1-1     By:  Zaffirini                                        S.B. No. 1588
 1-2           (In the Senate - Filed March 12, 1999; March 15, 1999, read
 1-3     first time and referred to Committee on Human Services;
 1-4     April 6, 1999, reported adversely, with favorable Committee
 1-5     Substitute by the following vote:  Yeas 5, Nays 0; April 6, 1999,
 1-6     sent to printer.)
 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 1588               By:  Zaffirini
 1-8                            A BILL TO BE ENTITLED
 1-9                                   AN ACT
1-10     relating to fraud control procedures for the Medicaid managed care
1-11     program.
1-12           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13           SECTION 1.  Subchapter A, Chapter 533, Government Code, is
1-14     amended by adding Section 533.012 to read as follows:
1-15           Sec. 533.012.  INFORMATION FOR FRAUD CONTROL.  (a)  Each
1-16     managed care organization contracting with the commission under
1-17     this chapter shall submit to the commission:
1-18                 (1)  a description of any financial or other business
1-19     relationship between the organization and any subcontractor
1-20     providing health care services under the contract;
1-21                 (2)  a copy of any contract between the organization
1-22     and a subcontractor relating to the delivery of or payment for
1-23     health care services; and
1-24                 (3)  a description of the fraud control program used by
1-25     any subcontractor that delivers health care services.
1-26           (b)  The information submitted under this section must be
1-27     submitted in the form required by the commission and be updated as
1-28     required by the commission.
1-29           (c)  The commission's office of investigations and
1-30     enforcement shall review the information submitted under this
1-31     section as appropriate in the investigation of fraud in the
1-32     Medicaid managed care program.  The comptroller may review the
1-33     information in connection with the health care fraud study
1-34     conducted by the comptroller.
1-35           SECTION 2.  Section 533.005, Government Code, is amended to
1-36     read as follows:
1-37           Sec. 533.005.  REQUIRED CONTRACT PROVISIONS.  A contract
1-38     between a managed care organization and the commission for the
1-39     organization to provide health care services to recipients must
1-40     contain:
1-41                 (1)  procedures to ensure accountability to the state
1-42     for the provision of health care services, including procedures for
1-43     financial reporting, quality assurance, utilization review, and
1-44     assurance of contract and subcontract compliance;
1-45                 (2)  capitation and provider payment rates that ensure
1-46     the cost-effective provision of quality health care;
1-47                 (3)  a requirement that the managed care organization
1-48     provide ready access to a person who assists recipients in
1-49     resolving issues relating to enrollment, plan administration,
1-50     education and training, access to services, and grievance
1-51     procedures;
1-52                 (4)  a requirement that the managed care organization
1-53     provide ready access to a person who assists providers in resolving
1-54     issues relating to payment, plan administration, education and
1-55     training, and grievance procedures;
1-56                 (5)  a requirement that the managed care organization
1-57     provide information and referral about the availability of
1-58     educational, social, and other community services that could
1-59     benefit a recipient;
1-60                 (6)  procedures for recipient outreach and education;
1-61                 (7)  a requirement that the managed care organization
1-62     make payment to a physician or provider for health care services
1-63     rendered to a recipient under a managed care plan not later than
1-64     the 45th day after the date a claim for payment is received with
 2-1     documentation reasonably necessary for the managed care
 2-2     organization to process the claim, or within a period, not to
 2-3     exceed 60 days, specified by a written agreement between the
 2-4     physician or provider and the managed care organization;
 2-5                 (8)  a requirement that the commission, on the date of
 2-6     a recipient's enrollment in a managed care plan issued by the
 2-7     managed care organization, inform the organization of the
 2-8     recipient's Medicaid recertification date;  [and]
 2-9                 (9)  a requirement that the managed care organization
2-10     comply with Section 533.006 as a condition of contract retention
2-11     and renewal; and
2-12                 (10)  a requirement that the managed care organization
2-13     provide the information required by Section 533.012 and otherwise
2-14     comply and cooperate with the commission's office of investigations
2-15     and enforcement.
2-16           SECTION 3.  This Act takes effect September 1, 1999.
2-17           SECTION 4.  The change in law made by this Act applies only
2-18     to a contract with a managed care organization entered into or
2-19     renewed on or after the effective date of this Act.  A contract
2-20     entered into before the effective date of this Act is governed by
2-21     the law as it existed immediately before the effective date of this
2-22     Act, and that law is continued in effect for that purpose.
2-23           SECTION 5.  The importance of this legislation and the
2-24     crowded condition of the calendars in both houses create an
2-25     emergency and an imperative public necessity that the
2-26     constitutional rule requiring bills to be read on three several
2-27     days in each house be suspended, and this rule is hereby suspended.
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