PITTSBURGH—The House of Representatives Insurance Committee for the state of Pennsylvania held a public hearing here earlier this week to look into issues surrounding  House Bill 2101, which if passed, could have far reaching implications for managed vision plans around the country which mandate which ophthalmic labs providers must use.

The bill, sponsored by Rep. Harry Readshaw (D—PA) and described to VMail by the congressman as a “free-standing” bill, would amend the 1974 Unfair Insurance Practices Act. According to the language of the bill, the existing Act would add a new paragraph that would read “Unfair Methods of Competition and Unfair or Deceptive Acts or Practices Defined in the business of insurance means: requiring an insured to obtain ophthalmic services and products from a vision laboratory or company as a condition of obtaining the payment for the vision services.”

A range of representatives from the vision care field testified at the April 28 hearing, including, laboratories, independent eyecare professionals, some frame manufacturers and executives from both Plainview, N.Y.-based Davis Vision and Pittsburgh-based Highmark, Inc., Davis’ parent and a dominant player in the Pennsylvania market.

The bill targets the ability of managed vision plans to mandate ophthalmic laboratories for providers. According to a statement from Readshaw, “Some insurers require that individuals must obtain their corrective lenses and frames from certain corporate eyeglass companies that also provide examination and prescriptions, thus putting ECPs at a disadvantage because they do not have labs to make the corrective lenses.”

Day-long testimony included presentations from Rep. Readshaw as well as a range of independent ODs, opticians and other parties including Joseph Wende, OD, senior VP professional affairs, quality management for Davis Vision; Michael Warfel, VP government affairs for Highmark; Robert McCauley, OD, president of Western Optometric Society; Steve Seibert, Three Rivers Optical; Pittsburgh-area opticians James Michael Jones, Linda Boss and Stacie Warneke; Wes Smith, WC Eyewear and William Segen.

Following opening remarks by Readshaw, Davis Vision’s Wende’s statement read, “By requiring significant changes in vision benefits available to Pennsylvanians, we believe the proposed legislation, House Bill 2101, could cost a typical family hundreds of dollars in additional expenses each year.” He went on to cite several provisions in the bill that would “result in higher out-of-pocket costs to the consumer and higher premium costs to employers and other plan sponsors. We believe this legislation would not benefit the consumer.”

Steve Seibert, owner of Three Rivers Optical spoke on behalf of independent optical labs in the Pittsburgh area as well as the state. He said, “We have seen significant impact in the optical laboratory business since one of the big insurance companies took over Opti-Choice, Security Blue and all the welfare programs in Pennsylvania. As a result of this action, four labs have closed.” He went on to say that most independent labs’ revenues and units are down 28 percent to 36 percent, “due to the closed network that the above mentioned insurance company has forced on the industry.”

After the hearing, Joe Kasyan, owner of Donaldson Optical told VMail he believed the hearings were a positive sign for independent lab owners. “When the hearing first started, I think the senators and representatives had a different outlook. They didn’t realize how much the doctors and labs were affected by some of these managed vision care policies.”

In an interview after the hearing with VMail, Rep. Readshaw said, “The testimony given by the labs, opticians and manufacturers was most compelling. They made valid points and educated the committee about the necessity for a level playing field. I think they made it clear that they are not afraid of competition. In fact, they need it in order to offer more choices to the consumer.”

In response to queries from VMail, a Highmark spokesperson said, “We believe this bill is flawed and not in the best interest of consumers and employers. We will use every opportunity to explain to Pennsylvania legislators why we feel this way—beginning with the testimony delivered by Dr. Wende in Pittsburgh on April 28.

“We will respond to additional inquiries from the Pa. House Insurance Committee, as requested. At this time, however we are awaiting a copy of the transcript from the public hearing to see if we'll have the need to respond to any inaccurate information it may contain about Davis Vision, other vision plans or our industry that were referenced or discussed. We were the first to testify on April 28 and were not able to react/respond to the testimony from others that followed,” he noted.

In addition, the spokesperson said, “While next steps are up to the committee and not us or other vision plans, specific inquiries about the bill may be directed to Chairman DeLuca's office [head of the Insurance Committee].”

According to Rep. Readshaw, additional hearings in other parts of the state, may be requested by the Insurance Committee, after which bill 2101 would be sent to the House Committee and if voted on, would then be sent to the State Senate. He described the bill’s journey as “a long process and if we are lucky, all of this might be completed by the end of the year.”