By: Zerwas H.B. No. 2557

A BILL TO BE ENTITLED

AN ACT

relating to the status of a charitable organization formed by a hospital district.

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

SECTION 1. The legislature finds that districts have benefitted from the support provided by charitable organizations created under this section through the development of innovative technologies and intellectual property, novel public health studies, patient care techniques, and other means of financial, administrative or operational support. The legislature intends that charitable organizations created under this section will further develop resources for health care services by collaborating with or entering into joint ventures or other agreements with private entities including for-profit entities. The legislature recognizes that the knowhow, resources, support, technologies and intellectual property created, licensed, or serviced pursuant to these collaborations, joint ventures, or agreements between charitable organizations created under this section and private entities, including for-profit entities, are integral to the sustainability districts and their mission to provide for the health and general welfare of the citizens of this state. The legislature acknowledges that the means and measures authorized by this section are in the public interest and serve a public purpose in promoting the health and general welfare of the people of this state.

SECTION 2. Section 281.0565, Health and Safety Code, is amended to read as follows:

Sec. 281.0565. CHARITABLE ORGANIZATIONS. (a) DEFINITION. In this section, "charitable organization" means an organization that is exempt from federal income tax under Section 501(a) of the Internal Revenue Code of 1986 by being listed as an exempt organization in Section 501(c)(3) or 501(c)(4) of the code.

(b) A district may create a charitable organization to facilitate the management of a district health care program by providing or arranging health care services, developing resources for health care services, or providing ancillary support services for the district. A charitable organization created by a district under this section may contract, collaborate, or enter into a joint venture or other agreement with a public or private entity, without regard to such entity's for-profit, nonprofit, or not-for-profit status, including holding an ownership interest in such entity.

(c) A charitable organization created by a district under this section is a unit of local government for purposes of Chapter 101, Civil Practice and Remedies Code. A charitable organization created by a district under this section is not a political corporation or political subdivision merely because of its characterization hereby as a unit of local government.

(d) A district [ created in a county with a population of more than 800,000 that was not included in the boundaries of a hospital district before September 1, 2003,] may make a capital or other financial contribution to a charitable organization created by the district to provide regional administration and delivery of health care services to or for the district.

(e) A district may, on its own behalf or in partnership or combination with any other district or districts, create a charitable organization to organize, operate, manage, or administer a captive insurance company, captive management company, or an affiliated company under Chapter 964 of the Texas Insurance Code.

SECTION 2. Section 281.0518(a)(3), Health and Safety Code, is amended to read as follows:

(3) contract, collaborate, or enter into a joint venture or other agreement with a public or private entity without regard to such entity's for-profit, nonprofit, or not-for-profit status, including holding an ownership interest in such entity to engage in an activity authorized under Subdivision (1) or (2).

SECTION 3. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2015.