By Naishtat, Wohlgemuth, et al. H.B. No. 1001 77R11310 MCK-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the review of the reimbursement methodology for and 1-3 resource needs of nursing facilities. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. REVIEW OF REIMBURSEMENT RATES. (a) The Health 1-6 and Human Services Commission, in conjunction with the Texas 1-7 Department of Human Services, shall evaluate the methodology used 1-8 for determining Medicaid reimbursement rates for nursing 1-9 facilities. The commission and department shall: 1-10 (1) consider including legitimate costs of doing 1-11 business that are not currently included in the reimbursement rate; 1-12 and 1-13 (2) explore methods to adjust the reimbursement rate 1-14 to account for sudden increases in liability insurance rates and 1-15 other costs of doing business. 1-16 (b) The Health and Human Services Commission, in conjunction 1-17 with the Texas Department of Human Services, shall: 1-18 (1) evaluate the effectiveness of the Medicaid nursing 1-19 facility reimbursement rate methodology to provide incentives for 1-20 increased direct staffing; 1-21 (2) examine the possibility of adding incentives to 1-22 Medicaid reimbursement rates for increased spending to improve the 1-23 diet of residents and other increased spending to improve the 1-24 quality of care and quality of life for residents; 2-1 (3) examine the possibility of developing a system of 2-2 adjusted Medicaid reimbursement for nursing facilities that rewards 2-3 a higher level of performance based on quality indicators; 2-4 (4) examine any inadequacies of the current flat-rate 2-5 system in accounting for regional and facility-specific differences 2-6 in the cost of providing care and explore alternatives to the 2-7 flat-rate system that better account for those differences; and 2-8 (5) examine all the current methodology components, 2-9 including inflation factors and occupancy adjustments. 2-10 (c) In measuring the level of performance under Subsection 2-11 (b)(3) of this section, the criteria that should be examined should 2-12 include: 2-13 (1) a quality of care index that could include the 2-14 factors listed under Section 242.403(a), Health and Safety Code; 2-15 (2) a customer satisfaction index; 2-16 (3) a resolved complaint index; and 2-17 (4) any other criteria the commission considers 2-18 appropriate for examination. 2-19 SECTION 2. REVIEW OF TILE CLASSIFICATION SYSTEM. (a) The 2-20 Health and Human Services Commission, in conjunction with the Texas 2-21 Department of Human Services, shall evaluate the Texas Index for 2-22 Level of Effort classification system used to quantify the 2-23 intensity of the care needs of individuals in nursing facilities 2-24 and to assign daily reimbursement rates for that care to determine 2-25 whether the system accurately accounts for the care needs of 2-26 patients with dementia, including patients with Alzheimer's 2-27 disease. 3-1 (b) In conducting the evaluation of the Texas Index for 3-2 Level of Effort classification system, the Health and Human 3-3 Services Commission shall seek the input of relevant professionals 3-4 and other individuals or organizations with expertise in caring for 3-5 people with dementia, including Alzheimer's disease. 3-6 SECTION 3. REPORT TO LEGISLATURE. The Health and Human 3-7 Services Commission shall report the results of the evaluations 3-8 conducted under this Act to the governor, the lieutenant governor, 3-9 and the speaker of the house of representatives not later than 3-10 December 1, 2002. 3-11 SECTION 4. EFFECTIVE DATE. This Act takes effect September 3-12 1, 2001.