Amend CSSB 1246 as follows:
      (1)  In Article 20C.14(a), Insurance Code, as added by
SECTION 1 of the bill (page 9, line 17, House Committee Printing),
strike "The state" and substitute "To the extent consistent with
federal law, the state".
      (2)  In Article 20C.14(b), Insurance Code, as added by
SECTION 1 of the bill (page 9, line 26, House Committee Printing),
strike "state fiscal biennium." and substitute "state fiscal
biennium, except that the system shall receive a subcontract from
the funding entity to provide services to those children if  the
system elects to receive a subcontract not later than November 1,
1997,  the system provides the state share of matching funds for
the entire population covered by the subcontract, and the
subcontract does not cover an area that is included in the
statutory territorial jurisdiction of a hospital district.  If the
system elects not to receive a subcontract or to provide the state
share of matching funds, then any entity that is selected by the
state Medicaid contracting entity to provide health care to those
children shall use existing local health care providers and
hospital providers in establishing its provider network."
      (3)  In Article 20C.14, Insurance Code, as added by SECTION 1
of the bill (page 10, between lines 20 and 21, House Committee
Printing), insert  a new Subsection (f) to read as follows:
      "(f)  The state retains the right to cancel a contract
awarded under this article if the system is sold or dissolved."