1-1 By: Hilderbran (Senate Sponsor - Patterson) H.B. No. 2644
1-2 (In the Senate - Received from the House May 12, 1995;
1-3 May 16, 1995, read first time and referred to Committee on Health
1-4 and Human Services; May 24, 1995, reported adversely, with
1-5 favorable Committee Substitute by the following vote: Yeas 5, Nays
1-6 0; May 24, 1995, sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR H.B. No. 2644 By: Patterson
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to licensing and Medicaid certification requirements for
1-11 certain nursing facilities and related penalties and dispute
1-12 resolution.
1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-14 SECTION 1. Section 32.021, Human Resources Code, is amended
1-15 by amending Subsection (d) and adding Subsections (h), (i), (j),
1-16 and (k) to read as follows:
1-17 (d) The department may include in its contracts for the
1-18 delivery of medical assistance by nursing facilities provisions for
1-19 monetary penalties to be assessed for contract violations as
1-20 required by 42 U.S.C. Section 1396r, including without limitation
1-21 the Omnibus Budget Reconciliation Act (OBRA), P.L. 100-203, Nursing
1-22 Home Reform Amendments of 1987, provided that the department:
1-23 (1) establish a penalties and sanctions advisory
1-24 committee of consumer advocates and long-term care providers to
1-25 help develop and monitor an appropriate system for assessing
1-26 penalties; and
1-27 (2) develop rules in accordance with Subsection (i)<,
1-28 including an administrative appeals process> to adjudicate claims
1-29 in contested cases<, in accordance with the Administrative
1-30 Procedure and Texas Register Act (Article 6252-13a, Vernon's Texas
1-31 Civil Statutes)>.
1-32 (h) Except to the extent necessary to implement rights
1-33 granted to an elderly individual under Chapter 102, the rules
1-34 adopted by the department for certification of nursing facilities
1-35 as being in compliance with the requirements for participation in
1-36 the state Medicaid program may not be different from the standards
1-37 imposed by federal law. This subsection does not prevent the
1-38 department from using any civil, administrative, or criminal remedy
1-39 authorized by state or federal law with respect to a facility that
1-40 is in violation of a certification or licensing requirement.
1-41 (i) The rules adopted under Subsection (d)(2) must provide
1-42 for:
1-43 (1) an informal dispute resolution process that
1-44 provides for adjudication by an appropriate disinterested person in
1-45 a regional office of the department and an informal appeal to the
1-46 department's central office;
1-47 (2) an administrative appeals process under Chapter
1-48 2001, Government Code; and
1-49 (3) the arbitration process described by Subsection
1-50 (k).
1-51 (j) A finding by the department that an institution has
1-52 violated a standard for participation in the state Medicaid
1-53 program, or the assessment or payment of a monetary penalty under
1-54 this section, is not admissible as evidence in a civil action to
1-55 prove that the institution has committed a violation. This
1-56 subsection does not apply in an enforcement action or related
1-57 proceeding in which the state or an agency or political subdivision
1-58 of the state is a party.
1-59 (k) An assessment of monetary penalties under this section
1-60 is subject to arbitration under Subchapter H, Chapter 242, Health
1-61 and Safety Code.
1-62 SECTION 2. Section 242.037, Health and Safety Code, is
1-63 amended to read as follows:
1-64 Sec. 242.037. MINIMUM STANDARDS. (a) The board may adopt,
1-65 publish, and enforce minimum standards relating to:
1-66 (1) the construction of an institution, including
1-67 plumbing, heating, lighting, ventilation, and other housing
1-68 conditions, to ensure the residents' health, safety, comfort, and
2-1 protection from fire hazard;
2-2 (2) the regulation of the number and qualification of
2-3 all personnel, including management and nursing personnel,
2-4 responsible for any part of the care given to the residents;
2-5 (3) requirements for in-service education of all
2-6 employees who have any contact with the residents;
2-7 (4) training on the care of persons with Alzheimer's
2-8 disease and related disorders for employees who work with those
2-9 persons;
2-10 (5) sanitary and related conditions in an institution
2-11 and its surroundings, including water supply, sewage disposal, food
2-12 handling, and general hygiene in order to ensure the residents'
2-13 health, safety, and comfort;
2-14 (6) the dietary needs of each resident according to
2-15 good nutritional practice or the recommendations of the physician
2-16 attending the resident;
2-17 (7) equipment essential to the residents' health and
2-18 welfare; and
2-19 (8) the use and administration of medication in
2-20 conformity with applicable law and rules.
2-21 (b) Notwithstanding Section 222.0255(b), an institution that
2-22 is certified as being in compliance with each standard of
2-23 participation in the state Medicaid program that relates to the
2-24 same subject matter as a minimum standard established under
2-25 Subsection (a) is not required to satisfy the minimum standard
2-26 established under that subsection.
2-27 SECTION 3. Section 242.069, Health and Safety Code, is
2-28 amended by adding Subsection (g) to read as follows:
2-29 (g) A penalty collected under this section shall be
2-30 deposited to the credit of the nursing and convalescent home trust
2-31 fund established under Section 242.096.
2-32 SECTION 4. Subchapter C, Chapter 242, Health and Safety
2-33 Code, is amended by adding Section 242.070 to read as follows:
2-34 Sec. 242.070. APPLICATION OF OTHER LAW. The department may
2-35 not assess a penalty under both this subchapter and Section 32.021,
2-36 Human Resources Code, for a violation arising out of the same act
2-37 or failure to act.
2-38 SECTION 5. Chapter 242, Health and Safety Code, is amended
2-39 by adding Subchapter H to read as follows:
2-40 SUBCHAPTER H. ARBITRATION OF CERTAIN DISPUTES
2-41 Sec. 242.251. SCOPE OF SUBCHAPTER. This subchapter applies
2-42 to any dispute between an institution licensed under this chapter
2-43 and the department relating to:
2-44 (1) renewal of a license under Section 242.033;
2-45 (2) suspension or revocation of a license under
2-46 Section 242.061;
2-47 (3) assessment of a civil penalty under Section
2-48 242.065;
2-49 (4) assessment of a monetary penalty under Section
2-50 242.066; or
2-51 (5) assessment of a penalty as described by Section
2-52 32.021(k), Human Resources Code.
2-53 Sec. 242.252. ELECTION OF ARBITRATION. (a) An affected
2-54 institution may elect binding arbitration of any dispute to which
2-55 this subchapter applies. Arbitration under this subchapter is an
2-56 alternative to a contested case hearing or to a judicial proceeding
2-57 relating to the assessment of a civil penalty.
2-58 (b) An affected institution may elect arbitration under this
2-59 subchapter by filing the election with the department not later
2-60 than the 10th day after a notice of hearing relating to any dispute
2-61 described by Section 242.251 is received by the institution.
2-62 (c) The department may elect arbitration under this
2-63 subchapter by notifying the institution of the election not later
2-64 than the date that the institution may elect arbitration under
2-65 Subsection (b).
2-66 (d) An election to engage in arbitration under this
2-67 subchapter is irrevocable and binding on the institution and the
2-68 department.
2-69 Sec. 242.253. ARBITRATION PROCEDURES. (a) The arbitration
2-70 shall be conducted by an arbitrator.
3-1 (b) The arbitration and the appointment of the arbitrator
3-2 shall be conducted in accordance with rules adopted by the chief
3-3 administrative law judge of the State Office of Administrative
3-4 Hearings. Before adopting rules under this subsection, the chief
3-5 administrative law judge shall consult with the department and
3-6 shall consider appropriate rules developed by any nationally
3-7 recognized association that performs arbitration services.
3-8 (c) The department shall pay the cost of the arbitration if
3-9 the department elects the arbitration. The cost of the arbitration
3-10 shall be shared equally by the department and the institution if
3-11 the institution elects the arbitration. The total fees and
3-12 expenses paid for an arbitrator for a day may not exceed $500.
3-13 (d) The State Office of Administrative Hearings may
3-14 designate a nationally recognized association that performs
3-15 arbitration services to conduct arbitrations under this subchapter
3-16 and may, after consultation with the department, contract with that
3-17 association for the arbitrations.
3-18 Sec. 242.254. ARBITRATOR; QUALIFICATIONS. Each arbitrator
3-19 must be on an approved list of a nationally recognized association
3-20 that performs arbitration services or be otherwise qualified as
3-21 provided in the rules adopted under Section 242.253(b).
3-22 Sec. 242.255. ARBITRATOR; SELECTION. The arbitrator shall
3-23 be appointed in accordance with the rules adopted under Section
3-24 242.253(b).
3-25 Sec. 242.256. DUTIES OF ARBITRATOR. The arbitrator shall:
3-26 (1) protect the interests of the department and the
3-27 institution;
3-28 (2) ensure that all relevant evidence has been
3-29 disclosed to the arbitrator, department, and institution; and
3-30 (3) render an order consistent with this chapter and
3-31 the rules adopted under this chapter.
3-32 Sec. 242.257. SCHEDULING OF ARBITRATION. (a) The
3-33 arbitrator conducting the arbitration shall schedule arbitration to
3-34 be held not later than the 90th day after the date the arbitrator
3-35 is selected and shall notify the department and the institution of
3-36 the scheduled date.
3-37 (b) The arbitrator may grant a continuance of the
3-38 arbitration at the request of the department or institution. The
3-39 arbitrator may not unreasonably deny a request for a continuance.
3-40 Sec. 242.258. EXCHANGE AND FILING OF INFORMATION. Not later
3-41 than the seventh day before the first day of arbitration, the
3-42 department and the institution shall exchange and file with the
3-43 arbitrator:
3-44 (1) all documentary evidence not previously exchanged
3-45 and filed that is relevant to the dispute; and
3-46 (2) information relating to a proposed resolution of
3-47 the dispute.
3-48 Sec. 242.259. ATTENDANCE REQUIRED. (a) The arbitrator may
3-49 proceed in the absence of any party or representative of a party
3-50 who, after notice of the proceeding, fails to be present or to
3-51 obtain a postponement.
3-52 (b) An arbitrator may not make an order solely on the
3-53 default of a party and shall require the party who is present to
3-54 submit evidence, as required by the arbitrator, before making an
3-55 award.
3-56 Sec. 242.260. TESTIMONY; RECORD. (a) The arbitrator may
3-57 require witnesses to testify under oath and shall require testimony
3-58 under oath if requested by the department or the institution.
3-59 (b) The department shall make an electronic recording of the
3-60 proceeding.
3-61 (c) An official stenographic record of the proceeding is not
3-62 required, but the department or the institution may make a
3-63 stenographic record. The party that makes the stenographic record
3-64 shall pay the expense of having the record made.
3-65 Sec. 242.261. EVIDENCE. (a) The department or the
3-66 institution may offer evidence as they desire and shall produce
3-67 additional evidence as the arbitrator considers necessary to
3-68 understand and resolve the dispute.
3-69 (b) The arbitrator is the judge of the relevance and
3-70 materiality of the evidence offered. Strict conformity to rules
4-1 applicable to judicial proceedings is not required.
4-2 Sec. 242.262. CLOSING STATEMENTS; BRIEFS. The department
4-3 and the institution may present closing statements as they desire,
4-4 but the record may not remain open for written briefs unless
4-5 requested by the arbitrator.
4-6 Sec. 242.263. EX PARTE CONTACTS PROHIBITED. (a) Except as
4-7 provided by Subsection (b), the department and the institution may
4-8 not communicate with an arbitrator other than at an oral hearing
4-9 unless the parties and the arbitrator agree otherwise.
4-10 (b) Any oral or written communication, other than a
4-11 communication authorized under Subsection (a), from the parties to
4-12 an arbitrator shall be directed to the association that is
4-13 conducting the arbitration or, if there is no association
4-14 conducting the arbitration, to the State Office of Administrative
4-15 Hearings, for transmittal to the arbitrator.
4-16 Sec. 242.264. ORDER. (a) The arbitrator may enter any
4-17 order that may be entered by the department, board, commissioner,
4-18 or court under this chapter in relation to a dispute described by
4-19 Section 242.251.
4-20 (b) The arbitrator shall enter the order not later than the
4-21 60th day after the last day of the arbitration.
4-22 (c) The arbitrator shall base the order on the facts
4-23 established at arbitration, including stipulations of the parties,
4-24 and on the law as properly applied to those facts.
4-25 (d) The order must:
4-26 (1) be in writing;
4-27 (2) be signed and dated by the arbitrator; and
4-28 (3) include a statement of the arbitrator's decision
4-29 on the contested issues and the department's and institution's
4-30 stipulations on uncontested issues.
4-31 (e) The arbitrator shall file a copy of the order with the
4-32 department and shall notify the department and the institution in
4-33 writing of the decision.
4-34 Sec. 242.265. EFFECT OF ORDER. An order of an arbitrator
4-35 under this subchapter is final and binding on all parties. Except
4-36 as provided by Section 242.267, there is no right to appeal.
4-37 Sec. 242.266. CLERICAL ERROR. For the purpose of correcting
4-38 a clerical error, an arbitrator retains jurisdiction of the award
4-39 for 20 days after the date of the award.
4-40 Sec. 242.267. COURT VACATING ORDER. (a) On application of
4-41 the institution, a court shall vacate an arbitrator's order with
4-42 respect to an arbitration conducted at the election of the
4-43 department on a finding that:
4-44 (1) the order was procured by corruption, fraud, or
4-45 misrepresentation;
4-46 (2) the decision of the arbitrator was arbitrary or
4-47 capricious and against the weight of the evidence; or
4-48 (3) the order exceeded the jurisdiction of the
4-49 arbitrator under Section 242.264(a).
4-50 (b) If the order is vacated, the dispute shall be remanded
4-51 to the department for another arbitration proceeding.
4-52 (c) A suit to vacate an arbitrator's order must be filed not
4-53 later than the 30th day after:
4-54 (1) the date of the award; or
4-55 (2) the date the institution knew or should have known
4-56 of a basis for suit under this section, but in no event later than
4-57 the first anniversary of the date of the order.
4-58 (d) Venue for a suit to vacate an arbitrator's order is in
4-59 the county in which the arbitration was conducted.
4-60 Sec. 242.268. NO ARBITRATION OF EMERGENCY ORDER OR CLOSING
4-61 ORDER. This subchapter does not apply to an order issued under
4-62 Section 242.062.
4-63 SECTION 6. (a) This Act takes effect September 1, 1995.
4-64 (b) Subchapter H, Chapter 242, Health and Safety Code, as
4-65 added by this Act, applies only to a dispute described by Section
4-66 242.251, Health and Safety Code, as added by this Act, with respect
4-67 to which formal proceedings are commenced on or after January 1,
4-68 1996.
4-69 SECTION 7. The importance of this legislation and the
4-70 crowded condition of the calendars in both houses create an
5-1 emergency and an imperative public necessity that the
5-2 constitutional rule requiring bills to be read on three several
5-3 days in each house be suspended, and this rule is hereby suspended.
5-4 * * * * *