2023 Texas Statutes › Health and Safety Code › Title 4 - Health Facilities › Subtitle F - Powers and Duties of Hospitals › Chapter 314A - Merger Agreements Among Certain Hospitals › Subchapter C. Supervision of Merged Hospitals Under Approved Merger Agreement › Section 314A.102. Rate Review

Sec. 314A.102.  RATE REVIEW.  (a)  A change in rates for hospital services by a hospital operating under a certificate of public advantage issued under this chapter may not take effect without prior approval of the designated agency as provided by this section.
(b)  At least 90 days before the implementation of any proposed change in rates for inpatient or outpatient hospital services and, if applicable, at least 60 days before the execution of a reimbursement agreement with a third party payor, a hospital operating under a certificate of public advantage shall submit to the designated agency:
(1)  any proposed change in rates for inpatient and outpatient hospital services;
(2)  if applicable, any change in reimbursement rates under a reimbursement agreement with a third party payor;
(3)  for an agreement with a third party payor, other than an agreement described by Subdivision (4) or in which rates are set under the Medicare or Medicaid program, information showing:
(A)  that the hospital and the third party payor have agreed to the proposed rates;
(B)  whether the proposed rates are less than the corresponding amounts in the producer price index published by the Bureau of Labor Statistics of the United States Department of Labor relating to the hospital services for which the rates are proposed or a comparable price index chosen by the designated agency if the producer price index described by this paragraph is abolished; and
(C)  if the proposed rates are above the corresponding amounts in the producer price index as described by Paragraph (B), a justification for proposing rates above the corresponding amounts in the producer price index;
(4)  to the extent allowed by federal law, for an agreement with a managed care organization that provides or arranges for the provision of health care services under the Medicare or Medicaid program, information showing:
(A)  whether the proposed rates are different from rates under an agreement that was in effect before the date the applicable merger agreement took effect;
(B)  whether the proposed rates are different from the rates most recently approved by the designated agency for the applicable hospital, if the designated agency has previously approved rates for the applicable hospital following the issuance of the certificate of public advantage under this chapter that governs the hospital; and
(C)  if the proposed rates exceed rates described by Paragraph (A) or (B), a justification for proposing rates in excess of those rates; and
(5)  any information concerning costs, patient volume, acuity, payor mix, and other information requested by the designated agency.
(c)  After reviewing the proposed change in rates submitted under Subsection (b), the designated agency shall approve or deny the proposed rate change.  The designated agency shall approve the proposed rate change if the designated agency determines that:
(1)  the proposed rate change likely benefits the public by maintaining or improving the quality, efficiency, and accessibility of health care services offered to the public; and
(2)  the proposed rate does not inappropriately exceed competitive rates for comparable services in the hospital's market area.
(d)  If the designated agency determines that the proposed rate change does not satisfy Subsection (c)(1) or (2), the designated agency shall deny or modify the proposed rate change.
(e)  The designated agency shall notify the hospital in writing of the agency's decision to approve, deny, or modify the proposed rate change not later than the 30th day before the implementation date of the proposed change.
Added by Acts 2019, 86th Leg., R.S., Ch. 1168 (H.B. 3301), Sec. 1, eff. September 1, 2019.