LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              March 16, 2001
  
  
          TO:  Honorable Kim Brimer, Chair, House Committee on Business
               & Industry
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB1192  by Brimer (Relating to a gateway doctor pilot
               program for the provision of medical benefits to certain
               state employees who sustain compensable injuries.),
               Committee Report 1st House, Substituted
  
**************************************************************************
*  Estimated Two-year Net Impact to General Revenue Related Funds for    *
*  HB1192, Committee Report 1st House, Substituted:  positive impact     *
*  of $132,966 through the biennium ending August 31, 2003.              *
*                                                                        *
*  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                *
          *       2002                              $22,007  *
          *       2003                              110,959  *
          *       2004                              142,847  *
          *       2005                              161,852  *
          *       2006                              182,221  *
          ****************************************************
  
All Funds, Five-Year Impact:
  
***************************************************************************
*Fiscal    Probable Savings/(Cost) from    Probable Savings/(Cost) from   *
* Year         General Revenue Fund            General Revenue Fund       *
*                      0001                            0001               *
*  2002                         $(14,672)                         $36,679 *
*  2003                          (73,973)                         184,932 *
*  2004                          (95,231)                         238,078 *
*  2005                         (107,901)                         269,753 *
*  2006                         (121,481)                         303,702 *
***************************************************************************
  
Technology Impact
  
Any technology impact would be provided through current agency resources.
  
  
Fiscal Analysis
  
This bill would establish a pilot project for using a gateway physician
program for state employees incurring compensable injuries on the job.
The bill would require State Office of Risk Management (SORM) and the
Research and Oversight Council on Workers' Compensation (ROC) to
establish the network of gateway physicians by December 1, 2001, as well
as the rules and regulations needed to set up the network.  SORM and ROC
would also determine which state agencies would participate in the pilot
project, with agency participation mandated by the bill.  ROC would be
required to submit a report to the Legislature by February 1st of each
odd numbered year on the impact of the pilot project on state workers'
compensation costs.

The bill would partially implement Comptroller's e-Texas recommendation
HHS 19.

The bill would take effect September 1, 2001.
  
  
Methodology
  
ROC would absorb the impact of the study within the agency's current
resources.  SORM estimates a gross savings of 20 percent from the gateway
physician pilot project and a net savings of approximately 12 percent.
SORM assumes the fiscal 2000 usage and costs as the baseline for future
comparisons of the pilot project's success.  The projected costs and
savings are based on the actual fiscal 2000 expenditures and claims,
allowing for a 7.5 percent growth factor for medical cost increases.

The savings from lower workers' compensation reimbursements from agency
budgets would depend on the agencies chosen to participate in the pilot
project and their respective method of finance.
  
  
Local Government Impact
  
No fiscal implication to units of local government is anticipated.
  
  
Source Agencies:   478   Research and Oversight Council on Workers'
                   Compensation, 479   State Office of Risk Management,
                   453   Texas Workers' Compensation Commission
LBB Staff:         JK, JO, KM, RT