OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 ↓ (860) 240-0200

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

sSB-301

AN ACT CONCERNING HEALTH INSURANCE COVERAGE FOR AUTISM SPECTRUM DISORDERS.

OFA Fiscal Note

State Impact:

Note: GF=General Fund

Municipal Impact:

Explanation

This mandate expanding coverage for the diagnosis and treatment of autism spectrum disorders is not anticipated to impact the state employee and retiree health plan until after the plan is renewed on July 1, 2011. The mandate requires coverage of applied behavior analysis (ABA) behavioral therapy for children under 13 years of age as well as certain prescribed drugs and direct psychiatric and psychological services. The bill permits a policy to establish a maximum annual dollar limit for behavioral therapy of $50,000 for children less than 9 years of age and $35,000 for children 9-12 years old. It also specifies that it does not limit or affect other covered benefits including state mental and nervous condition law, state birth-to-three program, or a board of education's obligation to provide individualized education program services.

The state plan currently covers autism diagnosis as well as physical therapy, speech therapy and occupational therapy for the period of time that the patient continues to make progress. Once it is determined that progress is no longer being made the plan's current coverage ends.

Autism evaluation and treatment is a mandated benefit in 11 other states. Although mandate legislation varies from state to state, the average additional cost of autism evaluation and treatment mandates is less than 1% of total premiums. ¹ Presently, one component of this mandate – coverage of ABA services, is almost universally excluded from health coverage. This lack of existing data makes it difficult to establish cost estimates for the required ABA component despite the fact that such behavioral therapies represent the most significant fiscal impact of the bill's mandated benefits. ABA programs are generally geared to pre-school aged children and can involve up to 30-40 hours per week of intensive therapy. As a result, families unable to make such a time commitment may choose to forgo utilizing this enhanced benefit for alternate services.

The Birth to Three Program in the Department of Developmental Services has approximately 275 children receiving autism services. On average the agency spends $2,000 per month per child on the ABA services whose coverage is mandated under the bill. It is anticipated that the bill will increase the insurance reimbursement the state receives for approximately 100 children in the program resulting in a half-year savings of $1. 2 million in FY 10 and an annualized savings of $2. 4 million in FY 11.

The mandate would likely impact municipalities that have fully insured health plans and do not currently cover the behavioral services required. The coverage requirements effective January 1, 2010 may result in increased premium costs when municipalities enter into new contracts for health insurance. Due to federal law, municipalities with self-insured health plans are exempt from state health insurance benefit mandates.

The Out Years

Lack of existing data makes it difficult to establish cost estimates for the mandated ABA component of the bill. It is estimated that the state employee and retiree health plan will incur an annual cost of $1. 2 million beginning in FY 12 as a result of expanding coverage for behavioral therapies, including ABA services. It is anticipated that the bill will increase the insurance reimbursement the state receives for the Birth to Three program resulting in an annualized savings of $2. 4 million. As previously stated, the mandate's coverage requirements may also result in increased premium costs when municipalities enter into new health insurance contracts after January 1, 2010. The annualized ongoing fiscal impact identified above would continue into the future subject to inflation.

Sources: Department of Developmental Services, Birth to Three website, Municipal Employees Health Insurance Plan (MEHIP) Schedule of Benefits, State Employee Health Plan Subscriber Agreement, “Health Insurance Mandates in the States 2008” by Council for Affordable Health Insurance, Office of the State Comptroller.