Honorable Patrick M. Rose, Chair, House Committee on Human Services
FROM:
John S. O'Brien, Director, Legislative Budget Board
IN RE:
HB2843 by Herrero (Relating to medical assistance for certain children with disabilities.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB2843, As Introduced: a negative impact of ($56,007,803) through the biennium ending August 31, 2009.
The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
Fiscal Year
Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2008
($440,370)
2009
($55,567,433)
2010
($59,623,578)
2011
($64,654,954)
2012
($70,439,716)
Fiscal Year
Probable (Cost) from GR MATCH FOR MEDICAID 758
Probable (Cost) from VENDOR DRUG REBATES-MEDICAID 8068
Probable (Cost) from FEDERAL FUNDS 555
Probable Revenue Gain from VENDOR DRUG REBATES-MEDICAID 8068
2008
($440,370)
$0
($440,369)
$0
2009
($55,567,433)
($4,020,060)
($75,250,469)
$4,020,060
2010
($59,623,578)
($4,467,702)
($80,728,249)
$4,467,702
2011
($64,654,954)
($5,021,033)
($87,684,177)
$5,021,033
2012
($70,439,716)
($5,656,556)
($95,673,406)
$5,656,556
Fiscal Year
Change in Number of State Employees from FY 2007
2008
0.0
2009
324.0
2010
328.0
2011
331.0
2012
335.0
Fiscal Analysis
The bill would amend Subchapter B, Chapter 32, Human Resources Code by adding Section 32.02492 to establish a new financial eligibility category of Medicaid for children with disabilities who are not otherwise financially eligible, using criteria in 42 U.S.C. sec 1396a (e) (3). That section of federal law authorizes states the option to treat children age 18 or younger, who are disabled under Supplemental Security Income (SSI) criteria, as SSI-eligible (and therefore Medicaid eligible) if 1) they require a level of care provided in a hospital, nursing facility, or ICF/MR, 2) they would be appropriately served in the community, 3) the cost of their care in the community is not greater than the cost in an institution, and 4) they meet the institutional income limits under the state plan (in Texas, it is 300 percent of SSI). The bill would direct the Executive Commissioner of Health and Human Services to adopt rules.
The bill would authorize an implementation delay if a federal waiver or prior authorization is required. The provisions of the bill would require a state plan amendment.
Methodology
The Health and Human Services Commission (HHSC) included one-time program administration costs in fiscal year (FY) 2008, such as automation changes, training, and other miscellaneous implementation costs. HHSC estimated these costs to be $880,739 in All Funds. HHSC also included 12 FTEs (Eligibility Advisors-B4) in the administrative costs for fiscal years 2009 through 2012 and associated staff costs as well as contractor fees for eligibility and enrollment.
HHSC assumed implementation in fiscal year 2009 with an estimated Medicaid caseload increase in the number of recipient months per month of 8,901 in FY 2009; 8,967 in FY 2010; 9,055 in FY 2011; and 9,166 in FY 2012. For the average cost per recipient month HHSC estimated $1,105.15 in FY 2009, $1,188.26 in FY 2010, $1,290.74 in FY 2011, and $1,404.20 in FY 2012.
HHSC estimated the client service All Funds cost for the new populations to be approximately $118.0 million in FY 2009, $127.9 million in FY 2010, in FY 2011, $140.3 million, and in FY 2012 $154.5 million. Services would be matched at the Medicaid match rate, approximately 40 percent state and 60 percent federal.
The Department of Aging and Disability Services (DADS) would perform initial functional eligibility determinations, and annual re-determinations for the new population to determine whether the children: 1) require a level of care provided in a hospital, NF, or ICF/MR, 2) would be appropriately served in the community, and 3) ensuring that the cost of their care in the community is not greater than the cost in an institution. DADS estimated those costs to be $15.5 million All Funds and 312 FTEs in FY 2009, $15.7 million All Funds and 316 FTEs in FY 2010, $15.8 million All Funds and 319 FTEs in FY 2011, and $16.0 million All Funds and 323 FTEs in FY 2012. The DADS costs would be matched at 50 percent state and 50 percent federal.
Technology
HHSC indicated automation changes would be needed for systems that support eligibility determination. HHSC estimated that cost to be $850,000 in FY 2008. In addition, HHSC estimated that seat management expense for the 12 additional FTEs would be $10,860 for each year from FY 2009 through FY 2012.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies:
529 Health and Human Services Commission, 539 Aging and Disability Services, Department of