UPDATED with Transcript: Video of Rep. Kolkhorst and Rep. Guerra in the House

On May 16th, SB 1803 (CSSB 1803) came before the Texas House of Representatives for third reading. Rep. Kolkhorst and Rep. Guerra added amendments and made comments about the necessity of putting in legislation due process rights for all Medicaid providers. The bill passed the House on May 17th, 119-20.

The quality of the video is poor as it is compiled from the streaming video archived by the legislature.

Transcript of Rep. Kolkhorst’s and Guerra’s comments and amendments

Kolkhorst: Thank you Mr. Speaker and Members. Senate Bill 1803 outlines the process that the Office of Inspector General and a provider must allow during the investigation of an allegation of fraud or overpayment. It codifies the time lines for when a provider is notified, and time frames for when a provider may attest or appeal charges. SB 1803 addresses details like interaction between the OIG and investigations from other law enforcement entities as the requirement that the process be clearly explained to the providers when they are notified of a payment hold, as well as posting this information online in the name of transparency and accountability.

Members, this is the effort to give doctors, dentists, providers, a due process if they are accused of or if there is a allegation of fraud or overpayment. This is something that has been worked on throughout this current session. I want to thank Bobby Guerra and Richard Raymond for their work, and of course Senator Huffman who put together a work group on this in March to address the concerns. We do have a couple of amendments and I want to explain those as they come forward.

Chair: The following amendments, incorporate the amendments.

Clerk: Amendment by Kolkhorst.

Chair: Chair recognizes Ms. Kolkhorst to explain the amendments.

Kolkhorst: Great. Thank you Madame Chair. I want to explain this amendment. When the bill came from the Senate, it put in many new due processes for the providers. And it allowed a track that the provider can have an informal settlement conference, it allowed it to then go to the SOAH hearings and then also go to a review by trial judge. It puts in many new steps.

When the bill was referred to Human Services, Chairman Raymond worked on a substitute that would give it two tracks — you go this way through SOAH, or you could go through the district court. We’ve had a lot of discussion today among Members, and what we’re going to do is, with this amendment, we’re going to take it back to how it came out of the Senate addressing some of the concerns of the Members that we’ve had and that’s why we’ve delayed the bill. And so it takes it back to the Senate and with one exception, that the commission shall at no expense to the provider who requested the meeting, provide for an informal resolution meeting held, give them a recording of that informal hearing so that there is some, you know, not the he said/she said, some recording of it.

And so this amendment puts it back to how it came back from the Senate, except for that one piece. And then Representative Guerra is going to have an amendment to – not to the amendment but another amendment on something that we’ve agreed to. So this amendment is acceptable to me.

Chair: Ms. Kolkhorst sends up an amendment, if acceptable to the author, is there any objections? Hearing none, the amendment is adopted.

Rep.: I’ve got a question. …Representative Kolkhorst, can you explicitly lay out the due process provisions that will remain for the medical providers, please.

Kolkhorst: Absolutely. So, in working with the providers and TMA, what came out of the Senate and what was looked at is, there are several new steps they took. Number one Representative, we put in time lines. And so one of the things that was a concern was when you had a CAF, a credible allegation of fraud, and there was a payment hold put on, it kind of spun out of control for some providers – don’t get me wrong, I don’t want to say that the State ever acted inappropriately – but there was a lot of mystery as to when the next step would happen so we put that in. And so we put in the steps that you start the new thing you take – there’s two tracks here, one is an overpayment and one of them is in the credible allegation of fraud, okay. So I could walk you through both of them but they’re very similar. So the medical director ensures a qualified expert reviewed any medical findings, that’s brand new okay. The provider receives notification of overpayment, so the first time ever we’re going to have, make sure that we have a qualified expert reviewing the medical findings. The provider receives notification of overpayment, notice of extrapolation methodology, calculation of overpayment. That’s new. So

Raymond: Representative Kolkhorst can I interrupt you there.

Kolkhorst: Sure.

Rep: These, your amendment, you’ve been talking with the stake holders and working with Representative Guerra so that not all the due process rights that the medical providers would have enjoyed, have been stripped out, is that correct?

Kolkhorst: Oh no. No sir, no sir. In fact, in dealing with the folks from your area, and I know that JM came over to me when I delayed it and he was very nervous, that’s part of why … okay Chairman Raymond kind of put in two tracks and I’ll cut to the chase here. There’s the track that came out, for the first time ever, we will have time lines, we will have notifications, a doctor will know exactly, or dentist, what’s going on, okay. That all remains – due process, going through SOAH – and when you don’t like your finding at SOAH, right now you have to appeal it back to the agency.

Rep.: Right.

Kolkhorst: How’s that going to go? Not very well probably. And so now we put this in process where you have an appeal process by someone that is not the agency. And so, let me tell you what Chairman Raymond was worried about was, well you know, he at first started with the trail du novo, and then he said well, we’ll go on two tracks, okay. You can either go the SOAH route or you can go district trial route, okay. And he did put that in the substitute and that’s what was voted out of the committee.

And you know, be respectful to the process, you know, I was going to come to the floor today and do that. We had alot of concern, alot of groups against this new process. And I will say that you can’t throw the baby out with the bath water okay, in that we want to make sure for the first time ever, and I would say that some of the medical associations have been working on this for years to get some kind of due process. So we are definitely moving the ball forward way beyond where we are today. This is how it came out of the Senate, and I’m pleased with it, and I would rather this bill not go down. And so working with the members

Rep.: And you’re satisfied, or your amendment now satisfies the stake holders and in particular – I’m not talking about groups that are not part of the process like TMA and other groups – but specifically with Texas Medical Association, are they brought into your amendments?

Kolkhorst: Absolutely. And I met with even a provider from your area I believe.

Rep: Yes mam.

Kolkhorst: And he said yes, we will take 1803 as it came out of the Senate. So I want to ensure the body, I’ve had a number of members come to me and say I don’t even think we need this bill in general. And I’m going to tell you that for our providers, for our doctors, for our dentists, we need this bill so that they have certainty if they have a credible allegation of fraud, if they are, you know, or if the OIG comes back with an overpayment potential, that there are steps and it’s going to be posted online, there is no more guessing. There’s a due process. You are not guilty before proven innocent, you are innocent before proven guilty. And that is why I stand before you today with confidence that we are moving the ball in the right direction.

Rep.: Thank you Representative Kolkhorst, thank you.

Kolkhorst: Yes Sir.

Chair: (inaudible) the amendment, the Clerk will read the amendment.

Clerk: Amendment by Guerra.

Chair: Chair recognizes Mr. Guerra to explain the amendment.

Guerra: Thank you members. As Chair Kolkhorst explained, this has been a long process. In fact, the very first hearing I had on the due process issue in Chairman Raymond’s committee, was about 6 hours long. We heard a lot of testimony from a lot of physicians, mainly orthodontists and dentists, who had been targeted by the OIG, in what was felt like a very unfair manner. Yes indeed we want to stop fraud, that’s a very very important part of what our responsibility is, but at the same time it’s very very important that we bring, that we go about it in the right way and not single healthcare providers out unfairly. And so what we’ve done is, I had originally filed a bill for due process, which is a trial du novo for the lawyers. You know what a trail du novo is. That was going to be if you didn’t like the ultimate decision, you could take it before a district court in Travis County.

But as Chair Kolkhorst explained, this has been a moving process and the bill overall is much better now than what it was. And so my amendment basically provides that the Health Public Health Committee and the Health Human Services Committee and the Senate Health and Human Service Committee shall periodically request and review information from the Health and Human Services Commission. In other words, an oversight. But mainly of the activities of the Inspector General, the OIG. The Health Public Health Committee and the Health and Human Services Committee would perform these duties jointly. It’s not exactly what we wanted, in fact it’s a far cry from it. But there are so many other parts to this bill that will benefit our health care providers to make sure that everything is, that when an investigation is launched, it is done with some due process and so the author of the bill approves this amendment.

Chair: Mr. Guerra sends up an amendment, if acceptable to the author, is there any objection? Hearing none the amendment is adopted. Chair recognizes Ms. Kolkhorst on the bill.

Kolkhorst: I want to thank everyone who has worked on this. I’ve had some questions about due process and yes, there is an appeal beyond SOAH. I think it gives the protections needed but it does not have trial du novo in it which was some of the concerns that we heard and I move passage. Thank you members.

Chair: The question occurs on passage to engrossment of Senate bill 1803. All those in favor say aye, opposed nay. The I’s have it and Senate bill 1803 is passed to engrossment.

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