill last year, SB 1191 (Bates). Key findings include:
3. Benefit coverage. Based on queries of the Medi-Cal managed care plans, CHBRP found that broadly speaking, all Medi-Cal beneficiaries have coverage for biomarker testing, including pharmacogenomics testing, that is supported by medical and scientific evidence and is determined medically necessary. Pharmacogenomics testing can be performed before a beneficiary begins taking a medication with a companion diagnostic indication (as listed by the FDA), concurrently when a beneficiary is taking a medication with a significant biomarker reference in the FDA drug label, as a panel, or pre-emptively. However, pharmacogenomics testing is not as commonly performed pre-emptively as compared to the other reasons for testing. Because this bill would create clarity of existing benefit coverage, CHBRP concludes that it would, in essence, act as a new benefit coverage mandate. Because the genes relevant to pharmacogenomic testing do not change over time, testing would only need to be completed once and the results would be accessible within a patient’s medical records.
4. Medical effectiveness. CHBRP’s review of evidence on the effectiveness and clinical utility of pharmacogenomic testing found that it varies significantly across conditions. The majority of literature on the clinical effectiveness and utility of pharmacogenomic testing is condition specific and spans across a wide variety of medical conditions, most notably for cancer and chemotherapy treatments, where pharmacogenomics testing shows particular promise in avoiding adverse reactions to chemotherapy treatment. Other common conditions for which there is literature on pharmacogenomic testing include depression and other psychiatric conditions and cardiovascular disease. Recent clinical trials have shown clinical efficacy for patients with depression in particular. The results on cardiovascular disease have been more mixed with more positive results for testing on a particular drug gene pair as compared to more comprehensive panel testing.

CHBRP found that in a recent analysis of the studies that compared medication changes, a 32% increase in medication changes for patients who had received pharmacogenomic testing was found. A review on hospital admissions found that 11.5% of the patients with pharmacogenomic testing had an unplanned hospital admission as compared to 20.1% of patients who did not have the testing. Another recent study found about 30% of pharmacogenomic testing resulting in recommended changes to optimize therapy. The most common recommendations were to monitor for possible adverse drug reaction or to consider discontinuation of the medication. It is worth noting that while the studies presented show that pharmacogenomic testing may result in recommendations and changes to medication for some patients, especially to prevent adverse reactions, most patients who receive pharmacogenomic testing remain on their previously prescribed medication regimen.

1. Public health. Due to a small projected increase in utilization, as well as indeterminate offsets due to other healthcare utilization, CHBRP projects no measurable public health impact at the population level. However, there may be impacts for individuals who receive pharmacogenomics testing with reduced utilization of other health care services such as emergency room visits, unplanned hospital admissions, and outpatient visits. CHBRP did find literature identifying disparities in pharmacogenomic testing by race and ethnicity, socio-economic status, health literacy, and geographic location. Despite an increase in genetic testing in the U.S., non-Hispanic whites have had the most access to such testing, as well as people receiving care at academic medical centers rather than community sites. Again, given the small projected increase in utilization, this bill is not expected to measurably decrease these disparities.

Related/Prior Legislation

SB 1191 (Bates of 2022) also would have added pharmacogenomic testing as a Medi-Cal covered benefit. SB 1191 was vetoed by Governor Newsom who stated, “I appreciate the author's interest in facilitating access to pharmacogenomic testing, which is currently available in Medi-Cal with prior approval when medically necessary. I have worked with the Legislature to add covered benefits such as continuous glucose monitoring, community health workers, and doula services to the Medi-Cal program through the annual budget process. Although this bill is contingent upon an appropriation, it creates tens of millions of dollars in General Fund cost pressures not accounted for in the budget.”

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee, this bill would have unknown, ongoing costs in the Medi-Cal program, likely tens of millions (General Fund and federal funds), due to increased utilization of pharmacogenomic testing.

SUPPORT: (Verified 8/21/23)

Invitae Corporation (source)

Biocom California
California Clinical Laboratories Association

California Life Sciences
California Senior Legislature
California Society of Health System Pharmacists

Color Health, Inc.
Depression and Bipolar Support Alliance California

Helix Op Co, LLC.

Illumina, Inc.

Lab Genomics, LLC.

Northern California Genetic Counselors

Southern California Genetic Counselors

Syngap Research Fund

OPPOSITION: (Verified 8/21/23)

None received

ARGUMENTS IN SUPPORT: Sponsor Invitae, a medical genetics company, writes that there are many studies demonstrating the powerful ability for pharmacogenomic-directed medication management to reduce healthcare costs and improve patient outcomes. One study confirmed that pharmacogenomic testing and pharmacist-guided medication management reduced emergency department visits by 42% and hospitalizations by 52%, saving over $4,300 per patient. Supporters California Life Sciences writes that pharmacogenomic testing allows healthcare providers to precisely tailor therapeutic treatments to patients based on which drugs, biologics, or other medicines are most likely to successfully treat them with the fewest adverse side effects. This improves patient outcomes and saves both time and money for patients, providers, and the healthcare system at large.

ASSEMBLY FLOOR: 80-0, 5/31/23

AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Cervantes, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Rendon

Prepared by: Jen Flory / HEALTH / (916) 651-4111

9/2/23 9:57:18

**** END ****

SENATE COMMITTEE ON

Senator Anthony Portantino, Chair

2023 - 2024 Regular Session

AB 425 (Alvarez) - Medi-Cal: pharmacogenomic testing

Bill Summary:

AB 425 would add pharmacogenomic testing, as defined, as a benefit in the Medi-Cal program.

*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********

The following information is revised to reflect amendments

adopted by the committee on September 1, 2023

Fiscal Impact:

Unknown, ongoing costs in the Medi-Cal program, likely tens of millions (General Fund and federal funds), due to increased utilization of pharmacogenomic testing.

Author Amendments:

Author amendments add co-authors; specify an implementation date of July 1, 2024; revise the definition of pharmacogenomics testing; condition implementation on federal approvals and federal financial participation; and provide the Department of Health Care Services with specified authority to implement the provisions.

-- END --

SENATE COMMITTEE ON APPROPRIATIONS

Senator Anthony Portantino, Chair

2023 - 2024 Regular Session

AB 425 (Alvarez) - Medi-Cal: pharmacogenomic testing

Bill Summary:

AB 425 would add pharmacogenomic testing, as defined, as a benefit in the Medi-Cal program.

Fiscal Impact:

Unknown, ongoing costs in the Medi-Cal program, likely tens of millions (General Fund and federal funds), due to increased utilization of pharmacogenomic testing.

Background:

According to the Centers of Disease Control and Prevention (CDC), pharmacogenomics is an important example of the field of precision medicine, which aims to tailor medical treatment to each person or to a group of people. According to the National Human Genome Research Institute under the federal National Institutes of Health, pharmacogenomics uses information about a person's genetic makeup, or genome, to choose the drugs and drug doses that are likely to work best for that particular person. This field combines the science of how drugs work, called pharmacology, with the science of the human genome, called genomics.

The Medi-Cal program, administered by the Department of Health Care Services (DHCS), provides health coverage to eligible low-income individuals. Current law establishes a schedule of benefits under the Medi-Cal program, which includes benefits required under federal law and benefits provided at state option but for which federal financial participation through Medicaid is available. The schedule of benefits includes Rapid Whole Genome Sequencing for any Medi-Cal beneficiary who is one year of age or younger and is receiving inpatient hospital services in an intensive care unit and prescription drugs.

Proposed Law:

AB 425 would add pharmacogenomic testing, as defined, to the Medi-Cal schedule of benefits, subject to utilization controls.

Related Legislation:

SB 1191 (Bates, 2022) was similar to this bill. The bill was vetoed by the Governor.

Staff Comments:

The Department of Finance (DOF) analysis of SB 1191, which cited the California Health Benefits Review Program (CHBRP) analysis of SB 1191, estimated the costs to be between $17.6 million ($8.8 million General Fund and $8.8 million federal funds) and $54.2 million ($27.1 million General Fund and $27.1 million federal funds) annually.

-- END --

SENATE COMMITTEE ON HEALTH

Senator Dr. Susan Talamantes Eggman, Chair

BILL NO: AB 425

SUBJECT: Medi-Cal: pharmacogenomic testing

SUMMARY:

Adds pharmacogenomic testing, as defined, as a benefit in the Medi-Cal schedule of benefits.

Existing law:

1. Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), under which low-income individuals are eligible for medical coverage. [WIC §14000, et seq.]
2. Establishes a schedule of benefits under the Medi-Cal program, which includes benefits required under federal law and benefits provided at state option but for which federal financial participation through Medicaid is available. The schedule of benefits includes and Rapid Whole Genome Sequencing for any Medi-Cal beneficiary who is one year of age or younger and is receiving inpatient hospital services in an intensive care unit and prescription drugs. [WIC §14132]

This bill:

1. Adds pharmacogenomic testing to the Medi-Cal schedule of benefits, subject to utilization controls. Defines “pharmacogenomic testing” as laboratory genetic testing that includes, but is not limited to, a panel test to identify how a person’s genetics may impact the efficacy, toxicity, and safety of medications, including medications prescribed for behavioral or mental health, oncology, hematology, pain management, infectious disease, urology, reproductive or sexual health, neurology, gastroenterology, or cardiovascular diseases.
2. States that it is the intent of the Legislature to benefit the total health, including mental and physical health, of Medi-Cal beneficiaries by using available, evidence-based technologies to assess how an individual’s genetics impact their metabolism of a variety of medications and to curb the opioid crisis in California, which is exacerbated by genetic changes in individuals that create unintended “high” feelings or no pain relief, prompting increases in opioid dependency. States that through Medi-Cal coverage of pharmacogenomic testing, the safety and efficacy of medications will improve and lead to progress in health equity as well as reduction of adverse drug events, opioid dependency, emergency department visits, and hospital admissions.

FISCAL EFFECT:

According to the Assembly Appropriations Committee:

The California Health Benefits Review Program (CHBRP) analysis of a similar bill last year notes that all Medi-Cal beneficiaries have coverage for pharmacogenomic testing that is supported by medical and scientific evidence and is determined medically necessary. CHBRP estimated clarification of existing Medi-Cal coverage policies would lead to an increase in utilization of some pharmacogenomic testing, which would result in an additional 51,900 beneficiaries receiving pharmacogenomic testing if this bill passes -- a 200% increase from the 25,900 beneficiaries who currently receive pharmacogenomic testing. CHBRP estimates costs between $17.6 million and $54.2 million (General Fund and federal funds; likely at least 50% federal), with the possibility of offsetting cost reductions, to the extent use of costlier health services, such as emergency department visits and hospitalizations, are avoided.

CHBRP ran three scenarios based on whether this bill 1) changes utilization only, 2) changes utilization and consolidates billing practices due to multiple single gene tests being billed as a singular panel test, or 3) changes utilization and inflates billing practice due to multiple single gene tests being billed as multiple panel tests. In each scenario modeled, the increase in utilization was the same. However, the billing practices increased cost from $21.7 million in the first scenario, to $17.6 million in the second scenario, to $54.2 million in the last scenario.

CHBRP pointed to several studies that found pharmacogenomic testing could lead to significant cost offsets, including a reduction in emergency room utilization, unplanned hospital admissions, and outpatient visits. The sponsor of this bill, Invitae Corporation, estimates costs of $65 million per year to implement this bill, but also asserts net savings would be $59 million in the first year of implementation and $112 million per year thereafter.

PRIOR VOTES:

COMMENTS:

1. Author’s statement. According to the author, this bill was introduced because a high school student in his District came and shared her story. She had suffered from depression for years, cycling through medications, none of which worked to resolve her symptoms, until finally, she learned of pharmacogenomic testing through a Facebook support group. She thankfully had access to the test and was able to use the results to identify the most effective mental health medication for her. Once she was on the right medication, her symptoms dramatically improved. She recently asserted that pharmacogenomic testing “saved her life” and is now an advocate for ensuring access to the test. This bill would create pharmacogenomic testing access for patients in our Medi-Cal Program. Medi-Cal coverage of pharmacogenomic testing can improve clinical outcomes for many individuals who are going through mental health and physical health problems.
2. CHBRP analysis. AB 1996 (Thomson, Chapter 795, Statutes of 2002) requests the University of California to assess legislation proposing a mandated benefit or service and prepare a written analysis with relevant data on the medical, economic, and public health impacts of proposed health plan and health insurance benefit mandate legislation. CHBRP was created in response to AB 1996, and reviewed a similar bill last year, SB 1191 (Bates). Key findings include:
3. Benefit coverage. Based on queries of the Medi-Cal managed care plans, CHBRP found that broadly speaking, all Medi-Cal beneficiaries have coverage for biomarker testing, including pharmacogenomics testing, that is supported by medical and scientific evidence and is determined medically necessary. Pharmacogenomics testing can be performed before a beneficiary begins taking a medication with a companion diagnostic indication (as listed by the FDA), concurrently when a beneficiary is taking a medication with a significant biomarker reference in the FDA drug label, as a panel, or pre-emptively. However, pharmacogenomics testing is not as commonly performed pre-emptively as compared to the other reasons for testing. Because this bill would create clarity of existing benefit coverage, CHBRP concludes that it would, in essence, act as a new benefit coverage mandate. Because the genes relevant to pharmacogenomic testing do not change over time, testing would only need to be completed once and the results would be accessible within a patient’s medical records.
4. Medical effectiveness. CHBRP’s review of evidence on the effectiveness and clinical utility of pharmacogenomic testing found that it varies significantly across conditions. The majority of literature on the clinical effectiveness and utility of pharmacogenomic testing is condition specific and spans across a wide variety of medical conditions, most notably for cancer and chemotherapy treatments, where pharmacogenomics testing shows particular promise in avoiding adverse reactions to chemotherapy treatment. Other common conditions for which there is literature on pharmacogenomic testing include depression and other psychiatric conditions and cardiovascular disease. Recent clinical trials have shown clinical efficacy for patients with depression in particular. The results on cardiovascular disease have been more mixed with more positive results for testing on a particular drug gene pair as compared to more comprehensive panel testing.

CHBRP found that in a recent analysis of the studies that compared medication changes, a 32% increase in medication changes for patients who had received pharmacogenomic testing was found. A review on hospital admissions found that 11.5% of the patients with pharmacogenomic testing had an unplanned hospital admission as compared to 20.1% of patients who did not have the testing. Another recent study found about 30% of pharmacogenomic testing resulting in recommended changes to optimize therapy. The most common recommendations were to monitor for possible adverse drug reaction or to consider discontinuation of the medication. It is worth noting that while the studies presented show that pharmacogenomic testing may result in recommendations and changes to medication for some patients, especially to prevent adverse reactions, most patients who receive pharmacogenomic testing remain on their previously prescribed medication regimen.

1. Public health. Due to a small projected increase in utilization, as well as indeterminate offsets due to other healthcare utilization, CHBRP projects no measurable public health impact at the population level. However, there may be impacts for individuals who receive pharmacogenomics testing with reduced utilization of other health care services such as emergency room visits, unplanned hospital admissions, and outpatient visits. CHBRP did find literature identifying disparities in pharmacogenomic testing by race and ethnicity, socio-economic status, health literacy, and geographic location. Despite an increase in genetic testing in the U.S., non-Hispanic whites have had the most access to such testing, as well as people receiving care at academic medical centers rather than community sites. Again, given the small projected increase in utilization, this bill is not expected to measurably decrease these disparities.
2. Related legislation. SB 496 (Limón) requires a health plan contract or a health insurance policy that is issued, amended, delivered, or renewed on or after July 1, 2024, and Medi-Cal, to cover medically necessary biomarker testing for the purposes of diagnosis, treatment, appropriate management, or ongoing monitoring of an enrollee’s or insured’s disease or condition to guide treatment decisions only if the test is supported by medical and scientific evidence, as specified. SB 496 is set to be heard in the Assembly Health Committee on July 11, 2023.
3. Prior legislation. SB 912 (Limón of 2022) was substantially similar to SB 496. SB 912 was vetoed by Governor Newsom who stated, “While I appreciate the author's efforts to provide biomarker testing coverage, these services are already covered by Medi-Cal. Furthermore, biomarker testing is valuable when it can inform a condition's diagnosis and treatment, but this bill would require Medi-Cal to cover unnecessary testing that may not inform the best treatment to care for the beneficiary. . .This bill would establish broad and contradictory coverage requirements that go beyond DHCS’s evidence-based policies, which would unnecessarily increase costs without increasing the quality of coverage. I believe the DHCS should retain its current flexibility to establish evidence-based policies in light of the dynamic and changing nature of medicine.”

SB 1191 (Bates of 2022) also would have added pharmacogenomic testing as a Medi-Cal covered benefit. SB 1191 was vetoed by Governor Newsom who stated, “I appreciate the author's interest in facilitating access to pharmacogenomic testing, which is currently available in Medi-Cal with prior approval when medically necessary. I have worked with the Legislature to add covered benefits such as continuous glucose monitoring, community health workers, and doula services to the Medi-Cal program through the annual budget process. Although this bill is contingent upon an appropriation, it creates tens of millions of dollars in General Fund cost pressures not accounted for in the budget.”

AB 133 (Committee on Budget, Chapter 143, Statutes of 2021) expanded the Medi-Cal schedule of benefits to include rapid Whole Genome Sequencing for any Medi-Cal beneficiary who is one year of age or younger and is receiving inpatient hospital services in an intensive care unit.

AB 114 (Maienschein of 2021) requires rapid Whole Genome Sequencing, including individual sequencing, trio sequencing for a parent or parents and their baby, and ultra-rapid sequencing, to be a covered benefit for any Medi-Cal beneficiary who is one year old or younger and is receiving inpatient hospital services in an intensive care unit. The contents of AB 114 were included in AB 133.

SB 840 (Mitchell, Chapter 29, Statutes of 2018) appropriated $2 million for the rapid Whole Genome Sequencing Pilot Project, known as Project Baby Bear. It required DHCS to provide a grant to a state nonprofit organization for a one-time pilot project to investigate the potential clinical and programmatic value of utilizing rapid Whole Genome Sequencing in the Medi-Cal program.

1. Support. Sponsor Invitae, a medical genetics company, writes that there are many studies demonstrating the powerful ability for pharmacogenomic-directed medication management to reduce healthcare costs and improve patient outcomes. One study confirmed that pharmacogenomic testing and pharmacist-guided medication management reduced emergency department visits by 42% and hospitalizations by 52%, saving over $4,300 per patient. Supporters California Life Sciences writes that pharmacogenomic testing allows healthcare providers to precisely tailor therapeutic treatments to patients based on which drugs, biologics, or other medicines are most likely to successfully treat them with the fewest adverse side effects. This improves patient outcomes and saves both time and money for patients, providers, and the healthcare system at large.

SUPPORT AND OPPOSITION:

Support: Invitae Corporation (sponsor)

Biocom California
California Clinical Laboratories Association

California Life Sciences
California Senior Legislature
California Society of Health System Pharmacists (CSHP)
Depression and Bipolar Support Alliance (DBSA) California

Helix

Illumina, Inc.

Lab Genomics, LLC.

Northern California Genetic Counselors

Southern California Genetic Counselors

Syngap Research Fund

Oppose: None received.

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 425

Author:(Alvarez)

As Amended Ver:March 30, 2023

Majority vote

SUMMARY

Specifies that pharmacogenomic testing, as defined, is a covered benefit under Medi-Cal, subject to utilization controls.

Major Provisions

COMMENTS

1. Pharmacogenomics. According to the Centers of Disease Control and Prevention (CDC), pharmacogenomics is an important example of the field of precision medicine, which aims to tailor medical treatment to each person or to a group of people. According to the National Human Genome Research Institute (Institute) under the federal National Institutes of Health, pharmacogenomics uses information about a person's genetic makeup, or genome, to choose the drugs and drug doses that are likely to work best for that particular person. This field combines the science of how drugs work, called pharmacology, with the science of the human genome, called genomics.

Pharmacogenomic testing is performed using a cheek swab or blood sample, which is then sent to a laboratory for analysis. The CDC indicates doctors are starting to use pharmacogenomic information to prescribe drugs, but such tests are routine for only a few health problems, including certain cancers. For instance, someone with a particular genetic makeup may have an adverse reaction to a certain treatment. However, given the field's rapid growth, pharmacogenomics is soon expected to lead to better ways of using drugs to manage heart disease, cancer, asthma, depression and many other common diseases.

Invitae Corporation, the sponsor of this bill, points out improving coverage of pharmacogenomics is important to improve health equity, given women and people of color are more likely to experience negative outcomes and adverse drug events resulting from a medication they take. Due to historical practices that excluded women and people of color from clinical trials, Invitae notes, many of the recommended doses and medications are predicated on evidence generated by studies involving primarily non-Hispanic white men. For this reason, Invitae asserts improving coverage for pharmacogenomics testing that can help optimize medication will have a disproportionate positive impact on women and people of color.

1. California Health Benefits Review Program (CHBRP) analysis. AB 1996 (Thomson), Chapter 795, Statutes of 2002, requests the University of California to assess legislation proposing a mandated benefit or service and prepare a written analysis with relevant data on the medical, economic, and public health impacts of proposed health plan and health insurance benefit mandate legislation. CHBRP was created in response to AB 1996. CHBRP reviewed similar bill last year, SB 1191 (Bates) of 2022. Components of the SB 1191 analysis relevant to this bill include the following:
   1. Impact on Medi-Cal expenditures. Several studies that found pharmacogenomics testing could lead to significant cost offsets, including a reduction in emergency room utilization, unplanned hospital admissions, and outpatient visits, but CHBRP could not make a projection of actual savings. There is some evidence that the use of pharmacogenomic testing for specific types of diseases is cost-effective, but this varies significantly by disease, treatment, and outcomes assessed.
   2. Medical effectiveness.
      1. The use of pharmacogenomics in conjunction with a comprehensive medication management program has been shown to help identify medication appropriateness, improve adherence, and reduce adverse reactions in a more comprehensive way than either of these approaches can alone. More than 90% of patients are thought to carry at least one genetic variant that should prompt a change in dosing or medication if certain medications are prescribed.
      2. Evidence on the effectiveness and clinical utility of pharmacogenomic testing varies significantly across conditions. Some studies have found that pharmacogenomic testing leads to changes in medications and a reduction in hospital admissions. While the studies identified by CHBRP show that pharmacogenomic testing may result in changes to medication for some patients, especially to prevent adverse reactions, most patients who receive pharmacogenomic testing remain on their previously prescribed medication regimen

CHBRP also notes systematic reviews of the efficacy of pharmacogenomics testing have described the weakness of relevant literature as having insufficient sensitivity analyses, heterogeneity in study designs and populations, and low quality of data and methodologies.

1. Current Medi-Cal Coverage. According to the CHBRP analysis of SB 1191, all Medi-Cal beneficiaries have coverage for biomarker testing, including pharmacogenomics testing, that is supported by medical and scientific evidence and is determined medically necessary. However, Medi-Cal coverage of pharmacogenomic testing is not clearly specified. Based on a search of the Medi-Cal provider manual, the only reference to pharmacogenomic testing is CPT code 81418 (described as “Drug metabolism (eg, pharmacogenomics) genomic sequence analysis panel, must include testing of at least six genes, including CYP2C19, CYP2D6, and CYP2D6 duplication/deletion analysis”), which is listed in the Medi-Cal provider manual as a non-benefit. Some other genetic tests the author provided as commonly used for pharmacogenomics purposes are also not listed in the Medi-Cal provider manual, are listed as non-benefits, or are listed as covered with an approved treatment authorization request (TAR).

However, in spite of the status of some pharmacogenomics-related services codes as non-benefits, they can be covered by Medi-Cal if specified conditions are met. The Medi-Cal provider manual specifies Medi-Cal may provide reimbursement for a non-benefit with an approved TAR if medical necessity is established. This bill is intended to clarify Medi-Cal coverage for pharmacogenomic testing and clearly specify the parameters of coverage.

According to the Author

Having Medi-Cal coverage of pharmacogenomic testing can improve clinical outcomes for many individuals who are going through mental health and physical health problems. As an example, the author indicates a high school student in the author’s district suffered from depression for years, cycling through medications, none of which worked to resolve the student’s symptoms. The student finally learned of pharmacogenomic testing through a Facebook support group. The author explained the student gained access to the test and was able to use the results to identify the most effective mental health medication for the student, and the student’s symptoms dramatically improved with the right medication.

Arguments in Support

Invitae Corporation, this bill’s sponsor, indicates several commercial insurances cover pharmacogenomic testing for their beneficiaries, and this bill will mitigate those disparities and open up access to this potentially life-saving test. Biocom, in support, states this bill will reduce adverse drug events, improve clinical outcomes, reduce healthcare spending, and create more equitable access to better medication management.

Arguments in Opposition

There is no known opposition.

FISCAL COMMENTS

According to the Assembly Appropriations Committee:

The CHBRP analysis of this bill notes all Medi-Cal beneficiaries have coverage for pharmacogenomic testing that is supported by medical and scientific evidence and is determined medically necessary. CHBRP estimated clarification of existing Medi-Cal coverage policies would lead to an increase in utilization of some pharmacogenomic testing, which would result in an additional 51,900 beneficiaries receiving pharmacogenomic testing if this bill passes -- a 200% increase from the 25,900 beneficiaries who currently receive pharmacogenomic testing. CHBRP estimates costs between $17.6 million and $54.2 million (General Fund and federal funds; likely at least 50% federal), with the possibility of offsetting cost reductions, to the extent use of costlier health services, such as emergency department visits and hospitalizations, are avoided.

CHBRP ran three scenarios based on whether this bill 1) changes utilization only; 2) changes utilization and consolidates billing practices due to multiple single gene tests being billed as a singular panel test; or, 3) changes utilization and inflates billing practice due to multiple single gene tests being billed as multiple panel tests. In each scenario modeled, the increase in utilization was the same. However, the billing practices increased cost from $21.7 million in the first scenario, to $17.6 million in the second scenario, to $54.2 million in the last scenario.

CHBRP pointed to several studies that found pharmacogenomic testing could lead to significant cost offsets, including a reduction in emergency room utilization, unplanned hospital admissions, and outpatient visits. The sponsor of this bill, Invitae Corporation, estimates costs of $65 million per year to implement this bill, but also asserts net savings would be $59 million in the first year of implementation and $112 million per year thereafter.

VOTES

ASM HEALTH: 14-0-1

YES: Wood, Waldron, Aguiar-Curry, Arambula, Boerner Horvath, Flora, Vince Fong, Maienschein, McCarty, Joe Patterson, Rodriguez, Santiago, Villapudua, Weber

ABS, ABST OR NV: Wendy Carrillo

ASM APPROPRIATIONS: 15-0-1

YES: Holden, Megan Dahle, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Hart, Lowenthal, Mathis, Papan, Pellerin, Sanchez, Weber, Ortega

ABS, ABST OR NV: Robert Rivas

UPDATED

VERSION: March 30, 2023

CONSULTANT: Lisa Murawski / HEALTH / (916) 319-2097 FN: 0000699

Date of Hearing: April 19, 2023

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Chris Holden, Chair

ABPCA Bill Id:AB 425

Author:(Alvarez) – As Amended Ver:March 30, 2023

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill specifies that pharmacogenomic (PGx) testing is a covered benefit under Medi-Cal, subject to utilization controls.

FISCAL EFFECT:

The California Health Benefits Review Program (CHBRP) analysis of this bill notes all Medi-Cal beneficiaries have coverage for PGx testing that is supported by medical and scientific evidence and is determined medically necessary. CHBRP estimated clarification of existing Medi-Cal coverage policies would lead to an increase in utilization of some PGx testing, which would result in an additional 51,900 beneficiaries receiving PGx testing if this bill passes -- a 200% increase from the 25,900 beneficiaries who currently receive PGx testing. CHBRP estimates costs between $17.6 million and $54.2 million (General Fund and federal funds; likely at least 50% federal), with the possibility of offsetting cost reductions, to the extent use of costlier health services, such as emergency department visits and hospitalizations, are avoided.

CHBRP ran three scenarios based on whether this bill 1) changes utilization only, 2) changes utilization and consolidates billing practices due to multiple single gene tests being billed as a singular panel test, or 3) changes utilization and inflates billing practice due to multiple single gene tests being billed as multiple panel tests. In each scenario modeled, the increase in utilization was the same. However, the billing practices increased cost from $21.7 million in the first scenario, to $17.6 million in the second scenario, to $54.2 million in the last scenario.

CHBRP pointed to several studies that found PGx testing could lead to significant cost offsets, including a reduction in emergency room utilization, unplanned hospital admissions, and outpatient visits. The sponsor of this bill, Invitae Corporation, estimates costs of $65 million per year to implement this bill, but also asserts net savings would be $59 million in the first year of implementation and $112 million per year thereafter.

COMMENTS:

1. Purpose. The author states:

AB 425 was introduced because a high school student in my District came to me and shared her story. She had suffered from depression for years — cycling through medications, none of which worked to resolve her symptoms — until finally, she learned of pharmacogenomic (PGx) testing through a Facebook support group. She thankfully had access to the test and was able to use the results to identify the most effective mental health medication for her. Once she was on the right medication, her symptoms dramatically improved. She recently asserted that PGx testing “saved her life” and is now an advocate for ensuring access to the test. I am proud to be the author of this important legislation that would create PGx testing access for patients in our Medi-Cal Program. It’s important to note that having -Cal coverage of PGx testing can improve clinical outcomes for many individuals who are going through mental health and physical health problems.

1. Background. According to the Centers of Disease Control and Prevention, PGx is an important example of precision medicine, which aims to tailor medical treatment to each person or to a group of people. PGx uses information about a person's genetic makeup, or genome, to choose the drugs and drug doses that are likely to work best for that particular person. According to CHBRP, types of PGx testing include: a) necessary PGx testing for a specific drug (known as a companion diagnostic), b) PGx testing for a specific gene-drug pair but not a required companion diagnostic, c) PGx multigene panel tests to evaluate metabolic response to a medication, and d) preemptive testing using multigene panels across genes-drugs, which can be done before a provider and patient are considering a specific medication, or before considering any medication. Because the genes relevant to PGx testing do not change over time, a patient needs to be tested only once and the results remain accessible within the patient’s medical record.
   
   CHBRP reports the use of PGx in conjunction with a comprehensive medication management program has been shown to help identify medication appropriateness, improve adherence and reduce adverse reactions in a more comprehensive way than either of these approaches can alone. More than 90% of patients are thought to carry at least one genetic variant that should prompt a change in dosing or medication if certain medications are prescribed. Multigene panels allow simultaneous testing of at least two genes, and could include more than 150 genes. PGx testing is performed using a cheek swab or blood sample, which is then sent to a laboratory for analysis.
2. Prior Legislation. SB 1191 (Bates), of the 2021-22 Legislative Session, also would have added PGx testing as a covered benefit under Medi-Cal. AB 1191was vetoed by the Governor, who stated:

I appreciate the author's interest in facilitating access to PGx testing, which is currently available in Medi-Cal with prior approval when medically necessary. Although this bill is contingent upon an appropriation, it creates tens of millions of dollars in General Fund cost pressures not accounted for in the budget.”

Analysis Prepared by: Allegra Kim / APPR. / (916) 319-2081

Date of Hearing: March 28, 2023

ASSEMBLY COMMITTEE ON HEALTH

Jim Wood, Chair

ABPCA Bill Id:AB 425

Author:(Alvarez) – As Introduced Ver:February 6, 2023

SUBJECT: Medi-Cal: pharmacogenomic testing.

SUMMARY: Adds pharmacogenomic testing as a Medi-Cal benefit and specifies several parameters related to coverage, including prohibiting prior authorization and establishing coverage for pharmacogenomic testing related to any drug known to have a gene-drug or drug-drug-gene interaction that has been demonstrated to be clinically actionable, as specified. Specifically, this bill:

1. Establishes pharmacogenomic testing as a covered Medi-Cal benefit, without prior authorization or Treatment Authorization Request (TAR).
2. Covers pharmacogenomic testing under the Medi-Cal program if a medication is being considered for use, or is already being administered, and is approved for use, in treating a Medi-Cal beneficiary’s condition and is known to have a gene-drug or drug-drug-gene interaction that has been demonstrated to be clinically actionable, as defined by the United States Food and Drug Administration or by the Clinical Pharmacogenetics Implementation Consortium (CPIC) Guidelines for Level A, A/B, or B, if the test is ordered by an enrolled Medi-Cal clinician or pharmacist.
3. Specifies Medi-Cal reimbursement for pharmacogenomic testing is subject to the use of only one Current Procedural Terminology (CPT) code, or only one Healthcare Common Procedure Coding System (HCPCS) code, for the test. Prohibits each individual gene of a panel test from being billed with multiple CPT or HCPCS codes.
4. Permits sample collection for purposes of performing pharmacogenomic testing to be completed at home, within a pharmacy, or at a health facility. Prohibits the location of sample collection from impacting Medi-Cal reimbursement for pharmacogenomic testing.
5. Allows the Department of Health Care Services (DHCS) to implement coverage for pharmacogenomics testing by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions, until the department promulgates regulations.
6. Makes the bill operative upon an appropriation by the Legislature.
7. Defines the following terms:
   
   1. “Pharmacogenomics” means the evaluation of how a person’s genes affect how the person responds to medications. Pharmacogenomics enables the selection of drugs and doses best suited to reduce toxicity and adverse drug events, including treatment failures, severe harm, or even death;
      
   2. “Pharmacogenomic testing” means laboratory genetic testing, including, but not limited to, a panel test, by a California-licensed laboratory with accreditation by the College of American Pathologists (CAP) or another accrediting agency approved by the federal Centers for Medicare and Medicaid Services (CMS) and a valid Clinical Laboratory Improvement Amendments certificate to identify how a person’s genetics may impact the efficacy, toxicity, and safety of medications; and,
   3. “Medication” means medication prescribed for any condition, including, but not limited to, behavioral or mental health, oncology, hematology, pain management, infectious disease, urology, reproductive or sexual health, neurology, gastroenterology, or cardiovascular diseases.
      

EXISTING LAW:

1. Establishes the Medi-Cal Program, administered by DHCS, to provide comprehensive health benefits to low-income individuals who meet specified eligibility criteria. [Welfare and Institutions Code (WIC) §14000 et seq.]
2. Establishes a schedule of benefits under the Medi-Cal program, including coverage of outpatient laboratory services, subject to utilization controls, and coverage of prescription drugs, subject to the Medi-Cal List of Contract Drugs and utilization controls. [WIC §14132]

FISCAL EFFECT: Unknown. This bill has not yet been analyzed by a fiscal committee.

COMMENTS:

1. PURPOSE OF THIS BILL. This bill is sponsored by Invitae Corporation to ensure equitable access to pharmacogenomic testing. According to the author, having Medi-Cal coverage of pharmacogenomic testing can improve clinical outcomes for many individuals who are going through mental health and physical health problems. As an example, the author indicates a high school student in the author’s district suffered from depression for years, cycling through medications, none of which worked to resolve the student’s symptoms. The student finally learned of pharmacogenomic testing through a Facebook support group. The author explained the student gained access to the test and was able to use the results to identify the most effective mental health medication for the student, and the student’s symptoms dramatically improved with the right medication. The author indicates other states have passed bills that mandate Medicaid coverage for pharmacogenomic testing. The author asserts although California is usually a leader in providing access to evidence-based medicine, our Medi-Cal program has fallen behind, which presents health equity issues given commercial and Medicare patients can access the test.
   
2. BACKGROUND.
   1. Pharmacogenomics. According to the Centers of Disease Control and Prevention (CDC), pharmacogenomics is an important example of the field of precision medicine, which aims to tailor medical treatment to each person or to a group of people. According to the National Human Genome Research Institute (Institute) under the federal National Institutes of Health, pharmacogenomics uses information about a person's genetic makeup, or genome, to choose the drugs and drug doses that are likely to work best for that particular person. This field combines the science of how drugs work, called pharmacology, with the science of the human genome, called genomics.
      
      The Institute indicates pharmacogenomics may help to quickly identify the best drugs to treat people with certain mental health disorders. For example, while some patients with depression respond to the first drug they are given, many do not, and doctors have to try another drug. Because each drug takes weeks to take its full effect, patients' depression may grow worse during the time spent searching for a drug that helps. The Institute explains, recently, researchers identified genetic variations that influence the response of depressed people to citalopram (Celexa), which belongs to a widely used class of antidepressant drugs called selective serotonin re-uptake inhibitors (SSRIs). Clinical trials are now underway to learn whether genetic tests that predict SSRI response can improve patients' outcomes.
      
      Pharmacogenomic testing is performed using a cheek swab or blood sample, which is then sent to a laboratory for analysis. The CDC indicates doctors are starting to use pharmacogenomic information to prescribe drugs, but such tests are routine for only a few health problems, including certain cancers. For instance, someone with a particular genetic makeup may have an adverse reaction to a certain treatment. However, given the field's rapid growth, pharmacogenomics is soon expected to lead to better ways of using drugs to manage heart disease, cancer, asthma, depression and many other common diseases.
      
      There are two major sources of pharmacogenomic testing recommendations: The U.S. Food and Drug Administration (FDA) and the CPIC. The CPIC is an international consortium of individual volunteers and a small staff interested in facilitating use of pharmacogenetic tests for patient care. CPIC creates, curates, and posts evidence-based gene/drug clinical practice guidelines. FDA lists therapeutic products with pharmacogenomic information found in the drug labeling. FDA notes labeling for some, but not all, of the products includes specific actions to be taken based on the pharmacogenomic information.
      
      Invitae Corporation, the sponsor of this bill, points out improving coverage of pharmacogenomics is important to improve health equity, given women and people of color are more likely to experience negative outcomes and adverse drug events resulting from a medication they take. Due to historical practices that excluded women and people of color from clinical trials, Invitae notes, many of the recommended doses and medications are predicated on evidence generated by studies involving primarily non-Hispanic white men. For this reason, Invitae asserts improving coverage for pharmacogenomics testing that can help optimize medication will have a disproportionate positive impact on women and people of color.
   2. California Health Benefits Review Program (CHBRP) analysis. AB 1996 (Thomson), Chapter 795, Statutes of 2002, requests the University of California to assess legislation proposing a mandated benefit or service and prepare a written analysis with relevant data on the medical, economic, and public health impacts of proposed health plan and health insurance benefit mandate legislation. CHBRP was created in response to AB 1996. CHBRP reviewed similar bill last year, SB 1191 (Bates) of 2022. Components of the SB 1191 analysis relevant to this bill include the following:
      1. Impact on Medi-Cal expenditures. Several studies that found pharmacogenomics testing could lead to significant cost offsets, including a reduction in emergency room utilization, unplanned hospital admissions, and outpatient visits, but CHBRP could not make a projection of actual savings. There is some evidence that the use of pharmacogenomic testing for specific types of diseases is cost-effective, but this varies significantly by disease, treatment, and outcomes assessed.
         
      2. Medical effectiveness.
         1. The use of pharmacogenomics in conjunction with a comprehensive medication management program has been shown to help identify medication appropriateness, improve adherence, and reduce adverse reactions in a more comprehensive way than either of these approaches can alone. More than 90% of patients are thought to carry at least one genetic variant that should prompt a change in dosing or medication if certain medications are prescribed.
         2. Evidence on the effectiveness and clinical utility of pharmacogenomic testing varies significantly across conditions. Some studies have found that pharmacogenomic testing leads to changes in medications and a reduction in hospital admissions. While the studies identified by CHBRP show that pharmacogenomic testing may result in changes to medication for some patients, especially to prevent adverse reactions, most patients who receive pharmacogenomic testing remain on their previously prescribed medication regimen
            

CHBRP also notes systematic reviews of the efficacy of pharmacogenomics testing have described the weakness of relevant literature as having insufficient sensitivity analyses, heterogeneity in study designs and populations, and low quality of data and methodologies.

• 1. Current Medi-Cal Coverage. According to the CHBRP analysis of SB 1191, all Medi-Cal beneficiaries have coverage for biomarker testing, including pharmacogenomics testing, that is supported by medical and scientific evidence and is determined medically necessary. However, Medi-Cal coverage of pharmacogenomic testing is not clearly specified. Based on a search of the Medi-Cal provider manual, the only reference to pharmacogenomic testing is CPT code 81418 (described as “Drug metabolism (eg, pharmacogenomics) genomic sequence analysis panel, must include testing of at least six genes, including CYP2C19, CYP2D6, and CYP2D6 duplication/deletion analysis”), which is listed in the Medi-Cal provider manual as a non-benefit. Some other genetic tests the author provided as commonly used for pharmacogenomics purposes are also not listed in the Medi-Cal provider manual, are listed as non-benefits, or are listed as covered with an approved TAR.
     
     However, in spite of the status of some pharmacogenomics-related services codes as non-benefits, they can be covered by Medi-Cal if specified conditions are met. The Medi-Cal provider manual specifies Medi-Cal may provide reimbursement for a non-benefit with an approved TAR if medical necessity is established. This bill is intended to clarify Medi-Cal coverage for pharmacogenomic testing and clearly specify the parameters of coverage.

1. SUPPORT. Invitae Corporation, this bill’s sponsor, indicates several commercial insurances cover pharmacogenomic testing for their beneficiaries, and this bill will mitigate those disparities and open up access to this potentially life-saving test. Biocom, in support, states this bill will reduce adverse drug events, improve clinical outcomes, reduce healthcare spending, and create more equitable access to better medication management.
   
2. RELATED LEGISLATION. AB 365 (Aguiar-Curry) specifies continuous glucose monitors and related supplies required for use with those monitors are covered benefits for the treatment of diabetes under Medi-Cal. AB 365 is pending in the Assembly Appropriations Committee.
3. PREVIOUS LEGISLATION. SB 1191 was similar to this bill and would have added pharmacogenomic testing as a covered benefit under Medi-Cal, requiring the Medi-Cal program to cover pharmacogenomic testing if a medication is being considered for use, or is already being administered, and is approved for use, in treating a Medi-Cal beneficiary’s condition and is known to have a gene-drug or drug-drug-gene interaction that has been demonstrated to be clinically actionable, if the medication is ordered by an enrolled Medi-Cal clinician or pharmacist. AB 1191was vetoed by the Governor, who stated, “I appreciate the author's interest in facilitating access to PGx testing, which is currently available in Medi-Cal with prior approval when medically necessary. Although this bill is contingent upon an appropriation, it creates tens of millions of dollars in General Fund cost pressures not accounted for in the budget.”
4. AMENDMENTS. In consultation with the author, the Committee proposes the following amendments:
   1. To address concerns about excessive specificity of the parameters of coverage and to maintain DHCS’s authority to establish appropriate utilization controls, amendments strike the bill’s proposed stand-alone section of law and instead simply specify pharmacogenomics is a covered benefit, subject to utilization controls, in WIC §14132, the section of current law that establishes the Medi-Cal schedule of benefits. This amendment removes the specific parameters of coverage, including the prohibition on TARs, the requirement to cover any pharmacogenomics tests with known genetic interactions by reference to specific clinical guidelines, the prohibition on use of more than one CPT or HCPCS codes, and parameters specifying allowable locations of sample collection.
   2. Conform legislative findings and declarations to changes described in a) above. Amendments would address the veto message to SB 1191, a similar bill, by aligning with the Governor’s statement that pharmacogenomics testing is currently available in Medi-Cal with prior approval when medically necessary. Amendments would specify pharmacogenomics testing is a covered benefit, similar to how other Medi-Cal benefits are specified in the statute, subject to utilization controls. As such, DHCS would retain authority to cover testing pursuant to a TAR if such controls are deemed appropriate.

REGISTERED SUPPORT / OPPOSITION:

Support

Invitae Corporation (sponsor)

Biocom California

California Life Sciences

California Senior Legislature

DBSA California

Illumina, INC.

Opposition

None on file.

Analysis Prepared by: Lisa Murawski / HEALTH / (916) 319-2097