LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
April 15, 1997
TO: Honorable Judith Zaffirini, Chair IN RE: Senate Bill No. 940
Committee on Health & Human Services By: Nelson
Senate
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on SB940 ( Relating
to the state's mental health and mental retardation services
system; providing penalties.) this office has detemined the
following:
Biennial Net Impact to General Revenue Funds by SB940-As Introduced
Implementing the provisions of the bill would result in a net
positive impact of $2,544,000 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
This bill would amend the Health and Safety Code to designate
the Department of Mental Health and Mental Retardation (TDMHMR)
as the state's lead agency in policy and services related to
mental health, mental retardation, and behavioral health. Each
state agency or local mental health and mental retardation authority
with a responsibility related to mental health, mental retardation,
or behavioral health policy or services would be required to
conform to TDMHMR s policies and standards regarding that responsibility.
Savings
from implementing the provisions of this bill are estimated
to be $1,272,000 in fiscal years 1998 and 1999, and $723,000
in fiscal years 2000-2002.
Methodolgy
The bill would partially implement Texas Performance Review
(TPR) recommendation HHS19 in Disturbing the Peace: The Challenge
of Change in Texas Government. The sections of the bill that
would implement TPR recommendations having a fiscal impact to
the state are described below.
Section 3 of the bill would
require that TDMHMR to conform to state agency space standards.
The Comptroller estimates that since the release of the report,
TDMHMR has avoided $570,000 in lease costs by eliminating all
Central Office lease space in the Austin area and consolidating
staff into available space at the Central Office facility and
Austin State Hospital. The Legislative Budget Board recommendations
for the 1998-99 biennium include a reduction of $1,200,000 for
the move from rent to state-owned office space. This recommendation
has been adopted by the House Appropriations Committee and Senate
Finance Committee. No additional savings from implementing
this provision of the bill are anticipated.
Section 5 would
provide penalties for violations of a service provider contract.
These sanctions could result in fines, penalties, or withholding
of payments and would reduce provider contract violations.
Section
6 would require TDMHMR to establish a reimbursement system for
local mental health and mental retardation centers designed
to contain costs for services funded from the General Revenue
Fund. Standardized rates would reduce payments for various
services provided by health professionals. According to the
Comptroller's estimate, general revenue savings in fiscal 1998
and 1999 would be $1,272,000 each year, and beginning in fiscal
year 2000, annual savings in general revenue would be reduced
to $723,000 due to the offset effect of disproportionate share
funding.
Section 12 would require TDMHMR to conduct a
comprehensive review of a local mental health or mental retardation
authority every three years. Current law requires these audits
each year. More frequent reviews could be conducted if warranted.
This would help the department focus its audit resources where
they would be most productive, thus utilizing the department's
resources more efficiently. According to HHS 19 in Disturbing
the Peace, TDMHMR has reviewed applicable policy and practice
issues and has written new procedures which would most effectively
be implemented on a maximum three-year cycle.
Section 13
would require TDMHMR to incorporate a voucher reimbursement
system for certain programs. Savings would result from a change
in the reimbursement methodology for the Home and Community-based
Services (HCS) program and other programs. According to the
Comptroller, the estimated savings would be $4,840,000 in fiscal
1998, $9,680,000 in fiscal 1999, $14,520,000 in fiscal 2000,
and would increase to $19,360,000 each year beginning in fiscal
2001.
In response to legislative direction during the previous
session, TDMHMR has already implemented a new HCS reimbursement
rate methodology. The Legislature enacted a $10.4 million general
revenue reduction for the 1996-97 biennium based on implementing
this new reimbursement methodology. In January 1997, TDMHMR's
Board of Directors approved the revised HCS reimbursement methodology.
TDMHMR anticipates collecting $110 million in additional federal
funds for the 1998-99 biennium based on the new rate methodology.
Implementing TPR's recommendation and further reducing general
revenue in order to incorporate the savings from Section 13
of the bill could jeopardize the department's collection of
the additional federal funds. No additional savings are assumed
from implementing this provision of the bill.
Section 14
would create a conservatorship program at TDMHMR to allow TDMHMR
to assume operations of a service provider. Implementation
of the conservatorship program should help to ensure better
use of TDMHMR funds and allow appropriate client services to
continue without interruption.
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
Savings/(Cost)
from General
Revenue Fund
0001
1998 $1,272,000
1998 1,272,000
2000 723,000
2001 723,000
2002 723,000
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 $1,272,000
1999 1,272,000
2000 723,000
2001 723,000
2002 723,000
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: Agencies:
302 Office of the Attorney General
304 Comptroller of Public Accounts
655 Texas Department of Mental Health and Mental Retardation
LBB Staff: JK ,BB ,MG