LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
April 16, 2001
TO: Honorable David Sibley, Chair, Senate Committee on
Business & Commerce
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1571 by Nelson (Relating to the creation and duties of
the Health Care Services Contract Panel.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1571, As Introduced: positive impact of $0 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 $0 *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 0 *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Probable Revenue Change in Number of *
* Year Savings/(Cost) from Gain/(Loss) from State Employees from *
* Texas Department of Texas Department of FY 2001 *
* Insurance Operating Insurance Operating *
* Fund Account/ Fund Account/ *
* GR-Dedicated GR-Dedicated *
* 0036 0036 *
* 2002 $(357,760) $357,760 6.0 *
* 2003 (140,644) 140,644 2.0 *
* 2004 (140,644) 140,644 2.0 *
* 2005 (140,644) 140,644 2.0 *
* 2006 (140,644) 140,644 2.0 *
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Technology Impact
Computers and software for two additional Full-time Equivalent positions
(FTEs) totaling $5,398 in fiscal year 2002.
Fiscal Analysis
The bill adds Chapter 20D to the Texas Insurance Code. The provisions of
the bill create a nine-member Health Services Contract Panel to be
appointed by the Lieutenant Governor and the Speaker of the House. The
provisions of the bill direct the Panel to establish, by rule, standard
contract forms for health benefit plans to use when contracting with
physicians and other health care providers. The Panel is to be
administratively attached to the Texas Department of Insurance (TDI) and
TDI employees shall serve as staff for the panel. The Panel, in
consultation with the Commissioner of Insurance, must adopt rules by
January 1, 2002, requiring the use of the standard forms. The Panel may
not prohibit the use of non-standard forms. Panel members may be
reimbursed for travel expenses.
The bill is effective immediately if it receives the necessary two-thirds
vote; otherwise, the bill is effective September 1, 2001.
Methodology
TDI estimates that it would need six additional FTEs in fiscal year 2002
and two FTEs in subsequent years. TDI would need four Insurance
Specialists for fiscal year 2002 to develop standardized contracts for
the voluminous types of contracts to be promulgated, and the rule
adoption deadline of January 1, 2002. They would continue to be needed
after the January 1, 2002 rule adoption date to answer HMO and contractor
questions about the new language and develop any necessary amendments to
the rules. The Insurance Specialists would work with TDI's Legal staff,
industry, consumers, and physicians/providers to develop and implement
the rules.
TDI estimates needing two Attorneys for fiscal year 2002 and subsequent
years. TDI anticipates on-going revisions to the contracts, forms and
other documents used in managed care plans and rules. TDI will need to
provide additional staff with expertise and specialized knowledge of
physician provider organizations (PPOs) and HMOs to perform the duties
required.
Travel costs for Panel members are estimated to be approximately $5,400
($600 per member) for fiscal year 2002. TDI expects this Panel to meet
at least four times during rule development in fiscal year 2002 and to
have periodic meetings to update and revise contracts as may be needed in
the following years.
It is assumed that TDI would adjust its fees to cover the cost of
implementing the bill.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 304 Comptroller of Public Accounts, 601 Texas
Department of Transportation, 454 Texas Department
of Insurance
LBB Staff: JK, JO, RT, DE