BILL ANALYSIS

C.S.H.B. 840

By: Gonzalez, Naomi

County Affairs

Committee Report (Substituted)

BACKGROUND AND PURPOSE

Texas is one of a few states that continue to maintain a prohibition on the corporate practice of medicine, though the state does allow exceptions to this prohibition. For example, several hospital districts in Texas may directly employ physicians.  The El Paso County Hospital District desires the authority to directly employ, among others, physicians as a tool to recruit primary care and specialty physicians to the El Paso area.  

C.S.H.B. 840 aims to support the district's desire to provide clinical autonomy to certain medical professionals and dentists by authorizing the district to appoint, contract for, or employ physicians, dentists, and other health care providers and reserving to certain medical professionals and dentists the sole control over the practice of medicine.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.H.B. 840 amends the Health and Safety Code to authorize the board of hospital managers of the El Paso County Hospital District to appoint, contract for, or employ physicians, dentists, and other health care providers as the board considers necessary for the efficient operation of the district.  The bill prohibits the term of an employment contract from exceeding four years.  The bill prohibits these provisions regarding the employment of physicians, dentists, and other health professionals from being construed as authorizing the board to supervise or control the practice of medicine as prohibited by the Medical Practice Act or to supervise or control the practice of dentistry as prohibited by the Dental Practice Act.

C.S.H.B. 840 requires the authority granted to the board to employ physicians under the bill's provisions to apply as necessary for the district to fulfill the district's statutory mandate to provide medical care for the indigent and needy residents of the district as provided by provisions of law relating to the district's responsibility for medical aid and hospital care. The bill requires the district's medical executive committee, in accordance with the bylaws adopted by the board, to adopt, maintain, and enforce policies to ensure that a physician employed by the district exercises the physician's independent medical judgment in providing care to patients.  The bill requires the policies adopted by the committee to include policies relating to governance of the committee, credentialing, quality assurance, utilization review, peer review, medical decision-making, and due process, and rules requiring the disclosure of financial conflicts of interest by a member of the committee. The bill requires the committee and the board to jointly develop and implement a conflict management process to resolve any conflict between the policies adopted under the bill's provisions and a policy of the district.  The bill requires a member of the committee who is a physician to provide biennially to the committee chair a signed, verified statement indicating that the committee member is licensed by the Texas Medical Board, will exercise independent medical judgment in all medical executive committee matters, will exercise the committee member's best efforts to ensure compliance with the policies that are adopted or established by the medical executive committee; and will report immediately to the Texas Medical Board any action or event that the committee member reasonably and in good faith believes constitutes a compromise of the independent medical judgment of a physician in caring for a patient.  The bill requires each physician employed by the district to report to the clinical department chair or the designated medical director for the department or unit in which the physician practices for all matters relating to the practice of medicine.

EFFECTIVE DATE

On passage, or, if the bill does not receive the necessary vote, September 1, 2011.

COMPARISON OF ORIGINAL AND SUBSTITUTE

C.S.H.B. 840 differs from the original by authorizing the El Paso County Hospital District to appoint, contract for, or employ physicians, dentists, and other health care providers for the efficient operation of the district, whereas the original authorizes the district to directly employ physicians and dentists for such purpose. The substitute omits a provision included in the original authorizing the board to employ physicians and dentists through a nonprofit health organization certified by the Texas Medical Board and created by the district. The substitute omits a provision included in the original prohibiting the bill's provisions from being construed as authorizing the board of directors of a nonprofit health organization created by the district to supervise or control the practice of medicine or dentistry. 

C.S.H.B. 840 contains a provision not included in the original requiring the authority granted to the board to employ physicians to apply as necessary to fulfill the district's mandate to provide medical care for the indigent and needy residents of the district. 

C.S.H.B. 840 contains provisions not included in the original requiring the medical executive committee of the district to adopt, maintain, and enforce certain policies and requiring the committee and board of the district to jointly develop and implement a conflict management process. 

C.S.H.B. 840 contains a provision not included in the original requiring a committee member who is a physician to provide biennially to the committee chair signed, verified statement indicating that the committee member meets or will meet certain requirements.  The substitute contains a provision not included in the original requiring each physician employed by the district to report to the clinical department chair or the designated medical director for the department or unit in which the physician practices for all matters relating to the practice of medicine.

C.S.H.B. 840 omits provisions included in the original requiring the board to certify a health organization that is created by the El Paso County Hospital District to contract with or employ physicians and meets certain requirements relating to the organization's nonprofit and tax-exempt status and requiring the board to approve and certify a health organization to contract with or employ dentists licensed by the board if the organization presents proof to the board that the organization is created by the El Paso County Hospital District and meets requirements relating to the organization's nonprofit and tax-exempt status.