Bill Caption

Relating to improving the delivery and quality of certain health and human services, including the delivery and quality of Medicaid acute care services and long-term care services and supports.

Fiscal Notes

Estimated Two-year Net Impact to General Revenue Related Funds for SB7, Committee Report 2nd House, Substituted: a positive impact of $6,129,914 through the biennium ending August 31, 2015. There are a number of provisions in the bill, particularly in ARTICLEs 4 through 7, that could have significant cost or savings, but the amounts cannot be determined and are not reflected in the positive impact. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.

Bill Analysis

Summary: SB 7 seeks to drastically reform various parts of Texas’ Medicaid system, such as by testing strategies to coordinate long term and acute care services, redesigning long-term care service for intellectually and developmentally disabled patients, and expanding the practice of quality-based payment in Medicaid. For instance, SB 7 would allow for the creation of pilot programs to test managed care strategies based on capitation that would emphasize finding private providers to spearhead reforms. SB 7 would address payment reform, for instance, by requiring Health and Human Services Commission (HHSC) to require Managed Care Organizations (MCO) to develop quality based payment systems. These are only a few of the specific provisions of SB 7 that seek to bring more efficiency to Texas’ Medicaid.

Analysis: The goals of SB 7 are laudable. Making Medicaid more efficient and less costly is good for taxpayers and good for patients dependent upon Medicaid. However, SB 7 would also require an expansion in government in order to find out whether or not these reforms will work. Texas has to try something to reform its Medicaid system, which is consuming a quarter of the state budget and growing. The Legislative Budget Board does predict a $6 million cost savings for taxpayers through 2015. This legislation is great for Texas taxpayers. We support SB 7.