BILL ANALYSIS


                                                    C.S.H.B. 2377
                                           By: Delisi (Zaffirini)
                                        Health and Human Services
                                                         05-22-95
                            Senate Committee Report (Substituted)
BACKGROUND

New roles and changes in the service delivery system, including the
recent designation of the Texas Department of Mental Health and
Mental Retardation (TXMHMR) as a Medicaid operating agency,
expansion of the mental health and mental retardation provider base
beyond TXMHMR and community centers, point to the need for clear
articulation of the role of a mental health and mental retardation
authority and a clear delineation of the differences between the
authority role and the more traditional role of provider.

To address these issues, in January 1994, the chair of TXMHMR board
appointed a "blue ribbon" task force charged with exploring issues
related to organizing, financing, and delivering mental health and
mental retardation services and making recommendations to the
commissioner and the board about future directions and needed
changes.

PURPOSE

As proposed, C.S.H.B. 2377 sets forth provisions clarifying the
role of the mental health and mental retardation authority in its
administration and coordination of mental health and mental
retardation services.

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is granted
to the board of the Texas Department of Mental Health and Mental
Retardation under SECTION 10 (Sec. 533.087, Chapter 533D, Health
and Safety Code) and in SECTION 17 (Sec. 551.022(d), Health and
Safety Code) of this bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 531.001, Health and Safety Code, by
amending Subsections (a), (b), and (e), and adding Subsection (h),
as follows:

     (a)  Provides that it is the purpose of this subtitle to
     provide for the effective administration and coordination of
     mental health and mental retardation services (mental
     services) at the state and local levels.
     
     (b)  Provides that it is the purpose of this subtitle to
     ensure that a continuum of services is provided, recognizing
     that a variety of alternatives for serving the mentally
     disabled exists.
     
     (e)  Requires the Texas Department of Mental Health and Mental
     Retardation (department) to provide technical assistance for
     and regulation of the programs that receive funding through
     contracts with the department.  Makes a conforming change.
     
     (h)  Provides that it is the policy of this state that the
     board of the Texas Department of Mental Health and Mental
     Retardation (board) serves as the state's mental health and
     mental retardation authority and is responsible for the
     planning, policy development, and resource development and
     allocation for and oversight of mental services in this state. 
     Provides that it is state policy that the board may delegate
     the board's authority to a single entity in each region of the
     state that may function as the local mental health or mental
     retardation authority for one or more service areas in the
     region, when appropriate and feasible.
     
     SECTION 2.     Amends Sections 531.002(8) and (9), Health and Safety
Code, to redefine "local mental health authority" and "local mental
retardation authority."

SECTION 3. Amends Section 532.001(a), Health and Safety Code, to
delete a requirement that a medical director and deputy
commissioners serve on the board of the department.

SECTION 4. Amends Section 532.003(b), Health and Safety Code, as
follows:

     (b)  Requires members to be representatives of the public who
     have demonstrated interest in mental health, mental
     retardation, developmental disabilities, or the health and
     human services system.
     
     SECTION 5.     Amends Sections 532.011(e) and (g), Health and Safety
Code, to provide that the commissioner is responsible for
implementation of the board's planning, policy, resource
development and allocation, and oversight related to mental
services.  Makes a conforming change.

SECTION 6. Amends Sections 532.012(a) and (c), Health and Safety
Code, as follows:

     (a)  Makes a conforming change.
     
     (c)  Provides that the medical director reports to the
     commissioner and is responsible for oversight of the quality
     and appropriateness of clinical services delivered in
     department facilities or under contract to the department; and
     leadership in physician recruitment and retention and peer
     review.
     
SECTION 7. Amend Section 532.014(a), Health and Safety Code, to
make a conforming change.

SECTION 8. Amends Sections 533.035(a)-(c), Health and Safety Code,
as follows:

     (a)  Requires the commissioner to designate a local mental
     health authority and a local mental retardation authority in
     one or more local service areas.  Authorizes the board to
     delegate to the local authorities the board's authority and
     responsibility for the planning, policy development,
     coordination, resource allocation, and resource development
     for and oversight of services.  Authorizes the commissioner to
     designate a single entity as the mental health authority and
     the mental retardation authority for a service area.
     
     (b)  Deletes department federal mental health funds from the
     funds the department may disburse to a local mental health and
     mental retardation authority.
     
     (c)  Requires the local authority to consider public input,
     ultimate cost-benefit, and client care issues to ensure
     consumer choice and the best use of public money in assembling
     a network of service providers and determining whether to
     become a provider of a service or to contract that service to
     another organization.
     
SECTION 9. Amends Chapter 533B, Health and Safety Code, by adding
Section 533.0355, as follows:

     Sec. 533.0355.  AUTHORITY STRUCTURE PILOT PROJECT.  (a) 
     Authorizes the board to implement a pilot project to study an
     authority structure for service delivery at the local or
     regional level through a pilot local mental health or mental
     retardation authority.  Requires the project to provide an
     organizational separation between the pilot local mental
     health or mental retardation authority and service providers. 
     Authorizes the board to delegate to a pilot local mental
     health or mental retardation authority the responsibility for
     the distribution, allocation, and coordination of mental
     health and mental retardation service resources in one or more
     service areas.
     
     (b)  Authorizes the board to establish one or more pilot
       local mental health and mental retardation authorities under
       this section.
       
       (c)  Requires the department to evaluate the pilot project,
       prepare a report on the success of the pilot project, and
       submit the report to the 75th and 76th legislatures on
       January 15, 1997, and January 15, 1999, respectively.
       
       (d)  Provides that this section expires September 1, 1999.
       
       SECTION 10.  Amends Chapter 533D, Health and Safety Code, by
adding Section 533.087, as follows:

     Sec. 533.087.  LEASE OF REAL PROPERTY.  (a)  Authorizes the
     department to lease real property regardless of whether the
     property is surplus property.  Authorizes the department to
     award a lease of real property only at the prevailing market
     rate and by competitive bid, except as provided by Subsection
     (c).
     
     (b)  Requires the department to advertise a proposal for
       lease at least once a week for four consecutive weeks in
       certain newspapers.
       
       (c)  Sets forth certain conditions under which the
       department may lease real property or an improvement for
       less than the prevailing market rate, without advertisement
       or competitive bidding.
       
       (d)  Requires the board to adopt leasing rules, forms, and
       contracts that will protect the state's interests.
       
       (e)  Authorizes the board to reject any bid.
       
       (f)  Provides that this section does not authorize the
       department to close or consolidate a facility used to
       provide mental services without legislative approval.
       
       SECTION 11.  Amends Section 534.022, Health and Safety Code, by
adding Subsection (e), as follows:

          (e)  Authorizes a county or municipality acting alone or two
     or more counties or municipalities acting jointly pursuant to
     interlocal contract to create a public facility corporation to
     act on behalf of one or more community centers pursuant to
     Article 717s, V.T.C.S. (Public Facility Corporation Act). 
     Authorizes such counties or municipalities to exercise the
     powers of a sponsor under the Act, and any such corporation to
     exercise the powers of a corporation under the Act. 
     Authorizes the corporation to exercise its powers on behalf of
     community centers in such manner as may be prescribed that in
     no event shall one community center ever be liable to pay the
     debts or obligation or be liable for the acts, actions, or
     undertakings of another community center.
     
     SECTION 12.    Amends Sections 534.054(a) and (d), Health and
Safety Code, make conforming changes.

SECTION 13.    Amends Sections 534.055(d) and (e), Health and
Safety Code, as follows:

     (d)  Deletes a provision prohibiting a mental health or mental
     retardation authority from requiring competitive bidding on
     the renewal of a contract.
     
     (e)  Provides that the system must require that each mental
     health or mental retardation authority ensure public
     participation in the authority's decisions regarding whether
     to provide or to contract for a service, among other
     requirements.  Makes nonsubstantive changes.
     
     SECTION 14.    Amends Section 534.064, Health and Safety Code, to
make a conforming change.

SECTION 15.    Amends Section 534.065(b), Health and Safety Code,
to require the mental health or mental retardation authority to
renew the contract if the authority finds that, among certain
information, the provider is providing a reasonably adequate level
of service in accordance with the contract and at a reasonable
cost.

SECTION 16.    Amends Section 534.066(b), Health and Safety Code,
to make conforming changes.

SECTION 17.    Amends Sections 551.022(c) and (d), Health and
Safety Code, as follows:

     (c)  Requires the superintendent to oversee the admission and
     discharge of patient and client, among other duties.  Makes a
     conforming change.
     
     (d)  Authorizes the superintendent, among other actions, to
     establish policy to govern the facility that the
     superintendent considers will best promote the patients' and
     clients' interest and welfare, in accordance with board rules
     and departmental operating procedures.
     
     SECTION 18.    Repealer:  Sections 532.013, 533.064, 534.062,
551.021, and 551.023, Health and Safety Code (Deputy Commissioners
- Memorandum of Understanding on ICF-MR Services - Review of Crisis
Residential and Hospitalization Services - Qualifications of
Certain Superintendents - Reports from Superintendent).

SECTION 19.    Makes application of this Act prospective.

SECTION 20.    Provides that nothing in this Act authorizes the
department to privatize the administration of state facilities.

SECTION 21.    Effective date: September 1, 1995.

SECTION 22.    Emergency clause.