Bill Text: TX SB2256 | 2019-2020 | 86th Legislature | Introduced

---

Bill Title: Relating to the creation and operations of health care provider participation programs in local jurisdictions in this state.

Sponsorship: Partisan Bill (Republican 1)

Status: (Introduced - Dead) 2019-03-21 - Referred to Health & Human Services [SB2256 Detail]

Download: Texas-2019-SB2256-Introduced.html

---

By: Kolkhorst S.B. No. 2256

A BILL TO BE ENTITLED
AN ACT
relating to the creation and operations of health care provider
participation programs in local jurisdictions in this state.
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 300 to read as follows:
CHAPTER 300. HEALTH CARE PROVIDER PARTICIPATION PROGRAMS IN
CERTAIN POLITICAL SUBDIVISIONS IN THIS STATE
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 300.0001. PURPOSE. The purpose of this chapter is to
authorize a hospital district, county, or municipality in this
state to administer a health care provider participation program to
provide additional compensation to hospitals by collecting
mandatory payments from each hospital in the jurisdiction.
Sec. 300.0002. DEFINITIONS. In this chapter:
(1) "Institutional health care provider" means a nonpublic
hospital in the local jurisdiction that provides
inpatient hospital services.
(2) "Local jurisdiction" means a hospital district, county,
or municipality.
(3) "Paying hospital" means an institutional health care
provider required to make a mandatory payment under this chapter.
(4) "Program" means a health care provider participation
program authorized by this chapter.
Sec. 300.0003. APPLICABILITY. This chapter applies to a
local jurisdiction that is located in this state.
Sec. 300.0004. LOCAL JURISDICTION HEALTH CARE PROVIDER
PARTICIPATION PROGRAM; ORDER REQUIRED FOR PARTICIPATION. The
governing body of a local jurisdiction may only adopt an order
authorizing that local jurisdiction to participate in a health care
provider participation program after an affirmative vote of the
majority of the governing body.
SUBCHAPTER B. POWERS AND DUTIES OF A GOVERNING BODY OF A LOCAL
JURISDICTION
Sec. 300.0051. LIMITATION ON AUTHORITY TO REQUIRE MANDATORY
PAYMENT. The governing body of a local jurisdiction may require a
mandatory payment authorized under this chapter by an institutional
health care provider in that local jurisdiction only in the manner
provided by this chapter.
Sec. 300.0052. RULES AND PROCEDURES. The governing body of
a local jurisdiction may adopt rules relating to the administration
of the health care provider participation program in the local
jurisdiction, including collection of the mandatory payments,
expenditures, audits, and any other administrative aspects of the
program.
Sec. 300.0053. INSTITUTIONAL HEALTH CARE PROVIDER
REPORTING. If the governing body of a local jurisdiction
authorizes the local jurisdiction to participate in a health care
provider participation program under this chapter, the governing
body shall require each institutional health care provider to
submit to the local jurisdiction 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.
SUBCHAPTER C. GENERAL FINANCIAL PROVISIONS
Sec. 300.0101. HEARING. (a) In each year that the
governing body of a local jurisdiction authorizes a health care
provider participation program under this chapter, the governing
body shall hold a public hearing on the amounts of any mandatory
payments that the governing body 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 governing body shall
publish notice of the hearing in a newspaper of general circulation
in the county and provide written notice of the hearing to the chief
operating officer of each institutional health care provider in the
local jurisdiction.
(c) A representative of a paying hospital is entitled to
appear at the time and place designated in the public notice and to
be heard regarding any matter related to the mandatory payments
authorized under this chapter.
Sec. 300.0102. LOCAL PROVIDER PARTICIPATION FUND;
DEPOSITORY. (a) Each governing body of a local jurisdiction that
collects a mandatory payment authorized under this chapter shall
create a local provider participation fund.
(b) If a governing body of a local jurisdiction creates a
local provider participation fund, the governing body shall
designate one or more banks as a depository for the mandatory
payments received by the local jurisdiction.
(c) All funds collected under this chapter shall be secured
in the manner provided for securing other local jurisdiction funds.
Sec. 300.0103. LOCAL PROVIDER PARTICIPATION FUND;
AUTHORIZED USES OF MONEY. (a) The local provider participation
fund established by a local jurisdiction under Section 300.0102
consists of:
(1) all revenue received by the local jurisdiction
attributable to mandatory payments authorized under this chapter;
(2) money received from the Health and Human Services
Commission as a refund of an intergovernmental transfer from the
local jurisdiction to the state for the purpose of providing the
nonfederal share of Medicaid supplemental payment program
payments, provided that the intergovernmental transfer does not
receive a federal matching payment; and
(3) the earnings of the fund.
(b) Money deposited to the local provider participation
fund of a local jurisdiction may be used only to:
1) fund intergovernmental transfers from the local
jurisdiction to the state to provide the nonfederal share of
Medicaid payments for:
(A) uncompensated care payments to nonpublic
hospitals, if those payments are 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);
(B) uniform rate enhancements for nonpublic
hospitals in Medicaid managed care;
(C) payments available under another waiver
program authorizing payments that are substantially similar to
Medicaid payments to nonpublic hospitals described by Subdivision
(A) or (B); or
(D) any reimbursement to nonpublic hospitals for
which federal matching funds are available;
(2) pay costs associated with indigent care provided
by institutional health care providers in the local jurisdiction;
(3) pay the administrative expenses of the local
jurisdiction in administering the program, including
collateralization of deposits;
(4) refund a portion of a mandatory payment collected
in error from a paying hospital;
(5) refund to paying hospitals a proportionate share
of the money that the local jurisdiction:
(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.
(6) transfer funds to the Health and Human Services
Commission if the local jurisdiction is legally required to
transfer the funds to address a disallowance of federal matching
funds with respect to programs for which the local jurisdiction
made intergovernmental transfers described in Subdivision (1); and
(7) reimburse the local jurisdiction if the local
jurisdiction is required by the rules governing the uniform rate
enhancement program described by Subdivision (1)(B) to incur an
expense or forego Medicaid reimbursements from the state because
the balance of the local provider participation fund is not
sufficient to fund that rate enhancement program.
(c) Money in the local provider participation fund of a
local jurisdiction may not be commingled with other local
jurisdiction funds.
(d) Notwithstanding any other provision of this chapter,
with respect to an intergovernmental transfer of funds described by
Subsection (b)(1) made by the local jurisdiction, any funds
received by the state, local jurisdiction, or other entity as a
result of that transfer may not be used by the state, local
jurisdiction, or any 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 or the delivery system reform incentive payment
program.
SUBCHAPTER D. MANDATORY PAYMENTS
Sec. 300.0151. MANDATORY PAYMENTS. (a) Except as provided
by Subsection (e), if the governing body of a local jurisdiction
authorizes a health care provider participation program under this
chapter, the governing body shall require an annual mandatory
payment to be assessed on the net patient revenue of each
institutional health care provider located in the local
jurisdiction. The governing body of the local jurisdiction shall
provide that the mandatory payment is to be collected at least
annually, but not more often than 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 located in the local jurisdiction 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
previous fiscal year or for the closest subsequent fiscal year for
which the provider submitted the Medicare cost report. The local
jurisdiction shall update the amount of the mandatory payment on an
annual basis.
(b) The amount of a mandatory payment authorized under this
chapter for a local jurisdiction must be uniformly proportionate
with the amount of net patient revenue generated by each paying
hospital in the local jurisdiction as permitted under federal law.
A health care provider participation program authorized under this
chapter may not hold harmless any institutional health care
provider, as required under 42 U.S.C. Section 1396b(w).
(c) The governing body of a local jurisdiction that
authorizes a program under this chapter shall set the amount of the
mandatory payment. The aggregate amount of the mandatory payments
required of all paying providers in the local jurisdiction may not
exceed six percent of the aggregate net patient revenue from
hospital services provided by all paying providers in the local
jurisdiction.
(d) Subject to Subsection (c), if the governing body of a
local jurisdiction requires a mandatory payment authorized under
this chapter, the governing body shall set the mandatory payments
in amounts that in the aggregate will generate sufficient revenue
to cover the administrative expenses of the district for activities
under this chapter and to fund an intergovernmental transfer
described by Section 300.103(b)(1). The annual amount of revenue
from mandatory payments that shall be paid for administrative
expenses by the local jurisdiction is not to exceed $150,000, plus
the cost of collateralization of deposits, regardless of actual
expenses.
(e) A paying hospital may not add a mandatory payment
required under this section as a surcharge to a patient.
(f) A mandatory payment under this chapter is not a tax for
purposes of Section 5(a), Article IX, Texas Constitution.
Sec. 300.0152. ASSESSMENT AND COLLECTION OF MANDATORY
PAYMENTS. (a) The local jurisdiction may designate an official of
the local jurisdiction or contract with another person to assess
and collect the mandatory payments authorized under this chapter.
(b) The person charged by the local jurisdiction with the
assessment and collection of mandatory payments shall charge and
deduct from the mandatory payments collected for the local
jurisdiction 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 local jurisdiction, any
revenue from a collection fee charged under Subsection (b) shall be
deposited in the local jurisdiction general fund and, if
appropriate, shall be reported as fees of the local jurisdiction.
Sec. 300.0153. CORRECTION OF INVALID PROVISION OR
PROCEDURE. (a) This chapter does not authorize a local
jurisdiction 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 local jurisdiction associated with
activities under this chapter.
(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 local jurisdiction
may provide by rule or order for an alternative provision or
procedure that conforms to the requirements of the federal Centers
for Medicare and Medicaid Services. A rule or order adopted under
this section may not create, impose, or materially expand the legal
or financial liability or responsibility of the local jurisdiction
or an institutional health care provider in the local jurisdiction
beyond the provisions of this chapter. This section does not
require the governing body of a local jurisdiction to adopt a rule
or order.
(c) The local jurisdiction may only assess and collect a
mandatory payment authorized under this chapter if a waiver
program, uniform rate enhancement, or reimbursement described by
Section 300.103(b)(1) is available to the local jurisdiction.
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, 2019.