“Texas faces unique challenges when it comes to health care delivery, and Washington’s one-size-fits-all approach doesn’t fit our needs.”


that failed to pass in the regular session of the 2011 Texas Legislature. Among other provisions are expanding Medicaid managed care to the Lower Rio Grande Valley and rural Texas and authorizing Texas to enter into an interstate compact with one or more other states to petition Congress for block grants to effectively take full control of both Medicaid and Medicare for Texas’ poor and elderly. The bill also includes several other Med- icaid cost-savings initiatives, provisions to address immunizations for health care workers, and a prohibition on the use of state or local tax dollars for elective abortions.


Senator Nelson filed legislation to cre- ate the collaboratives in 2009 and again this year. Lt. Gov. David Dewhurst and other state officials strongly backed it. They were looking for innovative ways to control health care costs.


In signing the bill into law on July 18,


Obama’s health system reform law. Some physician groups and hospital networks have indicated they will not participate in the Medicare ACOs.


Physicians complain that draft rules for that program are so prescriptive that rewards for providing high-quality care are virtually unattainable. And, the pro- posed rules appear to give hospitals too much control over ACO operations. Now, however, physicians here may


have a Texas-style alternative, thanks to legislation passed in the special session of the legislature that ended in late June. Senate Bill 7, authored by Sen. Jane Nelson (R-Flower Mound), authorized physicians, hospitals, and other health care providers to create health care col- laboratives, similar to ACOs, to allow traditional competitors to join forces to improve quality of care and lower over- all costs. The measure, sponsored in the Texas House by Rep. John Zerwas, MD (R-Richmond), also has legal pro- tections so these collaboratives don’t run afoul of federal antitrust laws.


“This law gives Asa Lockhart, MD


providers flexibility to work together


32 TEXAS MEDICINE September 2011


to improve quality of care and reduce costs,” Senator Nelson said. “It does so by removing regulatory barriers so phy- sicians and other providers can collab- orate to achieve the best outcomes for their patients.”


Only time will tell if physicians will be eager to participate in these entities, particularly because many of the details were left up to rulemaking by the Texas Department of Insurance (TDI) and Tex- as Attorney General Greg Abbott’s office. But Tyler anesthesiologist Asa Lock- hart, MD, who testified on the legislation in both the regular and special sessions earlier this year, says he’s optimistic phy- sicians will get on board because TMA worked hard to ensure that they will have an equal voice in the governance of these entities.


“I think physicians will want to par- ticipate because it is going to provide an alternative for innovation, an alterna- tive that allows really local innovation,” said Dr. Lockhart, chair of TMA’s Ad Hoc Committee on Accountable Care Organi- zations. “I think that will be one of the key differences between SB 7 and the federal legislation.”


The Texas vision


SB 7 is a wide-ranging law that includes a number of health care-related issues


Gov. Rick Perry hailed the measure as a Texas solution to the daunting problems that face our health care system. “Texas faces unique challenges when it comes to health care delivery, and Wash- ington’s one-size-fits-all approach doesn’t fit our needs,” he said. “SB 7 provides state-based solutions to rising health care costs by providing millions in sav- ings, rewarding innovation, and improv- ing the health care of Texas.” Dr. Lockhart says the lawmakers rec- ognized that “the status quo was not sus- tainable and we need a different model” for health care delivery. While many feel the federal ACO model contains some good concepts, there has been a loud chorus against the way the U.S. Depart- ment of Health and Human Services and Centers for Medicare & Medicaid Servic- es (CMS) are rolling it out under the so- called Medicare Shared Savings Program. Dr. Lockhart says many Texas physi- cians do not believe ACOs are workable under the federal rules. “And it’s not just Texas. Various foundations and large group practices from across the county are saying the CMS rules will have to change substantially for that to work.” Under SB 7, competing physicians in


a community or a group of physicians, hospitals, and other health care profes- sionals could form a health care collab-


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