LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION April 14, 2009 TO: Honorable John T. Smithee, Chair, House Committee on Insurance FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB861 by Naishtat (Relating to the authority of certain university systems to provide benefits to certain qualified individuals.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB861, As Introduced: an impact of $0 through the biennium ending August 31, 2011.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
April 14, 2009
TO: Honorable John T. Smithee, Chair, House Committee on Insurance FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB861 by Naishtat (Relating to the authority of certain university systems to provide benefits to certain qualified individuals.), As Introduced
TO: Honorable John T. Smithee, Chair, House Committee on Insurance
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: HB861 by Naishtat (Relating to the authority of certain university systems to provide benefits to certain qualified individuals.), As Introduced
Honorable John T. Smithee, Chair, House Committee on Insurance
Honorable John T. Smithee, Chair, House Committee on Insurance
John S. O'Brien, Director, Legislative Budget Board
John S. O'Brien, Director, Legislative Budget Board
HB861 by Naishtat (Relating to the authority of certain university systems to provide benefits to certain qualified individuals.), As Introduced
HB861 by Naishtat (Relating to the authority of certain university systems to provide benefits to certain qualified individuals.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB861, As Introduced: an impact of $0 through the biennium ending August 31, 2011.
Estimated Two-year Net Impact to General Revenue Related Funds for HB861, As Introduced: an impact of $0 through the biennium ending August 31, 2011.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2010 $0 2011 $0 2012 ($16,245,000) 2013 ($17,670,000) 2014 ($19,000,000)
2010 $0
2011 $0
2012 ($16,245,000)
2013 ($17,670,000)
2014 ($19,000,000)
All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 2010 $0 2011 $0 2012 ($16,245,000) 2013 ($17,670,000) 2014 ($19,000,000)
Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 2010 $0 2011 $0 2012 ($16,245,000) 2013 ($17,670,000) 2014 ($19,000,000)
2010 $0
2011 $0
2012 ($16,245,000)
2013 ($17,670,000)
2014 ($19,000,000)
Fiscal Analysis
The bill would authorize the Texas A&M University System and The University of Texas System to expand the group health insurance eligibility for dependent coverage. Currently, only spouses and children are eligible to participate as dependents in each system's group health insurance program.
The bill would authorize the Texas A&M University System and The University of Texas System to expand the group health insurance eligibility for dependent coverage. Currently, only spouses and children are eligible to participate as dependents in each system's group health insurance program.
Methodology
While neither system has indicated it will use the authority granted by the bill to expand eligibility for dependent coverage, both systems did provide cost estimates showing the fiscal effect of a 10 percent increase in dependent coverage enrollment in their respective group health insurance programs. These estimates assume a 10 percent increase in enrollment in 2010, plus 7 to 8 percent compounded rate increases in each out year. The estimates provided by the systems have been prorated to reflect the state's current contribution level for group health insurance. For The University of Texas and Texas A&M University systems, the state currently funds 95 percent of the full cost of premiums. In addition, the enrollment data used to generate group health insurance contributions for fiscal years 2010 and 2011 has already been submitted earlier this year. As such, any increase in cost due to the bill would not be captured by the state until the 2012-13 biennium. Until the state counts the new participants in the next enrollment census, the cost increase would have to be paid with institutional funds.
While neither system has indicated it will use the authority granted by the bill to expand eligibility for dependent coverage, both systems did provide cost estimates showing the fiscal effect of a 10 percent increase in dependent coverage enrollment in their respective group health insurance programs. These estimates assume a 10 percent increase in enrollment in 2010, plus 7 to 8 percent compounded rate increases in each out year.
The estimates provided by the systems have been prorated to reflect the state's current contribution level for group health insurance. For The University of Texas and Texas A&M University systems, the state currently funds 95 percent of the full cost of premiums.
In addition, the enrollment data used to generate group health insurance contributions for fiscal years 2010 and 2011 has already been submitted earlier this year. As such, any increase in cost due to the bill would not be captured by the state until the 2012-13 biennium. Until the state counts the new participants in the next enrollment census, the cost increase would have to be paid with institutional funds.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 710 Texas A&M University System Administrative and General Offices, 720 The University of Texas System Administration
710 Texas A&M University System Administrative and General Offices, 720 The University of Texas System Administration
LBB Staff: JOB, KJG, RT, JAW
JOB, KJG, RT, JAW