LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 26, 2001
TO: Honorable Bill Ratliff, Lieutenant Governor
Honorable James E. "Pete" Laney, Speaker of the House
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1156 by Zaffirini (Relating to the state Medicaid
program.), Conference Committee Report
**************************************************************************
* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1156, Conference Committee Report: positive impact of *
* $98,945,419 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 $44,373,639 *
* 2003 54,571,780 *
* 2004 91,009,890 *
* 2005 109,845,133 *
* 2006 116,987,092 *
****************************************************
All Funds, Five-Year Impact:
***********************************************************************
*Fiscal Probable Probable Probable Probable Change in *
* Year (Cost) to Savings to (Cost) to Savings to Number of *
* General General Federal Federal State *
* Revenue Revenue Funds - Funds - Employees *
* Fund Fund Federal Federal from FY 2001 *
* 0001 0001 0555 0555 *
* 2002 $64,099,983 $68,018,227 8.0 *
* $(20,328, $(50,445, *
* 178) 621) *
* 2003 96,618,406 87,109,660 20.0 *
* (42,968,363) (103,114, *
* 616) *
* 2004 141,757,134 154,979,571 23.0 *
* (51,912,246) (144,127, *
* 916) *
* 2005 168,261,771 194,852,688 11.0 *
* (59,824,998) (168,015, *
* 856) *
* 2006 179,924,080 212,397,264 9.0 *
* (64,588,783) (175,297, *
* 536) *
***********************************************************************
***************************************************************************
*Fiscal Probable Probable Probable Probable (Cost) *
* Year Savings to Savings to GR Revenue Gain to to All Local *
* Tobacco Match for HIV General Revenue Units of *
* for CHIP Services Fund Government *
* (Article II - 8005 0001 *
* Permanent *
* Funds) *
* 8025 *
* 2002 $157,088 $361,548 $83,198 $(13,995,094) *
* 2003 481,574 361,548 78,615 (12,007,187) *
* 2004 722,361 361,548 81,093 (12,010,195) *
* 2005 963,148 361,548 83,664 (12,010,195) *
* 2006 1,203,935 361,548 86,312 (12,010,195) *
***************************************************************************
Technology Impact
Technology costs relate to alien eligibility and HIV and Women's Health
waivers. Biennial costs would be $2,184,600 in General Revenue.
Fiscal Analysis
The bill would provide for Medicaid as follows: coverage for qualified
aliens; contracting for eligibility determination; nurse first
assistants; Health Insurance Premium Payment Reimbursement Program
(HIPPS) expansion; psychotropic medications, HIV, and women's health
demonstration projects; Program of All-Inclusive Care for the Elderly
(PACE) expansion; strategy development to improve program management;
and the transfer of the program from Texas Department of Health (TDH) to
the Health and Human Services Commission. The bill would authorize the
annual salary ($72,000) of the executive director of the Interagency
Council on Early Childhood Intervention.
Methodology
Alien Eligibility - The State Immigrant Health Insurance Program (SIHIP)
would experience a savings ($108.58 per recipient) as certain recipients
transfer to Medicaid. Average monthly number of recipients would decrease
by 121 in FY 2002, 370 in FY 2003, 554 in FY 2004, 739 in FY 2005, and
924 in FY 2006.
Pregnancy coverage - It is assumed that 49 participants in FY 2002, 83 in
FY 2003, 132 in FY 2004, 181 in FY 2005, and 229 in FY 2006 would
receive prenatal care ($450 per woman per pregnancy) and that
participants would already be eligible for delivery services through the
Medicaid emergency care program.
Contracting - It is assumed that contracting out for eligibility
determination services would not result in an increase in Medicaid
enrollment.
Nurse first assistants - It is assumed the Board of Nursing Examiners
would adjust fees to cover implementation costs.
HIPPS - It is assumed 200 new families would participate in March 2002.
Thereafter, there would be a 10% monthly increase until participation
reaches 5,000. Estimated annual cost savings per family is $3,668.
Average monthly premium cost would be $134 per family and an
administrative fee of $29 per month.
Medications Waiver - No more than 21,000 participants is assumed.
Estimated average cost for limited benefits and unlimited prescriptions
is $3,821 monthly. Participation is limited to clients with schizophrenia
and bipolar disorders. MHMR would no longer serve 12,697 clients, who
would participate in the waiver program. MHMR would need six new FTEs at
an average cost of $64,832. A six month implementation period is assumed.
It is assumed that 681 participants in FY 2003 and 1,363 thereafter,
would avoid Supplemental Security Income (SSI)/full Medicaid coverage.
The estimated average monthly cost per client is $825.05.
HIV Waiver - TDH estimates 2700 participants. The annual cost of
outpatient services would be $4,306 per client. The cost of a
hospitalization stay for a person with AIDS or HIV is $10,555. 15% of the
participants will require 1.8 hospitalization stays per year. The AIDS
Drug Assistance Program already funds participants' anti-retroviral drug
treatments. There would be a savings to the state HIV grant program; 80%
of these clients would be eligible for the demonstration project for a
total cost savings of $1,085,731. It is assumed the maintenance of effort
requirement for the HIV Care Formula Grant would be satisfied.
Adult Waiver - Beginning after September 1, 2001, TDH assumes 2000
participants. The same mix of risk groups that presently constitute the
Medicaid program is assumed. Reimbursement for travel and related
expenses for the advisory committee would have to be authorized in the
General Appropriations Act.
Women's Health Waiver - TDH assumes increases in the average monthly
number of adult recipients as follows: 191,344 in FY 2003, 447,345 in FY
2004, 558,255 in FY 2005, and 558,328 in FY 2006. The estimated average
monthly cost per client is $144.47. TDH assumes averted births due to
waiver services as follows: 1,240 in FY 2003, 6,978 in FY 2004, 12,018 in
FY 2005, and 14,288 in FY 2006. The estimated annual savings per averted
birth is $10,791. Additional FTEs at DHS total 12 in FY 2003, 15 in FY
2003, and decline thereafter.
PACE expansion - Savings are based on estimates from the e-Texas
recommendation (HHS-21) of the Comptroller of Public Accounts.
Strategy Development - It is assumed that HHSC develops and implements
all strategies included in the bill. Savings are based on estimates from
the Legislative Medicaid Workgroup Report.
Local Government Impact
See above table.
Source Agencies: 324 Texas Department of Human Services, 529
Health and Human Services Commission
LBB Staff: JK, HD, AJ, SW