FISCAL NOTE
Date Requested: February 22, 2017
Time Requested: 11:55 AM |
| Agency: |
Health Care Authority, WV |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2496 |
Introduced |
|
|
|---|
| CBD Subject: |
Health |
|---|
|
FUND(S):
5377 (formerly 5376)
Sources of Revenue:
Special Fund
Legislation creates:
Neither Program nor Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
This legislation will not have a fiscal impact on the HCA budget, however, other agencies will be impacted.
State general revenue for State payors such as PEIA and Medicaid would be significantly impacted. An actuarial report issued in 2009 by CCRC Actuaries, LLC (the actuaries who have served the Public Employee Insurance Agency and the Children’s Health Insurance Program), stated that without CON, health care costs to the State of West Virginia would have increased by $21 million from 2005 to 2008 through increases in PEIA, WVCHIP and the Medicaid State share.
This proposed legislation, while not an outright repeal of CON law, will allow physicians to offer health services and major medical equipment without CON review. Physicians are exempt from CON review when they are acting as a private office practice and are owned and controlled by physicians. However, currently certain services when offered by a physician or a hospital are reviewable such as high cost imaging such as MRI, PET and MRT scanning. This law would allow this equipment to be purchased by physicians without CON review. Studies have shown that costs increase after physicians purchase imaging equipment because utilization increases.
Source: Baker, Laurence, C., Acquisition of MRI Equipment by Doctors Drives up Imaging Use and Spending., Health Aff., December 2010. Vol. 29, No. 12, 2252-2259.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2017
Increase/Decrease
(use"-") |
2018
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| 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):
This will not have a fiscal impact on the HCA budget.
Memorandum
State general revenue for State payors such as PEIA and Medicaid would be significantly impacted. An actuarial report issued in 2009 by CCRC Actuaries, LLC (the actuaries who have served the Public Employee Insurance Agency and the Children’s Health Insurance Program), stated that without CON, health care costs to the State of West Virginia would have increased by $21 million from 2005 to 2008 through increases in PEIA, WVCHIP and the Medicaid State share.
This proposed legislation, while not an outright repeal of CON law, will allow physicians to offer health services and major medical equipment without CON review. Physicians are exempt from CON review when they are acting as a private office practice and are owned and controlled by physicians. However, currently certain services when offered by a physician or a hospital are reviewable such as high cost imaging such as MRI, PET and MRT scanning. This law would allow this equipment to be purchased by physicians without CON review. Studies have shown that costs increase after physicians purchase imaging equipment because utilization increases.
Source: Baker, Laurence, C., Acquisition of MRI Equipment by Doctors Drives up Imaging Use and Spending., Health Aff., December 2010. Vol. 29, No. 12, 2252-2259.
Person submitting Fiscal Note: Kristi Pritt
Email Address: kpritt@hcawv.org