HBA-NRS H.B. 576 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 576 By: Janek Public Health 3/23/2001 Introduced BACKGROUND AND PURPOSE Currently, physicians and providers in Texas must complete a credentialing application for each health care entity with which a physician or provider seeks to renew an affiliation. This process applies not only to hospitals, but to nursing homes, long-term care entities, large clinics, and managed care organizations. Standards established by the federal Health Care Quality Improvement Act of 1986 and the National Committee for Quality Assurance have led to an increased focus on credentialing of health care physicians and providers. The resulting duplication of physician and provider credentialing activities may be unnecessary. Currently, much of the information regarding physicians is collected, verified, and stored at the Texas State Board of Medical Examiners as part of the initial licensure process. House Bill 576 authorizes the Texas State Board of Medical Examiners (board), in consultation with an advisory committee appointed by the board, to develop a standardized credentials verification program to collect, maintain, and distribute credential data to appropriate entities. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas State Board of Medical Examiners in SECTION 2 (Sections 7.01, 7.02, 7.08 and 7.10, Article 4495b, V.T.C.S.) of this bill. ANALYSIS House Bill 576 amends the Medical Practice Act to require the Texas State Board of Medical Examiners (board) to appoint an advisory committee (committee) to advise the board in developing rules and regulations to administer physician and provider credentialing provisions. The bill authorizes the board in consultation with the committee, to enter into a memorandum of understanding with the appropriate state agency or agencies to develop the standardized credentials verification program (program) and, at its discretion, to seek assistance from outside agencies for the development of the program. The bill requires the board, in consultation with the committee, to retain all policymaking authority over the program and to adopt rules to implement the program. (Sec. 7.02) The bill sets forth provisions regarding the composition and administration of the committee (Secs. 7.02 and 7.03). The bill further requires the board, in consultation with the committee, to enter into a memorandum of understanding with the General Services Commission (GSC) to develop standardized guidelines for procurement and maintenance of all contracts with Designated Credentials Verification Organizations (DCVO). The bill requires the board, in consultation with the committee, to contract with one regionally based accredited credentials verification organization (Secs. 7.02 and 7.08). The bill requires the board, in consultation with the committee, to develop standardized forms for initial credentialing and recredentialing (forms) and to consider the design and format of forms used by a health care entity. The bill requires the board also to consider applicable standards or guidelines from the National Committee for Quality Assurance (NCQA) in developing forms. Furthermore, the bill requires the board, in consultation with the committee, to oversee DCVOs and the administration of the program (Sec. 7.02). The bill requires GSC to assist the board and the committee with the administrative oversight of the DCVO contract (Secs. 7.02 and 7.08). The bill requires each physician and provider required to be credentialed by a health care entity for purposes of serving on a health care entity's physician or provider network or for purposes of obtaining and maintaining hospital privileges to report all core credentials data to the DCVO by completing a standardized application and to notify the DCVO within 45 business days of any changes in core credentials data. (Sec. 7.02). The bill sets forth what information constitutes core credentials data and authorizes the board by rule to add elements as necessary (Sec. 7.01). The bill sets forth the qualifications and duties of the DCVO. The bill requires the DCVO to provide the physician's or provider's core data, including all corrections, updates, and modifications only to the health care entity authorized by the physician to collect such data (Secs. 7.02 and 7.07). The bill requires a health care entity to be prohibited from transferring a physician's or provider's data to a health care entity's affiliate company or any other company associated with the health care entity unless the physician or provider specifically authorizes its release (Sec. 7.07). H.B. 576 provides that it is the intent of legislature that the board and the committee maximize the use of private resources in administering the credentialing verification system. The bill requires the board to contract with one regionally based accredited credentials verification organization. The bill authorizes the board, in consultation with the committee, to establish more than one but no more than four regions within Texas and provides that the board, in consultation with the committee, procure and select one contractor per region (Sec. 7.08) In consultation with the committee, the bill authorizes the board to charge DCVOs a reasonable registration fee and renewal registration fee not to exceed an amount sufficient to cover the board's actual expenses in providing and enforcing such registration, and requires the board to establish by rule for biennial renewal of registration. If a DCVO fails to maintain full accreditation or certification, provide data as authorized by the physician or provider, or comply with the prohibition against collection of duplicate data from a provider or physician, the bill authorizes the board, in consultation with the committee, to deny an application for renewal, to revoke, to suspend registration, or to terminate the contract. (Sec. 7.08) If the board determines that a DCVO is insolvent, fails to meet its contractual obligations or fails to meet certain standards, the bill authorizes the board, in consultation with the committee, to terminate the contract and reassign the DCVOs duties and responsibilities to another DCVO selected by the board and the committee. The bill requires GSC to assist the board and the committee with the reassignment of a contract and provides that any information transferred to the board and the committee for reassignment is subject to confidentiality provisions. In compliance with all applicable federal and state laws or regulations, the bill requires the board, in consultation with the committee and with assistance from GSC, to procure its contact with the DCVOs through a competitive procurement process. (Sec. 7.08) The bill provides that a health care entity must use the DCVO to obtain core credentials data. The bill authorizes the health care entity to use another accredited or certified credentials verification organization to obtain additional verified data it may require to meet its credentialing or clinical privileging requirements or may obtain such data using its own resources. This provision does not restrict or modify the authority of a health care entity to approve or deny an application for hospital staff membership, clinical privileges, or managed care network participation pursuant to its own criteria. The bill requires the board, in consultation with the committee, to establish the length of time within which the DCVO must respond to a request for all core credentials data it has collected on a physician or provider including any changes to that data. (Sec. 7.03). H.B. 576 prohibits a health care entity from collecting or attempting to collect duplicate data from a physician or provider for credentialing purposes if the information is already on file with the DCVO. The bill prohibits a state agency from collecting duplicate data from a provider if the information is already on file with the DCVO, rather than the board, and does not restrict the right of a state agency to request additional information not included in the data on file with the DCVO, rather than the board, that the agency considers necessary for its specific credentialing purposes (Sec. 7.05). The bill requires the board, in consultation with the committee, to charge and collect reasonable fees in amounts necessary to cover the cost of operation and administration of the program from a health care entity accessing information from a DCVO. Furthermore, the bill authorizes the board, in consultation with the committee, to waive a fee for a state agency that is required to obtain data from the DCVO (Sec. 7.09). The bill requires the DCVO to provide to affected physicians or providers, before releasing a physician's or provider's data for the first time or following a change in the data from its data bank, 15 business days to review the data and request reconsideration or resolution of errors in or omissions from data, if the data obtained from other sources varies substantially from data provided by the physician or provider to the DCVO. The bill requires the DCVO to include with the data any change or clarification made by the physician or provider and requires the DCVO to notify a physician or provider of any change in the data made or initiated by a person other than the physician or provider. The bill authorizes a physician or provider to request to review the physician's or provider's data collected by the DCVO any time after the initial release of information, but the DCVO is not required by that request to hold, release, or modify information. (Sec. 7.04) H.B. 576 requires the board, in consultation with the committee, to adopt rules to impose sanctions against physicians and providers for failure to meet the performance requirements of the program and the DCVO for failure to meet the collection and performance requirements of the program. (Sec. 7.10). The bill provides that the following are immune from civil liability: a health care entity that credentials a physician or provider based on data furnished by the DCVO and a member, employee, or agent of the board who takes an action or makes a recommendation without malice and in the reasonable belief that the action or recommendation is warranted by the facts known to the person (Sec. 7.06). If a DCVO fails to meet its contractual obligations, the bill requires that all core credentials data, records, and other information collected, maintained, or stored by that DCVO be transferred to the board and be considered privileged and confidential and not subject to discovery, subpoena, or other means of legal compulsion for its release or disclosure. The bill requires the board, in consultation with the committee, to reassign all data, records, and other information collected to a DCVO selected by the board and the committee (Sec. 7.07). H.B. 576 requires the DCVO to report quarterly to the board and the committee all complaints received from physicians, providers, and health care entities, to prescribe information to be provided to a physician, provider, or health care entity when a complaint is made by such a person or health care entity, and to provide reasonable assistance to a person who wishes to file a complaint with the DCVO (Sec. 7.13). The bill supercedes all other statutes and rules set forth under the Texas Health Maintenance Organization Act relating to credentialing, recredentialing, and primary verification (Sec. 7.12). House Bill 576 amends the Insurance Code to prohibit the Texas Department of Insurance (TDI) from requiring site visits for initial credentialing to be performed by clinical personnel and from requiring a health care entity to maintain at all times evidence of current licensure and appropriate certificates including, but not limited to, Medicare certification. The bill requires TDI to require that when a health care entity is conducting site visits, the health care entity will evaluate a site's accessibility, appearance, space, medical or dental record keeping practices, and availability of appointment and confidentiality procedures, but not appropriateness of equipment. The bill prohibits TDI from requiring that site visits in the offices of high volume specialists be performed based on the volume of visits to such offices. The bill prohibits TDI from requiring visits to be performed for recredentialing of any physician or provider. The bill requires TDI to prohibit Health Maintenance Organizations and Preferred Provider Organizations from collecting duplicate data from physicians or providers with whom they contract once the data have been collected from the DCVO (Art. 20A.37). The board, in consultation with the committee, is required to make available the data not later than September 1, 2002. The bill provides that a health care entity is not required to participate in the program until September 1, 2002, at which time the DCVO from which the health care entity will be collecting data from must be fully operational. If the DCVO is not fully operational on such date, the bill does not require the health care entity to collect data from the DCVO until the board, in consultation with the committee, determines that the DCVO is fully operational (SECTION 4). The board is required to implement the Act only if the legislature appropriates money specifically for that purpose. If money is not appropriated by the legislature, the board is authorized to implement the Act using other appropriations, gifts, grants, or donations available for that purpose (SECTION 3). EFFECTIVE DATE September 1, 2001.