C.S.H.B. 3182 78(R)    BILL ANALYSIS


C.S.H.B. 3182
By: Delisi
State Health Care Expenditures, Select
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

The states of Florida, Arkansas, and New Jersey have successfully
experimented with an innovative Medicaid consumer-directed care model that
assists those in need of  home-based services.  The key feature in these
models is that recipients have greatly increased control over the money
spent on their behalf and can actually hire their own care-givers.
Recipients also have far greater latitude to use these funds on other
products or services that enhance their health and well-being, to include
durable medical equipment, home modifications, etc. The recipients are
provided with assistance in managing the funds spent on their behalf. 

In early 2002, both houses of the Florida Legislature voted unanimously to
continue their consumerdirected care project. The state of Oregon has also
moved forward with a project based upon the same service model. 

Client satisfaction rates with this new consumer-directed services model
have been recorded as high as 99 percent. Health outcomes also appear to
be positively impacted. For example, the development or worsening of
bedsores was reduced by more than half. Especially significant is a
finding that institutional care costs were 18 percent higher for those not
participating in the program. 

The evidence of improved health outcomes and reductions in the need for
institutional care indicate this program has the potential to deliver
better services at a reduced overall cost. 
 
This legislation would direct the Health and Human Services Commission
(HHSC) to establish a consumer-directed services program in Texas. This
both implements a recommendation in the comptroller's e-Texas II report
and moves forward efforts already underway at the HHSC to encourage
increase involvement by certain Medicaid recipients in directing their own
care. 

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is expressly
granted to the HHSC in SECTION 1  (Section 32.057 (b) Human Resources
Code) of this bill. 

ANALYSIS

This legislation would require the HHSC to establish a consumer-directed
services program in which certain individuals enrolled in a medical
assistance waiver program are given a monthly stipend to direct the
delivery of home and community-based services provided to the individual.
The HHSC will ensure that the amount of a consumer's stipend is based on
the assessed functional needs of a consumer and the financial resources
available to the medical assistance waiver program providing services to
the consumer and develop purchasing guidelines to assist consumers in
using the stipend to purchase necessary and cost-effective home and
community-based services. 

The HHSC will ensure that the consumer is the employer of and retains
control over the selection, management, and dismissal of an individual
providing home and community-based services. 

The bill states that both a private entity or a government entity may
apply to the state for approval to act as a fiscal intermediary for the
recipient for the limited purpose of managing a recipient's stipend,
computing federal and state employment taxes, preparing and filling
necessary tax forms and reports, and distributing funds to service
providers. 
 
The HHSC is further directed to determine, in consultation with the
Centers for Medicare and Medicaid Services, if additional state-funded or
government-funded programs are appropriate for inclusion in the
consumer-directed services program. The HHSC is also to provide for the
inclusion of cost-sharing provisions as practicable. 

Not later than February 1 of each year, the HHSC will submit to the
governor, lieutenant governor, and the clerks of the standing committees
of the senate and house of representatives with primary jurisdiction over
long-term care services a report on the effectiveness of the program. The
report must include recommendations for improvements. 

EFFECTIVE DATE

The Act would take effect on September 1, 2003.
      
COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute differs from the original in  SECTION 1, Sec. 32.057, by
deleting and replacing the word "CARE" with the word "SERVICES" and
deleting the word "DEMONSTRATION". 

The substitute differs from the original in SECTION 1, Sec. 32.057 (b) by
deleting the word "demonstration" and replacing it with the words
"consumer-directed services." 

The substitute differs from the original in  SECTION 1, Sec. 32.057 (c) by
deleting the word "demonstration" and replacing it with the words
"consumer-directed services." 

The substitute differs from the original in  SECTION 1, Sec. 32.057 (d) by
deleting the word "demonstration" and replacing it with the words
"consumer-directed services." 

The substitute differs from the original in  SECTION 1, Sec. 32.057 (d)
(3) by deleting the words "applies with and is approved by" and replacing
them with "may apply with". The words "and the Internal Revenue Service"
are also deleted. 

The substitute differs from the original in  SECTION 1, Sec. 32.057 (f) by
deleting "The department shall operate the demonstration program in each
of the Medicaid managed care service delivery areas" and replacing it with
the following language, "The department may not implement the
consumer-directed services program within the consolidated waiver pilot
program before January 2, 2004." 

The substitute differs from the original in  SECTION 1, Sec. 32.057 (g) is
renumbered as subsection (h) and a new subsection (g) is inserted that
reads as follows: " The department, in consultation with the Centers for
Medicare and Medicaid Services, shall: 

(1)  determine which state or other government-funded programs are
appropriate for inclusion in the consumer-directed services program; and 
 (2)  provide for the inclusion of cost-sharing provisions as practicable."

The substitute differs from the original in  SECTION 1, Sec. 32.057 (g),
which is renumbered as subsection (h) and has the following words deleted:
"and for the implementation of the program in additional counties or
statewide, as appropriate." 

The substitute differs from the original in  SECTION 1, Sec. 32.057 (h)
which is renumbered as subsection (i).