1-1 AN ACT
1-2 relating to certain community centers.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Sections 534.001(c) and (f), Health and Safety
1-5 Code, are amended to read as follows:
1-6 (c) A community center is:
1-7 (1) an agency of the state, a governmental unit, and a
1-8 unit of local government, as defined and specified by Chapters 101
1-9 and 102, Civil Practice and Remedies Code; [and]
1-10 (2) a local government, as defined by Section 791.003,
1-11 Government Code;
1-12 (3) a local government for the purposes of Chapter
1-13 1084, Acts of the 70th Legislature, Regular Session, 1987 (Article
1-14 715c, Vernon's Texas Civil Statutes); and
1-15 (4) a political subdivision for the purposes of
1-16 Chapter 172, Local Government Code.
1-17 (f) Each function performed by a community center under this
1-18 title is a governmental function if the function is required or
1-19 affirmatively approved by any statute of this state or of the
1-20 United States or by a regulatory agency of this state or of the
1-21 United States duly acting under any constitutional or statutory
1-22 authority vesting the agency with such power. Notwithstanding any
1-23 other law, a community center is subject to Chapter 554, Government
1-24 Code.
2-1 SECTION 2. Chapter 534, Health and Safety Code, is amended
2-2 by adding Subchapter C to read as follows:
2-3 SUBCHAPTER C. HEALTH MAINTENANCE ORGANIZATIONS
2-4 Sec. 534.101. HEALTH MAINTENANCE ORGANIZATION CERTIFICATE OF
2-5 AUTHORITY. (a) One or more community centers may create or
2-6 operate a nonprofit corporation pursuant to the laws of this state
2-7 for the purpose of accepting capitated or other at-risk payment
2-8 arrangements for the provision of services designated in a plan
2-9 approved by the department under Subchapter A.
2-10 (b) Before a nonprofit corporation organized or operating
2-11 under Subsection (a) accepts or enters into any capitated or other
2-12 at-risk payment arrangement for services designated in a plan
2-13 approved by the department under Subchapter A, the nonprofit
2-14 corporation must obtain the appropriate certificate of authority
2-15 from the Texas Department of Insurance to operate as a health
2-16 maintenance organization pursuant to the Texas Health Maintenance
2-17 Organization Act (Chapter 20A, Vernon's Texas Insurance Code).
2-18 (c) Before submitting any bids, a nonprofit corporation
2-19 operating under this subchapter shall disclose in writing to the
2-20 department the services to be provided by the community center
2-21 through any capitated or other at-risk payment arrangement by the
2-22 nonprofit corporation. The department shall verify that the
2-23 services provided under any capitated or other at-risk payment
2-24 arrangement are within the scope of services approved by the
2-25 department in each community center's plan required under
2-26 Subchapter A.
2-27 (d) The board shall:
3-1 (1) provide for public notice of the nonprofit
3-2 corporation's intent to submit a bid to provide or arrange services
3-3 through a capitated or other at-risk payment arrangement through
3-4 placement as a board agenda item on the next regularly scheduled
3-5 board meeting that allows at least 15 days' public review of the
3-6 plan; and
3-7 (2) provide an opportunity for public comment on the
3-8 services to be provided through such arrangements and on the
3-9 consideration of local input into the plan.
3-10 (e) The nonprofit corporation shall provide:
3-11 (1) public notice before verification and disclosure
3-12 of services to be provided by the community center through any
3-13 capitated or other at-risk payment arrangements by the nonprofit
3-14 corporation;
3-15 (2) an opportunity for public comment on the community
3-16 center services within the capitated or other at-risk payment
3-17 arrangements offered by the nonprofit corporation;
3-18 (3) published summaries of all relevant documentation
3-19 concerning community center services arranged through the nonprofit
3-20 corporation, including summaries of any similar contracts the
3-21 nonprofit corporation has entered into; and
3-22 (4) public access and review of all relevant
3-23 documentation.
3-24 (f) A nonprofit corporation operating under this subchapter:
3-25 (1) is subject to the requirements of Chapters 551 and
3-26 552, Government Code;
3-27 (2) shall solicit public input on the operations of
4-1 the nonprofit corporation and allow public access to information on
4-2 the operations, including services, administration, governance,
4-3 revenues, and expenses, on request unless disclosure is expressly
4-4 prohibited by law or the information is confidential under law; and
4-5 (3) shall publish an annual report detailing the
4-6 services, administration, governance, revenues, and expenses of the
4-7 nonprofit corporation, including the disposition of any excess
4-8 revenues.
4-9 Sec. 534.102. LAWS AND RULES. A nonprofit corporation
4-10 created or operated under this subchapter that obtains and holds a
4-11 valid certificate of authority as a health maintenance organization
4-12 may exercise the powers and authority and is subject to the
4-13 conditions and limitations provided by this subchapter, the Texas
4-14 Health Maintenance Organization Act (Chapter 20A, Vernon's Texas
4-15 Insurance Code), the Texas Non-Profit Corporation Act (Article
4-16 1396-1.01 et seq., Vernon's Texas Civil Statutes), and rules of the
4-17 Texas Department of Insurance.
4-18 Sec. 534.103. APPLICATION OF LAWS AND RULES. A health
4-19 maintenance organization created and operating under this
4-20 subchapter is governed as, and is subject to the same laws and
4-21 rules of the Texas Department of Insurance as, any other health
4-22 maintenance organization of the same type. The commissioner of
4-23 insurance may adopt rules as necessary to accept funding sources
4-24 other than the sources specified by Section 13, Texas Health
4-25 Maintenance Organization Act (Article 20A.13, Vernon's Texas
4-26 Insurance Code), from a nonprofit health maintenance organization
4-27 created and operating under this subchapter, to meet the minimum
5-1 surplus requirements of that section.
5-2 Sec. 534.104. APPLICATION OF SPECIFIC LAWS. (a) A
5-3 nonprofit health maintenance organization created under Section
5-4 534.101 is a health care provider that is a nonprofit health
5-5 maintenance organization created and operated by a community center
5-6 for purposes of Section 84.007(e), Civil Practice and Remedies
5-7 Code. The nonprofit health maintenance organization is not a
5-8 governmental unit or a unit of local government, for purposes of
5-9 Chapters 101 and 102, Civil Practice and Remedies Code,
5-10 respectively, or a local government for purposes of Chapter 791,
5-11 Government Code.
5-12 (b) Nothing in this subchapter precludes one or more
5-13 community centers from forming a nonprofit corporation under
5-14 Section 5.01, Medical Practice Act (Article 4495b, Vernon's Texas
5-15 Civil Statutes), to provide services on a risk-sharing or capitated
5-16 basis as permitted under Article 21.52F, Insurance Code.
5-17 Sec. 534.105. CONSIDERATION OF BIDS. The department shall
5-18 give equal consideration to bids submitted by any entity, whether
5-19 it be public, for-profit, or nonprofit, if the department accepts
5-20 bids to provide services through a capitated or at-risk payment
5-21 arrangement and if the entities meet all other criteria as required
5-22 by the department.
5-23 SECTION 3. Section 84.007(e), Civil Practice and Remedies
5-24 Code, is amended to read as follows:
5-25 (e) Sections 84.005 and 84.006 of this chapter do not apply
5-26 to a health care provider as defined in the Medical Liability and
5-27 Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
6-1 Civil Statutes), unless the provider is a federally funded migrant
6-2 or community health center under the Public Health Service Act (42
6-3 U.S.C.A. Sections 254(b) and (c)) or is a nonprofit health
6-4 maintenance organization created and operated by a community center
6-5 under Section 534.101, Health and Safety Code, or unless the
6-6 provider usually provides discounted services at or below costs
6-7 based on the ability of the beneficiary to pay. Acceptance of
6-8 Medicare or Medicaid payments will not disqualify a health care
6-9 provider under this section. In no event shall Sections 84.005 and
6-10 84.006 of this chapter apply to a general hospital or special
6-11 hospital as defined in Chapter 241, Health and Safety Code, or a
6-12 facility or institution licensed under Subtitle C, Title 7, Health
6-13 and Safety Code, or Chapter 242, Health and Safety Code, or to any
6-14 health maintenance organization created and operating under the
6-15 Texas Health Maintenance Organization Act (Chapter 20A, Vernon's
6-16 Texas Insurance Code), except for a nonprofit health maintenance
6-17 organization created under Section 534.101, Health and Safety Code.
6-18 SECTION 4. The Texas Department of Insurance shall adopt
6-19 rules by September 1, 1997, that describe the procedures an entity
6-20 must follow and the standards an entity must meet to obtain a
6-21 certificate of authority as a single health care service plan
6-22 providing behavioral health care services.
6-23 SECTION 5. This Act takes effect September 1, 1997.
6-24 SECTION 6. The importance of this legislation and the
6-25 crowded condition of the calendars in both houses create an
6-26 emergency and an imperative public necessity that the
6-27 constitutional rule requiring bills to be read on three several
7-1 days in each house be suspended, and this rule is hereby suspended.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 587 was passed by the House on April
25, 1997, by a non-record vote; and that the House concurred in
Senate amendments to H.B. No. 587 on May 25, 1997, by a non-record
vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 587 was passed by the Senate, with
amendments, on May 23, 1997, by a viva-voce vote.
_______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor