By Hawley                                             H.B. No. 3010
         77R9281 T                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the operation of a statewide rural health care system.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1. (a)  GOALS OF SYSTEM.  The statewide rural health
 1-5     care system established under Chapter 20C, Insurance Code, is
 1-6     designed to protect and enhance the rural health care delivery
 1-7     system by (i) establishing a statewide rural health care network;
 1-8     (ii) supporting funding to rural communities; (iii) enabling
 1-9     administrative simplification for the benefit of rural providers
1-10     that participate in various health benefit plans; and (iv) assuring
1-11     the inclusion of [incorporate] consumer-oriented attributes
1-12     considered important to a successful health care organization.
1-13     These attributes include consideration of patient rights,
1-14     preservation of significant traditional provider
1-15     [physician]-patient relationship, emphasis on prevention and
1-16     wellness, an appropriate credentialing and peer review program, and
1-17     emphasis on quality improvement and disease management [including
1-18     obtaining accreditation.]
1-19           SECTION 2. Article 20C.02, Insurance Code, is amended to read
1-20     as follows:
1-21           Art. 20C.02.  DEFINITIONS. Sections (a)(2), (a)(3) and (b)(4)
1-22     shall be amended as follows:
1-23                 (2)  "Enrollee" means an individual residing in a rural
1-24     area as defined in this Section entitled to receive health care
 2-1     services through a health care plan sponsored by, arranged for or
 2-2     provided by the system.
 2-3                 (3)  "Health care services" means those services
 2-4     provided under a plan of insurance, a health maintenance
 2-5     organization, or other entity that provides health benefits
 2-6     coverage [has the meaning assigned by Section 2, Texas Health
 2-7     Maintenance Organization Act (Article 20A.02, Vernon's Texas
 2-8     Insurance Code)].
 2-9           (b)  In designating rural areas under Subsection (a)(8) of
2-10     this article, the commissioner shall consider any area that is
2-11     delineated as an urbanized area by the federal census bureau and:
2-12                 (8)  in which emergency or primary care services are
2-13     limited or unavailable in accordance with network access standards
2-14     imposed by the commissioner [under the Texas Health Maintenance
2-15     Organization Act (Chapter 20A, Vernon's Texas Insurance Code)] and
2-16     in which those services would be made materially more accessible by
2-17     allowing access to care in a contiguous area that is eligible to
2-18     participate in the system.
2-19           SECTION 3. Article 20C.03, Insurance Code, is amended to read
2-20     as follows:
2-21           Art. 20C.03.  ESTABLISHMENT OF SYSTEM. The state wide rural
2-22     health care system is established to sponsor, arrange for or
2-23     provide health care services that:
2-24                 (1)  for programs in rural areas offered under Chapter
2-25     62 of the Health and Safety Code or programs offered pursuant to
2-26     Chapter 1377, Article 7, General and Special Laws of the State of
2-27     Texas, 76th Legislature, are not subject to a law that requires (A)
 3-1     coverage or the offer of coverage of a health care service or
 3-2     benefit; (B) coverage or the offer of coverage for the provision of
 3-3     services by a particular health care services provider, or (C) the
 3-4     use of a particular policy or contract form or of particular
 3-5     language in a policy or contract form, and
 3-6                 (2)  for programs in rural areas offered under Chapter
 3-7     32, Human Resources Code or programs offered under any state,
 3-8     county or local government sponsored indigent care initiative or as
 3-9     part of any federal Medicare + Choice program, are not subject to a
3-10     law the requires coverage or the offer of coverage for the
3-11     provision of services by a particular health care services
3-12     provider.
3-13           SECTION 4. Article 20C.04, Insurance Code, is amended to read
3-14     as follows:
3-15           Art. 20C.04.  DESIGNATION AS SYSTEM; QUALIFICATIONS. (a)  The
3-16     commissioner shall designate as the system one organization created
3-17     under Article 20C.05 of this code.
3-18           (b)  The system is authorized to sponsor, provide or arrange
3-19     for the provision of health care services for enrollees as
3-20     described in Article 20C.03. [Except as provided by Subsection (c)
3-21     of this article, i] If the system seeks to sponsor, arrange[s] or
3-22     provide[s] health care services to enrollees under a private or
3-23     commercial program, the system must meet each requirement imposed
3-24     by current insurance laws unless the commissioner grants by rule an
3-25     exception to such requirements on the basis of distance, network
3-26     adequacy and scope of coverage.  [in exchange for a predetermined
3-27     payment per enrollee on a prepaid basis, the system must obtain a
 4-1     certificate of authority under, and meet each requirement imposed
 4-2     by the Texas Health Maintenance Organization Act (Chapter 20A,
 4-3     Vernon's Texas Insurance Code), as if the organization were a
 4-4     person under the Act.]
 4-5           [(c)  If the system seeks a certificate of authority under
 4-6     the Texas Health Maintenance Organization Act (Chapter 20A,
 4-7     Vernon's Texas Insurance Code), the commissioner by rule may
 4-8     provide exceptions to the application of provisions of the Texas
 4-9     Health Maintenance Organization Act (Chapter 20A, Vernon's Texas
4-10     Insurance Code) relating to mileage, distance, and network adequacy
4-11     and scope.]
4-12           [(d)  If the system seeks a certificate of authority under
4-13     the Texas Health Maintenance Organization Act (Chapter 20A,
4-14     Vernon's Texas Insurance Code), the system shall meet all reserve
4-15     requirements required by the commissioner under the Texas Health
4-16     Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
4-17     Code).  The system may fulfill the requirements of this subsection
4-18     through the purchase of reinsurance from insurance companies
4-19     approved for that purpose by the commissioner.]
4-20           SECTION 5. Article 20C.06, Insurance Code, is amended as
4-21     follows:
4-22           20C.06  BOARD. (a)  The system is governed by a board of
4-23     directors composed of 18 members.  Notwithstanding the Texas
4-24     Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's
4-25     Texas Civil Statutes), the board of directors is selected as
4-26     provided by this chapter.
4-27           (b)  [The participating providers shall appoint as
 5-1     representatives of the participating providers s]  Six directors
 5-2     shall be selected in the manner provided by Article 20C.10 of this
 5-3     code.
 5-4           (c)  [The governor shall appoint s] Six directors shall be
 5-5     selected from persons residing in the territorial jurisdictions of
 5-6     the participating providers, including two each who:
 5-7                 (1)  [two persons who] represent employers;
 5-8                 (2)  [two persons who] are local government officials;
 5-9     and
5-10                 (3)  [two persons who] are consumers of health care
5-11     services.
5-12           (d)  In addition to the directors appointed under Subsection
5-13     (c) of this article, [the governor shall appoint] six directors
5-14     shall be appointed from among licensed physicians who reside and
5-15     practice in the territorial jurisdictions of the participating
5-16     providers.  At least three of the physicians appointed under this
5-17     subsection must perform as their professional practice the general
5-18     practice of medicine.
5-19           (e)  Directors appointed under Subsection (c) or (d) of this
5-20     article shall be appointed in such a manner as to represent the
5-21     territorial jurisdictions of all participating providers.
5-22           ARTICLE 6. Article 20C.08, Insurance Code, shall be amended
5-23     as follows:
5-24           ARTICLE 20C.08.  ADMINISTRATION BY BOARD; COMMITTEES.
5-25           (d)  On a majority vote, the board may:
5-26                 (1)  contract for administrative, management or support
5-27     services; [or]
 6-1                 (2)  hire an executive director, contract with
 6-2     consultants, attorneys and other professionals, and [other staff as
 6-3     necessary to implement the duties of the system]
 6-4                 (3)  retain such other staff as necessary to implement
 6-5     the duties of the system.
 6-6           SECTION 7. Article 20C.14, Insurance Code, is amended to read
 6-7     as follows:
 6-8           Art. 20C.14.  MANDATED PROVIDER. (a)  to the extent
 6-9     consistent with federal law, the state shall award to the system at
6-10     least one of any state managed care contracts awarded to provide
6-11     health care services to beneficiaries of the Texas Medical
6-12     Assistance Program under Chapter 32, Human Resources Code, in the
6-13     rural areas within the territorial jurisdiction of the
6-14     participating providers.  Notwithstanding any other law, the
6-15     commissioner of health and human services may include the system in
6-16     any voluntary pilot or demonstration program which seeks to
6-17     evaluate the use of an insured model for beneficiaries of the Texas
6-18     Medical Assistance Program in a rural area that is not currently
6-19     included in an existing Medicaid managed care pilot program area
6-20     and that incorporates the principles of prevention, disease
6-21     management and studies the use of Promotora's as described in H.B.
6-22     1864, 76th Session."