Bill Caption

Fiscal Notes

Bill Analysis

Summary: Some parties have noted that Medicaid fraud has been increasing in the emergency medical services industry. HB 3556 attempts to stop this fraud by creating barriers to entry in the emergency medical services industry and adding additional license requirements onto existing requirements.

• This bill requires a license applicant to provide a letter of credit from a federally insured bank.
• This bill requires a license applicant to provide a surety bond.
• This bill creates a designation called "administrator of record" that must submit to a criminal background check and must be a licensed health care professional in Texas.
• The administrator of record must be approved by the Department of State Health Services and is required to take continuing education courses administered by the Department.
• This bill requires a license applicant to provide the contact information of the administrator of record.
• This bill exempts government entities that provide emergency medical services from the new regulations.

Analysis: It is our general view that new regulations that increase barriers to entry are anti-competitive and work against a free market. It is also generally our view that businesses that accept Medicaid reimbursement for their services must be able to meet basic standards to ensure that they are not defrauding taxpayers. It is well known that Medicaid is wrought with fraud and abuse. HB 3556 has been proposed to deter Medicaid fraud in the emergency services industry. This legislation takes a good step in the right direction, albeit through onerous new regulation. This is designed to prevent fraudulent ambulance services from getting Medicare certified and then billing for services they should not.

We recognize that this legislation will protect taxpayers by cutting down on Medicaid fraud. On the other hand, this will prevent a significant barrier to entry for legitimate ambulance services. Due to this conflict between our principles of limited government and free markets, we are neutral on this legislation.