Health Agency Mergers Get House Look

The state’s massive health and human services system would be partially consolidated under a bill heard by the House Human Services Committee on Monday evening. 

Under House Bill 2304 by Four Price, R-Amarillo, three of the state’s five health and human services agencies — the Health and Human Services Commission, the Department of Aging and Disability Services and the Department of Assistive and Rehabilitative Services — would be merged into one “mega-agency” next year.

A recommendation to also consolidate the two other agencies — the Department of State Health Services and the Department of Family and Protective Services — would be left to a committee of four senators, four House members and three public citizens.

That proposal takes a more “graduated approach” to restructuring the agencies, said Price, who stressed that the current agency structure means that “services are fragmented across the system.”

The bill is expected to eventually pass the committee. Its Senate companion, SB 200, passed the full Senate earlier this month.

HB 2304 comes amid controversy at the Health and Human Services Commission over how the agency awarded a $20 million contract to a private company outside of the competitive bidding process.

Kyle Janek, head of the embattled agency, answered questions from lawmakers about how contracting and procurement would work at the newly organized agency, saying administrative consolidation would improve contract oversight.

“Many of the difficulties that we’ve had are because of the fact that we’re not yet complete in that,” he said.

Still, concerns about the new agency structure remain. Anne Dunkelberg, associate director of the left-leaning Center for Public Policy Priorities, wrote Monday that the group would testify about its many concerns with the bill, including “the redirection of agency talent from programs and services to re-structuring” and “the dilution of expertise when agency advisory councils are merged into a single body.”

The bill has gone through several rounds of changes since it was filed this year — a chain of events started last year when the Sunset Advisory Commission recommended that all five agencies be consolidated in the hopes of making them more efficient.

But as the scandal developed at the health commission, lawmakers slowed down their approach to the ambitious recommendations amid enhanced scrutiny of the executive management of the Health and Human Services Commission.

Price said “the brakes have been tapped significantly” on consolidation after two reports published this year — one commissioned by Gov. Greg Abbott, and the other by the state auditor’s office — found the Health and Human Service Commission’s management had made serious missteps in its handling of a private contract for fraud detection software.

“It is now more clear than ever that the Texas Health and Human Services Commission has been riddled with operational, managerial, structural and procedural problems that go far beyond any individual or contract,” Abbott said in a statement at the time. “That is unacceptable.”

The five agencies within the HHSC system have about 54,000 employees and a budget of about $34.5 billion, according to the Sunset Advisory Commission.

HB 2304 could see significant changes as it continues along the legislative process. Last week, Price pulled a separate Sunset bill that would reorganize services at DSHS, the state’s public health agency, from the House floor after debate over the bill morphed into a debate over abortion regulations.

The bill is expected to be left pending in committee.

Disclosure: The Center for Public Policy Priorities is a corporate sponsor of The Texas Tribune. A complete list of Tribune donors and sponsors can be viewed here.

This story was produced in partnership with Kaiser Health News, an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.