LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 77th Regular Session May 1, 2001 TO: Honorable Elliott Naishtat, Chair, House Committee on Human Services FROM: John Keel, Director, Legislative Budget Board IN RE: SB1245 by Moncrief (Relating to reporting certain acts of misconduct by and background checks of certain employees and applicants for employment of certain health care agencies and facilities.), As Engrossed ************************************************************************** * Estimated Two-year Net Impact to General Revenue Related Fundsfor * * SB1245, As Engrossed: positive impact of $252,566 for an * * immediate effective date, and a positive impact of $213,738 for a * * September 1, 2001 effective date, for 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. * ************************************************************************** All Funds, Six-Year Impact: *********************************************************************** *Fiscal Probable Probable Probable Probable Change in * * Year Savings/ Savings/ Savings/ Savings/ Number of * * (Cost) from (Cost) from (Cost) from (Cost) from State * * General General Federal Federal Employees * * Revenue Revenue Funds - Funds - from FY 2001 * * Fund Fund Federal Federal * * 0001 0001 0555 0555 * * 2001 $(25,450) $111,249 $(12,366) $28,161 0.0 * * 2002 (349,488) 444,955 (45,168) 112,683 1.0 * * 2003 (373,655) 444,955 (50,210) 112,683 1.0 * * 2004 (375,365) 444,955 (50,379) 112,683 1.0 * * 2005 (376,505) 444,955 (50,491) 112,683 1.0 * * 2006 (377,075) 444,955 (50,548) 112,683 1.0 * *********************************************************************** The table above assumes an immediate effective date. All Funds, Five-Year Impact: The table below assumes a September 1, 2001, effective date. *********************************************************************** *Fiscal Probable Probable Probable Probable Change in * * Year Savings/ Savings/ Savings/ Savings/ Number of * * (Cost) from (Cost) from (Cost) from (Cost) from State * * General General Federal Federal Employees * * Revenue Revenue Funds - Funds - from FY 2001 * * Fund Fund Federal Federal * * 0001 0001 0555 0555 * * 2002 $(302,517) $444,955 $(46,825) $112,683 1.0 * * 2003 (373,655) 444,955 (50,210) 112,683 1.0 * * 2004 (375,365) 444,955 (50,379) 112,683 1.0 * * 2005 (376,505) 444,955 (50,491) 112,683 1.0 * * 2006 (377,075) 444,955 (50,548) 112,683 1.0 * *********************************************************************** Fiscal Analysis The bill would amend Chapter 48 of the Human Resources Code to require the Department of Protective and Regulatory Services (PRS) to develop and implement procedures for reporting misconduct by certain unlicensed employees of home and community support services (home health) agencies. Reportable conduct would include abuse or neglect that harms an individual receiving agency services and financial exploitation ($25 or more) of an individual receiving agency services. The procedures would include but not be limited to providing written notice of findings to the employee; offering the employee a formal administrative hearing; issuing an order based on the hearings examiner's findings of fact, conclusions of law and recommended decision; and providing for judicial appeal of the order. The bill would also require PRS by rule to adopt procedures governing informal proceedings and to forward findings of reportable conduct to the Department of Human Services (DHS) for recording in the Employee Misconduct Registry (EMR). Home and community support services agencies would not be allowed to employ a person listed on the registry. The bill would amend Chapter 250 of the Health and Safety Code to authorize long-term care facilities, unlicensed attendant care agencies that contract with DHS, adult foster care providers that contract with DHS, local mental health and mental retardation authorities, and home and community support services agencies to obtain criminal history record information directly from the Texas Department of Public Safety (DPS). It would prohibit these entities from employing a person in any position (including a position that does not include direct contact with consumers) based on adverse information obtained from inquiries made to the DHS EMR or Nurse Aide Registry (NAR). The bill would take effect immediately if it receives two-thirds vote in each chamber, or on September 1, 2001. The amendments to Chapter 48 of the Human Resources Code would only apply to reportable conduct that occurs on or after the effective date of the act. Methodology It is assumed PRS would implement the new reporting requirement under Chapter 48 of the Human Resources Code six months after the effective date which is assumed to be December 1, 2001, for immediate effect and March 1, 2002, for September 1, 2001 effective date. It is assumed DHS would realize savings, as well as costs, based on the changes to Chapter 250 of the Health and Safety Code for either effective date. PRS estimates the number of home and community support services agency employees subject to the new reporting requirement ("confirmed perpetrators") under Chapter 48 of the Human Resources Code would be 177 for 2002, 184 for 2003, 190 for 2004, 194 for 2005, and 196 for 2006. PRS also estimates that 90% of these individuals would request a formal or informal administrative review. It is assumed that 20% of those requesting an administrative review would file an appeal. PRS would require three additional FTE positions to handle the workload associated with the new program including an attorney, a program specialist, and an adult protective services specialist. The method-of-finance assumes 90% General Revenue Funds and 10% federal matching funds from Medicaid. DHS estimates there would be an annual telecommunications cost of approximately $50,000 to handle an increased volume of calls from home and community support services agency employers seeking information about unlicensed direct care staff. DHS would require an additional FTE position (Administrative Technician III) to manually enter information on to the EMR, provide notification, and handle direct caller inquiries. The method-of-finance would be 100% General Revenue Funds. DHS assumes it would no longer process criminal history background checks for the entities that could obtain criminal history record information directly from DPS under Chapter 250 of the Health and Safety Code. This would result in an annual savings of $557,638 and four FTE positions due to the elimination of costs associated with conducting approximately 300,000 background checks per year. The method-of-finance for the savings would be 80% General Revenue Funds and 20% Federal Funds. DHS also assumes phone calls to the EMR and NAR would double because of the requirement that entities check all employees. This would result in an annual cost of approximately $83,000 plus $17,000 to upgrade the phone system. The method-of-finance for the cost would be 67% General Revenue Funds and 33% Federal Funds. The Texas Department of Mental Health and Mental Retardation indicates there would be a substantial (but not quantified) fiscal impact upon the agency if the Chapter 250 bar on employment is absolute and retroactive to include persons who committed minor offenses in the past, corrected or not, due to the requirement that such persons be terminated and new persons attracted, hired and trained. Local Government Impact No significant fiscal implication to units of local government is anticipated. Source Agencies: 405 Texas Department of Public Safety, 324 Texas Department of Human Services LBB Staff: JK, HD, NM