LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  May 29, 1997
         
         
      TO: Honorable James E. "Pete" Laney            IN RE:  House Bill No. 2913, As Passed 2nd House
          Speaker of the House                Berlanga
          House of Representatives
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on HB2913 ( Relating 
to the authority of the Health and Human Services Commission 
to administer and operate the Medicaid managed care program.) 
this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by HB2913-As Passed 2nd House
         
No significant fiscal implication to the State is anticipated. 
 
         
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 amend current law governing 
the development of the health and human service delivery system 
by the Health and Human Services Commission (HHSC).  The bill 
would require HHSC to:  include certain considerations related 
to Medicaid managed care contracts to providers; ensure that 
Medicaid recipients are aware of care options available; inform 
managed care organizations of a recipient's Medicaid recertification 
date; ensure that contracting organization develop special disease 
management programs for conditions such as asthma and diabetes; 
contract with managed care organizations that are owned by hospital 
districts or created by certain nonprofit corporations; appoint 
regional Medicaid Managed Care Advisory Committees; direct the 
Department of Health (TDH) and Department of Human Services 
(DHS) to submit a plan to the Governor and Legislative Budget 
Board that would realize cost savings for the state by simplifying 
eligibility criteria and streamlining eligibility processes 
for recipients of public assistance; and provide a number of 
reports related to Medicaid managed care implementation to the 
Governor, Lieutenant Governor and Speaker of the House of Representatives. 
The bill would also make HHSC responsible for adopting rules 
related to setting rates, charges, and fees for medical assistance 
payments.    
 
Methodology
 
It is assumed that HHSC would 
collaborate with TDH, DHS, and other health and human services 
agencies in carrying out the provisions of the bill.  It is 
estimated that implementing the provisions of the bill would 
cost $97,788 in General Revenue Related Funds for the 1998-1999 
biennium, but these costs could be absorbed within existing 
resources of the various agencies.                 

It is 
assumed that HHSC would delegate most of the rate-setting functions 
to the health and human services agencies that currently set 
Medicaid rates or transfer employees and equipment from those 
agencies.
          
No significant fiscal implication to units of local government 
is anticipated.
          
   Source:            Agencies:   529   Health and Human Services Commission
                                         324   Department of Human Services
                                         501   Department of Health
                      LBB Staff:   JK ,BB