Texas 2023 - 88th Regular

Texas Senate Bill SB2332 Compare Versions

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1	1	88R8186 SRA-F
2	2	By: Kolkhorst S.B. No. 2332
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the operations of hospital districts in counties with a
8	8	population of at least 190,000 persons.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 281.021(d), Health and Safety Code, is
11	11	amended to read as follows:
12	12	(d) If a district is created under this chapter in a county
13	13	with a population of more than 1.2 million [800,000] that was not
14	14	included in the boundaries of a hospital district before September
15	15	1, 2003, the district shall be governed by a nine-member board of
16	16	hospital managers, appointed by [as follows:
17	17	[(1)] the commissioners court of the county [shall
18	18	appoint four members;
19	19	[(2) the governing body of the municipality with the
20	20	largest population in the county shall appoint four members; and
21	21	[(3) the commissioners court and the governing body of
22	22	the municipality described by Subdivision (2) shall jointly appoint
23	23	one member].
24	24	SECTION 2. Section 281.022(c), Health and Safety Code, is
25	25	amended to read as follows:
26	26	(c) A member [The members] of a board of hospital managers
27	27	appointed under Section 281.021(d) may not serve more than a total
28	28	of eight years on the board [serve staggered four-year terms, with
29	29	as near as possible to one-fourth of the members' terms expiring
30	30	each year. The terms of the members appointed under that section
31	31	are as follows:
32	32	[(1) the members appointed solely by the governing
33	33	body of the municipality with the largest population in the county
34	34	shall draw lots to determine which member serves a one-year term,
35	35	which member serves a two-year term, which member serves a
36	36	three-year term, and which member serves a four-year term;
37	37	[(2) the members appointed solely by the commissioners
38	38	court of the county shall draw lots to determine which member serves
39	39	a one-year term, which member serves a two-year term, which member
40	40	serves a three-year term, and which member serves a four-year term;
41	41	and
42	42	[(3) the member appointed jointly by the governing
43	43	body of the municipality described by Subdivision (1) and the
44	44	commissioners court serves a four-year term].
45	45	SECTION 3. Subchapter B, Chapter 281, Health and Safety
46	46	Code, is amended by adding Section 281.0221 to read as follows:
47	47	Sec. 281.0221. QUALIFICATIONS FOR SERVICE ON BOARD. (a) A
48	48	person may not serve on the board of hospital managers for a
49	49	district if the person:
50	50	(1) has not resided in the boundaries of the district
51	51	for at least three years preceding the date of the person's
52	52	appointment;
53	53	(2) is an employee of the district, or is related to an
54	54	employee of the district within two degrees of consanguinity or
55	55	affinity as determined under Chapter 573, Government Code;
56	56	(3) has served in a public elective office during any
57	57	of the four years preceding the date of the person's appointment; or
58	58	(4) is an employee or contractor of a vendor having a
59	59	contract the price of which is more than $250,000 with:
60	60	(A) the district; or
61	61	(B) any entity created by or affiliated with the
62	62	district.
63	63	(b) At least half of the members of the board of hospital
64	64	managers for a district serving at any one time must have at least
65	65	four years of work experience:
66	66	(1) in a hospital or other health care facility or as a
67	67	licensed health professional;
68	68	(2) in the financial services industry or accounting
69	69	profession or as a licensed financial professional, including a
70	70	certified public accountant or financial services advisor; or
71	71	(3) as an attorney licensed to practice law in this
72	72	state.
73	73	(c) Not more than one third of the members of the board of
74	74	hospital managers for a district serving at any one time may derive
75	75	more than 10 percent of their annual income from the health care
76	76	industry.
77	77	(d) Except as otherwise provided by this subsection, at
78	78	least one member of the board of hospital managers for a district
79	79	must be an indigent patient that has been served by the district or
80	80	a person who is related to an indigent patient that has been served
81	81	by the district within two degrees of consanguinity, as determined
82	82	under Chapter 573, Government Code. A board member described by
83	83	this subsection must represent the demographic factors of indigent
84	84	individuals generally served by the district, including geography,
85	85	race, ethnicity, and gender. This subsection does not apply to the
86	86	initial appointed board of hospital managers for a district.
87	87	SECTION 4. The heading to Section 281.0222, Health and
88	88	Safety Code, is amended to read as follows:
89	89	Sec. 281.0222. QUALIFICATIONS FOR OFFICE IN CERTAIN
90	90	DISTRICTS.
91	91	SECTION 5. Section 281.0222, Health and Safety Code, is
92	92	amended by adding Subsection (c) to read as follows:
93	93	(c) In the event of a conflict between Section 281.0221 and
94	94	this section, Section 281.0221 controls.
95	95	SECTION 6. Subchapter B, Chapter 281, Health and Safety
96	96	Code, is amended by adding Section 281.0223 to read as follows:
97	97	Sec. 281.0223. STANDARDS OF CONDUCT; CONFLICTS OF INTEREST;
98	98	RECUSAL. (a) A member of the board of hospital managers for a
99	99	district is subject to the conflict of interest and other
100	100	provisions applicable to the conduct of an appointed officer under
101	101	Chapter 572, Government Code.
102	102	(b) A member of the board of hospital managers for a
103	103	district shall recuse himself or herself from participating in the
104	104	deliberation regarding or voting on any district contract:
105	105	(1) involving the board member's employer as a
106	106	contractor or subcontractor; or
107	107	(2) in which the board member or the board member's
108	108	employer has a substantial interest as described by Section
109	109	572.005, Government Code.
110	110	SECTION 7. Section 281.031(a), Health and Safety Code, is
111	111	amended to read as follows:
112	112	(a) A member of the board of hospital managers of the El Paso
113	113	County Hospital District is considered to have resigned the
114	114	member's position if the member:
115	115	(1) is absent from all the regularly scheduled board
116	116	and committee meetings that the member is eligible to attend during
117	117	a 90-day period;
118	118	(2) is absent from more than half of the regularly
119	119	scheduled board and committee meetings that the member is eligible
120	120	to attend during a 12-month period;
121	121	(3) fails to pay a local tax, including an ad valorem
122	122	tax, when due; or
123	123	(4) would be ineligible to serve on the board as
124	124	provided by Section 281.0221 or 281.0222.
125	125	SECTION 8. Section 281.045(a), Health and Safety Code, is
126	126	amended to read as follows:
127	127	(a) On or after the creation of the district, the county or a
128	128	municipality located in the district may not levy taxes for
129	129	hospital purposes or to provide the services described by Section
130	130	61.028 or 61.0285. This subsection may not be construed to restrict
131	131	the ability of a county or municipality located in the district to
132	132	levy taxes for essential public health services, as that term is
133	133	defined by Section 121.002.
134	134	SECTION 9. Section 281.046, Health and Safety Code, is
135	135	amended to read as follows:
136	136	Sec. 281.046. DISTRICT RESPONSIBILITY FOR MEDICAL AID AND
137	137	HOSPITAL CARE. Beginning on the date on which taxes are collected
138	138	for the district, the district assumes full responsibility for
139	139	furnishing medical and hospital care, including the services
140	140	described by Sections 61.028 and 61.0285, for indigent and needy
141	141	persons residing in the district.
142	142	SECTION 10. Section 281.048, Health and Safety Code, is
143	143	amended to read as follows:
144	144	Sec. 281.048. DISTRICT RULES. Subject to any applicable
145	145	restriction provided by law, the [The] board may adopt rules
146	146	governing the operation of the hospital or hospital system.
147	147	SECTION 11. Section 281.049, Health and Safety Code, is
148	148	amended by amending Subsections (a) and (c) and adding Subsection
149	149	(e) to read as follows:
150	150	(a) The commissioners court shall [may] prescribe policies
151	151	and procedures to ensure efficiency, fiscal accountability,
152	152	financial controls, and transparency. The policies and procedures
153	153	must include:
154	154	(1) the method of making purchases and expenditures by
155	155	and for the district; and
156	156	(2) accounting and control procedures for the district
157	157	that ensure that district revenue is spent:
158	158	(A) in accordance with all applicable provisions
159	159	of law; and
160	160	(B) in a manner that is transparent to the
161	161	residents of the district.
162	162	(c) A county officer, employee, contractor, or agent shall
163	163	perform any function or service ordered [required] by the
164	164	commissioners court under this section.
165	165	(e) At least once every five years, the commissioners court
166	166	shall contract with an independent auditor to have performed a
167	167	comprehensive performance audit of the district's management,
168	168	accounting, financial controls, recordkeeping, and compliance with
169	169	applicable law. The audit must assess the performance of the
170	170	district and the district's vendors and determine whether the
171	171	district's management adheres to best practices and national
172	172	standards applicable to the administration of hospitals and
173	173	hospital systems. The auditor shall produce a written report
174	174	identifying any identified issues and recommendations to the
175	175	commissioners court and provide a copy of the report to the district
176	176	and the commissioners court. The district shall post the report in
177	177	a conspicuous location on the district's publicly accessible
178	178	Internet website. The commissioners court shall hold a public
179	179	hearing on the report.
180	180	SECTION 12. Section 281.051, Health and Safety Code, is
181	181	amended by adding Subsections (d) and (e) to read as follows:
182	182	(d) A contract entered into under this section:
183	183	(1) must be for fair and reasonable compensation;
184	184	(2) is subject to all legal restrictions on the use of
185	185	district money; and
186	186	(3) must include provisions that require district
187	187	money received by a party to the contract to be:
188	188	(A) subject to appropriate recordkeeping,
189	189	financial accounting, and financial control practices; and
190	190	(B) held in a separate account from other money
191	191	held by the party.
192	192	(e) Records of expenditures of district money and the
193	193	purposes of those expenditures are subject to Chapter 552,
194	194	Government Code.
195	195	SECTION 13. Section 281.053, Health and Safety Code, is
196	196	amended to read as follows:
197	197	Sec. 281.053. DISTRICT INSPECTIONS. (a) The district, or
198	198	the district's contractors or subcontractors, may be inspected by
199	199	an employee, agent, contractor, or [a] representative of the
200	200	commissioners court or the Department of State Health Services.
201	201	(b) A person subject to inspection under Subsection (a)
202	202	[district officer] shall:
203	203	(1) admit an inspector into the person's [district]
204	204	facilities to the extent those facilities relate to the district or
205	205	services provided to the district; and
206	206	(2) on demand give the inspector full access to
207	207	records, reports, books, papers, and accounts related to the
208	208	district, including, if applicable, records, reports, books,
209	209	papers, and accounts related to expenditures made with district
210	210	money received under a contract with the district.
211	211	(c) The district or commissioners court may terminate the
212	212	contract of a district vendor that fails to comply with this
213	213	section.
214	214	SECTION 14. Section 281.056, Health and Safety Code, is
215	215	amended by amending Subsection (b-1) and adding Subsection (e) to
216	216	read as follows:
217	217	(b-1) The county attorney, district attorney, or criminal
218	218	district attorney, as appropriate, with the duty to represent the
219	219	county in civil matters shall, in all legal matters, represent a
220	220	district located in:
221	221	(1) a county with a population of 800,000 or more that
222	222	borders the United Mexican States; or
223	223	(2) a county with a population of 3.4 million or more[;
224	224	or
225	225	[(3) a county with a population of more than 800,000
226	226	that was not included in the boundaries of a hospital district
227	227	before September 1, 2003].
228	228	(e) The county attorney, district attorney, or criminal
229	229	district attorney, as appropriate, with the duty to represent a
230	230	county in civil matters may not advise both the commissioners court
231	231	of the county and a district located in the county if there is a
232	232	potential conflict of interest between the county and the district.
233	233	The limitation provided by this subsection applies to advice
234	234	relating to the authority of the commissioners court to supervise
235	235	and oversee the district. The commissioners court shall hire
236	236	private legal counsel if there is a potential conflict of interest.
237	237	The county is responsible for the fee charged by private legal
238	238	counsel hired by the commissioners court under this subsection.
239	239	SECTION 15. Section 281.0565, Health and Safety Code, is
240	240	amended by amending Subsections (a), (b), (c), and (d) and adding
241	241	Subsections (g) and (h) to read as follows:
242	242	(a) In this section, "charitable organization" means an
243	243	organization that is exempt from federal income tax under Section
244	244	501(a) of the Internal Revenue Code of 1986 by being listed as an
245	245	exempt organization in Section 501(c)(3) [or 501(c)(4)] of that
246	246	[the] code.
247	247	(b) For the purpose of providing medical and hospital care
248	248	for the district's indigent residents, a [A] district may create a
249	249	charitable organization to facilitate the management of a district
250	250	health care program by providing or arranging health care services,
251	251	developing resources for health care services, or providing
252	252	ancillary support services for the district. The district is
253	253	responsible for the actions of a charitable organization created by
254	254	the district.
255	255	(c) A charitable organization created by a district under
256	256	this section is a unit of local government only for purposes of
257	257	Chapter 101, Civil Practice and Remedies Code. The charitable
258	258	organization is subject to Chapters 551 and 552, Government Code.
259	259	(d) For the purpose of providing medical and hospital care
260	260	for the district's indigent residents, a [A] district may make a
261	261	reasonable and necessary capital or other financial contribution to
262	262	a charitable organization created by the district to provide
263	263	regional administration and delivery of health care services to or
264	264	for the district.
265	265	(g) A charitable organization contract:
266	266	(1) is subject to all legal restrictions on the use of
267	267	district money; and
268	268	(2) must include standard requirements for
269	269	recordkeeping, financial accounting, and financial control
270	270	practices relating to district money.
271	271	(h) A charitable organization shall hold district money in a
272	272	separate account from other money held by the organization.
273	273	SECTION 16. Section 281.073(a), Health and Safety Code, is
274	274	amended to read as follows:
275	275	(a) The recordkeeping, preservation, microfilming,
276	276	destruction, or other disposition of the records of a district is
277	277	subject to all requirements applicable to a local government under
278	278	Subtitle C, Title 6, Local Government Code.
279	279	SECTION 17. Section 281.091, Health and Safety Code, is
280	280	amended to read as follows:
281	281	Sec. 281.091. BUDGET. (a) The administrator shall prepare
282	282	a comprehensive, detailed [an] annual budget under the board's
283	283	direction.
284	284	(b) The budget and budget revisions must be approved by the
285	285	board and then shall be presented to the commissioners court for
286	286	final approval. The commissioners court may approve the budget in
287	287	its entirety or may approve only a portion of the budget.
288	288	SECTION 18. Section 281.092, Health and Safety Code, is
289	289	amended by amending Subsection (b) and adding Subsections (c), (d),
290	290	and (e) to read as follows:
291	291	(b) The report must:
292	292	(1) consist of a sworn statement of all assets,
293	293	liabilities, obligations, money, and property rights [choses in
294	294	action] received by the administrator, the district, and, if
295	295	applicable, a charitable organization created by the district or
296	296	any another organization affiliated with the district, and their
297	297	disposition; and
298	298	(2) show in detail the operations of the district for
299	299	the fiscal year, including the revenue received and expenditures
300	300	made by the district in that fiscal year, in a manner that is clear
301	301	and concise and posted on the district's publicly accessible
302	302	Internet website or in an annual report posted on the district's
303	303	publicly accessible Internet website.
304	304	(c) In a manner consistent with federal and state privacy
305	305	laws, the administrator in the report required by Subsection (a)
306	306	shall list the medical services provided to individuals who qualify
307	307	as indigent, the actual cost of those services, and the provider of
308	308	the services, if the cost of the services was paid under a contract
309	309	with the district.
310	310	(d) The commissioners court shall review in a public hearing
311	311	the information reported under Subsection (c) and evaluate the
312	312	district's performance in providing medical and hospital care to
313	313	indigent residents of the district.
314	314	(e) The commissioners court may request at any time more
315	315	detailed information on an issue contained in or related to the
316	316	report and the district shall promptly provide the requested
317	317	information.
318	318	SECTION 19. Section 281.093(d), Health and Safety Code, is
319	319	amended to read as follows:
320	320	(d) All income of the district shall be deposited in the
321	321	district depository. Income attributable to taxes imposed by the
322	322	district must be kept in a separate account.
323	323	SECTION 20. Section 281.095(a), Health and Safety Code, is
324	324	amended to read as follows:
325	325	(a) In this section, "district" means the Bexar County
326	326	Hospital District, Nueces County Hospital District, El Paso County
327	327	Hospital District, or Harris County Hospital District. The term
328	328	includes a district to which Section 281.0475 applies.
329	329	SECTION 21. Subchapter E, Chapter 281, Health and Safety
330	330	Code, is amended by adding Sections 281.097 and 281.098 to read as
331	331	follows:
332	332	Sec. 281.097. USE OF DISTRICT TAX REVENUE. (a) Taxes
333	333	levied by a district and any money derived from those taxes,
334	334	including interest or other earnings, may be used only to provide
335	335	medical and hospital care for indigent and needy persons residing
336	336	in the district and to pay the costs described by Subsection (b).
337	337	(b) A district may use its tax levy to pay the reasonable and
338	338	necessary costs of:
339	339	(1) providing health care and health care support
340	340	services at teaching hospitals by physicians and resident
341	341	physicians if teaching physicians are physically present to provide
342	342	the service to the patient;
343	343	(2) administering and providing health services,
344	344	whether through the direct provision of services or as a payor; and
345	345	(3) providing necessary clinical patient education,
346	346	mental health services, and social work services, including primary
347	347	and preventative care.
348	348	(c) The district administrator, board of hospital managers
349	349	for the district, and commissioners court shall ensure compliance
350	350	with this section.
351	351	Sec. 281.098. MATCHING FEDERAL FUNDS FOR MENTAL HEALTH
352	352	CARE. This chapter may not be construed to prevent a district from
353	353	using district revenue to provide for the nonfederal share of
354	354	Medicaid payments for any reimbursement to a hospital for which
355	355	federal matching funds are available for mental health services
356	356	provided to the residents of the district.
357	357	SECTION 22. The following provisions of the Health and
358	358	Safety Code are repealed:
359	359	(1) Section 281.049(b);
360	360	(2) Section 281.0511; and
361	361	(3) Section 281.0565(e).
362	362	SECTION 23. Sections 281.022 and 281.0222, Health and
363	363	Safety Code, as amended by this Act, and Section 281.0221, Health
364	364	and Safety Code, as added by this Act, do not affect the entitlement
365	365	of a member serving on the board of managers of a hospital district
366	366	subject to those sections immediately before the effective date of
367	367	this Act to continue to serve for the remainder of the member's
368	368	term. As the terms of members expire, the appropriate
369	369	commissioners court shall appoint or reappoint members who have the
370	370	terms and qualifications required by Sections 281.022, 281.0221,
371	371	and 281.0222, Health and Safety Code, as applicable.
372	372	SECTION 24. The changes in law made by this Act with respect
373	373	to a contract or agreement, including an agreement under Chapter
374	374	311, Tax Code, apply only to a contract or agreement entered into on
375	375	or after the effective date of this Act. A contract or agreement
376	376	entered into before the effective date of this Act is governed by
377	377	the law in effect immediately before the effective date of this Act,
378	378	and the former law is continued in effect for that purpose.
379	379	SECTION 25. This Act takes effect September 1, 2023.