SB 435 - HB 484
FISCAL NOTE
Fiscal Review Committee
Tennessee General Assembly
March 1, 2025
Fiscal Analyst: Chris Higgins | Email: chris.higgins@capitol.tn.gov | Phone: 615-741-2564
SB 435 - HB 484
SUMMARY OF BILL: Requires a health insurer that issues, amends, delivers, or renews a
contract or agreement for a health benefit plan to take effect on or after January 1, 2026, including a
TennCare health benefit plan, to include coverage for biomarker testing.
Requires a health benefit plan to provide coverage for biomarker testing for the purposes of
diagnosis, treatment, appropriate management, or ongoing monitoring of an enrollee's disease or
condition when the test is supported by medical and scientific evidence.
FISCAL IMPACT:
STATE GOVERNMENT
EXPENDITURES General Fund
FY25-26 $1,465,700
FY26-27 & Subsequent Years $2,931,500
OTHER FISCAL IMPACT
Increased biomarker testing utilization under the Division of TennCare and the State Group
Insurance Program could result in increased expenditures for such additional services; however,
the precise amounts of such increases attributable to the proposed legislation cannot be quantified
with reasonable certainty.
Potential Impact on Health Insurance Premiums (required by Tenn. Code Ann. § 3-2-111): Such
legislation will result in an increase in the cost of health insurance premiums for procedures and
treatments being provided by plans that do not currently offer these benefits at the proposed
mandated levels. It is estimated that the increase to each individual’s total premium will be less than
one percent.
Assumptions:
• Biomarker testing is currently not broadly covered under the state’s benchmark health plan.
• The proposed legislation will be considered an additional coverage mandate to the essential
health benefits (EHB) of the qualified health plans (QHPs) offered on and off the
Marketplace Exchange.
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• The state will be required to defray the cost of benefits to commercial insurers because they
exceed those provided under Tennessee’s EHB benchmark plan.
• As of January 2025, the Centers for Medicare and Medicaid Services (CMS) showed a total
population of 624,867 covered lives on QHPs in Tennessee.
• According to estimates from multiple QHP providers, the increase in costs per member per
month as a result from the proposed legislation will be approximately $0.34. This would
result in an increase in state expenditures of $2,931,474 ($0.38 x 12 x 642,867) annually in
order for DCI to defray the costs of this increase.
• Due to the January 1, 2026 effective date, the total increase in expenditures is estimated to
be $1,465,737 ($2,931,473 x 50%) in FY25-26.
• The legislation does not mandate biomarker testing for screening purposes.
• The proposed language does not prohibit the use of prior authorizations or determinations
of medical necessity for coverage of biomarker testing.
• Biomarker testing that is determined to be medically necessary is currently covered by
health benefit plans under the Division of TennCare (Division).
• The field of biomarker testing is rapidly developing, and with new tests frequently being
approved the clinical utilization of biomarker testing has naturally increased in recent years.
• According to information provided by the Division, between 2021 and 2023 the average
reimbursement for biomarker testing was $272 per test.
• It is unknown to what extent the proposed legislation will contribute to additional
biomarker testing in the TennCare program or the CoverKids program as biomarker testing
utilization continues to increase overall.
• Based on the experiences in other states who have enacted similar legislation, including
Oklahoma, Minnesota, and California, it is assumed that coverage for biomarker testing
through these programs will continue to be subject to medical necessity determinations, and
that any increase in testing coverage in the Division's programs as a result of the proposed
legislation will be minimal.
• Biomarker testing can also result in significant cost-savings by avoiding unnecessary or
ineffective treatment and limiting the effects of disease progression.
• The health plans administered through the State Group Insurance Program (SGIP)
currently include coverage of certain biomarker testing when medically necessary.
• According to the Division of Benefits Administration, the average cost for biomarker
testing under the SGIP is $590.69 per test.
• While the proposed legislation allows utilization reviews of biomarker testing, including
prior authorization, increased utilization of biomarker testing under the SGIP could
potentially lead to an increase in plan premiums.
• Increased biomarker testing utilization under the Division and the SGIP could result in
increased expenditures for additional services; however, the precise amounts of such
increases attributable to the proposed legislation cannot be quantified with reasonable
certainty.
• Potential Impact on Health Insurance Premiums (required by Tenn. Code Ann. § 3-2- 111):
Such legislation will result in an increase in the cost of health insurance premiums for
procedures and treatments being provided by plans that do not currently offer these
benefits at the proposed mandated levels. It is estimated that the increase to each
individual’s total premium will be less than one percent.
SB 435 - HB 484 3
IMPACT TO COMMERCE:
BUSINESS IMPACT
FISCAL YEAR REVENUE EXPENSES
FY25-26 $1,465,700 < $1,465,700
FY26-27 & Subsequent Years $2,931,500 < $2,931,500
Assumptions:
• Healthcare providers and laboratories will experience an increase in business revenue of
$1,465,737 in FY25-26 and $2,931,474 in FY26-27 and subsequent years from performing
biomarker testing for patients.
• For businesses to remain solvent, any increase in expenditures will be less than such
amounts of revenue.
• Any impact to jobs in Tennessee is estimated to be not significant.
CERTIFICATION:
The information contained herein is true and correct to the best of my knowledge.
Bojan Savic, Executive Director