Insurance-coverage of inherited enzymatic disorders.

14LSO-0277.C2

FISCAL NOTE

	FY 2015		FY 2016	FY 2017
NON-ADMINISTRATIVE IMPACT
Anticipated Revenue (Decrease):
GENERAL FUND		($140,000)	($147,200)	($147,200)

Source of revenue decrease:

The source of the revenue decrease is the premium tax credit.  Each insurer authorized to sell insurance in Wyoming must report total direct premium income to the Wyoming Department of Insurance.  The insurer is then taxed on premium income at a rate of .75%.  The premium tax collected by the Wyoming Insurance Department is deposited directly into the General Fund.  The legislation proposes to grant a credit against the premium tax in proportion to enzymatic claims received by each insurer. 

Assumptions:

It is estimated that there are currently 20 cases of enzymatic disorders in Wyoming.  The treatment costs approximately $600/month.  Therefore, the total cost to the state is approximately $140,000.

The rate of enzymatic disorder is approximately 1 in every 15,000 births.  There are approximately 7,000 births in Wyoming every year.  Based on these rates, the assumption is that within the next three years, there will be at least one additional person in Wyoming with enzymatic disorder.  Therefore, the cost for future years will be increased to $147,200 per year.

The state essential health benefit benchmark plan selected by the federal government does not include enzymatic disorder, therefore the state must defray the cost of claims.  This projection is based on the assumption that the state will maintain the state benchmark plan for the next three fiscal years.  Note that the Centers of Medicare and Medicaid Services have stated that they intend to propose a process for updating state benchmark plans for 2016 plan years.  If Wyoming updates the state benchmark plan to include enzymatic disorder, the FY 2016 and 2017 revenue decreases could be $0.

This legislation will create some additional administrative burden such as developing a verification system of enzymatic disorder claims, amending the tax reporting form for insurance carriers and additional hours spent by staff to process the tax credits.  The administrative burden will be absorbed by the current staff without the need for additional expenditures. 

Prepared by:   Kelley Shepp, LSO     Phone: 307-777-7881

(Information provided by: Jeri Melinkovich, Department of Insurance 

Phone: 307-777-6870)