LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
Revision 1
April 23, 2001
TO: Honorable David Cain, Chair, Senate Committee on
Administration
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB844 by Fraser (Relating to assessment of the impact of
proposed health care benefit mandates and offer of
coverage mandates.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB844, As Introduced: negative impact of $(860,150) 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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This bill creates a impact assessment on health care benefit mandates and
offer of coverage mandates to be done by the Legislative Budget Board
(LBB). During the legislative session, the LBB would create impact
assessments when requested by the chair of a committee. The LBB has 21
days to produce the impact assessment, and the impact assessment is to
remain with the bill throughout the legislative process, including
submission to the governor. There are certain requirements for the
content and creation of the impact assessment. During the interim, the
LBB would analyze mandates and offer of coverage mandates that will
expire and would make recommendations on the continuation or
modification of these mandates and offer of coverage mandates to the
Legislature.
General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(189,145) *
* 2003 (671,005) *
* 2004 (191,005) *
* 2005 (671,005) *
* 2006 (206,005) *
****************************************************
All Funds, Five-Year Impact:
*****************************************************
* Fiscal Year Probable Savings/(Cost) from *
* General Revenue Fund *
* 0001 *
* 2002 $(189,145) *
* 2003 (671,005) *
* 2004 (191,005) *
* 2005 (671,005) *
* 2006 (206,005) *
*****************************************************
Technology Impact
Computer hardware and software for additional FTE's.
Fiscal Analysis
The requirement that the LBB conduct impact assessments of proposed
mandated health benefits or offer of coverage mandates within 21 days
will result in costs to the Legislative Budget Board. These costs
include additional staff and associated costs, and costs to contract for
professional services.
The requirement to assess certain health care benefit mandates and offer
of coverage mandates during the interim will also result in costs to the
LBB.
The bill would become effective September 1, 2001.
Methodology
This estimate assumes that the Legislative Budget Board will hire
internal staff before the 78th Legislative session, and would provide
impact assessments beginning with the 78th Legislative session (2003).
The estimate assumes that data will be available to conduct the
assessments, and that the Legislative Budget Board will be able to
contract for professional services for the analysis, and would not have
to purchase any data. This estimate also assumes that impact assessments
will be requested only on bills that contain mandated health benefit
proposals or offer of coverage mandates. The estimate for the cost of
the impact assessments are calculated as follows: it is assumed that
there will be about 30 mandates introduced in each legislative session;
that of those 30, about 75 percent will require an impact assessment;
that subsequent legislative activity on the bills will require
approximately 11 additional updated impact statements; and that each
impact assessment will cost $15,000.
For the analysis conducted during the interim, it is assumed that there
will be no health benefit mandates or offer of coverage mandates that
will need to be reviewed in 2002. Thereafter, it is assumed that there
will be one review in 2004 and 2 reviews in 2006. The analysis cost for
each assessment during the interim is assumed to be $15,000.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 454 Texas Department of Insurance, 327 Employees
Retirement System, 304 Comptroller of Public
Accounts
LBB Staff: JK, SD, AD