OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
HB-5400
AN ACT CONCERNING THE REGULATION OF INSURANCE IN
THE STATE.
As Amended by House "A" (LCO 6461)
House Calendar No.: 232
Primary Analyst: MP 5/4/22
Contributing Analyst(s): ME, CP, RJW
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 23 $ FY 24 $
Office of Health Strategy GF - Cost 300,000 None
Consumer Protection, Dept. GF - Cost 75,000 90,418
State Comptroller - Fringe
Benefits
1
GF - Cost 30,398 36,646
Note: GF=General Fund
Municipal Impact: None
Explanation
The bill makes various changes related to health insurance and
prescription drugs, and results in the fiscal impacts described by section
below.
Section 1 and 16 make changes related to disclosing the process for
step therapy overrides and the time permitted for an override request
to be granted for drugs treating certain conditions. These changes are
not anticipated to impact premiums for the state employee health plan
or municipal plans, as the override request process already exists.
Section 2 establishes a task force to study data collection efforts
regarding step therapy, which has no fiscal impact because PA 17-236
1
The fringe benefit costs for most state employees are budgeted centrally in accounts
administered by the Comptroller. The estimated active employee fringe benefit cost
associated with most personnel changes is 40.53% of payroll in FY 23. 2022HB-05400-R01-FN.DOCX Page 2 of 3
prohibits transportation allowances for task force members.
Sections 3-5 apply the state’s copay accumulator program
prohibition to high deductible health plans to the maximum extent
permitted by federal law, which results in no fiscal impact to the state
and municipalities.
Sections 6 and 7 extend the notification period that insureds must
notify insurers regarding the birth of a child, from 61 days to 91 days.
The bill specifies that claims during the extended period are not
prejudiced if notification or payment of premium is not provided, and
therefore there is no anticipated impact to premiums to the state
employee health plan, the Exchange, or municipal plans.
Sections 8-13 require the Department of Consumer Protection (DCP)
to establish a Canadian Legend Drug Importation Program (CLDIP)
resulting in costs of approximately $75,000 to DCP (salary) and $30,398
to OSC (fringe benefits) in FY 23, and $90,418 to DCP (salary) and
$36,646 to OSC (fringe benefits) in FY 24 and each fiscal year thereafter.
In FY 23 only, a six-month durational Project Manager is needed to
submit a request to the federal Secretary of Health and Human Services
for approval to establish the CLDIP. Assuming federal approval is
granted, a full-time Drug Control Agent will be needed to run the
program beginning in FY 24.
Section 14 requires the Office of Health Strategy (OHS) to prepare
and submit a report on pharmacy benefit manager distribution of
prescription drug practices regarding spread pricing arrangements,
manufacturing rebates and transparency and accountability. OHS will
need to hire a consultant, with a one-time cost estimated at $300,000 to
prepare this report as OHS staff does not have expertise in this area.
Section 15, which requires the State Comptroller to prepare and
submit a report, has no fiscal impact since the agency has enough
expertise within existing staff resources to conduct the study.
2022HB-05400-R01-FN.DOCX Page 3 of 3
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to inflation.
The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely
for the purposes of information, summarization and explanation and does not represent the intent of the General
Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of
informational sources, including the analyst’s professional knowledge. Whenever applicable, agency data is
consulted as part of the analysis, however final products do not necessarily reflect an assessment from any
specific department.