BILL ANALYSIS


                                                         H.B. 867
                                              By: Maxey (Sponsor)
                                        Health and Human Services
                                                          5-11-95
                              Senate Committee Report (Unamended)
BACKGROUND

The federal Health Care Financing Administration, which oversees
all Medicaid programs, has encouraged states to upgrade
reimbursement systems and has made grants available to facilitate
this process.

PURPOSE

As proposed, H.B. 867 requires the Texas Department of Human
Services to develop an automated system for providing
reimbursements to nursing homes under the state Medicaid program.

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is granted
to the Texas Department of Human Services under SECTION 1 (Section
242.205, Health and Safety Code) of this bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 242, Health and Safety Code, by adding
Subchapter H, as follows:

 SUBCHAPTER H. AUTOMATED MEDICAID PATIENT CARE AND REIMBURSEMENT SYSTEM

     Sec. 242.201.  AUTOMATED SYSTEM FOR MEDICAID PATIENT CARE AND
     REIMBURSEMENT.  (a) Requires the Texas Department of Human
     Services (department) to acquire and develop an automated
     system for providing reimbursements to nursing homes under the
     state Medicaid program (automated system), subject to the
     availability of funds appropriated for that purpose.
     
     (b) Requires the department to select an automated system
       that will allow the addition of other components of the
       state Medicaid program.
       
       (c) Requires the department and the Health and Human
       Services Commission (commission) to work together to apply
       for all available federal funds to help pay for the
       automated system.
       
       (d) Requires the department to assist nursing homes to make
       systems compatible with the automated system selected by the
       department.
       
       Sec. 242.202.  DATA USED BY SYSTEM.  Requires the automated
     system to use a form designed by the U.S. Health Care
     Financing Administration for nursing home use.
     
     Sec. 242.203.  ELECTRONIC CLAIMS FOR REIMBURSEMENT.  (a)
     Requires the automated system to be able to link the
     department electronically with nursing homes making claims for
     reimbursement.  Requires each nursing home to make claims
     electronically.
     
     (b) Requires the department to charge a fee, in an amount
       necessary to cover the costs of manually processing the
       claims, to nursing homes that do not make their claims for
       reimbursement electronically.
       
       Sec. 242.204.  DATE OF REIMBURSEMENT.  Requires the department
     to pay the nursing home reimbursement claims under the state
     Medicaid program that are made electronically not later than
     the 30th day after the date the claim is made.
     
     Sec. 242.205.  RULES.  Requires the department to adopt rules
     and make policy changes as necessary to improve the efficiency
     of the reimbursement process and to maximize the automated
     system's capabilities.
     
     SECTION 2.     (a) Requires the department to implement the nursing
home reimbursement component of the automated system not later than
January 1, 1997.  Requires the commission to evaluate and determine
deadlines for using the system for other components of the state
Medicaid program and to work with health and human services
agencies to allocate costs.

     (b) Requires the department to reduce staff and purchases as
     savings and efficiency from implementing the automated
     reimbursement system are realized.
     
     SECTION 3.     Emergency clause.
           Effective date: upon passage.