Bill Text: TX SB699 | 2025-2026 | 89th Legislature | Introduced

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Bill Title: Relating to the licensing and regulation of inpatient rehabilitation facilities; imposing fees; providing civil and administrative penalties; creating criminal offenses.

Sponsorship: Partisan Bill (Democrat 1)

Status: (Introduced - Dead) 2025-02-03 - Referred to Health & Human Services [SB699 Detail]

Download: Texas-2025-SB699-Introduced.html

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89R639 MPF-D
By: West S.B. No. 699

A BILL TO BE ENTITLED
AN ACT
relating to the licensing and regulation of inpatient
rehabilitation facilities; imposing fees; providing civil and
administrative penalties; creating criminal offenses.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. This Act shall be known as the Eddie Bernice
Johnson Inpatient Rehabilitation Facility Regulatory Act of 2025.
SECTION 2. Section 166.004(a), Health and Safety Code, is
amended to read as follows:
(a) In this section, "health care provider" means:
(1) a hospital;
(2) an institution licensed under Chapter 242,
including a skilled nursing facility;
(3) a home and community support services agency;
(4) an assisted living facility; [and]
(5) a special care facility; and
(6) an inpatient rehabilitation facility licensed
under Chapter 260E.
SECTION 3. Section 241.003(15), Health and Safety Code, is
amended to read as follows:
(15) "Special hospital" means an establishment, other
than an inpatient rehabilitation facility licensed under Chapter
260E, that:
(A) offers services, facilities, and beds for use
for more than 24 hours for two or more unrelated individuals who are
regularly admitted, treated, and discharged and who require
services more intensive than room, board, personal services, and
general nursing care;
(B) has clinical laboratory facilities,
diagnostic X-ray facilities, treatment facilities, or other
definitive medical treatment;
(C) has a medical staff in regular attendance;
and
(D) maintains records of the clinical work
performed for each patient.
SECTION 4. Section 260A.001(5), Health and Safety Code, is
amended to read as follows:
(5) "Facility" means:
(A) an institution as that term is defined by
Section 242.002;
(B) an assisted living facility as that term is
defined by Section 247.002; [and]
(C) a prescribed pediatric extended care center
as that term is defined by Section 248A.001; and
(D) an inpatient rehabilitation facility
licensed under Chapter 260E.
SECTION 5. Subtitle B, Title 4, Health and Safety Code, is
amended by adding Chapter 260E to read as follows:
CHAPTER 260E. INPATIENT REHABILITATION FACILITIES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 260E.0101. DEFINITIONS. In this chapter:
(1) "Assisted living facility" means a facility
licensed under Chapter 247.
(2) "Commission" means the Health and Human Services
Commission.
(3) "Controlling person" means a person described by
Section 260E.0102.
(4) "Executive commissioner" means the executive
commissioner of the commission.
(5) "Hospital" means a hospital licensed under Chapter
241.
(6) "Inpatient rehabilitation facility" means a
freestanding establishment or unit within an acute care hospital or
assisted living facility that primarily provides an intensive
rehabilitation program for patients and has the capacity to provide
three hours of intense rehabilitation services per day to patients
admitted to the facility.
Sec. 260E.0102. CONTROLLING PERSON. (a) A person is a
controlling person of an inpatient rehabilitation facility if the
person has the ability, acting alone or in concert with others, to
directly or indirectly influence, direct, or cause the direction of
the management, expenditure of money, or policies of the facility
or other person affiliated with the facility.
(b) For purposes of this chapter, "controlling person"
includes:
(1) a management company, landlord, or other business
entity that operates, or enters into a contract with another person
for the operation of, an inpatient rehabilitation facility;
(2) any person who is a controlling person of a
management company or other business entity that operates the
facility or enters into a contract with another person for the
operation of the facility; and
(3) any other individual who, because of a personal,
familial, or other relationship with the owner, manager, landlord,
tenant, or health care provider of the facility, is in a position of
actual control or authority with respect to the facility, without
regard to whether the individual is formally named as an owner,
manager, director, officer, provider, consultant, contractor, or
employee of the facility.
(c) Notwithstanding this section, for purposes of this
chapter, a controlling person of an inpatient rehabilitation
facility or of a management company or other business entity
described by Subsection (b)(1) that is a publicly traded
corporation or is controlled by a publicly traded corporation means
an officer or director of the corporation. The term does not
include a shareholder or lender of the corporation.
(d) A controlling person described by Subsection (b)(3)
does not include an individual, including an employee, lender,
secured creditor, or landlord, who does not exercise any influence
or control, whether formal or actual, over the operation of an
inpatient rehabilitation facility.
(e) The executive commissioner may adopt rules to define the
ownership interests and other relationships that qualify a person
as a controlling person of an inpatient rehabilitation facility.
Sec. 260E.0103. ADMISSIBILITY OF CERTAIN EVIDENCE IN CIVIL
ACTIONS. (a) The following information is not admissible as
evidence in a civil action:
(1) a commission determination that an inpatient
rehabilitation facility is in violation of this chapter or a rule
adopted under this chapter; or
(2) the assessment against or payment by the facility
of a penalty assessed under this chapter.
(b) This section does not apply in an enforcement action in
which this state or an agency or political subdivision of this state
is a party.
(c) Notwithstanding this section, evidence described by
Subsection (a) is admissible as evidence in a civil action only if:
(1) the evidence relates to a material violation of
this chapter or a rule adopted under this chapter or assessment of a
monetary penalty with respect to:
(A) the particular incident and the particular
individual whose personal injury is the basis of the civil action
claim; or
(B) a commission determination directly
involving substantially similar conduct that occurred at the
inpatient rehabilitation facility in the year preceding the date of
the particular incident on which the civil action claim is based;
(2) the evidence of a material violation has been
affirmed by a final adjudicated and unappealable commission order
after formal appeal; and
(3) the record is otherwise admissible under the Texas
Rules of Evidence.
SUBCHAPTER B. LICENSING, FEES, AND INSPECTIONS
Sec. 260E.0201. LICENSE REQUIRED. A person, acting
severally or jointly with any other person, may not establish,
conduct, or maintain an inpatient rehabilitation facility in this
state unless the person holds a license issued under this chapter.
Sec. 260E.0202. APPLICATION FOR LICENSE OR LICENSE RENEWAL.
(a) An applicant for a license or license renewal shall submit to
the commission in the form and manner the commission requires a
complete application accompanied by the license fee.
(b) An applicant for a license or license renewal shall
provide with the application evidence that affirmatively
establishes the applicant's ability to comply with:
(1) minimum standards of medical care, rehabilitation
care, nursing care, and financial condition; and
(2) any other applicable state or federal standards.
(c) In reviewing an application under this section, the
commission shall evaluate the background and qualifications of:
(1) the applicant;
(2) a partner, officer, director, or managing employee
of the applicant;
(3) a person who owns or who controls the owner of the
premises in which the inpatient rehabilitation facility operates or
is to operate; and
(4) a controlling person with respect to the inpatient
rehabilitation facility for which the application is submitted.
(d) For purposes of the evaluation required by Subsection
(c), the commission shall require an applicant to file a sworn
affidavit of a satisfactory compliance history and any other
information the commission requires to substantiate a satisfactory
compliance history relating to each inpatient rehabilitation
facility the applicant or a person described by Subsection (c)
operated in this state or outside of this state at any time
preceding the date the application is submitted. The executive
commissioner by rule shall determine the requirements for a
satisfactory compliance history. The commission may:
(1) consider and evaluate the compliance history of
the applicant and each person described by Subsection (c) for any
period during which the applicant or person operated an inpatient
rehabilitation facility in this state or outside this state; and
(2) require the applicant to provide information
relating to the financial history of the applicant and each person
described by Subsection (c) for an inpatient rehabilitation
facility the applicant or person operated outside this state at any
time preceding the date the application is submitted.
(e) Information the commission obtains under this section
regarding an applicant's financial history is confidential and may
not be disclosed to the public.
Sec. 260E.0203. ISSUANCE AND RENEWAL OF LICENSE. (a) After
the commission receives an application for a license or license
renewal and the fee, the commission shall issue to the applicant a
license if, after inspection and investigation, the commission
determines that:
(1) the applicant and each person described by Section
260E.0202(c) satisfy the requirements under this chapter and rules
or standards adopted under this chapter; and
(2) the inpatient rehabilitation facility for which
the application is submitted complies with this chapter and rules
or standards adopted under this chapter.
(b) Except as provided by Subsection (g), a license for an
inpatient rehabilitation facility may be renewed every three years
after:
(1) an inspection is completed;
(2) the applicant submits a completed application that
complies with Section 260E.0202 and pays the required license fee;
and
(3) the applicant submits to the commission and the
commission approves a report that complies with commission rules
specifying:
(A) the date the report must be submitted;
(B) the information the report must contain; and
(C) the form of the report.
(c) Except as provided by Subsection (d), the commission may
issue a license only:
(1) to the person named in an application and for the
premises of an inpatient rehabilitation facility specified in the
application; and
(2) for the maximum number of beds specified in the
application.
(d) The commission may issue one license for multiple
inpatient rehabilitation facilities if:
(1) each building in which patients receive services
from the facilities included in the license are subject to the
control and direction of the same governing body;
(2) each building in which patients receive services
are within a 30-mile radius of the applicant's primary physical
address;
(3) the organized medical staff of each facility
included in the license are integrated;
(4) each facility employs the same chief executive
officer who:
(A) reports directly to the governing body; and
(B) has administrative authority to exercise
control and surveillance over all administrative activities of the
facility;
(5) each facility employs the same chief medical
officer who:
(A) reports directly to the governing body; and
(B) is responsible for all medical staff
activities of the facility;
(6) each facility building included in the license
that is geographically separate from other buildings of the same
facility contains at least one inpatient nursing unit, unless only
diagnostic, laboratory services, or a combination of diagnostic and
laboratory services are provided to facility patients in the
building; and
(7) each facility included in the license complies
with the emergency services standards for a special hospital, as
that term is defined by Section 241.003.
(e) The commission may waive the requirement under
Subsection (d)(7) for an inpatient rehabilitation facility if
another facility included in the license:
(1) complies with the emergency services standards for
a general hospital, as that term is defined by Section 241.003; and
(2) is in close geographic proximity to the facility.
(f) The executive commissioner by rule shall establish
procedures for granting a waiver under Subsection (e). The rules
must require the commission to determine that granting the waiver:
(1) will facilitate the creation or operation of the
inpatient rehabilitation facility seeking the waiver; and
(2) is in the best interest of the individuals served
or to be served by the facility.
(g) An initial license issued for an inpatient
rehabilitation facility under this chapter is a probationary
license and is valid only until the first anniversary of the date of
issuance. On expiration of the probationary license, the
commission shall issue a regular license only if:
(1) the commission determines the license holder and
each person described by Section 260E.0202(c) satisfy the
requirements established under this chapter and rules or standards
adopted under this chapter;
(2) an inspection is completed;
(3) the license holder pays the license fee; and
(4) the license holder submits and the commission
approves the report required under Subsection (b)(3).
(h) The executive commissioner by rule shall adopt a system
under which an appropriate number of licenses the commission issues
under this chapter expire on staggered dates occurring in each
three-year period. If the expiration date of a license changes as a
result of this subsection, the commission shall prorate the license
fee for that license as appropriate.
(i) A license may not be transferred or assigned without the
commission's written approval.
(j) A license holder shall post the license in a conspicuous
place on the premises of the inpatient rehabilitation facility.
Sec. 260E.0204. LIST OF FACILITIES WITH EXCELLENT OPERATING
RECORDS; CHANGE OF OWNERSHIP; EXPEDITED LICENSE ISSUANCE. (a) The
commission shall maintain a current list of license holders for
inpatient rehabilitation facilities in this state that the
commission determines have excellent operating records based on the
information available to the commission. The executive
commissioner by rule shall establish specific criteria for the
commission's use in determining whether to include a license holder
on the list.
(b) The commission shall establish a procedure under which a
license holder included on the list described by Subsection (a) who
submits to the commission an application for a change of ownership
to operate an existing inpatient rehabilitation facility may obtain
a license for that facility on an expedited basis. The procedure
may allow a license holder to submit to the commission an affidavit
demonstrating the license holder satisfies the criteria necessary
for inclusion on the list and the requirements under Subsection
(c).
(c) An applicant for an expedited license under this section
must satisfy each applicable requirement that an applicant for a
license renewal must satisfy under this chapter, including Section
260E.0202(c), and rules adopted under this chapter. A requirement
relating to inspections or to an accreditation review applies only
to inpatient rehabilitation facilities operated by an applicant at
the time the applicant submits the application for a change of
ownership.
Sec. 260E.0205. TEMPORARY LICENSE FOR CHANGE OF OWNERSHIP.
(a) For purposes of this section, a temporary license is a 90-day
license for a temporary change of ownership issued to an applicant
who proposes to become the new operator of an inpatient
rehabilitation facility existing on the date the application is
submitted.
(b) After receiving an application for a temporary change of
ownership, the commission shall issue a temporary license to the
applicant if, after investigation, the commission determines the
applicant and each person described by Section 260E.0202(c)
satisfy:
(1) the requirements under Section 260E.0202(b); and
(2) the commission's requirements for the background
and qualifications of the persons described by Sections
260E.0202(c) and (d).
(c) Except as provided by Subsection (d), the commission may
not issue a temporary license to an applicant before the 31st day
after the date the commission receives both:
(1) the application for a temporary change of
ownership; and
(2) written notice from the current license holder of
the inpatient rehabilitation facility for which the application is
submitted of that license holder's intent to transfer operation of
the facility to the applicant beginning on a date the applicant
specifies.
(d) The executive commissioner by rule shall establish
criteria under which the commission may waive the 30-day
requirement or the notification requirement under Subsection (c).
The criteria may include a forcible entry and detainer, death,
divorce, or any other event that affects a current license holder's
ownership of an inpatient rehabilitation facility.
(e) After the commission receives an application for a
temporary change of ownership or written notice under Subsection
(c), the commission may place a hold on payments to the current
license holder for an inpatient rehabilitation facility in an
amount not to exceed the average of the monthly vendor payments paid
to the facility, as the commission determines. The commission:
(1) shall disburse the payments not later than the
120th day after the date the final reporting requirements are
satisfied and any resulting informal reviews or formal appeals are
resolved; and
(2) may reduce the amount disbursed by the amount the
former license holder owes to the commission under a Medicaid
contract or license.
(f) The executive commissioner by rule shall define the
factors constituting a change of ownership for an inpatient
rehabilitation facility. In adopting the rules, the executive
commissioner shall consider:
(1) the proportion of ownership interest being
transferred to another person;
(2) the addition or removal of a stockholder, partner,
owner, or other controlling person;
(3) the reorganization of a license holder into a
different type of business entity; and
(4) the death or incapacity of a stockholder, partner,
or owner.
(g) The executive commissioner may adopt rules requiring a
license holder to notify the commission of any change, including a
change that does not constitute a change of ownership, as that term
is defined by commission rules. This section does not prohibit the
commission from acting under Section 260E.0301 or any other
provision of this chapter.
(h) The commission shall issue or deny a temporary license
not later than the 31st day after the date the commission receives a
completed application for a temporary change of ownership. The
effective date of a temporary license issued under this section is
the date requested in the application unless:
(1) the commission does not receive the application
and written notice described by Subsection (c) at least 30 days
before that date; and
(2) the commission did not waive those requirements in
accordance with Subsection (d).
(i) If the commission does not receive an application for a
temporary change of ownership and written notice under Subsection
(c) at least 30 days before the effective date requested in the
application and the commission did not waive those requirements in
accordance with Subsection (d), the effective date of the temporary
license is the 31st day after the date the commission receives both
the application and the notice.
(j) Except as provided by Subsection (k), after the
commission issues a temporary license to an applicant, the
commission shall, as soon as reasonably possible, conduct an
inspection or survey of the inpatient rehabilitation facility for
which the license is issued in accordance with Section 260E.0213.
During the period between the date a temporary license is issued and
the date the facility is inspected or surveyed under Section
260E.0213 or desk reviewed under Subsection (k), the commission may
not place a hold on vendor payments to the temporary license holder.
(k) The executive commissioner by rule shall establish
criteria under which the commission may substitute a desk review of
an inpatient rehabilitation facility's compliance with applicable
requirements for the on-site inspection or survey under Subsection
(j).
(l) After the commission conducts an inspection or survey
under Subsection (j) or a desk review under Subsection (k) of an
inpatient rehabilitation facility, the commission shall issue a
license under Section 260E.0203 to the temporary license holder if
the facility passes the inspection, survey, or desk review and the
applicant meets the requirements under that section. If the
facility fails to pass the inspection, survey, or desk review or the
temporary license holder fails to meet the requirements under that
section, the commission may:
(1) place a hold on vendor payments to the temporary
license holder; and
(2) take any other action authorized by this chapter.
(m) If a license holder meets the requirements under Section
260E.0203 and the inpatient rehabilitation facility passes an
initial or subsequent inspection, a survey, or a desk review before
the temporary license expires, the license issued under Section
260E.0203 is considered effective on the date the commission
determines under Subsection (h) or (i).
(n) A temporary license issued under this section expires on
the 90th day after the effective date of the license established
under Subsection (h) or (i).
Sec. 260E.0206. LICENSE FEES. (a) The commission shall
charge each inpatient rehabilitation facility a license fee for an
initial license or a license renewal.
(b) The executive commissioner by rule shall adopt the
license fees in amounts as prescribed by Section 12.0111 and in
accordance with a schedule under which the fee amount is determined
by the number of beds in an inpatient rehabilitation facility. A
minimum license fee may be established.
(c) The amount of a license fee adopted under this chapter
must be based on the estimated cost to and effort expended by the
commission to issue or renew the license.
(d) All license fees collected shall be deposited in the
state treasury to the credit of the commission to administer and
enforce this chapter.
(e) Notwithstanding Subsection (d), to the extent money
received from the license fees collected under this chapter exceeds
the commission's costs, the commission may use the money to
administer Chapter 324 and similar laws that require the commission
to provide information related to inpatient rehabilitation care to
the public. The executive commissioner may not consider the costs
of administering Chapter 324 or similar laws in establishing the
amount of a license fee.
Sec. 260E.0207. GRADING OF FACILITIES. (a) The executive
commissioner may adopt by rule and publish and the commission may
enforce minimum standards relating to the grading of an inpatient
rehabilitation facility to identify the facilities that provide
above the minimum level of services and personnel as the executive
commissioner establishes.
(b) An inpatient rehabilitation facility recognized with a
superior grade, as the executive commissioner determines by rule,
shall prominently display the grade in an area of the facility that
is accessible to the public.
(c) As an incentive to obtain the superior grade, an
inpatient rehabilitation facility may advertise the facility's
grade, except the facility may not advertise a superior grade that
has been revoked.
(d) The commission may not award a superior grade to an
inpatient rehabilitation facility that, during the year preceding
the grading inspection, violated a state or federal law or rule
relating to:
(1) the health, safety, or welfare of the facility's
patients;
(2) patient funds;
(3) the confidentiality of a patient's records;
(4) the financial practices of the facility; or
(5) the control of medication in the facility.
(e) The commission shall revoke an inpatient rehabilitation
facility's superior grade if the facility:
(1) does not meet the criteria established for a
superior grade; or
(2) violates a state or federal law or rule described
by Subsection (d).
Sec. 260E.0208. RULES; MINIMUM STANDARDS. (a) The
executive commissioner by rule shall establish and the commission
shall enforce rules and minimum standards to implement this
chapter, including rules and minimum standards relating to quality
of life, quality of care, and patients' rights.
(b) In adopting rules, the executive commissioner shall:
(1) consider the conditions of participation for
certification under Title XVIII of the Social Security Act (42
U.S.C. Section 1395 et seq.) and the Joint Commission's standards;
and
(2) attempt to achieve consistency with those
conditions and standards.
(c) The rules and standards the executive commissioner
adopts under this chapter:
(1) may be more stringent than the standards imposed
by federal law for certification for participation in the state
Medicaid program; and
(2) may not be less stringent than the Medicaid
certification standards and regulations imposed under the Omnibus
Budget Reconciliation Act of 1987 (OBRA), Pub. L. No. 100-203, for
an inpatient rehabilitation facility that is a unit of a nursing
facility or an assisted living facility.
(d) To implement Sections 260E.0202(c) and (d), the
executive commissioner by rule shall adopt minimum standards for
the background and qualifications of each person described by
Section 260E.0202(c). The commission may not issue or renew a
license if a person described by Section 260E.0202(c) does not meet
the minimum standards adopted under this section.
(e) In addition to other standards or rules required by this
chapter, the executive commissioner shall adopt and publish and the
commission shall enforce minimum standards relating to:
(1) the construction of an inpatient rehabilitation
facility, including plumbing, heating, lighting, ventilation, and
other housing conditions, to ensure the patients' health, safety,
comfort, and protection from fire hazard;
(2) the regulation of the number and qualification of
all personnel, including management and nursing personnel,
responsible for any part of the care provided to patients;
(3) requirements for in-service education of all
employees who have any contact with patients;
(4) training on the care of individuals with
Alzheimer's disease and related disorders for employees who work
with those individuals;
(5) sanitary and related conditions in a facility and
the facility's surroundings, including water supply, sewage
disposal, food handling, and general hygiene, to ensure the
patients' health, safety, and comfort;
(6) the nutritional needs of each patient according to
good nutritional practice or the recommendations of the health care
provider attending the patient;
(7) equipment essential to the patients' health and
welfare;
(8) the use and administration of medication in
conformity with applicable law and rules;
(9) care and treatment of patients and any other
matter related to patient health, safety, and welfare;
(10) licensure of facilities;
(11) compliance with other state and federal laws
affecting the health, safety, and rights of patients;
(12) compliance with nursing peer review under
Subchapter I, Chapter 301, Occupations Code, and Chapter 303,
Occupations Code, and the rules of the Texas Board of Nursing
relating to peer review; and
(11) implementation of this chapter.
(f) The executive commissioner shall adopt and publish and
the commission shall enforce minimum standards requiring
appropriate training in geriatric care for each individual who
provides services to geriatric patients in an inpatient
rehabilitation facility and who holds a license or certificate
issued by a state agency that authorizes the individual to provide
the services. The minimum standards may require each licensed or
certified individual to complete an appropriate program of
continuing education or in-service training, as determined by
commission rule, on a schedule determined by commission rule.
(g) To administer the surveys for provider certification
provided for by federal law and rules, the commission shall
identify each area of care subject to both federal certification
and state licensing requirements. For each area of care subject to
the same standard under both federal certification and state
licensing requirements, an inpatient rehabilitation facility in
compliance with the federal certification standard is considered to
be in compliance with the same state licensing requirement.
(h) The minimum standards the executive commissioner adopts
under this section must require each inpatient rehabilitation
facility, as part of an existing training program, to provide each
registered nurse, licensed vocational nurse, nurse aide, and
nursing assistant who provides nursing services in the facility at
least one hour of training each year in caring for persons with
dementia.
(i) The commission by order may waive or modify a
requirement under this chapter or a minimum standard the commission
adopts by rule under this section for a particular inpatient
rehabilitation facility if the commission determines the waiver or
modification will facilitate the creation or operation of the
facility and the waiver or modification is in the best interests of
the individuals served or to be served by the facility.
(j) The executive commissioner by rule shall establish
procedures and criteria for issuing a waiver or modification order
under Subsection (i). The criteria must include at a minimum an
assessment of the appropriateness of the waiver or modification
compared to the best interests of the individuals served or to be
served by the facility.
(k) If the commission orders a waiver or modification under
Subsection (i), the commission shall document the waiver or
modification order in the licensing record of the inpatient
rehabilitation facility granted the waiver or modification. The
executive commissioner by rule shall specify the type and
specificity of the documentation that must be included in the
licensing record.
(l) An inpatient rehabilitation facility must contain an
emergency treatment room but is not required to have an emergency
department.
Sec. 260E.0209. PATIENT TRANSFERS. (a) The executive
commissioner shall adopt rules on:
(1) the transfer of patients between inpatient
rehabilitation facilities that have not executed a transfer
agreement; and
(2) services not included in a transfer agreement.
(b) The rules the executive commissioner adopts under
Subsection (a) must:
(1) ensure a patient transfer between inpatient
rehabilitation facilities is accomplished in accordance with
facility policies resulting in medically appropriate transfers
from health care provider to health care provider and from facility
to facility by providing that:
(A) the facility receiving the patient is
notified before the patient transfer and confirms the patient meets
the facility's admissions criteria relating to appropriate bed,
provider, and other services necessary to treat the patient;
(B) the patient is stabilized before and during
the patient transfer using medically appropriate life support
measures that a reasonable and prudent health care provider
exercising ordinary care in the same or a similar locality would
use;
(C) appropriate personnel and equipment are used
for the patient transfer in accordance with the care a reasonable
and prudent health care provider exercising ordinary care in the
same or a similar locality would use for the transfer;
(D) all necessary records for the patient's
continuing care are transferred to the facility receiving the
patient; and
(E) the patient transfer is not predicated on
arbitrary, capricious, or unreasonable discrimination because of
race, religion, national origin, age, sex, physical condition, or
economic status;
(2) ensure an inpatient rehabilitation facility may
not transfer a patient who is experiencing an emergency medical
condition that has not been stabilized unless:
(A) the patient or a legally responsible person
acting on the patient's behalf, after being informed of the
facility's obligations under this section and of the risk of
transfer, in writing requests transfer to another facility;
(B) a licensed physician signs a certification,
which includes a summary of the risks and benefits based on the
information available at the time of transfer, that the medical
benefits reasonably expected from the provision of appropriate
medical treatment at another facility outweigh the increased risks
to the patient and, in the case of a pregnant patient in labor, to
the unborn child from effecting the transfer; or
(C) if a licensed physician is not physically
present in the emergency treatment room or department at the time a
patient is transferred, a qualified medical professional signs a
certification described by Paragraph (B) after a licensed
physician, in consultation with the professional, makes the
determination described by that paragraph and subsequently
countersigns the certificate;
(3) require a public inpatient rehabilitation
facility to accept a patient transfer of an eligible patient if the
facility has appropriate facilities, services, and staff available
for providing care to the patient;
(4) require an inpatient rehabilitation facility to
take all reasonable steps to secure the informed refusal of a
patient, or of a person acting on the patient's behalf, to a
transfer or to related examination and treatment; and
(5) recognize any contractual, statutory, or
regulatory obligations that may exist between a patient and a
designated or mandated health care provider as those obligations
apply to the transfer of emergency or nonemergency patients.
Sec. 260E.0210. FIRE SAFETY REQUIREMENTS. (a) The
executive commissioner shall adopt rules necessary to specify the
edition of the Life Safety Code of the National Fire Protection
Association to be used in establishing the life safety requirements
for an inpatient rehabilitation facility licensed under this
chapter.
(b) The executive commissioner shall adopt the edition of
the Life Safety Code of the National Fire Protection Association
for fire safety as designated by federal law and rules for an
inpatient rehabilitation facility or portion of a facility
constructed after September 1, 1993, and for a facility or portion
of a facility operating or approved for construction on or before
September 1, 1993.
(c) The executive commissioner may not require more
stringent fire safety standards than those required by federal law
and rules. The rules adopted under this section may not prevent an
inpatient rehabilitation facility licensed under this chapter from
voluntarily conforming to fire safety standards that are compatible
with, equal to, or more stringent than those the executive
commissioner adopts.
(d) An inpatient rehabilitation facility that exists on
September 1, 2025, may continue the facility's use or occupancy
that existed on that date if the facility complies with fire safety
standards and ordinances in effect on that date.
(e) Notwithstanding this section, a municipality may enact
additional and more stringent fire safety standards applicable to
new construction on or after September 1, 2025.
(f) The executive commissioner shall adopt rules to
implement an expedited inspection process to allow an applicant for
an initial license or a license renewal to obtain a life safety code
and physical plant inspection not later than the 15th day after the
date the applicant submits the request. The commission may charge a
fee to recover the cost of the expedited inspection. The rules must
allow the commission to charge different fee amounts based on the
size of the inpatient rehabilitation facility.
Sec. 260E.0211. REGISTRATION WITH TEXAS INFORMATION AND
REFERRAL NETWORK. (a) An inpatient rehabilitation facility
licensed under this chapter shall register with the Texas
Information and Referral Network under Section 526.0004,
Government Code, to assist this state in identifying individuals
needing assistance if an area is evacuated because of a disaster or
other emergency.
(b) An inpatient rehabilitation facility is not required to
identify individual patients who may require assistance in an
evacuation or to register individual patients with the Texas
Information and Referral Network for evacuation assistance.
(c) An inpatient rehabilitation facility shall notify each
patient and the patient's next of kin or guardian regarding the
steps necessary to register for evacuation assistance with the
Texas Information and Referral Network.
Sec. 260E.0212. REQUIRED POSTING OF CERTAIN DOCUMENTS. (a)
Each inpatient rehabilitation facility shall prominently and
conspicuously post for display in a public area of the facility that
is readily available to patients, employees, and visitors:
(1) the license issued under this chapter;
(2) a sign the commission prescribes specifying
complaint procedures established under this chapter or rules
adopted under this chapter and the steps necessary to register a
complaint with the commission;
(3) a notice in a form the commission prescribes
stating that licensing inspection reports and other related reports
detailing deficiencies the commission cites are available at the
facility for public inspection and providing the commission's
toll-free telephone number to be used to obtain information
concerning the facility;
(4) a concise summary of the most recent inspection
report relating to the facility;
(5) notice of the availability of commission summary
reports relating to the quality of care, recent investigations,
litigation, and other aspects of the facility's operation;
(6) notice that the commission, if applicable, can
provide information about the facility administrator;
(7) any notice or written statement required to be
posted under Section 260E.0314(c);
(8) notice that informational materials relating to
the facility's compliance history are available for inspection at a
location in the facility specified by the sign;
(9) notice that employees, other staff, patients,
volunteers, and family members and guardians of patients are
protected from discrimination or retaliation as provided by
Sections 260A.014 and 260A.015; and
(10) a sign requiring reporting of suspected abuse,
neglect, and exploitation as described by Section 260A.006(a).
(b) The notice required by Subsection (a)(8) must also be
posted at each door providing ingress to and egress from an
inpatient rehabilitation facility. The facility shall ensure the
informational materials described by that subsection:
(1) are maintained in a well-lighted accessible
location; and
(2) include a statement in the form the commission
requires of the facility's record of compliance with this chapter
and the rules and standards adopted under this chapter that is
updated not less than twice a month and that reflects the record of
compliance during the year preceding the date the statement is last
updated.
(c) The notice required by Subsection (a)(9) must be posted
in English and a second language as required by commission rule.
(d) The commission shall post detailed compliance
information regarding each inpatient rehabilitation facility the
commission licenses, including the information a facility is
required to post under Subsection (b), on the commission's Internet
website. The commission shall update the information every month
to provide the most recent compliance information on each facility.
Sec. 260E.0213. INSPECTIONS. (a) The commission or the
commission's representative may conduct any inspection, including
an unannounced inspection or follow-up inspection, survey, or
investigation that the commission considers necessary and may enter
the premises of an inpatient rehabilitation facility at reasonable
times to conduct an inspection, survey, or investigation in
accordance with commission rules.
(b) The commission is entitled to access books, records, and
other documents maintained by or on behalf of an inpatient
rehabilitation facility to the extent necessary to enforce this
chapter and the rules adopted under this chapter.
(c) A license holder or an applicant for a license is
considered to have consented to entry and inspection of the
inpatient rehabilitation facility by a representative of the
commission in accordance with this chapter.
(d) The commission shall establish procedures to preserve
all relevant evidence of conditions found during an inspection,
survey, or investigation that the commission reasonably believes
threaten the health and safety of a patient, including photography
and photocopying of relevant documents, including a license
holder's notes, a physician's orders, and pharmacy records, for use
in any legal proceeding.
(e) When photographing a patient, the commission:
(1) shall respect the privacy of the patient to the
greatest extent possible; and
(2) may not disclose the patient's identity to the
public.
(f) An inpatient rehabilitation facility, an officer or
employee of the facility, and a patient's attending physician are
not civilly liable for surrendering confidential or private
material under this section, including physician's orders,
pharmacy records, notes and memoranda of a state office, and
patient files.
(g) The commission shall establish in clear and concise
language a form to summarize each inspection report and complaint
investigation report.
(h) The executive commissioner shall establish proper
procedures to ensure that copies of all forms and reports under this
section are made available to consumers, service recipients, and
the relatives of service recipients as the executive commissioner
considers proper.
Sec. 260E.0214. UNANNOUNCED INSPECTIONS. (a) The
commission shall annually conduct at least one unannounced
inspection of each inpatient rehabilitation facility.
(b) If an inpatient rehabilitation facility is a unit within
an assisted living facility, for at least one unannounced annual
inspection of the facility, the commission shall invite at least
one individual as a citizen advocate from:
(1) the AARP;
(2) the Texas Senior Citizen Association;
(3) the commission's Certified Long-term Care
Ombudsman; or
(4) another statewide organization for the elderly.
(c) The commission shall randomly select a number of
inpatient rehabilitation facilities for unannounced inspections to
be conducted between 5 p.m. and 8 a.m. in a percentage amount the
commission determines sufficient to ensure continuous compliance.
The inspections must be cursory to avoid to the greatest extent
feasible any disruption of the patients.
(d) The commission may require additional inspections.
Sec. 260E.0215. FOLLOW-UP INSPECTIONS. (a) The commission
or the commission's representative may conduct a follow-up
inspection of an inpatient rehabilitation facility after
conducting an inspection, survey, or investigation of the facility
under Section 260E.0213 or 260E.0214 to:
(1) evaluate and monitor the determinations of the
initial inspection, survey, or investigation; and
(2) ensure the commission is citing and punishing
deficiencies consistently across the state.
(b) If an inpatient rehabilitation facility corrects a
deficiency cited during a follow-up inspection within the time
specified by commission rule, the commission may not impose
additional punitive actions for the deficiency.
Sec. 260E.0216. REPORTING OF VIOLATIONS. (a) The
commission or the commission's representative conducting an
inspection, survey, or investigation under Section 260E.0213 or
260E.0214 shall:
(1) list each violation of a law or rule on a form the
commission designs for inspections; and
(2) identify the specific law or rule an inpatient
rehabilitation facility violates.
(b) If the commission or the commission's representative
conducting an inspection, survey, or investigation under Section
260E.0213 or 260E.0214 identifies a violation that constitutes
immediate jeopardy to the health or safety of a patient:
(1) the commission shall immediately notify the
inpatient rehabilitation facility's management of the violation;
and
(2) a commission representative shall remain in or be
accessible to the facility until the commission receives the
facility's plan of removal related to the violation.
(c) At the conclusion of an inspection, survey, or
investigation under Section 260E.0213 or 260E.0214, the commission
or the commission's representative conducting the inspection,
survey, or investigation shall discuss the violations with the
inpatient rehabilitation facility's management in an exit
conference. The commission or the commission's representative
shall leave a written list of the violations with the facility at
the time of the exit conference. If the commission or the
commission's representative discovers any additional violations
during the review of field notes or preparation of the official
final list, the commission or the commission's representative shall
give the facility an additional exit conference regarding the
additional violations. An additional exit conference must be held
in person and may not be held by telephone, e-mail, or facsimile
transmission.
(d) An inpatient rehabilitation facility that receives
notice of a violation under this section shall submit a plan to
correct the violations to the regional director of the public
health region in which the facility is located not later than the
10th working day after the date the facility receives the final
official statement of violations.
Sec. 260E.0217. DISCLOSURE OF UNANNOUNCED INSPECTIONS;
CRIMINAL PENALTY. (a) Except as expressly provided by this
chapter, a person commits an offense if the person intentionally
discloses to an unauthorized person the date, time, or any other
information about an unannounced inspection of an inpatient
rehabilitation facility before the inspection occurs.
(b) In this section, "unauthorized person" does not
include:
(1) the commission;
(2) the office of the attorney general;
(3) an ombudsman or representative of the commission;
(4) a representative of an agency or organization when
a Medicare or Medicaid survey is made concurrently with a licensing
inspection; or
(5) any other person or entity authorized by law to
make an inspection or to accompany an inspector.
(c) An offense under this section is a third degree felony.
(d) A person convicted under this section is not eligible
for state employment.
Sec. 260E.0218. OPEN HEARING. (a) The commission shall
hold an open hearing in a licensed inpatient rehabilitation
facility if the commission has taken a punitive action against the
facility in the preceding 12 months or if the commission receives a
complaint from an ombudsman, advocate, patient, or relative of a
patient relating to a serious or potentially serious problem in the
facility and the commission has reasonable cause to believe the
complaint is valid. The commission is not required to hold more
than one open meeting for a particular inpatient rehabilitation
facility in each year.
(b) The commission shall give notice of the time, place, and
date of a hearing under this section to:
(1) the inpatient rehabilitation facility at which the
meeting will be held;
(2) a patient or the designated closest living
relative or legal guardian of a patient, as applicable, who
received rehabilitation services from the facility during the 12
months preceding the date of the meeting; and
(3) appropriate state or federal agencies that work
with the facility.
(c) The commission may exclude an inpatient rehabilitation
facility's administrators and personnel from a hearing held under
this section.
(d) The commission shall notify the inpatient
rehabilitation facility at which a meeting under this section is
held of any complaints received at the hearing and, without
identifying the source of the complaints, provide a summary of the
complaints to the facility.
(e) The commission shall determine and implement a
mechanism to confidentially notify a complainant of the results of
the complaint investigation.
SUBCHAPTER C. GENERAL ENFORCEMENT
Sec. 260E.0301. DENIAL, SUSPENSION, OR REVOCATION OF
LICENSE. (a) In this section:
(1) "Abuse" has the meaning assigned by Section
260A.001.
(2) "Immediate threat to health and safety" means a
situation in which immediate corrective action is necessary because
an inpatient rehabilitation facility's noncompliance with one or
more requirements has caused, or is likely to cause, serious
injury, harm, impairment, or death to a patient.
(3) "Neglect" has the meaning assigned by Section
260A.001.
(b) The commission, after providing notice and opportunity
for a hearing to a license holder or license applicant, may deny,
suspend, or revoke a license if the commission determines the
license holder, applicant, or a person described by Section
260E.0202(c) has:
(1) violated this chapter or a rule, standard, or
order adopted or license issued under this chapter in either a
repeated or substantial manner; or
(2) committed an act described by Section
260E.0306(a)(2), (3), (4), (5), or (6).
(c) Except as provided by Subsection (d), the executive
commissioner shall revoke a license under Subsection (b) if the
commission determines that:
(1) the license holder has committed in a 24-month
period three violations described by Subsection (b) that constitute
an immediate threat to health and safety related to the abuse or
neglect of a patient; and
(2) each of the violations described by Subdivision
(1) is reported in connection with a separate survey, inspection,
or investigation visit that occurred on separate entrance and exit
dates.
(d) The executive commissioner may not revoke a license
under Subsection (c) based on a violation described by Subsection
(c)(1) if:
(1) the violation and the determination of immediate
threat to health and safety are not included on the written list of
violations left with the facility at the time of the initial exit
conference under Section 260E.0216(c) for a survey, inspection, or
investigation;
(2) the violation is not included on the final
statement of violations described by Section 260E.0216; or
(3) the violation has been reviewed under the informal
dispute resolution process established by Section 526.0202,
Government Code, and a determination was made that:
(A) the violation should be removed from the
license holder's record; or
(B) the violation is reduced in severity so that
the violation is no longer cited as an immediate threat to health
and safety related to the abuse or neglect of a patient.
(e) The status of a person as an applicant for a license or a
license holder is preserved until final disposition of the
contested matter, except as the court having jurisdiction of a
judicial review of the matter may order in the public interest for
the welfare and safety of the patients.
(f) In a license revocation case under Subsection (c), to
ensure the health and safety of inpatient rehabilitation facility
patients, the commission may:
(1) assist with obtaining a new operator for the
facility; or
(2) assist with the relocation of patients to another
facility.
(g) A court having jurisdiction of a judicial review of the
matter may not order arbitration, whether on motion of any party or
on the court's own motion, to resolve a dispute involving the
denial, suspension, or revocation of a license under this section
or the conduct with respect to which the denial, suspension, or
revocation of the license is sought.
(h) The executive commissioner may stay a license
revocation required by Subsection (c) if the executive commissioner
determines the stay would not jeopardize the health and safety of
the inpatient rehabilitation facility patients or place the
patients at risk of abuse or neglect. The executive commissioner by
rule shall establish criteria under which a license revocation may
be stayed under this subsection. The executive commissioner shall
follow negotiated rulemaking procedures prescribed by Chapter
2008, Government Code, for the adoption of rules establishing the
criteria. The criteria established must authorize the executive
commissioner to stay a license revocation of a facility for which
the commission has deployed a rapid response team under Section
255.004, if the facility has cooperated with the rapid response
team and demonstrated improvement in quality of care, as determined
by the rapid response team.
Sec. 260E.0302. EMERGENCY SUSPENSION OR CLOSING ORDER. (a)
The commission shall suspend an inpatient rehabilitation
facility's license or order an immediate closing of part of the
facility if:
(1) the commission determines the facility is
operating in violation of the standards prescribed by this chapter;
and
(2) the violation creates an immediate threat to the
health and safety of a patient.
(b) The executive commissioner by rule shall provide for the
placement of patients during an inpatient rehabilitation
facility's suspension or closing to ensure their health and safety.
(c) An order suspending a license or closing a part of an
inpatient rehabilitation facility under this section is
immediately effective on the date on which the license holder
receives written notice or a later date specified in the order.
(d) An order suspending a license or ordering the immediate
closure of a part of an inpatient rehabilitation facility is valid
until the 10th day following the effective date of the order.
(e) A court having jurisdiction of a judicial review of the
matter may not order arbitration, whether on motion of any party or
on the court's own motion, to resolve a dispute involving an
emergency suspension or closing order under this section or the
conduct with respect to which the emergency suspension or closing
order is sought.
Sec. 260E.0303. INJUNCTION. (a) The commission may
petition a district court for:
(1) a temporary restraining order to restrain a person
from a violation or threatened violation of the standards
prescribed by this chapter or any other law affecting inpatient
rehabilitation facility patients if the commission reasonably
believes the violation or threatened violation creates an immediate
threat to the health and safety of a patient; and
(2) an injunction to restrain a person from a
violation or threatened violation of the standards prescribed by
this chapter or any other law affecting facility patients if the
commission reasonably believes the violation or threatened
violation creates a threat to the health and safety of a patient.
(b) A district court, on petition of the commission, may by
injunction:
(1) prohibit a person from violating the standards or
licensing requirements prescribed by this chapter;
(2) restrain or prevent the establishment, conduct,
management, or operation of an inpatient rehabilitation facility
without a license issued under this chapter; or
(3) grant the injunctive relief warranted by the facts
on a finding by the court that a person is violating or threatening
to violate the standards or licensing requirements prescribed by
this chapter.
(c) The attorney general, on the commission's request,
shall bring and conduct in the name of this state an action
authorized by this section.
(d) An action for a temporary restraining order or other
injunctive relief must be brought in the county in which the alleged
violation occurs or is threatened to occur.
Sec. 260E.0304. LICENSE REQUIREMENT; CRIMINAL PENALTY. (a)
A person commits an offense if the person violates Section
260E.0201.
(b) An offense under this section is punishable by a fine of
not more than $1,000 for the first offense and not more than $500
for each subsequent offense.
(c) Each day of a continuing violation after conviction
constitutes a separate offense.
Sec. 260E.0305. CIVIL PENALTY. (a) In this section,
"affiliate" means:
(1) with respect to a partnership other than a limited
partnership, each partner of the partnership;
(2) with respect to a corporation:
(A) an officer;
(B) a director;
(C) a stockholder who owns, holds, or has the
power to vote at least 10 percent of any class of securities issued
by the corporation, regardless of whether the power is of record or
beneficial; and
(D) a controlling individual;
(3) with respect to an individual:
(A) each partnership and each partner in the
partnership in which the individual or any other affiliate of the
individual is a partner; and
(B) each corporation or other business entity in
which the individual or another affiliate of the individual is:
(i) an officer;
(ii) a director;
(iii) a stockholder who owns, holds, or has
the power to vote at least 10 percent of any class of securities
issued by the corporation, regardless of whether the power is of
record or beneficial; and
(iv) a controlling individual;
(4) with respect to a limited partnership:
(A) a general partner; and
(B) a limited partner who is a controlling
individual;
(5) with respect to a limited liability company:
(A) an owner who is a manager as described by the
Texas Limited Liability Company Law, as described by Section
1.008(e), Business Organizations Code; and
(B) each owner who is a controlling individual;
and
(6) with respect to any other business entity, a
controlling individual.
(b) A person who violates or causes a violation of this
chapter or a rule adopted under this chapter is liable for a civil
penalty of not less than $1,000 or more than $20,000 for each act of
violation if the commission determines the violation threatens the
health and safety of a patient.
(c) In determining the amount of a penalty to be awarded
under this section, the trier of fact shall consider:
(1) the seriousness of the violation;
(2) the history of violations committed by the person
or the person's affiliate, employee, or controlling person;
(3) the amount necessary to deter future violations;
(4) the efforts made to correct the violation;
(5) any misrepresentation made to the commission or to
another person regarding:
(A) the quality of services rendered or to be
rendered to patients;
(B) the compliance history of the inpatient
rehabilitation facility or any facilities owned or controlled by an
owner or controlling person of the facility; or
(C) the identity of an owner or controlling
person of the facility;
(6) the culpability of the person who committed the
violation; and
(7) any other matter that should, as a matter of
justice or equity, be considered.
(d) Each day of a continuing violation constitutes a
separate ground for recovery under this section.
(e) Any party to an action brought under this section may
request a jury.
(f) If a person who is liable under this section fails to pay
any amount the person is obligated to pay under this section, this
state may seek satisfaction from any owner, other controlling
person, or affiliate of the person found liable. The owner, other
controlling person, or affiliate may be found liable in the same
action or in another action on a showing by this state that the
amount to be paid has not been paid or otherwise legally discharged.
The executive commissioner by rule may establish a method for
satisfying an obligation imposed under this section from an
insurance policy, letter of credit, or other contingency fund.
(g) On the commission's request, the attorney general may
bring an action in a district court to collect a civil penalty under
this section. The attorney general may recover reasonable expenses
incurred in bringing an action under this section, including court
costs, reasonable attorney's fees, investigative costs, witness
fees, and deposition costs.
(h) A payment submitted to satisfy an obligation under this
section is not an allowable cost for reimbursement under Medicaid.
(i) A civil penalty awarded under this section constitutes a
fine, penalty, or forfeiture payable to and for the benefit of a
government unit and is not compensation for actual pecuniary loss.
Sec. 260E.0306. ADMINISTRATIVE PENALTY. (a) The
commission may assess an administrative penalty against a person
who:
(1) violates this chapter or a rule, standard, or
order adopted or license issued under this chapter;
(2) makes a false statement, that the person knows or
should know is false, of a material fact:
(A) on an application for an initial license or
license renewal or in an attachment to the application; or
(B) with respect to a matter under investigation
by the commission;
(3) refuses to allow a representative of the
commission to inspect:
(A) a book, record, or file required to be
maintained by an inpatient rehabilitation facility; or
(B) any portion of the premises of a facility;
(4) wilfully interferes with the work of a
representative of the commission or the enforcement of this
chapter;
(5) wilfully interferes with a representative of the
commission preserving evidence of a violation of this chapter or a
rule, standard, or order adopted or license issued under this
chapter;
(6) fails to pay a penalty assessed by the commission
under this chapter not later than the 10th day after the date the
assessment of the penalty becomes final; or
(7) fails to notify the commission of a change of
ownership before the effective date of the change of ownership.
(b) Except as provided by Subsection (f) and Section
260E.0308(d), the penalty may not exceed $10,000 a day for each
violation.
(c) Each day of a continuing violation constitutes a
separate violation.
(d) The executive commissioner shall establish gradations
of penalties in accordance with the relative seriousness of the
violation.
(e) In determining the amount of a penalty, the commission
shall consider any matter that justice may require, including:
(1) the gradations of penalties established under
Subsection (d);
(2) the seriousness of the violation, including the
nature, circumstances, extent, and gravity of the prohibited act
and the hazard or potential hazard created by the act to the health
or safety of the public;
(3) the history of previous violations;
(4) deterrence of future violations; and
(5) efforts to correct the violation.
(f) The penalty for a violation of Section 260E.0314(c) may
not exceed $1,000 a day for each violation.
(g) The persons against whom an administrative penalty may
be assessed under Subsection (a) include:
(1) an applicant for a license under this chapter;
(2) a license holder;
(3) a partner, officer, director, or managing employee
of a license holder or applicant; and
(4) a controlling person.
(h) A penalty assessed under Subsection (a)(6) is in
addition to the penalty previously assessed and not timely paid.
(i) The commission shall develop and use a system to record
and track the scope and severity of each violation of this chapter
or a rule, standard, or order adopted under this chapter for the
purpose of assessing an administrative penalty for the violation or
taking some other enforcement action against the appropriate
inpatient rehabilitation facility to deter future violations. The
system:
(1) must be comparable to the system used by the
Centers for Medicare and Medicaid Services to categorize the scope
and severity of violations for a facility; and
(2) may be modified, as appropriate, to reflect
changes in industry practice or changes made to the system used by
the Centers for Medicare and Medicaid Services.
Sec. 260E.0307. VIOLATION OF LAW RELATING TO ADVANCE
DIRECTIVES. (a) The commission shall assess an administrative
penalty under this subchapter against an inpatient rehabilitation
facility that violates Section 166.004.
(b) Notwithstanding Sections 260E.0305(b) and (c):
(1) a penalty assessed in accordance with this section
must be $500; and
(2) a separate penalty may not be assessed for a
separate day of a continuing violation.
(c) Section 260E.0308 does not apply to a penalty assessed
in accordance with this section.
Sec. 260E.0308. RIGHT TO CORRECT. (a) In this section:
(1) "Actual harm" means a negative outcome that
compromises a patient's physical, mental, or emotional well-being.
(2) "Immediate threat to the health or safety of a
patient" means a situation that causes, or is likely to cause,
serious injury, harm, or impairment to or the death of a patient.
(3) "Pattern of violation" means repeated, but not
pervasive, failures of an inpatient rehabilitation facility to
comply with this chapter or a rule, standard, or order adopted under
this chapter that:
(A) result in a violation; and
(B) are found throughout the services provided by
the facility or that affect or involve the same patients or facility
employees.
(4) "Widespread in scope" means a violation of this
chapter or a rule, standard, or order adopted under this chapter
that:
(A) is pervasive throughout the services
provided by the inpatient rehabilitation facility; or
(B) represents a systemic failure by the facility
affecting or having the potential to affect a large portion of or
all of the facility patients.
(b) The commission may not collect an administrative
penalty against an inpatient rehabilitation facility under this
subchapter if, not later than the 45th day after the date the
facility receives notice under Section 260E.0309(c), the facility
corrects the violation.
(c) Subsection (b) does not apply:
(1) to a violation that the commission determines:
(A) represents a pattern of violation that
results in actual harm;
(B) is widespread in scope and results in actual
harm;
(C) is widespread in scope, constitutes a
potential for actual harm, and relates to:
(i) patients' rights;
(ii) treatment of patients;
(iii) patient behavior and inpatient
rehabilitation facility practices;
(iv) quality of care;
(v) medication errors;
(vi) standard menus and nutritional
adequacy;
(vii) physician visits;
(viii) infection control;
(ix) life safety from fire; or
(x) emergency preparedness and response;
(D) constitutes an immediate threat to the health
or safety of a patient; or
(E) substantially limits the facility's capacity
to provide care;
(2) to a violation described by Section
260E.0306(a)(2), (3), (4), (5), (6), or (7);
(3) to a violation of Section 260A.014 or 260A.015; or
(4) to a second or subsequent violation of Section
326.002 that occurs before the second anniversary of the date of the
first violation.
(d) An inpatient rehabilitation facility that corrects a
violation under Subsection (b) must maintain the correction. If
the facility fails to maintain the correction until at least the
first anniversary of the correction date, the commission may assess
an administrative penalty under this subchapter for the subsequent
violation. A penalty assessed under this subsection shall be equal
to three times the amount of the penalty assessed but not collected
under Subsection (b). The commission is not required to provide the
facility an opportunity to correct the subsequent violation under
this section.
Sec. 260E.0309. REPORT RECOMMENDING ADMINISTRATIVE
PENALTY. (a) The commission may issue a preliminary report stating
the facts on which the commission concludes that a violation of this
chapter or a rule, standard, or order adopted or license issued
under this chapter has occurred if the commission has:
(1) examined the possible violation and facts
surrounding the possible violation; and
(2) concluded that a violation has occurred.
(b) The report may recommend a penalty under Section
260E.0311 and the amount of the penalty.
(c) Not later than the 10th day after the date on which the
report is issued, the commission shall give written notice of the
report to the person charged with the violation. The notice must
include:
(1) a brief summary of the charges;
(2) a statement of the recommended penalty amount;
(3) a statement of whether the violation is subject to
correction under Section 260E.0308 and, if the violation is subject
to correction under that section, a statement of:
(A) the date on which the inpatient
rehabilitation facility must file with the commission a plan of
correction to be approved by the commission; and
(B) the date on which the plan of correction must
be completed to avoid assessment of the penalty; and
(4) a statement that the person charged has a right to
a hearing on the occurrence of the violation, the amount of the
penalty, or both.
(d) Not later than the 20th day after the date on which the
notice under Subsection (c) is sent, the person charged may:
(1) provide to the commission written consent to the
commission's report, including the recommended penalty;
(2) submit a written request for a hearing; or
(3) if the violation is subject to correction under
Section 260E.0308, submit a plan of correction to the commission
for approval.
(e) If the violation is subject to correction under Section
260E.0308 and the person reports to the commission that the
violation has been corrected, the commission shall inspect the
correction or take another step necessary to confirm the violation
has been corrected and shall notify the person that:
(1) the correction is satisfactory and that a penalty
is not assessed; or
(2) the correction is not satisfactory and that a
penalty is recommended.
(f) Not later than the 20th day after the date on which a
notice under Subsection (e)(2) is sent, the person charged may:
(1) provide to the commission written consent to the
commission's report, including the recommended penalty; or
(2) submit a written request for a hearing.
(g) If the person charged with the violation consents to the
administrative penalty the commission recommends, does not timely
respond to a notice sent under Subsection (c) or (e), or fails to
correct the violation to the commission's satisfaction, the
commission shall assess the recommended administrative penalty.
(h) If the commission assesses the recommended penalty, the
commission shall give written notice to the person charged of the
decision and the person shall pay the penalty.
Sec. 260E.0310. HEARINGS ON ADMINISTRATIVE PENALTIES. (a)
An administrative law judge of the State Office of Administrative
Hearings shall order a hearing and the commission shall give notice
of the hearing if a person charged under Section 260E.0309(c)
requests a hearing.
(b) The hearing must be held before an administrative law
judge.
(c) The administrative law judge shall make findings of fact
and conclusions of law regarding the occurrence of a violation of
this chapter or a rule or order adopted or license issued under this
chapter.
(d) Based on the findings of fact and conclusions of law,
the administrative law judge by order shall find:
(1) a violation has occurred and assess an
administrative penalty; or
(2) a violation has not occurred.
(e) Proceedings under this section are subject to Chapter
2001, Government Code.
Sec. 260E.0311. NOTICE AND PAYMENT OF ADMINISTRATIVE
PENALTY; INTEREST; REFUND. (a) The commission shall provide
notice of the decision taken under Section 260E.0310(d) to the
person charged. If the commission determines a violation has
occurred and assesses an administrative penalty, the commission
shall provide to the person charged written notice of:
(1) the determination;
(2) the amount of the penalty;
(3) the rate of interest payable with respect to the
penalty and the date on which interest begins to accrue;
(4) whether payment of the penalty or other action
under Section 260E.0313 is required; and
(5) the person's right to judicial review of the order.
(b) Not later than the 30th day after the date on which the
commission's order becomes final, the person charged with the
penalty shall:
(1) pay the full amount of the penalty; or
(2) file a petition for judicial review contesting the
occurrence of the violation, the amount of the penalty, the failure
to correct the violation to the commission's satisfaction, or all
of the above.
(c) Notwithstanding Subsection (b), the commission may
permit the person to pay the penalty in installments or may require
the person to use the amount of the penalty under the commission's
supervision in accordance with Section 260E.0313.
(d) If the person does not pay the penalty within the 30-day
period:
(1) the penalty is subject to interest; and
(2) the commission may refer the matter to the
attorney general for collection of the penalty and interest.
(e) If a penalty is reduced or not assessed, the commission
shall:
(1) remit to the person charged the appropriate amount
of any penalty payment plus accrued interest; or
(2) execute a release of the supersedeas bond if one
has been posted.
(f) Accrued interest on amounts remitted by the commission
under Subsection (e)(1) must be paid:
(1) at a rate equal to the rate charged on loans to
depository institutions by the New York Federal Reserve Bank; and
(2) for the period beginning on the date the penalty is
paid under Subsection (b) and ending on the date the penalty is
remitted.
(g) Interest under Subsection (d) must be paid:
(1) at a rate equal to the rate charged on loans to
depository institutions by the New York Federal Reserve Bank; and
(2) for the period beginning on the date the notice of
the commission's order is received by the person and ending on the
date the penalty is paid.
Sec. 260E.0312. APPLICATION OF OTHER LAW. The commission
may not assess more than one monetary penalty under this chapter and
Chapter 32, Human Resources Code, for a violation arising out of the
same act or failure to act, except as provided by Section
260E.0308(d). The commission may assess the greater of a monetary
penalty under this chapter or a monetary penalty under Chapter 32,
Human Resources Code, for the same act or failure to act.
Sec. 260E.0313. AMELIORATION OF VIOLATION. (a) In this
section, "immediate jeopardy to health and safety" means a
situation in which immediate corrective action is necessary because
an inpatient rehabilitation facility's noncompliance with one or
more requirements has caused, or is likely to cause, serious
injury, harm, impairment, or death to a patient receiving care in
the facility.
(b) In lieu of demanding payment of an administrative
penalty assessed under Section 260E.0306, the commission may, in
accordance with this section, allow the person to use, under the
commission's supervision, any portion of the penalty to ameliorate
the violation or to improve services, other than administrative
services, in the inpatient rehabilitation facility affected by the
violation.
(c) The commission shall offer amelioration to a person for
a charged violation if the commission determines that the violation
does not constitute immediate jeopardy to the health and safety of a
facility patient.
(d) The commission may not offer amelioration to a person
if:
(1) the person has been charged with a violation that
is subject to correction under Section 260E.0308; or
(2) the commission determines the charged violation
constitutes immediate jeopardy to the health and safety of an
inpatient rehabilitation facility patient.
(e) The commission shall offer amelioration to a person
under this section not later than the 10th day after the date the
person receives from the commission a final notice of assessment of
administrative penalty that is sent to the person after an informal
dispute resolution process but before an administrative hearing
under Section 260E.0310.
(f) A person to whom the commission offers amelioration
shall file a plan for amelioration not later than the 45th day after
the date the person receives the amelioration offer. In submitting
the plan, the person must agree to waive the person's right to an
administrative hearing under Section 260E.0310 if the commission
approves the plan.
(g) At a minimum, a plan for amelioration must:
(1) propose changes to the management or operation of
the inpatient rehabilitation facility that will improve services to
or quality of care of facility patients;
(2) identify, through measurable outcomes, the ways in
which and the extent to which the proposed changes will improve
services to or quality of care of facility patients;
(3) establish clear goals to be achieved through the
proposed changes;
(4) establish a timeline for implementing the proposed
changes; and
(5) identify specific actions necessary to implement
the proposed changes.
(h) A plan for amelioration may include proposed changes to:
(1) improve staff recruitment and retention;
(2) offer or improve rehabilitation services for
patients; and
(3) improve the overall quality of care for patients.
(i) The commission may require an amelioration plan to
propose changes that would result in conditions exceeding the
requirements of this chapter or the rules adopted under this
chapter.
(j) The commission shall approve or deny an amelioration
plan not later than the 45th day after the date the commission
receives the plan. On approval of a person's plan, the commission
shall deny a pending request for a hearing submitted by the person
under Section 260E.0309(d).
(k) The commission may not offer amelioration to a person:
(1) more than three times in a two-year period; or
(2) more than one time in a two-year period for the
same or similar violation.
Sec. 260E.0314. OTHER REMEDIES. (a) If the commission
finds that an inpatient rehabilitation facility has committed an
act for which a civil penalty may be imposed under Section
260E.0305, the commission may, as appropriate under the
circumstances, order the facility to immediately suspend
admissions.
(b) A suspension of admissions ordered under Subsection (a)
is effective on the date a representative of the inpatient
rehabilitation facility receives notice of the order and of the
manner in which the order may be appealed. Not later than the 14th
day after the date the suspension becomes effective, the commission
must provide an opportunity for a hearing with respect to an appeal
of the order.
(c) During the period that an inpatient rehabilitation
facility is ordered to suspend admissions, the facility shall post
a notice of the suspension on all doors providing ingress to and
egress from the facility. The notice must be posted in the form the
commission requires.
(d) A person commits an offense if the person knowingly:
(1) violates Subsection (c); or
(2) removes a notice posted under Subsection (c)
before the inpatient rehabilitation facility is allowed to admit
patients.
(e) An offense under Subsection (d) is a Class C
misdemeanor.
(f) A court having jurisdiction of a judicial review of the
matter may not order arbitration, whether on motion of any party or
on the court's own motion, to resolve a dispute involving an order
suspending admissions under this section or the conduct with
respect to which the order suspending admissions is sought.
SECTION 6. (a) As soon as practicable after the effective
date of this Act but not later than January 1, 2026, the executive
commissioner of the Health and Human Services Commission shall
adopt rules as required by this Act.
(b) Notwithstanding Chapter 260E, Health and Safety Code,
as added by this Act, a person is not required to hold a license
under that chapter until September 1, 2026.
SECTION 7. This Act takes effect September 1, 2025.