LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 698 HLS 21RS 1088
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.: HB 186
Date: June 9, 2021 4:19 PM Author: BACALA
Dept./Agy.: LDH/DCFS
Subject: Interagency agreements to offset Medicaid costs Analyst: Shane Francis
STATE AGENCIES EN INCREASE GF EX See Note Page 1 of 2
Provides for state agency partnerships to improve Medicaid administration and program integrity
Proposed law requires LDR and LDH to enter into cooperative endeavors such that LDH provide to LDR identifying information of each
person enrolled in Medicaid under the age of 19 and each adult enrolled in the Medicaid program whose application indicates any child or
children under the age of 19 who live with them. LDR shall examine tax returns to identify children within Medicaid who are claimed as
dependents by noncustodial parents. Statistical information would be presented to the legislature annually whilst containing no identifying
information on any individual.
Proposed law provides that agreements between DCFS and LDH provide for remittance between DCFS to LDH in connection with each
noncustodial parent of a child enrolled in Medicaid when all of the following are true: 1) the noncustodial parent has been ordered by a
court to make cash medical payments, 2) DCFS is providing support enforcement services and 3) cash medical support has been assigned
to the state in accordance with relevant laws.
EXPENDITURES 2021-22 2022-23 2023-24 2024-25 2025-26 5 -YEAR TOTAL
State Gen. Fd. $113,040 $0 $0 $0 $0 $113,040
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $113,040 $0 $0 $0 $0 $113,040
REVENUES 2021-22 2022-23 2023-24 2024-25 2025-26 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $193,533 $193,533 $193,533 $193,533 $193,533 $967,665
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds ($127,732) ($127,732) ($127,732) ($127,732) ($127,732) ($638,660)
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $65,801 $65,801 $65,801 $65,801 $65,801 $329,005
EXPENDITURE EXPLANATION
The LA Department of Revenue (LDR) estimates an additional $113,040 in one-time expenditures for computer system
development, testing and tax form redesign; LDR does not collect dependent Social Security numbers from its paper returns.
Additional indeterminate IT costs are anticipated to program and implement processes to begin capturing dependent Social
Security Numbers from paper returns. An assessment will be made at the end of the session to assess the cumulative effect
of all new legislation. It may be determined that additional resources are needed at that time.
Proposed legislation requires the LA Department of Health (LDH) to provide information to LDR on children in Medicaid and
adults enrolled in Medicaid who indicate any child or children under the age of 19 who live with them. Information on past
and currently enrolled children and adults can be shared by LDH to LDR without additional expense.
The Department of Children and Family Services (DCFS) does not anticipate any additional expenditures due to proposed
legislation.
REVENUE EXPLANATION
LDH may observe increases in revenue dependent on the efficacy of new DCFS enforcement processes developed in
response to proposed legislation’s incentive payment structure and LDR’s ability to identify noncustodial parents who are
currently noncompliant with court-ordered cash medical payments. In the short-term, revenue generated for LDH through
additional remittances are indeterminate until such time a ‘bottleneck’ for existing payments can be identified, whether due
to existing limitations to noncustodial parent identification or resources available to enforce. Proposed legislation seeks to
address both of these simultaneously, and so additional revenue will be proportional to the efficacy of interagency
agreements.
DCFS estimates incentive payments (see next page $193,533) will reduce reimbursable expenses under Title IV-D of the
Social Security Act which is subject to a 66%/34% Federal Financial Participation rate. DCFS will observe a reduction in
necessary state match expenditures equal to 34% of incentive payment received. As a function of incentives received for
cash medical payments (due to legal prohibitions on remitting child support collections to Medicaid), this would result in a
net increase of department revenue of $65,801 per year, all else held equal.
REVENUE EXPLANATION CONTINUED ON PAGE TWO
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} x 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Alan M. Boxberger
13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} or a Net Fee Decrease {S} Staff Director
 LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 698 HLS 21RS 1088
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.: HB 186
Date: June 9, 2021 4:19 PM Author: BACALA
Dept./Agy.: LDH/DCFS
Subject: Interagency agreements to offset Medicaid costs Analyst: Shane Francis
CONTINUED EXPLANATION from page one: Page 2 of 2
REVENUE EXPLANATION CONTINUED FROM PAGE ONE
Incentive payments to DCFS do not constitute a loss of revenue to LDH, as the latter ensures that the 15% in incentive
payments in Proposed Legislation come from the federal share of medical support collections returned to CMS. As a result,
these funds are from monies that LDH does not currently retain and would have no fiscal impact on LDH.
Cash medical payments became mandatory in May 2018; below are its historic collections, the proposed 15% incentive
payment DCFS would receive, and the breakdown of that 15% into the foregone federal and state match. The first round of
federal stimulus payments are reflected in FY 20 and FY 21 and DCFS considers these values outliers. When omitted, the
average incentive fee collected would be $193,533, and this reflects the annual expenditure amount that would not be
submitted quarterly for Title IV-D reimbursement.
Amount of Payments Collected by FY 15% Incentive Federal Share State Share
FY 2018: $1,153,575 $173,036 $114,204 $58,832
FY 2019: $1,426,862 $214,029 $141,259 $72,770
FY 2020: $2,620,625 $393,094 $259,442 $133,652
FY 2021: $1,586,261 $237,939 $157,040 $80,899*
* July 1, 2020 - Feb. 28, 2021
DCFS does not anticipate a change in cash medical payment collections with the exclusion of children in child-only Medicaid
cases and those who have received good cause exemptions from the Medicaid Support Enforcement Services cooperation
requirement.
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} x 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Alan M. Boxberger
13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} or a Net Fee Decrease {S} Staff Director