LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 82ND LEGISLATIVE REGULAR SESSION May 10, 2011 TO: Honorable Jane Nelson, Chair, Senate Committee on Health & Human Services FROM: John S O'Brien, Director, Legislative Budget Board IN RE:HB1983 by Kolkhorst (Relating to certain childbirths occurring before the 39th week of gestation.), As Engrossed Estimated Two-year Net Impact to General Revenue Related Funds for HB1983, As Engrossed: a positive impact of $1,809,251 through the biennium ending August 31, 2013. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 82ND LEGISLATIVE REGULAR SESSION
May 10, 2011
TO: Honorable Jane Nelson, Chair, Senate Committee on Health & Human Services FROM: John S O'Brien, Director, Legislative Budget Board IN RE:HB1983 by Kolkhorst (Relating to certain childbirths occurring before the 39th week of gestation.), As Engrossed
TO: Honorable Jane Nelson, Chair, Senate Committee on Health & Human Services
FROM: John S O'Brien, Director, Legislative Budget Board
IN RE: HB1983 by Kolkhorst (Relating to certain childbirths occurring before the 39th week of gestation.), As Engrossed
Honorable Jane Nelson, Chair, Senate Committee on Health & Human Services
Honorable Jane Nelson, Chair, Senate Committee on Health & Human Services
John S O'Brien, Director, Legislative Budget Board
John S O'Brien, Director, Legislative Budget Board
HB1983 by Kolkhorst (Relating to certain childbirths occurring before the 39th week of gestation.), As Engrossed
HB1983 by Kolkhorst (Relating to certain childbirths occurring before the 39th week of gestation.), As Engrossed
Estimated Two-year Net Impact to General Revenue Related Funds for HB1983, As Engrossed: a positive impact of $1,809,251 through the biennium ending August 31, 2013. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
Estimated Two-year Net Impact to General Revenue Related Funds for HB1983, As Engrossed: a positive impact of $1,809,251 through the biennium ending August 31, 2013.
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 2012 $617,672 2013 $1,191,579 2014 $1,193,539 2015 $1,193,539 2016 $1,193,539
2012 $617,672
2013 $1,191,579
2014 $1,193,539
2015 $1,193,539
2016 $1,193,539
All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 Probable Savings/(Cost) fromFederal Funds555 2012 $617,672 $869,908 2013 $1,191,579 $1,608,841 2014 $1,193,539 $1,606,881 2015 $1,193,539 $1,606,881 2016 $1,193,539 $1,606,881
Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 Probable Savings/(Cost) fromFederal Funds555 2012 $617,672 $869,908 2013 $1,191,579 $1,608,841 2014 $1,193,539 $1,606,881 2015 $1,193,539 $1,606,881 2016 $1,193,539 $1,606,881
2012 $617,672 $869,908
2013 $1,191,579 $1,608,841
2014 $1,193,539 $1,606,881
2015 $1,193,539 $1,606,881
2016 $1,193,539 $1,606,881
Fiscal Analysis
SECTION 1 of the bill would require the Health and Human Services Commission (HHSC) to achieve cost savings by implementing certain initiatives designed to reduce the number of elective or nonmedically indicated induced deliveries or cesarean sections performed at a hospital on a Medicaid recipient before the 39th week of gestation. HHSC would be required to coordinate with certain entities to develop a process for collecting information regarding certain deliveries under the Medicaid program. SECTION 3 of the bill would require HHSC to conduct a study to assess the effects of quality initiatives related to certain deliveries; a written report would be required by December 1, 2012.
SECTION 1 of the bill would require the Health and Human Services Commission (HHSC) to achieve cost savings by implementing certain initiatives designed to reduce the number of elective or nonmedically indicated induced deliveries or cesarean sections performed at a hospital on a Medicaid recipient before the 39th week of gestation. HHSC would be required to coordinate with certain entities to develop a process for collecting information regarding certain deliveries under the Medicaid program.
SECTION 3 of the bill would require HHSC to conduct a study to assess the effects of quality initiatives related to certain deliveries; a written report would be required by December 1, 2012.
Methodology
SECTION 1: Provisions of the bill would require changes to the Medicaid claims payment system estimated to cost $57,000 in fiscal year 2012. According to HHSC, prohibiting reimbursement for all nonmedically indicated cesarean sections (not just those occurring prior to 39 weeks gestation) would result in an estimated savings of $1.1 million in fiscal year 2012 and $2.3 million in fiscal year 2013 and subsequent years. Prohibiting reimbursement for elective induction prior to 39 weeks gestation is assumed to delay earlier births and reduce birth complications and utilization of neonatal intensive care units. Savings are estimated to be $0.5 million in fiscal year 2012 and subsequent years. SECTION 3: HHSC estimates a cost of $0.1 million in fiscal year 2012 to complete the study and prepare the written report.
SECTION 1: Provisions of the bill would require changes to the Medicaid claims payment system estimated to cost $57,000 in fiscal year 2012. According to HHSC, prohibiting reimbursement for all nonmedically indicated cesarean sections (not just those occurring prior to 39 weeks gestation) would result in an estimated savings of $1.1 million in fiscal year 2012 and $2.3 million in fiscal year 2013 and subsequent years. Prohibiting reimbursement for elective induction prior to 39 weeks gestation is assumed to delay earlier births and reduce birth complications and utilization of neonatal intensive care units. Savings are estimated to be $0.5 million in fiscal year 2012 and subsequent years.
SECTION 3: HHSC estimates a cost of $0.1 million in fiscal year 2012 to complete the study and prepare the written report.
Technology
One-time costs for modifications to the Medicaid claims payment system are estimated to be $57,000 in fiscal year 2012.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: 529 Health and Human Services Commission, 304 Comptroller of Public Accounts
529 Health and Human Services Commission, 304 Comptroller of Public Accounts
LBB Staff: JOB, CL, LR, MB, NB
JOB, CL, LR, MB, NB