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A BILL TO BE ENTITLED
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AN ACT
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relating to the reimbursements for certain services provided to |
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Medicaid recipients and reimbursement adjustments relating to |
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those services. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 531.001, Government Code, is amended by |
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adding Subdivisions (4-a) and (4-b) to read as follows: |
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(4-a) "Potentially preventable complication" means a |
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harmful event or negative outcome with respect to a person, |
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including an infection or surgical complication, that: |
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(A) occurs after the person's admission to a |
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hospital or long-term care facility; |
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(B) results from the care, lack of care, or |
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treatment provided during the hospital or long-term care facility |
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stay, as applicable, rather than from a natural progression of an |
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underlying disease; and |
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(C) could reasonably have been prevented if care |
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and treatment had been provided in accordance with accepted |
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standards of care. |
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(4-b) "Potentially preventable readmission" means a |
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return hospitalization of a person within a period specified by the |
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commission that results from deficiencies in the care or treatment |
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provided to the person during a previous hospital stay or from |
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deficiencies in post-hospital discharge follow-up. The term does |
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not include a hospital readmission necessitated by the occurrence |
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of unrelated events after the discharge. The term includes the |
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readmission of a person to a hospital for: |
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(A) the same condition or procedure for which the |
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person was previously admitted; |
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(B) an infection or other complication resulting |
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from care previously provided; |
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(C) a condition or procedure that indicates that |
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a surgical intervention performed during a previous admission was |
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unsuccessful in achieving the anticipated outcome; or |
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(D) another condition or procedure of a similar |
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nature, as determined by the executive commissioner. |
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SECTION 2. Subchapter B, Chapter 531, Government Code, is |
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amended by adding Sections 531.02115 and 531.02117 to read as |
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follows: |
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Sec. 531.02115. REIMBURSEMENT METHODOLOGY FOR MEDICAID |
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INPATIENT HOSPITAL SERVICES. (a) To incentivize controlling costs |
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and improving efficiency, the commission shall, subject to |
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adjustments required by this section: |
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(1) convert the reimbursement methodology used under |
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the Medicaid program to reimburse inpatient hospital services to an |
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all patient refined diagnosis-related groups (DRG) methodology; |
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and |
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(2) establish a statewide standard dollar amount (SDA) |
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rate that is based on the average of all hospital costs associated |
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with providing services under the Medicaid program during the |
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preceding fiscal year. |
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(b) In converting to the reimbursement methodology under |
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Subsection (a)(1), the commission shall, to the extent possible, |
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examine reimbursement methodologies, including nationally |
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implemented reimbursement methodologies, that address historical |
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disparities in the provision of health care services to women, |
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children, and persons with mental illnesses. |
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(c) The commission may adjust rates determined using the |
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factors under Subsection (a) to ensure the equitable reimbursement |
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of hospitals for inpatient services by adjusting the rates as |
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necessary to take into account different markets and provider |
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responsibilities, including by making rate adjustments to account |
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for: |
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(1) whether a hospital is a teaching institution; |
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(2) market wage indexes; and |
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(3) whether the hospital is a state-designated trauma |
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facility or a burn center. |
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(d) The commission shall adjust rates determined using the |
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factors under Subsection (a) to provide incentives for hospitals to |
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provide higher quality of care. To provide the incentives, the |
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commission shall establish a hospital value-based purchasing |
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program that includes quality standards established by the |
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executive commissioner by rule, other than quality standards |
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relating to potentially preventable readmissions and potentially |
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preventable complications. Incentives provided under the program |
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must be based on whether a hospital meets, or improves the |
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hospital's performance with respect to meeting, those quality |
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standards. Under the program, the commission may: |
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(1) reduce a hospital's reimbursement rates by two |
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percent each fiscal year the hospital fails to meet, or to make |
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progress toward meeting, the quality standards; and |
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(2) use 50 percent of the money saved as a result of |
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the reimbursement rate reductions to award hospitals that meet, or |
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make progress toward meeting, the quality standards. |
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(e) Notwithstanding Subsection (d)(1), the commission may |
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reduce reimbursement rates as provided by that subsection only by |
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the following percentages: |
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(1) one percent for the state fiscal year beginning |
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September 1, 2012; |
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(2) 1.25 percent for the state fiscal year beginning |
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September 1, 2013; |
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(3) 1.5 percent for the state fiscal year beginning |
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September 1, 2014; and |
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(4) 1.75 percent for the state fiscal year beginning |
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September 1, 2015. |
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(f) Except as provided by Subsection (g), this section does |
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not apply to a hospital: |
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(1) located in a county with a population of less than |
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50,000 according to the 2000 federal decennial census; |
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(2) owned or operated by this state; |
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(3) whose inpatients are predominately individuals |
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under 18 years of age as described under Section |
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1886(d)(1)(B)(iii), Social Security Act (42 U.S.C. Section |
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1395ww(d)(1)(B)(iii)); |
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(4) classified as a rural referral center under |
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Section 1886(d)(1)(C)(i), Social Security Act (42 U.S.C. Section |
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1395ww(d)(1)(C)(i)); |
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(5) that is a sole community hospital as defined under |
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Section 1886(d)(1)(D)(iii), Social Security Act (42 U.S.C. Section |
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1395ww(d)(1)(D)(iii)), that is not located in a metropolitan |
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statistical area as defined by the United States Office of |
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Management and Budget; or |
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(6) that is a critical access hospital as defined |
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under Section 1861(mm)(1), Social Security Act (42 U.S.C. Section |
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1395x(mm)(1)). |
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(g) The commission shall reimburse hospitals described |
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under Subsection (f) for inpatient care services in a manner that is |
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consistent with provision of payments for inpatient care services |
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under Title XVIII, Social Security Act (42 U.S.C. Section 1395 et |
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seq.). |
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(h) This subsection and Subsection (e) expire September 1, |
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2017. |
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Sec. 531.02117. REIMBURSEMENT ADJUSTMENTS. (a) Subject to |
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Subsection (b), using the data collected under Section 531.02116 |
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and the all patient refined diagnosis-related groups (DRG) |
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methodology implemented under Section 531.02115, the commission |
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shall to the extent feasible adjust Medicaid reimbursements to |
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hospitals, including payments made under the disproportionate |
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share hospitals and upper payment limit supplemental payment |
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programs, in a manner that penalizes a hospital based on the |
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hospital's failure to reduce potentially preventable readmissions |
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and potentially preventable complications. |
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(b) The commission must provide the report required under |
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Section 531.02116(b) to a hospital at least one year before the |
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commission adjusts Medicaid reimbursements to the hospital under |
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this section. |
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(c) This section does not apply to a hospital described |
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under Section 531.02115(f). |
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SECTION 3. Section 531.913, Government Code, is transferred |
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to Subchapter B, Chapter 531, Government Code, redesignated as |
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Section 531.02116, Government Code, and amended to read as follows: |
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Sec. 531.02116 [531.913]. COLLECTION AND REPORTING OF |
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CERTAIN [HOSPITAL HEALTH] INFORMATION [EXCHANGE]. (a) [In this
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section, "potentially preventable readmission" means a return
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hospitalization of a person within a period specified by the
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commission that results from deficiencies in the care or treatment
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provided to the person during a previous hospital stay or from
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deficiencies in post-hospital discharge follow-up.
The term does
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not include a hospital readmission necessitated by the occurrence
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of unrelated events after the discharge.
The term includes the
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readmission of a person to a hospital for:
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[(1)
the same condition or procedure for which the
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person was previously admitted;
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[(2)
an infection or other complication resulting from
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care previously provided;
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[(3)
a condition or procedure that indicates that a
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surgical intervention performed during a previous admission was
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unsuccessful in achieving the anticipated outcome; or
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[(4)
another condition or procedure of a similar
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nature, as determined by the executive commissioner.
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[(b)] The executive commissioner shall adopt rules for |
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identifying potentially preventable readmissions of Medicaid |
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recipients and potentially preventable complications experienced |
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by those recipients. The [and the] commission shall collect |
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[exchange] data from [with] hospitals on present-on-admission |
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indicators for purposes of this section. |
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(b) [(c)] The commission shall establish a [health
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information exchange] program to provide a [exchange] confidential |
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report to [information with] each hospital in this state that |
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participates in the Medicaid program regarding the hospital's |
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performance with respect to potentially preventable readmissions |
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and potentially preventable complications. To the extent possible, |
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a report provided under this section should include potentially |
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preventable readmissions and potentially preventable complications |
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information across all payment systems. A hospital shall |
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distribute the information contained in the report [received from
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the commission] to health care providers providing services at the |
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hospital. |
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(c) A report provided to a hospital under this section is |
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confidential and is not subject to Chapter 552. |
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(d) This section does not apply to a hospital described |
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under Section 531.02115(f). |
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SECTION 4. (a) As soon as possible after the effective date |
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of this Act, but not later than September 1, 2012: |
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(1) the Health and Human Services Commission shall |
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convert the Medicaid hospital services reimbursement methodology |
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to an all patient refined diagnosis-related groups (DRG) |
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methodology as required by Section 531.02115(a), Government Code, |
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as added by this Act, under which hospitals are reimbursed for the |
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provision of services under the Medicaid program at a rate that is |
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based on the statewide standard dollar amount (SDA) rate also |
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required under that section; and |
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(2) the executive commissioner of the Health and Human |
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Services Commission shall adopt the quality standards for use in |
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the hospital value-based purchasing program as required by Section |
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531.02115(d), Government Code, as added by this Act. |
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(b) The Health and Human Services Commission shall provide |
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reimbursements to hospitals for the provision of services under the |
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Medicaid program using the reimbursement rates in effect on August |
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31, 2011, until the commission meets the requirements of Subsection |
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(a)(1) of this section. After the commission implements that |
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methodology and notwithstanding any other law, the commission may |
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not use appropriated money to provide reimbursements under any |
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other methodology. |
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(c) Notwithstanding Sections 531.02115(d) and (e) and |
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531.02117, Government Code, as added by this Act, the Health and |
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Human Services Commission may only implement the hospital |
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value-based purchasing program as required by Section |
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531.02115(d), Government Code, as added by this Act, or otherwise |
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adjust reimbursement rates as provided by this Act after the Health |
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and Human Services Commission converts the Medicaid hospital |
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services reimbursement methodology and establishes the statewide |
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standard dollar amount (SDA) rate under Section 531.02115(a), |
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Government Code, as added by this Act. |
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(d) Not later than September 1, 2012, the Health and Human |
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Services Commission shall begin providing performance reports to |
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hospitals regarding the hospitals' performances with respect to |
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potentially preventable complications as required by Section |
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531.02116, Government Code, as transferred, redesignated, and |
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amended by this Act. |
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SECTION 5. If before implementing any provision of this Act |
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a state agency determines that a waiver or authorization from a |
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federal agency is necessary for implementation of that provision, |
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the agency affected by the provision shall request the waiver or |
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authorization and may delay implementing that provision until the |
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waiver or authorization is granted. |
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SECTION 6. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2011. |