76R11240 CLG-F                           
         By Gray                                               H.B. No. 2236
         Substitute the following for H.B. No. 2236:
         By Gray                                           C.S.H.B. No. 2236
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to contracts for Medicaid managed care.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Section 533.004, Government Code, is amended by
 1-5     amending Subsection (a) and adding Subsection (e) to read as
 1-6     follows:
 1-7           (a)  In providing health care services through Medicaid
 1-8     managed care to recipients in a health care service region, the
 1-9     commission shall contract with any [at least one] managed care
1-10     organization in that region that:
1-11                 (1)  is licensed under the Texas Health Maintenance
1-12     Organization Act (Chapter 20A, Vernon's Texas Insurance Code) to
1-13     provide health care  in that region and that is:
1-14                       (A) [(1)]  wholly owned and operated by a
1-15     hospital district in that region;
1-16                       (B) [(2)]  created by a nonprofit corporation
1-17     that:
1-18                             (i) [(A)]  has a contract, agreement, or
1-19     other arrangement with a hospital district in that region or with a
1-20     municipality in that  region that owns a hospital licensed under
1-21     Chapter 241, Health and Safety Code, and has an obligation to
1-22     provide health care to indigent patients; and
1-23                             (ii) [(B)]  under the contract, agreement,
1-24     or other arrangement, assumes the obligation to provide health care
 2-1     to indigent  patients and leases, manages, or operates a hospital
 2-2     facility owned by the hospital district or municipality; or
 2-3                       (C) [(3)]  created by a nonprofit corporation
 2-4     that has a contract, agreement, or other arrangement with a
 2-5     hospital district in that region under which the nonprofit
 2-6     corporation acts as an agent of the district and assumes the
 2-7     district's obligation to arrange for services under the Medicaid
 2-8     expansion for children as authorized by Chapter 444, Acts of the
 2-9     74th Legislature, Regular Session, 1995; or
2-10                 (2)  holds a certificate of authority as a health
2-11     maintenance organization under Article 20A.05, Insurance Code, and
2-12     that is:
2-13                       (A)  certified under Section 5.01(a), Medical
2-14     Practice Act (Article 4495b, Vernon's Texas Civil Statutes); and
2-15                       (B)  created by The University of Texas Medical
2-16     Branch at Galveston.
2-17           (e)  For purposes of a managed care organization described by
2-18     Subsection (a)(2), "health care service region" or "region" means
2-19     the service area for which the managed care organization obtained a
2-20     certificate of authority as a health maintenance organization from
2-21     the Texas Department of Insurance before September 2, 1999.
2-22           SECTION 2.  The importance of this legislation and the
2-23     crowded condition of the calendars in both houses create an
2-24     emergency and an imperative public necessity that the
2-25     constitutional rule requiring bills to be read on three several
2-26     days in each house be suspended, and this rule is hereby suspended,
2-27     and that this Act take effect and be in force from and after its
 3-1     passage, and it is so enacted.