By: Patterson S.B. No. 276 A BILL TO BE ENTITLED AN ACT 1-1 relating to organizational and health maintenance organization 1-2 requirements for community centers to provide certain services 1-3 under capitation and other at-risk agreements in plans approved by 1-4 the Texas Department of Mental Health and Mental Retardation. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. Chapter 534, Health and Safety Code, is amended 1-7 by adding Subchapter C to read as follows: 1-8 SUBCHAPTER C. HEALTH MAINTENANCE ORGANIZATIONS 1-9 Sec. 534.101. HEALTH MAINTENANCE ORGANIZATION CERTIFICATE OF 1-10 AUTHORITY. (a) One or more community centers may create or 1-11 operate a nonprofit corporation pursuant to the laws of this state 1-12 for the purpose of accepting capitated or other at-risk payment 1-13 arrangements for the provision of services designated in a plan 1-14 approved by the department under Subchapter A. 1-15 (b) Before a nonprofit corporation organized or operating 1-16 under Subsection (a) accepts or enters into any capitated or other 1-17 at-risk payment arrangement for services designated in a plan 1-18 approved by the department under Subchapter A, the nonprofit 1-19 corporation must obtain the appropriate certificate of authority 1-20 from the Texas Department of Insurance to operate as a health 1-21 maintenance organization pursuant to the Texas Health Maintenance 1-22 Organization Act (Chapter 20A, Vernon's Texas Insurance Code). 1-23 (c)(1) Prior to submitting any bids, a nonprofit corporation 2-1 operating under this subchapter shall disclose in writing to the 2-2 department those services to be provided by the community center 2-3 through any capitated or other at-risk payment arrangement by the 2-4 nonprofit corporation. The department shall verify that the 2-5 services provided under any capitated or other at-risk payment 2-6 arrangement are within the scope of services approved by the 2-7 department in each community center's plan required under 2-8 Subchapter A. 2-9 (2) The board shall: 2-10 (A) provide for public notice of the nonprofit 2-11 corporation's intent to submit a bid to provide or arrange services 2-12 through a capitated or other at-risk payment arrangement through 2-13 placement as a board agenda item on the next regularly scheduled 2-14 board meeting which allows at least 15 days' public review of the 2-15 plan; and 2-16 (B) provide an opportunity for public comment on 2-17 the services to be provided through such arrangements and on the 2-18 consideration of local input into the plan. 2-19 (3) The nonprofit corporation shall provide: 2-20 (A) public notice prior to such verification and 2-21 disclosure of services to be provided by the community center 2-22 through any capitated or other at-risk payment arrangements by the 2-23 nonprofit corporation; 2-24 (B) an opportunity for public comment on the 2-25 community center services within the capitated or other at-risk 3-1 payment arrangements offered by the nonprofit corporation; 3-2 (C) published summaries of all relevant 3-3 documentation concerning community center services arranged through 3-4 the nonprofit corporation, including summaries of any other similar 3-5 contracts the nonprofit corporation has entered into; and 3-6 (D) public access and review of all relevant 3-7 documentation. 3-8 (d) A nonprofit corporation operating under this subchapter 3-9 shall: 3-10 (1) be subject to the requirements of the open 3-11 meetings law, Chapter 551, Government Code, and the open records 3-12 law, Chapter 552, Government Code; 3-13 (2) solicit public input as to the operations of the 3-14 nonprofit corporation and allow public access to information 3-15 regarding such operations, including services, administration, 3-16 governance, revenues, and expenses, on request unless disclosure is 3-17 expressly prohibited by law or the information is confidential 3-18 under law; and 3-19 (3) publish an annual report detailing the services, 3-20 administration, governance, revenues, and expenses of the nonprofit 3-21 corporation, including the disposition of any excess revenues. 3-22 Sec. 534.102. LAWS AND RULES. A nonprofit corporation 3-23 created or operated pursuant to the authority of this subchapter 3-24 which obtains and holds a valid certificate of authority as a 3-25 health maintenance organization may exercise the powers and 4-1 authority and is subject to the conditions and limitations provided 4-2 by this subchapter, the Texas Health Maintenance Organization Act 4-3 (Chapter 20A, Vernon's Texas Insurance Code), the Texas Non-Profit 4-4 Corporation Act (Article 1396-1.01, et seq., Vernon's Texas Civil 4-5 Statutes), and rules of the Texas Department of Insurance. 4-6 Sec. 534.103. APPLICATION OF LAWS AND RULES. A health 4-7 maintenance organization created and operating under this 4-8 subchapter shall be governed as, and is subject to the same laws 4-9 and rules of the Texas Department of Insurance as, any other health 4-10 maintenance organization of the same type. 4-11 Sec. 534.104. APPLICATION OF SPECIFIC LAWS. (a) A health 4-12 maintenance organization created and operating under this 4-13 subchapter is a governmental unit and a unit of local government, 4-14 as those terms are defined and specified by Chapters 101 and 102, 4-15 Civil Practice and Remedies Code, and a local government as defined 4-16 by Section 791.003, Government Code. 4-17 (b) Nothing in this subchapter precludes one or more 4-18 community centers from forming a nonprofit corporation under 4-19 Section 5.01, Medical Practice Act (Article 4495b, Vernon's Texas 4-20 Civil Statutes), to provide services on a risk-sharing or capitated 4-21 basis as permitted under Article 21.52F, Insurance Code. 4-22 SECTION 2. The Texas Department of Insurance shall adopt 4-23 rules by September 1, 1997, which describe the procedures an entity 4-24 must follow and the standards an entity must meet to obtain a 4-25 certificate of authority as a single health care service plan 5-1 providing behavioral health care services. 5-2 SECTION 3. This Act takes effect September 1, 1997. 5-3 SECTION 4. The importance of this legislation and the 5-4 crowded condition of the calendars in both houses create an 5-5 emergency and an imperative public necessity that the 5-6 constitutional rule requiring bills to be read on three several 5-7 days in each house be suspended, and this rule is hereby suspended. 5-8 COMMITTEE AMENDMENT NO. 1 5-9 Amend S.B. No. 276 in Section 1 of the bill, following 5-10 proposed Section 534.104, Health and Safety Code (senate 5-11 engrossment, page 4, between lines 21 and 22), by inserting: 5-12 Sec. 534.105. CONSIDERATION OF BIDS. The department shall 5-13 give equal consideration to bids submitted by a for-profit entity 5-14 and a nonprofit entity if the department accepts bids to provide 5-15 services through a capitated or at-risk payment arrangement. 5-16 75R15466 SKB-F Berlanga