LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 76th Regular Session April 22, 1999 TO: Honorable Jane Nelson, Chair, Senate Committee on Health Services FROM: John Keel, Director, Legislative Budget Board IN RE: HB2085 by McCall (Relating to the continuation and functions of the Texas Board of Health and Texas Department of Health, including the operation of certain boards and councils administratively attached to the department; providing penalties.), As Engrossed ************************************************************************** * Estimated Two-year Net Impact to General Revenue Related Funds for * * HB2085, As Engrossed: positive impact of $2,375,000 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. * * * * The bill would provide for the continuation of the Texas Department * * of Health and certain boards and councils administratively * * attached to the department until September 1, 2011. * ************************************************************************** General Revenue-Related Funds, Five-Year Impact: **************************************************** * Fiscal Year Probable Net Positive/(Negative) * * Impact to General Revenue Related * * Funds * * 2000 $650,000 * * 2001 1,725,000 * * 2002 1,725,000 * * 2003 1,725,000 * * 2004 1,725,000 * **************************************************** All Funds, Five-Year Impact: *************************************************************************** *Fiscal Probable Savings/(Cost) from Probable Savings/(Cost) from * * Year General Revenue Fund Federal Funds * * 0001 0555 * * 2000 $650,000 $0 * * 2001 1,725,000 1,075,000 * * 2002 1,725,000 1,075,000 * * 2003 1,725,000 1,075,000 * * 2004 1,725,000 1,075,000 * *************************************************************************** Fiscal Analysis Fiscal analysis is based on information submitted by the Sunset Advisory Commission. Sections of the bill that would result in a fiscal impact include a provision requiring electronic funds transfer of Medicaid payments and a provision requiring the department to integrate health care delivery programs. A provision in the bill that would transfer responsibility for administrative hearings in contested cases under Chapter 2001, Government Code, to the State Office of Administrative Hearings is not projected to result in increased overall costs to the state. It is assumed that the provision of the bill requiring an annual external audit of the Medicaid fiscal agent could be accomplished within existing resources. It is assumed that provisions relating to a comprehensive strategic and operational plan and requiring the department to comprehensively study the impact that the state's Medicaid managed care program has had on populations served by the department and on providers, clinics, and hospitals can be accomplished within existing resources. Other provisions in the bill are not anticipated to have a significant fiscal impact. The bill would also create the Emergency Medical Services Advisory Council, a 15 member council appointed by the governor. It is assumed that members of the council would receive reimbursement for travel and related costs. Reimbursement for travel and other expenses for the council would require authority in the General Appropriations Act. Methodology The estimates included in the tables above are based on analysis submitted by the Sunset Advisory Commission. The provision in the bill that requires electronic funds transfer of Medicaid payments is estimated to save approximately $650,000 per fiscal year due to savings in contract costs from administrative efficiencies due to paying Medicaid providers through electronic funds transfer rather than by mailing paper checks, offset by reduced interest earnings from the quicker payment of claims. The provision in the bill that requires the department to integrate health care delivery programs is estimated to save approximately $2 million in General Revenue and Federal funds per year, beginning in fiscal year 2001. Savings are estimated to be 10 percent of the amounts currently expended by the department for administration of health care delivery programs. Local Government Impact No significant fiscal implication to units of local government is anticipated. Source Agencies: 116 Sunset Advisory Commission, 501 Department of Health LBB Staff: JK, TP, KF