LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 80TH LEGISLATIVE REGULAR SESSION

April 3, 2007

TO:	Honorable Dianne White Delisi, Chair, House Committee on Public Health
FROM:	John S. O'Brien, Director, Legislative Budget Board
IN RE:	HB3064 by Delisi (Relating to registration and regulation of certain discount health plans; providing penalties.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for HB3064, As Introduced: an impact of $0 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.

General Revenue-Related Funds, Five-Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2008	$0
2009	$0
2010	$0
2011	$0
2012	$0

All Funds, Five-Year Impact:

Fiscal Year	Probable Savings/(Cost) from GENERAL REVENUE FUND 1	Probable Revenue Gain/(Loss) from GENERAL REVENUE FUND 1
2008	($279,074)	$279,074
2009	($253,986)	$253,986
2010	($254,187)	$254,187
2011	($254,305)	$254,305
2012	($254,258)	$254,258

Fiscal Year	Change in Number of State Employees from FY 2007
2008	4.0
2009	4.0
2010	4.0
2011	4.0
2012	4.0

Fiscal Analysis

The bill would amend the Health and Safety Code and the Business and Commerce Code relating to discount health care programs.  The bill would provide the Department of Licensing and Regulation (TDLR) the authority to register and regulate discount health care programs, including the authority to collect registration fees and provide disciplinary action and penalties.  The bill would require that a discount health program to pay TDLR an initial registration fee of no more than $200.

With respect to discount health care programs, the bill would prohibit false or misleading advertising, detail disclosure requirements, detail the duties of the program operator, the marketing of the program, and the contract requirements.

The bill would take effect September 1, 2007.

Methodology

Based on information provided by TDLR, this analysis assumes that 50 discount health care programs would choose to register with TDLR.

It is estimated that TDLR would have a cost associated with registering and regulating discount health care programs.  Based on the analysis of TDLR, it is assumed that registering these programs and regulating this industry would necessitate additional resources at a cost of $533,060 through 2009.
 
TDLR also estimates costs for staff of $187,248 for 4.0 FTEs in each fiscal year from 2008 through fiscal year 2012.  Other operating expenses, travel, and equipment are estimated at $38,854 in fiscal year 2008, $13,766 in fiscal year 2009, $13,967 in fiscal year 2010, $14,085 in fiscal year 2011, and $14,038 in fiscal year 2012.  Estimated costs also include $52,972 in each fiscal year from 2008 through fiscal year 2012 for associated benefits.

Although TDLR assumes that $10,000 (50 times $200 fee) in revenue from the initial registration fee would be collected from the discount health care programs, this analysis assumes that the agency would generate sufficient revenues to cover the total program operation costs.

Based on information provided from the Office of the Attorney General, it is assumed that any costs related to the duties and responsibilities associated with implementing the provisions of the bill could be covered by utilizing existing resources.

Technology

Technology costs for TDLR are estimated to be $11,454 in fiscal year 2008, $766 in fiscal year 2009, $967 in fiscal year 2010, $1,085 in fiscal year 2011, and $1,038 in fiscal year 2012.

Local Government Impact

No fiscal implication to units of local government is anticipated.

Source Agencies:

302 Office of the Attorney General, 452 Department of Licensing and Regulation

LBB Staff:

JOB, CL, MW, AH