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A BILL TO BE ENTITLED
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AN ACT
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relating to the use of extrapolation by a health maintenance |
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organization or an insurer to audit claims. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 843.010, Insurance Code, as effective |
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April 1, 2025, is amended to read as follows: |
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Sec. 843.010. APPLICABILITY OF CERTAIN PROVISIONS TO |
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GOVERNMENTAL HEALTH BENEFIT PLANS. Sections 843.306(f), 843.322, |
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and 843.363(a)(4) do not apply to coverage under: |
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(1) the child health plan program under Chapter 62, |
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Health and Safety Code, or the health benefits plan for children |
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under Chapter 63, Health and Safety Code; or |
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(2) a Medicaid program, including a Medicaid managed |
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care program operated under Chapter 540 or 540A, Government Code, |
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as applicable. |
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SECTION 2. Subchapter I, Chapter 843, Insurance Code, is |
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amended by adding Section 843.322 to read as follows: |
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Sec. 843.322. USE OF EXTRAPOLATION PROHIBITED. (a) In this |
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section, "extrapolation" means a mathematical process or technique |
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used by a health maintenance organization in the audit of a |
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participating physician or provider to estimate audit results or |
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findings for a larger batch or group of claims not reviewed by the |
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health maintenance organization. |
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(b) A health maintenance organization may not use |
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extrapolation to complete an audit of a participating physician or |
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provider. Any additional payment due a participating physician or |
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provider or any refund due the health maintenance organization must |
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be based on the actual overpayment or underpayment and may not be |
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based on an extrapolation. |
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SECTION 3. Subchapter B, Chapter 1301, Insurance Code, is |
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amended by adding Section 1301.0643 to read as follows: |
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Sec. 1301.0643. USE OF EXTRAPOLATION PROHIBITED. (a) In |
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this section, "extrapolation" means a mathematical process or |
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technique used by an insurer in the audit of a preferred provider to |
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estimate audit results or findings for a larger batch or group of |
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claims not reviewed by the insurer. |
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(b) An insurer may not use extrapolation to complete an |
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audit of a preferred provider. Any additional payment due a |
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preferred provider or any refund due the insurer must be based on |
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the actual overpayment or underpayment and may not be based on an |
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extrapolation. |
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SECTION 4. The change in law made by this Act applies only |
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to the audit of a physician or provider under a contract with an |
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insurer or health maintenance organization entered into or renewed |
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on or after the effective date of this Act. |
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SECTION 5. This Act takes effect September 1, 2025. |