By: Rodríguez S.B. No. 2223               A BILL TO BE ENTITLED   AN ACT   relating to Medicaid funding in this state, including the federal   government's participation in that funding.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 531.02113, Government Code, is amended   to read as follows:          Sec. 531.02113.  OPTIMIZATION OF MEDICAID FINANCING. The   commission shall ensure that the Medicaid finance system:                (1)  is optimized to:                      (A) [(1)]  maximize the state's receipt of   federal funds;                      (B) [(2)]  create incentives for providers to use   preventive care;                      (C) [(3)]  increase and retain providers in the   system to maintain an adequate provider network;                      (D) [(4)]  more accurately reflect the costs   borne by providers; and                      (E) [(5)]  encourage the improvement of the   quality of care; and                (2)  complies with the requirements of Chapter 540, if   applicable.          SECTION 2.  Subtitle I, Title 4, Government Code, is amended   by adding Chapter 540 to read as follows:   CHAPTER 540. MEDICAID FUNDING MODIFICATION          Sec. 540.0001.  APPLICABILITY. This chapter applies to a   waiver to the requirements of this state's Medicaid state plan or   other authorization under Medicaid:                (1)  for which the commission seeks approval from the   federal government; and                (2)  that, if approved, would change this state's   receipt of federal money for Medicaid from the funding system in   effect on January 1, 2017, to a block grant or other funding system.          Sec. 540.0002.  PRIMARY GOAL OF MEDICAID FUNDING   MODIFICATION. (a) The primary goal of a Medicaid funding   modification the commission seeks through a waiver or other   authorization to which this chapter applies must be to preserve the   best interests of the residents of this state.          (b)  The commission may not seek a waiver or other   authorization to which this chapter applies that is contrary to the   primary goal specified by Subsection (a) or that otherwise does not   meet the requirements of this chapter.          Sec. 540.0003.  ADEQUACY OF MEDICAID PROGRAM FUNDING. A   Medicaid funding modification the commission seeks through a waiver   or other authorization to which this chapter applies:                (1)  must account for and ensure adequate, continued   funding for:                      (A)  anticipated growth in the number of persons   in this state who will be eligible for and enroll in the Medicaid   program; and                      (B)  health care trends that may affect costs,   including:                            (i)  increases in utilization rates;                            (ii)  increases in the acuity of Medicaid   recipients;                            (iii)  advancements in medical technology;   and                            (iv)  advancements in specialized   prescription drugs; and                (2)  may not be designed in a manner that allows for   reductions in federal financial participation based on this state's   effective management of Medicaid cost growth.          Sec. 540.0004.  MAINTENANCE OF ELIGIBILITY REQUIREMENTS AND   COVERED SERVICES. A waiver or other authorization to which this   chapter applies must ensure that, at a minimum:                (1)  the eligibility criteria for full Medicaid   benefits in effect on January 1, 2017, are not made more restrictive   under the waiver or authorization, including the eligibility   criteria for low-income families, pregnant women, children,   persons who are 65 years of age or older, and persons with   disabilities;                (2)  the eligibility criteria for limited Medicaid   benefits in effect on January 1, 2017, are not made more restrictive   under the waiver or authorization; and                (3)  all acute care services and long-term services and   supports covered by Medicaid on January 1, 2017, continue to be   covered, regardless of whether those services are mandatory or   optional services under federal law.          Sec. 540.0005.  PROVIDER REIMBURSEMENTS AND OTHER PAYMENTS.   (a) A waiver or other authorization to which this chapter applies   must ensure that the Medicaid funding modification the commission   seeks through the waiver or authorization will:                (1)  support the provision of adequate reimbursements   to Medicaid providers, require reimbursement rates for those   providers for the provision of Medicaid services to be at least   equal to the rates in effect on January 1, 2017, and support   periodic reimbursement rate increases based on health care trends;                (2)  ensure continued provision of payments to   hospitals equal to supplemental payments by this state to hospitals   under supplemental payment programs in effect on January 1, 2017,   which may include continued provision through increases in rates   paid for direct hospital services to Medicaid enrollees; and                (3)  prioritize use of supplemental payments to   encourage continued development of comprehensive local and   regional health care systems that include preventive, primary,   specialty, outpatient, inpatient, mental health, and substance   abuse services for individuals without health insurance.          (b)  Reimbursement systems under a waiver or other   authorization to which this chapter applies must encourage   value-based payment arrangements for Medicaid providers and   support efforts to promote quality of care.          SECTION 3.  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.