According to the Legislative Budget Board (LBB), no significant fiscal implication to the State is anticipated from HB 5396. The LBB assumes that any administrative costs associated with implementing the bill's expansion of the Office of the State Long-Term Care Ombudsman's responsibilities can be absorbed using existing agency resources and would not require additional appropriations or new state funding.

The bill's fiscal impact is limited because it primarily expands the existing ombudsman program's authority to include oversight of rehabilitation hospitals rather than creating a new regulatory agency or licensing program. As a result, HHSC is expected to implement the new complaint investigation, reporting, and patient notification requirements within its current staffing and operational capacity.

The LBB also projects no significant fiscal implication for units of local government. Because the legislation does not impose substantial new responsibilities or costs on local governmental entities, counties, municipalities, and other local governments are not expected to experience a measurable fiscal impact as a result of the bill.

HB 5396 is substantially narrower than the originally filed bill and avoids creating a comprehensive licensing and regulatory regime for rehabilitation hospitals. However, it still expands the jurisdiction of the Office of the State Long-Term Care Ombudsman and directs the Health and Human Services Commission to adopt new rules implementing that authority. While these changes are limited in scope, they nonetheless increase the responsibilities and reach of existing state agencies.

The bill is not expected to have a significant fiscal impact, as the LBB concludes that implementation can be absorbed using existing resources. Nevertheless, assigning new responsibilities to existing agencies establishes an additional governmental function that could support future requests for staffing or appropriations. From a limited-government perspective, the absence of an immediate fiscal impact does not eliminate concerns about incremental government expansion.

The Committee Substitute also imposes new compliance requirements on rehabilitation hospitals by requiring them to cooperate with ombudsman investigations and post complaint notices throughout their facilities. Although these requirements are modest compared to the introduced version's licensing and enforcement framework, they nevertheless increase regulatory obligations on providers without clearly demonstrating that existing hospital oversight and complaint mechanisms are insufficient.

Because the bill expands state oversight into an additional category of health care facilities, modestly increases regulatory obligations, and establishes a precedent for broadening the jurisdiction of an existing state office without first exhausting existing enforcement mechanisms, the overall policy balance weighs against the legislation despite its limited fiscal impact. As such, Texas Policy Research recommends that lawmakers vote NO on HB 5396.

• Individual Liberty: The bill does not directly regulate individuals or restrict personal freedoms. However, it expands the authority of a state office to investigate complaints within rehabilitation hospitals and authorizes additional state intervention in private health care settings. While intended to protect vulnerable patients, it modestly increases government oversight rather than individual autonomy.
• Personal Responsibility: The bill neither encourages nor discourages individual responsibility. It does not create new entitlement programs or alter incentives for personal decision-making. Instead, it establishes an additional avenue for reporting and resolving complaints involving patients who may be in imminent peril.
• Free Enterprise: The bill imposes new compliance obligations on rehabilitation hospitals by requiring cooperation with ombudsman investigations and the posting of prescribed complaint notices. Although these requirements are relatively limited and far less burdensome than the introduced version's licensing regime, they nevertheless increase regulatory obligations on private providers.
• Private Property Rights: The bill does not affect ownership, use, or control of private property. It does not create new restrictions on property rights, authorize takings, or impose land-use requirements. While hospitals must post notices and cooperate with investigations, these operational requirements do not materially affect property rights.
• Limited Government: The bill expands the jurisdiction of the Office of the State Long-Term Care Ombudsman to include rehabilitation hospitals and directs the Health and Human Services Commission to adopt implementing rules. Although it avoids creating the broad licensing and enforcement framework proposed in the introduced bill and has no significant projected fiscal impact, it nevertheless increases the responsibilities and authority of existing state agencies and incrementally expands government oversight into an additional sector of health care.

• SB 699 (Same As)