OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http: //www. cga. ct. gov/ofa

sHB-5617

AN ACT MAKING REVISIONS TO THE CHARTER OAK HEALTH PLAN.

OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 09 $

FY 10 $

Department of Social Services

GF - Cost

Indeterminate

Indeterminate

Comptroller

GF - Cost

150,000

150,000

Municipal Impact: None

Explanation

The bill eliminates the requirement that an enrollee has been uninsured for at least 6 months. This provision would likely increase enrollment in the Charter Oak Plan. To the extent that these increases occur in the state subsidized portion of the program, additional state costs would result.

The bill also requires that comprehensive mental health services be included in the Charter Oak Plan. The bill also requires contractors under the Charter Oak Plan to provide access to an external appeals process. These changes would likely increase the overall costs of the program. Should the state still maintain a maximum monthly premium of $250, these increased program costs will be borne by the state. Without actuarial analysis, the extent of these increased costs cannot be estimated.

The bill further requires DSS to report monthly to the General Assembly on Charter Oak implementation. The department would incur a minimal administrative cost from this reporting requirement.

The bill requires the Comptroller to contract with an actuary to analyze the feasibility and sustainability of the Charter Oak Health Plan under the proposed design. It is anticipated this would require $150,000 to undertake. No funds are provided in sHB 5021 (the budget bill, as favorably reported by the Appropriations Committee) for this actuarial analysis.

Finally, this bill exempts a consortium of federally qualified health centers that provides services only to the Department of Social Services from certain minimum reserve requirements. As this bill conforms statute to the recent operational interpretation, there is no fiscal impact.

It should be noted that the Charter Oak Plan has not yet been implemented. As such, the Office of Fiscal Analysis has no data on the cost of the program or on the enrollment. The analysis above is based on the program model and data assumptions contained in the Governors FY09 budget revisions. The Governor's model assumes that 19,200 individuals will be enrolled in the program in the first year of operation. Of these, 13,700 are expected to be state subsidized.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject to inflation.