THA Leadership Fellows Program Module III Sept. 7, 2016 Jennifer Banda, J.D. Vice President – Advocacy and Public Policy Texas Hospital Association Overview of the Regulatory Process: How it Pertains to Hospitals

Overview of the Regulatory Process 2

First This. 3

Then This. 4

Now, This! 5

Overview of Regulatory Process  The Texas Legislature and the United States Congress have authority to enact new laws or changes in existing laws, and state and federal regulatory agencies are responsible for implementation and enforcement of the laws  Regulatory process involves: –Development of rules based on laws enacted by Legislature or Congress –Communication of rule changes (or proposed changes) to regulated individuals or organizations –Data and information collection, leading to public reporting  Annual Survey, Charity Care & Community Benefits, Discharge Data (inpatient and outpatient claims), Birth Certificates, HAI –Monitor compliance with rules by regulated individuals or organizations –Investigation of potential violations of rules –Enforcement action and imposition of penalties

Who Are The Players? Agency Staff – From EC to Program Staff Agency Process Participants (board, councils, etc.) Stakeholders Public Media? 7

Key State Regulatory Agencies Texas Health and Human Services Commission HHSC oversees the operations of the health and human services system, provides administrative oversight of Texas health and human services programs, and provides direct administration of some programs. >12,000 employees and $24B/year budget HHSC oversees the Texas health and human services system, which is composed of five agencies*: Health and Human Services Commission (HHSC) Department of Aging and Disability Services (DADS) Department of State Health Services (DSHS) Department of Assistive and Rehabilitative Services (DARS) Department of Family and Protective Services (DFPS) -

*HHSC Transformation Phase 1: On 9/1, ~4,000 employees and more than 120 programs and functions will officially “move” to HHSC from four other health and human state agencies. Consolidates client services into a single division at HHSC, rather than have them exist at several agencies. This Medical and Social Services Division will create a central structure, connecting behavioral, medical, preventive care, disability, developmental and other services into one area to better meet the needs of the whole person. Phase 2: On 9/1/17, moves certain regulatory programs, state hospitals and state supported living centers to HHSC from other agencies. The changes are part of the system’s consolidation from five agencies to three. The transformation will eliminate the need for the Department of Assistive and Rehabilitative Services and the Department of Aging and Disability Services to operate as separate agencies by The transformation also includes moving selected programs from the Department of State Health Services and the Department of Family and Protective Services to HHSC. DSHS will focus its efforts on core public health functions, and DFPS will focus on prevention and protective services. 9

HHSC Cont. Programs Administered by HHSC: - Medicaid - Children's Health Insurance Program (CHIP) - Healthy Texas Women - Temporary Assistance for Needy Families - SNAP Food Benefits and Nutritional Programs - Child Care Licensing - Family Violence Services - Refugee Services - Disaster Assistance - Foster Care 10

Department of State Health Services Texas Department of State Health Services Functions are Regulatory and Public Health Today, >12,000 employees –Responsible for administration of broad range of health care regulatory functions, including:  Division for Regulatory Services (EMS & Trauma Services; Hospital & other Health Care Facilities; Occupational Licenses and Permits Program; Radiation Control)  Division for Mental Health and Substance Abuse Services  Division for Disease Control  Division for Local and Regional Health Care Services  Center for Health Statistics (Hospital discharge and survey data)  Center for Vital Statistics 11

DSHS cont.  Texas Department of State Health Services –Under contract with Center for Medicare and Medicaid Services to perform Medicare certification surveys and investigate complaints or alleged violations of Medicare conditions of participation –Must conduct hospital compliance and validation surveys on behalf of CMS and issue reports on hospital compliance –Has authority to conduct hospital surveys to determine compliance with state hospital licensing rules –Has been given limited state appropriation to conduct hospital surveys and meet other regulatory obligations; CMS contract provides limited funding for TDSHS surveys

Other State Regulatory Agencies  Texas Medical Board  Texas Board of Nursing  Texas State Board of Pharmacy  Texas Department of Insurance  Texas Comptroller of Public Accounts  Texas Attorney General  Texas Commission on Environmental Quality  Texas Department of Public Safety  Texas Higher Education Coordinating Board  Texas Secretary of State

Federal Regulatory Agencies  U.S. Department of Health & Human Services –Agency for Healthcare Research and Quality –Centers for Disease Control and Prevention –Center for Medicare and Medicaid Services –Food and Drug Administration –Health Resources and Services Administration –National Institutes of Health –National Practitioner Data Bank –Substance Abuse and Mental Health Services Administration –Office of Inspector General Note: Medicare payment policies influence Medicaid and Private Payers Federal regulations standards used as basis for many state rules (key point!)

Other Federal Regulatory Agencies  U.S Department of Labor –Occupational Health & Safety Administration –Employee Benefits Security Administration  U.S. Department of Homeland Security  U.S. Department of Treasury –Internal Revenue Service  U.S. Department of Justice –Drug Enforcement Administration  Federal Trade Commission  Department of Veteran Affairs  U.S. Government Accountability Office

Hospital Oversight and Audits 16

How Agency Rulemaking Process Works  Regulatory agencies are responsible for implementation and enforcement of laws (generally after a legislative session); no authority to develop or enforce laws without legislative action/approval  Legislation can grant general or more specific authority to regulatory agencies; legislative history can influence content of agency rules  Legislation may require regulatory agency to seek input on rules from advisory committee  Regulatory agencies must comply with certain administrative procedures when developing rules (public notice of proposed rule; opportunity to provide comment; fiscal impact of rule; response to comments, rationale or justification for adopted rules)

How Agency Investigation Process Works  TDSHS Facility Compliance Group receives complaints against regulated health care facilities –Evaluates complaint allegations to determine whether potential violation exists; whether referral to another regulatory agency is appropriate –Investigates whether potential violation exists; typically conduct on-site unannounced survey if quality of care violations under review; billing complaints or other minor allegations investigated by mail –Agency staff allowed to enter facility premises to make inspection; have right to access all applicable records and staff –Agency staff must hold conference with facility administrator before survey begins and must hold exit conference to discuss any findings of alleged violation or deficiency and the severity of the deficiency –If deficiencies cited, facility must provide plan of correction –Agency staff must inform administrator of right to informal administrative review

How Agency Enforcement Process Works  Violations of state licensing requirements forwarded for review of potential enforcement action; violations of federal requirements forwarded to CMS regional office for enforcement action  Enforcement action may include administrative penalties or suspension or revocation of license/Medicare contract  If regulatory agency recommends enforcement action against a health care facility, the facility is given certain procedural rights –Notice of proposed enforcement action and statement of alleged facts or conduct that prompted enforcement action –Right to administrative hearing to challenge proposed enforcement action –Any hearings conducted pursuant to Administrative Procedures Act

Some Examples 20

Hospital Neonatal Designation  2011: HB 2636 created the NICU Council to look at increase in NICU beds, make report.  2103: HB 15 created Perinatal Advisory Council to develop mandatory designation process for neonatal and maternal care  2015: HB 3433 pushed back by one year the effective date of designation and added rural members to PAC –Neonatal Designation by 9/1/2018 –Maternal Designation by 9/1/

1115 Transformation Waiver  Born in 2011 from the state’s decision to expand managed care into Medicaid in $27 Billion budget deficit. Goal was to continue UPL funding in another format.  Waiver approved by CMS in December 2011 –MMC put in place –DSRIP and UC Pools Created –$29B All Funds  Waiver expires Sept  Renewed through Dec

Etc. Etc. Etc. Actively Follow at State Level:  Hospital Licensing Rules  Nursing Practice Act and Licensure  EMS and Trauma Rules  Hospital Data Reporting (THCIC)  Quality/Patient Safety (PAE, HAI)  Communicable Diseases  Newborn Screening  DSH and UC Rules  GME Funding and Planning Grants  DSHS Annual Survey 23

Key Agency Websites/Information Sources Texas Health and Human Services Commission  Medicaid/CHIPhttp://  Provider informationhttp://  Research/statisticshttp://  1115 Waiver Texas Department of State Health Services  License application  Complaint processhttp://  Enforcement actionhttp://  Licensing ruleshttp://  Health care datahttp://

Key Agency Websites/Information Sources Texas Board of Nursing  Licensure verificationhttp://  Nursing practice  Nursing peer reviewhttp:// Texas Medical Board  Licensing information  License renewals  Licensee resources Texas Board of Pharmacy  Pharmacy licensure  Pharmacist licensurehttp://  Complaint processhttp://

Key Agency Websites/Information Sources Center for Medicare & Medicaid Services  Medicare – generally  Medicaid – generallyhttp://  Regulations  State Operations Manual Items/CMS html?DLPage=1&DLSort=0&DLSortDir=ascending  State Operations Manual – Appendix, Hospital Conditions of Participation and Interpretative Guidelines Guidance/Guidance/Manuals/Downloads/som107_appendixtoc.pdf

Thank you. Jennifer Banda, J.D. Vice President Advocacy and Public Policy 512/