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  H.B. No. 2439
 
 
 
 
AN ACT
  relating to the functions of local mental health and mental
  retardation authorities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 533.031, Health and Safety Code, is
  amended by adding Subdivisions (4), (5), (6), (7), and (8) to read
  as follows:
               (4)  "Commission" means the Health and Human Services
  Commission.
               (5)  "Executive commissioner" means the executive
  commissioner of the Health and Human Services Commission.
               (6)  "ICF-MR and related waiver programs" includes
  ICF-MR Section 1915(c) waiver programs, home and community-based
  services, Texas home living waiver services, or another Medicaid
  program serving persons with mental retardation.
               (7)  "Section 1915(c) waiver program" means a federally
  funded Medicaid program of the state that is authorized under
  Section 1915(c) of the federal Social Security Act (42 U.S.C.
  Section 1396n(c)).
               (8)  "Qualified service provider" means an entity that
  meets requirements for service providers established by the
  executive commissioner.
         SECTION 2.  Section 533.035, Health and Safety Code, is
  amended by amending Subsections (a), (c), and (e) and adding
  Subsections (b-1) and (e-1) to read as follows:
         (a)  The executive commissioner shall designate a local
  mental health authority and a local mental retardation authority in
  one or more local service areas. The executive commissioner
  [board] may delegate to the local authorities the [board's]
  authority and responsibility of the executive commissioner, the
  commission, or a department of the commission related to [for the]
  planning, policy development, coordination, including coordination
  with criminal justice entities, resource allocation, and resource
  development for and oversight of mental health and mental
  retardation services in the most appropriate and available setting
  to meet individual needs in that service area. The executive
  commissioner may designate a single entity as the local mental
  health authority and the local mental retardation authority for a
  service area.
         (b-1)  This subsection expires September 1, 2009, and
  applies only to the determination of payment methodologies for
  mental health services and not to rate setting or the payment rates
  for intermediate care facilities for the mentally retarded, Section
  1915(c) waiver programs, mental retardation service coordination,
  and other Medicaid services.  Before the Department of State Health
  Services institutes a change in payment methodology for mental
  health services, the department shall:
               (1)  evaluate various forms of payment for services,
  including fee-for-service, case rate, capitation, and other
  appropriate payment methods to determine the most cost-effective
  and efficient form of payment for services;
               (2)  evaluate the effect of each proposed payment
  methodology on:
                     (A)  the availability of services in urban and
  rural service areas;
                     (B)  the availability of services for persons who
  are indigent;
                     (C)  the cost certainty of the delivery of
  Medicaid rehabilitation mental health services; and
                     (D)  the ability of the local mental health
  authority to meet unique local needs and develop and manage a
  network of providers;
               (3)  determine the implementation and ongoing
  operational costs for the state and local mental health authorities
  associated with each proposed payment methodology;
               (4)  develop an implementation plan, with the advice
  and assistance of the local authority network advisory committee,
  for any new payment methodology for mental health services that
  integrates the department's findings under Subdivisions (1), (2),
  and (3); and
               (5)  report the department's findings and the
  implementation plan for any new payment methodology for mental
  health services to the executive commissioner and the legislature
  not later than January 1, 2009.
         (c)  A local mental health and mental retardation authority,
  with the [department's] approval of the Department of State Health
  Services or the Department of Aging and Disability Services, or
  both, as applicable, shall use the funds received under Subsection
  (b) to ensure mental health, mental retardation, and chemical
  dependency services are provided in the local service area. The
  local authority shall consider public input, ultimate
  cost-benefit, and client care issues to ensure consumer choice and
  the best use of public money in:
               (1)  assembling a network of service providers; [and]
               (2)  making recommendations relating to the most
  appropriate and available treatment alternatives for individuals
  in need of mental health or mental retardation services; and
               (3)  procuring services for a local service area,
  including a request for proposal or open-enrollment procurement
  method.
         (e)  Subject to Section 533.0358, in [In] assembling a
  network of service providers, a local mental health [and mental
  retardation] authority may serve as a provider of services only as a
  provider of last resort and only if the local authority
  demonstrates to the department in the local authority's local
  network development plan that:
               (1)  the local authority has made every reasonable
  attempt to solicit the development of an available and appropriate
  provider base that is sufficient to meet the needs of consumers in
  its service area; and
               (2)  there is not a willing provider of the relevant
  services in the local authority's service area or in the county
  where the provision of the services is needed.
         (e-1)  A local mental retardation authority may serve as a
  provider of ICF-MR and related waiver programs only if:
               (1)  the local authority complies with the limitations
  prescribed by Section 533.0355(d); or
               (2)  the ICF-MR and related waiver programs are
  necessary to ensure the availability of services and the local
  authority demonstrates to the commission that there is not a
  willing ICF-MR and related waiver program qualified service
  provider in the local authority's service area where the service is
  needed.
         SECTION 3.  Section 533.0351, Health and Safety Code, is
  amended to read as follows:
         Sec. 533.0351.  LOCAL AUTHORITY NETWORK [TECHNICAL]
  ADVISORY COMMITTEE.  (a) [In this section, "local authority" means
  a local mental health or mental retardation authority.
         [(b)] The executive commissioner shall establish a
  [nine-member] local authority network advisory committee to advise
  the executive commissioner and the Department of State Health
  Services on technical and administrative issues that directly
  affect local mental health authority responsibilities.
         (b) [(c)]  The committee is composed of equal numbers of 
  representatives of local mental health authorities, community
  mental health service providers, private mental health service
  providers, local government officials, advocates for individuals
  with mental health needs, consumers of mental health services,
  family members of individuals with mental health needs, and other
  individuals with expertise in the field of mental health [and one
  member representing the public] appointed by the executive
  commissioner. In addition, the executive commissioner may appoint
  facilitators to the committee as necessary.  In appointing the
  members, the executive commissioner shall also ensure a balanced
  representation of:
               (1)  different regions of this state;
               (2)  rural and urban counties; and
               (3)  single-county and multicounty local mental health
  authorities.
         (c)  Members [(d)   Except for the member representing the
  public, members] appointed to the advisory committee must have some
  knowledge of, familiarity with, or understanding of [expertise in]
  the day-to-day operations of a local mental health authority.
         (d) [(e)]  The advisory committee shall:
               (1)  review rules and proposed rules and participate in
  any negotiated rulemaking process related to local mental health
  authority operations;
               (2)  advise the executive commissioner and the
  Department of State Health Services regarding evaluation and
  coordination of initiatives related to local mental health
  authority operations;
               (3)  advise the executive commissioner and the
  Department of State Health Services [and assist the department] in
  developing a method of contracting with local mental health
  authorities that will result in contracts that are flexible and
  responsive to:
                     (A)  the needs and services of local communities;
  and
                     (B)  the department's performance expectations;
               (4)  coordinate with [and monitor the activities of]
  work groups whose actions may affect local mental health authority
  operations;
               (5)  report to the executive commissioner and the
  Department of State Health Services [board] on the committee's
  activities and recommendations at least once each fiscal quarter;
  and
               (6)  work with the executive commissioner or the
  Department of State Health Services as the executive commissioner
  directs.
         (e) [(f)]  For any written recommendation the committee
  makes to the Department of State Health Services [department], the
  department shall provide to the committee a written response
  regarding any action taken on the recommendation or the reasons for
  the department's inaction on the subject of the recommendation.
         (f)  The [(g)  Except as provided by this subsection, the]
  committee is subject to Chapter 2110, Government Code, except that
  the committee is not subject to Section 2110.004 or 2110.008,
  Government Code. The committee is abolished [automatically] on
  September 1, 2017 [2007], unless the executive commissioner [board]
  adopts a rule continuing the committee in existence beyond that
  date.
         (g)  The Department of State Health Services may reimburse
  consumers of mental health services and family members of
  individuals with mental health needs appointed to the committee for
  travel costs incurred in performing their duties as provided in the
  General Appropriations Act.
         SECTION 4.  Subchapter B, Chapter 533, Health and Safety
  Code, is amended by adding Section 533.03521 to read as follows:
         Sec. 533.03521.  LOCAL NETWORK DEVELOPMENT PLAN CREATION AND
  APPROVAL.  (a)  A local mental health authority shall develop a
  local network development plan regarding the configuration and
  development of the local mental health authority's provider
  network. The plan must reflect local needs and priorities and
  maximize consumer choice and access to qualified service providers.
         (b)  The local mental health authority shall submit the local
  network development plan to the Department of State Health Services
  for approval.
         (c)  On receipt of a local network development plan under
  this section, the department shall review the plan to ensure that
  the plan:
               (1)  complies with the criteria established by Section
  533.0358 if the local mental health authority is providing services
  under that section; and
               (2)  indicates that the local mental health authority
  is reasonably attempting to solicit the development of a provider
  base that is:
                     (A)  available and appropriate; and
                     (B)  sufficient to meet the needs of consumers in
  the local authority's local service area.
         (d)  If the department determines that the local network
  development plan complies with Subsection (c), the department shall
  approve the plan.
         (e)  At least biennially, the department shall review a local
  mental health authority's local network development plan and
  determine whether the plan complies with Subsection (c).
         (f)  As part of a local network development plan, a local
  mental health authority annually shall post on the local
  authority's website a list of persons with whom the local authority
  had a contract or agreement in effect during all or part of the
  previous year, or on the date the list is posted, related to the
  provision of mental health services.
         SECTION 5.  Section 533.0355, Health and Safety Code, is
  amended to read as follows:
         Sec. 533.0355.  LOCAL MENTAL RETARDATION AUTHORITY
  RESPONSIBILITIES [ALLOCATION OF DUTIES UNDER CERTAIN MEDICAID
  WAIVER PROGRAMS].  (a)  The executive commissioner shall adopt
  rules establishing the roles and responsibilities of local mental
  retardation authorities [In this section, "waiver program" means
  the local mental retardation authority waiver program established
  under the state Medicaid program].
         (b)  In adopting rules under this section, the executive
  commissioner must include rules regarding the following local
  mental retardation authority responsibilities:
               (1)  access;
               (2)  intake;
               (3)  eligibility functions;
               (4)  enrollment, initial person-centered assessment,
  and service authorization;
               (5)  utilization management;
               (6)  safety net functions, including crisis management
  services and assistance in accessing facility-based care;
               (7)  service coordination functions;
               (8)  provision and oversight of state general revenue
  services;
               (9)  local planning functions, including stakeholder
  involvement, technical assistance and training, and provider
  complaint and resolution processes; and
               (10)  processes to assure accountability in
  performance, compliance, and monitoring. [A provider of services
  under the waiver program shall:
               [(1)     develop a person-directed plan and an individual
  program plan for each person who receives services from the
  provider under the waiver program;
               [(2)     perform justification and implementation
  functions for the plans described by Subdivision (1);
               [(3)     conduct case management under the waiver program,
  other than case management under Subsection (c)(3), in accordance
  with applicable state and federal laws; and
               [(4)     plan, coordinate, and review the provision of
  services to all persons who receive services from the service
  provider under the waiver program.]
         (c)  In determining eligibility under Subsection (b)(3), a
  local mental retardation authority must offer a state school as an
  option among the residential services and other community living
  options available to an individual who is eligible for those
  services and who meets the department's criteria for state school
  admission, regardless of whether other residential services are
  available to the individual.
         (d)  In establishing a local mental retardation authority's
  role as a qualified service provider of ICF-MR and related waiver
  programs under Section 533.035(e-1), the executive commissioner
  shall require the local mental retardation authority to:
               (1)  base the local authority's provider capacity on
  the local authority's August 2004 enrollment levels for the waiver
  programs the local authority operates and, if the local authority's
  enrollment levels exceed those levels, to reduce the levels by
  attrition; and
               (2)  base any increase in the local authority's
  provider capacity on:
                     (A)  the local authority's state-mandated
  conversion from an ICF-MR program to a Section 1915(c) waiver
  program allowing for a permanent increase in the local authority's
  provider capacity in accordance with the number of persons who
  choose the local authority as their provider;
                     (B)  the local authority's voluntary conversion
  from an ICF-MR program to a Section 1915(c) waiver program allowing
  for a temporary increase in the local authority's provider
  capacity, to be reduced by attrition, in accordance with the number
  of persons who choose the local authority as their provider;
                     (C)  the local authority's refinancing from
  services funded solely by state general revenue to a Medicaid
  program allowing for a temporary increase in the local authority's
  provider capacity, to be reduced by attrition, in accordance with
  the number of persons who choose the local authority as their
  provider; or
                     (D)  other extenuating circumstances that:
                           (i)  are monitored and approved by the
  Department of Aging and Disability Services;
                           (ii)  do not include increases that
  unnecessarily promote the local authority's provider role over its
  role as a local mental retardation authority; and
                           (iii)  may include increases necessary to
  accommodate a family-specific or consumer-specific circumstance
  and choice [A local mental retardation authority shall:
               [(1)     manage any waiting lists for services under the
  waiver program;
               [(2)     perform functions relating to consumer choice and
  enrollment for persons who receive services under the waiver
  program; and
               [(3)     conduct case management under the waiver program
  relating to funding disputes between a service provider and the
  local mental retardation authority.
         [(d)     The department shall perform all administrative
  functions under the waiver program that are not assigned to a
  service provider under Subsection (b) or to a local mental
  retardation authority under Subsection (c). Administrative
  functions performed by the department include:
               [(1)     any surveying, certification, and utilization
  review functions required under the waiver program; and
               [(2)     managing an appeals process relating to decisions
  that affect a person receiving services under the waiver program].
         (e)  Any increase based on extenuating circumstances under
  Subsection (d)(2)(D) is considered a temporary increase in the
  local mental retardation authority's provider capacity, to be
  reduced by attrition [The department shall review:
               [(1)  screening and assessment of levels of care;
               [(2)     case management fees paid under the waiver
  program to a community center; and
               [(3)     administrative fees paid under the waiver program
  to a service provider].
         (f)  At least biennially, the Department of Aging and
  Disability Services shall review and determine the local mental
  retardation authority's status as a qualified service provider in
  accordance with criteria that includes the consideration of the
  local authority's ability to assure the availability of services in
  its area, including:
               (1)  program stability and viability;
               (2)  the number of other qualified service providers in
  the area; and
               (3)  the geographical area in which the local authority
  is located [The department shall perform any function relating to
  inventory for persons who receive services under the waiver program
  and agency planning assessments].
         (g)  The Department of Aging and Disability Services shall
  ensure that local services delivered further the following goals:
               (1)  to provide individuals with the information,
  opportunities, and support to make informed decisions regarding the
  services for which the individual is eligible;
               (2)  to respect the rights, needs, and preferences of
  an individual receiving services; and
               (3)  to integrate individuals with mental retardation
  and developmental disabilities into the community in accordance
  with relevant independence initiatives and permanency planning
  laws. [The review required under Subsection (e) must include a
  comparison of fees paid before the implementation of this section
  with fees paid after the implementation of this section. The
  department may adjust fees paid based on that review.
         [(h)     The department shall allocate the portion of the gross
  reimbursement funds paid to a local authority and a service
  provider for client services for the case management function in
  accordance with this section and to the extent allowed by law.
         [(i)     The department may adopt rules governing the functions
  of a local mental retardation authority or service provider under
  this section.]
         SECTION 6.  Subchapter B, Chapter 533, Health and Safety
  Code, is amended by adding Sections 533.0357, 533.0358, and
  533.0359 to read as follows:
         Sec. 533.0357.  BEST PRACTICES CLEARINGHOUSE FOR LOCAL
  MENTAL HEALTH AUTHORITIES. (a) In coordination with local mental
  health authorities, the department shall establish an online
  clearinghouse of information relating to best practices of local
  mental health authorities regarding the provision of mental health
  services, development of a local provider network, and achievement
  of the best return on public investment in mental health services.
         (b)  The department shall solicit and collect from local
  mental health authorities that meet established outcome and
  performance measures, community centers, consumers and advocates
  with expertise in mental health or in the provision of mental health
  services, and other local entities concerned with mental health
  issues examples of best practices related to:
               (1)  developing and implementing a local network
  development plan;
               (2)  assembling and expanding a local provider network
  to increase consumer choice;
               (3)  creating and enforcing performance standards for
  providers;
               (4)  managing limited resources;
               (5)  maximizing available funding;
               (6)  producing the best client outcomes;
               (7)  ensuring consumers of mental health services have
  control over decisions regarding their health;
               (8)  developing procurement processes to protect
  public funds;
               (9)  achieving the best mental health consumer outcomes
  possible; and
               (10)  implementing strategies that effectively
  incorporate consumer and family involvement to develop and evaluate
  the provider network.
         (c)  The department may contract for the services of one or
  more contractors to develop, implement, and maintain a system of
  collecting and evaluating the best practices of local mental health
  authorities as provided by this section.
         (d)  The department shall encourage local mental health
  authorities that successfully implement best practices in
  accordance with this section to mentor local mental health
  authorities that have service deficiencies.
         (e)  Before the executive commissioner may remove a local
  mental health authority's designation under Section 533.035(a) as a
  local mental health authority, the executive commissioner shall:
               (1)  assist the local mental health authority in
  attaining training and mentorship in using the best practices
  established in accordance with this section; and
               (2)  track and document the local mental health
  authority's improvements in the provision of service or continued
  service deficiencies.
         (f)  Subsection (e) does not apply to the removal of a local
  mental health authority's designation initiated at the request of a
  local government official who has responsibility for the provision
  of mental health services.
         (g)  The department shall implement this section using only
  existing resources.
         (h)  The Department of State Health Services shall ensure
  that a local mental health authority providing best practices
  information to the department or mentoring another local mental
  health authority complies with Section 533.03521(f).
         Sec. 533.0358.  LOCAL MENTAL HEALTH AUTHORITY'S PROVISION OF
  SERVICES AS PROVIDER OF LAST RESORT.  (a) A local mental health
  authority may serve as a provider of services under Section
  533.035(e) only if, through the local network development plan
  process, the local authority determines that at least one of the
  following applies:
               (1)  interested qualified service providers are not
  available to provide services or no service provider meets the
  local authority's procurement requirements;
               (2)  the local authority's network of providers does
  not provide a minimum level of consumer choice by:
                     (A)  presenting consumers with two or more
  qualified service providers in the local authority's network for
  service packages; and
                     (B)  presenting consumers with two or more
  qualified service providers in the local authority's network for
  specific services within a service package;
               (3)  the local authority's provider network does not
  provide consumers in the local service area with access to services
  at least equal to the level of access provided as of a date the
  executive commissioner specifies;
               (4)  the combined volume of services delivered by
  qualified service providers in the local network does not meet all
  of the local authority's service capacity for each service package
  identified in the local network development plan;
               (5)  the performance of the services by the local
  authority is necessary to preserve critical infrastructure and
  ensure continuous provision of services; or
               (6)  existing contracts or other agreements restrict
  the local authority from contracting with qualified service
  providers for services in the local network development plan.
         (b)  If a local mental health authority continues to provide
  services in accordance with this section, the local authority shall
  identify in the local authority's local network development plan:
               (1)  the proportion of its local network services that
  the local authority will provide; and
               (2)  the local authority's basis for its determination
  that the local authority must continue to provide services.
         Sec. 533.0359.  RULEMAKING FOR LOCAL MENTAL HEALTH
  AUTHORITIES.  (a)  In developing rules governing local mental
  health authorities under Sections 533.035, 533.0351, 533.03521,
  533.0357, and 533.0358, the executive commissioner shall use
  rulemaking procedures under Subchapter B, Chapter 2001, Government
  Code.
         (b)  The executive commissioner by rule shall prohibit a
  trustee or employee of a local mental health authority from
  soliciting or accepting from another person a benefit, including a
  security or stock, a gift, or another item of value, that is
  intended to influence the person's conduct of authority business.
         SECTION 7.  Sections 533.035(f) and (g), Health and Safety
  Code, are repealed.
         SECTION 8.  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 9.  Not later than January 1, 2008, the Health and
  Human Services Commission shall submit a report to the governor,
  the lieutenant governor, and the speaker of the house of
  representatives that includes:
               (1)  whether a waiver from a federal agency is
  necessary for implementation of any provision of this Act and, if a
  waiver is necessary, the date the commission applied for that
  waiver or will apply for the waiver; and
               (2)  any other information the commission finds
  relevant regarding the implementation of Sections 533.035,
  533.0351, 533.03521, 533.0355, 533.0357, and 533.0358, Health and
  Safety Code, as amended or added by this Act, by local mental health
  and mental retardation authorities.
         SECTION 10.  Not later than November 1, 2007, the executive
  commissioner of the Health and Human Services Commission shall
  re-create and appoint the members of the local authority network
  advisory committee under Section 533.0351, Health and Safety Code,
  as amended by this Act.
         SECTION 11.  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, 2007.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 2439 was passed by the House on April
  26, 2007, by the following vote:  Yeas 142, Nays 0, 2 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 2439 on May 17, 2007, by the following vote:  Yeas 133, Nays 1,
  1 present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 2439 was passed by the Senate, with
  amendments, on May 15, 2007, by the following vote:  Yeas 30, Nays
  0.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor