1-1     By:  Madla                                             S.B. No. 780
 1-2           (In the Senate - Filed March 2, 1999; March 3, 1999, read
 1-3     first time and referred to Committee on Health Services;
 1-4     March 17, 1999, reported favorably by the following vote:  Yeas 5,
 1-5     Nays 0; March 17, 1999, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the establishment of pharmacy peer review committees.
 1-9           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-10           SECTION 1.  Subsection (q), Section 17, Texas Pharmacy Act
1-11     (Article 4542a-1, Vernon's Texas Civil Statutes), is amended to
1-12     read as follows:
1-13           (q)  Board investigative files and all information and
1-14     materials compiled by the board in connection with an investigation
1-15     are confidential and are not subject to disclosure under Chapter
1-16     552, Government Code, and are not subject to disclosure, discovery,
1-17     subpoena, or other means of legal compulsion for their release to
1-18     anyone other than the board or its employees or agents involved in
1-19     licensee discipline except that this information may be disclosed
1-20     to:
1-21                 (1)  persons involved with the board in a disciplinary
1-22     action against the licensee;
1-23                 (2)  pharmacist or pharmacy licensing or disciplinary
1-24     authorities of other jurisdictions;
1-25                 (3)  a pharmaceutical or pharmacy peer review committee
1-26     as outlined in Section 27A or 42 of this Act;
1-27                 (4)  law enforcement agencies; and
1-28                 (5)  persons engaged in bona fide research, if all
1-29     individual-identifying information has been deleted.
1-30           SECTION 2.  The Texas Pharmacy Act (Article 4542a-1, Vernon's
1-31     Texas Civil Statutes), is amended by adding Section 42 to read as
1-32     follows:
1-33           Sec. 42.  PEER REVIEW.  (a)  The following words and terms,
1-34     when used in this section, have the following meanings unless the
1-35     context clearly indicates otherwise:
1-36                 (1)  "Pharmacy peer review committee" means:
1-37                       (A)  a pharmacy peer review, judicial, or
1-38     grievance committee of a pharmacy society or association that is
1-39     authorized to evaluate the quality of pharmacy services or the
1-40     competence of pharmacists; or
1-41                       (B)  a pharmacy peer review committee established
1-42     by a person who owns a pharmacy or employs pharmacists that is
1-43     authorized to evaluate the quality of pharmacy services or the
1-44     competence of pharmacists.
1-45                 (2)  "Pharmacy society or association" means a
1-46     membership organization of pharmacists that is incorporated
1-47     pursuant to the Texas Non-Profit Corporation Act (Article 1396-1.01
1-48     et seq., Vernon's Texas Civil Statutes) or that is exempt from the
1-49     payment of federal income taxes pursuant to Section 501(c) of the
1-50     Internal Revenue Code of 1986.
1-51           (b)  A pharmacy peer review committee may be established to
1-52     evaluate the quality of pharmacy services or the competence of
1-53     pharmacists.  The committee may investigate disagreements or
1-54     complaints, determine facts, and make recommendations or issue
1-55     decisions in a written report.  A pharmacy peer review committee
1-56     includes the members, employees, and agents of the committee,
1-57     including assistants, investigators, attorneys, and any other
1-58     agents that serve the committee in any capacity.
1-59           (c)  Except as otherwise provided by this section, all
1-60     proceedings and records of a pharmacy peer review committee are
1-61     confidential, and all communications made to a pharmacy peer review
1-62     committee are privileged.  If a judge makes a preliminary finding
1-63     that such proceedings, records, or communications are relevant to
1-64     an anticompetitive action or an action brought under federal civil
 2-1     rights provisions under 42 U.S.C. Section 1983, then such
 2-2     proceedings, records, or communications are not confidential to the
 2-3     extent they are deemed relevant.
 2-4           (d)  The final report of and any written or oral
 2-5     communications made to a pharmacy peer review committee and the
 2-6     records and proceedings of the committee may be disclosed to
 2-7     another pharmacy peer review committee, appropriate state or
 2-8     federal agencies, national accreditation bodies, or the state board
 2-9     of registration or licensure of this or any other state.
2-10           (e)  Disclosure to the affected pharmacist of confidential
2-11     pharmacy peer review committee information pertinent to the matter
2-12     under review shall not constitute waiver of the confidentiality
2-13     provisions provided by this section.  If a pharmacy peer review
2-14     committee takes action that could result in censure, license
2-15     suspension, restriction, limitation, or revocation by the board or
2-16     denial of membership or privileges in a health care entity, the
2-17     affected pharmacist shall be provided a written copy of the
2-18     recommendation of the pharmacy peer review committee and a copy of
2-19     the pharmacy peer review committee's final decision, including a
2-20     statement of the basis for the decision.
2-21           (f)  Unless disclosure is required or authorized by law,
2-22     records or determinations of or communications to a pharmacy peer
2-23     review committee are not subject to subpoena or discovery and are
2-24     not admissible as evidence in any civil judicial or administrative
2-25     proceeding without waiver of the privilege of confidentiality
2-26     executed in writing by the committee.  The evidentiary privilege
2-27     created by this section may be invoked by any person or
2-28     organization in any civil judicial or administrative proceeding
2-29     unless the person or organization has secured a waiver of the
2-30     privilege executed in writing by the chairman, vice chairman, or
2-31     secretary of the affected pharmacy peer review committee.  If a
2-32     pharmacy peer review committee, a person participating in peer
2-33     review, or any organization named as a defendant in any civil
2-34     action filed as a result of participation in peer review may use
2-35     otherwise confidential information in the committee's, person's, or
2-36     organization's own defense or in a claim or suit under Subsection
2-37     (i) of this section, a plaintiff in such proceeding may disclose
2-38     records or determinations of or communications to a peer review
2-39     committee in rebuttal to information supplied by the defendant.
2-40     Any person seeking access to privileged information must plead and
2-41     prove waiver of the privilege.  A member, employee, or agent of a
2-42     pharmacy peer review committee who provides access to otherwise
2-43     privileged communications or records in cooperation with law
2-44     enforcement authorities in criminal investigations is not
2-45     considered to have waived any privilege established under this
2-46     section.
2-47           (g)  All persons, including governing bodies and medical
2-48     staffs of health care entities, shall comply fully with a subpoena
2-49     for documents or information issued by the board as otherwise
2-50     authorized by law.  The disclosure of documents or information
2-51     under such subpoena does not constitute a waiver of the privilege
2-52     associated with pharmacy peer review committee proceedings.
2-53     Failure to comply with such subpoena constitutes grounds for
2-54     disciplinary action against the facility or individual by the
2-55     appropriate licensing board.
2-56           (h)  A cause of action does not accrue against the members,
2-57     agents, or employees of a pharmacy peer review committee from any
2-58     act, statement, determination, or recommendation made or act
2-59     reported, without malice, in the course of peer review according to
2-60     this section.
2-61           (i)  A pharmacy peer review committee, a person participating
2-62     in peer review, or a health care entity named as a defendant in any
2-63     civil action filed as a result of participation in peer review may
2-64     use otherwise confidential information obtained for legitimate
2-65     internal business and professional purposes, including use in the
2-66     committee's, person's, or entity's own defense.  Such use does not
2-67     constitute a waiver of the confidential and privileged nature of
2-68     pharmacy peer review committee proceedings.
2-69           (j)  Reports, information, or records received and maintained
 3-1     by the board pursuant to this section are considered investigative
 3-2     files and are confidential and may only be released as specified in
 3-3     Section 17(q) of this Act.
 3-4           SECTION 3.  This Act takes effect September 1, 1999.
 3-5           SECTION 4.  The importance of this legislation and the
 3-6     crowded condition of the calendars in both houses create an
 3-7     emergency and an imperative public necessity that the
 3-8     constitutional rule requiring bills to be read on three several
 3-9     days in each house be suspended, and this rule is hereby suspended.
3-10                                  * * * * *