1-1 By: Armbrister S.B. No. 941
1-2 (In the Senate - Filed March 5, 1999; March 8, 1999, read
1-3 first time and referred to Committee on Health Services;
1-4 May 7, 1999, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 3, Nays 0; May 7, 1999,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 941 By: Nelson
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the authority of mental health professionals to form
1-11 certain jointly owned entities.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 4, The Texas Professional Corporation Act
1-14 (Article 1528e, Vernon's Texas Civil Statutes), is amended to read
1-15 as follows:
1-16 Sec. 4. ARTICLES OF INCORPORATION. (a) One or more
1-17 individuals[,] may incorporate a professional corporation by filing
1-18 the original and a copy of Articles of Incorporation with the
1-19 Secretary of State. One or more individuals may incorporate a
1-20 professional legal corporation by filing the original and a copy of
1-21 Articles of Incorporation with the Secretary of State. Except as
1-22 provided by Subsection (b) of this section, no [No] professional
1-23 corporation organized under this Act shall render more than one
1-24 kind of professional service. In addition to other provisions
1-25 required or permitted by law, the Articles of Incorporation shall
1-26 set forth:
1-27 (1) [(a)] A statement that the corporation is a
1-28 professional corporation; and
1-29 (2) [(b)] A statement of the [one specific kind of]
1-30 professional service to be rendered by the corporation.
1-31 (b) Professionals, other than physicians, engaged in related
1-32 mental health fields such as psychology, clinical social work,
1-33 licensed professional counseling, and licensed marriage and family
1-34 therapy may form a professional corporation under this Act to
1-35 perform professional services that fall within the scope of
1-36 practice of those practitioners. When professionals engaged in
1-37 related mental health fields form a corporation under this Act, the
1-38 authority of each of the practitioners is limited by the scope of
1-39 practice of the respective practitioner, and none can exercise
1-40 control over the others' clinical authority granted by their
1-41 respective licenses, whether through agreements, bylaws,
1-42 directives, financial incentives, or other arrangements that would
1-43 assert control over treatment decisions made by a practitioner.
1-44 The state agencies exercising regulatory control over professions
1-45 to which this subsection applies continue to exercise regulatory
1-46 authority over the respective licenses of the professionals.
1-47 SECTION 2. Subsection (B), Section 2, Texas Professional
1-48 Association Act (Article 1528f, Vernon's Texas Civil Statutes), is
1-49 amended to read as follows:
1-50 (B) Licenses. (1) Except as provided by [Subdivision (2)
1-51 of] this subsection, all members of the association shall be
1-52 licensed to perform the type of professional service for which the
1-53 association is formed.
1-54 (2) Doctors of medicine and osteopathy licensed by the
1-55 Texas State Board of Medical Examiners and podiatrists licensed by
1-56 the Texas State Board of Podiatric Medical Examiners may form an
1-57 association that is jointly owned by those practitioners to perform
1-58 a professional service that falls within the scope of practice of
1-59 those practitioners.
1-60 (3) Professionals, other than physicians, engaged in
1-61 related mental health fields such as psychology, clinical social
1-62 work, licensed professional counseling, and licensed marriage and
1-63 family therapy may form an association that is jointly owned by
1-64 those practitioners to perform professional services that fall
2-1 within the scope of practice of those practitioners.
2-2 (4) When doctors of medicine, osteopathy, and podiatry
2-3 or mental health professionals form an association that is jointly
2-4 owned by those practitioners, the authority of each of the
2-5 practitioners is limited by the scope of practice of the respective
2-6 practitioners and none can exercise control over the other's
2-7 clinical authority granted by their respective licenses, either
2-8 through agreements, bylaws, directives, financial incentives, or
2-9 other arrangements that would assert control over treatment
2-10 decisions made by the practitioner. The state agencies exercising
2-11 regulatory control over professions to which this subdivision
2-12 applies [Texas State Board of Medical Examiners and the Texas State
2-13 Board of Podiatric Medical Examiners] continue to exercise
2-14 regulatory authority over their respective licenses.
2-15 SECTION 3. Subsection A, Article 11.01, Texas Limited
2-16 Liability Company Act (Article 1528n, Vernon's Texas Civil
2-17 Statutes), is amended to read as follows:
2-18 A. (1) One or more persons may organize a professional
2-19 limited liability company by filing articles of organization with
2-20 the Secretary of State in accordance with Part Three of this Act.
2-21 In addition to other provisions required or permitted by law, the
2-22 articles of organization of a professional limited liability
2-23 company must include a statement:
2-24 (a) that the limited liability company is a
2-25 professional limited liability company; and
2-26 (b) describing the [one] specific kind of
2-27 professional service to be rendered by the limited liability
2-28 company.
2-29 (2) Except as provided by Subdivision (3) of this
2-30 subsection, a [A] professional limited liability company:
2-31 (a) may be organized under this Act only for the
2-32 purpose of rendering one specific type of professional service and
2-33 ancillary services; and
2-34 (b) [. A professional limited liability company
2-35 organized under this Act] may not render more than one kind of
2-36 professional service.
2-37 (3) Professionals, other than physicians, engaged in
2-38 related mental health fields such as psychology, clinical social
2-39 work, licensed professional counseling, and licensed marriage and
2-40 family therapy may organize a professional limited liability
2-41 company that is jointly owned by those practitioners to perform a
2-42 professional service that falls within the scope of practice of
2-43 those practitioners. When mental health professionals organize a
2-44 professional limited liability company that is jointly owned by
2-45 those practitioners, the authority of each of the practitioners is
2-46 limited by the scope of practice of the respective practitioner,
2-47 and none can exercise control over the others' clinical authority
2-48 granted by their respective licenses, whether through agreements,
2-49 bylaws, directives, financial incentives, or other arrangements
2-50 that would assert control over treatment decisions made by a
2-51 practitioner. The state agencies exercising regulatory control
2-52 over professions to which this subdivision applies continue to
2-53 exercise regulatory authority over their respective licenses.
2-54 SECTION 4. The importance of this legislation and the
2-55 crowded condition of the calendars in both houses create an
2-56 emergency and an imperative public necessity that the
2-57 constitutional rule requiring bills to be read on three several
2-58 days in each house be suspended, and this rule is hereby suspended,
2-59 and that this Act take effect and be in force from and after its
2-60 passage, and it is so enacted.
2-61 * * * * *