(a) This subchapter applies to health care services and assistance provided to a person who resides in the service area of a public hospital or hospital district.
(b) For the purposes of this subchapter, a hospital is not considered to be a public hospital and is not responsible for providing care under this subchapter if the hospital:
(1) is owned, operated, or leased by a municipality with a population of less than 5,500;
(2) was leased before January 1, 1981, by a municipality that at the time of the lease did not have a legal obligation to provide indigent health care; or
(3) was established under Section 265.031.