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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of certain nursing facilities, including |
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licensing requirements and Medicaid participation and |
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reimbursement requirements. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 540.0752(b), Government Code, is amended |
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to read as follows: |
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(b) Subject to Section 540.0701 and notwithstanding any |
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other law, the commission shall provide Medicaid benefits through |
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the STAR+PLUS Medicaid managed care program to recipients who |
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reside in nursing facilities. In implementing this subsection, the |
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commission shall ensure that: |
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(1) a nursing facility is paid not later than the 10th |
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day after the date the facility submits a clean claim; |
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(1-a) a nursing facility complies with the patient care |
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expense ratio adopted under Section 32.0286, Human Resources Code; |
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(2) services are used appropriately, consistent with |
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criteria the commission establishes; |
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(3) the incidence of potentially preventable events |
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and unnecessary institutionalizations is reduced; |
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(4) a Medicaid managed care organization providing |
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services under the program: |
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(A) provides discharge planning, transitional |
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care, and other education programs to physicians and hospitals |
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regarding all available long-term care settings; |
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(B) assists in collecting applied income from |
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recipients; and |
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(C) provides payment incentives to nursing |
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facility providers that: |
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(i) reward reductions in preventable acute |
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care costs; and |
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(ii) encourage transformative efforts in |
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the delivery of nursing facility services, including efforts to |
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promote a resident-centered care culture through facility design |
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and services provided; |
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(5) a portal is established that complies with state |
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and federal regulations, including standard coding requirements, |
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through which nursing facility providers participating in the |
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program may submit claims to any participating Medicaid managed |
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care organization; |
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(6) rules and procedures relating to certifying and |
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decertifying nursing facility beds under Medicaid are not affected; |
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and |
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(7) a Medicaid managed care organization providing |
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services under the program, to the greatest extent possible, offers |
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nursing facility providers access to: |
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(A) acute care professionals; and |
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(B) telemedicine, when feasible and in |
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accordance with state law, including rules adopted by the Texas |
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Medical Board[; and |
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[(8) the commission approves the staff rate |
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enhancement methodology for the staff rate enhancement paid to a |
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nursing facility that qualifies for the enhancement under the |
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program]. |
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SECTION 2. Subchapter F, Chapter 540, Government Code, is |
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amended by adding Section 540.0283 to read as follows: |
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Sec. 540.0283. NURSING FACILITY PROVIDER AGREEMENTS: |
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COMPLIANCE WITH PATIENT CARE EXPENSE RATIO. (a) A contract to |
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which this subchapter applies must require that each provider |
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agreement between the contracting Medicaid managed care |
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organization and a nursing facility include a requirement that the |
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facility comply with the patient care expense ratio adopted under |
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Section 32.0286, Human Resources Code. |
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(b) This section does not apply to a state-owned facility. |
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SECTION 3. Section 242.032, Health and Safety Code, is |
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amended by adding Subsection (b-1) to read as follows: |
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(b-1) The application must: |
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(1) include the name of each person with a direct or |
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indirect ownership interest of five percent or more in: |
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(A) the nursing facility, including a subsidiary |
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or parent company of the facility; and |
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(B) the real property on which the nursing |
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facility is located, including any owner, common owner, tenant, or |
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sublessee; and |
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(2) describe the exact ownership interest of each of |
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those persons in relation to the facility or property. |
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SECTION 4. Subchapter B, Chapter 242, Health and Safety |
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Code, is amended by adding Section 242.0333 to read as follows: |
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Sec. 242.0333. NOTIFICATION OF CHANGE TO OWNERSHIP INTEREST |
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APPLICATION INFORMATION. A license holder shall notify the |
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commission, in the form and manner the commission requires, of any |
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change to the ownership interest application information provided |
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under Section 242.032(b-1). |
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SECTION 5. Subchapter B, Chapter 32, Human Resources Code, |
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is amended by adding Section 32.0286 to read as follows: |
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Sec. 32.0286. ANNUAL PATIENT CARE EXPENSE RATIO FOR |
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REIMBURSEMENT OF CERTAIN NURSING FACILITY PROVIDERS. (a) In this |
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section, "patient care expense": |
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(1) includes an expense incurred by a nursing facility |
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for: |
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(A) providing compensation and benefits to: |
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(i) direct care staff of a facility, |
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whether the staff are employees of or contract labor for the |
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facility, including: |
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(a) licensed registered nurses and |
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licensed vocational nurses, including directors of nursing and |
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assistant directors of nursing; |
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(b) medication aides; |
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(c) restorative aides; |
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(d) nurse aides who provide |
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nursing-related care to residents occupying medical assistance |
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beds; |
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(e) licensed social workers; and |
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(f) social services assistants; |
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(ii) additional staff associated with |
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providing care to facility residents with a severe cognitive |
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impairment; |
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(iii) nonprofessional administrative |
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staff, including medical records staff and accounting or |
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bookkeeping staff; |
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(iv) central supply staff and ancillary |
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facility staff; |
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(v) laundry staff; and |
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(vi) food service staff; |
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(B) central supply costs and ancillary costs for |
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facility services and supplies, including: |
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(i) diagnostic laboratory and radiology |
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costs; |
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(ii) durable medical equipment costs, |
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including costs to purchase, rent, or lease the equipment; |
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(iii) costs for oxygen used to provide |
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oxygen treatment; |
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(iv) prescription and nonprescription drug |
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costs; and |
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(v) therapy consultant costs; and |
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(C) costs for dietary and nutrition services, |
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including costs for: |
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(i) food service and related supplies; and |
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(ii) nutritionist services; and |
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(2) does not include an expense for: |
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(A) administrative or operational costs, other |
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than administrative or operational costs described by Subdivision |
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(1); or |
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(B) fixed capital asset costs. |
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(b) The executive commissioner by rule shall establish an |
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annual patient care expense ratio, including a process for |
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determining the ratio, applicable to the reimbursement of nursing |
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facility providers for providing services to recipients under the |
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medical assistance program. In establishing the ratio, the |
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executive commissioner shall require that at least 85 percent of |
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the portion of the medical assistance reimbursement amount paid to |
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a nursing facility that is attributable to patient care expenses is |
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spent on reasonable and necessary patient care expenses. |
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(c) The executive commissioner shall adopt rules necessary |
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to ensure each nursing facility provider that participates in the |
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medical assistance program complies with the patient care expense |
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ratio adopted under this section. |
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(d) Except as provided by Subsection (e) and to the extent |
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permitted by federal law, the commission may recoup all or part of |
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the medical assistance reimbursement amount paid to a nursing |
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facility that is subject to the patient care expense ratio under |
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this section if the facility fails to spend the reimbursement |
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amount in accordance with the patient care expense ratio. |
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(e) The commission may not recoup a medical assistance |
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reimbursement amount under Subsection (d) if, during the period |
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patient care expenses attributable to the reimbursement amount are |
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calculated, the facility: |
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(1) held at least a four-star rating under the Centers |
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for Medicare and Medicaid Services five-star quality rating system |
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for nursing facilities in two or more of the following categories: |
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(A) overall; |
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(B) health inspections; |
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(C) staffing; and |
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(D) long-stay quality measures; |
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(2) both: |
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(A) maintained an average daily occupancy rate of |
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75 percent or less; and |
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(B) spent at least 70 percent of the portion of |
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the reimbursement amount paid to the facility that was attributable |
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to patient care expenses on reasonable and necessary patient care |
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expenses; or |
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(3) incurred expenses related to a disaster for which |
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the governor issued a disaster declaration under Chapter 418, |
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Government Code. |
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(f) The commission shall publish and maintain on the |
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commission's Internet website a list of all nursing facilities from |
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which the commission recouped medical assistance reimbursement |
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amounts under Subsection (d). |
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(g) The commission may not require a nursing facility to |
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comply with the patient care expense ratio as a condition of |
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participation in the medical assistance program. |
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(h) This section does not apply to a state-owned facility. |
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SECTION 6. Sections 32.028(g), (i), and (m), Human |
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Resources Code, are repealed. |
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SECTION 7. (a) The Health and Human Services Commission |
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shall, subject to this section, require compliance with the initial |
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annual patient care expense ratio adopted under Section 32.0286, |
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Human Resources Code, as added by this Act, beginning on September |
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1, 2025. |
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(b) The Health and Human Services Commission shall, in a |
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contract between the commission and a managed care organization |
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under Chapter 540, Government Code, that is entered into or renewed |
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on or after the effective date of this Act, require the managed care |
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organization to comply with Section 540.0283, Government Code, as |
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added by this Act. |
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(c) The Health and Human Services Commission shall seek to |
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amend contracts entered into with managed care organizations under |
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Chapter 533 or 540, Government Code, before the effective date of |
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this Act to require those managed care organizations to comply with |
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Section 540.0283, Government Code, as added by this Act. To the |
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extent of a conflict between that section and a provision of a |
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contract with a managed care organization entered into before the |
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effective date of this Act, the contract provision prevails. |
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SECTION 8. Not later than November 1, 2027, the Health and |
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Human Services Commission shall prepare and submit to the |
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legislature a written report that includes an assessment of the |
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impact of the patient care expense ratio established under Section |
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32.0286, Human Resources Code, as added by this Act, on nursing |
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facility care provided to Medicaid recipients during the preceding |
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state fiscal biennium, including the impact on the cost and quality |
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of care and any other information the commission determines |
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appropriate. |
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SECTION 9. 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 10. This Act takes effect September 1, 2025. |
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