By:  Harris, Chris                                     S.B. No. 206
       73R2135 DLF-D
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to claims, review of claims, and fraudulent claims for
    1-3  benefits for certain health care and mental health care services
    1-4  covered by insurance; imposing civil penalties.
    1-5        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-6        SECTION 1.  Subchapter C, Chapter 21, Insurance Code, is
    1-7  amended by adding Article 21.24-2 to read as follows:
    1-8        Art. 21.24-2.  SETTLEMENT OF CLAIMS FOR HEALTH CARE SERVICES
    1-9        Sec. 1.  DEFINITIONS.  In this article:
   1-10              (1)  "Health care provider" means a person providing
   1-11  health care services who is eligible for reimbursement for those
   1-12  services from an insurer.
   1-13              (2)  "Insured" means the policyholder in the case of an
   1-14  individual policy of insurance and the certificate holder in the
   1-15  case of a group policy of insurance.
   1-16              (3)  "Insurer" means a person who writes an individual
   1-17  or group policy of insurance that is delivered, issued for
   1-18  delivery, or renewed in this state and that provides coverage for
   1-19  medical or surgical expenses incurred as a result of accident or
   1-20  sickness, including a company subject to Chapter 20 of this code.
   1-21        Sec. 2.  NOTICE OF AMOUNT PAID.  An insurer shall notify the
   1-22  insured in writing of the amount actually paid by the insurer for
   1-23  health care services provided under the insured's coverage.
   1-24        Sec. 3.  ADJUSTMENT OF DEDUCTIBLE OR COPAYMENT.  If an
    2-1  insured pays a deductible or copayment for health care services and
    2-2  the amount actually paid by the insurer for those services is
    2-3  adjusted, the insurer shall refund to the insured any amount of the
    2-4  deductible or copayment paid by the insured in excess of the amount
    2-5  required to be paid under the policy for those services.
    2-6        SECTION 2.  Article 21.58A, Insurance Code, is amended by
    2-7  adding Section 8A to read as follows:
    2-8        Sec. 8A.  AUDIT OF HOSPITAL.  (a)  If a utilization review
    2-9  agent conducts an audit of hospital billings in conjunction with a
   2-10  utilization review, the agent shall report any adverse results of
   2-11  the audit to the state agency that licenses the hospital.
   2-12        (b)  The department shall adopt criteria for reports made
   2-13  under this section, including criteria to determine whether a
   2-14  report of adverse results of an audit must be made, in consultation
   2-15  with the Texas Department of Health, the Texas Department of Mental
   2-16  Health and Mental Retardation, and the Texas Commission on Alcohol
   2-17  and Drug Abuse.
   2-18        SECTION 3.  Section 9, Article 21.58A, Insurance Code, is
   2-19  amended to read as follows:
   2-20        Sec. 9.  VIOLATIONS.  <(a)  If the commissioner believes that
   2-21  a utilization review agent has violated or is violating this
   2-22  article, the commissioner shall notify the utilization review agent
   2-23  of the alleged violation and may compel the production of any and
   2-24  all documents or other information as provided by this code.>
   2-25        <(b)  The commissioner may initiate the proceedings under
   2-26  this section after the 30th day after the date the commissioner
   2-27  notifies the agent as required by Subsection (a) of this section.>
    3-1        <(c)  Proceedings under this article are a contested case for
    3-2  the purposes of the administrative procedure act.>
    3-3        <(d)>  If a <after notice and hearing the commissioner
    3-4  determines that the> utilization review agent has violated or is
    3-5  violating any provision of this article, the commissioner may<:>
    3-6              <(1)>  impose sanctions under Section 7, Article 1.10
    3-7  of this code<;> or
    3-8              <(2)  issue a cease and desist order> under Article
    3-9  1.10A of this code.
   3-10        SECTION 4.  Section 11, Article 21.58A, Insurance Code, is
   3-11  amended by adding Subsection (c) to read as follows:
   3-12        (c)  The board shall adopt rules governing the review, after
   3-13  a health care service has been provided to an enrollee, of the
   3-14  necessity and appropriateness of that service.
   3-15        SECTION 5.  Article 21.58A, Insurance Code, is amended by
   3-16  adding Sections 12A and 13A to read as follows:
   3-17        Sec. 12A.  PAYMENT OF UTILIZATION REVIEW AGENTS.  A
   3-18  utilization review agent may not accept compensation for conducting
   3-19  a utilization review if the compensation is based on:
   3-20              (1)  payments not made or reduced as a result of a
   3-21  utilization review;
   3-22              (2)  promises by the utilization review agent to reduce
   3-23  health care costs by specified amounts or percentages; or
   3-24              (3)  a business or utilization plan that establishes a
   3-25  target for overall cost reductions to result from utilization
   3-26  reviews.
   3-27        Sec. 13A.  REPORTING OF INFORMATION RELATING TO PATIENT CARE;
    4-1  IMMUNITY.  (a)  For the purpose of this section, "quality assurance
    4-2  entity" means any person, committee, division, department, or other
    4-3  entity responsible for quality assurance or peer review of services
    4-4  provided by a health care provider.
    4-5        (b)  A utilization review agent may report to a quality
    4-6  assurance entity information gathered by the utilization review
    4-7  agent that relates to a specific patient and that is relevant to
    4-8  the quality of care received by the patient.  The utilization
    4-9  review agent may require that the quality assurance entity ensure
   4-10  compliance with confidentiality requirements imposed by law,
   4-11  including the requirements of Sections 161.032 and 611.002, Health
   4-12  and Safety Code, and Section 5.06, Medical Practice Act (Article
   4-13  4495b, Vernon's Texas Civil Statutes).
   4-14        (c)  Information provided by a utilization review agent to a
   4-15  peer review committee under Section 5.06, Medical Practice Act
   4-16  (Article 4495b, Vernon's Texas Civil Statutes), is subject to the
   4-17  confidentiality requirements of that section.
   4-18        (d)  Except as provided by Section 5.06, Medical Practice Act
   4-19  (Article 4495b, Vernon's Texas Civil Statutes), a utilization
   4-20  review agent is not subject to liability for providing information
   4-21  to a quality assurance entity.
   4-22        SECTION 6.  Section 2, Article 1.10A, Insurance Code, is
   4-23  amended to read as follows:
   4-24        Sec. 2.  Authority To Issue Order.  The commissioner may
   4-25  issue an emergency cease and desist order, ex parte, if:
   4-26              (1)  the commissioner believes:
   4-27                    (A)  an authorized person engaging in the
    5-1  business of insurance is committing an unfair method of competition
    5-2  or an unfair or deceptive act or practice in violation of Article
    5-3  21.21 or Article 21.21-2 of this code or in violation of a rule or
    5-4  regulation promulgated under Article 21.21 or Article 21.21-2 of
    5-5  this code;
    5-6                    (B)  an unauthorized person is engaging in the
    5-7  business of insurance in violation of Article 1.14-1 of this code
    5-8  or in violation of a rule or regulation promulgated under Article
    5-9  1.14-1 of this code;
   5-10                    (C)  an unauthorized person engaged in the
   5-11  business of insurance acting in violation of Article 1.14-1 of this
   5-12  code is committing an unfair method of competition or an unfair or
   5-13  deceptive act or practice in violation of Article 21.21 or Article
   5-14  21.21-2 of this code or in violation of any rule or regulation
   5-15  promulgated under Article 21.21 or Article 21.21-2 of this code;
   5-16  <or>
   5-17                    (D)  an authorized person engaging in the
   5-18  business of insurance is determined by the commissioner to be in a
   5-19  hazardous condition or a hazardous financial condition under
   5-20  Article 1.32 or Article 20A.19 of this code; or
   5-21                    (E)  a person is violating Article 21.58A of this
   5-22  code or a rule adopted under Article 21.58A of this code; and
   5-23              (2)  it appears to the commissioner that the alleged
   5-24  conduct is fraudulent or hazardous or creates an immediate danger
   5-25  to the public safety or is causing or can be reasonably expected to
   5-26  cause significant, imminent, and irreparable public injury.
   5-27        SECTION 7.  Subchapter E, Chapter 21, Insurance Code, is
    6-1  amended by adding Articles 21.58C and 21.58D to read as follows:
    6-2        Art. 21.58C.  DEPARTMENT REVIEW OF MENTAL HEALTH BENEFITS
    6-3  CLAIMS
    6-4        Sec. 1.  DEFINITIONS.  In this article:
    6-5              (1)  "Insured" means a person who makes a mental health
    6-6  benefits claim.
    6-7              (2)  "Insurer" means an insurer that writes an
    6-8  individual or group policy of insurance that is delivered, issued
    6-9  for delivery, or renewed in this state, including a company subject
   6-10  to Chapter 20, Insurance Code, and a health maintenance
   6-11  organization subject to the Texas Health Maintenance Organization
   6-12  Act (Chapter 20A, Vernon's Texas Insurance Code).
   6-13              (3)  "Mental health benefits claim" means a claim made
   6-14  under an insurance policy for benefits for the treatment of a
   6-15  mental or emotional disorder, including a serious mental illness as
   6-16  defined by Section 3.51-14 of this code.
   6-17              (4)  "Mental health benefits invoice" means an invoice
   6-18  for goods or services provided to an insured for the treatment of a
   6-19  mental or emotional disorder, including a serious mental illness as
   6-20  defined by Section 3.51-14 of this code.  The term includes an
   6-21  invoice that is provided to an assignee of the insured.
   6-22        Sec. 2.  CLAIM REVIEW.  (a)  On request and in accordance
   6-23  with this section, the department may review a mental health
   6-24  benefits invoice.
   6-25        (b)  Not later than the 30th day after the date an insured
   6-26  notifies an insurer of a mental health benefits claim, the insurer
   6-27  may request that the department conduct a review of the invoice
    7-1  under this section.  The department shall adopt rules establishing
    7-2  criteria for when review may be requested by an insurer under this
    7-3  subsection and what documentation the insurer must provide in
    7-4  connection with the request to demonstrate that those criteria have
    7-5  been satisfied.
    7-6        (c)  Not later than the 30th day after the date the insurer
    7-7  notifies an insured that the insurer has denied all or part of a
    7-8  mental health benefits claim, the insured may request that the
    7-9  department conduct a review of the invoice under this section.
   7-10  This subsection does not apply to an invoice for which the insurer
   7-11  has requested a review under Subsection (b) of this section.
   7-12        (d)  Not later than the 30th day after the date the
   7-13  department receives a request from an insured under Subsection (c)
   7-14  of this section, the department shall mail a notice to the affected
   7-15  insurer, advising the insurer of the request.
   7-16        (e)  The department may report a person to the Texas
   7-17  Department of Mental Health and Mental Retardation or other
   7-18  appropriate state agency if the department finds, as a result of a
   7-19  review conducted under this section, that the person participated
   7-20  in the issuance of a mental health benefits invoice that:
   7-21              (1)  does not accurately reflect the services or
   7-22  products provided;
   7-23              (2)  includes a service or product that should not have
   7-24  been provided; or
   7-25              (3)  includes an unreasonable charge for a service or
   7-26  product.
   7-27        (f)  The board shall adopt rules governing hearings and
    8-1  reviews conducted under this article.
    8-2        (g)  This section does not limit the right of an insured to
    8-3  bring an action in a court to enforce the insured's rights against
    8-4  an insurer.  An insured is not required to request review under
    8-5  this article before bringing an action in court.  Regardless of
    8-6  whether a review has been conducted under Subsection (c) of this
    8-7  section, the insured is entitled to trial de novo with respect to
    8-8  any matter that was the subject of the review.
    8-9        Art. 21.58D.  Insurer Investigation of Health Benefits Claims
   8-10        Sec. 1.  Definitions.  In this article:
   8-11              (1)  "Health benefits claim" means a claim made under
   8-12  an insurance policy for benefits for the treatment of an illness or
   8-13  injury, including a serious mental illness as defined by Section
   8-14  3.51-14 of this code or any other mental or emotional disorder.
   8-15              (2)  "Health benefits invoice" means an invoice for
   8-16  goods or services provided to an insured for the treatment of an
   8-17  illness or injury, including a mental or emotional disorder.  The
   8-18  term includes an invoice that is provided to an assignee of the
   8-19  insured.
   8-20              (3)  "Insured" means a person making a health benefits
   8-21  claim under an insurance policy.
   8-22              (4)  "Insurer" means an insurer that writes an
   8-23  individual or group policy of insurance that is delivered, issued
   8-24  for delivery, or renewed in this state, including a company subject
   8-25  to Chapter 20, Insurance Code, and a health maintenance
   8-26  organization subject to the Texas Health Maintenance Organization
   8-27  Act (Chapter 20A, Vernon's Texas Insurance Code).
    9-1        Sec. 2.  Investigation.  (a)  An insurer shall investigate a
    9-2  claim submitted to the insurer if the insured requests an
    9-3  investigation under this section.
    9-4        (b)  An insured may request that the insurer investigate
    9-5  whether the health benefits invoice on which the claim is based:
    9-6              (1)  accurately reflects the services or products
    9-7  provided;
    9-8              (2)  includes a service or product that should not have
    9-9  been provided; or
   9-10              (3)  includes an unreasonable charge for a service or
   9-11  product.
   9-12        (c)  The insured must make the request for investigation not
   9-13  later than the 30th day after the date on which the insured mailed
   9-14  or delivered the claim to the insurer.
   9-15        (d)  The insurer shall report the results of the
   9-16  investigation to the insured, the department, and to the Texas
   9-17  Department of Health, Texas Department of Mental Health and Mental
   9-18  Retardation, or other appropriate state agency.
   9-19        Sec. 3.  NOTIFICATION OF RIGHT TO INVESTIGATION.  (a)  Each
   9-20  individual policy of insurance, certificate evidencing coverage
   9-21  under a group policy of insurance, and evidence of coverage issued
   9-22  by a health maintenance organization that is delivered, issued for
   9-23  delivery, or renewed by an insurer in this state must include a
   9-24  statement of an insured's right to an investigation under this
   9-25  article.
   9-26        (b)  The board shall adopt rules governing the form and
   9-27  content of the statement included in the policy, certificate, or
   10-1  evidence of coverage under this article.
   10-2        SECTION 8.  Subchapter E, Chapter 21, Insurance Code, is
   10-3  amended by adding Articles 21.79, 21.79A, 21.79A-1, and 21.79A-2 to
   10-4  read as follows:
   10-5        Art. 21.79.  CIVIL ACTIONS FOR INSURANCE CLAIM FRAUD
   10-6        Sec. 1.  DEFINITION.  For purposes of this article, "health
   10-7  care practitioner" means a person who renders or causes to be
   10-8  rendered health care or mental health care services and who is
   10-9  entitled to payment under a health insurance policy and includes
  10-10  any person who may be selected by an insured or beneficiary under
  10-11  Article 21.52 of this code.  The term also includes a person who is
  10-12  an officer, employee, or agent of an organization that renders
  10-13  health care or mental health care services.
  10-14        Sec. 2.  CAUSES OF ACTION.  (a)  A person who is injured by
  10-15  an act of fraud in connection with an insurance claim may bring an
  10-16  action in a court of competent jurisdiction for damages and may
  10-17  petition the court to restrain further attempts to make an improper
  10-18  claim for payment.
  10-19        (b)  A person who has received medical treatment wrongfully
  10-20  or unnecessarily at the direction of a health care practitioner may
  10-21  bring an action in a court of competent jurisdiction for damages or
  10-22  to enjoin further wrongful acts.
  10-23        Sec. 3.  DAMAGES.  (a)  In an action filed under this
  10-24  article, the court may grant a successful claimant:
  10-25              (1)  compensatory damages, plus all reasonable
  10-26  investigation and litigation expenses, including attorney's fees;
  10-27              (2)  an order restraining the respondent from engaging
   11-1  in further attempts to make an improper claim for payment;
   11-2              (3)  damages in accordance with Subsection (b) of this
   11-3  section; and
   11-4              (4)  any other relief the court finds proper.
   11-5        (b)  If the court finds that the respondent has engaged in a
   11-6  pattern of committing fraud in connection with insurance claims,
   11-7  the court may award the claimant two times the amount of
   11-8  compensatory damages awarded under Subsection (a)(1) of this
   11-9  section.  An award of damages under this subsection is in addition
  11-10  to an award of damages under Subsection (a)(1) of this section.
  11-11        Sec. 4.  LIMITATIONS.  (a)  Notwithstanding Section 16.003,
  11-12  Civil Practice and Remedies Code, a person must bring suit under
  11-13  this article on or before the later of:
  11-14              (1)  four years after the date the fraud occurred; or
  11-15              (2)  four years after the date the person, in the
  11-16  exercise of reasonable diligence, should have discovered the
  11-17  occurrence of the fraud.
  11-18        (b)  The limitations period in this section does not include
  11-19  any period during which the person bringing the action reasonably
  11-20  believes that the department or another authorized governmental
  11-21  agency is conducting a criminal investigation or prosecution of the
  11-22  defendant for fraud.
  11-23        Sec. 5.  NOTICE TO APPROPRIATE AGENCY.  (a)  Not later than
  11-24  the 31st day after a verdict is entered holding a health care
  11-25  practitioner liable for damages under this article, the clerk of
  11-26  the court in  which the verdict is rendered shall prepare and send
  11-27  to the licensing authority with jurisdiction over the practitioner
   12-1  a certified abstract of the court's record regarding the case.
   12-2        (b)  On receipt of the abstract of the record, the licensing
   12-3  authority shall consider disciplinary action against the health
   12-4  care practitioner in accordance with the procedures used by that
   12-5  licensing authority.
   12-6        Art. 21.79A.  HEALTH CARE INSURANCE CLAIM FRAUD; NOTIFICATION
   12-7  OF LICENSING AUTHORITY.  (a)  For purposes of this article, "health
   12-8  care practitioner" means a person who renders or causes to be
   12-9  rendered health care or mental health care services and who is
  12-10  entitled to payment under a health insurance policy.  The term
  12-11  includes:
  12-12              (1)  any person who may be selected by an insured or
  12-13  beneficiary under Article 21.52 of this code; and
  12-14              (2)  an officer, employee, or agent of an organization
  12-15  that renders health care or mental health care services.
  12-16        (b)  If the department knows that a health care practitioner
  12-17  has been convicted of fraud in connection with an insurance claim,
  12-18  the department shall notify the licensing authority with
  12-19  jurisdiction over the practitioner of the conviction.
  12-20        (c)  On receipt of notification under Subsection (b) of this
  12-21  article, the licensing authority shall consider disciplinary action
  12-22  against the health care practitioner in accordance with the
  12-23  procedures used by that licensing authority.
  12-24        (d)  The department shall cooperate with the licensing
  12-25  authority and shall provide any necessary and relevant testimony,
  12-26  documents, or other evidence in the possession of the department.
  12-27        Art. 21.79A-1.  HEALTH CARE INSURANCE CLAIM FRAUD; REPORT OF
   13-1  OUT-OF-STATE CONVICTION.  (a)  For purposes of this article,
   13-2  "health care practitioner" means a person who renders or causes to
   13-3  be rendered health care or mental health care services and who is
   13-4  entitled to payment under a health insurance policy.  The term
   13-5  includes:
   13-6              (1)  any person who may be selected by an insured or
   13-7  beneficiary under Article 21.52 of this code; and
   13-8              (2)  an officer, employee, or agent of an organization
   13-9  that renders health care or mental health care services.
  13-10        (b)  If a health care practitioner rendering health care or
  13-11  mental health care services in this state is convicted of fraud on
  13-12  an insurer in another state, the practitioner shall report the
  13-13  conviction in writing to the commissioner.
  13-14        (c)  A health care practitioner who does not report a
  13-15  conviction in accordance with Subsection (b) of this article may be
  13-16  disciplined in accordance with the procedures of the licensing
  13-17  authority with jurisdiction over the practitioner.
  13-18        Art. 21.79A-2.  HEALTH CARE INSURANCE CLAIM FRAUD; HEALTH
  13-19  CARE PRACTITIONER COOPERATION IN INVESTIGATION.  (a)  In this
  13-20  article:
  13-21              (1)  "Health benefits claim" means a claim made under
  13-22  an insurance policy for benefits for the treatment of an illness or
  13-23  injury, including a mental or emotional disorder.
  13-24              (2)  "Health benefits claim investigation" means an
  13-25  investigation of a health benefits claim conducted by:
  13-26                    (A)  a law enforcement agency of this state;
  13-27                    (B)  an insurer;
   14-1                    (C)  the insurance fraud unit created under
   14-2  Article 1.10D of this code; or
   14-3                    (D)  a state or federal governmental agency or a
   14-4  nongovernmental agency established to detect and prevent fraudulent
   14-5  insurance acts or to regulate the business of insurance.
   14-6              (3)  "Health care practitioner" means a person who
   14-7  renders or causes to be rendered health care or mental health care
   14-8  services and who is entitled to payment under a health insurance
   14-9  policy.  The term includes:
  14-10                    (A)  any person who may be selected by an insured
  14-11  or beneficiary under Article 21.52 of this code; and
  14-12                    (B)  an officer, employee, or agent of an
  14-13  organization that renders health care or mental health care
  14-14  services.
  14-15              (4)  "Investigating agency" means the person conducting
  14-16  the health benefits claim investigation.
  14-17        (b)  Not later than the 31st day after the date on which a
  14-18  health care practitioner receives a request for information from an
  14-19  investigating agency that relates to a health benefits claim
  14-20  investigation, the health care practitioner shall provide the
  14-21  information to the agency.
  14-22        (c)  If the health care practitioner does not provide the
  14-23  requested information within the time specified by Subsection (b)
  14-24  of this article, a court of this state, on the petition of the
  14-25  investigating agency, shall order the health care practitioner to
  14-26  provide the information unless the health care practitioner
  14-27  demonstrates that the information is not available or that the
   15-1  information may not be released under state or federal law.
   15-2        (d)  A court issuing an order under Subsection (c) of this
   15-3  article also shall order the health care practitioner to pay
   15-4  reasonable attorney's fees and costs incurred by the investigating
   15-5  agency in obtaining the order.  The order may include appropriate
   15-6  limits on the distribution of confidential communications.
   15-7        (e)  If the health benefits claim is the subject of a
   15-8  criminal or civil court proceeding at the time a court order is
   15-9  sought under Subsection (c) of this article, the petition for an
  15-10  order under Subsection (c) of this article must be made in the
  15-11  court in which the claim is pending.
  15-12        SECTION 9.  Section 2(e), Article 1.10D, Insurance Code, is
  15-13  amended to read as follows:
  15-14        (e)  This section does  not prohibit or limit the authority
  15-15  of an insurer to conduct its own independent investigation into a
  15-16  suspected case of insurance claim fraud.  Before an insurer may
  15-17  request the commissioner to conduct an investigation of suspected
  15-18  claim fraud, the insurer must have completed its investigation and
  15-19  drafted a report of its findings.  The insurer shall submit the
  15-20  report and the related investigation file to the commissioner as
  15-21  part of the insurer's request for investigation by the
  15-22  commissioner.  The commissioner may undertake an investigation
  15-23  against a policyholder or claimant only if:
  15-24              (1)  <In regard to an insurer's request for
  15-25  investigation under this subsection, the commissioner's authority
  15-26  to undertake an investigation against a policyholder or claimant is
  15-27  limited to those instances in which> the insurer's investigation
   16-1  reports show a pattern of fraudulent activity; or
   16-2              (2)  the total amount of allegedly fraudulent claims is
   16-3  at least $25,000.
   16-4        SECTION 10.  Section 5, Article 1.10D, Insurance Code, is
   16-5  amended by adding Subsection (d) to read as follows:
   16-6        (d)  The insurance fraud unit may provide information or
   16-7  material that is relevant to an inquiry into claim fraud to an
   16-8  insurance industry-sponsored fraud investigation unit if the
   16-9  commissioner determines that providing the information or material
  16-10  would prevent further fraud or otherwise serve the public interest
  16-11  and that the interests of the department and of the insurance
  16-12  industry-sponsored fraud investigation unit are substantially
  16-13  similar with respect to the subject of the investigation.  An
  16-14  insurance industry-sponsored fraud investigation unit that has
  16-15  received information or material under this subsection may not
  16-16  release the information or material to a person other than an
  16-17  authorized governmental entity.  Providing information or material
  16-18  under this subsection is not a waiver of confidentiality by the
  16-19  department under any part of this code.  The department is not
  16-20  subject to liability for providing information or material to an
  16-21  insurance industry-sponsored fraud investigation unit.
  16-22        SECTION 11.  Section 6(a), Article 1.10D, Insurance Code, is
  16-23  amended to read as follows:
  16-24        (a)  A person acting without malice, fraudulent intent, or
  16-25  bad faith is not subject to liability based on filing reports or
  16-26  furnishing, orally or in writing, other information concerning
  16-27  suspected, anticipated, or completed fraudulent insurance acts if
   17-1  the reports or information are provided to:
   17-2              (1)  a law enforcement officer or an agent or employee
   17-3  of a law enforcement officer;
   17-4              (2)  the National Association of Insurance
   17-5  Commissioners, a state or federal governmental agency or
   17-6  nongovernmental agency or association established to detect and
   17-7  prevent fraudulent insurance acts or to regulate the business of
   17-8  insurance, or an employee of that association or <governmental>
   17-9  agency; <or>
  17-10              (3)  an insurer or an agent or an employee of an
  17-11  insurer; or
  17-12              (4)  an authorized governmental agency or the
  17-13  department.
  17-14        SECTION 12.  Section 6, Article 1.10D, Insurance Code, is
  17-15  amended by adding Subsection (e) to read as follows:
  17-16        (e)  In an action brought against a person for filing a
  17-17  report or furnishing other information concerning a fraudulent
  17-18  insurance act, the party bringing the action must specifically
  17-19  plead any allegation that Subsection (a) of this section is
  17-20  inapplicable because the person that filed the report or furnished
  17-21  the information acted with malice, fraudulent intent, or bad faith.
  17-22        SECTION 13.  (a)  Article 21.24-2, Insurance Code, as added
  17-23  by this Act, applies only to amounts paid by an insurer for health
  17-24  care services rendered on or after the effective date of this Act.
  17-25  Amounts paid by the insurer for health care services rendered
  17-26  before the effective date of this Act are governed by the law in
  17-27  effect at the time the amounts were paid, and that law is continued
   18-1  in effect for that purpose.
   18-2        (b)  Section 9, Article 21.58A, Insurance Code, as amended by
   18-3  this Act, applies only to a violation of Article 21.58A that occurs
   18-4  on or after the effective date of this Act.  A violation of Article
   18-5  21.58A, Insurance Code, that occurs before the effective date of
   18-6  this Act is governed by the law in effect at the time the violation
   18-7  occurs, and that law is continued in effect for that purpose.
   18-8        (c)  The State Board of Insurance may not adopt rules under
   18-9  Section 11(c), Article 21.58A, Insurance Code, as added by this
  18-10  Act, until the board has reported to the 73rd Legislature the
  18-11  findings and recommendations of the study conducted by the board in
  18-12  accordance with Section 11.03(b), Chapter 242, Acts of the 72nd
  18-13  Legislature, Regular Session, 1991.
  18-14        (d)  Article 21.58C, Insurance Code, as added by this Act,
  18-15  applies only to a mental health benefits claim received by an
  18-16  insurer on or after the effective date of this Act.  A mental
  18-17  health benefits claim received before the effective date of this
  18-18  Act is governed by the law in effect at the time the claim was
  18-19  received, and that law is continued in effect for that purpose.
  18-20        (e)  Article 21.58D, Insurance Code, as added by this Act,
  18-21  applies only to a health benefits claim received by an insurer on
  18-22  or after the effective date of this Act.  A health benefits claim
  18-23  received before the effective date of this Act is governed by the
  18-24  law in effect at the time the claim was received, and that law is
  18-25  continued in effect for that purpose.
  18-26        (f)  Article 21.79, Insurance Code, as added by this Act,
  18-27  applies only to a cause of action that accrues on or after the
   19-1  effective date of this Act.  An action that accrued before the
   19-2  effective date of this Act is governed by the law in effect at the
   19-3  time the action accrued, and the former law is continued in effect
   19-4  for that purpose.
   19-5        (g)  Article 21.79A-1, Insurance Code, as added by this Act,
   19-6  applies to a conviction for fraud on an insurer in another state
   19-7  that occurred before, on, or after the effective date of this Act.
   19-8        (h)  Section 6(e), Article 1.10D, Insurance Code, as added by
   19-9  this Act, applies only to a pleading filed on or after the
  19-10  effective date of this Act.  A pleading filed before the effective
  19-11  date of this Act is governed by the law in effect at the time the
  19-12  pleading was filed, and that law is continued in effect for that
  19-13  purpose.
  19-14        SECTION 14.  This Act takes effect September 1, 1993.
  19-15        SECTION 15.  The importance of this legislation and the
  19-16  crowded condition of the calendars in both houses create an
  19-17  emergency   and   an   imperative   public   necessity   that   the
  19-18  constitutional rule requiring bills to be read on three several
  19-19  days in each house be suspended, and this rule is hereby suspended.