Texas 2011 - 82nd Regular

Texas House Bill HB2448 Compare Versions

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1	1	82R23192 EAH-D
2	2	By: Harper-Brown, Callegari, Lucio III H.B. No. 2448
3	3	Substitute the following for H.B. No. 2448:
4	4	By: Callegari C.S.H.B. No. 2448
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to the creation of offices of inspectors general at the
10	10	Health and Human Services Commission, Texas Youth Commission, Texas
11	11	Department of Criminal Justice, Texas Department of
12	12	Transportation, and Texas Education Agency; providing penalties.
13	13	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
14	14	SECTION 1. Subtitle B, Title 4, Government Code, is amended
15	15	by adding Chapter 422 to read as follows:
16	16	CHAPTER 422. OFFICES OF INSPECTORS GENERAL
17	17	SUBCHAPTER A. GENERAL PROVISIONS
18	18	Sec. 422.001. SHORT TITLE. This chapter may be cited as the
19	19	Texas Inspector General Act.
20	20	Sec. 422.002. PURPOSE. The purpose of this chapter is to
21	21	establish guidelines for the offices of inspectors general at
22	22	certain state agencies.
23	23	Sec. 422.003. DEFINITIONS. In this chapter:
24	24	(1) "Agency" means a state agency subject to this
25	25	chapter under Section 422.004.
26	26	(2) "Fraud" has the meaning assigned by Section
27	27	531.1011.
28	28	(3) "Inspector general" means the person appointed
29	29	under this chapter to serve as inspector general for an agency.
30	30	(4) "Office" means the office of inspector general for
31	31	an agency.
32	32	(5) "Provider" has the meaning assigned by Section
33	33	531.1011.
34	34	(6) "Review":
35	35	(A) includes an inspection, investigation,
36	36	audit, or similar activity; and
37	37	(B) does not include a criminal or administrative
38	38	investigation conducted by the office established for the Texas
39	39	Department of Criminal Justice.
40	40	(7) "State funds" or "state money" includes federal
41	41	funds or money received and appropriated by the state or for which
42	42	the state has oversight responsibility.
43	43	Sec. 422.004. APPLICABILITY. (a) This chapter applies
44	44	only to the:
45	45	(1) Health and Human Services Commission;
46	46	(2) Texas Youth Commission;
47	47	(3) Texas Department of Transportation;
48	48	(4) Texas Department of Criminal Justice; and
49	49	(5) Texas Education Agency.
50	50	(b) A state agency may not establish an office of inspector
51	51	general without specific legislative authorization.
52	52	Sec. 422.005. REFERENCE IN OTHER LAW. Notwithstanding any
53	53	other provision of law, a reference in law or rule to an agency's
54	54	office of inspector general means the office of inspector general
55	55	established under this chapter for that agency.
56	56	[Sections 422.006-422.050 reserved for expansion]
57	57	SUBCHAPTER B. OFFICE OF INSPECTOR GENERAL
58	58	Sec. 422.051. ESTABLISHMENT OF OFFICE. (a) Each agency
59	59	subject to this chapter shall establish an office of inspector
60	60	general in the agency.
61	61	(b) The office is governed by the inspector general for the
62	62	agency.
63	63	(c) The inspector general shall:
64	64	(1) manage daily operations of the office;
65	65	(2) supervise office staff;
66	66	(3) create office operating procedures, personnel
67	67	policies, and employment policies;
68	68	(4) allocate resources in the office;
69	69	(5) oversee office information resources systems;
70	70	(6) determine the location of office facilities; and
71	71	(7) coordinate office activities with the activities
72	72	of other state agencies, including other health and human services
73	73	agencies.
74	74	(d) The inspector general is responsible for office
75	75	procurement and contracts.
76	76	Sec. 422.052. INDEPENDENCE OF OFFICE. Except as otherwise
77	77	provided by this chapter, the office and inspector general operate
78	78	independently of the agency.
79	79	Sec. 422.053. ADMINISTRATIVE ATTACHMENT. The office is
80	80	administratively attached to the agency. The agency shall provide
81	81	to the office administrative support services.
82	82	Sec. 422.054. SERVICE LEVEL AGREEMENT. (a) The agency and
83	83	the office shall enter into a service level agreement that
84	84	establishes the performance standards and deliverables with regard
85	85	to administrative support by the agency.
86	86	(b) The service level agreement must be reviewed at least
87	87	annually to ensure that services and deliverables are provided in
88	88	accordance with the agreement.
89	89	Sec. 422.055. APPROPRIATIONS AND BUDGET. (a) The
90	90	inspector general shall submit a budget for the office in
91	91	accordance with the reporting requirements of the General
92	92	Appropriations Act.
93	93	(b) The inspector general shall submit to the Legislative
94	94	Budget Board and the agency a legislative appropriations request
95	95	and an operating budget in accordance with the service level
96	96	agreement entered into under Section 422.054 and applicable law.
97	97	(c) If required by or under law, the agency shall submit the
98	98	operating budget to the legislature. The budget is not subject to
99	99	review, alteration, or modification by the agency or the governing
100	100	body or governing officer of the agency before submission to the
101	101	legislature.
102	102	Sec. 422.056. DUTIES OF AGENCY. (a) The agency shall:
103	103	(1) provide administrative assistance to the office;
104	104	and
105	105	(2) coordinate administrative responsibilities with
106	106	the office to avoid unnecessary duplication of duties.
107	107	(b) The agency may not take an action that affects or
108	108	relates to the validity, status, or terms of an interagency
109	109	agreement or a contract to which the office is a party without the
110	110	office's approval.
111	111	[Sections 422.057-422.100 reserved for expansion]
112	112	SUBCHAPTER C. INSPECTOR GENERAL AND PERSONNEL
113	113	Sec. 422.101. APPOINTMENT; STATE OFFICER. (a) The
114	114	governing body or, at an agency that is not governed by a
115	115	multimember governing body, the governor with the advice and
116	116	consent of the senate shall appoint an inspector general to serve as
117	117	director of the office.
118	118	(b) The appointment shall be made without regard to
119	119	political affiliation, race, color, disability, sex, religion,
120	120	age, or national origin.
121	121	(c) In making the appointment, the governing body or the
122	122	governor shall consider the person's integrity, education,
123	123	training, knowledge of law, experience in the enforcement of law,
124	124	executive ability, capability for strong leadership, and
125	125	demonstrated ability in accounting, auditing, financial analysis,
126	126	management analysis, public administration, investigation,
127	127	criminal justice administration, or other closely related fields.
128	128	(d) The inspector general is a state officer.
129	129	Sec. 422.102. TERM. The inspector general serves a
130	130	two-year term that expires on February 1 of each odd-numbered year.
131	131	Sec. 422.103. ELIGIBILITY. (a) To be eligible for
132	132	appointment as inspector general, a person must:
133	133	(1) have unquestioned integrity and moral character;
134	134	(2) hold a bachelor's degree;
135	135	(3) have either:
136	136	(A) at least five years of experience as a
137	137	certified public accountant, certified internal auditor, or
138	138	certified inspector general; or
139	139	(B) a peace officer certification issued by the
140	140	Commission on Law Enforcement Officer Standards and Education that
141	141	the person has held for at least five years; and
142	142	(4) have either:
143	143	(A) at least five years of experience in a
144	144	professional or administrative position that included as a major
145	145	duty fiscal management, the review of fiscal management, or the
146	146	auditing or review of operational efficiency or program
147	147	performance; or
148	148	(B) experience carrying out law enforcement
149	149	duties to prevent fraud, waste, and abuse.
150	150	(b) The person appointed as inspector general must obtain
151	151	certification as a certified inspector general within the time
152	152	required by rules adopted by the governing body or governing
153	153	officer of the agency, as applicable.
154	154	(c) A person formerly employed by an agency as an executive
155	155	or manager may not serve as inspector general for that agency before
156	156	the fifth anniversary of the date of the termination of that
157	157	person's employment by the agency.
158	158	(d) A person is not eligible for appointment as inspector
159	159	general if the person or the person's spouse:
160	160	(1) is an officer or paid consultant of a business
161	161	entity or other organization that holds a license, certificate of
162	162	authority, or other authorization from the agency or that receives
163	163	funds from the agency;
164	164	(2) owns or controls, directly or indirectly, more
165	165	than a 10 percent interest in a business entity or other
166	166	organization receiving funds from the agency; or
167	167	(3) uses or receives a substantial amount of tangible
168	168	goods or funds from the agency, other than compensation or
169	169	reimbursement authorized by law.
170	170	(e) A person is not eligible to serve as inspector general
171	171	if the person or the person's spouse is required to register as a
172	172	lobbyist under Chapter 305 because of the person's or spouse's
173	173	activities for compensation related to the operation of the agency.
174	174	Sec. 422.104. CONFLICT OF INTEREST. (a) The inspector
175	175	general may not serve as an ex officio member on the governing body
176	176	of a governmental entity.
177	177	(b) The inspector general may not have a financial interest
178	178	in the transactions of the office, the agency, or a contractor or
179	179	provider of the agency or office.
180	180	(c) The inspector general and office staff may not
181	181	participate in partisan political activities related to the work of
182	182	the inspector general's office. The inspector general may select
183	183	the most efficient personnel available for each position in the
184	184	inspector general's office. It is against the public policy of this
185	185	state for an officer or employee of this state to recommend a person
186	186	to serve on the staff of the inspector general.
187	187	Sec. 422.105. PEACE OFFICERS. (a) The office may employ
188	188	and commission peace officers to assist the inspector general in
189	189	carrying out the duties of the office relating to detection,
190	190	investigation, and prevention of fraud, waste, and abuse in agency
191	191	programs or in programs receiving state or federal funds that are
192	192	implemented, administered, or overseen by or for a state agency.
193	193	(b) A commissioned peace officer or otherwise designated
194	194	law enforcement officer employed by the office, except for an
195	195	officer employed by the office established for the Texas Department
196	196	of Criminal Justice, is not entitled to supplemental benefits from
197	197	the law enforcement and custodial officer supplemental retirement
198	198	fund unless the officer transfers from a position, without a break
199	199	in service, that qualifies for supplemental retirement benefits
200	200	from the fund.
201	201	Sec. 422.106. EXPERTS. Subject to the availability of
202	202	funds, the inspector general may contract with certified public
203	203	accountants, qualified management consultants, or other
204	204	professional experts as necessary to independently perform the
205	205	functions of the office.
206	206	Sec. 422.107. EMPLOYEES; TRAINING. (a) The inspector
207	207	general may employ personnel as necessary to implement the duties
208	208	of the office.
209	209	(b) The inspector general shall train office personnel to
210	210	pursue, efficiently and as necessary, fraud, waste, and abuse cases
211	211	in state agency programs or other state or federally funded
212	212	programs implemented, administered, or overseen by or for the
213	213	agency.
214	214	(c) The inspector general for the Texas Department of
215	215	Criminal Justice shall train personnel to efficiently and
216	216	effectively perform law enforcement duties.
217	217	Sec. 422.108. ASSISTANCE BY AGENCY EMPLOYEES. (a) The
218	218	inspector general may require employees of a state agency to
219	219	provide assistance to the office in connection with the office's
220	220	duties relating to conducting reviews of fraud, waste, and abuse in
221	221	the provision of services for agency programs or state or federally
222	222	funded programs implemented, administered, or overseen by or for
223	223	the agency.
224	224	(b) The inspector general for the Health and Human Services
225	225	Commission may also require employees of any health and human
226	226	services agency to provide assistance under Subsection (a).
227	227	[Sections 422.109-422.150 reserved for expansion]
228	228	SUBCHAPTER D. GENERAL POWERS AND DUTIES
229	229	Sec. 422.151. GENERAL RESPONSIBILITIES. (a) The office is
230	230	responsible for:
231	231	(1) conducting reviews of fraud, waste, and abuse in
232	232	the provision or funding of services by or for the agency or under a
233	233	program implemented, administered, or overseen by or for the
234	234	agency;
235	235	(2) the enforcement of state law and the protection of
236	236	the public relating to the provision of those services; and
237	237	(3) the prevention and detection of crime relating to
238	238	the provision of those services.
239	239	(b) In addition to the responsibilities under Subsection
240	240	(a), the office established for the Texas Department of Criminal
241	241	Justice is responsible for the investigation of criminal cases and
242	242	administrative violations.
243	243	Sec. 422.152. RULEMAKING BY INSPECTOR GENERAL. (a)
244	244	Notwithstanding Section 531.0055(e) and any other law, the
245	245	inspector general shall adopt the rules necessary to administer the
246	246	functions of the office, including rules to address the imposition
247	247	of sanctions and penalties for violations and due process
248	248	requirements for imposing sanctions and penalties.
249	249	(b) A rule, standard, or form of the agency that is
250	250	necessary to accomplish the duties of the office is considered to
251	251	also be a rule, standard, or form of the office and remains in
252	252	effect as a rule, standard, or form of the office until changed by
253	253	the inspector general.
254	254	(c) The office shall submit proposed rules and adopted rules
255	255	to the agency for publication. The agency shall promptly provide
256	256	for the publication of the proposed or adopted rules in accordance
257	257	with law. The agency, including the governing body or governing
258	258	officer of the agency, may not amend or modify a rule submitted by
259	259	the office.
260	260	(d) The rules must include standards for the office that
261	261	emphasize:
262	262	(1) coordinating reviews and investigative efforts to
263	263	aggressively recover money;
264	264	(2) allocating resources to cases that have the
265	265	strongest supportive evidence and the greatest potential for
266	266	recovery of money; and
267	267	(3) maximizing opportunities for referral of cases to
268	268	the office of attorney general.
269	269	(e) In addition to the standards under Subsection (d), the
270	270	rules of the office established for the Texas Department of
271	271	Criminal Justice must include standards for the office that
272	272	emphasize the investigation of criminal cases and administrative
273	273	violations.
274	274	Sec. 422.153. PUBLIC INTEREST INFORMATION AND COMPLAINTS.
275	275	(a) The office shall develop and implement policies that provide
276	276	the public a reasonable opportunity to appear before the office and
277	277	to speak on any issue under the office's jurisdiction.
278	278	(b) The office shall prepare information of public interest
279	279	describing the functions of the office and the office's procedures
280	280	by which complaints are filed with and resolved by the office. The
281	281	office shall make the information available to the public and
282	282	appropriate state agencies.
283	283	(c) The office shall keep an information file about each
284	284	complaint filed with the office relating to a state agency or entity
285	285	receiving state or federal money and falling under the
286	286	investigatory jurisdiction of the office.
287	287	[Sections 422.154-422.200 reserved for expansion]
288	288	SUBCHAPTER E. REVIEWS, INVESTIGATIONS, AND AUDITS
289	289	Sec. 422.201. REVIEW, INVESTIGATION, AND AUDIT AUTHORITY.
290	290	(a) The inspector general may review any activity or operation of
291	291	the agency, a provider, if applicable, or a person in this state
292	292	that is related to the investigation, detection, or prevention of
293	293	fraud, waste, abuse, or employee misconduct in an agency program or
294	294	state or federally funded program implemented, administered, or
295	295	overseen by or for the agency. A review may include an
296	296	investigation or other inquiry into a specific act or allegation
297	297	of, or a specific financial transaction or practice that may
298	298	involve, impropriety, malfeasance, or nonfeasance in the
299	299	obligation, spending, receipt, or other use of state or federal
300	300	money.
301	301	(b) The office shall conduct reviews to protect the public
302	302	and detect and prevent fraud, waste, and abuse in the provision or
303	303	funding of services or programs.
304	304	(c) The office shall conduct internal affairs
305	305	investigations in instances of suspected fraud, waste, and abuse
306	306	and in instances of suspected misconduct by employees, contractors,
307	307	subcontractors, and vendors.
308	308	(d) The office established for the Texas Department of
309	309	Criminal Justice shall conduct criminal and administrative
310	310	investigations involving suspected misconduct by employees,
311	311	contractors, subcontractors, vendors, and offenders.
312	312	(e) A state agency or the governing body or governing
313	313	officer of a state agency may not impair or prohibit the inspector
314	314	general from initiating or completing a review, or attempt to
315	315	influence the inspector general in conducting a review.
316	316	(f) The inspector general may review the use and
317	317	effectiveness of state or federal funds, including contract and
318	318	grant funds, administered by a person or state agency receiving the
319	319	funds in connection with an agency or state or federally funded
320	320	program implemented, administered, or overseen by or for the
321	321	agency.
322	322	Sec. 422.202. INITIATION OF REVIEW. The inspector general
323	323	may initiate a review:
324	324	(1) on the inspector general's own initiative;
325	325	(2) at the request of the agency or the governing body
326	326	or governing officer of the agency; or
327	327	(3) based on a complaint from any source concerning a
328	328	matter described by Section 422.201.
329	329	Sec. 422.203. ACCESS TO INFORMATION. To further a review
330	330	conducted by the office, the inspector general is entitled to
331	331	access all books, records, accounts, documents, reports, vouchers,
332	332	databases, systems, or other information, including confidential
333	333	information, electronic data, and internal records relevant to the
334	334	functions of the office that are maintained by or for a person,
335	335	state agency, or provider, if applicable, in connection with an
336	336	agency or a state or federally funded program implemented,
337	337	administered, or overseen by or for the agency.
338	338	Sec. 422.204. COOPERATION REQUIRED. To further a review
339	339	conducted by the inspector general's office, the inspector general
340	340	is entitled to full and unrestricted access to all offices, limited
341	341	access or restricted areas, employees, equipment, and computers,
342	342	including areas, equipment, and computers that contain
343	343	confidential information and internal records, relevant to the
344	344	functions of the office that are maintained by or for a person,
345	345	agency, or provider, if applicable, in connection with an agency or
346	346	a state or federally funded program implemented, administered, or
347	347	overseen by or for the agency.
348	348	Sec. 422.205. SUBPOENAS. (a) The inspector general may
349	349	issue a subpoena to compel the attendance of a relevant witness or
350	350	the production, for inspection or copying, of relevant evidence in
351	351	connection with a review conducted under this subchapter.
352	352	(b) A subpoena may be served personally or by certified
353	353	mail.
354	354	(c) If a person fails to comply with a subpoena, the
355	355	inspector general, acting through the attorney general, may file
356	356	suit to enforce the subpoena in a district court in this state.
357	357	(d) On finding that good cause exists for issuing the
358	358	subpoena, the court shall order the person to comply with the
359	359	subpoena. The court may hold in contempt a person who fails to obey
360	360	the court order.
361	361	(e) The reimbursement of the expenses of a witness whose
362	362	attendance is compelled under this section is governed by Section
363	363	2001.103.
364	364	Sec. 422.206. INTERNAL AUDITOR. (a) In this section,
365	365	"internal auditor" means a person appointed under Section 2102.006.
366	366	(b) The internal auditor for the agency shall provide the
367	367	inspector general with a copy of the agency's internal audit plan
368	368	to:
369	369	(1) assist in the coordination of efforts between the
370	370	inspector general and the internal auditor; and
371	371	(2) limit duplication of effort regarding reviews by
372	372	the inspector general and internal auditor.
373	373	(c) The internal auditor shall provide to the inspector
374	374	general all final audit reports concerning audits of any:
375	375	(1) part or division of the agency;
376	376	(2) contract, procurement, or grant; and
377	377	(3) program conducted by the agency.
378	378	Sec. 422.207. COOPERATION WITH LAW ENFORCEMENT OFFICIALS
379	379	AND OTHER ENTITIES. (a) The inspector general may provide
380	380	information and evidence relating to criminal acts to the state
381	381	auditor's office and appropriate law enforcement officials.
382	382	(b) The inspector general may refer matters for further
383	383	civil, criminal, and administrative action to appropriate
384	384	administrative and prosecutorial agencies, including the attorney
385	385	general.
386	386	(c) The inspectors general for the Texas Department of
387	387	Criminal Justice and the Texas Youth Commission shall refer a
388	388	criminal or delinquent conduct case to the appropriate prosecuting
389	389	attorney or the special prosecution unit under Subchapter E,
390	390	Chapter 41.
391	391	(d) The inspector general may enter into a memorandum of
392	392	understanding with a law enforcement or prosecutorial agency,
393	393	including the office of the attorney general, to assist in
394	394	conducting a review under this subchapter.
395	395	Sec. 422.208. COOPERATION AND COORDINATION WITH STATE
396	396	AUDITOR. (a) The state auditor may, on request of the inspector
397	397	general, provide appropriate information or other assistance to the
398	398	inspector general or office, as determined by the state auditor.
399	399	(b) The inspector general may meet with the state auditor's
400	400	office to coordinate a review conducted under this subchapter,
401	401	share information, or schedule work plans.
402	402	(c) The state auditor is entitled to access all information
403	403	maintained by the inspector general, including vouchers,
404	404	electronic data, internal records, and information obtained under
405	405	Section 422.203 or subject to Section 422.254.
406	406	(d) Any information obtained or provided by the state
407	407	auditor under this section is confidential and not subject to
408	408	disclosure under Chapter 552.
409	409	Sec. 422.209. AUTHORITY OF STATE AUDITOR AND SUNSET
410	410	ADVISORY COMMISSION NOT IMPAIRED. (a) This chapter or other law
411	411	related to the operation of an inspector general does not take
412	412	precedence over the authority of the state auditor to conduct an
413	413	audit under Chapter 321 or other law.
414	414	(b) This chapter or other law related to the operation of an
415	415	inspector general does not take precedence over the authority of
416	416	the Sunset Advisory Commission or other legislative bodies to
417	417	review an agency under other law.
418	418	Sec. 422.210. PREVENTION. (a) The inspector general may
419	419	recommend to the agency policies on:
420	420	(1) promoting economical and efficient administration
421	421	of state or federal funds administered by an individual or entity
422	422	that received the funds from a state agency; and
423	423	(2) preventing and detecting fraud, waste, and abuse
424	424	in the administration of those funds.
425	425	(b) The inspector general may provide training or other
426	426	education regarding the prevention of fraud, waste, or abuse to
427	427	employees of a state agency. The training or education provided
428	428	must be approved by the agency director.
429	429	[Sections 422.211-422.250 reserved for expansion]
430	430	SUBCHAPTER F. REPORTS
431	431	Sec. 422.251. PERIODIC REPORTING TO STATE AUDITOR AND
432	432	AGENCY REQUIRED. The inspector general shall timely inform the
433	433	state auditor and the agency director of the initiation of a review
434	434	of an agency program and the ongoing status of each review.
435	435	Sec. 422.252. REPORTING OFFICE FINDINGS. The inspector
436	436	general shall report the findings of the office for any review
437	437	conducted under Subchapter E to:
438	438	(1) the governing body or governing officer of the
439	439	agency, as applicable;
440	440	(2) the governor;
441	441	(3) the lieutenant governor;
442	442	(4) the speaker of the house of representatives;
443	443	(5) the state auditor's office; and
444	444	(6) appropriate law enforcement and prosecutorial
445	445	agencies, including the office of the attorney general, if the
446	446	findings suggest the probability of criminal conduct.
447	447	Sec. 422.253. FLAGRANT VIOLATIONS; IMMEDIATE REPORT. The
448	448	inspector general shall immediately report to the governing body or
449	449	governing officer of the agency, as applicable, the governor's
450	450	general counsel, and the state auditor a problem that the inspector
451	451	general determines is particularly serious or flagrant and that
452	452	relates to the administration of a program, operation of a state
453	453	agency, or interference with an inspector general review.
454	454	Sec. 422.254. INFORMATION CONFIDENTIAL. (a) Except as
455	455	provided by this section and Sections 422.251, 422.252, 422.255,
456	456	422.256, 531.103, and 531.1031, all information and material
457	457	compiled or maintained by the inspector general during a review
458	458	under this chapter is:
459	459	(1) confidential and not subject to disclosure under
460	460	Chapter 552; and
461	461	(2) not subject to disclosure, discovery, subpoena, or
462	462	other means of legal compulsion for release to anyone other than the
463	463	state auditor's office, the agency, or the office or its agents
464	464	involved in the review related to that information or material.
465	465	(b) As the inspector general determines appropriate based
466	466	on evidence sufficient to support an allegation, information
467	467	relating to a review may be disclosed to:
468	468	(1) a law enforcement agency;
469	469	(2) a district or county attorney with jurisdiction;
470	470	(3) the attorney general's office;
471	471	(4) the state auditor's office; or
472	472	(5) the agency.
473	473	(c) A person that receives information under Subsection (b)
474	474	may not disclose the information except to the extent that
475	475	disclosure is consistent with the authorized purpose for which the
476	476	person first obtained the information.
477	477	Sec. 422.255. DRAFT OF FINAL REVIEW REPORT; AGENCY
478	478	RESPONSE. (a) Except in cases in which the office has determined
479	479	that fraud, waste, or abuse exists, the office shall provide a draft
480	480	of the final review report of any review of the operations of a
481	481	state agency to the state agency director before publishing the
482	482	office's final review report.
483	483	(b) The state agency director may provide a response to the
484	484	office's draft report in the manner prescribed by the office not
485	485	later than the 10th day after the date the draft report is received
486	486	by the state agency director. The inspector general by rule shall
487	487	specify the format and requirements of the agency response.
488	488	(c) Notwithstanding Subsection (a), the office may not
489	489	provide a draft report to the state agency director if in the
490	490	inspector general's opinion providing the draft report could
491	491	negatively affect any anticipated civil or criminal proceedings.
492	492	(d) The office may include any portion of the state agency's
493	493	response in the office's final report.
494	494	Sec. 422.256. FINAL REVIEW REPORTS; AGENCY RESPONSE. (a)
495	495	The inspector general shall prepare a final report for each review
496	496	conducted under this chapter. The final report must include:
497	497	(1) a summary of the activities performed by the
498	498	inspector general in conducting the review;
499	499	(2) a determination of whether wrongdoing or
500	500	substantial waste was found; and
501	501	(3) a description of any findings of wrongdoing or
502	502	substantial waste or, if no wrongdoing or substantial waste was
503	503	found, a statement indicating that finding.
504	504	(b) The inspector general's final review reports are
505	505	subject to disclosure under Chapter 552.
506	506	(c) All working papers and other documents related to
507	507	compiling the final review reports remain confidential and are not
508	508	subject to disclosure under Chapter 552.
509	509	(d) Not later than the 60th day after the date the office
510	510	issues a final report that identifies deficiencies or
511	511	inefficiencies in, or recommends corrective measures in the
512	512	operations of, a state agency, the state agency shall file a
513	513	response that includes:
514	514	(1) an implementation plan and timeline for
515	515	implementing corrective measures; or
516	516	(2) the state agency's rationale for declining to
517	517	implement corrective measures for the identified deficiencies or
518	518	inefficiencies or the office's recommended corrective measures, as
519	519	applicable.
520	520	(e) Unless otherwise prohibited by this chapter or other
521	521	law, the inspector general shall deliver a copy of each final report
522	522	to:
523	523	(1) the agency director of the subject state agency;
524	524	(2) the governing body or governing officer of the
525	525	state agency;
526	526	(3) any appropriate advisory council;
527	527	(4) the governor;
528	528	(5) the lieutenant governor;
529	529	(6) the speaker of the house of representatives;
530	530	(7) any appropriate law enforcement and prosecutorial
531	531	agencies;
532	532	(8) the state auditor; and
533	533	(9) any appropriate licensing or certification
534	534	agencies.
535	535	Sec. 422.257. COSTS. (a) The inspector general shall
536	536	maintain information regarding the cost of reviews.
537	537	(b) The inspector general may cooperate with appropriate
538	538	administrative and prosecutorial agencies, including the office of
539	539	the attorney general, in recovering costs incurred under this
540	540	chapter from nongovernmental entities, including contractors or
541	541	individuals involved in:
542	542	(1) violations of applicable state or federal rules or
543	543	statutes;
544	544	(2) abusive or wilful misconduct; or
545	545	(3) violations of a provider contract or program
546	546	policy.
547	547	(c) In a criminal prosecution to which this chapter applies,
548	548	the attorney representing the state shall request that the court
549	549	require restitution as a condition of a convicted person's
550	550	community supervision or parole.
551	551	[Sections 422.258-422.300 reserved for expansion]
552	552	SUBCHAPTER G. PENALTIES
553	553	Sec. 422.301. ADMINISTRATIVE OR CIVIL PENALTY; INJUNCTION.
554	554	(a) The office may:
555	555	(1) act for a state agency in the assessment by the
556	556	office of administrative or civil penalties the agency is
557	557	authorized to assess under applicable law; and
558	558	(2) request that the attorney general obtain an
559	559	injunction to prevent a person from disposing of an asset
560	560	identified by the office as potentially subject to recovery by the
561	561	office due to the person's fraud, waste, or abuse.
562	562	(b) If the office imposes an administrative or civil penalty
563	563	under Subsection (a) for an agency:
564	564	(1) the agency may not impose an administrative or
565	565	civil penalty against the same person for the same violation; and
566	566	(2) the office shall impose the penalty under
567	567	applicable rules of the office, this chapter, applicable laws
568	568	governing the imposition of a penalty by the agency, and any other
569	569	applicable law.
570	570	SECTION 2. Section 493.019, Government Code, is amended to
571	571	read as follows:
572	572	Sec. 493.019. ENFORCEMENT OFFICERS. In accordance with
573	573	Section 422.105, the [The] inspector general appointed under
574	574	Chapter 422 may appoint employees who are certified by the
575	575	Commission on Law Enforcement Officer Standards and Education as
576	576	qualified to be peace officers to serve under the direction of the
577	577	inspector general and assist the inspector general in performing
578	578	the enforcement duties of the department.
579	579	SECTION 3. Section 493.028(b), Government Code, is amended
580	580	to read as follows:
581	581	(b) The inspector general of the department appointed under
582	582	Chapter 422 shall on a quarterly basis prepare and deliver to the
583	583	board of directors of the special prosecution unit a report
584	584	concerning any alleged criminal offense concerning the department
585	585	and described by Article 104.003(a), Code of Criminal Procedure,
586	586	that occurred during the preceding calendar quarter.
587	587	SECTION 4. Section 501.174, Government Code, is amended to
588	588	read as follows:
589	589	Sec. 501.174. DEPARTMENT TO ADOPT POLICY. The department
590	590	shall adopt a policy providing for:
591	591	(1) a designated administrator at each correctional
592	592	facility to post information throughout the facility describing how
593	593	an inmate may confidentially contact the ombudsperson regarding a
594	594	sexual assault;
595	595	(2) an inmate to write a confidential letter to the
596	596	ombudsperson regarding a sexual assault;
597	597	(3) employees at correctional facilities, on
598	598	notification of the occurrence of a sexual assault, to immediately:
599	599	(A) contact the ombudsperson and the office of
600	600	the inspector general; and
601	601	(B) ensure that the alleged victim is safe;
602	602	(4) the office of the inspector general established
603	603	under Chapter 422, at the time the office is notified of the sexual
604	604	assault, to arrange for a medical examination of the alleged victim
605	605	to be conducted in accordance with Article 56.06, Code of Criminal
606	606	Procedure, or, if an appropriate employee of the office of the
607	607	inspector general is not available at the time the office is
608	608	notified of the sexual assault, a qualified employee at the
609	609	correctional facility to conduct a medical examination of the
610	610	alleged victim in accordance with Article 56.06, Code of Criminal
611	611	Procedure;
612	612	(5) a grievance proceeding under Section 501.008 based
613	613	on an alleged sexual assault to be exempt from any deadline
614	614	applicable to grievances initiated under that section; and
615	615	(6) each correctional facility to collect statistics
616	616	on all alleged sexual assaults against inmates confined in the
617	617	facility and to report the statistics to the ombudsperson.
618	618	SECTION 5. Section 501.176(b), Government Code, is amended
619	619	to read as follows:
620	620	(b) The report must include public information regarding:
621	621	(1) each investigation and monitoring activity
622	622	relating to sexual assault completed during the fiscal year by the
623	623	ombudsperson and the inspector general appointed under Chapter 422;
624	624	and
625	625	(2) statistics collected by the ombudsperson
626	626	regarding allegations of sexual assault.
627	627	SECTION 6. Section 501.177, Government Code, is amended to
628	628	read as follows:
629	629	Sec. 501.177. STATE AUDITOR AUDITS, INVESTIGATIONS, AND
630	630	ACCESS TO INFORMATION NOT IMPAIRED. This subchapter or other law
631	631	related to the operation of the ombudsperson or related to the
632	632	office of the inspector general established under Chapter 422 does
633	633	not prohibit the state auditor from conducting an audit,
634	634	investigation, or other review or from having full and complete
635	635	access to all records and other information, including witnesses
636	636	and electronic data, that the state auditor considers necessary for
637	637	the audit, investigation, or other review.
638	638	SECTION 7. Section 501.178, Government Code, is amended to
639	639	read as follows:
640	640	Sec. 501.178. AUTHORITY OF STATE AUDITOR TO CONDUCT TIMELY
641	641	AUDITS NOT IMPAIRED. This subchapter or other law related to the
642	642	operation of the ombudsperson or of the office of the inspector
643	643	general established under Chapter 422 does not take precedence over
644	644	the authority of the state auditor to conduct an audit under Chapter
645	645	321 or other law.
646	646	SECTION 8. Section 531.001, Government Code, is amended by
647	647	adding Subdivision (4-a) to read as follows:
648	648	(4-a) "Office of inspector general" means the office
649	649	of inspector general established under Chapter 422 for the
650	650	commission.
651	651	SECTION 9. Section 531.008(c), Government Code, is amended
652	652	to read as follows:
653	653	(c) The executive commissioner shall establish the
654	654	following divisions and offices within the commission:
655	655	(1) the eligibility services division to make
656	656	eligibility determinations for services provided through the
657	657	commission or a health and human services agency related to:
658	658	(A) the child health plan program;
659	659	(B) the financial assistance program under
660	660	Chapter 31, Human Resources Code;
661	661	(C) the medical assistance program under Chapter
662	662	32, Human Resources Code;
663	663	(D) the nutritional assistance programs under
664	664	Chapter 33, Human Resources Code;
665	665	(E) long-term care services, as defined by
666	666	Section 22.0011, Human Resources Code;
667	667	(F) community-based support services identified
668	668	or provided in accordance with Section 531.02481; and
669	669	(G) other health and human services programs, as
670	670	appropriate;
671	671	(2) [the office of inspector general to perform fraud
672	672	and abuse investigation and enforcement functions as provided by
673	673	Subchapter C and other law;
674	674	[(3)] the office of the ombudsman to:
675	675	(A) provide dispute resolution services for the
676	676	commission and the health and human services agencies; and
677	677	(B) perform consumer protection functions
678	678	related to health and human services;
679	679	(3) [(4)] a purchasing division as provided by Section
680	680	531.017; and
681	681	(4) [(5)] an internal audit division to conduct a
682	682	program of internal auditing in accordance with [Government Code,]
683	683	Chapter 2102.
684	684	SECTION 10. Sections 531.101(a) and (b), Government Code,
685	685	are amended to read as follows:
686	686	(a) The office of inspector general [commission] may grant
687	687	an award to an individual who reports activity that constitutes
688	688	fraud or abuse of funds in the state Medicaid program or reports
689	689	overcharges in the program if the office [commission] determines
690	690	that the disclosure results in the recovery of an administrative
691	691	penalty imposed under Section 32.039, Human Resources Code. The
692	692	office [commission] may not grant an award to an individual in
693	693	connection with a report if the office [commission] or attorney
694	694	general had independent knowledge of the activity reported by the
695	695	individual.
696	696	(b) The office of inspector general [commission] shall
697	697	determine the amount of an award. The award may not exceed five
698	698	percent of the amount of the administrative penalty imposed under
699	699	Section 32.039, Human Resources Code, that resulted from the
700	700	individual's disclosure. In determining the amount of the award,
701	701	the office [commission] shall consider how important the disclosure
702	702	is in ensuring the fiscal integrity of the program. The office
703	703	[commission] may also consider whether the individual participated
704	704	in the fraud, abuse, or overcharge.
705	705	SECTION 11. Section 531.102, Government Code, is amended to
706	706	read as follows:
707	707	Sec. 531.102. OFFICE OF INSPECTOR GENERAL: CLAIMS CRITERIA
708	708	FOR INVESTIGATION; REFERRAL TO FRAUD CONTROL UNIT; HOLD ON PAYMENT.
709	709	(a) [The commission, through the commission's office of inspector
710	710	general, is responsible for the investigation of fraud and abuse in
711	711	the provision of health and human services and the enforcement of
712	712	state law relating to the provision of those services. The
713	713	commission may obtain any information or technology necessary to
714	714	enable the office to meet its responsibilities under this
715	715	subchapter or other law.
716	716	[(a-1) The governor shall appoint an inspector general to
717	717	serve as director of the office. The inspector general serves a
718	718	one-year term that expires on February 1.
719	719	[(b) The commission, in consultation with the inspector
720	720	general, shall set clear objectives, priorities, and performance
721	721	standards for the office that emphasize:
722	722	[(1) coordinating investigative efforts to
723	723	aggressively recover money;
724	724	[(2) allocating resources to cases that have the
725	725	strongest supportive evidence and the greatest potential for
726	726	recovery of money; and
727	727	[(3) maximizing opportunities for referral of cases to
728	728	the office of the attorney general in accordance with Section
729	729	531.103.
730	730	[(c) The commission shall train office staff to enable the
731	731	staff to pursue priority Medicaid and other health and human
732	732	services fraud and abuse cases as necessary.
733	733	[(d) The commission may require employees of health and
734	734	human services agencies to provide assistance to the office in
735	735	connection with the office's duties relating to the investigation
736	736	of fraud and abuse in the provision of health and human services.
737	737	The office is entitled to access to any information maintained by a
738	738	health and human services agency, including internal records,
739	739	relevant to the functions of the office.
740	740	[(e)] The commission, in consultation with the inspector
741	741	general, by rule shall set specific claims criteria that, when met,
742	742	require the office of inspector general to begin an investigation.
743	743	(b) [(f)(1)] If the office of inspector general
744	744	[commission] receives a complaint of Medicaid fraud or abuse from
745	745	any source, the office must conduct an integrity review to
746	746	determine whether there is sufficient basis to warrant a full
747	747	investigation. An integrity review must begin not later than the
748	748	30th day after the date the office [commission] receives a
749	749	complaint or has reason to believe that fraud or abuse has occurred.
750	750	An integrity review shall be completed not later than the 90th day
751	751	after it began.
752	752	(c) [(2)] If the findings of an integrity review give the
753	753	office of inspector general reason to believe that an incident of
754	754	fraud or abuse involving possible criminal conduct has occurred in
755	755	the Medicaid program, the office must take the following action, as
756	756	appropriate, not later than the 30th day after the completion of the
757	757	integrity review:
758	758	(1) [(A)] if a provider is suspected of fraud or abuse
759	759	involving criminal conduct, the office must refer the case to the
760	760	state's Medicaid fraud control unit, provided that the criminal
761	761	referral does not preclude the office from continuing its
762	762	investigation of the provider, which investigation may lead to the
763	763	imposition of appropriate administrative or civil sanctions; or
764	764	(2) [(B)] if there is reason to believe that a
765	765	recipient has defrauded the Medicaid program, the office may
766	766	conduct a full investigation of the suspected fraud.
767	767	(d) [(g)(1)] Whenever the office of inspector general
768	768	learns or has reason to suspect that a provider's records are being
769	769	withheld, concealed, destroyed, fabricated, or in any way
770	770	falsified, the office shall immediately refer the case to the
771	771	state's Medicaid fraud control unit. However, such criminal
772	772	referral does not preclude the office from continuing its
773	773	investigation of the provider, which investigation may lead to the
774	774	imposition of appropriate administrative or civil sanctions.
775	775	(e) [(2)] In addition to other instances authorized under
776	776	state or federal law, the office of inspector general shall impose
777	777	without prior notice a hold on payment of claims for reimbursement
778	778	submitted by a provider to compel production of records or when
779	779	requested by the state's Medicaid fraud control unit, as
780	780	applicable. The office must notify the provider of the hold on
781	781	payment not later than the fifth working day after the date the
782	782	payment hold is imposed.
783	783	(f) [(3)] On timely written request by a provider subject to
784	784	a hold on payment under Subsection (e) [Subdivision (2)], other
785	785	than a hold requested by the state's Medicaid fraud control unit,
786	786	the office of inspector general shall file a request with the State
787	787	Office of Administrative Hearings or the hearings division of the
788	788	Health and Human Services Commission for an expedited
789	789	administrative hearing regarding the hold. The provider must
790	790	request an expedited hearing under this subsection [subdivision]
791	791	not later than the 10th day after the date the provider receives
792	792	notice from the office under Subsection (e) [Subdivision (2)].
793	793	(g) [(4)] The inspector general [commission] shall adopt
794	794	rules that allow a provider subject to a hold on payment under
795	795	Subsection (e) [Subdivision (2)], other than a hold requested by
796	796	the state's Medicaid fraud control unit, to seek an informal
797	797	resolution of the issues identified by the office of inspector
798	798	general in the notice provided under that subsection [subdivision].
799	799	A provider must seek an informal resolution under this subsection
800	800	[subdivision] not later than the deadline prescribed by Subsection
801	801	(f) [Subdivision (3)]. A provider's decision to seek an informal
802	802	resolution under this subsection [subdivision] does not extend the
803	803	time by which the provider must request an expedited administrative
804	804	hearing under Subsection (f) [Subdivision (3)]. However, a hearing
805	805	initiated under Subsection (f) [Subdivision (3)] shall be stayed at
806	806	the office's request until the informal resolution process is
807	807	completed.
808	808	(h) [(5)] The office of inspector general shall, in
809	809	consultation with the state's Medicaid fraud control unit,
810	810	establish guidelines under which holds on payment, [or] program
811	811	exclusions, administrative actions, or other sanctions:
812	812	(1) [(A)] may permissively be imposed on or taken
813	813	against a provider; or
814	814	(2) [(B)] shall automatically be imposed on or taken
815	815	against a provider.
816	816	(i) [(h)] In addition to performing functions and duties
817	817	otherwise provided by law, the office of inspector general may:
818	818	(1) take administrative action, impose administrative
819	819	sanctions, and assess administrative penalties otherwise
820	820	authorized by law on behalf of the commission or a health and human
821	821	services agency;
822	822	(2) request that the attorney general obtain an
823	823	injunction to prevent a person from disposing of an asset
824	824	identified by the office as potentially subject to recovery by the
825	825	office due to the person's fraud or abuse;
826	826	(3) provide for coordination between the office and
827	827	special investigative units formed by managed care organizations
828	828	under Section 531.113 or entities with which managed care
829	829	organizations contract under that section;
830	830	(4) audit the use and effectiveness of state or
831	831	federal funds, including contract and grant funds, administered by
832	832	a person or state agency receiving the funds from a health and human
833	833	services agency;
834	834	(5) conduct investigations relating to the funds
835	835	described by Subdivision (4); [and]
836	836	(6) recommend policies promoting economical and
837	837	efficient administration of the funds described by Subdivision (4)
838	838	and the prevention and detection of fraud and abuse in
839	839	administration of those funds;
840	840	(7) request the attorney general to represent the
841	841	office of inspector general in a legal proceeding that arises from a
842	842	review conducted by the office and coordinate the activities of the
843	843	office with the office of the attorney general during the legal
844	844	proceeding;
845	845	(8) settle for the commission a case filed in response
846	846	to a review conducted by the office; and
847	847	(9) recover overpayments, assessments, and
848	848	liabilities in a settlement regardless of the origin of the
849	849	overpayment, assessment, or liability.
850	850	(j) [(i)] Notwithstanding any other provision of law, a
851	851	reference in law or rule to the commission's office of
852	852	investigations and enforcement means the office of inspector
853	853	general established under Chapter 422 [this section].
854	854	[(j) The office shall prepare a final report on each audit
855	855	or investigation conducted under this section. The final report
856	856	must include:
857	857	[(1) a summary of the activities performed by the
858	858	office in conducting the audit or investigation;
859	859	[(2) a statement regarding whether the audit or
860	860	investigation resulted in a finding of any wrongdoing; and
861	861	[(3) a description of any findings of wrongdoing.]
862	862	(k) A final report on an audit or investigation is subject
863	863	to required disclosure under Chapter 552. All information and
864	864	materials compiled during the audit or investigation remain
865	865	confidential and not subject to required disclosure [in accordance
866	866	with Section 531.1021(g)].
867	867	SECTION 12. Sections 531.103(a), (c), and (d), Government
868	868	Code, are amended to read as follows:
869	869	(a) The [commission, acting through the commission's]
870	870	office of inspector general[,] and the office of the attorney
871	871	general shall enter into a memorandum of understanding to develop
872	872	and implement joint written procedures for processing cases of
873	873	suspected fraud, waste, or abuse, as those terms are defined by
874	874	state or federal law, or other violations of state or federal law
875	875	under the state Medicaid program or other program administered by
876	876	the commission or a health and human services agency, including the
877	877	financial assistance program under Chapter 31, Human Resources
878	878	Code, a nutritional assistance program under Chapter 33, Human
879	879	Resources Code, and the child health plan program. The memorandum
880	880	of understanding shall require:
881	881	(1) the office of inspector general and the office of
882	882	the attorney general to set priorities and guidelines for referring
883	883	cases to appropriate state agencies for investigation,
884	884	prosecution, or other disposition to enhance deterrence of fraud,
885	885	waste, abuse, or other violations of state or federal law,
886	886	including a violation of Chapter 102, Occupations Code, in the
887	887	programs and maximize the imposition of penalties, the recovery of
888	888	money, and the successful prosecution of cases;
889	889	(1-a) the office of inspector general to refer each
890	890	case of suspected provider fraud, waste, or abuse to the office of
891	891	the attorney general not later than the 20th business day after the
892	892	date the office of inspector general determines that the existence
893	893	of fraud, waste, or abuse is reasonably indicated;
894	894	(1-b) the office of the attorney general to take
895	895	appropriate action in response to each case referred to the
896	896	attorney general, which action may include direct initiation of
897	897	prosecution, with the consent of the appropriate local district or
898	898	county attorney, direct initiation of civil litigation, referral to
899	899	an appropriate United States attorney, a district attorney, or a
900	900	county attorney, or referral to a collections agency for initiation
901	901	of civil litigation or other appropriate action;
902	902	(2) the office of inspector general to keep detailed
903	903	records for cases processed by that office or the office of the
904	904	attorney general, including information on the total number of
905	905	cases processed and, for each case:
906	906	(A) the agency and division to which the case is
907	907	referred for investigation;
908	908	(B) the date on which the case is referred; and
909	909	(C) the nature of the suspected fraud, waste, or
910	910	abuse;
911	911	(3) the office of inspector general to notify each
912	912	appropriate division of the office of the attorney general of each
913	913	case referred by the office of inspector general;
914	914	(4) the office of the attorney general to ensure that
915	915	information relating to each case investigated by that office is
916	916	available to each division of the office with responsibility for
917	917	investigating suspected fraud, waste, or abuse;
918	918	(5) the office of the attorney general to notify the
919	919	office of inspector general of each case the attorney general
920	920	declines to prosecute or prosecutes unsuccessfully;
921	921	(6) representatives of the office of inspector general
922	922	and of the office of the attorney general to meet not less than
923	923	quarterly to share case information and determine the appropriate
924	924	agency and division to investigate each case; and
925	925	(7) the office of inspector general and the office of
926	926	the attorney general to submit information requested by the
927	927	comptroller about each resolved case for the comptroller's use in
928	928	improving fraud detection.
929	929	(c) The office of inspector general [commission] and the
930	930	office of the attorney general shall jointly prepare and submit a
931	931	semiannual report to the governor, lieutenant governor, speaker of
932	932	the house of representatives, and comptroller concerning the
933	933	activities of the office of the attorney general and the office of
934	934	inspector general [those agencies] in detecting and preventing
935	935	fraud, waste, and abuse under the state Medicaid program or other
936	936	program administered by the commission or a health and human
937	937	services agency. The report may be consolidated with any other
938	938	report relating to the same subject matter the office of inspector
939	939	general [commission] or office of the attorney general is required
940	940	to submit under other law.
941	941	(d) The office of inspector general [commission] and the
942	942	office of the attorney general may not assess or collect
943	943	investigation and attorney's fees on behalf of any state agency
944	944	unless the office of inspector general, the office of the attorney
945	945	general, or another [other] state agency collects a penalty,
946	946	restitution, or other reimbursement payment to the state.
947	947	SECTION 13. Section 531.1031(a)(2), Government Code, is
948	948	amended to read as follows:
949	949	(2) "Participating agency" means:
950	950	(A) the Medicaid fraud enforcement divisions of
951	951	the office of the attorney general; [and]
952	952	(B) each board or agency with authority to
953	953	license, register, regulate, or certify a health care professional
954	954	or managed care organization that may participate in the state
955	955	Medicaid program; and
956	956	(C) the office of inspector general.
957	957	SECTION 14. Section 531.104(a), Government Code, is amended
958	958	to read as follows:
959	959	(a) The office of inspector general [commission] and the
960	960	attorney general shall execute a memorandum of understanding under
961	961	which the office [commission] shall provide investigative support
962	962	as required to the attorney general in connection with cases under
963	963	Subchapter B, Chapter 36, Human Resources Code. Under the
964	964	memorandum of understanding, the office [commission] shall assist
965	965	in performing preliminary investigations and ongoing
966	966	investigations for actions prosecuted by the attorney general under
967	967	Subchapter C, Chapter 36, Human Resources Code.
968	968	SECTION 15. Section 531.105, Government Code, is amended to
969	969	read as follows:
970	970	Sec. 531.105. FRAUD DETECTION TRAINING. [(a)] The office
971	971	of inspector general [commission] shall develop and implement a
972	972	program to provide annual training to contractors who process
973	973	Medicaid claims and appropriate staff of the health and human
974	974	services agencies [Texas Department of Health and the Texas
975	975	Department of Human Services] in identifying potential cases of
976	976	fraud, waste, or abuse under the state Medicaid program. The
977	977	training provided to the contractors and staff must include clear
978	978	criteria that specify:
979	979	(1) the circumstances under which a person should
980	980	refer a potential case to the office [commission]; and
981	981	(2) the time by which a referral should be made.
982	982	[(b) The Texas Department of Health and the Texas Department
983	983	of Human Services, in cooperation with the commission, shall
984	984	periodically set a goal of the number of potential cases of fraud,
985	985	waste, or abuse under the state Medicaid program that each agency
986	986	will attempt to identify and refer to the commission. The
987	987	commission shall include information on the agencies' goals and the
988	988	success of each agency in meeting the agency's goal in the report
989	989	required by Section 531.103(c).]
990	990	SECTION 16. Sections 531.106(a), (b), (d), (e), (f), and
991	991	(g), Government Code, are amended to read as follows:
992	992	(a) The office of inspector general [commission] shall use
993	993	learning or neural network technology to identify and deter fraud,
994	994	waste, and abuse in the Medicaid program throughout this state.
995	995	(b) The office of inspector general [commission] shall
996	996	contract with a private or public entity to develop and implement
997	997	the technology. The office [commission] may require the entity it
998	998	contracts with to install and operate the technology at locations
999	999	specified by the office [commission, including commission
1000	1000	offices].
1001	1001	(d) The office of inspector general [commission] shall
1002	1002	require each health and human services agency that performs any
1003	1003	aspect of the state Medicaid program to participate in the
1004	1004	implementation and use of the technology.
1005	1005	(e) The office of inspector general [commission] shall
1006	1006	maintain all information necessary to apply the technology to
1007	1007	claims data covering a period of at least two years.
1008	1008	(f) Cases [The commission shall refer cases] identified by
1009	1009	the technology shall be referred to the [commission's] office of
1010	1010	inspector general [investigations and enforcement] or the office of
1011	1011	the attorney general, as appropriate.
1012	1012	(g) Each month, the learning or neural network technology
1013	1013	implemented under this section must match bureau of vital
1014	1014	statistics death records with Medicaid claims filed by a provider.
1015	1015	If the commission or the office of inspector general determines
1016	1016	that a provider has filed a claim for services provided to a person
1017	1017	after the person's date of death, as determined by the bureau of
1018	1018	vital statistics death records, [the commission shall refer] the
1019	1019	case shall be referred for investigation to the office of inspector
1020	1020	general or the office of the attorney general, as appropriate [to
1021	1021	the commission's office of investigations and enforcement].
1022	1022	SECTION 17. Section 531.1061, Government Code, is amended
1023	1023	to read as follows:
1024	1024	Sec. 531.1061. FRAUD INVESTIGATION TRACKING SYSTEM. (a)
1025	1025	The office of inspector general [commission] shall use an automated
1026	1026	fraud investigation tracking system [through the commission's
1027	1027	office of investigations and enforcement] to monitor the progress
1028	1028	of an investigation of suspected fraud, waste, abuse, or
1029	1029	insufficient quality of care under the state Medicaid program.
1030	1030	(b) For each case of suspected fraud, waste, abuse, or
1031	1031	insufficient quality of care identified by the learning or neural
1032	1032	network technology required under Section 531.106, the automated
1033	1033	fraud investigation tracking system must:
1034	1034	(1) receive electronically transferred records
1035	1035	relating to the identified case from the learning or neural network
1036	1036	technology;
1037	1037	(2) record the details and monitor the status of an
1038	1038	investigation of the identified case, including maintaining a
1039	1039	record of the beginning and completion dates for each phase of the
1040	1040	case investigation;
1041	1041	(3) generate documents and reports related to the
1042	1042	status of the case investigation; and
1043	1043	(4) generate standard letters to a provider regarding
1044	1044	the status or outcome of an investigation.
1045	1045	(c) The office of inspector general may [commission shall]
1046	1046	require each health and human services agency that performs any
1047	1047	aspect of the state Medicaid program to participate in the
1048	1048	implementation and use of the automated fraud investigation
1049	1049	tracking system.
1050	1050	SECTION 18. Section 531.1062(a), Government Code, is
1051	1051	amended to read as follows:
1052	1052	(a) The office of inspector general [commission] shall use
1053	1053	an automated recovery monitoring system to monitor the collections
1054	1054	process for a settled case of fraud, waste, abuse, or insufficient
1055	1055	quality of care under the state Medicaid program.
1056	1056	SECTION 19. Sections 531.107(a), (b), and (f), Government
1057	1057	Code, are amended to read as follows:
1058	1058	(a) The Medicaid and Public Assistance Fraud Oversight Task
1059	1059	Force advises and assists the [commission and the commission's]
1060	1060	office of inspector general [investigations and enforcement] in
1061	1061	improving the efficiency of fraud investigations and collections.
1062	1062	(b) The task force is composed of a representative of the:
1063	1063	(1) attorney general's office, appointed by the
1064	1064	attorney general;
1065	1065	(2) comptroller's office, appointed by the
1066	1066	comptroller;
1067	1067	(3) Department of Public Safety, appointed by the
1068	1068	public safety director;
1069	1069	(4) state auditor's office, appointed by the state
1070	1070	auditor;
1071	1071	(5) office of inspector general [commission],
1072	1072	appointed by the inspector general [commissioner of health and
1073	1073	human services];
1074	1074	(6) [Texas] Department of Aging and Disability [Human]
1075	1075	Services, appointed by the commissioner of aging and disability
1076	1076	[human] services;
1077	1077	(7) Texas Department of Insurance, appointed by the
1078	1078	commissioner of insurance; and
1079	1079	(8) [Texas] Department of State Health Services,
1080	1080	appointed by the commissioner of state [public] health services.
1081	1081	(f) At least once each fiscal quarter, the [commission's]
1082	1082	office of inspector general [investigations and enforcement] shall
1083	1083	provide to the task force:
1084	1084	(1) information detailing:
1085	1085	(A) the number of fraud referrals made to the
1086	1086	office and the origin of each referral;
1087	1087	(B) the time spent investigating each case;
1088	1088	(C) the number of cases investigated each month,
1089	1089	by program and region;
1090	1090	(D) the dollar value of each fraud case that
1091	1091	results in a criminal conviction; and
1092	1092	(E) the number of cases the office rejects and
1093	1093	the reason for rejection, by region; and
1094	1094	(2) any additional information the task force
1095	1095	requires.
1096	1096	SECTION 20. Sections 531.108 and 531.109, Government Code,
1097	1097	are amended to read as follows:
1098	1098	Sec. 531.108. FRAUD PREVENTION. (a) The [commission's]
1099	1099	office of inspector general [investigations and enforcement] shall
1100	1100	compile and disseminate accurate information and statistics
1101	1101	relating to:
1102	1102	(1) fraud prevention; and
1103	1103	(2) post-fraud referrals received and accepted or
1104	1104	rejected from the office's [commission's] case management system or
1105	1105	the case management system of a health and human services agency.
1106	1106	(b) The office of inspector general [commission] shall:
1107	1107	(1) aggressively publicize successful fraud
1108	1108	prosecutions and fraud-prevention programs through all available
1109	1109	means, including the use of statewide press releases [issued in
1110	1110	coordination with the Texas Department of Human Services]; and
1111	1111	(2) ensure that a toll-free hotline for reporting
1112	1112	suspected fraud in programs administered by the office, the
1113	1113	commission, or a health and human services agency is maintained and
1114	1114	promoted[, either] by the office, the commission, or [by] a health
1115	1115	and human services agency.
1116	1116	(c) The office of inspector general [commission] shall
1117	1117	develop a cost-effective method of identifying applicants for
1118	1118	public assistance in counties bordering other states and in
1119	1119	metropolitan areas selected by the office [commission] who are
1120	1120	already receiving benefits in other states. If economically
1121	1121	feasible, the office [commission] may develop a computerized
1122	1122	matching system.
1123	1123	(d) The office of inspector general [commission] shall:
1124	1124	(1) verify automobile information that is used as
1125	1125	criteria for eligibility; and
1126	1126	(2) establish a computerized matching system with the
1127	1127	Texas Department of Criminal Justice to prevent an incarcerated
1128	1128	individual from illegally receiving public assistance benefits
1129	1129	administered by the commission.
1130	1130	(e) The office of inspector general [commission] shall
1131	1131	submit to the governor and Legislative Budget Board a semiannual
1132	1132	report on the results of computerized matching of office and
1133	1133	commission information with information from neighboring states,
1134	1134	if any, and information from the Texas Department of Criminal
1135	1135	Justice. The report may be consolidated with any other report
1136	1136	relating to the same subject matter the office [commission] is
1137	1137	required to submit under other law.
1138	1138	Sec. 531.109. SELECTION AND REVIEW OF CLAIMS. (a) The
1139	1139	office of inspector general [commission] shall annually select and
1140	1140	review a random, statistically valid sample of all claims for
1141	1141	reimbursement under the state Medicaid program, including the
1142	1142	vendor drug program, for potential cases of fraud, waste, or abuse.
1143	1143	(b) In conducting the annual review of claims under
1144	1144	Subsection (a), the office of inspector general [commission] may
1145	1145	directly contact a recipient by telephone or in person, or both, to
1146	1146	verify that the services for which a claim for reimbursement was
1147	1147	submitted by a provider were actually provided to the recipient.
1148	1148	(c) Based on the results of the annual review of claims, the
1149	1149	office of inspector general and the commission shall determine the
1150	1150	types of claims at which office and commission resources for fraud,
1151	1151	waste, and abuse detection should be primarily directed.
1152	1152	SECTION 21. Sections 531.110(a), (c), (d), (e), and (f),
1153	1153	Government Code, are amended to read as follows:
1154	1154	(a) The office of inspector general [commission] shall
1155	1155	conduct electronic data matches for a recipient of assistance under
1156	1156	the state Medicaid program at least quarterly to verify the
1157	1157	identity, income, employment status, and other factors that affect
1158	1158	the eligibility of the recipient.
1159	1159	(c) The commission and other health and human services
1160	1160	agencies [Texas Department of Human Services] shall cooperate with
1161	1161	the office of inspector general [commission] by providing data or
1162	1162	any other assistance necessary to conduct the electronic data
1163	1163	matches required by this section.
1164	1164	(d) The office of inspector general [commission] may
1165	1165	contract with a public or private entity to conduct the electronic
1166	1166	data matches required by this section.
1167	1167	(e) The office of inspector general [commission], or a
1168	1168	health and human services agency designated by the office
1169	1169	[commission], by rule shall establish procedures to verify the
1170	1170	electronic data matches conducted by the office [commission] under
1171	1171	this section. Not later than the 20th day after the date the
1172	1172	electronic data match is verified, the commission and other health
1173	1173	and human services agencies [Texas Department of Human Services]
1174	1174	shall remove from eligibility a recipient who is determined to be
1175	1175	ineligible for assistance under the state Medicaid program.
1176	1176	(f) The office of inspector general [commission] shall
1177	1177	report biennially to the legislature the results of the electronic
1178	1178	data matching program. The report must include a summary of the
1179	1179	number of applicants who were removed from eligibility for
1180	1180	assistance under the state Medicaid program as a result of an
1181	1181	electronic data match conducted under this section.
1182	1182	SECTION 22. Section 531.111, Government Code, is amended to
1183	1183	read as follows:
1184	1184	Sec. 531.111. FRAUD DETECTION TECHNOLOGY. The office of
1185	1185	inspector general [commission] may contract with a contractor who
1186	1186	specializes in developing technology capable of identifying
1187	1187	patterns of fraud exhibited by providers and Medicaid recipients
1188	1188	to:
1189	1189	(1) develop and implement the fraud detection
1190	1190	technology; [and]
1191	1191	(2) determine if a pattern of fraud by Medicaid
1192	1192	recipients is present in the provider's files or recipients'
1193	1193	eligibility files maintained by the commission or other health and
1194	1194	human services agencies; and
1195	1195	(3) identify a person who obtains or receives services
1196	1196	fraudulently, the date on which the person obtained or received the
1197	1197	services, and the location where the services were provided [Texas
1198	1198	Department of Human Services].
1199	1199	SECTION 23. Section 531.1112, Government Code, is amended
1200	1200	to read as follows:
1201	1201	Sec. 531.1112. STUDY CONCERNING INCREASED USE OF TECHNOLOGY
1202	1202	TO STRENGTHEN FRAUD DETECTION AND DETERRENCE; IMPLEMENTATION. (a)
1203	1203	The commission and the [commission's] office of inspector general
1204	1204	shall jointly study the feasibility of increasing the use of
1205	1205	technology to strengthen the detection and deterrence of fraud in
1206	1206	the state Medicaid program. The study must include the
1207	1207	determination of the feasibility of using technology to verify a
1208	1208	person's citizenship and eligibility for coverage.
1209	1209	(b) The commission shall implement any methods the
1210	1210	commission and the [commission's] office of inspector general
1211	1211	determine are effective at strengthening fraud detection and
1212	1212	deterrence.
1213	1213	SECTION 24. Section 531.113, Government Code, is amended to
1214	1214	read as follows:
1215	1215	Sec. 531.113. MANAGED CARE ORGANIZATIONS: SPECIAL
1216	1216	INVESTIGATIVE UNITS OR CONTRACTS. (a) Each managed care
1217	1217	organization that provides or arranges for the provision of health
1218	1218	care services to an individual under a government-funded program,
1219	1219	including the Medicaid program and the child health plan program,
1220	1220	shall:
1221	1221	(1) establish and maintain a special investigative
1222	1222	unit within the managed care organization to investigate fraudulent
1223	1223	claims and other types of program waste or abuse by recipients and
1224	1224	service providers; or
1225	1225	(2) contract with another entity for the investigation
1226	1226	of fraudulent claims and other types of program waste or abuse by
1227	1227	recipients and service providers.
1228	1228	(b) Each managed care organization subject to this section
1229	1229	shall adopt a plan to prevent and reduce fraud, waste, and abuse and
1230	1230	annually file that plan with the [commission's] office of inspector
1231	1231	general for approval. The plan must include:
1232	1232	(1) a description of the managed care organization's
1233	1233	procedures for detecting and investigating possible acts of fraud,
1234	1234	waste, or abuse;
1235	1235	(2) a description of the managed care organization's
1236	1236	procedures for the mandatory reporting of possible acts of fraud,
1237	1237	waste, or abuse to the [commission's] office of inspector general;
1238	1238	(3) a description of the managed care organization's
1239	1239	procedures for educating and training personnel to prevent fraud,
1240	1240	waste, and abuse;
1241	1241	(4) the name, address, telephone number, and fax
1242	1242	number of the individual responsible for carrying out the plan;
1243	1243	(5) a description or chart outlining the
1244	1244	organizational arrangement of the managed care organization's
1245	1245	personnel responsible for investigating and reporting possible
1246	1246	acts of fraud, waste, or abuse;
1247	1247	(6) a detailed description of the results of
1248	1248	investigations of fraud, waste, and abuse conducted by the managed
1249	1249	care organization's special investigative unit or the entity with
1250	1250	which the managed care organization contracts under Subsection
1251	1251	(a)(2); and
1252	1252	(7) provisions for maintaining the confidentiality of
1253	1253	any patient information relevant to an investigation of fraud,
1254	1254	waste, or abuse.
1255	1255	(c) If a managed care organization contracts for the
1256	1256	investigation of fraudulent claims and other types of program waste
1257	1257	or abuse by recipients and service providers under Subsection
1258	1258	(a)(2), the managed care organization shall file with the
1259	1259	[commission's] office of inspector general:
1260	1260	(1) a copy of the written contract;
1261	1261	(2) the names, addresses, telephone numbers, and fax
1262	1262	numbers of the principals of the entity with which the managed care
1263	1263	organization has contracted; and
1264	1264	(3) a description of the qualifications of the
1265	1265	principals of the entity with which the managed care organization
1266	1266	has contracted.
1267	1267	(d) The [commission's] office of inspector general may
1268	1268	review the records of a managed care organization to determine
1269	1269	compliance with this section.
1270	1270	(e) The inspector general [commissioner] shall adopt rules
1271	1271	as necessary to accomplish the purposes of this section.
1272	1272	SECTION 25. Sections 531.114(b) and (g), Government Code,
1273	1273	are amended to read as follows:
1274	1274	(b) If after an investigation the office of inspector
1275	1275	general [commission] determines that a person violated Subsection
1276	1276	(a), the office [commission] shall:
1277	1277	(1) notify the person of the alleged violation not
1278	1278	later than the 30th day after the date the office [commission]
1279	1279	completes the investigation and provide the person with an
1280	1280	opportunity for a hearing on the matter; or
1281	1281	(2) refer the matter to the appropriate prosecuting
1282	1282	attorney for prosecution.
1283	1283	(g) The inspector general [commission] shall adopt rules as
1284	1284	necessary to implement this section.
1285	1285	SECTION 26. Section 531.115, Government Code, is amended to
1286	1286	read as follows:
1287	1287	Sec. 531.115. FEDERAL FELONY MATCH. The office of
1288	1288	inspector general [commission] shall develop and implement a system
1289	1289	to cross-reference data collected for the programs listed under
1290	1290	Section 531.008(c) with the list of fugitive felons maintained by
1291	1291	the federal government.
1292	1292	SECTION 27. Section 533.005(a), Government Code, is amended
1293	1293	to read as follows:
1294	1294	(a) A contract between a managed care organization and the
1295	1295	commission for the organization to provide health care services to
1296	1296	recipients must contain:
1297	1297	(1) procedures to ensure accountability to the state
1298	1298	for the provision of health care services, including procedures for
1299	1299	financial reporting, quality assurance, utilization review, and
1300	1300	assurance of contract and subcontract compliance;
1301	1301	(2) capitation rates that ensure the cost-effective
1302	1302	provision of quality health care;
1303	1303	(3) a requirement that the managed care organization
1304	1304	provide ready access to a person who assists recipients in
1305	1305	resolving issues relating to enrollment, plan administration,
1306	1306	education and training, access to services, and grievance
1307	1307	procedures;
1308	1308	(4) a requirement that the managed care organization
1309	1309	provide ready access to a person who assists providers in resolving
1310	1310	issues relating to payment, plan administration, education and
1311	1311	training, and grievance procedures;
1312	1312	(5) a requirement that the managed care organization
1313	1313	provide information and referral about the availability of
1314	1314	educational, social, and other community services that could
1315	1315	benefit a recipient;
1316	1316	(6) procedures for recipient outreach and education;
1317	1317	(7) a requirement that the managed care organization
1318	1318	make payment to a physician or provider for health care services
1319	1319	rendered to a recipient under a managed care plan not later than the
1320	1320	45th day after the date a claim for payment is received with
1321	1321	documentation reasonably necessary for the managed care
1322	1322	organization to process the claim, or within a period, not to exceed
1323	1323	60 days, specified by a written agreement between the physician or
1324	1324	provider and the managed care organization;
1325	1325	(8) a requirement that the commission, on the date of a
1326	1326	recipient's enrollment in a managed care plan issued by the managed
1327	1327	care organization, inform the organization of the recipient's
1328	1328	Medicaid certification date;
1329	1329	(9) a requirement that the managed care organization
1330	1330	comply with Section 533.006 as a condition of contract retention
1331	1331	and renewal;
1332	1332	(10) a requirement that the managed care organization
1333	1333	provide the information required by Section 533.012 and otherwise
1334	1334	comply and cooperate with the [commission's] office of inspector
1335	1335	general;
1336	1336	(11) a requirement that the managed care
1337	1337	organization's usages of out-of-network providers or groups of
1338	1338	out-of-network providers may not exceed limits for those usages
1339	1339	relating to total inpatient admissions, total outpatient services,
1340	1340	and emergency room admissions determined by the commission;
1341	1341	(12) if the commission finds that a managed care
1342	1342	organization has violated Subdivision (11), a requirement that the
1343	1343	managed care organization reimburse an out-of-network provider for
1344	1344	health care services at a rate that is equal to the allowable rate
1345	1345	for those services, as determined under Sections 32.028 and
1346	1346	32.0281, Human Resources Code;
1347	1347	(13) a requirement that the organization use advanced
1348	1348	practice nurses in addition to physicians as primary care providers
1349	1349	to increase the availability of primary care providers in the
1350	1350	organization's provider network;
1351	1351	(14) a requirement that the managed care organization
1352	1352	reimburse a federally qualified health center or rural health
1353	1353	clinic for health care services provided to a recipient outside of
1354	1354	regular business hours, including on a weekend day or holiday, at a
1355	1355	rate that is equal to the allowable rate for those services as
1356	1356	determined under Section 32.028, Human Resources Code, if the
1357	1357	recipient does not have a referral from the recipient's primary
1358	1358	care physician; [and]
1359	1359	(15) a requirement that the managed care organization
1360	1360	develop, implement, and maintain a system for tracking and
1361	1361	resolving all provider appeals related to claims payment, including
1362	1362	a process that will require:
1363	1363	(A) a tracking mechanism to document the status
1364	1364	and final disposition of each provider's claims payment appeal;
1365	1365	(B) the contracting with physicians who are not
1366	1366	network providers and who are of the same or related specialty as
1367	1367	the appealing physician to resolve claims disputes related to
1368	1368	denial on the basis of medical necessity that remain unresolved
1369	1369	subsequent to a provider appeal; and
1370	1370	(C) the determination of the physician resolving
1371	1371	the dispute to be binding on the managed care organization and
1372	1372	provider; and
1373	1373	(16) a requirement that the managed care organization
1374	1374	refund to the commission, through the office of inspector general,
1375	1375	an overpayment made by the managed care organization to a provider
1376	1376	that is identified as a result of a review conducted under Chapter
1377	1377	422 or Subchapter C, Chapter 531, according to rules adopted by the
1378	1378	inspector general.
1379	1379	SECTION 28. Section 533.012(c), Government Code, is amended
1380	1380	to read as follows:
1381	1381	(c) The [commission's] office of inspector general
1382	1382	[investigations and enforcement] shall review the information
1383	1383	submitted under this section as appropriate in the investigation of
1384	1384	fraud in the Medicaid managed care program.
1385	1385	SECTION 29. Section 811.001(9), Government Code, is amended
1386	1386	to read as follows:
1387	1387	(9) "Law enforcement officer" means a member of the
1388	1388	retirement system who:
1389	1389	(A) has been commissioned as a law enforcement
1390	1390	officer by the Department of Public Safety, the Texas Alcoholic
1391	1391	Beverage Commission, the Parks and Wildlife Department, or the
1392	1392	office of inspector general established under Chapter 422 at the
1393	1393	Texas Youth Commission; and
1394	1394	(B) is recognized as a commissioned law
1395	1395	enforcement officer by the Commission on Law Enforcement Officer
1396	1396	Standards and Education.
1397	1397	SECTION 30. Section 814.104(b), Government Code, is amended
1398	1398	to read as follows:
1399	1399	(b) A member who is at least 55 years old and who has at
1400	1400	least 10 years of service credit as a commissioned peace officer
1401	1401	engaged in criminal law enforcement activities of the Department of
1402	1402	Public Safety, the Texas Alcoholic Beverage Commission, the Parks
1403	1403	and Wildlife Department, or the office of inspector general
1404	1404	established under Chapter 422 at the Texas Youth Commission, or as a
1405	1405	custodial officer, is eligible to retire and receive a service
1406	1406	retirement annuity.
1407	1407	SECTION 31. Section 815.505, Government Code, is amended to
1408	1408	read as follows:
1409	1409	Sec. 815.505. CERTIFICATION OF NAMES OF LAW ENFORCEMENT AND
1410	1410	CUSTODIAL OFFICERS. Not later than the 12th day of the month
1411	1411	following the month in which a person begins or ceases employment as
1412	1412	a law enforcement officer or custodial officer, the Public Safety
1413	1413	Commission, the Texas Alcoholic Beverage Commission, the Parks and
1414	1414	Wildlife Commission, the office of inspector general established
1415	1415	under Chapter 422 at the Texas Youth Commission, the Board of
1416	1416	Pardons and Paroles, or the Texas Board of Criminal Justice, as
1417	1417	applicable, shall certify to the retirement system, in the manner
1418	1418	prescribed by the system, the name of the employee and such other
1419	1419	information as the system determines is necessary for the crediting
1420	1420	of service and financing of benefits under this subtitle.
1421	1421	SECTION 32. Section 2054.376(b), Government Code, is
1422	1422	amended to read as follows:
1423	1423	(b) This subchapter does not apply to:
1424	1424	(1) the Department of Public Safety's use for criminal
1425	1425	justice or homeland security purposes of a federal database or
1426	1426	network;
1427	1427	(2) a Texas equivalent of a database or network
1428	1428	described by Subdivision (1) that is managed by the Department of
1429	1429	Public Safety;
1430	1430	(3) the uniform statewide accounting system, as that
1431	1431	term is used in Subchapter C, Chapter 2101;
1432	1432	(4) the state treasury cash and treasury management
1433	1433	system; [or]
1434	1434	(5) a database or network managed by the comptroller
1435	1435	to:
1436	1436	(A) collect and process multiple types of taxes
1437	1437	imposed by the state; or
1438	1438	(B) manage or administer fiscal, financial,
1439	1439	revenue, and expenditure activities of the state under Chapter 403
1440	1440	and Chapter 404; or
1441	1441	(6) the use of a federal or state database or network
1442	1442	by an office of inspector general established under Chapter 422.
1443	1443	SECTION 33. Section 21.014(b), Human Resources Code, is
1444	1444	amended to read as follows:
1445	1445	(b) The [person employed by the department as] inspector
1446	1446	general appointed under Chapter 422, Government Code, for the
1447	1447	Health and Human Services Commission shall make reports to and
1448	1448	consult with the agency director [chairman of the board] regarding:
1449	1449	(1) the selection of internal audit topics;
1450	1450	(2) the establishment of internal audit priorities;
1451	1451	and
1452	1452	(3) the findings of each regular or special internal
1453	1453	audit initiative.
1454	1454	SECTION 34. Section 32.003, Human Resources Code, is
1455	1455	amended by adding Subdivision (5) to read as follows:
1456	1456	(5) "Office of inspector general" means the office of
1457	1457	inspector general established under Chapter 422, Government Code,
1458	1458	for the Health and Human Services Commission.
1459	1459	SECTION 35. Section 32.0291, Human Resources Code, is
1460	1460	amended to read as follows:
1461	1461	Sec. 32.0291. PREPAYMENT REVIEWS AND POSTPAYMENT HOLDS.
1462	1462	(a) Notwithstanding any other law, the office of inspector general
1463	1463	or department may:
1464	1464	(1) perform a prepayment review of a claim for
1465	1465	reimbursement under the medical assistance program to determine
1466	1466	whether the claim involves fraud, waste, or abuse; and
1467	1467	(2) as necessary to perform that review, withhold
1468	1468	payment of the claim for not more than five working days without
1469	1469	notice to the person submitting the claim.
1470	1470	(b) Notwithstanding any other law, the office of inspector
1471	1471	general [department] may impose a postpayment hold on payment of
1472	1472	future claims submitted by a provider if the office [department]
1473	1473	has reliable evidence that the provider has committed fraud, waste,
1474	1474	abuse, or wilful misrepresentation regarding a claim for
1475	1475	reimbursement under the medical assistance program. The office
1476	1476	[department] must notify the provider of the postpayment hold not
1477	1477	later than the fifth working day after the date the hold is imposed.
1478	1478	(c) On timely written request by a provider subject to a
1479	1479	postpayment hold under Subsection (b), the office of inspector
1480	1480	general [department] shall file a request with the State Office of
1481	1481	Administrative Hearings or the hearings division of the Health and
1482	1482	Human Services Commission for an expedited administrative hearing
1483	1483	regarding the hold. The provider must request an expedited hearing
1484	1484	under this subsection not later than the 10th day after the date the
1485	1485	provider receives notice from the office of inspector general
1486	1486	[department] under Subsection (b). The office of inspector general
1487	1487	[department] shall discontinue the hold unless the office
1488	1488	[department] makes a prima facie showing at the hearing that the
1489	1489	evidence relied on by the office of inspector general [department]
1490	1490	in imposing the hold is relevant, credible, and material to the
1491	1491	issue of fraud, waste, abuse, or wilful misrepresentation.
1492	1492	(d) The inspector general [department] shall adopt rules
1493	1493	that allow a provider subject to a postpayment hold under
1494	1494	Subsection (b) to seek an informal resolution of the issues
1495	1495	identified by the office of inspector general [department] in the
1496	1496	notice provided under that subsection. A provider must seek an
1497	1497	informal resolution under this subsection not later than the
1498	1498	deadline prescribed by Subsection (c). A provider's decision to
1499	1499	seek an informal resolution under this subsection does not extend
1500	1500	the time by which the provider must request an expedited
1501	1501	administrative hearing under Subsection (c). However, a hearing
1502	1502	initiated under Subsection (c) shall be stayed at the office's
1503	1503	[department's] request until the informal resolution process is
1504	1504	completed.
1505	1505	SECTION 36. Section 32.032, Human Resources Code, is
1506	1506	amended to read as follows:
1507	1507	Sec. 32.032. PREVENTION AND DETECTION OF FRAUD, WASTE, AND
1508	1508	ABUSE. The inspector general [department] shall adopt reasonable
1509	1509	rules for minimizing the opportunity for fraud, waste, and abuse,
1510	1510	for establishing and maintaining methods for detecting and
1511	1511	identifying situations in which a question of fraud, waste, or
1512	1512	abuse in the program may exist, and for referring cases where fraud,
1513	1513	waste, or abuse appears to exist to the appropriate law enforcement
1514	1514	agencies for prosecution.
1515	1515	SECTION 37. Sections 32.0321(a) through (d), Human
1516	1516	Resources Code, are amended to read as follows:
1517	1517	(a) The office of inspector general [department] by rule may
1518	1518	recommend to the department and the department by rule may require
1519	1519	that each provider of medical assistance in a provider type that has
1520	1520	demonstrated significant potential for fraud, waste, or abuse to
1521	1521	file with the department a surety bond in a reasonable amount. The
1522	1522	office and the department by rule shall each require a provider of
1523	1523	medical assistance to file with the department a surety bond in a
1524	1524	reasonable amount if the office [department] identifies a pattern
1525	1525	of suspected fraud, waste, or abuse involving criminal conduct
1526	1526	relating to the provider's services under the medical assistance
1527	1527	program that indicates the need for protection against potential
1528	1528	future acts of fraud, waste, or abuse.
1529	1529	(b) The bond under Subsection (a) must be payable to the
1530	1530	department to compensate the department for damages resulting from
1531	1531	or penalties or fines imposed in connection with an act of fraud,
1532	1532	waste, or abuse committed by the provider under the medical
1533	1533	assistance program.
1534	1534	(c) Subject to Subsection (d) or (e), the office of
1535	1535	inspector general and the department by rule may require each
1536	1536	provider of medical assistance that establishes a resident's trust
1537	1537	fund account to post a surety bond to secure the account. The bond
1538	1538	must be payable to the department to compensate residents of the
1539	1539	bonded provider for trust funds that are lost, stolen, or otherwise
1540	1540	unaccounted for if the provider does not repay any deficiency in a
1541	1541	resident's trust fund account to the person legally entitled to
1542	1542	receive the funds.
1543	1543	(d) The office of inspector general and the department may
1544	1544	not require the amount of a surety bond posted for a single facility
1545	1545	provider under Subsection (c) to exceed the average of the total
1546	1546	average monthly balance of all the provider's resident trust fund
1547	1547	accounts for the 12-month period preceding the bond issuance or
1548	1548	renewal date.
1549	1549	SECTION 38. Section 32.0322, Human Resources Code, is
1550	1550	amended to read as follows:
1551	1551	Sec. 32.0322. CRIMINAL HISTORY RECORD INFORMATION. (a)
1552	1552	The office of inspector general and the department may obtain from
1553	1553	any law enforcement or criminal justice agency the criminal history
1554	1554	record information that relates to a provider under the medical
1555	1555	assistance program or a person applying to enroll as a provider
1556	1556	under the medical assistance program.
1557	1557	(b) The office of inspector general [department] by rule
1558	1558	shall establish criteria for revoking a provider's enrollment or
1559	1559	denying a person's application to enroll as a provider under the
1560	1560	medical assistance program based on the results of a criminal
1561	1561	history check.
1562	1562	SECTION 39. Sections 32.033(d) through (h), Human Resources
1563	1563	Code, are amended to read as follows:
1564	1564	(d) A separate and distinct cause of action in favor of the
1565	1565	state is hereby created, and the office of inspector general
1566	1566	[department] may, without written consent, take direct civil action
1567	1567	in any court of competent jurisdiction. A suit brought under this
1568	1568	section need not be ancillary to or dependent upon any other action.
1569	1569	(e) The [department's] right of recovery of the office of
1570	1570	inspector general is limited to the amount of the cost of medical
1571	1571	care services paid by the department. Other subrogation rights
1572	1572	granted under this section are limited to the cost of the services
1573	1573	provided.
1574	1574	(f) The inspector general [commissioner] may waive the
1575	1575	[department's] right of recovery of the office of inspector general
1576	1576	in whole or in part when the inspector general [commissioner] finds
1577	1577	that enforcement would tend to defeat the purpose of public
1578	1578	assistance.
1579	1579	(g) The office of inspector general [department] may
1580	1580	designate an agent to collect funds the office [department] has a
1581	1581	right to recover from third parties under this section. The
1582	1582	department shall use any funds collected under this section to pay
1583	1583	costs of administering the medical assistance program.
1584	1584	(h) The inspector general [department] may adopt rules for
1585	1585	the enforcement of the office's [its] right of recovery.
1586	1586	SECTION 40. Sections 32.039(c) through (r) and (u) through
1587	1587	(x), Human Resources Code, are amended to read as follows:
1588	1588	(c) A person who commits a violation under Subsection (b) is
1589	1589	liable to the department for:
1590	1590	(1) the amount paid, if any, as a result of the
1591	1591	violation and interest on that amount determined at the rate
1592	1592	provided by law for legal judgments and accruing from the date on
1593	1593	which the payment was made; and
1594	1594	(2) payment of an administrative penalty, assessed by
1595	1595	the office of inspector general, in [of] an amount not to exceed
1596	1596	twice the amount paid, if any, as a result of the violation, plus an
1597	1597	amount:
1598	1598	(A) not less than $5,000 or more than $15,000 for
1599	1599	each violation that results in injury to an elderly person, as
1600	1600	defined by Section 48.002(a)(1) [48.002(1)], a disabled person, as
1601	1601	defined by Section 48.002(a)(8)(A) [48.002(8)(A)], or a person
1602	1602	younger than 18 years of age; or
1603	1603	(B) not more than $10,000 for each violation that
1604	1604	does not result in injury to a person described by Paragraph (A).
1605	1605	(d) Unless the provider submitted information to the
1606	1606	department for use in preparing a voucher that the provider knew or
1607	1607	should have known was false or failed to correct information that
1608	1608	the provider knew or should have known was false when provided an
1609	1609	opportunity to do so, this section does not apply to a claim based
1610	1610	on the voucher if the department calculated and printed the amount
1611	1611	of the claim on the voucher and then submitted the voucher to the
1612	1612	provider for the provider's signature. In addition, the provider's
1613	1613	signature on the voucher does not constitute fraud. The inspector
1614	1614	general [department] shall adopt rules that establish a grace
1615	1615	period during which errors contained in a voucher prepared by the
1616	1616	department may be corrected without penalty to the provider.
1617	1617	(e) In determining the amount of the penalty to be assessed
1618	1618	under Subsection (c)(2), the office of inspector general
1619	1619	[department] shall consider:
1620	1620	(1) the seriousness of the violation;
1621	1621	(2) whether the person had previously committed a
1622	1622	violation; and
1623	1623	(3) the amount necessary to deter the person from
1624	1624	committing future violations.
1625	1625	(f) If after an examination of the facts the office of
1626	1626	inspector general [department] concludes that the person committed
1627	1627	a violation, the office [department] may issue a preliminary report
1628	1628	stating the facts on which it based its conclusion, recommending
1629	1629	that an administrative penalty under this section be imposed and
1630	1630	recommending the amount of the proposed penalty.
1631	1631	(g) The office of inspector general [department] shall give
1632	1632	written notice of the report to the person charged with committing
1633	1633	the violation. The notice must include a brief summary of the
1634	1634	facts, a statement of the amount of the recommended penalty, and a
1635	1635	statement of the person's right to an informal review of the alleged
1636	1636	violation, the amount of the penalty, or both the alleged violation
1637	1637	and the amount of the penalty.
1638	1638	(h) Not later than the 10th day after the date on which the
1639	1639	person charged with committing the violation receives the notice,
1640	1640	the person may either give the office of inspector general
1641	1641	[department] written consent to the report, including the
1642	1642	recommended penalty, or make a written request for an informal
1643	1643	review by the office [department].
1644	1644	(i) If the person charged with committing the violation
1645	1645	consents to the penalty recommended by the office of inspector
1646	1646	general [department] or fails to timely request an informal review,
1647	1647	the office [department] shall assess the penalty. The office
1648	1648	[department] shall give the person written notice of its action.
1649	1649	The person shall pay the penalty not later than the 30th day after
1650	1650	the date on which the person receives the notice.
1651	1651	(j) If the person charged with committing the violation
1652	1652	requests an informal review as provided by Subsection (h), the
1653	1653	office of inspector general [department] shall conduct the review.
1654	1654	The office [department] shall give the person written notice of the
1655	1655	results of the review.
1656	1656	(k) Not later than the 10th day after the date on which the
1657	1657	person charged with committing the violation receives the notice
1658	1658	prescribed by Subsection (j), the person may make to the office of
1659	1659	inspector general [department] a written request for a hearing.
1660	1660	The hearing must be conducted in accordance with Chapter 2001,
1661	1661	Government Code.
1662	1662	(l) If, after informal review, a person who has been ordered
1663	1663	to pay a penalty fails to request a formal hearing in a timely
1664	1664	manner, the office of inspector general [department] shall assess
1665	1665	the penalty. The office [department] shall give the person written
1666	1666	notice of its action. The person shall pay the penalty not later
1667	1667	than the 30th day after the date on which the person receives the
1668	1668	notice.
1669	1669	(m) Within 30 days after the date on which the inspector
1670	1670	general's [board's] order issued after a hearing under Subsection
1671	1671	(k) becomes final as provided by Section 2001.144, Government Code,
1672	1672	the person shall:
1673	1673	(1) pay the amount of the penalty;
1674	1674	(2) pay the amount of the penalty and file a petition
1675	1675	for judicial review contesting the occurrence of the violation, the
1676	1676	amount of the penalty, or both the occurrence of the violation and
1677	1677	the amount of the penalty; or
1678	1678	(3) without paying the amount of the penalty, file a
1679	1679	petition for judicial review contesting the occurrence of the
1680	1680	violation, the amount of the penalty, or both the occurrence of the
1681	1681	violation and the amount of the penalty.
1682	1682	(n) A person who acts under Subsection (m)(3) within the
1683	1683	30-day period may:
1684	1684	(1) stay enforcement of the penalty by:
1685	1685	(A) paying the amount of the penalty to the court
1686	1686	for placement in an escrow account; or
1687	1687	(B) giving to the court a supersedeas bond that
1688	1688	is approved by the court for the amount of the penalty and that is
1689	1689	effective until all judicial review of the [department's] order of
1690	1690	the inspector general is final; or
1691	1691	(2) request the court to stay enforcement of the
1692	1692	penalty by:
1693	1693	(A) filing with the court a sworn affidavit of
1694	1694	the person stating that the person is financially unable to pay the
1695	1695	amount of the penalty and is financially unable to give the
1696	1696	supersedeas bond; and
1697	1697	(B) giving a copy of the affidavit to the office
1698	1698	of inspector general [commissioner] by certified mail.
1699	1699	(o) If the office of inspector general [commissioner]
1700	1700	receives a copy of an affidavit under Subsection (n)(2), the office
1701	1701	[commissioner] may file with the court, within five days after the
1702	1702	date the copy is received, a contest to the affidavit. The court
1703	1703	shall hold a hearing on the facts alleged in the affidavit as soon
1704	1704	as practicable and shall stay the enforcement of the penalty on
1705	1705	finding that the alleged facts are true. The person who files an
1706	1706	affidavit has the burden of proving that the person is financially
1707	1707	unable to pay the amount of the penalty and to give a supersedeas
1708	1708	bond.
1709	1709	(p) If the person charged does not pay the amount of the
1710	1710	penalty and the enforcement of the penalty is not stayed, the office
1711	1711	of inspector general [department] may forward the matter to the
1712	1712	attorney general for enforcement of the penalty and interest as
1713	1713	provided by law for legal judgments. An action to enforce a penalty
1714	1714	order under this section must be initiated in a court of competent
1715	1715	jurisdiction in Travis County or in the county in which the
1716	1716	violation was committed.
1717	1717	(q) Judicial review of an [a department] order or review by
1718	1718	the office of inspector general under this section assessing a
1719	1719	penalty is under the substantial evidence rule. A suit may be
1720	1720	initiated by filing a petition with a district court in Travis
1721	1721	County, as provided by Subchapter G, Chapter 2001, Government Code.
1722	1722	(r) If a penalty is reduced or not assessed, the department
1723	1723	shall remit to the person the appropriate amount plus accrued
1724	1724	interest if the penalty has been paid or the office of inspector
1725	1725	general shall execute a release of the bond if a supersedeas bond
1726	1726	has been posted. The accrued interest on amounts remitted by the
1727	1727	department under this subsection shall be paid at a rate equal to
1728	1728	the rate provided by law for legal judgments and shall be paid for
1729	1729	the period beginning on the date the penalty is paid to the
1730	1730	department under this section and ending on the date the penalty is
1731	1731	remitted.
1732	1732	(u) Except as provided by Subsection (w), a person found
1733	1733	liable for a violation under Subsection (c) that resulted in injury
1734	1734	to an elderly person, as defined by Section 48.002(a)(1), a
1735	1735	disabled person, as defined by Section 48.002(a)(8)(A), or a person
1736	1736	younger than 18 years of age may not provide or arrange to provide
1737	1737	health care services under the medical assistance program for a
1738	1738	period of 10 years. The inspector general [department] by rule may
1739	1739	provide for a period of ineligibility longer than 10 years. The
1740	1740	period of ineligibility begins on the date on which the
1741	1741	determination that the person is liable becomes final.
1742	1742	(v) Except as provided by Subsection (w), a person found
1743	1743	liable for a violation under Subsection (c) that did not result in
1744	1744	injury to an elderly person, as defined by Section 48.002(a)(1), a
1745	1745	disabled person, as defined by Section 48.002(a)(8)(A), or a person
1746	1746	younger than 18 years of age may not provide or arrange to provide
1747	1747	health care services under the medical assistance program for a
1748	1748	period of three years. The inspector general [department] by rule
1749	1749	may provide for a period of ineligibility longer than three years.
1750	1750	The period of ineligibility begins on the date on which the
1751	1751	determination that the person is liable becomes final.
1752	1752	(w) The inspector general [department] by rule may
1753	1753	prescribe criteria under which a person described by Subsection (u)
1754	1754	or (v) is not prohibited from providing or arranging to provide
1755	1755	health care services under the medical assistance program. The
1756	1756	criteria may include consideration of:
1757	1757	(1) the person's knowledge of the violation;
1758	1758	(2) the likelihood that education provided to the
1759	1759	person would be sufficient to prevent future violations;
1760	1760	(3) the potential impact on availability of services
1761	1761	in the community served by the person; and
1762	1762	(4) any other reasonable factor identified by the
1763	1763	inspector general [department].
1764	1764	(x) Subsections (b)(1-b) through (1-f) do not prohibit a
1765	1765	person from engaging in:
1766	1766	(1) generally accepted business practices, as
1767	1767	determined by inspector general [department] rule, including:
1768	1768	(A) conducting a marketing campaign;
1769	1769	(B) providing token items of minimal value that
1770	1770	advertise the person's trade name; and
1771	1771	(C) providing complimentary refreshments at an
1772	1772	informational meeting promoting the person's goods or services;
1773	1773	(2) the provision of a value-added service if the
1774	1774	person is a managed care organization; or
1775	1775	(3) other conduct specifically authorized by law,
1776	1776	including conduct authorized by federal safe harbor regulations (42
1777	1777	C.F.R. Section 1001.952).
1778	1778	SECTION 41. Section 32.070(d), Human Resources Code, is
1779	1779	amended to read as follows:
1780	1780	(d) This section does not apply to a computerized audit
1781	1781	conducted using the Medicaid Fraud Detection Audit System or an
1782	1782	audit or investigation of fraud, waste, and abuse conducted by the
1783	1783	Medicaid fraud control unit of the office of the attorney general,
1784	1784	the office of the state auditor, the office of [the] inspector
1785	1785	general, or the Office of Inspector General in the United States
1786	1786	Department of Health and Human Services.
1787	1787	SECTION 42. Section 33.015(e), Human Resources Code, is
1788	1788	amended to read as follows:
1789	1789	(e) The department shall require a person exempted under
1790	1790	this section from making a personal appearance at department
1791	1791	offices to provide verification of the person's entitlement to the
1792	1792	exemption on initial eligibility certification and on each
1793	1793	subsequent periodic eligibility recertification. If the person
1794	1794	does not provide verification and the department considers the
1795	1795	verification necessary to protect the integrity of the food stamp
1796	1796	program, the department shall initiate a fraud referral to the
1797	1797	[department's] office of inspector general established for the
1798	1798	Health and Human Services Commission under Chapter 422, Government
1799	1799	Code.
1800	1800	SECTION 43. Section 61.001(7), Human Resources Code, is
1801	1801	amended to read as follows:
1802	1802	(7) "Office of inspector general" means the office of
1803	1803	inspector general established under Chapter 422, Government Code,
1804	1804	for the commission [Section 61.0451].
1805	1805	SECTION 44. Sections 61.0451(a), (d), (f), and (g), Human
1806	1806	Resources Code, are amended to read as follows:
1807	1807	(a) The office of inspector general shall investigate [is
1808	1808	established at the commission for the purpose of investigating]:
1809	1809	(1) crimes committed by commission employees,
1810	1810	including parole officers employed by or under a contract with the
1811	1811	commission; and
1812	1812	(2) crimes and delinquent conduct committed at a
1813	1813	facility operated by the commission, a residential facility
1814	1814	operated by another entity under a contract with the commission, or
1815	1815	any facility in which a child committed to the custody of the
1816	1816	commission is housed or receives medical or mental health
1817	1817	treatment.
1818	1818	(d) The office of inspector general may employ and
1819	1819	commission inspectors [general] as peace officers in accordance
1820	1820	with Section 422.105, Government Code, for the purpose of carrying
1821	1821	out the duties described by this section. An inspector [general]
1822	1822	shall have all of the powers and duties given to peace officers
1823	1823	under Article 2.13, Code of Criminal Procedure.
1824	1824	(f) If the inspector general is not a commissioned peace
1825	1825	officer, the inspector general [The executive commissioner] shall
1826	1826	select a commissioned peace officer as chief inspector [general].
1827	1827	The chief inspector [general] is subject to the requirements of
1828	1828	this section and may only be discharged for cause.
1829	1829	(g) The [chief] inspector general shall on a quarterly basis
1830	1830	prepare and deliver a report concerning the operations of the
1831	1831	office of inspector general to:
1832	1832	(1) the executive commissioner;
1833	1833	(2) the advisory board;
1834	1834	(3) the governor;
1835	1835	(4) the lieutenant governor;
1836	1836	(5) the speaker of the house of representatives;
1837	1837	(6) the standing committees of the senate and house of
1838	1838	representatives with primary jurisdiction over correctional
1839	1839	facilities;
1840	1840	(7) the state auditor; and
1841	1841	(8) the comptroller.
1842	1842	SECTION 45. Sections 61.098(d) and (e), Human Resources
1843	1843	Code, are amended to read as follows:
1844	1844	(d) Notwithstanding Subsection (c), the office of inspector
1845	1845	general shall immediately provide the special prosecution unit with
1846	1846	a report concerning an alleged criminal offense or delinquent
1847	1847	conduct concerning the commission and described by Article
1848	1848	104.003(a), Code of Criminal Procedure, if the [chief] inspector
1849	1849	general reasonably believes the offense or conduct is particularly
1850	1850	serious and egregious.
1851	1851	(e) The [chief] inspector general of the office of inspector
1852	1852	general, at the direction of the board of directors of the special
1853	1853	prosecution unit, shall notify the foreman of the appropriate grand
1854	1854	jury, in the manner provided by Article 20.09, Code of Criminal
1855	1855	Procedure, if:
1856	1856	(1) the [chief] inspector general receives credible
1857	1857	evidence of illegal or improper conduct by commission officers,
1858	1858	employees, or contractors that the inspector general reasonably
1859	1859	believes jeopardizes the health, safety, and welfare of children in
1860	1860	the custody of the commission;
1861	1861	(2) the [chief] inspector general reasonably believes
1862	1862	the conduct:
1863	1863	(A) could constitute an offense under Article
1864	1864	104.003(a), Code of Criminal Procedure; and
1865	1865	(B) involves the alleged physical or sexual abuse
1866	1866	of a child in the custody of a commission facility or an
1867	1867	investigation related to the alleged abuse; and
1868	1868	(3) the [chief] inspector general has reason to
1869	1869	believe that information concerning the conduct has not previously
1870	1870	been presented to the appropriate grand jury.
1871	1871	SECTION 46. Section 64.055(b), Human Resources Code, is
1872	1872	amended to read as follows:
1873	1873	(b) The independent ombudsman shall immediately report to
1874	1874	the governor, the lieutenant governor, the speaker of the house of
1875	1875	representatives, the state auditor, and the office of the inspector
1876	1876	general established under Chapter 422, Government Code, for [of]
1877	1877	the commission any particularly serious or flagrant:
1878	1878	(1) case of abuse or injury of a child committed to the
1879	1879	commission;
1880	1880	(2) problem concerning the administration of a
1881	1881	commission program or operation;
1882	1882	(3) problem concerning the delivery of services in a
1883	1883	facility operated by or under contract with the commission; or
1884	1884	(4) interference by the commission with an
1885	1885	investigation conducted by the office.
1886	1886	SECTION 47. Section 64.056(b), Human Resources Code, is
1887	1887	amended to read as follows:
1888	1888	(b) The records of the independent ombudsman are
1889	1889	confidential, except that the independent ombudsman shall:
1890	1890	(1) share with the office of inspector general
1891	1891	established under Chapter 422, Government Code, for [of] the
1892	1892	commission a communication with a child that may involve the abuse
1893	1893	or neglect of the child; and
1894	1894	(2) disclose its nonprivileged records if required by
1895	1895	a court order on a showing of good cause.
1896	1896	SECTION 48. Article 2.12, Code of Criminal Procedure, is
1897	1897	amended to read as follows:
1898	1898	Art. 2.12. WHO ARE PEACE OFFICERS. The following are peace
1899	1899	officers:
1900	1900	(1) sheriffs, their deputies, and those reserve
1901	1901	deputies who hold a permanent peace officer license issued under
1902	1902	Chapter 1701, Occupations Code;
1903	1903	(2) constables, deputy constables, and those reserve
1904	1904	deputy constables who hold a permanent peace officer license issued
1905	1905	under Chapter 1701, Occupations Code;
1906	1906	(3) marshals or police officers of an incorporated
1907	1907	city, town, or village, and those reserve municipal police officers
1908	1908	who hold a permanent peace officer license issued under Chapter
1909	1909	1701, Occupations Code;
1910	1910	(4) rangers and officers commissioned by the Public
1911	1911	Safety Commission and the Director of the Department of Public
1912	1912	Safety;
1913	1913	(5) investigators of the district attorneys', criminal
1914	1914	district attorneys', and county attorneys' offices;
1915	1915	(6) law enforcement agents of the Texas Alcoholic
1916	1916	Beverage Commission;
1917	1917	(7) each member of an arson investigating unit
1918	1918	commissioned by a city, a county, or the state;
1919	1919	(8) officers commissioned under Section 37.081,
1920	1920	Education Code, or Subchapter E, Chapter 51, Education Code;
1921	1921	(9) officers commissioned by the General Services
1922	1922	Commission;
1923	1923	(10) law enforcement officers commissioned by the
1924	1924	Parks and Wildlife Commission;
1925	1925	(11) airport police officers commissioned by a city
1926	1926	with a population of more than 1.18 million that operates an airport
1927	1927	that serves commercial air carriers;
1928	1928	(12) airport security personnel commissioned as peace
1929	1929	officers by the governing body of any political subdivision of this
1930	1930	state, other than a city described by Subdivision (11), that
1931	1931	operates an airport that serves commercial air carriers;
1932	1932	(13) municipal park and recreational patrolmen and
1933	1933	security officers;
1934	1934	(14) security officers and investigators commissioned
1935	1935	as peace officers by the comptroller;
1936	1936	(15) officers commissioned by a water control and
1937	1937	improvement district under Section 49.216, Water Code;
1938	1938	(16) officers commissioned by a board of trustees
1939	1939	under Chapter 54, Transportation Code;
1940	1940	(17) investigators commissioned by the Texas Medical
1941	1941	Board;
1942	1942	(18) officers commissioned by the board of managers of
1943	1943	the Dallas County Hospital District, the Tarrant County Hospital
1944	1944	District, or the Bexar County Hospital District under Section
1945	1945	281.057, Health and Safety Code;
1946	1946	(19) county park rangers commissioned under
1947	1947	Subchapter E, Chapter 351, Local Government Code;
1948	1948	(20) investigators employed by the Texas Racing
1949	1949	Commission;
1950	1950	(21) officers commissioned under Chapter 554,
1951	1951	Occupations Code;
1952	1952	(22) officers commissioned by the governing body of a
1953	1953	metropolitan rapid transit authority under Section 451.108,
1954	1954	Transportation Code, or by a regional transportation authority
1955	1955	under Section 452.110, Transportation Code;
1956	1956	(23) investigators commissioned by the attorney
1957	1957	general under Section 402.009, Government Code;
1958	1958	(24) security officers and investigators commissioned
1959	1959	as peace officers under Chapter 466, Government Code;
1960	1960	(25) an officer employed by the Department of State
1961	1961	Health Services under Section 431.2471, Health and Safety Code;
1962	1962	(26) officers appointed by an appellate court under
1963	1963	Subchapter F, Chapter 53, Government Code;
1964	1964	(27) officers commissioned by the state fire marshal
1965	1965	under Chapter 417, Government Code;
1966	1966	(28) an investigator commissioned by the commissioner
1967	1967	of insurance under Section 701.104, Insurance Code;
1968	1968	(29) apprehension specialists [and inspectors
1969	1969	general] commissioned by the Texas Youth Commission as officers
1970	1970	under Section [Sections 61.0451 and] 61.0931, Human Resources Code;
1971	1971	(30) [officers appointed by the inspector general of
1972	1972	the Texas Department of Criminal Justice under Section 493.019,
1973	1973	Government Code;
1974	1974	[(31)] investigators commissioned by the Commission
1975	1975	on Law Enforcement Officer Standards and Education under Section
1976	1976	1701.160, Occupations Code;
1977	1977	(31) [(32)] commission investigators commissioned by
1978	1978	the Texas Private Security Board under Section 1702.061(f),
1979	1979	Occupations Code;
1980	1980	(32) [(33)] the fire marshal and any officers,
1981	1981	inspectors, or investigators commissioned by an emergency services
1982	1982	district under Chapter 775, Health and Safety Code;
1983	1983	(33) [(34)] officers commissioned by the State Board
1984	1984	of Dental Examiners under Section 254.013, Occupations Code,
1985	1985	subject to the limitations imposed by that section;
1986	1986	(34) [(35)] investigators commissioned by the Texas
1987	1987	Juvenile Probation Commission as officers under Section 141.055,
1988	1988	Human Resources Code; [and]
1989	1989	(35) [(36)] the fire marshal and any related officers,
1990	1990	inspectors, or investigators commissioned by a county under
1991	1991	Subchapter B, Chapter 352, Local Government Code; and
1992	1992	(36) officers commissioned by an office of inspector
1993	1993	general established under Chapter 422, Government Code.
1994	1994	SECTION 49. Section 1(2), Article 18.21, Code of Criminal
1995	1995	Procedure, is amended to read as follows:
1996	1996	(2) "Authorized peace officer" means:
1997	1997	(A) a sheriff or a sheriff's deputy;
1998	1998	(B) a constable or deputy constable;
1999	1999	(C) a marshal or police officer of an
2000	2000	incorporated city;
2001	2001	(D) a ranger or officer commissioned by the
2002	2002	Public Safety Commission or the director of the Department of
2003	2003	Public Safety;
2004	2004	(E) an investigator of a prosecutor's office;
2005	2005	(F) a law enforcement agent of the Alcoholic
2006	2006	Beverage Commission;
2007	2007	(G) a law enforcement officer commissioned by the
2008	2008	Parks and Wildlife Commission; or
2009	2009	(H) an enforcement officer appointed by the
2010	2010	inspector general [executive director] of the Texas Department of
2011	2011	Criminal Justice under Section 493.019, Government Code.
2012	2012	SECTION 50. Section 531.1021, Government Code, is repealed.
2013	2013	SECTION 51. (a) The amendment by this Act of Section
2014	2014	531.102, Government Code, does not affect the validity of a
2015	2015	complaint, investigation, or other proceeding initiated under that
2016	2016	section before the effective date of this Act. A complaint,
2017	2017	investigation, or other proceeding initiated under that section is
2018	2018	continued in accordance with the changes in law made by this Act.
2019	2019	(b) The repeal by this Act of Section 531.1021, Government
2020	2020	Code, does not affect the validity of a subpoena issued under that
2021	2021	section before the effective date of this Act. A subpoena issued
2022	2022	under that section before the effective date of this Act is governed
2023	2023	by the law that existed when the subpoena was issued, and the former
2024	2024	law is continued in effect for that purpose.
2025	2025	SECTION 52. (a) A person serving on the effective date of
2026	2026	this Act as inspector general for a state agency subject to Chapter
2027	2027	422, Government Code, as added by this Act, shall serve as the
2028	2028	inspector general considered appointed for the agency under Chapter
2029	2029	422, Government Code, as added by this Act, until February 1, 2013,
2030	2030	and may be reappointed under Chapter 422 if the person has the
2031	2031	qualifications required under that chapter.
2032	2032	(b) Not later than February 1, 2013, the governor or the
2033	2033	governing body of a state agency subject to Chapter 422, Government
2034	2034	Code, as added by this Act, as applicable, shall appoint an
2035	2035	inspector general for the office of inspector general of that
2036	2036	agency to a term expiring February 1, 2015.
2037	2037	SECTION 53. A contract or proceeding primarily related to a
2038	2038	function transferred to an office of inspector general established
2039	2039	under this Act is transferred to the office. The transfer does not
2040	2040	affect the status of a proceeding or the validity of a contract.
2041	2041	SECTION 54. (a) All personnel and assets currently
2042	2042	assigned to the inspector general of a state agency subject to
2043	2043	Chapter 422, Government Code, as added by this Act, shall be
2044	2044	promptly transferred to the office of inspector general for that
2045	2045	agency established under Chapter 422 along with any equipment,
2046	2046	documents, and records currently assigned to or used by the
2047	2047	inspector general of that agency. Inventory of personnel,
2048	2048	equipment, documents, records, and assets to be transferred under
2049	2049	this section shall be accomplished jointly by the transferring
2050	2050	agency and the inspector general considered appointed under Chapter
2051	2051	422 for that agency. All funds previously appropriated or used,
2052	2052	from any source, by the transferring agency in support of the
2053	2053	transferred functions, personnel, equipment, documents, records,
2054	2054	or assets shall also be contemporaneously transferred to the
2055	2055	office.
2056	2056	(b) For purposes of this section, "currently assigned"
2057	2057	means:
2058	2058	(1) all personnel and vacant full-time equivalent
2059	2059	positions assigned to or supporting a transferred function at any
2060	2060	time during the state fiscal biennium beginning September 1, 2009;
2061	2061	and
2062	2062	(2) all inventory and equipment assigned to a
2063	2063	transferred function or transferring personnel or that was in the
2064	2064	possession of transferring personnel on or at any time after
2065	2065	October 31, 2010.
2066	2066	(c) All state and federal funding, including funding for
2067	2067	overhead costs, support costs, and lease or colocation lease costs,
2068	2068	for the functions to be transferred to an office of inspector
2069	2069	general established under Chapter 422, Government Code, as added by
2070	2070	this Act, shall be reallocated to that office.
2071	2071	(d) For purposes of federal single state agency funding
2072	2072	requirements, any federal funds that may not be appropriated
2073	2073	directly to the office of inspector general for an agency subject to
2074	2074	Chapter 422, Government Code, as added by this Act, shall be
2075	2075	transferred from the single state agency receiving the funds to the
2076	2076	office of inspector general if the funds are intended for a function
2077	2077	performed by the office.
2078	2078	SECTION 55. On the effective date of this Act:
2079	2079	(1) all functions, activities, employees, rules,
2080	2080	forms, money, property, contracts, memorandums of understanding,
2081	2081	records, and obligations of a previously established office of
2082	2082	inspector general of an agency subject to Chapter 422, Government
2083	2083	Code, as added by this Act, become functions, activities,
2084	2084	employees, rules, forms, money, property, contracts, memorandums
2085	2085	of understanding, records, and obligations of the office of
2086	2086	inspector general established under Chapter 422, without a change
2087	2087	in status; and
2088	2088	(2) all money appropriated for the operations of a
2089	2089	previously established office of inspector general at an agency
2090	2090	subject to Chapter 422, Government Code, as added by this Act,
2091	2091	including money for providing administrative support, is
2092	2092	considered appropriated to the office of inspector general
2093	2093	established under Chapter 422.
2094	2094	SECTION 56. (a) Each agency subject to Chapter 422,
2095	2095	Government Code, as added by this Act, shall take all action
2096	2096	necessary to provide for the orderly transfer of the assets and
2097	2097	responsibilities of any previously established office of inspector
2098	2098	general for that agency to the office of inspector general
2099	2099	established under Chapter 422.
2100	2100	(b) A rule or form adopted by a previously established
2101	2101	office of inspector general of an agency subject to Chapter 422,
2102	2102	Government Code, as added by this Act, is a rule or form of the
2103	2103	office of inspector general established under Chapter 422 and
2104	2104	remains in effect until changed by the office of inspector general.
2105	2105	(c) A reference in law or administrative rule to a
2106	2106	previously established office of inspector general of an agency
2107	2107	subject to Chapter 422, Government Code, as added by this Act, means
2108	2108	the office of inspector general established under Chapter 422.
2109	2109	SECTION 57. If before implementing any provision of this
2110	2110	Act a state agency determines that a waiver or authorization from a
2111	2111	federal agency is necessary for implementation of that provision,
2112	2112	the agency affected by the provision shall request the waiver or
2113	2113	authorization and may delay implementing that provision until the
2114	2114	waiver or authorization is granted.
2115	2115	SECTION 58. This Act takes effect immediately if it
2116	2116	receives a vote of two-thirds of all the members elected to each
2117	2117	house, as provided by Section 39, Article III, Texas Constitution.
2118	2118	If this Act does not receive the vote necessary for immediate
2119	2119	effect, this Act takes effect September 1, 2011.