CHAPTER 36. MEDICAID FRAUD PREVENTION

State Codes and Statutes

Statutes > Texas > Human-resources-code > Title-2-department-of-human-services-and-department-of-protective-and-regulatory-services > Chapter-36-medicaid-fraud-prevention

HUMAN RESOURCES CODE

TITLE 2. DEPARTMENT OF HUMAN SERVICES AND DEPARTMENT OF

PROTECTIVE AND REGULATORY SERVICES

SUBTITLE C. ASSISTANCE PROGRAMS

CHAPTER 36. MEDICAID FRAUD PREVENTION

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 36.001. DEFINITIONS. In this chapter:

(1) "Claim" means a written or electronically submitted request

or demand that:

(A) is signed by a provider or a fiscal agent and that

identifies a product or service provided or purported to have

been provided to a Medicaid recipient as reimbursable under the

Medicaid program, without regard to whether the money that is

requested or demanded is paid; or

(B) states the income earned or expense incurred by a provider

in providing a product or a service and that is used to determine

a rate of payment under the Medicaid program.

(2) "Documentary material" means a record, document, or other

tangible item of any form, including:

(A) a medical document or X ray prepared by a person in relation

to the provision or purported provision of a product or service

to a Medicaid recipient;

(B) a medical, professional, or business record relating to:

(i) the provision of a product or service to a Medicaid

recipient; or

(ii) a rate or amount paid or claimed for a product or service,

including a record relating to a product or service provided to a

person other than a Medicaid recipient as needed to verify the

rate or amount;

health care providers; or

(D) a record necessary to disclose the extent of services a

provider furnishes to Medicaid recipients.

(3) "Fiscal agent" means:

(A) a person who, through a contractual relationship with the

Texas Department of Human Services, the Texas Department of

Health, or another state agency, receives, processes, and pays a

claim under the Medicaid program; or

(B) the designated agent of a person described by Paragraph (A).

(4) "Health care practitioner" means a dentist, podiatrist,

psychologist, physical therapist, chiropractor, registered nurse,

or other provider licensed to provide health care services in

this state.

(5) "Managed care organization" has the meaning assigned by

Section 32.039(a).

(6) "Medicaid program" means the state Medicaid program.

(7) "Medicaid recipient" means an individual on whose behalf a

person claims or receives a payment from the Medicaid program or

a fiscal agent, without regard to whether the individual was

eligible for benefits under the Medicaid program.

(8) "Physician" means a physician licensed to practice medicine

in this state.

(9) "Provider" means a person who participates in or who has

applied to participate in the Medicaid program as a supplier of a

product or service and includes:

(A) a management company that manages, operates, or controls

another provider;

(B) a person, including a medical vendor, that provides a

product or service to a provider or to a fiscal agent;

(D) a managed care organization; and

(E) a manufacturer or distributor of a product for which the

Medicaid program provides reimbursement.

(10) "Service" includes care or treatment of a Medicaid

recipient.

(11) "Signed" means to have affixed a signature directly or

indirectly by means of handwriting, typewriting, signature stamp,

computer impulse, or other means recognized by law.

(12) "Unlawful act" means an act declared to be unlawful under

Section 36.002.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1997, 75th Leg., ch. 1153, Sec. 4.02, eff.

Sept. 1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 1, eff. September 1, 2005.

Sec. 36.0011. CULPABLE MENTAL STATE. (a) For purposes of this

chapter, a person acts "knowingly" with respect to information if

the person:

(1) has knowledge of the information;

(2) acts with conscious indifference to the truth or falsity of

the information; or

(3) acts in reckless disregard of the truth or falsity of the

information.

(b) Proof of the person's specific intent to commit an unlawful

act under Section 36.002 is not required in a civil or

administrative proceeding to show that a person acted "knowingly"

with respect to information under this chapter.

Added by Acts 2005, 79th Leg., Ch.

806, Sec. 2, eff. September 1, 2005.

Sec. 36.002. UNLAWFUL ACTS. A person commits an unlawful act if

the person:

(1) knowingly makes or causes to be made a false statement or

misrepresentation of a material fact to permit a person to

receive a benefit or payment under the Medicaid program that is

not authorized or that is greater than the benefit or payment

that is authorized;

(2) knowingly conceals or fails to disclose information that

permits a person to receive a benefit or payment under the

Medicaid program that is not authorized or that is greater than

the benefit or payment that is authorized;

(3) knowingly applies for and receives a benefit or payment on

behalf of another person under the Medicaid program and converts

any part of the benefit or payment to a use other than for the

benefit of the person on whose behalf it was received;

(4) knowingly makes, causes to be made, induces, or seeks to

induce the making of a false statement or misrepresentation of

material fact concerning:

(A) the conditions or operation of a facility in order that the

facility may qualify for certification or recertification

required by the Medicaid program, including certification or

recertification as:

(i) a hospital;

(ii) a nursing facility or skilled nursing facility;

(iii) a hospice;

(iv) an intermediate care facility for the mentally retarded;

(v) an assisted living facility; or

(vi) a home health agency; or

(B) information required to be provided by a federal or state

law, rule, regulation, or provider agreement pertaining to the

Medicaid program;

(5) except as authorized under the Medicaid program, knowingly

pays, charges, solicits, accepts, or receives, in addition to an

amount paid under the Medicaid program, a gift, money, a

donation, or other consideration as a condition to the provision

of a service or product or the continued provision of a service

or product if the cost of the service or product is paid for, in

whole or in part, under the Medicaid program;

(6) knowingly presents or causes to be presented a claim for

payment under the Medicaid program for a product provided or a

service rendered by a person who:

(A) is not licensed to provide the product or render the

service, if a license is required; or

(B) is not licensed in the manner claimed;

(7) knowingly makes a claim under the Medicaid program for:

(A) a service or product that has not been approved or

acquiesced in by a treating physician or health care

practitioner;

(B) a service or product that is substantially inadequate or

inappropriate when compared to generally recognized standards

within the particular discipline or within the health care

industry; or

that is otherwise inappropriate;

(8) makes a claim under the Medicaid program and knowingly fails

to indicate the type of license and the identification number of

the licensed health care provider who actually provided the

service;

(9) knowingly enters into an agreement, combination, or

conspiracy to defraud the state by obtaining or aiding another

person in obtaining an unauthorized payment or benefit from the

Medicaid program or a fiscal agent;

(10) is a managed care organization that contracts with the

Health and Human Services Commission or other state agency to

provide or arrange to provide health care benefits or services to

individuals eligible under the Medicaid program and knowingly:

(A) fails to provide to an individual a health care benefit or

service that the organization is required to provide under the

contract;

(B) fails to provide to the commission or appropriate state

agency information required to be provided by law, commission or

agency rule, or contractual provision; or

enrollment of an individual eligible under the Medicaid program

in the organization's managed care plan or in connection with

marketing the organization's services to an individual eligible

under the Medicaid program;

(11) knowingly obstructs an investigation by the attorney

general of an alleged unlawful act under this section;

(12) knowingly makes, uses, or causes the making or use of a

false record or statement to conceal, avoid, or decrease an

obligation to pay or transmit money or property to this state

under the Medicaid program; or

(13) knowingly engages in conduct that constitutes a violation

under Section 32.039(b).

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1997, 75th Leg., ch. 1153, Sec. 4.03, eff.

Sept. 1, 1997; Acts 1999, 76th Leg., ch. 233, Sec. 4, eff. Sept.

1, 1999.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 3, eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch.

78, Sec. 1, eff. September 1, 2007.

Sec. 36.003. DOCUMENTARY MATERIAL IN POSSESSION OF STATE AGENCY.

(a) A state agency, including the Health and Human Services

Commission, the Texas Department of Human Services, the Texas

Department of Health, the Texas Department of Mental Health and

Mental Retardation, or the Department of Protective and

Regulatory Services, shall provide the attorney general access to

all documentary materials of persons and Medicaid recipients

under the Medicaid program to which that agency has access.

Documentary material provided under this subsection is provided

to permit investigation of an alleged unlawful act or for use or

potential use in an administrative or judicial proceeding.

(b) Except as ordered by a court for good cause shown, the

office of the attorney general may not produce for inspection or

copying or otherwise disclose the contents of documentary

material obtained under this section to a person other than:

(1) an employee of the attorney general;

(2) an agency of this state, the United States, or another

state;

(3) a criminal district attorney, district attorney, or county

attorney of this state;

(4) the United States attorney general;

(5) a state or federal grand jury;

(6) a political subdivision of this state; or

(7) a person authorized by the attorney general to receive the

information.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.007 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(a), eff. Sept. 1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 4, eff. September 1, 2005.

Sec. 36.004. IMMUNITY. Notwithstanding any other law, a person

is not civilly or criminally liable for providing access to

documentary material under this chapter to:

(1) an employee of the attorney general;

(2) an agency of this state, the United States, or another

state;

(3) a criminal district attorney, district attorney, or county

attorney of this state;

(4) the United States attorney general;

(5) a state or federal grand jury;

(6) a political subdivision of this state; or

(7) a person authorized by the attorney general to receive the

information.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.008 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(a), eff. Sept. 1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 5, eff. September 1, 2005.

Sec. 36.005. SUSPENSION OR REVOCATION OF AGREEMENT; PROFESSIONAL

DISCIPLINE. (a) A health and human services agency, as defined

by Section 531.001, Government Code:

(1) shall suspend or revoke:

(A) a provider agreement between the agency and a person, other

than a person who operates a nursing facility or an ICF-MR

facility, found liable under Section 36.052; and

(B) a permit, license, or certification granted by the agency to

a person, other than a person who operates a nursing facility or

an ICF-MR facility, found liable under Section 36.052; and

(2) may suspend or revoke:

(A) a provider agreement between the agency and a person who

operates a nursing facility or an ICF-MR facility and who is

found liable under Section 36.052; or

(B) a permit, license, or certification granted by the agency to

a person who operates a nursing facility or an ICF-MR facility

and who is found liable under Section 36.052.

(b) A provider found liable under Section 36.052 for an unlawful

act may not, for a period of 10 years, provide or arrange to

provide health care services under the Medicaid program or supply

or sell, directly or indirectly, a product to or under the

Medicaid program. The executive commissioner of the Health and

Human Services Commission may by rule:

(1) provide for a period of ineligibility longer than 10 years;

(2) grant a provider a full or partial exemption from the period

of ineligibility required by this subsection if the executive

commissioner finds that enforcement of the full period of

ineligibility is harmful to the Medicaid program or a beneficiary

of the program.

(b-1) The period of ineligibility begins on the date on which

the determination that the provider is liable becomes final.

(b-2) Subsections (b) and (b-1) do not apply to a provider who

operates a nursing facility or an ICF-MR facility.

an unlawful act is subject to professional discipline under the

applicable licensing law or rules adopted under that law.

(d) For purposes of this section, a person is considered to have

been found liable under Section 36.052 if the person is found

liable in an action brought under Subchapter C.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.009 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(a), eff. Sept. 1, 1997.

Amended by Acts 1997, 75th Leg., ch. 1153, Sec. 4.06, eff. Sept.

1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 6, eff. September 1, 2005.

Sec. 36.006. APPLICATION OF OTHER LAW. The application of a

civil remedy under this chapter does not preclude the application

of another common law, statutory, or regulatory remedy, except

that a person may not be liable for a civil remedy under this

chapter and civil damages or a penalty under Section 32.039 if

the civil remedy and civil damages or penalty are assessed for

the same act.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.010 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(a), eff. Sept. 1, 1997.

Sec. 36.007. RECOVERY OF COSTS, FEES, AND EXPENSES. The

attorney general may recover fees, expenses, and costs reasonably

incurred in obtaining injunctive relief or civil remedies or in

conducting investigations under this chapter, including court

costs, reasonable attorney's fees, witness fees, and deposition

fees.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.011 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(a), eff. Sept. 1, 1997.

Sec. 36.008. USE OF MONEY RECOVERED. The legislature, in

appropriating money recovered under this chapter, shall consider

the requirements of the attorney general and other affected state

agencies in investigating Medicaid fraud and enforcing this

chapter.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.012 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(a), eff. Sept. 1, 1997.

SUBCHAPTER B. ACTION BY ATTORNEY GENERAL

Sec. 36.051. INJUNCTIVE RELIEF. (a) If the attorney general

has reason to believe that a person is committing, has committed,

or is about to commit an unlawful act, the attorney general may

institute an action for an appropriate order to restrain the

person from committing or continuing to commit the act.

(b) An action under this section shall be brought in a district

court of Travis County or of a county in which any part of the

unlawful act occurred, is occurring, or is about to occur.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.003 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(b), eff. Sept. 1, 1997.

Sec. 36.052. CIVIL REMEDIES. (a) Except as provided by

Subsection (c), a person who commits an unlawful act is liable to

the state for:

(1) the amount of any payment or the value of any monetary or

in-kind benefit provided under the Medicaid program, directly or

indirectly, as a result of the unlawful act, including any

payment made to a third party;

(2) interest on the amount of the payment or the value of the

benefit described by Subdivision (1) at the prejudgment interest

rate in effect on the day the payment or benefit was received or

paid, for the period from the date the benefit was received or

paid to the date that the state recovers the amount of the

payment or value of the benefit;

(3) a civil penalty of:

(A) not less than $5,000 or more than $15,000 for each unlawful

act committed by the person that results in injury to an elderly

person, as defined by Section 48.002(a)(1), a disabled person, as

defined by Section 48.002(a)(8)(A), or a person younger than 18

years of age; or

(B) not less than $5,000 or more than $10,000 for each unlawful

act committed by the person that does not result in injury to a

person described by Paragraph (A); and

(4) two times the amount of the payment or the value of the

benefit described by Subdivision (1).

(b) In determining the amount of the civil penalty described by

Subsection (a)(3), the trier of fact shall consider:

(1) whether the person has previously violated the provisions of

this chapter;

(2) the seriousness of the unlawful act committed by the person,

including the nature, circumstances, extent, and gravity of the

unlawful act;

(3) whether the health and safety of the public or an individual

was threatened by the unlawful act;

(4) whether the person acted in bad faith when the person

engaged in the conduct that formed the basis of the unlawful act;

and

(5) the amount necessary to deter future unlawful acts.

times the amount of a payment or the value of a benefit described

by Subsection (a)(1) if the trier of fact finds that:

(1) the person furnished the attorney general with all

information known to the person about the unlawful act not later

than the 30th day after the date on which the person first

obtained the information; and

(2) at the time the person furnished all the information to the

attorney general, the attorney general had not yet begun an

investigation under this chapter.

(d) An action under this section shall be brought in Travis

County or in a county in which any part of the unlawful act

occurred.

(e) The attorney general may:

(1) bring an action for civil remedies under this section

together with a suit for injunctive relief under Section 36.051;

(2) institute an action for civil remedies independently of an

action for injunctive relief.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.004 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(b), eff. Sept. 1, 1997.

Amended by Acts 1997, 75th Leg., ch. 1153, Sec. 4.04, eff. Sept.

1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 7, eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch.

29, Sec. 1, eff. May 4, 2007.

Sec. 36.053. INVESTIGATION. (a) The attorney general may take

action under Subsection (b) if the attorney general has reason to

believe that:

(1) a person has information or custody or control of

documentary material relevant to the subject matter of an

investigation of an alleged unlawful act;

(2) a person is committing, has committed, or is about to commit

an unlawful act; or

(3) it is in the public interest to conduct an investigation to

ascertain whether a person is committing, has committed, or is

about to commit an unlawful act.

(b) In investigating an unlawful act, the attorney general may:

(1) require the person to file on a prescribed form a statement

in writing, under oath or affirmation, as to all the facts and

circumstances concerning the alleged unlawful act and other

information considered necessary by the attorney general;

(2) examine under oath a person in connection with the alleged

unlawful act; and

(3) execute in writing and serve on the person a civil

investigative demand requiring the person to produce the

documentary material and permit inspection and copying of the

material under Section 36.054.

disclose information that is obtained under Subsection (b)(1) or

(2) or any documentary material or other record derived from the

information except:

(1) by court order for good cause shown;

(2) with the consent of the person who provided the information;

(3) to an employee of the attorney general;

(4) to an agency of this state, the United States, or another

state;

(5) to any attorney representing the state under Section 36.055

or in a civil action brought under Subchapter C;

(6) to a political subdivision of this state; or

(7) to a person authorized by the attorney general to receive

the information.

(d) The attorney general may use documentary material derived

from information obtained under Subsection (b)(1) or (2), or

copies of that material, as the attorney general determines

necessary in the enforcement of this chapter, including

presentation before a court.

(e) If a person fails to file a statement as required by

Subsection (b)(1) or fails to submit to an examination as

required by Subsection (b)(2), the attorney general may file in a

district court of Travis County a petition for an order to compel

the person to file the statement or submit to the examination

within a period stated by court order. Failure to comply with an

order entered under this subsection is punishable as contempt.

(f) An order issued by a district court under this section is

subject to appeal to the supreme court.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.005 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(b), eff. Sept. 1, 1997.

Amended by Acts 1997, 75th Leg., ch. 1153, Sec. 4.05, eff. Sept.

1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 8, eff. September 1, 2005.

Sec. 36.054. CIVIL INVESTIGATIVE DEMAND. (a) An investigative

demand must:

(1) state the rule or statute under which the alleged unlawful

act is being investigated and the general subject matter of the

investigation;

(2) describe the class or classes of documentary material to be

produced with reasonable specificity to fairly indicate the

documentary material demanded;

(3) prescribe a return date within which the documentary

material is to be produced; and

(4) identify an authorized employee of the attorney general to

whom the documentary material is to be made available for

inspection and copying.

(b) A civil investigative demand may require disclosure of any

documentary material that is discoverable under the Texas Rules

of Civil Procedure.

(1) delivering an executed copy of the demand to the person to

be served or to a partner, an officer, or an agent authorized by

appointment or by law to receive service of process on behalf of

that person;

(2) delivering an executed copy of the demand to the principal

place of business in this state of the person to be served; or

(3) mailing by registered or certified mail an executed copy of

the demand addressed to the person to be served at the person's

principal place of business in this state or, if the person has

no place of business in this state, to a person's principal

office or place of business.

(d) Documentary material demanded under this section shall be

produced for inspection and copying during normal business hours

at the office of the attorney general or as agreed by the person

served and the attorney general.

(e) The office of the attorney general may not produce for

inspection or copying or otherwise disclose the contents of

documentary material obtained under this section except:

(1) by court order for good cause shown;

(2) with the consent of the person who produced the information;

(3) to an employee of the attorney general;

(4) to an agency of this state, the United States, or another

state;

(5) to any attorney representing the state under Section 36.055

or in a civil action brought under Subchapter C;

(6) to a political subdivision of this state; or

(7) to a person authorized by the attorney general to receive

the information.

(e-1) The attorney general shall prescribe reasonable terms and

conditions allowing the documentary material to be available for

inspection and copying by the person who produced the material or

by an authorized representative of that person. The attorney

general may use the documentary material or copies of it as the

attorney general determines necessary in the enforcement of this

chapter, including presentation before a court.

(f) A person may file a petition, stating good cause, to extend

the return date for the demand or to modify or set aside the

demand. A petition under this section shall be filed in a

district court of Travis County and must be filed before the

earlier of:

(1) the return date specified in the demand; or

(2) the 20th day after the date the demand is served.

(g) Except as provided by court order, a person on whom a demand

has been served under this section shall comply with the terms of

an investigative demand.

(h) A person who has committed an unlawful act in relation to

the Medicaid program in this state has submitted to the

jurisdiction of this state and personal service of an

investigative demand under this section may be made on the person

outside of this state.

(i) This section does not limit the authority of the attorney

general to conduct investigations or to access a person's

documentary materials or other information under another state or

federal law, the Texas Rules of Civil Procedure, or the Federal

Rules of Civil Procedure.

(j) If a person fails to comply with an investigative demand, or

if copying and reproduction of the documentary material demanded

cannot be satisfactorily accomplished and the person refuses to

surrender the documentary material, the attorney general may file

in a district court of Travis County a petition for an order to

enforce the investigative demand.

(k) If a petition is filed under Subsection (j), the court may

determine the matter presented and may enter an order to

implement this section.

(l) Failure to comply with a final order entered under

Subsection (k) is punishable by contempt.

(m) A final order issued by a district court under Subsection

(k) is subject to appeal to the supreme court.

Added by Acts 1995, 74th Leg., ch. 824, Sec. 1, eff. Sept. 1,

1995. Renumbered from Human Resources Code Sec. 36.006 by Acts

1997, 75th Leg., ch. 1153, Sec. 4.01(b), eff. Sept. 1, 1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 9, eff. September 1, 2005.

Sec. 36.055. ATTORNEY GENERAL AS RELATOR IN FEDERAL ACTION. To

the extent permitted by 31 U.S.C. Sections 3729-3733, the

attorney general may bring an action as relator under 31 U.S.C.

Section 3730 with respect to an act in connection with the

Medicaid program for which a person may be held liable under 31

U.S.C. Section 3729. The attorney general may contract with a

private attorney to represent the state under this section.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.07(a), eff. Sept.

1, 1997.

SUBCHAPTER C. ACTION BY PRIVATE PERSONS

Sec. 36.101. ACTION BY PRIVATE PERSON AUTHORIZED. (a) A person

may bring a civil action for a violation of Section 36.002 for

the person and for the state. The action shall be brought in the

name of the person and of the state.

(b) In an action brought under this subchapter, a person who

violates Section 36.002 is liable as provided by Section 36.052.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.102. INITIATION OF ACTION. (a) A person bringing an

action under this subchapter shall serve a copy of the petition

and a written disclosure of substantially all material evidence

and information the person possesses on the attorney general in

compliance with the Texas Rules of Civil Procedure.

(b) The petition shall be filed in camera and, except as

provided by Subsection (c-1) or (d), shall remain under seal

until at least the 180th day after the date the petition is filed

or the date on which the state elects to intervene, whichever is

earlier. The petition may not be served on the defendant until

the court orders service on the defendant.

not later than the 180th day after the date the attorney general

receives the petition and the material evidence and information.

(c-1) At the time the state intervenes, the attorney general may

file a motion with the court requesting that the petition remain

under seal for an extended period.

(d) The state may, for good cause shown, move the court to

extend the 180-day deadline under Subsection (b) or (c). A

motion under this subsection may be supported by affidavits or

other submissions in camera.

(e) An action under this subchapter may be dismissed before the

end of the period during which the petition remains under seal

only if the court and the attorney general consent in writing to

the dismissal and state their reasons for consenting.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 10, eff. September 1, 2005.

Sec. 36.1021. STANDARD OF PROOF. In an action under this

subchapter, the state or person bringing the action must

establish each element of the action, including damages, by a

preponderance of the evidence.

Added by Acts 2007, 80th Leg., R.S., Ch.

29, Sec. 2, eff. May 4, 2007.

Sec. 36.103. ANSWER BY DEFENDANT. A defendant is not required

to file in accordance with the Texas Rules of Civil Procedure an

answer to a petition filed under this subchapter until the

petition is unsealed and served on the defendant.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 11, eff. September 1, 2005.

Sec. 36.104. STATE DECISION; CONTINUATION OF ACTION. (a) Not

later than the last day of the period prescribed by Section

36.102(c) or an extension of that period as provided by Section

36.102(d), the state shall:

(1) proceed with the action; or

(2) notify the court that the state declines to take over the

action.

(b) If the state declines to take over the action, the person

bringing the action may proceed without the state's

participation. On request by the state, the state is entitled to

be served with copies of all pleadings filed in the action and be

provided at the state's expense with copies of all deposition

transcripts. If the person bringing the action proceeds without

the state's participation, the court, without limiting the status

and right of that person, may permit the state to intervene at a

later date on a showing of good cause.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 12, eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch.

29, Sec. 3, eff. May 4, 2007.

Acts 2007, 80th Leg., R.S., Ch.

29, Sec. 4, eff. May 4, 2007.

Sec. 36.105. REPRESENTATION OF STATE BY PRIVATE ATTORNEY. The

attorney general may contract with a private attorney to

represent the state in an action under this subchapter with which

the state elects to proceed.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.106. INTERVENTION BY OTHER PARTIES PROHIBITED. A person

other than the state may not intervene or bring a related action

based on the facts underlying a pending action brought under this

subchapter.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.107. RIGHTS OF PARTIES IF STATE CONTINUES ACTION. (a)

If the state proceeds with the action, the state has the primary

responsibility for prosecuting the action and is not bound by an

act of the person bringing the action. The person bringing the

action has the right to continue as a party to the action,

subject to the limitations set forth by this section.

(b) The state may dismiss the action notwithstanding the

objections of the person bringing the action if:

(1) the attorney general notifies the person that the state has

filed a motion to dismiss; and

(2) the court provides the person with an opportunity for a

hearing on the motion.

notwithstanding the objections of the person bringing the action

if the court determines, after a hearing, that the proposed

settlement is fair, adequate, and reasonable under all the

circumstances. On a showing of good cause, the hearing may be

held in camera.

(d) On a showing by the state that unrestricted participation

during the course of the litigation by the person bringing the

action would interfere with or unduly delay the state's

prosecution of the case, or would be repetitious, irrelevant, or

for purposes of harassment, the court may impose limitations on

the person's participation, including:

(1) limiting the number of witnesses the person may call;

(2) limiting the length of the testimony of witnesses called by

the person;

(3) limiting the person's cross-examination of witnesses; or

(4) otherwise limiting the participation by the person in the

litigation.

(e) On a showing by the defendant that unrestricted

participation during the course of the litigation by the person

bringing the action would be for purposes of harassment or would

cause the defendant undue burden or unnecessary expense, the

court may limit the participation by the person in the

litigation.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.108. STAY OF CERTAIN DISCOVERY. (a) On a showing by

the state that certain actions of discovery by the person

bringing the action would interfere with the state's

investigation or prosecution of a criminal or civil matter

arising out of the same facts, the court may stay the discovery

for a period not to exceed 60 days.

(b) The court shall hear a motion to stay discovery under this

section in camera.

on a further showing in camera that the state has pursued the

criminal or civil investigation or proceedings with reasonable

diligence and that any proposed discovery in the civil action

will interfere with the ongoing criminal or civil investigation

or proceedings.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.109. PURSUIT OF ALTERNATE REMEDY BY STATE. (a)

Notwithstanding Section 36.101, the state may elect to pursue the

state's claim through any alternate remedy available to the

state, including any administrative proceeding to determine an

administrative penalty. If an alternate remedy is pursued in

another proceeding, the person bringing the action has the same

rights in the other proceeding as the person would have had if

the action had continued under this subchapter.

(b) A finding of fact or conclusion of law made in the other

proceeding that has become final is conclusive on all parties to

an action under this subchapter. For purposes of this subsection,

a finding or conclusion is final if:

(1) the finding or conclusion has been finally determined on

appeal to the appropriate court;

(2) no appeal has been filed with respect to the finding or

conclusion and all time for filing an appeal has expired; or

(3) the finding or conclusion is not subject to judicial review.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.110. AWARD TO PRIVATE PLAINTIFF. (a) If the state

proceeds with an action under this subchapter, the person

bringing the action is entitled, except as provided by Subsection

(b), to receive at least 15 percent but not more than 25 percent

of the proceeds of the action, depending on the extent to which

the person substantially contributed to the prosecution of the

action.

(a-1) If the state does not proceed with an action under this

subchapter, the person bringing the action is entitled, except as

provided by Subsection (b), to receive at least 25 percent but

not more than 30 percent of the proceeds of the action. The

entitlement of a person under this subsection is not affected by

any subsequent intervention in the action by the state in

accordance with Section 36.104(b).

(b) If the court finds that the action is based primarily on

disclosures of specific information, other than information

provided by the person bringing the action, relating to

allegations or transactions in a criminal or civil hearing, in a

legislative or administrative report, hearing, audit, or

investigation, or from the news media, the court may award the

amount the court considers appropriate but not more than seven

percent of the proceeds of the action. The court shall consider

the significance of the information and the role of the person

bringing the action in advancing the case to litigation.

the proceeds of the action. A person receiving a payment under

this section is also entitled to receive from the defendant an

amount for reasonable expenses, reasonable attorney's fees, and

costs that the court finds to have been necessarily incurred.

The court's determination of expenses, fees, and costs to be

awarded under this subsection shall be made only after the

defendant has been found liable in the action.

(d) In this section, "proceeds of the action" includes proceeds

of a settlement of the action.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 13, eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch.

29, Sec. 5, eff. May 4, 2007.

Sec. 36.111. REDUCTION OF AWARD. (a) If the court finds that

the action was brought by a person who planned and initiated the

violation of Section 36.002 on which the action was brought, the

court may, to the extent the court considers appropriate, reduce

the share of the proceeds of the action the person would

otherwise receive under Section 36.110, taking into account the

person's role in advancing the case to litigation and any

relevant circumstances pertaining to the violation.

(b) If the person bringing the action is convicted of criminal

conduct arising from the person's role in the violation of

Section 36.002, the court shall dismiss the person from the civil

action and the person may not receive any share of the proceeds

of the action. A dismissal under this subsection does not

prejudice the right of the state to continue the action.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.112. AWARD TO DEFENDANT FOR FRIVOLOUS ACTION. Chapter

105, Civil Practice and Remedies Code, applies in an action under

this subchapter with which the state proceeds.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.113. CERTAIN ACTIONS BARRED. (a) A person may not

bring an action under this subchapter that is based on

allegations or transactions that are the subject of a civil suit

or an administrative penalty proceeding in which the state is

already a party.

(b) A person may not bring an action under this subchapter that

is based on the public disclosure of allegations or transactions

in a criminal or civil hearing, in a legislative or

administrative report, hearing, audit, or investigation, or from

the news media, unless the person bringing the action is an

original source of the information. In this subsection, "original

source" means an individual who has direct and independent

knowledge of the information on which the allegations are based

and has voluntarily provided the information to the state before

filing an action under this subchapter that is based on the

information.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.114. STATE NOT LIABLE FOR CERTAIN EXPENSES. The state

is not liable for expenses that a person incurs in bringing an

action under this subchapter.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.115. RETALIATION BY EMPLOYER AGAINST PERSON BRINGING

SUIT PROHIBITED. (a) A person who is discharged, demoted,

suspended, threatened, harassed, or in any other manner

discriminated against in the terms of employment by the person's

employer because of a lawful act taken by the person in

furtherance of an action under this subchapter, including

investigation for, initiation of, testimony for, or assistance in

an action filed or to be filed under this subchapter, is entitled

to:

(1) reinstatement with the same seniority status the person

would have had but for the discrimination; and

(2) not less than two times the amount of back pay, interest on

the back pay, and compensation for any special damages sustained

as a result of the discrimination, including litigation costs and

reasonable attorney's fees.

(b) A person may bring an action in the appropriate district

court for the relief provided in this section.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.116. SOVEREIGN IMMUNITY NOT WAIVED. Except as provided

by Section 36.112, this subchapter does not waive sovereign

immunity.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

Sec. 36.117. ATTORNEY GENERAL COMPENSATION. The office of the

attorney general may retain a reasonable portion of recoveries

under this subchapter, not to exceed amounts specified in the

General Appropriations Act, for the administration of this

subchapter.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.08, eff. Sept. 1,

1997.

SUBCHAPTER D. REVOCATION OF CERTAIN OCCUPATIONAL LICENSES

Sec. 36.132. REVOCATION OF LICENSES. (a) In this section:

(1) "License" means a license, certificate, registration,

permit, or other authorization that:

(A) is issued by a licensing authority;

(B) is subject before expiration to suspension, revocation,

forfeiture, or termination by an issuing licensing authority; and

particular business, occupation, or profession.

(2) "Licensing authority" means:

(A) the Texas Medical Board;

(B) the State Board of Dental Examiners;

(D) the Texas State Board of Social Worker Examiners;

(E) the Texas Board of Nursing;

(F) the Texas Board of Physical Therapy Examiners;

(G) the Texas Board of Occupational Therapy Examiners; or

(H) another state agency authorized to regulate a provider who

receives or is eligible to receive payment for a health care

service under the Medicaid program.

(b) A licensing authority shall revoke a license issued by the

authority to a person if the person is convicted of a felony

under Section 35A.02, Penal Code. In revoking the license, the

licensing authority shall comply with all procedures generally

applicable to the licensing authority in revoking licenses.

Added by Acts 1997, 75th Leg., ch. 1153, Sec. 4.09, eff. Sept. 1,

1997. Amended by Acts 2003, 78th Leg., ch. 553, Sec. 2.012, eff.

Feb. 1, 2004.

Amended by:

Acts 2005, 79th Leg., Ch.

806, Sec. 15, eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch.

889, Sec. 70, eff. September 1, 2007.

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

Loading..

Loading, Please Wait!