By Shapleigh                                    S.B. No. 1824

      75R8026 SAW-F                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the formation of an integrated health care system by a

 1-3     hospital district and a public medical school.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Subchapter C, Chapter 281, Health and Safety

 1-6     Code, is amended by adding Section 281.0517 to read as follows:

 1-7           Sec. 281.0517.  INTEGRATED HEALTH CARE SYSTEM.  (a)  In this

 1-8     section:

 1-9                 (1)  "Integrated health care system" means a nonprofit

1-10     corporation established and operated by a district and a public

1-11     medical school to provide or arrange for comprehensive health care

1-12     services for residents of the district.

1-13                 (2)  "Provider" means a physician or a provider as

1-14     defined under Section 2, Texas Health Maintenance Organization Act

1-15     (Article 20A.02, Vernon's Texas Insurance Code).

1-16                 (3)  "Public medical school" means an accredited

1-17     medical school established and maintained by a state university for

1-18     the education and training of medical doctors or doctors of

1-19     osteopathy.

1-20           (b)  A district and a public medical school may establish and

1-21     operate an integrated health care system.

1-22           (c)  To provide or arrange for comprehensive health care

1-23     services, an integrated health care system may:

1-24                 (1)  own, acquire, lease, or contract for all necessary

 2-1     assets;

 2-2                 (2)  enter into contracts with providers for the

 2-3     provision of health care services directly or indirectly through

 2-4     subcontract;

 2-5                 (3)  provide or enter into a contract with an

 2-6     individual or business entity under which the individual or entity

 2-7     provides necessary administrative services for the system and the

 2-8     system's providers;

 2-9                 (4)  enter into a contract or other agreement with a

2-10     business or governmental entity under which the system is paid to

2-11     provide health care services; and

2-12                 (5)  enter into a fee-for-service, capitated, or

2-13     risk-sharing health care service arrangement.

2-14           (d)  An integrated health care system created under this

2-15     section is:

2-16                 (1)  subject to:

2-17                       (A)  Chapter 551, Government Code;

2-18                       (B)  Chapter 552, Government Code;

2-19                       (C)  the Texas Health Maintenance Organization

2-20     Act (Chapter 20A, Vernon's  Texas Insurance Code); and

2-21                       (D)  Article 21.52F, Insurance 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 may hold a closed meeting to deliberate:

2-26                 (1)  pricing or financial planning relating to a bid or

2-27     negotiation for a contract to provide a service or product line, if

 3-1     an open meeting would have a detrimental effect on the position of

 3-2     the system in the bid or negotiation process; or

 3-3                 (2)  a proposed new service or product line, if the

 3-4     meeting is held before public announcement of the service or

 3-5     product line.

 3-6           (f)  Notwithstanding Subsection (d)(1)(B), information

 3-7     relating to the following is confidential and not subject to

 3-8     disclosure:

 3-9                 (1)  pricing or financial planning relating to a bid or

3-10     negotiation for a contract to provide a service or product line, if

3-11     disclosure would have a detrimental effect on the position of the

3-12     system in the bid or negotiation process; or

3-13                 (2)  a proposed new service or product line, if

3-14     disclosure is requested before public announcement of the service

3-15     or product line.

3-16           SECTION 2.  This Act takes effect September 1, 1997.

3-17           SECTION 3.  The importance of this legislation and the

3-18     crowded condition of the calendars in both houses create an

3-19     emergency and an imperative public necessity that the

3-20     constitutional rule requiring bills to be read on three several

3-21     days in each house be suspended, and this rule is hereby suspended.