Honorable Lois W. Kolkhorst, Chair, Senate Committee on Health & Human Services
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
SB1275 by Hancock (Relating to facility fees charged by certain health care providers; providing an administrative penalty.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for SB1275, As Introduced : a negative impact of ($3,871,914) through the biennium ending August 31, 2025. According to the Health and Human Services Commission (HHSC), certain provisions of the bill may result in Medicaid offsets that could result in cost savings to the State.
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
2024
($2,122,897)
2025
($1,749,017)
2026
($1,749,551)
2027
($1,750,091)
2028
($1,750,637)
All Funds, Five-Year Impact:
Fiscal Year
Probable (Cost) from General Revenue Fund 1
Change in Number of State Employees from FY 2023
2024
($2,122,897)
6.0
2025
($1,749,017)
6.0
2026
($1,749,551)
6.0
2027
($1,750,091)
6.0
2028
($1,750,637)
6.0
Fiscal Analysis
The bill would prohibit the charging of certain facility fees by specific health care providers. The Department of State Health Services (DSHS) would be required to receive reports and collect data regarding facility fees charged by health care providers subject to the bill.
The bill would authorize DSHS to audit health care providers regarding compliance to this chapter.
The bill would authorize DSHS to assess an administrative penalty of up to $1,000 against a health care provider that violates this chapter or a rule adopted under this chapter.
The bill would authorize the Health and Human Services Commission (HHSC) to adopt rules to implement the chapter.
Methodology
It is assumed that DSHS would require 6.0 full-time equivalents (FTEs) to administer requirements in the bill including Research Specialist IV positions (2.0 FTEs) to perform advance research work on emergency, inpatient, and outpatient claims data; a Program Specialist V position (1.0 FTE) to prepare, report, and disseminate data; a Quality Assurance IV position (1.0 FTE) to oversee the planning, development, and administration of internal quality assurance and compliance duties; a Customer Service Representative IV position (1.0 FTE) to coordinate customer service support, and a Manager IV position (1.0 FTE) to oversee and manage staff and duties required under the bill. Salary and benefits for these positions total $0.4 million for part of fiscal year 2024 and $0.6 million in fiscal year 2025. Additional FTE costs total $0.1 million in fiscal year 2024 and less than $0.1 million in fiscal year 2025.
According to DSHS, Urgent Care Centers (UCCs) would be a new facility type required to submit data to DSHS under the bill. The data collection vendor contract would need to be amended to include additional data elements to the existing system to reflect changes to the collection and processing of facility fee billing to the UCCs. The addition of approximately 1,245 UCCs would result in a vendor contract of $1.6 million including $0.5 million to modify the existing system in fiscal year 2024. Costs for the vendor contract would be $1.1 million in fiscal year 2025.
According to HHSC, rules would have to be adopted across multiple provider types, including Free-standing Emergency Medical Clinics, General and Special Hospitals, and Limited Services Rural Hospitals. HHSC would issue guidance to applicable provider types. Additional duties may include identifying which health care services may be safely and effectively provided outside a hospital setting and communicating the services to health care providers. It is assumed that any fiscal impact to HHSC can be absorbed within existing resources.
According to HHSC, certain provisions of the bill may result in Medicaid
offsets that could result in cost savings to the State.
The revenue impact of the bill is dependent upon the number of violations of the chapter that would result in administrative penalties, which is unknown. As a result, the revenue impact of implementing the provisions of the bill cannot be determined.
Technology
Additional Information Technology costs for the new FTEs total less than $0.1 million per fiscal year.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies:
304 Comptroller of Public Accounts, 529 Health and Human Services Commission, 537 State Health Services, Department of