Q
What does Texas SB855 do?
Effective September 1, 2025, SB855 authorizes medical consenters (e. g. , foster parents) to bypass the Medicaid STAR Health network and assume personal financial responsibility for out-of-network (OON) medical care.
Signed Into Law
Signed May 21, 2025Effective 2025-09-01
SB855
Regular Session
Relating to the authority of certain medical consenters to assume financial responsibility for certain out-of-network medical care provided to children in foster care.
Government Affairs & Regulatory Compliance Analysis
SB855: Government Affairs Overview
Effective September 1, 2025, SB855 authorizes medical consenters (e. g. , foster parents) to bypass the Medicaid STAR Health network and assume personal financial responsibility for out-of-network (OON) medical care.
Sen. Kevin Sparks·Senate Bill·Regular Session
ModeratePlan for compliance
Low Cost
Effective:2025-09-01
Business Impact
Who SB855 Affects
This legislation has regulatory implications for the following Texas businesses and organizations:
Regulatory Priority: moderate
Notable regulatory updates (effective 2025-09-01). Consider how these changes may affect your operations.
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Healthcare
Affected business types:
- Hospitals
- Healthcare systems
- Medical practices
- Health insurance providers
Estimated Cost Impact
lowMinimal cost impact anticipated.
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SB855
ModerateRelating to the authority of certain medical consenters to assume financial responsibility for certain out-of-network medical care provided to childre...
Moderate Compliance Urgency
Requires near-term attention
Cost Impact
Low
Effective
2025-09-01Enforcing Agencies
DFPSHHSC
Primary Author: Sen. Kevin Sparks
89th Texas Legislature
jdkey.com
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Compliance Analysis
Key implementation requirements and action items for compliance with this legislation
Implementation Timeline
- Effective Date: September 1, 2025.
- Compliance Deadline: September 1, 2025. (Systems and intake forms must be active on this date).
- Agency Rulemaking:
- DFPS: Must prescribe the "form and manner" for consenter notification by 9/1/2025.
- HHSC: Must amend STAR Health contracts by 9/1/2025.
- Regulatory Gray Zone: Section 3 allows for implementation delays if a federal waiver (CMS) is deemed necessary. Monitor HHSC announcements in Q1 2025 for waiver applications.
Immediate Action Plan
- 1. OON Providers: Draft a "Foster Care Private Pay Agreement" immediately. Ensure it includes a waiver of Medicaid billing.
- 2. MCOs: Audit utilization management software. Ensure that "out-of-network" flags do not automatically trigger coverage denials for subsequent in-network care (e.g., a private specialist orders a test that an in-network lab performs).
- 3. Compliance Officers: Monitor the Texas Register for the DFPS "Notification Form" proposal. Submit comments if the proposed form does not require sufficient clinical detail for continuity of care.
- 4. Legal: Review commercial insurance coordination of benefits (COB) policies. If a foster parent adds a child to a private plan, that plan becomes primary, with Medicaid as the payer of last resort.
Operational Changes Required
Contracts
- Managed Care Organizations (MCOs): You must execute amended contracts with HHSC. These amendments will explicitly prohibit "adverse actions" against enrollees who utilize self-funded OON care. Legal teams must review these amendments to ensure "adverse action" is clearly defined.
- OON Providers: You do not need state contracts, but you must implement a specific "Financial Responsibility Waiver" for these patients. This document must explicitly state that the consenter accepts full liability and acknowledges that Medicaid will not be billed.
Hiring/Training
- Provider Intake Staff: Front-desk staff must be trained to identify foster children presenting as "private pay." They must verify the individual is an authorized "medical consenter" under Family Code Section 266.004(b) before rendering services.
- MCO Case Managers: Staff must be retrained to coordinate care based on external data (Health Passport) rather than internal claims data, ensuring that a lack of internal claims does not trigger "failure to seek care" protocols.
Reporting & Record-Keeping
- Medical Consenters: Must report OON services to the DFPS caseworker within 10 business days.
- DFPS/MCO Data Integration: DFPS is required to update the child's "Health Passport" upon receipt of notice. MCO IT systems must be configured to ingest these non-claims-based clinical records to prevent duplicate testing or dangerous drug interactions.
- Billing Firewalls: OON Providers must tag these patient profiles as "Do Not Bill Medicaid." Inadvertent submission of these claims to STAR Health will result in denials and potential audit flags.
Fees & Costs
- State Liability: DFPS and MCOs are statutorily absolved of financial liability for services procured under this section.
- Cost Allocation: All costs for OON services fall strictly on the medical consenter or their private commercial insurance.
Strategic Ambiguities & Considerations
- Definition of "Adverse Action": The statute prohibits MCOs from penalizing recipients but does not define the scope. It is unclear if adjusting risk scores or reducing case management fees based on "missing" network care constitutes an adverse action. Watch HHSC rulemaking for definitions.
- Pharmacy Exclusion: The authorization applies to "medical care." Pharmacies are generally distinct in Texas code. If a doctor prescribes medication, the consenter may still be required to utilize the Medicaid formulary and network pharmacies, or pay cash without the protections afforded to the medical visit.
- Data Latency: There is a statutory gap between the care provided and the update to the Health Passport (10 days + processing time). Providers should be wary of prescribing medication during this window without a complete medication history.
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JD Key Consulting specializes in Texas regulatory compliance strategy. Work directly with James Dickey—former Chairman of the Republican Party of Texas—to understand this bill's impact on your operations and develop an actionable compliance plan.
Schedule a ConsultationInformation presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.
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Legislative Timeline
This bill's path through the Texas Legislature
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Senate Authors
Coauthors (2)
Fiscal NoteView Original
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Related by Topic
- SB513Relating to a rural community-based care pilot program.
- HB18Relating to the establishment and administration of certain programs and services providing health care services to rural counties.
- HB3940Relating to the provision of certain information about Medicaid benefits in relation to newborn children.
- HB426Relating to Medicaid and child health plan program coverage and reimbursement for childhood cranial remolding orthosis.
- HB2789Relating to the regulation of child welfare, including licensure, community-based care contractors, family homes, and child-care facilities.
Quick Reference
Frequently Asked Questions
Common questions about SB855
Q
Who authored SB855?
SB855 was authored by Texas Senator Kevin Sparks during the Regular Session.
Q
When was SB855 signed into law?
SB855 was signed into law by Governor Greg Abbott on May 21, 2025.
Q
Which agencies enforce SB855?
SB855 is enforced by Department of Family and Protective Services (DFPS) and Health and Human Services Commission (HHSC).
Q
How significant are the changes in SB855?
The regulatory priority for SB855 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.
Q
What is the cost impact of SB855?
The cost impact of SB855 is estimated as "low". This may vary based on industry and implementation requirements.
Q
What topics does SB855 address?
SB855 addresses topics including health care providers, health, health--children's insurance, human services and human services--child services.
Q
What are the key dates for SB855?
Key dates for SB855: Effective date is 2025-09-01. Rulemaking: Must prescribe the 'form and manner' for medical consenters to notify caseworkers of out-of-network care. (2025-09-01); Must amend STAR Health program managed care contracts to prohibit adverse actions against recipients accessing self-funded out-of-network care. (2025-09-01). Consult with legal counsel regarding applicability.
Q
Which Texas businesses are affected by SB855?
SB855 primarily affects healthcare providers and medical facilities, insurance companies and financial institutions. These businesses should review the legislation with their legal and compliance teams to understand potential impacts.
Need Strategic Guidance on This Legislation?
JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.
Legislative data provided by LegiScanLast updated: January 11, 2026