LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session April 7, 1997 TO: Honorable Harvey Hilderbran, Chair IN RE: House Bill No. 2409 Committee on Human Services By: Coleman House Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB2409 ( Relating to creating a licensing program for adult foster care homes; providing criminal penalties.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB2409-As Introduced Implementing the provisions of the bill would result in a net negative impact of $(232,561) to General Revenue Related Funds through the biennium ending August 31, 1999. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. Fiscal Analysis The bill would create a new state licensing program for adult foster care homes. It would require licensure for any establishment that: 1) provides room and board for a person age 65 or older who is unrelated to the proprietor, 2) receives Medicaid reimbursement, and 3) is not otherwise required to be licensed. The bill would require the Board of Human Services to adopt rules prescribing minimum standards for the health and safety of adult foster care home residents. The rules must include requirements for criminal history checks; the reporting of abuse, neglect, mistreatment, or exploitation of residents; employee training; and employee continuing education. The bill would require the Department of Human Services (DHS) to issue an adult foster care home license when it finds, after an inspection and investigation, that the minimum standards have been met. The license would be valid for two years and could be renewed. The Board of Human Services could establish a non-refundable license fee, and DHS could also set fees sufficient to cover the costs of administering the licensing statute. The bill would authorize DHS, with assistance from the Texas Department on Aging, to: 1) inspect adult foster care homes as necessary to assure compliance, 2) provide adult foster care home operators with training materials and a handbook explaining the rules, and 3) coordinate training conferences and workshops with other state agencies. The bill would authorize DHS to deny, suspend, or revoke an adult foster care home's license after providing notice and the opportunity for a hearing and appeals under Chapter 2001 of the Government Code. It would require DHS to suspend an adult foster care home's license, or order immediate closure, when there is an immediate threat to resident health and safety. It would also require DHS by rule to provide for the relocation of residents when a license is suspended or a home is closed. The bill would require persons to report abuse or neglect of adult foster care home residents who are at least 65 years old. The report could be filed with DHS or a local or state law enforcement agency. Law enforcement agencies would be required to refer their reports to DHS or another designated agency. It would be a Class A misdemeanor to fail to report abuse and neglect, or to make a report that is malicious or reckless. The bill would require DHS or another designated agency to promptly investigate reports of abuse or neglect. The investigation could include a visit to the home and an interview with the resident. DHS would be required to file a petition for temporary care and protection when immediate removal is necessary to protect a resident from further abuse or neglect. The bill would require DHS to maintain a central registry of abuse and neglect reports. It would require licensed adult foster care homes to report resident deaths to DHS. It would also require DHS to correlate the reports with death certificate information and to develop statistical information about the official causes of death. The effective date for these provisions would be January 1, 1998. Methodolgy DHS estimates that the number of establishments covered by the adult foster care home licensing program would increase from about 250 in 1998 to more than 350 in the year 2002. It is assumed that DHS would inspect each home once a year and that each inspection would require 8 hours of staff time. It is also assumed that the number of complaint investigations would be negligible. The department would need one FTE position in 1998, and a second FTE position in 1999, to accommodate the additional workload. DHS would need to update existing automation systems to maintain the central registry of abuse and neglect reports and to develop the statistical information about official causes of death. It is assumed that this could be accomplished for less than $30,000. The department would also need one FTE position to handle the workload associated with maintaining the central registry and developing the statistical information. DHS does not believe it would be possible to set fees high enough to cover the costs of administering the licensing program. Each licensed adult foster care home would have to pay an average annual fee of nearly $400 to cover the administrative costs, and the bill does not require the Board of Human Services or the department to set such a fee. The probable fiscal implications of implementing the provisions of the bill during each of the first five years following passage is estimated as follows: Five Year Impact: Fiscal Year Probable Change in Number Savings/(Cost) of State from General Employees from Revenue Fund FY 1997 0001 1998 ($111,605) 2.0 1998 (120,956) 3.0 2000 (115,266) 3.0 2001 (115,266) 3.0 2002 (115,266) 3.0 Net Impact on General Revenue Related Funds: The probable fiscal implication to General Revenue related funds during each of the first five years is estimated as follows: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 ($111,605) 1999 (120,956) 2000 (115,266) 2001 (115,266) 2002 (115,266) Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. The bill would require local law enforcement agencies to accept reports of abuse or neglect and to refer these reports to DHS or another designated agency. It would require probate and county courts to order caretakers or operators to provide DHS with access to residents under certain circumstances. It would also require DHS to file written investigation reports with district attorneys and law enforcement agencies. It is assumed that there would be no significant fiscal implications for local government from passage of the bill. Source: Agencies: 340 Department on Aging 530 Department of Protective and Regulatory Services 324 Department of Human Services 320 Texas Workforce Commission LBB Staff: JK ,BB ,NM