Untitled Texas Attorney General Opinion ( 2013 )

ATTORNEY GENERAL OF TEXAS
GREG ABBOTT
January 29, 2013
The Honorable John J. Carona Opinion No. GA-0983
Chair, Committee on Business and Commerce
Texas State Senate Re: Whether the Medicaid reimbursement
Post Office Box 12068 methodology imposed by rule 354.1143 of the
Austin, Texas 78711-2068 Health and Human Services Commission
impermissibly conflicts with section 32.050(c)
of the Human Resources Code (RQ-1075-GA)
Dear Senator Carona:
You ask whether the Medicaid reimbursement methodology established by administrative
rule 354.1143 of the Health and Human Services Commission ("HHSC") impermissibly conflicts
with section 32.050(c) of the Human Resources Code. 1
Section 32.050 of the Human Resources Code governs benefits provided to individuals who
receive medical assistance under Medicaid who are also "eligible to receive similar assistance under
the Medicare program." TEX. HUM. RES. CODE ANN.§ 32.050(a) (West Supp. 2012) (entitled "Dual
Medicaid and Medicare Coverage"). 2 HHSC's administrative rules refer to such individuals as "dual
eligibles." 1 TEX. ADMIN. CODE§ 353.2(26) (2012). Subsection 32.050(b) of the Human Resources
Code directs HHSC to examine claims submitted for payment under Medicaid for services rendered
to dual eligibles "to ensure that payment is sought first under the Medicare program to the extent
allowed by law." TEX. HUM. RES. CODE ANN. § 32.050(b) (West Supp. 2012). Subsection
32.050(c), the subject of your question, states that "[f]or an ambulance service provided to a [dual
eligible, Medicaid] shall pay the Medicare deductibles and coinsurance." /d. § 32.050(c).
1
See Letter from Honorable John J. Carona, Chair, Senate Bus. & Commerce Comm., to Honorable Greg
Abbott, Tex. Att'y Gen. at 1 (Aug. 1, 2012), http://www.texasattorneygeneral.gov/opin ("Request Letter").
2
As one court has explained, "Medicaid is a federal-state assistance program, run by state governments within
federal guidelines, that pays for health care services provided to eligible recipients-low-income people of any
age-from federal, state, and local tax funds ." Hawkins v. Dallas Cnty. Hasp. Dist., 150 S.W.3d 535, 537 (Tex.
App.-Austin 2004, no pet.). "Medicare is a distinct medical insurance program run by the federal government that pays
for health care services provided to covered beneficiaries-primarily people over the age of 65, regardless of income,
and younger disabled and dialysis patients." !d. at 537 n.2.
The Honorable John J. Carona - Page 2 (GA-0983)
Section 354.1143 ofHHSC's rules provides that HHSC will pay a dual eligible's "Medicare
deductible and coinsurance as specified in this section." 1 TEX. ADMIN. CODE§ 354.1143(a) (2012).
Section 354.1143(b) provides the methodology for paying certain deductible and coinsurance:
(b) Except as otherwise specified in subsections (c) and (d) of this
section, the payment of the Medicare ... Part B ... deductible and
coinsurance is based on the following.
( 1) If the Medicare payment amount equals or exceeds the
Medicaid payment rate, HHSC does not pay the Medicare deductible
and coinsurance on a crossover claim.
(2) If the Medicare payment amount is less than the Medicaid
payment rate, HHSC pays the Medicare deductible and coinsurance
on a crossover claim, but the amount of payment is limited to the
lesser of the deductible and coinsurance or the amount remaining
after the Medicare payment amount is subtracted from the Medicaid
payment rate.
!d. § 354.1143(b). Subsection 354.1143(d) allows higher cost-sharing payments to providers of
certain services to dual eligibles if HHSC determines the higher payment "is necessary to ensure
adequate access to care or is more cost-effective to the state." !d. § 354.1,143(d).
An agency's rule is presumed to be valid. Vista Healthcare, Inc. v. Tex. Mut. Ins. Co., 324
S.W.3d 264, 273 (Tex. App.-Austin 2010, pet. denied). However, an agency may not adopt a rule
that is contrary to relevant governing statutes. State v. Pub. Util. Comm'n, 131 S.W.3d 314, 321
(Tex. App.-Austin 2004, pet. denied). Courts give some deference to an agency's interpretation
of its rules "unless it is plainly erroneous or inconsistent with the language of the statute, regulation,
or rule." TGS-NOPEC Geophysical Co. v. Combs, 340 S.W.3d 432,438 (Tex. 2011). To determine
whether an agency rule exceeds statutory authority, courts generally look first to the statute's plain
and common meaning. Fulton v. Assoc. Indem. Corp., 46 S.W.3d 364,369-70 (Tex. App.-Austin
2001 pet. denied).
Section 32.050(c) of the Human Resources Code requires Medicaid to pay the Medicare
deductibles and coinsurance for an ambulance service provided to a dual eligible. TEX. HUM. REs.
CODE ANN.§ 32.050(c) (West Supp. 2012). Rule 354.1143, by contrast, purports to permit HHSC
to decline to pay the Medicare deductibles and coinsurance in some cases for ambulance services
provided to a dual eligible. See 1 TEX. ADMIN. CODE§ 354.1143(b) (2012). The rule therefore
conflicts with the statute. HHSC has indicated that article II, section 17 of the 2012-2013
Appropriations Act prompted its amendment to rule 354.1143. See 36 Tex. Reg. 7057-58 (2011)
(stating the rule was amended "pursuant to the 2012-2013 General Appropriations Act"), adopted
36 Tex. Reg. 9282-84 (2011) (codified at 1 TEX. ADMIN. CODE§ 354.1143) (Tex. Dep't of Human
Servs.); see also General Appropriations Act, 82d Leg., R.S., ch. 1355, art. II,§ 17, 2011 Tex. Gen.
The Honorable John J. Carona - Page 3 (GA-0983)
Laws 4025, 4242 (the "Appropriations Act"). Article IT, section 17 of the Appropriations Act,
however, merely provides in tabular form: "Sec. 17. Additional Cost Containment Initiatives.
Included in appropriations above to the health and human services agencies in Article IT of the Act
are reductions for anticipated savings for the following cost containment initiatives ... Health and
Human Services Commission ... Medicare Equalization ... $295,750,000 [estimated general
revenue savings] ... $704,166,667 [estimated savings for all funds]." Appropriations Act at 4242.
The Appropriations Act does not purport to alter HHSC's obligation to comply with section
32.050(c) of the Human Resources Code or authorize HHSC to depart from the statute's
requirements. In any event, under the Texas Constitution, a rider in an appropriations act cannot
amend substantive law. Strake v. Ct. App.for First Sup. Jud. Dist., 704 S.W.2d 746, 748~9 (Tex.
1986). HHSC remains bound by the requirements of section 32.050(c) regardless of the contents of
an appropriations rider regarding cost containment.
By enacting section 32.050(c) of the Texas Health and Safety Code, the Legislature chose
to obligate HHSC to pay deductibles and coinsurance for ambulance services provided to dual
eligibles. Section 354.1143 ofHHSC' s rules, however, provides for the payment of deductibles and
coinsurance for dual eligibles in some circumstances but not in others, and gives HHSC discretion
in some circumstances to pay an amount higher than the statutory methodology would produce.
I TEX. ADMIN. CODE§ 354.1143(b) (2012). To the extent that section 354.1143(b) ofHHSC's rules
limits HHSC's obligation to pay Medicare deductibles and coinsurance for an ambulance service
provided to a dual eligible, a court would likely conclude that the rule conflicts with section
32.050(c) of the Texas Human Resources Code.
The Honorable John J. Carona - Page 4 (GA-0983)
SUMMARY
To the extent that section 354.1143(b) of the Health and
Human Services Commission's rules limits the Health and Human
Services Commission's obligation to pay Medicare deductibles and
coinsurance for an ambulance service provided to a person eligible
for both Medicare and Medicaid benefits, the rule conflicts with
section 32.050(c) of the Texas Human Resources Code.
Very truly yours,
DANIEL T. HODGE
First Assistant Attorney General
JAMES D. BLACKLOCK
Deputy Attorney General for Legal Counsel
JASON BOATRIGHT
Chairman, Opinion Committee
William A. Hill
Assistant Attorney General, Opinion Committee