The fiscal implications of the bill cannot be determined due to uncertainty in the costs to implement the components of the Texas Pharmaceutical Initiative and potential savings related to the effects on prescription drug prices.
The governing board of the Texas Pharmaceutical Initiative is required to implement a provision of the bill only if the legislature appropriates money specifically for that purpose. If the legislature does not appropriate money specifically for that purpose, the board may, but is not required to, implement a provision of the bill using other appropriations available for that purpose.
The bill would establish the Texas Pharmaceutical Initiative (the initiative) to provide cost effective prescription drug access for employees, dependents, and retirees of public higher education systems and institutions, Employees Retirement System members, Teacher Retirement System members, persons confined by the Texas Department of Criminal Justice or the Texas Juvenile Justice Department, recipients of Medicaid, enrollees of the Children's Health Insurance Program, and other public, non-profit, and for-profit entities.
The bill would establish a governing board for the initiative (the board) that would be administratively attached to the Health and Human Services Commission (HHSC). The board would be required to develop and implement the initiative and related programs. It is assumed that there would be significant costs related to staffing and administrative support for the board, but the costs cannot be determined because there is not enough information available on the level of staffing and support that would be required by the board to implement the initiative.
The board would be required to implement a statewide transparent pharmacy benefit manager to provide cost-effective prescription drugs to entities and organizations served by the initiative; establish and implement a central service center and associated network of satellite distribution facilities to provide pharmacy and medical supplies; establish a pharmaceutical advanced preparation facility; and contract to provide advanced health care cost and claims analytic services. The board would be authorized to enter into an agreement to establish a facility providing for the manufacturing of generic drugs. It is assumed that there would be significant costs and potential fee revenue related to the statewide transparent pharmacy benefit manager, the central service center and satellite distribution facilities, the pharmaceutical advanced preparation facility, the analytic services, and the manufacturing of generic drugs, but the costs and revenue cannot be determined due to uncertainty in the scale of the program, related contracting costs, potential fees, and the timeline for implementation.
It is assumed that implementation of the bill could result in a savings to the state due to a decrease in the cost of prescription drugs for entities and organizations served by the initiative, but the potential savings cannot be determined due to the unavailability of data on how the implementation of the initiative would affect prescription drug prices.
The bill would establish the Texas Pharmaceutical Initiative Fund as a trust fund outside the treasury consisting of gifts, grants, donations, and other appropriations or designations from the legislature to be used to implement the initiative. The amount of funding required for the trust fund cannot be estimated.
This legislation would do one or more of the following: create or recreate a dedicated account in the General Revenue Fund, create or recreate a special or trust fund either in, with, or outside the Treasury, or create a dedicated revenue source. The fund, account, or revenue dedication included in this bill would be subject to funds consolidation review by the current Legislature.
The fiscal implications of the bill cannot be determined at this time.