LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 186 HLS 23RS 281
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: June 12, 2023 6:55 AM Author: DAVIS
Dept./Agy.: Insurance and Office of Group Benefits
Subject: Medically Necessary Fertility Preservation Act Analyst: Patrice Thomas
INSURANCE/HEALTH EN INCREASE SG EX See Note Page 1 of 2
Provides relative to health insurance coverage for standard fertility preservation services
Proposed law requires health coverage plans to provide coverage for medically necessary expenses for standard fertility preservation
services when a medically necessary treatment may directly or indirectly cause iatrogenic infertility. Proposed law requires health
coverage plans to provide coverage for standard fertility preservation services for an individual diagnosed with cancer for which cancer
treatment may directly or indirectly cause iatrogenic infertility. Proposed law provides that health coverage plans shall not require
preauthorization. Proposed law allows religious employers may obtain an exemption. Proposed law provides for definitions of “health
cover plan”, “iatrogenic infertility”, “medical treatment that may directly or indirectly cause iatrogenic infertility”, “religious employer”, and
“standard fertility preservation services”. Proposed law is known as “The Medically Necessary Fertility Preservation Act”. Proposed law
effective January 1, 2024 (new health coverage plans) and no later than January 1, 2025 (existing health coverage plans). Proposed law
is not effective for health plans offered through the federally-facilitated Health Insurance Marketplace until an appropriation is provided by
the legislature.
EXPENDITURES 2023-24 2024-25 2025-26 2026-27 2027-28 5 -YEAR TOTAL
State Gen. Fd. INCREASE INCREASE INCREASE INCREASE INCREASE
Agy. Self-Gen. INCREASE INCREASE INCREASE INCREASE INCREASE
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total
REVENUES 2023-24 2024-25 2025-26 2026-27 2027-28 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. SEE BELOW SEE BELOW SEE BELOW SEE BELOW SEE BELOW
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total
EXPENDITURE EXPLANATION
Proposed law will increase Self-Generated Revenue expenditures within the Office of Group Benefits (OGB) beginning in FY 24 and increase
State General Fund expenditures associated with a mandate to health insurance policies issued under the insurance exchanges beginning
in FY 24 and subsequent fiscal years. For the insurance exchanges, any state benefit mandate, through legislative or regulatory action,
that exceeds what is considered an essential health benefit (EHB) would subject the state to defrayal costs in accordance with the
Affordable Care Act (ACA). The proposed law would be considered a state benefit mandate; therefore, the state may be required to make
payments to defray the cost of additional required benefits specified under this proposed law.
Office of Group Benefits Impact (Self-Generated Revenue Impact)
Proposed law increases expenditures within the Office of Group Benefits (OGB). Proposed law requires OGB to cover female and male
standard fertility preservation services for members with cancer diagnoses and treatment of which may causes iatrogenic infertility. Based
upon the assumptions listed below, the expenditures to cover this benefit range are as follows:
FY 23-24* FY 24-25 FY 25-26 FY 26-27 FY 27-28 Total
Low $ 82,533 $171,670 $178,537 $ 185,678 $ 193,105 $ 894,057
High $453,933 $944,181 $981,948 $1,021,226 $1,062,075 $4,917,296
*FY 23-24 represent 6 months of estimated claims expenditures
Unless OGB Fund Balance is utilized, SGF appropriation will be required to cover the state portion of the increase in premium costs, which
is approximately 41%. As of February 2023, OGB reports a $434 M fund balance.
The expenditure estimate is based upon the following assumptions: (1) As of 4/01/2023, the current OGB member population in the five
self-funded health plans is 165,331 (excluding 43,563 Medicare primary members). Membership will remain constant. (2) The coverage
will become effective on 1/01/2024. (3) No change in OGB self-funded health plan membership in future fiscal years from current levels.
(4) PMPM cost estimate provided by BCBSLA range from $0.08 pmpm (low) or $0.44 pmpm (high). (5) In future fiscal years, a medical
inflation factor of 4%.
See EXPENDITURE EXPLANATION on Page 2
REVENUE EXPLANATION
The Office of Group Benefits (OGB) does not anticipate the proposed law to require premium increases, therefore there is no impact self-
generated revenues collected from premiums. OGB has indicated the estimated costs associated with coverage of female and male
standard fertility preservation services for members with cancer diagnoses infertility may be absorbed by the existing fund balance
reserve. However, to the extent other legislative instruments that are enacted expand covered medical and pharmacy benefits, the
cumulative impact may be material and require OGB to increase premiums to maintain an actuarially sound fund balance of $250 M.
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} x 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
13.5.2 >= $500,000 Annual Tax or Fee Evan Brasseaux
6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} or a Net Fee Decrease {S} Interim Deputy Fiscal Officer
 LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 186 HLS 23RS 281
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: June 12, 2023 6:55 AM Author: DAVIS
Dept./Agy.: Insurance and Office of Group Benefits
Subject: Medically Necessary Fertility Preservation Act Analyst: Patrice Thomas
CONTINUED EXPLANATION from page one: Page 2 of 2
EXPENDITURE EXPLANATION Continued from Page 1
Based on the aforementioned methodology on page one, the assumption that coverage will only be in place for 6 months in FY 24 due to
the January 1, 2024 effective date, the per member per month (PMPM) cost estimates range from a low of $0.08 pmpm to a high of $0.44
pmpm, and a medical inflation (MI) factor of 4% compounding annually, below are expenditure calculations utilized to project the cost
within OGB utilizing the assumptions listed on page one.
Expenditure Calculations
Expenditure Calculations = membership population x PMPM cost x 12 months
Base Cost (Low) = $158,718 = 165,331 x $0.08 x 12 months
Base Cost (High) = $872,948 = 165,331 x $0.44 x 12 months
FY 24 (Low) = $165,067 = $158,718 x 4% MI ($68,087 SGF)
FY 24 (High) = $907,866 = $872,948 x 4% MI ($374,476 SGF)
FY 25 (Low) = $171,670 = $165,067 x 4% MI ($70,810 SGF)
FY 25 (High) = $944,181 = $907,866 x 4% MI ($389,455 SGF)
FY 26 (Low) = $178,537 = $171,670 x 4% MI ($73,643 SGF)
FY 26 (High) = $981,948 = $944,181 x 4% MI ($405,033 SGF)
FY 27 (Low) = $ 185,678 = $178,537 x 4% MI ($76,588 SGF)
FY 27 (High) = $1,021,266 = $981,948 x 4% MI ($421,234 SGF)
FY 28 (Low) = $ 193,105 = $185,678 x 4% MI ($79,652 SGF)
FY 28 (High) = $1,062,075 = $1,021,266 x 4% MI ($438,084 SGF)
Total (Low)* = $ 894,057 ($ 368,780 SGF)
Total (High)* = $4,917,296 ($2,028,282 SGF)
*The Total does not include the Base Costs.
Insurance Exchanges Impact (State General Fund Impact)
Proposed law may increase SGF expenditures beginning in FY 24 and subsequent fiscal years according to an analysis provided by the LDI
health actuary. The state would be required to fund health claims expenditures associated with female and male standard fertility
preservation services as required in the proposed law for policies issued by qualified health plans through the health insurance exchange
beginning in FY 24 with estimated costs totaling approximately $58,000 to $324,000 SGF and a potential phase-up to over $156,000 to
$881,000 SGF by FY 28 and beyond. Claims expenses associated with the proposed law would be paid out by the State Treasury
Department. LDI bases this analysis on the following assumptions: the calculations are on a fiscal year basis; the exchange population is
approximately 120,000 and the insured population is assumed to be stationary; medical cost inflation is 5% in FY 24 and 8% in
subsequent years; the premium loss ratio is 85%; and the estimated cost is between $0.08 PMPM and $0.45 PMPM over the entire
insured population. Based upon the aforementioned assumptions, the estimated annual cost increases for insurance providers
associated with claims are as follows:
Aggregate Cost Determination
Aggregate cost = exchange population x PMPM cost x 12 months
FY 24 (Low) - 120,000 x $0.08 PMPM x 12 months = $115,200 ($57,600)*
FY 24 (High) - 120,000 x $0.45 PMPM x 12 months = $648,000 ($324,000)*
FY 25 (Low) - $115,200 x 8% MI = $124,416
FY 25 (High) - $648,000 x 8% MI = $699,840
FY 26 (Low) - $124,416 x 8% MI = $134,369
FY 26 (High) - $699,840 x 8% MI = $755,827
FY 27 (Low) - $134,369 x 8% MI = $145,119
FY 27 (High) - $755,827 x 8% MI = $816,293
FY 28 (Low) - $145,119 x 8% MI = $156,729
FY 28 (High) - $816,293 x 8% MI = $881,596
*FY 23-24 represent 6 months of estimated claims expenditures
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} x 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
13.5.2 >= $500,000 Annual Tax or Fee Evan Brasseaux
6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} or a Net Fee Decrease {S} Interim Deputy Fiscal Officer