TITLE health-services

Part II. Texas Department of Mental Health and Mental Retardation

Chapter 401. System Administration

Subchapter B. Interagency Agreements

25 TAC §401.58

The Texas Department of Mental Health and Mental Retardation (TDMHMR) proposes an amendment to §401.58, concerning Interagency Agreements. The section adopts by reference rules of the Texas Department of Human Services (TDHS) in 40 TAC §72.501 (relating to Memorandum of Understanding Concerning the Capacity Assessment of Persons Who are Elderly and Persons with Mental Retardation and/or Developmental Disabilities) to which TDHS is contemporaneously proposing amendments in this issue of the Texas Register .

The TDHS amendments constitute changes to a memorandum of understanding (MOU) between TDHS and TDMHMR as required by the Texas Health and Safety Code, §533.044. The TDHS amendments define who may initiate and administer the assessment tool and require both agencies to: write a final report on the results of the capacity assessment tool pilot study, develop the final version of the assessment tool, and implement use of the tool at nursing facilities which are licensed by TDHS and at residential service facilities which contract with or are operated by TDMHMR.

Donald C. Green, chief financial officer, has determined that for each year of the first five-year period the amendment as proposed is in effect there will be an insignificant expense to state government as a result of administering the provisions of the MOU. Approximately $1,750 per year will be necessary for TDMHMR to cover document printing costs and travel costs for trainers.

Don Gilbert, commissioner, has determined that for each year of the first five years the amendment as proposed is in effect the public benefit anticipated as a result of enforcing the MOU is the provision of a uniform and thorough process for evaluating the need of a individual residing in a residential service facility for a guardianship referral to probate court. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the amendment as proposed.

Written comments on the proposal may be sent to Linda Logan, director, Policy Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 12668, Austin, Texas 78711-2668, within 30 days of publication. Questions regarding the content of the proposal may be directed to Pat Craig, Longterm Services and Supports, 512/206-4603, or Cynthia Medlin, Consumer Services and Rights Protection, 512/206-5776..

The amendment is proposed under the Texas Health and Safety Code, §532.015, which provides the Texas Mental Health and Mental Retardation Board with broad rulemaking authority, and with §533.044, which requires the MOU to be adopted by rule.

Texas Health and Safety Code, §533.044 is affected by this proposed amendment.

§401.58.Uniform Assessment Tool for Assessing Decision-making Capacity.

(a)-(b)

(No change.)

(c)

Copies of the MOU are filed in the Office of Policy Development, TDMHMR, 909 West 45th Street [4405 North Lamar], Austin, Texas 78756, and may be reviewed during regular business hours.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Issued in Austin, Texas, on February 3, 1997.

TRD-9701498

Ann Utley

Chair, Texas MHMR Board

Texas Department of Mental Health and Mental Retardation

Proposed date of adoption: April 1, 1997

For further information, please call: (512) 206-4516


Part XVI. Texas Health Care Information Council

Chapter 1301. Health Care Information

Collection and Release of Hospital Discharge Data

25 TAC §§1301.11-1301.19

The Texas Health Care Information Council proposes new §1301.11-1301.19, concerning the collection and release of hospital discharge data. Specifically, the sections define terms used in the collection and release of hospital discharge data; establish rules for collection of hospital discharge data; establish rules for filing discharge reports; establish rules for exemptions from filing requirements; establish rules for acceptance of discharge reports and correction of errors; establish rules for certification of discharge reports; establish rules for hospital discharge data release; and establish rules for discharge reports, including records, data fields, and codes. These new rules will facilitate implementation of the statewide health care data collection system mandated by the Legislature in House Bill Number 1048, of the 74th Legislature, codified in Title 2, Health and Safety Code, §108.1-108.15, to collect health care charges, utilization data, provider quality data, and outcome data to facilitate the promotion and accessibility of cost-effective, good quality health care.

The Texas Health Care Information Council has determined that for the first five-year period the sections are in effect there will be fiscal implications. The costs to state government may average up to $450,000 per year. A portion of these costs may be recaptured through revenues generated by user fees for products produced through implementation of these rules. The revenues to be generated through user fees are expected to be positive but as yet undetermined. There will be no fiscal implications for local governments except to the extent that local governments operate hospitals that are required to submit data per these rules.

The Council has also determined that for each year of the first five years the sections are in effect, the public benefits anticipated as a result of enforcing and administering the sections will be public access to hospital discharge data regarding health care charges, utilization data, provider quality data, and outcome data to facilitate the promotion and accessibility of cost-effective, good quality health care; to provide an information and data source for providers, consumers, purchasers, and policy makers alike; to promote informed decision making in providing, utilizing, and purchasing health care and for developing and implementing health care policy throughout the state; and to provide a means of benchmarking throughout the state to promote continuous quality improvement by providers to ensure good quality, accessible health care to the citizens of Texas.

There will be additional, marginal costs to providers as they will be required to provide data on all, as opposed to most, patients admitted to their hospitals and the information required is expanded. Few, if any, of the hospitals required to submit data under this rule can be classified as small businesses. The potential for these increased costs have been mitigated by utilizing formats and processes currently in existence and through integration and consolidation with other health care data systems. Under the proposed rule, all hospitals shall file discharge reports by electronic filing (tape, diskette or modem) unless the hospital receives an exemption letter from the Council. The following findings were utilized by the council when writing these rules.

(1) Electronic filing of UB-92 bills with payors by hospitals is the normal business practice in the hospital industry.

(2) Electronic filing of UB-92 bills with payors by hospitals offers significant economic advantages to hospitals and payors in reducing errors, reducing processing costs and speeding payments.

(3) Available computer software and service bureaus usually make electronic filing of UB-92 bills more economical than filing paper UB-92 forms for most hospitals.

(4) Hospitals with the capability to electronically file UB-92 bills with any payor usually have the capability to electronically file discharge files with the council for all patients discharged.

(5) Electronic filing of discharge reports by hospitals to satisfy the council's data collection requirements is less costly for the council and less costly for most hospitals than filing paper UB-92 forms.

The Texas Department of Health, Texas Hospital Association, Blue Cross/Blue Shield, health data organizations in 17 states, and 46 hospitals within the State of Texas were contacted for information regarding provider costs in providing data and information required on uniform billing (UB) form 92 (the format required by these rules). These entities reported a range of costs, from 2 to 3 cents per discharge up to 75 cents per form submitted. For providers that have discharge data bases which are similar to that required for completion of the UB form 92 and which are fully computerized, the cost averages 2 to 3 cents per patient discharged from the hospital; for those that have systems which are not fully computerized or which do not maintain data bases similar to that required for completion of the UB form 92, the cost averages 50-55 cents per hospital discharge; and for those that have little or no computer support and process all claims manually, the cost increases to about 75 cents per hospital discharge. To the extent that hospitals are not currently collecting all of the data required by these rules, they may incur additional costs. Similarly, to the extent that hospitals utilize outside vendors, they may incur additional costs. As a consequence, the financial impact will be most significant on small hospitals with little or no automated data processing capability. For all of the hospitals required to submit data under these rules within the State of Texas, the total cost is expected to be approximately $326,000 per year. There is no anticipated effect on local employment.

Comments on the proposed rules may be submitted to Nelda P. Wray, M.D., M.P.H., Chairperson, Texas Health Care Information Council, 4900 North Lamar, OOL-3407, Austin, Texas, 78751-2399, (512) 424-6492. Comments will be accepted for 30 days following publication of this proposal in the Texas Register . In addition, a public hearing on the proposed sections will be held at 9:00 a.m., Monday, March 3, 1997, in the Brown-Heatly Building, Room 1410, 4900 North Lamar, Austin, Texas 78751-2399.

A previous version of this proposed rule was published in the August 23, 1996, issue (21 TexReg 7939). Prior to that date, copies of the proposed rule were mailed to all Texas hospitals and other interested parties by the council. A public hearing was held on August 26, 1996, in Austin at which nine people presented oral testimony. During the 30 day comment period following publication of the proposed rule, written comments were received from 53 individuals and organizations. Members of the council have also met informally with representatives of affected interest groups to receive additional input.

Individuals and organizations presenting testimony at the public hearing were: Mr. Ed Berger representing the Seton Health Network, Mr. John Bergin representing St. Joseph's Regional Health Center, Dr. Earl Matthew representing the Texas Medical Association, Mr. Bob Tippens representing Scott & White Hospital and Texas HIMA, Ms. Ann Heiligenstein representing the Conference of Catholic Health Facilities, Ms. Pam McNutt representing Methodist Hospitals of Dallas, Mr. Jay Sherler representing the Providence Health Center, Mr. Joe DaSilva representing the Texas Hospital Association, and Mr. Gary Barton representing HCIA.

Individuals and organizations submitting written comments during the comment period were: Dennis Newquist (Abilene Regional Medical Center); Gerry Brueckner (Baylor Center for Restorative Care); Mark Hood (Baylor Medical Center at Grapevine); Ronald L. Boring (Baylor/Richardson Medical Center); Joel Allison (Baylor University Medical Center); David P. Brown (Citizens Medical Center); Michael Morris (Coleman County Medical Center); Russell Meyers (Columbia Bayshore Medical Center); Richard Harwell (Columbia Navarro Regional Hospital); Sally Jeffcoat (Columbia Spring Branch Medical Center); Norman Powers (Comptroller of Public Accounts); Earl B. Matthew, M.D. (Texas Medical Association); Gary D. Brock (Baylor Medical Center at Garland); Robert A. Pascasio (Memorial Hospital); Judy Huffman (Good Shepherd Medical Center); John Haas (Greater San Antonio Hospital Council); John Froehlich (HCIA), Christy Francis (Hemphill County Hospital); Buddy Edwards (Hillcrest Baptist Medical Center); Ken Blankenship, Robert O. Langland, E.L. Langley, Marilyn Keene-Milligan, Elizabeth R. Propp, and H.J. Macfarland (Irving Healthcare System); John Hornbeak (Methodist Healthcare System); Ann Timpe-Brennan and Lisa L. Dahm (Memorial Hospital System); Pamela G. McNutt (Methodist Hospitals of Dallas); Judy Novak (Park Plaza Hospital); Kent A. Keahey (Providence Health Canter); Robert M. Tippens (Scott & White); W. Edward Berger (Seton); Gail M. Oberta and Mary Klock (Shoal Creek Hospital); Monty McLaurin (St. Joseph's Hospital and Health Center); Susan Rudd Wynn, M.D. (Tarrant County Medical Society); Jim Biltz (Tenet HealthSystem); David R. Smith, M.D. (Texas Department of Health); Jack Harrington (Texas Department of Mental Health and Mental Retardation); Robert M. Tippens (TX HIMA); Jim Houdek, Joe DaSilva and Hugh Lamensdorf, M.D. (Texas Medical Association); James Houdek (Texas Hospital Association); Terry Boucher (Texas Osteopathic Medical Association); Todd Brown (Texas Workers' Compensation Commission); John Mendelsohn. M.D. (The University of Texas MD Anderson Cancer Center); James C. Guckian, M.D. (The University of Texas System); J. Michael Lee (Baylor Medical Center-Ellis County); Richard J. Hausner, M.D. (Harris County Medical Society); Joanne Turnbull (Hermann Hospital); Richard D. Arnold (Medina Community Hospital and Medical Clinics); John G. Bergin (St. Joseph's Services Corporation); Don A. Beeler (St. Michael Health Care Center); John A. Guest (University Health System); and Di M. Dooley (Wilford Hall Medical Center).

The council's hospital discharge data committee discussed the comments at its October 24, 1996, meeting in Houston. The full council discussed the comments and voted on responses to the comments and associated changes to the proposed rule at its meetings on October 28 and November 25, 1996, in Austin. The council determined that sufficient modifications to the proposed rule were required that it would be inappropriate to move to final adoption of a rule without withdrawing the initial proposed rule and publishing a revised proposed rule for public review and comment. Therefore at the January 27, 1997, meeting the council formally withdrew the August 26 proposed rule from further consideration.

In order to document the council's decisions regarding the development of this rule, it has prepared a response to the comments received on the August 26 proposed rule and incorporates them into this preamble. Section references in this response are to the August 26 version of the proposed rule.

Comments Related to Specific Sections of the August 26 Proposed Rule

Section 1301.11 Definitions. The Council accepted comments from the Texas Department of Health (TDH) regarding the need to include TDH in the rule definitions and to conform the definitions of "physicians" and "providers" to those found in the statute. Accepting these comments required creation of another term, "Other Health Professionals," to cover persons who are not "physicians" as defined in the statute, but who may be reported by providers as having admitted or treated patients in certain circumstances.

Concerns were expressed by the Texas Department of Mental Health and Mental Retardation that federal statutes and regulations restricting the release of information on psychiatric and substance abuse patients might prevent hospitals from supplying information on these patients, and thus require changes in the definition of "Inpatient." The council has secured an opinion from TDH legal counsel that no change is necessary to comply with federal law. The relevant law (42 U.S.C. §290dd-2) does not restrict disclosure of records "to qualified persons for the purpose of conducting scientific research, management audits, financial audits or program evaluation...." In the opinion of legal counsel, THCIC comes within this category.

Section 1301.12(b) Number of Discharge Records per Patient. The proposed rule called for one discharge record per patient. This requirement would require hospitals to do additional data processing in four circumstances: (1) for live deliveries where only one UB-92 is currently generated with the mother as patient, the hospital would be required to generate a second discharge record for the newborn; (2) for patients where the hospital issues interim bills and a final bill, the hospital would be required to create a single consolidated discharge record; (3) for patients moved from an acute care bed to a DRG-exempt unit the hospital would be required to create a single consolidated discharge record; and (4) for patients for which the hospital does not currently generate a bill because of a judgment by the hospital that no payment will occur, the hospital will be required to generate a discharge record when they might not have generated a UB-92. Multiple hospitals objected to the additional data processing required by these aspects of the proposed rule as increasing their costs and being otherwise burdensome. The council responds to these comments as follows:

The proposed rule has been revised to eliminate the requirement that the hospital create a separate discharge record for a healthy newborn if a separate bill was not required by the payor. The council believes that the data elements requested are sufficient to allow the council to create separate discharge records for healthy newborns where necessary. On this point, the revised rule requires the hospital to submit the data in the form required by the payor.

The proposed rule has been revised to eliminate the requirement that for patients where the hospital has issued interim and final bills that those bills be consolidated into a single discharge record. Under the revised rule the council will accept interim and final discharge records and will make the necessary consolidations to produce a single discharge record for analytical purposes. On this point, the revised rule requires the hospital to submit the data in the form required by the payor.

One hospital asked how hospitals were to report patients who were served in the acute care portion of a hospital and were then transferred to a DRG-exempt unit of that hospital. Such units could be skilled nursing units, psychiatric units, comprehensive medical rehabilitation units or long-term care units. The answer depends upon the payor. The majority of these patients are Medicare patients. Medicare requires that the hospital bill separately for the patient's acute care admission and for the admission to the DRG-exempt unit. The hospital should therefore submit to the council a separate discharge record for the admission to each unit or facility. The council will use the data elements on both records to assign a unique patient identifier to provide a clear picture of the overall inpatient episode. Other payors may require the hospital to provide a single bill for the total stay. If so, the hospital would provide the council with one discharge record. We believe the data elements on the record (e.g. revenue codes, conditions and occurrence codes, etc.) will allow proper interpretation of the data for analytical purposes. This approach will minimize any data processing burden on the hospitals. The council has also provided that for each patient record on the public data tapes that acute and subacute care days will be separately reported.

The council does not agree with the comments of numerous hospitals who commented that hospitals should not be required to submit discharge records on self-pay and charity care patients for whom a UB-92 had not been sent to any payor. Some hospitals indicate that such patients are 15% to 25% of their total patients. One hospital commented that it currently uses a vendor to take its data and process the data to the HCFA 1450 format. The hospital pays the vendor a charge per record reformatted. At present only records to be billed electronically are sent to the vendor. Using the vendor to prepare records for the council on patients not currently billed electronically will increase payments to the vendor and hence increase hospital costs. The particular hospital indicates this would increase the number of records processed by its vendor by 20-25%. First, we do not believe that the generation of the required data elements in the proposed rule will, in fact, generate substantial additional expenses for hospitals. The required data elements are ones that hospitals must collect on all patients regardless of payment source (e.g. name, age, diagnosis, procedures, attending physician, disposition at discharge, detailed charges, etc.). These data are utilized for quality assurance, scheduling, medication management and many other operational functions of the hospital. Hospitals do not have one data system for insured patients and a separate data system for uninsured patients. In creating a bill or discharge record for a hospital inpatient, the hospital's data system draws data elements from various data systems in the hospital. The billing system may filter out patients for whom no payor has been identified, but the data is there to create the bill. In fact, many uninsured patients receive bills for inpatient hospital services and the hospital obtains partial, if not total, payment from these patients. The additional expense is likely to be limited to a small additional charge per record from a vendor .

Even if the creation of discharge records for uninsured or charity care patients does generate incremental expense for hospitals, the council believes the expense is justified by the benefit of having a complete data base for the hospital and for the community in which the hospital operates. The Legislature mandated the council to "...develop a statewide health care data collection system to collect health care charges, utilization data, provider quality data, and outcome data to facilitate the promotion and accessibility of cost-effective, good quality health care." (§108.006) We cannot carry out this mandate by looking only at the health service delivered to insured patients when we know that Texas has one of the highest percentages of uninsured patients of any state. We note that the private discharge data system operated by the Texas Hospital Association requires participating hospitals to submit discharge records on all patients.

However, the council believes that it is necessary to specify what data elements are required for each patient. Therefore the council has revised the proposed rule to require submission of a minimum data set (MDS) on all patients. The data elements in this minimum data set closely follow the recommendations of the Texas Hospital Association, with some additional elements necessary for the assignment of unique patient and physician identifiers. The revised rule also requires the submission to the council of all other UB-92 data elements for a patient submitted by the hospital to a third party payor. The council requests that hospitals provide specific, quantitative comments on any incremental data processing problems or financial costs they would incur because of this requirement to submit discharge records on patients for which they do not currently prepare a UB-92 for a payor.

Section 1301.12(c) Provisions Requiring Electronic Filing of Discharge Records. Some hospitals objected to the requirement that discharge records be filed electronically unless the council granted an exemption based on the hospital's inability to file electronically. One commenter suggested the rules as proposed exceeded the council's statutory authority. The council declines to revise the proposed rule in response to these comments. House Bill 1048 clearly gives the council the legal authority to require electronic submission of data in most cases. In §108.009(a) the council is instructed by the Legislature that "The data shall be collected...using electronic data processing, if available. Later in §108.009(I), the Legislature instructs: "The council shall develop by rule reasonable alternate data submission procedures for providers that do not possess electronic data processing capacity." The council interprets §108.009 to require us to collect hospital discharge data by electronic means whenever possible, but to define alternative means for hospitals that do not possess the necessary capacity. §1304.13 of the proposed rule defines three methods of filing discharge reports: (1) tapes or diskette, (2) by electronic data interchange and (3) on paper forms. We have therefore complied with the statute by defining alternative submission procedures for those who cannot file electronically.

This leaves the question of determining which hospitals do not possess electronic data processing capacity. We defined the criteria for answering the question in §1301.15(a)(3). We defined the procedures for a hospital to show it did not possess the capacity to file electronically in §1301.15(b). None of the comments suggested that the criteria or the exemption process were unreasonable or suggested alternatives. We believe the proposed rule follows the statute and requires no revision.

The council reaffirms its findings that electronic filing is the most economical means of data submission for both hospitals and the council. The council requests that hospitals provide specific, quantitative comments on any incremental data processing problems or financial costs they would incur because of this requirement to submit discharge records electronically rather than on paper. The council further requests that if hospitals disagree with the exemption criteria that they explain their disagreement and suggest alternative criteria.

Section 1301.12(d) For a summary and discussion of the comments received on the prescribed data submission format see comments related to §1301.19.

Section 1301.12(g) Review of Hospital Documents and Records. The council wishes to clarify that it has no intention of routinely inspecting hospital documents and records. The reviews covered by this section of the proposed rule would occur only when necessary to verify the accuracy and/or completeness of data submitted by a hospital. One commenter suggested that the council pay the cost of copying any hospital records it requested pursuant to §1301.12(g). The Texas Hospital Association (THA) suggested that this section more closely track the statutory language in §108.007(a) regarding the role of the Texas Department of Health (TDH). Another noted that any reviews of medical records could be costly to the hospital and impose an administrative burden. This section of the proposed rule complies with the statute. Any review of records by the council is in the nature of an audit of the hospital for the enforcement of the statute and the verification of the data. We do not believe it is customary for the State to pay for copies of records in this situation and decline to do so. On the other hand, the council does not propose to charge a hospital for the time or expense of state employees required to conduct a review. We believe the proposed rule provides the "reasonable rules and guidelines" mentioned in the statute. We believe the reference to TDH refers to TDH's duty under §108.008(b)(1) and (2) to assist the council as part of an interagency contract and need not be mentioned in the rule.

Section 1301.13(a) and (b) Schedule for Filing Discharge Reports. One hospital requested that the deadline for submission of the discharge records for a calendar quarter be extended from two months to three months. Several hospitals did not believe they could provide the initial data submission for discharges during the fourth quarter of 1996 because of set-up requirements and a lack of final rule from the council. THA commented that the statute requires the council to test systems for collection of data and to proceed in stages to build the statewide data system. THA recommended that all of 1997 be considered a test period for development of systems. Another hospital requested that hospitals be given a minimum of six months from the time the rules are adopted to prepare to collect the required data.

The council agrees there is a need to build the data system in phases and to test the system. The first phase is the collection of hospital discharge data. We have delayed collection of hospital outpatient and emergency room data and data from other outpatient facilities until this part of the system is operational. We have made provisions for the orderly testing of the system. We cannot begin to test until we have data to test.

The council has revised the proposed rule to provide that no hospital will be required to submit any data until a minimum of 90 days after the effective date of the rule. As test data the proposed rule now requires hospitals to submit a minimum of 30 days and a maximum of 90 days of discharges occurring in the period January 1 to March 31, 1997. The test data must be submitted within 90 days after the effective date of the rule or by May 30, 1997, which ever occurs later. This data will be used only for internal testing. To prevent its release no public use data file will be created from this data (See §1301.18(c)(1)(C)). Data for test purposes is drawn from patient discharges occurring in the first quarter of 1997. Data for discharges occurring in the second quarter of 1997 will not be collected for testing or actual reporting purposes.

The council has further revised the proposed rule to begin collection of discharge data for ultimate release with discharges occurring on or after July 1, 1997. To provide additional time for testing prior to release of public use data, §1301.18(c)(1)(D) provides that data for the third quarter of 1997 will not be released until data for the fourth quarter of 1997 is available which would be in August 1998. This appears to offer ample opportunity for testing and development of the system while not unnecessarily delaying availability of data to state government and the public.

The rule should not require significant information system modifications by hospitals. As revised, the rule requires hospitals to submit for insured patients the social security number and only those data elements already required by the payors on each specific discharge. For uninsured patients, the revised rule requires only the minimum data set (MDS). The rule does not require the collection of race and ethnicity on discharges before January 1, 1998. (See discussion under §1301.19.) Therefore for discharges during all of 1997, hospitals are being asked to submit National Uniform Billing Committee standard data elements in the HCFA National Standard Format. The only additional data element is the patient social security number

In arriving at the requirement that hospitals submit and certify their discharge records by 60 days after the end of the quarter, the council consulted with the National Association of Health Data Organizations regarding the practices in other states operating similar hospital discharge collection systems. The 60 day period appears reasonable.

Section 1301.13(d) Civil Penalties for Failure to File. The statute at §108.014(b) states, "A person who fails to supply available data under Sections §108.009 and §108.010 is liable for a civil penalty of not less than $1,000 or more than $10,000 for each act of violation. Several commenters felt the mention of civil penalties in the rules was harsh and not consistent with the cooperative environment that the council seeks to develop with health care providers. The council included these references to civil penalties to give fair notice to all concerned of the Legislature's action. The application of such penalties is not automatic. The statute provides that the attorney general would seek such penalties only at the request of the council. The council has no intention of resorting to enforcement actions except as a last resort when all other efforts to obtain cooperation and compliance with the rules have failed. We are mindful that at the start of every data collection program like this there is much trial and error. We are interested in fixing problems, not in fixing blame.

Section 1301.14(a) Magnetic Media. One hospital requested that tape cartridges be listed as an acceptable medium. The council believes the use of certain tape cartridges are accommodated under §1301.14(a)(1)(C). There are many types of tape cartridges and similar storage devices and we need to be sure we have the hardware to read what a hospital chooses to send.

Section 1301.14(a) - (c) Notice of changes in instructions for filing Discharge Reports. Several commenters requested 90 days notice of changes in council procedures instead of the 30 days notice in the proposed rule. This change has been made in the revised rule.

Section 1301.15(a)(1) Exemption as a Rural Provider. Several commenters objected to the section of the proposed rule that requires a hospital to apply for exemption as a rural provider. The commenters observed that the council should be able to use census data to determine which hospitals were eligible for this exemption and notify the hospitals rather than requiring them to file exemption requests.

The council agrees that it can make an initial determination of which hospitals qualify for exemption as a rural provider as new census data becomes available. An initial determination has been made by the State Census Data Center at Texas A&M University. The results will be published by the council. The rule will be revised to indicate that the executive director will make this determination at least annually and notify hospitals as to who is and is not exempt as a rural provider. Hospitals that lose the exemption will be required to begin submitting data for discharges occurring in the next reporting period that begins 90 days or more after the date of notice of loss of the exemption. The council will maintain a procedure where a hospital which believes it has been erroneously denied this exemption can appeal the determination.

Section 1301.15(b) Information Considered by the council in Appeals of Exemption Decisions. One commenter objected to the provision of the exemption appeals procedure whereby in an appeal of the decision of the executive director to the council it will consider only information presented to the executive director. We disagree with this comment. If the hospital has additional information relevant to its exemption that the executive director has not seen, it should first be submitted to the executive director, not to the council. The executive director may change his/her mind on the basis of the additional information, eliminating the need for the council to consider the matter.

Section 1301.16(d) Documentation of Edits. One commenter requested that all edits and acceptance criteria to be applied to discharge reports be incorporated into the text of the rule. The council declines to do so. We do not believe this is practical or required by the Administrative Procedures Act. As stated in the proposed rule we will make copies of all edits and error messages available to hospitals. We will revise the rule to provide computer code only if it is the property of the council.

Section 1301.17(a) Certification of Discharge Reports. Several hospitals commented that the hospital CEO or CFO should not be responsible for certification of the accuracy and completeness of discharge reports. Some indicated the council lacked the statutory authority to require such a certification. We disagree with these comments. We believe §108.007(a) provides the necessary authority. As with other governmental filings we believe a top executive officer of the organization should provide the certification so that there is awareness and accountability by top management. The council has revised the proposed rule by deleting the second sentence.

Section 1301.17(b) Opportunity for Physician Review of Hospital Discharge Records. The Texas Medical Association (TMA) commented that the proposed rule provides the hospital the opportunity to review and verify discharge data, but does not provide the admitting and treating physicians the same opportunity. We have revised this section to require the hospital to provide all their physicians a reasonable opportunity to review the discharge records prior to certification and to file comments along with the certification if a physician disagrees with the hospital concerning the accuracy of a discharge record.

Section 1301.18(b)(5) and (10) Masking of Admission and Discharge Dates. The Texas Workers' Compensation Commission (TWCC) commented that the removal of actual admission and discharge dates from the public use data tape would reduce its utility and recommended leaving exact dates in place. The council declines to accept this comment in order to protect patient confidentiality. Admission and discharge dates will be replaced by length of stay on the public use data tape and a code for day of the week of the admission. Procedure dates will be replaced by day of stay. Patient birth date will be replaced by age. The user will know in which quarter of what year the discharge occurred. Based on the experience of other state health data commissions, we believe the data, with these substitutions remains very useful and patient confidentiality is enhanced.

Section 1301.18(b)(7) Inclusion of Uniform Patient Identifier on the Public Use Data File. Based on the analysis of comments regarding the inclusion of the uniform patient identifier on the public use data file (see as follows), the council has determined that §108.013(c)(1) precludes us from including the uniform patient identifier in the public use data file because any hospital could use it to deduce the identity of a patient and track the care of that patient at other facilities. While §108.013(b) of the statute seems to suggest that the council give providers access to uniform patient identifiers and have them assign them, we do not intend to do so. Rather, the council intends to generate the list of uniform patient identifiers and match them to newly received discharge records to protect patient confidentiality. We do not believe §108.013(c)(1) precludes the council from utilizing the uniform patient identifier in analysis performed by the council.

Section 1301.18(b)(12) Inclusion of Uniform Physician Identifier on Public Use Data File. Several hospitals commented that there was only one physician at their hospital performing certain procedures and that even if an arbitrary code was utilized that the physician could be easily identified from that code. The commenters expressed concern that confidentiality promised to physicians in the statute may be compromised by the release of physician identifiers through public use data files or through council reports. The council acknowledges the problem raised by the comment. The statute under §108.011(c) requires the council to assign a Uniform Physician Identifier rather than identify a physician by name. Section §108.013(c) then provides that "Unless specifically authorized by this chapter, the council may not release and a person or entity may not gain access to any data...that could reasonably be expected to reveal the identity of a...physician...." Assuming there are situations where a physician's identity could be deduced from the Uniform Physician Identifier, the only specific authorization is found in §108.010(h) which provides: "A quality outcome data report...must identify the physician by the uniform physician identifier...."

Given the public use data file as specified in the proposed rule, any hospital could deduce the Uniform Physician Identifiers for all physicians on its medical staff, thus revealing their identity and enabling the hospital to track the physician's activities at other hospitals. Therefore we will revise the proposed rule to exclude the uniform physician identifier from the public use data file.

Section 1301.18(c)(1) Release of Public Use Data Tapes. Numerous commenters opposed the release of public use data files and/or statistical compilations based on those files. The objections to release of the public use data file to the public apply whether or not the records include quality adjustment factors. A separate set of objections were made to the release of public use data files without quality adjustment factors. The public use data file is often referred to in the comments as "raw data," as if it had not been edited, verified or modified to protect confidentiality. There is concern that the data would be used by unspecified members of the public to produce invalid and misleading analysis that could be used to damage the reputation or competitive position of hospitals and physicians. There were several suggestions that release of public use data tapes either exceeded the statutory authority of the council or was outside the understandings arrived at between legislators and affected stakeholders during negotiations over the statute during the 1995 session.

The council disagrees with the characterization of the public use data file as "raw data." The public use data file will consist of discharge records which have passed the acceptance criteria and edits established by the council. It will consist of discharge records which have been reviewed by the submitting hospital and certified in writing by the CEO or CFO of the hospital as accurate and complete. This certification will come after the hospital's medical staff has been afforded an opportunity to review and correct records on which they are shown as the admitting or treating physician. The public use data file will have been modified only as necessary to meet statutory provisions for confidentiality and to allow risk and severity adjustment. If deemed necessary, the council will have conducted an audit of the discharge records against the hospital's medical record. By no means can one characterize the public use data file as "raw data." The council believes the procedures contained in the proposed rule satisfy the statutory requirement that "The council shall adopt procedures to verify the accuracy of the data before a report containing the data is released to the public."§108.011(d).

The council disagrees with the comments suggesting that such release is not authorized by the statute. The overall thrust of the statute is to make the data collected by the council available to anyone who wants it subject only to specific confidentiality provisions protecting the identity of patients and physicians. The statute makes it a duty of the council to "assure that data collected is made available and accessible to interested persons." §108.006(a)(6). This can best be accomplished by release of a public use data file so that any interested person who wishes can review and analyze the data. The statute also requires that "The council shall promptly provide data to those requesting it, subject to the restrictions on access to council data prescribed by §108.010 and §108.013." §108.011(a). The council is aware of business, labor, educational, research and professional organizations who will request copies of a public use data file or statistical compilations based on that file. The council sees nothing in §108.010 or §108.013 that would restrict this access.

The provisions of the statute concerning confidentiality and general access to data reinforce the view that the council has the obligation to create public use data files from the hospital discharge data and make these files available to the public. The council is required to use data received by the council for the benefit of the public and to make determinations on requests for information in favor of access. The information received by the council, once modified to protect patient and physician confidentiality as required by the statute, is subject to the open records act. §108.013(a).

There have been suggestions that the council create different levels of access to the public use data file for different types of users. For example anyone might have access to a subset of the data elements on the public use data file, but only qualified researchers would be given access to the full public use data file; perhaps after review of their research plans. This is the practice in some states (e.g. California). Other states make their public use data file available to anyone who wants it and pays the established fee (e.g. Florida). Both approaches have been in operation for several years allowing us to observe the results. The council declines this suggestion because we do not believe that the statute allows us to create different classes of users. The statute requires that "The council shall promptly provide data to those requesting it, subject to the restrictions on access to council data prescribed by §108.010 and §108.013." §108.011(a). Thus any data that is available to any member of the public is available to all members of the public. The council is not allowed to restrict access based on the qualifications of the person or entity requesting the data, or on the purposes for which that person or entity requests the data. Further, we decline the suggestion because we are unable to find examples of harm to any individual caused by giving the public full access to the public use data file.

No commenter has cited any example of any instance where the release of public use data files in other states where such data has been available for many years has resulted in any harm to any provider or any confusion or misdirection of any consumer. Examples cited of controversial uses of data were the HCFA hospital mortality reports, reports of CABG outcomes published by the states of New York and Pennsylvania and a recent report published by the Florida Agency for Health Care Administration. All of these are reports prepared by government agencies, with severity adjustment, review by all providers and all other safeguards. None of these reports were the result of release of public use data files to the public. In fact, most private use of public use data files in other states is internal use of the data by hospitals, employers, insurance carriers and benefit consultants which never results in a published report available to the public. Medical or other scientific research based on public use data files are normally subjected to extensive professional peer review before any publication in a professional journal.

Section 1301.18(c) Release of Public Use Data File Containing Less Than One Year of Data. One commenter objected to the initial release of public use data for only six months because this data file would miss seasonal fluctuations, might have limited numbers of records from small providers and might misrepresent the frequency of rare conditions and procedures. The council disagrees that these are reasons to totally withhold data from the public. We agree that these are valid cautions which should be included in all documentation accompanying the data until a full year is available. However, there are other uses of the data for which we believe six months is adequate (e.g. patient origin and destination patterns, hospital market shares for major diagnostic classifications). Since the statute requires us to resolve policy decisions in favor of public access we do not intend to with hold data that is valid for some common uses because the volume of data may not be sufficient for other uses.

Section 1301.18(c) Format for Public Use Data File. One commenter correctly noted that the public use data file will not be the same as the format in which the data was submitted and requested that the rule specify the format for the public use data file. We disagree with this comment. We do not believe the Administrative Procedures Act requires this sort of information to be adopted in a rule. We note that the Texas Department of Health (TDH) has not adopted rules specifying the format of each and every publication and data file it makes available to the public. The format of the public use data file is a matter to be dealt with in the council's internal procedures. Once established, the council will make the format information available to the public.

Section 1301.18(d) Release of Public Use Data Files Without Quality Adjustment Factors. Numerous commenters expressed concern that hospital discharge data would be released through public use tapes and through requests to the council for statistical tabulations without severity adjustment measures. Some commenters believe it is beyond statutory authority or legislative intent to release data without severity adjustment. There is concern that the data without severity adjustment could be misleading to users and would be used by unspecified members of the public to produce invalid and misleading analysis that could be used to damage the reputation or competitive position of hospitals and physicians. The commenters request that no hospital discharge data be released without severity adjustment scores.

The council will not release any public use data tapes without risk and severity adjustment scores from the risk and severity adjustment systems adopted by the council.

We expect to meet soon with the technical advisory committee named by the council to assist with this process. We have the work of other states which have recently selected severity adjustment programs (e.g. Utah, Florida) on which to build. We anticipate seeking the assistance of an outside contractor to provide the analysis and other staff work in support of the selection process. While we anticipate having to extend the January 1, 1997 deadline for selection of a system, as allowed by statute, we anticipate the selection process can be completed in 1997.

Any severity adjustment system will be a embodied in a computer program that creates one or more severity adjustment scores based on an analysis of patient-specific and facility specific data elements collected from hospitals under this proposed rule. Once the severity adjustment program is selected it will therefore be possible to apply it to all hospital discharge records that have already been collected by the council. Thus any public use data released in August 1998 will include severity adjustment scores that have been thoroughly reviewed and commented upon by all interested parties.

Section 1301.18(f) Provision of copies of Provider-specific Data Requests. One hospital requested that in addition to monthly notice of requests that the executive director's summary should provide list the data requested. This seems unnecessary. All requests for statistical compilations will be in writing and will be maintained by the council for two years. Any person may request a copy of any data request filed.

Section 1301.18(g) Written Comments from Providers. Several commenters noted that the rule did not explicitly provide for release of provider comments on the data along with release of a public use data file or a statistical compilation prepared from that file. We agree that such procedures are necessary. We will revise the proposed rule by adding subsection (g) to require the executive director to provide all comments submitted by providers relating to any data released.

Section 1301.19(a) Data Format. Comments were received from many hospitals that the format for data submission was non-standard and would require substantial reprogramming of computer systems on the part of Texas hospitals requiring extensive lead time and subjecting them to great expense. The commenters generally requested that hospitals be able to submit data in whatever form they chose, leaving it to the council to translate the data to a standard format. Other comments were received from TDH suggesting that the format in the proposed rule did not correspond to current ANSI-X.12, Medicare or Medicaid formats.

In response to these comments, the council conferred with the Texas Health Information Network (THIN), the electronic bill clearinghouse which is a subsidiary of Blue Cross Blue Shield of Texas (BCBST). THIN receives electronically approximately 60 million health claims per year, including Medicare claims, the majority being from Texas hospitals and physicians. Based upon information obtained from THIN, the council intends to require data to be submitted by Texas hospitals in a standard format which is the same as that in the proposed rule, with minor changes. The reasons for this decision are as follows:

The data format in the proposed rule is the National Standard Format defined by the Health Care Finance Administration for the electronic submission of inpatient hospital bills covering the UB-92 data set (HCFA 1450 flat file, version 4.0).

We will revise the proposed rule to adopt the HCFA format by reference. We will revise the proposed rule to allow hospitals to submit data in the current or immediately preceding HCFA format.

The data format maps the UB-92 data elements and provides unused fields for additional data elements. The council recognizes that some hospital personnel who work with the UB-92 are unfamiliar with the HCFA 1450 data format. The council will make available to anyone requesting it a crosswalk between the elements and the HCFA 1450 format.

No reprogramming of existing hospital data systems is necessary for most hospitals to submit UB-92 data in this data format. The council requests that any hospital that does not have the capability, internally or through a current vendor, to electronically submit inpatient bills in the HCFA 1450 format to identify itself through a comment and explain what cost it would incur to add this capability.

Because the National Standard Format is promulgated by the federal government, the council is able to adopt this format by reference and make provision for automatic incorporation of revisions by the federal government. WE can also increase reporting flexibility by agreeing to accept the current version or the immediately previous version of the National Standard Format.

The council does intend to modify the data format in the proposed rule in the following ways. First, the proposed rule required the patient's social security number to be reported at Record 30, Field 07. This field is defined "Certificate/Social Security Number/Health Insurance Claim/ Identification Number." For some patients the social security number of the insured party would normally appear here. For other patients, the hospital would have to over write another data item in preparing data for the council. To eliminate this inconvenience, the patient's social security number will be reported at Record 70, Field 28. This field is currently not assigned to any data element. Second, it is possible that a commercial clearing house will be contracted by TDH with the concurrence of the council to perform data collection and editing services. To distinguish records submitted to a clearinghouse for payment from records submitted for reporting to the council, an appropriate code will be reported at Record 01, Field 20.8, Position 183.

Section 1301.19(c) Definition of Data Elements. Comments were received from the Texas Department of Health and from various hospitals that the proposed rule did not adequately define data elements contained in §1301.19. Generally we disagree with these comments because in the proposed rule the data element definitions follow each field. The commenters did not cite specific data elements which they felt were ambiguous or undefined. With a few exceptions discussed as follows, the definitions of data elements that are part of the UB-92 data set are taken verbatim from the National Uniform Billing Data Element Specifications by the National Uniform Billing Committee as published in the latest version of the Texas UB-92 Manual available at the time the proposed rule was published.

Since the publication of the proposed rule, the Congress has passed and the President has signed into law the Health Insurance Portability and Accountability Act of 1996 (P.L. 104-191). Section 1171(c)(3) extended a formal consultative role to the National Uniform Billing Committee and imposed requirements on the Secretary of the Department of Health and Human Services relative to the use of standards published by National Uniform Billing Committee (NUBC) in carrying out her duties under the act. We note that HCFA is a member of the NUBC and substantially influences its decisions. The Texas State Uniform Billing Committee is an extension of NUBC and does not unilaterally modify its standards. Further, in creating the council the Legislature specifically instructed it to use standards established by the NUBC to the maximum extent possible. Therefore the council believes it can adopt by reference the Texas UB-92 Manual and its future revisions as a source of definitions of data elements not otherwise defined in the council's rules. These revisions have been incorporated in the proposed rule.

The data elements included in the proposed rule that are not part of the UB-92 data set and thus are not covered in the National Uniform Billing Data Element Specifications are THCIC facility identifier, THCIC Uniform Payor Identification Number, source of payment code, patient's social security number, race and ethnicity. (Note that insured's social security number is utilized in the UB-92 data set as the default value for commercially insured patients where a policy ID number is unavailable. See Form Locator 60.)

The council has determined that it is not necessary to require hospitals to supply the THCIC Facility or Payor Identifiers for each discharge. With other data elements that hospitals normally submit to payors the council can assign these identifiers to each discharge record and reduce the burden on the hospitals. Therefore hospitals would enter in the fields where the proposed rule called for these identifiers the data normally submitted to the payor on that patient.

For race (Record 20, Field 2) and ethnicity (Record 20, Field 26) the current definitions specified by the United States Census Bureau were printed in the proposed rule.

The proposed rule utilized a set of codes for "source of payment code" (Record 30, Field 04) which was a modification of a code set utilized by Blue Cross Blue Shield of Texas. The BCBST code set did not include a category for self-pay and did not distinguish all categories of HMO patients. In developing the code set in the proposed rule the council looked to the code set currently in use by the State of Florida in its hospital discharge system and blended the two code sets. We note that the BCBST can be extended to capture all the necessary categories and we have revised the code set in the proposed rule. We have identified the necessary categories and we have revised the code set as shown in §1301.19(c)(4). We have deferred assignment of single letter codes to these categories until adoption of the final rule.

The Texas Medical Association indicated there was a problem in requiring the reporting of bills on workers' compensation patients in a standard format because the Texas Workers' Compensation Commission requires the use of non-standard CPT codes for services. The council is aware of the variation on the standard CPT-4 code set adopted by the Texas Workers' Compensation Commission in its latest Medical Fee Guideline. We do not believe this will be a problem with regard to the hospital discharge data system because procedures on inpatient hospital bills for workers' compensation patients utilize ICD-9 procedure codes. The variance from standard CPT-4 codes only affects bills for outpatient services which are beyond the scope of the proposed rule.

Section 1301.19(c) Required data elements. The proposed rule stated that all data elements were required unless otherwise indicated. Other than comments on collection of social security number, race and ethnicity, we received no comments during the formal comment period concerning which data elements should be required and which should not. However, there have been numerous comments that the data requested in the proposed rule was excessive and burdensome.

We have revised the proposed rule to identify a minimum set of data elements that are required for all patients, regardless of insurance or payment status. In deciding which data elements to require we have considered the lists of required data elements utilized by the current THA patient discharge system and by other state hospital discharge systems. We have considered the data elements required in order to calculate severity adjustment scores. We have considered the minimum data elements required for use of the data by employers, health care providers and public health researchers.

Beyond the required minimum data set for each patient, the rule requires the hospital to submit on each patient all information submitted to the payor(s) for that patient. This data should not be thought of as optional. However, because it will differ from patient to patient, the lack of any data element beyond the minimum required data set will not prevent the discharge record from being included in the council's data base or in the public use data file.

Section 1301.19(e)(3) Patient Data - Collection of Patient Name. One commenter indicated its policy was to redact patient names and replace them with patient account numbers or medical record numbers before releasing data. The collection of patient names is necessary in order to assign a uniform patient identifier that will enable patients to be tracked across multiple admissions to multiple facilities. A patient account or medical record number is unique to the hospital that assigns it and cannot assist in linking a discharge record to another for the same patient. The council believes it has statutory authority to require hospitals to submit this data, just as the Texas Workers' Compensation Commission has for many years, after taking fully into account state and federal confidentiality requirements. We also believe the statute and proposed rules establish sufficient safeguards to patient confidentiality which will be observed by the council in the implementation of its information systems.

Section 1301.19(e)(3) Patient Data - Collection of Social Security Number. Many hospitals objected to the requirement that hospitals collect the patient's social security number. They further objected to identifying the reason no social security number was available for patients without one. Some said this would require additional work by hospital staff. Others said requesting it might be offensive to the patient for various reasons, including it as an attempt to screen out aliens. Hospitals also said the social security number should not be collected because it was not part of the UB-92 data set. The council does not accept these comments.

We believe that almost all hospitals routinely collect the social security number from all patients that have one and enter it into their data systems. No hospital claimed it did not. The objection therefore appears to be more one of releasing the data to collecting it.

We do not believe the statute restricts the council to collection of data elements that are part of the UB-92 data set where the additional data sets are within the general statutory authority of the council to collect. We read the intent of the statute as encouraging us to use UB-92 definitions for data elements found in that data sets rather than creating new definitions which could be confusing.

The council believes the use of the social security number as a patient identifier has become so routine in health care that few, if any, patients could sincerely claim to be offended by the request for this data. We have revised the instructions on what to do if the patient has no social security number because they are not a U.S. resident by taking advantage of the Special Condition code added to the newest edition of the Texas UB-92 Manual, "Patient is non-U.S. Resident" (Form Locator 24-30(25)).

The council understands that social security numbers are not universally available or reliable. However, the council believes that in order to analyze patterns of inpatient hospital use, including transfers, readmissions and movement between acute and non-acute hospital units that it must do its best to construct a uniform patient identifier as defined in the statute §108.002(15)). The council believes that while the social security number is not sufficient standing alone as the uniform patient identifier, that it is extremely valuable as one of several patient data elements that can be used together to create usable identifiers. Thus, the council believes that the benefits of requiring reporting of the patient's social security number, or the reason it is unavailable, outweigh the costs.

The social security number is part of the minimum data set. The rule requires that the hospital supply either a social security number or a code indicating the reason a number is unavailable. A discharge record would be rejected only if the field was blank or contained invalid characters.

Section 1301.19(e)(3) Patient Data - Collection of Race and Ethnicity Data. Many hospitals objected to the requirement that they be required to collect and report race and ethnicity data on patients. Some objected to the lack of clear definitions of the terms. Some objected to the lack of clear instructions on whether the patient was to be asked to classify himself or herself or whether the hospital staff person was to be required to make a judgment. Some objected that the council did not have statutory authority to collect data elements that were not part of the UB-92 data set. Some felt patients might find the question offensive. Some objected that collecting this information would require reprogramming of data systems, revision of forms and retraining of staff; all at significant expense to the hospitals. One hospital objected that the request for or availability of this data might lead to claims of discrimination.

The code sets for race and ethnicity used in the proposed rule are the standard code sets of the U.S. Census Bureau. It is the intention of the council to revise its code sets for these data elements in the future to be uniform with the Census Bureau. The proposed rule has been revised to clarify that initially the patient, or the person speaking for the patient, is to be asked to make the classification in response to questions from hospital staff. If the patient declines to answer, the hospital staff person is instructed to make the classifications using their best judgment based on available information. If the hospital uses its best judgment, the council has no intention of disputing that judgment. The revised language also provides a statement whereby the hospital may inform the patient that the questions are required by the State of Texas.

The council disagrees with the comment that it lacks statutory authority to require reporting of race and ethnicity as part of the hospital discharge data system. In §108.009(h) we are required to coordinate data collection with the data collection formats used by hospitals and other providers. The NUBC is cited as an example of the publisher of one such format. We note that we have complied with this requirement for data elements defined by the NUBC. However, §108.009(a) gives the council the authority to require reporting of those data it deems appropriate. We are not limited to the UB-92 data set. We would only be outside our statutory authority if the statute forbade us from requiring hospitals to report a data element or if the data element had no reasonable relationship to legislated mission of the council. We do not believe either condition puts us outside our statutory authority with regard to race and ethnicity.

We believe the benefits to the State of collecting data on race and ethnicity outweigh the costs to the hospitals of collecting them. There is a well developed literature that has shown statistically significant differences in the health care provided to racial and ethnic groups for similar medical conditions, even after controlling for insurance status. Some of the differences in health care appear to affect outcomes, while others do not. We believe availability of this data will potentially assist the State in making cost-effective, good quality health care accessible to all Texans.

We disagree that patients will find these questions offensive. The questions have become extremely common. Similar questions appear on census questionnaires, employment applications, certain banking applications, school enrollment applications and vital statistics records. We believe most persons who are members of racial and ethnic minority groups understand the purpose of the questions is to enable government to monitor the actions of various organizations in the community to detect and prevent discrimination.

Unlike social security number, the council acknowledges that race and ethnicity are not part of the UB-92 data set and are not routinely collected by hospitals at present. Time and expense will be required to reprogram computers and train hospital staff to collect this data. In order to prevent the collection of these two data elements from delaying commencement of the overall hospital discharge data system, we have revised the proposed rule to require collection of these data elements on patient discharged on or after January 1, 1998. This delay will also give the 1997 Legislature the opportunity to provide the council guidance on this matter as it sees fit.

Comments not Related to Specific Sections of the Proposed Rule

Duplication of Texas Hospital Association Patient Discharge System. One hospital commented that the proposed rule would duplicate the efforts of THA and also duplicate efforts of the Houston and Dallas Business Groups on Health to build discharge data bases. The commenter suggests coordination to create one quality and outcomes reporting initiative.

We believe a purpose of the statute is to create a hospital discharge data base as part of a broader health care information system that, subject to patient and physician confidentiality provisions, is available to all members of the public. None of the hospital discharge data bases mentioned by the commenter are available to the public as public use data files. All are owned and controlled by private organizations who have not made them generally available to the public and have not proposed to do so.

We see the creation of a statewide hospital discharge data base as eventually eliminating the need for many organizations to create separate proprietary data bases at considerable expense and with considerable duplication of effort. Some of the strongest support for creation of the council came from business and consumer interests who felt it would be more efficient and beneficial to create a central state data base. Outside the largest metropolitan areas, employers do not appear to be able to build their own data systems and thus lack information to guide their health care purchasing decisions. As the council's data base becomes available the organizations currently building data bases will have the opportunity to decide if they need to continue their separate collection efforts, or if they can rely on the state to collect the data and devote their resources to analysis of the data.

Severity Adjustments Should Consider Teaching Hospital Status. Several commenters noted that the statute §108.010(f) requires any severity adjustment mechanism to consider a hospital's teaching status, and that this was not addressed in the proposed rule. The proposed rule does not specify the severity adjustment mechanism, and is not requires to do so. Since teaching hospital status is hospital-specific and not patient specific, we do not need to include this as a data element on each discharge. The council has access to lists of teaching hospitals which can be utilized when making severity adjustments.

Obligation to provide Consumer Education. Several commenters noted that the council has the duty to provide consumer education and that this was a reason not to release a public use data file. The council does have a broad mission to provide health education information to consumers. This obligation is not specific to hospital discharge data, but also includes HEDIS data and other data elements that may become part of a state health care information system. The council has established a standing committee to develop its consumer education program. We disagree that there is any inconsistency between the council's duty to provide consumer education and the proposed release of public use data files to hospitals, employers, researchers and the general public.

Legal Liabilities Created for Hospitals by Submitting Patient Data. One commenter was concerned that an improper release of data by the council which violated patient confidentiality could create legal liability for the hospital that originally submitted the data. The same concern is expressed with regard to any improper release of data from medical records which was obtained during a data verification effort. We do not believe there is cause for concern on this issue. We do not see a legal basis for anyone to claim a hospital has liability for release of data which was made available to the state in compliance with state and federal statutes and rules. Any liability would lie against the person or entity responsible for the improper release as provided in §108.013. The hospitals should be concerned about liability attaching to them if patient confidentiality was breached as a result of voluntarily submitting data to a private data collection program.

Cost to Hospitals of Compliance. Many commenters took exception to the cost estimates contained in the preamble to the proposed rule. One commenter provided a detailed cost estimate of costs to hospitals which totaled about $17 million per year. We have considered this estimate and do not believe it is reasonable. It ignores the use in the proposed rule of the national standard format and the National Uniform Billing Committee definitions of UB-92 data elements. It ignores the fact that 40% of hospital discharges are Medicare patients whose bills are almost all currently submitted electronically in the national standard format. We have recognized the potential difficulty in collecting data on race and ethnicity and make no current requirement for reporting these elements pending legislative guidance. We have also relieved the hospital of responsibility for assigning a uniform payor identifier or a uniform facility identifier. The commenter was in error in stating that a source of payment code is a new data element. It is currently part of the national standard format. The commenter also asserts that any modification in any data system must be made separately at each Texas hospital. This is incorrect. We expect hospitals will make use of their current arrangements with their corporate parents (e.g. Columbia) and their existing clearinghouse vendors to remap data elements as necessary. The actual number of entities submitting data to the council will be far fewer than the number of hospitals reporting. This substantially reduces the cost of any data system modifications to utilize the national standard format. We would be interested to learn of any hospital billing systems which are currently on the market or in use which are unable to produce an electronic discharge record in the national standard format utilized by Medicare.

Conflict with the Administrative Simplification Provisions of the Kennedy-Kassebaum Legislation. One commenter suggested that Texas suspend implementation of the hospital discharge data system because there might be conflicts with the recently passed Health Insurance Portability and Accountability Act of 1996 (P.L. 104-191). We disagree with this comment. Subtitle F of the federal legislation requires the Secretary of Health and Human Services to adopt standards within 18 months of the effective date of the act. The standards will include a format and data elements for health claims or equivalent encounter information which would cover the discharge record defined in the proposed rule. The Secretary must also adopt standards providing a unique health identifier for each individual, employer, health plan and health care provider. (Subtitle F, §1173.)

The council has taken into account the requirements and likely course of implementation of §1173 in drafting the proposed rule. Since HCFA already requires use of the national standard format for billing Medicare, it will be in the interest of the federal government to initially adopt this as the data format for health claims. We believe there is no real alternative to the adoption of the National Uniform Billing Committee definitions of the data elements on the UB-92, and HCFA has had substantial influence on the development of this standard. As an identifier for individual patients, we believe it is reasonable to assume the Secretary will use the social security number, when available, and define an alternative for those without a social security number. We are not requiring hospitals to adopt uniform facility or health plan identifiers. Therefore we do not believe there is adequate reason to postpone carrying out the instructions of the Texas Legislature to develop a hospital discharge data system. We also note that once the standards are adopted by the Secretary, there will be two years allowed for implementation. This will allow ample time for any required revisions to the council's data system.

Adequate Time for Public Comment. Several commenters stated that because of when they had received a copy of the proposed rule and because of the multiple parties within hospitals who needed to review the rule and provide comments that there had not been adequate opportunity for public comment. The council notes that it had several meetings with representatives of THA, (Texas Medical Association) TMA and other interest groups leading up to the publication of the proposed rule. The council took the initiative to call a public hearing and worked with the THA and others to promote distribution of the proposed rules to people who may not regularly read the Texas Register. Though the time was short between the appearance of the proposed rule in the Texas Register and the public hearing, we believe that by now, all hospitals and most other stakeholders are fully aware of this rulemaking process. Because we are making substantial revisions to the proposed rule, we will republish it and thus open a new comment period. We believe this should alleviate any concerns with the opportunities for public input.

Based upon information provided by the Texas Department of Health, Ronald Luke, chair of the hospital discharge data committee, Texas Health Care Information Council, has determined that for the first five-year period the sections are in effect there will be fiscal implications. The costs to state government may average up to $450,000 per year. A portion of these costs may be recaptured through revenues generated by user fees for products produced through implementation of these rules. The revenues to be generated through user fees are expected to be positive but as yet undetermined. Costs may be less if TDH is able to contract for data collection services at a lower cost than it could perform the services internally. There will be no fiscal implications for local governments except to the extent that local governments operate hospitals that are required to submit data per these rules.

Dr. Luke has also determined that for each year of the first five years the sections are in effect, the public benefits anticipated as a result of enforcing and administering the sections will be public access to hospital discharge data regarding health care charges, utilization data, provider quality data, and outcome data to facilitate the promotion and accessibility of cost-effective, good quality health care; to provide an information and data source for providers, consumers, purchasers, and policy makers alike; to promote informed decision making in providing, utilizing, and purchasing health care and for developing and implementing health care policy throughout the state; and to provide a means of benchmarking throughout the state to promote continuous quality improvement by providers to ensure good quality, accessible health care to the citizens of Texas.

There will be additional, marginal costs to providers. Few, if any, of the hospitals required to submit data under this rule can be classified as small businesses. Almost all Texas hospitals currently have the ability to submit the required data electronically in the required format. Under the proposed rule, all hospitals shall file discharge reports by electronic filing (tape, diskette or modem) unless the hospital receives an exemption letter from the Council. Any costs of submitting data to THCIC may be offset in part by the reduced need for hospitals to pay to participate in private discharge data collection efforts.

The Texas Department of Health, Texas Hospital Association, Blue Cross/Blue Shield, health data organizations in 17 states, and 46 hospitals within the State of Texas were contacted for information regarding provider costs in providing data and information required on uniform billing (UB) form 92 (the format required by these rules). These entities reported a range of costs, from 2 to 3 cents per discharge up to 75 cents per form submitted. For providers that have discharge data bases which are similar to that required for completion of the UB form 92 and which are fully computerized, the cost averages 2 to 3 cents per patient discharged from the hospital; for those that have systems which are not fully computerized or which do not maintain data bases similar to that required for completion of the UB form 92, the cost averages 50-55 cents per hospital discharge; and for those that have little or no computer support and process all claims manually, the cost increases to about 75 cents per hospital discharge. To the extent that hospitals are not currently collecting all of the data required by these rules, they may incur additional costs. Similarly, to the extent that hospitals utilize outside vendors, they may incur additional costs. As a consequence, the financial impact will be most significant on small hospitals with little or no automated data processing capability. For all of the hospitals required to submit data under these rules within the State of Texas, the total cost is expected to be approximately $326,000 per year. There is no anticipated effect on local employment.

The new sections are proposed under the Health and Safety Code, §108.6-108.13, which provide the Texas Health Care Information Council with the authority to establish rules to implement and administer a state-wide health data collection system.

These new sections affect Health and Safety Code, Chapter 108.

§1301.11.Definitions.

The following words and terms, when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise.

Batch file

- A set of computer records as specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes) which contains one or more discharge files and other required header and trailer records. A batch contains discharge files for only one hospital.

Charge

- The amount billed by a provider for specific procedures or services provided to a patient before any adjustment for contractual allowances, government mandated fee schedules or write-offs for charity care, bad debt or administrative courtesy. The term does not include co-payment charges to a health maintenance organization enrollees by providers paid by capitation or salary in a health maintenance organization.

Council

- The Texas Health Care Information Council.

Discharge

- The formal release of a patient by a hospital; that is, the termination of a period of hospitalization by death or by disposition to a residence or another health care provider.

Discharge file

- A set of computer records as specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes) relating to a specific patient. Except for some normal newborn infants there will be one or more discharge files for each inpatient.

Discharge report

- A computer file as defined in § 1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes) periodically submitted on or on behalf of a Hospital in compliance with the provisions of this chapter.

Electronic filing

-The submission of computer records in machine readable form by modem transfer from one computer to another or by recording the records on a nine track magnetic tape, computer diskette or other magnetic media acceptable to the executive director.

Error

- Data submitted on a discharge report which are not consistent with the format and data standards contained in this rule or with editing criteria established by the executive director, or the failure to submit required data.

Executive director

- The chief administrative officer of the council, or, in the event the council is without an executive director, the person designated by the chairperson of the council to perform the functions and exercise the authority of the executive director.

Facility identifier

- A unique number assigned by the council to each health care facility in the state. For hospitals this will be the hospital's state license number. Where a hospital operates multiple facilities under one license number, the council will assign a suffix for each separate facility.

Health care facility

- A hospital, an ambulatory surgery center licensed under Chapter 243 of the Health and Safety Code, a chemical dependency treatment facility licensed under Chapter 464 of the Health and Safety Code, a renal dialysis center, a birthing center, a rural health clinic or a federally qualified health center as defined by 42 United States Code, §1396(1)(2)(B).

Hospital

- A public, for-profit, or nonprofit institution licensed or owned by this state that is a general or special hospital, private mental hospital, chronic disease hospital or other type of hospital.

Geographic identifier

- A set of codes and accompanying maps prepared by the Council covering Texas and adjacent states with each code consisting of two or more zip codes, a set of codes and accompanying maps prepared by the council covering the rest of the United States consisting of three digit zip codes, a set of codes and accompanying maps prepared by the council covering Canada and Mexico consisting of a separate code for each state or province and a set of codes for each of the other countries.

Inpatient

- A patient, including a newborn infant, who is formally admitted to the inpatient service of a hospital and who is subsequently discharged, regardless of status or disposition. Inpatients include patients admitted to medical/surgical, intensive care, nursery, subacute, skilled nursing, long-term, psychiatric, substance abuse, physical rehabilitation and all other types of hospital units.

Other health professional

- A person licensed to provide health care services other than a physician. An individual other than a physician who admits patients to hospitals or who provides diagnostic or therapeutic procedures to inpatients. The term will encompass persons licensed under various Texas practice statutes, such as psychologists, chiropractors, dentists and podiatrists who are authorized to admit or treat patients.

Patient control number

- A number assigned to each patient by the hospital which appears on each computer record in a patient discharge file. This number is not consistent for a given patient from one hospital to the next, or from one admission to the next in the same hospital. The council deletes or encrypts this number to protect patient confidentiality prior to release of data.

Physician

- An individual licensed under the laws of this state to practice medicine under the Medical Practice Act (Vernon's Texas Civil Statutes, Article 4495b).

Provider

- A physician, health care facility or health maintenance organization.

Public use data file

- A data file composed of discharge files with risk and severity adjustment scores which have been altered by the deletion, encryption or other modification of data fields to protect patient and physician confidentiality and to satisfy other restrictions on the release of hospital discharge data imposed by statute.

Required minimum data set

- The data elements which hospitals are required to submit in a discharge file for each inpatient regardless of whether or not the hospital would have prepared a bill for the inpatient. The required minimum data set is specified in §1301.19(e) of this title (relating to Discharge Reports - Records, Data Fields and Codes).

Rural provider

- A provider located in a county with a population of not more than 35,000 according to the most recent United States Bureau of the Census estimate, those portions of extended cities that the United States Bureau of the Census has determined to be rural, or an area that is not delineated as an urbanized area by the United States Bureau of the Census.

Submission

- A set of computer records as specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes) that constitutes the discharge report for one or more hospitals.

Submitter

- The person or organization which physically prepares discharge reports for one or more hospitals and submits them to the council. A submitter may be a hospital or an agent designated by a hospital or its owner.

Uniform patient identifier

- A random number assigned to an individual patient which remains constant across hospitals and inpatient admissions.

Uniform payor identifier

- A unique number assigned by the council to every third party payor of UB-92 bills. Where ever possible the council will use established numbering systems such as that maintained by the National Association of Insurance Commissioners.

Uniform physician identifier

-A unique number assigned by the council to any physician or other health professional who is reported as admitting or treating a hospital inpatient which remains constant across hospitals.

§1301.12.Collection of Hospital Discharge Data.

(a)

All hospitals in operation for all or any of the reporting periods described in §1301.13 of this title (relating to Schedule for Filing Discharge Reports) shall submit discharge files on all inpatients to the Council. Hospitals owned by the federal government and hospitals exempted as rural providers may submit hospital discharge files.

(b)

All inpatient discharges shall be reported. Except as noted as follows, one or more discharge files shall be submitted for each patient for each discharge covering all services and charges from admission through discharge.

(1)

Separate discharge files shall normally be submitted for mothers and newborns. Hospitals are not required to create a separate discharge file for a normal newborn infant if the delivery is covered by a third party payor and the third party payor does not require separate bills for the mother and the infant. For any birth where there is no third party coverage, separate discharge files are required for the mother and the infant.

(2)

Where a hospital has issued interim and final bills covering a single patient discharge, the hospital shall submit separate discharge files corresponding to each bill.

(3)

Where a patient has been served in multiple units of a hospital (e.g. acute care, skilled nursing care, comprehensive medical rehabilitation, substance abuse) during a single continuous stay, some third party payors require that separate bills be prepared for services in acute and sub-acute units while others do not. Where a patient has third party coverage, the discharge files submitted by the hospital shall correspond to the bills submitted to the payor. Where a patient has no third party coverage, the hospital shall submit a separate discharge file for each unit.

(4)

For all patients for which the hospital prepares one or more bills for inpatient services, the hospital shall submit a discharge file corresponding to each bill containing the required minimum data set and all other data elements included on the bill whether included because of the requirements of third party payors or because of hospital policy. For all patients for which the hospital does not prepare a bill for inpatient services, the hospital shall submit a discharge file containing the required minimum data set.

(c)

All hospitals shall file discharge reports by electronic filing unless the hospital receives an exemption letter from the Council.

(d)

All hospitals shall submit discharge files and discharge reports in the format specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes).

(e)

Hospitals shall submit discharge reports, data certifications, exemption requests and other required information to the council or its agents at physical or telephonic addresses specified by the executive director. The executive director shall notify all hospitals and submitters in writing and by publication in the Texas Register at least 30 days before any change in the addresses.

(f)

Hospitals may submit discharge reports, or may designate an agent to submit the reports. If a hospital designates an agent, it shall inform the council of the designation in writing at least 30 days prior to the agent's submission of any discharge report. The hospital shall inform the council in writing at least 30 days prior to changing agents or making the submissions itself. Designation of an agent does not relieve the hospital of responsibility for compliance with this chapter or other related law.

(g)

If requested by the council, a hospital shall provide the executive director and his agents access to, copies of and/or information from the hospital documents and records underlying and documenting the discharge reports submitted, as well as other patient related documentation deemed necessary to conduct audit hospital data to verify its accuracy and reliability. Each request from the council shall detail the reasons for such request, provide the hospital with at least 14 days advance notice, and ensure that confidentiality of patient records is maintained.

§1301.13.Schedule for Filing Discharge Reports.

(a)

For discharges occurring on or after July 1, 1997, hospitals shall file discharge reports according to the following schedule unless a hospital has received an exemption letter from the council.

(1)

Each discharge report covering inpatient discharges occurring between January 1 and March 31, inclusive, shall be submitted no later than June 1 of the calendar year in which the discharge occurred.

(2)

Each discharge report covering inpatient discharges occurring between April 1 and June 30, inclusive, shall be submitted no later than September 1, of the calendar year in which the discharge occurred.

(3)

Each discharge report covering inpatient discharges occurring between July 1 and September 30, inclusive, shall be submitted no later than December 1 of the calendar year in which the discharge occurred.

(4)

Each discharge report covering inpatient discharges occurring between October 1 and December 31, inclusive, shall be submitted no later than March 1 of the year following the year in which the discharge occurred.

(b)

On or before May 30, 1997, hospitals shall submit a discharge report drawn from inpatient discharges occurring between January 1, 1997 and March 31, 1997, inclusive. This discharge report shall be used for test and certification purposes only. The discharge report may include all discharges for the quarter, but the hospital is only required to submit discharge files covering discharges for any consecutive 30 days of the quarter.

(c)

Extensions to processing due dates may be granted by the executive director for a maximum of ten working days in response to a written request signed by the hospital's chief executive officer. Requests must be in writing, must be received at least five working days prior to the due date and must be accompanied by adequate justification for the delay.

(d)

Failure to file a discharge report on or before the due date without an extension, is punishable by a civil penalty pursuant to Health and Safety Code, §108.14.

(e)

The other provisions of this section not withstanding, no hospital shall be required to file a discharge report sooner than 90 calendar days after the effective date of this rule.

§1301.14.Instructions for Filing Discharge Reports.

(a)

Magnetic Media - A discharge report may be filed on computer diskettes, nine track tapes or other magnetic media approved by the executive director. All discharges shall be reported using the same file and record formats specified in §1301.19 regardless of medium.

(1)

Media specifications are:

(A)

Diskette: MS-DOS formatted; PC Text file (ASCII); Record length = 192 characters, fixed; 3.5 inch diskette, 1.4 megabyte, high density.

(B)

Nine track tape: Density = 1600 or 6250 BPI, nine track; Collating sequence = EBCDIC or ASCII; Record length = 192 characters, fixed; Blocking = unblocked; Labeling = no label.

(C)

Other magnetic media: Discharge reports may be filed on other magnetic media only with the prior written approval of the executive director. The executive director will not normally approve any medium which the Council is not currently equipped to read.

(2)

Hospitals shall submit no more than one tape or two diskettes per submission, with the following external identification affixed:

(A)

Hospital name.

(B)

Facility identifier.

(C)

Reporting period for discharges.

(D)

Number of records by record type.

(E)

Tape density: 1600/6250 BPI (if applicable).

(F)

Collating sequence for tapes (if applicable).

(G)

The description: "DISCHARGE DATA".

(3)

Data for more than one hospital may be submitted on a single tape if the submitter provides external identification items in paragraph (2)(A)-(D) of this section for each hospital.

(4)

In addition to the provisions of this section, the council shall document instructions for filing discharge reports on magnetic media and shall make this documentation available to hospitals at no charge and to the public for the cost of reproduction. The council shall notify hospitals or their designated agents at least 90 days in advance of any change in instructions for filing discharge reports on magnetic media. The council's instructions shall follow Department of Information Resources standards for magnetic media established under Chapter 201 of this Title.

(b)

Electronic Data Interchange: Discharge reports may be filed by modem using electronic data interchange (EDI). All discharges shall be reported using the same file and record formats specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes) regardless of the medium of transmission. Record length is 192 characters for all records. The council shall document instructions for filing discharge reports by EDI and shall make this documentation available to hospitals at no charge and to the public for the cost of reproduction. The council shall notify hospitals and their designated agents at least 90 days in advance of any change in instructions for filing discharge reports by EDI. The council's instructions shall follow Department of Information Resources standards for EDI.

(c)

Paper Forms: Only hospitals granted an exemption from electronic filing of discharge reports may file discharge reports using paper UB-92 billing forms. Hospitals using paper forms are required to provide all data elements specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes).

(1)

All UB-92 forms filed shall be on the form currently approved by the federal Health Care Finance Administration. Photocopies are not acceptable.

(2)

Hospitals shall submit no more than one batch of paper forms per submission, with the following external identification affixed:

(A)

Hospital name;

(B)

Facility identifier;

(C)

Reporting period for discharges;

(D)

Number of forms; and

(E)

The description: "DISCHARGE DATA".

(3)

In addition to the provisions of this section, the Council shall document instructions for filing paper UB-92 forms and shall make this documentation available to hospitals at no charge and to the public for the cost of reproduction. The council shall notify hospitals or their designated agents at least 90 days in advance of any change in instructions for filing paper forms.

§1301.15.Exemptions from Filing Requirements.

(a)

Types of Exemptions

(1)

Exemption as a Rural Provider - All hospitals except those owned by the federal government shall submit discharge reports to the council unless the council determines that the hospital is a rural provider. The executive director shall make a determination of which hospitals are entitled to this exemption at least annually and shall notify qualifying hospitals by publication in the Texas Register and by regular United States mail. Hospitals which are not initially given an exemption may apply for an exemption. This exemption, if granted, may be revoked by the council should the hospital cease to meet the criteria for exemption based upon the most current data issued by the United States Bureau of the Census. Hospitals that cease to be exempted as rural providers shall be responsible for submitting discharge files on all discharges that occur 30 days after notice is given. The initial discharge report shall not be due until 90 days after notice is given. Subsequent discharge reports are due as specified in §1301.13(a) of this title (relating to Schedule for Filing Discharge Reports).

(2)

Exemptions from Quarterly Filing of Discharge Reports - Hospitals that wish to submit discharge reports to the council more often than quarterly may do so by requesting an exemption to the standard submission schedule. The council may also issue general exemptions based on the processing arrangements for data collection. Exemption requests meeting the following criteria will normally be approved.

(A)

The exemption request includes the specific schedule on which the hospital will make its discharge reports which will usually be daily, weekly or monthly.

(B)

The exemption request states the medium in which submissions will be made.

(C)

The exemption request will not result in data on any discharge being submitted to the council at a later date than it would have been if the standard schedule been followed.

(D)

The hospital agrees to adhere to the schedule specified in the exemption request until the hospital notifies the executive director in writing that it wishes to end the exemption and report according to the standard schedule, or until a new exemption letter is issued.

(3)

Exemption from Electronic Filing of Discharge Reports - The council will grant exemptions from electronic filing of discharge reports only when a hospital can demonstrate that it lacks electronic data processing capacity and that electronic filing of discharge reports imposes an unreasonable financial burden upon the hospital. If granted, the exemption is valid for one year and must be renewed annually by the hospital. The exemption from electronic filing of discharge reports does not change the data the hospital is required to file on each discharge as specified in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes), nor the schedule for submission specified in §1301.14 of this title (relating to Instructions for Filing Discharge Reports). Exemptions from electronic reporting to the council will not normally be granted unless

(A)

the hospital shows that it does not currently electronically file UB-92 bills with any payor, or has not done so in the last 12 months prior to the request for exemption; and

(B)

the hospital shows that it could not cost-effectively submit UB-92 bills electronically to its payors and to the Council utilizing internal staff or utilizing contractors for this function.

(b)

Requests for exemptions shall be submitted and processed using the following procedures.

(1)

A hospital requesting an exemption shall submit to the executive director a letter requesting the exemption and providing all information necessary to establish the hospital's entitlement to the exemption. The exemption request shall be signed by the chief executive officer of the hospital who shall certify that all information contained in the request is true and correct.

(2)

The executive director shall review the request for exemption. The executive director may request additional information from the hospital relevant to the exemption request. Within 30 days of receipt of a request, the executive director shall issue a letter granting or denying the exemption. If denied, the letter shall state in detail the reasons for the denial. The executive director shall notify council members of exemptions requested and the disposition of these requests for information only.

(3)

If the executive director denies an exemption request the hospital may

(A)

Resubmit the request along with any additional information or analysis the hospital deems relevant to the executive director. The resubmission shall be considered in the same manner as an initial submission; or

(B)

Appeal the executive director's decision to the council. The hospital may make an appeal directly to the council. In making its determination, the council will consider only those facts and issues which have been previously presented to the executive director. The council will decide exemption appeals by majority vote of members present.

(4)

The executive director may revoke any type of exemption if facts indicate that a hospital no longer meets the criteria required for an exemption. The executive director shall give the hospital written notice of the revocation at least 30 days prior to the effective date of the revocation. The notice shall include a detailed statement of the facts on which the revocation is based. A hospital may challenge the revocation of its exemption by:

(A)

Requesting the executive director to reconsider the revocation by submitting any information or analysis the hospital deems relevant to the executive director in writing at least ten days prior to the effective date of the revocation; and

(B)

If the executive director does not agree that the exemption should continue, by appealing the executive director's decision to the council. In making its determination, the council will consider only those facts and issues which have been previously presented to the executive director. The council will decide exemption appeals by majority vote of members present.

§1301.16.Acceptance of Discharge Reports and Correction of Errors.

(a)

To verify the accuracy of all discharge files prior to public release, the executive director shall establish procedures for the review of all discharge reports to determine whether the report is acceptable, as required by Health and Safety Code, §108.11.

(b)

Upon receipt of a discharge report, the executive director shall determine if it satisfies minimum criteria for processing. If it does not, the executive director shall return the report and state the deficiencies in writing within ten days of receipt. The hospital shall resubmit the report within ten days of notification by the executive director. A discharge report does not meet minimum standards for processing under the following circumstances.

(1)

The physical media and labeling do not conform to the specifications in §1301.14 of this title (relating to Instructions for Filing Discharge Reports).

(2)

The physical media are unreadable due to physical damage.

(3)

The file structure does not conform to the specifications in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes).

(c)

Correction of Errors

(1)

The executive director shall review all discharge reports accepted for processing and will process all discharge files against the editing criteria established by the this rule and by the executive director. Within 30 days of receipt of an accepted discharge report the executive director shall notify the hospital in detail of all errors detected in the discharge report.

(2)

Within 30 days of receiving initial notice of errors in a discharge report, the hospital shall correct all discharge files containing errors, add any discharge files determined to be missing from the initial discharge report and resubmit the discharge files. If the hospital disagrees with any identified error, the hospital shall submit written justification of the correctness or completeness of its data. Each hospital shall submit such modified and/or additional discharge files as may be required to allow the chief executive officer or chief financial officer to certify the discharge report as required by §1301.17 of this title (relating to Certification of Discharge Reports). Corrections to a discharge report shall be submitted in the same medium and format as the original discharge report unless the executive director approves another medium.

(3)

Within ten days of receiving corrections to a discharge report from a hospital, the executive director shall notify the hospital of any remaining errors. The hospital shall have ten days from receipt of this notice to correct the errors noted or submit a written explanation of why the data should be deemed correct and complete. This process shall be repeated until the executive director is satisfied that the data submitted by the hospital is substantially accurate and until the hospital is able to certify the discharge report as required by §1301.17 of this title (relating to Certification of Discharge Reports).

(d)

The executive director will document and the council will approve all acceptance and editing criteria utilized in reviewing discharge reports. If acceptance and editing criteria are incorporated into computer software, and if the software is the property of the council, the executive director will make copies of the portions of the software containing the criteria available on paper or magnetic media. The executive director will shall make this information available to submitters without charge and to others for the cost of reproduction.

(e)

Failure to correct a discharge report which has been filed but contains errors or omissions within the due dates in §1031.13 of this title (relating to Schedule for Filing Discharge Reports) is punishable by a civil penalty pursuant to Health and Safety Code, §108.14.

§1301.17.Certification of Discharge Reports.

(a)

The chief executive officer or the chief financial officer of each hospital shall certify that the discharge report for each quarter is accurate using forms supplied by the council.

(b)

The certification shall represent that a complete review of hospital records was accomplished to assure the accuracy of the discharge report and any corrections submitted, that all errors and omissions known to the hospital have been corrected, and that to the best of their knowledge and belief, the data submitted is accurate and complete. The certification shall also represent that the hospital has provided physicians and other health professionals on its medical staff a reasonable opportunity to review the discharge files for which they were the admitting or treating physician or other health professional prior to certification, have corrected any errors brought to the hospital's attention and have included with the discharge report any comments on the accuracy of the data submitted by physicians or other health professionals. Written explanation of any unresolved disagreements with the executive director concerning the accuracy and completeness of the data at the time of the certification shall be attached to the certification form.

(c)

Each hospital must file its certification of each quarter's data with the council within six months following the last day of the reporting quarter. Extensions to this period will not be granted.

(d)

Failure to timely file a certification of discharge data previously submitted is punishable by a civil penalty pursuant to Health and Safety Code, §108.14.

§1301.18.Hospital Discharge Data Release.

(a)

Council records are public records under Government Code, Chapter 552, except as specifically exempted by Health and Safety Code, §108.10 and §108.13, and are available for public inspection during normal business hours. Copies of such records may be obtained upon request and upon payment of user fees established by the council. Discharge files in the original format they are submitted to the council are exempt from disclosure pursuant to Health and Safety Code, §108.10 and §108.13, and shall not be released. Likewise, patient specific data collected by the council through audits of hospital data shall not be released.

(b)

Creation of public use data file - The executive director will create a public use data file by creating a single record for each inpatient discharge and adding, modifying or deleting data elements in the following manner:

(1)

Delete patient and insured name, address, certificate and social security data elements. Delete patient control and medical record numbers. Assign geographic identifier and county code.

(2)

Convert patient birth date to age.

(3)

Convert admission and discharge dates to a length of stay measured in days and a code for the day of the week of the admission.

(4)

Convert procedure and occurrence dates to day of stay values.

(5)

Delete physician and other health professional names and numbers.

(6)

Convert payor names and identification numbers to uniform payor identifiers.

(7)

Convert employer name and address data to a Standard Industrial Classification Code.

(8)

Delete provider name address and identification numbers. Assign facility identifier.

(9)

Convert all procedure codes to ICD-9-CM.

(10)

Add risk and severity adjustment scores.

(c)

Release of files and statistical compilations based on the public use data file. The council shall promptly provide data to those requesting it, subject to restrictions imposed by Health and Safety Code, §108.10 and 108.13 as interpreted by the council's rules.

(1)

The executive director will make available a public use data file on magnetic media for each quarter not later than seven months after the end of the quarter.

(A)

The executive director shall release discharge files from hospitals that have certified the data as required by §1301.17 of this title (relating to Certification of Discharge Reports). A hospital's failure to execute the certification form after six months shall not prevent the executive director from releasing the hospital's data if he believes the data submitted is reasonably accurate and complete. The executive director shall not include in the public use data file records derived from hospital discharge files which contain material errors. The executive director will include with the public use data file information on the number of discharge files received from each hospital and the number of discharge files from each hospital included on the public use data file.

(B)

If additional discharge files become available after the initial release of the public use data file for any quarter, the executive director will add these records to the public use data file and make the additional records available to the public.

(C)

The other sections of this rule not withstanding, the executive director shall not create a public use data file from the discharge reports covering discharges occurring in the first or second quarters of 1997. It is the intent of the council to utilize this data only for testing and calibration of its data processing systems and to allow hospitals the opportunity to test and calibrate their own data reporting systems.

(D)

The other sections of this rule not withstanding, the executive director shall not create or release a public use data file from discharge reports covering discharges for the third quarter of 1997 until a public use data file covering discharges for the fourth quarter of 1997 is created and released. The council will initially release six months of data in order to provide a more reliable body of data for analysis and decision-making and to make available public use data files on a quarterly schedule thereafter.

(2)

The public may request the executive director to prepare statistical compilations based on public use data files. The executive director will take the steps necessary to fill these requests by providing the public with on-line access to public use data files and statistical report software and by preparing statistical compilations to user specifications.

(3)

The council shall establish standard forms for ordering public use data files and statistical compilations based on public use data files. The council shall provide for computer to computer access to allow persons to make requests using electronic mail and to download public use data files and statistical compilations based on public use data files. The council shall also fill requests on magnetic media and on paper as specified by the requestor. The council's service standard shall be to normally fill requests within five working days of receipt of the request and payment for the request. The executive director shall establish procedures to accommodate standing orders for recurring requests.

(4)

The council shall adopt a fee schedule for filling requests for public use data files and statistical compilations based on public use data files, and shall update this fee schedule at least annually. In adopting a fee schedule the council shall strike a reasonable balance between the statutory goals of improved public access to health care data (Health and Safety Code, §108.013(a)), and the goal of providing part of the costs of operation of the council through user fees (Health and Safety Code, §108.12(b)). The executive director shall establish procedures for providing price quotations to requestors and for collecting user fees prior to filling requests. These procedures may include the establishment of advance deposit accounts by requestors. This fee schedule may include restrictions on distribution, republication or reuse of the data in ways that would diminish user fees to the Council.

(5)

The council shall not charge Texas state agencies a fee for data requested solely for the internal use of the agency to comply with Health and Safety Code, §108.12(b). Prior to filling the request of a state agency without fee, the executive director shall secure an interagency agreement imposing restrictions on distribution, republication or reuse of the data in ways that would diminish user fees to the council.

(6)

The executive director shall establish procedures for screening all requests to assure that filling the request will not violate the provisions of Health and Safety Code, §108.13(c).

(d)

The data elements specified for discharge reports in §1301.19 of this title (relating to Discharge Reports - Records, Data Fields and Codes) do not constitute "Provider Quality Data" as discussed in Health and Safety Code, §108.10. Statistical compilations compiled from public use data files may be released with or without either discharge-specific or aggregate provider quality data. Statistical compilations without provider quality data are not subject to the restrictions imposed on the council by Health and Safety Code, §108.10. Public use data files and statistical compilations compiled from public use data files with provider quality data may only be released subject to the restrictions in Health and Safety Code, §108.10, and rules adopted by the council to implement this section of the statute.

(e)

A public use data file or a statistical compilation compiled from public use data files which is specified by the requestor shall not be considered a "report issued by the Council" as referenced in Health and Safety Code, §108.11(f). No opportunity for review or comment by providers whose discharges may be included in the file or statistical compilation is required prior to release of the data to the requestor.

(f)

Requests for data files and statistical compilations based on public use data files including data on one or more provider are matters of public record and copies of all requests shall be maintained by the council for two years from the date of receipt. The executive director will transmit monthly a summary of all requests received to all hospitals submitting discharge data to comply with Health and Safety Code, §108.11(e).

(g)

With any public use data file or any statistical compilation prepared by the council, the executive director shall attach all comments submitted by providers which relate to any data included in the file or compilation.

§1301.19.Discharge Reports - Records, Data Fields and Codes.

(a)

Discharge reports shall be submitted in the national standard flat file format for inpatient hospital bills defined by the United States Department of Health and Human Services, Health Care Finance Administration (HCFA); commonly known as the HCFA 1450. HCFA updates this format from time to time by issuing new versions. The council will accept discharge reports in the latest version or in the immediately preceding version. At the effective date of this rule, the latest version was version 4.1 and the immediately preceding version was version 4.0. The council will make detailed specifications for these formats available to submitters and to the public.

(b)

Except as otherwise provided in this section, discharge reports shall be submitted using the national uniform billing data element specifications as developed by the National Uniform Billing Committee (NUBC) as published by the State Uniform Billing Committee (SUBC) with instructions specific to Texas third party fiscal intermediaries in the Texas UB-92 Manual. The NUBC revises these data element specifications from time to time and the SUBC publishes revisions showing the effective date for changes to each data element. Hospitals shall submit discharge reports using the data element specifications in effect as of