LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              March 20, 2001
  
  
          TO:  Honorable Patricia Gray, Chair, House Committee on Public
               Health
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB1231  by Maxey (Relating to prices of prescription
               drugs provided to Medicare recipients by pharmacies
               participating in the Medicaid Vendor Drug Program.), As
               Introduced
  
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*  No significant fiscal implication to the State is anticipated.        *
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The bill would require a provider in the Medicaid Vendor Drug Program to
provide any prescription drug  available to a Medicare recipient at a
price not greater than the amount of reimbursement the provider would
have received for providing the same drug to a Medicaid recipient plus
an administrative fee not to exceed fifteen percent. The bill would
implement recommendation HHS-13 from the Comptroller's e-Texas report.
This cost estimate reflects the Comptroller's analysis of no significant
fiscal impact to the State, however, the Department of Health estimates
that mainframe automation costs required to modify the Vendor Drug
system would include the following:  $550,000 for initial reprogramming
(5,000 programming hours at $110 per hour), and $605,375 in annual
transaction costs (12,107,500 transactions at $0.05 per transaction).
  
Local Government Impact
  
No significant fiscal implication to units of local government is
anticipated.
  
  
Source Agencies:   529   Health and Human Services Commission, 324
                   Texas Department of Human Services, 304   Comptroller
                   of Public Accounts, 501   Texas Department of Health
LBB Staff:         JK, HD, AJ