BWH H.B. 1567 75(R)BILL ANALYSIS


COUNTY AFFAIRS
H.B. 1567
By: Van de Putte
4-2-97
Committee Report (Amended)



BACKGROUND 

Hospital Districts were created in the 1950's to provide medical and
hospital care to need residents of the district.  Many hospital districts
carry out this responsibility through affiliation agreements with academic
medical centers like the University of Texas System, which operates a
graduate residency training program.  Changes in the delivery of health
care caused by the move to managed care, including the State Medicaid
program, has required hospitals districts to adapt their approach to
health services.  This is necessary because over fifty percent of a
hospital district's budget is supported by patient care revenue.  Loss of
this source of support will adversely affect the ability of hospital
districts and the graduate medical training programs to survive.
Establishment of charitable organizations by hospital districts allows
flexibility in how hospital districts render care.  

PURPOSE

H.B. 1567 explicitly authorizes hospital districts to establish charitable
organizations to carry out hospital district purposes in a manner
congruent with current hospital district methods, rules and immunities.
In addition, it provides that a charitable organization created and
controlled by the hospital district is a unit of local government for the
purpose of  Chapter 101 of the Civil Practice and Remedies Code. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency or
institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Subchapter C, Chapter 281 of the Health and Safety Code are
amended by adding Section 281.0565. 

Sec. 281.0565.  CHARITABLE ORGANIZATIONS (a)  Defines for the purposes of
this Chapter a charitable organization as one that is exempt under Section
501(a) of the Internal Revenue code by being exempt from Section 501(c)(3)
or 501(c)(4) of that code. 

(b)  The district may create a charitable organization to manage health
care services and resources for the district. 

(c)  That charitable organization is subject to the same immunity for
liability as the district and the board of the district. 

(d)  This charitable organization is a local government unit for the
purposes of Chapter 101 of the Civil Practice and Remedies Code. 

SECTION 2.  EFFECTIVE DATE.  September 1, 1997.

SECTION 3.  EMERGENCY CLAUSE.
 


EXPLANATION OF AMENDMENTS

Committee Amendment No. 1 deletes Section 281.0565(c) for the bill.