COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 0888-02
Bill No.: SB 338
Subject: Certificate of Need; Elderly; Health, Public; Nursing and Boarding Homes
Type: Original
Date: March 7, 2003
FISCAL SUMMARY
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| General Revenue | Unknown greater than $38,530 | Unknown greater than $38,530 | Unknown greater than $38,530 |
| Total Estimated
Net Effect on General Revenue Fund |
Unknown greater than $38,530 | Unknown greater than $38,530 | Unknown greater than $38,530 |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on Other State Funds |
$0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 4 pages.
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Federal* | $0 | $0 | $0 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
*Income and expenses of unknown but greater than $61, 470 would net to $0.
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Local Government | $0 | $0 | $0 |
ASSUMPTION
Officials from the Department of Mental Health and the Department of Health and Senior Services assume this proposal would not fiscally impact their agencies.
Officials from the Missouri Health Facilities Review Committee (MHFRC) state that the fiscal impact on General Revenue is minimal since the moratorium expired December 31, 2002. MHFRC states most of the proposals received to date were non-applicability applications for which there is no application fee.
Officials from the Department of Social Services - Division of Medical Services (DMS) state since the moratorium has expired nothing shall prevent a certificate of need (CON) from being issued for additional beds in existing facilities or new beds from being constructed, provided construction does not being prior to January 1, 2004. The DMS estimates that this proposed legislation will generate a cost avoidance to the Medicaid program. This is based on the assumption that new construction and facilities with new additions receive a higher per diem. Current regulation allows for a rate adjustment because of the addition of beds. For example, the average per diem increase for newly constructed beds has been $2.39. For a 100-bed facility with total occupancy at 75% and 60% of the residents Medicaid, the annual Medicaid patient ASSUMPTION (continued)
days would be 16,425. The above percentages are approximate statewide averages. The 16,425 Medicaid days multiplied by $2.39 would result in an additional $39,256 Medicaid expenditure. If only four (4) facilities with 100 beds or a total of 400 beds were constructed, the additional Medicaid expenditure would be $157,024. Therefore, the DMS believes the cost avoidance would be unknown but greater than $100,000.
| FISCAL IMPACT - State Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| GENERAL REVENUE | |||
| Cost Avoidance - Department of Social Services - Division of Medical Services | Unknown greater than $38,530 | Unknown greater than $38,530 | Unknown greater than $38,530 |
| ESTIMATED NET EFFECT ON GENERAL REVENUE | UNKNOWN GREATER THAN $38,530 | UNKNOWN GREATER THAN $38,530 | UNKNOWN GREATER THAN $38,530 |
| FEDERAL | |||
| Cost Avoidance - Department of Social Services - Division of Medical Services | |||
| Program costs | Unknown greater than $61,470 | Unknown greater than $61,470 | Unknown greater than $61,470 |
| Loss - Department of Social Services - Division of Medical Services | |||
| Federal Assistance | (Unknown greater than $61,470) | (Unknown greater than $61,470) | (Unknown greater than $61,470) |
| ESTIMATED NET EFFECT ON FEDERAL FUNDS |
$0 |
$0 |
$0 |
| FISCAL IMPACT - Local Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| $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 restores the moratorium on the expenditure minimum for beds in long-term care facilities until January 1, 2007.
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 Social Services
Missouri Health Facilities Review Committee
Department of Health and Senior Services
Department of Mental Health
Mickey Wilson, CPA
Director
March 7, 2003