HBA-DMH H.B. 3437 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3437 By: Wohlgemuth Civil Practices 4/23/2001 Introduced BACKGROUND AND PURPOSE Over the last several years, some nursing homes in Texas have struggled financially, sometimes leading to bankruptcy. Factors contributing to this problem include the cost of liability insurance and increasing civil litigation. The increase in number of lawsuits has reduced nursing home operating funds in some instances and contributed to the increasing cost of liability insurance. According to the interim study by the House Committee on Human Services, the average claim paid in Texas by nursing homes in a lawsuit is $230,000 compared to the national average of $47,900. One aspect of regulation of nursing homes includes survey reports done by the Texas Department of Human Services (DHS) to assess problems and areas that need improvement. While the reports are useful tools for accountability in nursing homes, the reports do not always provide an accurate account of the situation in a nursing home. Under current law, the reports can be accessed by anyone and subsequently the reports are often used by attorneys in lawsuits. The reports are also considered admissible evidence in a lawsuit, even if the report is under appeal with DHS. House Bill 3437 modifies the admissibility of evidence in a civil action against a convalescent or nursing home. 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. ANALYSIS House Bill 3437 amends the Human Resources and Health and Safety codes to establish facts and findings that are not admissible as evidence in a civil action against a convalescent or nursing home and specifies conditions for allowing admissibility of certain facts and findings. The bill provides that these provisions do not apply in an enforcement action in which the state or an agency or political subdivision of the state is a party. The bill amends the Human Resources Code to repeal current law relating to evidence and testimony in a civil action. EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001.