LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 7009 NOTE PREPARED: Jan 4, 2022
BILL NUMBER: HB 1254 BILL AMENDED:
SUBJECT: Newborn Screening Requirements.
FIRST AUTHOR: Rep. Barrett BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
XFEDERAL
Summary of Legislation: This bill authorizes the Perinatal Genetics and Genomics Advisory Committee
to recommend an additional disorder to the newborn screening examination requirements in a manner
prescribed by the State Department of Health (IDOH). The bill requires the addition of a disorder in this
manner to be affirmed annually by the committee. The bill requires the IDOH to post any additional disorders
to the newborn screening examination on the IDOH’s Internet web site. It removes the requirement that the
IDOH adopt rules to establish newborn screening fees and procedures for disbursement.
Effective Date: July 1, 2022.
Explanation of State Expenditures: Summary - Expenditures for newborn screening under the state
Medicaid and employee health plans would increase for each new disorder added to the mandatory newborn
screening list due to expected increases in the Newborn Screening Fee collected by the state’s newborn
screening lab. Increases in this fee amount would depend on the costs of screening for the new disorder.
When new disorders have been added to the newborn screening list in recent years, the fee collected by the
state’s laboratory increased by $5 per newborn for each disorder added. The state share of additional
Medicaid expenditures for each $5 increase in the Newborn Screening Fee is estimated at $53,700. However,
the fee could potentially increase by greater amounts for disorders that are more complex to screen for.
In addition to state health plan costs, infants born with disorders added to the list would receive follow-up
services paid from the Newborn Screening Fund. Any increase in expenditures from the Newborn Screening
Fund would depend on the disorders added and the number of infants affected.
The number or frequency of new disorders that may be added to the newborn screening list as a result of the
HB 1254 1 authority granted to the committee and the IDOH by the bill is unknown. Any additional workload required
by the IDOH as a result of this bill is expected to be minor. Additionally, the bill could alleviate some future
IDOH workload by eliminating the requirement for the IDOH to go through the rulemaking process to adjust
the newborn screening fee.
Additional Information -
Medicaid - Medicaid currently pays for approximately 39% of all Indiana births. There were approximately
81,000 live births in Indiana in 2019, the most recent year for which natality statistics are available.
Approximately 32,000 of these births were covered by Medicaid. Current statute requires that in addition
to payment due to hospitals for delivery of Medicaid-covered babies, the state Medicaid program is required
to reimburse hospitals’ costs equal to any fee assessed by the designated laboratory for newborn screening
and testing. The state share of Medicaid costs for most medical expenses is currently 34%. Therefore, each
$5 increase in newborn screening fees would result in additional Medicaid costs totaling approximately
$158,000, with a state share of $53,700 paid primarily from General Fund appropriations. The remainder
would be matched by federal Medicaid funds.
State Employee Health Plan - Costs for the state health plans are shared between the state and state
employees covered by the plan as determined in the plans’ designs, including premiums, coinsurance,
copayments, and deductibles. An increase in premiums cost may be mitigated with adjustments to other
benefits or to employee compensation packages, or through the division of premium costs between the state
and state employees.
Newborn Screening Fund - Follow-up services for infants testing positive for disorders on the newborn
screening list are paid for by the state’s portion of newborn screening laboratory fees, which are deposited
in the Newborn Screening Fund. In the current biennium, the newborn screening program has received
appropriations of about $2.7 M per year. However actual annual expenditures have averaged $1.5 M in
recent years.
Explanation of State Revenues: Newborn Screening Program - The newborn screening laboratory fee is
currently $120. The fee is collected by the designated newborn screening laboratory for each initial newborn
screen that is submitted to the laboratory. The state’s contract with the designated laboratory requires $30
of each fee to be remitted to the state and deposited into the Newborn Screening Fund. Annual collections
of the $30 fee have been around $2.3 M in recent years. Adding additional disorders to the Newborn
Screening Panel may require the IDOH to increase the fee amount the laboratory may collect and potentially
the amount remitted to the Newborn Screening Fund, depending on the extent to which additional infants
require follow-up services. The IDOH has statutory authority under IC 16-41-17-10 to annually review and
adjust the newborn screening fee based on projected costs, subject to review by the State Budget Agency.
Insurance Premium Tax: Increased newborn screening costs could result in upward pressure to private health
insurance premiums. If insurance companies increase premiums collected in the state, General Fund revenue
will increase from either insurance premium tax collections or Adjusted Gross Income (AGI) tax collections.
Revenue received from the AGI and insurance premium tax is deposited in the General Fund. Any additional
revenue is expected to be small.
Explanation of Local Expenditures: Local units of government that provide health insurance plans for
employees may see increases in cost or premiums as a result of increased laboratory fees.
HB 1254 2 Explanation of Local Revenues:
State Agencies Affected: Indiana Department of Health; Family and Social Services Administration, Office
of Medicaid Policy and Planning; State Personnel Department, Employee Health Plans.
Local Agencies Affected: Local units of government that provide health insurance plans for employees.
Information Sources: State Auditor’s System, Accts. 31910; ISDH, Indiana Natality Report, 2019; 410
IAC 3-3-13, Newborn Screening Rule; I.C. 12-15-15-6; IC 16-41-17.
Fiscal Analyst: Adam White, 317-234-1360.
HB 1254 3