LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              April 10, 2001
  
  
          TO:  Honorable David Sibley, Chair, Senate Committee on
               Business & Commerce
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  SB1514  by Lucio (Relating to the use of health care
               delivery networks to provide workers' compensation
               medical benefits to employees of the Texas Department of
               Transportation.), As Introduced
  
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*  No significant fiscal implication to the State is anticipated.        *
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The bill would amend the Labor Code to define a health care delivery
network, managed care organization, and managed care plan.  The bill
would also allow the Texas Department of Transportation (TxDOT) to
implement a health care delivery system, monitor for compliance, and to
enforce the provisions of the bill.  The bill would require TxDOT and the
Texas Department of Insurance (TDI) to share confidential information as
permitted by federal law, including financial data, that relates to or
affects a person that may contract with TxDOT to carry out the purposes
of the bill.  The bill would require the Texas Transportation Commission
and the Commissioner of Insurance to adopt rules necessary to implement
the provisions of the bill. 

The bill would allow TxDOT to establish one or more health care delivery
networks in various regions of the state or contract with managed care
organizations.  The bill would provide specific duties for a managed care
organization that contracts with TxDOT; require TxDOT to conduct audits
of each managed care organization at least biennially; and require TxDOT
to enter into a memorandum of understanding with TDI to coordinate the
audits.  The bill would establish guidelines for developing a health care
delivery system and would allow TxDOT to require the use of health care
delivery networks to provide medical benefits to employees.  The bill
would also require TxDOT to notify its employees of the adoption of a
health care delivery system and to periodically provide a list of the
participating providers.

TxDOT estimates that a cost savings of approximately $350,000 would be
realized each year by implementing the provisions of the bill.  However,
no significant fiscal implication to TxDOT is anticipated because it is
assumed that any savings realized would be used for other transportation
related expenses.  In addition, no significant fiscal implication to TDI
is anticipated.

The bill would take effect September 1, 2001, and would apply only to a
claim for workers' compensation benefits based on a compensable injury
that occurs on or after January 1, 2002.
  
Local Government Impact
  
No fiscal implication to units of local government is anticipated.
  
  
Source Agencies:   454   Texas Department of Insurance, 320   Texas
                   Workforce Commission, 601   Texas Department of
                   Transportation, 453   Texas Workers' Compensation
                   Commission, 479   State Office of Risk Management
LBB Staff:         JK, JO, RT, MW