By Turner of Harris H.B. No. 1572
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the authority of physicians and podiatrists to form
1-3 certain jointly owned entities and to the authority of certain
1-4 medical schools to employ physicians.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subsection A, Article 11.01, Texas Limited
1-7 Liability Company Act (Article 1528n, Vernon's Texas Civil
1-8 Statutes), is amended to read as follows:
1-9 A. (1) One or more persons may organize a professional
1-10 limited liability company by filing articles of organization with
1-11 the Secretary of State in accordance with Part Three of this Act.
1-12 In addition to other provisions required or permitted by law, the
1-13 articles of organization of a professional limited liability
1-14 company must include a statement:
1-15 (a) that the limited liability company is a
1-16 professional limited liability company; and
1-17 (b) describing the [one] specific kind of
1-18 professional service to be rendered by the limited liability
1-19 company.
1-20 (2) Except as provided by Subdivision (3) of this
1-21 subsection, a [A] professional limited liability company:
1-22 (a) may be organized under this Act only for the
1-23 purpose of rendering one specific type of professional service and
1-24 ancillary services; and
2-1 (b) [. A professional limited liability company
2-2 organized under this Act] may not render more than one kind of
2-3 professional service.
2-4 (3) Doctors of medicine and osteopathy licensed by the
2-5 Texas State Board of Medical Examiners and podiatrists licensed by
2-6 the Texas State Board of Podiatric Medical Examiners may organize a
2-7 professional limited liability company that is jointly owned by
2-8 those practitioners to perform a professional service that falls
2-9 within the scope of practice of those practitioners. When doctors
2-10 of medicine, osteopathy, and podiatry organize a professional
2-11 limited liability company that is jointly owned by those
2-12 practitioners, the authority of each of the practitioners is
2-13 limited by the scope of practice of the respective practitioners
2-14 and none can exercise control over the other's clinical authority
2-15 granted by their respective licenses, either through agreements,
2-16 bylaws, directives, financial incentives, or other arrangements
2-17 that would assert control over treatment decisions made by the
2-18 practitioner. The Texas State Board of Medical Examiners and the
2-19 Texas State Board of Podiatric Medical Examiners continue to
2-20 exercise regulatory authority over their respective licenses.
2-21 SECTION 2. Article 2.01, Texas Non-Profit Corporation Act
2-22 (Article 1396-2.01, Vernon's Texas Civil Statutes), is amended by
2-23 amending Subsection B and adding Subsections C and D to read as
2-24 follows:
2-25 B. This Act shall not apply to any corporation, nor may any
2-26 corporation be organized under this Act or obtain authority to
2-27 conduct its affairs in this State under this Act:
3-1 (1) If any one or more of its purposes for the conduct
3-2 of its affairs in this State is expressly forbidden by any law of
3-3 this State.
3-4 (2) If any one or more of its purposes for the conduct
3-5 of its affairs in this State is to engage in any activity which
3-6 cannot lawfully be engaged in without first obtaining a license
3-7 under the authority of the laws of this State to engage in such
3-8 activity and such license cannot lawfully be granted to a
3-9 corporation, except as provided by Subsection C.
3-10 (3) If any one or more of its purposes for the conduct
3-11 of its affairs in this State is to organize Group Hospital Service,
3-12 Rural Credit Unions, Agricultural and Livestock Pools, Mutual Loan
3-13 Corporations, Co-operative Credit Associations, Farmers'
3-14 Co-operative Societies, Co-operative Marketing Act Corporations,
3-15 Rural Electric Co-operative Corporations, Telephone Co-operative
3-16 Corporations, or fraternal organizations operating under the lodge
3-17 system and heretofore or hereafter incorporated under Articles 1399
3-18 through 1407, both inclusive, of Revised Civil Statutes of Texas,
3-19 1925.
3-20 (4) If any one or more of its purposes for the conduct
3-21 of its affairs in this State is to operate a bank under the banking
3-22 laws of this State or to operate an insurance company of any type
3-23 or character that operates under the insurance laws of this State.
3-24 (5) If any one or more of its purposes for the conduct
3-25 of its affairs in this State is to engage in water or sewer service
3-26 and it has heretofore or is hereafter incorporated under the Acts
3-27 of 1933, Forty-third Legislature, First Called Session, Chapter 76,
4-1 as amended, Acts of 1941, Forty-seventh Legislature, page 666,
4-2 Chapter 407, being presently identified as Article 1434(a), Revised
4-3 Civil Statutes of Texas, 1925.
4-4 C. Doctors of medicine and osteopathy licensed by the Texas
4-5 State Board of Medical Examiners and podiatrists licensed by the
4-6 Texas State Board of Podiatric Medical Examiners may organize a
4-7 non-profit corporation under this Act that is jointly owned,
4-8 managed, and controlled by those practitioners to perform a
4-9 professional service that falls within the scope of practice of
4-10 those practitioners and consists of:
4-11 (1) carrying out research in the public interest in
4-12 medical science, medical economics, public health, sociology, or a
4-13 related field;
4-14 (2) supporting medical education in medical schools
4-15 through grants or scholarships;
4-16 (3) developing the capabilities of individuals or
4-17 institutions studying, teaching, or practicing medicine, including
4-18 podiatric medicine;
4-19 (4) delivering health care to the public; or
4-20 (5) instructing the public regarding medical science,
4-21 public health, hygiene, or a related matter.
4-22 D. When doctors of medicine, osteopathy, and podiatry
4-23 organize a non-profit corporation that is jointly owned by those
4-24 practitioners, the authority of each of the practitioners is
4-25 limited by the scope of practice of the respective practitioners
4-26 and none can exercise control over the other's clinical authority
4-27 granted by their respective licenses, either through agreements,
5-1 articles of incorporation, bylaws, directives, financial
5-2 incentives, or other arrangements that would assert control over
5-3 treatment decisions made by the practitioner. The Texas State
5-4 Board of Medical Examiners and the Texas State Board of Podiatric
5-5 Medical Examiners continue to exercise regulatory authority over
5-6 their respective licenses.
5-7 SECTION 3. Section 2.02, Texas Revised Partnership Act
5-8 (Article 6132b-2.02, Vernon's Texas Civil Statutes), is amended by
5-9 adding Subsection (e) to read as follows:
5-10 (e) Authority of Doctors of Medicine and Osteopathy and
5-11 Podiatrists to Create Partnership. Doctors of medicine and
5-12 osteopathy licensed by the Texas State Board of Medical Examiners
5-13 and podiatrists licensed by the Texas State Board of Podiatric
5-14 Medical Examiners may create a partnership that is jointly owned by
5-15 those practitioners to perform a professional service that falls
5-16 within the scope of practice of those practitioners. When doctors
5-17 of medicine, osteopathy, and podiatry create a partnership that is
5-18 jointly owned by those practitioners, the authority of each of the
5-19 practitioners is limited by the scope of practice of the respective
5-20 practitioners and none can exercise control over the other's
5-21 clinical authority granted by their respective licenses, either
5-22 through agreements, bylaws, directives, financial incentives, or
5-23 other arrangements that would assert control over treatment
5-24 decisions made by the practitioner. The Texas State Board of
5-25 Medical Examiners and the Texas State Board of Podiatric Medical
5-26 Examiners continue to exercise regulatory authority over their
5-27 respective licenses.
6-1 SECTION 4. Subchapter E, Medical Practice Act (Article
6-2 4495b, Vernon's Texas Civil Statutes), is amended by adding Section
6-3 5.12 to read as follows:
6-4 Sec. 5.12. EMPLOYMENT OF PHYSICIANS BY PRIVATE MEDICAL
6-5 SCHOOL. A private medical school accredited by the Liaison
6-6 Committee on Medical Education, in fulfilling its mission, may:
6-7 (1) employ or contract for the services of physicians
6-8 to provide medical services; and
6-9 (2) retain all or part of the professional income
6-10 generated by a physician providing medical services under
6-11 Subdivision (1).
6-12 SECTION 5. The importance of this legislation and the
6-13 crowded condition of the calendars in both houses create an
6-14 emergency and an imperative public necessity that the
6-15 constitutional rule requiring bills to be read on three several
6-16 days in each house be suspended, and this rule is hereby suspended,
6-17 and that this Act take effect and be in force from and after its
6-18 passage, and it is so enacted.