COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 2809-06
Bill No.: HCS for SCS for SB 810
Subject: Public Assistance: Energy
Type: Corrected#
Date: May 1, 2002
#To correct response from Department of Social of Services.
FISCAL SUMMARY
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| General Revenue# | ($89,896) to $104,703 | ($112,190) to $130,670 | ($116,679) to $135,897 |
| Total Estimated
Net Effect on All State Funds# |
($89,896) to $104,703 | ($112,190) to $130,670 | ($116,679) to $135,897 |
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| Federal*# | $0 | $0 | $0 |
| Total Estimated
Net Effect on All Federal Funds* |
$0 | $0 | $0 |
*Possible costs and/or savings net to $0.
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| Local Government | $0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 7 pages.
ASSUMPTION
LOW INCOME ENERGY ASSISTANCE PROGRAM - Sections 660.100 to 660.136
Officials of the Department of Social Services' Division of Family Services (DFS) stated that they anticipate an increased number of consumers would be eligible for the Low Income Energy Assistance Program (LIHEAP). However, the current limits on appropriations to the Utilicare Stabilization Fund (section 660.135) would still be in effect. Therefore there would be no impact on state funds.
DIVISION OF ASSETS - Section 660.690
Department of Social Services' Division of Family Services reported that 180 supplemental nursing care cases were rejected due to income or resources, in FY 2001. They estimate that 63 (35%) of those cases were married couples. They also report that 95.9% of supplemental nursing care patients reside in Residential Care I or II Facilities and 4.1% of those patients reside in Skilled Nursing Facilities. Therefore 60 of the new cases would be in Residential Care Facilities and 3 in Skilled Nursing Facilities.
The Department's Division of Senior Services provides case management services for clients receiving personal care services in Residential Care Facilities. Some of the 60 new cases would require case management; however, those case management services could be absorbed with existing staff at this time.
#Division of Assets for RCF Residents:
The proposed legislation will have a fiscal impact on the DMS. More individuals will be Medicaid
eligible if the division of assets is applied to persons living in a RCF.
The Division of Family Services estimates there are 64 individuals who would become Medicaid
eligible with the passage of this legislation. This includes 3 individuals who would live in a skilled
nursing facility. It should be noted, the proposed legislation does not include Intermediate Care
Facilities (ICF) and Skilled Nursing Facilities (SNF); however, they are part of the Supplemental
Nursing Care program. Cost for residents living in a SNF are included in the fiscal impact. The costs are shown separately.
The cost per eligible is $656.40/month. The average is based on the last three months of actual expenditures - hospital, dental, physician services, personal care and rehabilitation & specialty services. (The RCF resident is not eligible for all home and community services - only personal care.)
ASSUMPTION (continued)
RCF residents - 17 RCF I and 44 RCF II = 61 eligibles x $656.40 = $40,040.40 per month.
SNF residents - 3 x $656.40 = $1,969.20 per month.
A 4% inflation factor was applied to both FY 04 and FY 05.
FY 03:
RCF residents - $40,040.40 x 10 months = $400,404
SNF residents - $1,969.20 x 10 months = $19,692
Total $420,096
FY 04:
RCF residents - $41,642.02 x 12 months = $499,704
SNF residents - $2,047.97 x 12 months = $24,576
Total $524,280
FY 05:
RCF residents - $43,307.70 x 12 months = $519,692
SNF residents - $2,129.89 x 12 months = $25,559
Total $545,251
Due to the division of assets fro married couples proposed in the legislation, individuals are provided the opportunity to enter an RCF I/II facility over and ICF/SNF nursing facility. We estimate that between 10% and 35% will choose RCF over a nursing facility resulting in a cost avoidance.
63 x 10% = 6.3 individuals or 6
63 x 35% = 22.05 individuals or 22
Medicaid nursing facility costs approximately $30,000 per individual per year.
FY 03:
10% cost avoidance
SNF/ICF residents to RCF residents - ($30,000 x 6) x 10 months = $150,000
$60,000 - GR (40%)
$90,000 - FF (60%)
ASSUMPTION (continued)
35% cost avoidance
SNF/ICF residents to RCF residents - ($30,000/yr x 22) x 10 months = $550,000
$220,000 - GR (40%)
$330,000 - FF (60%)
FY 04:
10% cost avoidance
SNF/ICF residents to RCF residents ($30,000/yr x 6) = $180,000 x 4% inflation = $187,200
$74,880 - GR (40%)
$112,320 - FF (60%)
35% cost avoidance
SNF/ICF residents to RCF residents - ($30,000/yr x 22) = $660,000 x 4% inflation = $686,400
$274,560 - GR(40%)
$411,840 - FF (60%)
FY 05:
10% cost avoidance
SNF/ICF residents to RCF residents ($30,000/yr x 6) = $180,000 x 4% inflation = $187,200 x 4% inflation = $194,688
$77,875 - GR(40%)
$116,813 - FF(60%)
35% cost avoidance
SNF/ICF residents to RCF residents - ($30,000/yr x 22) = $660,000 x 4% inflation = $686,400 x 4% inflation = $713,856
$285,542 - GR(40%)
$428,14 - FF(60%)
ASSUMPTION (continued)
Officials of the Department of Social Services' Division of Family Services stated that they anticipate 64 cases per year which would have been rejected would be accepted into Residential Care I Facilities (17 cases at $156/month + $25 Personal Needs Standard), Residential Care II Facilities (44 cases at $292/month + $25 Personal Needs Standard), and Skilled Nursing Care Facilities (3 cases at $390/month + $25 Personal Needs Standard).
Officials of the Division of Medical Services anticipates additional costs to Medicaid based on cost per eligible of $656.40/month (increased 4% per year for FY 2004 and FY 2005). They also assume that some of the persons turned down for Residential Care Facilities are going into nursing facilities. Since some persons going into nursing facilities would go into Residential Care Facilities (RCFs) instead, there would be a cost savings. Officials figured cost savings at 10% choosing RCFs over nursing facilities and 35% choosing RCFs over nursing facilities. They estimate the actual percentage each year would lie between 10% and 35%.
| FISCAL IMPACT - State Government | FY 2003
(10 Mo.) |
FY 2004 | FY 2005 |
| GENERAL REVENUE FUND | |||
| Department of Social Services | |||
| Cost - Increased Residential Care and Skilled Nursing Facility Cases# | ($162,871) | ($203,263) | ($211,394) |
| Savings - Decrease Nursing Facility Cases# | $72,975 to $267,574 | $91,073 to $333,933 | $94,715 to $347,291 |
| ESTIMATED NET EFFECT ON GENERAL REVENUE FUND | ($89,896) to $104,703 | ($112,190) to $130,670 | ($116,679) to $135,897 |
| FEDERAL FUNDS | |||
| Income/Loss of Federal Matching Funds# | $372,475 to $679,809 | $464,849 to $848,402 | $483,443 to $882,337 |
| Increase/Decrease in Medicaid Spending# | ($372,475 to $679,809) | ($464,849 to $848,402) | ($483,443 to $882,443) |
| ESTIMATED NET EFFECT ON FEDERAL FUNDS # | $0 | $0 | $0 |
| FISCAL IMPACT - Local Government | FY 2003
(10 Mo.) |
FY 2004 | FY 2005 |
| $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 would change the Utilicare program. Some of the changes are as follows:
1) a household would qualify for Utilicare aid if household income were one hundred and fifty percent (150%) or less of current federal poverty guidelines (currently household income may not exceed 110% of those guidelines) or if household income did not exceed 60% of the state median income;
2) the $150 limit on payments to eligible households would be increased to $600;
3) the limitation on using general revenue for reconnecting or maintaining service to eligible households which have had service disconnected until federal emergency funds for those services have been obligated would be removed;
4) low-income weatherization projects partly funded with utilicare funds, in coordination with Department of Natural Resources' low income weatherization assistance program, would comply with federal guidelines (currently, such projects must have a full energy savings payback period of no more than ten years);
5) the Department of Social Services would coordinate all federal heating assistance programs into the Utilicare program; and
6) the sources of income for and uses of the Utilicare Stabilization Fund would be changed.
This proposal would also require the Division of Family Services to do a division of assets for married couples when determining eligibility for supplemental nursing care payments when one
spouse is living in a residential care facility.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space. This legislation would not affect Total State Revenue.
SOURCES OF INFORMATION
Department of Social Services
Mickey Wilson, CPA
Acting Director
May 1, 2002