Jun 23, 2011

Special Session at Critical Point on Key Budget, Health Bills

TMA Legislative News Hotline

Thursday, June 23, 2011

The halls of the Texas capitol are quiet today because the House and Senate are not meeting again until Friday. With only four days left of the special session, lawmakers still have a lot of work to accomplish. First and foremost is to pass three bills to the balance the 2012-13 budget and carry out the spending cuts. Here is where the budget bills stand:

Senate Bill 1 generates about $3.5 billion for the next two-year budget. A few ways the bill creates additional nontax revenue for the 2012-13 budget are by:
  • Rewriting the school finance formulas to reduce entitlements to $4 billion;
  • Delaying part of the payment for state aid to schools to the next budget cycle;
  • Requiring one-time partial prepayment of sales, fuels, and alcohol taxes;
  • Extending the small business franchise tax exemption; and more.
The bill has been in conference committee this week. Conferees composed of five Senate and five House members debated which amendments that were added by the House to keep or not. At issue is whether the state should collect sales tax from online retailers who do business in Texas. Other amendments would:
  • Allow the state to guarantee charter school debt;
  • Authorize a superintendent to suspend the state testing for the 2011-12 and 2012-13 school years;
  • Provide for flexible school days; and
  • If a school district is owed more than is appropriated in the second year of a biennium, require the state to pay back the district the following year.
SB 2 also is in conference committee. The legislation would amend current law to appropriate $37 billion to the Foundation School Program for the 2012-13 budget. Money cannot be allocated to certain parts of government without the passage of this bill. At issue is a provision added by the House that would draw money from the Rainy Day Fund for the Foundation School Fund if the balance of the Rainy Day Fund exceeds the amount included in the comptroller’s certification.

The conference committee reports for SBs 1 and 2 are expected on Monday.

SB 7: The conference committee report for the omnibus health care bill was ready for approval by lawmakers earlier this week, but it hit a snag in the Texas House Tuesday over abortion-related provisions. House leaders are working to resolve the issue so they can approve the conference committee report and get it over to the Senate.

SB 7 is a key component of the budget puzzle. It would:
  • Establish a statewide plan to improve quality and increase efficiency by forming and regulating health care collaboratives;
  • Ensure physicians would have an equal say and vote in a collaborative’s governing board, and due process protections and the ability to participate in more than one collaborative arrangement in their community;
  • Create a new Medicaid and Children’s Health Insurance Program Quality-Based Payment Advisory Committee and program that would tie a portion of Medicaid HMO premiums to improved health outcomes and quality, and implement copayments in Medicaid to reduce unnecessary emergency department use;
  • Create more than $460 million for Medicaid by placing a premium tax on Medicaid managed care companies that are expanding to the Rio Grande Valley;
  • Protect patients from vaccine-preventable diseases in health care facilities, such as hospitals, by requiring them to implement vaccination policies to immunize their employees;
  • Establish the Texas Emergency and Trauma Care Education Partnership Program to ensure support of the trauma infrastructure in Texas; and
  • Allow Texas to participate in a multistate compact to help fund and administer Medicaid and Medicare.
Gov. Rick Perry threatened to call another special session yesterday if lawmakers don’t pass legislation to reform the Texas Windstorm Insurance Association (TWIA). In a statement sent out yesterday, the governor asked lawmakers to pass a bill that adequately compensates TWIA policyholders without enriching trial lawyers or further undermining TWIA’s financial stability. Lawmakers have struggled in the regular and special sessions to find a balanced approach for TWIA reform.

SB 28 by Sen. Rodney Ellis (D-Houston) is on the Senate calendar but has yet to be taken up. It would ban smoking in some public places and could save the state more than $30 million in Medicaid costs. It could come up when senators return on Friday. Stay tuned.

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