BILL ANALYSIS
C.S.S.B. 1596
By: Leedom
Health and Human Services
4-28-95
Committee Report (Substituted)
BACKGROUND
Currently, there are two forums for convalescent or nursing homes
to appeal punitive actions taken by the Department of Human
Services: informal reconsideration and formal administrative
appeals.
In informal reconsiderations, regional directors from the
department make the final decisions regarding determinations,
penalties, and sanctions. These are the same individuals who make
decisions leading to the informal reconsideration request. Formal
administrative appeals are held at the department in front of
administrative law judges who are employed by the department.
Neither of these venues is conducive to impartial or objective
proceedings, and lead to a major area of concern that there exists
no due process for the purpose of administratively resolving
deficiency or penalty issues.
PURPOSE
As proposed, C.S.S.B. 1596 authorizes the election of binding
arbitration of certain disputes between the Texas Department of
Health and health-care institutions licensed under Chapter 242,
Health and Safety Code.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Chapter 242, Health and Safety Code, by adding
Subchapter H, as follows:
SUBCHAPTER H. ARBITRATION OF CERTAIN DISPUTES
Sec. 242.251. SCOPE OF SUBCHAPTER. Provides that this
subchapter applies to any dispute, between an institution
licensed under this chapter and the Texas Department of Human
Services (department), relating to renewal of a license under
Section 242.033, suspension or revocation of a license or
closing of a facility under Section 242.061 or 242.062,
assessment of a civil penalty under Section 242.066, or
assessment of an administrative penalty under Section 242.066.
Sec. 242.252. ELECTION OF ARBITRATION. (a) Authorizes an
affected institution to elect binding arbitration, as an
alternative to a contested case hearing or a judicial
proceeding relating to the assessment of a civil penalty, of
any dispute to which this subchapter applies.
(b) Authorizes an affected institution to elect arbitration
by filing the election with the department not later than
the 10th day after a notice of hearing relating to any
dispute under Subsection 242.251 is received by the
institution.
(c) Makes an election to engage in arbitration irrevocable
and binding.
Sec. 242.253. ARBITRATION PROCEDURES. (a) Requires the
arbitration to be conducted by the American Arbitration
Association or another nationally recognized association that
performs arbitration services.
(b) Requires the arbitration to be conducted in accordance
with the American Arbitration Association's commercial
arbitration rules in effect November 1, 1993.
(c) Requires the cost of the arbitration to be shared
equally by the department and the institution electing
arbitration.
Sec. 242.254. ARBITRATOR; QUALIFICATIONS. Requires the
arbitrator to be on an approved list of the American
Arbitration Association or another nationally recognized
association that performs arbitration services.
Sec. 242.255. ARBITRATOR; SELECTION. Requires the
arbitration to be conducted by one arbitrator appointed from
a panel of arbitrators provided by the American Arbitration
Association or another nationally recognized association that
performs arbitration services. Requires the appointment to be
made in accordance with the American Arbitration Association's
commercial arbitration rules in effect November 1, 1993.
Sec. 242.256. DUTIES OF ARBITRATOR. Requires the arbitrator
to protect the interests of the department and institution;
ensure that all relevant evidence has been disclosed to the
arbitrator, department, and institution; and render an order
consistent with this chapter and rules adopted under this
chapter.
Sec. 242.257. SCHEDULING OF ARBITRATION. (a) Requires the
association conducting the arbitration to schedule arbitration
within a certain time period and to notify the department and
institution of the scheduled date.
(b) Authorizes the arbitrator to grant a continuance of the
arbitration, and prohibits the arbitrator from unreasonably
denying a department or institution request for continuance.
Sec. 242.258. EXCHANGE AND FILING OF INFORMATION. Requires
the department and institution to exchange and file with the
arbitrator certain information.
Sec. 242.259. ATTENDANCE REQUIRED. (a) Authorizes the
arbitrator to proceed in the absence of any party who, after
notice of the proceeding, fails to be present or to obtain a
postponement.
(b) Prohibits an arbitrator from making an order solely on
the default of a party, and requires the arbitrator to
require the party who is present to submit evidence, as
required by the arbitrator, before making an award.
Sec. 242.260. TESTIMONY; RECORD. (a) Authorizes the
arbitrator to require witnesses to testify under oath, and
requires the arbitrator to require such testimony if requested
by the department or institution.
(b) Requires the department to make an electronic recording
of the proceeding.
(c) Authorizes the department or institution to make a
stenographic record of the proceeding.
Sec. 242.261. EVIDENCE. (a) Authorizes the department or
institution to offer evidence as they desire, and requires
them to produce additional evidence necessary to understand
and resolve the dispute.
(b) Makes the arbitrator the judge of the relevance and
materiability of the evidence offered. Provides that strict
conformity to rules applicable to judicial proceedings is
not required.
Sec. 242.262. CLOSING STATEMENTS; BRIEFS. Authorizes the
department and institution to present closing statements as
they desire, but prohibits the records from remaining open for
written briefs unless requested by the arbitrator.
Sec. 242.263. EX PARTE CONTACTS PROHIBITED. (a) Prohibits
the department and institution, except as provided by
Subsection (b), from communicating with the arbitrator other
than at an oral hearing, unless the parties and the arbitrator
agree otherwise.
(b) Requires any oral or written communication, other than
under Subsection (A), from the parties to the arbitrator to
be directed to the association conducting the arbitration
for transmittal to the arbitrator.
Sec. 242.264. ORDER. (a) Authorizes the arbitrator to enter
any order that may be entered by the department, board,
commissioner, or court under this chapter in relation to a
dispute under Section 242.251.
(b) Requires the arbitrator to enter the order not later
than the 60th day after the last day of the arbitration.
(c) Requires the arbitrator to base the order on the facts
established at arbitration and on the law as properly
applied to those facts.
(d) Sets forth requirements for the order.
(e) Requires the arbitrator to file a copy of the order with
the department and to notify the department and institution
in writing of the decision.
Sec. 242.265. EFFECT OF ORDER. Makes an order under this
subchapter final and binding, and provides that, except as
provided by Section 242.267, there is no right to appeal.
Sec. 242.266. CLERICAL ERROR. Provides that the arbitrator,
for the purpose of correcting a clerical error, retains
jurisdiction of the award for 20 days after the date of the
award.
Sec. 242.267. COURT VACATING ORDER. (a) Requires a court, on
application of the department or institution, to vacate an
arbitrator's order under certain conditions.
(b) Requires the dispute, if the order is vacated, to be
remanded to the department for another arbitration
proceeding.
(c) Requires a suit to vacate an arbitrator's order to be
filed by a certain date.
(d) Places venue for a suit to vacate an arbitrator's order
in the county where the arbitration was conducted.
Sec. 242.268. EMERGENCY ORDER OR CLOSING ORDER NOT STAYED.
Provides that an order issued under Section 242.062 is not
stayed, pending an arbitration under this subchapter.
SECTION 2. Effective date: September 1, 1995.
Makes application of this Act prospective beginning
January 1, 1996.
SECTION 3. Emergency clause.