LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 26, 2025 TO: Honorable Jay Dean, Chair, House Committee on Insurance FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB1464 by Talarico (relating to a prescription drug purchasing pool for certain health benefit plan issuers and employers.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for HB1464, Committee Report 1st House, Substituted: a negative impact of ($3,395,500) through the biennium ending August 31, 2027. 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 toGeneral Revenue Related Funds2026($711,657)2027($2,683,843)2028($4,684,503)2029($4,685,052)2030($4,685,613)All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 Change in Number of State Employees from FY 20252026($711,657)3.02027($2,683,843)3.02028($4,684,503)3.02029($4,685,052)3.02030($4,685,613)3.0 Fiscal AnalysisThis bill amends the Health and Safety Code to establish a prescription drug purchasing pool through which a participating health benefit plan issuer or qualified public or private employers could purchase prescription drugs for their employees, employees' dependents, and retirees from vendors at a discounted rate or under terms negotiated by the Health and Human Services Commission (HHSC). This bill would take effect September 1, 2025.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 26, 2025
TO: Honorable Jay Dean, Chair, House Committee on Insurance FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB1464 by Talarico (relating to a prescription drug purchasing pool for certain health benefit plan issuers and employers.), Committee Report 1st House, Substituted
TO: Honorable Jay Dean, Chair, House Committee on Insurance
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: HB1464 by Talarico (relating to a prescription drug purchasing pool for certain health benefit plan issuers and employers.), Committee Report 1st House, Substituted
Honorable Jay Dean, Chair, House Committee on Insurance
Honorable Jay Dean, Chair, House Committee on Insurance
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
HB1464 by Talarico (relating to a prescription drug purchasing pool for certain health benefit plan issuers and employers.), Committee Report 1st House, Substituted
HB1464 by Talarico (relating to a prescription drug purchasing pool for certain health benefit plan issuers and employers.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for HB1464, Committee Report 1st House, Substituted: a negative impact of ($3,395,500) through the biennium ending August 31, 2027. 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 HB1464, Committee Report 1st House, Substituted: a negative impact of ($3,395,500) through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
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:
2026 ($711,657)
2027 ($2,683,843)
2028 ($4,684,503)
2029 ($4,685,052)
2030 ($4,685,613)
All Funds, Five-Year Impact:
2026 ($711,657) 3.0
2027 ($2,683,843) 3.0
2028 ($4,684,503) 3.0
2029 ($4,685,052) 3.0
2030 ($4,685,613) 3.0
Fiscal Analysis
This bill amends the Health and Safety Code to establish a prescription drug purchasing pool through which a participating health benefit plan issuer or qualified public or private employers could purchase prescription drugs for their employees, employees' dependents, and retirees from vendors at a discounted rate or under terms negotiated by the Health and Human Services Commission (HHSC). This bill would take effect September 1, 2025.
Methodology
HHSC assumes the agency would be required to implement various administrative tasks associated with the establishment and implementation of the prescription drug purchasing pool. This analysis assumes HHSC would require $711,657 from the General Revenue Fund ($711,657 from All Funds) and 1.0 Director II, 1.0 Director IV, and 1.0 Pharmacist II full-time-equivalents (FTEs) in fiscal year 2026 and $2,683,843 from the General Revenue Fund ($2,683,843 from All Funds) and 1.0 Director II, 1.0 Director IV, and 1.0 Pharmacist II FTEs in fiscal year 2027 to implement the provisions of the bill, which include establishing the eligibility criteria for participation in the pool; determining the enrollment, disenrollment, and eligibility termination processes; configuring how participants momentarily contribute to the purchasing pool; and provide the necessary oversight for contracts, procurement, and administration of the purchasing pool. Included in the amounts above are assumed FTE costs totaling $711,657 from the General Revenue Fund ($711,657 from All Funds) in fiscal year 2026 and $683,843 from the General Revenue Fund ($683,843 from All Funds) in fiscal year 2027, including $29,082 from the General Revenue Fund ($29,082 from All Funds) in fiscal year 2026 for one-time costs related to the implementation of provisions of this bill.Additionally, HHSC assumes a significant portion of the procurement process would not be completed until fiscal year 2027, and therefore the agency would require $2,000,000 from the General Revenue Fund ($2,000,000 from All Funds) in fiscal year 2027 associated with training costs related to the procurement process to establish and maintain the purchasing pool. Starting in fiscal year 2028, HHSC assumes the procurement process will be completed, and the associated training costs would be $4,000,000 from the General Revenue Fund each fiscal year going forward.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: b > td > 529 Health and Human Services Commission
529 Health and Human Services Commission
LBB Staff: b > td > JMc, AAL, ER, LBl, NV
JMc, AAL, ER, LBl, NV