By Coleman, Naishtat H.B. No. 3258
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the implementation of the Medicaid managed care
1-3 program.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 531.021, Government Code, is amended to
1-6 read as follows:
1-7 Sec. 531.021. ADMINISTRATION OF MEDICAID PROGRAM. (a) The
1-8 commission is the state agency designated to administer federal
1-9 medical assistance funds.
1-10 (b) The commission is responsible for the policy,
1-11 administration, evaluation, and operation of the Medicaid managed
1-12 care program.
1-13 (c) In discharging its duties relating to the Medicaid
1-14 managed care program, the commission shall consult with and
1-15 consider input from the advisory committee created under Section
1-16 531.047 and from each health and human services agency that
1-17 operates part of the Medicaid program.
1-18 (d) The commissioner or a person designated by the
1-19 commissioner shall supervise employees of health and human services
1-20 agencies in the performance of Medicaid managed care duties. The
1-21 commissioner or person designated by the commissioner may assign
1-22 duties to employees and require health and human services agencies
1-23 to assign duties to employees as necessary for the commission to
1-24 discharge its duties relating to the Medicaid managed care program.
2-1 SECTION 2. Subchapter B, Chapter 531, Government Code, is
2-2 amended by adding Section 531.047 to read as follows:
2-3 Sec. 531.047. MEDICAID MANAGED CARE INTERAGENCY ADVISORY
2-4 COMMITTEE. (a) An interagency advisory committee is created to
2-5 provide assistance and recommendations to the commission relating
2-6 to the policy, administration, evaluation, and operation of the
2-7 Medicaid managed care program. The advisory committee consists of:
2-8 (1) the commissioner or, if designated under
2-9 Subsection (b), the person acting as the state Medicaid director;
2-10 (2) a representative of the Texas Department of
2-11 Health, designated by the commissioner of public health;
2-12 (3) a representative of the Texas Department of Mental
2-13 Health and Mental Retardation, designated by the commissioner of
2-14 mental health and mental retardation;
2-15 (4) a representative of the Texas Department of Human
2-16 Services, designated by the commissioner of human services; and
2-17 (5) if considered appropriate by the commissioner, a
2-18 representative of any other state agency with duties relating to
2-19 the Medicaid managed care program, designated by the chief
2-20 administrative officer of that agency.
2-21 (b) The commissioner may designate the person acting as the
2-22 state Medicaid director to serve on the advisory committee on
2-23 behalf of the commissioner.
2-24 (c) A member of the advisory committee serves at the will of
2-25 the designating agency.
2-26 (d) The commissioner or the person acting as the state
2-27 Medicaid director, as applicable, serves as presiding officer of
3-1 the advisory committee, and members of the committee may elect
3-2 other necessary officers.
3-3 (e) The advisory committee shall meet at the call of the
3-4 presiding officer. The presiding officer shall call a meeting of
3-5 the committee at least once every two months.
3-6 (f) The designating agency is responsible for the expenses
3-7 of a member's service on the advisory committee. A member of the
3-8 advisory committee receives no additional compensation for serving
3-9 on the committee.
3-10 (g) The advisory committee is not subject to Article
3-11 6252-33, Revised Statutes.
3-12 SECTION 3. Subtitle I, Title 4, Government Code, is amended
3-13 by adding Chapter 533 to read as follows:
3-14 CHAPTER 533. IMPLEMENTATION OF MEDICAID
3-15 MANAGED CARE PROGRAM
3-16 SUBCHAPTER A. GENERAL PROVISIONS
3-17 Sec. 533.001. DEFINITIONS. In this chapter:
3-18 (1) "Commission" means the Health and Human Services
3-19 Commission or an agency operating part of the state Medicaid
3-20 managed care program, as appropriate.
3-21 (2) "Commissioner" means the commissioner of health
3-22 and human services.
3-23 (3) "Health and human services agencies" has the
3-24 meaning assigned by Section 531.001.
3-25 (4) "Managed care organization" means a person who is
3-26 authorized or otherwise permitted by law to arrange for or provide
3-27 a managed care plan.
4-1 (5) "Managed care plan" means a plan under which a
4-2 person undertakes to provide, arrange for, pay for, or reimburse
4-3 any part of the cost of any health care services. A part of the
4-4 plan must consist of arranging for or providing health care
4-5 services as distinguished from indemnification against the cost of
4-6 those services on a prepaid basis through insurance or otherwise.
4-7 The term includes a primary care case management provider network.
4-8 The term does not include a plan that indemnifies a person for the
4-9 cost of health care services through insurance.
4-10 (6) "Recipient" means a recipient of medical
4-11 assistance under Chapter 32, Human Resources Code.
4-12 Sec. 533.002. PURPOSE. The commission shall implement the
4-13 Medicaid managed care program as part of the health care delivery
4-14 system developed under Chapter 532 by contracting with managed care
4-15 organizations in a manner that, to the extent possible:
4-16 (1) improves the health of Texans by:
4-17 (A) emphasizing prevention;
4-18 (B) promoting continuity of care; and
4-19 (C) providing a medical home for recipients;
4-20 (2) ensures that each recipient receives high quality,
4-21 comprehensive health care services in the recipient's local
4-22 community;
4-23 (3) encourages the training of and access to primary
4-24 care physicians and providers;
4-25 (4) maximizes cooperation with existing public health
4-26 entities, including local departments of health;
4-27 (5) provides incentives to managed care organizations,
5-1 other than managed care organizations created by political
5-2 subdivisions with constitutional or statutory obligations to
5-3 provide health care to indigent patients, to improve the quality of
5-4 health care services for recipients by providing value-added
5-5 services; and
5-6 (6) reduces administrative and other nonfinancial
5-7 barriers for recipients in obtaining health care services.
5-8 Sec. 533.003. CONSIDERATIONS IN AWARDING CONTRACTS. In
5-9 awarding contracts to managed care organizations, the commission
5-10 shall:
5-11 (1) give extra consideration to organizations that
5-12 agree to assure continuity of care for at least three months beyond
5-13 the period of Medicaid eligibility for recipients; and
5-14 (2) consider the need to use different managed care
5-15 plans to meet the needs of different populations.
5-16 Sec. 533.004. MANDATORY CONTRACTS. (a) In implementing
5-17 Medicaid managed care in a health care service region, the
5-18 commission shall contract with at least one managed care
5-19 organization in that region that:
5-20 (1) is created by:
5-21 (A) a political subdivision with a
5-22 constitutional or statutory obligation to provide health care to
5-23 indigent patients; or
5-24 (B) a nonprofit corporation that has a contract,
5-25 agreement, or other arrangement with a political subdivision
5-26 described by Paragraph (A) under which the nonprofit corporation
5-27 assumes that political subdivision's obligation to provide health
6-1 care to indigent patients and leases, manages, or operates a
6-2 hospital facility owned by that political subdivision;
6-3 (2) is licensed to provide health care in that region;
6-4 and
6-5 (3) demonstrates its ability to meet the contractual
6-6 obligations delineated in the commission's request for applications
6-7 to enter into a contract with the commission to provide health care
6-8 to recipients in that region.
6-9 (b) A contract with a managed care organization described in
6-10 Subsection (a) must contain the same requirements and capitation
6-11 rate as contracts with other managed care organizations to provide
6-12 health care services to recipients in that region.
6-13 (c) If a political subdivision described in Subsection
6-14 (a)(1)(A) has entered into an agreement with the state to provide
6-15 funds for the expansion of Medicaid for children as authorized by
6-16 Chapter 444, Acts of the 74th Legislature, Regular Session, 1995,
6-17 the commission may not contract with a managed care organization
6-18 described by Subsection (a)(1) unless the political subdivision
6-19 fulfills its obligation under the agreement to provide those funds.
6-20 The commission shall make the provision of those funds under the
6-21 agreement a condition of the continuation of the contract with the
6-22 managed care organization for the organization to provide health
6-23 care services to recipients.
6-24 (d) Subsection (c) does not apply if:
6-25 (1) the commission does not expand Medicaid for
6-26 children as authorized by Chapter 444, Acts of the 74th
6-27 Legislature, Regular Session, 1995; or
7-1 (2) a waiver from a federal agency necessary for the
7-2 expansion is not granted.
7-3 Sec. 533.005. REQUIRED CONTRACT PROVISIONS. A contract
7-4 between a managed care organization and the commission for the
7-5 organization to provide health care services to recipients must
7-6 contain:
7-7 (1) procedures to ensure accountability to the state
7-8 for the provision of health care services, including procedures for
7-9 financial reporting, quality assurance, utilization review, and
7-10 assurance of contract and subcontract compliance;
7-11 (2) capitation and provider payment rates that ensure
7-12 the cost-effective provision of high quality health care;
7-13 (3) a requirement that the managed care organization
7-14 provide ready access to a person who assists recipients in
7-15 resolving issues relating to enrollment, plan administration,
7-16 education and training, access to services, and grievance
7-17 procedures;
7-18 (4) a requirement that the managed care organization
7-19 provide ready access to a person who assists providers in resolving
7-20 issues relating to payment, plan administration, education and
7-21 training, and grievance procedures;
7-22 (5) a requirement that the managed care organization
7-23 provide information and referral about the availability of
7-24 educational, social, and other community services that could
7-25 benefit a recipient;
7-26 (6) procedures for recipient outreach and education;
7-27 and
8-1 (7) a requirement that the managed care organization
8-2 make payment to a physician or provider for health care services
8-3 rendered to a recipient under a managed care plan not later than
8-4 the 45th day after the date a claim for payment is received with
8-5 documentation reasonably necessary for the managed care
8-6 organization to process the claim, or within a period, not to
8-7 exceed 60 days, specified by a written agreement between the
8-8 physician or provider and the managed care organization.
8-9 Sec. 533.006. PROVIDER NETWORKS. (a) The commission shall
8-10 require that each managed care organization that contracts with the
8-11 commission to provide health care services to recipients in a
8-12 region:
8-13 (1) seek participation in the organization's provider
8-14 network from:
8-15 (A) each health care provider in the region who
8-16 has traditionally provided care to Medicaid and charity care
8-17 recipients; and
8-18 (B) each hospital in the region that has been
8-19 designated as a disproportionate share hospital under the state
8-20 Medicaid program; and
8-21 (2) include in its provider network for not less than
8-22 three years:
8-23 (A) each health care provider in the region who:
8-24 (i) previously provided care to Medicaid
8-25 and charity care recipients at a significant level as prescribed by
8-26 the commission;
8-27 (ii) agrees to accept the prevailing
9-1 provider contract rate of the managed care organization; and
9-2 (iii) has the credentials required by the
9-3 managed care organization, provided that lack of board
9-4 certification or accreditation by the Joint Commission on
9-5 Accreditation of Healthcare Organizations may not be the sole
9-6 ground for exclusion from the provider network;
9-7 (B) each accredited primary care residency
9-8 program in the region; and
9-9 (C) each disproportionate share hospital
9-10 designated by the commission as a statewide significant traditional
9-11 provider.
9-12 (b) A contract between a managed care organization and the
9-13 commission for the organization to provide health care services to
9-14 recipients in a health care service region that includes a rural
9-15 area must require that the organization include in its provider
9-16 network rural hospitals, physicians, home and community support
9-17 services agencies, and other rural health care providers who:
9-18 (1) are sole community providers;
9-19 (2) provide care to Medicaid and charity care
9-20 recipients at a significant level as prescribed by the commission;
9-21 (3) agree to accept the prevailing provider contract
9-22 rate of the managed care organization; and
9-23 (4) have the credentials required by the managed care
9-24 organization, provided that lack of board certification or
9-25 accreditation by the Joint Commission on Accreditation of
9-26 Healthcare Organizations may not be the sole ground for exclusion
9-27 from the provider network.
10-1 Sec. 533.007. CONTRACT COMPLIANCE. (a) The commission
10-2 shall review each managed care organization that contracts with the
10-3 commission to provide health care services to recipients through a
10-4 managed care plan issued by the organization to determine whether
10-5 the organization is prepared to meet its contractual obligations.
10-6 (b) Each managed care organization that contracts with the
10-7 commission to provide health care services to recipients in a
10-8 health care service region shall submit an implementation plan not
10-9 later than the 90th day before the date on which the commission
10-10 plans to begin to provide health care services to recipients in
10-11 that region through managed care. The implementation plan must
10-12 include:
10-13 (1) specific staffing patterns by function for all
10-14 operations, including enrollment, information systems, member
10-15 services, quality improvement, claims management, case management,
10-16 and provider and recipient training; and
10-17 (2) specific time frames for demonstrating
10-18 preparedness for implementation before the date on which the
10-19 commission plans to begin to provide health care services to
10-20 recipients in that region through managed care.
10-21 (c) The commission shall respond to an implementation plan
10-22 not later than the fifth day after the date a managed care
10-23 organization submits the plan if the plan does not adequately meet
10-24 preparedness guidelines.
10-25 (d) Each managed care organization that contracts with the
10-26 commission to provide health care services to recipients in a
10-27 region shall submit status reports on the implementation plan not
11-1 later than the 60th day and the 30th day before the date on which
11-2 the commission plans to begin to provide health care services to
11-3 recipients in that region through managed care and every 30th day
11-4 after that date until the 180th day after that date.
11-5 (e) The commission shall conduct a compliance and readiness
11-6 review of each managed care organization that contracts with the
11-7 commission not later than the 15th day before the date on which the
11-8 commission plans to begin the enrollment process in a region and
11-9 again not later than the 15th day before the date on which the
11-10 commission plans to begin to provide health care services to
11-11 recipients in that region through managed care. The review must
11-12 include an on-site inspection and tests of service authorization
11-13 and claims payment systems, complaint processing systems, and any
11-14 other process or system required by the contract.
11-15 (f) The commission may delay enrollment of recipients in a
11-16 managed care plan issued by a managed care organization if the
11-17 review reveals that the managed care organization is not prepared
11-18 to meet its contractual obligations. The commission shall notify a
11-19 managed care organization of a decision to delay enrollment in a
11-20 plan issued by that organization.
11-21 Sec. 533.008. MARKETING GUIDELINES. The commission shall
11-22 establish marketing guidelines for managed care organizations that
11-23 contract with the commission to provide health care services to
11-24 recipients, including guidelines that prohibit:
11-25 (1) door-to-door marketing to recipients by managed
11-26 care organizations or agents of those organizations;
11-27 (2) the use of marketing materials with inaccurate or
12-1 misleading information;
12-2 (3) misrepresentations to recipients or providers;
12-3 (4) offering recipients material or financial
12-4 incentives to choose a managed care plan other than nominal gifts
12-5 or free health screenings approved by the commission that the
12-6 managed care organization offers to all recipients regardless of
12-7 whether the recipients enroll in the managed care plan;
12-8 (5) marketing at public assistance offices; and
12-9 (6) the use of marketing agents who are paid solely by
12-10 commission.
12-11 Sec. 533.009. SPECIAL DISEASE MANAGEMENT. (a) The
12-12 commission shall, to the extent possible, ensure that managed care
12-13 organizations under contract with the commission to provide health
12-14 care services to recipients develop special disease management
12-15 programs to address chronic health conditions, including asthma and
12-16 diabetes.
12-17 (b) The commission may study, in conjunction with an
12-18 academic center, the benefits and costs of applying disease
12-19 management principles in the delivery of Medicaid managed care.
12-20 Sec. 533.010. SPECIAL PROTOCOLS. In conjunction with an
12-21 academic center, the commission may study the treatment of indigent
12-22 populations to develop special protocols for managed care
12-23 organizations to use in providing health care services to
12-24 recipients.
12-25 (Sections 533.011-533.020 reserved for expansion
12-26 SUBCHAPTER B. REGIONAL ADVISORY COMMITTEES
12-27 Sec. 533.021. APPOINTMENT. Not later than the 180th day
13-1 before the date the commission plans to begin to provide health
13-2 care services to recipients in a health care service region through
13-3 managed care, the commission, in consultation with health and human
13-4 services agencies, shall appoint a Medicaid managed care advisory
13-5 committee for that region.
13-6 Sec. 533.022. COMPOSITION. A committee consists of
13-7 representatives from entities and communities in the region as
13-8 considered necessary by the commission to ensure representation of
13-9 interested persons, including representatives of:
13-10 (1) hospitals;
13-11 (2) managed care organizations;
13-12 (3) primary care providers;
13-13 (4) state agencies;
13-14 (5) consumer advocates;
13-15 (6) recipients; and
13-16 (7) rural providers.
13-17 Sec. 533.023. PRESIDING OFFICER; SUBCOMMITTEES. The
13-18 commissioner or the commissioner's designated representative serves
13-19 as the presiding officer of a committee. The presiding officer may
13-20 appoint subcommittees as necessary.
13-21 Sec. 533.024. MEETINGS. (a) A committee shall meet at
13-22 least quarterly for the first year after appointment of the
13-23 committee and at least annually after that time.
13-24 (b) A committee is subject to Chapter 551, Government Code.
13-25 Sec. 533.025. POWERS AND DUTIES. A committee shall:
13-26 (1) comment on the implementation of Medicaid managed
13-27 care in the region;
14-1 (2) provide recommendations to the commission on the
14-2 improvement of Medicaid managed care in the region not later than
14-3 the 30th day after the date of each committee meeting; and
14-4 (3) seek input from the public, including public
14-5 comment at each committee meeting.
14-6 Sec. 533.026. INFORMATION FROM COMMISSION. On request, the
14-7 commission shall provide to a committee information relating to
14-8 recipient enrollment and disenrollment, recipient and provider
14-9 complaints, administrative procedures, program expenditures, and
14-10 education and training procedures.
14-11 Sec. 533.027. COMPENSATION; REIMBURSEMENT. (a) A member of
14-12 a committee other than a representative of a health and human
14-13 services agency is not entitled to receive compensation or
14-14 reimbursement for travel expenses.
14-15 (b) A member of a committee who is an agency representative
14-16 is entitled to reimbursement for expenses incurred in the
14-17 performance of committee duties by the appointing agency in
14-18 accordance with the travel provisions for state employees in the
14-19 General Appropriations Act.
14-20 Sec. 533.028. OTHER LAW. Except as provided by this
14-21 chapter, a committee is subject to Article 6252-33, Revised
14-22 Statutes.
14-23 SECTION 4. Not later than September 1, 1997, the Health and
14-24 Human Services Commission shall direct the Texas Department of
14-25 Health and the Texas Department of Human Services to submit to the
14-26 governor and the Legislative Budget Board a plan to realize cost
14-27 savings for the state by simplifying eligibility criteria and
15-1 streamlining eligibility determination processes for recipients of
15-2 financial assistance under Chapter 31, Human Resources Code,
15-3 recipients of medical assistance under Chapter 32, Human Resources
15-4 Code, and recipients of other public assistance.
15-5 SECTION 5. Not later than December 1, 1998, the Health and
15-6 Human Services Commission shall submit a report to the governor,
15-7 the lieutenant governor, and the speaker of the house of
15-8 representatives on the impact of Medicaid managed care on the
15-9 public health sector.
15-10 SECTION 6. Not later than the first anniversary of the date
15-11 on which Medicaid recipients in a health care service region begin
15-12 to receive health care services through Medicaid managed care, the
15-13 Health and Human Services Commission, in cooperation with the
15-14 Medicaid managed care advisory committee for that region created
15-15 under Subchapter B, Chapter 533, Government Code, as added by this
15-16 Act, shall submit a report to the governor, lieutenant governor,
15-17 and speaker of the house of representatives on the implementation
15-18 of Medicaid managed care in that region. If Medicaid recipients in
15-19 a region began to receive health care services through managed care
15-20 before September 1, 1996, the commission is required to submit a
15-21 report on the implementation of Medicaid managed care in that
15-22 region as soon as possible after the effective date of this Act.
15-23 The commission may consolidate a report with any other report
15-24 relating to the same subject that the commission is required to
15-25 submit under other law.
15-26 SECTION 7. (a) Section 533.007, Government Code, as added
15-27 by this Act, applies only to a contract with a managed care
16-1 organization that the commission enters into or renews on or after
16-2 the effective date of this Act. A contract with a managed care
16-3 organization that the commission enters into or renews before the
16-4 effective date of this Act is governed by the law as it existed
16-5 immediately before that date, and that law is continued in effect
16-6 for that purpose.
16-7 (b) Section 533.004, Government Code, as added by this Act,
16-8 does not affect the expansion of medical assistance for children
16-9 described in H.C.R. No. 189, 75th Legislature, Regular Session,
16-10 1997.
16-11 (c) If Medicaid recipients in a health care service region
16-12 began to receive health care services through managed care before
16-13 the effective date of this Act, the commission shall appoint a
16-14 Medicaid managed care advisory committee for that region in
16-15 accordance with Subchapter B, Chapter 533, Government Code, as
16-16 added by this Act, as soon as possible after the effective date of
16-17 this Act.
16-18 (d) For purposes of this section, "commission" means the
16-19 Health and Human Services Commission or an agency operating part of
16-20 the state Medicaid managed care program, as appropriate.
16-21 SECTION 8. The importance of this legislation and the
16-22 crowded condition of the calendars in both houses create an
16-23 emergency and an imperative public necessity that the
16-24 constitutional rule requiring bills to be read on three several
16-25 days in each house be suspended, and this rule is hereby suspended,
16-26 and that this Act take effect and be in force from and after its
16-27 passage, and it is so enacted.