75R8848 JSA-D                           

         By Berlanga                                           H.B. No. 1511

         Substitute the following for H.B. No. 1511:

         By Berlanga                                       C.S.H.B. No. 1511

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the administration and allocation of Medicaid and other

 1-3     funds used to pay for graduate medical education.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Subchapter B, Chapter 32, Human Resources Code,

 1-6     is amended by adding Section 32.0315 to read as follows:

 1-7           Sec. 32.0315.  FUNDS FOR GRADUATE MEDICAL EDUCATION.

 1-8     (a)  The department shall establish procedures and formulas for the

 1-9     allocation of federal medical assistance funds that are directed to

1-10     be used to support graduate medical education in connection with

1-11     the medical assistance program.

1-12           (b)  The department shall allocate the funds in the manner

1-13     the department determines most effectively and equitably achieves

1-14     the purposes for which those federal funds are received, consistent

1-15     with the needs of this state for graduate medical education and the

1-16     training of resident physicians in accredited residency programs in

1-17     appropriate fields and specialties, taking into account other money

1-18     available to support graduate medical education.  In determining

1-19     the needs of this state for graduate medical education, the

1-20     department shall give emphasis to graduate medical education in

1-21     primary care specialties.

1-22           (c)  The department shall consult with the Texas Higher

1-23     Education Coordinating Board before adopting or revising a formula

1-24     under this section.  At the request of the department, the

 2-1     coordinating board shall provide the department with any

 2-2     information the board possesses to assist the department in

 2-3     administering this section.

 2-4           (d)  The department shall reimburse each teaching hospital

 2-5     under this section using the following formula:

 2-7     where:

 2-8           "R" is the annual amount to be reimbursed;

 2-9           "GME" is the hospital's annual cost of training resident

2-10     physicians for the fiscal year;

2-11           "P" is the number of resident physicians for the fiscal year;

2-12           "WNP" is the weighted number of full-time equivalent resident

2-13     physicians trained by the hospital during the fiscal year and

2-14     reported on its Medicaid cost report, adjusted to count each

2-15     full-time equivalent resident in primary care as 1.2 residents and

2-16     each other full-time equivalent resident as 1.0 residents;

2-17           "MD" means the number of patient days for the hospital for

2-18     the fiscal year that are attributable to Medicaid patients; and

2-19           "TD" means the total number of patient days for the hospital

2-20     for the fiscal year.

2-21           (d-1)  For purposes of the calculation under Subsection (d)

2-22     made to determine the amount of reimbursement for a teaching

2-23     hospital for the state fiscal year ending August 31, 1998, WNR

2-24     shall be calculated counting each full-time equivalent resident in

2-25     primary care as 1.0 residents and each other full-time equivalent

2-26     resident as 1.0 residents, and a teaching hospital's average annual

2-27     cost for training residents shall be determined using current cost

 3-1     reports for the hospital.  This subsection expires January 1, 1999.

 3-2           (e)  To determine a teaching hospital's average annual cost

 3-3     for training residents for purposes of this section, the department

 3-4     may use the most recent Medicaid cost report submitted to the

 3-5     department by the hospital, or may establish alternative procedures

 3-6     to determine that cost.

 3-7           (f)  The department shall make payments under this section in

 3-8     equal monthly installments, except that the department may make

 3-9     adjustments in any payment or make additional payments as necessary

3-10     to ensure that each teaching hospital or other entity receives the

3-11     appropriate annual amount under this section.

3-12           (g)  For purposes of this section, primary care means a field

3-13     or specialty described by Section 58.008(a), Education Code.

3-14           (h)  Notwithstanding Subsections (d) and (e), each teaching

3-15     hospital that received federal medical assistance funds for

3-16     training residents in the state fiscal year ending August 31, 1995,

3-17     shall receive an amount under this section that is:

3-18                 (1)  for the state fiscal year ending August 31, 1999,

3-19     not less than 90 percent of the amount of those funds the hospital

3-20     would have received in that fiscal year under the formulas used to

3-21     determine the amount of federal medical assistance funds for

3-22     training residents the hospital received in that 1995 fiscal year;

3-23                 (2)  for the state fiscal year ending August 31, 2000,

3-24     not less than 85 percent of the amount of those funds the hospital

3-25     would have received in that fiscal year under the formulas used to

3-26     determine the amount of federal medical assistance funds for

3-27     training residents the hospital received in that 1995 fiscal year;

 4-1                 (3)  for the state fiscal year ending August 31, 2001,

 4-2     not less than 80 percent of the amount of those funds the hospital

 4-3     would have received in that fiscal year under the formulas used to

 4-4     determine the amount of federal medical assistance funds for

 4-5     training residents the hospital received in that 1995 fiscal year;

 4-6     and

 4-7                 (4)  for the state fiscal year ending August 31, 2002,

 4-8     not less than 75 percent of the amount of those funds the hospital

 4-9     would have received in that fiscal year under the formulas used to

4-10     determine the amount of federal medical assistance funds for

4-11     training residents the hospital received in that 1995 fiscal year.

4-12           SECTION 2.  Subchapter C, Chapter 61, Education Code, is

4-13     amended by adding Section 61.0594 to read as follows:

4-14           Sec. 61.0594.  COORDINATED FUNDING OF GRADUATE MEDICAL

4-15     EDUCATION.  (a)  The board shall administer a program to support

4-16     graduate medical education programs in this state consistent with

4-17     the needs of this state for graduate medical education and the

4-18     training of resident physicians in accredited residency programs in

4-19     appropriate fields and specialties, including primary care

4-20     specialties described by Section 58.008(a).

4-21           (b)  From money available to the program, the board may make

4-22     grants or formula distributions to:

4-23                 (1)  support appropriate graduate medical education

4-24     programs and activities for which adequate funds are not otherwise

4-25     available; or

4-26                 (2)  foster new or expanded graduate medical education

4-27     programs or activities that the board determines will address the

 5-1     state's needs for graduate medical education.

 5-2           (c)  In making grants and distributions under this section,

 5-3     the board shall give consideration to the costs incurred by medical

 5-4     schools or other entities to support faculty responsible for the

 5-5     education or supervision of resident physicians in accredited

 5-6     graduate medical education programs, including programs in

 5-7     osteopathic medical education.

 5-8           (d)  The program is funded by appropriations, by gifts,

 5-9     grants, and donations made to support the program, and by any other

5-10     funds the board obtains, including federal funds, for the program.

5-11     From program funds, the comptroller of public accounts shall issue

5-12     warrants to each institution or other entity determined by the

5-13     board as eligible to receive a grant or distribution from the

5-14     program in the amount certified by the board.  An amount granted to

5-15     an institution or other entity under the program may be used only

5-16     to cover expenses of training residents of the particular program

5-17     or activity for which the award is made in accordance with any

5-18     conditions imposed by the board and may not otherwise be expended

5-19     for the general support of the institution or entity.

5-20           (e)  The board shall appoint an advisory committee to advise

5-21     the board regarding the development and administration of the

5-22     program, including considering requests for program grants and

5-23     establishing formulas for distribution of money under the program.

5-24     The advisory committee shall consist of:

5-25                 (1)  the executive director of the Texas State Board of

5-26     Medical Examiners or the executive director's designee;

5-27                 (2)  the chair of the Family Practice Residency

 6-1     Advisory Committee or the chair's designee;

 6-2                 (3)  the chair of the Primary Care Residency Advisory

 6-3     Committee or the chair's designee; and

 6-4                 (4)  the following members appointed by the board:

 6-5                       (A)  one representative of a teaching hospital

 6-6     affiliated with a Texas medical school;

 6-7                       (B)  one representative of a teaching hospital

 6-8     not affiliated with a Texas medical school;

 6-9                       (C)  two representatives of medical schools, one

6-10     representing a medical school in The University of Texas System and

6-11     one representing a medical school not in The University of Texas

6-12     System;

6-13                       (D)  two physicians active in private practice,

6-14     one of whom must be a generalist;

6-15                       (E)  one doctor of osteopathic medicine active in

6-16     private practice;

6-17                       (F)  one representative of an entity providing

6-18     managed health care;

6-19                       (G)  two clinical faculty members, one of whom

6-20     must be a generalist;

6-21                       (H)  one resident physician, who is a nonvoting

6-22     member; and

6-23                       (I)  one medical student, who is a nonvoting

6-24     member.

6-25           (f)  The appointed advisory committee members serve staggered

6-26     three-year terms.  The board shall make the initial committee

6-27     appointments to terms of one, two, and three years as necessary so

 7-1     that one-third of the appointed members' terms expire each year, as

 7-2     nearly as practicable.  The committee shall elect one of its

 7-3     members as presiding officer for a term of one year.  The committee

 7-4     shall meet at least once each year at the times requested by the

 7-5     board or set by the presiding officer of the committee.

 7-6           (g)  The advisory committee shall:

 7-7                 (1)  review applications for funding of graduate

 7-8     medical education programs under this section and make

 7-9     recommendations for approval or disapproval of those applications;

7-10                 (2)  make recommendations relating to the standards and

7-11     criteria used for consideration and approval of grants or for the

7-12     development of formulas for distribution of funding under this

7-13     section;

7-14                 (3)  recommend to the board an allocation of funds

7-15     among medical schools, teaching hospitals, and other entities that

7-16     may receive funds under this section; and

7-17                 (4)  perform other duties assigned by the board.

7-18           SECTION 3.  (a)  This Act takes effect September 1, 1997.

7-19           (b)  Section 32.0315, Human Resources Code, as added by this

7-20     Act, applies to the distribution of federal medical assistance

7-21     funds for the support of graduate medical education received on or

7-22     after the effective date of this Act, and to any such federal funds

7-23     received before the effective date of this Act that have not been

7-24     promised, obligated, or otherwise identified for distribution to

7-25     specific entities before the effective date.

7-26           SECTION 4.  The importance of this legislation and the

7-27     crowded condition of the calendars in both houses create an

 8-1     emergency and an imperative public necessity that the

 8-2     constitutional rule requiring bills to be read on three several

 8-3     days in each house be suspended, and this rule is hereby suspended.