SRC-JEC H.B. 393 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 393
By: Maxey (Ellis, Rodney)
Health & Human Services
5/9/2001
Engrossed


DIGEST AND PURPOSE 

Many nonprofit hospitals, health maintenance organizations, and health
insurers are converting to forprofit or mutual corporations or transferring
their assets to another nonprofit. Under the current law, a nonprofit
health care organization is obligated to dedicate its assets to an entity
that is dedicated to similar purposes.  The attorney general is responsible
for protecting charitable trusts, gifts, and entities and for ensuring that
nonprofits are used for their dedicated purpose and not for individual
gain. However, nonprofit organizations are not currently required to inform
the attorney general when considering whether to sell or change their
nonprofit status. H.B. 393 establishes provisions to ensure that charitable
health care organizations continue to serve the public's health care needs,
especially the needs of uninsured or underinsured individuals.  

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency.  

SECTION BY SECTION ANALYSIS

SECTION 1.  PURPOSE AND FINDINGS.  Sets forth legislative findings
regarding nonprofit health care providers meeting the health care needs in
this state. 

SECTION 2.  SHORT TITLE.  Authorizes this Act to be cited as the Charitable
Health Care Trust Act. 

SECTION 3.  DEFINITIONS.  Defines "charitable health care organization,"
"for-profit entity," "health benefit plan provider," "health care
provider," "mutual plan provider," and "nonprofit provider."  

SECTION 4.  DUTIES OF NONPROFIT PROVIDER.  Sets forth duties of a nonprofit
provider in complying with this Act.  Sets forth situations in which
certain sections of this Act do or do not apply, and information concerning
the application of certain sections of this Act. 
 
SECTION 5.  CHARITABLE HEALTH CARE ASSETS. Sets forth provisions regarding
the appraisal and use of assets belonging to a nonprofit provider.  

SECTION 6.  NOTICE OF AGREEMENT OR TRANSACTION.  Sets forth provisions
regarding notice of an agreement or transaction by a nonprofit provider.  

SECTION 7. PUBLICATION OF NOTICE. Sets forth provisions regarding the
publication of notice of an agreement or transaction by a nonprofit
provider.   

SECTION 8.  PUBLIC MEETING.  Sets forth provisions regarding a nonprofit
provider holding a public meeting and soliciting public comment.  

SECTION 9.  ENFORCEMENT BY ATTORNEY GENERAL'S OFFICE.  Sets forth
provisions  regarding enforcement of the provisions relating to a nonprofit
provider entering into an agreement or transaction by the office of the
attorney general.   

SECTION 10.  EFFECTIVE DATE.  Effective date: September 1, 2001.

SECTION 11.  TRANSITION.  (a) Provides that this Act applies only to: an
agreement described by Section 4 of this Act that is entered into on or
after September 1, 2001; or a transaction described by Section 4 of this
Act that  is made pursuant to an agreement entered into on or after
September 1, 2001. 

(b)  Provides that an agreement described by Section 4 of this Act that is
entered into before September 1, 2001, and a transaction described by
Section 4 of this Act that is made under an agreement entered into before
September 1, 2001, are governed by the law as it existed immediately before
the effective date of this Act, and that law is continued in effect for
that purpose.