SB 0549 - Fiscal Note

Fiscal Note - SB 0549 - Allows specified licensed psychologists to prescribe drugs

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 2482-01

BILL NO. SB 549

SUBJECT: Economic Development Department; Health Care Professionals; Mental Health; Drugs and Controlled Substances; Pharmacy; Physicians; Psychologists

TYPE: Original

DATE: January 22, 1998

---

FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
General Revenue	$16,500 to ($1,240,456)	$16,500 to ($1,552,181)	$16,500 to ($1,614,928)
Psychology	($3,307)	($3,382)	($3,460)
Healing Arts	($3,307)	($3,382)	($3,460)
Pharmacy	($3,307)	($3,382)	($3,460)
Total Estimated Net Effect on All State Funds	$6,579 to ($1,250,377)	$6,354 to ($1,562,327)	$6,120 to ($1,625,308)

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Federal funds	$0	$0	$0
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Local Government	$0	$0	$0

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 6 pages.

FISCAL ANALYSIS

ASSUMPTION

Officials from the Office of State Courts Administrator, the Office of Administration, the Office of Attorney General, the Office of Prosecution Services, the Department of Mental Health, the Department of Conservation, the State Public Defender, and the Department of Public Safety - Missouri State Highway Patrol assume this proposal would not fiscally impact their agencies.

Missouri Consolidated Health Care Plan (HCP) officials state that allowing a provider group to provide a new service would add some additional cost. However, the amount of increase would be very difficult to determine. Also the increase would be tempered because in many instances allowing this provider group to write prescriptions would simply shift costs among provider types. HCP further states that there may be some small offsets because members needing medication could obtain them from a lower cost provider group. HCP assumes that it would be expected that any overall cost increase would be minimal.

Officials from the Department of Transportation (DOT) assume a minimal impact because this proposal may require an increase in the state share to the medical plan for the increased drug prescriptions.

Department of Health (DOH) officials state there are over 1,600 psychologists licensed to practice in Missouri. DOH states the State Committee of Psychologists estimates that approximately 550 psychologists would wish to become certified to prescribe medications. DOH states these individuals would need to register with the Bureau of Narcotics and Dangerous Drugs if they wished to have authority for controlled substance medications (550 psychologists x $30 annual registration fee = $16,500 annually). DOH states that using statistical averages, the Bureau of Narcotics and Dangerous Drugs would inspect or investigate an average of fifteen psychologists per year for compliance with Missouri controlled substance laws. DOH states the average cost to conduct an inspection/investigation is $175 (annual cost of $2,625). DOH further states that using statistical averages, ten administrative actions would be required out of the fifteen inspections/investigations completed. DOH states the average departmental costs associated with an administrative action are $709 (annual cost of $7,900). DOH states this proposal would not require an additional FTE as these costs would be absorbed in the current budget. However, the passage of more than one similar proposal may require DOH to request increased appropriations to cover cumulative administrative costs.

Officials from the Department of Economic Development - Division of Professional Registration (DPR) state the American Psychological Association estimates that there would be ASSUMPTION (continued)

a national examination available by the time the applicants would complete the course study

requirements; therefore, DPR assumes that a national examination would be utilized by the Missouri State Committee of Psychologists. However, if no examination is in place upon the applicant's completion of the required course studies, additional personal services and expense and equipment dollars would be needed to develop an examination. DPR assumes that the

examination fee would be paid directly to the testing service by the exam applicant.

DPR assumes the Committee of Psychologists, the Board of Healing Arts, and the Board of Pharmacy would meet to jointly promulgate rules establishing a formulary of drugs which would be prescribed by psychologists in systemic pathopsychology. They would also be required to meet annually thereafter to update the list. DPR estimates that four members from each board would have two meetings for two days in Jefferson City to establish the list and to maintain it. DPR assumes that the members would arrive the evening before the meeting. Also, one staff member from each board would attend. DPR estimates that each board/committee member would drive an average of 240 miles round trip for two meetings for twelve members at $.285 per mile ($1,641 total mileage cost annually). DPR estimates that the hotel costs would be $75 per night for two nights for two meetings for twelve members ($3,600 total hotel costs annually). DPR estimates that meal costs would be $30 per day for two days for two meetings ($2,280 total meal costs annually). In addition, DPR assumes a per diem of $50 per day per board/committee member ($800 per diem cost per board/committee). DPR assumes a board/committee expense of $3,307. DPR assumes that a list of psychologists authorized to prescribe drugs would be available on the Internet for verification of eligibility.

Department of Social Services (DOS) officials state the Missouri Medicaid program is required by Section 208.152, RSMo, to make payments for drugs and medicines only when prescribed by a licensed physician, dentist, or podiatrist. DOS states this proposal would allow psychologists to prescribe certain drugs. Increasing the number of providers able to prescribe drugs would likely increase the number of prescriptions. This would be due in part to the greater access of Medicaid recipients to providers able to write prescriptions. For fiscal note purposes, DOS assumes that the psychologists would prescribe the drugs similar to psychiatrists. DOS has determined that the average monthly expenditure for the types of drugs that psychologists should be able to prescribe was $874,699. DOS has determined that there are 899 enrolled psychiatrists. DOS estimates the average monthly pharmacy expenditures for these types of drugs prescribed by each psychiatrist is $972.97 ($874,699/899). DOS states there are 3,250 psychologists enrolled as Medicaid providers. If psychologists prescribed the same amount of drug claims as psychiatrists, DOS estimates the additional monthly costs would be $3,162,153 ($972.97 x 3,250). The additional average yearly cost would be $37,945,836 ($3,612 x 12 months). However, DOS assumes a conservative estimate that psychologists would prescribe ten percent of the drugs that psychiatrists prescribe. Therefore, the fiscal impact based on this assumption in the first full year would be $3,794,584. DOS assumes an annual inflationary rate of four percent.

ASSUMPTION (continued)

Oversight assumes there would be some new costs due to the shifting of written prescriptions from psychiatrists to psychologists. Oversight has ranged the costs from $0 to $3,162,153 to reflect the potential increase in prescriptions of up to ten percent as a result of this proposal.

FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
	(10 Mo.)
GENERAL REVENUE FUND
Income - Department of Health
Annual registration fees	$16,500	$16,500	$16,500
Cost - Department of Social Services
Increase in medical assistance payments	$0 to	$0 to	$0 to
	($1,256,956)	($1,568,681)	($1,614,928)
ESTIMATED NET EFFECT ON
GENERAL REVENUE FUND	$16,500 to	$16,500 to	$16,500 to
	($1,240,456)	($1,552,181)	($1,614,928)
PSYCHOLOGY FUND
Costs - State Committee of Psychologists
Meeting expenses	($3,307)	($3,382)	($3,460)
ESTIMATE NET EFFECT ON
PSYCHOLOGY FUND	($3,307)	($3,382)	($3,460)
HEALING ARTS FUND
Costs - Board of Healing Arts
Meeting expenses	($3,307)	($3,382)	($3,460)
ESTIMATE NET EFFECT ON
HEALING ARTS FUND	($3,307)	($3,382)	($3,460)
PHARMACY FUND
Costs - Board of Pharmacy
Meeting expenses	($3,307)	($3,382)	($3,460)
FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
(continued)	(10 Mo.)
ESTIMATE NET EFFECT ON
PHARMACY FUND	($3,307)	($3,382)	($3,460)
FEDERAL FUNDS
Income - Department of Social Services
Medicaid reimbursements	$0 to	$0 to	$0 to
	$1,905,197	$2,377,686	$2,472,794
Costs - Department of Social Services
Increase in medical assistance payments	$0 to	$0 to	$0 to
	($1,905,197)	($2,377,686)	($2,472,794)
ESTIMATED NET EFFECT ON
FEDERAL FUNDS	$0	$0	$0
FISCAL IMPACT - Local Government	FY 1999	FY 2000	FY 2001
	(10 Mo.)
	$0	$0	$0
FISCAL IMPACT - Small Business

Small businesses would be expected to be fiscally impacted to the extent they would incur additional costs for licensure and additional revenue for new services due to the requirements of this proposal.

DESCRIPTION

This proposal would allow licensed psychologists approved by the State Committee of Psychologists to be certified to prescribe drugs and other medications necessary in the treatment of mental health disorders. When applying for this certification a licensed psychologist must provide evidence of completion of a pharmacology course, with at least 100 hours of approved clinical training and at least 200 hours of independent course study in the assessment of the need and prescription of drugs in the treatment of persons with psychologist problems and emotional and mental disorders and illnesses.

DESCRIPTION (continued)

This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space. It would affect Total State Revenues.

SOURCES OF INFORMATION

Department of Economic Development

Division of Professional Registration

Office of Prosecution Services

Office of Attorney General

Office of State Courts Administrator

State Public Defender

Department of Health

Department of Mental Health

Department of Social Services

Missouri Consolidated Health Care Plan

Department of Conservation

Department of Transportation

Department of Public Safety

Missouri State Highway Patrol

Office of Administration

Jeanne Jarrett, CPA

Director

January 22, 1998