Bill Text: TX HB335 | 2017-2018 | 85th Legislature | Introduced
Bill Title: Relating to administrative and judicial review of certain Medicaid reimbursement disputes; authorizing a fee.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-02-15 - Referred to Human Services [HB335 Detail]
Download: Texas-2017-HB335-Introduced.html
85R1823 KFF-F | ||
By: Collier | H.B. No. 335 |
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relating to administrative and judicial review of certain Medicaid | ||
reimbursement disputes; authorizing a fee. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subchapter A, Chapter 533, Government Code, is | ||
amended by adding Section 533.0057 to read as follows: | ||
Sec. 533.0057. CONFISCATORY REIMBURSEMENT RATES | ||
PROHIBITED; ADMINISTRATIVE AND JUDICIAL REVIEW OF CERTAIN | ||
REIMBURSEMENT DISPUTES. (a) In this section, "confiscatory" | ||
means, with respect to the reimbursement rate paid by a managed care | ||
organization to a provider, a rate that is below the rate necessary | ||
to: | ||
(1) recover the provider's reasonable operating | ||
expenses; | ||
(2) realize a reasonable return on the provider's | ||
costs; and | ||
(3) ensure confidence in the provider's continued: | ||
(A) financial integrity; and | ||
(B) participation in Medicaid. | ||
(b) A managed care organization may not pay a confiscatory | ||
reimbursement rate to a provider under a Medicaid managed care | ||
model or arrangement implemented under this chapter. | ||
(c) Notwithstanding any other law, a provider, including a | ||
pharmacy provider, has the right to a contested case hearing under | ||
Chapter 2001 to dispute the amount of a reimbursement rate paid to | ||
the provider by a managed care organization or the organization's | ||
pharmacy benefit manager if, subject to Subsection (f), the | ||
provider believes the rate is confiscatory in violation of | ||
Subsection (b), except that the decision of the hearing officer or | ||
the administrative law judge, as applicable, is not subject to | ||
judicial review under Chapter 2001. Solely for purposes of this | ||
section, a managed care organization is to be treated as a state | ||
agency under Chapter 2001. | ||
(d) A contested case hearing under Subsection (c) shall be | ||
conducted by an administrative law judge, unless the commission's | ||
appeals division employs at least one full-time hearing officer | ||
whose sole duty is to preside over contested cases. If the | ||
commission's appeals division employs a hearing officer described | ||
by this subsection, that officer shall conduct the contested case | ||
hearing under Subsection (c). | ||
(e) Parties to a contested case brought under this section: | ||
(1) must include: | ||
(A) the provider; and | ||
(B) the managed care organization and any | ||
appropriate agent of the organization, including a pharmacy benefit | ||
manager; and | ||
(2) may not include the commission. | ||
(f) If the provider's contract with the managed care | ||
organization or the organization's agent contains a process for | ||
handling disputes relating to provider reimbursement, the provider | ||
may request a contested case hearing under Subsection (c) only if: | ||
(1) the provider first submits the dispute for | ||
resolution through the contractual process; and | ||
(2) the managed care organization or the | ||
organization's agent, as appropriate, fails to resolve the dispute | ||
through the contractual process not later than the 45th day after | ||
the day the dispute is submitted, or if the provider is dissatisfied | ||
with the resolution of the contractual process. | ||
(g) In a contested case brought under this section, the | ||
hearing officer or administrative law judge, as applicable, shall | ||
determine whether the reimbursement rate is confiscatory and may | ||
order the managed care organization or the organization's agent to | ||
pay a rate that is not confiscatory. A hearing officer or | ||
administrative law judge, as applicable, may not award an amount: | ||
(1) to any one provider that, as a percentage of the | ||
provider's average net income before taxes, exceeds the managed | ||
care organization's percentage of net income before taxes that is | ||
computed in accordance with the contract between the organization | ||
and the commission and is authorized to be retained by the | ||
organization under that contract, averaged over all financial | ||
statistical reporting periods; or | ||
(2) that, in the aggregate, exceeds the amount of | ||
resources maintained by the managed care organization to reasonably | ||
accommodate program changes at no additional cost to the commission | ||
in accordance with the contract between the organization and the | ||
commission. | ||
(h) In a contested case brought under this section, the | ||
hearing officer or administrative law judge, as applicable, has the | ||
discretion: | ||
(1) considering the interest of judicial economy and | ||
efficiency, to combine cases wholly or partly that involve the same | ||
type of provider and the same or substantially similar | ||
reimbursement issues; or | ||
(2) to impose part or all of the costs for the hearing | ||
against the party or parties that do not substantially prevail. | ||
(i) In awarding costs in a contested case brought under this | ||
section, the hearing officer or administrative law judge, as | ||
applicable: | ||
(1) shall consider whether the position of the party | ||
was taken in good faith and had a reasonable basis in fact and law; | ||
and | ||
(2) may not award attorney's fees. | ||
(j) The commission or the State Office of Administrative | ||
Hearings may impose a fee in an amount not to exceed $500 on each | ||
party to a contested case brought under this section for the purpose | ||
of offsetting the costs of the hearing. | ||
SECTION 2. The change in law made by this Act applies only | ||
to a reimbursement paid to a Medicaid provider on or after the | ||
effective date of this Act. | ||
SECTION 3. 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 4. 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, 2017. |