By: Zaffirini, Moncrief S.B. No. 30
Nelson
A BILL TO BE ENTITLED
AN ACT
1-1 relating to fraud and improper payments under the state Medicaid
1-2 program and other welfare programs; to the creation of private
1-3 cause of action for false claims for certain government payments;
1-4 and to the creation of a criminal offense; providing penalties.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 ARTICLE 1. GENERAL PROVISIONS RELATING TO WELFARE AGENCIES
1-7 SECTION 1.01. COLLECTION OF FOOD STAMP AND FINANCIAL
1-8 ASSISTANCE PAYMENTS MADE IN ERROR. (a) Chapter 22, Human
1-9 Resources Code, is amended by adding Sections 22.0251 through
1-10 22.0254 to read as follows:
1-11 Sec. 22.0251. TIMELY DETERMINATION OF OVERPAYMENTS.
1-12 (a) Subject to the approval of the commissioner of health and
1-13 human services, the department shall:
1-14 (1) determine and record the time taken by the
1-15 department to establish an overpayment claim in the food stamp
1-16 program or the program of financial assistance under Chapter 31;
1-17 (2) set progressive goals for reducing the time
1-18 described by Subdivision (1); and
1-19 (3) adopt a schedule to meet the goals set under
1-20 Subdivision (2).
1-21 (b) The department shall submit to the governor, the
1-22 Legislative Budget Board, and the Health and Human Services
1-23 Commission a semiannual report detailing the department's progress
2-1 in reaching its goals under Subsection (a)(2). The report may be
2-2 consolidated with any other report relating to the same subject
2-3 that the department is required to submit under other law.
2-4 Sec. 22.0252. TELEPHONE COLLECTION PROGRAM. (a) The
2-5 department shall use the telephone to attempt to collect
2-6 reimbursement from a person who receives a benefit granted in error
2-7 under the food stamp program or the program of financial assistance
2-8 under Chapter 31.
2-9 (b) The department shall submit to the governor, the
2-10 Legislative Budget Board, and the Health and Human Services
2-11 Commission a semiannual report on the operation and success of the
2-12 telephone collection program. The report may be consolidated with
2-13 any other report relating to the same subject that the department
2-14 is required to submit under other law.
2-15 Sec. 22.0253. PARTICIPATION IN FEDERAL TAX REFUND OFFSET
2-16 PROGRAM. The department shall participate in the Federal Tax
2-17 Refund Offset Program (FTROP) to attempt to recover benefits
2-18 granted by the department in error under the food stamp program.
2-19 The department shall submit as many claims that meet program
2-20 criteria as possible for offset against income tax returns.
2-21 Sec. 22.0254. PROSECUTION OF FRAUDULENT CLAIMS. (a) The
2-22 department shall keep a record of the dispositions of referrals
2-23 made by the department to a district attorney concerning fraudulent
2-24 claims for benefits under the food stamp program or the program of
2-25 financial assistance under Chapter 31.
3-1 (b) The department may:
3-2 (1) request status information biweekly from the
3-3 appropriate district attorney on each major fraudulent claim
3-4 referred by the department;
3-5 (2) request a written explanation from the appropriate
3-6 district attorney for each case referred in which the district
3-7 attorney declines to prosecute; and
3-8 (3) encourage the creation of a special welfare fraud
3-9 unit in each district attorney's office that serves a municipality
3-10 with a population of more than 250,000, to be financed by amounts
3-11 provided by the department.
3-12 (c) The department by rule may define what constitutes a
3-13 major fraudulent claim under Subsection (b)(1).
3-14 (b) Chapter 22, Human Resources Code, is amended by adding
3-15 Section 22.0291 to read as follows:
3-16 Sec. 22.0291. INFORMATION MATCHING SYSTEM RELATING TO
3-17 IMMIGRANTS AND FOREIGN VISITORS. (a) The department shall,
3-18 through the use of a computerized matching system, compare
3-19 department information relating to applicants for and recipients of
3-20 food stamps and financial assistance under Chapter 31 with
3-21 information obtained from the Department of State of the United
3-22 States and the United States Department of Justice relating to
3-23 immigrants and visitors to the United States for the purpose of
3-24 preventing individuals from unlawfully receiving public assistance
3-25 benefits administered by the department.
4-1 (b) The department may enter into an agreement with the
4-2 Department of State of the United States and the United States
4-3 Department of Justice as necessary to implement this section.
4-4 (c) The department and federal agencies sharing information
4-5 under this section shall protect the confidentiality of the shared
4-6 information in compliance with all existing state and federal
4-7 privacy guidelines.
4-8 (d) The department shall submit to the governor, the
4-9 Legislative Budget Board, and the Health and Human Services
4-10 Commission a semiannual report on the operation and success of the
4-11 information matching system required by this section. The report
4-12 may be consolidated with any other report relating to the same
4-13 subject matter the department is required to submit under other
4-14 law.
4-15 (c) Not later than January 1, 1998, the Texas Department of
4-16 Human Services shall begin operation of the telephone collection
4-17 program required by Section 22.0252, Human Resources Code, as added
4-18 by this section.
4-19 (d) Not later than January 1, 1998, the Texas Department of
4-20 Human Services shall submit the initial reports required by
4-21 Subsection (b), Section 22.0251 and Subsection (d), Section
4-22 22.0291, Human Resources Code, as added by this section.
4-23 (e) Not later than September 1, 1998, the Texas Department
4-24 of Human Services shall submit the initial report required by
4-25 Subsection (b), Section 22.0252, Human Resources Code, as added by
5-1 this section.
5-2 SECTION 1.02. USE OF EARNED FEDERAL FUNDS. Chapter 22,
5-3 Human Resources Code, is amended by adding Section 22.032 to read
5-4 as follows:
5-5 Sec. 22.032. USE OF EARNED FEDERAL FUNDS. Subject to the
5-6 General Appropriations Act, the department may use earned federal
5-7 funds derived from recovery of amounts paid or benefits granted by
5-8 the department as a result of fraud to pay the costs of the
5-9 department's activities relating to preventing fraud.
5-10 SECTION 1.03. PAYMENT OF MEDICAID CLAIMS. (a) Subchapter
5-11 B, Chapter 32, Human Resources Code, is amended by adding Sections
5-12 32.043 and 32.044 to read as follows:
5-13 Sec. 32.043. DUAL MEDICAID AND MEDICARE COVERAGE. (a) At
5-14 least annually the department shall identify each individual
5-15 receiving medical assistance under the medical assistance program
5-16 who is eligible to receive similar assistance under the Medicare
5-17 program.
5-18 (b) The department shall analyze claims submitted for
5-19 payment for a service provided under the medical assistance program
5-20 to an individual identified under Subsection (a) to ensure that
5-21 payment is sought first under the Medicare program to the extent
5-22 allowed by law.
5-23 Sec. 32.044. MISDIRECTED BILLING. To the extent authorized
5-24 by federal law, the department shall develop a procedure for the
5-25 state to:
6-1 (1) match claims for payment for medical assistance
6-2 provided under the medical assistance program against data
6-3 available from other entities, including the Veterans
6-4 Administration and nursing facilities, to determine alternative
6-5 responsibility for payment of the claims; and
6-6 (2) ensure that the appropriate entity bears the cost
6-7 of a claim.
6-8 (b) This section takes effect on the first date that it may
6-9 take effect under Section 39, Article III, Texas Constitution.
6-10 SECTION 1.04. ENHANCED MEDICAID REIMBURSEMENT.
6-11 (a) Subchapter B, Chapter 32, Human Resources Code, is amended by
6-12 adding Section 32.045 to read as follows:
6-13 Sec. 32.045. ENHANCED REIMBURSEMENT. The department shall
6-14 develop a procedure for:
6-15 (1) identifying each service provided under the
6-16 medical assistance program for which the state is eligible to
6-17 receive enhanced reimbursement of costs from the federal
6-18 government; and
6-19 (2) ensuring that the state seeks the highest level of
6-20 federal reimbursement available for each service provided.
6-21 (b) The Texas Department of Health shall identify services
6-22 provided under the state Medicaid program for the period beginning
6-23 December 31, 1989, and ending immediately before the effective date
6-24 of this section for which the state was eligible but did not
6-25 receive enhanced reimbursement of costs at a 90 percent rate from
7-1 the federal government. For that period, the department shall seek
7-2 from the federal government all reimbursements to which the state
7-3 is entitled.
7-4 (c) This section takes effect on the first date that it may
7-5 take effect under Section 39, Article III, Texas Constitution.
7-6 SECTION 1.05. MINIMUM COLLECTION GOAL. (a) Subchapter B,
7-7 Chapter 531, Government Code, is amended by adding Section 531.047
7-8 to read as follows:
7-9 Sec. 531.047. MINIMUM COLLECTION GOAL. (a) Before August
7-10 31 of each year, the commission by rule shall set a minimum goal
7-11 for the Texas Department of Human Services that specifies the
7-12 percentage of the amount of benefits granted by the department in
7-13 error under the food stamp program or the program of financial
7-14 assistance under Chapter 31, Human Resources Code, that the
7-15 department should recover. The commission shall set the percentage
7-16 based on comparable recovery rates reported by other states.
7-17 (b) If the department fails to meet the goal set under
7-18 Subsection (a) for the fiscal year, the commissioner shall notify
7-19 the comptroller, and the comptroller shall reduce the department's
7-20 general revenue appropriation by an amount equal to the difference
7-21 between the amount the department would have collected had the
7-22 department met the goal and the amount the department actually
7-23 collected.
7-24 (c) The commission, the governor, and the Legislative Budget
7-25 Board shall monitor the department's performance in meeting the
8-1 goal set under this section. The department shall cooperate by
8-2 providing to the commission, the governor, and the Legislative
8-3 Budget Board, on request, information concerning the department's
8-4 collection efforts.
8-5 (b) This section takes effect on the first date that it may
8-6 take effect under Section 39, Article III, Texas Constitution.
8-7 SECTION 1.06. COMMISSION POWERS AND DUTIES RELATING TO
8-8 WELFARE FRAUD. (a) Chapter 531, Government Code, is amended by
8-9 adding Subchapter C to read as follows:
8-10 SUBCHAPTER C. MEDICAID AND OTHER WELFARE FRAUD, ABUSE,
8-11 OR OVERCHARGES
8-12 Sec. 531.101. AWARD FOR REPORTING MEDICAID FRAUD, ABUSE, OR
8-13 OVERCHARGES. (a) The commission may grant an award to an
8-14 individual who reports activity that constitutes fraud or abuse of
8-15 funds in the state Medicaid program or reports overcharges in the
8-16 program if the commission determines that the disclosure results in
8-17 the recovery of an overcharge or in the termination of the
8-18 fraudulent activity or abuse of funds.
8-19 (b) The commission shall determine the amount of an award.
8-20 The award must be equal to not less than 10 percent of the savings
8-21 to this state that result from the individual's disclosure. In
8-22 determining the amount of the award, the commission shall consider
8-23 how important the disclosure is in ensuring the fiscal integrity of
8-24 the program.
8-25 (c) An award under this section is subject to appropriation.
9-1 The award must be paid from money appropriated to or otherwise
9-2 available to the commission, and additional money may not be
9-3 appropriated to the commission for the purpose of paying the award.
9-4 (d) Payment of an award under this section from federal
9-5 funds is subject to the permissible use under federal law of funds
9-6 for this purpose.
9-7 (e) A person who brings an action under Subchapter C,
9-8 Chapter 36, Human Resources Code, is not eligible for an award
9-9 under this section.
9-10 Sec. 531.102. INVESTIGATIONS AND ENFORCEMENT OFFICE.
9-11 (a) The commission, through the commission's office of
9-12 investigations and enforcement, is responsible for the
9-13 investigation of fraud in the provision of health and human
9-14 services and the enforcement of state law relating to the provision
9-15 of those services.
9-16 (b) The commission shall set clear objectives, priorities,
9-17 and performance standards for the office that emphasize:
9-18 (1) coordinating investigative efforts to aggressively
9-19 recover money;
9-20 (2) allocating resources to cases that have the
9-21 strongest supportive evidence and the greatest potential for
9-22 recovery of money; and
9-23 (3) maximizing opportunities for referral of cases to
9-24 the office of the attorney general.
9-25 (c) The commission shall train office staff to enable the
10-1 staff to pursue priority Medicaid and welfare fraud and abuse cases
10-2 as necessary.
10-3 (d) The commission may require employees of health and human
10-4 services agencies to provide assistance to the commission in
10-5 connection with the commission's duties relating to the
10-6 investigation of fraud in the provision of health and human
10-7 services.
10-8 Sec. 531.103. INTERAGENCY COORDINATION. (a) The commission
10-9 and the office of the attorney general shall enter into a
10-10 memorandum of understanding to develop and implement joint written
10-11 procedures for processing cases of suspected fraud, waste, or abuse
10-12 under the state Medicaid program. The memorandum of understanding
10-13 shall require:
10-14 (1) the commission and the office of the attorney
10-15 general to set priorities and guidelines for referring cases to
10-16 appropriate state agencies for investigation to enhance deterrence
10-17 of fraud, waste, or abuse in the program and maximize the
10-18 imposition of penalties, the recovery of money, and the successful
10-19 prosecution of cases;
10-20 (2) the commission to keep detailed records for cases
10-21 processed by the commission or the office of the attorney general,
10-22 including information on the total number of cases processed and,
10-23 for each case:
10-24 (A) the agency and division to which the case is
10-25 referred for investigation;
11-1 (B) the date on which the case is referred; and
11-2 (C) the nature of the suspected fraud, waste, or
11-3 abuse;
11-4 (3) the commission to notify each appropriate division
11-5 of the office of the attorney general of each case referred by the
11-6 commission;
11-7 (4) the office of the attorney general to ensure that
11-8 information relating to each case investigated by that office is
11-9 available to each division of the office with responsibility for
11-10 investigating suspected fraud, waste, or abuse;
11-11 (5) the office of the attorney general to notify the
11-12 commission of each case the attorney general declines to prosecute
11-13 or prosecutes unsuccessfully;
11-14 (6) representatives of the commission and of the
11-15 office of the attorney general to meet not less than quarterly to
11-16 share case information and determine the appropriate agency and
11-17 division to investigate each case; and
11-18 (7) the commission and the office of the attorney
11-19 general to submit information requested by the comptroller about
11-20 each resolved case for the comptroller's use in improving fraud
11-21 detection.
11-22 (b) An exchange of information under this section between
11-23 the office of the attorney general and the commission or a health
11-24 and human services agency does not affect whether the information
11-25 is subject to disclosure under Chapter 552, Government Code.
12-1 (c) The commission and the office of the attorney general
12-2 shall jointly prepare and submit a semiannual report to the
12-3 governor, lieutenant governor, and speaker of the house of
12-4 representatives concerning the activities of those agencies in
12-5 detecting and preventing fraud, waste, and abuse under the state
12-6 Medicaid program. The report may be consolidated with any other
12-7 report relating to the same subject matter the commission or office
12-8 of the attorney general is required to submit under other law.
12-9 (d) The commission and the office of the attorney general
12-10 shall not assess or collect investigation and attorney's fees on
12-11 behalf of any state agency unless the office of the attorney
12-12 general or other state agency collects a penalty, restitution, or
12-13 other reimbursement payment to the state. The commission shall
12-14 refer cases to the appropriate district attorney, county attorney,
12-15 city attorney, or private collection agency if the office of the
12-16 attorney general fails to act within 30 days of referral. A
12-17 failure by the attorney general to act within 30 days constitutes
12-18 approval by the attorney general under Section 2107.003. The
12-19 district attorney, county attorney, city attorney, or private
12-20 collection agency may collect costs associated with the case and 20
12-21 percent of the amount of the penalty, restitution, or other
12-22 reimbursement payment collected.
12-23 Sec. 531.104. ASSISTING INVESTIGATIONS BY ATTORNEY GENERAL.
12-24 (a) The commission and the attorney general shall execute a
12-25 memorandum of understanding under which the commission shall
13-1 provide investigative support as required to the attorney general
13-2 in connection with cases under Subchapter B, Chapter 36, Human
13-3 Resources Code. Under the memorandum of understanding, the
13-4 commission shall assist in performing preliminary investigations
13-5 and ongoing investigations for actions prosecuted by the attorney
13-6 general under Subchapter C, Chapter 36, Human Resources Code.
13-7 (b) The memorandum of understanding must provide that the
13-8 commission is not required to provide investigative support in more
13-9 than 100 open investigations in a fiscal year.
13-10 Sec. 531.105. FRAUD DETECTION TRAINING. (a) The commission
13-11 shall develop and implement a program to provide annual training to
13-12 contractors who process Medicaid claims and appropriate staff of
13-13 the Texas Department of Health and the Texas Department of Human
13-14 Services in identifying potential cases of fraud, waste, or abuse
13-15 under the state Medicaid program. The training provided to the
13-16 contractors and staff must include clear criteria that specify:
13-17 (1) the circumstances under which a person should
13-18 refer a potential case to the commission; and
13-19 (2) the time by which a referral should be made.
13-20 (b) The Texas Department of Health and the Texas Department
13-21 of Human Services, in cooperation with the commission, shall
13-22 periodically set a goal of the number of potential cases of fraud,
13-23 waste, or abuse under the state Medicaid program that each agency
13-24 will attempt to identify and refer to the commission. The
13-25 commission shall include information on the agencies' goals and the
14-1 success of each agency in meeting the agency's goal in the report
14-2 required by Section 531.103(c).
14-3 Sec. 531.106. LEARNING OR NEURAL NETWORK TECHNOLOGY.
14-4 (a) The commission shall use learning or neural network technology
14-5 to identify and deter fraud in the Medicaid program throughout this
14-6 state.
14-7 (b) The commission shall contract with a private or public
14-8 entity to develop and implement the technology. The commission may
14-9 require the entity it contracts with to install and operate the
14-10 technology at locations specified by the commission, including
14-11 commission offices.
14-12 (c) The data used for neural network processing shall be
14-13 maintained as an independent subset for security purposes.
14-14 (d) The commission shall require each health and human
14-15 services agency that performs any aspect of the state Medicaid
14-16 program to participate in the implementation and use of the
14-17 technology.
14-18 (e) The commission shall maintain all information necessary
14-19 to apply the technology to claims data covering a period of at
14-20 least two years.
14-21 (f) The commission shall refer cases identified by the
14-22 technology to the commission's office of investigations and
14-23 enforcement or the office of the attorney general, as appropriate.
14-24 Sec. 531.107. MEDICAID AND PUBLIC ASSISTANCE FRAUD OVERSIGHT
14-25 TASK FORCE. (a) The Medicaid and Public Assistance Fraud
15-1 Oversight Task Force advises and assists the commission and the
15-2 commission's office of investigations and enforcement in improving
15-3 the efficiency of fraud investigations and collections.
15-4 (b) The task force is composed of a representative of the:
15-5 (1) attorney general's office, appointed by the
15-6 attorney general;
15-7 (2) comptroller's office, appointed by the
15-8 comptroller;
15-9 (3) Department of Public Safety, appointed by the
15-10 public safety director;
15-11 (4) state auditor's office, appointed by the state
15-12 auditor;
15-13 (5) commission, appointed by the commissioner of
15-14 health and human services;
15-15 (6) Texas Department of Human Services, appointed by
15-16 the commissioner of human services; and
15-17 (7) Texas Department of Insurance, appointed by the
15-18 commissioner of insurance.
15-19 (c) The comptroller or the comptroller's designee serves as
15-20 the presiding officer of the task force. The task force may elect
15-21 any other necessary officers.
15-22 (d) The task force shall meet at least once each fiscal
15-23 quarter at the call of the presiding officer.
15-24 (e) The appointing agency is responsible for the expenses of
15-25 a member's service on the task force. Members of the task force
16-1 receive no additional compensation for serving on the task force.
16-2 (f) At least once each fiscal quarter, the commission's
16-3 office of investigations and enforcement shall provide to the task
16-4 force:
16-5 (1) information detailing:
16-6 (A) the number of fraud referrals made to the
16-7 office and the origin of each referral;
16-8 (B) the time spent investigating each case;
16-9 (C) the number of cases investigated each month,
16-10 by program and region;
16-11 (D) the dollar value of each fraud case that
16-12 results in a criminal conviction; and
16-13 (E) the number of cases the office rejects and
16-14 the reason for rejection, by region; and
16-15 (2) any additional information the task force
16-16 requires.
16-17 Sec. 531.108. FRAUD PREVENTION. (a) The commission's
16-18 office of investigations and enforcement shall compile and
16-19 disseminate accurate information and statistics relating to:
16-20 (1) fraud prevention; and
16-21 (2) post-fraud referrals received and accepted or
16-22 rejected from the commission's case management system or the case
16-23 management system of a health and human services agency.
16-24 (b) The commission shall:
16-25 (1) aggressively publicize successful fraud
17-1 prosecutions and fraud-prevention programs through all available
17-2 means, including the use of statewide press releases issued in
17-3 coordination with the Texas Department of Human Services; and
17-4 (2) ensure that a toll-free hotline for reporting
17-5 suspected fraud in programs administered by the commission or a
17-6 health and human services agency is maintained and promoted, either
17-7 by the commission or by a health and human services agency.
17-8 (c) The commission shall develop a cost-effective method of
17-9 identifying applicants for public assistance in counties bordering
17-10 other states and in metropolitan areas selected by the commission
17-11 who are already receiving benefits in other states. If
17-12 economically feasible, the commission may develop a computerized
17-13 matching system.
17-14 (d) The commission shall:
17-15 (1) verify automobile information that is used as
17-16 criteria for eligibility; and
17-17 (2) establish a computerized matching system with the
17-18 Texas Department of Criminal Justice to prevent an incarcerated
17-19 individual from illegally receiving public assistance benefits
17-20 administered by the commission.
17-21 (e) The commission shall submit to the governor and
17-22 Legislative Budget Board a semiannual report on the results of
17-23 computerized matching of commission information with information
17-24 from neighboring states, if any, and information from the Texas
17-25 Department of Criminal Justice. The report may be consolidated
18-1 with any other report relating to the same subject matter the
18-2 commission is required to submit under other law.
18-3 Sec. 531.109. DISPOSITION OF FUNDS. (a) The commission
18-4 shall deposit the state's share of money collected under this
18-5 subchapter in a special account in the state treasury.
18-6 (b) The commission may spend money in the account for the
18-7 administration of this subchapter, subject to the General
18-8 Appropriations Act.
18-9 (b) Subsection (c), Section 22.028, Human Resources Code, is
18-10 amended to read as follows:
18-11 (c) No later than the first day of each month, the
18-12 department shall send the comptroller a report listing the accounts
18-13 on which enforcement actions or other steps were taken by the
18-14 department in response to the records received from the EBT
18-15 operator under this section, and the action taken by the
18-16 department. The comptroller shall promptly review the report and,
18-17 as appropriate, may solicit the advice of the Medicaid and Public
18-18 Assistance Fraud Oversight Task Force regarding the results of the
18-19 department's enforcement actions.
18-20 (c) Section 531.104, Government Code, as added by this
18-21 section, takes effect only if the transfer of employees of the
18-22 Texas Department of Human Services and the Texas Department of
18-23 Health to the Health and Human Services Commission, as proposed by
18-24 Section 1.07 of this article, or similar legislation, is enacted by
18-25 the 75th Legislature in regular session and becomes law.
19-1 (d) Not later than January 1, 1998, the Health and Human
19-2 Services Commission shall award the contract for the learning or
19-3 neural network technology required by Section 531.106, Government
19-4 Code, as added by this section, and the contractor shall begin
19-5 operations not later than that date. If the commission fails to
19-6 award the contract or the contractor cannot begin operations on or
19-7 before January 1, 1998, the commissioner of health and human
19-8 services shall enter into an interagency agreement with the
19-9 comptroller to enable the comptroller to perform the duties
19-10 prescribed by Section 531.106. In addition to the interagency
19-11 agreement, the commissioner of health and human services and the
19-12 comptroller shall execute a memorandum of understanding to ensure
19-13 that the comptroller receives all data and resources necessary to
19-14 operate the learning or neural network technology system.
19-15 (e) Not later than April 1, 1998, the Health and Human
19-16 Services Commission shall submit the initial report required by
19-17 Subsection (e), Section 531.108, Government Code, as added by this
19-18 section.
19-19 (f) In addition to the substantive changes in law made by
19-20 this section, this section, in adding Section 531.101, Government
19-21 Code, conforms to a change in the law made by Section 1, Chapter
19-22 444, Acts of the 74th Legislature, 1995.
19-23 (g) Section 16G, Article 4413(502), Revised Statutes, as
19-24 added by Section 1, Chapter 444, Acts of the 74th Legislature,
19-25 1995, is repealed.
20-1 (h) To the extent of any conflict, this Act prevails over
20-2 another Act of the 75th Legislature, Regular Session, 1997,
20-3 relating to nonsubstantive additions to and corrections in enacted
20-4 codes.
20-5 (i) Sections 21.0145 and 22.027, Human Resources Code, are
20-6 repealed.
20-7 (j) Sections 531.102 and 531.106, Government Code, as added
20-8 by this section, take effect on the first date that those sections
20-9 may take effect under Section 39, Article III, Texas Constitution.
20-10 SECTION 1.07. CONSOLIDATION OF STAFF. (a) On September 1,
20-11 1997, or an earlier date provided by an interagency agreement with
20-12 the affected agencies:
20-13 (1) all powers, duties, functions, programs, and
20-14 activities performed by or assigned to the Texas Department of
20-15 Human Services' utilization and assessment review function
20-16 immediately before September 1, 1997, are transferred to the Health
20-17 and Human Services Commission;
20-18 (2) all funds, obligations, contracts, property, and
20-19 records of the Texas Department of Human Services' utilization and
20-20 assessment review function are transferred to the Health and Human
20-21 Services Commission; and
20-22 (3) all employees of the Texas Department of Human
20-23 Services responsible for the department's utilization and
20-24 assessment review function become employees of the Health and Human
20-25 Services Commission, to be assigned duties by the commissioner of
21-1 health and human services.
21-2 (b) On September 1, 1997, or an earlier date provided by an
21-3 interagency agreement with the affected agencies:
21-4 (1) all powers, duties, functions, programs, and
21-5 activities performed by or assigned to the Texas Department of
21-6 Health's claims review and analysis group and policy and data
21-7 analysis group immediately before September 1, 1997, are
21-8 transferred to the Health and Human Services Commission;
21-9 (2) all funds, obligations, contracts, property, and
21-10 records of the Texas Department of Health's claims review and
21-11 analysis group and policy and data analysis group are transferred
21-12 to the Health and Human Services Commission; and
21-13 (3) all employees of the Texas Department of Health's
21-14 claims review and analysis group and policy and data analysis group
21-15 become employees of the Health and Human Services Commission, to be
21-16 assigned duties by the commissioner of health and human services.
21-17 (c) A rule or form adopted by the Texas Department of Human
21-18 Services that relates to the utilization and assessment review
21-19 function or by the Texas Department of Health that relates to the
21-20 claims review and analysis group or the policy and data analysis
21-21 group is a rule or form of the Health and Human Services Commission
21-22 and remains in effect until altered by the commission. The
21-23 secretary of state is authorized to adopt rules as necessary to
21-24 expedite the implementation of this subsection.
21-25 (d) The commissioner of health and human services shall
22-1 oversee and assist in the transfer of powers, duties, functions,
22-2 programs, and activities prescribed by Subsections (a) and (b) of
22-3 this section.
22-4 (e) The commissioner of health and human services shall
22-5 determine for each power, duty, function, program, or activity
22-6 scheduled for transfer:
22-7 (1) the relevant agency actions that constitute each
22-8 power, duty, function, program, or activity;
22-9 (2) the relevant records, property, and equipment used
22-10 by a state agency for each power, duty, function, program, or
22-11 activity;
22-12 (3) the state agency employees whose duties directly
22-13 or indirectly involve a power, duty, function, program, or
22-14 activity; and
22-15 (4) state agency funds and obligations that are
22-16 related to the power, duty, function, program, or activity.
22-17 (f) Based on the determinations made under Subsection (e) of
22-18 this section, the commissioner of health and human services shall
22-19 assist the agencies in transferring powers, duties, functions,
22-20 programs, activities, records, equipment, property, funds,
22-21 obligations, and employees in accordance with the transfer
22-22 schedule.
22-23 (g) The commissioner of health and human services shall file
22-24 any federal plan changes required by this section.
22-25 (h) The transfer of powers, duties, functions, programs,
23-1 and activities under this section does not affect or impair any act
23-2 done, any obligation, right, order, license, permit, rule,
23-3 criterion, standard, or requirement existing, any investigation
23-4 begun, or any penalty accrued under former law, and that law
23-5 remains in effect for any action concerning those matters.
23-6 (i) An action brought or proceeding commenced before the
23-7 effective date of this section, including a contested case or a
23-8 remand of an action or proceeding by a reviewing court, is governed
23-9 by the law and rules applicable to the action or proceeding before
23-10 the effective date of this section.
23-11 (j) This section takes effect on the first date that it may
23-12 take effect under Section 39, Article III, Texas Constitution.
23-13 SECTION 1.08. USE OF PRIVATE COLLECTION AGENTS. (a) With
23-14 assistance from the Council on Competitive Government and subject
23-15 to approval by the attorney general under Section 2107.003,
23-16 Government Code, the Texas Department of Human Services shall, in
23-17 addition to other methods of collection, use private collection
23-18 agents to collect reimbursements for benefits granted by the
23-19 department in error under the food stamp program or the program of
23-20 financial assistance under Chapter 31, Human Resources Code.
23-21 (b) If approved by the attorney general, the Texas
23-22 Department of Human Services shall ensure that the collection
23-23 agents are engaged in collection work on behalf of the department
23-24 not later than March 1, 1998. The department shall strive to refer
23-25 approximately 20 percent of the department's claims for
24-1 reimbursement to the collection agents.
24-2 (c) On March 1, 1998, and September 1, 1998, the Texas
24-3 Department of Human Services shall submit a progress report to the
24-4 governor, the Legislative Budget Board, and the Health and Human
24-5 Services Commission on the department's efforts to use private
24-6 collection agents to collect reimbursements for erroneous benefits.
24-7 On March 1, 1999, the department shall submit to the governor, the
24-8 Legislative Budget Board, and the Health and Human Services
24-9 Commission a final report on the success of the private collection
24-10 effort.
24-11 (d) Unless otherwise directed by the 76th Legislature, the
24-12 Texas Department of Human Services shall evaluate the success of
24-13 the use of private collection agents to collect benefit
24-14 reimbursements and adjust the number of claims referred to the
24-15 agents, as appropriate.
24-16 SECTION 1.09. EXPEDITED FOOD STAMP DELIVERY; IMPACT ON
24-17 FRAUDULENT CLAIMS. (a) The Texas Department of Human Services
24-18 shall conduct a study to determine the impact of the one-day
24-19 screening and service delivery requirements prescribed by
24-20 Subsection (e), Section 33.002, Human Resources Code, on the level
24-21 of fraud in the food stamp program.
24-22 (b) Not later than January 1, 1999, the Texas Department of
24-23 Human Services shall submit to the governor, the Legislative Budget
24-24 Board, and the Health and Human Services Commission a report on the
24-25 results of the study. The report must include:
25-1 (1) detailed statistics by region on the number of
25-2 fraudulent claims linked to the one-day screening and service
25-3 delivery requirements; and
25-4 (2) recommendations on modifying the one-day screening
25-5 and service delivery requirements, as authorized by Subsection (g),
25-6 Section 33.002, Human Resources Code.
25-7 SECTION 1.10. STUDY ON COLLECTION OF ERRONEOUS FOOD STAMP OR
25-8 FINANCIAL ASSISTANCE BENEFITS THROUGH LIENS OR WAGE GARNISHMENT.
25-9 (a) The Texas Department of Human Services shall conduct a study
25-10 to determine the feasibility of collecting amounts of benefits
25-11 granted by the department in error under the food stamp program or
25-12 the program of financial assistance under Chapter 31, Human
25-13 Resources Code, by the garnishment of wages or the filing of liens
25-14 against property.
25-15 (b) Not later than March 1, 1999, the Texas Department of
25-16 Human Services shall submit to the governor, the Legislative Budget
25-17 Board, and the Health and Human Services Commission a report on the
25-18 results of the study.
25-19 SECTION 1.11. OPERATION RESTORE TRUST. (a) To the extent
25-20 authorized by law, the Health and Human Services Commission and the
25-21 Office of the Attorney General shall cooperate with entities in
25-22 other states that are participating in "Operation Restore Trust"
25-23 and share information regarding service providers excluded from the
25-24 state Medicaid program.
25-25 (b) In this section, "Operation Restore Trust" means the
26-1 federal program directed at detecting health-care fraud primarily
26-2 in home health care, nursing home care, and durable medical
26-3 equipment in certain states.
26-4 ARTICLE 2. MEDICAID SERVICE PROVIDERS
26-5 SECTION 2.01. AUTHORIZATION FOR AMBULANCE SERVICES.
26-6 (a) Section 32.024, Human Resources Code, is amended by adding
26-7 Subsection (t) to read as follows:
26-8 (t) The department by rule shall require a physician,
26-9 nursing facility, or other health care provider to obtain
26-10 authorization from the department or a person authorized to act on
26-11 behalf of the department before an ambulance is used to transport a
26-12 recipient of medical assistance under this chapter in circumstances
26-13 not involving an emergency. The rules must provide that:
26-14 (1) a request for authorization must be evaluated
26-15 based on the recipient's medical needs and may be granted for a
26-16 length of time appropriate to the recipient's medical condition;
26-17 (2) a response to a request for authorization must be
26-18 made not later than 48 hours after receipt of the request; and
26-19 (3) a person denied payment for services rendered
26-20 because of failure to obtain prior authorization or because a
26-21 request for prior authorization was denied is entitled to appeal
26-22 the denial of payment to the department.
26-23 (b) Not later than January 1, 1998, the Health and Human
26-24 Services Commission and each appropriate health and human services
26-25 agency that operates part of the state Medicaid program shall adopt
27-1 the rules required by Subsection (t), Section 32.024, Human
27-2 Resources Code, as added by this section.
27-3 (c) This section takes effect on the first date that it may
27-4 take effect under Section 39, Article III, Texas Constitution.
27-5 SECTION 2.02. DURABLE MEDICAL EQUIPMENT. (a) Section
27-6 32.024, Human Resources Code, is amended by adding Subsection (u)
27-7 to read as follows:
27-8 (u) The department by rule shall require a health care
27-9 provider who arranges for durable medical equipment for a child who
27-10 receives medical assistance under this chapter to:
27-11 (1) ensure that the child receives the equipment
27-12 prescribed, the equipment fits properly, if applicable, and the
27-13 child or the child's parent or guardian, as appropriate considering
27-14 the age of the child, receives instruction regarding the
27-15 equipment's use; and
27-16 (2) make a notation in the child's medical records of
27-17 the date on which the requirements of Subdivision (1) are met.
27-18 (b) Not later than January 1, 1998, the Health and Human
27-19 Services Commission and each appropriate health and human services
27-20 agency that operates part of the state Medicaid program shall adopt
27-21 the rules required by Subsection (u), Section 32.024, Human
27-22 Resources Code, as added by this section.
27-23 (c) This section takes effect on the first date that it may
27-24 take effect under Section 39, Article III, Texas Constitution.
27-25 SECTION 2.03. SURETY BOND. Subchapter B, Chapter 32, Human
28-1 Resources Code, is amended by adding Section 32.0321 to read as
28-2 follows:
28-3 Sec. 32.0321. SURETY BOND. (a) The department by rule may
28-4 require each provider of medical assistance in a provider type that
28-5 has demonstrated significant potential for fraud or abuse to file
28-6 with the department a surety bond in a reasonable amount.
28-7 (b) The bond must be payable to the department to compensate
28-8 the department for damages resulting from or penalties or fines
28-9 imposed in connection with an act of fraud or abuse committed by
28-10 the provider under the medical assistance program.
28-11 SECTION 2.04. CRIMINAL HISTORY INFORMATION. (a) Subchapter
28-12 B, Chapter 32, Human Resources Code, is amended by adding Section
28-13 32.0322 to read as follows:
28-14 Sec. 32.0322. CRIMINAL HISTORY RECORD INFORMATION. (a) The
28-15 department may obtain from any law enforcement or criminal justice
28-16 agency the criminal history record information that relates to a
28-17 provider under the medical assistance program or a person applying
28-18 to enroll as a provider under the medical assistance program.
28-19 (b) The department by rule shall establish criteria for
28-20 revoking a provider's enrollment or denying a person's application
28-21 to enroll as a provider under the medical assistance program based
28-22 on the results of a criminal history check.
28-23 (b) Subchapter F, Chapter 411, Government Code, is amended
28-24 by adding Section 411.132 to read as follows:
28-25 Sec. 411.132. ACCESS TO CRIMINAL HISTORY RECORD INFORMATION;
29-1 AGENCIES OPERATING PART OF MEDICAL ASSISTANCE PROGRAM. (a) The
29-2 Health and Human Services Commission or an agency operating part of
29-3 the medical assistance program under Chapter 32, Human Resources
29-4 Code, is entitled to obtain from the department the criminal
29-5 history record information maintained by the department that
29-6 relates to a provider under the medical assistance program or a
29-7 person applying to enroll as a provider under the medical
29-8 assistance program.
29-9 (b) Criminal history record information obtained by the
29-10 commission or an agency under Subsection (a) may not be released or
29-11 disclosed to any person except in a criminal proceeding, in an
29-12 administrative proceeding, on court order, or with the consent of
29-13 the provider or applicant.
29-14 SECTION 2.05. MANAGED CARE ORGANIZATIONS. (a) Section 16A,
29-15 Article 4413(502), Revised Statutes, is amended by amending
29-16 Subsection (n) and adding Subsections (o) through (t) to read as
29-17 follows:
29-18 (n) A managed care organization that contracts with the
29-19 state to provide or arrange to provide health care benefits or
29-20 services to Medicaid eligible individuals shall:
29-21 (1) report to the commission or the state's Medicaid
29-22 claims administrator, as appropriate, all information required by
29-23 commission rule, including information necessary to set rates,
29-24 detect fraud, neglect, and physical abuse, and ensure quality of
29-25 care;
30-1 (2) not later than 30 days after execution of the
30-2 contract, develop and submit to the operating agency for approval
30-3 by the commission a plan for preventing, detecting, and reporting
30-4 fraud and abuse that:
30-5 (A) conforms to guidelines developed by the
30-6 operating agency with assistance from the commission and the office
30-7 of the attorney general; and
30-8 (B) requires the managed care organization to
30-9 report any known or suspected act of fraud or abuse to the
30-10 operating agency for referral to the commission for investigation;
30-11 (3) include standard provisions developed by the
30-12 operating agency in each subcontract entered into by the managed
30-13 care organization that affects the delivery of or payment for
30-14 Medicaid services;
30-15 (4) submit to the commission for approval each
30-16 subcontract entered into by the managed care organization that
30-17 affects the delivery of or payment for Medicaid services; and
30-18 (5) submit annual disclosure statements to the
30-19 commission containing information on:
30-20 (A) the financial condition of the managed care
30-21 organization and each of its affiliates; and
30-22 (B) ownership interests in the managed care
30-23 organization or any of its affiliates.
30-24 (o) The operating agency shall require that each contract
30-25 between a managed care organization and the state to provide or
31-1 arrange to provide health care benefits or services to Medicaid
31-2 eligible individuals contain provisions:
31-3 (1) stating that information provided by a managed
31-4 care organization under this section may be used as necessary to
31-5 detect fraud and abuse;
31-6 (2) specifying the responsibilities of the managed
31-7 care organization in reducing fraud and abuse; and
31-8 (3) authorizing specific penalties for failure to
31-9 provide information required by commission rules.
31-10 (p) At least once every three years the operating agency
31-11 shall audit each managed care organization that contracts with the
31-12 state to provide or arrange to provide health care benefits or
31-13 services to Medicaid eligible individuals.
31-14 (q) A managed care organization audited under Subsection (p)
31-15 of this section is responsible for paying the costs of the audit.
31-16 The costs of the audit may be allowed as a credit against premium
31-17 taxes paid by the managed care organization, except as provided by
31-18 Section 2, Article 1.28, Insurance Code.
31-19 (r) The operating agency and the Texas Department of
31-20 Insurance shall enter into a memorandum of understanding to
31-21 coordinate audits of managed care organizations. The memorandum
31-22 shall:
31-23 (1) identify information required in an operating
31-24 agency audit that is not customarily required in a department
31-25 audit;
32-1 (2) encourage the department to include to the extent
32-2 possible information identified under Subdivision (1) of this
32-3 subsection in department audits;
32-4 (3) establish procedures for initiating and
32-5 distributing the findings of audits of a managed care organization;
32-6 (4) identify the records of physicians or Medicaid
32-7 eligible individuals that are served by managed care organizations,
32-8 that are subject to audit; and
32-9 (5) require that operating agency and department
32-10 personnel that audit a managed care organization receive specific
32-11 training in detecting Medicaid fraud and abuse.
32-12 (s) In this section, "operating agency" means the
32-13 appropriate health and human services agency operating part of the
32-14 state Medicaid program.
32-15 (t) This section expires September 1, 2001.
32-16 (b) Section 532.001, Government Code, as added by H.B. No.
32-17 1845 or S.B. No. 898, Acts of the 75th Legislature, Regular
32-18 Session, 1997, relating to nonsubstantive additions to and
32-19 corrections in enacted codes, is amended by adding Subdivision (5)
32-20 to read as follows:
32-21 (5) "Operating agency" means the appropriate health
32-22 and human services agency operating part of the state Medicaid
32-23 program.
32-24 (c) Subchapter B, Chapter 532, Government Code, as added by
32-25 H.B. No. 1845 or S.B. No. 898, Acts of the 75th Legislature,
33-1 Regular Session, 1997, relating to nonsubstantive additions to and
33-2 corrections in enacted codes, is amended by adding Sections 532.112
33-3 and 532.113 to read as follows:
33-4 Sec. 532.112. DUTIES OF MANAGED CARE ORGANIZATION;
33-5 CONTRACTUAL PROVISIONS. (a) A managed care organization that
33-6 contracts with the state to provide or arrange to provide health
33-7 care benefits or services to Medicaid eligible individuals shall:
33-8 (1) report to the commission or the state's Medicaid
33-9 claims administrator, as appropriate, all information required by
33-10 commission rule, including information necessary to set rates,
33-11 detect fraud, neglect, and physical abuse, and ensure quality of
33-12 care;
33-13 (2) not later than 30 days after execution of the
33-14 contract, develop and submit to the operating agency for approval
33-15 by the commission a plan for preventing, detecting, and reporting
33-16 fraud and abuse that:
33-17 (A) conforms to guidelines developed by the
33-18 operating agency with assistance from the commission and the office
33-19 of the attorney general; and
33-20 (B) requires the managed care organization to
33-21 report any known or suspected act of fraud or abuse to the
33-22 operating agency for referral to the commission for investigation;
33-23 (3) include standard provisions developed by the
33-24 operating agency in each subcontract entered into by the managed
33-25 care organization that affects the delivery of or payment for
34-1 Medicaid services;
34-2 (4) submit to the commission for approval each
34-3 subcontract entered into by the managed care organization that
34-4 affects the delivery of or payment for Medicaid services; and
34-5 (5) submit annual disclosure statements to the
34-6 commission containing information on:
34-7 (A) the financial condition of the managed care
34-8 organization and each of its affiliates; and
34-9 (B) ownership interests in the managed care
34-10 organization or any of its affiliates.
34-11 (b) The operating agency shall require that each contract
34-12 between a managed care organization and the state to provide or
34-13 arrange to provide health care benefits or services to Medicaid
34-14 eligible individuals contain provisions:
34-15 (1) stating that information provided by a managed
34-16 care organization under this section may be used as necessary to
34-17 detect fraud and abuse;
34-18 (2) specifying the responsibilities of the managed
34-19 care organization in reducing fraud and abuse; and
34-20 (3) authorizing specific penalties for failure to
34-21 provide information required by commission rules.
34-22 Sec. 532.113. AUDITS; MEMORANDUM OF UNDERSTANDING. (a) At
34-23 least once every three years the operating agency shall audit each
34-24 managed care organization that contracts with the state to provide
34-25 or arrange to provide health care benefits or services to Medicaid
35-1 eligible individuals.
35-2 (b) A managed care organization audited under Subsection (a)
35-3 is responsible for paying the costs of the audit. The costs of the
35-4 audit may be allowed as a credit against premium taxes paid by the
35-5 managed care organization, except as provided by Section 2, Article
35-6 1.28, Insurance Code.
35-7 (c) The operating agency and the Texas Department of
35-8 Insurance shall enter into a memorandum of understanding to
35-9 coordinate audits of managed care organizations. The memorandum
35-10 shall:
35-11 (1) identify information required in an operating
35-12 agency audit that is not customarily required in a department
35-13 audit;
35-14 (2) encourage the department to include to the extent
35-15 possible information identified under Subdivision (1) in department
35-16 audits;
35-17 (3) establish procedures for initiating and
35-18 distributing the findings of audits of a managed care organization;
35-19 (4) identify the records of physicians or Medicaid
35-20 eligible individuals that are served by managed care organizations
35-21 that are subject to audit; and
35-22 (5) require that operating agency and department
35-23 personnel that audit a managed care organization receive specific
35-24 training in detecting Medicaid fraud and abuse.
35-25 (d) Not later than November 1, 1997, the Texas Department of
36-1 Health or the appropriate health and human services agency
36-2 operating part of the state Medicaid program shall develop
36-3 guidelines applicable to a managed care organization's plan for
36-4 preventing, detecting, and reporting Medicaid fraud.
36-5 (e) Subdivision (2), Subsection (n), Section 16A, Article
36-6 4413(502), Revised Statutes, as amended by this section, or
36-7 Subdivision (2), Subsection (a), Section 532.112, Government Code,
36-8 as added by this section, depending on which provision takes
36-9 effect, applies only to a managed care organization that enters
36-10 into a contract or renews a contract on or after November 1, 1997,
36-11 with the state to provide or arrange to provide health care
36-12 benefits to Medicaid eligible individuals.
36-13 (f) This section applies only to a contract entered into or
36-14 renewed on or after the effective date of this section. A contract
36-15 entered into or renewed before the effective date of this section
36-16 is governed by the law in effect immediately before the effective
36-17 date of this section, and the former law is continued in effect for
36-18 that purpose.
36-19 (g) A managed care organization that contracts with the
36-20 state to provide or arrange to provide health care benefits to
36-21 Medicaid eligible individuals before the effective date of this
36-22 section is not required by this section to:
36-23 (1) include standard provisions developed by the state
36-24 in a subcontract executed before the effective date of this
36-25 section;
37-1 (2) submit a subcontract executed before the effective
37-2 date of this section to the commission for approval; or
37-3 (3) modify a contract between the managed care
37-4 organization and the state executed before the effective date of
37-5 this section.
37-6 (h) A managed care organization that renews a contract or
37-7 subcontract subject to this section after the effective date of
37-8 this section shall include in the renewed contract or subcontract
37-9 all provisions required to be included by this section.
37-10 (i) Subsection (a) of this section takes effect only if
37-11 neither H.B. No. 1845 nor S.B. No. 898, Acts of the 75th
37-12 Legislature, Regular Session, 1997, relating to nonsubstantive
37-13 additions to and corrections in enacted codes, take effect.
37-14 (j) Subsections (b) and (c) of this section take effect only
37-15 if H.B. No. 1845 or S.B. No. 898, Acts of the 75th Legislature,
37-16 Regular Session, 1997, relating to nonsubstantive additions to and
37-17 corrections in enacted codes, takes effect.
37-18 SECTION 2.06. PILOT PROGRAM; ON-SITE REVIEWS OF PROSPECTIVE
37-19 PROVIDERS. (a) The Health and Human Services Commission by rule
37-20 shall establish a pilot program to reduce fraud by conducting
37-21 random on-site reviews of persons who apply to provide health care
37-22 services under the state Medicaid program before authorizing those
37-23 persons to provide the services.
37-24 (b) The Health and Human Services Commission shall implement
37-25 the pilot program initially in not more than five or fewer than
38-1 three urban counties selected by the commission. The commission
38-2 shall select counties for the pilot program that:
38-3 (1) offer the greatest potential for achieving a
38-4 reduction of provider fraud; and
38-5 (2) contain established field offices of the
38-6 commission or the Texas Department of Human Services, as
38-7 appropriate.
38-8 (c) At a minimum, the pilot program shall provide for random
38-9 on-site reviews of durable medical equipment providers, home health
38-10 providers, therapists, and laboratories. The Health and Human
38-11 Services Commission may include other groups of providers in the
38-12 pilot program.
38-13 (d) The Health and Human Services Commission shall develop
38-14 questions to be used during an on-site review of a prospective
38-15 provider to verify that the provider has the ability to provide the
38-16 proposed services.
38-17 (e) The on-site reviews shall be conducted by personnel in
38-18 the appropriate field offices of the Health and Human Services
38-19 Commission or the Texas Department of Human Services.
38-20 (f) The Health and Human Services Commission may waive an
38-21 on-site review of a prospective provider if the provider has been
38-22 subject to a comparable review by a certifying body in the
38-23 preceding year.
38-24 (g) If the pilot program is successful in reducing provider
38-25 fraud in the counties initially selected under Subsection (b) of
39-1 this section, the Health and Human Services Commission may expand
39-2 the pilot program to include additional counties.
39-3 (h) Not later than January 15, 1999, the Health and Human
39-4 Services Commission shall submit to the governor and the
39-5 legislature a report concerning the effectiveness of the pilot
39-6 program that includes:
39-7 (1) the number of applications denied as a result of
39-8 an on-site review; and
39-9 (2) recommendations on expanding the pilot program.
39-10 (i) This section expires September 1, 1999.
39-11 SECTION 2.07. DEVELOPMENT OF NEW PROVIDER CONTRACT. (a) As
39-12 soon as possible after the effective date of this section, the
39-13 Health and Human Services Commission shall develop a new provider
39-14 contract for health care services that contains provisions designed
39-15 to strengthen the commission's ability to prevent provider fraud
39-16 under the state Medicaid program.
39-17 (b) In developing the new provider contract, the Health and
39-18 Human Services Commission shall solicit suggestions and comments
39-19 from representatives of providers in the state Medicaid program.
39-20 (c) As soon as possible after development of the new
39-21 provider contract, the Health and Human Services Commission and
39-22 each agency operating part of the state Medicaid program by rule
39-23 shall require each provider who enrolled in the program before the
39-24 effective date of this section to reenroll in the program under the
39-25 new contract. A provider must reenroll in the state Medicaid
40-1 program not later than September 1, 1999, to retain eligibility to
40-2 participate in the program.
40-3 SECTION 2.08. COMPETITIVE PROCESS FOR OBTAINING DURABLE
40-4 MEDICAL EQUIPMENT. (a) As soon as possible and not later than the
40-5 45th day after the effective date of this section:
40-6 (1) the Texas Department of Health shall develop a
40-7 process for selecting providers of durable medical equipment and
40-8 supplies that encourages competition; and
40-9 (2) the Health and Human Services Commission shall
40-10 submit an amendment to the state's Medicaid plan authorizing
40-11 implementation of the process developed by the Texas Department of
40-12 Health.
40-13 (b) This section takes effect on the first date that it may
40-14 take effect under Section 39, Article III, Texas Constitution.
40-15 SECTION 2.09. REVIEW OF SERVICE PROVIDER BILLING PRACTICES.
40-16 (a) The Texas Department of Health shall conduct an automated
40-17 review of physician, laboratory, and radiology services to identify
40-18 improper billing practices designed to inflate a service provider's
40-19 claim for payment for services provided under the state Medicaid
40-20 program.
40-21 (b) After completing the review required by Subsection (a)
40-22 of this section, the Texas Department of Health shall:
40-23 (1) refer each identified improper billing practice to
40-24 the Health and Human Services Commission's office of investigations
40-25 and enforcement; and
41-1 (2) require the entity that administers the state
41-2 Medicaid program on behalf of the department to modify the entity's
41-3 claims processing and monitoring procedures and computer technology
41-4 as necessary to prevent improper billing by service providers.
41-5 (c) This section takes effect on the first date that it may
41-6 take effect under Section 39, Article III, Texas Constitution.
41-7 ARTICLE 3. ADMINISTRATIVE PENALTIES AND SANCTIONS
41-8 RELATING TO MEDICAID FRAUD
41-9 SECTION 3.01. ADMINISTRATIVE PENALTIES. (a) Section
41-10 32.039, Human Resources Code, is amended to read as follows:
41-11 Sec. 32.039. [CIVIL] DAMAGES AND PENALTIES. (a) In this
41-12 section:
41-13 (1) "Claim" [, "claim"] means an application for
41-14 payment of health care services under Title XIX of the federal
41-15 Social Security Act that is submitted by a person who is under a
41-16 contract or provider agreement with the department.
41-17 (2) "Managed care organization" means any entity or
41-18 person that is authorized or otherwise permitted by law to arrange
41-19 for or provide a managed care plan.
41-20 (3) "Managed care plan" means a plan under which a
41-21 person undertakes to provide, arrange for, pay for, or reimburse
41-22 any part of the cost of any health care service. A part of the
41-23 plan must consist of arranging for or providing health care
41-24 services as distinguished from indemnification against the cost of
41-25 those services on a prepaid basis through insurance or otherwise.
42-1 The term does not include a plan that indemnifies a person for the
42-2 cost of health care services through insurance.
42-3 (b) A person commits a violation if the person:
42-4 (1) presents or causes to be presented to the
42-5 department a claim that contains a statement or representation the
42-6 person knows to be false; or
42-7 (2) is a managed care organization that contracts with
42-8 the department to provide or arrange to provide health care
42-9 benefits or services to individuals eligible for medical assistance
42-10 and:
42-11 (A) fails to provide to an individual a health
42-12 care benefit or service that the organization is required to
42-13 provide under the contract with the department;
42-14 (B) fails to provide to the department
42-15 information required to be provided by law, department rule, or
42-16 contractual provision; or
42-17 (C) engages in a fraudulent activity in
42-18 connection with the enrollment in the organization's managed care
42-19 plan of an individual eligible for medical assistance or in
42-20 connection with marketing the organization's services to an
42-21 individual eligible for medical assistance.
42-22 (c) [(b)] A person who commits a violation under Subsection
42-23 (b) [presents or causes to be presented to the department a claim
42-24 that contains a statement or representation the person knows to be
42-25 false] is liable to the department for:
43-1 (1) the amount paid, if any, as a result [because] of
43-2 the violation [false claim] and interest on that amount determined
43-3 at the rate provided by law for legal judgments and accruing from
43-4 the date on which the payment was made; and
43-5 (2) payment of an administrative [a civil] penalty of
43-6 an amount not to exceed twice the amount paid, if any, as a result
43-7 [because] of the violation, plus an amount:
43-8 (A) not less than $5,000 or more than $15,000
43-9 for each violation that results in injury to a person younger than
43-10 18 years of age or a person who is elderly or disabled; or
43-11 (B) not more than $10,000 for each violation
43-12 that does not result in injury to a person younger than 18 years of
43-13 age or a person who is elderly or disabled [false claim; and]
43-14 [(3) payment of a civil penalty of not more than
43-15 $2,000 for each item or service for which payment was claimed].
43-16 (d) [(c)] Unless the provider submitted information to the
43-17 department for use in preparing a voucher that the provider knew
43-18 was false or failed to correct information that the provider knew
43-19 was false when provided an opportunity to do so, this section does
43-20 not apply to a claim based on the voucher if the department
43-21 calculated and printed the amount of the claim on the voucher and
43-22 then submitted the voucher to the provider for the provider's
43-23 signature. In addition, the provider's signature on the voucher
43-24 does not constitute fraud. The department shall adopt rules that
43-25 establish a grace period during which errors contained in a voucher
44-1 prepared by the department may be corrected without penalty to the
44-2 provider.
44-3 (e) [(d)] In determining the amount of the penalty to be
44-4 assessed under Subsection (c)(2) [Subdivision (3) of Subsection (b)
44-5 of this section], the department shall consider:
44-6 (1) the seriousness of the violation;
44-7 (2) whether the person had previously committed a
44-8 violation [submitted false claims]; and
44-9 (3) the amount necessary to deter the person from
44-10 committing [submitting] future violations [false claims].
44-11 (f) [(e)] If after an examination of the facts the
44-12 department concludes that the person committed a violation [did
44-13 submit a false claim], the department may issue a preliminary
44-14 report stating the facts on which it based its conclusion,
44-15 recommending that an administrative [a civil] penalty under this
44-16 section be imposed and recommending the amount of the proposed
44-17 penalty.
44-18 (g) [(f)] The department shall give written notice of the
44-19 report to the person charged with committing the violation
44-20 [submitting the false claim]. The notice must include a brief
44-21 summary of the facts, a statement of the amount of the recommended
44-22 penalty, and a statement of the person's right to an informal
44-23 review of the alleged violation [false claim], the amount of the
44-24 penalty, or both the alleged violation [false claim] and the amount
44-25 of the penalty.
45-1 (h) [(g)] Not later than the 10th day after the date on
45-2 which the person charged with committing the violation [submitting
45-3 the false claim] receives the notice, the person may either give
45-4 the department written consent to the report, including the
45-5 recommended penalty, or make a written request for an informal
45-6 review by the department.
45-7 (i) [(h)] If the person charged with committing the
45-8 violation [submitting the false claim] consents to the penalty
45-9 recommended by the department or fails to timely request an
45-10 informal review, the department shall assess the penalty. The
45-11 department shall give the person written notice of its action. The
45-12 person shall pay the penalty not later than the 30th day after the
45-13 date on which the person receives the notice.
45-14 (j) [(i)] If the person charged with committing the
45-15 violation [submitting a false claim] requests an informal review as
45-16 provided by Subsection (h) [(g) of this section], the department
45-17 shall conduct the review. The department shall give the person
45-18 written notice of the results of the review.
45-19 (k) [(j)] Not later than the 10th day after the date on
45-20 which the person charged with committing the violation [submitting
45-21 the false claim] receives the notice prescribed by Subsection (j)
45-22 [(i) of this section], the person may make to the department a
45-23 written request for a hearing. The hearing must be conducted in
45-24 accordance with Chapter 2001, Government Code.
45-25 (l) [(k)] If, after informal review, a person who has been
46-1 ordered to pay a penalty fails to request a formal hearing in a
46-2 timely manner, the department shall assess the penalty. The
46-3 department shall give the person written notice of its action. The
46-4 person shall pay the penalty not later than the 30th day after the
46-5 date on which the person receives the notice.
46-6 (m) Within 30 days after the date on which the board's order
46-7 issued after a hearing under Subsection (k) becomes final as
46-8 provided by Section 2001.144, Government Code, the person shall:
46-9 (1) pay the amount of the penalty;
46-10 (2) pay the amount of the penalty and file a petition
46-11 for judicial review contesting the occurrence of the violation, the
46-12 amount of the penalty, or both the occurrence of the violation and
46-13 the amount of the penalty; or
46-14 (3) without paying the amount of the penalty, file a
46-15 petition for judicial review contesting the occurrence of the
46-16 violation, the amount of the penalty, or both the occurrence of the
46-17 violation and the amount of the penalty.
46-18 (n) A person who acts under Subsection (m)(3) within the
46-19 30-day period may:
46-20 (1) stay enforcement of the penalty by:
46-21 (A) paying the amount of the penalty to the
46-22 court for placement in an escrow account; or
46-23 (B) giving to the court a supersedeas bond that
46-24 is approved by the court for the amount of the penalty and that is
46-25 effective until all judicial review of the department's order is
47-1 final; or
47-2 (2) request the court to stay enforcement of the
47-3 penalty by:
47-4 (A) filing with the court a sworn affidavit of
47-5 the person stating that the person is financially unable to pay the
47-6 amount of the penalty and is financially unable to give the
47-7 supersedeas bond; and
47-8 (B) giving a copy of the affidavit to the
47-9 commissioner by certified mail.
47-10 (o) If the commissioner receives a copy of an affidavit
47-11 under Subsection (n)(2), the commissioner may file with the court,
47-12 within five days after the date the copy is received, a contest to
47-13 the affidavit. The court shall hold a hearing on the facts alleged
47-14 in the affidavit as soon as practicable and shall stay the
47-15 enforcement of the penalty on finding that the alleged facts are
47-16 true. The person who files an affidavit has the burden of proving
47-17 that the person is financially unable to pay the amount of the
47-18 penalty and to give a supersedeas bond.
47-19 (p) [(l) Except as provided by Subsection (m) of this
47-20 section, not later than 30 days after the date on which the
47-21 department issues a final decision after a hearing under Subsection
47-22 (j) of this section, a person who has been ordered to pay a penalty
47-23 under this section shall pay the penalty in full.]
47-24 [(m) If the person seeks judicial review of either the fact
47-25 of the submission of a false claim or the amount of the penalty or
48-1 of both the fact of the submission and the amount of the penalty,
48-2 the person shall forward the amount of the penalty to the
48-3 department for placement in an escrow account or, instead of
48-4 payment into an escrow account, post with the department a
48-5 supersedeas bond in a form approved by the department for the
48-6 amount of the penalty. The bond must be effective until all
48-7 judicial review of the order or decision is final.]
48-8 [(n) Failure to forward the money to or to post the bond
48-9 with the department within the period provided by Subsection (l) or
48-10 (m) of this section results in a waiver of all legal rights to
48-11 judicial review.] If the person charged does not pay the amount of
48-12 the penalty and the enforcement of the penalty is not stayed [fails
48-13 to forward the money or post the bond within the period provided by
48-14 Subsection (h), (k), (l), or (m) of this section], the department
48-15 may forward the matter to the attorney general for enforcement of
48-16 the penalty and interest as provided by law for legal judgments.
48-17 An action to enforce a penalty order under this section must be
48-18 initiated in a court of competent jurisdiction in Travis County or
48-19 in the county in [from] which the violation [false claim] was
48-20 committed [submitted].
48-21 (q) [(o)] Judicial review of a department order or review
48-22 under this section assessing a penalty is under the substantial
48-23 evidence rule. A suit may be initiated by filing a petition with a
48-24 district court in Travis County, as provided by Subchapter G,
48-25 Chapter 2001, Government Code.
49-1 (r) [(p)] If a penalty is reduced or not assessed, the
49-2 department shall remit to the person the appropriate amount plus
49-3 accrued interest if the penalty has been paid or shall execute a
49-4 release of the bond if a supersedeas bond has been posted. The
49-5 accrued interest on amounts remitted by the department under this
49-6 subsection shall be paid at a rate equal to the rate provided by
49-7 law for legal judgments and shall be paid for the period beginning
49-8 on the date the penalty is paid to the department under this
49-9 section and ending on the date the penalty is remitted.
49-10 (s) [(q)] A damage, cost, or penalty collected under this
49-11 section is not an allowable expense in a claim or cost report that
49-12 is or could be used to determine a rate or payment under the
49-13 medical assistance program.
49-14 (t) [(r)] All funds collected under this section shall be
49-15 deposited in the State Treasury to the credit of the General
49-16 Revenue Fund.
49-17 (u) A person found liable for a violation under Subsection
49-18 (c) that resulted in injury to a person younger than 18 years of
49-19 age or a person who is elderly or disabled may not provide or
49-20 arrange to provide health care services under the medical
49-21 assistance program for a period of 10 years. The department by
49-22 rule may provide for a period of ineligibility longer than 10
49-23 years. The period of ineligibility begins on the date on which the
49-24 determination that the person is liable becomes final. This
49-25 subsection does not apply to a person who operates a nursing
50-1 facility.
50-2 (v) A person found liable for a violation under Subsection
50-3 (c) that did not result in injury to a person younger than 18 years
50-4 of age or a person who is elderly or disabled may not provide or
50-5 arrange to provide health care services under the medical
50-6 assistance program for a period of three years. The department by
50-7 rule may provide for a period of ineligibility longer than three
50-8 years. The period of ineligibility begins on the date on which the
50-9 determination that the person is liable becomes final. This
50-10 subsection does not apply to a person who operates a nursing
50-11 facility.
50-12 (b) The change in law made by this section applies only to a
50-13 violation committed on or after the effective date of this section.
50-14 For purposes of this subsection, a violation is committed on or
50-15 after the effective date of this section only if each element of
50-16 the violation occurs on or after that date. A violation committed
50-17 before the effective date of this section is covered by the law in
50-18 effect when the violation was committed, and the former law is
50-19 continued in effect for that purpose.
50-20 SECTION 3.02. SANCTIONS APPLICABLE TO VENDOR DRUG PROGRAM.
50-21 Subchapter B, Chapter 32, Human Resources Code, is amended by
50-22 adding Section 32.046 to read as follows:
50-23 Sec. 32.046. VENDOR DRUG PROGRAM; SANCTIONS AND PENALTIES.
50-24 (a) The department shall adopt rules governing sanctions and
50-25 penalties that apply to a provider in the vendor drug program who
51-1 submits an improper claim for reimbursement under the program.
51-2 (b) The department shall notify each provider in the vendor
51-3 drug program that the provider is subject to sanctions and
51-4 penalties for submitting an improper claim.
51-5 SECTION 3.03. PROHIBITION OF CERTAIN PERSONS CONVICTED OF
51-6 FRAUD. Subchapter B, Chapter 32, Human Resources Code, is amended
51-7 by adding Section 32.047 to read as follows:
51-8 Sec. 32.047. PROHIBITION OF CERTAIN HEALTH CARE SERVICE
51-9 PROVIDERS. A person is permanently prohibited from providing or
51-10 arranging to provide health care services under the medical
51-11 assistance program if:
51-12 (1) the person is convicted of an offense arising from
51-13 a fraudulent act under the program; and
51-14 (2) the person's fraudulent act results in injury to a
51-15 person younger than 18 years of age or a person who is elderly or
51-16 disabled.
51-17 SECTION 3.04. DEDUCTIONS FROM LOTTERY WINNINGS.
51-18 (a) Subsections (a) and (c), Section 466.407, Government Code, are
51-19 amended to read as follows:
51-20 (a) The executive director shall deduct the amount of a
51-21 delinquent tax or other money from the winnings of a person who has
51-22 been finally determined to be:
51-23 (1) delinquent in the payment of a tax or other money
51-24 collected by the comptroller[, the state treasurer,] or the Texas
51-25 Alcoholic Beverage Commission;
52-1 (2) delinquent in making child support payments
52-2 administered or collected by the attorney general;
52-3 (3) delinquent in reimbursing the Texas Department of
52-4 Human Services for a benefit granted in error under the food stamp
52-5 program or the program of financial assistance under Chapter 31,
52-6 Human Resources Code;
52-7 (4) in default on a loan made under Chapter 52,
52-8 Education Code; or
52-9 (5) [(4)] in default on a loan guaranteed under
52-10 Chapter 57, Education Code.
52-11 (c) The attorney general, comptroller, [state treasurer,]
52-12 Texas Alcoholic Beverage Commission, Texas Department of Human
52-13 Services, Texas Higher Education Coordinating Board, and Texas
52-14 Guaranteed Student Loan Corporation shall each provide the
52-15 executive director with a report of persons who have been finally
52-16 determined to be delinquent in the payment of a tax or other money
52-17 collected by the agency. The commission shall adopt rules
52-18 regarding the form and frequency of reports under this subsection.
52-19 (b) The Texas Department of Human Services shall take all
52-20 action necessary to implement the change in law made by this
52-21 section not later than January 1, 1998. The department may not
52-22 seek recovery through lottery prize deduction of an amount of a
52-23 benefit granted in error to a person under the food stamp program
52-24 or the program of financial assistance under Chapter 31, Human
52-25 Resources Code, before September 1, 1997.
53-1 (c) The executive director of the Texas Lottery Commission
53-2 is not required under Section 466.407, Government Code, as amended
53-3 by this section, to deduct from lottery prizes erroneous amounts
53-4 granted to lottery winners by the Texas Department of Human
53-5 Services until the department provides to the commission all
53-6 necessary information and reports required for implementation of
53-7 that section.
53-8 ARTICLE 4. CIVIL REMEDIES RELATING TO MEDICAID FRAUD
53-9 AND CREATION OF CRIMINAL OFFENSE
53-10 SECTION 4.01. REDESIGNATION. (a) Chapter 36, Human
53-11 Resources Code, is amended by designating Sections 36.001, 36.002,
53-12 36.007, 36.008, 36.009, 36.010, 36.011, and 36.012 as Subchapter A,
53-13 renumbering Sections 36.007, 36.008, 36.009, 36.010, 36.011, and
53-14 36.012 as Sections 36.003, 36.004, 36.005, 36.006, 36.007, and
53-15 36.008, respectively, and adding a subchapter heading to read as
53-16 follows:
53-17 SUBCHAPTER A. GENERAL PROVISIONS
53-18 (b) Chapter 36, Human Resources Code, is amended by
53-19 designating Sections 36.003, 36.004, 36.005, and 36.006 as
53-20 Subchapter B, renumbering those sections as Sections 36.051,
53-21 36.052, 36.053, and 36.054, respectively, and adding a subchapter
53-22 heading to read as follows:
53-23 SUBCHAPTER B. ACTION BY ATTORNEY GENERAL
53-24 SECTION 4.02. DEFINITIONS. Section 36.001, Human Resources
53-25 Code, is amended by amending Subdivisions (5) through (11) and
54-1 adding Subdivision (12) to read as follows:
54-2 (5) "Managed care organization" has the meaning
54-3 assigned by Section 32.039(a).
54-4 (6) "Medicaid program" means the state Medicaid
54-5 program.
54-6 (7) [(6)] "Medicaid recipient" means an individual on
54-7 whose behalf a person claims or receives a payment from the
54-8 Medicaid program or a fiscal agent, without regard to whether the
54-9 individual was eligible for benefits under the Medicaid program.
54-10 (8) [(7)] "Physician" means a physician licensed to
54-11 practice medicine in this state.
54-12 (9) [(8)] "Provider" means a person who participates
54-13 in or who has applied to participate in the Medicaid program as a
54-14 supplier of a product or service and includes:
54-15 (A) a management company that manages, operates,
54-16 or controls another provider;
54-17 (B) a person, including a medical vendor, that
54-18 provides a product or service to a provider or to a fiscal agent;
54-19 [and]
54-20 (C) an employee of a provider; and
54-21 (D) a managed care organization.
54-22 (10) [(9)] "Service" includes care or treatment of a
54-23 Medicaid recipient.
54-24 (11) [(10)] "Signed" means to have affixed a signature
54-25 directly or indirectly by means of handwriting, typewriting,
55-1 signature stamp, computer impulse, or other means recognized by
55-2 law.
55-3 (12) [(11)] "Unlawful act" means an act declared to be
55-4 unlawful under Section 36.002.
55-5 SECTION 4.03. UNLAWFUL ACTS RELATING TO MANAGED CARE
55-6 ORGANIZATION. Section 36.002, Human Resources Code, is amended to
55-7 read as follows:
55-8 Sec. 36.002. UNLAWFUL ACTS. A person commits an unlawful
55-9 act if the person:
55-10 (1) knowingly or intentionally makes or causes to be
55-11 made a false statement or misrepresentation of a material fact:
55-12 (A) on an application for a contract, benefit,
55-13 or payment under the Medicaid program; or
55-14 (B) that is intended to be used to determine a
55-15 person's eligibility for a benefit or payment under the Medicaid
55-16 program;
55-17 (2) knowingly or intentionally conceals or fails to
55-18 disclose an event:
55-19 (A) that the person knows affects the initial or
55-20 continued right to a benefit or payment under the Medicaid program
55-21 of:
55-22 (i) the person; or
55-23 (ii) another person on whose behalf the
55-24 person has applied for a benefit or payment or is receiving a
55-25 benefit or payment; and
56-1 (B) to permit a person to receive a benefit or
56-2 payment that is not authorized or that is greater than the payment
56-3 or benefit that is authorized;
56-4 (3) knowingly or intentionally applies for and
56-5 receives a benefit or payment on behalf of another person under the
56-6 Medicaid program and converts any part of the benefit or payment to
56-7 a use other than for the benefit of the person on whose behalf it
56-8 was received;
56-9 (4) knowingly or intentionally makes, causes to be
56-10 made, induces, or seeks to induce the making of a false statement
56-11 or misrepresentation of material fact concerning:
56-12 (A) the conditions or operation of a facility in
56-13 order that the facility may qualify for certification or
56-14 recertification required by the Medicaid program, including
56-15 certification or recertification as:
56-16 (i) a hospital;
56-17 (ii) a nursing facility or skilled nursing
56-18 facility;
56-19 (iii) a hospice;
56-20 (iv) an intermediate care facility for the
56-21 mentally retarded;
56-22 (v) a personal care facility; or
56-23 (vi) a home health agency; or
56-24 (B) information required to be provided by a
56-25 federal or state law, rule, regulation, or provider agreement
57-1 pertaining to the Medicaid program;
57-2 (5) except as authorized under the Medicaid program,
57-3 knowingly or intentionally charges, solicits, accepts, or receives,
57-4 in addition to an amount paid under the Medicaid program, a gift,
57-5 money, a donation, or other consideration as a condition to the
57-6 provision of a service or continued service to a Medicaid recipient
57-7 if the cost of the service provided to the Medicaid recipient is
57-8 paid for, in whole or in part, under the Medicaid program;
57-9 (6) knowingly or intentionally presents or causes to
57-10 be presented a claim for payment under the Medicaid program for a
57-11 product provided or a service rendered by a person who:
57-12 (A) is not licensed to provide the product or
57-13 render the service, if a license is required; or
57-14 (B) is not licensed in the manner claimed;
57-15 (7) knowingly or intentionally makes a claim under the
57-16 Medicaid program for:
57-17 (A) a service or product that has not been
57-18 approved or acquiesced in by a treating physician or health care
57-19 practitioner;
57-20 (B) a service or product that is substantially
57-21 inadequate or inappropriate when compared to generally recognized
57-22 standards within the particular discipline or within the health
57-23 care industry; or
57-24 (C) a product that has been adulterated,
57-25 debased, mislabeled, or that is otherwise inappropriate;
58-1 (8) makes a claim under the Medicaid program and
58-2 knowingly or intentionally fails to indicate the type of license
58-3 and the identification number of the licensed health care provider
58-4 who actually provided the service; [or]
58-5 (9) knowingly or intentionally enters into an
58-6 agreement, combination, or conspiracy to defraud the state by
58-7 obtaining or aiding another person in obtaining an unauthorized
58-8 payment or benefit from the Medicaid program or a fiscal agent; or
58-9 (10) is a managed care organization that contracts
58-10 with the Health and Human Services Commission or other state agency
58-11 to provide or arrange to provide health care benefits or services
58-12 to individuals eligible under the Medicaid program and knowingly or
58-13 intentionally:
58-14 (A) fails to provide to an individual a health
58-15 care benefit or service that the organization is required to
58-16 provide under the contract;
58-17 (B) fails to provide to the commission or
58-18 appropriate state agency information required to be provided by
58-19 law, commission or agency rule, or contractual provision;
58-20 (C) engages in a fraudulent activity in
58-21 connection with the enrollment of an individual eligible under the
58-22 Medicaid program in the organization's managed care plan or in
58-23 connection with marketing the organization's services to an
58-24 individual eligible under the Medicaid program; or
58-25 (D) obstructs an investigation by the attorney
59-1 general of an alleged unlawful act under this section.
59-2 SECTION 4.04. APPLICABLE PENALTIES AND CONFORMING AMENDMENT.
59-3 Section 36.004, Human Resources Code, as renumbered by this article
59-4 as Section 36.052, is amended by amending Subsections (a) and (e)
59-5 to read as follows:
59-6 (a) Except as provided by Subsection (c), a person who
59-7 commits an unlawful act is liable to the state for:
59-8 (1) restitution of the value of any payment or
59-9 monetary or in-kind benefit provided under the Medicaid program,
59-10 directly or indirectly, as a result of the unlawful act;
59-11 (2) interest on the value of the payment or benefit
59-12 described by Subdivision (1) at the prejudgment interest rate in
59-13 effect on the day the payment or benefit was received or paid, for
59-14 the period from the date the benefit was received or paid to the
59-15 date that restitution is paid to the state;
59-16 (3) a civil penalty of:
59-17 (A) not less than $5,000 or more than $15,000
59-18 for each unlawful act committed by the person that results in
59-19 injury to a person younger than 18 years of age or a person who is
59-20 elderly or disabled; or
59-21 (B) not less than $1,000 or more than $10,000
59-22 for each unlawful act committed by the person that does not result
59-23 in injury to a person younger than 18 years of age or a person who
59-24 is elderly or disabled; and
59-25 (4) two times the value of the payment or benefit
60-1 described by Subdivision (1).
60-2 (e) The attorney general may:
60-3 (1) bring an action for civil remedies under this
60-4 section together with a suit for injunctive relief under Section
60-5 36.051 [36.003]; or
60-6 (2) institute an action for civil remedies
60-7 independently of an action for injunctive relief.
60-8 SECTION 4.05. CONFORMING AMENDMENT. Section 36.005, Human
60-9 Resources Code, as renumbered by this article as Section 36.053, is
60-10 amended by amending Subsection (b) to read as follows:
60-11 (b) In investigating an unlawful act, the attorney general
60-12 may:
60-13 (1) require the person to file on a prescribed form a
60-14 statement in writing, under oath or affirmation, as to all the
60-15 facts and circumstances concerning the alleged unlawful act and
60-16 other information considered necessary by the attorney general;
60-17 (2) examine under oath a person in connection with the
60-18 alleged unlawful act; and
60-19 (3) execute in writing and serve on the person a civil
60-20 investigative demand requiring the person to produce the
60-21 documentary material and permit inspection and copying of the
60-22 material under Section 36.054 [36.006].
60-23 SECTION 4.06. ADDITIONAL SANCTIONS FOR MEDICAID FRAUD.
60-24 Section 36.009, Human Resources Code, as renumbered by this article
60-25 as Section 36.005, is amended to read as follows:
61-1 Sec. 36.005 [36.009]. SUSPENSION OR REVOCATION OF AGREEMENT;
61-2 PROFESSIONAL DISCIPLINE. (a) The commissioner of human services,
61-3 the commissioner of public health, the commissioner of mental
61-4 health and mental retardation, the executive director of the
61-5 Department of Protective and Regulatory Services, or the executive
61-6 director of another state health care regulatory agency:
61-7 (1) shall suspend or revoke:
61-8 (A) a provider agreement between the department
61-9 or agency and a person, other than a person who operates a nursing
61-10 facility, found liable under Section 36.052; and
61-11 (B) a permit, license, or certification granted
61-12 by the department or agency to a person, other than a person who
61-13 operates a nursing facility, found liable under Section 36.052; and
61-14 (2) may suspend or revoke:
61-15 (A) [(1)] a provider agreement between the
61-16 department or agency and a person who operates a nursing facility
61-17 found liable under Section 36.052 [36.004]; or
61-18 (B) [(2)] a permit, license, or certification
61-19 granted by the department or agency to a person who operates a
61-20 nursing facility found liable under Section 36.052 [36.004].
61-21 (b) A person found liable under Section 36.052 for an
61-22 unlawful act may not provide or arrange to provide health care
61-23 services under the Medicaid program for a period of 10 years. The
61-24 board of a state agency that operates part of the Medicaid program
61-25 may by rule provide for a period of ineligibility longer than 10
62-1 years. The period of ineligibility begins on the date on which the
62-2 determination that the person is liable becomes final. This
62-3 section does not apply to a person who operates a nursing facility.
62-4 (c) A person licensed by a state regulatory agency who
62-5 commits an unlawful act is subject to professional discipline under
62-6 the applicable licensing law or rules adopted under that law.
62-7 (d) For purposes of this section, a person is considered to
62-8 have been found liable under Section 36.052 if the person is found
62-9 liable in an action brought under Subchapter C.
62-10 SECTION 4.07. AUTHORITY OF ATTORNEY GENERAL.
62-11 (a) Subchapter B, Chapter 36, Human Resources Code, as designated
62-12 by this article, is amended by adding Section 36.055 to read as
62-13 follows:
62-14 Sec. 36.055. ATTORNEY GENERAL AS RELATOR IN FEDERAL ACTION.
62-15 To the extent permitted by 31 U.S.C. Sections 3729-3733, the
62-16 attorney general may bring an action as relator under 31 U.S.C.
62-17 Section 3730 with respect to an act in connection with the Medicaid
62-18 program for which a person may be held liable under 31 U.S.C.
62-19 Section 3729. The attorney general may contract with a private
62-20 attorney to represent the state under this section.
62-21 (b) The Office of the Attorney General shall develop
62-22 strategies to increase state recoveries under 31 U.S.C. Sections
62-23 3729 through 3733. The office shall report the results of the
62-24 office's effort to the legislature not later than September 1,
62-25 1998.
63-1 SECTION 4.08. CIVIL ACTION BY PRIVATE PERSON FOR MEDICAID
63-2 FRAUD. Chapter 36, Human Resources Code, is amended by adding
63-3 Subchapter C to read as follows:
63-4 SUBCHAPTER C. ACTION BY PRIVATE PERSONS
63-5 Sec. 36.101. ACTION BY PRIVATE PERSON AUTHORIZED. (a) A
63-6 person may bring a civil action for a violation of Section 36.002
63-7 for the person and for the state. The action shall be brought in
63-8 the name of the person and of the state.
63-9 (b) In an action brought under this subchapter, a person who
63-10 violates Section 36.002 is liable as provided by Section 36.052.
63-11 Sec. 36.102. INITIATION OF ACTION. (a) A person bringing
63-12 an action under this subchapter shall serve a copy of the petition
63-13 and a written disclosure of substantially all material evidence and
63-14 information the person possesses on the attorney general in
63-15 compliance with the Texas Rules of Civil Procedure.
63-16 (b) The petition shall be filed in camera and shall remain
63-17 under seal until at least the 60th day after the date the petition
63-18 is filed. The petition may not be served on the defendant until
63-19 the court orders service on the defendant.
63-20 (c) The state may elect to intervene and proceed with the
63-21 action not later than the 60th day after the date the attorney
63-22 general receives the petition and the material evidence and
63-23 information.
63-24 (d) The state may, for good cause shown, move the court to
63-25 extend the time during which the petition remains under seal under
64-1 Subsection (b). A motion under this subsection may be supported by
64-2 affidavits or other submissions in camera.
64-3 (e) An action under this subchapter may be dismissed before
64-4 the end of the period prescribed by Subsection (b), as extended as
64-5 provided by Subsection (d), if applicable, only if the court and
64-6 the attorney general consent in writing to the dismissal and state
64-7 their reasons for consenting.
64-8 Sec. 36.103. ANSWER BY DEFENDANT. A defendant is not
64-9 required to file an answer to a petition filed under this
64-10 subchapter until the 20th day after the date the petition is
64-11 unsealed and served on the defendant in compliance with the Texas
64-12 Rules of Civil Procedure.
64-13 Sec. 36.104. CONTINUATION OR DISMISSAL OF ACTION BASED ON
64-14 STATE DECISION. (a) Not later than the last day of the period
64-15 prescribed by Section 36.102(b), as extended as provided by Section
64-16 36.102(d), if applicable, the state shall:
64-17 (1) proceed with the action; or
64-18 (2) notify the court that the state declines to take
64-19 over the action.
64-20 (b) If the state declines to take over the action, the court
64-21 shall dismiss the action.
64-22 Sec. 36.105. REPRESENTATION OF STATE BY PRIVATE ATTORNEY.
64-23 The attorney general may contract with a private attorney to
64-24 represent the state in an action under this subchapter with which
64-25 the state elects to proceed.
65-1 Sec. 36.106. INTERVENTION BY OTHER PARTIES PROHIBITED. A
65-2 person other than the state may not intervene or bring a related
65-3 action based on the facts underlying a pending action brought under
65-4 this subchapter.
65-5 Sec. 36.107. RIGHTS OF PARTIES IF STATE CONTINUES ACTION.
65-6 (a) If the state proceeds with the action, the state has the
65-7 primary responsibility for prosecuting the action and is not bound
65-8 by an act of the person bringing the action. The person bringing
65-9 the action has the right to continue as a party to the action,
65-10 subject to the limitations set forth by this section.
65-11 (b) The state may dismiss the action notwithstanding the
65-12 objections of the person bringing the action if:
65-13 (1) the attorney general notifies the person that the
65-14 state has filed a motion to dismiss; and
65-15 (2) the court provides the person with an opportunity
65-16 for a hearing on the motion.
65-17 (c) The state may settle the action with the defendant
65-18 notwithstanding the objections of the person bringing the action if
65-19 the court determines, after a hearing, that the proposed settlement
65-20 is fair, adequate, and reasonable under all the circumstances. On
65-21 a showing of good cause, the hearing may be held in camera.
65-22 (d) On a showing by the state that unrestricted
65-23 participation during the course of the litigation by the person
65-24 bringing the action would interfere with or unduly delay the
65-25 state's prosecution of the case, or would be repetitious,
66-1 irrelevant, or for purposes of harassment, the court may impose
66-2 limitations on the person's participation, including:
66-3 (1) limiting the number of witnesses the person may
66-4 call;
66-5 (2) limiting the length of the testimony of witnesses
66-6 called by the person;
66-7 (3) limiting the person's cross-examination of
66-8 witnesses; or
66-9 (4) otherwise limiting the participation by the person
66-10 in the litigation.
66-11 (e) On a showing by the defendant that unrestricted
66-12 participation during the course of the litigation by the person
66-13 bringing the action would be for purposes of harassment or would
66-14 cause the defendant undue burden or unnecessary expense, the court
66-15 may limit the participation by the person in the litigation.
66-16 Sec. 36.108. STAY OF CERTAIN DISCOVERY. (a) On a showing
66-17 by the state that certain actions of discovery by the person
66-18 bringing the action would interfere with the state's investigation
66-19 or prosecution of a criminal or civil matter arising out of the
66-20 same facts, the court may stay the discovery for a period not to
66-21 exceed 60 days.
66-22 (b) The court shall hear a motion to stay discovery under
66-23 this section in camera.
66-24 (c) The court may extend the period prescribed by Subsection
66-25 (a) on a further showing in camera that the state has pursued the
67-1 criminal or civil investigation or proceedings with reasonable
67-2 diligence and that any proposed discovery in the civil action will
67-3 interfere with the ongoing criminal or civil investigation or
67-4 proceedings.
67-5 Sec. 36.109. PURSUIT OF ALTERNATE REMEDY BY STATE.
67-6 (a) Notwithstanding Section 36.101, the state may elect to pursue
67-7 the state's claim through any alternate remedy available to the
67-8 state, including any administrative proceeding to determine an
67-9 administrative penalty. If an alternate remedy is pursued in
67-10 another proceeding, the person bringing the action has the same
67-11 rights in the other proceeding as the person would have had if the
67-12 action had continued under this subchapter.
67-13 (b) A finding of fact or conclusion of law made in the other
67-14 proceeding that has become final is conclusive on all parties to an
67-15 action under this subchapter. For purposes of this subsection, a
67-16 finding or conclusion is final if:
67-17 (1) the finding or conclusion has been finally
67-18 determined on appeal to the appropriate court;
67-19 (2) no appeal has been filed with respect to the
67-20 finding or conclusion and all time for filing an appeal has
67-21 expired; or
67-22 (3) the finding or conclusion is not subject to
67-23 judicial review.
67-24 Sec. 36.110. AWARD TO PRIVATE PLAINTIFF. (a) If the state
67-25 proceeds with an action under this subchapter, the person bringing
68-1 the action is entitled, except as provided by Subsection (b), to
68-2 receive at least 10 percent but not more than 25 percent of the
68-3 proceeds of the action, depending on the extent to which the person
68-4 substantially contributed to the prosecution of the action.
68-5 (b) If the court finds that the action is based primarily on
68-6 disclosures of specific information, other than information
68-7 provided by the person bringing the action, relating to allegations
68-8 or transactions in a criminal or civil hearing, in a legislative or
68-9 administrative report, hearing, audit, or investigation, or from
68-10 the news media, the court may award the amount the court considers
68-11 appropriate but not more than seven percent of the proceeds of the
68-12 action. The court shall consider the significance of the
68-13 information and the role of the person bringing the action in
68-14 advancing the case to litigation.
68-15 (c) A payment to a person under this section shall be made
68-16 from the proceeds of the action. A person receiving a payment
68-17 under this section is also entitled to receive an amount for
68-18 reasonable expenses that the court finds to have been necessarily
68-19 incurred, plus reasonable attorney's fees and costs. Expenses,
68-20 fees, and costs shall be awarded against the defendant.
68-21 (d) In this section, "proceeds of the action" includes
68-22 proceeds of a settlement of the action.
68-23 Sec. 36.111. REDUCTION OF AWARD. (a) If the court finds
68-24 that the action was brought by a person who planned and initiated
68-25 the violation of Section 36.002 on which the action was brought,
69-1 the court may, to the extent the court considers appropriate,
69-2 reduce the share of the proceeds of the action the person would
69-3 otherwise receive under Section 36.110, taking into account the
69-4 person's role in advancing the case to litigation and any relevant
69-5 circumstances pertaining to the violation.
69-6 (b) If the person bringing the action is convicted of
69-7 criminal conduct arising from the person's role in the violation of
69-8 Section 36.002, the court shall dismiss the person from the civil
69-9 action and the person may not receive any share of the proceeds of
69-10 the action. A dismissal under this subsection does not prejudice
69-11 the right of the state to continue the action.
69-12 Sec. 36.112. AWARD TO DEFENDANT FOR FRIVOLOUS ACTION.
69-13 Chapter 105, Civil Practice and Remedies Code, applies in an action
69-14 under this subchapter with which the state proceeds.
69-15 Sec. 36.113. CERTAIN ACTIONS BARRED. (a) A person may not
69-16 bring an action under this subchapter that is based on allegations
69-17 or transactions that are the subject of a civil suit or an
69-18 administrative penalty proceeding in which the state is already a
69-19 party.
69-20 (b) A person may not bring an action under this subchapter
69-21 that is based on the public disclosure of allegations or
69-22 transactions in a criminal or civil hearing, in a legislative or
69-23 administrative report, hearing, audit, or investigation, or from
69-24 the news media, unless the person bringing the action is an
69-25 original source of the information. In this subsection, "original
70-1 source" means an individual who has direct and independent
70-2 knowledge of the information on which the allegations are based and
70-3 has voluntarily provided the information to the state before filing
70-4 an action under this subchapter that is based on the information.
70-5 Sec. 36.114. STATE NOT LIABLE FOR CERTAIN EXPENSES. The
70-6 state is not liable for expenses that a person incurs in bringing
70-7 an action under this subchapter.
70-8 Sec. 36.115. RETALIATION BY EMPLOYER AGAINST PERSON BRINGING
70-9 SUIT PROHIBITED. (a) A person who is discharged, demoted,
70-10 suspended, threatened, harassed, or in any other manner
70-11 discriminated against in the terms of employment by the person's
70-12 employer because of a lawful act taken by the person in furtherance
70-13 of an action under this subchapter, including investigation for,
70-14 initiation of, testimony for, or assistance in an action filed or
70-15 to be filed under this subchapter, is entitled to:
70-16 (1) reinstatement with the same seniority status the
70-17 person would have had but for the discrimination; and
70-18 (2) not less than two times the amount of back pay,
70-19 interest on the back pay, and compensation for any special damages
70-20 sustained as a result of the discrimination, including litigation
70-21 costs and reasonable attorney's fees.
70-22 (b) A person may bring an action in the appropriate district
70-23 court for the relief provided in this section.
70-24 Sec. 36.116. SOVEREIGN IMMUNITY NOT WAIVED. Except as
70-25 provided by Section 36.112, this subchapter does not waive
71-1 sovereign immunity.
71-2 Sec. 36.117. ATTORNEY GENERAL COMPENSATION. The office of
71-3 the attorney general may retain a reasonable portion of recoveries
71-4 under this subchapter, not to exceed amounts specified in the
71-5 General Appropriations Act, for the administration of this
71-6 subchapter.
71-7 SECTION 4.09. CRIMINAL OFFENSE AND REVOCATION OF CERTAIN
71-8 LICENSES. Chapter 36, Human Resources Code, is amended by adding
71-9 Subchapter D to read as follows:
71-10 SUBCHAPTER D. CRIMINAL PENALTIES AND REVOCATION OF CERTAIN
71-11 OCCUPATIONAL LICENSES
71-12 Sec. 36.131. CRIMINAL OFFENSE. (a) A person commits an
71-13 offense if the person commits an unlawful act under Section 36.002.
71-14 (b) An offense under this section is:
71-15 (1) a Class C misdemeanor if the value of any payment
71-16 or monetary or in-kind benefit provided under the Medicaid program,
71-17 directly or indirectly, as a result of the unlawful act is less
71-18 than $50;
71-19 (2) a Class B misdemeanor if the value of any payment
71-20 or monetary or in-kind benefit provided under the Medicaid program,
71-21 directly or indirectly, as a result of the unlawful act is $50 or
71-22 more but less than $500;
71-23 (3) a Class A misdemeanor if the value of any payment
71-24 or monetary or in-kind benefit provided under the Medicaid program,
71-25 directly or indirectly, as a result of the unlawful act is $500 or
72-1 more but less than $1,500;
72-2 (4) a state jail felony if the value of any payment or
72-3 monetary or in-kind benefit provided under the Medicaid program,
72-4 directly or indirectly, as a result of the unlawful act is $1,500
72-5 or more but less than $20,000;
72-6 (5) a felony of the third degree if the value of any
72-7 payment or monetary or in-kind benefit provided under the Medicaid
72-8 program, directly or indirectly, as a result of the unlawful act is
72-9 $20,000 or more but less than $100,000;
72-10 (6) a felony of the second degree if the value of any
72-11 payment or monetary or in-kind benefit provided under the Medicaid
72-12 program, directly or indirectly, as a result of the unlawful act is
72-13 $100,000 or more but less than $200,000; or
72-14 (7) a felony of the first degree if the value of any
72-15 payment or monetary or in-kind benefit provided under the Medicaid
72-16 program, directly or indirectly, as a result of the unlawful act is
72-17 $200,000 or more.
72-18 (c) If conduct constituting an offense under this section
72-19 also constitutes an offense under another provision of law,
72-20 including a provision in the Penal Code, the actor may be
72-21 prosecuted under either this section or the other provision.
72-22 (d) When multiple payments or monetary or in-kind benefits
72-23 are provided under the Medicaid program as a result of one scheme
72-24 or continuing course of conduct, the conduct may be considered as
72-25 one offense and the amounts of the payments or monetary or in-kind
73-1 benefits aggregated in determining the grade of the offense.
73-2 Sec. 36.132. REVOCATION OF LICENSES. (a) In this section:
73-3 (1) "License" means a license, certificate,
73-4 registration, permit, or other authorization that:
73-5 (A) is issued by a licensing authority;
73-6 (B) is subject before expiration to suspension,
73-7 revocation, forfeiture, or termination by an issuing licensing
73-8 authority; and
73-9 (C) must be obtained before a person may
73-10 practice or engage in a particular business, occupation, or
73-11 profession.
73-12 (2) "Licensing authority" means:
73-13 (A) the Texas State Board of Medical Examiners;
73-14 (B) the State Board of Dental Examiners;
73-15 (C) the Texas State Board of Examiners of
73-16 Psychologists;
73-17 (D) the Texas State Board of Social Worker
73-18 Examiners;
73-19 (E) the Board of Nurse Examiners;
73-20 (F) the Board of Vocational Nurse Examiners;
73-21 (G) the Texas Board of Physical Therapy
73-22 Examiners; or
73-23 (H) the Texas Board of Occupational Therapy
73-24 Examiners.
73-25 (b) A licensing authority shall revoke a license issued by
74-1 the authority to a person if the person is convicted of a felony
74-2 under Section 36.131. In revoking the license, the licensing
74-3 authority shall comply with all procedures generally applicable to
74-4 the licensing authority in revoking licenses.
74-5 SECTION 4.10. APPLICATION. (a) The changes in law made by
74-6 this article apply only to a violation committed on or after the
74-7 effective date of this article. For purposes of this section, a
74-8 violation is committed on or after the effective date of this
74-9 article only if each element of the violation occurs on or after
74-10 that date.
74-11 (b) A violation committed before the effective date of this
74-12 article is covered by the law in effect when the violation was
74-13 committed, and the former law is continued in effect for this
74-14 purpose.
74-15 ARTICLE 5. SUSPENSION OF LICENSES
74-16 SECTION 5.01. SUSPENSION OF LICENSES. (a) Subtitle B,
74-17 Title 2, Human Resources Code, is amended by adding Chapter 23 to
74-18 read as follows:
74-19 CHAPTER 23. SUSPENSION OF DRIVER'S OR RECREATIONAL
74-20 LICENSE FOR FAILURE TO REIMBURSE DEPARTMENT
74-21 Sec. 23.001. DEFINITIONS. In this chapter:
74-22 (1) "License" means a license, certificate,
74-23 registration, permit, or other authorization that:
74-24 (A) is issued by a licensing authority;
74-25 (B) is subject before expiration to suspension,
75-1 revocation, forfeiture, or termination by an issuing licensing
75-2 authority; and
75-3 (C) a person must obtain to:
75-4 (i) operate a motor vehicle; or
75-5 (ii) engage in a recreational activity,
75-6 including hunting and fishing, for which a license or permit is
75-7 required.
75-8 (2) "Order suspending a license" means an order issued
75-9 by the department directing a licensing authority to suspend a
75-10 license.
75-11 Sec. 23.002. LICENSING AUTHORITIES SUBJECT TO CHAPTER. In
75-12 this chapter, "licensing authority" means:
75-13 (1) the Parks and Wildlife Department; and
75-14 (2) the Department of Public Safety of the State of
75-15 Texas.
75-16 Sec. 23.003. SUSPENSION OF LICENSE. The department may
75-17 issue an order suspending a license as provided by this chapter of
75-18 a person who, after notice:
75-19 (1) has failed to reimburse the department for an
75-20 amount in excess of $250 granted in error to the person under the
75-21 food stamp program or the program of financial assistance under
75-22 Chapter 31;
75-23 (2) has been provided an opportunity to make payments
75-24 toward the amount owed under a repayment schedule; and
75-25 (3) has failed to comply with the repayment schedule.
76-1 Sec. 23.004. INITIATION OF PROCEEDING. (a) The department
76-2 may initiate a proceeding to suspend a person's license by filing a
76-3 petition with the department's hearings division.
76-4 (b) The proceeding shall be conducted by the department's
76-5 hearings division. The proceeding is a contested case under
76-6 Chapter 2001, Government Code, except that Section 2001.054 does
76-7 not apply.
76-8 (c) The commissioner shall render a final decision in the
76-9 proceeding.
76-10 Sec. 23.005. CONTENTS OF PETITION. A petition under this
76-11 chapter must state that license suspension is authorized under
76-12 Section 23.003 and allege:
76-13 (1) the name and, if known, social security number of
76-14 the person;
76-15 (2) the type of license the person is believed to hold
76-16 and the name of the licensing authority; and
76-17 (3) the amount owed to the department.
76-18 Sec. 23.006. NOTICE. (a) On initiating a proceeding under
76-19 Section 23.004, the department shall give the person named in the
76-20 petition:
76-21 (1) notice of the person's right to a hearing before
76-22 the hearings division of the department;
76-23 (2) notice of the deadline for requesting a hearing;
76-24 and
76-25 (3) a form requesting a hearing.
77-1 (b) Notice under this section may be served as in civil
77-2 cases generally.
77-3 (c) The notice must state that an order suspending a license
77-4 shall be rendered on the 60th day after the date of service of the
77-5 notice unless by that date:
77-6 (1) the person pays the amount owed to the department;
77-7 (2) the person presents evidence of a payment history
77-8 satisfactory to the department in compliance with a reasonable
77-9 repayment schedule; or
77-10 (3) the person appears at a hearing before the
77-11 hearings division and shows that the request for suspension should
77-12 be denied or stayed.
77-13 Sec. 23.007. HEARING ON PETITION TO SUSPEND LICENSE. (a) A
77-14 request for a hearing and motion to stay suspension must be filed
77-15 with the department not later than the 20th day after the date of
77-16 service of the notice under Section 23.006.
77-17 (b) If a request for a hearing is filed, the hearings
77-18 division of the department shall:
77-19 (1) promptly schedule a hearing;
77-20 (2) notify the person and an appropriate
77-21 representative of the department of the date, time, and location of
77-22 the hearing; and
77-23 (3) stay suspension pending the hearing.
77-24 Sec. 23.008. ORDER SUSPENDING LICENSE. (a) On making the
77-25 findings required by Section 23.003, the department shall render an
78-1 order suspending a license.
78-2 (b) The department may stay an order suspending a license
78-3 conditioned on the person's compliance with a reasonable repayment
78-4 schedule that is incorporated in the order. An order suspending a
78-5 license with a stay of the suspension may not be served on the
78-6 licensing authority unless the stay is revoked as provided by this
78-7 chapter.
78-8 (c) A final order suspending a license rendered by the
78-9 department shall be forwarded to the appropriate licensing
78-10 authority.
78-11 (d) If the department renders an order suspending a license,
78-12 the person may also be ordered not to engage in the licensed
78-13 activity.
78-14 (e) If the department finds that the petition for suspension
78-15 should be denied, the petition shall be dismissed without
78-16 prejudice, and an order suspending a license may not be rendered.
78-17 Sec. 23.009. DEFAULT ORDER. The department shall consider
78-18 the allegations of the petition for suspension to be admitted and
78-19 shall render an order suspending a license if the person fails to:
78-20 (1) respond to a notice issued under Section 23.006;
78-21 (2) request a hearing; or
78-22 (3) appear at a hearing.
78-23 Sec. 23.010. REVIEW OF FINAL ADMINISTRATIVE ORDER. An order
78-24 issued by the department under this chapter is a final agency
78-25 decision and is subject to review as provided by Chapter 2001,
79-1 Government Code.
79-2 Sec. 23.011. ACTION BY LICENSING AUTHORITY. (a) On receipt
79-3 of a final order suspending a license, the licensing authority
79-4 shall immediately determine if the authority has issued a license
79-5 to the person named on the order and, if a license has been issued:
79-6 (1) record the suspension of the license in the
79-7 licensing authority's records;
79-8 (2) report the suspension as appropriate; and
79-9 (3) demand surrender of the suspended license if
79-10 required by law for other cases in which a license is suspended.
79-11 (b) A licensing authority shall implement the terms of a
79-12 final order suspending a license without additional review or
79-13 hearing. The authority may provide notice as appropriate to the
79-14 license holder or to others concerned with the license.
79-15 (c) A licensing authority may not modify, remand, reverse,
79-16 vacate, or stay an order suspending a license issued under this
79-17 chapter and may not review, vacate, or reconsider the terms of a
79-18 final order suspending a license.
79-19 (d) A person who is the subject of a final order suspending
79-20 a license is not entitled to a refund for any fee or deposit paid
79-21 to the licensing authority.
79-22 (e) A person who continues to engage in the licensed
79-23 activity after the implementation of the order suspending a license
79-24 by the licensing authority is liable for the same civil and
79-25 criminal penalties provided for engaging in the licensed activity
80-1 without a license or while a license is suspended that apply to any
80-2 other license holder of that licensing authority.
80-3 (f) A licensing authority is exempt from liability to a
80-4 license holder for any act authorized under this chapter performed
80-5 by the authority.
80-6 (g) Except as provided by this chapter, an order suspending
80-7 a license or dismissing a petition for the suspension of a license
80-8 does not affect the power of a licensing authority to grant, deny,
80-9 suspend, revoke, terminate, or renew a license.
80-10 (h) The denial or suspension of a driver's license under
80-11 this chapter is governed by this chapter and not by Subtitle B,
80-12 Title 7, Transportation Code.
80-13 Sec. 23.012. MOTION TO REVOKE STAY. (a) The department may
80-14 file a motion with the department's hearings division to revoke the
80-15 stay of an order suspending a license if the person does not comply
80-16 with the terms of a reasonable repayment plan entered into by the
80-17 person.
80-18 (b) Notice to the person of a motion to revoke stay under
80-19 this section may be given by personal service or by mail to the
80-20 address provided by the person, if any, in the order suspending a
80-21 license. The notice must include a notice of hearing before the
80-22 hearings division. The notice must be provided to the person not
80-23 less than 10 days before the date of the hearing.
80-24 (c) A motion to revoke stay must allege the manner in which
80-25 the person failed to comply with the repayment plan.
81-1 (d) If the department finds that the person is not in
81-2 compliance with the terms of the repayment plan, the department
81-3 shall revoke the stay of the order suspending a license and render
81-4 a final order suspending a license.
81-5 Sec. 23.013. VACATING OR STAYING ORDER SUSPENDING A LICENSE.
81-6 (a) The department may render an order vacating or staying an
81-7 order suspending a license if the person has paid all amounts owed
81-8 to the department or has established a satisfactory payment record.
81-9 (b) The department shall promptly deliver an order vacating
81-10 or staying an order suspending a license to the appropriate
81-11 licensing authority.
81-12 (c) On receipt of an order vacating or staying an order
81-13 suspending a license, the licensing authority shall promptly
81-14 reinstate and return the affected license to the person if the
81-15 person is otherwise qualified for the license.
81-16 (d) An order rendered under this section does not affect the
81-17 right of the department to any other remedy provided by law,
81-18 including the right to seek relief under this chapter. An order
81-19 rendered under this section does not affect the power of a
81-20 licensing authority to grant, deny, suspend, revoke, terminate, or
81-21 renew a license as otherwise provided by law.
81-22 Sec. 23.014. FEE BY LICENSING AUTHORITY. A licensing
81-23 authority may charge a fee to a person who is the subject of an
81-24 order suspending a license in an amount sufficient to recover the
81-25 administrative costs incurred by the authority under this chapter.
82-1 Sec. 23.015. COOPERATION BETWEEN LICENSING AUTHORITIES AND
82-2 DEPARTMENT. (a) The department may request from each licensing
82-3 authority the name, address, social security number, license
82-4 renewal date, and other identifying information for each individual
82-5 who holds, applies for, or renews a license issued by the
82-6 authority.
82-7 (b) A licensing authority shall provide the requested
82-8 information in the manner agreed to by the department and the
82-9 licensing authority.
82-10 (c) The department may enter into a cooperative agreement
82-11 with a licensing authority to administer this chapter in a
82-12 cost-effective manner.
82-13 (d) The department may adopt a reasonable implementation
82-14 schedule for the requirements of this section.
82-15 Sec. 23.016. RULES, FORMS, AND PROCEDURES. The department
82-16 by rule shall prescribe forms and procedures for the implementation
82-17 of this chapter.
82-18 (b) The Texas Department of Human Services shall take all
82-19 action necessary to implement the change in law made by this
82-20 article not later than January 1, 1998. The department may not
82-21 suspend a license because of a person's failure to reimburse the
82-22 department for a benefit granted in error under the food stamp
82-23 program or the program of financial assistance under Chapter 31,
82-24 Human Resources Code, before September 1, 1997.
83-1 ARTICLE 6. MEASUREMENT OF FRAUD
83-2 SECTION 6.01. HEALTH CARE FRAUD STUDY. (a) Subchapter B,
83-3 Chapter 403, Government Code, is amended by adding Section 403.026
83-4 to read as follows:
83-5 Sec. 403.026. HEALTH CARE FRAUD STUDY. (a) The comptroller
83-6 shall conduct a study each biennium to determine the number and
83-7 type of fraudulent claims for medical or health care benefits
83-8 submitted:
83-9 (1) under the state Medicaid program;
83-10 (2) under group health insurance programs administered
83-11 through the Employees Retirement System of Texas for active and
83-12 retired state employees; or
83-13 (3) by or on behalf of a state employee and
83-14 administered by the attorney general under Chapter 501, Labor Code.
83-15 (b) A state agency that administers a program identified by
83-16 Subsection (a) shall cooperate with the comptroller and provide any
83-17 information required by the comptroller in connection with the
83-18 study. A state agency may enter into a memorandum of understanding
83-19 with the comptroller regarding the use and confidentiality of the
83-20 information provided. This subsection does not require a state
83-21 agency to provide confidential information if release of the
83-22 information is prohibited by law.
83-23 (c) The comptroller shall report the results of the study to
83-24 each state agency that administers a program included in the study
83-25 so that the agency may modify its fraud control procedures as
84-1 necessary.
84-2 (b) The comptroller of public accounts shall complete the
84-3 initial study required by Section 403.026, Government Code, as
84-4 added by this section, not later than December 1, 1998.
84-5 SECTION 6.02. COMPILATION OF STATISTICS. (a) Subchapter B,
84-6 Chapter 531, Government Code, is amended by adding Section 531.0215
84-7 to read as follows:
84-8 Sec. 531.0215. COMPILATION OF STATISTICS RELATING TO FRAUD.
84-9 The commission and each health and human services agency that
84-10 administers a part of the state Medicaid program shall maintain
84-11 statistics on the number, type, and disposition of fraudulent
84-12 claims for benefits submitted under the part of the program the
84-13 agency administers.
84-14 (b) Subchapter C, Chapter 501, Labor Code, is amended by
84-15 adding Section 501.0431 to read as follows:
84-16 Sec. 501.0431. COMPILATION OF STATISTICS RELATING TO FRAUD.
84-17 The director shall maintain statistics on the number, type, and
84-18 disposition of fraudulent claims for medical benefits under this
84-19 chapter.
84-20 (c) Subsection (a), Section 17, Texas Employees Uniform
84-21 Group Insurance Benefits Act (Article 3.50-2, Vernon's Texas
84-22 Insurance Code), is amended to read as follows:
84-23 (a) The trustee shall:
84-24 (1) make a continuing study of the operation and
84-25 administration of this Act, including surveys and reports of group
85-1 coverages and benefits available to employees and on the experience
85-2 thereof; and
85-3 (2) maintain statistics on the number, type, and
85-4 disposition of fraudulent claims for benefits under this Act.
85-5 ARTICLE 7. WAIVERS; EFFECTIVE DATE; EMERGENCY
85-6 SECTION 7.01. WAIVERS. If before implementing any provision
85-7 of this Act, a state agency determines that a waiver or
85-8 authorization from a federal agency is necessary for implementation
85-9 of that provision, the agency affected by the provision shall
85-10 request the waiver or authorization and may delay implementing that
85-11 provision until the waiver or authorization is granted.
85-12 SECTION 7.02. EFFECTIVE DATE. Except as otherwise provided
85-13 by this Act, this Act takes effect September 1, 1997.
85-14 SECTION 7.03. EMERGENCY. The importance of this legislation
85-15 and the crowded condition of the calendars in both houses create an
85-16 emergency and an imperative public necessity that the
85-17 constitutional rule requiring bills to be read on three several
85-18 days in each house be suspended, and this rule is hereby suspended,
85-19 and that this Act take effect and be in force according to its
85-20 terms, and it is so enacted.