IML C.S.S.B. 30 75(R) BILL ANALYSIS
PUBLIC HEALTH
C.S.S.B. 30
By: Zaffirini (Maxey)
4-25-97
Committee Report (Substituted)
BACKGROUND
Texas spent more than $7.3 billion for Medicaid services and $1.3 billion
on financial assistance and food stamp programs in fiscal year 1995, yet
fraud may account for as much as 10 percent of all Medicaid, financial
assistance, and food stamp claims. Even if Texas loses only a fraction of
this amount to fraud, the loss represents a serious, ongoing drain on
public resources. Successful fraud control efforts demand strong referral
and detection programs, an effective investigative function, and
appropriate punishments.
The Texas Performance Review's Disturbing the Peace proposed a number of
recommendations intended to improve the state's ability to combat
fraudulent acts committed against publicly funded programs. Implementing
these recommendations will centralize and streamline fraud referral,
investigation, and prosecution efforts under the Health and Human Services
Commission's newlycreated Office of Investigations and Enforcement; ensure
appropriate use of Medicaid-funded services and equipment; tighten
provider enrollment processes through the use of background checks and
on-site inspections; require health and human services agencies to use
advanced fraud-detection technologies based on the success of the
comptroller's Medicaid Fraud Detection project; add a state qui tam cause
of action to prosecute fraudulent Medicaid providers; provide additional
controls for fraud and abuse in Medicaid managed care; and enact stiffer
penalties for fraud, especially for those acts of fraud that harm
children.
PURPOSE
CSSB 30 creates a comprehensive package of reforms intended to improve the
state's ability to combat fraudulent acts against publicly funded
programs, especially Medicaid. CSSB 30 includes the implementation of
fraud detection technologies, increased enforcement, stepped-up monitoring
of Medicaid service providers, administrative penalties, civil remedies,
and criminal sanctions. CSSB 30 creates private causes of action targeting
Medicaid fraud as well as general fraudulent activity involving government
funds.
RULEMAKING AUTHORITY
It is the committee's opinion that rulemaking authority is granted to the
Texas Department of Human Services in SECTIONS 1.01, 2.01-2.04, 3.01,
3.02, and 5.01 (Sections 22.0254(c), 32.024(t), 32.024(u), 32.0321(a),
32.039(b), (u) and (v), 32.046(a), and 23.016, Human Resources Code) and
is also referenced in Sec.32.0322(b), Human Resources Code. Rulemaking
authority is granted to the Health and Human Services Commission (HHSC) in
SECTION 1.05 (Section 531.047(a), Government Code), and SECTION 2.06(a);
and referenced in SECTION 1.07(c), and SECTION 2.05(a) (Article
4413(502)(n) V.T.C.S.). Additional rulemaking authority is also granted to
the secretary of state in SECTION 1.07(c); to HHSC and each agency
operating part of the state Medicaid program in SECTION 2.07(c); and to
the board of a state agency that operates part of the Medicaid program in
SECTION 4.06 (Section 36.005(b), Human Resources Code) of this bill.
SECTION BY SECTION ANALYSIS
ARTICLE 1. GENERAL PROVISIONS RELATING TO WELFARE AGENCIES
SECTION 1.01. COLLECTION OF FOOD STAMP AND FINANCIAL ASSISTANCE PAYMENTS
MADE IN ERROR. (a) Amends Chapter 22, Human Resources Code, by adding
Sections 22.0251-22.0252, as follows:
Sec. 22.0251. TIMELY DETERMINATION OF OVERPAYMENTS. Requires the Texas
Department of Human Services (department), subject to the approval of the
commissioner of health and human services (commissioner), to record the
time taken to discover an error in making a grant; set progressive goals
for reducing the discovery time; and adopt a schedule to meet these goals.
Requires the department to submit a progress report.
Sec. 22.0252. TELEPHONE COLLECTION PROGRAM. Requires the department to
use the telephone to collect reimbursement from a person who receives
benefits granted in error, and submit a semiannual report.
Sec. 22.0253. PARTICIPATION IN FEDERAL TAX REFUND OFFSET PROGRAM.
Requires the department to participate in the Federal Tax Refund Offset
Program to attempt to recover benefits granted in error, and submit as
many claims as possible for offset against income tax returns.
Sec. 22.0254. PROSECUTION OF FRAUDULENT CLAIMS. Requires the department
to keep a record of the dispositions of referrals made by the department
to a district attorney concerning fraudulent claims for benefits. Allows
the department to request status information on each major fraudulent
claim, request a written explanation for each case referred in which the
district attorney declines to prosecute, and encourage the creation of a
special welfare fraud unit in certain district attorneys' offices. Allows
the department, by rule, to define what constitutes a major fraudulent
claim.
(b) Amends Chapter 22, Human Resources Code, by adding Section 22.0291,
as follows:
Sec. 22.0291. INFORMATION MATCHING SYSTEM RELATING TO IMMIGRANTS AND
FOREIGN VISITORS. Requires the department to use a computerized matching
system to prevent certain individuals from unlawfully receiving benefits
administered by the department. Allows the department to enter into an
agreement with the Department of State of the United States and the United
States Department of Justice. Requires the department and federal
agencies to protect the confidentiality of shared information. Requires
the department to submit a semiannual report.
(c) Requires the department to begin operation of the telephone
collection program not later than January 1, 1998.
(d) Requires the department to submit the initial reports required by
Sections 22.0251(b) and 22.0291(e), Human Resources Code, not later than
January 1, 1998.
(e) Requires the department to submit the initial report required by
Section 22.0252(b), Human Resources Code, not later than September 1,
1998.
SECTION 1.02. USE OF EARNED FEDERAL FUNDS. Amends Chapter 22, Human
Resources Code, by adding Section 22.032, as follows:
Sec. 22.032. USE OF EARNED FEDERAL FUNDS. Allows the department, subject
to the General Appropriations Act, to use earned federal funds derived
from recovery of amounts paid or benefits granted by the department as a
result of fraud to pay the costs of the department's activities relating
to preventing fraud.
SECTION 1.03. PAYMENT OF MEDICAID CLAIMS. (a) Amends Subchapter B,
Chapter 32, Human Resources Code, by adding Sections 32.043 and 32.044, as
follows:
Sec. 32.043. DUAL MEDICAID AND MEDICARE COVERAGE. Requires the
department to identify each individual receiving dual Medicaid and
Medicare coverage, and to analyze claims to ensure that payment is sought
first under the Medicare program to the extent allowed by law.
Sec. 32.044. MISDIRECTED BILLING. Requires the department to develop a
procedure for matching claims to determine alternative responsibility for
payment and ensuring that the appropriate entity bears the cost.
(b) This section takes effect on the first date that it may take effect
under Section 39, Article III, Texas Constitution.
SECTION 1.04. ENHANCED MEDICAID REIMBURSEMENT. (a) Amends Subchapter
B, Chapter 32, Human Resources Code, by adding Section 32.045, as follows:
Sec. 32.045. ENHANCED REIMBURSEMENT. Requires the department to develop
a procedure for identifying each service provided under the medical
assistance program for which the state is eligible to receive enhanced
reimbursement of costs from the federal government and ensuring that the
state seeks the highest level of federal reimbursement available.
(b) Requires the Texas Department of Health (TDH) to identify and seek
reimbursement for all services provided under the state Medicaid program
for a certain period for which the state was eligible but did not receive
enhanced reimbursement of costs at a certain rate.
(c) This section takes effect on the first date that it may take effect
under Section 39, Article III, Texas Constitution.
SECTION 1.05. MINIMUM COLLECTION GOAL. (a) Amends Subchapter B, Chapter
531, Government Code, by adding Section 531.047, as follows:
Sec. 531.047. MINIMUM COLLECTION GOAL. Requires HHSC, by rule, to set a
minimum goal for the department specifying the amount of benefits granted
in error that the department should recover. Requires the comptroller, if
the department fails to meet this goal, to reduce the department's general
revenue appropriations by a specified amount. Requires HHSC, the
governor, and the Legislative Budget Board to monitor the department's
performance, and requires the department to cooperate by providing
information on request.
(b) This section takes effect on the first date that it may take effect
under Section 39, Article III, Texas Constitution.
SECTION 1.06. COMMISSION POWERS AND DUTIES RELATING TO WELFARE FRAUD. (a)
Amends Chapter 531, Government Code, by adding Subchapter C, as follows:
SUBCHAPTER C. MEDICAID AND OTHER WELFARE FRAUD, ABUSE, OR OVERCHARGES
Sec. 531.101. AWARD FOR REPORTING MEDICAID FRAUD, ABUSE, OR OVERCHARGES.
Allows HHSC to grant an award to an individual who reports activity
constituting fraud, abuse of funds, or overcharges. Requires HHSC to
determine the amount of an award. An award under this section is subject
to appropriation. Payment of an award from federal funds is subject to
federal law. An action under Subchapter C, Chapter 36, Human Resources
Code, precludes an award under this section.
Sec. 531.102. INVESTIGATIONS AND ENFORCEMENT OFFICE. Sets forth the
terms by which HHSC, through the office of investigations and enforcement,
is responsible for the investigation of fraud and the enforcement of state
law relating to the provision of health and human services. Requires HHSC
to set certain objectives, priorities, and performance standards for the
office and train office staff to enable pursuit of priority Medicaid and
welfare fraud and abuse cases. Allows HHSC to require employees of
health and human services agencies to provide assistance to HHSC regarding
the investigation of fraud.
Sec. 531.103. INTERAGENCY COORDINATION. Requires HHSC and the office of
the attorney general to enter into a memorandum of understanding to
implement procedures for processing cases of suspected fraud, waste, or
abuse as specified. Provides that an exchange of information under this
section does not affect whether the information is subject to disclosure
under Chapter 552, Government Code. Requires HHSC and the attorney
general to submit a semiannual report. Prohibits the assessment or
collection of fees unless the state collects a penalty, restitution, or
other reimbursement payment. Requires HHSC to refer cases of suspected
fraud to the appropriate attorney or agency if the attorney general fails
to act in the specified time, and allows these parties to collect fees and
a percent of the award.
Sec. 531.104. ASSISTING INVESTIGATIONS BY ATTORNEY GENERAL. Requires
HHSC and the attorney general to execute a memorandum of understanding
under which HHSC is required to provide investigative support to the
attorney general, but HHSC is not required to provide support in over 100
open investigations per fiscal year.
Sec. 531.105. FRAUD DETECTION TRAINING. Requires HHSC to implement a
program to provide specified training to contractors and staff to aid in
identifying cases of fraud, waste, or abuse. Requires TDH and the
department, in cooperation with HHSC, to periodically set a goal of the
number of cases that each agency will attempt to identify and refer to
HHSC. Requires HHSC to include goal-related information in the report.
Sec. 531.106. LEARNING OR NEURAL NETWORK TECHNOLOGY. Requires HHSC to
use learning or neural network technology to identify and deter fraud;
contract with a private or public entity to develop and implement the
technology; require certain health and human services agencies to
participate; maintain all information necessary to apply the technology to
claims data covering a two-year period; and refer cases identified by the
technology to the appropriate office. Allows the commission to require
the entity it contracts with to install and operate the technology at
certain locations. Requires the data used for neural network processing
to be maintained as an independent subset for security purposes.
Sec. 531.107. MEDICAID AND PUBLIC ASSISTANCE FRAUD OVERSIGHT TASK FORCE.
Provides that the Medicaid and Public Assistance Fraud Oversight Task
Force assists HHSC and the office of investigations and enforcement in
improving the efficiency of fraud investigations and collections. Sets
forth the composition, presiding officer, and meeting times of the task
force. Sets forth the compensation for a member's service on the task
force. Establishes the conditions under which the commission's office of
investigations and enforcement is required to provide certain information
to the task force.
Sec. 531.108. FRAUD PREVENTION. Requires the office of investigations
and enforcement to compile and disseminate accurate information and
statistics relating to fraud prevention and certain post-fraud referrals.
Requires HHSC to publicize successful fraud prosecutions, ensure the
maintenance and promotion of a toll-free hotline, develop a cost-effective
method of identifying applicants for public assistance in certain areas,
verify automobile information used as eligibility criteria, establish a
computerized matching system to prevent an incarcerated individual from
illegally receiving benefits, and submit a semiannual report.
Sec. 531.109. DISPOSITION OF FUNDS. Requires HHSC to deposit funds
collected under this subchapter in a special account in the state
treasury. Allows HHSC to spend money in this account to administer this
subchapter.
(b) Amends Section 22.028(c), Human Resources Code, to make a conforming
change.
(c) Sets forth the terms under which Section 531.104, Government Code,
takes effect.
(d) Requires HHSC to award the contract for the learning or neural
network technology, and the contractor is required to begin operations, by
January 1, 1998. Sets forth the terms by which the commissioner is
required to enter into an interagency agreement and execute a memorandum
of understanding with the comptroller if the contract is not awarded or
the contractor can not begin operations by the specified date.
(e) Requires HHSC to submit the initial report required by Section
531.108(e) not later than April 1, 1998.
(f) Provides that this article, in adding Section 531.101, Government
Code, conforms to a change in law made by Section 1, Chapter 444, Acts of
the 74th Legislature, Regular Session, 1995.
(g) Repealer: Section 16G, Article 4413(502), V.T.C.S., as added by
Section 1, Chapter 444, Acts of the 74th Legislature, Regular Session,
1997.
(h) Sets forth the terms by which this Act prevails over another Act of
the 75th Legislature.
(i) Repealer: Section 21.0145, Human Resources Code (Public Assistance
Fraud Oversight Task Force) and Section 22.027, Human Resources Code
(Fraud Prevention).
(j) Sections 531.102 and 531.106 take effect on the first date that they
may take effect under Section 39, Article III, Texas Constitution.
SECTION 1.07. CONSOLIDATION OF STAFF. Sets forth the terms by which the
powers, duties, programs, funds, contracts, records, employees, and rules
or forms adopted by the department's utilization and assessment review
function or TDH's claims review and analysis group and policy and data
analysis group are transferred to HHSC. Allows the secretary of state to
adopt rules as necessary to expedite the implementation of this
subsection. Requires the commissioner to oversee and assist the transfer
as specified. Requires the commissioner to file any federal plan changes
as specified. Makes application of this Act prospective regarding the
consolidation of investigations staff. This section takes effect on the
first date that it may take effect under Section 39, Article III, Texas
Constitution.
SECTION 1.08. USE OF PRIVATE COLLECTION AGENTS. Allows the department,
with assistance from the Council on Competitive Government, and subject to
approval by the attorney general, to use private collections agents to
collect reimbursements for benefits granted in error. Requires the
department, if approved by the attorney general, to ensure that the
collection agents are engaged in work not later than March 1, 1998.
Requires the department to submit a progress report and adjust the number
of claims referred to agents as appropriate.
SECTION 1.09. EXPEDITED FOOD STAMP DELIVERY; IMPACT ON FRAUDULENT CLAIMS.
Requires the department to conduct a study to determine the impact of
one-day screening and service delivery requirements on the level of fraud
in the food stamp program, and submit a report.
SECTION 1.10. STUDY ON COLLECTION OF ERRONEOUS FOOD STAMP OR FINANCIAL
ASSISTANCE BENEFITS THROUGH LIENS OR WAGE GARNISHMENT. Requires the
department to conduct a study on collection of erroneous food stamp or
financial assistance benefits through liens or wage garnishment, and
submit a report.
SECTION 1.11. OPERATION RESTORE TRUST. Requires HHSC and the office of
the attorney general to cooperate with entities in other states
participating in "Operation Restore Trust" and share information. Defines
"Operation Restore Trust."
ARTICLE 2. MEDICAID SERVICE PROVIDERS
SECTION 2.01. AUTHORIZATION FOR AMBULANCE SERVICES. Amends Section
32.024, Human Resources Code, by adding Subsection (t), requiring the
department, by rule, to require a physician, nursing facility, or other
health care provider to obtain authorization for non-emergency ambulance
services. Requires HHSC and each appropriate health and human services
agency to adopt these rules not later than January 1, 1998. This section
takes effect on the first date that it may take effect under Section 39,
Article III, Texas Constitution.
SECTION 2.02. DURABLE MEDICAL EQUIPMENT. Amends Section 32.024, Human
Resources Code, by adding Subsection (u), requiring the department, by
rule, to require a health care provider who arranges for durable medical
equipment for a child who receives medical assistance to ensure that the
child receives the proper equipment, the equipment fits properly, and the
child or the child's parent or guardian receives the proper instruction;
requires that a record of compliance with these requirements be
maintained. Requires HHSC and each appropriate health and human services
agency to adopt these rules not later than January 1, 1998. This section
takes effect on the first date that it may take effect under Section 39,
Article III, Texas Constitution.
SECTION 2.03. SURETY BOND. Amends Subchapter B, Chapter 32, Human
Resources Code, by adding Section 32.0321, as follows:
Sec. 32.0321. SURETY BOND. Allows the department, by rule, to require
each provider of medical assistance in a provider type that has
demonstrated significant potential for fraud or abuse to file a surety
bond.
SECTION 2.04. CRIMINAL HISTORY INFORMATION. (a) Amends Subchapter B,
Chapter 32, Human Resources Code, by adding Section 32.0322, as follows:
Sec. 32.0322. CRIMINAL HISTORY RECORD INFORMATION. Allows the department
to obtain the criminal history record information relating to a provider
or a person applying to enroll as a provider. Requires the department, by
rule, to establish criteria for revoking a provider's enrollment or
denying a person's application to enroll as a provider.
(b) Amends Subchapter F, Chapter 411, Government Code, by adding Section
411.132, as follows:
Sec. 411.132. ACCESS TO CRIMINAL HISTORY RECORD INFORMATION; AGENCIES
OPERATING PART OF MEDICAL ASSISTANCE PROGRAM. Provides that HHSC or an
agency operating part of the medical assistance program is entitled to
obtain criminal history record information relating to a provider or a
person applying to enroll as a provider. Prohibits such information from
being released or disclosed except in certain circumstances.
SECTION 2.05. MANAGED CARE ORGANIZATIONS. (a) Amends Section 16A,
Article 4413(502), Revised Statutes, by amending Subsection (n) and adding
Subsections (o)-(t), requiring a managed care organization that contracts
with the state to report all information required by rule; develop and
submit a plan for preventing, detecting, and reporting fraud and abuse;
include standard provisions in each subcontract that affects the delivery
of or payment for Medicaid services; and submit the subcontract and annual
disclosure statements to HHSC for approval. Requires the operating agency
to require each contract to contain certain provisions, and to audit each
managed care organization that contracts with the state. Sets forth the
terms by which an audited managed care organization is responsible for
paying the costs of the audit. Requires the operating agency and the
Texas Department of Insurance to enter into a memorandum of understanding.
Defines "operating agency." This section expires September 1, 2001.
(b) Amends Section 532.001, Government Code, as added by HB. 1845 or S.B.
898, Acts of the 75th Legislature, Regular Session, 1997, by adding
Subdivision (5) defining "operating agency."
(c) Amends Subchapter B, Chapter 532, Government Code as added by H.B.
1845 or S.B. 898, Acts of the 75th Legislature, Regular Session, 1997, by
adding Sections 532.112 and 532.113, as follows:
Sec. 532.112. DUTIES OF MANAGED CARE ORGANIZATION; CONTRACTUAL
PROVISIONS. Makes conforming changes.
Sec. 532.113. AUDITS; MEMORANDUM OF UNDERSTANDING. Makes conforming
changes.
(d) Requires TDH or the appropriate health and human services agency
operating part of the state Medicaid program to develop guidelines
applicable to a managed care organization's plan for preventing,
detecting, and reporting Medicaid fraud not later than November 1, 1997.
(e) Makes application of this Act prospective to November 1, 1997
regarding a managed care organization that enters into a contract with
HHSC.
(f) This section applies to contracts entered into or renewed on or after
the effective date.
(g) Sets forth those conditions which do not have to be met by a managed
care organization that contracts with the state before the effective date
of this section.
(h) Requires a managed care organization that renews a contract or
subcontract after the effective date to include all provisions required by
this section.
(i) Sets forth the terms under which Subsection (a) takes effect.
(j) Sets forth the terms under which Subsections (b) and (c) take
effect.
SECTION 2.06. PILOT PROGRAM; ON-SITE REVIEWS OF PROSPECTIVE PROVIDERS.
Requires HHSC, by rule, to establish and implement a pilot program to
reduce fraud by conducting random on-site reviews of certain providers.
Allows HHSC to waive an on-site review of a prospective provider under
certain circumstances and to expand the pilot program. Requires HHSC to
submit an effectiveness report as specified. This section expires
September 1, 1999.
SECTION 2.07. DEVELOPMENT OF NEW PROVIDER CONTRACT. Requires HHSC to
develop a new provider contract that contains provisions designed to
strengthen HHSC's ability to prevent provider fraud. Requires HHSC and
each agency operating part of the state Medicaid program, by rule, to
require each provider who enrolled in the program before the effective
date of this section to re-enroll under the new contract.
SECTION 2.08. COMPETITIVE PROCESS FOR OBTAINING DURABLE MEDICAL EQUIPMENT.
Requires TDH to develop a process for selecting providers of durable
medical equipment and supplies, and requires HHSC to submit an amendment
to the state's Medicaid plan authorizing implementation of the process
developed by TDH. This section takes effect on the first date that it may
take effect under Section 39, Article III, Texas Constitution.
SECTION 2.09. REVIEW OF SERVICE PROVIDER BILLING PRACTICES. Requires TDH
to conduct an automated review of providers to identify improper billing
practices, to refer these to HHSC's office of investigations and
enforcement, and to require the entity that administers the state Medicaid
program to modify the entity's claims processing, monitoring procedures,
and computer technology to prevent improper billing. This section takes
effect on the first date that it may take effect under Section 39,
Article III, Texas Constitution.
ARTICLE 3. ADMINISTRATIVE PENALTIES AND SANCTIONS RELATING TO MEDICAID
FRAUD
SECTION 3.01. ADMINISTRATIVE PENALTIES. (a) Amends Section 32.039,
Human Resources Code, as follows:
Sec. 32.039. (a) New heading: DAMAGES AND PENALTIES. Defines "claim,"
"managed care organization," and "managed care plan." Provides that a
person commits a violation if the person presents to the department a
claim that contains a statement or representation that the person knows to
be false; or is a managed care organization that fails to provide a
required health care benefit or service and fails to provide certain
required information, or engages in a fraudulent activity in connection
with enrollment of, or marketing to, an individual eligible for medical
assistance. Replaces all references to "false claim" with "violation."
Provides for administrative penalties for violations under Subsections
(b) and (c)(2). Sets forth standard procedures and considerations related
to the assessment of administrative penalties. Requires a person who is
subject to a board order under this Section to pay the amount of the
penalty or petition for judicial review. Allows a person to stay
enforcement of the penalty. Allows the commissioner to contest the
affidavit. Requires the court to hold a hearing. Deletes the existing
provisions regarding judicial review. Prohibits a person found liable for
certain violations under Subsection (c) from providing health care
services for a certain period. Authorizes the department, by rule, to
provide for an extended period of ineligibility.
(b) The change in law made by this Section applies only to violations of
which each element is committed on or after the effective date.
SECTION 3.02. SANCTIONS APPLICABLE TO VENDOR DRUG PROGRAM. Amends
Subchapter B, Chapter 32, Human Resources Code, by adding Section 32.046,
as follows:
Sec. 32.046. VENDOR DRUG PROGRAM; SANCTIONS AND PENALTIES. Requires the
department to adopt rules governing sanctions and penalties that apply to
a provider in the vendor drug program who submits an improper claim for
reimbursement; and to notify each provider in the program that the
provider is subject to sanctions and penalties.
SECTION 3.03. PROHIBITION OF CERTAIN PERSONS CONVICTED OF FRAUD. Amends
Subchapter B, Chapter 32, Human Resources Code, by adding Section 32.047,
as follows:
Sec. 32.047. PROHIBITION OF CERTAIN HEALTH CARE SERVICE PROVIDERS. A
person is permanently prohibited from providing or arranging to provide
health care services if the person is convicted of an offense arising out
of a fraudulent act resulting in injury to an elderly, disabled, or young
person.
SECTION 3.04. DEDUCTIONS FROM LOTTERY WINNINGS. (a) Amends Sections
466.407(a) and (c), Government Code, by removing " the state treasurer" as
one of the sources from which a payment is determined to be delinquent and
adding language to clarify that the determination of delinquency includes
delinquency in reimbursing the department for a benefit granted in error.
Includes the department among the entities required to provide the
executive director with a report of persons who have been determined to be
delinquent.
(b) Requires the department to implement the change in law made by this
section not later than January 1, 1998. Prohibits the department from
seeking recovery through lottery prize deduction of an amount of a benefit
granted in error to a person.
(c) Sets forth the terms by which the executive director of the Texas
Lottery Commission is required to deduct erroneous amounts from lottery
prizes.
ARTICLE 4. CIVIL REMEDIES RELATING TO MEDICAID FRAUD AND CREATION OF
CRIMINAL OFFENSE
SECTION 4.01. REDESIGNATION. (a) Amends Chapter 36, Human Resources
Code, by designating Sections 36.001, 36.002, and 36.007-36.012 as
Subchapter A; renumbering Sections 36.007-36.012 as Sections
36.003-36.008, respectively, and adding a subchapter heading as follows:
SUBCHAPTER A. GENERAL PROVISIONS
(b) Amends Chapter 36, Human Resources Code, by designating Sections
36.003-36.006 as Subchapter B, renumbering those sections as Sections
36.051-36.054, respectively, and adding a subchapter heading, as follows:
SUBCHAPTER B. ACTION BY ATTORNEY GENERAL
SECTION 4.02. DEFINITIONS. Amends Section 36.001, Human Resources Code,
by amending Subdivisions (5)-(11) and adding Subdivision (12), to define
"managed care organization" and to include the term "managed care
organization" in the definition of "provider." Makes conforming changes.
SECTION 4.03. UNLAWFUL ACTS RELATING TO MANAGED CARE ORGANIZATION. Amends
Section 36.002, Human Resources Code, by adding subdivision (10) which
sets forth the terms by which a managed care organization engages in
unlawful acts.
SECTION 4.04. APPLICABLE PENALTIES AND CONFORMING AMENDMENT. Amends
Section 36.004, Human Resources Code, as renumbered by this article as
Section 36.052, by amending Subsections (a) and (e), to provide a civil
penalty of a specified amount for unlawful acts that result in injury to
an elderly, disabled, or young person; and a to make conforming changes.
SECTION 4.05. CONFORMING AMENDMENT. Amends Section 36.005, Human
Resources Code, as renumbered by this article as Section 36.053, by
amending Subsection (b), to make a conforming change.
SECTION 4.06. ADDITIONAL SANCTIONS FOR MEDICAID FRAUD. Amends Section
36.009, Human Resources Code, as renumbered by this article as Section
36.005, to require the executive director of the Department of Protective
and Regulatory Services, or another health care regulatory agency, to
suspend or revoke certain provider agreements, permits, licenses, and
certifications found liable for an unlawful act; and allows the executive
director to suspend or revoke the agreement, license, permit, or
certification of persons who operate a nursing facility found liable for
an unlawful act. Prohibits a person found liable under Section 32.052
from providing health care services for a certain period. Allows the board
of a state agency that operates part of the Medicaid program, by rule, to
extend the ineligibility period longer than 10 years.
SECTION 4.07. AUTHORITY OF ATTORNEY GENERAL. (a) Amends Subchapter B,
Chapter 36, Human Resources Code, by adding Section 36.055, as follows:
Sec. 36.055. ATTORNEY GENERAL AS RELATOR IN FEDERAL ACTION. Allows the
attorney general to bring an action as relator regarding an act in
connection with the Medicaid program for which a person may be held
liable. Allows the attorney general to contract with a private attorney.
(b) Requires the attorney general to develop strategies to increase state
recoveries and report the results of the office's effort to the
legislature.
SECTION 4.08. CIVIL ACTION BY PRIVATE PERSON FOR MEDICAID FRAUD. Amends
Chapter 36, Human Resources Code, by adding Subchapter C, as follows:
SUBCHAPTER C. ACTION BY PRIVATE PERSONS
Sec. 36.101. ACTION BY PRIVATE PERSON AUTHORIZED. Allows a person to
bring a civil action for a violation of Section 36.002 for the person and
the state in the name of the state. (Qui tam)
Sec. 36.102. INITIATION OF ACTION. Requires a person bringing an action
under this subchapter to notify the attorney general as specified. Allows
the state to intervene and to request time extension. Allows an action to
be dismissed by the court and the attorney general.
Sec. 36.103. ANSWER BY DEFENDANT. A defendant is not required to file
an answer to a petition until the 20th day after service.
Sec. 36.104. STATE'S DECISION TO CONTINUE ACTION. Requires the state to
proceed with the action or notify the court that the state declines to
take over the action within a specified time period.
Sec. 36.105. REPRESENTATION OF STATE BY PRIVATE ATTORNEY. Allows the
attorney general to contract with a private attorney to represent the
state in an action.
Sec. 36.106. INTERVENTION BY OTHER PARTIES PROHIBITED. Prohibits a
person other than the state from intervening or bringing a related action
based on the facts underlying a pending action.
Sec. 36.107. RIGHTS OF PARTIES IF STATE CONTINUES ACTION. Sets forth the
rights of the parties to an action if the state proceeds with the action.
The state has primary responsibility for prosecuting the action, but the
person bringing the action has the right to continue as a party, subject
to the limitations set forth in this section.
Sec. 36.108. RIGHTS OF PARTIES IF STATE DOES NOT CONTINUE ACTION. Sets
forth the rights of the parties to an action if the state elects not to
proceed with the action.
Sec. 36.109. STAY OF CERTAIN DISCOVERY. Sets forth the terms by which
the court is authorized to stay the discovery for a certain period under
certain circumstances. Requires a motion to stay discovery to be heard in
camera.
Sec. 36.110. PURSUIT OF ALTERNATE REMEDY BY STATE. Allows the state to
pursue the state's claim through any alternate remedy available to the
state, notwithstanding Section 36.101. Establishes the rights of the
person bringing the action if an alternate remedy is pursued in another
proceeding. Sets forth the terms under which a finding of fact or
conclusion of law in a proceeding under this section is final and
conclusive.
Sec. 36.111. AWARD TO PRIVATE PLAINTIFF. Except as provided by
Subsection (b), if the state proceeds with the action, the person bringing
the action is entitled to 10-25% of the proceeds. If the state does not
proceed with the action, the person is entitled to 25-30% of the proceeds.
Defines "proceeds of the action."
Sec. 36.112. REDUCTION OF AWARD. Sets forth the terms by which the court
may reduce the share of the proceeds of an action the person would
otherwise receive under Section 36.111, and is required to dismiss the
person from the civil action, under certain circumstances. Prohibits the
person from receiving any share of the proceeds in certain situations.
Sec. 36.113. AWARD TO DEFENDANT FOR FRIVOLOUS ACTION OR ACTION BROUGHT
FOR PURPOSES OF HARASSMENT. Allows the court to award the defendant
reasonable attorney's fees and expenses if the defendant prevails in the
action and the court finds that the claim was frivolous, vexatious, or
brought for purposes of harassment. Provides that Chapter 105, Civil
Practice and Remedies Code, applies in an action with which the state
proceeds.
Sec. 36.114. CERTAIN ACTIONS BARRED. Prohibits a person from bringing an
action under certain circumstances. Defines "original source."
Sec. 36.115. STATE NOT LIABLE FOR CERTAIN EXPENSES. The state is not
liable for expenses that a person incurs in bringing an action under this
section.
Sec. 36.116. RETALIATION BY EMPLOYER AGAINST PERSON BRINGING SUIT
PROHIBITED. Establishes the terms by which a person who is discharged,
demoted, suspended, harassed, or discriminated against by the person's
employer because of a lawful act taken by the person in furtherance of an
action under this subchapter is entitled to reinstatement with the same
seniority status and a certain amount of back pay and compensation.
Allows a person to bring an action for the relief provided in this
section.
Sec. 36.117. SOVEREIGN IMMUNITY NOT WAIVED. Provides that except as
specified, this Subchapter does not waive sovereign immunity.
Sec. 36.118. ATTORNEY GENERAL COMPENSATION. Allows the office of the
attorney general to retain a reasonable portion of recoveries under this
subchapter, not to exceed amounts specified in the General Appropriations
Act, for the administration of this subchapter.
SECTION 4.09. CRIMINAL OFFENSE AND REVOCATION OF CERTAIN LICENSES.
Amends Chapter 36, Human Resources Code, by adding Subchapter D, as
follows:
SUBCHAPTER D. CRIMINAL PENALTIES AND REVOCATION OF CERTAIN OCCUPATIONAL
LICENSES
Sec. 36.131. CRIMINAL OFFENSE. Provides that a person commits an offense
if the person commits an unlawful act under Section 36.002, ranging from a
Class C misdemeanor to a first degree felony, depending on the value of
the payment or benefit provided. Provides that if conduct constituting an
offense also constitutes an offense under another provision of law,
including a provision in the Penal Code, an actor may be prosecuted under
either this section or the other provision. Sets forth the terms by which
payments or benefits provided as a result of one scheme or continuing
course of conduct are authorized to be considered as one offense, and
aggregated in determining the grade of the offense.
Sec. 36.132. REVOCATION OF LICENSES. Defines "license" and "licensing
authority." Requires a licensing authority to revoke a license if the
person is convicted of a felony under Section 36.131.
SECTION 4.10. APPLICATION. The changes in law made by this article apply
to a violation of which each element was committed on or after the
effective date.
ARTICLE 5. SUSPENSION OF LICENSES
SECTION 5.01. SUSPENSION OF LICENSES. (a) Amends Subtitle B, Title 2,
Human Resources Code, by adding Chapter 23, as follows:
CHAPTER 23. SUSPENSION OF DRIVER'S OR RECREATIONAL LICENSE FOR FAILURE TO
REIMBURSE DEPARTMENT
Sec. 23.001. DEFINITIONS. Defines "license" and "order suspending a
license."
Sec. 23.002. LICENSING AUTHORITIES SUBJECT TO CHAPTER. Defines "licensing
authority."
Sec. 23.003. SUSPENSION OF LICENSE. Allows the department to issue an
order suspending a license of certain persons.
Sec. 23.004. INITIATION OF PROCEEDING. Allows the department to initiate
a proceeding to suspend a person's license. Requires the proceeding to be
conducted by the department's hearings division. Requires the
commissioner to render a final decision.
Sec. 23.005. CONTENTS OF PETITION. Sets forth the contents of a petition
for license suspension.
Sec. 23.006. NOTICE. Requires the department, on initiating a
proceeding, to give notice as specified.
Sec. 23.007. HEARING ON PETITION TO SUSPEND LICENSE. Requires the
hearings division of the department to promptly schedule a hearing, notify
the appropriate parties, and stay suspension pending the hearing, if a
hearing request is properly filed.
Sec. 23.008. ORDER SUSPENDING LICENSE. Requires the department to render
an order suspending a license and to forward the order to the appropriate
authority upon an appropriate finding. Allows the department to stay such
an order. Requires the department to dismiss the petition on finding that
the petition for suspension should be denied.
Sec. 23.009. DEFAULT ORDER. Requires the department to consider the
allegations of the petition for suspension to be admitted, and render
an order suspending a license if the person fails to respond to the
notice, request a hearing, or appear at the hearing.
Sec. 23.010. REVIEW OF FINAL ADMINISTRATIVE ORDER. Provides that an
order issued by the department is a final agency decision and subject to
review as provided by Chapter 2001, Government Code.
Sec. 23.011. ACTION BY LICENSING AUTHORITY. Requires a licensing
authority to take certain actions on receipt of a final order suspending a
license, and prohibits other actions. Sets forth the terms by which a
person who continues to engage in the licensed activity after the
implementation of the order is liable for certain civil and criminal
penalties. Exempts a licensing authority from liability for acting under
this chapter. Establishes that the denial or suspension of a driver's
license is governed by this chapter and not by Subtitle B, Title 7,
Transportation Code.
Sec. 23.012. MOTION TO REVOKE STAY. Allows the department to file a
motion to revoke the stay of an order suspending a license under certain
circumstances, and requires the department to revoke the stay and render a
final order suspending a license under certain circumstances.
Sec. 23.013. VACATING OR STAYING ORDER SUSPENDING A LICENSE. Allows the
department to render an order vacating or staying an order suspending a
license. Requires the department to promptly vacate or stay such order.
Sets forth the terms by which on receipt of such an order, the licensing
authority is required to reinstate and return the affected license to the
person.
Sec. 23.014. FEE BY LICENSING AUTHORITY. Allows a licensing authority to
charge a fee to a person who is the subject of an order suspending a
license.
Sec. 23.015. COOPERATION BETWEEN LICENSING AUTHORITIES AND DEPARTMENT.
Allows the department to request certain information from each licensing
authority, and requires a licensing authority to provide the information.
Allows the department to enter into a cooperative agreement with a
licensing authority and to adopt a reasonable implementation schedule.
Sec. 23.016. RULES, FORMS, AND PROCEDURES. Requires the department, by
rule, to prescribe forms and procedures for the implementation of this
chapter.
(b) Requires the department to take all action necessary to implement the
change in law made by this article not later than January 1, 1998.
Prohibits the department from suspending a license because of a person's
failure to reimburse the department for a benefit granted in error before
September 1, 1997.
ARTICLE 6. MEASUREMENT OF FRAUD
SECTION 6.01. HEALTH CARE FRAUD STUDY. (a) Amends Subchapter B, Chapter
403 Government Code, by adding Section 403.026, as follows:
Sec. 403.026. HEALTH CARE FRAUD STUDY. Requires the comptroller to
conduct a study each biennium to determine the number and type of
fraudulent claims submitted for certain benefits. Requires the
comptroller and certain state agencies to cooperate, and allows them to
enter into a memorandum of understanding. Requires the comptroller to
report the results of the study to each applicable agency.
(b) Requires the comptroller to complete the initial study required by
Section 403.026, Government Code, not later than December 1, 1998.
SECTION 6.02. COMPILATION OF STATISTICS. (a) Amends Subchapter B,
Chapter 531, Government Code, by adding Section 531.0215, as follows:
Sec. 531.0215. COMPILATION OF STATISTICS RELATING TO FRAUD. Requires
HHSC and each health and human services agency that administers a part of
the state Medicaid program to maintain statistics on fraudulent claims for
benefits.
(b) Amends Subchapter C, Chapter 501, Labor Code, by adding Section
501.0431, as follows:
Sec. 501.0431. COMPILATION OF STATISTICS RELATING TO FRAUD. Requires the
director to maintain statistics on fraudulent claims for medical benefits.
(c) Amends Section 17(a), Texas Employees Uniform Group Insurance
Benefits Act (Article 3.50-2, V.T.C.S.), to require the trustee to
maintain statistics on fraudulent claims for benefits under this Act.
ARTICLE 7. GENERAL FALSE CLAIMS
SECTION 7.01. GENERAL FALSE CLAIMS ACT. (a) Amends Subtitle F, Title
10, Government Code, by adding Chapter 2259, as follows:
CHAPTER 2259. FALSE CLAIMS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2259.001. DEFINITIONS. Defines "claim," "government contractor,"
"governmental entity," "local governmental entity," "managing official,"
and "prosecuting authority."
Sec. 2259.002. PROHIBITED ACTS. Prohibits a person from presenting a
false claim for payment or approval to any governmental entity or
contractor; making or using a false record or statement to obtain payment
or approval of a false claim; conspiring to defraud a governmental entity
or contractor; delivering less property than the amount of property for
which the person receives a receipt; making or delivering a receipt
falsely representing the amount of property delivered; buying or accepting
as a pledge of an obligation or debt public property from unauthorized
persons; making or using a false record or statement to conceal, avoid, or
decrease an obligation to pay or transmit money or property; accepting the
benefits from a false claim made by any person; or causing any of the
above acts to be committed by another person.
Sec. 2259.003. REPRESENTATION OF STATE BY PRIVATE ATTORNEY. The attorney
to represent the state in an action under this chapter.
Sec. 2259.004. SOVEREIGN IMMUNITY.
SUBCHAPTER B. LIABILITY FOR VIOLATIONS
Sec. 2259.011. LIABILITY FOR KNOWING VIOLATION. Establishes the terms
by which a court that finds that a person knowingly violated Section
2259.002 is required to award the affected governmental entity certain
costs and damages, and is allowed to reduce the amount of exemplary
damages awarded under Subsection (a)(2). Defines "knowingly violates"
under Section 2259.002.
Sec. 2259.012. CIVIL PENALTY. Allows the court to award the affected
governmental entity a civil penalty of not more than $10,000 for each
false claim, with certain exceptions.
Sec. 2259.013. LIABILITY JOINT AND SEVERAL; PROPORTIONATE RESPONSIBILITY
INAPPLICABLE. Provides that liability is joint and several for a
violation committed by more than one person if the violation is committed
with the specified knowledge requirement.
Sec. 2259.014. EXCEPTIONS. Prohibits a court from awarding exemplary
damages and attorney's fees and costs or a civil penalty against a person
if the total actual damages resulting from all violations for which
damages are being assessed against the person is less than $500.
Sec. 2259.015. DEPOSIT OF MONEY. Requires money collected on behalf of a
governmental entity to be deposited to the credit of the general revenue
fund of the state or of the local governmental entity, as appropriate.
Requires the court to apportion awards between the state and local
government entities when applicable.
Sec. 2259.016. LIMITATIONS. Requires an action, subject to Subsection
(b), to be brought not later than the third anniversary of the date on
which the violation was discovered by certain governmental authorities or
persons. Prohibits an action from being brought after the 10th
anniversary of the date on which the violation was committed.
Sec. 2259.017. APPLICATION OF LAW GOVERNING EXEMPLARY DAMAGES. Provides
that Chapter 41, Civil Practice and Remedies Code, does not apply to
exemplary damages awarded under Section 2259.011 or to the civil penalty
awarded under Section 2259.012.
SUBCHAPTER C. ATTORNEY GENERAL ACTION
Sec. 2259.021. ATTORNEY GENERAL INVESTIGATION. Requires the attorney
general to investigate alleged violations of Section 2259.002 involving
state funds. Allows the attorney general, if the attorney general finds
that a person has violated Section 2259.002, to bring an action under
Subchapter B against the person.
Sec. 2259.022. AFFECTED LOCAL GOVERNMENTAL ENTITY. Requires the attorney
general, in an action under Subchapter B involving local as well as state
funds, to provide a copy of the complaint to the appropriate prosecuting
authority, and the prosecuting authority is allowed to intervene in the
action.
SUBCHAPTER D. ACTION BROUGHT BY PROSECUTING AUTHORITY
Sec. 2259.031. PROSECUTING AUTHORITY INVESTIGATION. Requires a
prosecuting authority to investigate alleged violations of Section
2259.002 involving funds belonging to a local governmental entity and
allows the prosecuting authority to bring an action.
Sec. 2259.032. ATTORNEY GENERAL. Requires the prosecuting authority to
provide a copy of the complaint to the attorney general, if the claim
involves both state and local funds as specified. Requires the attorney
general to notify the court of certain information after receiving the
copy of the complaint. Allows the prosecuting authority to continue as a
party in the action, and to conduct the action, if the attorney general
declines to assume primary responsibility.
SUBCHAPTER E. PRIVATE CAUSE OF ACTION
Sec. 2259.041. PRIVATE ACTION. Allows a person to bring a civil action
for a violation of Section 2259.002, in the name of the person and the
state, or local government, as appropriate. (Qui tam)
Sec. 2259.042. SERVICE OF PETITION. Requires a person who brings an
action to serve a copy of the petition in the action on certain persons
and in a specified manner.
Sec. 2259.043. INTERVENTION. Allows the attorney general or the
prosecuting authority to assume responsibility for prosecution depending
on whether the action involves state funds, local funds, or both. Allows
the attorney general or prosecuting authority to enter an appearance and
proceed as a party in the action, or enter an appearance, as specified.
Sec. 2259.044. RIGHTS OF PARTIES IF GOVERNMENT PROSECUTES ACTION. The
attorney general or prosecuting authority, as appropriate, has primary
responsibility for prosecuting, and is not bound by an act of the person
commencing the action. The person has the right to continue as a party
subject to the limitations set forth in this section.
Sec. 2259.045. AWARD TO PRIVATE PARTY IF GOVERNMENT PROSECUTES ACTION.
Requires the court to award 10-25% of the settlement or judgment to the
person who brought the action, except as provided in Subsection (c), if
the appropriate government entity prosecutes the action. Requires the
court to consider the value of the information or evidence the person
disclosed. Allows the court to award up to 7% in certain situations.
Sec. 2259.046. AWARD TO PRIVATE PARTY IF GOVERNMENT DOES NOT PROSECUTE
ACTION. Requires the court to award 25-30% of the settlement or judgment
and reasonable expenses to the person who prosecuted the action.
Sec. 2259.047. REDUCTION OF AWARD. Allows the court to reduce the share
of the settlement or judgment the person would otherwise receive, if the
person was involved in the violation. Requires the court to dismiss the
person from the civil action, so that the person may not receive any share
of the settlement or judgment, if the person is convicted of criminal
conduct relating to the violation.
Sec. 2259.048. AWARD TO DEFENDANT FOR FRIVOLOUS ACTION OR ACTION BROUGHT
FOR PURPOSES OF HARASSMENT. Allows the court to award
reasonable attorney's fees and expenses to the defendant under certain
circumstances. The attorney may be liable as well as the person bringing
the action.
Sec. 2259.049. CERTAIN ACTIONS BARRED. Prohibits a person from bringing
an action based on allegations or transactions already subject to another
proceeding or investigation as specified, or from the news media,
unless the person is the original source. Defines "original
source."
SUBCHAPTER F. INTERFERENCE WITH DISCLOSURE BY EMPLOYEES
Sec. 2259.051. RIGHT TO DISCLOSE INFORMATION AND PARTICIPATE IN ACTION.
Sets forth the terms by which a person is entitled to disclose certain
information and participate in certain actions regarding an alleged
violation of Section 2259.002 or an action filed or to be filed under this
chapter.
Sec. 2259.052. PROHIBITED CONDUCT BY EMPLOYER. Prohibits an employer
from adopting or enforcing a rule or policy that prevents an employee from
exercising the employee's rights under Section 2259.051, or
discriminating against an employee because the employee has exercised the
employee's rights under Section 2259.051. Provides that an employer who
violates Subsection (a) is liable to the employee for certain damages and
costs. Prohibits an employee from recovering under Subsection (b) unless
certain conditions are met. Provides that this section does not apply to
an employer who is subject to Chapter 554, Government Code.
(b) This section applies to actions commenced on or after the effective
date without regard to when the act on which the action is based occurred.
ARTICLE 8. WAIVERS; EFFECTIVE DATE; EMERGENCY
SECTION 8.01. WAIVERS. Requires a state agency that determines that a
waiver or authorization from a federal agency is necessary, to request
such waiver or authorization, and allows the state agency to delay
implementation of the provision until it has received a waiver or
authorization.
SECTION 8.02. Effective date is September 1, 1997, except as otherwise
provided by this Act.
SECTION 8.03. Emergency clause.
COMPARISON OF ORIGINAL TO SUBSTITUTE
ARTICLE 1
SECTION 1.06. Sec. 531.103. INTERAGENCY COORDINATION. CSSB 30 is the
same as SB 30 except that rather than have a subsection (d), (e), and (f),
SB 30 has this language all under (d). In addition, CSSB 30 states "the
commission and the office of the attorney general may not assess.."
whereas the original states "shall not assess..". Also CSSB 30 refers to
"a case of fraud" and SB 30 "cases."
ARTICLE 2
SECTION 2.01. AUTHORIZATION FOR AMBULANCE SERVICES. CSSB 30 includes "or
other responsible party" to list of persons required to obtain prior
approval for non-emergency ambulance transportation.
SECTION 2.02. DURABLE MEDICAL EQUIPMENT. Subparagraph (2) CSSB 30
changes "make a notation in the child's medical records..." to "maintain a
record of compliance ... in an appropriate location."
SECTION 2.06. PILOT PROGRAM; ON-SITE REVIEWS OF PROSPECTIVE PROVIDERS.
CSSB 30 refers to Health and Human Services Commission once and
thereafter uses "commission." SB 30 uses Health and Human Services
Commission throughout the section.
SECTION 2.07. DEVELOPMENT OF NEW PROVIDER CONTRACT. CSSB 30 changes
Health and Human Services Commission to "commission" and adds language to
Subsection (c) to allow the Texas Department of Health greater flexibility
in tightening its provider enrollment process.
SECTION 2.09. REVIEW OF SERVICE PROVIDER BILLING PRACTICES. CSSB 30
includes "other health care provider services" in list of entities to be
reviewed.
ARTICLE 3
SECTION 3.01. Sec. 32.039. DAMAGES AND PENALTIES. CSSB 30 adds
Subsection (D) to broaden potential violations under this section. CSSB
30 makes nonsubstantive changes in Subsection (c)(2)(A) and (B), and
Subsection (u), clarifying the definitions of elderly and disabled.
ARTICLE 4
SECTION 4.08. Sec. 36.104. CSSB 30 changes heading to "STATE'S DECISION
TO CONTINUE ACTION" and deletes Subsection (b) requiring the court to
dismiss the action if the state declines to continue the action. This
change allows the person bringing the action to continue the action even
if the state decides not to pursue it.
SECTION 4.08. New Sec. 36.108. RIGHTS OF PARTIES IF STATE DOES NOT
CONTINUE ACTION is included in CSSB 30 and not in SB 30 because the Senate
version does not permit a private cause of action to continue unless the
OAG intervenes. This addition also results in a redesignation of the
remaining sections of this article.
SECTION 4.08. Sec. 36.109. STAY OF CERTAIN DISCOVERY. CSSB 30 is the
same as the original version (Sec. 36.108), except the substitute includes
"Regardless of whether the state proceeds with the action..." to allow for
the continuation of the private cause of action.
SECTION 4.08. Sec. 36.111. AWARD TO PRIVATE PLAINTIFF. The original (Sec.
36.110) is changed by adding Subsection (c) and renumbering the remaining
Subsections. This additional language deals with awards when the state
declines to proceed, and the person continues successfully with the
action.
SECTION 4.08. Sec. 36.112. REDUCTION OF AWARD. CSSB 30 is the same as the
original version (Sec. 36.111), except the substitute begins "Regardless
of whether the state proceeds with the action..."
SECTION 4.08. Sec. 36.113. New heading: AWARD TO DEFENDANT FOR FRIVOLOUS
ACTION OR ACTION BROUGHT FOR PURPOSES OF HARASSMENT. Incorporates the
substance of original Sec. 36.112, and adds language regarding private
causes of action where OAG does not intervene, and the possibility of
holding the person's attorney liable.
SECTION 4.09. Sec. 36.132. REVOCATION OF LICENSES. CSSB 30 adds
Subsection (I) to
broaden the definition of "licensing authority."
ARTICLE 7
ARTICLE 7. GENERAL FALSE CLAIMS. CSSB 30 adds this Article to create a
private cause of action (Qui tam) for any fraudulent act committed against
a governmental entity or contractor. The original bill's Article 7
(Waivers, Effective Date, Emergency) is renumbered as Article 8.