Health Mandates Mean Millions in Costs

04.08.2016
Issues & Policies

Several health benefit mandates passed by the Connecticut legislature’s Insurance Committee should be sent to the Appropriations Committee for review because they carry a multi-million-dollar impact on the state budget.
New mandates not only would increase costs for the state—just as lawmakers struggle to make millions in budget cuts—the mandates also will hit smaller businesses in Connecticut.
One of the proposed mandates (HB 5230) is projected to cost the state millions, says the Office of Fiscal Analysis, with the others (including SB 36, SB 37,  HB 5233) totaling more than a million dollars in new costs to the state in 2018.
Here are two ways the state faces a budget impact from these mandates:

  1. Impact on the state employee health plans: Although the state is self-insured and not legally obligated to adopt new health benefit mandates passed into law, the state plan has traditionally adopted all new health benefit mandates. More mandates means more services to be covered, and therefore the state must pay more for its plan.
  2. Impact on the state’s health insurance exchange: All of the health insurance plans offered by the state’s exchange must include Essential Health Benefits, a package set by the state a few years ago. Any new benefits mandated by lawmakers will have to be paid for by the state for individuals receiving subsidies through the exchange.

Beyond the potential impact on the state budget, lawmakers also can’t overlook the cost of mandates on Connecticut’s small businesses.

Beyond the potential impact on the state budget, lawmakers also can’t overlook the cost of mandates on Connecticut’s small businesses—especially as they struggle to afford the rising cost of health insurance for their employees.
Despite the proposed mandates, state regulatory efforts are underway in an effort to address the cost challenge.
The State Innovation Model is currently meeting with the goal of introducing Value Based Insurance Design models and the Lt. Governor’s Healthcare Cabinet is undertaking a cost containment study.
With these initiatives underway now is not the time to require more costly healthcare services.


For more information, contact CBIA’s Jennifer Herz (860.970.4404) | @CBIAjherz

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