By Zaffirini, et al.                            S.B. No. 1164

      75R5905 SAW-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to Medicaid managed care contract compliance.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Subchapter B, Chapter 32, Human Resources Code,

 1-5     is amended by adding Section 32.043 to read as follows:

 1-6           Sec. 32.043.  MANAGED CARE CONTRACT COMPLIANCE.  (a)  The

 1-7     department shall review each managed care organization that has

 1-8     contracted with the department to provide medical assistance to

 1-9     medical assistance recipients through a managed care plan issued by

1-10     the organization to determine whether the organization is prepared

1-11     to meet its contractual obligations.

1-12           (b)  The department shall conduct the review not later than

1-13     the 60th day before the date on which medical assistance recipients

1-14     may begin enrolling in the organization's managed care plan.

1-15           (c)  The review shall include an on-site inspection and tests

1-16     of service authorization and claims payment systems, complaint

1-17     processing systems, and any other process or system required by the

1-18     contract.

1-19           (d)  The department may delay enrollment of medical

1-20     assistance recipients in a managed care plan if the review reveals

1-21     that the managed care organization is not prepared to meet its

1-22     contractual obligations.

1-23           (e)  The department shall identify and review the

1-24     administrative costs of each managed care organization that

 2-1     contracts with the department.  The department by rule may limit

 2-2     these administrative costs.

 2-3           SECTION 2.  This Act takes effect September 1, 1997, and

 2-4     applies only to a contract with a managed care organization that

 2-5     the department enters into or renews on or after that date.  A

 2-6     contract with a managed care organization that the department

 2-7     enters into or renews before September 1, 1997, is governed by the

 2-8     law as it existed immediately before that date, and that law is

 2-9     continued in effect for that purpose.

2-10           SECTION 3.  The importance of this legislation and the

2-11     crowded condition of the calendars in both houses create an

2-12     emergency and an imperative public necessity that the

2-13     constitutional rule requiring bills to be read on three several

2-14     days in each house be suspended, and this rule is hereby suspended.