1-1 By: Nelson, et al. S.B. No. 604 1-2 (In the Senate - Filed February 16, 1995; February 16, 1995, 1-3 read first time and referred to Committee on Health and Human 1-4 Services; March 16, 1995, reported adversely, with favorable 1-5 Committee Substitute by the following vote: Yeas 9, Nays 0; 1-6 March 16, 1995, sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 604 By: Nelson 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to a pilot program for the establishment of medical 1-11 savings accounts to assist Medicaid recipients. 1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-13 SECTION 1. MEDICAID MEDICAL SAVINGS ACCOUNT PILOT PROGRAM. 1-14 (a) Not later than December 1, 1995, the Health and Human Services 1-15 Commission shall develop a plan for a pilot program that uses 1-16 Medicaid funds to establish medical savings accounts for recipients 1-17 of acute care services under the state Medicaid program. 1-18 (b) The goals of the pilot program are to: 1-19 (1) create patient awareness of the high cost of 1-20 medical care; 1-21 (2) provide incentives to patients to seek preventive 1-22 and primary care services; 1-23 (3) reduce inappropriate use of health care services; 1-24 and 1-25 (4) enable clients to take responsibility for healthy 1-26 outcomes. 1-27 (c) The commission may examine each available medical 1-28 savings account model to determine if the model can be used in this 1-29 state. 1-30 (d) In developing the pilot program, the commission may 1-31 provide that: 1-32 (1) providers receive payment at a negotiated rate for 1-33 each patient; 1-34 (2) the savings realized by the pilot program are 1-35 shared by the provider, client, and this state; 1-36 (3) the client's share of the savings is placed in a 1-37 savings pool and credited to an individual medical savings account 1-38 established by the provider for that client, provided that certain 1-39 health maintenance standards are met; 1-40 (4) copayments and deductibles for inappropriate use 1-41 of health care are paid by deducting an amount prescribed by the 1-42 commission from the client's individual medical savings account; 1-43 and 1-44 (5) bonus deposits are credited to a client's 1-45 individual medical savings account for achieving health maintenance 1-46 standards prescribed by the commission. 1-47 (e) The commission shall: 1-48 (1) determine the size and location of each pilot 1-49 program; 1-50 (2) include urban and rural counties in determining 1-51 location; 1-52 (3) develop health maintenance standards for each life 1-53 cycle for use in determining if money should be credited to or 1-54 deducted from an individual medical savings account; 1-55 (4) determine the amount of each bonus payment and 1-56 deduction from an individual medical savings account; 1-57 (5) determine the appropriate method, other than a 1-58 cash payment, for releasing to a client money in an individual 1-59 medical savings account when the person no longer participates in 1-60 the Medicaid program; 1-61 (6) exclude medical savings account funds in 1-62 determining income, assets, or resources for purposes of 1-63 eligibility for a public benefits program in this state, regardless 1-64 of whether the funds are used by the household; and 1-65 (7) design the program so that the state controls the 1-66 costs associated with the Medicaid program and, to the extent 1-67 possible, saves money. 1-68 (f)(1) Except as otherwise provided by this subsection, the 2-1 commission shall implement the pilot program not later than 2-2 January 1, 1997. 2-3 (2) The commission may choose not to implement the 2-4 pilot program if the commission or the commission's designee 2-5 determines that the pilot program will not result in any cost 2-6 savings to the state during the next five years. 2-7 (3) If the commission or the commission's designee 2-8 decides not to implement the provisions of this Act, it will report 2-9 its findings to the governor, lieutenant governor, speaker of the 2-10 house of representatives, chair of the Senate Health and Human 2-11 Services Committee, and the chair of the House Public Health 2-12 Committee. The report shall include: 2-13 (A) the concept paper drafted to develop and 2-14 implement the pilot program; 2-15 (B) any fiscal implications and specific 2-16 methodologies used in determining the fiscal implications of 2-17 implementing the pilot program; and 2-18 (C) the basis for the determination that the 2-19 pilot program will not result in any cost savings to the state. 2-20 SECTION 2. REPORT. Not later than January 15, 1999, the 2-21 Health and Human Services Commission shall submit to the governor 2-22 and the 76th Legislature a report concerning the effectiveness of 2-23 the pilot program. 2-24 SECTION 3. WAIVERS. If, before implementing Section 1 of 2-25 this Act, the Health and Human Services Commission determines that 2-26 a waiver or authorization from a federal agency is necessary for 2-27 implementation, the commission shall request the waiver or 2-28 authorization and may delay implementing those provisions until the 2-29 waiver or authorization is granted. 2-30 SECTION 4. EXPIRATION DATE. This Act expires September 1, 2-31 1999. 2-32 SECTION 5. EMERGENCY. The importance of this legislation 2-33 and the crowded condition of the calendars in both houses create an 2-34 emergency and an imperative public necessity that the 2-35 constitutional rule requiring bills to be read on three several 2-36 days in each house be suspended, and this rule is hereby suspended, 2-37 and that this Act take effect and be in force from and after its 2-38 passage, and it is so enacted. 2-39 * * * * *