Bill Text: TX SB207 | 2015-2016 | 84th Legislature | Enrolled
Bill Title: Relating to the authority and duties of the office of inspector general of the Health and Human Services Commission.
Spectrum: Slight Partisan Bill (Republican 5-2)
Status: (Passed) 2015-06-18 - Effective on 9/1/15 [SB207 Detail]
Download: Texas-2015-SB207-Enrolled.html
S.B. No. 207 |
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relating to the authority and duties of the office of inspector | ||
general of the Health and Human Services Commission. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 531.1011(4), Government Code, is amended | ||
to read as follows: | ||
(4) "Fraud" means an intentional deception or | ||
misrepresentation made by a person with the knowledge that the | ||
deception could result in some unauthorized benefit to that person | ||
or some other person[ |
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unintentional technical, clerical, or administrative errors. | ||
SECTION 2. Section 531.102, Government Code, is amended by | ||
amending Subsections (g) and (k), amending Subsection (f) as | ||
amended by S.B. No. 219, Acts of the 84th Legislature, Regular | ||
Session, 2015, and adding Subsections (a-2), (a-3), (a-4), (a-5), | ||
(a-6), (f-1), (p), (q), (r), (s), (t), (u), (v), and (w) to read as | ||
follows: | ||
(a-2) The executive commissioner shall work in consultation | ||
with the office whenever the executive commissioner is required by | ||
law to adopt a rule or policy necessary to implement a power or duty | ||
of the office, including a rule necessary to carry out a | ||
responsibility of the office under Subsection (a). | ||
(a-3) The executive commissioner is responsible for | ||
performing all administrative support services functions necessary | ||
to operate the office in the same manner that the executive | ||
commissioner is responsible for providing administrative support | ||
services functions for the health and human services system, | ||
including functions of the office related to the following: | ||
(1) procurement processes; | ||
(2) contracting policies; | ||
(3) information technology services; | ||
(4) legal services; | ||
(5) budgeting; and | ||
(6) personnel and employment policies. | ||
(a-4) The commission's internal audit division shall | ||
regularly audit the office as part of the commission's internal | ||
audit program and shall include the office in the commission's risk | ||
assessments. | ||
(a-5) The office shall closely coordinate with the | ||
executive commissioner and the relevant staff of health and human | ||
services system programs that the office oversees in performing | ||
functions relating to the prevention of fraud, waste, and abuse in | ||
the delivery of health and human services and the enforcement of | ||
state law relating to the provision of those services, including | ||
audits, utilization reviews, provider education, and data | ||
analysis. | ||
(a-6) The office shall conduct investigations independent | ||
of the executive commissioner and the commission but shall rely on | ||
the coordination required by Subsection (a-5) to ensure that the | ||
office has a thorough understanding of the health and human | ||
services system for purposes of knowledgeably and effectively | ||
performing the office's duties under this section and any other | ||
law. | ||
(f)(1) If the commission receives a complaint or allegation | ||
of Medicaid fraud or abuse from any source, the office must conduct | ||
a preliminary investigation as provided by Section 531.118(c) to | ||
determine whether there is a sufficient basis to warrant a full | ||
investigation. A preliminary investigation must begin not later | ||
than the 30th day, and be completed not later than the 45th day, | ||
after the date the commission receives a complaint or allegation or | ||
has reason to believe that fraud or abuse has occurred. [ |
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(2) If the findings of a preliminary investigation | ||
give the office reason to believe that an incident of fraud or abuse | ||
involving possible criminal conduct has occurred in Medicaid, the | ||
office must take the following action, as appropriate, not later | ||
than the 30th day after the completion of the preliminary | ||
investigation: | ||
(A) if a provider is suspected of fraud or abuse | ||
involving criminal conduct, the office must refer the case to the | ||
state's Medicaid fraud control unit, provided that the criminal | ||
referral does not preclude the office from continuing its | ||
investigation of the provider, which investigation may lead to the | ||
imposition of appropriate administrative or civil sanctions; or | ||
(B) if there is reason to believe that a | ||
recipient has defrauded Medicaid, the office may conduct a full | ||
investigation of the suspected fraud, subject to Section | ||
531.118(c). | ||
(f-1) The office shall complete a full investigation of a | ||
complaint or allegation of Medicaid fraud or abuse against a | ||
provider not later than the 180th day after the date the full | ||
investigation begins unless the office determines that more time is | ||
needed to complete the investigation. Except as otherwise provided | ||
by this subsection, if the office determines that more time is | ||
needed to complete the investigation, the office shall provide | ||
notice to the provider who is the subject of the investigation | ||
stating that the length of the investigation will exceed 180 days | ||
and specifying the reasons why the office was unable to complete the | ||
investigation within the 180-day period. The office is not | ||
required to provide notice to the provider under this subsection if | ||
the office determines that providing notice would jeopardize the | ||
investigation. | ||
(g)(1) Whenever the office learns or has reason to suspect | ||
that a provider's records are being withheld, concealed, destroyed, | ||
fabricated, or in any way falsified, the office shall immediately | ||
refer the case to the state's Medicaid fraud control | ||
unit. However, such criminal referral does not preclude the office | ||
from continuing its investigation of the provider, which | ||
investigation may lead to the imposition of appropriate | ||
administrative or civil sanctions. | ||
(2) As [ |
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under state and [ |
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Subdivisions (8) and (9), the office shall impose without prior | ||
notice a payment hold on claims for reimbursement submitted by a | ||
provider only to compel production of records, when requested by | ||
the state's Medicaid fraud control unit, or on the determination | ||
that a credible allegation of fraud exists, subject to Subsections | ||
(l) and (m), as applicable. The payment hold is a serious | ||
enforcement tool that the office imposes to mitigate ongoing | ||
financial risk to the state. A payment hold imposed under this | ||
subdivision takes effect immediately. The office must notify the | ||
provider of the payment hold in accordance with 42 C.F.R. Section | ||
455.23(b) and, except as provided by that regulation, not later | ||
than the fifth day after the date the office imposes the payment | ||
hold. In addition to the requirements of 42 C.F.R. Section | ||
455.23(b), the notice of payment hold provided under this | ||
subdivision must also include: | ||
(A) the specific basis for the hold, including | ||
identification of the claims supporting the allegation at that | ||
point in the investigation, [ |
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documents that form the basis for the hold, and a detailed summary | ||
of the office's evidence relating to the allegation; [ |
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(B) a description of administrative and judicial | ||
due process rights and remedies, including the provider's option | ||
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formal administrative appeal hearing, or that the provider may seek | ||
both; and | ||
(C) a detailed timeline for the provider to | ||
pursue the rights and remedies described in Paragraph (B). | ||
(3) On timely written request by a provider subject to | ||
a payment hold under Subdivision (2), other than a hold requested by | ||
the state's Medicaid fraud control unit, the office shall file a | ||
request with the State Office of Administrative Hearings for an | ||
expedited administrative hearing regarding the hold not later than | ||
the third day after the date the office receives the provider's | ||
request. The provider must request an expedited administrative | ||
hearing under this subdivision not later than the 10th [ |
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after the date the provider receives notice from the office under | ||
Subdivision (2). The State Office of Administrative Hearings shall | ||
hold the expedited administrative hearing not later than the 45th | ||
day after the date the State Office of Administrative Hearings | ||
receives the request for the hearing. In a hearing held under this | ||
subdivision [ |
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(A) the provider and the office are each limited | ||
to four hours of testimony, excluding time for responding to | ||
questions from the administrative law judge [ |
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(B) the provider and the office are each entitled | ||
to two continuances under reasonable circumstances [ |
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(C) the office is required to show probable cause | ||
that the credible allegation of fraud that is the basis of the | ||
payment hold has an indicia of reliability and that continuing to | ||
pay the provider presents an ongoing significant financial risk to | ||
the state and a threat to the integrity of Medicaid [ |
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(4) The office is responsible for the costs of a | ||
hearing held under Subdivision (3), but a provider is responsible | ||
for the provider's own costs incurred in preparing for the hearing | ||
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(5) In a hearing held under Subdivision (3), the | ||
administrative law judge shall decide if the payment hold should | ||
continue but may not adjust the amount or percent of the payment | ||
hold. Notwithstanding any other law, including Section | ||
2001.058(e), the decision of the administrative law judge is final | ||
and may not be appealed [ |
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(6) The executive commissioner, in consultation with | ||
the office, shall adopt rules that allow a provider subject to a | ||
payment hold under Subdivision (2), other than a hold requested by | ||
the state's Medicaid fraud control unit, to seek an informal | ||
resolution of the issues identified by the office in the notice | ||
provided under that subdivision. A provider must request an | ||
initial informal resolution meeting under this subdivision not | ||
later than the deadline prescribed by Subdivision (3) for | ||
requesting an expedited administrative hearing. On receipt of a | ||
timely request, the office shall decide whether to grant the | ||
provider's request for an initial informal resolution meeting, and | ||
if the office decides to grant the request, the office shall | ||
schedule the [ |
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shall give notice to the provider of the time and place of the | ||
initial informal resolution meeting [ |
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second informal resolution meeting [ |
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after the date of the initial informal resolution meeting. On | ||
receipt of a timely request, the office shall decide whether to | ||
grant the provider's request for a second informal resolution | ||
meeting, and if the office decides to grant the request, the office | ||
shall schedule the [ |
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office shall give notice to the provider of the time and place of | ||
the second informal resolution meeting [ |
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opportunity to provide additional information before the second | ||
informal resolution meeting for consideration by the office. A | ||
provider's decision to seek an informal resolution under this | ||
subdivision does not extend the time by which the provider must | ||
request an expedited administrative hearing under Subdivision (3). | ||
The informal resolution process shall run concurrently with the | ||
administrative hearing process, and the informal resolution | ||
process shall be discontinued once the State Office of | ||
Administrative Hearings issues a final determination on the payment | ||
hold. [ |
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(7) The office shall, in consultation with the state's | ||
Medicaid fraud control unit, establish guidelines under which | ||
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(A) may permissively be imposed on a provider; or | ||
(B) shall automatically be imposed on a provider. | ||
(7-a) The office shall, in consultation with the | ||
state's Medicaid fraud control unit, establish guidelines | ||
regarding the imposition of payment holds authorized under | ||
Subdivision (2). | ||
(8) In accordance with 42 C.F.R. Sections 455.23(e) | ||
and (f), on the determination that a credible allegation of fraud | ||
exists, the office may find that good cause exists to not impose a | ||
payment hold, to not continue a payment hold, to impose a payment | ||
hold only in part, or to convert a payment hold imposed in whole to | ||
one imposed only in part, if any of the following are applicable: | ||
(A) law enforcement officials have specifically | ||
requested that a payment hold not be imposed because a payment hold | ||
would compromise or jeopardize an investigation; | ||
(B) available remedies implemented by the state | ||
other than a payment hold would more effectively or quickly protect | ||
Medicaid funds; | ||
(C) the office determines, based on the | ||
submission of written evidence by the provider who is the subject of | ||
the payment hold, that the payment hold should be removed; | ||
(D) Medicaid recipients' access to items or | ||
services would be jeopardized by a full or partial payment hold | ||
because the provider who is the subject of the payment hold: | ||
(i) is the sole community physician or the | ||
sole source of essential specialized services in a community; or | ||
(ii) serves a large number of Medicaid | ||
recipients within a designated medically underserved area; | ||
(E) the attorney general declines to certify that | ||
a matter continues to be under investigation; or | ||
(F) the office determines that a full or partial | ||
payment hold is not in the best interests of Medicaid. | ||
(9) The office may not impose a payment hold on claims | ||
for reimbursement submitted by a provider for medically necessary | ||
services for which the provider has obtained prior authorization | ||
from the commission or a contractor of the commission unless the | ||
office has evidence that the provider has materially misrepresented | ||
documentation relating to those services. | ||
(k) A final report on an audit or investigation is subject | ||
to required disclosure under Chapter 552. All information and | ||
materials compiled during the audit or investigation remain | ||
confidential and not subject to required disclosure in accordance | ||
with Section 531.1021(g). A confidential draft report on an audit | ||
or investigation that concerns the death of a child may be shared | ||
with the Department of Family and Protective Services. A draft | ||
report that is shared with the Department of Family and Protective | ||
Services remains confidential and is not subject to disclosure | ||
under Chapter 552. | ||
(p) The executive commissioner, in consultation with the | ||
office, shall adopt rules establishing criteria: | ||
(1) for opening a case; | ||
(2) for prioritizing cases for the efficient | ||
management of the office's workload, including rules that direct | ||
the office to prioritize: | ||
(A) provider cases according to the highest | ||
potential for recovery or risk to the state as indicated through the | ||
provider's volume of billings, the provider's history of | ||
noncompliance with the law, and identified fraud trends; | ||
(B) recipient cases according to the highest | ||
potential for recovery and federal timeliness requirements; and | ||
(C) internal affairs investigations according to | ||
the seriousness of the threat to recipient safety and the risk to | ||
program integrity in terms of the amount or scope of fraud, waste, | ||
and abuse posed by the allegation that is the subject of the | ||
investigation; and | ||
(3) to guide field investigators in closing a case | ||
that is not worth pursuing through a full investigation. | ||
(q) The executive commissioner, in consultation with the | ||
office, shall adopt rules establishing criteria for determining | ||
enforcement and punitive actions with regard to a provider who has | ||
violated state law, program rules, or the provider's Medicaid | ||
provider agreement that include: | ||
(1) direction for categorizing provider violations | ||
according to the nature of the violation and for scaling resulting | ||
enforcement actions, taking into consideration: | ||
(A) the seriousness of the violation; | ||
(B) the prevalence of errors by the provider; | ||
(C) the financial or other harm to the state or | ||
recipients resulting or potentially resulting from those errors; | ||
and | ||
(D) mitigating factors the office determines | ||
appropriate; and | ||
(2) a specific list of potential penalties, including | ||
the amount of the penalties, for fraud and other Medicaid | ||
violations. | ||
(r) The office shall review the office's investigative | ||
process, including the office's use of sampling and extrapolation | ||
to audit provider records. The review shall be performed by staff | ||
who are not directly involved in investigations conducted by the | ||
office. | ||
(s) The office shall arrange for the Association of | ||
Inspectors General or a similar third party to conduct a peer review | ||
of the office's sampling and extrapolation techniques. Based on | ||
the review and generally accepted practices among other offices of | ||
inspectors general, the executive commissioner, in consultation | ||
with the office, shall by rule adopt sampling and extrapolation | ||
standards to be used by the office in conducting audits. | ||
(t) At each quarterly meeting of any advisory council | ||
responsible for advising the executive commissioner on the | ||
operation of the commission, the inspector general shall submit a | ||
report to the executive commissioner, the governor, and the | ||
legislature on: | ||
(1) the office's activities; | ||
(2) the office's performance with respect to | ||
performance measures established by the executive commissioner for | ||
the office; | ||
(3) fraud trends identified by the office; and | ||
(4) any recommendations for changes in policy to | ||
prevent or address fraud, waste, and abuse in the delivery of health | ||
and human services in this state. | ||
(u) The office shall publish each report required under | ||
Subsection (t) on the office's Internet website. | ||
(v) In accordance with Section 533.015(b), the office shall | ||
consult with the executive commissioner regarding the adoption of | ||
rules defining the office's role in and jurisdiction over, and the | ||
frequency of, audits of managed care organizations participating in | ||
Medicaid that are conducted by the office and the commission. | ||
(w) The office shall coordinate all audit and oversight | ||
activities relating to providers, including the development of | ||
audit plans, risk assessments, and findings, with the commission to | ||
minimize the duplication of activities. In coordinating activities | ||
under this subsection, the office shall: | ||
(1) on an annual basis, seek input from the commission | ||
and consider previous audits and on-site visits made by the | ||
commission for purposes of determining whether to audit a managed | ||
care organization participating in Medicaid; and | ||
(2) request the results of any informal audit or | ||
on-site visit performed by the commission that could inform the | ||
office's risk assessment when determining whether to conduct, or | ||
the scope of, an audit of a managed care organization participating | ||
in Medicaid. | ||
SECTION 3. Section 531.1021(a), Government Code, as amended | ||
by S.B. No. 219, Acts of the 84th Legislature, Regular Session, | ||
2015, is amended to read as follows: | ||
(a) The office of inspector general may issue [ |
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connection with an investigation conducted by the office. A [ |
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under this section to compel the attendance of a relevant witness or | ||
the production, for inspection or copying, of relevant evidence | ||
that is in this state. | ||
SECTION 4. Section 531.1031(a), Government Code, as amended | ||
by S.B. No. 219, Acts of the 84th Legislature, Regular Session, | ||
2015, is amended to read as follows: | ||
(a) In this section and Sections 531.1032, 531.1033, and | ||
531.1034: | ||
(1) "Health care professional" means a person issued a | ||
license[ |
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care profession. | ||
(1-a) "License" means a license, certificate, | ||
registration, permit, or other authorization that: | ||
(A) is issued by a licensing authority; and | ||
(B) must be obtained before a person may practice | ||
or engage in a particular business, occupation, or profession. | ||
(1-b) "Licensing authority" means a department, | ||
commission, board, office, or other agency of the state that issues | ||
a license. | ||
(1-c) "Office" means the commission's office of | ||
inspector general unless a different meaning is plainly required by | ||
the context in which the term appears. | ||
(2) "Participating agency" means: | ||
(A) the Medicaid fraud enforcement divisions of | ||
the office of the attorney general; | ||
(B) each licensing authority [ |
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with authority to issue a license to[ |
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that may participate in Medicaid; and | ||
(C) the [ |
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(3) "Provider" has the meaning assigned by Section | ||
531.1011(10)(A). | ||
SECTION 5. Subchapter C, Chapter 531, Government Code, is | ||
amended by adding Sections 531.1032, 531.1033, and 531.1034 to read | ||
as follows: | ||
Sec. 531.1032. OFFICE OF INSPECTOR GENERAL: CRIMINAL | ||
HISTORY RECORD INFORMATION CHECK. (a) The office and each | ||
licensing authority that requires the submission of fingerprints | ||
for the purpose of conducting a criminal history record information | ||
check of a health care professional shall enter into a memorandum of | ||
understanding to ensure that only persons who are licensed and in | ||
good standing as health care professionals participate as providers | ||
in Medicaid. The memorandum under this section may be combined with | ||
a memorandum authorized under Section 531.1031(c-1) and must | ||
include a process by which: | ||
(1) the office may confirm with a licensing authority | ||
that a health care professional is licensed and in good standing for | ||
purposes of determining eligibility to participate in Medicaid; and | ||
(2) the licensing authority immediately notifies the | ||
office if: | ||
(A) a provider's license has been revoked or | ||
suspended; or | ||
(B) the licensing authority has taken | ||
disciplinary action against a provider. | ||
(b) The office may not, for purposes of determining a health | ||
care professional's eligibility to participate in Medicaid as a | ||
provider, conduct a criminal history record information check of a | ||
health care professional who the office has confirmed under | ||
Subsection (a) is licensed and in good standing. This subsection | ||
does not prohibit the office from performing a criminal history | ||
record information check of a provider that is required or | ||
appropriate for other reasons, including for conducting an | ||
investigation of fraud, waste, or abuse. | ||
(c) For purposes of determining eligibility to participate | ||
in Medicaid and subject to Subsection (d), the office, after | ||
seeking public input, shall establish and the executive | ||
commissioner by rule shall adopt guidelines for the evaluation of | ||
criminal history record information of providers and potential | ||
providers. The guidelines must outline conduct, by provider type, | ||
that may be contained in criminal history record information that | ||
will result in exclusion of a person from Medicaid as a provider, | ||
taking into consideration: | ||
(1) the extent to which the underlying conduct relates | ||
to the services provided under Medicaid; | ||
(2) the degree to which the person would interact with | ||
Medicaid recipients as a provider; and | ||
(3) any previous evidence that the person engaged in | ||
fraud, waste, or abuse under Medicaid. | ||
(d) The guidelines adopted under Subsection (c) may not | ||
impose stricter standards for the eligibility of a person to | ||
participate in Medicaid than a licensing authority described by | ||
Subsection (a) requires for the person to engage in a health care | ||
profession without restriction in this state. | ||
(e) The office and the commission shall use the guidelines | ||
adopted under Subsection (c) to determine whether a provider | ||
participating in Medicaid continues to be eligible to participate | ||
in Medicaid as a provider. | ||
(f) The provider enrollment contractor, if applicable, and | ||
a managed care organization participating in Medicaid shall defer | ||
to the office regarding whether a person's criminal history record | ||
information precludes the person from participating in Medicaid as | ||
a provider. | ||
Sec. 531.1033. MONITORING OF CERTAIN FEDERAL DATABASES. | ||
The office shall routinely check appropriate federal databases, | ||
including databases referenced in 42 C.F.R. Section 455.436, to | ||
ensure that a person who is excluded from participating in Medicaid | ||
or in the Medicare program by the federal government is not | ||
participating as a provider in Medicaid. | ||
Sec. 531.1034. TIME TO DETERMINE PROVIDER ELIGIBILITY; | ||
PERFORMANCE METRICS. (a) Not later than the 10th day after the | ||
date the office receives the complete application of a health care | ||
professional seeking to participate in Medicaid, the office shall | ||
inform the commission or the health care professional, as | ||
appropriate, of the office's determination regarding whether the | ||
health care professional should be denied participation in Medicaid | ||
based on: | ||
(1) information concerning the licensing status of the | ||
health care professional obtained as described by Section | ||
531.1032(a); | ||
(2) information contained in the criminal history | ||
record information check that is evaluated in accordance with | ||
guidelines adopted under Section 531.1032(c); | ||
(3) a review of federal databases under Section | ||
531.1033; | ||
(4) the pendency of an open investigation by the | ||
office; or | ||
(5) any other reason the office determines | ||
appropriate. | ||
(b) Completion of an on-site visit of a health care | ||
professional during the period prescribed by Subsection (a) is not | ||
required. | ||
(c) The office shall develop performance metrics to measure | ||
the length of time for conducting a determination described by | ||
Subsection (a) with respect to applications that are complete when | ||
submitted and all other applications. | ||
SECTION 6. Section 531.113, Government Code, is amended by | ||
adding Subsection (d-1) and amending Subsection (e) as amended by | ||
S.B. No. 219, Acts of the 84th Legislature, Regular Session, 2015, | ||
to read as follows: | ||
(d-1) The commission's office of inspector general, in | ||
consultation with the commission, shall: | ||
(1) investigate, including by means of regular audits, | ||
possible fraud, waste, and abuse by managed care organizations | ||
subject to this section; | ||
(2) establish requirements for the provision of | ||
training to and regular oversight of special investigative units | ||
established by managed care organizations under Subsection (a)(1) | ||
and entities with which managed care organizations contract under | ||
Subsection (a)(2); | ||
(3) establish requirements for approving plans to | ||
prevent and reduce fraud and abuse adopted by managed care | ||
organizations under Subsection (b); | ||
(4) evaluate statewide fraud, waste, and abuse trends | ||
in Medicaid and communicate those trends to special investigative | ||
units and contracted entities to determine the prevalence of those | ||
trends; | ||
(5) assist managed care organizations in discovering | ||
or investigating fraud, waste, and abuse, as needed; and | ||
(6) provide ongoing, regular training to appropriate | ||
commission and office staff concerning fraud, waste, and abuse in a | ||
managed care setting, including training relating to fraud, waste, | ||
and abuse by service providers and recipients. | ||
(e) The executive commissioner, in consultation with the | ||
office, shall adopt rules as necessary to accomplish the purposes | ||
of this section, including rules defining the investigative role of | ||
the commission's office of inspector general with respect to the | ||
investigative role of special investigative units established by | ||
managed care organizations under Subsection (a)(1) and entities | ||
with which managed care organizations contract under Subsection | ||
(a)(2). The rules adopted under this section must specify the | ||
office's role in: | ||
(1) reviewing the findings of special investigative | ||
units and contracted entities; | ||
(2) investigating cases in which the overpayment | ||
amount sought to be recovered exceeds $100,000; and | ||
(3) investigating providers who are enrolled in more | ||
than one managed care organization. | ||
SECTION 7. Section 531.118(b), Government Code, is amended | ||
to read as follows: | ||
(b) If the commission receives an allegation of fraud or | ||
abuse against a provider from any source, the commission's office | ||
of inspector general shall conduct a preliminary investigation of | ||
the allegation to determine whether there is a sufficient basis to | ||
warrant a full investigation. A preliminary investigation must | ||
begin not later than the 30th day, and be completed not later than | ||
the 45th day, after the date the commission receives or identifies | ||
an allegation of fraud or abuse. | ||
SECTION 8. Section 531.120, Government Code, is amended to | ||
read as follows: | ||
Sec. 531.120. NOTICE AND INFORMAL RESOLUTION OF PROPOSED | ||
RECOUPMENT OF OVERPAYMENT OR DEBT. (a) The commission or the | ||
commission's office of inspector general shall provide a provider | ||
with written notice of any proposed recoupment of an overpayment or | ||
debt and any damages or penalties relating to a proposed recoupment | ||
of an overpayment or debt arising out of a fraud or abuse | ||
investigation. The notice must include: | ||
(1) the specific basis for the overpayment or debt; | ||
(2) a description of facts and supporting evidence; | ||
(3) a representative sample of any documents that form | ||
the basis for the overpayment or debt; | ||
(4) the extrapolation methodology; | ||
(4-a) information relating to the extrapolation | ||
methodology used as part of the investigation and the methods used | ||
to determine the overpayment or debt in sufficient detail so that | ||
the extrapolation results may be demonstrated to be statistically | ||
valid and are fully reproducible; | ||
(5) the calculation of the overpayment or debt amount; | ||
(6) the amount of damages and penalties, if | ||
applicable; and | ||
(7) a description of administrative and judicial due | ||
process remedies, including the provider's option [ |
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informal resolution, the provider's right to seek a formal | ||
administrative appeal hearing, or that the provider may seek both. | ||
(b) A provider may [ |
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office shall give notice to the provider of the time and place of | ||
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resolution process shall run concurrently with the administrative | ||
hearing process, and the administrative hearing process may not be | ||
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SECTION 9. Sections 531.1201(a) and (b), Government Code, | ||
are amended to read as follows: | ||
(a) A provider must request an appeal under this section not | ||
later than the 30th [ |
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notified that the commission or the commission's office of | ||
inspector general will seek to recover an overpayment or debt from | ||
the provider. On receipt of a timely written request by a provider | ||
who is the subject of a recoupment of overpayment or recoupment of | ||
debt arising out of a fraud or abuse investigation, the office of | ||
inspector general shall file a docketing request with the State | ||
Office of Administrative Hearings or the Health and Human Services | ||
Commission appeals division, as requested by the provider, for an | ||
administrative hearing regarding the proposed recoupment amount | ||
and any associated damages or penalties. The office shall file the | ||
docketing request under this section not later than the 60th day | ||
after the date of the provider's request for an administrative | ||
hearing or not later than the 60th day after the completion of the | ||
informal resolution process, if applicable. | ||
(b) The commission's office of inspector general is | ||
responsible for the costs of an administrative hearing held under | ||
Subsection (a), but a provider is responsible for the provider's | ||
own costs incurred in preparing for the hearing [ |
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SECTION 10. Section 531.1202, Government Code, is amended | ||
to read as follows: | ||
Sec. 531.1202. RECORD AND CONFIDENTIALITY OF INFORMAL | ||
RESOLUTION MEETINGS. (a) On the written request of the provider, | ||
the [ |
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requested the meeting, provide for an informal resolution meeting | ||
held under Section 531.102(g)(6) or 531.120(b) to be recorded. The | ||
recording of an informal resolution meeting shall be made available | ||
to the provider who requested the meeting. The commission may not | ||
record an informal resolution meeting unless the commission | ||
receives a written request from a provider under this subsection. | ||
(b) Notwithstanding Section 531.1021(g) and except as | ||
provided by this section, an informal resolution meeting held under | ||
Section 531.102(g)(6) or 531.120(b) is confidential, and any | ||
information or materials obtained by the commission's office of | ||
inspector general, including the office's employees or the office's | ||
agents, during or in connection with an informal resolution | ||
meeting, including a recording made under Subsection (a), are | ||
privileged and confidential and not subject to disclosure under | ||
Chapter 552 or any other means of legal compulsion for release, | ||
including disclosure, discovery, or subpoena. | ||
SECTION 11. Subchapter C, Chapter 531, Government Code, is | ||
amended by adding Sections 531.1023, 531.1024, 531.1025, and | ||
531.1203 to read as follows: | ||
Sec. 531.1023. COMPLIANCE WITH FEDERAL CODING GUIDELINES. | ||
The commission's office of inspector general, including office | ||
staff and any third party with which the office contracts to perform | ||
coding services, shall comply with federal coding guidelines, | ||
including guidelines for diagnosis-related group (DRG) validation | ||
and related audits. | ||
Sec. 531.1024. HOSPITAL UTILIZATION REVIEWS AND AUDITS: | ||
PROVIDER EDUCATION PROCESS. The executive commissioner, in | ||
consultation with the office, shall by rule develop a process for | ||
the commission's office of inspector general, including office | ||
staff and any third party with which the office contracts to perform | ||
coding services, to communicate with and educate providers about | ||
the diagnosis-related group (DRG) validation criteria that the | ||
office uses in conducting hospital utilization reviews and audits. | ||
Sec. 531.1025. PERFORMANCE AUDITS AND COORDINATION OF AUDIT | ||
ACTIVITIES. (a) Notwithstanding any other law, the commission's | ||
office of inspector general may conduct a performance audit of any | ||
program or project administered or agreement entered into by the | ||
commission or a health and human services agency, including an | ||
audit related to: | ||
(1) contracting procedures of the commission or a | ||
health and human services agency; or | ||
(2) the performance of the commission or a health and | ||
human services agency. | ||
(b) In addition to the coordination required by Section | ||
531.102(w), the office shall coordinate the office's other audit | ||
activities with those of the commission, including the development | ||
of audit plans, the performance of risk assessments, and the | ||
reporting of findings, to minimize the duplication of audit | ||
activities. In coordinating audit activities with the commission | ||
under this subsection, the office shall: | ||
(1) seek input from the commission and consider | ||
previous audits conducted by the commission for purposes of | ||
determining whether to conduct a performance audit; and | ||
(2) request the results of an audit conducted by the | ||
commission if those results could inform the office's risk | ||
assessment when determining whether to conduct, or the scope of, a | ||
performance audit. | ||
Sec. 531.1203. RIGHTS OF AND PROVISION OF INFORMATION TO | ||
PHARMACIES SUBJECT TO CERTAIN AUDITS. (a) A pharmacy has a right | ||
to request an informal hearing before the commission's appeals | ||
division to contest the findings of an audit conducted by the | ||
commission's office of inspector general or an entity that | ||
contracts with the federal government to audit Medicaid providers | ||
if the findings of the audit do not include findings that the | ||
pharmacy engaged in Medicaid fraud. | ||
(b) In an informal hearing held under this section, staff of | ||
the commission's appeals division, assisted by staff responsible | ||
for the commission's vendor drug program who have expertise in the | ||
law governing pharmacies' participation in Medicaid, make the final | ||
decision on whether the findings of an audit are accurate. Staff of | ||
the commission's office of inspector general may not serve on the | ||
panel that makes the decision on the accuracy of an audit. | ||
(c) In order to increase transparency, the commission's | ||
office of inspector general shall, if the office has access to the | ||
information, provide to pharmacies that are subject to audit by the | ||
office, or by an entity that contracts with the federal government | ||
to audit Medicaid providers, information relating to the | ||
extrapolation methodology used as part of the audit and the methods | ||
used to determine whether the pharmacy has been overpaid under | ||
Medicaid in sufficient detail so that the audit results may be | ||
demonstrated to be statistically valid and are fully reproducible. | ||
SECTION 12. Section 533.015, Government Code, as amended by | ||
S.B. No. 219, Acts of the 84th Legislature, Regular Session, 2015, | ||
is amended to read as follows: | ||
Sec. 533.015. COORDINATION OF EXTERNAL OVERSIGHT | ||
ACTIVITIES. (a) To the extent possible, the commission shall | ||
coordinate all external oversight activities to minimize | ||
duplication of oversight of managed care plans under Medicaid and | ||
disruption of operations under those plans. | ||
(b) The executive commissioner, after consulting with the | ||
commission's office of inspector general, shall by rule define the | ||
commission's and office's roles in and jurisdiction over, and | ||
frequency of, audits of managed care organizations participating in | ||
Medicaid that are conducted by the commission and the commission's | ||
office of inspector general. | ||
(c) In accordance with Section 531.102(w), the commission | ||
shall share with the commission's office of inspector general, at | ||
the request of the office, the results of any informal audit or | ||
on-site visit that could inform that office's risk assessment when | ||
determining whether to conduct, or the scope of, an audit of a | ||
managed care organization participating in Medicaid. | ||
SECTION 13. The following provisions are repealed: | ||
(1) Section 531.1201(c), Government Code; and | ||
(2) Section 32.0422(k), Human Resources Code, as | ||
amended by S.B. No. 219, Acts of the 84th Legislature, Regular | ||
Session, 2015. | ||
SECTION 14. Notwithstanding Section 531.004, Government | ||
Code, the Sunset Advisory Commission shall conduct a | ||
special-purpose review of the overall performance of the Health and | ||
Human Services Commission's office of inspector general. In | ||
conducting the review, the Sunset Advisory Commission shall | ||
particularly focus on the office's investigations and the | ||
effectiveness and efficiency of the office's processes, as part of | ||
the Sunset Advisory Commission's review of agencies for the 87th | ||
Legislature. The office is not abolished solely because the office | ||
is not explicitly continued following the review. | ||
SECTION 15. Section 531.102, Government Code, as amended by | ||
this Act, applies only to a complaint or allegation of Medicaid | ||
fraud or abuse received by the Health and Human Services Commission | ||
or the commission's office of inspector general on or after the | ||
effective date of this Act. A complaint or allegation received | ||
before the effective date of this Act is governed by the law as it | ||
existed when the complaint or allegation was received, and the | ||
former law is continued in effect for that purpose. | ||
SECTION 16. Not later than March 1, 2016, the executive | ||
commissioner of the Health and Human Services Commission, in | ||
consultation with the inspector general of the commission's office | ||
of inspector general, shall adopt rules necessary to implement the | ||
changes in law made by this Act to Section 531.102(g)(2), | ||
Government Code, regarding the circumstances in which a payment | ||
hold may be placed on claims for reimbursement submitted by a | ||
Medicaid provider. | ||
SECTION 17. As soon as practicable after the effective date | ||
of this Act, the executive commissioner of the Health and Human | ||
Services Commission, in consultation with the inspector general of | ||
the commission's office of inspector general, shall adopt the rules | ||
establishing the process for communicating with and educating | ||
providers about diagnosis-related group (DRG) validation criteria | ||
under Section 531.1024, Government Code, as added by this Act. | ||
SECTION 18. Not later than September 1, 2016, the executive | ||
commissioner of the Health and Human Services Commission shall | ||
adopt the guidelines required under Section 531.1032(c), | ||
Government Code, as added by this Act. | ||
SECTION 19. Sections 531.120 and 531.1201, Government Code, | ||
as amended by this Act, apply only to a proposed recoupment of an | ||
overpayment or debt of which a provider is notified on or after the | ||
effective date of this Act. A proposed recoupment of an overpayment | ||
or debt that a provider was notified of before the effective date of | ||
this Act is governed by the law as it existed when the provider was | ||
notified, and the former law is continued in effect for that | ||
purpose. | ||
SECTION 20. Not later than March 1, 2016, the executive | ||
commissioner of the Health and Human Services Commission in | ||
consultation with the inspector general of the office of inspector | ||
general shall adopt rules necessary to implement Section 531.1203, | ||
Government Code, as added by this Act. | ||
SECTION 21. Not later than September 1, 2016, the executive | ||
commissioner of the Health and Human Services Commission shall | ||
adopt rules required by Section 533.015(b), Government Code, as | ||
added by this Act. | ||
SECTION 22. 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 23. This Act takes effect September 1, 2015. | ||
______________________________ | ______________________________ | |
President of the Senate | Speaker of the House | |
I hereby certify that S.B. No. 207 passed the Senate on | ||
April 21, 2015, by the following vote: Yeas 30, Nays 0; | ||
May 26, 2015, Senate refused to concur in House amendment and | ||
requested appointment of Conference Committee; May 27, 2015, House | ||
granted request of the Senate; May 30, 2015, Senate adopted | ||
Conference Committee Report by the following vote: Yeas 30, | ||
Nays 1. | ||
______________________________ | ||
Secretary of the Senate | ||
I hereby certify that S.B. No. 207 passed the House, with | ||
amendment, on May 24, 2015, by the following vote: Yeas 142, | ||
Nays 0, two present not voting; May 27, 2015, House granted request | ||
of the Senate for appointment of Conference Committee; | ||
May 30, 2015, House adopted Conference Committee Report by the | ||
following vote: Yeas 144, Nays 0, two present not voting. | ||
______________________________ | ||
Chief Clerk of the House | ||
Approved: | ||
______________________________ | ||
Date | ||
______________________________ | ||
Governor |