HBA-MPM H.B. 2070 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2070 By: Gray Higher Education 4/6/1999 Introduced BACKGROUND AND PURPOSE The University of Texas Medical Branch (UTMB) at Galveston is the state's oldest and largest health sciences center. Additionally, it is the only one of the state's medical schools that owns and operates hospital facilities. These hospital facilities, which are classified as general categorical (treating all types of illnesses), have served as a statewide "safety net" hospital for patients without medical coverage for more than 100 years. While UTMB's annual operating expenses are approximately $1 billion, the majority of these funds must be earned by UTMB through the provision of health care services. Managed care concepts such as HMOs have significantly altered the environment in which health care organizations operate. UTMB, however, has difficulties effectively operating in this environment due to constraints placed upon it under current law. H.B. 2070 allows UTMB flexibility with respect to entering into contracts with other health care providers, acquiring goods and services, and issuing employee retirement benefits. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the medical branch in SECTION 1 (Section 74.008, Education Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Subchapter A, Chapter 74, Education Code, by adding Sections 74.005, 74.006, 74.007, and 74.008, as follows: Sec. 74.005. TREATMENT OF INDIGENT PATIENTS. (a) Authorizes the medical branch to enter into a contract with a county, public hospital, or hospital district to provide treatment to residents of those service areas who are eligible for health care assistance under Chapter 61 (Indigent Health Care and Treatment Act), Health and Safety Code. (b) Prohibits the liability of a county, public hospital, or hospital district to the medical branch for the treatment of residents of those service areas by the medical branch from exceeding the responsibility of a county as provided by Chapter 61, Health and Safety Code, unless agreed to by the county, public hospital, or hospital district in a contract entered into under this section. (c) Requires the liability of a county, public hospital, or hospital district, if a contract is entered into under this section, to take into consideration the actual costs of the medical branch in providing health care services under the contract. Prohibits the liability of these entities from exceeding the medical branch's costs. (d) Provides that the medical branch must receive the approval of a county, public hospital, or hospital district before providing nonemergency heath care services to an eligible resident of those service areas if a contract is not entered into under this section. Provides that if approval is not received, these entities are not liable to the medical branch for any nonemergency care provided to the resident, and that if approval is received, these entities are liable to the medical branch under Subsection (b) for the services provided by the branch to the resident. (e) Assigns the terms "eligible resident," "hospital district," "public hospital," and "service area" the meanings given under Chapter 61, Health and Safety Code. Sec. 74.006. SUFFICIENCY OF INSTITUTIONAL FUNDS, FEES, AND PATIENT BASE. Requires the medical branch to ensure that its funds and its hospital and clinic fees and patient base are sufficient to fund an achieve the mission and strategic plan of the branch and protect the state's investment in the development of the branch. Sec. 74.007. INCENTIVE RETIREMENT PLANS. Authorizes the medical branch to offer incentive retirement plans to employees of the branch who elect to retire under other state law. Provides that the incentive must be paid from the branch's funds or hospital or clinic fees. Provides that an institutional plan providing for incentive retirement plans must be filed with the Legislative Budget Board no later than the 61st day after the plan is implemented. Prohibits the branch from rehiring an employee receiving an incentive under this section without the specific approval of the president. Sec. 74.008. ACQUISITION OF GOODS AND SERVICES. (a) Authorizes a medical branch to acquire goods and services by the method that provides best value to the branch, including certain methods of purchase, and requires the branch to determine what is the best value to the branch using certain criteria. Authorizes the state auditor to audit the branch's purchases of goods or services. Authorizes the branch to adopt rules and procedures for the acquisition of the goods and services. Provides that to the extent of any conflict, this section prevails over any other law relating to the purchase of goods and services except a law relating to contracting with historically underutilized businesses. Provides that Subtitle D (State Purchasing and General Services), Title 10 (Government Code) and Chapter 2254 (Professional and Consulting Services), Government Code, do not apply to the purchases of goods and services made under this section. SECTION 2. Repealer: Subchapter B (Moody State School for Cerebral Palsied Children), Chapter 74, Education Code. SECTION 3. Effective date for Section 1 of this Act: September 1, 1999. Effective date for Section 2 of this Act: September 1, 2001. Requires the University of Texas Medical Branch at Galveston, the Moody State School for Cerebral Palsied Children, and the University of Texas Medical Branch at Galveston Special School to discuss and enter into a memorandum of understanding relating to the transfer of powers, duties, property, personnel, and other assets or liabilities of these institutions no later than January 1, 2000. Provides that funding that could have been provided to the Moody State School for Cerebral Palsied Children and the University of Texas Medical Branch at Galveston Special School under Subchapter B, Chapter 74, Education Code, may be provided to the University of Texas Medical Branch at Galveston if the medical branch performs the same duties as the providing institutions before the repeal of Subchapter B, Chapter 74, Education Code. SECTION 4.Emergency clause. Effective date: upon passage.