By:  Zaffirini, Moncrief, Madla                       S.B. No. 1164

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to Medicaid managed care contract compliance.

 1-2           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-3           SECTION 1.  Subchapter B, Chapter 32, Human Resources Code,

 1-4     is amended by adding Section 32.043 to read as follows:

 1-5           Sec. 32.043.  MANAGED CARE CONTRACT COMPLIANCE.  (a)  The

 1-6     department shall review each managed care organization that has

 1-7     contracted with the department to provide medical assistance to

 1-8     medical assistance recipients through a managed care plan issued by

 1-9     the organization to determine whether the organization is prepared

1-10     to meet its contractual obligations.

1-11           (b)(1)  The department shall require each managed care

1-12     organization that has contracted with the department to submit an

1-13     implementation plan not later than the 90th day before the date on

1-14     which the department plans to begin to provide medical assistance

1-15     through a managed care plan in a service area.  The implementation

1-16     plan must include:

1-17                       (A)  specific staffing patterns by function for

1-18     all operations, including enrollment, information systems, member

1-19     services, quality improvement, claims management, case management,

1-20     and provider and enrollee training; and

1-21                       (B)  specific time frames for demonstrating

1-22     preparedness for implementation before the date on which the

1-23     department plans to begin to provide medical assistance through a

 2-1     managed care plan in a service area.

 2-2                 (2)  The department shall respond within five working

 2-3     days if the implementation plan does not adequately meet

 2-4     preparedness guidelines.

 2-5                 (3)  The department shall require each managed care

 2-6     organization that has contracted with the department to submit

 2-7     status reports on the implementation plan not later than the 60th

 2-8     day and the 30th day before the date on which the department plans

 2-9     to begin to provide medical assistance through a managed care plan

2-10     in a service area and every 30th day after the department begins to

2-11     provide medical assistance through a managed care plan in a service

2-12     area until the 180th day of operations.

2-13           (c)  The department shall conduct a compliance and readiness

2-14     review of each managed care organization that contracts with the

2-15     state not later than the 15th day before the date on which the

2-16     department plans to begin the enrollment process in a service area

2-17     and again not later than the 15th day before the date on which the

2-18     department plans to begin to provide medical assistance through a

2-19     managed care plan in a service area.  The review shall include an

2-20     on-site inspection and tests of service authorization and claims

2-21     payment systems, complaint processing systems, and any other

2-22     process or system required by the contract.

2-23           (d)  The department may delay enrollment of medical

2-24     assistance recipients in a managed care plan if the review reveals

2-25     that the managed care organization is not prepared to meet its

 3-1     contractual obligations.

 3-2           SECTION 2.  This Act applies only to a contract with a

 3-3     managed care organization that the Health and Human Services

 3-4     Commission or an agency authorized by the commission enters into or

 3-5     renews on or after the effective date of this Act.  A contract with

 3-6     a managed care organization that the Health and Human Services

 3-7     Commission or an agency authorized by the commission enters into or

 3-8     renews before the effective date of this Act is governed by the law

 3-9     as it existed immediately before that date, and that law is

3-10     continued in effect for that purpose.

3-11           SECTION 3.  The importance of this legislation and the

3-12     crowded condition of the calendars in both houses create an

3-13     emergency and an imperative public necessity that the

3-14     constitutional rule requiring bills to be read on three several

3-15     days in each house be suspended, and this rule is hereby suspended,

3-16     and that this Act take effect and be in force from and after its

3-17     passage, and it is so enacted.