Honorable Lois W. Kolkhorst, Chair, Senate Committee on Health & Human Services
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
SB2450 by Hughes (Relating to the participation and reimbursement of and requirements affecting certain providers, including providers of eye health care and vision care services, under Medicaid.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for SB2450, As Introduced: a negative impact of ($2,151,957) through the biennium ending August 31, 2027.
According to the Health and Human Services Commission (HHSC), the agency cannot estimate the degree to which the bill would require Medicaid managed care organizations to increase their rates paid to providers. Therefore, the fiscal implications of the bill to Medicaid client services cannot be determined.
General Revenue-Related Funds, Five- Year Impact:
Fiscal Year
Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2026
($1,020,868)
2027
($1,131,089)
2028
($1,131,419)
2029
($1,131,693)
2030
($1,131,974)
All Funds, Five-Year Impact:
Fiscal Year
Probable Savings/(Cost) from GR Match For Medicaid 758
Probable Savings/(Cost) from Federal Funds 555
Change in Number of State Employees from FY 2025
2026
($1,020,868)
($1,004,434)
2.0
2027
($1,131,089)
($1,273,512)
2.0
2028
($1,131,419)
($1,273,622)
2.0
2029
($1,131,693)
($1,273,714)
2.0
2030
($1,131,974)
($1,273,807)
2.0
Fiscal Analysis
The bill would require HHSC to ensure that Medicaid providers have access to a support team for the Internet portal through which providers may enroll in Medicaid. The bill would require HHSC to annually evaluate the performance of the support team, post the results of the evaluation on its website, and develop a procedure for Medicaid providers to submit complaints and feedback about enrollment and credentialing processes and support. The bill would establish notification and process requirements that HHSC must meet before disenrolling a Medicaid provider.
The bill would require Medicaid managed care organizations to reimburse eye care providers at a rate equal to or greater than the Medicaid fee-for-service rate for the same or similar services. The bill would prohibit certain contracting practices for the provision of eye health care or vision care under Medicaid managed care and amend network requirements relating to eye health providers under Medicaid managed care.
Methodology
This analysis assumes that HHSC would require additional resources for Texas Medicaid and Healthcare Partnership (TMHP) contract needs, including funding for 14 additional vendor staff for the provider enrollment support team, postage costs related to new provider disenrollment requirements, and updates to policies, procedures, and resources. This additional need is estimated to total $1,562,352 from All Funds in each fiscal year.
According to HHSC, 2.5 additional full-time equivalents (FTEs) would be needed to conduct activities required by the bill, including assistance with and resolution of provider complaints and escalations, monitoring and evaluation of the provider enrollment support team, and indirect support. This analysis assumes a total of 2.0 FTEs would be needed, including 1.0 Contract Specialist position and 1.0 Program Specialist position, in fiscal years 2026 through 2030. Personnel-related costs, including salaries, travel, and overhead are estimated to total $297,533 from All Funds in fiscal year 2026 and $278,701 from All Funds in fiscal year 2027.
This analysis assumes that HHSC would require additional resources related to one-time modifications to the Provider Enrollment Management System (PEMS) and ongoing additional workload managed through PEMS. This additional need is estimated to total $165,417 from All Funds in fiscal year 2026 and $563,548 from All Funds in fiscal year 2027.
According to HHSC, the agency cannot estimate the degree to which the bill would require Medicaid managed care organizations to increase their rates paid to providers. Therefore, the fiscal implications of the bill to Medicaid client services cannot be determined.
Technology
Included in the amounts above, the total non-FTE-related technology cost is estimated to be $165,417 from All Funds in fiscal year 2026 and $563,548 from All Funds in fiscal year 2027.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.