OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

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

sSB-10

AN ACT CONCERNING INSURANCE COVERAGE FOR BREAST MAGNETIC RESONANCE IMAGING.

As Amended by Senate "A" (LCO 4992), Senate "B" (LCO 5493), Senate "D" (LCO 6646)

House Calendar No. : 537

Senate Calendar No. : 71

OFA Fiscal Note

State Impact: None in FY 12 and FY 13, See below for out years

Municipal Impact:

Municipalities

Effect

FY 12 $

FY 13 $

Various Municipalities

STATE MANDATE - Cost

Potential

Potential

Explanation

Sections 1 and 2 of the bill do not result in a fiscal impact to the state in FY 12 and FY 13. The state employee health plan currently provides coverage for magnetic resonance imaging (MRI) of the breast in accordance with the guidelines set forth in the bill. In addition, coverage requirements specified in the bill for breast ultrasounds result in no fiscal impact as the state employee health plan currently provides coverage in accordance with existing law.

Sections 1 and 2 may increase costs to certain fully insured municipal plans that do not currently provide breast MRI coverage as mandated by the bill. The coverage requirements may result in increased premium costs when municipalities enter into new health insurance contracts after January 1, 2012. Secondly, coverage requirements specified in the bill for breast ultrasounds result in no fiscal impact as the bill conforms to current law. Due to federal law, municipalities with self-insured plans are exempt from state health insurance benefit mandates.

Many municipal health plans are recognized as “grandfathered” health plans under the Patient Protection and Affordable Care Act (PPACA)1. It is unclear what effect the adoption of certain health mandates will have on the grandfathered status municipal plans PPACA2.

Section 3 of the bill may result in a fiscal impact to municipalities to the extent that joining with special taxing districts for the purpose of providing medical or health benefits may affect health care premiums.

Senate “A” removes the sunset provision in the underlying bill for mammogram, ultrasound, and MRI coverage and results in the potential fiscal impact identified in the out-years.

Senate “B” 1) restores existing law requiring coverage of breast ultrasound screenings in certain circumstances 2) requires breast MRI coverage in certain circumstances and 3) removes a requirement that breast ultrasounds and MRI coverage be provided in accordance with organizations named in the underlying bill. These changes result in the fiscal impact identified for Sections 1 and 2.

Senate “D” includes “districts” in the definition of “municipality” for the purposes of municipalities and boards of education entering into agreements to act as a single entity to provide medical or health benefits. The change results in the fiscal impact identified for Section 3.

The Out Years

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

The federal health care reform act requires that, effective January 1, 2014; all states must establish a health benefit exchange, which will offer qualified plans that must include a federally defined essential benefits package. While states are allowed to mandate benefits in excess of the basic package, the federal law appears to require the state to pay the cost of any such additional mandated benefits. The extent of these costs will depend on the mandates included in the federal essential benefit package, which have not yet been determined. Neither the agency nor mechanism for the state to pay these costs has been established.

The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely for the purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

1 Grandfathered plans include most group insurance plans and some individual health plans created or purchased on or before March 23, 2010. Pursuant to the PPACA, all health plans, including those with grandfathered status are required to provide the following as of September 23, 2010: 1) No lifetime limits on coverage, 2) No rescissions of coverage when individual gets sick or has previously made an unintentional error on an application, and 3) Extension of parents' coverage to young adults until age 26. (www. healthcare. gov)

2 According to the PPACA, compared to the plans' policies as of March 23, 2010, grandfathered plans who make any of the following changes within a certain margin may lose their grandfathered status: 1) Significantly cut or reduce benefits, 2) Raise co-insurance charges, 3) Significantly raise co-payment charges, 4) Significantly raise deductibles, 5) Significantly lower employer contributions, and 5) Add or tighten annual limits on what insurer pays. (www. healthcare. gov)