COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 2867-01
Bill No.: SB 762
Subject: Health Care; Health Care Professionals; Health Department; Health, Public; Insurance - Medical; Physicians; Mental Health Department; Social Services Department; Revenue Department
Type: Original
Date: March 12, 2002
FISCAL SUMMARY
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| General Revenue | ($746,814 to Unknown) | ($281,199,795 to Unknown) | ($562,399,589 to Unknown) |
| County Insurance Tax | $0 | ($12,500,000) | ($25,000,000) |
| Insurance Dedicated | $0 | ($63,964) | ($127,927) |
| Conservation | $0 | ($1,720,000) | ($3,440,000) |
| Highway | $0 | ($2,271,279) | ($4,536,920) |
| Missouri Health Care Trust | $0 | (Unknown) | (Unknown) |
| Health Professional Education and Training | $0 | $0 | $0 |
| Total Estimated
Net Effect on All State Funds |
($746,814 to Unknown) | ($297,755,038 to Unknown) | ($595,504,436) |
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| Federal funds | $0 | Unknown | Unknown |
| Total Estimated
Net Effect on All Federal Funds |
$0 | Unknown | Unknown |
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| Local Government | $0 | (Unknown) | (Unknown) |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 18 pages.
ASSUMPTION
This proposal would become effective if approved by the voters in the general election to be held on the Tuesday following the first Monday in November, 2002. Section A of this proposal would become effective April first of the year following notice to the revisor of statutes that a waiver had been obtained from the Secretary of the United States Department of Health and Human Services. The health premium surcharge and the income tax surcharge would apply to all tax years beginning on or after January first of the year following receipt of notice that appropriate waivers had been obtained. The small employer tax credits would apply to five consecutive tax years beginning on or after January first of the first year following notice by the revisor of statutes that appropriate waivers had been obtained.
Officials from the Division of Budget and Planning, the Department of Health and Senior Services, the Department of Economic Development, Harris-Stowe College and the Office of the State Courts Administrator assume this proposal would not fiscally impact their agencies.
The Department of Insurance (INS) officials state this legislation would eliminate health insurance through companies. This would result in a decrease in premium tax revenue that is split 50/50 between GR and County Foreign Insurance. County Foreign Insurance funds are later distributed to school districts.
INS states the 2% premium tax assessed and collected from private insurers on health and accident insurance policies would be lost due to the single payer system. INS estimates that in fiscal year 2000, over $50 million in premium taxes were from accident and health insurance policies. These revenues would be lost if legislation is implemented. INS would also be required to pay the health premium surcharge of 12% on its employees. FY03 personal services appropriations are estimated at $5,073,276 from Insurance Dedicated Fund. Surcharge of 12% would be a cost of $608,793. INS costs for insurance was approx. 9.5% of salaries for FY01($481,961). Additional cost to INS as a results of legislation would be $127,832 from ASSUMPTION (continued)
Insurance Dedicated Fund.
Officials from the Missouri Department of Conservation (MDC) state that this proposed
legislation appears to have significant impact on MDC funds because of a 12% surcharge on total wages paid by MDC. The estimated fiscal impact on MDC based on current salaries and wages would be approximately $3.44 million.
The Department of Mental Health (DMH) assumes that Title XVIII and Title XIX money will now be deposited into the Missouri Health Care Trust Fund rather than General Revenue Fund or the Federal Fund. For fiscal note purposes, DMH assumes that all money they currently deposit into these funds would be deposited into the Missouri Health Care Trust Fund. In FY01, DMH recovered $220,157,216 ($185,527,214 GR and $34,630,002 Federal). DMH states that this proposal does not represent a loss of funds to the state. Instead, these funds would be used to provide medical services to persons through the Missouri Health Care Trust Fund. If the program chooses DMH as a provider of services, the fiscal impact to DMH would depend on the payments made to them under the new plan in relation to current general revenue funding. If the program chooses not to utilize DMH as a provider, there could be a loss of funding to the department. DMH assumes that COA will include the employer surcharge in their fiscal note impact for all state employees.
Southwest Missouri State University (SMSU) officials estimate they would expect to incur a cost of $11,009,495 for the health care surcharge described in this proposal. SMSU currently pays $6,205,881 to cover its employees' health care insurance. Therefore, SMSU assumes this proposal would result in additional annual costs of approximately $4,803,614.
Officials from Department of Transportation (DHT) assume that this legislation will require DHT to participate in the Missouri Universal Health Assurance Program. It would require DHT to pay a surcharge of 12% of total payroll to cover our employees enrollment in the program. DHT also assumes that the Highway and Patrol Medical Plan will no longer be needed.
DHT assumes the effective date is January 1, 2004 due to this legislation going to the vote of the people in November, 2002. Once passed, the board must apply for waivers from the Federal Government. Not until the January of the year following the receipt of these waivers from the Federal Government is the legislation effective. DHT assumes it is unlikely that these waivers will be received during their application year of 2002 but will actually be received in 2003. Therefore, the program will begin collecting surcharges the following calendar year (2004). However, due to the timing of the fiscal year, FY2004 will only show an impact for 6 months (January to June).
To compute the surcharge, DHT's FY01 payroll of $241,511,887 was increased by an inflation ASSUMPTION (continued)
rate of 2.5% for each year and then multiplied by 12%. MoDOT employees are paid from the General Revenue, Federal, Highway, State Transportation Fund and Aviation Trust Fund. DHT assumes the 12% surcharge to fund this legislation will come from these various funds and
therefore, this legislation will impact these funds for FY04 as follows: General Revenue, $18,752; Federal, $29,247; Highway, $15,533,739; State Transportation, $2,814; and Aviation Trust Fund, $20,361.
DHT also assumes that the Highway and Patrol Medical Plan will no longer be needed. To compute the estimated appropriation request of $27,444,451 for the medical plan in FY04, DHT inflated the FY02 appropriation amount of $25,373,938 by 4% per year. DHT assumes since the plan will no longer be needed, this represents a cost savings. The cost savings for FY04 are as follows: General Revenue, $16,489; Federal, $25,719; Highway, $13,659,639; State Transportation, $2,474; and Aviation Trust, $17,904.
Additionally, DHT states based on the assumption that the Highway and Patrol Medical Plan will no longer be needed, there will be a potential reduction in staff of approximately 50% which totals $150,000 for a full year. However, DHT assumes the reduction would occur through attrition and therefore, no exact titles can be provided. There will also be an estimated expense and equipment savings of $10,000 for a full year related to the reduced staff.
Oversight has presented the fiscal impact for the Highway Fund only as the fiscal impact on General Revenue, Federal, Aviation, and State Transportation were minimal.
Officials from the Department of Public Safety - Missouri State Highway Patrol (MHP) state that MHP employees are paid from the General Revenue, Highway, Gaming, and other smaller funds. MHP assumes the 12% surcharge to fund this legislation will come from these various funds and therefore, this legislation will impact these funds for FY04 as follows: General Revenue, $987,430; Highway, $7,794,287; and all other funds $774,711. MHP assumes that the Highway and Patrol Medical Plan will no longer be needed. The current state share contributed to the Highway and Patrol Medical Plan is as follows: General Revenue, $566,821; Highway, $4,902,274; and all other funds, $401,398. Therefore, the additional costs are as follows: General Revenue, $420,609; Highway, $2,892,014; and all other funds, $373,313.
Oversight has presented the fiscal impact for the General Revenue and Highway funds only as the other funds were minimal.
The Department of Labor (DOL) assumes under this proposed legislation the cost would be $4,752,527. The calculation is as follows: FY 2001 payroll $39,604,391 X 12% proposed tax.
Oversight assumes the Office of Administration will calculate the increased benefit cost for all state employees.
ASSUMPTION (continued)
Central Missouri State University officials assume this proposal would result in unknown increased costs.
The Department of Elementary and Secondary Education (DES) assume that salaries which would be paid in FY01 would be $81,631,270, resulting in an employer surcharge of $9,795,752. DES states the rate of reduction of the workers' compensation insurance is not stated; therefore, the net fiscal impact cannot be estimated. However, DES estimates that costs will exceed $100,000. Oversight assumes the Office of Administration will calculate the increased benefit costs for all state employees.
Officials from the Office of Secretary of State (SOS) state this proposal creates the Missouri Universal Health Assurance Program, the Missouri Health Care Trust Fund and the Health Professional Education and Training Fund which requires the Board of Governors for the Missouri Universal Health Assurance Program and the Department of Revenue to promulgate rules to implement the proposal. SOS states based on experience with others divisions, the rules, regulations and forms issued by the Board and the Department could require as many as approximately 36 pages in the Code of State Regulations. For any given rule, SOS states roughly one-half again as many pages are published in the Missouri Register as are published in the Code because of cost statements, fiscal notes and notices that are not published in the Code. The estimated cost of a page in the Missouri Register is $23.00. The estimated cost of a page in the Code of State Regulations is $27.00. The actual costs could be more or less than the numbers given ($2,214). The impact of this legislation in future years is unknown and depends upon the frequency and length of rules filed, amended, rescinded and withdrawn.
SOS did not comment on the cost of the election associated with this proposal. Oversight assumes costs would be similar to those in a similar proposal from the previous session. Based on actual publications costs of the November, 1998 election, SOS estimated publication costs on a thirty page proposal to be approximately $744, 600. These costs would be paid from general revenue. SOS also noted that if the governor calls a special election, the fiscal impact could exceed $1,000,000, depending on the date of the special election.
Truman State University officials report that the 12% surcharge would result in costs of $4,083,643 annually. The cost of its current plan is $2,726,315 for an increased cost of $1,357,328.
The Department of Social Services - Division of Medical Services (DMS) assumes the population (Medicaid) would be the same whether they were served by the new entity or contracted to DMS to administer. DMS assumes the institutional care would remain constant regardless of the administering agency. To the contrary, independent providers would be reimbursed on a fee-for-service schedule that is anticipated to represent usual and customary ASSUMPTION (continued)
charges (UCR). DMS assumes costs would increase because current Medicaid reimbursement for non-institutional providers in many cases represents less than UCR. For example, dental ambulance, and physician reimbursement is currently paid at less than UCR. If the negotiated
reimbursement were to reflect 75% to 100% of UCR, DMS anticipates that additional costs of approximately $120,400,000 to $177,900,000 would be realized. This was derived through calculating the difference between current reimbursement for the dental, ambulance and physician programs and the cost for these services at 75% to 100% of UCR. A dental program fee increase decision item was developed for the FY 03 budget in which procedures were identified by current Medicaid reimbursement and UCR. This resulted in a difference of approximately $22,200,000 to $29,700,000. A physician program fee increase decision item was developed for the FY 03 budget. An increase of $92,200,000 to $142,200,000 would be needed to bring physician fees up to 75% to 100% of UCR. Similarly, and ambulance fee increase was developed and requested in the FY 98 budget in which Medicaid rates were compared to Medicare (UCR) rates and resulted in $6,000,000.
The loss of the advantage of competitively bidding managed care contracts would result in additional costs of over $21,800,000 or five percent of current Missouri Care Plus (MC+) payments. DMS cannot arrive at an actual dollar increase to Medicaid; however, they estimate an increase exceeding $100,000,000 annually. No impact for FY 02 is anticipated due to the time frames involved in waiver applications and implementations. No cost to DSS is associated with the DSS director serving on the Board of Governors, as all expenses would be paid from the Health Care Trust Fund.
Oversight notes that based on DOS FY 02 budget for the Medicaid vendor payments and managed care through Medicaid was $4,371,26,1275. For fiscal note purposes, Oversight has represented unknown costs associated with personal services and expense and equipment for DMS as being saved by the state because the state's Medicaid program as it now exists would no longer be in place. Depending on the provisions of the waivers, if obtained, some of the functions of the DMS could be required to be performed by the Missouri Universal Health Assurance Program.
Missouri Consolidated Health Care Plan (HCP) state this proposal requires employers with more than 499 employees to pay 12% of payroll into the insurance fund. The state contribution for employee health care would fall into this category. HCP estimates that the first year cost of this program could be a savings of $57,774,417 for the state. The fiscal impact for the Public Entities for the first year could be $16,115,442. HCP states the projected 2002 gross annual payroll for HCP covered departments and agencies (not including Missouri Department of Transportation and Conservation) is $1,497,387,227. The proposal would require the state to contribute 12% of payroll, or $1,497,387,227 x 12% = $179,686,467. HCP states this amount represents the state contribution. It does not include any employee contribution that is covered ASSUMPTION (continued)
under the employee surcharge section of the proposal and is assessed based upon a tax formula applied against adjusted gross earnings. The state contribution under this proposal is $57,774,417 less than the current state contribution and administration expense of $237,460,884.
The HCP estimates the calendar year Public Entity costs could be $32,230,884. The HCP estimates Public Entity payroll to be $201,443,025. Oversight will present costs to Public Entities as unknown since Public Entity payroll information is not available.
HCP notes 12% is not sufficient to sustain the program based on HCP actual cost of providing insurance. HCP also notes no administration costs were included with the figures. HCP notes while the state's payroll for members covered by the HCP has actually decreased (thus lowering the revenues) the actual cost of providing services has increased approximately 25%. HCP states these additional costs would become the full responsibility of the members.
Officials from the Department of Revenue (DOR) state this proposal has no fiscal impact to the DOR. DOR assumes costs for the plan will be completed by OA Budget and Planning.
Oversight notes in a response to a similar fiscal note from three previous sessions, DOR estimated an impact of approximately $5,500,000 per year. DOR assumed they would need
additional FTE within the Division of Taxation and Collection, and outside contractors to implement this proposal. DOR assumes the Central Processing Bureau would need fourteen Clerks I for mail extraction and to pre-sort the 1.3 million employer forms and 2.4 million returns; and two clerks I to operate two new remittance processors.
DOR assumed the Tax Administration Bureau would require six Tax Processing Technicians I to work with withholding errors and twelve Tax Processing Technicians to work with individual return type errors for the expected 20% error rate.
DOR assumed the Collections Bureau would require eighteen Tax Processing Technicians I to
be responsible for processing correspondence, bankruptcy claims, and petitions, and handling incoming and outgoing telephone calls associated with billings and non-filer notices. The Collections Bureau would also need four Clerks I to support the Tax Processing Technicians, eight Tax Service Representatives I to pursue delinquent and non-filer employers, and one Clerk I to support these additional FTE.
DOR assumed the Information Systems Division would need three Programmer Analysts II to be responsible for new programming and maintenance of programs, and one Senior System Analyst to supervise the Programmer Analysts and contract programmers. Contract programmers would also be needed for 550 hours for two years. Oversight will assume an unknown cost for DOR personal service, fringe benefits and expense and equipment.
ASSUMPTION (continued)
Officials from the Department of Higher Education (CBH) assume the impact of this legislation on CBH and higher education institutions is unknown.
Officials from the Department of Corrections (DOC) state that it is unknown what fiscal impact, if any, passage of this bill would have for the DOC. It is unclear whether offenders incarcerated within DOC would fall under the auspices of this bill. Inmates are not excluded as 'residents' of Missouri in the language of this bill and therefore appear to be covered under this assurance program for medical and mental health services. They are counted as Missouri residents in the national census taken every 10 years. If indeed they are covered, it is likely that jails and mental health clients would qualify as well. In that instance, DOC would have a significant positive fiscal impact if this bill were passed as law.
It is also unknown what health standards may be imposed by the program. If these standards exceed NCCHC standards for accreditation, the level of inmate care would similarly increase, therefore raising expenses for the department .
The Office of Administration (COA) states as central payroll processor for state employees, COA would be required to modify COA's payroll system to withhold and report the employee health premium surcharge. COA states the legislation indicates that the Board can adjust the employer rates and employee surcharge rates as needed to cover the program costs. Since the current level of funding for HCP is approximately 16% of wages from the state plus the employee share, the current 12% appears to be much less than required to fund the plan. COA anticipates significant increases in the employer share percentage and the employee surcharge to meed current and future health costs.
COA states FY 2001 personal service (all funds) was $3,319,313,497. Employee health premium surcharge of 12% would be $398,317,620. Oversight notes that this is $351,451,766 without DHT, MDC and MHP which will be presented separately. Annual cost of employer share for current plan - HCP is projected to be approximately $216,000,000.
COA states cost of reprogramming current employer payroll systems to withhold and report employee surcharge is unknown. The costs would be driven by how the Department of Revenue requires the monies to be withheld and reported in conjunction with normal state income tax withholding. COA anticipates that this would be a major expense for the state and all other employers.
COA did not comment on the estimated premium tax that would be collected from all Missouri employers or Missouri individuals. However, Oversight notes in a similar proposal from last year, COA estimated the premium tax on all Missouri employers would generate revenues of $5,685,000,000 for the Health Care Trust Fund and $690,000,000 from Missouri individuals.
ASSUMPTION (continued)
Officials from the Department of Natural Resources (DNR) state DNR had 2,060 FTE's in FY 02. Based upon a FY 02 Personal Service Budget of $69,169,034, a 12% surcharge would be
$8,300,284. Oversight assumes the Office of Administration will calculate the increased benefit costs for all state employees.
For purposes of this fiscal note, Oversight assumes:
agencies from a number of funds which would accrue to the Missouri Health Care Trust Fund and be saved by the current fund. Further, these costs would be included in projections made based on per capita cost of health care. Agencies affected would include the Department of Elementary and Secondary Education, Department of Corrections, Department of Labor, Department of Health, Department of Mental Health, etc. The 12 % employer surcharge tax for health care premiums for the Departments of Conservation, Transportation, and Missouri State Highway Patrol will be presented separately. The 12% surcharge for the rest of the state employees will be presented under
ASSUMPTION (continued)
the Office of Administration.
| FISCAL IMPACT - State Government | FY 2003
(10 Mo.) |
FY 2004 | FY 2005 |
| GENERAL REVENUE FUND | |||
| Income - Department of Social Services | |||
| Medicaid reimbursements | $0 | Unknown | Unknown |
| Savings - Department of Social Services | |||
| Possible elimination or cutback in | |||
| Division of Medical Services | $0 | Unknown | Unknown |
| Savings - Missouri Consolidated Health Care Plan | |||
| Possible elimination or cutback | $0 | Unknown | Unknown |
| Savings - Department of Health and Senior Services | |||
| Senior Rx Program-possible | |||
| elimination or cutback | $0 | Unknown | Unknown |
| Loss - Department of Insurance | |||
| Insurance premium tax | $0 | ($12,500,000) | ($25,000,000) |
| Loss - Department of Mental Health | $0 | ($92,763,607) | ($185,527,214) |
| Medicaid reimbursements | |||
| Costs - Department of Public Safety | |||
| Missouri State Highway Patrol | |||
| Fringe Benefit surcharge | $0 | ($210,305) | ($420,609) |
| Costs -Office of Administration | |||
| Personal service, fringe benefits and | |||
| expense and equipment costs for | |||
| reprogramming the current payroll | |||
| system | (Unknown) | (Unknown) | (Unknown) |
| Costs - Department of Revenue | |||
| Personal Service, fringe benefit and expense and equipment costs to process | |||
| additional employee and employer | |||
| forms | (Unknown) | (Unknown) | (Unknown) |
| Costs - Secretary of State | |||
| Election costs | ($746,814) | $0 | $0 |
| Costs - Office of Administration | |||
| Fringe benefit surcharge for state | |||
| employees other than DOC, DHT, and | |||
| MHP | $0 | ($175,725,883) | ($351,451,766) |
| ESTIMATED NET EFFECT ON GENERAL REVENUE FUND* | ($746,814 to Unknown) | ($281,199,795 to Unknown) | ($562,399,589 to Unknown) |
| *Does not include possible income | |||
| and/or cost for Medicaid | |||
| reimbursements from the Department | |||
| of Social Services, Division of | |||
| Medical Services | |||
| COUNTY INSURANCE TAX FUND | |||
| Loss - Department of Insurance | |||
| Insurance premium tax | $0 | ($12,500,000) | ($25,000,000) |
| ESTIMATED NET EFFECT ON | |||
| COUNTY INSURANCE TAX FUND | $0 | ($12,500,000) | ($25,000,000) |
| INSURANCE DEDICATED FUND | |||
| Costs - Department of Insurance | |||
| Fringe benefit surcharge | $0 | ($63,916) | ($127,832) |
| ESTIMATED NET EFFECT ON | |||
| INSURANCE DEDICATED FUND | $0 | ($63,916) | ($127,832) |
| CONSERVATION FUND | |||
| Costs - Department of Conservation | |||
| Fringe benefit surcharge | $0 | ($1,720,000) | ($3,440,000) |
| ESTIMATED NET EFFECT ON | |||
| CONSERVATION FUND | $0 | ($1,720,000) | ($3,440,000) |
| HIGHWAY FUND | |||
| Savings - Department of Transportation | |||
| Medical plan staff elimination | |||
| Personal service (3 FTE) | $0 | $75,000 | $153,750 |
| Fringe benefits | $0 | $31,778 | $65,144 |
| Expense and Equipment | $0 | $5,000 | $10,300 |
| Total Savings | $0 | $111,778 | $229,194 |
| Costs - Department of Transportation | |||
| Fringe benefit surcharge | $0 | ($937,050) | ($1,874,100) |
| Costs - Department of Public Safety- | |||
| Missouri State Highway Patrol | |||
| Fringe benefit surcharge | $0 | ($1,446,007) | ($2,892,014) |
| ESTIMATED NET EFFECT ON | |||
| HIGHWAY FUND | $0 | ($2,271,279) | ($4,536,920) |
| MISSOURI HEALTH CARE | |||
| TRUST FUND | |||
| Income - Office of Administration | |||
| Employer premium tax* | $0 | $2,842,500,000 | $5,685,000,000 |
| Individual surcharge tax | $0 | $345,000,000 | $690,000,000 |
| Total Income - Office of Administration | $0 | $3,187,500,000 | $6,375,000,000 |
| *Includes premium tax paid by the state for all state employees | |||
| Income - Department of Social Services | |||
| Medicaid Reimbursements | $0 | Unknown | Unknown |
| Income - Department of Mental Health | |||
| Medicaid and Medicare reimbursements | $0 | $110,078,608 | $220,157,216 |
| Costs - Missouri Health Care Trust Fund | |||
| The plan could become effective on April | |||
| 1, 2004, at which time costs to administer | |||
| the plan (staff, Board of Governor's | |||
| expense, Regional Advisory Council | |||
| expenses, etc.) and to provide health care | |||
| benefits at costs, which would be negotiated by the Board of Governors as specified in the proposal, would be borne by the Fund. Using HCFA per capita, 2000 census figures for Missouri and 5% annual increases in health care costs, it is projected that expenditures from the Fund for benefits would equal $7,479,372,575 for the three months in FY 2004. Administrative costs would be capped at four percent of the income generated from the various sources. A reserve equal to expenditures in the preceding three months would be required. | |||
| ESTIMATED NET EFFECT ON | |||
| MISSOURI HEALTH CARE TRUST FUND* | $0 | (UNKNOWN) | (UNKNOWN) |
| *Does not include possible income and/or costs for Medicaid reimbursements from the Department of Social Services - Division of Medical Services. | |||
| HEALTH PROFESSIONAL EDUCATION AND TRAINING FUND | |||
| Income | |||
| Federal government and other | $0 | Unknown | Unknown |
| Costs | |||
| Personal services, expense and equipment | $0 | (Unknown) | (Unknown) |
| ESTIMATED NET EFFECT ON | |||
| HEALTH PROFESSIONAL | |||
| EDUCATION AND TRAINING FUND | $0 | $0 | $0 |
| FEDERAL FUNDS | |||
| Savings - Department of Social Services | |||
| Possible elimination or cutback in | |||
| Division of Medical Services | $0 | Unknown | Unknown |
| Loss - Department of Social Services | |||
| Medicaid funding | $0 | (Unknown) | (Unknown) |
| Loss - Department of Mental Health | |||
| Medicaid reimbursemetns | $0 | ($17,315,000) | ($34,630,002) |
| ESTIMATED NET EFFECT ON | |||
| FEDERAL FUNDS | $0 | (Unknown) | (Unknown) |
| ALL LOCAL GOVERNMENTS | |||
| Savings - All Local Governments | |||
| Health insurance programs | $0 | Unknown | Unknown |
| - All Local Governments | |||
| Fringe benefits | $0 | (Unknown) | (Unknown) |
| ESTIMATED NET EFFECT ON ALL | |||
| LOCAL GOVERNMENTS | $0 | (UNKNOWN) | (UNKNOWN) |
FISCAL IMPACT - Small Business
Small businesses would be expected to be fiscally impacted to the extent that they would incur additional administrative costs and additional payroll tax expense due to the requirements of this proposal.
DESCRIPTION
This proposal establishes the "Missouri Universal Health Assurance Program" (Program). The Program is a publicly- financed, statewide insurance program that will provide comprehensive health care coverage for Missouri residents.
The Director of the Department of Health will divide the population of the state into six regional districts, with an advisory council of seven private citizens established for each district. The advisory councils will assist the Board in development of a comprehensive state health care plan and will develop a transportation plan for indigent, elderly, and disabled clients.
The Program will be administered by a nineteen member Board of Governors, ten of which will be appointed by the Governor. The Directors of the Departments of Social Services, Health, and Mental Health will be ex-officio members and the Board shall include a representation of minority and disabled individuals. The Board will be responsible for implementing the Program, monitoring expenditures, adopting rules, employing staff, and studying the means of incorporating institutional long-term care benefits into the Program. An annual report will be required after conducting investigations and utilization reviews.
An annual comprehensive state health care plan should be established by the Board and should include a budget, an evaluation of district health care needs, and goals for various parts of the DESCRIPTION (continued)
Program. Prior to establishment, the Board should appoint advisory subcommittees of health care research and ethics experts and public hearings should be held. The resulting comprehensive health care plan should seek to secure the most cost-effective health care.
The Board shall establish the "Missouri Health Care Trust Fund" which will be used for all aspects of Program operation. Revenues held in the trust fund are not subject to appropriation or allotment by the State or any political subdivision of the State. Various accounts will be created within the trust fund for specific purposes.
Every person who is a resident of Missouri, regardless of preexisting conditions, will be eligible to receive benefits for covered services under the Program. Persons who are not residents, but who are employed in Missouri will be eligible for benefits if a health premium surcharge is paid. Certain services, as listed, will not be covered under this Program.
The Program shall pay the expenses of institutional providers of health care and each provider shall negotiate an annual budget with the Program to cover anticipated expenses. The Program will reimburse independent providers of health care on a fee for service basis. Other insurers and employers may offer benefits that do not duplicate those offered by the Program. Sections 354.750 to 354.816 of this act will become effective April 1 of the year following the award of a waiver by the Department of Health and Human Services.
Every employer or self-employed person within the State will pay a health premium surcharge to the Department of Revenue based on the number of employees it has. A health premium surcharge, in addition to the state income tax, will be imposed on residents' gross income. An employer may agree to pay all or part of an employee's surcharge.
No later than thirty days after the effective date of this act, the Department of Social Services shall apply to the United States Secretary of Health and Human Services for all health care program waivers that would enable the state to deposit federal funds into the Missouri health care trust fund created in Section 354.771. The Department should also identify other federal fund sources. Under the same time frame, the Governor shall appoint Board members.
The Board shall request that the Program be made available to federal employees and retirees while they are residents of Missouri.
For five consecutive tax years after approval of the Program, any employer who has twenty-five or less employees will be allowed a tax credit against the new tax due in incremental amounts.
DESCRIPTION (continued)
Certain sections of this act have a conditional effective date and the entire act will be submitted to the voters of the state for approval or rejection in November, 2002.
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
Office of Administration -
Division of Budget and Planning
Department of Health and Senior Services
Department of Economic Development -
Division of Professional Registration
Office of the State Courts Administrator
Department of Insurance
Missouri Department of Conservation
Department of Mental Health
Southwest Missouri State University
Department of Transportation
Department of Public Safety -
Missouri State Highway Patrol
Department of Labor
Central Missouri State University
Department of Elementary and Secondary Education
Office of Secretary of State
Truman State University
Department of Social Services -
Division of Medical Services
Missouri Consolidated Health Care Plan
Department of Higher Education
Office of Administration
Department of Revenue
Harris-Stowe College
Department of Corrections
Department of Natural Resources
Not Responding: Missouri Western College
Mickey Wilson, CPA
Acting Director
March 12, 2002