Amend CSSB 563 (house committee printing) by adding the 
following appropriately numbered section to read as follows and 
renumbering subsequent sections accordingly:
	SECTION ___.  (a) Section 531.1063, Government Code, is 
amended by amending Subsection (g) and adding Subsections (h) and 
(i) to read as follows:
	 (g)  The commission shall implement [may extend] the program 
statewide as provided by Subsection (h) [to additional counties] if 
the commission determines that statewide implementation
[expansion] would be cost-effective.
	(h)  The commission shall adopt a plan to implement the 
program statewide in phases and shall terminate the statewide 
implementation at any stage of the process if the commission 
determines that statewide implementation would not be 
cost-effective.  The plan must include for each phase:
		(1)  a description of the policies and procedures to be 
tested concerning the handling of lost, forgotten, or stolen cards 
carrying a fingerprint image or situations in which a fingerprint 
match cannot be confirmed;
		(2)  a determination of whether the commission will 
require children or persons who are elderly or disabled to 
participate in the phase and the reason or reasons for including 
children or persons who are elderly or disabled in the phase; and
		(3)  a description of the manner and location in which 
the fingerprint images will be initially collected.
	(i)  In developing the plan required by Subsection (h), the 
commission shall seek comments from recipients, providers, and 
other stakeholders in the state Medicaid program.
	(b)  The Health and Human Services Commission, before 
implementing a phase of the Medicaid fraud reduction pilot program 
required by Section 531.1063, Government Code, as amended by this 
section, that requires mandatory participation by Medicaid 
recipients or health care providers, shall submit a report 
regarding the phase to the governor, lieutenant governor, speaker 
of the house of representatives, and presiding officer of each 
standing committee of the senate and house of representatives 
having jurisdiction over the state Medicaid program.  The report 
must include a description of each component of the plan for that 
phase, as required by Subsection (h), Section 531.1063, Government 
Code, as added by this section.
	(c)  In addition to the report required by Subsection (c), 
Section 2.23, Chapter 198, Acts of the 78th Legislature, Regular 
Session, 2003, the Health and Human Services Commission shall 
report, not later than December 1, 2006, on the status and progress 
of the Medicaid fraud reduction pilot program required by Section 
531.1063, Government Code, as amended by this section, to the 
governor, lieutenant governor, speaker of the house of 
representatives, and presiding officer of each standing committee 
of the senate and house of representatives having jurisdiction over 
the state Medicaid program.  The report must include:
		(1)  a continued evaluation of the benefits of the 
program;                 
		(2)  an evaluation of the strengths and weaknesses of 
the policies and procedures tested in each phase required by 
Subsection (h), Section 531.1063, Government Code, as added by this 
section;
		(3)  information concerning the cost-effectiveness of 
the program;          
		(4)  if the program has been implemented statewide, any 
significant problems encountered; and
		(5)  if the Health and Human Services Commission 
requires participation by children or persons who are elderly or 
disabled, the reason or reasons for including children or persons 
who are elderly or disabled in the program.
	(d)  If before implementing any provision of this section a 
state agency determines that a waiver or authorization from a 
federal agency is necessary for implementation of that provision, 
the agency affected by the provision shall request the waiver or 
authorization and may delay implementing that provision until the 
waiver or authorization is granted.