BILL #    SB 1347	TITLE: health insurance; fertility preservation; coverage
SPONSOR:    Werner
PREPARED BY:    Chandler Coiner	STATUS:   As Amended by Senate FIN

REVISED

Explanation of Revision

Our fiscal note published on 2/19 assumed a $4.7 million General Fund impact based on procedures for 630 state employees and their dependents. Based on our review of additional federal data concerning cancer diagnoses in Arizona, we believe our initial estimates of the number of procedures were likely overstated. As a result, we have revised our analysis to lower the number of estimated procedures to 41, reducing the fiscal impact estimate to $305,900.

Description

The bill would require a health plan, beginning in Plan Year (PY) 2027, to cover standard fertility preservation services to a member who is within reproductive age, diagnosed with cancer, and whose medically necessary treatment is likely to directly or indirectly cause infertility.

Estimated Impact

We estimate that the bill would result in a General Fund cost of $305,900 and a Total Funds cost of $611,800 annually for the state employee health plan beginning in PY 2027. The cost would be halved in FY 2027 due to only covering 6 months of the plan year. We also estimate this bill would have a fiscal impact on local government health plans and health care premium tax collections, but the magnitude of such impacts cannot be determined in advance. The bill does not affect the Arizona Health Care Cost Containment System (AHCCCS).

We have asked the Arizona Department of Administration (ADOA) for its estimate of the bill's fiscal impact, but we have not yet received a response.   

Analysis

Our estimate assumes the following:

1) Fertility preservation services cost an average of $15,000 per individual. This is based on a fiscal note on a similar bill introduced in the Virginia General Assembly this year. We believe this assumption is reasonable based on other publicly available estimates.

2) Nationwide, there were 97,575 new cancer diagnoses among individuals between the ages of 15-39 in 2022, according to the federal Centers for Disease Control and Prevention (CDC). We assume that individuals recently diagnosed with cancer within this age range would be the most likely to utilize fertility preservation services.

3) The population of Arizona is 7.6 million, or 2.2% of the U.S. population.

4) There are approximately 142,000 individuals enrolled in the state employee health plan, or 1.9% of the Arizona population.

5) Based on the above assumptions, we estimate the bill would generate $611,800 in costs for the Arizona state employee health plan ($15,000 × 97,575 × 2.2% × 1.9%). This would cover an estimated 41 procedures per year.

6) Because the General Fund pays approximately 50% of the employer share of all state employee health care costs, we assume the General Fund would also cover 50%, or $305,900, of these costs as well.

7) ADOA may be able to provide more precise information on the number of procedures that would be covered by the state plan under this bill.

8) We are unable to estimate the impact to local government and commercial health plans and associated insurance premium tax impacts, as we lack data on the extent to which fertility preservation services are covered by such plans. 

2/26/26