1-1     By:  Zaffirini, Ellis                                   S.B. No. 18
 1-2           (In the Senate - Filed November 9, 1998; January 26, 1999,
 1-3     read first time and referred to Committee on Health Services;
 1-4     February 1, 1999, rereferred to Committee on Human Services;
 1-5     February 15, 1999, reported adversely, with favorable Committee
 1-6     Substitute by the following vote:  Yeas 4, Nays 0;
 1-7     February 15, 1999, sent to printer.)
 1-8     COMMITTEE SUBSTITUTE FOR S.B. No. 18                 By:  Zaffirini
 1-9                            A BILL TO BE ENTITLED
1-10                                   AN ACT
1-11     relating to the representation of the state by the attorney general
1-12     in certain cases involving nursing facilities.
1-13           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-14           SECTION 1.  Section 242.065, Health and Safety Code, is
1-15     amended by relettering existing Subsections (f), (g), and (h) as
1-16     Subsections (g), (h), and (i) and adding a new Subsection (f) to
1-17     read as follows:  
1-18           (f)  On request by the department, the attorney general may
1-19     institute an action in a district court to collect a civil penalty
1-20     under this section.
1-21           (g)  A payment made to satisfy an obligation under this
1-22     section is not an allowable cost for reimbursement under the state
1-23     Medicaid program.
1-24           (h) [(g)]  A civil penalty awarded under this section
1-25     constitutes a fine, penalty, or forfeiture payable to and for the
1-26     benefit of a government unit and is not compensation for actual
1-27     pecuniary loss.
1-28           (i) [(h)]  In this section, "affiliate" means:
1-29                 (1)  with respect to a partnership other than a limited
1-30     partnership, each partner of the partnership;
1-31                 (2)  with respect to a corporation:
1-32                       (A)  an officer;
1-33                       (B)  a director;
1-34                       (C)  a stockholder who owns, holds, or has the
1-35     power to vote at least 10 percent of any class of securities issued
1-36     by the corporation, regardless of whether the power is of record or
1-37     beneficial; and
1-38                       (D)  a controlling individual;
1-39                 (3)  with respect to an individual:
1-40                       (A)  each partnership and each partner in the
1-41     partnership in which the individual or any other affiliate of the
1-42     individual is a partner; and
1-43                       (B)  each corporation or other business entity in
1-44     which the individual or another affiliate of the individual is:
1-45                             (i)  an officer;
1-46                             (ii)  a director;
1-47                             (iii)  a stockholder who owns, holds, or
1-48     has the power to vote at least 10 percent of any class of
1-49     securities issued by the corporation, regardless of whether the
1-50     power is of record or beneficial; and
1-51                             (iv)  a controlling individual;
1-52                 (4)  with respect to a limited partnership:
1-53                       (A)  a general partner; and
1-54                       (B)  a limited partner who is a controlling
1-55     individual;
1-56                 (5)  with respect to a limited liability company:
1-57                       (A)  an owner who is a manager as described by
1-58     the Texas Limited Liability Company Act (Article 1528n, Vernon's
1-59     Texas Civil Statutes); and
1-60                       (B)  each owner who is a controlling individual;
1-61     and
1-62                 (6)  with respect to any other business entity, a
1-63     controlling individual.
1-64           SECTION 2.  Section 242.253, Health and Safety Code, is
 2-1     amended by adding Subsection (e) to read as follows:
 2-2           (e)  On request by the department, the attorney general may
 2-3     represent the department in the arbitration.
 2-4           SECTION 3.  The importance of this legislation and the
 2-5     crowded condition of the calendars in both houses create an
 2-6     emergency and an imperative public necessity that the
 2-7     constitutional rule requiring bills to be read on three several
 2-8     days in each house be suspended, and this rule is hereby suspended,
 2-9     and that this Act take effect and be in force from and after its
2-10     passage, and it is so enacted.
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