1-1 By: Harris of Tarrant, Moncrief, Zaffirini S.B. No. 209 1-2 (In the Senate - Filed January 29, 1993; February 1, 1993, 1-3 read first time and referred to Committee on Health and Human 1-4 Services; March 19, 1993, reported adversely, with favorable 1-5 Committee Substitute by the following vote: Yeas 8, Nays 0; 1-6 March 19, 1993, sent to printer.) 1-7 COMMITTEE VOTE 1-8 Yea Nay PNV Absent 1-9 Zaffirini x 1-10 Ellis x 1-11 Madla x 1-12 Moncrief x 1-13 Nelson x 1-14 Patterson x 1-15 Shelley x 1-16 Truan x 1-17 Wentworth x 1-18 COMMITTEE SUBSTITUTE FOR S.B. No. 209 By: Moncrief 1-19 A BILL TO BE ENTITLED 1-20 AN ACT 1-21 relating to the crime victims compensation fund; providing civil 1-22 and administrative penalties. 1-23 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-24 SECTION 1. The Crime Victims Compensation Act (Article 1-25 8309-1, Vernon's Texas Civil Statutes) is amended by adding Section 1-26 5 to read as follows: 1-27 Sec. 5. UTILIZATION REVIEW. (a) The attorney general may 1-28 adopt rules under which the attorney general may conduct or 1-29 contract for a utilization review of applications for benefits or 1-30 claims for pecuniary loss relating to psychological, psychiatric, 1-31 or other mental health services. 1-32 (b) In this section, "utilization review" means a system for 1-33 prospective, concurrent, or retrospective review of the necessity 1-34 and appropriateness of services being provided or proposed to be 1-35 provided to a victim. 1-36 SECTION 2. Subsection (a), Section 9, Crime Victims 1-37 Compensation Act (Article 8309-1, Vernon's Texas Civil Statutes), 1-38 is amended to read as follows: 1-39 (a) The attorney general on the attorney general's own 1-40 motion or on request of the claimant may reconsider a decision 1-41 making or denying an award or determining its amount. The attorney 1-42 general shall reconsider at least annually every award being paid 1-43 in installments. An order on reconsideration of an award shall not 1-44 require refund of amounts previously paid unless the award was paid 1-45 by mistake or obtained by fraud. 1-46 SECTION 3. The Crime Victims Compensation Act (Article 1-47 8309-1, Vernon's Texas Civil Statutes) is amended by adding 1-48 Sections 10A, 10B, and 10C to read as follows: 1-49 Sec. 10A. PUBLIC LETTER OF REPRIMAND. (a) The attorney 1-50 general may issue a letter of reprimand against a person if the 1-51 attorney general finds that the person has filed or has caused to 1-52 be filed under this Act an application for benefits or claim for 1-53 pecuniary loss that contains a statement or representation that the 1-54 person knows to be false. 1-55 (b) The attorney general must give the person notice of the 1-56 proposed action before issuing the letter. 1-57 (c) A proposal to issue a letter of reprimand is considered 1-58 a contested case for purposes of the Administrative Procedure and 1-59 Texas Register Act (Article 6252-13a, Vernon's Texas Civil 1-60 Statutes) and its subsequent amendments. 1-61 (d) A letter of reprimand issued under this section is 1-62 public information. 1-63 Sec. 10B. CIVIL PENALTY. (a) A person is subject to a 1-64 civil penalty of not less than $2,500 or more than $25,000 for each 1-65 application for benefits or claim for pecuniary loss that the 1-66 person files or causes to be filed under this Act that contains a 1-67 statement or representation that the person knows to be false. 1-68 (b) The attorney general shall institute and conduct the 2-1 suit authorized by this section in the name of this state. 2-2 (c) A civil penalty recovered under this section shall be 2-3 deposited to the credit of the Compensation to Victims of Crime 2-4 Fund. 2-5 (d) The civil penalty authorized by this section is in 2-6 addition to any other civil, administrative, or criminal penalty 2-7 provided by law. 2-8 (e) In addition to the civil penalty authorized by this 2-9 section, the attorney general may recover all expenses incurred by 2-10 the attorney general in the investigation, institution, and 2-11 prosecution of the suit including investigative costs, witness 2-12 fees, attorney fees, and deposition expenses. 2-13 Sec. 10C. ADMINISTRATIVE PENALTY. (a) A person who 2-14 presents or causes to be presented to the attorney general an 2-15 application for benefits or claim for pecuniary loss that contains 2-16 a statement or representation the person knows to be false is 2-17 liable to the attorney general for: 2-18 (1) the amount paid because of the false application 2-19 for benefits or claim for pecuniary loss and interest on that 2-20 amount determined at the rate provided by law for legal judgments 2-21 and accruing from the date on which the payment was made; 2-22 (2) payment of an administrative penalty not to exceed 2-23 twice the amount paid because of the false application for benefits 2-24 or claim for pecuniary loss; and 2-25 (3) payment of an administrative penalty of not more 2-26 than $10,000 for each item or service for which payment was 2-27 claimed. 2-28 (b) In determining the amount of the penalty to be assessed 2-29 under Subdivision (3) of Subsection (a) of this section, the 2-30 attorney general shall consider: 2-31 (1) the seriousness of the violation; 2-32 (2) whether the person had previously submitted a 2-33 false application for benefits or claim for pecuniary loss; and 2-34 (3) the amount necessary to deter the person from 2-35 submitting future false applications for benefits or claims for 2-36 pecuniary loss. 2-37 (c) If the attorney general determines that a violation has 2-38 occurred, the attorney general may issue a report that states the 2-39 facts on which the determination is made and the attorney general's 2-40 recommendation on the imposition of a penalty, including a 2-41 recommendation on the amount of the penalty. 2-42 (d) The attorney general shall give written notice of the 2-43 report to the person. The notice may be given by certified mail. 2-44 The notice must include a brief summary of the alleged violation 2-45 and a statement of the amount of the recommended penalty and must 2-46 inform the person that the person has a right to a hearing on the 2-47 occurrence of the violation, the amount of the penalty, or both the 2-48 occurrence of the violation and the amount of the penalty. 2-49 (e) Within 20 days after the date the person receives the 2-50 notice, the person in writing may accept the determination and 2-51 recommended penalty of the attorney general or may make a written 2-52 request for a hearing on the occurrence of the violation, the 2-53 amount of the penalty, or both the occurrence of the violation and 2-54 the amount of the penalty. 2-55 (f) If the person accepts the determination and recommended 2-56 penalty of the attorney general, the attorney general by order 2-57 shall approve the determination and impose the recommended penalty. 2-58 (g) If the person requests a hearing or fails to respond 2-59 timely to the notice, the attorney general shall set a hearing and 2-60 give notice of the hearing to the person. The administrative law 2-61 judge shall make findings of fact and conclusions of law and 2-62 promptly issue to the attorney general a proposal for a decision 2-63 about the occurrence of the violation and the amount of a proposed 2-64 penalty. According to the findings of fact, conclusions of law, 2-65 and proposal for a decision, the attorney general by order may find 2-66 that a violation has occurred and impose a penalty or may find that 2-67 no violation occurred. 2-68 (h) The notice of the attorney general's order given to the 2-69 person under the Administrative Procedure and Texas Register Act 2-70 (Article 6252-13a, Vernon's Texas Civil Statutes) and its 3-1 subsequent amendments must include a statement of the right of the 3-2 person to judicial review of the order. 3-3 (i) Within 30 days after the date the attorney general's 3-4 order is final as provided by Subsection (c) of Section 16, 3-5 Administrative Procedure and Texas Register Act (Article 6252-13a, 3-6 Vernon's Texas Civil Statutes), and its subsequent amendments, the 3-7 person shall: 3-8 (1) pay the amount of the penalty; 3-9 (2) pay the amount of the penalty and file a petition 3-10 for judicial review contesting the occurrence of the violation, the 3-11 amount of the penalty, or both the occurrence of the violation and 3-12 the amount of the penalty; or 3-13 (3) without paying the amount of the penalty, file a 3-14 petition for judicial review contesting the occurrence of the 3-15 violation, the amount of the penalty, or both the occurrence of the 3-16 violation and the amount of the penalty. 3-17 (j) Within the 30-day period, a person who acts under 3-18 Subdivision (3) of Subsection (i) of this section may: 3-19 (1) stay enforcement of the penalty by: 3-20 (A) paying the amount of the penalty to the 3-21 court for placement in an escrow account; or 3-22 (B) giving to the court a supersedeas bond 3-23 approved by the court for the amount of the penalty and that is 3-24 effective until all judicial review of the attorney general's order 3-25 is final; or 3-26 (2) request the court to stay enforcement of the 3-27 penalty by: 3-28 (A) filing with the court a sworn affidavit of 3-29 the person stating that the person is financially unable to pay the 3-30 amount of the penalty and is financially unable to give the 3-31 supersedeas bond; and 3-32 (B) giving a copy of the affidavit to the 3-33 attorney general by certified mail. 3-34 (k) On receipt by the attorney general of a copy of an 3-35 affidavit under Subdivision (2) of Subsection (j) of this section, 3-36 the attorney general may file, with the court within five days 3-37 after the date the copy is received, a contest to the affidavit. 3-38 The court shall hold a hearing on the facts alleged in the 3-39 affidavit as soon as practicable and shall stay the enforcement of 3-40 the penalty on finding that the alleged facts are true. The person 3-41 who files an affidavit has the burden of proving that the person is 3-42 financially unable to pay the amount of the penalty and to give a 3-43 supersedeas bond. 3-44 (l) If the person does not pay the amount of the penalty and 3-45 the enforcement of the penalty is not stayed, the attorney general 3-46 may file suit for collection of the amount of the penalty. 3-47 (m) Judicial review of the order of the attorney general: 3-48 (1) is instituted by filing a petition as provided by 3-49 Section 19, Administrative Procedure and Texas Register Act 3-50 (Article 6252-13a, Vernon's Texas Civil Statutes), and its 3-51 subsequent amendments; and 3-52 (2) is under the substantial evidence rule. 3-53 (n) If the court sustains the occurrence of the violation, 3-54 the court may uphold or reduce the amount of the penalty and order 3-55 the person to pay the full or reduced amount of the penalty. If 3-56 the court does not sustain the occurrence of the violation, the 3-57 court shall order that no penalty is owed. 3-58 (o) When the judgment of the court becomes final, the court 3-59 shall proceed under this subsection. If the person paid the amount 3-60 of the penalty and if that amount is reduced or is not upheld by 3-61 the court, the court shall order that the appropriate amount plus 3-62 accrued interest be remitted to the person. The rate of the 3-63 interest is the rate charged on loans to depository institutions by 3-64 the New York Federal Reserve Bank, and the interest shall be paid 3-65 for the period beginning on the date the penalty was paid and 3-66 ending on the date the penalty is remitted. If the person gave a 3-67 supersedeas bond and if the amount of the penalty is not upheld by 3-68 the court, the court shall order the release of the bond. If the 3-69 person gave a supersedeas bond and if the amount of the penalty is 3-70 reduced, the court shall order the release of the bond after the 4-1 person pays the amount. 4-2 (p) A penalty collected under this section shall be sent to 4-3 the comptroller and deposited to the credit of the Compensation to 4-4 Victims of Crime Fund. 4-5 (q) All proceedings under this section are subject to the 4-6 Administrative Procedure and Texas Register Act (Article 6252-13a, 4-7 Vernon's Texas Civil Statutes) and its subsequent amendments. 4-8 (r) In addition to the administrative penalty authorized by 4-9 this section, the attorney general may recover all expenses 4-10 incurred by the attorney general in the investigation, institution, 4-11 and prosecution of the suit including investigative costs, witness 4-12 fees, attorney's fees, and deposition expenses. 4-13 SECTION 4. Sections 10A, 10B, and 10C, Crime Victims 4-14 Compensation Act (Article 8309-1, Vernon's Texas Civil Statutes), 4-15 as added by Section 3 of this Act, apply only to an application for 4-16 benefits or claim for pecuniary loss that is filed on or after the 4-17 effective date of this Act. An application for benefits or claim 4-18 for pecuniary loss that is filed before the effective date of this 4-19 Act is governed by the law in effect when the application for 4-20 benefits or claim for pecuniary loss was filed, and that law is 4-21 continued in effect for that purpose. 4-22 SECTION 5. The importance of this legislation and the 4-23 crowded condition of the calendars in both houses create an 4-24 emergency and an imperative public necessity that the 4-25 constitutional rule requiring bills to be read on three several 4-26 days in each house be suspended, and this rule is hereby suspended, 4-27 and that this Act take effect and be in force from and after its 4-28 passage, and it is so enacted. 4-29 * * * * * 4-30 Austin, 4-31 Texas 4-32 March 19, 1993 4-33 Hon. Bob Bullock 4-34 President of the Senate 4-35 Sir: 4-36 We, your Committee on Health and Human Services to which was 4-37 referred S.B. No. 209, have had the same under consideration, and I 4-38 am instructed to report it back to the Senate with the 4-39 recommendation that it do not pass, but that the Committee 4-40 Substitute adopted in lieu thereof do pass and be printed. 4-41 Zaffirini, 4-42 Chair 4-43 * * * * * 4-44 WITNESSES 4-45 FOR AGAINST ON 4-46 ___________________________________________________________________ 4-47 Name: Dan Morales x 4-48 Representing: State of Texas 4-49 City: Austin 4-50 ------------------------------------------------------------------- 4-51 Name: Dr. Charles Arnold x 4-52 Representing: Self 4-53 City: San Antonio 4-54 ------------------------------------------------------------------- 4-55 Name: David F. Briones, M.D. x 4-56 Representing: TSPP & TMA 4-57 City: El Paso 4-58 ------------------------------------------------------------------- 4-59 Name: Ben Marroquin x 4-60 Representing: MHMR 4-61 City: Austin 4-62 ------------------------------------------------------------------- 4-63 Name: Mina Epps x 4-64 Representing: A.G.'s office 4-65 City: Austin 4-66 ------------------------------------------------------------------- 4-67 FOR AGAINST ON 4-68 ___________________________________________________________________ 4-69 Name: Richard H. Anderson x 4-70 Representing: A.G.'s office 5-1 City: Austin 5-2 ------------------------------------------------------------------- 5-3 Name: Don Cavness x 5-4 Representing: Tx Psychological Asson. 5-5 City: Austin 5-6 ------------------------------------------------------------------- 5-7 Name: Nancy Sims x 5-8 Representing: Tx Business Group on Health 5-9 City: Houston 5-10 ------------------------------------------------------------------- 5-11 Name: Marcia Baum x 5-12 Representing: NASW 5-13 City: Austin 5-14 ------------------------------------------------------------------- 5-15 Name: Christine Devall x 5-16 Representing: Mental Health Assn 5-17 City: Austin 5-18 ------------------------------------------------------------------- 5-19 Name: Kevin O'Hanlon x 5-20 Representing: TEA 5-21 City: Austin 5-22 ------------------------------------------------------------------- 5-23 Name: Lisa McGiffert x 5-24 Representing: Consumers Union 5-25 City: Austin 5-26 -------------------------------------------------------------------