BILL ANALYSIS S.B. 604 By: Nelson, et al. (Berlanga, et al.) 04-27-95 Committee Report (Unamended) BACKGROUND The Texas Medicaid program has grown from a total budget of $7.5 billion in the 1990-91 biennium to an appropriation of $18.7 billion for the current 1994-95 biennium, including $6.8 billion in general revenue and $11.7 billion in federal funds. This growth is due to federal mandates regarding eligibility expansions, required services, and provider reimbursement rules. Lt. Gov. Bob Bullock charged the Senate Committee on Health and Human Services with the challenging task of developing recommendations for wholesale reform. In response the committee began an intensive investigation that included a public hearing May 31-June 1, 1994, and on-site visits to Medicaid managed care pilot projects in Texas, to a rural health clinic, and to a rehabilitation center. On November 29-30, 1994, the House Committees on Public Health and on Human Services joined the Senate committee in a second public hearing in which public testimony was taken. The Senate Committee on Health and Human Services then adopted the recommendations that are the basis of this legislation. PURPOSE S.B. 604, as engrossed, would create a pilot program for the establishment of medical savings accounts to assist Medicaid recipients. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. MEDICAID MEDICAL SAVINGS ACCOUNT PILOT PROGRAM. (a) Requires the Health and Human Services Commission (commission) to develop a pilot program (program) that uses Medicaid funds to establish medical savings accounts for recipients of acute care services under the state Medicaid program, not later than December 1, 1995. (b) Sets forth the goals of the program. (c) Authorizes the commission to examine each available medical savings account model to determine if the model can be used in this state. (d) Sets forth provisions the commission may provide in developing the pilot program. (e) Establishes the determinations regarding the program which the commission is required to make. (f) Requires the commission to implement the program not later than January 1, 1997. Authorizes the commission to choose not to implement the program under certain conditions. Sets forth the required contents and a list of persons who are to receive a report explaining why the program will not be implemented. SECTION 2. REPORT. Requires the commission to submit to the governor and the 76th Legislature a report concerning the effectiveness of the pilot program, not later than January 15, 1999. SECTION 3. WAIVERS. Requires the commission to request a waiver or authorization and to delay implementing those provisions until the waiver or authorization is granted, if the commission determines that a waiver or authorization from a federal agency is necessary for implementation. SECTION 4. EXPIRATION DATE. Provides that this Act expires September 1, 1999. SECTION 5. Emergency clause. Effective date: upon passage. SUMMARY OF COMMITTEE ACTION S.B. 604 was considered by the Public Health Committee in a formal meeting April 27, 1995. The bill was reported favorably without amendment, and with the recommendation that it do pass and be printed, by a record vote of 9 Ayes, 0 Nays, 0 PNV, and 0 Absent.