HBA-DMD S.B. 1198 76(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 1198
By: Moncrief
Human Services
5/10/1999
Engrossed



BACKGROUND AND PURPOSE 

Currently, Texas law does not require certain convalescent and nursing
homes to execute a surety bond. S.B.1198 provides that if three or more
institutions that are licensed or required to be licensed are owned by the
same owner or controlled by the same controlling person, each of the
institutions must execute a surety bond as a condition of obtaining or
renewing a license. This bill provides that the bond must be payable to the
Texas Department of Human Services. This bill also requires the Texas Board
of Human Services to set the amounts of bonds according to a schedule
adopted, by rule. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the Texas Board of Human Services in
SECTION 1 (Section 242.0325, Health and Safety Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter B, Chapter 242, Health and Safety Code, by
adding Section 242.0325, as follows: 

Sec. 242.0325. SURETY BOND REQUIREMENT. (a) Provides that if three or more
institutions that are licensed or required to be licensed under this
chapter are owned by the same owner or controlled by the same controlling
person, each of the institutions must execute a surety bond issued by a
surety company authorized to do business in this state as a condition of
obtaining or renewing a license, provided that there are two or more
companies willing to provide this service to the institutions. 

(b) Provides that the bond must be payable to the Texas Department of Human
Services (department) and conditioned on the institution's compliance with
this chapter and rules adopted under this chapter. 

(c) Requires the Texas Board of Human Services (board) to set the amounts
of bonds under this section according to a schedule adopted, by rule.
Requires the board to schedule the amounts based on the number of residents
in an institution and on the costs incurred by the department when it is
necessary to close an institution, arrange for the placement of a trustee,
transfer residents, or take other regulatory actions in connection with a
violation of this chapter or rules adopted under this chapter. 

(d) Requires the department on behalf of the board, before the board adopts
any rule under Subsection (c), to attempt to engage in negotiated
rulemaking to assist the board in drafting the proposed rule by following
the procedures prescribed by Chapter 2008 (Negotiated Rulemaking),
Government Code, as added by Chapter 1315, Acts of the 75th Legislature,
Regular Session, 1997. 

SECTION 2.Effective date: September 1, 1999.

SECTION 3.Emergency clause.