Fiscal Note & Local Impact Statement
127 th General Assembly of Ohio
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STATE FUND |
FY 2008 |
FY 2009 |
FUTURE YEARS |
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General Revenue Fund |
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Revenues |
- 0 - |
- 0 - |
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|
Expenditures |
Potential minimal increase |
Potential minimal increase |
Potential minimal increase |
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Other State Funds |
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Revenues |
- 0 - |
- 0 - |
- 0 - |
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Expenditures |
Potential minimal increase |
Potential minimal increase |
Potential minimal increase |
Note: The state
fiscal year is July 1 through June 30.
For example, FY 2007 is July 1, 2006 – June 30, 2007.
·
The
required benefits are already provided to state employees covered by the Ohio
Med plan, and by the next two largest health plans that cover state
employees. The bill may require that
benefits be provided to participants in cancer clinical trials that are covered
under another health plan. If so, there
would be a minimal increase in expenditures to provide the benefits. Such increase may be paid from the GRF or
from some other state fund.
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LOCAL
GOVERNMENT |
FY 2008 |
FY 2009 |
FUTURE YEARS |
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Counties, municipalities,
and townships |
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Revenues |
- 0 - |
- 0 - |
- 0 - |
|
|
Expenditures |
Potential increase up to
$1.12 million |
Potential increase up to
$1.12 million |
Potential increase up to
$1.12 million |
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School districts |
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Revenues |
- 0 - |
- 0 - |
- 0 - |
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|
Expenditures |
Potential increase up to
$1.42 million |
Potential increase up to
$1.42 million |
Potential increase up to
$1.42 million |
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Note: For most local governments, the fiscal year is the calendar year. The school district fiscal year is July 1 through June 30.
·
Counties,
municipalities, townships, and school districts may incur expenses to provide
the required benefits to employees and their dependents. To the extent that the required benefits are
already provided to employees of political subdivisions, costs above would be
reduced.
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S.B. 186 would prohibit
sickness and accident insurance policies (both group and individual policies),
public employee benefit plans, and multiple employer welfare arrangements from
denying coverage for routine patient care of patients participating in an
eligible[1]
cancer clinical trial. It would also
require plans issued by health insuring corporations (HICs) to provide such
coverage as a basic health care service.
The bill defines routine patient care to be "all health care services
consistent with the coverage provided in the plan of health coverage or
arrangement for the treatment of cancer . . . that is
typically covered for a cancer patient who is not enrolled in a cancer clinical
trial, and that was not necessitated solely because of the trial."
Background
LSC staff contacted a number
of institutions in Ohio attempting to obtain an estimate of the number of
participants in cancer clinical trials in Ohio.[2] As of this writing we have been unable to
obtain such an estimate. However, the
local Partnership Program Coordinator of the National Cancer Institute's Cancer
Information Service reported that it is generally thought that between 3% and
5% of cancer patients nationwide participate in cancer clinical trials. According to a joint publication of the Ohio
Department of Health and the James Cancer Hospital and Solove Research
Institute, Cancer Incidence and Mortality Among Ohio Residents, 1999-2003,
an annual average of 55,813 new invasive cancer cases were diagnosed and reported
among Ohio residents during that period.
That implies that up to 2,791 new patients may enroll in a cancer
clinical trial in a given year.
Allowing for mortality of cancer patients, we have assumed that three
years' worth of new patients, or up to 8,372 patients, may be enrolled in
cancer clinical trials in Ohio.
Similarly, none of the
individuals contacted were yet able to offer an estimate of the cost of routine
patient care for a participant in a cancer clinical trial. Data from the Medical Expenditure Panel
Survey (MEPS) conducted by the Agency for Healthcare Research and Quality of
the U.S. Department of Health and Human Services indicate that 10,996,000
American cancer patients accounted for $48.43 billion in medical spending to
diagnose and treat cancer in 2003.
These data imply that, on average nationwide, just over $4,400 was spent
on diagnosing and treating cancer per patient that year. Medical inflation from 2003 to 2006 was
10.86% (total, not per year) as measured by the medical care component of the
price deflator for personal consumption expenditures. Allowing for medical inflation, we assume that the cost per
patient for routine patient care is $4,883 per year.
Fiscal effects
The bill imposes no duties
directly on state agencies or on local governments. Nevertheless, requiring HICs and public employee benefit plans to
cover certain medical services has the potential to increase costs to the state
and to local governments to provide health benefits to workers. This would occur if and when a covered
employee (or dependent) with cancer, who would have chosen to undergo a
clinical trial even if he or she had to pay for any routine care involved, had
that care paid for by their insurer due to the bill’s requirement. To the extent these benefits are not already
provided by HICs and public employee benefit plans, the bill would cause an
increase in costs. These potential
costs could be decreased if routine care is less expensive for patients who are
undergoing a clinical trial.
An official with the
Department of Administrative Services (DAS) reports that the required benefits
are covered by the state's self-funded Ohio Med plan, and have been for several
years. The state does not require HICs that
cover state workers (and their dependents) to offer these benefits, but United
Health Care and Aetna do cover them if the routine care is performed by a
network provider. The official reports
that DAS is unable currently to determine the amounts paid for such care under
Ohio Med due to the fact that they do not track whether workers or dependents
are participating in clinical trials when payment is made.
Assuming that there may be
up to 8,372 participants in cancer clinical trials statewide, and assuming that
the ages of these patients are distributed the same as the overall Ohio
population, then up to 7,260 participants may be under age 65. Allowing that 69% of Ohio adults have health
coverage through an employer, and assuming that these patients are distributed
across employers in the same proportion as the overall workforce, then up to 70
patients may be covered under a state of Ohio plan, up to 230 may be covered by
a plan sponsored by a county, municipality, or township, and up to 292 may be
covered by a school district.
Since the state's Ohio Med
plan and at least two HIC contracts covering state employees already cover the
required benefits, and since the estimate is that the state might be liable to
provide benefits for up to just 70 patients, it would appear that complying
with the bill would require the state to cover at most 10 or 20 new patients,
at a cost of up to $100,000.
For counties,
municipalities, and townships, LSC staff does not have information about the
extent to which employees already receive this benefit. We estimate that the cost to this group to
provide benefits to up to 230 patients may be up to $1.12 million per year
statewide. Similarly, LSC staff does
not have information about benefits for school district employees. We estimate that the cost to school districts
to provide benefits for up to 292 patients would be up to $1.42 million
per year statewide. However, to the
extent that the required benefits are already provided to employees of
political subdivisions, the cost of the bill may be reduced.
LSC fiscal staff: Ross Miller, Senior Economist
[1] To be an eligible cancer clinical trial, a clinical trial would have to be approved by the National Institutes of Health (or one of its cooperative groups or centers), the U.S. Food and Drug Administration, the U.S. Department of Defense, or the U.S. Department of Veterans' Affairs, and would have to satisfy other criteria specified in the bill.
[2] For example, we contacted both comprehensive cancer centers in Ohio, the James Cancer Hospital and Solove Research Institute at The Ohio State University and the University Hospitals Ireland Cancer Center (at Case Western Reserve University). According to a representative at the James, that center enrolls about 700 patients in cancer clinical trials in a typical year. A representative of the Ireland Cancer Center reports that they enroll about 500 to 600 patients in a cancer clinical trial each year.