By: Sheffield, et al. (Senate Sponsor - Hinojosa) H.B. No. 2766
(In the Senate - Received from the House May 12, 2017;
May 18, 2017, read first time and referred to Committee on Health &
Human Services; May 23, 2017, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 6, Nays 3;
May 23, 2017, sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR H.B. No. 2766 By: Schwertner
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of certain long-term care facilities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 242, Health and Safety Code, is amended
by adding Subchapter P to read as follows:
SUBCHAPTER P. REINVESTMENT ALLOWANCE
Sec. 242.701. DEFINITIONS. In this subchapter:
(1) "Gross receipts" means the gross inpatient revenue
received by a facility from services provided to facility
residents. Gross receipts exclude revenue from nonresident care,
including beauty and barber services, vending facilities,
interest, charitable contributions, the sale of meals, and
outpatient services.
(2) "Non-Medicare patient day" means a day on which
the primary payer for a facility resident is not Medicare Part A or
a Medicare Advantage or special needs plan.
Sec. 242.702. APPLICABILITY. This subchapter does not
apply to:
(1) a state-owned veterans nursing facility; or
(2) a facility that provides on a single campus a
combination of services, which may include independent living
services, licensed assisted living services, or licensed nursing
facility care services, and that either:
(A) holds a certificate of authority to operate a
continuing care retirement community under Chapter 246; or
(B) had during the previous 12 months a combined
number of patient days of service provided to independent living
and assisted living residents, excluding services provided to
persons occupying facility beds in a licensed nursing facility,
that exceeded the number of patient days of service provided to
nursing facility residents.
Sec. 242.703. REINVESTMENT ALLOWANCE; COMPUTATION. (a)
The commission shall impose a reinvestment allowance on each
facility licensed under this chapter. The reinvestment allowance
is:
(1) the product of the amount established under
Subsection (b) multiplied by the number of a facility's
non-Medicare patient days calculated under Section 242.704;
(2) payable monthly; and
(3) in addition to other amounts imposed under this
chapter.
(b) The executive commissioner shall establish for each
non-Medicare patient day an amount for use in calculating the
reinvestment allowance sufficient to produce annual revenues from
all facilities not to exceed the maximum amount that may be assessed
within the indirect guarantee threshold provided under 42 C.F.R.
Section 433.68(f)(3)(i).
(c) The commission shall determine the amount described by
Subsection (b) using non-Medicare patient days and gross receipts:
(1) reported to the commission; and
(2) covering a period of at least six months.
(d) A facility may not list the reinvestment allowance as a
separate charge on a resident's billing statement or otherwise
directly or indirectly attempt to charge the reinvestment allowance
to a resident.
Sec. 242.704. PATIENT DAYS. For each calendar day, a
facility shall determine the number of non-Medicare patient days by
adding:
(1) the number of non-Medicare residents occupying a
bed in the facility immediately before midnight of that day plus the
number of residents admitted that day, less the number of residents
discharged that day, except a resident is included in the count
under this subdivision if:
(A) the resident is admitted and discharged on
the same day; or
(B) the resident is discharged that day because
of the resident's death; and
(2) the number of beds that are on hold that day and
that have been placed on hold for a period not to exceed three
consecutive calendar days during which a resident is:
(A) in the hospital; or
(B) on therapeutic home leave.
Sec. 242.705. COLLECTION AND REPORTING. (a) The
commission shall collect the reinvestment allowance.
(b) Not later than the 25th day after the last day of a
month, each facility shall:
(1) file with the commission a report stating the
total non-Medicare patient days for the month; and
(2) pay the reinvestment allowance.
Sec. 242.706. RULES; ADMINISTRATIVE PENALTY. (a) The
executive commissioner shall adopt rules to administer this
subchapter, including rules related to imposing and collecting the
reinvestment allowance.
(b) Notwithstanding Section 242.066, an administrative
penalty assessed under that section for a violation of this
subchapter may not exceed the greater of:
(1) one-half of the amount of the facility's
outstanding reinvestment allowance; or
(2) $20,000.
(c) An administrative penalty assessed for a violation of
this subchapter is in addition to the facility's outstanding
reinvestment allowance.
Sec. 242.707. NURSING FACILITY REINVESTMENT ALLOWANCE
TRUST FUND. (a) The nursing facility reinvestment allowance trust
fund is established as a trust fund to be held by the comptroller
outside of the state treasury and administered by the commission as
trustee. Interest and income from the assets of the trust fund
shall be credited to and deposited in the trust fund. The commission
may use money in the fund only as provided by Section 242.708.
(b) The commission shall remit the reinvestment allowance
collected under this subchapter and federal matching funds received
by this state to the comptroller for deposit in the trust fund.
Sec. 242.708. REIMBURSEMENT OF FACILITIES. (a) The
commission may use money in the nursing facility reinvestment
allowance trust fund, including any federal matching funds, only
for the following purposes:
(1) paying any commission cost to develop and
administer systems for managing the reinvestment allowance;
(2) reimbursing the Medicaid share of the reinvestment
allowance as an allowable cost in the Medicaid daily rate; and
(3) increasing reimbursement rates paid under the
state Medicaid program to facilities.
(b) The commission shall allocate 50 percent of the money
described by Subsection (a)(3) for increased reimbursement rate
payments based on the total rating of the Centers for Medicare and
Medicaid Services five-star quality rating system.
(c) The commission shall devise a formula by which amounts
received under this subchapter increase the reimbursement rates
paid to facilities under the state Medicaid program, including a
phase-in of the program described by Subsection (b) beginning on
September 1, 2018. The commission must include in the formula
consideration of the total rating described by Subsection (b).
(d) Money in the nursing facility reinvestment allowance
trust fund may not be used to expand Medicaid eligibility under the
Patient Protection and Affordable Care Act (Pub. L. No. 111-148) as
amended by the Health Care and Education Reconciliation Act of 2010
(Pub. L. No. 111-152).
Sec. 242.709. INVALIDITY; FEDERAL FUNDS. If any provision
of or procedure under this subchapter is held invalid by a final
court order that is not subject to appeal, or if the commission
determines that the imposition of the reinvestment allowance and
the expenditure of amounts collected as prescribed by this
subchapter will not entitle the state to receive federal matching
funds under the Medicaid program or will be inconsistent with the
objectives described by Section 537.002(b)(7), Government Code,
the commission shall:
(1) stop collection of the reinvestment allowance; and
(2) not later than the 30th day after the date
collection is stopped, return to each facility, in proportion to
the total amount paid by the facility, any money deposited to the
credit of the nursing facility reinvestment allowance trust fund
but not spent.
Sec. 242.710. AUTHORITY TO ACCOMPLISH PURPOSES OF
SUBCHAPTER. The executive commissioner by rule may adopt a
definition, a method of computation, or a rate that differs from
those expressly provided by or expressly authorized by this
subchapter to the extent the difference is necessary to accomplish
the purposes of this subchapter.
Sec. 242.711. ANNUAL REPORT. Not later than January 1 of
each year, the commission shall prepare and deliver to the
governor, the lieutenant governor, and the speaker of the house of
representatives a report relating to the status of the nursing
facility reinvestment allowance program, including fees collected,
federal funding applied for and received, quality-based payments
made, information on the overall quality of care in the Texas
nursing home system, whether quality-based payments are
contributing to quality improvements, and any other relevant
information necessary for assessing the effectiveness of the
nursing facility reinvestment allowance program. The report should
include any information associated with the role of the comptroller
and the Medicaid managed care participating plans. The report must
be posted on the commission's Internet website.
Sec. 242.712. PROGRAM EVALUATION. Not later than November
1, 2020, the commission shall prepare and deliver to the governor,
the lieutenant governor, and the speaker of the house of
representatives a report that assesses whether and to what degree
payments associated with quality-based care are resulting in
improvements to overall nursing home quality.
Sec. 242.713. EXPIRATION. This subchapter expires August
31, 2021.
SECTION 2. (a) Sections 531.058(a) and (a-1), Government
Code, are amended to read as follows:
(a) The executive commissioner by rule shall establish an
informal dispute resolution process in accordance with this
section. The process must provide for adjudication by an
appropriate disinterested person of disputes relating to a proposed
enforcement action or related proceeding of the commission under
Section 32.021(d), Human Resources Code, or the Department of Aging
and Disability Services or its successor agency under Chapter 242,
247, or 252, Health and Safety Code. The informal dispute
resolution process must require:
(1) an institution or facility to request informal
dispute resolution not later than the 10th calendar day after
notification by the commission or department, as applicable, of the
violation of a standard or standards; and
(2) the commission to complete the process not later
than:
(A) the 30th calendar day after receipt of a
request from an institution or facility, other than an assisted
living facility, for informal dispute resolution; or
(B) the 90th calendar day after receipt of a
request from an assisted living facility for informal dispute
resolution.
(a-1) As part of the informal dispute resolution process
established under this section, the commission shall contract with
an appropriate disinterested person [who is a nonprofit
organization] to adjudicate disputes between an institution or
facility licensed under Chapter 242 or 247, Health and Safety Code,
and the Department of Aging and Disability Services or its
successor agency concerning a statement of violations prepared by
the department in connection with a survey conducted by the
department of the institution or facility. Section 2009.053 does
not apply to the selection of an appropriate disinterested person
under this subsection. The person with whom the commission
contracts shall adjudicate all disputes described by this
subsection.
(b) Subchapter B, Chapter 531, Government Code, is amended
by adding Section 531.0585 to read as follows:
Sec. 531.0585. ISSUANCE OF MATERIALS TO CERTAIN LONG-TERM
CARE FACILITIES. The executive commissioner shall review the
commission's methods for issuing informational letters, policy
updates, policy clarifications, and other related materials to an
entity licensed under Chapter 103, Human Resources Code, or Chapter
242, 247, 248A, or 252, Health and Safety Code, and develop and
implement more efficient methods to issue those materials as
appropriate.
(c) Section 242.066, Health and Safety Code, is amended by
amending Subsections (a) and (e) and adding Subsection (i) to read
as follows:
(a) The commission [department] may assess an
administrative penalty against a person who:
(1) violates this chapter or a rule, standard, or
order adopted or license issued under this chapter;
(2) makes a false statement, that the person knows or
should know is false, of a material fact:
(A) on an application for issuance or renewal of
a license or in an attachment to the application; or
(B) with respect to a matter under investigation
by the commission [department];
(3) refuses to allow a representative of the
commission [department] to inspect:
(A) a book, record, or file required to be
maintained by an institution; or
(B) any portion of the premises of an
institution;
(4) wilfully interferes with the work of a
representative of the commission [department] or the enforcement of
this chapter;
(5) wilfully interferes with a representative of the
commission [department] preserving evidence of a violation of this
chapter or a rule, standard, or order adopted or license issued
under this chapter;
(6) fails to pay a penalty assessed by the commission
[department] under this chapter not later than the 10th day after
the date the assessment of the penalty becomes final; or
(7) fails to notify the commission [department] of a
change of ownership before the effective date of the change of
ownership.
(e) In determining the amount of a penalty, the commission
[department] shall consider any matter that justice may require,
including:
(1) the gradations of penalties established under
Subsection (d);
(2) the seriousness of the violation, including the
nature, circumstances, extent, and gravity of the prohibited act
and the hazard or potential hazard created by the act to the health
or safety of the public;
(3) the history of previous violations;
(4) deterrence of future violations; and
(5) efforts to correct the violation.
(i) The commission shall develop and use a system to record
and track the scope and severity of each violation of this chapter
or a rule, standard, or order adopted under this chapter for the
purpose of assessing an administrative penalty for the violation or
taking some other enforcement action against the appropriate
institution to deter future violations. The system:
(1) must be comparable to the system used by the
Centers for Medicare and Medicaid Services to categorize the scope
and severity of violations for nursing homes; and
(2) may be modified, as appropriate, to reflect
changes in industry practice or changes made to the system used by
the Centers for Medicare and Medicaid Services.
(d) Section 242.0665, Health and Safety Code, is amended to
read as follows:
Sec. 242.0665. RIGHT TO CORRECT. (a) The commission
[department] may not collect an administrative penalty against an
institution under this subchapter if, not later than the 45th day
after the date the institution receives notice under Section
242.067(c), the institution corrects the violation.
(b) Subsection (a) does not apply:
(1) to a violation that the commission [department]
determines:
(A) represents a pattern of violation that
results in actual [serious] harm [to or death of a resident];
(B) is widespread in scope and results in actual
harm;
(C) is widespread in scope, constitutes a
potential for actual harm, and relates to:
(i) residents' rights;
(ii) treatment of residents;
(iii) resident behavior and institution
practices;
(iv) quality of care;
(v) medication errors;
(vi) standard menus and nutritional
adequacy;
(vii) physician visits;
(viii) infection control;
(ix) life safety from fire; or
(x) emergency preparedness and response;
(D) [(B)] constitutes an immediate [a serious]
threat to the health or safety of a resident; or
(E) [(C)] substantially limits the institution's
capacity to provide care;
(2) to a violation described by Sections
242.066(a)(2)-(7);
(3) to a violation of Section 260A.014 or 260A.015; or
(4) to a violation of a right of a resident adopted
under Subchapter L.
(c) An institution that corrects a violation under
Subsection (a) must maintain the correction. If the institution
fails to maintain the correction until at least the first
anniversary of the date the correction was made, the commission
[department] may assess an administrative penalty under this
subchapter for the subsequent violation. A penalty assessed under
this subsection shall be equal to three times the amount of the
penalty assessed but not collected under Subsection (a). The
commission [department] is not required to provide the institution
an opportunity to correct the subsequent violation under this
section.
(d) In this section:
(1) "Actual harm" means a negative outcome that
compromises a resident's physical, mental, or emotional
well-being.
(2) "Immediate threat to the health or safety of a
resident" means a situation that causes, or is likely to cause,
serious injury, harm, or impairment to or the death of a resident.
(3) "Pattern of violation" means repeated, but not
pervasive, failures of an institution to comply with this chapter
or a rule, standard, or order adopted under this chapter that:
(A) result in a violation; and
(B) are found throughout the services provided by
the institution or that affect or involve the same residents or
institution employees.
(4) "Widespread in scope" means a violation of this
chapter or a rule, standard, or order adopted under this chapter
that:
(A) is pervasive throughout the services
provided by the institution; or
(B) represents a systemic failure by the
institution that affects or has the potential to affect a large
portion of or all of the residents of the institution.
(e) Section 247.023, Health and Safety Code, is amended to
read as follows:
Sec. 247.023. ISSUANCE AND RENEWAL OF LICENSE. (a) The
commission [department] shall issue a license if, after inspection
and investigation, it finds that the applicant, the assisted living
facility, and all controlling persons with respect to the applicant
or facility meet the requirements of this chapter and the standards
adopted under this chapter. The license expires on the third
[second] anniversary of the date of its issuance. The executive
commissioner by rule shall [may] adopt a system under which
licenses expire on staggered [various] dates during each [the]
three-year [two-year] period. The commission shall prorate the
license fee as appropriate if the expiration date of a license
changes as a result of this subsection [For the year in which a
license expiration date is changed, the department shall prorate
the license fee on a monthly basis. Each license holder shall pay
only that portion of the license fee allocable to the number of
months during which the license is valid. A license holder shall
pay the total license renewal fee at the time of renewal].
(b) To renew a license, the license holder must submit to
the commission [department] the license renewal fee.
(c) The commission [department] may require participation
in a continuing education program as a condition of renewal of a
license. The executive commissioner shall adopt rules to implement
this subsection.
(f) Sections 247.024(a), (d), and (e), Health and Safety
Code, are amended to read as follows:
(a) The executive commissioner by rule shall set license
fees imposed by this chapter:
(1) on the basis of the number of beds in assisted
living facilities required to pay the fee; and
(2) in amounts reasonable and necessary to defray the
cost of administering this chapter, but not to exceed $2,250
[$1,500].
(d) Investigation fees or attorney's fees may not be
assessed against or collected from an assisted living facility by
or on behalf of the commission [department] or another state agency
unless the commission [department] or other state agency assesses
and collects a penalty authorized by this chapter from the
facility.
(e) An applicant who submits a license renewal later than
the 45th day before the expiration date of a current license is
subject to a late fee in accordance with commission [department]
rules.
(g) Section 247.027, Health and Safety Code, is amended to
read as follows:
Sec. 247.027. INSPECTIONS. (a) In addition to the
inspection required under Section 247.023(a), the commission:
(1) shall [department may] inspect each [an] assisted
living facility at least every two years following the initial
inspection required under Section 247.023(a); [annually] and
(2) may inspect a facility at other reasonable times
as necessary to assure compliance with this chapter.
(b) The commission [department] shall establish an
inspection checklist based on the minimum standards that describes
the matters subject to inspection. The commission [department]
shall use the inspection checklist in conducting inspections under
this section and Section 247.023(a).
(h) Section 247.0451, Health and Safety Code, is amended by
amending Subsections (a), (b), (d), and (f) and adding Subsections
(g) and (h) to read as follows:
(a) The commission [department] may assess an
administrative penalty against a person who:
(1) violates this chapter or a rule, standard, or
order adopted under this chapter or a term of a license issued under
this chapter;
(2) makes a false statement, that the person knows or
should know is false, of a material fact:
(A) on an application for issuance or renewal of
a license or in an attachment to the application; or
(B) with respect to a matter under investigation
by the commission [department];
(3) refuses to allow a representative of the
commission [department] to inspect:
(A) a book, record, or file required to be
maintained by an assisted living facility; or
(B) any portion of the premises of an assisted
living facility;
(4) wilfully interferes with the work of a
representative of the commission [department] or the enforcement of
this chapter;
(5) wilfully interferes with a representative of the
commission [department] preserving evidence of a violation of this
chapter or a rule, standard, or order adopted under this chapter or
a term of a license issued under this chapter;
(6) fails to pay a penalty assessed under this chapter
not later than the 30th day after the date the assessment of the
penalty becomes final; or
(7) fails to notify the commission [department] of a
change of ownership before the effective date of the change of
ownership.
(b) Except as provided by Section 247.0452(c), the penalty
may not exceed:
(1) $5,000 for each violation that:
(A) represents a pattern of violation that
results in actual harm or is widespread in scope and results in
actual harm; or
(B) constitutes an immediate threat to the health
or safety of a resident; or
(2) $1,000 for each other violation.
(d) In determining the amount of a penalty, the commission
[department] shall consider any matter that justice may require,
but must consider each of the following and make a record of the
extent to which each of the following was considered:
(1) the gradations of penalties established under
Subsection (c);
(2) the seriousness of the violation, including the
nature, circumstances, extent, and gravity of the prohibited act
and the hazard or potential hazard created by the act to the health
or safety of the public;
(3) the history of previous violations;
(4) deterrence of future violations;
(5) efforts to correct the violation; and
(6) the size of the facility and of the business entity
that owns the facility.
(f) The commission [department] may not assess a penalty
under this section against a resident of an assisted living
facility unless the resident is also an employee of the facility or
a controlling person.
(g) The commission shall develop and use a system to record
and track the scope and severity of each violation of this chapter
or a rule, standard, or order adopted under this chapter for the
purpose of assessing an administrative penalty for the violation or
taking some other enforcement action against the appropriate
assisted living facility to deter future violations. The system:
(1) must be comparable to the system used by the
Centers for Medicare and Medicaid Services to categorize the scope
and severity of violations for nursing homes; and
(2) may be modified, as appropriate, to reflect
changes in industry practice or changes made to the system used by
the Centers for Medicare and Medicaid Services.
(h) In this section, "actual harm," "immediate threat to the
health or safety of a resident," "pattern of violation," and
"widespread in scope" have the meanings assigned by Section
247.0452.
(i) Section 247.0452, Health and Safety Code, is amended to
read as follows:
Sec. 247.0452. RIGHT TO CORRECT. (a) The commission
[department] may not collect an administrative penalty from an
assisted living facility under Section 247.0451 if, not later than
the 45th day after the date the facility receives notice under
Section 247.0453(c), the facility corrects the violation.
(b) Subsection (a) does not apply:
(1) to a violation that the commission [department]
determines represents a pattern of violation that results in actual
[serious] harm [to or death of a resident];
(2) to a violation that the commission determines is
widespread in scope and results in actual harm;
(3) to a violation that the commission determines is
widespread in scope, constitutes a potential for actual harm, and
relates to:
(A) resident assessment;
(B) staffing, including staff training;
(C) administration of medication;
(D) infection control;
(E) restraints; or
(F) emergency preparedness and response;
(4) to a violation that the commission determines
constitutes an immediate threat to the health or safety of a
resident;
(5) [(2)] to a violation described by Sections
247.0451(a)(2)-(7) or a violation of Section 260A.014 or 260A.015;
(6) [(3)] to a second or subsequent violation of:
(A) a right of the same resident under Section
247.064; or
(B) the same right of all residents under Section
247.064; or
(7) [(4)] to a violation described by Section 247.066,
which contains its own right to correct provisions.
(c) An assisted living facility that corrects a violation
must maintain the correction. If the facility fails to maintain the
correction until at least the first anniversary of the date the
correction was made, the commission [department] may assess and
collect an administrative penalty for the subsequent violation. An
administrative penalty assessed under this subsection is equal to
three times the amount of the original penalty assessed but not
collected. The commission [department] is not required to provide
the facility with an opportunity under this section to correct the
subsequent violation.
(d) In this section:
(1) "Actual harm" means a negative outcome that
compromises a resident's physical, mental, or emotional
well-being.
(2) "Immediate threat to the health or safety of a
resident" means a situation that causes, or is likely to cause,
serious injury, harm, or impairment to or the death of a resident.
(3) "Pattern of violation" means repeated, but not
pervasive, failures of an assisted living facility to comply with
this chapter or a rule, standard, or order adopted under this
chapter that:
(A) result in a violation; and
(B) are found throughout the services provided by
the facility or that affect or involve the same residents or
facility employees.
(4) "Widespread in scope" means a violation of this
chapter or a rule, standard, or order adopted under this chapter
that:
(A) is pervasive throughout the services
provided by the assisted living facility; or
(B) represents a systemic failure by the assisted
living facility that affects or has the potential to affect a large
portion of or all of the residents of the facility.
(j) Section 248A.053, Health and Safety Code, is amended to
read as follows:
Sec. 248A.053. INITIAL OR RENEWAL LICENSE TERM; RENEWAL;
NOTIFICATION. (a) An initial or renewal license issued under this
chapter expires on the third [second] anniversary of the date of
issuance. The executive commissioner by rule shall adopt a system
under which licenses expire on staggered dates during each
three-year period. The commission shall prorate the license fee as
appropriate if the expiration date of a license changes as a result
of this subsection.
(b) A person applying to renew a center license shall:
(1) submit a renewal application to the commission
[department] on a [the form] prescribed form [by the department] at
least 60 days but not more than 120 days before expiration of the
license;
(2) submit the renewal fee in the amount required by
agency [department] rule; and
(3) comply with any other requirements specified by
agency [department] rule.
(c) The commission [department] shall assess a $50 per day
late fee to a license holder who submits a renewal application after
the date required by Subsection (b)(1), except that the total
amount of a late fee may not exceed the lesser of 50 percent of the
license renewal fee or $500.
(d) At least 120 days before expiration of a center license,
the commission [department] shall notify the owner or operator of
the center of the license expiration.
(k) Subchapter F, Chapter 248A, Health and Safety Code, is
amended by adding Section 248A.2515 to read as follows:
Sec. 248A.2515. SYSTEM FOR ASSESSMENT OF PENALTY. The
commission shall develop and use a system to record and track the
scope and severity of each violation of this chapter or a rule or
standard adopted or order issued under this chapter for the purpose
of assessing an administrative penalty for the violation or taking
some other enforcement action against the appropriate center to
deter future violations. The system:
(1) must be comparable to the system used by the
Centers for Medicare and Medicaid Services to categorize the scope
and severity of violations for nursing homes; and
(2) may be modified, as appropriate, to reflect
changes in industry practice or changes made to the system used by
the Centers for Medicare and Medicaid Services.
(l) Sections 252.033(a), (b), (d), (f), and (h), Health and
Safety Code, are amended to read as follows:
(a) After receiving the application, the commission
[department] shall issue a license if, after inspection and
investigation, it finds that the applicant and facility meet the
requirements established under this chapter.
(b) The commission [department] may issue a license only
for:
(1) the premises and persons or governmental unit
named in the application; and
(2) the maximum number of beds specified in the
application.
(d) A license is renewable on the third [second] anniversary
of issuance or renewal of the license after:
(1) an inspection;
(2) filing and approval of a renewal report; and
(3) payment of the renewal fee.
(f) The commission [department] may not issue a license for
new beds or an expansion of an existing facility under this chapter
unless the addition of new beds or the expansion is included in the
plan approved by the commission in accordance with Section
533A.062.
(h) The executive commissioner by rule shall:
(1) define specific, appropriate, and objective
criteria on which the commission [department] may deny an initial
license application or license renewal or revoke a license; and
(2) adopt a system under which:
(A) licenses expire on staggered dates during
each three-year period; and
(B) the commission prorates the license fee as
appropriate if the expiration date of a license changes as a result
of the system adopted under Paragraph (A).
(m) Sections 252.034(a), (e), and (f), Health and Safety
Code, are amended to read as follows:
(a) The executive commissioner by rule may adopt a fee for a
license issued under this chapter. The fee may not exceed $225
[$150] plus $7.50 [$5] for each unit of capacity or bed space for
which the license is sought.
(e) All license fees collected under this section shall be
deposited in the state treasury to the credit of the commission
[department] and may be appropriated to the commission [department]
to administer and enforce this chapter.
(f) An applicant who submits an application for license
renewal later than the 45th day before the expiration date of a
current license is subject to a late fee in accordance with
commission [department] rules.
(n) Section 252.041, Health and Safety Code, is amended to
read as follows:
Sec. 252.041. UNANNOUNCED INSPECTIONS. (a) Each
licensing period, the commission [department] shall conduct at
least three [two] unannounced inspections of each facility.
(b) In order to ensure continuous compliance, the
commission [department] shall randomly select a sufficient
percentage of facilities for unannounced inspections to be
conducted between 5 p.m. and 8 a.m. Those inspections must be
cursory to avoid to the greatest extent feasible any disruption of
the residents.
(c) The commission [department] may require additional
inspections.
(d) As considered appropriate and necessary by the
commission [department], the commission [department] may invite at
least one person as a citizen advocate to participate in
inspections. The invited advocate must be an individual who has an
interest in or who is employed by or affiliated with an organization
or entity that represents, advocates for, or serves individuals
with an intellectual disability or a related condition.
(o) Section 252.065, Health and Safety Code, is amended by
amending Subsections (a), (b), (e), (f), (i), and (j) and adding
Subsections (l) and (m) to read as follows:
(a) The commission [department] may assess an
administrative penalty against a person who:
(1) violates this chapter or a rule, standard, or
order adopted or license issued under this chapter;
(2) makes a false statement, that the person knows or
should know is false, of a material fact:
(A) on an application for issuance or renewal of
a license or in an attachment to the application; or
(B) with respect to a matter under investigation
by the commission [department];
(3) refuses to allow a representative of the
commission [department] to inspect:
(A) a book, record, or file required to be
maintained by the institution; or
(B) any portion of the premises of an
institution;
(4) wilfully interferes with the work of a
representative of the commission [department] or the enforcement of
this chapter;
(5) wilfully interferes with a representative of the
commission [department] preserving evidence of a violation of this
chapter or a rule, standard, or order adopted or license issued
under this chapter;
(6) fails to pay a penalty assessed by the commission
[department] under this chapter not later than the 10th day after
the date the assessment of the penalty becomes final;
(7) fails to submit a plan of correction within 10 days
after receiving a statement of licensing violations; or
(8) fails to notify the commission [department] of a
change in ownership before the effective date of that change of
ownership.
(b) The penalty for a facility with fewer than 60 beds shall
be not less than $100 or more than $1,000 for each violation. The
penalty for a facility with 60 beds or more shall be not less than
$100 or more than $5,000 for each violation. [The total amount of
the penalty assessed for a violation continuing or occurring on
separate days under this subsection may not exceed $5,000 for a
facility with fewer than 60 beds or $25,000 for a facility with 60
beds or more.] Each day a violation occurs or continues is a
separate violation for purposes of imposing a penalty.
(e) The executive commissioner by rule shall provide the
facility with a reasonable period of time, not less than 45 days,
following the first day of a violation to correct the violation
before the commission [department] may assess an administrative
penalty if a plan of correction has been implemented. This
subsection does not apply to a violation described by Subsections
(a)(2)-(8) or to a violation that the commission [department]
determines:
(1) represents a pattern of violation that results
[has resulted] in actual [serious] harm [to or the death of a
resident];
(2) is widespread in scope and results in actual harm;
(3) is widespread in scope, constitutes a potential
for actual harm, and relates to:
(A) staff treatment of a resident;
(B) active treatment;
(C) client behavior and facility practices;
(D) health care services;
(E) drug administration;
(F) infection control;
(G) food and nutrition services; or
(H) emergency preparedness and response;
(4) [(2)] constitutes an immediate [a serious] threat
to the health or safety of a resident; or
(5) [(3)] substantially limits the facility's
[institution's] capacity to provide care.
(f) The commission [department] may not assess an
administrative penalty for a minor violation if the person corrects
the violation not later than the 46th day after the date the person
receives notice of the violation.
(i) The commission [department] may not assess an
administrative penalty against a state agency.
(j) Notwithstanding any other provision of this section, an
administrative penalty ceases to be incurred on the date a
violation is corrected. The administrative penalty ceases to be
incurred only if the facility:
(1) notifies the commission [department] in writing of
the correction of the violation and of the date the violation was
corrected; and
(2) shows later that the violation was corrected.
(l) The commission shall develop and use a system to record
and track the scope and severity of each violation of this chapter
or a rule, standard, or order adopted under this chapter for the
purpose of assessing an administrative penalty for the violation or
taking some other enforcement action against the appropriate
facility to deter future violations. The system:
(1) must be comparable to the system used by the
Centers for Medicare and Medicaid Services to categorize the scope
and severity of violations for nursing homes; and
(2) may be modified, as appropriate, to reflect
changes in industry practice or changes made to the system used by
the Centers for Medicare and Medicaid Services.
(m) In this section:
(1) "Actual harm" means a negative outcome that
compromises a resident's physical, mental, or emotional
well-being.
(2) "Immediate threat to the health or safety of a
resident" means a situation that causes, or is likely to cause,
serious injury, harm, or impairment to or the death of a resident.
(3) "Pattern of violation" means repeated, but not
pervasive, failures of a facility to comply with this chapter or a
rule, standard, or order adopted under this chapter that:
(A) result in a violation; and
(B) are found throughout the services provided by
the facility or that affect or involve the same residents or
facility employees.
(4) "Widespread in scope" means a violation of this
chapter or a rule, standard, or order adopted under this chapter
that:
(A) is pervasive throughout the services
provided by the facility; or
(B) affects or has the potential to affect a
large portion of or all of the residents of the facility.
(p) Section 103.003, Human Resources Code, is amended by
amending Subdivision (1) and adding Subdivisions (1-a) and (4-b) to
read as follows:
(1) "Commission" means the Health and Human Services
Commission.
(1-a) "Day activity and health services facility"
means a facility that provides services under a day activity and
health services program on a daily or regular basis but not
overnight to four or more elderly persons or persons with
disabilities who are not related by blood, marriage, or adoption to
the owner of the facility.
(4-b) "Facility" means a day activity and health
services facility.
(q) Sections 103.006(a) and (b), Human Resources Code, are
amended to read as follows:
(a) The commission [department] shall issue a license to
operate a day activity and health services facility to a person who
has met the application requirements and received approval after an
on-site inspection.
(b) The license expires three [two] years from the date of
its issuance. The executive commissioner by rule shall [may] adopt
a system under which licenses expire on staggered [various] dates
during the three-year [two-year] period. The commission shall
prorate the license fee as appropriate if the expiration date of a
license changes as a result of this subsection [For the year in
which a license expiration date is changed, the department shall
prorate the license fee on a monthly basis. Each license holder
shall pay only that portion of the license fee allocable to the
number of months for which the license is valid. A license holder
shall pay the total license renewal fee at the time of renewal].
(r) Section 103.007, Human Resources Code, is amended to
read as follows:
Sec. 103.007. LICENSE APPLICATION. (a) An applicant for a
license to operate a day activity and health services facility must
file an application on a form prescribed by the commission
[department] together with a license fee of $75 [$50].
(b) The applicant must provide evidence of:
(1) the ability to comply with the requirements of the
commission [department];
(2) responsible management; and
(3) qualified professional staff and personnel.
(c) A person who operates a facility that is licensed under
this chapter must file an application for a renewal license not
later than the 45th day before the expiration date of the current
license on a form prescribed by the commission [department]
together with a renewal fee of $50.
(d) An applicant for a license renewal who submits an
application later than the 45th day before the expiration date of
the license is subject to a late fee in accordance with commission
[department] rules.
(s) Section 103.008, Human Resources Code, is amended to
read as follows:
Sec. 103.008. INSPECTIONS. (a) In addition to the
inspection required under Section 103.006(a), the commission:
(1) shall inspect each facility every two years
following the initial inspection required under Section
103.006(a); and
(2) [The department] may inspect [enter the premises
of] a facility at other reasonable times as [and make an inspection]
necessary to ensure compliance with this chapter [issue a license
or renew a license].
(b) Any person may request an inspection of a facility by
notifying the commission [department] in writing of an alleged
violation of a licensing requirement. The complaint shall be as
detailed as possible and signed by the complainant. The commission
[department] shall perform an on-site inspection as soon as
feasible but no later than 30 days after receiving the complaint
unless after an investigation the complaint is found to be
frivolous. The commission [department] shall respond to a
complainant in writing. The commission [department] shall also
receive and investigate anonymous complaints.
(t) Section 103.012, Human Resources Code, is amended by
amending Subsections (a) and (e) and adding Subsection (g) to read
as follows:
(a) The commission [department] may assess an
administrative penalty against a person who:
(1) violates this chapter, a rule, standard, or order
adopted under this chapter, or a term of a license issued under this
chapter;
(2) makes a false statement of a material fact that the
person knows or should know is false:
(A) on an application for issuance or renewal of
a license or in an attachment to the application; or
(B) with respect to a matter under investigation
by the commission [department];
(3) refuses to allow a representative of the
commission [department] to inspect:
(A) a book, record, or file required to be
maintained by a day activity and health services facility; or
(B) any portion of the premises of a day activity
and health services facility;
(4) wilfully interferes with the work of a
representative of the commission [department] or the enforcement of
this chapter;
(5) wilfully interferes with a representative of the
commission [department] preserving evidence of a violation of this
chapter, a rule, standard, or order adopted under this chapter, or a
term of a license issued under this chapter;
(6) fails to pay a penalty assessed under this chapter
not later than the 30th day after the date the assessment of the
penalty becomes final; or
(7) fails to notify the commission [department] of a
change of ownership before the effective date of the change of
ownership.
(e) In determining the amount of a penalty, the commission
[department] shall consider any matter that justice may require,
including:
(1) the gradations of penalties established under
Subsection (d);
(2) the seriousness of the violation, including the
nature, circumstances, extent, and gravity of the prohibited act
and the hazard or potential hazard created by the act to the health
or safety of the public;
(3) the history of previous violations;
(4) the deterrence of future violations; and
(5) the efforts to correct the violation.
(g) The commission shall develop and use a system to record
and track the scope and severity of each violation of this chapter
or a rule, standard, or order adopted under this chapter for the
purpose of assessing an administrative penalty for the violation or
taking some other enforcement action against the appropriate
facility to deter future violations. The system:
(1) must be comparable to the system used by the
Centers for Medicare and Medicaid Services to categorize the scope
and severity of violations for nursing homes; and
(2) may be modified, as appropriate, to reflect
changes in industry practice or changes made to the system used by
the Centers for Medicare and Medicaid Services.
(u) Section 103.013, Human Resources Code, is amended to
read as follows:
Sec. 103.013. RIGHT TO CORRECT BEFORE IMPOSITION OF
ADMINISTRATIVE PENALTY. (a) The commission [department] may not
collect an administrative penalty from a day activity and health
services facility under Section 103.012 if, not later than the 45th
day after the date the facility receives notice under Section
103.014(c), the facility corrects the violation.
(b) Subsection (a) does not apply to:
(1) a violation that the commission [department]
determines:
(A) represents a pattern of violation that
results in actual [serious] harm [to or death of a person attending
the facility];
(B) is widespread in scope and results in actual
harm;
(C) is widespread in scope, constitutes a
potential for actual harm, and relates to:
(i) staffing, including staff training,
ratio, and health;
(ii) administration of medication; or
(iii) emergency preparedness and response;
(D) [(B)] constitutes an immediate [a serious]
threat to the health or [and] safety of an elderly person or a
person with a disability receiving services at a [a person
attending the] facility; or
(E) [(C)] substantially limits the facility's
capacity to provide care;
(2) a violation described by Sections
103.012(a)(2)-(7); or
(3) a violation of Section 103.011.
(c) A day activity and health services facility that
corrects a violation must maintain the correction. If the facility
fails to maintain the correction until at least the first
anniversary after the date the correction was made, the commission
[department] may assess and collect an administrative penalty for
the subsequent violation. An administrative penalty assessed under
this subsection is equal to three times the amount of the original
penalty assessed but not collected. The commission [department] is
not required to provide the facility with an opportunity under this
section to correct the subsequent violation.
(d) In this section:
(1) "Actual harm" means a negative outcome that
compromises the physical, mental, or emotional well-being of an
elderly person or a person with a disability receiving services at a
facility.
(2) "Immediate threat to the health or safety of an
elderly person or a person with a disability" means a situation that
causes, or is likely to cause, serious injury, harm, or impairment
to or the death of an elderly person or a person with a disability
receiving services at a facility.
(3) "Pattern of violation" means repeated, but not
pervasive, failures of a facility to comply with this chapter or a
rule, standard, or order adopted under this chapter that:
(A) result in a violation; and
(B) are found throughout the services provided by
the facility or that affect or involve the same elderly persons or
persons with disabilities receiving services at the facility or the
same facility employees.
(4) "Widespread in scope" means a violation of this
chapter or a rule, standard, or order adopted under this chapter
that:
(A) is pervasive throughout the services
provided by the facility; or
(B) represents a systemic failure by the facility
that affects or has the potential to affect a large portion of or
all of the elderly persons or persons with disabilities receiving
services at the facility.
(v) Section 247.0025, Health and Safety Code, is repealed.
(w) The changes in law made by this section apply only to
actions taken by the Health and Human Services Commission and
license holders under Chapter 103, Human Resources Code, and
Chapters 242, 247, 248A, and 252, Health and Safety Code, on or
after the effective date of this section. An action taken before
the effective date of this section is governed by the law in effect
at that time, and the former law is continued in effect for that
purpose.
(x) This section takes effect September 1, 2017.
SECTION 3. (a) As soon as practicable after the effective
date of this Act, the executive commissioner of the Health and Human
Services Commission shall:
(1) adopt the rules necessary to implement Subchapter
P, Chapter 242, Health and Safety Code, as added by this Act; and
(2) notwithstanding Section 242.703, Health and
Safety Code, as added by this Act, establish the amount of the
initial reinvestment allowance imposed under Subchapter P, Chapter
242, Health and Safety Code, as added by this Act, based on
available revenue and patient day information.
(b) The amount of the initial reinvestment allowance
established under Subsection (a) of this section remains in effect
until the Health and Human Services Commission obtains the
information necessary to set the amount of the reinvestment
allowance under Section 242.703, Health and Safety Code, as added
by this Act.
SECTION 4. If before implementing any provision of this Act
a state agency determines that a waiver or authorization from a
federal agency is necessary for implementation of that provision,
the agency affected by the provision shall request the waiver or
authorization and may delay implementing that provision until the
waiver or authorization is granted.
SECTION 5. Notwithstanding any other law, a reinvestment
allowance may not be imposed under Section 242.703, Health and
Safety Code, as added by this Act, or collected under Section
242.705, Health and Safety Code, as added by this Act, until:
(1) an amendment to the state Medicaid plan that
increases the rates paid to long-term care facilities licensed
under Chapter 242, Health and Safety Code, for providing services
under the state Medicaid program is approved by the Centers for
Medicare and Medicaid Services or another applicable federal
government agency; and
(2) the executive commissioner of the Health and Human
Services Commission certifies to the Legislative Budget Board that
the imposition and collection of a reinvestment allowance will not
negatively impact the budget neutrality requirement of a waiver
under Section 1115 of the federal Social Security Act (42 U.S.C.
Section 1315) agreed to by the commission and the Centers for
Medicare and Medicaid Services.
SECTION 6. The Health and Human Services Commission shall
retroactively compensate long-term care facilities licensed under
Chapter 242, Health and Safety Code, at the increased rate for
services provided under the state Medicaid program:
(1) beginning on the date the state Medicaid plan
amendment is approved by the Centers for Medicare and Medicaid
Services or another applicable federal government agency; and
(2) only for the period for which the reinvestment
allowance has been imposed and collected pursuant to the approval
described by Subdivision (1).
SECTION 7. The Health and Human Services Commission shall
discontinue the reinvestment allowance imposed under Subchapter P,
Chapter 242, Health and Safety Code, as added by this Act, if the
commission reduces Medicaid reimbursement rates, including rates
that increased due to funds from the nursing facility reinvestment
allowance trust fund or federal matching funds, below the rates in
effect on September 1, 2017.
SECTION 8. 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, 2017.
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