Who Currently Pays for Elemental Formulas?

Right now, the majority of families who need to purchase this expensive formula do so out of pocket.  The second most common method of payment is state aid.  It is our goal that passage of this bill will help the private insurance companies step up to the plate and provide the services these families so desperately need.

The State of Utah Pays More than Private Insurance

57% No Coverage – these families have private insurance but no coverage and pay out-of-pocket, rely on assistance programs, or go without the prescribed treatment they need

19% State Coverage – these families rely on state programs such as Medicaid, WIC, and CHIP (some are forced to qualify to get the coverage they need)

12% Commercial Insurance Coverage – in some cases the state will help pay insurance premiums because it is cheaper for the state to help pay for private insurance than to pay 100% of the medical bills (i.e. Medicaid Buyout Program)

8% State & Commercial Insurance Coverage – some depend on partial coverage through state programs because their private insurance doesn’t provide the full coverage that they need

4% Commercial Insurance Partial Coverage – some are only provided partial coverage

What would formula coverage mean for everyone else?

One of the biggest questions that comes with changes to health care is 'what will this cost everyone else.'  As in, will my premiums go up even if someone in my family doesn't need the formula?  It is estimated the average family will notice no difference due to the passage of this law.

Of the 40,238 infants and children on WIC in Utah during December 2010, only 308 (0.76%) used elemental formula because so few require it. This provides some re-assurance that premiums will not raise.

Private insurance coverage will save the state money (ie, tax dollars) by moving those who have it off of state aid (Medicaid, WIC, and CHIP).  Since state aid will cover the formulas, some families opt to go underemployed for their abilities just to get coverage.  Given the chance, most of these families would gladly move to private insurance.

Thirteen states now mandate coverage for amino acid based elemental formulas. These states have recognized the importance of a patient’s existence while also recognizing that the cost to the state is virtually nothing.

Example of Fiscal Impact from Recent Similar Legislation

MAINE – legislation covers multiple disorders and diseases, with “additional costs are expected to be minor and can be absorbed within the existing budgeted resources.”

TEXAS – legislation covers multiple disorders and diseases, with “no significant fiscal implications to the State are anticipated.”

MARYLAND – legislation covers multiple disorders and diseases, with “minimal impact to the state. No impact to small business.”

OREGON – legislation covers multiple disorders and diseases, with “No Expenditure Impact on the state or local governments.”

MINNESOTA – came to an agreement, without the need for a mandate, to cover amino acid formula for multiple diseases and disorders.

ARIZONA – no fiscal note prepared (passed in 2006)

Other States With Elemental Formula Coverage

We aren't blazing new territory here.  There are 13 other states that already have some sort of elemental formula coverage.  They are:

Arizona

Connecticut

Illinois

Maine

Maryland

Massachusetts

Minnesota

New Hampshire

New Jersey

New York

Oregon

Rhode Island

Texas

In addition, Utah is in good company with North Carolina and Wisconsin also looking at legislation at this time.