This Fiscal Note is not an official copy and should not be quoted or cited.
This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0503 - Allows psychologists to prescribe medications in certain situations
COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO.: 2169-01
BILL NO.: SB 503
SUBJECT: Allows Psychologists to Prescribe Medications
TYPE: Original
DATE: March 22, 1999
FISCAL SUMMARY
|
ESTIMATED NET EFFECT ON STATE FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| General Revenue | ($1,901,392) | ($2,375,170) | ($2,470,536) |
| Psychology | $0 | $0 | $0 |
| Healing Arts | ($7,382) | ($6,979) | ($7,758) |
| Pharmacy | ($7,382) | ($6,979) | ($7,758) |
| Total Estimated
Net Effect on All State Funds |
($1,916,156) | ($2,289,128) | ($2,486,052) |
|
ESTIMATED NET EFFECT ON FEDERAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| Federal | ($2,927,269) | ($3,653,231) | ($3,799,361) |
| Total Estimated
Net Effect on All Federal Funds |
($2,927,269) | ($3,653,231) | ($3,799,361) |
|
ESTIMATED NET EFFECT ON LOCAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| Local Government | $0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses
This fiscal note contains 7 pages.
FISCAL ANALYSIS
ASSUMPTION
Officials from the Department of Conservation assume that this proposal will not fiscally affect their insurance plan.
Officials from the Missouri Consolidated Health Care Plan (MCHCP) stated that allowing a provider group to provide a new service will add some 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 (psychologist) to write prescriptions would simply shift costs among provider types. Consequently, it would be expected that any overall cost increase would be minimal.
Oversight assumes that any cost increases could be absorbed with existing resources.
Officials from the Department of Public Safety - Missouri Highway Patrol (MHP) assume that this proposal would not fiscally affect the patrol. Until the number of psychologists licensed to prescribe drugs is known, the patrol cannot estimate the fiscal impact on the patrol's insurance plan.
Officials from the Department of Transportation (MoDOT) assume a minimal fiscal impact because this proposal may require an increase in the state share of the medical plan for the increased drug prescriptions.
Oversight notes that neither the MHP nor the MoDOT officials provided an estimate of the impact on their insurance plans. Oversight notes that the Missouri Consolidated Health Care Plan assumes minimum impact related to this proposal. Since the MCHCP provides insurance coverage to a much larger group of state employees, Oversight assumes the HWP and MoDOT insurance plans can absorb any increase in costs resulting from this proposal.
Officials from the Department of Health (DOH) assume any licensed psychologist wishing to have authority to prescribe, stock or administer controlled substances would need to apply for a Missouri Controlled Substances Registration which includes a $30 registration fee. There are over 1600 psychologists licensed to practice in Missouri. The State Committee of Psychologists estimates that approximately 550 psychologists wish to become certified to prescribe controlled substance medications. Fee revenues would total $16,500 (550 X $30). Oversight notes that the Department of Economic Development stated that only 300 psychologists would become licensed. Therefore, Oversight has reduced the fee revenue to $9,000 (300 x $30). These revenues would be deposited into the General Revenue Fund.
ASSUMPTION (continued)
In addition, the Bureau of Narcotics and Dangerous Drugs (BNDD) would need to maintain a registry of any psychologist wishing to register for controlled substance authority. These psychologists could be inspected for compliance with controlled substance laws. If evidence is found that an individual was in violation, an administrative action may be taken as well as referred to law enforcement if appropriate for criminal investigation.
Using historical averages, the BNDD would inspect or investigate an average of 15 psychologists (out of 550) per year for compliance with controlled substance laws. The average cost for the BNDD to conduct an inspection or investigation is $175. Using statistical averages, 10 administrative actions would be required (out of the 15 inspections/investigations). The average departmental costs associated with an administrative action are $790. This would not require an FTE, yet the associated costs of dealing with this many more registrants would cost the (BNDD) an additional $10,525 which could be absorbed in the core budget. The passage of more than one similar proposal may require the department to request increased appropriation to cover cumulative inspection and administrative costs.
Officials from the Department of Mental Health (DMH) stated that they and the Department of Social Services would need to revise Purchase of Service and Medicaid regulations to allow for billing. Hospital bylaws will need to be rewritten. Pharmacies around the state will need to track separate formulary lists for psychologists. These responsibilities will be absorbed by existing staff.
The DMH believes there will be an increase in medication costs due to the shifting of written prescriptions from psychiatrists to psychologists and an increased number of individuals prescribing medications. However, the DMH is unable to project a percent of psychologists at DMH owned and community providers who would prescribe medications.
Officials from the Department of Social Services - Division of Medical Services (DMS) stated 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. This proposal, if passed, would allow psychologists to prescribe certain drugs. Increasing the number of providers able to prescribe drugs is likely to increase the number of prescriptions. This is due in part to the greater access of Medicaid recipients to providers able to write prescriptions.
To compute the fiscal impact, DMS assumed the psychologists would prescribe the drugs similar to psychiatrists. DMS determined the average monthly expenditure for the type of drugs that psychologists should be able to prescribe was $1,424,676. There are 915 enrolled psychiatrists.
ASSUMPTION (continued)
Therefore, the average monthly pharmacy expenditures for these type of drugs prescribed by each psychiatrist is $1,557 ($1,424,676 / 915). There are 3,107 psychologists enrolled as Medicaid providers. If psychologists prescribed the same amount of drug claims as psychiatrists, the additional monthly costs would be $4,837,599 ($1,557 x 3,107). The additional average yearly cost would be $58,051,188 ($4,837,599 x 12).
DMS assumed a conservative estimate that psychologists would prescribe 10% of the drugs that psychiatrists prescribe. The fiscal impact based on this assumption in the first full year will be $5,805,118 ($58,051,188 x 10%). The impact in FY 00 was prorated to 10 months. An inflation rate of 4% was assumed for FY 01 and FY 02. These costs were split between state and federal funds at a rate of 39.5 % state and 60.5 % federal funds. In previous fiscal notes for similar proposals, Oversight offset the federal share of these expenditures with income from the federal government at the same amount. For this fiscal note, Oversight is reflecting only the expenditures charged to the federal funds.
Officials from the Department of Economic Development - Division of Professional Registration (DPR) assume they will be fiscally impacted by this proposal.
Revenues:
The State Committee of Psychologists estimates that approximately 300 licensed psychologists will apply to the committee for prescribing authority. A 3% growth rate has been estimated as well. Fees have been set a level sufficient to produce revenue to fund the estimated expenditures. All fees received by the committee will be deposited into the Psychology Fund. The DPR estimates fees of $45 per license for 300 licensees. The fee is biennial. Oversight calculated fee revenues for the Psychology Fund of $13,500, $405, and $14,310 for Fiscal Years 2000, 2001, and 2002, respectively.
Costs
The DPR stated the Psychology Fund will reimburse the Professional Registration Fees Fund for the necessary personal service and expense and equipment costs necessary to implement this proposal. Oversight has elected to present the estimated revenues and personal services costs from the Psychology Fund and not the related transfers to the Professional Registration Fees Fund.
ASSUMPTION (continued)
The DPR assumed that the State Committee on Psychologists, the Board of Registration for the Healing Arts, and the Board of Pharmacy will meet to jointly promulgate rules establishing a formulary of drugs which may be prescribed by psychologists in systemic pathopsychology. It is estimated that 4 members from each board will have 2 meetings for 2 days, per year, in Jefferson City to establish and maintain the drug formulary. The DPR estimates total travel expenses at $7,507 per year for the board members. This includes mileage, lodging, and meal expenses.
Each board member is to receive a $50 per diem, which totals $2,400 per year. The DPR assumed the Office of Attorney General will provide approximately 32 hours of assistance per year, per board, for help with rules, opinions, and meetings. This totaled $3,714 for both boards. Printing and postage costs for the first year was estimated at $1,143.
Oversight assumes the DPR can absorb the costs of printing and postage for FY 01. Oversight assumes a cost of $1,212 for printing and postage for FY 02. Oversight totaled the costs provided by the DPR for the board costs and split them equally between the Healing Arts Fund and the Pharmacy Fund.
The DPR assumed existing staff would design, program, and implement a computer licensure program. Therefore, no additional costs are anticipated for this portion in implementing the proposal. The DPR assumes a national examination will be utilized for examinations. However, if the board elects to develop its own examination the cost is estimated to be between $10,000 and $50,000. It is assumed the examination fee will be paid directly to the testing service by the exam applicant. No revenues or costs are associated with the examination aspect of the proposal.
| FISCAL IMPACT - State Government | FY 2000 | FY 2001 | FY 2002 |
| (10 Mo.) | |||
| GENERAL REVENUE FUND | |||
| Revenue - Department of Health | |||
| $30 Registration Fee | $9,000 | $9,000 | $9,000 |
| Costs - Department of Social Services (DOSS) - | |||
| Division of Medical Services | |||
| Increased Assistance Payments | ($1,910,392) | ($2,384,170) | ($2,479,536) |
|
ESTIMATED NET EFFECT | |||
| GENERAL REVENUE FUND | ($1,901,392) | ($2,375,170) | ($2,470,536) |
| FISCAL IMPACT - State Government | FY 2000 | FY 2001 | FY 2002 |
| (continued) | (10 Mo.) | ||
| PSYCHOLOGY FUND | |||
| Revenue - Department of Economic Development - | |||
| Division of Professional Registration (DPR) | |||
| License Revenue | $13,500 | $405 | $14,310 |
| Costs - DPR | |||
| Personal Service and Expense and Equipment | ($13,500) | ($405) | ($14,310) |
|
ESTIMATED NET EFFECT ON | |||
| THE PSYCHOLOGY FUND | $0 | $0 | $0 |
| HEALING ARTS FUND | |||
| Costs - DPR | |||
| Travel, Attorney General Staff Costs, | |||
| and Printing Expenses | ($7,382) | ($6,979) | ($7,758) |
|
ESTIMATED NET EFFECT ON THE | |||
| HEALING ARTS FUND | ($7,382) | ($6,979) | ($7,758) |
| PHARMACY FUND | |||
| Costs - DPR | |||
| Travel, Attorney General Staff Costs, | |||
| and Printing Expenses | ($7,382) | ($6,979) | ($7,758) |
|
ESTIMATED NET EFFECT ON | |||
| THE PHARMACY FUND | ($7,382) | ($6,979) | ($7,758) |
| FEDERAL FUNDS | |||
| Costs - DOSS - Division of Medical Services | |||
| Increased Assistance Payments | ($2,927,269) | ($3,653,231) | ($3,799,361) |
|
ESTIMATED NET EFFECT | |||
| FEDERAL FUNDS | ($2,927,269) | ($3,653,231) | ($3,799,361) |
| FISCAL IMPACT - Local Government | FY 2000 | FY 2001 | FY 2002 |
| (10 Mo.) | |||
| $0 | $0 | $0 | |
| FISCAL IMPACT - Small Business | |||
| No direct fiscal impact to small businesses would be expected as a result of this proposal. | |||
DESCRIPTION
This proposal allows psychologists to prescribe medications in certain situations. It allows 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 psychological problems and emotional and mental disorders and illnesses.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Economic Development - Division of Professional Registration
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 Highway Patrol
Jeanne Jarrett, CPA
Director
March 22,1999