H.B. No. 4730
AN ACT
relating to the Martin County Hospital District.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 3, Chapter 674, Acts of the 60th
Legislature, Regular Session, 1967, is amended to read as follows:
Sec. 3. (a) The Board of Hospital Managers consists of six
managers appointed by the Martin County Commissioners Court.
Managers serve staggered two-year terms, with three managers
appointed each year. To be qualified to serve as a manager, a
person must be a Hospital District resident and a registered voter.
An employee of the District may not serve as a manager. [As soon as
the Hospital District is created and authorized at the election
hereinabove provided, the Commissioners Court shall appoint a Board
of Hospital Managers, consisting of six (6) members, three of whom
shall serve for a term of two (2) years and three of whom shall serve
for a term of one (1) year; thereafter, three members shall be
appointed each year to serve for a term of two (2) years.] Failure
of any member of the Board of Hospital Managers to attend three (3)
consecutive regular meetings of the Board shall cause a vacancy in
his office, unless such absence is excused by formal action of the
Board. In the event a vacancy occurs on the Board of Hospital
Managers, the remaining members shall appoint a member to fill such
vacancy for the remainder of the term of office so vacated. The
Board of Hospital Managers shall serve without compensation but may
be reimbursed for their actual and necessary traveling and other
expenses incurred in the performance of their duties as determined
by the Board of Hospital Managers. The duties of the Board of the
Hospital Managers shall be to manage, control and administer the
hospital or hospital system of the Hospital District. The Board of
Hospital Managers shall have the power and authority to sue and be
sued and to promulgate rules and regulations for the operation of
the hospital or hospital system, including the authority to adopt
and amend bylaws governing the proceedings of the Board.
(b) The Board shall appoint a general manager, to be known
as the Administrator of the Hospital District, and who shall
receive such compensation as may be fixed by the Board. The
Administrator shall be subject to removal at any time by the Board.
The Administrator shall, before entering into the discharge of his
duties, execute a bond payable to the District, in the amount of not
less than Ten Thousand Dollars ($10,000.00), conditioned that he
shall well and faithfully perform the duties required of him, and
containing such other conditions as the Board may require. The
Board may pay for the bond with District money. The Administrator
shall perform all duties which may be required of him by the Board,
and shall supervise all of the work and activities of the District,
and have general direction of the affairs of the District, within
such limitations as may be prescribed by the Board. He shall be a
person qualified by training and experience for the position of
Administrator.
(c) The Board of Hospital Managers shall give the authority
to the Administrator to employ such employees of every kind and
character as may be deemed advisable for the efficient operation of
the hospital or hospital system.
(d) The Board of Hospital Managers shall be authorized to
contract with any county for care and treatment of the county's
sick, diseased and injured persons, and with the state and agencies
of the Federal Government for the care and treatment of such persons
for whom the state and such agencies of the Federal Government are
responsible. Further, under the same conditions, the Board of
Hospital Managers may enter into such contracts with the state and
Federal Government as may be necessary to establish or continue a
retirement program for the benefit of its employees.
(e) The Board of Hospital Managers may in addition to
retirement programs authorized by this Act establish such other
retirement program for the benefit of its employees as it deems
necessary and advisable.
(f) A majority of the Board of Hospital Managers present
shall constitute a quorum for the transaction of any business. The
Board shall elect a Chair and Vice Chair from among its members.
The Board shall appoint a Secretary, who need not be a manager.
Each officer of the Board serves a one-year term. The Board shall
fill a vacancy in a Board office for the remainder of the unexpired
term. [From among its members, the Board shall choose a Chairman,
who shall preside; or in his absence a Chairman Pro Tem shall
preside; and the Administrator or any member of the Board may be
appointed Secretary.] The Board shall require the Secretary to
keep suitable records of all proceedings of each meeting of the
Board in accordance with Subchapter B, Chapter 551, Government
Code. [Such records shall be read and signed after each meeting by
the Chairman or the member presiding, and attested by the
Secretary. The Board shall have a seal, on which shall be engraved
the name of the Hospital District; and said seal shall be kept by
the Secretary and used in authentication of all acts of the Board.]
SECTION 2. Chapter 674, Acts of the 60th Legislature,
Regular Session, 1967, is amended by adding Section 3A to read as
follows:
Sec. 3A. (a) The board may employ physicians or other
health care providers as the board considers necessary for the
efficient operation of the district.
(b) The board shall adopt and maintain policies to ensure
that a physician employed under this section exercises independent
medical judgment when providing care to patients at the hospital
operated by the district. The policies adopted under this
subsection must include policies relating to:
(1) credentialing;
(2) quality assurance;
(3) utilization review;
(4) peer review;
(5) medical decision-making; and
(6) due process.
(c) A physician employed by the district under this section
is subject to the same standards and procedures regarding
credentialing, peer review, quality of care, and privileges as a
physician not employed by the district.
(d) The district shall give equal consideration regarding
the issuance of credentials and privileges to physicians employed
by the hospital and physicians not employed by the district.
(e) A physician employed by the district shall retain
independent medical judgment in providing care to patients at the
hospital operated by the district and may not be penalized for
reasonably advocating for patient care.
(f) This section may not be construed as altering, voiding,
or prohibiting any relationship between a hospital and a physician,
including a contract or arrangement with an approved nonprofit
health corporation that is certified under Section 162.001(b),
Occupations Code, and that holds a certificate of authority issued
under Chapter 844, Insurance Code.
(g) A contract to employ a physician pursuant to this
section shall not include a covenant not to compete upon
termination of the contract.
(h) This section may not be construed as authorizing the
board to supervise or control the practice of medicine, as
prohibited by Subtitle B, Title 3, Occupations Code.
SECTION 3. Section 14, Chapter 674, Acts of the 60th
Legislature, Regular Session, 1967, is amended to read as follows:
Sec. 14. (a) The Board of Hospital Managers shall have the
power and authority to issue and sell general obligation [, as the
obligations of such Hospital District,] bonds for the purchase,
construction, acquisition, repair or renovation of buildings and
improvements and equipping same, for hospital purposes and for any
or all of such purposes; provided that a sufficient tax shall be
levied to create an interest and sinking fund to pay the interest
and principal as same matures and that said tax, together with any
other taxes levied for said District, shall not exceed Seventy-five
Cents (75) on the One Hundred Dollars ($100.00) valuation of
taxable property in any one year. Such bonds shall be executed in
the name of the Hospital District and on its behalf by the Chairman
of the Board of Hospital Managers, and countersigned by the
Secretary of the Board, and shall be subject to the same
requirements in the manner of approval thereof by the Attorney
General of the State of Texas and registration thereof by the
Comptroller of Public Accounts of the State of Texas as are by law
provided for such approval and registration of bonds of the county;
and the approval of such bonds by the Attorney General shall have
the same force and effect as is by law given to his approval of bonds
of the county.
(b) The Hospital District may issue general obligation
bonds only if the bonds are authorized by a majority of the voters
of the District voting in an election held for that purpose. The
Board of Hospital Managers, in ordering the election, shall provide
for clerks as in county elections and shall specify the date of the
election, the location of the polling places, the presiding and
alternate election judges for each polling place, the amount of the
bonds to be authorized, and the maximum maturity of the bonds. The
Board shall give notice of the Board election in the manner provided
by Section 1251.003, Government Code. Chapter 41, Election Code,
does not apply to an election held under this section. The Board
shall declare the results of the election [No bonds shall be issued
by such Hospital District (except refunding bonds) until authorized
by a majority vote of the legally qualified property taxpaying
voters residing in such Hospital District voting at an election
called and held in accordance with the provisions of Chapter 1,
Title 22, of the Revised Civil Statutes of the State of Texas
(1925), as amended, relating to county bonds. Such election shall
be called by the Board of Hospital Managers, and such Board shall
designate the places for holding said election and shall name the
persons who shall conduct said election, in the manner provided by
general law. In the event the initial bonds are voted at an
election called by the Commissioners Court at the time of the
election for the creation of the District, such initial election
shall be governed by the provisions of Section 2 hereof].
(c) In the manner hereinabove provided, the bonds of such
Hospital District may, without the necessity of any election
therefor, be issued for the purpose of refunding or paying off any
bonded indebtedness theretofore assumed by the Hospital District
and any bonds theretofore issued by the Hospital District; such
refunding bonds may be sold and the proceeds thereof applied to the
payment of any such outstanding bonds or may be exchanged in whole
or in part for not less than a like amount of said outstanding bonds
and interest matured thereon, but unpaid; provided the average
interest cost per annum on the refunding bonds, computed in
accordance with the recognized standard bond interest cost tables,
shall not exceed the average interest cost per annum so computed
upon the bonds to be discharged out of the proceeds of the refunding
bonds, unless the total interest cost on the refunding bonds,
computed to their respective maturity dates, is less than the total
interest cost so computed on the bonds to be discharged out of such
proceeds. In the foregoing computations, any premium or premiums
required to be paid upon the bonds to be refunded as a condition to
the payment in advance of their stated maturity dates shall be taken
into account as an addition to the net interest cost to the Hospital
District of the refunding bonds.
(d) The Board of Hospital Managers may issue revenue bonds
to purchase, construct, acquire, repair, renovate, or equip
buildings or improvements for hospital purposes, or acquire sites
to be used for hospital purposes. The bonds must be payable from
and secured by a pledge of all or part of the revenue derived from
the operation of the Hospital District's hospitals. The bonds may
be additionally secured by a mortgage or deed of trust lien on all
or part of District property. The bonds must be issued in the
manner and in accordance with the procedures and requirements
prescribed by Sections 264.042, 264.043, 264.046, 264.047,
264.048, and 264.049, Health and Safety Code, for issuance of
revenue bonds by county hospital authorities.
SECTION 4. Chapter 674, Acts of the 60th Legislature,
Regular Session, 1967, is amended by adding Sections 14A and 14B to
read as follows:
Sec. 14A. In addition to the authority to issue general
obligation bonds and revenue bonds under this Act, the Board of
Hospital Managers may provide for the security and payment of
Hospital District bonds from a pledge of a combination of ad valorem
taxes as authorized by Section 14(a) of this Act and revenue and
other sources authorized by Section 14(d) of this Act.
Sec. 14B. The Hospital District may use the proceeds of
bonds issued under this Act to pay:
(1) any expense the Board of Hospital Managers
determines is reasonable and necessary to issue, sell, and deliver
the bonds;
(2) interest payments on the bonds during a period of
acquisition or construction of a project or facility to be provided
through the bonds, not to exceed five years;
(3) costs related to the operation and maintenance of
a project or facility to be provided through the bonds:
(A) during an estimated period of acquisition or
construction, not to exceed five years; and
(B) for one year after the project or facility is
acquired or constructed;
(4) costs related to the financing of the bond funds,
including debt service reserve and contingency funds;
(5) costs related to the bond issuance;
(6) costs related to the acquisition of land or
interests in land for a project or facility to be provided through
the bonds; and
(7) costs of construction of a project or facility to
be provided through the bonds, including the payment of related
professional services and expenses.
SECTION 5. Chapter 674, Acts of the 60th Legislature,
Regular Session, 1967, is amended by adding Section 17A to read as
follows:
Sec. 17A. (a) The Hospital District may be dissolved only
on approval of a majority of the voters of the District voting in an
election held for that purpose.
(b) The Board of Hospital Managers may order an election on
the question of dissolving the Hospital District and disposing of
the District's assets and obligations.
(c) The Board of Hospital Managers shall order an election
if the Board receives a petition requesting an election that is
signed by at least 15 percent of the registered voters in the
Hospital District.
(d) The order calling the election must state:
(1) the nature of the election, including the
proposition to appear on the ballot;
(2) the date of the election;
(3) the hours during which the polls will be open; and
(4) the location of the polling places.
(e) Section 41.001(a), Election Code, does not apply to an
election ordered under this section.
(f) The Board of Hospital Managers shall give notice of an
election under this section by publishing once a week for two
consecutive weeks a substantial copy of the election order in a
newspaper with general circulation in the Hospital District. The
first publication of the notice must appear not later than the 35th
day before the date of the election.
(g) The ballot for an election under this section must be
printed to permit voting for or against the proposition: "The
dissolution of the Martin County Hospital District."
(h) If a majority of the votes in an election under this
section favor dissolution, the Board of Hospital Managers shall
find that the Hospital District is dissolved.
(i) If a majority of the votes in the election do not favor
dissolution, the Board of Hospital Managers shall continue to
administer the Hospital District and another election on the
question of dissolution may not be held before the first
anniversary of the date of the most recent election on the question
of dissolution.
(j) If a majority of the votes in the election held under
this section favor dissolution, the Board of Hospital Managers
shall:
(1) transfer the land, buildings, improvements,
equipment, and other assets that belong to the Hospital District to
Martin County or another governmental entity in Martin County; or
(2) administer the property, assets, and debts until
all money has been disposed of and all Hospital District debts have
been paid or settled.
(k) If the Hospital District makes the transfer under
Subsection (j)(1), the county or entity assumes all debts and
obligations of the District at the time of the transfer, and the
District is dissolved.
(l) If Subsection (j)(1) does not apply and the Board
administers the property, assets, and debts of the Hospital
District under Subsection (j)(2), the District is dissolved when
all money has been disposed of and all District debts have been paid
or settled.
(m) After the Board of Hospital Managers finds that the
Hospital District is dissolved, the Board shall:
(1) determine the debt owed by the District; and
(2) impose on the property included in the District's
tax rolls a tax that is in proportion of the debt to the property
value.
(n) On the payment of all outstanding debts and obligations
of the Hospital District, the Board of Hospital Managers shall
order the Secretary to return to each District taxpayer the
taxpayer's pro rata share of all unused tax money.
(o) A taxpayer may request that the taxpayer's share of
surplus tax money be credited to the taxpayer's county taxes. If a
taxpayer requests the credit, the Board of Hospital Managers shall
direct the Secretary to transmit the money to the county tax
assessor-collector.
(p) After the Hospital District has paid all its debts and
has disposed of all its money and other assets as prescribed by this
section, the Board of Hospital Managers shall file a written report
with the Commissioners Court of Martin County summarizing the
Board's actions in dissolving the District.
(q) Not later than the 10th day after the date the
Commissioners Court of Martin County receives the report and
determines that the requirements of this section have been
fulfilled, the commissioners court shall enter an order dissolving
the Hospital District and releasing the Board of Hospital Managers
from any further duty or obligation.
SECTION 6. The changes in law made by this Act to the
qualifications of and the prohibitions applying to members of the
Board of Hospital Managers of the Martin County Hospital District
do not affect the entitlement of a member serving on the Board
immediately before the effective date of this Act to continue to
carry out the functions of the Board for the remainder of the
member's term. The changes in law apply only to a member appointed
on or after the effective date of this Act. This Act does not
prohibit a person who is a member of the Board on the effective date
of this Act from being reappointed to the Board if the person has
the qualifications required for membership under Section 3, Chapter
674, Acts of the 60th Legislature, Regular Session, 1967, as
amended by this Act.
SECTION 7. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2009.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 4730 was passed by the House on May 5,
2009, by the following vote: Yeas 144, Nays 0, 1 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 4730 on May 29, 2009, by the following vote: Yeas 142, Nays 0,
1 present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 4730 was passed by the Senate, with
amendments, on May 25, 2009, by the following vote: Yeas 31, Nays
0.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor