Bill Text: TX HB3348 | 2025-2026 | 89th Legislature | Enrolled

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Bill Title: Relating to the creation and operations of a health care provider participation program in certain counties.

Sponsorship: Moderate Partisan Bill (Republican 5-1)

Status: (Passed) 2025-06-20 - Effective immediately [HB3348 Detail]

Download: Texas-2025-HB3348-Enrolled.html

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H.B. No. 3348

AN ACT
relating to the creation and operations of a health care provider
participation program in certain counties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle D, Title 4, Health and Safety Code, is
amended by adding Chapter 292E to read as follows:
CHAPTER 292E. COUNTY HEALTH CARE PROVIDER PARTICIPATION PROGRAM IN
CERTAIN COUNTIES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 292E.001. DEFINITIONS. In this chapter:
(1) "Institutional health care provider" means a
nonpublic hospital that provides inpatient hospital services.
(2) "Paying hospital" means an institutional health
care provider required to make a mandatory payment under this
chapter.
(3) "Program" means a county health care provider
participation program authorized by this chapter.
Sec. 292E.002. APPLICABILITY. This chapter applies only to
a county that:
(1) is not served by a hospital district; and
(2) is:
(A) a county that:
(i) has a population of more than 46,000 and
less than 50,000; and
(ii) is adjacent to the county containing
the state capital;
(B) a county that:
(i) has a population of 900,000 or more; and
(ii) borders two counties, each of which
has a population of two million or more; or
(C) a county that:
(i) has a population of one million or more;
(ii) contains all or part of a municipality
with a population of one million or more; and
(iii) is adjacent to a county with a
population of 2.5 million or more.
Sec. 292E.003. COUNTY HEALTH CARE PROVIDER PARTICIPATION
PROGRAM; PARTICIPATION IN PROGRAM. (a) A county health care
provider participation program authorizes a county to collect a
mandatory payment from each institutional health care provider
located in the county to be deposited in a local provider
participation fund established by the county. Money in the fund may
be used by the county as provided by Section 292E.103(b).
(b) The commissioners court of a county may adopt an order
authorizing the county to participate in the program, subject to
the limitations provided by this chapter.
SUBCHAPTER B. POWERS AND DUTIES OF COMMISSIONERS COURT
Sec. 292E.051. LIMITATION ON AUTHORITY TO REQUIRE MANDATORY
PAYMENTS. The commissioners court of a county may require a
mandatory payment under this chapter by an institutional health
care provider in the county only in the manner provided by this
chapter.
Sec. 292E.052. MAJORITY VOTE REQUIRED. The commissioners
court of a county may not authorize the county to collect a
mandatory payment under this chapter without an affirmative vote of
a majority of the members of the commissioners court.
Sec. 292E.053. RULES AND PROCEDURES. After the
commissioners court of a county has voted to require a mandatory
payment authorized under this chapter, the commissioners court may
adopt rules relating to the administration of the program,
including the collection of a mandatory payment, expenditures, an
audit, and any other administrative aspect of the program.
Sec. 292E.054. INSTITUTIONAL HEALTH CARE PROVIDER
REPORTING. (a) The commissioners court of a county that authorizes
the county to participate in a program under this chapter shall
require each institutional health care provider located in the
county to submit to the county a copy of any financial and
utilization data required by and reported to the Department of
State Health Services under Sections 311.032 and 311.033 and any
rules adopted by the executive commissioner of the Health and Human
Services Commission to implement those sections.
(b) The commissioners court may inspect the records of an
institutional health care provider in the county to the extent
necessary to ensure compliance with the requirements of Subsection
(a).
SUBCHAPTER C. GENERAL FINANCIAL PROVISIONS
Sec. 292E.101. HEARING. (a) In each year that the
commissioners court of a county authorizes a mandatory payment
under this chapter, the commissioners court shall hold a public
hearing on the amounts of any mandatory payments that the county
intends to require during the year and how the revenue derived from
those payments is to be spent.
(b) Not later than the fifth day before the date of the
hearing required under Subsection (a), the commissioners court
shall publish notice of the hearing in a newspaper of general
circulation in the county and provide written notice of the hearing
to each institutional health care provider located in the county.
(c) A representative of a paying hospital is entitled to
appear at the public hearing and be heard regarding any matter
related to the mandatory payments authorized under this chapter.
Sec. 292E.102. LOCAL PROVIDER PARTICIPATION FUND;
DEPOSITORY. (a) The commissioners court of a county that requires
a mandatory payment under this chapter shall create a local
provider participation fund.
(b) If the commissioners court of a county creates a local
provider participation fund, the commissioners court shall
designate one or more banks as the depository for the county's local
provider participation fund.
(c) The commissioners court may withdraw or use money in the
county's local provider participation fund only for a purpose
authorized under this chapter.
(d) All funds collected under this chapter shall be secured
in the manner provided for securing other funds of the county.
Sec. 292E.103. LOCAL PROVIDER PARTICIPATION FUND;
AUTHORIZED USES OF MONEY. (a) The local provider participation
fund established by a county under Section 292E.102 consists of:
(1) all revenue received by the county attributable to
mandatory payments authorized under this chapter, including any
penalties and interest attributable to delinquent payments;
(2) money received from the Health and Human Services
Commission as a refund of an intergovernmental transfer described
by Subsection (b)(1), provided that the intergovernmental transfer
does not receive a federal matching payment; and
(3) the earnings of the fund.
(b) Money deposited to a county's local provider
participation fund may be used only to:
(1) fund intergovernmental transfers from the county
to the state to provide the nonfederal share of Medicaid payments
for:
(A) uncompensated care payments to nonpublic
hospitals authorized under the Texas Healthcare Transformation and
Quality Improvement Program waiver issued under Section 1115 of the
federal Social Security Act (42 U.S.C. Section 1315), or a
successor waiver program authorizing similar Medicaid supplemental
payment programs;
(B) uniform rate enhancements or other directed
payment programs for nonpublic hospitals;
(C) payments available under another waiver
program authorizing payments that are substantially similar to
Medicaid payments to nonpublic hospitals described by Paragraph (A)
or (B); or
(D) any reimbursement to nonpublic hospitals, or
that may benefit nonpublic hospitals as determined by the
commissioners court, for which federal matching funds are
available;
(2) subject to Section 292E.151(e), pay the
administrative expenses of the county in administering the program,
including collateralization of deposits;
(3) refund all or a portion of a mandatory payment
collected in error from a paying hospital; and
(4) refund to paying hospitals a proportionate share
of the money that the county:
(A) receives from the Health and Human Services
Commission that is not used to fund the nonfederal share of Medicaid
supplemental payment program payments; or
(B) determines cannot be used to fund the
nonfederal share of Medicaid supplemental payment program
payments.
(c) Money in the local provider participation fund may not
be commingled with other county money.
(d) Notwithstanding any other provision of this chapter,
with respect to an intergovernmental transfer of funds described by
Subsection (b)(1) made by the county, any funds received by the
state, county, or other entity as a result of the transfer may not
be used by the state, county, or other entity to:
(1) expand Medicaid eligibility under the Patient
Protection and Affordable Care Act (Pub. L. No. 111-148) as amended
by the Health Care and Education Reconciliation Act of 2010 (Pub. L.
No. 111-152); or
(2) fund the nonfederal share of payments to nonpublic
hospitals available through the Medicaid disproportionate share
hospital program.
SUBCHAPTER D. MANDATORY PAYMENTS
Sec. 292E.151. MANDATORY PAYMENTS BASED ON PAYING HOSPITAL
NET PATIENT REVENUE. (a) Except as provided by Subsection (f), if
the commissioners court of a county authorizes a program under this
chapter, the commissioners court shall require an annual mandatory
payment to be assessed on the net patient revenue of each
institutional health care provider located in the county. The
commissioners court shall provide for the mandatory payment to be
assessed quarterly. In the first year in which the mandatory
payment is required, the mandatory payment is assessed on the net
patient revenue of an institutional health care provider as
determined by the data reported to the Department of State Health
Services under Sections 311.032 and 311.033 in the most recent
fiscal year for which that data was reported. If the institutional
health care provider did not report any data under those sections,
the provider's net patient revenue is the amount of that revenue as
contained in the provider's Medicare cost report submitted for the
most recent fiscal year for which the provider submitted the
Medicare cost report. The commissioners court shall update the
amount of the mandatory payment on an annual basis.
(b) The commissioners court of a county that requires a
mandatory payment under this chapter shall provide each
institutional health care provider on which the payment will be
assessed written notice of an assessment under this chapter. The
institutional health care provider must pay the assessment not
later than the 30th day after the date the provider receives the
written notice.
(c) The amount of a mandatory payment authorized under this
chapter must be uniformly proportionate with the amount of net
patient revenue generated by each paying hospital in the county. A
program may not hold harmless any institutional health care
provider, as required under 42 U.S.C. Section 1396b(w) and 42
C.F.R. Section 433.68.
(d) The commissioners court of a county that requires a
mandatory payment under this chapter shall set the amount of the
mandatory payment. The aggregate amount of the mandatory payment
required of all paying hospitals in the county may not exceed six
percent of the aggregate net patient revenue from hospital services
provided by all paying hospitals in the county.
(e) Subject to Subsection (d), the commissioners court of a
county that requires a mandatory payment under this chapter shall
set the mandatory payments in amounts that in the aggregate will
generate sufficient revenue to cover the administrative expenses of
the county for activities under this chapter and to fund an
intergovernmental transfer described by Section 292E.103(b)(1).
The annual amount of revenue from mandatory payments that may be
used to pay the administrative expenses of the county for
activities under this chapter may not exceed the following amounts,
plus the collateralization of deposits, regardless of the actual
expenses:
(1) for a county described by Section 292E.002(2)(A),
$20,000;
(2) for a county described by Section 292E.002(2)(B),
$150,000; or
(3) for a county described by Section 292E.002(2)(C),
$300,000.
(f) A paying hospital may not add a mandatory payment
required under this section as a surcharge to a patient.
Sec. 292E.152. ASSESSMENT AND COLLECTION OF MANDATORY
PAYMENTS. (a) The county may collect or contract for the assessment
and collection of mandatory payments authorized under this chapter.
(b) The person charged by the county with the assessment and
collection of mandatory payments shall charge and deduct from the
mandatory payments collected for the county a collection fee in an
amount not to exceed the person's usual and customary charges for
like services.
(c) If the person charged with the assessment and collection
of mandatory payments is an official of the county, any revenue from
a collection fee charged under Subsection (b) shall be deposited in
the county general fund and, if appropriate, shall be reported as
fees of the county.
Sec. 292E.153. PURPOSE; CORRECTION OF INVALID PROVISION OR
PROCEDURE; LIMITATION OF AUTHORITY. (a) The purpose of this
chapter is to authorize a county to establish a program to enable
the county to collect mandatory payments from institutional health
care providers to fund the nonfederal share of certain Medicaid
programs as described by Section 292E.103(b)(1).
(b) To the extent any provision or procedure under this
chapter causes a mandatory payment authorized under this chapter to
be ineligible for federal matching funds, the commissioners court
of the county administering the program may provide by rule for an
alternative provision or procedure that conforms to the
requirements of the federal Centers for Medicare and Medicaid
Services. A rule adopted under this section may not create, impose,
or materially expand the legal or financial liability or
responsibility of the county or an institutional health care
provider located in the county beyond the provisions of this
chapter. This section does not require the commissioners court of a
county to adopt a rule.
(c) A county administering a program may only assess and
collect a mandatory payment authorized under this chapter if a
waiver program, uniform rate enhancement, or reimbursement
described by Section 292E.103(b)(1) is available to the county.
(d) This chapter does not authorize a county administering a
program to collect mandatory payments for the purpose of raising
general revenue or any amount in excess of the amount reasonably
necessary to fund the nonfederal share of a Medicaid supplemental
payment program or Medicaid managed care rate enhancements for
nonpublic hospitals and to cover the administrative expenses of the
county associated with activities under this chapter.
Sec. 292E.154. REPORTING REQUIREMENTS. (a) The
commissioners court of a county that authorizes a program under
this chapter shall report information to the Health and Human
Services Commission regarding the program on a schedule determined
by the commission.
(b) The information must include:
(1) the amount of the mandatory payments required and
collected in each year the program is authorized; and
(2) any expenditure or other use of money attributable
to mandatory payments collected under this chapter.
(c) The executive commissioner of the Health and Human
Services Commission may adopt rules to administer this section.
Sec. 292E.155. AUTHORITY TO REFUSE FOR VIOLATION. The
Health and Human Services Commission may refuse to accept money
from a local provider participation fund administered under this
chapter if the commission determines that acceptance of the money
may violate federal law.
Sec. 292E.156. INTEREST AND PENALTIES. The county may
impose and collect interest and penalties on delinquent mandatory
payments assessed under this chapter in any amount that does not
exceed the maximum amount authorized for other delinquent payments
owed to the county.
SECTION 2. If before implementing any provision of this Act
a state agency determines that a waiver or authorization from a
federal agency is necessary for implementation of that provision,
the agency affected by the provision shall request the waiver or
authorization and may delay implementing that provision until the
waiver or authorization is granted.
SECTION 3. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 3348 was passed by the House on May 6,
2025, by the following vote: Yeas 124, Nays 19, 2 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 3348 on May 28, 2025, by the following vote: Yeas 106, Nays 29,
1 present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 3348 was passed by the Senate, with
amendments, on May 22, 2025, by the following vote: Yeas 29, Nays
2.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor