HBA-JRA H.B. 1710 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1710 By: Maxey Public Health 3/18/1999 Introduced BACKGROUND AND PURPOSE In 1997, the 75th Texas Legislature approved a measure to improve the state's efforts to combat Medicaid fraud and overpayments and directed the Comptroller of Public Accounts to study the size and nature of fraud and overpayments in the state's health care programs. The comptroller made several recommendations for improving the management of insurance fraud, one of which was to prevent fraud in companies that contract with the state for health care services. H.B. 1710 requires managed care organizations contracting with the Health and Human Services Commission (HHS) to report to HHS descriptions of the fraud control programs used by their subcontractors and requires HHS's office of investigations and enforcement to review the information submitted. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Subchapter A, Chapter 533, Government Code, by adding Section 533.012, as follows: Sec. 533.012. INFORMATION FOR FRAUD CONTROL. (a) Requires each managed care organization contracting with Health and Human Services Commission (HHS) or an agency operating part of the state Medicaid managed care program, as appropriate, under this chapter (Implementation of Medicaid Managed Care Program), to submit to HHS a description of any financial or other business relationship between the organization and any subcontractor providing health care services under the contract, a copy of any such contract relating to the delivery of or payment for health care services, and a description of the fraud control program used by any subcontractor that delivers health care services. (b) Requires each managed care organization contracting with HHS under this chapter to submit to HHS specific information relating to each encounter in which a health care service was provided to a recipient under the contract. (c) Requires the above information to be submitted in the form and updated as required by HHS. (d) Requires HHS's office of investigations and enforcement to review the information submitted under this section as appropriate in the investigation of fraud in the Medicaid managed care program. Authorizes the Comptroller of Public Accounts to review the information in connection with its health care fraud study. SECTION 2. Amends Section 533.005, Government Code, to provide that a contract between a managed care organization and HHS for the organization to provide health care services to recipients must contain a requirement that the managed care organization provide the information required by Section 533.012 and otherwise comply and cooperate with HHS's office of investigations and enforcement. Makes conforming changes. SECTION 3. Makes application of SECTION 2 of this Act prospective. SECTION 4.Emergency clause. Effective date: upon passage.