This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives.
STORAGE NAME: h1043a.HRS
DATE: 4/3/2023
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: CS/HB 1043 Medicaid Coverage of Rapid Whole Genome Sequencing
SPONSOR(S): Healthcare Regulation Subcommittee, Anderson
TIED BILLS: IDEN./SIM. BILLS: SB 616
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Healthcare Regulation Subcommittee 17 Y, 0 N, As CS Poche McElroy
2) Health Care Appropriations Subcommittee
3) Health & Human Services Committee
SUMMARY ANALYSIS
Genetic disorders are a leading contributor to morbidity and mortality in the neonatal and pediatric intensive
care units in the United States. Approximately 7 percent to 10 percent of the 4 million infants born in the U.S.
each year are admitted to a neonatal ICU for the diagnosis and treatment of an acute illness. About one
percent of all neonatal ICU admissions have an indication of a genetic disorder, and approximately 15 percent
of babies admitted to high acuity units appear to have a genetic disorder.
All organisms have a unique genetic code, or genome, comprised of nucleotide bases. If the sequence of the
bases in an organism are known, its unique DNA fingerprint is known. Determining the order of bases is called
sequencing. Whole genome sequencing is a laboratory procedure that determines the order of bases in the
genome of an organism in one process. Rapid whole genome sequencing (rWGS) completes such sequencing
quickly, and can produce a much quicker diagnosis.
CS/HB 1043 requires the state Medicaid program to cover rWGS as a fee-for-service benefit for Medicaid
recipients who:
Are 20 years of age or younger;
Have a complex or acute illness of unknown etiology that has not been caused by environmental
exposure, toxic ingestion, an infection with normal response to treatment, or trauma; and
Are receiving inpatient treatment in a hospital ICU or high-acuity pediatric care unit.
The bill restricts the use of any genetic data resulting from rWGS only to assist in diagnosing and treating the
patient, and considers such data protected health information under the Health Insurance Portability and
Accountability Act. The bill permits genetic data generated by rWGS to be used in scientific research only if the
patient, or the patient’s guardian if he or she is a minor, expressly consents to such use. Such consent may be
rescinded at any time.
The bill has a significant, negative fiscal impact on state government and no fiscal impact on local government.
The bill provides an effective date of July 1, 2023. STORAGE NAME: h1043a.HRS PAGE: 2
DATE: 4/3/2023
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Background
Genetic Disorders
Genetic disorders are a leading contributor to morbidity and mortality in the neonatal and pediatric
intensive care units in the United States. There are more than 13,000 known genetic diseases and
hundreds of targeted treatments and orphan drugs that have been approved or are in clinical trials.
1
Approximately 7 percent to 10 percent of the 4 million infants born in the U.S. each year are admitted to
a neonatal ICU for the diagnosis and treatment of an acute illness.
2
About 1 percent of all neonatal ICU
admissions have an indication of a genetic disorder, and approximately 15 percent of babies admitted
to high acuity units appear to have a genetic disorder, leading to longer hospitalizations and higher
resource use.
3
Disease can progress rapidly in acutely ill infants, necessitating timely diagnosis in the
hope of implementing personalized interventions that can decrease morbidity and mortality.
4
Rapid Whole Genome Sequencing (rWGS)
All organisms have a unique genetic code, or genome, comprised of nucleotide bases (A, T, C, and G).
If the sequence of the bases in an organism are known, its unique DNA fingerprint is known.
Determining the order of bases is called sequencing. Whole genome sequencing is a laboratory
procedure that determines the order of bases in the genome of an organism in one process.
5
Scientists conduct whole genome sequencing by following these four main steps:
DNA shearing: Scientists begin by using molecular scissors to cut the DNA, which is composed
of millions of bases (A’s, C’s, T’s and G’s), into pieces that are small enough for the sequencing
machine to read.
DNA bar coding: Scientists add small pieces of DNA tags, or bar codes, to identify which piece
of sheared DNA belongs to which bacteria. This is similar to how a bar code identifies a product
at a grocery store.
DNA sequencing: The bar-coded DNA from multiple bacteria is combined and put in a DNA
sequencer. The sequencer identifies the A’s, C’s, T’s, and G’s, or bases, that make up each
bacterial sequence. The sequencer uses the bar code to keep track of which bases belong to
which bacteria.
Data analysis: Scientists use computer analysis tools to compare sequences from multiple
bacteria and identify differences. The number of differences can tell the scientists how closely
related the bacteria are, and how likely it is that they are part of the same outbreak.
1
S Kingsmore, L Smith, A genome sequencing system for universal newborn screening, diagnosis, and precision medicine for sever
genetic diseases, Amer. J Human Genetics, vol. 109, pgs. 1605-1619, Sept. 1, 2022; M Clark, A Hildreth, Diagnosis of genetic diseases
in seriously ill children by rapid whole-genome sequencing and automated phenotyping and interpretation, Sci. Transl. Med., vol. 11,
2019.
2
D Dimmock, S. Caylor, et al., Project Baby Bear: Rapid precision care incorporating rWGS in 5 California children’s hospitals
demonstrates improved clinical outcomes and reduced costs of care, Amer. J. Human Genetics, vol. 108, pgs. 1-8, July 1, 2021,
available at https://pubmed.ncbi.nlm.nih.gov/34089648/.
3
Id.
4
B Peterson, EJ Hernandez, Automated prioritization of sick newborns for whole genome sequencing using clinical natural language
processing and machine learning, Genome Medicine, vol. 15:18, 2023.
5
Centers for Disease Control and Prevention, Whole Genome Sequencing, available at
https://www.cdc.gov/pulsenet/pathogens/wgs.html#:~:text=Whole%20genome%20sequencing%20is%20a%20fast%20and%20affordab
le,needed%20to%20quickly%20solve%20and%20prevent%20foodborne%20outbreaks (last viewed on March 30, 2023). STORAGE NAME: h1043a.HRS PAGE: 3
DATE: 4/3/2023
rWGS can complete such sequencing quickly and produce a much quicker diagnosis in as many as
50% of children.
6
With a turnaround as fast as 48 hours, vital time can be gained to develop and
implement a plan of care for individuals, mostly children, with genetic disorders.
As the use of whole genome sequencing expands, CDC’s national surveillance systems and laboratory
infrastructure must keep pace with the changing technology. With modernization, CDC and its public
health partners can continue to successfully detect, respond to, and stop infectious diseases.
Project Baby Manatee
From August 2019 to June 2020, Nicklaus Children’s Hospital implemented a pilot program called
Project Baby Manatee. Through the program, 50 patients were enrolled and sequenced using rWGS.
7
The average age was 34.6 months and two thirds were male, while 60 percent of participants were
white, and 26 percent were African American.
8
Two types of testing was completed – rWGS and ultra
rWGS. Ultra WGS testing was selected when delivery of the genetic diagnoses was critical for clinical
management. Twenty out of fifty patients, or 40 percent, received genetic diagnoses based of WGS.
9
The most common presentations of illness in which a genetic disease was diagnosed by rWGS were
respiratory problems (36 percent), cardiovascular problems (36 percent), seizures (32 percent), brain
disorders (32 percent), and metabolic issues (24 percent).
10
Eight of the diagnosed genetic diseases have an incidence of less than one in one million births or is of
unknown incidence. Some of the identified diseases are so rare that many treating physicians had
never seen them before, increasing the probability that these disorders would generally go
underdiagnosed without rWGS. The rWGS led to changes in clinical management of 38 percent of
children in the pilot program. Such results empowered clinicians and parents to quickly make informed
decisions that typically altered the course of the child’s hospitalization and led to the initiation of new
procedures and medications, or the avoidance of unnecessary ones.
11
The program resulted in
estimated savings of over $3.76 million, yielding a $2.88 million return on investment.
12
Based on the
results of Project Baby Manatee, rWGS and related rapid precision medicine approach was cost-saving
and cost-effective, but also improved health outcomes and shortened the period to diagnosis.
13
Other Studies
Studies performed in clinical research settings have found genome sequencing to be effective for
diagnosis and management of undiagnosed infants in ICUs and to result in improved diagnostic yield
14
,
faster time to diagnosis, enhanced physician and parental satisfaction, improved patient outcomes, and
reductions in health care costs.
15
Further, rWGS facilitates end-of-life care decisions that can alleviate
suffering and aid the grieving process.
16
Studies have shown rWGS provides a diagnosis for 21 percent
to 57 percent of children in intensive care settings.
17
6
University of California San Francisco, News and Events, Rapid Whole Genome Sequencing: Faster Diagnostics for Fragile Infants,
May 14, 2020, available at https://precisionmedicine.ucsf.edu/news/rapid-whole-genome-sequencing-faster-diagnostics-fragile-infants
(last viewed on March 30, 2023).
7
Nicklaus Children’s Hospital, Project Baby Manatee – Advanced Genomics for Critically Ill Children Final Report, Aug. 1, 2019 to June
30, 2020, available at https://www.nicklauschildrens.org/NCH/media/docs/pdf/research/Final-report-State-Appropriations-NCH-
PMI.PDF.
8
Id., at pg. 6.
9
Id., at pg. 7.
10
Id., at pg. 8.
11
Id.
12
Id., at pg. 19. Total costs for WGS and related rapid precision medicine for 50 patients was approximately $880,000.
13
Id., at pg. 20.
14
V Diaby, A Babcock, et al., Real-world economic evaluation of prospective rapid whole-genome sequencing compared to a matched
retrospective cohort of critically ill pediatric patients in the United States, Pharmacogenomics J., vol. 22, pgs. 223-229, 2022.
15
C Bupp, E Ames, et al., Breaking Barriers to Rapid Whole Genome Sequencing in Pediatrics: Michigan’s Project Baby Deer,
Children, vol. 10, pg. 106, 2023, available at https://doi.org/10.3390/children10010106; TA Lavelle, X Feng, et al., Cost-effectiveness of
exome and genome sequencing for children with rare and undiagnosed conditions, Genet. Med., vol. 24, pgs.1349-1361, 2022.
16
L Farnaes, A Hildreth, et al., Rapid whole-genome sequencing decreases infant morbidity and cost of hospitalization, npj Genomic
Medicine 3:10, 2018.
17
Id. STORAGE NAME: h1043a.HRS PAGE: 4
DATE: 4/3/2023
Despite evidence that sequencing improves clinical outcomes, reduce net costs of care, and leads to
high provider and parental satisfaction, routine implementation in ICUs and coverage by payors has
remained elusive.
18
It has been shown that WGS, while expensive, may decrease overall cost of
diagnostic evaluations of medically complex children.
19
Compared to traditional genetic tests, where diagnosis can be delayed or missed, rWGS has a high
diagnostic yield, ranging from 40 percent to 70 percent.
Infant Mortality
Infant mortality is the death of an infant before his or her first birthday. The infant mortality rate is the
number of infant deaths for every 1,000 live births. In 2020, the infant mortality rate in the United States
was 5.4 deaths per 1,000 live births.
20
The following map shows infant mortality by state for 2020, the most recent year with available data.
Florida’s infant mortality rate is 4.96 to less than 6.62 per 1,000 live births.
21
The 10 leading causes of infant death in 2020 (congenital malformations, low birth weight, sudden
infant death syndrome, unintentional injuries, maternal complications, cord and placental complications,
bacterial sepsis of newborn, respiratory distress of newborn, diseases of the circulatory system, and
neonatal hemorrhage) accounted for 67.5% of all infant deaths in the United States. The graph below
18
Supra, FN at pg. 2.
19
Supra, FN 5 at pg. 2; R Hayeems, et al., Care and cost consequences of pediatric whole genome sequencing compared to
chromosome microarray, Eur. J. Hum. Genet., vol. 25, pgs. 1303-1312, 2017.
20
U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Health Statistics,
Publication and Information Products–Data Briefs, Mortality in the United States, 2020, available at
https://www.cdc.gov/nchs/products/databriefs/db427.htm#section_5 (last viewed on March 29, 2023).
21
U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, Reproductive Health, Maternal and
Infant Health, Infant Mortality Rates by State, 2020, available at
https://www.cdc.gov/reproductivehealth/maternalinfanthealth/infantmortality.htm (last viewed on March 29, 2023). STORAGE NAME: h1043a.HRS PAGE: 5
DATE: 4/3/2023
shows the IMR for the 10 leading causes of infant death in 2020 in the United States, including 2019 for
comparison.
22
The chart below shows the leading cause of death of infants in Florida for 2021, with 2020 rates
included for comparison.
23
22
Supra, FN 1, figure 5.
23
Florida Department of Health, Bureau of Community Health Assessment, Division of Public Health Statistics and Performance
Management, Mortality Dashboard–Deaths by Age, Leading Causes of Death per 100,000 Population, Florida, 2020 and 2021, Under
Age 1, available at
https://www.flhealthcharts.gov/ChartsReports/rdPage.aspx?rdReport=MortalityAtlas.Dashboard_MortalityAtlas1&rdRequestForwarding
=Form (last viewed on March 29, 2023). STORAGE NAME: h1043a.HRS PAGE: 6
DATE: 4/3/2023
Florida Medicaid
Medicaid is the health care safety net for low-income Floridians. Medicaid is a partnership of the federal
and state governments established to provide coverage for health services for eligible persons. The
program is administered by the Agency for Health Care Administration (AHCA) and financed by federal
and state funds.
The structure of each state’s Medicaid program varies, but what states must pay for is largely
determined by the federal government, as a condition of receiving federal funds.
24
The federal
government sets the minimum mandatory populations to be included in every program, and the
minimum mandatory benefits to be covered. These mandatory benefits include physician services,
hospital services, home health services, and family planning.
25
States can add benefits, with federal
approval. Florida has added many optional benefits.
26
The Florida Medicaid program covers approximately 5.7 million low-income individuals in Florida.
27
Medicaid is the largest single program in the state, representing more than 44 percent of the total Fiscal
Year 2022-2023 state budget.
28
Florida’s program is the 4th largest in the nation by enrollment and, for
FY 2020-2021, the program is the 4th largest in terms of expenditures.
29
Florida delivers medical assistance to most Medicaid recipients - approximately 78% - using a
comprehensive managed care model.
30
A minority of Medicaid recipients-mostly those enrolled in
limited benefit programs participate in the traditional fee-for-service model.
Payment for Genomic Testing
Florida’s Medicaid program pays for the following standard, non-rapid genomic sequencing procedures:
Fetal chromosomal aneuploidy genomic sequence analysis panel.
Fetal chromosomal microdeletion genomic sequence analysis.
Genomic sequencing procedures and other molecular multianalyte assays.
Genetic testing for severe inherited conditions.
31
Several states are currently implementing coverage policies for rWGS, including California
32
,
Minnesota
33
, Louisiana
34
, Maryland
35
, and Oregon
36
.
24
Title 42 U.S.C. §§ 1396-1396w-5; Title 42 C.F.R. Part 430-456 (§§ 430.0-456.725).
25
S. 409.905, F.S.
26
S. 409.906, F.S.
27
Agency for Health Care Administration, Florida Statewide Medicaid Monthly Enrollment Report, Feb. 2023, available at
https://ahca.myflorida.com/medicaid/Finance/data_analytics/enrollment_report/index.shtml (last viewed on March 28, 2023). United
States Census Bureau, QuickFacts, Florida, https://www.census.gov/quickfacts/fact/table/FL/PST045221 (last viewed on March 28,
2023).
28
Ch. 2022-156, L.O.F. See also Fiscal Analysis in Brief: 2022 Legislative Session, available at
http://edr.state.fl.us/content/revenues/reports/fiscal-analysis-in-brief/FiscalAnalysisinBrief2022.pdf (last viewed on March 28, 2023).
29
The Henry J. Kaiser Family Foundation, State Health Facts, Total Medicaid Spending FY 2021 and Total Monthly Medicaid and CHIP
Enrollment Nov. 2022, available at http://kff.org/statedata/ (last viewed on March 28, 2023).
30
S. 409.964, F.S.
31
Agency for Health Care Administration, 2023 Agency Legislative Administration–HB 1043, pg. 2, March 7, 2023.
32
Medi-Cal Update, Inpatient Services, Bulletin 573, June 2022, available at https://files.medi-cal.ca-
gov/pubsdoco/bulletins/artfull/ips202206.aspx.
33
Minnesota Department of Human Services, Laboratory and Pathology Tests, April 4, 2022, available at
https://www.dhs.state.mn.us/main/idcplg?IdcService=GET_DYNAMIC_CONVERSION&RevisionSelectionMethod=LatestReleased&dD
ocName=DHS16_144353 .
34
Louisiana SB 154, Provides for Health Insurance Coverage of Genetic Testing for Critically Ill Infants with No Diagnosis, January 1,
2023, available at https://legisscan.com/LA/text/SB154/2022.
35
Maryland Department of Health, Whole Genome Sequencing (WGS) Clinical Criteria, Whole Genome Clinical Criteria, available at
https://health.maryland.gov/mmcp/Documents/Whole%20Genome%20Clinical%20Criteria.pdf#search=Whole%20Genome%20Sequen
cing%20Clinical%20Criteria.
36
Oregon Health Authority, Prioritized list of Health Services, January 1, 2023, available at https://www.oregon.gov/oha/HPA/DSI-
HERC/PrioritizedList/1-1-2022PrioritizedListofHealthServices.pdf. STORAGE NAME: h1043a.HRS PAGE: 7
DATE: 4/3/2023
Over the past decade, rWGS has developed into an effective diagnostic test for almost all heritable
diseases and is gaining acceptance as a first-tier test for critically ill newborns with suspected genetic
diseases.
37
There has been an increase in payor coverage for rWGS, but it varies and is not universal.
Effect of Proposed Changes
CS/HB 1043 requires AHCA to cover rWGS as a fee-for-service benefit for Medicaid recipients who:
Are 20 years of age or younger;
Have a complex or acute illness of unknown etiology that has not been caused by
environmental exposure, toxic ingestion, an infection with normal response to treatment, or
trauma; and
Are receiving inpatient treatment in a hospital ICU or high-acuity pediatric care unit.
The bill, by providing Medicaid coverage to children, will identify those children with serious genetic
disorders in a timely manner, allowing those children to get treatment earlier in the disease process,
likely reducing long-term medical costs for treating those children over the course of their lives.
The bill also restricts the use of any genetic data resulting from rWGS only to assist in diagnosing and
treating the patient, and considers such data protected health information protected by the Health
Insurance Portability and Accountability Act (HIPAA). It is likely this information is protected by HIPAA
without this bill provision.
The bill permits genetic data generated by rWGS to be used in scientific research only if the patient, or
the patient’s guardian if he or she is a minor, expressly consents to such use. Such consent may be
rescinded at any time. Upon receipt of written notice of consent rescission, the health care provider or
entity using the genetic data must cease using it, and expunge the individual’s genetic data from any
data repository where it is held.
Lastly, the bill authorizes AHCA to seek approval to amend waivers, request a new waiver, and amend
contracts as necessary to provide coverage of rWGS. AHCA is also given express rulemaking authority
to implement the bill provisions.
The bill provides an effective date of July 1, 2023.
B. SECTION DIRECTORY:
Section 1: Creates s. 409.9063, F.S., relating to rapid whole genome sequencing services for
Medicaid recipients.
Section 2: Provides an effective date of July 1, 2023.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
The bill has a significant, negative fiscal impact on the Medicaid program. In 2021, 14,476 newborn
babies covered by Medicaid were admitted to a NICU facility. If 5 percent of those newborns were
tested and testing was reimbursed as a fee-for-service benefit, 724 newborns would be tested. At a
37
Supra, FN 1. STORAGE NAME: h1043a.HRS PAGE: 8
DATE: 4/3/2023
cost of $4,549.31 per test, the total potential expense is $3,292,791, with potential impact to
General Revenue totaling $1,334,239. The chart below details potential expenses as the
percentage of newborns tested increases. This projection is based on the number of newborn
children in a NICU in 2021, and a reimbursement rate of 60% of the Medicare reimbursement rate
for rWGS ($7,582.20 x 60%=$4,549.31).
38
Participation Potential Participants Total Expense GR Impact
5% 724 $3,292,791 $1,334,239
10% 1,448 $6,585,581 $2,668,477
15% 2,171 $9,878,372 $4,002,716
25% 3,619 $16,463,953 $6,671,194
50% 7,238 $32,927,906 $13,342,387
75% 10,857 $49,391,859 $20,013,581
100% 14,476 $65,855,812 $26,684,775
AHCA will need to determine reimbursement rates for Medicaid coverage of rWGS and include
rWGS in the independent laboratory services fee schedule under Rule 59G-4.002, F.A.C. These
actions can likely be implemented using existing resources.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
Entities that perform rWGS testing may see an increase in the number of tests.
D. FISCAL COMMENTS:
rWGS testing may lead to significant cost avoidance over the lifetime of an individual through early
diagnosis and intervention before any disease conditions worsen. Such cost avoidance may offset the
initial cost of rWGS testing.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not applicable. The bill does not impact municipal or county government.
2. Other:
38
Agency for Health Care Administration, 2023 Agency Legislative Bill Analysis–HB 1043, March 7, 2023, pg. 5. STORAGE NAME: h1043a.HRS PAGE: 9
DATE: 4/3/2023
None.
B. RULE-MAKING AUTHORITY:
The bill expressly provides AHCA with rulemaking authority to implement the bill provisions.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES
On April 3, 2023, the Healthcare Regulation Subcommittee adopted two amendments and reported the bill
favorably as a committee substitute. The amendments:
Removed the whereas clauses from the bill.
Changed the age of eligibility for rWGS under Medicaid to 20 years of age and younger.
The bill was reported favorably as amended. The analysis is drafted to the amended bill as passed by the
Healthcare Regulation Subcommittee.