Office of House Bill AnalysisH.B. 2467
By: Chavez
Public Health


Residents in the Texas-Mexico border region suffer from inadequate medical
services compared with most Texans, in part because Medicaid funds are not
equitably distributed.  Physician to patient ratios are lowest in areas
along the border region and in rural areas and inner cities, areas known as
strategic investment areas. In February 2000, the Health and Human Services
Commission (HHSC) convened the Border Rate Work Group (work group) to study
and recommend solutions regarding Medicaid and the state child health plan
(CHIP) reimbursement rates along the Texas-Mexico border.  The work group
concluded that a lack of access to health care services along the border
has reduced the utilization rates of health care services in the region,
that the border region receives disproportionately low Medicaid
reimbursement as a result of low utilization rates, and that Medicaid and
CHIP capitation rates do not reflect the current health care environment
since the rates are based on past fee for service reimbursement rates.  The
report also found that lower revenue provides a disincentive for health
care providers to locate and remain in the border region.  The work group
recommended increasing Medicaid and CHIP reimbursement rates in strategic
investment areas to recruit more doctors and increase access to care.
House Bill 2467 establishes three pilot programs to eliminate the disparity
between counties with above average unemployment and below average per
capita income and the rest of the state, and provides physicians with a 10
percent bonus for providing health care services in these regions. 


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. 


House Bill 2467 amends the Government Code to require the commissioner of
health and human services (commissioner) to appoint an advisory committee
(committee) to develop a strategic plan for eliminating the disparities
between strategic investment areas and other areas of the state in certain
Medicaid and child health plan (CHIP) rates and expenditures.  The bill
sets forth provisions for the appointment, administration, and operation of
the committee.  The bill requires the committee to perform the research
necessary to analyze and compare the rates and expenditures, not later than
the date specified by the commissioner or September 1, 2002, and produce a
report based on the results of that analysis and comparison.  The bill
requires the committee to make recommendations for addressing the problems
created by disparities documented in the report.   

The bill requires the Health and Human Services Commission (HHSC) to
conduct three pilot programs to equalize Medicaid rates and expenditures
and provide physician incentives.  The bill provides that each pilot
program must be located in a county in a strategic investment area and meet
specified criteria.  

The bill requires HHSC to ensure that the disparities in rates and
expenditures for CHIP are eliminated as soon as practicable so that the
CHIP rates and expenditures in the strategic investment areas equal the
statewide average rates and expenditures, and provide that such changes
must be initiated not later than September 1, 2002.  The bill requires HHSC
to ensure in the pilot program areas that the disparities in  Medicaid
rates and expenditures are eliminated as soon as practicable so that the
Medicaid rates and expenditures in the pilot program areas equal those
statewide, and provides that such changes must be initiated not later than
September 1, 2002.  The bill requires HHSC to ensure that a physician
providing a service to a Medicaid recipient in the pilot program area
receives a bonus in the amount of 10 percent of the reimbursement
customarily provided to a physician providing that service in another
region of the state.  The bill requires HHSC to exclude data from strategic
investment areas in determining the statewide average capitation rates
under Medicaid managed care and CHIP and the statewide average total
professional services expenditures per Medicaid recipient or per child
enrolled in CHIP.  The bill authorizes HHSC to vary the amount of any rate
increases for professional services according to the type of service
provided.  The bill requires HHSC to develop mechanisms to pass any rate
increase directly to providers. 

The bill requires HHSC to contract with a public university to:

_measure changes occurring from September 1, 2001, to August 31, 2004, in
the number of health care providers participating in Medicaid or CHIP in
strategic investment areas and resulting effects on consumer access to
health care and consumer utilization;  

_determine any effects of the changes in rates and expenditures;

_make a recommendation regarding whether the pilot program should be
expanded to other areas of the state; and 

_submit a report to the legislature, not later than December 1, 2004.

These provisions expire September 1, 2011.


September 1, 2001.