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entitled 'Managing Diabetes: Health Plan Coverage of Services and 
Supplies' which was released on March 28, 2005.

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Report to Congressional Requesters:

United States Government Accountability Office:

GAO:

February 2005:

Managing Diabetes:

Health Plan Coverage of Services and Supplies:

GAO-05-210:

GAO Highlights:

Highlights of GAO-05-210, a report to congressional requesters: 

Why GAO Did This Study:

Diabetes, which afflicts millions of Americans, is a manageable disease 
whose effects can be mitigated with proper care, regularly received. 
Experts recommend certain services and supplies for managing diabetes. 
Because these can be costly, concerns exist about whether individuals 
with diabetes have access to and receive what they need. Little is 
known, however, about health plan coverage of diabetes services and 
supplies.

GAO reviewed the extent to which (1) states require insurance policies 
to cover diabetes services and supplies, (2) health coverage not 
subject to state requirements includes diabetes services and supplies, 
and (3) individuals with diabetes ages 18 and older receive services 
and supplies. GAO analyzed all 50 states and the District of 
Columbias laws and regulations pertaining to diabetes coverage. GAO 
also obtained from selected health plans providing coverage not subject 
to state requirements13 large-employer plans and 3 plans in the 
Federal Employees Health Benefits Program (FEHBP)information on 
coverage of 10 services and nine supplies identified as important for 
individuals with diabetes. In addition, GAO obtained national data from 
the Centers for Disease Control and Prevention (CDC) on individuals 
receipt of diabetes services and supplies. GAO received technical 
comments from CDC and incorporated them in the report as appropriate.

What GAO Found:

In 2004, 47 states, including the District of Columbia, had laws or 
regulations related to coverage of diabetes services or supplies, 
although specific requirements varied by state. Services for which 
states most often required coverage were diabetes education (45 states) 
and medical nutrition therapy (27 states). All 47 required coverage of 
diabetes supplies, although some states were more specific than others 
about which supplies must be covered.

Health plans GAO contacted that provide coverage not subject to state 
insurance requirementsthose offered by 13 large Fortune 500 companies 
and the 3 largest health plans in FEHBPcovered most of the services 
and supplies recommended for individuals with diabetes, generally 
without limits on the coverage. Each plan covered at least 7 of 10 
diabetes services, such as an annual blood glucose test, cholesterol 
and blood pressure monitoring, and influenza vaccinations, as well as 
at least five of nine diabetes supplies, such as insulin and insulin-
administering supplies.

According to a 2003 CDC nationwide survey, the majority of individuals 
with diabetes reported receiving at least one diabetes service within 
the past 12 months. Significantly fewer individuals, however, reported 
receiving five services that individuals with diabetes are recommended 
to receive at least once a year. For example, an estimated 88 percent 
reported receiving a test for blood glucose, whereas an estimated 33 
percent had received the five recommended services: blood glucose and 
cholesterol tests, eye and foot exams, and an influenza vaccination. 
Receipt of diabetes services and supplies varied by service, state, and 
whether an individual had health coverage. For example, 71 percent of 
individuals with diabetes who had health coverage at the time of the 
survey received eye exams, compared with 46 percent of individuals with 
diabetes who lacked coverage (see figure).

Estimated Percentage of Individuals Ages 18 and Older with Diabetes, 
With and Without Health Coverage, Who Reported Receiving Diabetes 
Services, 2003: 

[See PDF for image]

[End of figure]

What GAO Recommends:

www.gao.gov/cgi-bin/getrpt?GAO-05-210.

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Kathryn G. Allen at (202) 
512-7118.

[End of section]

Contents:

Letter:

Results in Brief:

Background:

Most States Require Insurance Policies to Cover Diabetes Services and 
Supplies, Although Specific Requirements Vary:

Selected Health Plans Providing Coverage Not Subject to State 
Regulation Cover Most but Not All Diabetes Services and Supplies:

Nationwide, Receipt of Diabetes Services and Control of Related Health 
Conditions Are Uneven:

Agency Comments:

Appendix I: Scope and Methodology:

Appendix II: Summary of Diabetes Coverage Requirements in State Laws or 
Regulations, 2004:

Appendix III: GAO Contact and Staff Acknowledgments:

GAO Contact:

Acknowledgments:

Tables:

Table 1: Services for Managing Diabetes:

Table 2: Diabetes Services Covered by the Three Largest FEHBP Plans, 
2004:

Table 3: Range among States in Estimates of Diabetes Services Received 
by Individuals with Diabetes, 2003:

Table 4: Indicators of Services and Supplies for Managing Diabetes:

Figures:

Figure 1: Number of States Requiring Coverage of Diabetes Services and 
Supplies, 2004:

Figure 2: Diabetes Services Covered by 13 Large Employers' Self-Funded 
Health Plans, 2004:

Figure 3: Diabetes Supplies Covered by 13 Large Employers' Self-Funded 
Health Plans, 2004:

Figure 4: Estimated Nationwide Percentage of Individuals Ages 18 and 
Older with Diabetes Who Reported Receiving Diabetes Services, 2003:

Figure 5: Estimated Nationwide Percentage of Individuals Ages 18 and 
Older with Diabetes, With and Without Health Coverage, Who Reported 
Receiving Diabetes Services, 2003:

Abbreviations:

ADA: American Diabetes Association: 
Alliance: National Diabetes Quality Improvement Alliance: 
BRFSS: Behavioral Risk Factor Surveillance System: 
CDC: Centers for Disease Control and Prevention: 
ERISA: Employee Retirement Income Security Act of 1974: 
FEHBP: Federal Employees Health Benefits Program: 
NHANES: National Health and Nutrition Examination Survey: 
OPM: Office of Personnel Management:

United States Government Accountability Office:

Washington, DC 20548:

February 25, 2005:

The Honorable Joe Barton: 
The Honorable Fred Upton:
House of Representatives:

Diabetes afflicts an estimated 18 million Americans, and the number of 
newly diagnosed cases has been rising, according to the Centers for 
Disease Control and Prevention (CDC).[Footnote 1] Diabetes is 
characterized by a high level of blood glucose, which damages nerve 
endings and blood vessels; this damage in turn leads to serious health 
complications such as blindness, heart disease and stroke, kidney 
disease, and poor circulation in the extremities potentially resulting 
in foot or leg amputations. Complications like these can be delayed or 
prevented with proper care, provided that such care is accessible and 
used.[Footnote 2] Specifically, federal health agencies and national 
organizations recommend that individuals with diabetes receive certain 
services to manage their disease--including periodic tests for blood 
glucose,[Footnote 3] eye and foot exams, medical nutrition therapy, and 
diabetes education--along with other services, such as cholesterol 
tests, smoking cessation services, and influenza immunizations, which 
help reduce the risk of complications. Supplies that many individuals 
with diabetes use to track and control their blood glucose levels 
include blood glucose monitors; test strips; insulin; and, to 
administer insulin, insulin pumps or disposable needles and syringes.

Because diabetes services and supplies can be costly, you and others 
have raised concerns about whether individuals with diabetes have 
access to and receive all the services and supplies they need. Certain 
national organizations concerned with diabetes patient care have 
advocated state laws mandating that health insurance cover certain 
services and supplies benefiting these individuals. Although states 
generally do not regulate employment-based benefit plans, such as 
health plans provided by employers, they do regulate insurance; 
consequently, health coverage employers provide through the purchase of 
insurance is generally subject to state insurance regulation.[Footnote 
4] Although the exact number is unknown, many individuals with diabetes 
have health coverage not subject to state insurance regulation because 
their employers self-fund their health plans; that is, the employers 
pay the cost of health benefits directly, instead of purchasing 
insurance. In addition, the Federal Employees Health Benefits Program 
(FEHBP)--through which the federal Office of Personnel Management (OPM) 
contracts with private health insurance carriers to offer health 
coverage to federal employees, retirees, and their dependents[Footnote 
5]--is not subject to state insurance requirements.[Footnote 6]

In this context, we examined the following three questions:

1. To what extent do state laws or regulations require health insurance 
policies to cover diabetes services and supplies?

2. To what extent does health coverage not subject to state insurance 
requirements--specifically, coverage provided by the largest health 
plans participating in FEHBP and the largest private self-funded health 
plans--include diabetes services and supplies?

3. To what extent do individuals with diabetes, including those with 
health coverage and those without, receive diabetes services and 
supplies?

To answer these questions, we obtained information from federal health 
agencies and national organizations concerned with diabetes patient 
care, and we identified 10 services and nine supplies that individuals 
with diabetes may need.[Footnote 7] To examine the extent to which 
states require health insurance policies to cover diabetes services and 
supplies, we reviewed state laws and regulations related to diabetes 
coverage.[Footnote 8] To assess the extent to which health coverage not 
subject to state requirements--such as coverage provided by the largest 
plans participating in FEHBP and by selected large employers' self- 
funded plans--includes diabetes services and supplies, we contacted the 
three largest national plans participating in FEHBP--Blue Cross and 
Blue Shield, Mail Handlers, and Government Employees Hospital 
Association, Inc.[Footnote 9]--as well as a random sample of 15 of the 
largest 50 Fortune 500 companies regarding their plans' coverage of 
diabetes services and supplies in 2004.[Footnote 10] We received 
responses from all three FEHBP plans, which covered approximately 5.3 
million people in 2003, and from 13 of 15 of the employers we 
contacted, which together employed about 2.4 million people in 
2003.[Footnote 11] To collect information on the extent to which 
individuals with diabetes with and without health coverage receive 
diabetes services and supplies, we analyzed data provided by CDC from 
an annual national survey of individuals ages 18 and older known as the 
Behavioral Risk Factor Surveillance System (BRFSS). This survey, 
conducted by the states, consists of self-reported data gathered from 
telephone interviews.[Footnote 12] We used data collected during 2003, 
the most recent year available. We also obtained data from another CDC 
survey known as the National Health and Nutrition Examination Survey 
(NHANES). Unlike BRFSS, this survey combines an in-home interview with 
a physical examination to assess the health of a nationally 
representative sample of the noninstitutionalized U.S. population, 
including a representative sample of individuals with 
diabetes.[Footnote 13] We used data collected by this survey from 1999 
through 2002 for individuals ages 18 and older. To assess data 
reliability, we reviewed CDC documentation of its data collection and 
discussed the data and their appropriate use with CDC officials. We 
determined that the data were sufficiently reliable for our purposes.

We conducted our work according to generally accepted government 
auditing standards from July 2004 through January 2005. Additional 
details about our scope and methodology appear in appendix I.

Results in Brief:

In 2004, 47 states had laws or regulations related to coverage of 
diabetes services or supplies, although the specific coverage 
requirements varied by state. States most often required coverage of 
two diabetes services: diabetes education and medical nutrition 
therapy. Forty-five states required diabetes education, and 27 required 
medical nutrition therapy. National organizations concerned with 
diabetes patient care have worked with states to develop laws and 
regulations addressing these services in particular because other 
services, such as eye and foot exams, were thought to be covered by 
most health plans as general medical services. In addition, 47 states 
had coverage requirements related to diabetes supplies, although some 
states were more specific than others about which supplies must be 
covered.

The plans we contacted that provide coverage not subject to state 
insurance requirements--specifically, the 3 largest health plans 
participating in FEHBP and 13 of the largest employers' self-funded 
plans--covered most of the diabetes services and supplies we reviewed, 
in most cases without limits on the coverage. Each of the 3 FEHBP plans 
and the 13 self-funded plans we contacted covered at least 7 of the 10 
diabetes services, such as an annual blood glucose test, cholesterol 
and blood pressure monitoring, and influenza vaccinations. Services 
covered less often included diabetes education, medical nutrition 
therapy, and smoking cessation therapy. All 16 plans also covered at 
least five of the nine diabetes supplies we reviewed, including insulin 
and insulin-administering supplies; most of these plans also covered 
blood glucose monitors, glucose control solutions, alcohol swabs, and 
therapeutic shoes.

Data from CDC's 2003 nationwide survey showed that a majority of 
individuals with diabetes ages 18 and older reported receiving at least 
one diabetes service within the past 12 months; a much smaller 
proportion, however, reported receiving five services that experts 
recommend that individuals with diabetes receive at least once a year. 
Nationwide, an estimated 88 percent of individuals with diabetes had 
received a test for blood glucose within the past 12 months, whereas an 
estimated 33 percent had received five services: blood glucose and 
cholesterol tests, eye and foot exams, and an influenza vaccination. 
Receipt of services and supplies among individuals with diabetes varied 
by service, state, and whether an individual had health coverage. For 
example, an estimated 71 percent of individuals with diabetes who had 
health coverage at the time of the survey had received eye exams, 
compared with 46 percent of those who lacked health coverage. Other CDC 
survey data indicate that many individuals with diabetes do not have 
adequate control of diabetes-related conditions that may increase their 
risk of complications.

We provided a draft of this report to CDC for comment. The agency 
provided us with technical comments, which we incorporated into the 
report as appropriate.

Background:

Diabetes, a chronic disease, was the sixth leading cause of death in 
the United States in 2000, contributing to the loss of more than 
200,000 lives, according to CDC. Type 1 diabetes, in which the body 
fails to produce insulin, is usually diagnosed in children and young 
adults. Type 2 diabetes, in which the body fails to use insulin 
properly, is associated with aging, a family history of diabetes, 
physical inactivity, and obesity and accounts for 90 to 95 percent of 
all diabetes cases. Although type 2 diabetes occurs most often among 
adults, it is increasingly being diagnosed in children and 
adolescents.[Footnote 14] One study found that, on average in 2002, 
individuals with diabetes incurred about $13,243 in health care 
expenditures, compared with about $2,560 in expenditures for 
individuals without diabetes.[Footnote 15] These estimates include 
costs attributed to complications of diabetes, such as cardiovascular 
disease, neurological symptoms, and kidney disease.

Federal health agencies and national organizations concerned with 
diabetes patient care have identified a number of services and supplies 
that individuals with diabetes often need to help manage their disease. 
Table 1 lists services considered important for diabetes patient care 
by the American Association of Diabetes Educators; the American 
Dietetic Association; and the National Diabetes Quality Improvement 
Alliance (Alliance), a consortium of 13 private-sector organizations 
and government agencies, including the American Diabetes Association 
(ADA), CDC, and the Centers for Medicare & Medicaid Services.[Footnote 
16]

Table 1: Services for Managing Diabetes:

Service: Blood glucose (A1c) management[A]; 
Importance for patient care: Regular, frequent monitoring of glucose in 
the blood (as HbA1c, hemoglobin A1c, or glycosylated hemoglobin) 
reduces the risk of complications such as nerve damage, kidney disease, 
and vision disorders.

Service: Lipid (cholesterol) management; 
Importance for patient care: Individuals with diabetes are at increased 
risk of coronary heart disease. Lowering serum cholesterol levels can 
reduce this risk.

Service: Urine protein screening for kidney disease; 
Importance for patient care: Diabetes is the leading cause of end-stage 
renal (kidney) disease. The earliest clinical evidence of kidney 
disease is the appearance of low but abnormal levels of a protein 
(albumin) in the urine. Early detection and treatment of this condition 
may prevent or slow the progression of diabetic kidney disease.

Service: Eye exam for eye disease; 
Importance for patient care: Individuals with diabetes are at increased 
risk of blindness caused by retinopathy, or diseases of the retina, the 
light-sensitive tissue at the back of the eye that is needed for 
vision. The prevalence of retinopathy is strongly related to the 
duration of diabetes, but treatment can prevent or delay onset.

Service: Foot exam to detect problems with circulation and sensation; 
Importance for patient care: Individuals with diabetes are at increased 
risk of foot ulcers and amputations. Annual foot exams and management 
of risk factors can prevent or delay poor outcomes.

Service: Influenza immunization; 
Importance for patient care: Individuals with diabetes are considered 
to be at increased risk of complications, hospitalization, and death 
from influenza, as well as of secondary infections, such as pneumonia, 
resulting from influenza.

Service: Blood pressure management; 
Importance for patient care: Controlling blood pressure in patients 
with diabetes reduces diabetes complications, diabetes-related deaths, 
strokes, heart failure, and other complications.

Service: Diabetes education; 
Importance for patient care: Diabetes education teaches individuals to 
manage their disease through activities including exercise and blood 
glucose monitoring.

Service: Medical nutrition therapy; 
Importance for patient care: Medical nutrition therapy is a specific 
nutrition service and procedure used to treat illnesses or health 
conditions. It involves an in-depth nutrition assessment, changes in 
diet as appropriate, and follow-up monitoring and evaluation.

Service: Smoking cessation therapy: counseling or drugs; 
Importance for patient care: Individuals with diabetes who smoke are 
more likely to suffer nerve damage and kidney disease. Smoking also 
damages and constricts blood vessels, which can worsen foot ulcers and 
leg infections. In addition, smoking increases blood pressure and blood 
glucose.

Sources: American Association of Diabetes Educators, American Diabetes 
Association, American Dietetic Association, and National Diabetes 
Quality Improvement Alliance.

Note: In addition to the services listed in this table, the Alliance 
also recommends aspirin therapy to help prevent stroke, heart attack, 
and other cardiovascular problems in adults with diabetes. Because 
aspirin is an over-the-counter medication not typically covered by 
health plans, we excluded aspirin therapy from our review.

[A] A1c tests differ from traditional home glucose monitoring, which 
usually involves pricking a finger, putting a drop of blood on a test 
strip, and placing the strip into a meter that displays the level of 
glucose in the blood. A1c tests are done in a health care provider's 
office and measure the average level of glucose in the blood over the 
preceding 3 months. For some patients, daily (or sometimes hourly) self-
testing for glucose level is recommended to provide a short-term 
glucose assessment, but experts recommend at least one A1c test 
annually for all diabetes patients to assess a patient's general 
glucose level.

[End of table]

In addition to such services, according to federal agencies and 
organizations concerned with diabetes patient care, individuals with 
diabetes often need certain supplies to manage their disease. Needed 
supplies may include blood glucose monitors, glucose control solutions 
(used to check the accuracy of testing equipment and test strips), test 
strips, lancets and lancet devices (used to prick the skin for a blood 
sample to self-test blood glucose levels), insulin (when necessary), 
insulin pumps (to administer insulin), disposable needles and syringes 
(also to administer insulin), alcohol swabs, and therapeutic shoes (for 
individuals with severe diabetic foot disease).

Health coverage may be provided through the purchase of insurance 
policies that are subject to state laws and regulations or through 
means other than insurance. Health coverage provided through the 
purchase of insurance in a given state, whether purchased by 
individuals or by employers, is subject to insurance requirements in 
that state, including requirements to cover specified illnesses, 
services, or supplies.[Footnote 17] For example, states often require 
coverage of cancer-screening services such as mammography or tests for 
colorectal cancer.[Footnote 18] These state requirements are in 
addition to coverage requirements established by federal law. In 2001, 
two-thirds of Americans younger than 65 (the age at which people 
generally become eligible for Medicare),[Footnote 19] received health 
coverage through their own employer or that of a family member. Large 
private employers often self-fund their health plans,[Footnote 20] and 
coverage provided by these plans is not subject to state insurance 
regulation, although it is generally subject to federal 
requirements.[Footnote 21] Health coverage provided by the federal 
government is also not subject to state insurance regulation. For 
FEHBP, OPM is responsible for contracting with private health insurance 
carriers to offer health benefit plans to federal employees. By federal 
law, the terms of any FEHBP contract negotiated by OPM that relate to 
coverage or benefits preempt any inconsistent state or local law or 
regulation. OPM routinely preempts state requirements to ensure a 
consistent set of benefits among nationwide FEHBP plans, according to 
an OPM official.[Footnote 22]

Most States Require Insurance Policies to Cover Diabetes Services and 
Supplies, Although Specific Requirements Vary:

In 2004, 47 states had laws or regulations related to coverage of 
diabetes services or supplies, although specific requirements varied by 
state (see fig. 1 and app. II). Forty-five states required insurance 
policies to cover specific services or supplies for diabetes.[Footnote 
23] Two more states, Mississippi and Missouri, required "mandated 
offerings"; that is, these states required insurance policies to 
provide coverage for diabetes at the option of purchasers. Some states' 
requirements applied only in narrow circumstances. For example, Arizona 
and Wisconsin required coverage of diabetes supplies only when a health 
insurance policy covered the treatment of diabetes.[Footnote 24] The 
services most frequently specified in state requirements were diabetes 
education and medical nutrition therapy: 45 states required that 
insurance policies cover diabetes education, and 27 states required 
coverage of medical nutrition therapy.[Footnote 25] State requirements 
may have focused more often on these two services in part because 
national organizations concerned with diabetes patient care--including 
ADA, the American Dietetic Association, and the American Association of 
Diabetes Educators--have supported "model" legislation centered on 
these two services. According to ADA and the American Dietetic 
Association, the organizations focused on these two services in 
particular because others, such as eye and foot exams, were thought to 
be covered by most policies as general medical services. The model 
legislation also includes coverage of "diabetes equipment and 
supplies," and 47 states required such coverage. Twenty-eight states 
identified which supplies must be covered, although their specific 
requirements varied.

Figure 1: Number of States Requiring Coverage of Diabetes Services and 
Supplies, 2004:

[See PDF for image]

[End of figure]

Some states had specific requirements regarding the coverage of certain 
services, such as diabetes education. Forty-two states specified at 
least some criteria for the training or education that health care 
professionals must have to provide diabetes education. These criteria 
varied widely from state to state. To provide diabetes education in 
Louisiana, for example, health professionals must have demonstrated 
expertise in diabetes and must have completed an educational program in 
compliance with the National Standards for Diabetes Self-Management 
Education established by ADA. In contrast, several states required 
educators to be licensed professionals with expertise in diabetes but 
did not define the term expertise. Eight states referred to ADA's 
national standards in setting their requirements for diabetes education 
programs. Some of these states required programs to be consistent with 
these standards, while others mentioned them as an example of 
acceptable standards.

Among the 47 states whose laws or regulations required coverage of 
diabetes supplies, specific coverage requirements varied. For example, 
19 states did not specify which supplies must be covered; 
instead, these states typically required coverage of all medically 
necessary equipment and supplies prescribed by a physician. The 
remaining 28 states specified covered supplies, either in laws or 
regulations, but the number of supplies varied among the states. For 
example, Michigan had requirements related to insulin, blood glucose 
monitors, test strips, lancets, lancet devices, syringes, and insulin 
pumps. In contrast, Mississippi required coverage of equipment and 
supplies, including supplies used in connection with blood glucose 
monitoring and insulin administration, but did not specify which 
supplies. Some states that listed covered supplies also prescribed 
procedures for adding new supplies to the list. For example, in New 
Jersey, the Commissioner for Insurance, in consultation with the 
Commissioner of Health, may update the list of supplies.

While nearly all states have required some coverage of diabetes 
services or supplies in the insurance policies they regulate, some 
states have authorized a class of health insurance policies that are 
not bound by many of the state coverage requirements, which may include 
those for coverage of diabetes services and supplies. Known as 
"flexible health benefit" or "limited-benefit" policies, and typically 
marketed to small employers or individuals, such policies may, through 
lower premiums, reduce the cost of coverage. At least two states, 
Louisiana and Arkansas, have authorized limited-benefit policies that 
are not bound by requirements related to diabetes services and 
supplies.[Footnote 26] Louisiana has authorized such policies for 
individuals not otherwise able to obtain health coverage and for small 
employers (3-35 employees), and Arkansas has authorized them for all 
groups, regardless of size. ADA is concerned that limited-benefit 
policies may not provide sufficient coverage of the services and 
supplies that individuals with diabetes need to manage their condition.

Selected Health Plans Providing Coverage Not Subject to State 
Regulation Cover Most but Not All Diabetes Services and Supplies:

The 3 largest plans participating in FEHBP--Blue Cross and Blue Shield, 
Mail Handlers, and Government Employees Hospital Association, Inc.--and 
the 13 large-employer self-funded plans we contacted covered most of 
the diabetes services and supplies we reviewed. All 16 plans covered at 
least 7 of the 10 diabetes services, as well as at least five of nine 
diabetes supplies. Few of the plans we contacted placed limits on 
coverage for diabetes services and supplies.[Footnote 27]

Three Largest FEHBP Plans Cover Most Diabetes Services and Supplies:

The three largest FEHBP plans covered at least 8 of the 10 diabetes 
services we reviewed (see table 2). Both diabetes education and medical 
nutrition therapy were covered by two of the three plans, although one 
plan placed conditions on these services: diabetes education was 
covered when provided at a hospital and medical nutrition therapy when 
provided by a physician. The three plans stated that coverage 
requirements for diabetes services and supplies applied only in cases 
of medical necessity. The plans generally did not, however, set 
monetary limits on their coverage for diabetes services. One exception 
was smoking cessation therapy, for which one plan set $100 lifetime 
limits per enrollee for both counseling and drug therapy. Another plan 
set $100 lifetime limits per enrollee for smoking cessation counseling.

Table 2: Diabetes Services Covered by the Three Largest FEHBP Plans, 
2004:

Service: Blood glucose test; 
Blue Cross and Blue Shield: X; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Lipid profile; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Urine protein screening; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Eye exam; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Foot exam; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Influenza vaccination; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Blood pressure management; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Smoking cessation therapy; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: Yes; 
Government Employees Hospital Association, Inc.: Yes.

Service: Diabetes education; 
Blue Cross and Blue Shield: Yes; 
Mail Handlers: No; 
Government Employees Hospital Association, Inc.: Yes.

Service: Medical nutrition therapy; 
Blue Cross and Blue Shield: Yes[A]; 
Mail Handlers: No; 
Government Employees Hospital Association, Inc.: Yes.

Source: GAO analysis of data from the three largest FEHBP plans.

[A] Covered for enrollees with a diagnosis of diabetes.

[End of table]

The three FEHBP plans all covered at least seven of nine diabetes 
supplies, including blood glucose monitors, glucose control solutions, 
test strips, lancets and lancet devices, insulin, insulin pumps, and 
disposable needles and syringes. One plan did not cover alcohol swabs, 
and two plans did not cover therapeutic shoes. One plan limited its 
coverage of supplies; specifically, this plan set lifetime durable 
medical equipment limits of $10,000 per person for specific supplies, 
including blood glucose monitors and insulin pumps.

Large Employers' Self-Funded Health Plans Reviewed Cover Most Diabetes 
Services and Supplies:

Each of the 13 large employers' self-funded health plans we reviewed 
covered at least 7 of 10 diabetes services, specifically, blood 
glucose, lipid, and urine tests; eye and foot exams; blood pressure 
management, and influenza vaccinations. The remaining 3 services were 
covered by at least 9 plans (see fig. 2). Among these plans, we found 
limits on coverage only for smoking cessation therapy. One plan, for 
example, had a lifetime maximum of three drug therapy treatments for 
smoking cessation, and another plan had a maximum of two smoking- 
cessation programs per lifetime for each enrollee for both counseling 
and drug therapy.

In a few cases, the plans specified certain conditions for coverage. 
For example, among the 11 plans offering coverage of diabetes 
education, 4 did so only if an employee with diabetes was enrolled in 
the plan's diabetes management program. Three of the 10 plans offering 
coverage of medical nutrition therapy did so only as part of their 
diabetes management program. Of the 9 plans covering smoking cessation 
therapy, 5 restricted coverage to drug therapy and did not cover 
smoking cessation counseling. Most of the self-funded plans stipulated 
that diabetes services and supplies were covered only when medically 
necessary.[Footnote 28] In addition, 7 plans required waiting periods 
ranging from 30 days to 6 months after an employee was hired before 
health coverage began. One plan did not cover preexisting conditions-- 
either an injury or illness--occurring during the 90 days before a 
newly hired employee began the waiting period.

Figure 2: Diabetes Services Covered by 13 Large Employers' Self-Funded 
Health Plans, 2004:

[See PDF for image]

[End of figure]

All 13 self-funded plans covered at least five of nine diabetes 
supplies, including insulin, insulin pumps, disposable needles and 
syringes, test strips, and lancets and lancet devices, and all but 1 
covered blood glucose monitors (see fig. 3). Only 1 of the 13 plans 
reported having limits on the quantity of supplies covered, covering 
one blood glucose monitor per year. Two of the 13 plans reported 
placing conditions on their coverage of supplies. For example, 1 plan 
told us that it allowed up to a 90-day supply of items for each claim, 
and another plan covered therapeutic shoes when prescribed by a 
physician and purchased through an authorized supplier.

Figure 3: Diabetes Supplies Covered by 13 Large Employers' Self-Funded 
Health Plans, 2004:

[See PDF for image]

[End of figure]

Nationwide, Receipt of Diabetes Services and Control of Related Health 
Conditions Are Uneven:

Data from CDC's 2003 nationwide survey showed that individuals with 
diabetes received some but not all diabetes services, and those who had 
health coverage were more likely to have received services than those 
who did not. The proportion of individuals with diabetes receiving 
diabetes services varied widely by type of service and among states. 
Another CDC survey, which included a physical examination of 
participants, indicated that many individuals with diabetes did not 
have their diabetes-related conditions adequately controlled.

Individuals with Diabetes Report Receiving Many but Not All Services:

National data show that individuals with diabetes ages 18 and older 
receive many but not all diabetes services. In a nationwide telephone 
survey conducted in 2003, the majority of individuals with diabetes 
reported receiving at least one of six identified diabetes services for 
which national data were available.[Footnote 29] Substantially fewer 
individuals reported receiving within the past 12 months the five 
services recommended that individuals with diabetes receive at least 
once a year. Although the receipt of services varied by service, half 
or more of the individuals with diabetes reported receiving each given 
service. For example, an estimated 88 percent had received a test for 
blood glucose within the past 12 months, and an estimated 52 percent 
had received diabetes education. A much smaller proportion, 33 percent, 
had received the five services recommended that individuals with 
diabetes receive at least once a year--specifically, a blood glucose 
test, a cholesterol test, an eye exam, a foot exam, and an influenza 
vaccination (see fig. 4).[Footnote 30]

Figure 4: Estimated Nationwide Percentage of Individuals Ages 18 and 
Older with Diabetes Who Reported Receiving Diabetes Services, 2003:

[See PDF for image]

Notes: These nationwide estimates were constructed from available state 
data. Data represent the estimated percentage of individuals ages 18 
and older nationwide who reported receiving a service within the past 
12 months, except for diabetes education, for which respondents were 
asked if they had ever received the service (specifically, participants 
were asked if they had ever taken a course on how to manage their 
diabetes). Data for "Five services" represent the estimated percentage 
of individuals who reported receiving all of five services recommended 
that individuals with diabetes receive at least once a year: a blood 
glucose test, a cholesterol test, a foot exam for sores or irritations, 
an eye exam in which the pupils were dilated, and an influenza 
vaccination.

[End of figure]

CDC's survey also indicated that an estimated 82 percent of individuals 
with diabetes were taking insulin or diabetes medication to control 
their blood glucose.[Footnote 31] Otherwise, use of diabetes supplies 
was not captured in CDC's survey.

Individuals with Diabetes Who Have Health Coverage More Likely to 
Receive Services Than Those Who Lack Coverage:

According to CDC's 2003 survey, in comparison with individuals with 
diabetes who lacked health coverage, a larger proportion who had health 
coverage reported receiving one or more services. For example, an 
estimated 90 percent of individuals with diabetes who had health 
coverage at the time of the survey had received a blood glucose test, 
compared with 71 percent of those who reported not having such coverage 
(see fig. 5). Moreover, the estimated proportion of individuals with 
diabetes who received all of the five diabetes services was more than 
twice as high for those who had coverage than for those who did not. 
For example, although an estimated 35 percent of those with health 
coverage had received a blood glucose test, a cholesterol test, eye 
exam, foot exam, and influenza vaccination, just 14 percent of those 
without health coverage received the same set of services.

Figure 5: Estimated Nationwide Percentage of Individuals Ages 18 and 
Older with Diabetes, With and Without Health Coverage, Who Reported 
Receiving Diabetes Services, 2003:

[See PDF for image]

Notes: These nationwide estimates were constructed from available state 
data. Data represent the estimated percentage of individuals ages 18 
and older nationwide who reported receiving a service within the past 
12 months, except for diabetes education, for which respondents were 
asked if they had ever received the service (specifically, participants 
were asked if they had ever taken a course on how to manage their 
diabetes). Data for "Five services" represent the estimated percentage 
of individuals who reported receiving all of five services recommended 
that individuals with diabetes receive at least once a year: a blood 
glucose test, a cholesterol test, a foot exam for sores or irritations, 
an eye exam in which the pupils were dilated, and an influenza 
vaccination.

[End of figure]

Receipt of Diabetes Services Varies Widely among States:

CDC's 2003 survey showed substantial variation among states in the 
receipt of diabetes services. Depending on the service, the estimated 
state-by-state percentages of individuals with diabetes who reported 
receiving services varied widely. For example, the estimated state-by- 
state percentages of individuals with diabetes who reported receiving 
an eye exam ranged from 55 to 84 percent (see table 3). Despite this 
state-by-state variation, the same services were generally the most 
received across all states. In most states, for example, more 
individuals received blood glucose and cholesterol tests than received 
foot exams or diabetes education.

Table 3: Range among States in Estimates of Diabetes Services Received 
by Individuals with Diabetes, 2003:

Service: Blood glucose (A1c) test; 
State percentages[A]: 74 to 97; 
Number of states[B]: 46.

Service: Cholesterol test; 
State percentages[A]: 79 to 92; 
Number of states[B]: 51.

Service: Foot exam; 
State percentages[A]: 59 to 82; 
Number of states[B]: 45.

Service: Eye exam; 
State percentages[A]: 55 to 84; 
Number of states[B]: 44.

Service: Influenza vaccination; 
State percentages[A]: 46 to 75; 
Number of states[B]: 49.

Service: Diabetes education (ever received); 
State percentages[A]: 37 to 67; 
Number of states[B]: 45.

Service: Five services[C]; 
State percentages[A]: 23 to 48; 
Number of states[B]: 44.

Source: CDC's BRFSS.

[A] State percentages reflect the estimated proportion of individuals 
ages 18 and older with diabetes in a given state who reported receiving 
a service within the past 12 months, except for diabetes education.

[B] Numbers of states vary because not all states provided data for all 
diabetes services in 2003. Because the sample sizes of individuals with 
diabetes reporting receipt of each service for each state were 
relatively small, the confidence intervals were relatively large. Any 
state whose 95 percent confidence interval for any estimate exceeded 
plus or minus 10 percentage points was excluded from this analysis.

[C] "Five services" represents the estimated percentage of individuals 
who reported receiving the five services recommended that individuals 
with diabetes receive at least once a year: a blood glucose test, a 
cholesterol test, a foot exam for sores or irritations, an eye exam in 
which the pupils were dilated, and an influenza vaccination.

[End of table]

Many Individuals with Diabetes Do Not Have Adequate Control of Related 
Conditions That May Increase Their Risk of Complications:

For 1999-2002, data from CDC's NHANES--a nationally representative 
survey that involves a physical examination to assess each 
participant's health--indicated that many individuals with diabetes 
ages 18 and older did not have adequate control of related conditions 
that could lead to health complications.[Footnote 32] Experts say that 
controlling blood glucose and cholesterol levels lowers the risk of 
nerve damage, vision disorders, and cardiovascular disease; detecting 
renal disease early decreases the risk of kidney failure.[Footnote 33] 
Yet data from CDC's NHANES showed that about 19 percent of examined 
participants with diabetes had poor control of their blood 
glucose,[Footnote 34] and about half of them had cholesterol levels 
putting them at increased risk for cardiovascular disease. In addition, 
about 40 percent were at increased risk of renal disease, as evidenced 
by a positive test for abnormal levels of a protein in their 
urine.[Footnote 35] The data also showed that about 38 percent of 
individuals with diabetes who did not have health coverage had glucose 
levels indicative of poor control, compared with about 16 percent of 
those who had health coverage.

Agency Comments:

We provided a draft of this report to CDC for comment. The agency 
provided us with technical comments, which we incorporated into the 
report as appropriate.

As agreed with your offices, unless you publicly announce its contents 
earlier, we plan no further distribution of this report until 30 days 
after its issue date. At that time, we will send copies to interested 
congressional committees and members and make copies available to 
others upon request. In addition, the report will be available at no 
charge on the GAO Web site at http://www.gao.gov.

If you or your staffs have any questions about this report, please 
contact me at (202) 512-7118. Another contact and key contributors to 
this report are listed in appendix III.

Signed by: 

Kathryn G. Allen: 
Director, Health Care--Medicaid and Private Health Insurance Issues:

[End of section]

Appendix I: Scope and Methodology:

To assess health care coverage and receipt of diabetes services and 
supplies, we obtained information from federal health agencies and 
national organizations concerned with diabetes patient care and 
identified 10 services and nine supplies that individuals with diabetes 
often need. To determine the extent to which states require coverage of 
diabetes services and supplies for the health insurance policies they 
regulate, we examined state laws and regulations from September 2004 
through December 2004 related to diabetes and the extent to which they 
required coverage of specific services and supplies. We also reviewed 
information prepared by the American Diabetes Association (ADA) and the 
American Dietetic Association and interviewed officials there, as well 
as from states and the National Conference of State Legislatures. In 
addition, we reviewed state requirements for limited-benefit policies-
-which are not required to comply with coverage requirements usually 
applicable to health insurance--in Louisiana, Arkansas, and Colorado.

To examine the extent to which the largest plans participating in the 
Federal Employees Health Benefits Program (FEHBP) and the largest self- 
funded employer plans cover diabetes services and supplies, we obtained 
information from the three largest national FEHBP plans--Blue Cross and 
Blue Shield, Mail Handlers, and Government Employees Hospital 
Association, Inc.--which together covered approximately 5.3 million 
people in 2003, or about 65 percent of employees, retirees, and their 
dependents covered by FEHBP plans. We also contacted a random sample of 
15 of the 50 largest Fortune 500 companies, ranked by the number of 
employees, regarding their plans' coverage of diabetes services and 
supplies in 2004 and received responses from 13 of them. Together these 
13 large companies, which had self-funded health plans, employed about 
2.4 million people in 2003. Because employers may offer their employees 
more than one health plan option, we asked employers to provide 
coverage information related to the health plan that had the largest 
enrollment. We relied on the information as reported by officials of 
the health plans reviewed and did not independently verify their 
responses. Because of our sampling approach, we cannot generalize our 
findings to all FEHBP plans or to all large employers. Although we 
received responses from most (16 of 18) of the FEHBP plans and 
employers we contacted, our results may still reflect some selection 
bias, in that employers offering more benefits might have been more 
likely to respond than those offering fewer benefits.

To assess information on the extent to which individuals with diabetes 
receive diabetes services and use supplies, we analyzed data for 
individuals ages 18 and older provided by the Centers for Disease 
Control and Prevention (CDC) from two nationwide surveys: the 
Behavioral Risk Factor Surveillance System (BRFSS) for 2003 and the 
National Health and Nutrition Examination Survey (NHANES) for 1999- 
2002:

* BRFSS is a nationwide telephone survey conducted every year by state 
health departments, with technical and methodological assistance 
provided by CDC. A "cross-sectional" or point-in-time survey, BRFSS 
samples the civilian noninstitutionalized population of adults ages 18 
and older in the United States, including the 50 states and the 
District of Columbia;[Footnote 36] all data from BRFSS are self- 
reported. The survey's purpose, methods, and data analyses are 
available at http://www.cdc.gov/brfss. We used data from CDC gathered 
during 2003 about services individuals with diabetes reported receiving 
within the 12 months preceding the survey, which represented the most 
recent information available. BRFSS 2003 included a representative 
sample of 19,162 participants with diabetes. In addition to questions 
from the core sections of the survey, we used questions from a diabetes-
specific section, which included data from 46 states in 2003, to 
collect data on disease management practices from respondents with 
diabetes.

* NHANES is a nationally representative survey, whose data are 
collected every year and released every 2 years by CDC, that samples 
the civilian noninstitutionalized U.S. population. It is a two-part 
survey, consisting of an in-home interview plus a health examination in 
a mobile examination center. Its purpose, methods, and data analyses 
are available at http://www.cdc.gov/nchs/nhanes.htm. We used NHANES 
data from 1999-2002--the most recent information available--for adults 
ages 18 and older, which included a representative sample of 904 
participants with diabetes. We relied on NHANES results from the 
physical examinations, which included laboratory tests, for specific 
test values for individuals who had reported a prior diagnosis of 
diabetes, including tests for blood glucose, cholesterol, and kidney 
disease.

We examined data provided to us by CDC from each survey separately. 
When possible, the data were stratified by health coverage status 
(respondents who reported having health coverage and those who reported 
not having it).[Footnote 37] For both surveys, we used data only from 
respondents who reported receiving a diagnosis of diabetes before the 
survey period. Most of CDC's estimates from BRFSS were stratified by 
state, although we could not develop state-level estimates by health 
coverage; NHANES estimates were limited to the national level. We 
analyzed a total of 10 indicators for diabetes services and supplies 
from both surveys (see table 4).

Table 4: Indicators of Services and Supplies for Managing Diabetes:

Diabetes indicator[A]: Percentage of patients who report receiving one 
or more A1c tests; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients with a measured A1c test 
value >9.0%; 
Data source: NHANES; 
Population: National.

Diabetes indicator[A]: Percentage of patients who report receiving at 
least one cholesterol test; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients with a measured total 
cholesterol value 200 mg/dl; 
Data source: NHANES; 
Population: National.

Diabetes indicator[A]: Percentage of patients who report receiving a 
dilated-eye exam; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients who report receiving at 
least one foot exam for sores or irritations; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients who report receiving an 
influenza immunization[B]; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients who report ever taking a 
diabetes self-management course; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients who report currently 
taking insulin or diabetes medication; 
Data source: BRFSS; 
Population: National and state.

Diabetes indicator[A]: Percentage of patients with a negative test for 
nephropathy (kidney disease)[C]; 
Data source: NHANES; 
Population: National.

Source: CDC.

[A] Unless otherwise noted, we used data from BRFSS about respondents' 
receipt of diabetes services within the past 12 months. NHANES data 
came from 1999-2002.

[B] The BRFSS question asks participants if they have received a "flu 
shot," thus potentially excluding respondents who may have received an 
intranasal immunization for influenza.

[C] A negative test for nephropathy is defined as a ratio of urinary 
albumin to urinary creatinine of <17 for men and <25 for women.

[End of table]

We assessed the reliability of the NHANES and BRFSS data provided by 
CDC by (1) reviewing existing information about the data and the 
methods used to collect them and (2) interviewing and working with 
agency officials knowledgeable about the data. We determined that the 
data were sufficiently reliable for the purposes of this report. Our 
review had several data limitations. First, BRFSS data were self- 
reported for each service we reviewed, and both BRFSS and NHANES used 
self-reported diagnoses of diabetes from participants, a practice that 
can result in recall bias. Second, BRFSS is a telephone survey, which 
limits data collection to individuals who have telephones. Third, both 
surveys are cross-sectional; that is, they provide information at one 
point in time. For example, although health coverage was assessed at 
the time the surveys were conducted, we could not determine whether 
participants' coverage changed over the survey year.

[End of section]

Appendix II Summary of Diabetes Coverage Requirements in State Laws or 
Regulations, 2004:

State: Alabama; 
Requirement related to diabetes: No; 
Diabetes education services: No; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: No; 
Specified supplies: No.

State: Alaska; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes[B]; 
Medical nutrition therapy services[A]: Yes[B]; 
Diabetes supplies: Yes[B]; 
Specified supplies: No.

State: Arizona; 
Requirement related to diabetes: Yes; 
Diabetes education services: No; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes[C]; 
Specified supplies: Yes.

State: Arkansas; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: California; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Colorado; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Connecticut; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Delaware; 
Requirement related to diabetes: Yes; 
Diabetes education services: No; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes[D]; 
Specified supplies: Yes.

State: District of Columbia; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Florida; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Georgia; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Hawaii; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Idaho; 
Requirement related to diabetes: No; 
Diabetes education services: No; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: No; 
Specified supplies: No.

State: Illinois[E]; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes[F].

State: Indiana; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Iowa; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Kansas; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes[G].

State: Kentucky; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Louisiana; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Maine; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Maryland; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Massachusetts; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Michigan; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes[H].

State: Minnesota; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Mississippi[I]; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Missouri[I]; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Montana[E]; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Nebraska; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Nevada; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: New Hampshire; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes[J].

State: New Jersey; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: New Mexico; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: New York; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: North Carolina; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: North Dakota; 
Requirement related to diabetes: No; 
Diabetes education services: No; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: No; 
Specified supplies: No.

State: Ohio; 
Requirement related to diabetes: No; 
Diabetes education services: No; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: No; 
Specified supplies: No.

State: Oklahoma; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Oregon[E]; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Pennsylvania; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Rhode Island; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: South Carolina; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: South Dakota; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Tennessee; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Texas; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Utah; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Vermont; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Virginia; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

State: Washington; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes[K]; 
Specified supplies: Yes.

State: West Virginia; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes; 
Specified supplies: Yes.

State: Wisconsin; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes[L]; 
Medical nutrition therapy services[A]: No; 
Diabetes supplies: Yes[C]; 
Specified supplies: Yes.

State: Wyoming; 
Requirement related to diabetes: Yes; 
Diabetes education services: Yes; 
Medical nutrition therapy services[A]: Yes; 
Diabetes supplies: Yes; 
Specified supplies: No.

Totals; 
Requirement related to diabetes: 47; 
Diabetes education services: 45; 
Medical nutrition therapy services[A]: 27; 
Diabetes supplies: 47; 
Specified supplies: 28.

Source: GAO.

[A] We did not include states with coverage requirements related to 
nutrition that did not refer specifically to medical nutrition therapy. 
As a result, Nevada, Tennessee, Texas, and West Virginia--which 
required coverage of nutrition counseling--and New Jersey and New York-
-which required education that includes information on proper diet--are 
omitted here. We also omitted Florida from this column, although the 
state required coverage of "outpatient self-management training and 
educational services used to treat diabetes" and further stated that 
any policy "may require that nutrition counseling be provided by a 
licensed dietician."

[B] Alaska required coverage of education, medical nutrition therapy, 
and supplies only when coverage was otherwise provided for pharmacy 
services.

[C] Arizona and Wisconsin required coverage of equipment and supplies 
only when a policy covered expenses incurred for the treatment of 
diabetes.

[D] Delaware required coverage of supplies only when the contract or 
policy provided prescription drug coverage.

[E] Requirements in Illinois, Montana, and Oregon applied only to group 
policies.

[F] Illinois required certain supplies--blood glucose monitors, 
cartridges, and lancets and lancing devices--to be covered only if the 
policy provided a durable medical equipment benefit. Coverage of other 
supplies--insulin, syringes and needles, test strips, oral agents to 
control blood sugar, and glucagon emergency kits--was required only if 
the policy provided a drug benefit.

[G] Kansas required coverage of insulin only if coverage was otherwise 
provided for prescription drugs.

[H] Michigan required expense-incurred policies and HMO contracts to 
cover insulin and other medications to treat diabetes only if they 
otherwise provided pharmaceutical coverage.

[I] Mississippi and Missouri required insurance policies to provide 
diabetes coverage only at the option of purchasers, a requirement 
referred to as a "mandated offering."

[J] In New Hampshire, insurers were required to cover medically 
appropriate or necessary equipment only if they covered durable medical 
equipment. Insurers were required to cover insulin, oral agents, and 
equipment only if they provided a prescription rider.

[K] In Washington, coverage for equipment and supplies was required 
only when the contract or plan included pharmacy services.

[L] Wisconsin required coverage of self-management education programs 
only if the policy covered expenses for the treatment of diabetes.

[End of table]

[End of section]

Appendix III: GAO Contact and Staff Acknowledgments:

GAO Contact:

Katherine Iritani (206) 287-4820:

Acknowledgments:

Lisa A. Lusk, Jennifer Major, Adrienne Griffin, Craig Winslow, and 
Ellen W. Chu made key contributions to this report.

FOOTNOTES

[1] Diabetes is a disease in which the body does not produce or 
properly use the hormone insulin, which converts sugar, starches, and 
other food into energy. The vast majority of individuals with diabetes 
are adults. According to CDC, from 1997 through 2002, the annual number 
of newly diagnosed cases among adults rose by 47 percent.

[2] Controlling levels of blood glucose, blood pressure, and 
cholesterol--in combination with other, regular preventive care 
services for eyes, kidneys, and feet--can delay or prevent 
complications.

[3] Unless otherwise stated, "test(s) for blood glucose" or "blood 
glucose test(s)" in this report refers to tests for a specific compound 
in the blood called A1c, also called HbA1c, hemoglobin A1c, or 
glycosylated hemoglobin. An A1c test measures the average level of 
glucose in a patient's blood over the preceding 3 months.

[4] The Employee Retirement Income Security Act of 1974 (ERISA) 
preempts state laws that "relate" to employee benefit plans but 
specifically does not preempt state laws regulating insurance. See 29 
U.S.C.  1144(a) and (b)(2)(A) (2000). Like insurance purchased by 
employers, insurance purchased directly by individuals is subject to 
state regulation.

[5] More than 8 million federal employees, retirees, and their 
dependents were enrolled in FEHBP in 2003.

[6] Under federal law, coverage-or benefit-related provisions in FEHBP 
contracts preempt state or local laws or regulations relating to health 
insurance or plans. See 5 U.S.C.  8902(m)(1) (2000).

[7] We identified 10 diabetes services, including blood glucose tests, 
lipid (cholesterol) management, urine protein screening, eye exams, 
foot exams, influenza immunization, blood pressure management, smoking 
cessation, diabetes self-management education (hereafter called 
diabetes education), and medical nutrition therapy. We also identified 
nine diabetes supplies, including blood glucose monitors, glucose 
control solutions, test strips, lancet devices and lancets, alcohol 
swabs, therapeutic shoes for diabetic foot disease, insulin, insulin 
pumps, and disposable needles and syringes.

[8] Throughout this report, we include the District of Columbia in our 
discussion of states.

[9] Each of these three FEHBP plans offers two coverage options, but 
coverage for the diabetes services and supplies we reviewed was 
identical in both options.

[10] Because employers may offer their employees more than one health 
plan option, we asked employers to provide coverage information related 
to the health plan that had the largest enrollment. One of the 
employers in our review provided different benefits for hourly 
employees than for salaried employees within the same health plan. For 
this health plan, we included information on the coverage for salaried 
employees.

[11] We relied on the information reported by officials of the health 
plans reviewed and did not independently verify their responses. 
Because of our sampling approach, we cannot generalize our findings to 
all FEHBP plans or to all large employers.

[12] The BRFSS data we obtained contained information from 50 states 
and the District of Columbia. Each year the survey asks a range of 
health questions over the telephone, including if respondents have 
previously received a diagnosis of diabetes, whether they have health 
coverage at the time of the survey, and how many times they received 
any of a number of different health services. The survey does not 
identify what type of health coverage a respondent has, that is, 
whether a respondent is covered by a private health plan or a program 
such as Medicare, the federal health program that covers adults ages 65 
and older and certain individuals with disabilities.

[13] Estimates from BRFSS and NHANES were analyzed separately and, when 
possible, stratified by health coverage (respondents with health 
coverage and those without). For both surveys, the analysis used data 
only for the sample reporting a diagnosis of diabetes before the survey 
period, excluding women with gestational diabetes. We excluded 
estimates whose 95 percent confidence intervals exceeded plus or minus 
10 percentage points. Most estimates from BRFSS were stratified by 
state, although state estimates could not be broken down by health 
coverage; NHANES estimates were limited to the national level.

[14] CDC estimates that more than 200,000 people under 20 years of age 
had diabetes in 2002, but no data currently exist to determine the 
extent to which type 2 diabetes has emerged among U.S. children and 
adolescents.

[15] American Diabetes Association, "Economic Costs of Diabetes in the 
U.S. in 2002," Diabetes Care, vol. 26, no. 3 (2003).

[16] The Alliance uses nine services--blood glucose (A1c) management, 
lipid (cholesterol) management, urine protein screening, eye exams, 
foot exams, influenza immunization, blood pressure management, aspirin 
therapy, and smoking cessation therapy--as performance measures to 
assess and report on the quality of diabetes care for adults with 
diabetes. For women of childbearing age with diabetes, the Alliance 
also recommends pre-pregnancy counseling on the importance of glucose 
management before conception.

[17] Health insurance policies may also cover services or supplies that 
they are not required to cover. 

[18] See Private Health Insurance: Coverage of Key Colorectal Cancer 
Screening Tests Is Common but Not Universal, GAO-04-713 (Washington, 
D.C.: June 17, 2004), and Private Health Insurance: Federal and State 
Requirements Affecting Coverage Offered by Small Businesses, GAO-03-
1133 (Washington D.C.: Sept. 30, 2003).

[19] Medicare provided health coverage to almost 35 million 
beneficiaries ages 65 and older and 6 million individuals with 
disabilities in 2002 (the most recent data available), including 
individuals with end-stage renal disease. Medicare covers the diabetes 
services that we reviewed, except smoking cessation therapy, and the 
diabetes supplies that we reviewed, except alcohol swabs and disposable 
needles and syringes. The program generally does not cover insulin, 
although it may cover insulin when used with an insulin pump.

[20] In 2002, about 78 percent of employers with more than 500 
employees offered at least one self-funded plan, compared with about 29 
percent of employers that had 100-499 employees and about 13 percent of 
small employers (those with fewer than 50 employees).

[21] The most significant of these are included in ERISA. See 29 U.S.C. 
 1001 et. seq. (2000). ERISA does not require that any employer 
provide health coverage. For most employers that do provide health 
coverage, it specifies several requirements, but coverage for diabetes 
services and supplies is not among them.

[22] OPM does not impose specific coverage requirements on FEHBP plans, 
including for diabetes services and supplies.

[23] Alabama, Idaho, North Dakota, and Ohio did not require coverage of 
diabetes services or supplies. Except for Idaho, these states have 
considered or are considering legislation to require coverage of 
specific diabetes services or supplies. State requirements generally 
applied to both individual and group health insurance policies, but 
requirements in Illinois, Montana, and Oregon applied only to group 
policies. Alaska's requirements applied only to policies covering 
pharmacy services.

[24] Wisconsin law also required coverage of diabetes education 
programs only if the policy covered expenses for the treatment of 
diabetes.

[25] In addition, six states required coverage of nutrition counseling 
or education that includes information on proper diet. Florida, which 
we did not count among these six, required coverage of "outpatient self-
management training and educational services used to treat diabetes" 
and stated that any policy "may require that nutrition counseling be 
provided by a licensed dietician."

[26] According to one study, at least 11 states had legislation as of 
2004 to allow the marketing of policies that do not meet their usual 
coverage requirements; this study, however, did not specify whether the 
states' legislation included provisions related to diabetes [I. 
Friedenzohn, "Limited-Benefit Policies: Public and Private Sector 
Experiences," Academy Health Issue Brief, vol. V, no. 1 (2004)]. At 
least one state, Colorado, required health insurance policies to comply 
with some state coverage requirements, including those for diabetes 
services and supplies, but not with others, including those for 
mammography and prostate cancer screening.

[27] Other factors, outside the scope of this review, such as high co- 
payments, high deductibles, or transitions in health coverage when 
individuals change employers, may create financial and access-to-care 
barriers for individuals with diabetes, according to a February 2005 
report [Karen Pollitz et al., Falling through the Cracks: Stories of 
How Health Insurance Can Fail People with Diabetes (Washington, D.C.: 
Georgetown University Health Policy Institute and American Diabetes 
Association, Feb. 8, 2005)]. 

[28] For example, one health plan told us that it would pay for 
medically necessary services, supplies, or treatments that it considers 
to be "reasonable, necessary, and customary," which means that such 
services, supplies, or treatments must be appropriate and consistent 
with the diagnosis or symptoms; consistent with accepted medical 
standards; not experimental or investigational; not provided solely on 
a convenience or personal basis; and employed appropriately, 
effectively, and safely with respect to the type and level of care.

[29] CDC's 2003 BRFSS included a representative sample of 19,162 
participants from 50 states and the District of Columbia who reported 
receiving a diagnosis of diabetes from a physician before the survey 
period.

[30] The national BRFSS data had information on 6 of the 10 services we 
reviewed for managing diabetes, specifically, A1c tests for blood 
glucose, cholesterol tests, eye exams, foot exams, influenza 
vaccinations, and diabetes education. With the exception of diabetes 
education, experts recommend that individuals with diabetes receive 
these services at least once a year. We selected 5 of these services 
for a combined estimate of services recommended that individuals with 
diabetes receive at least once a year--specifically, A1c tests for 
blood glucose, cholesterol tests, eye exams, foot exams, and influenza 
vaccinations. The 4 services absent from the national data were urine 
protein screening, blood pressure management, medical nutrition 
therapy, and smoking cessation therapy.

[31] Insulin delivery typically requires use of supplies such as 
insulin pumps or needles and syringes.

[32] CDC's NHANES included a nationally representative sample of 904 
participants who reported a diagnosis of diabetes.

[33] The Diabetes Control and Complications Trial Research Group, "The 
Effect of Intensive Treatment of Diabetes on the Development and 
Progression of Long-Term Complications in Insulin-Dependent Diabetes 
Mellitus," New England Journal of Medicine, vol. 329 (1993); and U.K. 
Prospective Diabetes Study Group, "Association of Glycaemia and 
Macrovascular and Microvascular Complications of Type 2 Diabetes: 
Prospective Observational Study," British Medical Journal, vol. 321 
(2000).

[34] Poor control of blood glucose is measured by the Alliance as an 
A1c value greater than 9 percent.

[35] Diabetes is the leading cause of end-stage renal disease.

[36] Although CDC's BRFSS is conducted in Puerto Rico, the Virgin 
Islands, and Guam as well, we did not include these territories in our 
review.

[37] Specifically, BRFSS asked respondents, "Do you have any kind of 
health care coverage, including health insurance, prepaid plans such as 
HMOs, or government plans such as Medicare?" NHANES asked about health 
insurance status, including the type of coverage, but we did not 
stratify NHANES data by the type of health coverage because of 
insufficient sample sizes of respondents with diabetes. We did not 
identify any data sources on the number of individuals having coverage 
subject to state insurance requirements or not subject to state 
requirements. We therefore could not assess whether individuals with 
different types of coverage differed in receipt of diabetes services 
and supplies.

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