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Committee sends measure to appropriations to raise Medicaid payments for vagus nerve stimulators after witnesses describe clinical and economic benefits
Summary
Senators advanced SB 121, which would increase Medicaid reimbursement to better cover the acquisition cost of VNS devices used for drug‑resistant epilepsy; sponsors and patients urged action, and an amendment reduced the fiscal note by aligning the change with federal review processes.
The Senate Health & Human Services Committee advanced SB 121 to the Appropriations Committee after testimony from clinicians, the VNS manufacturer and patients describing clinical benefit and downstream cost savings from vagus nerve stimulator (VNS) therapy for drug‑resistant epilepsy.
Sponsors said the current Medicaid prospective payment methodology (EAPG) does not reliably cover the acquisition cost of VNS devices and related implantation, creating access problems when hospitals decline to provide the device at current reimbursement levels. LivaNova, the device manufacturer, told the committee acquisition cost for the device averages about $49,000; paid amounts under state outpatient payment systems observed by staff ranged from about $16,000 to $33,000 depending on hospital systems.
Patients and clinicians described quality‑of‑life improvements following VNS implantation including reduced seizure frequency, improved cognition and social function, and reduced emergency care usage. Patient witnesses told the committee VNS allowed return to work or school, reductions in medication costs and fewer hospitalizations. LivaNova said other states using EAPG methodology adopted add‑on payments to cover acquisition costs for similar devices.
The Department of Health Care Policy and Financing said it opposes the bill as drafted because the payment approach in statute would require the department to pay a fixed share of a device’s acquisition cost and could expose the state to increased fiscal risk; the department recommended working with the contractor that maintains the prospective payment system (Solventum) and stakeholders to adjust rates. In response, sponsors offered an amendment (L2) designed to coordinate needed federal approvals and reduce the fiscal estimate. Sponsors said the amendment would substantially lower the fiscal note to about $270,000 total with $66,000 from the General Fund (per sponsors’ estimate shared on the floor).
After debate and adoption of the amendment, Senator Judah moved SB 121 to Appropriations. The committee recorded a vote; the motion passed 6–3 and the bill will be considered next by the Appropriations Committee.
