FISCAL NOTE
Date Requested: January 14, 2023
Time Requested: 02:59 PM |
| Agency: |
Bureau for Medical Services |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1273 |
Introduced |
HB2086 |
|
|---|
| CBD Subject: |
|
|---|
|
FUND(S):
0403 - Div of Human Services General Administration Fund, 8722 - Cons Federal Funds Div Human Services Gen Admn Fd
Sources of Revenue:
Other Fund General and Federal
Legislation creates:
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to increase the number of pain management visits insurance companies must cover under the opioid reduction act. The proposed bill increases the number of visits from 20 to 40 per event for physical therapy, occupational therapy, osteopathic manipulation, a chronic pain management program, and chiropractic services.
The Department estimates the cost of the proposed legislation to be $8,798,489 in current expenses ($6,605,906 in federal funds and $2,192,583 in state funds).
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2023
Increase/Decrease
(use"-") |
2024
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
8,798,489 |
8,798,489 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The proposed legislation is similar to 2019’s HB 2768 which went into effect 10/8/2019. HB 2086 allows for 40 total visits across all the treatment modalities, whereas HB 2768 only allowed for 20 visits in total. The BMS actuary vendor has reviewed claims related to the services identified under HB 2768 and estimated that increasing the visit limit will result in a 60% increase in paid claims. The total increase is $8,798,489 in annual expenses for the proposed legislation ($6,605,906 in federal funds and $2,192,583 in state funds).
Paid claims above the 20-visit limit for SY2022 were pulled from the data warehouse as a baseline for the estimate. Milliman, the BMS actuarial vendor, maintains estimates of the impacts of various service limitations on a commercial population, including those for physical therapy. They compared the commercial estimates with West Virginia’s SFY 2022 managed care data and found the commercial limits to be a reasonable proxy for WV’s Medicaid population. The Milliman model estimates that increasing the visit limit from 20 visits to 40 visits will increase expenditures by 60%. The 60% was applied to SFY2022 costs of $14,664,148 (note: total patient costs that exceeded the 20-visit limit).
The estimate does not include any adjustment for incurred but not paid (IBNP) claims. The estimate similarly does not reflect any adjustments for changes in membership that may be expected due to resumption of redeterminations in April 2023. However, it similarly does not include any adjustments for potential impacts of the COVID-19 PHE on the SFY 2022 utilization. Actual results will vary from our assumptions depending on medical management protocols, changes in membership and acuity, and other random and non-random factors.
Memorandum
Please identify any areas of vagueness, technical defects, reasons a bill would not have a fiscal impact, and/or any special issues not captured elsewhere on this form.
Person submitting Fiscal Note: Jeffrey H. Coben
Email Address: dhhrsecretary@wv.gov