(a) Texas Health and Safety Code §314A.102, requires the Texas Health and Human Services Commission (HHSC) to conduct rate reviews for certain hospitals operating under a Certificate of Public Advantage (COPA).
(b) A hospital operating under a COPA pursuant to Texas Health and Safety Code §314A.056 may not change rates for hospital services without prior approval from HHSC.
(c) At least 90 days before the implementation of any proposed change in rates for inpatient or outpatient hospital services and, if applicable, at least 60 days before the execution of a reimbursement agreement with a third-party payor, a hospital operating under a COPA must submit to HHSC:
  (1) a completed rate review application as provided by HHSC;
  (2) any proposed change in rates for services that meet the definition in 25 TAC §133.2 of "inpatient services" or "outpatient services;"
  (3) a market analysis of current rates using geographical area;
  (4) a capital expenditures requirement beginning with the requested implementation date;
  (5) if applicable, any change in reimbursement rates under a reimbursement agreement with a third-party payor;
  (6) for an agreement with a third-party payor, other than an agreement described by paragraph (7) of this subsection, or in which rates are set under the Medicare or Medicaid program, information showing:
    (A) that the hospital and the third-party payor have agreed to the proposed rates;
    (B) whether the proposed rates are less than the corresponding amounts in the producer price index published by the Bureau of Labor Statistics of the United States Department of Labor relating to the hospital services for which the rates are proposed, or a comparable price index chosen by HHSC if the producer price index described by this paragraph is abolished; and
    (C) if the proposed rates are above the corresponding amounts in the producer price index, as described by subparagraph (B) of this paragraph, a justification for proposing rates above the corresponding amounts in the producer price index;
  (7) to the extent allowed by federal law, for an agreement with a managed care organization that provides or arranges for the provision of health care services under the Medicare or Medicaid program, information showing:
    (A) whether the proposed rates are different from rates under an agreement that was in effect before the date the applicable merger agreement took effect;
    (B) whether the proposed rates are different from the rates most recently approved by HHSC for the applicable hospital, if HHSC has previously approved rates for the applicable hospital following the issuance of the COPA under this chapter that governs the hospital; and
    (C) if the proposed rates exceed rates described by subparagraphs (A) or (B) of this paragraph, a justification for proposing rates in excess of those rates; and
  (8) any information concerning costs, patient volume, acuity, payor mix, and other information requested by HHSC.
(d) A hospital operating under a COPA shall provide any information requested by HHSC, or its designee, to HHSC or its designee no later than 10 business days after the request. If the hospital operating under the COPA does not provide the information HHSC requested within the 10-business-day time frame:
  (1) HHSC may deny the request due to insufficient time to review the information; or
  (2) HHSC may require the hospital operating under the COPA to amend the date of the proposed rate change.
(e) HHSC in its sole discretion may designate an individual or entity contracted with HHSC to review the provided materials and make a recommendation to HHSC.
(f) HHSC shall approve the proposed rate change if HHSC determines that:
  (1) the proposed rate change likely benefits the public by maintaining or improving the quality, efficiency, and accessibility of health care services offered to the public; and
  (2) the proposed rate does not inappropriately exceed competitive rates for comparable services in the hospital's market area.
(g) HHSC shall deny or modify the proposed rate change to meet requirements outlined in subsection (f) of this section, if HHSC determines that the proposed rate change does not satisfy subsection (f) of this section.
(h) Subject to subsection (d) of this section, HHSC will notify the hospital in writing of HHSC's decision to approve, deny, or modify the proposed rate change not later than the 30th day before the implementation date of the proposed change.

Source Note: The provisions of this §567.41 adopted to be effective October 25, 2020, 45 TexReg 7588; amended to be effective January 1, 2023, 47 TexReg 8724