Enrolled Bill Summary

            Senate Bill 30 amends various provisions relating to public welfare programs, especially Medicaid, primarily concerning fraud and recovery of erroneously paid benefits. The act requires the Health and Human Services Commission, in consultation with the Texas Department of Human Services, to set an annual minimum goal of the amount of erroneously paid food stamp and AFDC benefits that the department must recover and provides for reduction of the department's appropriation if the department falls short of the goal. The act requires the department to take various actions to combat fraud, including instituting a telephone collection program, using private collection agents, and determining payment errors promptly. The act also creates an investigations and enforcement office in the commission to coordinate the investigation of fraud in public welfare programs, and imposes various fraud prevention and prosecution duties on the commission, including implementing new fraud detection computer technologies, providing training on fraud prevention and detection, and coordinating fraud detection and prosecution with health and human services agencies and the attorney general's office. The act requires the transfer of staff and resources from the department and the Texas Department of Health to the commission to enable the commission to perform its fraud-related functions.

            The act also includes provisions to increase accountability of health care providers under the Medicaid program, including authorizing the department to obtain criminal history records of a provider and to require a provider to post a surety bond in certain circumstances. The act requires the Texas Department of Health to identify improper practices by service providers and requires the commission to develop a new provider contract with strengthened anti-fraud provisions. The act also requires managed care organizations providing Medicaid services to develop fraud prevention plans and report information necessary to detect fraud and ensure quality of care. The act provides for periodic auditing of each managed care organization that serves Medicaid beneficiaries.

            Senate Bill 30 also provides for increased sanctions against persons who commit Medicaid fraud, including increased administrative and civil penalties and higher penalties for persons whose fraud results in harm to a disabled or elderly person or to a child, new liability for managed care organizations that fail to provide required services or information or that engage in specified fraudulent activities, exclusion of providers who commit fraud from participating in the Medicaid program, deduction of erroneously paid food stamp and AFDC benefits from lottery prizes, suspension of driver's licenses of persons who fail to repay erroneously paid food stamp and AFDC benefits, creation of a criminal offense related to Medicaid fraud, and suspension of certain occupational licenses for persons convicted of the criminal offense. An enhanced criminal offense is created for a theft in which the actor was in a contractual relationship with government at the time of the offense and the property appropriated came into the actor's custody, possession, or control by virtue of the contractual relationship. The act also authorizes private citizens to bring lawsuits on behalf of the state against persons who commit Medicaid fraud and allows the citizen to receive a portion of the settlement or judgment.

            Finally, the act creates a broad civil cause of action, not limited to welfare programs, for presenting a false claim for payment to a state or local governmental entity. A private citizen is authorized to bring suit on behalf of the state and to share in the recovery. The act takes effect on September 1, 1997, although separate effective dates are specified for numerous provisions.