AN ACT 1-1 relating to the formation of an integrated health care system by 1-2 the El Paso County Hospital District and a medical school. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Subchapter C, Chapter 281, Health and Safety 1-5 Code, is amended by adding Section 281.0517 to read as follows: 1-6 Sec. 281.0517. INTEGRATED HEALTH CARE SYSTEM. (a) In this 1-7 section: 1-8 (1) "Integrated health care system" means a nonprofit 1-9 corporation established and operated by a district and a medical 1-10 school to provide or arrange for comprehensive health care services 1-11 for residents of the district. 1-12 (2) "Provider" means a physician or a provider as 1-13 defined under Section 2, Texas Health Maintenance Organization Act 1-14 (Article 20A.02, Vernon's Texas Insurance Code). 1-15 (3) "Medical school" means a medical school governed 1-16 by Chapter 110, Education Code. 1-17 (b) The El Paso County Hospital District and a medical 1-18 school may establish and operate an integrated health care system. 1-19 (c) To provide or arrange for comprehensive health care 1-20 services, an integrated health care system created under this 1-21 section may: 1-22 (1) own, acquire, lease, or contract for all necessary 1-23 assets; 2-1 (2) enter into contracts with providers for the 2-2 provision of health care services directly or indirectly through 2-3 subcontract; 2-4 (3) provide or enter into a contract with an 2-5 individual or business entity under which the individual or entity 2-6 provides necessary management or administrative services for the 2-7 system and the system's providers; 2-8 (4) enter into a contract or other agreement with a 2-9 business or governmental entity under which the system is paid to 2-10 provide health care services; and 2-11 (5) enter into a fee-for-service, capitated, or 2-12 risk-sharing health care service arrangement. 2-13 (d) An integrated health care system that recites in its 2-14 articles of incorporation that it is created under this section is: 2-15 (1) subject to: 2-16 (A) Chapter 551, Government Code; 2-17 (B) Chapter 552, Government Code; 2-18 (C) the Texas Health Maintenance Organization 2-19 Act (Chapter 20A, Vernon's Texas Insurance Code); 2-20 (D) Article 21.52F, Insurance Code; and 2-21 (E) Chapter 262, Local Government Code; and 2-22 (2) a unit of local government for the purposes of 2-23 Chapter 101, Civil Practice and Remedies Code. 2-24 (e) Notwithstanding Subsection (d)(1)(A), an integrated 2-25 health care system created under this section may hold a closed 3-1 meeting to deliberate: 3-2 (1) pricing or financial planning relating to a bid or 3-3 negotiation for a contract to provide a service or product line, if 3-4 an open meeting would have a detrimental effect on the position of 3-5 the system in the bid or negotiation process; or 3-6 (2) a proposed new service or product line, if the 3-7 meeting is held before public announcement of the service or 3-8 product line. 3-9 (f) Notwithstanding Subsection (d)(1)(B), information 3-10 relating to the following is confidential and not subject to 3-11 disclosure: 3-12 (1) pricing or financial planning relating to a bid or 3-13 negotiation for a contract to provide a service or product line, if 3-14 disclosure would have a detrimental effect on the position of the 3-15 integrated health care system in the bid or negotiation process; or 3-16 (2) a proposed new service or product line, if 3-17 disclosure is requested before public announcement of the service 3-18 or product line. 3-19 (g) Subject to the requirements and limitations of the local 3-20 health care market, an integrated health care system created under 3-21 this section shall make reasonable efforts to include in its 3-22 provider group community providers other than the medical school 3-23 and a hospital of the El Paso County Hospital District. 3-24 SECTION 2. This Act takes effect September 1, 1997. 3-25 SECTION 3. The importance of this legislation and the 4-1 crowded condition of the calendars in both houses create an 4-2 emergency and an imperative public necessity that the 4-3 constitutional rule requiring bills to be read on three several 4-4 days in each house be suspended, and this rule is hereby suspended. _______________________________ _______________________________ President of the Senate Speaker of the House I hereby certify that S.B. No. 1824 passed the Senate on April 17, 1997, by a viva-voce vote; and that the Senate concurred in House amendment on May 24, 1997, by a viva-voce vote. _______________________________ Secretary of the Senate I hereby certify that S.B. No. 1824 passed the House, with amendment, on May 21, 1997, by a non-record vote. _______________________________ Chief Clerk of the House Approved: _______________________________ Date _______________________________ Governor