89R4055 SCF-D
	By: Hinojosa of Hidalgo	S.B. No. 2548

	A BILL TO BE ENTITLED
	AN ACT
	relating to awarding contracts to managed care organizations under
	Medicaid and the child health plan program.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 540.0204, Government Code, as effective
	April 1, 2025, is amended to read as follows:
	Sec. 540.0204.  CONTRACT CONSIDERATIONS RELATING TO MANAGED
	CARE ORGANIZATIONS.  (a)  In awarding contracts to managed care
	organizations, the commission shall:
	(1)  subject to Subsection (b), give preference to an
	organization that has significant participation in the
	organization's provider network from each health care provider in
	the region who has traditionally provided care to Medicaid and
	charity care patients;
	(2)  give extra consideration to an organization that
	agrees to assure continuity of care for at least three months beyond
	a recipient's Medicaid eligibility period;
	(3)  consider the need to use different managed care
	plans to meet the needs of different populations, including a plan
	with a children's hospital that serves a special patient population
	in the plan's provider network; [and]
	(4)  consider the ability of an organization to process
	Medicaid claims electronically;
	(5)  in accordance with Section 540.0051(2), consider
	the impact not renewing an organization's contract may have on
	access to care and the quality of care that is available in
	recipients' local communities; and
	(6)  in the South Texas service region, give extra
	consideration to an organization that is either:
	(A)  locally owned, managed, and operated, if one
	exists; or
	(B)  in compliance with the requirements of
	Section 540.0206.
	(b)  In determining whether a managed care organization must
	be given preference under Subsection (a)(1), the commission shall:
	(1)  inquire about and evaluate the organization's
	current provider network in the region where the organization seeks
	to operate; and
	(2)  review and consider publicly available
	information about the organization.
	(c)  The commission shall ensure bid evaluators are aware of
	the requirements of this section, including the commission's duty
	under Subsection (a)(1) to give preference to a managed care
	organization that has significant participation in the
	organization's provider network from health care providers who
	traditionally provide care to Medicaid and charity care patients.
	SECTION 2.  Section 543A.0052(d), Government Code, as
	effective April 1, 2025, is amended to read as follows:
	(d)  In awarding contracts to managed care organizations
	under the child health plan program and Medicaid, the commission
	shall, in addition to considerations under Section 540.0204 of this
	code and Section 62.155, Health and Safety Code, give preference to
	an organization that offers a managed care plan that:
	(1)  successfully implements quality initiatives under
	Subsection (a) as the commission determines based on data or other
	evidence the organization provides; and [or]
	(2)  meets quality-of-care and cost-efficiency
	benchmarks under Subsection (b).
	SECTION 3.  Section 2155.144, Government Code, as effective
	April 1, 2025, is amended by adding Subsection (e) to read as
	follows:
	(e)  In addition to all relevant factors under Subsection
	(d), when determining best value in awarding a contract to a managed
	care organization to provide health care services to enrollees or
	recipients under the child health plan program or Medicaid, the
	Health and Human Services Commission shall consider the
	organization's past performance under similar contracts and, if
	applicable, review and score the organization's past performance
	under any contract entered into with the commission.
	SECTION 4.  (a)  Subject to Subsection (b) of this section,
	the changes in law made by this Act apply only to a contract awarded
	on or after the effective date of this Act. A contract awarded
	before the effective date of this Act is governed by the law as it
	existed immediately before the effective date of this Act, and that
	law is continued in effect for that purpose.
	(b)  For purposes of Subsection (a) of this section, a
	contract is not considered awarded if on the effective date of this
	Act:
	(1)  the Health and Human Services Commission has not
	progressed beyond issuing an intent to award a contract under the
	procurement process; or
	(2)  the award is subject to pending litigation.
	(c)  In awarding a contract to a managed care organization
	under a procurement described by Subsection (b)(1) or (2) of this
	section, the Health and Human Services Commission shall conduct a
	reevaluation of bids for each service delivery area in accordance
	with the changes in law made by this Act, and if, based on the
	reevaluation, the commission determines that an organization
	submitted a higher scoring bid for the area than the bid submitted
	by the organization the commission intended to award, or awarded, a
	contract to under the law as it existed immediately before the
	effective date of this Act, the commission shall instead award the
	contract to the organization that submitted the highest scoring
	bid.
	SECTION 5.  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 6.  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, 2025.