LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
74th Regular Session
April 30, 1995
TO: Honorable Hugo Berlanga, Chair IN RE: Committee Substitute
Committee on Public Health for Senate
House of Representatives Bill No. 602
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on Senate Bill No.
602 (relating to the development and implementation of a computer
database to reduce fraud and abuse in the Medicaid program) this
office has determined the following:
The bill would make no appropriation but could provide the legal
basis for an appropriation of funds to implement the provisions
of the bill.
The bill would require the Health and Human Services Commission
and each health and human services agency administering a
component of the Medicaid Program to jointly develop a system:
1) to coordinate and integrate state Medicaid databases;
2) to facilitate the comprehensive analysis of Medicaid
data; and
3) to detect fraud perpetrated by a program provider or
client.
The Health and Human Service Commission is to coordinate efforts
of those agencies involved in the system development and any
other agencies involved in health related computer database
activities to minimize costs and duplication of efforts.
The fiscal implications related to the Commission correspond to
integrating information between the operating agencies. All
costs would be contracted services in fiscal year 1996
($257,012). There would be no increase in FTEs at the
Commission. It is anticipated that staff would be borrowed from
the operating agencies during the requirements definition and
system development phases. Costs associated with these
activities would be paid with both federal funds and general
revenue (50:50).
The fiscal implications for the Department of Health include
three administrative positions ($121,461) and equipment costs of
$200,000 for the first year and $35.000 for each of the
succeeding years for software and related items.
The fiscal implications for the Department of Human Services
assume that the agency would be able to develop the means for
HHSC's integrated database network to access a decision support
services application that would download DHS' Medicaid
eligibility and long term care data into an environment that
would facilitate the analysis of this information. Additional
costs related to the any increased usage of DHS' data network
cannot be estimated at this time due to unknown usage in the
future. Costs for DHS only correspond to fiscal year 1996 and
relate to equipment ($50,000) and development costs ($500,000).
The bill would also require that the database system provide
analysis of the use of prescription medications including
information on Medicaid clients for whom more than three
medications have been prescribed. The fiscal implications
regarding this provision of the bill cannot be determined.
The system would be completed by the end of fiscal year 1996.
Savings identified from accessing the information to determine
fraudulent activities by providers or clients cannot be estimated
at this time.
The probable fiscal implication of implementing the provisions of
the bill during each of the first five years following passage
is estimated as follows:
Fiscal Probable Cost Out Probable Cost Out Change in
Year of General of Federal Funds Number of State
Revenue Fund 001 555 Employees from
FY 1995
1996 $589,236 $539,237 3.0
1997 78,230 78,231 3.0
1998 78,230 78,231 3.0
1999 78,230 78,231 3.0
2000 78,230 78,231 3.0
Similar annual fiscal implications would continue as long as the
provisions of the bill are in effect.
No fiscal implication to units of local government is
anticipated.
Source: Legislative Budget Board, Health and Human Services
Commission,
Department of Health, Department of
Human Services
LBB Staff: JK, AZ, DF