By: Maxey H.B. No. 2552 73R5682 DLF-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the establishment, powers, and duties of the State 1-3 Health Resources Planning and Cost Containment Commission; 1-4 providing penalties. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. Subtitle A, Title 4, Health and Safety Code, is 1-7 amended by adding Chapter 230 to read as follows: 1-8 CHAPTER 230. HEALTH RESOURCES PLANNING AND COST CONTAINMENT 1-9 SUBCHAPTER A. GENERAL PROVISIONS 1-10 Sec. 230.001. DEFINITIONS. In this chapter: 1-11 (1) "Commission" means the State Health Resources 1-12 Planning and Cost Containment Commission appointed under this 1-13 chapter. 1-14 (2) "Executive director" means the executive director 1-15 of the commission. 1-16 (3) "Regional committee" means a regional advisory 1-17 planning committee appointed under this chapter. 1-18 (4) "Health care facility" means any facility at which 1-19 health services are offered to the public, including: 1-20 (A) a public or private hospital; 1-21 (B) a skilled nursing facility; 1-22 (C) an intermediate care facility; 1-23 (D) an ambulatory surgical facility and any 1-24 other facility that performs ambulatory surgical procedures; 2-1 (E) a rural or urban health initiative clinic; 2-2 (F) a kidney disease treatment facility; 2-3 (G) an inpatient rehabilitation facility; 2-4 (H) an institution licensed under Chapter 242; 2-5 (I) a home health care agency, including a 2-6 hospice; 2-7 (J) a clinic or other facility operated by a 2-8 preferred provider arrangement or health maintenance organization; 2-9 (K) the office of one or more physicians, 2-10 podiatrists, or dentists; or 2-11 (L) any other facility designated as a health 2-12 care facility by federal law. 2-13 (5) "Health service region" means a region designated 2-14 by the board under Section 230.041. 2-15 (6) "State plan" means the comprehensive state health 2-16 care plan developed under Section 230.029. 2-17 SUBCHAPTER B. STATE HEALTH RESOURCES PLANNING 2-18 AND COST CONTAINMENT COMMISSION 2-19 Sec. 230.021. COMMISSION ESTABLISHED. The State Health 2-20 Resources Planning and Cost Containment Commission is an 2-21 independent commission in the department. 2-22 Sec. 230.022. MEMBERSHIP. (a) The commission is composed 2-23 of 13 members. Twelve of the members are appointed by the governor 2-24 with the advice and consent of the senate as follows: 2-25 (1) five consumers of health care services 2-26 representing regional committees; 2-27 (2) two consumers of health care services representing 3-1 the public at large; and 3-2 (3) five health care providers, at least three of whom 3-3 shall represent health care facilities. 3-4 (b) Each appointed member of the commission must have 3-5 demonstrated interest or experience in addressing health care 3-6 problems. 3-7 (c) The commissioner shall serve as an ex officio member of 3-8 the commission and, except as provided by Section 230.023, may vote 3-9 on matters before the commission. 3-10 (d) The appointed members of the commission serve staggered 3-11 six-year terms, with the terms of four members expiring on February 3-12 1 of each odd-numbered year. 3-13 (e) In the event of a vacancy during a term, the governor 3-14 shall fill the vacancy with a person who meets the qualifications 3-15 of the vacated position. 3-16 Sec. 230.023. LIMITATION ON DUTIES OF COMMISSIONER. The 3-17 commissioner may not participate in the commission's consideration 3-18 of: 3-19 (1) an application for a permit of approval under 3-20 Subchapter D; or 3-21 (2) personnel matters involving commission staff. 3-22 Sec. 230.024. COMPENSATION; EXPENSES. An appointed member 3-23 of the commission is entitled to: 3-24 (1) compensation as provided in the General 3-25 Appropriations Act; and 3-26 (2) reimbursement for expenses incurred in performing 3-27 the member's duties at the rate provided in the General 4-1 Appropriations Act. 4-2 Sec. 230.025. PRESIDING OFFICER; ASSISTANT PRESIDING 4-3 OFFICER. Annually, the governor shall designate an appointed 4-4 member of the commission to serve as presiding officer. The 4-5 presiding officer shall designate an appointed member of the 4-6 commission to serve as assistant presiding officer. 4-7 Sec. 230.026. EXECUTIVE DIRECTOR; STAFF. (a) The 4-8 commission shall employ an executive director, who is responsible 4-9 for administering the functions of the commission. 4-10 (b) The executive director may employ staff as necessary to 4-11 carry out the functions of the commission. The commission shall 4-12 compensate staff as provided in the General Appropriations Act. 4-13 Sec. 230.027. MEETINGS; APPLICABILITY OF OPEN MEETINGS AND 4-14 OPEN RECORDS LAWS. (a) The commission shall meet as prescribed by 4-15 the rules of the commission and at the call of the presiding 4-16 officer. 4-17 (b) The commission is subject to the open meetings law, 4-18 Chapter 271, Acts of the 60th Legislature, Regular Session, 1967 4-19 (Article 6252-17, Vernon's Texas Civil Statutes), and the open 4-20 records law, Chapter 424, Acts of the 63rd Legislature, Regular 4-21 Session, 1973 (Article 6252-17a, Vernon's Texas Civil Statutes). 4-22 Sec. 230.028. GENERAL POWERS. The commission may: 4-23 (1) adopt rules to implement this chapter; 4-24 (2) establish subcommittees from among its members; 4-25 (3) appoint advisory committees; 4-26 (4) apply for and accept federal funds and private 4-27 grants to implement this chapter; 5-1 (5) contract with any person for studies, development 5-2 of information, and provision of services to implement this 5-3 chapter; and 5-4 (6) conduct hearings. 5-5 Sec. 230.029. COMPREHENSIVE STATE HEALTH PLAN; REPORT. (a) 5-6 The commission shall study the service capacity of health care 5-7 facilities in this state on a continuing basis and shall develop a 5-8 comprehensive state health plan. The goal of the plan is to ensure 5-9 the development and maintenance of health care facilities to 5-10 provide comprehensive health care services for all health service 5-11 regions in an equitable manner. 5-12 (b) The state plan must address: 5-13 (1) the education of health care professionals; 5-14 (2) research needs; 5-15 (3) the introduction and placement of high-technology 5-16 equipment and new health care facilities; 5-17 (4) the addition of new beds in existing health care 5-18 facilities; 5-19 (5) the appropriate number of various types of health 5-20 care professionals located in particular health care facilities and 5-21 health service regions; 5-22 (6) the establishment of regional trauma and tertiary 5-23 care systems; and 5-24 (7) the needs of underserved regions and 5-25 recommendations for addressing those needs, including the 5-26 establishment of incentive programs. 5-27 (c) To develop the state plan, the commission may study: 6-1 (1) the adequacy of health care services and financial 6-2 resources to meet the needs of the population; 6-3 (2) the allocation and distribution of health care 6-4 resources; 6-5 (3) the cost of health care in relationship to 6-6 financial resources; and 6-7 (4) any other appropriate matter. 6-8 (d) In developing the state plan, the commission shall 6-9 consider the input of regional committees. 6-10 (e) Not later than February 1 of each odd-numbered year, the 6-11 commission shall file the state plan with the governor and the 6-12 presiding officer of each house of the legislature. 6-13 Sec. 230.030. INFORMATION FROM HEALTH CARE FACILITIES; 6-14 ADMINISTRATIVE PENALTY. (a) The commission may request, collect, 6-15 and report any statistical or other information that is needed by 6-16 the commission to perform its duties under this chapter. The 6-17 information must be described by rule adopted by the commission. 6-18 The commission may not require information that is confidential by 6-19 law, except that the commission may require summaries of 6-20 confidential information that do not identify individual patients 6-21 or health care professionals. 6-22 (b) A person that refuses to provide the information commits 6-23 an administrative violation and the commission may assess an 6-24 administrative penalty against the person as provided by this 6-25 section. 6-26 (c) The penalty for each violation may not exceed $100. 6-27 Each day a violation continues or occurs may be considered a 7-1 separate violation for purposes of penalty assessments. 7-2 (d) In determining the amount of the penalty, the executive 7-3 director shall consider: 7-4 (1) the seriousness of the violation; 7-5 (2) the history of previous violations; 7-6 (3) the amount necessary to deter future violations; 7-7 (4) efforts to correct the violation; and 7-8 (5) any other matter that justice may require. 7-9 (e) If, after investigation of a possible violation and the 7-10 facts surrounding that possible violation, the executive director 7-11 determines that a violation has occurred, the executive director 7-12 may issue a violation report stating the facts on which the 7-13 conclusion that a violation occurred is based, recommending that an 7-14 administrative penalty under this section be imposed on the person 7-15 charged, and recommending the amount of that proposed penalty. The 7-16 executive director shall base the recommended amount of the 7-17 proposed penalty on the seriousness of the violation determined by 7-18 consideration of the factors set forth in Subsection (d). 7-19 (f) Not later than the 14th day after the date on which the 7-20 report is issued, the executive director shall give written notice 7-21 of the report to the person charged. The notice shall include a 7-22 brief summary of the charges, a statement of the amount of the 7-23 penalty recommended, and a statement of the right of the person 7-24 charged to a hearing on the occurrence of the violation, the amount 7-25 of the penalty, or both. 7-26 (g) Not later than the 20th day after the date on which 7-27 notice is received, the person charged may accept the determination 8-1 of the executive director made under Subsection (e), including the 8-2 recommended penalty, or make a written request for a hearing on the 8-3 determination. 8-4 (h) If the person charged with the violation accepts the 8-5 determination of the executive director, the commission shall issue 8-6 an order approving the determination and ordering the payment of 8-7 the recommended penalty. 8-8 (i) If the person charged requests a hearing or fails to 8-9 timely respond to the notice, the executive director shall set a 8-10 hearing and give notice of the hearing. The hearing shall be held 8-11 by the State Office of Administrative Hearings. The State Office 8-12 of Administrative Hearings shall make findings of fact and 8-13 conclusions of law and promptly issue to the commission a proposal 8-14 for decision as to the occurrence of the violation, including a 8-15 recommendation as to the amount of the penalty. Based on the 8-16 findings of fact, conclusions of law, and recommendations of the 8-17 administrative law judge, the commission by order may find a 8-18 violation has occurred and may assess a penalty or may find that no 8-19 violation has occurred. All proceedings under this subsection are 8-20 subject to the Administrative Procedure and Texas Register Act 8-21 (Article 6252-13a, Vernon's Texas Civil Statutes). 8-22 (j) The executive director shall give notice of the 8-23 commission's order to the person charged. The notice shall 8-24 include: 8-25 (1) the findings of fact and conclusions of law 8-26 separately stated; 8-27 (2) the amount of the penalty ordered, if any; 9-1 (3) a statement of the right of the person charged to 9-2 judicial review of the commission's order, if any; and 9-3 (4) other information required by law. 9-4 (k) Within the 30-day period immediately following the day 9-5 on which the order becomes final as provided by Section 16(c), 9-6 Administrative Procedure and Texas Register Act (Article 6252-13a, 9-7 Vernon's Texas Civil Statutes), the person charged with the penalty 9-8 shall: 9-9 (1) pay the penalty in full; or 9-10 (2) if the person files a petition for judicial review 9-11 contesting either the amount of the penalty or the fact of the 9-12 violation or contesting both the fact of the violation and the 9-13 amount of the penalty: 9-14 (A) forward the amount to the executive director 9-15 for placement in an escrow account; or 9-16 (B) in lieu of payment into escrow, post with 9-17 the executive director a supersedeas bond in a form approved by the 9-18 executive director for the amount of the penalty, the bond to be 9-19 effective until all judicial review of the order or decision is 9-20 final. 9-21 (l) If a person charged is financially unable to either 9-22 forward the amount of the penalty for placement in an escrow 9-23 account or post a supersedeas bond for the amount of the penalty, 9-24 the person may satisfy the requirements of Subsection (k)(2) by 9-25 filing with the executive director an affidavit sworn by the person 9-26 charged, stating that the person is financially unable to either 9-27 forward the amount of the penalty or post a bond. 10-1 (m) Failure to forward the money to or to post the bond or 10-2 file the affidavit with the executive director within the time 10-3 provided by Subsection (k) results in a waiver of all legal rights 10-4 to judicial review. Also, if the person charged fails to pay the 10-5 penalty in full as provided under Subsection (k)(1) or forward the 10-6 money, post the bond, or file the affidavit as provided by 10-7 Subsection (k) or (l), the executive director may forward the 10-8 matter to the attorney general for enforcement. 10-9 (n) Judicial review of the order or decision of the 10-10 commission assessing the penalty shall be under the substantial 10-11 evidence rule and shall be instituted by filing a petition with a 10-12 district court in Travis County, as provided by Section 19, 10-13 Administrative Procedure and Texas Register Act (Article 6252-13a, 10-14 Vernon's Texas Civil Statutes). 10-15 (o) If the penalty is reduced or not assessed by the court, 10-16 the executive director shall remit to the person charged the 10-17 appropriate amount plus accrued interest if the penalty has been 10-18 paid or shall execute a release of the bond if a supersedeas bond 10-19 has been posted. The accrued interest on amounts remitted by the 10-20 executive director under this section shall be paid at a rate equal 10-21 to the rate charged on loans to depository institutions by the New 10-22 York Federal Reserve Bank and shall be paid for the period 10-23 beginning on the date the penalty is paid to the executive director 10-24 under Subsection (k) and ending on the date the penalty is 10-25 remitted. 10-26 (p) A penalty collected under this section shall be 10-27 deposited in the state general revenue fund. 11-1 Sec. 230.031. APPLICABILITY OF SUNSET ACT. The commission 11-2 is subject to Chapter 325, Government Code (Texas Sunset Act). 11-3 Unless continued in existence as provided by that chapter, the 11-4 commission is abolished September 1, 2005. 11-5 SUBCHAPTER C. HEALTH SERVICE REGIONS AND 11-6 REGIONAL ADVISORY PLANNING COMMITTEES 11-7 Sec. 230.041. HEALTH SERVICE REGIONS. The board shall 11-8 divide the state into health service regions. 11-9 Sec. 230.042. REGIONAL ADVISORY PLANNING COMMITTEES. (a) 11-10 The board shall provide for the appointment of a regional advisory 11-11 planning committee for each health service region. 11-12 (b) Each regional committee is composed of nine members as 11-13 follows: 11-14 (1) five representatives of consumers, including two 11-15 representatives of employers; and 11-16 (2) four representatives of health care facilities. 11-17 (c) Members of each regional committee shall serve two-year 11-18 terms expiring March 1 of each odd-numbered year. Members may not 11-19 serve more than two complete consecutive terms. 11-20 (d) In the event of a vacancy during a term, including a 11-21 vacancy under Section 230.045(b), the vacancy shall be filled in 11-22 the same manner as the original appointment was made. 11-23 Sec. 230.043. PRESIDING OFFICER. Each regional committee 11-24 shall elect a presiding officer from among its members. 11-25 Sec. 230.044. COMMITTEE PROCEDURES. The board shall adopt 11-26 rules and procedures for the regional committees and shall 11-27 establish deadlines for committee activities to ensure the 12-1 committee's input in the development and revision of the state 12-2 plan. 12-3 Sec. 230.045. PUBLIC TESTIMONY. (a) Each regional 12-4 committee shall meet not less than four times each year to take 12-5 public testimony relating to the state plan and the health care 12-6 needs of the health service region. 12-7 (b) A member who is absent for more than two of the meetings 12-8 required by this section during the member's two-year term is 12-9 ineligible to continue to serve on the committee. 12-10 Sec. 230.046. MEETINGS. A regional committee may hold 12-11 meetings in addition to those required under Section 230.045 at the 12-12 call of the chair. 12-13 SUBCHAPTER D. PERMIT OF APPROVAL 12-14 Sec. 230.061. APPLICATION FOR PERMIT OF APPROVAL; RULES; 12-15 FEE. (a) The commission shall adopt rules for application for a 12-16 permit of approval under this subchapter. 12-17 (b) The commission shall set a reasonable fee to accompany 12-18 an application for a permit of approval. 12-19 Sec. 230.062. ISSUANCE OF PERMIT; RULES AND STANDARDS. (a) 12-20 The commission shall adopt rules and standards for issuance of a 12-21 permit of approval under this subchapter. The standards for 12-22 issuance of a permit of approval must reflect the needs of the 12-23 health service regions as identified in the state plan. 12-24 (b) The commission may adopt rules waiving the requirement 12-25 of a permit of approval in specific circumstances delineated by 12-26 rule. Rules adopted under this subsection may relate to: 12-27 (1) the cost of the activity that would otherwise 13-1 require a certificate of approval; 13-2 (2) the type of medical services provided; 13-3 (3) the impact of the activity on the affected health 13-4 service region; and 13-5 (4) any other relevant matter. 13-6 Sec. 230.063. NEW HEALTH CARE FACILITY. A person may not 13-7 develop, construct, or establish a new health care facility unless 13-8 a permit of approval for that facility has been issued under this 13-9 chapter. 13-10 Sec. 230.064. RELOCATION OF HEALTH CARE FACILITY. A person 13-11 may not relocate an existing health care facility to a new site 13-12 unless a permit of approval for the relocation has been issued 13-13 under this chapter. 13-14 Sec. 230.065. INCREASE IN BED CAPACITY. (a) Except as 13-15 provided by Subsection (b), a person may not increase or decrease 13-16 the bed capacity of an existing health care facility unless a 13-17 permit of approval for the increase or decrease has been issued 13-18 under this chapter. 13-19 (b) The commission shall adopt rules relating to minimum 13-20 increases and decreases in bed capacity that do not require a 13-21 permit of approval under this section. 13-22 Sec. 230.066. CHANGE IN SERVICES. A person may not change 13-23 the type of services provided by a facility unless a permit of 13-24 approval for the change has been issued under this chapter. 13-25 Sec. 230.067. CAPITAL EXPENDITURES; PURCHASE OF CAPITAL 13-26 EQUIPMENT. (a) A person may not make an expenditure for or on 13-27 behalf of a health care facility without a permit of approval if 14-1 the expenditure is not properly chargeable as an operating or 14-2 maintenance expense of the facility and: 14-3 (1) the expenditure exceeds $900,000 and is made as 14-4 part of an improvement to or expansion of the facility; or 14-5 (2) the expenditure exceeds $500,000 and is made to 14-6 replace or purchase equipment for the facility. 14-7 (b) The commission may adopt rules adjusting the minimum 14-8 limits of this section for inflation. 14-9 (c) The commission shall adopt rules prohibiting a health 14-10 facility from avoiding the requirements of this section by 14-11 accounting for expenditures for a single project as separate costs. 14-12 Sec. 230.068. EXCEPTION: CERTAIN PRIVATE PHYSICIANS. This 14-13 subchapter does not apply to a health care facility used only by 14-14 one private physician or a group of private physicians practicing a 14-15 single specialty if the expenditures related to the activity that 14-16 would otherwise require a permit of approval are less than $1 14-17 million. 14-18 SECTION 2. (a) Chapter 225, Health and Safety Code, is 14-19 repealed. 14-20 (b) This section takes effect September 1, 1994. 14-21 SECTION 3. In making the initial appointments to the State 14-22 Health Resources Planning and Cost Containment Commission, the 14-23 governor shall appoint four members for terms expiring February 1, 14-24 1995, four members for terms expiring February 1, 1997, and four 14-25 members for terms expiring February 1, 1999. 14-26 SECTION 4. The State Board of Health shall provide for the 14-27 appointment of members of the regional advisory planning committees 15-1 established under Chapter 230, Health and Safety Code, as added by 15-2 this Act, not later than January 1, 1994. 15-3 SECTION 5. The State Health Resources Planning and Cost 15-4 Containment Commission shall adopt rules as required under Chapter 15-5 230, Health and Safety Code, as added by this Act, not later than 15-6 September 1, 1994. 15-7 SECTION 6. The State Health Resources Planning and Cost 15-8 Containment Commission may not require a person to hold a permit of 15-9 approval, as required by Chapter 230, Health and Safety Code, as 15-10 added by this Act, for any act or expenditure on behalf of a health 15-11 care facility that is made or contracted for before September 1, 15-12 1994. 15-13 SECTION 7. Except as provided by Section 2(b) of this Act, 15-14 this Act takes effect September 1, 1993. 15-15 SECTION 8. The importance of this legislation and the 15-16 crowded condition of the calendars in both houses create an 15-17 emergency and an imperative public necessity that the 15-18 constitutional rule requiring bills to be read on three several 15-19 days in each house be suspended, and this rule is hereby suspended.