Texas 2025 - 89th Regular

Texas House Bill HB891 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	89R384 MM-F
2	2	By: Lalani H.B. No. 891
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7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to a "Texas solution" to reforming and addressing issues
10	10	related to the Medicaid program, including the creation of an
11	11	alternative program designed to ensure health benefit plan coverage
12	12	to certain low-income individuals through the private marketplace;
13	13	requiring a fee.
14	14	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
15	15	ARTICLE 1. BLOCK GRANT FUNDING SYSTEM FOR STATE MEDICAID PROGRAM
16	16	SECTION 1.01. Subtitle I, Title 4, Government Code, is
17	17	amended by adding Chapter 532A to read as follows:
18	18	CHAPTER 532A. BLOCK GRANT FUNDING SYSTEM FOR STATE MEDICAID
19	19	PROGRAM
20	20	SUBCHAPTER A. GENERAL PROVISIONS
21	21	Sec. 532A.0001. DEFINITIONS. Notwithstanding Section
22	22	521.0001, in this chapter:
23	23	(1) "Health benefit exchange" means an American Health
24	24	Benefit Exchange administered by the federal government or an
25	25	exchange created under Section 1311(b) of the Patient Protection
26	26	and Affordable Care Act (42 U.S.C. Section 18031(b)).
27	27	(2) "Medicaid program" means the medical assistance
28	28	program established and operated under Title XIX, Social Security
29	29	Act (42 U.S.C. Section 1396 et seq.).
30	30	(3) "State Medicaid program" means the medical
31	31	assistance program provided by this state under the Medicaid
32	32	program.
33	33	Sec. 532A.0002. FEDERAL AUTHORIZATION TO REFORM MEDICAID
34	34	REQUIRED. If the federal government establishes, through
35	35	conversion or otherwise, a block grant funding system for the
36	36	Medicaid program or otherwise authorizes the state Medicaid program
37	37	to operate under a block grant funding system, including under a
38	38	Medicaid program waiver, the commission, in cooperation with
39	39	applicable health and human services agencies, shall, subject to
40	40	Section 532A.0003, administer and operate the state Medicaid
41	41	program in accordance with this chapter.
42	42	Sec. 532A.0003. CONFLICT WITH OTHER LAW. To the extent of a
43	43	conflict between a provision of this chapter and:
44	44	(1) another provision of state law, the provision of
45	45	this chapter controls, subject to Section 545A.0002(b); and
46	46	(2) a provision of federal law or any authorization
47	47	described under Section 532A.0002, the federal law or authorization
48	48	controls.
49	49	Sec. 532A.0004. ESTABLISHMENT OF REFORMED STATE MEDICAID
50	50	PROGRAM. The commission shall establish a state Medicaid program
51	51	that provides benefits under a risk-based Medicaid managed care
52	52	model.
53	53	Sec. 532A.0005. RULES. The executive commissioner shall
54	54	adopt rules necessary to implement this chapter.
55	55	SUBCHAPTER B. ACUTE CARE
56	56	Sec. 532A.0051. ELIGIBILITY FOR MEDICAID ACUTE CARE. (a)
57	57	An individual is eligible to receive acute care benefits under the
58	58	state Medicaid program if the individual:
59	59	(1) has a household income at or below 100 percent of
60	60	the federal poverty level;
61	61	(2) is under 19 years of age and:
62	62	(A) is receiving Supplemental Security Income
63	63	(SSI) under 42 U.S.C. Section 1381 et seq.; or
64	64	(B) is in foster care or resides in another
65	65	residential care setting under the conservatorship of the
66	66	Department of Family and Protective Services; or
67	67	(3) meets the eligibility requirements that were in
68	68	effect in this state on August 31, 2025.
69	69	(b) The commission shall provide acute care benefits under
70	70	the state Medicaid program to each individual eligible under this
71	71	section through the most cost-effective means, as determined by the
72	72	commission.
73	73	(c) If an individual is not eligible for the state Medicaid
74	74	program under Subsection (a), the commission shall refer the
75	75	individual to the program established under Chapter 545A that helps
76	76	connect eligible residents with health benefit plan coverage
77	77	through private market solutions, a health benefit exchange, or any
78	78	other resource the commission determines appropriate.
79	79	Sec. 532A.0052. MEDICAID SLIDING SCALE SUBSIDIES. (a) An
80	80	individual who is eligible for the state Medicaid program under
81	81	Section 532A.0051 may receive a Medicaid sliding scale subsidy to
82	82	purchase a health benefit plan from an authorized health benefit
83	83	plan issuer.
84	84	(b) A sliding scale subsidy provided to an individual under
85	85	this section must:
86	86	(1) be based on:
87	87	(A) the average premium in the market; and
88	88	(B) a realistic assessment of the individual's
89	89	ability to pay a portion of the premium; and
90	90	(2) include an enhancement for individuals who choose
91	91	a high deductible health plan with a health savings account.
92	92	(c) The commission shall ensure that counselors are made
93	93	available to individuals receiving a subsidy to advise the
94	94	individuals on selecting a health benefit plan that meets the
95	95	individuals' needs.
96	96	(d) An individual receiving a subsidy under this section is
97	97	responsible for paying:
98	98	(1) any difference between the premium costs
99	99	associated with the purchase of a health benefit plan and the amount
100	100	of the individual's subsidy under this section; and
101	101	(2) any copayments associated with the health benefit
102	102	plan, except to the extent the individual receives an additional
103	103	subsidy under Section 532A.0053 to pay the copayments.
104	104	(e) If the amount of a subsidy received by an individual
105	105	under this section exceeds the premium costs associated with the
106	106	individual's purchase of a health benefit plan, the individual may
107	107	deposit the excess amount in a health savings account that may be
108	108	used only in the manner described by Section 532A.0054(b).
109	109	Sec. 532A.0053. ADDITIONAL COST-SHARING SUBSIDIES. In
110	110	addition to providing a subsidy to an individual under Section
111	111	532A.0052, the commission shall provide additional subsidies for
112	112	coinsurance payments, copayments, deductibles, and other
113	113	cost-sharing requirements associated with the individual's health
114	114	benefit plan. The commission shall provide the additional
115	115	subsidies on a sliding scale based on income.
116	116	Sec. 532A.0054. DELIVERY OF SUBSIDIES; HEALTH SAVINGS
117	117	ACCOUNTS. (a) The commission shall determine the most appropriate
118	118	manner for delivering and administering subsidies provided under
119	119	Sections 532A.0052 and 532A.0053. In determining the most
120	120	appropriate manner, the commission shall consider depositing
121	121	subsidy amounts for an individual in a health savings account
122	122	established for that individual.
123	123	(b) A health savings account established under this section
124	124	may be used only to:
125	125	(1) pay health benefit plan premiums and cost-sharing
126	126	amounts; and
127	127	(2) if appropriate, purchase health care-related
128	128	goods and services.
129	129	Sec. 532A.0055. MEDICAID HEALTH BENEFIT PLAN ISSUERS AND
130	130	MINIMUM COVERAGE. The commission shall allow any health benefit
131	131	plan issuer authorized to write health benefit plans in this state
132	132	to participate in the state Medicaid program. The commission in
133	133	consultation with the commissioner of insurance shall establish
134	134	minimum coverage requirements for a health benefit plan to be
135	135	eligible for purchase under the state Medicaid program, subject to
136	136	the requirements specified by this chapter.
137	137	Sec. 532A.0056. REINSURANCE FOR PARTICIPATING HEALTH
138	138	BENEFIT PLAN ISSUERS. (a) The commission in consultation with the
139	139	commissioner of insurance shall study a reinsurance program to
140	140	reinsure participating health benefit plan issuers.
141	141	(b) In examining options for a reinsurance program, the
142	142	commission and the commissioner of insurance shall consider a plan
143	143	design under which:
144	144	(1) a participating health benefit plan is not charged
145	145	a premium for the reinsurance; and
146	146	(2) the health benefit plan issuer retains risk on a
147	147	sliding scale.
148	148	SUBCHAPTER C. LONG-TERM SERVICES AND SUPPORTS
149	149	Sec. 532A.0101. PLAN TO REFORM DELIVERY OF LONG-TERM
150	150	SERVICES AND SUPPORTS. The commission shall develop a
151	151	comprehensive plan to reform the delivery of long-term services and
152	152	supports that is designed to achieve the following objectives under
153	153	the state Medicaid program or any other program created as an
154	154	alternative to the state Medicaid program:
155	155	(1) encourage consumer direction;
156	156	(2) simplify and streamline the provision of services;
157	157	(3) provide flexibility to design benefits packages
158	158	that meet the needs of individuals receiving long-term services and
159	159	supports under the program;
160	160	(4) improve the cost-effectiveness and sustainability
161	161	of the provision of long-term services and supports;
162	162	(5) reduce reliance on institutional settings; and
163	163	(6) encourage cost-sharing by family members when
164	164	appropriate.
165	165	ARTICLE 2. IMMEDIATE REFORM: PROGRAM TO ENSURE HEALTH BENEFIT
166	166	COVERAGE FOR CERTAIN INDIVIDUALS THROUGH PRIVATE MARKETPLACE
167	167	SECTION 2.01. Subtitle I, Title 4, Government Code, is
168	168	amended by adding Chapter 545A to read as follows:
169	169	CHAPTER 545A. PROGRAM TO ENSURE HEALTH BENEFIT PLAN COVERAGE FOR
170	170	CERTAIN INDIVIDUALS THROUGH PRIVATE MARKET SOLUTIONS
171	171	SUBCHAPTER A. GENERAL PROVISIONS
172	172	Sec. 545A.0001. DEFINITION. In this chapter, "state
173	173	Medicaid program" has the meaning assigned by Section 532A.0001.
174	174	Sec. 545A.0002. CONFLICT WITH OTHER LAW. (a) Except as
175	175	provided by Subsection (b), to the extent of a conflict between a
176	176	provision of this chapter and:
177	177	(1) another provision of state law, the provision of
178	178	this chapter controls; and
179	179	(2) a provision of federal law or any authorization
180	180	described under Subchapter B, the federal law or authorization
181	181	controls.
182	182	(b) The program operated under this chapter is in addition
183	183	to the state Medicaid program operated under Chapter 32, Human
184	184	Resources Code, or under a block grant funding system under Chapter
185	185	532A.
186	186	Sec. 545A.0003. PROGRAM FOR HEALTH BENEFIT PLAN COVERAGE
187	187	THROUGH PRIVATE MARKET SOLUTIONS. Subject to the requirements of
188	188	this chapter, the commission in consultation with the commissioner
189	189	of insurance shall develop and implement a program that helps
190	190	connect certain low-income residents of this state with health
191	191	benefit plan coverage through private market solutions.
192	192	Sec. 545A.0004. NOT AN ENTITLEMENT. This chapter does not
193	193	establish an entitlement to assistance in obtaining health benefit
194	194	plan coverage.
195	195	Sec. 545A.0005. RULES. The executive commissioner shall
196	196	adopt rules necessary to implement this chapter.
197	197	SUBCHAPTER B. FEDERAL AUTHORIZATION
198	198	Sec. 545A.0051. FEDERAL AUTHORIZATION FOR FLEXIBILITY TO
199	199	ESTABLISH PROGRAM. (a) The commission in consultation with the
200	200	commissioner of insurance shall negotiate with the United States
201	201	secretary of health and human services, the Centers for Medicare
202	202	and Medicaid Services, and other appropriate persons for purposes
203	203	of seeking a waiver or other authorization necessary to obtain the
204	204	flexibility to use federal matching funds to help provide, in
205	205	accordance with Subchapter C, health benefit plan coverage to
206	206	certain low-income individuals through private market solutions.
207	207	(b) Any agreement reached under this section must:
208	208	(1) create a program that is made cost neutral to this
209	209	state by:
210	210	(A) leveraging premium tax revenues; and
211	211	(B) achieving cost savings through offsets to
212	212	general revenue health care costs or the implementation of other
213	213	cost savings mechanisms;
214	214	(2) create more efficient health benefit plan coverage
215	215	options for eligible individuals through:
216	216	(A) program changes that may be made without the
217	217	need for additional federal approval; and
218	218	(B) program changes that require additional
219	219	federal approval;
220	220	(3) require the commission to achieve efficiency and
221	221	reduce unnecessary utilization, including duplication, of health
222	222	care services;
223	223	(4) be designed with the goals of:
224	224	(A) relieving local tax burdens;
225	225	(B) reducing general revenue reliance so as to
226	226	make general revenue available for other state priorities; and
227	227	(C) minimizing the impact of any federal health
228	228	care laws on Texas-based businesses; and
229	229	(5) afford this state the opportunity to develop a
230	230	state-specific solution with benefits that specifically meet the
231	231	unique needs of this state's population.
232	232	(c) An agreement reached under this section may be:
233	233	(1) limited in duration; and
234	234	(2) contingent on continued funding by the federal
235	235	government.
236	236	SUBCHAPTER C. PROGRAM REQUIREMENTS
237	237	Sec. 545A.0101. ENROLLMENT ELIGIBILITY. (a) Subject to
238	238	Subsection (b), an individual may be eligible to enroll in a program
239	239	designed and established under this chapter if the person:
240	240	(1) is younger than 65;
241	241	(2) has a household income at or below 133 percent of
242	242	the federal poverty level; and
243	243	(3) is not otherwise eligible to receive benefits
244	244	under the state Medicaid program, including through a program
245	245	operated under Chapter 32, Human Resources Code, or under Chapter
246	246	532A through a block grant funding system or a waiver, other than a
247	247	waiver granted under this chapter, to the program.
248	248	(b) The executive commissioner may modify or further define
249	249	the eligibility requirements of this section if the commission
250	250	determines it necessary to reach an agreement under Subchapter B.
251	251	Sec. 545A.0102. MINIMUM PROGRAM REQUIREMENTS. A program
252	252	designed and established under this chapter must:
253	253	(1) if cost-effective for this state, provide premium
254	254	assistance to purchase health benefit plan coverage in the private
255	255	market, including health benefit plan coverage offered through a
256	256	managed care delivery model;
257	257	(2) provide enrollees with access to health benefits,
258	258	including benefits provided through a managed care delivery model,
259	259	that:
260	260	(A) are tailored to the enrollees;
261	261	(B) provide levels of coverage that are
262	262	customized to meet health care needs of individuals within defined
263	263	categories of the enrolled population; and
264	264	(C) emphasize personal responsibility and
265	265	accountability through flexible and meaningful cost-sharing
266	266	requirements and wellness initiatives, including through
267	267	incentives for compliance with health, wellness, and treatment
268	268	strategies and disincentives for noncompliance;
269	269	(3) include pay-for-performance initiatives for
270	270	private health benefit plan issuers that participate in the
271	271	program;
272	272	(4) use technology to maximize the efficiency with
273	273	which the commission and any health benefit plan issuer, health
274	274	care provider, or managed care organization participating in the
275	275	program manage enrollee participation;
276	276	(5) allow recipients under the state Medicaid program
277	277	to enroll in the program to receive premium assistance as an
278	278	alternative to the state Medicaid program;
279	279	(6) encourage eligible individuals to enroll in other
280	280	private or employer-sponsored health benefit plan coverage, if
281	281	available and appropriate;
282	282	(7) encourage the utilization of health care services
283	283	in the most appropriate low-cost settings; and
284	284	(8) establish health savings accounts for enrollees,
285	285	as appropriate.
286	286	SECTION 2.02. The Health and Human Services Commission in
287	287	consultation with the commissioner of insurance and the Medicaid
288	288	Reform Task Force established under Article 4 of this Act shall
289	289	actively develop a proposal for the authorization from the
290	290	appropriate federal entity as required by Subchapter B, Chapter
291	291	545A, Government Code, as added by this article. As soon as
292	292	possible after the effective date of this Act, the Health and Human
293	293	Services Commission shall request and actively pursue obtaining the
294	294	authorization from the appropriate federal entity.
295	295	ARTICLE 3. MEDICAID: INCREMENTAL REFORM
296	296	SECTION 3.01. Subchapter B, Chapter 546, Government Code,
297	297	as effective April 1, 2025, is amended by adding Section 546.0059 to
298	298	read as follows:
299	299	Sec. 546.0059. CUSTOMIZED BENEFITS PACKAGE. The commission
300	300	shall, for individuals receiving home and community-based services
301	301	and supports instead of institutional long-term services and
302	302	supports, develop and implement customized benefits packages that
303	303	are designed to prevent the overutilization of services.
304	304	Customized benefits packages under this section must be based on an
305	305	individualized needs assessment administered at a single point of
306	306	entry.
307	307	SECTION 3.02. Subchapter B, Chapter 32, Human Resources
308	308	Code, is amended by adding Sections 32.0501, 32.0642, and 32.078 to
309	309	read as follows:
310	310	Sec. 32.0501. DUAL ELIGIBLE INTEGRATED CARE DEMONSTRATION
311	311	PROJECT. (a) In this section:
312	312	(1) "ICF-IID" has the meaning assigned by Section
313	313	531.002, Health and Safety Code.
314	314	(2) "Nursing facility" has the meaning assigned by
315	315	Section 546.0351, Government Code.
316	316	(3) "State supported living center" has the meaning
317	317	assigned by Section 531.002, Health and Safety Code.
318	318	(b) Subject to Subsection (c), the commission shall
319	319	establish a dual eligible integrated care demonstration project
320	320	that would allow appropriate individuals described by Section
321	321	32.050(a), as determined by the commission, to receive long-term
322	322	services and supports under both the medical assistance program and
323	323	the Medicare program through a single managed care plan.
324	324	(c) An individual who is a resident of a nursing facility,
325	325	ICF-IID, or state supported living center is exempt from
326	326	participation in the demonstration project.
327	327	Sec. 32.0642. PARENTAL FEE PROGRAM. (a) To the extent
328	328	allowed by federal law, the commission shall establish a parental
329	329	fee program that requires the parent or legal guardian of a child
330	330	receiving institutional long-term services and supports or home and
331	331	community-based services and supports under the medical assistance
332	332	program established under this chapter to pay a fee that:
333	333	(1) correlates with the services and supports
334	334	provided; and
335	335	(2) takes into consideration the child's household
336	336	income.
337	337	(b) Failure to pay a fee under this section may not affect a
338	338	child's eligibility for benefits under the medical assistance
339	339	program.
340	340	(c) The executive commissioner shall adopt rules necessary
341	341	to implement this section.
342	342	Sec. 32.078. HOUSING BENEFITS FOR CERTAIN RECIPIENTS. To
343	343	the extent allowed by federal law, the commission shall provide
344	344	housing payment assistance for recipients receiving home and
345	345	community-based services and supports under the medical assistance
346	346	program established under this chapter.
347	347	SECTION 3.03. (a) The Health and Human Services Commission
348	348	shall conduct a study to examine the estate recovery program
349	349	implemented by this state under 42 U.S.C. Section 1396p(b)(1) and
350	350	determine options the state has to improve recovery under and
351	351	increase the efficacy of the program.
352	352	(b) Not later than December 1, 2026, the commission shall
353	353	submit a written report containing the findings of the study
354	354	conducted under this section together with the commission's
355	355	recommendations to the governor, the lieutenant governor, and the
356	356	standing committees of the senate and house of representatives
357	357	having primary jurisdiction over Medicaid.
358	358	SECTION 3.04. (a) The Health and Human Services Commission
359	359	shall conduct a study on imposing alternative income and asset
360	360	limits for purposes of determining eligibility for long-term
361	361	services and supports under the medical assistance program under
362	362	Chapter 32, Human Resources Code. The commission shall consider:
363	363	(1) imposing greater restrictions on exempt assets;
364	364	(2) limiting the amount of income that an individual
365	365	may transfer into a qualified trust under 42 U.S.C. Section
366	366	1396p(d)(4)(B) to an amount equal to the average cost of nursing
367	367	home care; and
368	368	(3) reducing the income eligibility limit to qualify
369	369	for Medicaid institutional long-term services and supports or home
370	370	and community-based waiver services under the medical assistance
371	371	program under Chapter 32, Human Resources Code.
372	372	(b) Not later than December 1, 2026, the commission shall
373	373	submit a written report containing the findings of the study
374	374	conducted under this section together with the commission's
375	375	recommendations to the governor, the lieutenant governor, and the
376	376	standing committees of the senate and house of representatives
377	377	having primary jurisdiction over Medicaid.
378	378	ARTICLE 4. MEDICAID REFORM TASK FORCE
379	379	SECTION 4.01. (a) In this section:
380	380	(1) "Commission" means the Health and Human Services
381	381	Commission.
382	382	(2) "Medicaid program" and "state Medicaid program"
383	383	have the meanings assigned by Section 532A.0001, Government Code,
384	384	as added by this Act.
385	385	(3) "Task force" means the Medicaid Reform Task Force
386	386	established under this section.
387	387	(b) The Medicaid Reform Task Force is established for
388	388	purposes of advising the commission in designing a state Medicaid
389	389	program and a program for ensuring health benefit plan coverage for
390	390	low-income individuals that are:
391	391	(1) consistent with Articles 2 and 3 of this Act; and
392	392	(2) if the federal government establishes a block
393	393	grant funding system in accordance with Section 532A.0002,
394	394	Government Code, as added by this Act, consistent with Article 1 of
395	395	this Act.
396	396	(c) The task force consists of 12 members appointed as
397	397	follows:
398	398	(1) one member appointed by the governor;
399	399	(2) two members of the senate appointed by the
400	400	lieutenant governor;
401	401	(3) two members of the house of representatives
402	402	appointed by the speaker of the house of representatives;
403	403	(4) one member of the Senate Committee on Finance,
404	404	appointed by the presiding officer;
405	405	(5) one member of the House Appropriations Committee,
406	406	appointed by the presiding officer;
407	407	(6) one member of the Senate Committee on Health and
408	408	Human Services, appointed by the presiding officer;
409	409	(7) one member of the House Public Health Committee,
410	410	appointed by the presiding officer;
411	411	(8) the executive commissioner of the commission or
412	412	the executive commissioner's designee;
413	413	(9) the commissioner of insurance or the
414	414	commissioner's designee to represent the Texas Department of
415	415	Insurance; and
416	416	(10) the director of the Legislative Budget Board or
417	417	the director's designee.
418	418	(d) The lieutenant governor and the speaker of the house of
419	419	representatives shall each appoint a member of the task force to act
420	420	as co-presiding officers.
421	421	(e) A member of the task force serves without compensation.
422	422	(f) Not later than January 1, 2026, the appropriate
423	423	appointing officers shall appoint the members of the task force.
424	424	(g) Not later than December 1, 2026, the task force shall
425	425	submit a report to the legislature regarding its activities under
426	426	this section.
427	427	(h) This section expires September 1, 2027.
428	428	ARTICLE 5. FEDERAL AUTHORIZATION AND EFFECTIVE DATE
429	429	SECTION 5.01. Subject to Section 2.02 of this Act, if before
430	430	implementing any provision of this Act a state agency determines
431	431	that a waiver or authorization from a federal agency is necessary
432	432	for implementation of that provision, the agency affected by the
433	433	provision shall request the waiver or authorization and may delay
434	434	implementing that provision until the waiver or authorization is
435	435	granted.
436	436	SECTION 5.02. This Act takes effect September 1, 2025.