H.B. No. 2550

AN ACT

relating to the consolidation of the Higher Education Enrollment Assistance Program and the Higher Education Assistance Plan and the transfer of certain enrollment assistance duties to institutions of higher education and to measures to enhance medical education.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subchapter U, Chapter 51, Education Code, is amended by adding Section 51.810 to read as follows:

Sec. 51.810. HIGHER EDUCATION ASSISTANCE PLANS. (a) In this section:

(1) "Coordinating board" means the Texas Higher Education Coordinating Board.

(2) "Institution of higher education" and "private or independent institution of higher education" have the meanings assigned by Section 61.003.

(b) The institution of higher education in closest geographic proximity to a public high school in this state identified by the coordinating board for purposes of this section as substantially below the state average in the number of graduates who enroll in higher education institutions shall enter into an agreement with that high school to develop a plan to increase the number of students from that high school enrolling in higher education institutions. Under the plan, the institution shall:

(1) collaborate with the high school to:

(A) provide to prospective students information related to enrollment in an institution of higher education or a private or independent institution of higher education, including admissions, testing, and financial aid information;

(B) assist those prospective students in completing applications and testing related to enrollment in those institutions, including admissions and financial aid applications, and fulfilling testing requirements; and

(C) target efforts to increase the number of Hispanic students and African American male students enrolled in higher education institutions; and

(2) actively engage with local school districts to provide access to rigorous, high-quality dual credit opportunities for qualified high school students as needed.

(c) An institution of higher education must include a plan developed by the institution under this section and the results of that plan in its annual report to the coordinating board under Section 51.4032.

(d) The coordinating board shall include in its annual "Closing the Gaps" higher education plan progress report a summary of the results of the plans developed and administered under this section.

(e) The coordinating board may adopt rules to implement this section.

SECTION 2. Subtitle A, Title 3, Education Code, is amended by adding Chapter 58A to read as follows:

CHAPTER 58A. PROGRAMS SUPPORTING GRADUATE MEDICAL EDUCATION

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 58A.001. DEFINITION. In this chapter, "board" means the Texas Higher Education Coordinating Board.

SUBCHAPTER B. GRADUATE MEDICAL EDUCATION

RESIDENCY EXPANSION

Sec. 58A.021. ADMINISTRATION. The board shall allocate funds appropriated for purposes of this subchapter and may adopt necessary rules regarding the allocation of those funds.

Sec. 58A.022. PLANNING GRANTS. (a) The board shall award one-time planning grants to entities located in this state that:

(1) have never had a graduate medical education program; and

(2) are eligible for Medicare funding of graduate medical education.

(b) The board shall award planning grants on a competitive basis according to criteria adopted by the board. The board shall determine the number of grants awarded and the amount of each grant consistent with any conditions provided by legislative appropriation. A grant received under this section must be used for the purpose of planning additional first-year residency positions.

(c) An application for a planning grant for a state fiscal year must be submitted to the board not later than July 15 preceding that fiscal year. Not later than August 15, the board shall make decisions about grant awards for the following state fiscal year.

(d) An entity that is awarded a planning grant and establishes new first-year residency positions after receipt of the grant is eligible for additional funds for each such position established, as provided by appropriation.

Sec. 58A.023. GRANTS FOR UNFILLED RESIDENCY POSITIONS. (a) The board shall award grants to graduate medical education programs to enable those programs to fill accredited but unfilled first-year residency positions. The board shall determine the number of grants awarded and the amount of each grant consistent with any conditions provided by legislative appropriation.

(b) A grant received under this section must be expended to support the direct resident costs to the program, including the resident stipend and benefits.

(c) A grant application must include proof of the accredited but unfilled positions to which the application applies. An application for a grant must be submitted to the board not later than October 1 preceding the period for which the grant is made. The board shall make decisions about grant awards not later than January 1 preceding the grant period.

(d) The board may distribute a grant amount for a residency position only on receiving verification that the applicable residency position has been filled.

(e) Grant amounts are awarded under this section for two consecutive state fiscal years. For each first-year residency position for which a program receives an initial grant amount in a fiscal year, the board shall award the program an equal grant amount for the following fiscal year.

Sec. 58A.024. GRANTS FOR PROGRAM EXPANSION OR NEW PROGRAM. (a) The board shall award grants to enable existing graduate medical education programs to increase the number of first-year residency positions or to provide for the establishment of new graduate medical education programs with first-year residency positions. The board shall determine the number of grants awarded and the amount of each grant consistent with any conditions provided by legislative appropriation.

(b) A grant received under this section must be expended to support the direct resident costs to the program, including the resident stipend and benefits.

(c) A grant application must include a plan for receiving accreditation for the increased number of positions or for the new program, as applicable. An application for a grant must be submitted to the board not later than October 1 preceding the period for which the grant is made. The board shall make decisions about grant awards not later than January 1 preceding the grant period.

(d) The board may distribute a grant amount for a residency position only on receiving verification that the applicable residency position has been filled.

(e) Grant amounts are awarded under this section for three consecutive state fiscal years. For each first-year residency position for which a program receives an initial grant amount in a fiscal year, the board shall award the program an equal grant amount for the following two fiscal years.

Sec. 58A.025. PRIORITY GRANTS; ADJUSTMENT OF AMOUNTS. (a) If the board determines that the number of first-year residency positions proposed by eligible applicants under Sections 58A.023 and 58A.024 exceeds the number authorized by appropriation, in awarding grants the board:

(1) may give priority for up to 50 percent of the funded first-year residency positions to be in primary care or other critical shortage areas in this state; and

(2) may not reduce grant amounts awarded per resident position, but may proportionately reduce the number of positions funded for each program.

(b) If the board determines that, based on applications received, the entire appropriation will not be awarded for that year for graduate medical education residency expansion under Sections 58A.023 and 58A.024, the board may transfer and use the funds for the purposes of Section 58A.022 and may adjust the number of grants awarded under that section accordingly.

Sec. 58A.026. GRANTS FOR ADDITIONAL YEARS OF RESIDENCY. (a) If the board determines that funds appropriated for purposes of this subchapter are available after all eligible grant applications under Sections 58A.022, 58A.023, and 58A.024 have been funded, the board shall award grants from excess funds to support residents:

(1) who have completed at least three years of residency; and

(2) whose residency program is in a field in which this state has less than 80 percent of the national average of physicians per 100,000 population, as determined by the board.

(b) Grants shall be awarded under this section in amounts, in the number, and in the residency fields determined by the board, subject to any conditions provided by legislative appropriation. A grant received under this section must be expended to support the direct resident costs to the program, including the resident stipend and benefits.

(c) The board may distribute grant amounts only on receiving verification that the applicable residency position has been filled.

(d) The board may award grants under this section only from funds appropriated for the state fiscal year beginning September 1, 2016, or for a subsequent state fiscal year.

SUBCHAPTER C. PRIMARY CARE INNOVATION PROGRAM

Sec. 58A.051. PRIMARY CARE INNOVATION PROGRAM. Subject to available funds, the board shall establish a grant program under which the board awards incentive payments to medical schools that administer innovative programs designed to increase the number of primary care physicians in this state.

Sec. 58A.052. GIFTS, GRANTS, AND DONATIONS. In addition to other money appropriated by the legislature, the board may solicit, accept, and spend gifts, grants, and donations from any public or private source for the purposes of the program established under this subchapter.

Sec. 58A.053. RULES. In consultation with each medical school in this state, the board shall adopt rules for the administration of the program established under this subchapter. The rules must include:

(1) administrative provisions relating to the awarding of grants under this subchapter, such as:

(A) eligibility criteria for medical schools;

(B) grant application procedures;

(C) guidelines relating to grant amounts;

(D) procedures for evaluating grant applications; and

(E) procedures for monitoring the use of grants; and

(2) methods for tracking the effectiveness of grants that:

(A) using data reasonably available to the board, consider relevant information regarding the career paths of medical school graduates during the four-year period following their graduation; and

(B) evaluate whether and for how long those graduates work in primary care in this state.

Sec. 58A.054. ADMINISTRATIVE COSTS. A reasonable amount, not to exceed three percent, of any money appropriated for purposes of this subchapter may be used by the board to pay the costs of administering this subchapter.

SECTION 3. Subchapter I, Chapter 61, Education Code, is amended by adding Section 61.511 to read as follows:

Sec. 61.511. RESIDENT PHYSICIAN EXPANSION GRANT PROGRAM. (a) The board shall administer the Resident Physician Expansion Grant Program as a competitive grant program to encourage the creation of new graduate medical education positions through community collaboration and innovative funding. The board shall award grants to physician residency programs at teaching hospitals and other appropriate health care entities according to the program criteria established under Subsections (b) and (i).

(b) The board shall establish criteria for the grant program in consultation with the executive commissioner of the Health and Human Services Commission, with one or more physicians, teaching hospitals, medical schools, independent physician residency programs, and with other persons considered appropriate by the board. The program criteria must:

(1) take into account the following factors:

(A) the characteristics of existing residency positions that receive state funding;

(B) current and projected physician workforce demographics; and

(C) state population trends and projections; and

(2) support the following goals:

(A) creating new residency positions, with an emphasis on creating new first-year residency positions, without adversely affecting existing residency positions;

(B) maximizing local or federal matching funds;

(C) developing accredited physician residency programs at hospitals that have not previously offered residency programs; and

(D) increasing residency positions with respect to:

(i) medical specialties having shortages in this state; and

(ii) medically underserved areas in this state.

(c) The board may provide grants only to support a residency position that:

(1) is created and accredited on or after January 1, 2014; or

(2) was created and accredited before January 1, 2013, but as of that date had not yet been filled.

(d) A grant award may be used only to pay direct costs associated with the position, including the salary of the resident physician.

(e) Each grant application must specify:

(1) the number of residency positions expected to be created with the grant money; and

(2) the grant amount requested for each year.

(f) The board shall award grants for all residency positions awarded a grant under this section in the preceding year before awarding a grant for a residency position that did not receive a grant in the preceding year, provided that the applicable grant recipient from the preceding year complies with all conditions of the grant as described by Subsection (g).

(g) The board shall monitor physician residency programs receiving grants as necessary to ensure compliance with the grant program and shall require the return of any unused grant money by, or shall decline to award additional grants to, a residency program that receives a grant but fails to:

(1) create and fill, within a reasonable period, the number of residency positions proposed in the program's grant application; or

(2) satisfy any other conditions of the grant imposed by the board.

(h) The board shall use money forfeited under Subsection (g) to award grants to other eligible applicants. With respect to the physician residency program forfeiting the grant, the board may restore grant money or award additional grants, as applicable, to the program as soon as practicable after the program satisfies all conditions of the grant.

(i) The board shall adopt rules for the administration of the grant program. The rules must include:

(1) administrative provisions governing:

(A) eligibility criteria for grant applicants;

(B) grant application procedures;

(C) guidelines relating to grant amounts;

(D) guidelines relating to the number of grants to be awarded each year, subject to available funds;

(E) procedures for evaluating grant applications; and

(F) procedures for monitoring the use of grants;

(2) methods for tracking the effectiveness of grants; and

(3) any conditions relating to the receipt and use of a grant as considered appropriate by the board.

(j) Not later than January 1 of each year, the board shall prepare and submit to the governor, the lieutenant governor, the speaker of the house of representatives, the standing committees of the senate and house of representatives with responsibility for oversight of health and human services issues, and the Legislative Budget Board a report that:

(1) specifies each of the following with respect to the preceding program year:

(A) the number of grants awarded under the program;

(B) the amount of each grant awarded under the program;

(C) the number of residency positions created with the support of grant money;

(D) the medical specialty of the residency positions created; and

(E) whether physicians who complete their training through residency positions created under the program choose to practice in this state and which medical specialties they choose for their practices; and

(2) makes appropriate recommendations for legislative changes as necessary.

SECTION 4. Section 61.532, Education Code, is amended to read as follows:

Sec. 61.532. ELIGIBILITY. (a) To be eligible to receive repayment assistance, a physician must:

(1) apply to the coordinating board;

(2) at the time of application, be licensed to practice medicine under Subtitle B, Title 3, Occupations Code;

(3) have completed one, two, three, or four consecutive years of practice:

(A) in a health professional shortage area designated by the Department of State Health Services; or

(B) in accordance with Subsection (b), after funds have been fully allocated for the program year to physicians qualifying under Paragraph (A); and

(4) provide health care services to:

(A) recipients under the medical assistance program authorized by Chapter 32, Human Resources Code;

(B) enrollees under the child health plan program authorized by Chapter 62, Health and Safety Code; or

(C) persons committed to a secure correctional facility operated by or under contract with the Texas Juvenile Justice Department [Youth Commission] or persons confined in a secure correctional facility operated by or under contract with any division of the Texas Department of Criminal Justice.

(b) A physician may complete one or more years of practice required by Subsection (a)(3) in a location other than a health professional shortage area designated by the Department of State Health Services if, during the applicable year or years, the physician provides health care services to a designated number of patients who are recipients under the medical assistance program authorized by Chapter 32, Human Resources Code, or the Texas Women's Health Program according to criteria established by the board in consultation with the Health and Human Services Commission. The Health and Human Services Commission shall verify a physician's compliance with this subsection, and the board and the commission shall enter into a memorandum of understanding for that purpose.

(c) The board annually shall solicit and collect information regarding the specific number of patients described by Subsection (a)(4)(A) who are treated by each physician receiving loan repayment assistance under this subchapter.

SECTION 5. Section 61.5391, Education Code, is amended by amending Subsection (a) and adding Subsection (c) to read as follows:

(a) The physician education loan repayment program account is an account in the general revenue fund. The account is composed of:

(1) gifts and grants contributed to the account;

(2) earnings on the principal of the account; and

(3) other amounts deposited to the credit of the account, including:

(A) money deposited under Section 61.539(b) or 61.5392;

(B) legislative appropriations; and

(C) money deposited under Section 155.2415, Tax Code.

(c) Money deposited to the credit of the account under Section 61.5392 may be used only to provide loan repayment assistance to physicians who establish eligibility for the assistance under Section 61.532(a)(4)(A) or (b).

SECTION 6. Subchapter J, Chapter 61, Education Code, is amended by adding Section 61.5392 to read as follows:

Sec. 61.5392. FEDERAL MATCHING FUNDS. (a) For the purposes of this subchapter, the Health and Human Services Commission shall seek any federal matching funds that are available for the purposes of this section.

(b) Any amount received under Subsection (a) shall be transferred to the comptroller to be deposited in the physician education loan repayment program account established under Section 61.5391. Section 403.095, Government Code, does not apply to any amount deposited under this section.

SECTION 7. Sections 61.07622 and 61.088, Education Code, are repealed.

SECTION 8.

(a) As soon as practicable after the effective date of this Act, the Texas Higher Education Coordinating Board shall adopt rules for the implementation and administration of the programs established under Chapter 58A, Education Code, as added by this Act. The coordinating board may adopt the initial rules in the manner provided by law for emergency rules.

(b) Not later than October 1, 2013, the Texas Higher Education Coordinating Board and the Health and Human Services Commission shall enter into the memorandum of understanding required by Section 61.532(b), Education Code, as added by this Act. As soon as practicable after the date of the memorandum, the coordinating board shall begin awarding loan repayment assistance to physicians who establish eligibility under that subsection.

SECTION 9. This Act takes effect September 1, 2013.

______________________________ ______________________________

President of the Senate Speaker of the House

I certify that H.B. No. 2550 was passed by the House on May 2, 2013, by the following vote: Yeas 142, Nays 5, 2 present, not voting; and that the House concurred in Senate amendments to H.B. No. 2550 on May 24, 2013, by the following vote: Yeas 124, Nays 17, 2 present, not voting.

______________________________ Chief Clerk of the House

I certify that H.B. No. 2550 was passed by the Senate, with amendments, on May 22, 2013, by the following vote: Yeas 31, Nays 0.

______________________________ Secretary of the Senate APPROVED: __________________

Date

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Governor