HBA-GUM S.B. 1589 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 1589 By: Zaffirini Public Health 4/27/1999 Engrossed BACKGROUND AND PURPOSE Texas expended $7.3 billion in 1997 on its Medicaid program, $3.8 billion of which was spent on acute care services. The 75th Texas Legislature directed the comptroller of public accounts (comptroller) to study the size and nature of fraud and overpayments in the Medicaid program and other state health care programs. The comptroller and the State Auditor's Office reported possible overpayments of approximately $162 million for Medicaid acute care services based on 1997 expenditures. The comptroller included recommendations in the Fraud Measurement Study for improving the state's ability to ensure that state health care program funds are properly expended. S.B. 1589 sets forth provisions for conducting a study of fraudulent medical or health care benefit claims submitted under certain state programs. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Redesignates Section 403.026, Government Code, as Section 403.028, and amends that section as follows: (a) Adds language to provide that the study to determine the number and type of fraudulent claims for medical or health care benefits submitted under the state Medicaid program which the comptroller of public accounts (comptroller) is required to conduct, is to be conducted in consultation with the office of the state auditor. Specifies that the state Medicaid program includes the Medicaid managed care program implemented under Chapter 533 (Implementation of Medicaid Managed Care Program). (b) Authorizes the comptroller or, at the request of the comptroller, a state agency that administers a program identified by Subsection (a), to make telephone contact with a person identified as receiving services for which benefits are provided under the program, to confirm delivery of services to a person. (c) Creates this subsection from existing text. Provides that the information must be provided in a certain specified format agreed to by the comptroller and the state agency that aids in identifying unusual or suspicious claims or patterns of claims. (d) Requires each state agency that administers a program identified by Subsection (a), in consultation with the comptroller and the office of the state auditor, to establish performance measures to be used to evaluate the agency's fraud control procedures. (e) Redesignated from existing Subsection (c). Provides that a report must indicate whether the level of fraud in each program included in the study has increased, decreased, or remained constant since the comptroller's last report. Makes conforming changes. SECTION 2. Emergency clause. Effective date: upon passage.