By Zaffirini S.B. No. 801
75R7068 KKA-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the consolidation of investigations of fraud in the
1-3 provision of health and human services and other improvements in
1-4 identifying and preventing fraud.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Chapter 531, Government Code, is amended by
1-7 adding Subchapter C to read as follows:
1-8 SUBCHAPTER C. MEDICAID AND OTHER WELFARE FRAUD, MISUSE,
1-9 OR OVERCHARGES
1-10 Sec. 531.101. AWARD FOR REPORTING MEDICAID FRAUD, MISUSE, OR
1-11 OVERCHARGES. (a) The commission may grant an award to an
1-12 individual who reports activity that constitutes fraud or misuse of
1-13 funds in the state Medicaid program or reports overcharges in the
1-14 program if the commission determines that the disclosure results in
1-15 the recovery of an overcharge or in the termination of the
1-16 fraudulent activity or misuse of funds.
1-17 (b) The commission shall determine the amount of an award.
1-18 The award must be equal to not less than 10 percent of the savings
1-19 to this state that result from the individual's disclosure. In
1-20 determining the amount of the award, the commission shall consider
1-21 how important the disclosure is in ensuring the fiscal integrity of
1-22 the program.
1-23 (c) An award under this section is subject to appropriation.
1-24 The award must be paid from money appropriated to or otherwise
2-1 available to the commission, and additional money may not be
2-2 appropriated to the commission for the purpose of paying the award.
2-3 (d) Payment of an award under this section from federal
2-4 funds is subject to the permissible use under federal law of funds
2-5 for this purpose.
2-6 Sec. 531.102. INVESTIGATIONS AND ENFORCEMENT OFFICE. (a)
2-7 The commission, through the commission's office of investigations
2-8 and enforcement, is responsible for the investigation of fraud in
2-9 the provision of health and human services and the enforcement of
2-10 state law relating to the provision of those services.
2-11 (b) The commission shall set clear objectives, priorities,
2-12 and performance standards for the office that emphasize:
2-13 (1) coordinating investigative efforts to aggressively
2-14 recover money;
2-15 (2) allocating resources to cases that have the
2-16 strongest supportive evidence and the greatest potential for
2-17 recovery of money; and
2-18 (3) maximizing opportunities for referral of cases to
2-19 the office of the attorney general.
2-20 (c) The commission shall cross-train office staff to enable
2-21 the staff to pursue priority Medicaid and welfare fraud and abuse
2-22 cases as necessary.
2-23 Sec. 531.103. LEARNING OR NEURAL NETWORK TECHNOLOGY.
2-24 (a) The commission shall use learning or neural network technology
2-25 to identify and deter fraud in the Medicaid program throughout this
2-26 state.
2-27 (b) The commission shall contract with a private or public
3-1 entity to develop and implement the technology.
3-2 (c) The technology must be capable of operating
3-3 independently from other computer systems.
3-4 (d) The commission shall require each health and human
3-5 services agency that performs any aspect of the state Medicaid
3-6 program to participate in the implementation and use of the
3-7 technology.
3-8 (e) The commission shall maintain all information necessary
3-9 to apply the technology to claims data covering a period of at
3-10 least two years.
3-11 (f) The commission shall refer cases identified by the
3-12 technology to the commission's office of investigations and
3-13 enforcement or the office of the attorney general, as appropriate.
3-14 Sec. 531.104. FRAUD AND ABUSE TRAINING. (a) The commission
3-15 shall provide annual training in detecting welfare fraud and abuse
3-16 to:
3-17 (1) personnel in the Texas Department of Health's
3-18 vendor drug bureau and medical appeals section; and
3-19 (2) each contractor who processes Medicaid claims.
3-20 (b) The training required under this section must encourage
3-21 individuals to refer suspicious activities to the office.
3-22 Sec. 531.105. PUBLIC ASSISTANCE FRAUD OVERSIGHT TASK FORCE.
3-23 (a) The Public Assistance Fraud Oversight Task Force advises and
3-24 assists the commission and the commission's office of
3-25 investigations and enforcement in improving the efficiency of fraud
3-26 investigations and collections.
3-27 (b) The task force is composed of a representative of the:
4-1 (1) attorney general's office, appointed by the
4-2 attorney general;
4-3 (2) comptroller's office, appointed by the
4-4 comptroller;
4-5 (3) Department of Public Safety, appointed by the
4-6 public safety director;
4-7 (4) state auditor's office, appointed by the state
4-8 auditor; and
4-9 (5) commission, appointed by the commissioner of
4-10 health and human services.
4-11 (c) The comptroller or the comptroller's designee serves as
4-12 the presiding officer of the task force. The task force may elect
4-13 any other necessary officers.
4-14 (d) The task force shall meet at least once each fiscal
4-15 quarter at the call of the presiding officer.
4-16 (e) The appointing agency is responsible for the expenses of
4-17 a member's service on the task force. Members of the task force
4-18 receive no additional compensation for serving on the task force.
4-19 (f) At least once each fiscal quarter, the commission's
4-20 office of investigations and enforcement shall provide to the task
4-21 force:
4-22 (1) information detailing:
4-23 (A) the number of fraud referrals made to the
4-24 office and the origin of each referral;
4-25 (B) the time spent investigating each case;
4-26 (C) the number of cases investigated each month,
4-27 by program and region;
5-1 (D) the dollar value of each fraud case that
5-2 results in a criminal conviction; and
5-3 (E) the number of cases the office rejects and
5-4 the reason for rejection, by region; and
5-5 (2) any additional information the task force
5-6 requires.
5-7 Sec. 531.106. FRAUD PREVENTION. (a) The commission's
5-8 office of investigations and enforcement shall compile and
5-9 disseminate accurate information and statistics relating to:
5-10 (1) fraud prevention; and
5-11 (2) post-fraud referrals received and accepted or
5-12 rejected from the commission's case management system or the case
5-13 management system of a health and human services agency.
5-14 (b) The commission shall:
5-15 (1) aggressively publicize successful fraud
5-16 prosecutions; and
5-17 (2) establish and promote a toll-free hotline for
5-18 reporting suspected fraud in programs administered by the
5-19 commission or a health and human services agency.
5-20 (c) The commission shall develop a cost-effective method of
5-21 identifying applicants for public assistance in counties bordering
5-22 other states and in metropolitan areas selected by the commission
5-23 who are already receiving benefits in other states. If
5-24 economically feasible, the commission may develop a computerized
5-25 matching system.
5-26 (d) The commission shall:
5-27 (1) verify automobile information that is used as
6-1 criteria for eligibility; and
6-2 (2) establish a computerized matching system with the
6-3 Texas Department of Criminal Justice to prevent an incarcerated
6-4 individual from illegally receiving public assistance benefits
6-5 administered by the commission.
6-6 Sec. 531.107. DISPOSITION OF FUNDS. (a) The commission
6-7 shall deposit the state's share of money collected under this
6-8 subchapter in a special account in the state treasury.
6-9 (b) The commission may spend money in the account for the
6-10 administration of this subchapter, subject to the General
6-11 Appropriations Act.
6-12 SECTION 2. (a) On September 1, 1997, or an earlier date
6-13 provided by an interagency agreement with the affected agencies:
6-14 (1) all powers, duties, functions, programs, and
6-15 activities performed by or assigned to the Texas Department of
6-16 Human Services' office of inspector general immediately before
6-17 September 1, 1997, are transferred to the Health and Human Services
6-18 Commission;
6-19 (2) all funds, obligations, contracts, property, and
6-20 records of the Texas Department of Human Services' office of
6-21 inspector general are transferred to the Health and Human Services
6-22 Commission; and
6-23 (3) all employees of the Texas Department of Human
6-24 Services' office of inspector general become employees of the
6-25 Health and Human Services Commission, to be assigned duties by the
6-26 commissioner of health and human services.
6-27 (b) A rule or form adopted by the Texas Department of Human
7-1 Services that relates to the office of inspector general is a rule
7-2 or form of the Health and Human Services Commission and remains in
7-3 effect until altered by the commission. The secretary of state is
7-4 authorized to adopt rules as necessary to expedite the
7-5 implementation of this subsection.
7-6 SECTION 3. (a) On September 1, 1997, or an earlier date
7-7 provided by an interagency agreement with the affected agencies:
7-8 (1) all powers, duties, functions, programs, and
7-9 activities performed by or assigned to the Texas Department of
7-10 Health's policy and analysis group immediately before September 1,
7-11 1997, are transferred to the Health and Human Services Commission;
7-12 (2) all funds, obligations, contracts, property, and
7-13 records of the Texas Department of Health's policy and analysis
7-14 group are transferred to the Health and Human Services Commission;
7-15 and
7-16 (3) all employees of the Texas Department of Health's
7-17 policy and analysis group become employees of the Health and Human
7-18 Services Commission, to be assigned duties by the commissioner of
7-19 health and human services.
7-20 (b) A rule or form adopted by the Texas Department of Health
7-21 that relates to the policy and analysis group is a rule or form of
7-22 the Health and Human Services Commission and remains in effect
7-23 until altered by the commission. The secretary of state is
7-24 authorized to adopt rules as necessary to expedite the
7-25 implementation of this subsection.
7-26 SECTION 4. (a) The commissioner of health and human
7-27 services shall oversee and assist in the transfer of powers,
8-1 duties, functions, programs, and activities prescribed by Sections
8-2 2 and 3 of this Act.
8-3 (b) The commissioner of health and human services shall
8-4 determine for each power, duty, function, program, or activity
8-5 scheduled for transfer:
8-6 (1) the relevant agency actions that constitute each
8-7 power, duty, function, program, or activity;
8-8 (2) the relevant records, property, and equipment used
8-9 by a state agency for each power, duty, function, program, or
8-10 activity;
8-11 (3) the state agency employees whose primary duties
8-12 involve a power, duty, function, program, or activity; and
8-13 (4) state agency funds and obligations that are
8-14 related to the power, duty, function, program, or activity.
8-15 (c) Based on the determinations made under Subsection (b) of
8-16 this section, the commissioner of health and human services shall
8-17 assist the agencies in transferring powers, duties, functions,
8-18 programs, activities, records, equipment, property, funds,
8-19 obligations, and employees in accordance with the transfer
8-20 schedule.
8-21 (d) The commissioner of health and human services shall file
8-22 any federal plan changes required by this Act.
8-23 SECTION 5. (a) The transfer of powers, duties, functions,
8-24 programs, and activities under this Act does not affect or impair
8-25 any act done, any obligation, right, order, license, permit, rule,
8-26 criterion, standard, or requirement existing, any investigation
8-27 begun, or any penalty accrued under former law, and that law
9-1 remains in effect for any action concerning those matters.
9-2 (b) An action brought or proceeding commenced before the
9-3 effective date of this Act, including a contested case or a remand
9-4 of an action or proceeding by a reviewing court, is governed by the
9-5 law and rules applicable to the action or proceeding before the
9-6 effective date of this Act.
9-7 SECTION 6. If the Health and Human Services Commission and
9-8 the affected agencies do not complete the transfers required by
9-9 Sections 2 and 3 of this Act on or before September 1, 1997, the
9-10 commissioner of health and human services shall enter into an
9-11 interagency agreement with the comptroller to enable the
9-12 comptroller to contract for or conduct Medicaid investigations with
9-13 the comptroller or other designated staff. In addition to the
9-14 interagency agreement, the commissioner of health and human
9-15 services and the comptroller shall execute a memorandum of
9-16 understanding to ensure that the comptroller has access to all
9-17 necessary staff from health and human service agencies to conduct
9-18 the investigations.
9-19 SECTION 7. Not later than September 1, 1997, the Health and
9-20 Human Services Commission shall award the contract for the learning
9-21 or neural network technology required by Section 531.103,
9-22 Government Code, as added by this Act, and the contractor shall
9-23 begin operations not later than that date. If the commission fails
9-24 to award the contract or the contractor cannot begin operations on
9-25 or before September 1, 1997, the commissioner of health and human
9-26 services shall enter into an interagency agreement with the
9-27 comptroller to enable the comptroller to perform the duties
10-1 prescribed by Section 531.103. In addition to the interagency
10-2 agreement, the commissioner of health and human services and the
10-3 comptroller shall execute a memorandum of understanding to ensure
10-4 that the comptroller receives all data and resources necessary to
10-5 operate the learning or neural network technology system.
10-6 SECTION 8. (a) In addition to the substantive changes in
10-7 law made by this Act, Section 1 of this Act, in adding Section
10-8 531.101, Government Code, conforms to changes in the law made by
10-9 Section 1, Chapter 444, Acts of the 74th Legislature, Regular
10-10 Session, 1995.
10-11 (b) Section 16G, Article 4413(502), Revised Statutes, as
10-12 added by Section 1, Chapter 444, Acts of the 74th Legislature,
10-13 Regular Session, 1995, is repealed.
10-14 (c) To the extent of any conflict, this Act prevails over
10-15 another Act of the 75th Legislature, Regular Session, 1997,
10-16 relating to nonsubstantive additions to and corrections in enacted
10-17 codes.
10-18 SECTION 9. Sections 21.0145 and 22.027, Human Resources
10-19 Code, are repealed.
10-20 SECTION 10. The importance of this legislation and the
10-21 crowded condition of the calendars in both houses create an
10-22 emergency and an imperative public necessity that the
10-23 constitutional rule requiring bills to be read on three several
10-24 days in each house be suspended, and this rule is hereby suspended,
10-25 and that this Act take effect and be in force from and after its
10-26 passage, and it is so enacted.