OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

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

sHB-5233

AN ACT CONCERNING HEALTH INSURANCE COVERAGE FOR TOMOSYNTHESIS FOR BREAST CANCER SCREENINGS.

OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 17 $

FY 18 $

State Comptroller - Fringe Benefits (State Employees and Retiree Health Accounts)

GF&TF - Cost

Approximately

$90,000 to $370,000

Approximately

$178,000 to $738,000

The State

Uncertain - Cost

Approximately

$49,000 to $202,000

Approximately

$97,000 to $404,000

Note: GF&TF=General Fund & Transportation Fund

Municipal Impact:

Municipalities

Effect

FY 17 $

FY 18 $

Various Municipalities

STATE MANDATE - Cost

Approximately

$53,000 to $221,000

Approximately

$107,000 to $442,000

Explanation

The bill will result in a cost to the state employee and retiree health plan1, municipalities, and the state, for providing coverage for breast tomosynthesis at the option of the patient. The total estimated cost to the state in FY 17 is between $139,000 to $572,000 and $275,000 to $1,142,000 in FY 18. This cost is attributable to (1) the estimated cost to the state plan in FY 17 of between $90,000 to $370,000 and $178,000 to $738,000 in FY 18 and (2) the cost to the state pursuant to the federal Affordable Care Act (ACA) (see below) in FY 17 of between $49,000 to $202,000 and $97,000 to $404,000 FY 18. The cost to fully insured municipalities in FY 17 is between $53,000 to $221,000 and $107,000 to $442,000 in FY 18.2

The fiscal impact assumes ultrasound claims will be replaced with tomosynthesis claims to some extent. The fiscal impact may be mitigated based on actual utilization and the availability of tomosynthesis.

The state plan does not currently provide coverage for tomosynthesis. The procedure is currently considered investigational under the state employee and retiree health plan and not medically necessary. In addition, the cost to the state plan and municipalities may be mitigated to the extent the plans are able to utilize administrative methods such as prior authorization to approve coverage for certain procedures.

Municipal Impact

As previously stated, the bill may increase costs to certain fully insured, municipal plans that do not currently provide coverage for tomosynthesis. The coverage requirements may result in increased premium costs when municipalities enter into new health insurance contracts after January 1, 2017. In addition, many municipal health plans are recognized as “grandfathered” health plans under the ACA.3 It is unclear what effect the adoption of certain health mandates will have on the grandfathered status of certain municipal plans under ACA. Pursuant to federal law, self-insured health plans are exempt from state health mandates.

The State and the federal ACA

Lastly, the ACA requires that, the state's health exchange's qualified health plans (QHPs), include a federally defined essential health benefits package (EHB). The federal government is allowing states to choose a benchmark plan to serve as the EHB until 2016 when the federal government is anticipated to revisit the EHB.

While states are allowed to mandate benefits in excess of the EHB, the federal law requires the state to defray the cost of any such additional mandated benefits for all plans sold in the exchange, by reimbursing the carrier or the insured for the excess coverage. Absent further federal guidance, state mandated benefits enacted after December 31, 2011 cannot be considered part of the EHB unless they are already part of the benchmark plan.4 However, neither the agency nor the mechanism for the state to pay these costs has been established.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject to (1) inflation, (2) the number of covered lives in the state, municipal and exchange health plans, and (3) the utilization of services.

Sources:

Department of Labor

 

Office of the State Comptroller

1 The state employee and retiree health plan is a self-insured health plan. Pursuant to federal law, self-insured health plans are exempt from state health mandates. However, the state has traditionally adopted all state health mandates.

2 The estimated cost is based on the per member per month (PMPM) rate of $0.07 to $0.29, which assume 25% replacement of ultrasounds and 100% replacement respectively. The PMPM assumes a cost differential between ultrasounds and tomosynthesis. The cost estimate for the state employee plan is based on the plan membership as of January 2016; municipal impact is based on Dept. of Labor employment information as of January 2016; state impact based on Exchange enrollment is as of February 2016. Exchange enrollment excludes Medicaid enrollees.

3 Grandfathered plans include most group insurance plans and some individual health plans created or purchased on or before March 23, 2010.

4 Source: Dept. of Health and Human Services. Frequently Asked Questions on Essential Health Benefits Bulletin (February 21, 2012).