83R2608 KFF-D
By: Perry H.B. No. 3784
A BILL TO BE ENTITLED
AN ACT
relating to the creation of a state court to hear cases involving
insurance and Medicaid fraud.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle A, Title 2, Government Code, is amended
by adding Chapter 23A to read as follows:
CHAPTER 23A. STATE COURT ON INSURANCE AND MEDICAID FRAUD
Sec. 23A.001. DEFINITION. In this chapter, "state court"
means the state court established under this chapter to hear
certain cases involving insurance and Medicaid fraud.
Sec. 23A.002. APPLICABILITY OF OTHER LAW. Except to the
extent of a conflict with this chapter, a law, other than Chapter 24
and Subchapter D, Chapter 51, that applies to:
(1) a district court of Travis County, including a law
relating to how a case is appealed from the district court, applies
to the state court; and
(2) a district judge, including any law providing for
the qualifications, compensation, or retirement benefits of
district court judges, applies to a state court judge.
Sec. 23A.003. APPOINTMENTS TO STATE COURT BY GOVERNOR;
TERMS; VACANCIES. (a) The governor shall appoint with the advice
and consent of the senate eight judges and one presiding judge to
the state court.
(b) The judges serve staggered terms of two years, with four
judges' terms expiring January 1 of each odd-numbered year and five
judges' terms, including that of the presiding judge, expiring
January 1 of each even-numbered year.
(c) The governor shall fill any vacancy on the court for the
remainder of the unexpired term.
Sec. 23A.004. DISQUALIFICATION. The fact that at least two
members of the state court are disqualified to determine a case in
the court shall be certified to the governor. The governor
immediately shall commission the requisite number of persons who
are learned in the law to try and determine the case.
Sec. 23A.005. LOCATION; TERMS OF COURT. The state court may
sit at any time during the year at the seat of government or, at the
court's discretion, at any other location in this state for the
transaction of business, and each term of either court shall begin
and end with each calendar year.
Sec. 23A.006. ADJOURNMENT. (a) A state court may adjourn
from day to day or for the periods that the court considers proper.
(b) If a quorum of a state court is not present on any day of
the term, a judge of the court or the bailiff attending the court
may adjourn the court from time to time until a quorum is present,
but the court may not be finally adjourned for the term.
Sec. 23A.007. CIVIL JURISDICTION. The state court has
concurrent jurisdiction with the district courts in all actions,
proceedings, and remedies involving an allegation of:
(1) Medicaid fraud under Chapter 36, Human Resources
Code; or
(2) the commission of an unfair method of competition
or an unfair or deceptive act or practice in the business of
insurance under Chapter 541, Insurance Code, or Section 17.46,
Business & Commerce Code.
Sec. 23A.008. WRIT POWER. A judge of the state court may,
either in termtime or vacation, grant writs of mandamus,
injunction, sequestration, attachment, garnishment, certiorari,
and supersedeas and all other writs necessary to the enforcement of
the court's jurisdiction.
Sec. 23A.009. COURT SITTING IN PANELS. (a) Each state
court may sit in panels of not fewer than three judges for the
purpose of hearing cases.
(b) If more than one panel is used, the state court shall
establish rules to periodically rotate the judges among the panels.
Permanent civil panels without rotation may not be established.
(c) A majority of a panel constitutes a quorum for the
transaction of business, and the concurrence of a majority of a
panel is necessary for a decision.
Sec. 23A.010. COURT SITTING EN BANC. (a) The presiding
judge of the state court, under rules established by the court,
shall convene the court en banc for the transaction of all business
other than the hearing of cases and may convene the court en banc
for the purpose of hearing cases.
(b) When convened en banc, a majority of the membership of
the state court constitutes a quorum, and the concurrence of a
majority of the court sitting en banc is necessary for a decision.
Sec. 23A.011. SEAL. The clerk of the state court shall
obtain a seal for the court. The seal shall have a star with five
points and the words "The State Court of Texas on Insurance and
Medicaid Fraud" engraved on it.
Sec. 23A.012. APPEALS. An appeal from the state court is in
the same manner as an appeal from a district court of Travis County.
Sec. 23A.013. FUNDING; USE OF MONEY. (a) Existing
appropriations to the attorney general available for the purpose
shall be used to establish the state court.
(b) The legislature shall use money the state saves or
recovers as a result of a proceeding in the state court established
under this chapter to fund the court.
SECTION 2. Chapter 51, Government Code, is amended by
adding Subchapter B-1 to read as follows:
SUBCHAPTER B-1. CLERK OF STATE COURT
Sec. 51.151. DEFINITION. In this subchapter, "state court"
means the state court established under Chapter 23A.
Sec. 51.152. APPOINTMENT OF CLERK. The state court shall
appoint a clerk of the court who:
(1) shall give bond in the manner provided by this
subchapter; and
(2) may hold office for four years subject to removal
by the appointing court for good cause, entered in the minutes of
the court.
Sec. 51.153. OATH; BOND. The clerk of the state court must
sign the oath prescribed for officers of this state and must give a
bond in the amount of $5,000. The bond must be approved by the state
court and is subject to the same conditions as the bond required of
a district clerk.
Sec. 51.154. DEPUTY CLERK. (a) The state court, or the
clerk of the state court with the court's approval, may appoint a
stenographer employed by the court to act as a deputy clerk to
perform the clerk's duties during the absence, illness, or other
disability of the clerk.
(b) The stenographer appointed deputy clerk shall perform
the duties of the clerk in the name of the clerk and shall sign the
deputy clerk's own name as deputy clerk after signing the clerk's
name.
Sec. 51.155. REMOVAL OF CLERK. The state court may remove
the clerk for good cause, entered in the minutes of the court.
Sec. 51.156. DUTIES AND LIABILITIES. (a) The clerk of the
state court shall perform the duties for the state court that a
district clerk performs for a district court.
(b) The clerk of the state court is subject to the
liabilities prescribed for a district clerk.
SECTION 3. Effective January 1, 2014, Section 36.008, Human
Resources Code, is amended to read as follows:
Sec. 36.008. USE OF MONEY RECOVERED. The legislature, in
appropriating money recovered under this chapter, shall:
(1) use a percentage of the funds recovered to fund the
state court established under Chapter 23A, Government Code; and
(2) consider the requirements of the attorney general
and other affected state agencies in investigating Medicaid fraud
and enforcing this chapter.
SECTION 4. Effective January 1, 2014, Section 36.051(b),
Human Resources Code, is amended to read as follows:
(b) An action under this section shall be brought in the
state court established under Chapter 23A, Government Code, or in
the [a] district court of [Travis County or of] a county in which
any part of the unlawful act occurred, is occurring, or is about to
occur.
SECTION 5. Effective January 1, 2014, Section 36.052(d),
Human Resources Code, is amended to read as follows:
(d) An action under this section shall be brought in the
state court established under Chapter 23A, Government Code, or
[Travis County or] in a county in which any part of the unlawful act
occurred.
SECTION 6. Effective January 1, 2014, Section 36.053(e),
Human Resources Code, is amended to read as follows:
(e) If a person fails to file a statement as required by
Subsection (b)(1) or fails to submit to an examination as required
by Subsection (b)(2), the attorney general may file in the state
court established under Chapter 23A, Government Code, [a district
court of Travis County] a petition for an order to compel the person
to file the statement or submit to the examination within a period
stated by court order. Failure to comply with an order entered
under this subsection is punishable as contempt.
SECTION 7. Effective January 1, 2014, Sections 36.054(f)
and (j), Human Resources Code, are amended to read as follows:
(f) A person may file a petition, stating good cause, to
extend the return date for the demand or to modify or set aside the
demand. A petition under this section shall be filed in the state
court established under Chapter 23A, Government Code, [a district
court of Travis County] and must be filed before the earlier of:
(1) the return date specified in the demand; or
(2) the 20th day after the date the demand is served.
(j) If a person fails to comply with an investigative
demand, or if copying and reproduction of the documentary material
demanded cannot be satisfactorily accomplished and the person
refuses to surrender the documentary material, the attorney general
may file in the state court established under Chapter 23A,
Government Code, [a district court of Travis County] a petition for
an order to enforce the investigative demand.
SECTION 8. Effective January 1, 2014, Section 541.004,
Insurance Code, is amended to read as follows:
Sec. 541.004. VENUE FOR ACTIONS INVOLVING DEPARTMENT OR
COMMISSIONER. An action under this chapter in which the department
or commissioner is a party must be brought in the state court
established under Chapter 23A, Government Code [a district court in
Travis County].
SECTION 9. Effective January 1, 2014, Section 541.106(a),
Insurance Code, is amended to read as follows:
(a) If a person refuses to comply with a subpoena issued in
connection with a hearing under this subchapter or refuses to
testify with respect to a matter about which the person may be
lawfully interrogated, on application of the department, the state
court established under Chapter 23A, Government Code, or a
district court in [Travis County or in] the county in which the
person resides may order the person to comply with the subpoena or
testify.
SECTION 10. Effective January 1, 2014, Section 541.202,
Insurance Code, is amended to read as follows:
Sec. 541.202. VENUE FOR INJUNCTIVE ACTION. An action for an
injunction under this subchapter may be commenced in:
(1) the state court established under Chapter 23A,
Government Code; or
(2) a district court in:
(A) [(1)] the county in which the person against
whom the action is brought:
(i) [(A)] resides;
(ii) [(B)] has the person's principal place
of business; or
(iii) [(C)] is engaging in business; or
(B) [(2)] the county in which the transaction or
a substantial portion of the transaction occurred[; or
[(3) Travis County].
SECTION 11. Effective January 1, 2014, Section 541.303(b),
Insurance Code, is amended to read as follows:
(b) Venue for the action is in the state court established
under Chapter 23A, Government Code [a district court in Travis
County].
SECTION 12. Effective January 1, 2014, Section 541.405(a),
Insurance Code, is amended to read as follows:
(a) A person aggrieved by the denial of a petition under
Section 541.402 or the adoption, amendment, or repeal of or failure
to adopt a rule under this subchapter may file a petition in the
state court established under Chapter 23A, Government Code, [a
district court in Travis County] for:
(1) a declaratory judgment on the validity or
applicability of an adopted, amended, or repealed rule; or
(2) review of the denial of a petition under Section
541.402.
SECTION 13. Not later than December 1, 2013, the Texas
Supreme Court shall adopt rules the court determines necessary to
establish the state court on insurance and Medicaid fraud
established under Chapter 23A, Government Code, as added by this
Act.
SECTION 14. Not later than January 1, 2014, the governor
shall appoint the judges and presiding judge of the state court on
insurance and Medicaid fraud established under Chapter 23A,
Government Code, as added by this Act. To enable the staggering of
terms as required by Section 23A.003(b), Government Code, the
governor shall appoint four judges whose terms expire on January 1
of the next odd-numbered year and five judges, including the
presiding judge, whose terms expire on January 1 of the next
even-numbered year.
SECTION 15. The changes in law made by this Act apply only
to a case filed on or after January 1, 2014. A case filed before
January 1, 2014, is governed by the law in effect on the date the
case was filed, and the former law is continued in effect for that
purpose.
SECTION 16. Except as otherwise provided by this Act, this
Act takes effect September 1, 2013.