84R12133 JSL-D By: Campbell S.B. No. 1397 A BILL TO BE ENTITLED AN ACT relating to the establishment of a rural resident physician grant program. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Chapter 61, Education Code, is amended by designating Section 61.511 as Subchapter I-1 and adding a heading to that subchapter to read as follows: SUBCHAPTER I-1. PHYSICIAN RESIDENCY GRANTS Sec. 61.511. RESIDENT PHYSICIAN EXPANSION GRANT PROGRAM. (a) The board shall administer the Resident Physician Expansion Grant Program as a competitive grant program to encourage the creation of new graduate medical education positions through community collaboration and innovative funding. The board shall award grants to physician residency programs at teaching hospitals and other appropriate health care entities according to the program criteria established under Subsections (b) and (i). (b) The board shall establish criteria for the grant program in consultation with the executive commissioner of the Health and Human Services Commission, with one or more physicians, teaching hospitals, medical schools, independent physician residency programs, and with other persons considered appropriate by the board. The program criteria must: (1) take into account the following factors: (A) the characteristics of existing residency positions that receive state funding; (B) current and projected physician workforce demographics; and (C) state population trends and projections; and (2) support the following goals: (A) creating new residency positions, with an emphasis on creating new first-year residency positions, without adversely affecting existing residency positions; (B) maximizing local or federal matching funds; (C) developing accredited physician residency programs at hospitals that have not previously offered residency programs; and (D) increasing residency positions with respect to: (i) medical specialties having shortages in this state; and (ii) medically underserved areas in this state. (c) The board may provide grants only to support a residency position that: (1) is created and accredited on or after January 1, 2014; or (2) was created and accredited before January 1, 2013, but as of that date had not yet been filled. (d) A grant award may be used only to pay direct costs associated with the position, including the salary of the resident physician. (e) Each grant application must specify: (1) the number of residency positions expected to be created with the grant money; and (2) the grant amount requested for each year. (f) The board shall award grants for all residency positions awarded a grant under this section in the preceding year before awarding a grant for a residency position that did not receive a grant in the preceding year, provided that the applicable grant recipient from the preceding year complies with all conditions of the grant as described by Subsection (g). (g) The board shall monitor physician residency programs receiving grants as necessary to ensure compliance with the grant program and shall require the return of any unused grant money by, or shall decline to award additional grants to, a residency program that receives a grant but fails to: (1) create and fill, within a reasonable period, the number of residency positions proposed in the program's grant application; or (2) satisfy any other conditions of the grant imposed by the board. (h) The board shall use money forfeited under Subsection (g) to award grants to other eligible applicants. With respect to the physician residency program forfeiting the grant, the board may restore grant money or award additional grants, as applicable, to the program as soon as practicable after the program satisfies all conditions of the grant. (i) The board shall adopt rules for the administration of the grant program. The rules must include: (1) administrative provisions governing: (A) eligibility criteria for grant applicants; (B) grant application procedures; (C) guidelines relating to grant amounts; (D) guidelines relating to the number of grants to be awarded each year, subject to available funds; (E) procedures for evaluating grant applications; and (F) procedures for monitoring the use of grants; (2) methods for tracking the effectiveness of grants; and (3) any conditions relating to the receipt and use of a grant as considered appropriate by the board. (j) Not later than January 1 of each year, the board shall prepare and submit to the governor, the lieutenant governor, the speaker of the house of representatives, the standing committees of the senate and house of representatives with responsibility for oversight of health and human services issues, and the Legislative Budget Board a report that: (1) specifies each of the following with respect to the preceding program year: (A) the number of grants awarded under the program; (B) the amount of each grant awarded under the program; (C) the number of residency positions created with the support of grant money; (D) the medical specialty of the residency positions created; and (E) whether physicians who complete their training through residency positions created under the program choose to practice in this state and which medical specialties they choose for their practices; and (2) makes appropriate recommendations for legislative changes as necessary. SECTION 2. Subchapter I-1, Chapter 61, Education Code, as added by this Act, is amended by adding Section 61.512 to read as follows: Sec. 61.512. RURAL RESIDENT PHYSICIAN GRANT PROGRAM. (a) The board shall administer the Rural Resident Physician Grant Program as a competitive grant program to encourage the creation of new graduate medical education positions in rural and nonmetropolitan areas. The board shall award grants to new or expanded physician residency programs at teaching hospitals and other appropriate health care entities according to the program criteria established under Subsections (b) and (i). (b) The board shall establish criteria for the grant program in consultation with the executive commissioner of the Health and Human Services Commission, with one or more physicians, teaching hospitals, medical schools, and independent physician residency programs, and with other persons considered appropriate by the board. The program criteria must take into account whether a rural or nonmetropolitan area has the resources sufficient to support a physician residency program in a manner that would satisfy applicable residency accreditation requirements. (c) The board may provide grants only to support a physician residency program that provides the level of medical care that is most needed in a rural or nonmetropolitan area. (d) Grant funds awarded under this section may be used only to pay direct costs associated with creating or maintaining a residency position, including the salary of the resident physician. (e) Each grant application must specify: (1) the number of residency positions expected to be created or maintained with the grant money; and (2) the grant amount requested for each year. (f) The board shall award grants for all residency positions awarded a grant under this section in the preceding year before awarding a grant for a residency position that did not receive a grant in the preceding year, provided that the applicable grant recipient from the preceding year complies with all conditions of the grant as described by Subsection (g). (g) The board shall monitor physician residency programs receiving grants as necessary to ensure compliance with the grant program and shall require the return of any unused grant money by, or shall decline to award additional grants to, a residency program that receives a grant but fails to: (1) create and fill, within a reasonable period, the number of residency positions proposed in the program's grant application; or (2) satisfy any other conditions of the grant imposed by the board. (h) The board shall use money forfeited under Subsection (g) to award grants to other eligible applicants. With respect to the physician residency program forfeiting the grant, the board may restore grant money or award additional grants, as applicable, to the program as soon as practicable after the program satisfies all conditions of the grant. (i) The board shall adopt rules for the administration of the grant program. The rules must include: (1) administrative provisions governing: (A) eligibility criteria for grant applicants; (B) grant application procedures; (C) guidelines relating to grant amounts; (D) guidelines relating to the number of grants to be awarded each year, subject to available funds; (E) procedures for evaluating grant applications; (F) procedures for monitoring the use of grants; and (G) reporting requirements for grant recipients; (2) methods for tracking the effectiveness of grants; and (3) any conditions relating to the receipt and use of a grant as considered appropriate by the board. SECTION 3. (a) As soon as practicable after the effective date of this Act, the Texas Higher Education Coordinating Board shall adopt rules for the implementation and administration of the grant program established under Section 61.512, Education Code, as added by this Act. The board may adopt the initial rules in the manner provided by law for emergency rules. (b) Not later than October 1, 2015, the Texas Higher Education Coordinating Board shall establish the grant program required by Section 61.512, Education Code, as added by this Act, and shall begin to award grants under that program not later than January 1, 2016. SECTION 4. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2015.