LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 76th Regular Session
  
                               May 13, 1999
  
  
          TO:  Honorable Jane Nelson, Chair, Senate Committee on Health
               Services
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB714  by Naishtat (Relating to the establishment of a
               newborn hearing screening, tracking, and intervention
               program.), As Engrossed
  
**************************************************************************
*  Estimated Two-year Net Impact to General Revenue Related Funds for    *
*  HB714, As Engrossed:  negative impact of $(4,297,933) through the     *
*  biennium ending August 31, 2001.                                      *
*                                                                        *
*  The bill would make no appropriation but could provide the legal      *
*  basis for an appropriation of funds to implement the provisions of    *
*  the bill.                                                             *
**************************************************************************
  
General Revenue-Related Funds, Five-Year Impact:
  
          ****************************************************
          *  Fiscal Year  Probable Net Positive/(Negative)   *
          *               Impact to General Revenue Related  *
          *                             Funds                *
          *       2000                         $(2,605,906)  *
          *       2001                          (1,692,027)  *
          *       2002                            (618,005)  *
          *       2003                            (618,778)  *
          *       2004                            (619,937)  *
          ****************************************************
  
All Funds, Five-Year Impact:
  
**************************************************************************
*Fiscal        Probable             Probable             Probable        *
* Year    Savings/(Cost) from  Savings/(Cost) from  Savings/(Cost) from  *
*        General Revenue Fund     Federal Funds            Local         *
*                0001                 0555                               *
*  2000           $(2,605,906)         $(1,024,291)           $(660,000) *
*  2001            (1,692,027)            (767,647)            (660,000) *
*  2002              (618,005)            (481,309)            (660,000) *
*  2003              (618,778)            (482,536)            (660,000) *
*  2004              (619,937)            (484,377)            (660,000) *
**************************************************************************
  
Technology Impact
  
Software licenses for the newborn hearing screening reporting software is
assumed to total $1.2 million in fiscal year 2000.  The service plan for
implementation of the software, according to the Department of Health,
is $750,000 in fiscal year 2000 and $750,000 in fiscal year 2001.
  
  
Fiscal Analysis
  
The bill would require a birthing facility to offer the parents of a
newborn a hearing screening for the newborn for the detection of hearing
loss.  The Department of Health would be required to approve program
protocols, would be allowed to maintain data on each newborn who receives
services, and would be required to ensure that intervention is available
to families for a newborn identified as having hearing loss.  The bill
would require the Department of Health to provide each birthing facility
with the appropriate software for the program.

The bill would direct the Medicaid program to provide a hearing screening
for infants in the Medicaid program.

The bill would direct health benefit plans to cover hearing screens.
  
  
Methodology
  
General Revenue and Federal Funds impact numbers in the tables above were
calculated by the Department of Health.

The Department of Health assumes new costs would be incurred by the
Medicaid program in association with the implementation of the provisions
of this bill.  Increased costs in the Program for Amplification for
Children of Texas (PACT) for hearing aids, audiological assessments, etc.
These would be reimbursed at the client services matching rate
(approximately 39 percent state, 61 percent federal) .

The department assumes that distribution of software and technical
assistance would be required.  The state would receive a fifty-fifty
match rate for software and training for costs allocated for
Medicaid-eligible clients.  Some proportion of the costs would be 100
percent General Revenue.

The department assumes some increased costs in both the Medicaid and
non-Medicaid areas associated with the provisions directing follow-up.
These costs are estimated to be approximately $300,000 per fiscal year in
the Medicaid program and approximately $130,000 per fiscal year for
non-Medicaid clients.  Medicaid costs are assumed to be matched at a
fifty-fifty rate and non-Medicaid costs are assumed to be 100 percent
General Revenue.  The bill would require the department to ensure that
intervention is available to families for a newborn identified as having
a hearing loss and that the intervention is managed by state programs
operating under the Individuals with Disabilities Education Act.

The hospital reimbursement for the screen would become part of the
Diagnosis Related Group (DRG) reimbursement in the Medicaid program.
However, the Department of Health has not provided the dollar value of
this impact; therefore, the cost estimates understate the impact to the
General Revenue Fund.
  
  
Local Government Impact
  
No significant fiscal implication to units of local government is
anticipated.
  
  
Source Agencies:   501   Department of Health
LBB Staff:         JK, TP, KF