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Statement Regarding Department of Insurance Order

By Paul Markovich, Chief Operating Officer, Blue Shield of California

Name: Steve Shivinsky

Title: Corporate Communications

Phone: 415-229-5447

Email: steve.shivinsky@blueshieldca.com

Blue Shield will not put our members in the middle of this dispute with the regulatory agencies over the interpretation of the law. We will cover Applied Behavioral Analysis (ABA) services for our members, subject to appropriate consumer protections, as we seek guidance from the courts regarding what the law requires.

We are perplexed by the Order from the Department of Insurance. This Order cites just two cases - in which we have already agreed to pay for ABA services - and represents a change from the department's long-held previous position on these issues.

Several weeks prior to the issuance of this complaint, the department was aware that Blue Shield had agreed to cover the services requested in these two cases. We also informed the department that we will cover ABA services in all such cases until the underlying legal issues are resolved in court. We signed an agreement to that effect with the Department of Managed Health Care and are prepared to do the same with the Department of Insurance.

Our insurance policies also cover a wide range of services for people diagnosed with autism when delivered by licensed medical providers, including speech therapy, physical therapy, psychiatry, psychology, diagnostic tests, pharmaceutical drugs and many other services. However, our policies also specify that services provided by unlicensed people are not covered and ABA services are frequently provided by unlicensed providers. The Department of Insurance has never objected to those policies until very recently.

Nonetheless, the department's Order demands that Blue Shield cover Applied Behavioral Analysis therapy from individuals who have no state license, who are not certified or registered health care providers, who do not carry malpractice insurance, and who are not subject to California medical privacy information laws. ABA is an intimate, sensitive service sometimes delivered in the home. If a provider is not licensed, there is no governmental authority confirming that the provider is reputable and qualified. Moreover, a California court recently ruled that the Department of Managed Health Care acted appropriately in requiring ABA providers to be licensed as a minimum qualification to protect California patients. That's why we have sought to have ABA services delivered under the supervision of a licensed medical professional, a consumer protection that was included in Blue Shield's agreement with the DMHC.


Background on Blue Shield of California

Blue Shield of California, an independent member of the Blue Cross Blue Shield Association, is a not-for-profit health plan with 3.3 million members, 4,800 employees, and one of the largest provider networks in California. Founded in 1939 and headquartered in San Francisco, Blue Shield of California offers a wide range of commercial and government products throughout the state. The company has contributed more than $125 million over the past four years to the Blue Shield of California Foundation - which was named one of BusinessWeek's top 20 most generous corporate foundations. Contact your local agent or broker for more information about Blue Shield products and services, or visit the Blue Shield web site at www.blueshieldca.com.