LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 14, 2001
TO: Honorable Elliott Naishtat, Chair, House Committee on
Human Services
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB527 by Moncrief (Relating to taking regulatory action
against assisted living facilities, including the
imposition of administrative penalties.), Committee
Report 2nd House, Substituted
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB527, Committee Report 2nd House, Substituted: negative impact *
* of $(999,336) 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. *
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General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(539,691) *
* 2003 (459,645) *
* 2004 (432,797) *
* 2005 (427,856) *
* 2006 (427,856) *
****************************************************
All Funds, Five-Year Impact:
***********************************************************************
*Fiscal Probable Probable Probable Probable Change in *
* Year Savings/ Revenue Revenue Savings/ Number of *
* (Cost) from Gain/(Loss) Gain/(Loss) (Cost) from State *
* General from from New Federal Employees *
* Revenue General Assisted Funds - from FY 2001 *
* Fund Revenue Living Federal *
* 0001 Fund Facility 0555 *
* 0001 Trust Fund *
* 2002 $(539,691) $0 $500,000 $(33,661) 4.5 *
* 2003 (464,586) 4,941 83,856 (30,867) 7.8 *
* 2004 (442,680) 9,883 84,025 (30,867) 7.8 *
* 2005 (442,680) 14,824 82,008 (30,867) 7.8 *
* 2006 (442,680) 14,824 82,008 (30,867) 7.8 *
***********************************************************************
Fiscal Analysis
The bill would amend Section 247, Health and Safety Code, and would
convey to the Department of Human Services (DHS) the authority to impose
administrative penalties against assisted living facilities. Section 8
of the bill adds Sections 247.0451 - 247.0457 pertaining to the
administrative penalties. Section 247.0454 provides that a person
charged with a violation under Section 247.0451 may have a hearing
before an Administrative Law Judge (ALJ). Section 247.051 requires the
Health and Human Services Commission (HHSC) to establish an informal
dispute resolution process. Section 242.0975 allows for an additional
license fee for assisted living facilities.
Methodology
Section 247.0451 would allow DHS to assess an administrative penalty
against a person who violates Chapter 247, or a rule adopted or term of a
license issued under this chapter. An administrative penalty of $1,000
may assessed an assisted living facility that is found in violation. The
department estimated that 3.3 staff would be needed pursuant to the
provisions of the bill. DHS assumed a one third ramp-up each year in
collections due to hearings and other normal delays and that estimated
collections would range from $4,941 in FY 2003 to $14,824 in FY 2006. DHS
estimated $275,000 would be needed in FY 2002 for automation.
Section 242.0975 requires the department to adopt an annual fee to be
charged and collected if the amount of the assisted living facility trust
fund is less than $500,000. The DHS estimated the range for collections
to be $83,856 in FY 2003 to $82,008 in FY 2006.
SOAH estimated they would hear approximately three to four cases per
month out of an average of 18 per month the DHS would refer. SOAH based
this estimate on experience with a similar program on nursing home
enforcement cases.
SOAH stated the nursing home hearings had been lasting from one to eight
days, with an average length of about three days. SOAH indicated in their
estimate that 2.5 new ALJs would be needed to handle the new hearings
and one Administrative Technician to support the ALJs handling these
cases.
A portion of the increased costs by SOAH associated with the referred
cases from DHS would be accounted for by an adjustment to the interagency
contract between DHS and the SOAH for services. The remaining costs at
SOAH and DHS, based on the SOAH and DHS estimates, would be General
Revenue.
HHSC estimated that 1.5 Nurse IV positions and associated operating costs
would be needed to implement Section 247.051 relating to establishment
of an informal dispute resolution process.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 324 Texas Department of Human Services, 360 State
Office of Administrative Hearings, 529 Health and
Human Services Commission
LBB Staff: JK, HD, ML