S.B. No. 1038 aims to enhance the administrative remedies for fraud and abuse violations within the Texas Medicaid program by amending Sections 544.0205 and 32.039 of the Government and Human Resources Codes. The bill replaces the term "administrative penalty" with "remedy," broadening the scope of administrative actions available. It introduces a provision for awarding individuals who report Medicaid fraud or abuse, with a cap of five percent of the recovered remedy. Additionally, the bill clarifies definitions related to Medicaid claims, particularly emphasizing the term "material," which pertains to information that can affect Medicaid benefit decisions.

The legislation also outlines specific violations concerning Medicaid claims, imposing significant administrative penalties for knowingly submitting false claims or engaging in fraudulent activities. It establishes that each day a violation occurs may be treated as a separate offense, increasing potential penalties for ongoing misconduct. The bill mandates that individuals charged with violations receive a detailed written notice from the commission, including a summary of facts and their rights to an informal review, while extending the response timeline from 10 to 30 days. Furthermore, it clarifies that civil remedies do not preclude other legal remedies for the same act and specifies that the bill applies only to violations occurring on or after its effective date of September 1, 2025.

Statutes affected:
Introduced: Human Resources Code 32.039, Human Resources Code 32.0391, Human Resources Code 36.002, Human Resources Code 36.006 (Human Resources Code 36, Human Resources Code 32)
Senate Committee Report: Human Resources Code 32.039, Human Resources Code 32.0391, Human Resources Code 36.006 (Human Resources Code 36, Human Resources Code 32)
Engrossed: Human Resources Code 32.039, Human Resources Code 32.0391, Human Resources Code 36.006 (Human Resources Code 36, Human Resources Code 32)
House Committee Report: Human Resources Code 32.039, Human Resources Code 32.0391, Human Resources Code 36.006 (Human Resources Code 36, Human Resources Code 32)
Enrolled: Human Resources Code 32.039, Human Resources Code 32.0391, Human Resources Code 36.006 (Human Resources Code 36, Human Resources Code 32)