Bill Text: TX SB8 | 2011-2012 | 82nd Legislature | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to improving the quality and efficiency of health care.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Engrossed - Dead) 2011-05-30 - Point of order sustained [SB8 Detail]

Download: Texas-2011-SB8-Introduced.html

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82R1729 JSC-D
By: Nelson S.B. No. 8

A BILL TO BE ENTITLED
AN ACT
relating to improving the quality and efficiency of health care.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. LEGISLATIVE FINDINGS AND INTENT; COMPLIANCE WITH
ANTITRUST LAWS
SECTION 1.01. (a) The legislature finds that it would
benefit the State of Texas to:
(1) explore innovative health care delivery and
payment models to improve quality and efficiency of health care in
this state;
(2) improve health care transparency;
(3) give health care providers the flexibility to
collaborate and innovate to improve the quality and efficiency of
health care; and
(4) create incentives to improve quality and
efficiency of health care.
(b) The legislature intends to exempt from antitrust laws
and provide immunity from federal antitrust laws through the state
action doctrine a health care collaborative certified under Chapter
848, Insurance Code, as added by Article 3 of this Act, and that
collaborative's negotiations of contracts with payors. The
legislature does not intend or authorize any person or entity to
engage in activities or to conspire to engage in activities that
would constitute per se violations of federal antitrust laws.
ARTICLE 2. TEXAS INSTITUTE OF HEALTH CARE QUALITY AND EFFICIENCY
SECTION 2.01. Title 12, Health and Safety Code, is amended
by adding Chapter 1002 to read as follows:
CHAPTER 1002. TEXAS INSTITUTE OF HEALTH CARE QUALITY AND
EFFICIENCY
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1002.001. DEFINITIONS. In this chapter:
(1) "Board" means the board of directors of the Texas
Institute of Health Care Quality and Efficiency established under
this chapter.
(2) "Commission" means the Health and Human Services
Commission.
(3) "Department" means the Department of State Health
Services.
(4) "Executive commissioner" means the executive
commissioner of the Health and Human Services Commission.
(5) "Health care collaborative" has the meaning
assigned by Section 848.001, Insurance Code.
(6) "Institute" means the Texas Institute of Health
Care Quality and Efficiency established under this chapter.
(7) "Potentially preventable admission" means an
admission of a person to a hospital or long-term care facility that
could reasonably have been prevented if care and treatment had been
provided by a health care provider in accordance with accepted
standards of care.
(8) "Potentially preventable ancillary service" means
a health care service provided or ordered by a health care provider
to supplement or support the evaluation or treatment of a patient,
including a diagnostic test, laboratory test, therapy service, or
radiology service, that is not reasonably necessary for the
provision of quality health care or treatment.
(9) "Potentially preventable complication" means a
harmful event or negative outcome with respect to a person,
including an infection or surgical complication, that:
(A) occurs after the person's admission to a
hospital or long-term care facility;
(B) results from the care or treatment provided
or the lack of care during the hospital or long-term care facility
stay rather than from a natural progression of an underlying
disease; and
(C) could reasonably have been prevented if care
and treatment had been provided in accordance with accepted
standards of care.
(10) "Potentially preventable event" means a
potentially preventable admission, a potentially preventable
ancillary service, a potentially preventable complication, a
potentially preventable hospital emergency room visit, a
potentially preventable readmission, or a combination of those
events.
(11) "Potentially preventable hospital emergency room
visit" means treatment of a person in a hospital emergency room for
a condition that does not require emergency medical attention
because the condition could be treated by a health care provider in
a nonemergency setting.
(12) "Potentially preventable readmission" means a
return hospitalization of a person within a period specified by the
commission that results from deficiencies in the care or treatment
provided to the person during a previous hospital stay or from
deficiencies in post-hospital discharge follow-up. The term does
not include a hospital readmission necessitated by the occurrence
of unrelated events after the discharge. The term includes the
readmission of a person to a hospital for:
(A) the same condition or procedure for which the
person was previously admitted;
(B) an infection or other complication resulting
from care previously provided;
(C) a condition or procedure that indicates that
a surgical intervention performed during a previous admission was
unsuccessful in achieving the anticipated outcome; or
(D) another condition or procedure of a similar
nature, as determined by the executive commissioner.
Sec. 1002.002. ESTABLISHMENT; PURPOSE. The Texas Institute
of Health Care Quality and Efficiency is established to improve
health care quality, accountability, and cost containment in this
state by encouraging health care provider collaboration, effective
health care delivery models, and coordination of health care
services.
[Sections 1002.003-1002.050 reserved for expansion]
SUBCHAPTER B. ADMINISTRATION
Sec. 1002.051. APPLICATION OF SUNSET ACT. The institute is
subject to Chapter 325, Government Code. Unless continued in
existence as provided by that chapter, the institute is abolished
and this chapter expires September 1, 2017.
Sec. 1002.052. COMPOSITION OF BOARD OF DIRECTORS. (a) The
institute is governed by a board of 15 directors appointed as
follows:
(1) five members appointed by the governor;
(2) five members appointed by the governor from a list
of candidates prepared by the speaker of the house of
representatives; and
(3) five members appointed by the lieutenant governor.
(b) The following ex officio, nonvoting members also serve
on the board:
(1) the commissioner of the department;
(2) the executive commissioner;
(3) the commissioner of insurance;
(4) the executive director of the Employees Retirement
System of Texas;
(5) the executive director of the Teacher Retirement
System of Texas;
(6) the state Medicaid director of the Health and
Human Services Commission; and
(7) a representative from each state agency or system
of higher education that purchases or provides health care
services, as determined by the governor.
(c) The governor and lieutenant governor shall appoint as
board members health care providers, payors, consumers, and health
care quality experts or persons who possess expertise in any other
area the governor or lieutenant governor finds necessary for the
successful operation of the institute.
Sec. 1002.053. TERMS OF OFFICE. (a) Appointed members of
the board serve two-year terms ending January 31 of each
odd-numbered year.
(b) Board members may serve consecutive terms.
Sec. 1002.054. ADMINISTRATIVE SUPPORT. (a) The institute
is administratively attached to the commission.
(b) The commission shall coordinate administrative
responsibilities with the institute to streamline and integrate the
institute's administrative operations and avoid unnecessary
duplication of effort and costs.
Sec. 1002.055. EXPENSES. Members of the board serve
without compensation but, subject to the availability of
appropriated funds, may receive reimbursement for actual and
necessary expenses incurred in attending meetings of the board.
Sec. 1002.056. OFFICER; CONFLICT OF INTEREST. (a) The
governor shall designate a member of the board as presiding officer
to serve in that capacity at the pleasure of the governor.
(b) Any board member or a member of a committee formed by the
board with direct interest, personally or through an employer, in a
matter before the board shall abstain from deliberations and
actions on the matter in which the conflict of interest arises and
shall further abstain on any vote on the matter, and may not
otherwise participate in a decision on the matter.
(c) Each board member shall file a conflict of interest
statement and a statement of ownership interests with the board to
ensure disclosure of all existing and potential personal interests
related to board business.
Sec. 1002.057. PROHIBITION ON CERTAIN CONTRACTS AND
EMPLOYMENT. The board may not compensate, employ, or contract with
any individual who serves as a member of the board of any other
governmental body, including any agency, council, or committee, in
this state.
Sec. 1002.058. MEETINGS. (a) The board may meet as often
as necessary, but shall meet at least once each calendar quarter.
(b) The board shall develop and implement policies that
provide the public with a reasonable opportunity to appear before
the board and to speak on any issue under the authority of the
institute.
Sec. 1002.059. BOARD MEMBER IMMUNITY. (a) A board member
may not be held civilly liable for an act performed, or omission
made, in good faith in the performance of the member's powers and
duties under this chapter.
(b) A cause of action does not arise against a member of the
board for an act or omission described by Subsection (a).
Sec. 1002.060. PRIVACY OF INFORMATION. (a) Protected
health information and individually identifiable health
information collected, assembled, or maintained by the institute is
confidential and is not subject to disclosure under Chapter 552,
Government Code.
(b) The institute shall comply with all state and federal
laws and rules relating to the protection, confidentiality, and
transmission of health information, including the Health Insurance
Portability and Accountability Act of 1996 (Pub. L. No. 104-191)
and rules adopted under that Act, 42 U.S.C. Section 290dd-2, and 42
C.F.R. Part 2.
(c) The commission, department, or institute or an officer
or employee of the commission, department, or institute, including
a board member, may not disclose any information that is
confidential under this section.
(d) Information, documents, and records that are
confidential as provided by this section are not subject to
subpoena or discovery and may not be introduced into evidence in any
civil or criminal proceeding.
(e) An officer or employee of the commission, department, or
institute, including a board member, may not be examined in a civil,
criminal, special, or other proceeding as to information that is
confidential under this section.
Sec. 1002.061. FUNDING. (a) The institute may be funded
through the General Appropriations Act and may request, accept, and
use gifts and grants as necessary to implement its functions.
(b) The institute may participate in other
revenue-generating activity that is consistent with the
institute's purposes.
(c) Each state agency represented on the board as a
nonvoting member shall provide funds to support the institute and
implement this chapter. The commission shall establish a funding
formula to determine the level of support each state agency is
required to provide.
[Sections 1002.062-1002.100 reserved for expansion]
SUBCHAPTER C. POWERS AND DUTIES
Sec. 1002.101. GENERAL POWERS AND DUTIES. The institute
shall:
(1) improve quality and efficiency of health care
delivery by:
(A) providing a forum for payors and providers to
discuss and implement initiatives that promote the use of best
practices, increase health care provider collaboration, improve
health care outcomes, and contain health care costs;
(B) researching, developing, supporting, and
promoting strategies to improve the quality and efficiency of
health care in this state;
(C) determining the outcome measures that are the
most effective measures of quality and efficiency, such as the
incidence of potentially preventable events; and
(D) creating a state plan for improving the
quality and efficiency of health care services;
(2) improve reporting, consolidation, and
transparency of health care information; and
(3) make recommendations for and provide support for
innovative health care collaborative payment and delivery systems
under Chapter 848, Insurance Code.
Sec. 1002.102. GOALS FOR QUALITY AND EFFICIENCY OF HEALTH
CARE; STATEWIDE PLAN. (a) The institute shall study and develop
recommendations to improve the quality and efficiency of health
care delivery in this state, including:
(1) quality-based payment systems that align payment
incentives with high-quality, cost-effective health care;
(2) alternative health care delivery systems that
promote health care coordination and provider collaboration; and
(3) quality of care and efficiency outcome
measurements that are effective measures of prevention, wellness,
coordination, provider collaboration, and cost-effective health
care.
(b) The institute shall study and develop recommendations
for measuring quality of care and efficiency across:
(1) all state employee and state retiree benefit
plans;
(2) employee and retiree benefit plans provided
through the Teacher Retirement System of Texas;
(3) the state medical assistance program under Chapter
32, Human Resources Code; and
(4) the child health plan under Chapter 62, Health and
Safety Code.
(c) Using the studies described by Subsections (a) and (b),
the institute shall develop a statewide plan for quality and
efficiency of the delivery of health care.
[Sections 1002.103-1002.150 reserved for expansion]
SUBCHAPTER D. HEALTH CARE COLLABORATIVE GUIDELINES AND SUPPORT
Sec. 1002.151. INSTITUTE STUDIES AND RECOMMENDATIONS
REGARDING PAYMENT AND DELIVERY SYSTEMS. (a) The institute shall
study alternative payment and delivery systems and determine which
models are appropriate for certification as a health care
collaborative under Chapter 848, Insurance Code.
(b) The institute shall make recommendations for the
eligibility requirements for initial and continuing certification
as a health care collaborative, such as recommendations concerning
how a collaborative will:
(1) improve health care provider collaboration and
coordination of services;
(2) improve quality of care; and
(3) contain health care costs.
(c) The institute shall recommend methods to evaluate a
health care collaborative's effectiveness, including methods to
evaluate:
(1) the efficiency and effectiveness of
cost-containment methods used by the collaborative;
(2) the quality of care;
(3) health care provider collaboration and
coordination;
(4) the protection of patients; and
(5) patient satisfaction.
[Sections 1002.152-1002.200 reserved for expansion]
SUBCHAPTER E. IMPROVED TRANSPARENCY
Sec. 1002.201. HEALTH CARE ACCOUNTABILITY; IMPROVED
TRANSPARENCY. (a) With the assistance of the department, the
institute shall complete an assessment of all health-related data
collected by the state and how the public and health care providers
benefit from this information, including health care cost and
quality information.
(b) The institute shall develop a plan:
(1) for consolidating reports of health-related data
from various sources to reduce administrative costs to the state
and reduce the administrative burden to health care providers;
(2) for improving health care transparency to the
public and health care providers by making information available in
the most effective format; and
(3) for enhancing existing health-related information
available to health care providers and the public, including
provider reporting of additional information not currently
required to be reported under existing law, to improve quality of
care.
Sec. 1002.202. ALL PAYOR CLAIMS DATABASE. (a) The
institute shall study the feasibility and desirability of
establishing a centralized database for health care claims
information across all payors.
(b) The institute shall consult with the department and the
Texas Department of Insurance to develop a plan to establish the
centralized claims database described by Subsection (a).
SECTION 2.02. Chapter 109, Health and Safety Code, is
repealed.
SECTION 2.03. On the effective date of this Act:
(1) the Texas Health Care Policy Council established
under Chapter 109, Health and Safety Code, is abolished; and
(2) any unexpended and unobligated balance of money
appropriated by the legislature to the Texas Health Care Policy
Council established under Chapter 109, Health and Safety Code, as
it existed immediately before the effective date of this Act, is
transferred to the Texas Institute of Health Care Quality and
Efficiency created by Chapter 1002, Health and Safety Code, as
added by this Act.
SECTION 2.04. The governor and lieutenant governor shall
appoint voting members of the board of directors of the Texas
Institute of Health Care Quality and Efficiency under Section
1002.052, Health and Safety Code, as added by this Act, as soon as
practicable after the effective date of this Act.
SECTION 2.05. (a) Not later than December 1, 2012, the
Texas Institute of Health Care Quality and Efficiency shall submit
a report regarding improved health care reporting to the governor,
the lieutenant governor, the speaker of the house of
representatives, and the chairs of the appropriate standing
committees of the legislature outlining:
(1) the initial assessment conducted under Section
1002.201(a), Health and Safety Code, as added by this Act;
(2) the plans initially developed under Section
1002.201(b), Health and Safety Code, as added by this Act;
(3) the changes in existing law that would be
necessary to implement the assessment and plans described by
Subdivisions (1) and (2) of this subsection; and
(4) the cost implications to state agencies to
implement the assessment and plans described by Subdivisions (1)
and (2) of this subsection.
(b) Not later than December 1, 2012, the Texas Institute of
Health Care Quality and Efficiency shall submit a report regarding
an all payor claims database to the governor, the lieutenant
governor, the speaker of the house of representatives, and the
chairs of the appropriate standing committees of the legislature
outlining:
(1) the feasibility and desirability of establishing a
centralized database for health care claims;
(2) the initial plan developed under Section
1002.202(b), Health and Safety Code, as added by this Act;
(3) the changes in existing law that would be
necessary to implement the plan described by Subdivision (2) of
this subsection; and
(4) the cost implications to state agencies to
implement the plan described by Subdivision (2) of this subsection.
ARTICLE 3. HEALTH CARE COLLABORATIVES
SECTION 3.01. Subtitle C, Title 6, Insurance Code, is
amended by adding Chapter 848 to read as follows:
CHAPTER 848. HEALTH CARE COLLABORATIVES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 848.001. DEFINITIONS. In this chapter:
(1) "Affiliate" means a person who controls, is
controlled by, or is under common control with one or more other
persons.
(2) "Health care collaborative" means an
organization:
(A) consisting of participating physicians or
health care providers, or entities contracting on behalf of
participating physicians or health care providers, that is
organized within a formal legal structure to provide or arrange to
provide health care services; and
(B) capable of receiving and distributing
payments to participating physicians or health care providers.
(3) "Health care services" means services provided by
a physician or health care provider to prevent, alleviate, cure, or
heal human illness or injury. The term includes:
(A) pharmaceutical services;
(B) medical, chiropractic, or dental care; and
(C) hospitalization.
(4) "Health care provider" means any person,
partnership, professional association, corporation, facility, or
institution licensed, certified, registered, or chartered by this
state to provide health care services. The term includes a hospital
but does not include a physician.
(5) "Health maintenance organization" means an
organization operating under Chapter 843.
(6) "Hospital" means a general or special hospital,
including a public or private institution licensed under Chapter
241 or 577, Health and Safety Code.
(7) "Institute" means the Texas Institute of Health
Care Quality and Efficiency established under Chapter 1002, Health
and Safety Code.
(8) "Physician" means:
(A) an individual licensed to practice medicine
in this state;
(B) a professional association organized under
the Texas Professional Association Act (Article 1528f, Vernon's
Texas Civil Statutes) or the Texas Professional Association Law by
an individual or group of individuals licensed to practice medicine
in this state;
(C) a partnership or limited liability
partnership formed by a group of individuals licensed to practice
medicine in this state;
(D) a nonprofit health corporation certified
under Section 162.001, Occupations Code;
(E) a company formed by a group of individuals
licensed to practice medicine in this state under the Texas Limited
Liability Company Act (Article 1528n, Vernon's Texas Civil
Statutes) or the Texas Professional Limited Liability Company Law;
or
(F) an organization wholly owned and controlled
by individuals licensed to practice medicine in this state.
(9) "Potentially preventable event" has the meaning
assigned by Section 1002.001, Health and Safety Code.
Sec. 848.002. USE OF INSURANCE-RELATED TERMS BY HEALTH CARE
COLLABORATIVE. A health care collaborative that is not an insurer
or health maintenance organization may not use in its name,
contracts, or literature:
(1) the following words or initials:
(A) "insurance";
(B) "casualty";
(C) "surety";
(D) "mutual";
(E) "health maintenance organization"; or
(F) "HMO"; or
(2) any other words or initials that are:
(A) descriptive of the insurance, casualty,
surety, or health maintenance organization business; or
(B) deceptively similar to the name or
description of an insurer, surety corporation, or health
maintenance organization engaging in business in this state.
Sec. 848.003. APPLICABILITY OF INSURANCE LAWS. An
organization may not arrange for or provide health care services to
enrollees on a prepaid or indemnity basis through health insurance
or a health benefit plan, including a health care plan, as defined
by Section 843.002, unless the organization holds the appropriate
certificate of authority issued under:
(1) Chapter 841;
(2) Chapter 842;
(3) Chapter 843; or
(4) Chapter 883.
[Sections 848.004-848.050 reserved for expansion]
SUBCHAPTER B. AUTHORITY TO ENGAGE IN BUSINESS
Sec. 848.051. OPERATION OF HEALTH CARE COLLABORATIVE. A
health care collaborative certified under this chapter may provide
or arrange to provide health care services under a contract with a
governmental or private entity.
Sec. 848.052. CERTIFICATE OF AUTHORITY REQUIRED. (a) An
organization may not organize or operate a health care
collaborative in this state unless the organization holds a
certificate of authority issued under this chapter.
(b) An organization may not use the term "health care
collaborative" in its name, contracts, or literature unless the
organization holds a certificate of authority issued under this
chapter.
Sec. 848.053. EXCEPTIONS. (a) An organization is not
required to obtain a certificate of authority under this chapter if
the organization holds an appropriate certificate of authority
issued under another chapter of this code.
(b) An organization is not required to obtain a certificate
of authority under this chapter to the extent that the organization
provides health care services only under contract with:
(1) the Centers for Medicare and Medicaid Services as
a health care collaborative under the Medicare shared savings
program (42 U.S.C. Section 1395jjj); or
(2) the Health and Human Services Commission under
Chapter 531, Government Code.
Sec. 848.054. CERTIFICATE APPLICATION. (a) An organization
may apply to the commissioner for and obtain a certificate of
authority to organize and operate a health care collaborative.
(b) An application for a certificate of authority must:
(1) comply with all rules adopted by the commissioner;
and
(2) be verified by the applicant or an officer or other
authorized representative of the applicant.
(c) An application for a certificate of authority is
confidential and is not subject to disclosure under Chapter 552,
Government Code.
Sec. 848.055. REQUIREMENTS FOR APPROVAL OF APPLICATION.
The commissioner shall issue a certificate of authority on payment
of the application fee prescribed by Section 848.152 if the
commissioner is satisfied that:
(1) the applicant meets the requirements of Section
848.054;
(2) with respect to health care services to be
provided, the applicant:
(A) has demonstrated the willingness and
potential ability to ensure that the health care services will be
provided in a manner that:
(i) increases collaboration among health
care providers and integrates health care services;
(ii) promotes quality-based health care
outcomes, patient engagement, and coordination of services;
(iii) reduces the occurrence of potentially
preventable events; and
(iv) contains health care costs;
(B) has processes to develop, compile, evaluate,
and report statistics relating to the quality and cost of health
care services, the pattern of utilization of services, and
availability and accessibility of services; and
(C) has processes to address complaints made by
patients receiving services provided through the organization; and
(3) the applicant is in compliance with all rules
adopted by the commissioner under Section 848.151.
Sec. 848.056. DENIAL OF CERTIFICATE OF AUTHORITY;
LIMITATIONS ON MARKET POWER. (a) The commissioner may not issue a
certificate of authority if the commissioner determines that:
(1) the applicant's proposed plan of operation does
not meet the requirements of Section 848.055;
(2) the applicant's proposed health care collaborative
is likely to reduce competition in any market for physician,
hospital, or ancillary health care services due to:
(A) the size of the health care collaborative; or
(B) the composition of the collaborative,
including the distribution of physicians by specialty within the
collaborative in relation to the number of competing health care
providers in the health care collaborative's geographic market; or
(3) the applicant's proposed health care collaborative
is likely to possess market power sufficient to raise rates above
competitive levels.
(b) The commissioner may revoke a health care
collaborative's certificate of authority as provided by Section
848.201 if the commissioner determines that a change in the health
care collaborative's market, or a change in the size or composition
of the health care collaborative, has occurred that is likely to
result in reduced competition, as described by Subsection (a)(2),
or market power sufficient to raise rates above competitive levels,
as described by Subsection (a)(3).
(c) If the commissioner denies an application for a
certificate of authority under Subsection (a), the commissioner
shall notify the applicant that the plan is deficient and specify
the deficiencies.
[Sections 848.057-848.100 reserved for expansion]
SUBCHAPTER C. GENERAL POWERS AND DUTIES OF HEALTH CARE
COLLABORATIVE
Sec. 848.101. PROVIDING OR ARRANGING FOR SERVICES. A
health care collaborative may provide or arrange for health care
services through contracts with physicians and health care
providers or with entities contracting on behalf of participating
physicians and health care providers.
Sec. 848.102. INSURANCE, REINSURANCE, INDEMNITY, AND
REIMBURSEMENT. A health care collaborative may contract with an
insurer authorized to engage in business in this state to provide
insurance, reinsurance, indemnification, or reimbursement against
the cost of health care and medical care services provided by the
health care collaborative.
Sec. 848.103. PAYMENT BY GOVERNMENTAL OR PRIVATE ENTITY.
(a) A health care collaborative may:
(1) contract for and accept payments from a
governmental or private entity for all or part of the cost of
services provided or arranged for by the health care collaborative;
and
(2) distribute payments to participating physicians
and health care providers.
(b) Notwithstanding Section 164.052(a)(13) or (17) or
165.156, Occupations Code, a health care collaborative may contract
for, receive, allocate, and distribute payments for health care
services provided by a physician or health care provider
participating within the organization.
Sec. 848.104. CONTRACTS FOR ADMINISTRATIVE OR MANAGEMENT
SERVICES. A health care collaborative may contract with any
person, including an affiliated entity, to perform administrative,
management, or any other required functions on behalf of the health
care collaborative.
Sec. 848.105. CORPORATION, PARTNERSHIP, OR ASSOCIATION
POWERS. A health care collaborative has all powers of a
partnership, association, corporation, or limited liability
company, including a professional association or corporation, as
appropriate under the organizational documents of the health care
collaborative, that are not in conflict with this chapter or other
applicable law.
Sec. 848.106. QUALITY AND COST OF HEALTH CARE SERVICES.
(a) A health care collaborative shall establish policies to
improve the quality and control the cost of health care services
provided by participating physicians and health care providers that
are consistent with prevailing professionally recognized standards
of medical practice. The policies must include standards and
procedures relating to:
(1) the selection and credentialing of participating
physicians and health care providers;
(2) the development, implementation, and monitoring
of evidence-based best practices and other processes to improve the
quality and control the cost of health care services provided by
participating physicians and health care providers, including
practices or processes to reduce the occurrence of potentially
preventable events; and
(3) the development, implementation, and monitoring
of processes to improve patient engagement and coordination of
health care services provided by participating physicians and
health care providers.
(b) The governing body of a health care collaborative shall
establish a procedure for the periodic review of quality
improvement and cost control measures.
Sec. 848.107. COMPLAINT SYSTEM. A health care
collaborative shall implement and maintain a complaint system that
provides reasonable procedures to resolve an oral or written
complaint initiated by a complainant concerning health care
services provided by participating physicians or health care
providers. The complaint system must include a process for the
notice and appeal of a complaint.
Sec. 848.108. FINANCIAL RESERVE REQUIREMENTS. A health
care collaborative shall maintain reserves in an amount determined
by commissioner rule to be adequate for the liabilities and risks
assumed by the health care collaborative, as computed in accordance
with accepted standards, practices, and procedures relating to the
liabilities and risks for which the reserves are maintained,
including known and unknown components and anticipated expenses of
providing health care services.
Sec. 848.109. VALIDITY OF OPERATIONS AND TRADE PRACTICES OF
HEALTH CARE COLLABORATIVES. The operations and trade practices of
a health care collaborative that are consistent with the provisions
of this chapter, the rules adopted under this chapter, and
applicable federal antitrust laws are presumed to be consistent
with Chapter 15, Business & Commerce Code, or any other applicable
provision of law.
[Sections 848.110-848.150 reserved for expansion]
SUBCHAPTER D. REGULATION OF HEALTH CARE COLLABORATIVES
Sec. 848.151. RULES. The commissioner in consultation with
the institute may adopt reasonable rules as necessary and proper
to:
(1) improve the quality and efficiency of health care
delivery by a health care collaborative;
(2) facilitate the creation of innovative health care
collaborative payment systems; and
(3) implement the requirements of this chapter.
Sec. 848.152. FEES. (a) The commissioner shall, within
the limits prescribed by this section, prescribe the fees to be
charged under this section.
(b) Fees collected under this section shall be deposited to
the credit of the Texas Department of Insurance operating account.
(c) A health care collaborative shall pay to the
commissioner:
(1) an application fee in an amount not to exceed $750
for filing and review of its original application for a certificate
of authority; and
(2) an annual fee in an amount not to exceed $750 for
renewal of the certificate of authority.
(d) A health care collaborative shall pay to the
commissioner a fee in an amount assessed by the commissioner and
paid in accordance with rules adopted by the commissioner for the
expenses of an examination under Section 848.154 that:
(1) are incurred by the commissioner or under the
commissioner's authority; and
(2) are directly attributable to that examination,
including the actual salaries and expenses of the examiners
directly attributable to that examination, as determined under
rules adopted by the commissioner.
Sec. 848.153. ANNUAL REPORT. (a) Not later than March 1 of
each year, a health care collaborative shall file with the
commissioner a report covering the preceding calendar year.
(b) The report shall:
(1) be verified by at least two principal officers;
(2) be in a form prescribed by the commissioner; and
(3) include:
(A) a financial statement of the health care
collaborative, including its balance sheet and receipts and
disbursements for the preceding calendar year, certified by an
independent public accountant; and
(B) a statement of:
(i) the service area of the health care
collaborative;
(ii) the number and types of physicians and
health care providers participating within the health care
collaborative;
(iii) an evaluation of the quality and cost
of health care services provided by the health care collaborative;
and
(iv) an evaluation of the health care
collaborative's processes to promote evidence-based medicine,
patient engagement, and coordination of health care services
provided by the organization.
(c) An annual report filed with the commissioner under this
section is confidential and is not subject to disclosure under
Chapter 552, Government Code.
Sec. 848.154. EXAMINATIONS. (a) The commissioner may
examine the financial affairs and operations of any health care
collaborative or applicant for a certificate of authority under
this chapter.
(b) A health care collaborative shall make its books and
records relating to its financial affairs and operations available
for an examination by the commissioner.
(c) On request of the commissioner, a health care
collaborative shall provide to the commissioner:
(1) a copy of any contract, agreement, or other
arrangement between the health care collaborative and a physician
or health care provider; and
(2) a general description of the fee arrangements
between the health care collaborative and the physician or health
care provider.
(d) Documentation provided to the commissioner under this
section is confidential and is not subject to disclosure under
Chapter 552, Government Code.
[Sections 848.155-848.200 reserved for expansion]
SUBCHAPTER E. ENFORCEMENT
Sec. 848.201. ENFORCEMENT ACTIONS. (a) After notice and
opportunity for a hearing, the commissioner may:
(1) suspend or revoke a certificate of authority
issued to a health care collaborative under this chapter;
(2) impose sanctions under Chapter 82;
(3) issue a cease and desist order under Chapter 83; or
(4) impose administrative penalties under Chapter 84.
(b) The commissioner may take an enforcement action listed
in Subsection (a) against a health care collaborative if the
commissioner finds that the health care collaborative:
(1) is operating in a manner that is:
(A) significantly contrary to its basic
organizational documents; or
(B) contrary to the manner described in and
reasonably inferred from other information submitted under Section
848.055;
(2) does not meet the requirements of Section 848.055;
(3) cannot fulfill its obligation to provide health
care services as required under its contracts with governmental or
private entities;
(4) does not meet the financial reserve requirements
described by Section 848.108;
(5) has not implemented the complaint system required
by Section 848.107 in a manner to resolve reasonably valid
complaints;
(6) has advertised or merchandised its services in an
untrue, misrepresentative, misleading, deceptive, or unfair manner
or a person on behalf of the health care collaborative has
advertised or merchandised the health care collaborative's
services in an untrue, misrepresentative, misleading, deceptive,
or untrue manner;
(7) has not complied substantially with this chapter
or a rule adopted under this chapter; or
(8) has not taken corrective action the commissioner
considers necessary to correct a failure to comply with this
chapter, any applicable provision of this code, or any applicable
rule or order of the commissioner not later than the 30th day after
the date of notice of the failure or within any longer period
specified in the notice and determined by the commissioner to be
reasonable.
Sec. 848.202. OPERATIONS DURING SUSPENSION OR AFTER
REVOCATION OF CERTIFICATE OF AUTHORITY. (a) During the period a
certificate of authority of a health care collaborative is
suspended, the health care collaborative may not:
(1) enter into a new contract with a governmental or
private entity; or
(2) advertise or solicit in any way.
(b) After a certificate of authority of a health care
collaborative is revoked, the health care collaborative:
(1) shall proceed, immediately following the
effective date of the order of revocation, to conclude its affairs;
(2) may not conduct further business except as
essential to the orderly conclusion of its affairs; and
(3) may not advertise or solicit in any way.
(c) Notwithstanding Subsection (b), the commissioner may,
by written order, permit the further operation of the health care
collaborative to the extent that the commissioner finds necessary
to serve the best interest of governmental or private entities that
have entered into contracts with the health care collaborative.
Sec. 848.203. INJUNCTIONS. If the commissioner believes
that a health care collaborative or another person is violating or
has violated this chapter or a rule adopted under this chapter, the
attorney general at the request of the commissioner may bring an
action in a Travis County district court to enjoin the violation and
obtain other relief the court considers appropriate.
SECTION 3.02. Section 74.001(a)(12)(A), Civil Practice and
Remedies Code, is amended to read as follows:
(A) "Health care provider" means any person,
partnership, professional association, corporation, facility, or
institution duly licensed, certified, registered, or chartered by
the State of Texas to provide health care, including:
(i) a registered nurse;
(ii) a dentist;
(iii) a podiatrist;
(iv) a pharmacist;
(v) a chiropractor;
(vi) an optometrist; [or]
(vii) a health care institution; or
(viii) a health care collaborative
certified under Chapter 848, Insurance Code.
SECTION 3.03. Subchapter O, Chapter 285, Health and Safety
Code, is amended by adding Section 285.303 to read as follows:
Sec. 285.303. ESTABLISHMENT OF HEALTH CARE COLLABORATIVE.
(a) A hospital district created under general or special law may
form and sponsor a nonprofit health care collaborative that is
certified under Chapter 848, Insurance Code.
(b) The governing body of the hospital district shall
appoint the board of the health care collaborative formed under
this section.
(c) The hospital district may contribute money to or solicit
money for the health care collaborative. If the district
contributes money to or solicits money for the health care
collaborative, the district shall establish procedures and
controls sufficient to ensure that the money is used by the health
care collaborative for public purposes.
SECTION 3.04. Section 102.005, Occupations Code, is amended
to read as follows:
Sec. 102.005. APPLICABILITY TO CERTAIN ENTITIES. Section
102.001 does not apply to:
(1) a licensed insurer;
(2) a governmental entity, including:
(A) an intergovernmental risk pool established
under Chapter 172, Local Government Code; and
(B) a system as defined by Section 1601.003,
Insurance Code;
(3) a group hospital service corporation; [or]
(4) a health maintenance organization that
reimburses, provides, offers to provide, or administers hospital,
medical, dental, or other health-related benefits under a health
benefits plan for which it is the payor; or
(5) a health care collaborative certified under
Chapter 848, Insurance Code.
SECTION 3.05. Section 151.002(a)(5), Occupations Code, is
amended to read as follows:
(5) "Health care entity" means:
(A) a hospital licensed under Chapter 241 or 577,
Health and Safety Code;
(B) an entity, including a health maintenance
organization, group medical practice, nursing home, health science
center, university medical school, hospital district, hospital
authority, or other health care facility, that:
(i) provides or pays for medical care or
health care services; and
(ii) follows a formal peer review process
to further quality medical care or health care;
(C) a professional society or association of
physicians, or a committee of such a society or association, that
follows a formal peer review process to further quality medical
care or health care; [or]
(D) an organization established by a
professional society or association of physicians, hospitals, or
both, that:
(i) collects and verifies the authenticity
of documents and other information concerning the qualifications,
competence, or performance of licensed health care professionals;
and
(ii) acts as a health care facility's agent
under the Health Care Quality Improvement Act of 1986 (42 U.S.C.
Section 11101 et seq.); or
(E) a health care collaborative certified under
Chapter 848, Insurance Code.
SECTION 3.06. Not later than April 1, 2012, the
commissioner of insurance and the board of directors of the Texas
Institute of Health Care Quality and Efficiency shall adopt rules
as necessary to implement this article.
ARTICLE 4. PATIENT IDENTIFICATION
SECTION 4.01. Subchapter A, Chapter 311, Health and Safety
Code, is amended by adding Section 311.004 to read as follows:
Sec. 311.004. STANDARDIZED PATIENT RISK IDENTIFICATION
SYSTEM. (a) In this section:
(1) "Department" means the Department of State Health
Services.
(2) "Hospital" means a general or special hospital as
defined by Section 241.003. The term includes a hospital
maintained or operated by this state.
(b) The department shall coordinate with hospitals to
develop a statewide standardized patient risk identification
system under which a patient with a specific medical risk may be
readily identified through the use of a system that communicates to
hospital personnel the existence of that risk. The executive
commissioner of the Health and Human Services Commission shall
appoint an ad hoc committee of hospital representatives to assist
the department in developing the statewide system.
(c) The department shall require each hospital to implement
and enforce the statewide standardized patient risk identification
system developed under Subsection (b) unless the department
authorizes an exemption for the reason stated in Subsection (d).
(d) The department may exempt from the statewide
standardized patient risk identification system a hospital that
seeks to adopt another patient risk identification methodology
supported by evidence-based protocols for the practice of medicine.
(e) The department shall modify the statewide standardized
patient risk identification system in accordance with
evidence-based medicine as necessary.
(f) The executive commissioner of the Health and Human
Services Commission may adopt rules to implement this section.
ARTICLE 5. REPORTING OF HEALTH CARE-ASSOCIATED INFECTIONS
SECTION 5.01. Section 98.001, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended by adding Subdivision (10-a) to
read as follows:
(10-a) "Potentially preventable complication" and
"potentially preventable readmission" have the meanings assigned
by Section 1002.001, Health and Safety Code.
SECTION 5.02. Section 98.102(c), Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended to read as follows:
(c) The data reported by health care facilities to the
department must contain sufficient patient identifying information
to:
(1) avoid duplicate submission of records;
(2) allow the department to verify the accuracy and
completeness of the data reported; and
(3) for data reported under Section 98.103 [or
98.104], allow the department to risk adjust the facilities'
infection rates.
SECTION 5.03. Section 98.103, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended by amending Subsection (b) and
adding Subsection (d-1) to read as follows:
(b) A pediatric and adolescent hospital shall report the
incidence of surgical site infections, including the causative
pathogen if the infection is laboratory-confirmed, occurring in the
following procedures to the department:
(1) cardiac procedures, excluding thoracic cardiac
procedures;
(2) ventricular [ventriculoperitoneal] shunt
procedures; and
(3) spinal surgery with instrumentation.
(d-1) The executive commissioner by rule may designate the
federal Centers for Disease Control and Prevention's National
Healthcare Safety Network, or its successor, to receive reports of
health care-associated infections from health care facilities on
behalf of the department. A health care facility must file a report
required in accordance with a designation made under this
subsection in accordance with the National Healthcare Safety
Network's definitions, methods, requirements, and procedures. A
health care facility shall authorize the department to have access
to facility-specific data contained in a report filed with the
National Healthcare Safety Network in accordance with a designation
made under this subsection.
SECTION 5.04. Section 98.1045, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended by adding Subsection (c) to read
as follows:
(c) The executive commissioner by rule may designate an
agency of the United States Department of Health and Human Services
to receive reports of preventable adverse events by health care
facilities on behalf of the department. A health care facility
shall authorize the department to have access to facility-specific
data contained in a report made in accordance with a designation
made under this subsection.
SECTION 5.05. Subchapter C, Chapter 98, Health and Safety
Code, as added by Chapter 359 (S.B. 288), Acts of the 80th
Legislature, Regular Session, 2007, is amended by adding Sections
98.1046 and 98.1047 to read as follows:
Sec. 98.1046. PUBLIC REPORTING OF CERTAIN POTENTIALLY
PREVENTABLE EVENTS FOR HOSPITALS. (a) In consultation with the
Texas Institute of Health Care Quality and Efficiency under Chapter
1002, the department shall publicly report outcomes for potentially
preventable complications and potentially preventable readmissions
for hospitals.
(b) The department shall make the reports compiled under
Subsection (a) available to the public on the department's Internet
website.
Sec. 98.1047. STUDIES ON LONG-TERM CARE FACILITY REPORTING
OF ADVERSE HEALTH CONDITIONS. (a) The department shall study which
adverse health conditions commonly occur in long-term care
facilities and, of those health conditions, which are potentially
preventable.
(b) The department shall develop recommendations for
reporting adverse health conditions identified under Subsection
(a).
SECTION 5.06. Section 98.105, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended to read as follows:
Sec. 98.105. REPORTING SYSTEM MODIFICATIONS. Based on the
recommendations of the advisory panel, the executive commissioner
by rule may modify in accordance with this chapter the list of
procedures that are reportable under Section 98.103 [or 98.104].
The modifications must be based on changes in reporting guidelines
and in definitions established by the federal Centers for Disease
Control and Prevention.
SECTION 5.07. Sections 98.106(a) and (b), Health and Safety
Code, as added by Chapter 359 (S.B. 288), Acts of the 80th
Legislature, Regular Session, 2007, are amended to read as follows:
(a) The department shall compile and make available to the
public a summary, by health care facility, of:
(1) the infections reported by facilities under
Section [Sections] 98.103 [and 98.104]; and
(2) the preventable adverse events reported by
facilities under Section 98.1045.
(b) Information included in the departmental summary with
respect to infections reported by facilities under Section
[Sections] 98.103 [and 98.104] must be risk adjusted and include a
comparison of the risk-adjusted infection rates for each health
care facility in this state that is required to submit a report
under Section [Sections] 98.103 [and 98.104].
SECTION 5.08. Subchapter C, Chapter 98, Health and Safety
Code, as added by Chapter 359 (S.B. 288), Acts of the 80th
Legislature, Regular Session, 2007, is amended by adding Section
98.1065 to read as follows:
Sec. 98.1065. INCENTIVES; RECOGNITION FOR HEALTH CARE
QUALITY. (a) The department, in consultation with the Texas
Institute of Health Care Quality and Efficiency, shall develop a
recognition program to recognize exemplary health care providers
and health care facilities for superior quality of health care.
(b) The department may:
(1) make available to the public the list of exemplary
providers and facilities recognized under this section; and
(2) authorize the providers or facilities to use the
receipt of the recognition in their advertising materials.
(c) The executive commissioner of the Health and Human
Services Commission may adopt rules to implement this section.
SECTION 5.09. Section 98.108, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended to read as follows:
Sec. 98.108. FREQUENCY OF REPORTING. In consultation with
the advisory panel, the executive commissioner by rule shall
establish the frequency of reporting by health care facilities
required under Sections 98.103[, 98.104,] and 98.1045. Facilities
may not be required to report more frequently than monthly
[quarterly].
SECTION 5.10. Section 98.110, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is amended to read as follows:
Sec. 98.110. DISCLOSURE AMONG CERTAIN AGENCIES. (a)
Notwithstanding any other law, the department may disclose
information reported by health care facilities under Section
98.103[, 98.104,] or 98.1045 to other programs within the
department, to the Health and Human Services Commission, [and] to
other health and human services agencies, as defined by Section
531.001, Government Code, and to the federal Centers for Disease
Control and Prevention for public health research or analysis
purposes only, provided that the research or analysis relates to
health care-associated infections or preventable adverse events.
The privilege and confidentiality provisions contained in this
chapter apply to such disclosures.
(b) If the executive commissioner designates an agency of
the United States Department of Health and Human Services to
receive reports of health care-associated infections or
preventable adverse events, that agency may use the information
submitted for purposes allowed by federal law.
SECTION 5.11. Section 98.104, Health and Safety Code, as
added by Chapter 359 (S.B. 288), Acts of the 80th Legislature,
Regular Session, 2007, is repealed.
ARTICLE 6. INFORMATION MAINTAINED BY DEPARTMENT OF STATE HEALTH
SERVICES
SECTION 6.01. Section 108.002, Health and Safety Code, is
amended by adding Subdivisions (4-a) and (8-a) and amending
Subdivision (7) to read as follows:
(4-a) "Commission" means the Health and Human Services
Commission.
(7) "Department" means the [Texas] Department of State
Health Services.
(8-a) "Executive commissioner" means the executive
commissioner of the Health and Human Services Commission.
SECTION 6.02. Chapter 108, Health and Safety Code, is
amended by adding Section 108.0026 to read as follows:
Sec. 108.0026. TRANSFER OF DUTIES; REFERENCE TO COUNCIL.
(a) The powers and duties of the Texas Health Care Information
Council under this chapter were transferred to the Department of
State Health Services in accordance with Section 1.19, Chapter 198
(H.B. 2292), Acts of the 78th Legislature, Regular Session, 2003.
(b) In this chapter or other law, a reference to the Texas
Health Care Information Council means the Department of State
Health Services.
SECTION 6.03. Section 108.009(h), Health and Safety Code,
is amended to read as follows:
(h) The department [council] shall coordinate data
collection with the data submission formats used by hospitals and
other providers. The department [council] shall accept data in the
format developed by the American National Standards Institute
[National Uniform Billing Committee (Uniform Hospital Billing Form
UB 92) and HCFA-1500] or its successor [their successors] or other
nationally [universally] accepted standardized forms that
hospitals and other providers use for other complementary purposes.
SECTION 6.04. Section 108.013, Health and Safety Code, is
amended by amending Subsections (a), (b), (c), (d), (g), (i), and
(j) and adding Subsections (k), (l), (m), and (n) to read as
follows:
(a) The data received by the department under this chapter
[council] shall be used by the department and commission [council]
for the benefit of the public. Subject to specific limitations
established by this chapter and executive commissioner [council]
rule, the department [council] shall make determinations on
requests for information in favor of access.
(b) The executive commissioner [council] by rule shall
designate the characters to be used as uniform patient identifiers.
The basis for assignment of the characters and the manner in which
the characters are assigned are confidential.
(c) Unless specifically authorized by this chapter, the
department [council] may not release and a person or entity may not
gain access to any data obtained under this chapter:
(1) that could reasonably be expected to reveal the
identity of a patient;
(2) that could reasonably be expected to reveal the
identity of a physician;
(3) disclosing provider discounts or differentials
between payments and billed charges;
(4) relating to actual payments to an identified
provider made by a payer; or
(5) submitted to the department [council] in a uniform
submission format that is not included in the public use data set
established under Sections 108.006(f) and (g), except in accordance
with Section 108.0135.
(d) Except as provided by this section, all [All] data
collected and used by the department [and the council] under this
chapter is subject to the confidentiality provisions and criminal
penalties of:
(1) Section 311.037;
(2) Section 81.103; and
(3) Section 159.002, Occupations Code.
(g) Unless specifically authorized by this chapter, the
department [The council] may not release data elements in a manner
that will reveal the identity of a patient. The department
[council] may not release data elements in a manner that will reveal
the identity of a physician.
(i) Notwithstanding any other law and except as provided by
this section, the [council and the] department may not provide
information made confidential by this section to any other agency
of this state.
(j) The executive commissioner [council] shall by rule[,
with the assistance of the advisory committee under Section
108.003(g)(5),] develop and implement a mechanism to comply with
Subsections (c)(1) and (2).
(k) The department may disclose data collected under this
chapter that is not included in public use data to any department or
commission program if the disclosure is reviewed and approved by
the institutional review board under Section 108.0135.
(l) Confidential data collected under this chapter that is
disclosed to a department or commission program remains subject to
the confidentiality provisions of this chapter and other applicable
law. The department shall identify the confidential data that is
disclosed to a program under Subsection (k). The program shall
maintain the confidentiality of the disclosed confidential data.
(m) The following provisions do not apply to the disclosure
of data to a department or commission program:
(1) Section 81.103;
(2) Sections 108.010(g) and (h);
(3) Sections 108.011(e) and (f);
(4) Section 311.037; and
(5) Section 159.002, Occupations Code.
(n) Nothing in this section authorizes the disclosure of
physician identifying data.
SECTION 6.05. Section 108.0135, Health and Safety Code, is
amended to read as follows:
Sec. 108.0135. INSTITUTIONAL [SCIENTIFIC] REVIEW BOARD
[PANEL]. (a) The department [council] shall establish an
institutional [a scientific] review board [panel] to review and
approve requests for access to data not contained in [information
other than] public use data. The members of the institutional
review board must [panel shall] have experience and expertise in
ethics, patient confidentiality, and health care data.
(b) To assist the institutional review board [panel] in
determining whether to approve a request for information, the
executive commissioner [council] shall adopt rules similar to the
federal Centers for Medicare and Medicaid Services' [Health Care
Financing Administration's] guidelines on releasing data.
(c) A request for information other than public use data
must be made on the form prescribed [created] by the department
[council].
(d) Any approval to release information under this section
must require that the confidentiality provisions of this chapter be
maintained and that any subsequent use of the information conform
to the confidentiality provisions of this chapter.
SECTION 6.06. Sections 108.002(5) and (18), 108.0025, and
108.009(c), Health and Safety Code, are repealed.
ARTICLE 7. EFFECTIVE DATE
SECTION 7.01. This Act takes effect September 1, 2011.