By Counts H.B. No. 1414
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to provisions governing insurance fraud, creating a penal
1-3 offense; and making an appropriation.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Title 7, Penal Code, is amended by the addition
1-6 of Chapter 35, which reads as follows:
1-7 CHAPTER 35. INSURANCE FRAUD.
1-8 Sec. 35.01. DEFINITIONS. In this chapter:
1-9 (1) "Insurer" means any person or government who does
1-10 business as an insurer in this state, including an insurer that is
1-11 not authorized to do business in this state. The term includes a
1-12 health maintenance organization, a company subject to Chapter 20,
1-13 Insurance Code, and an organization that is self-insured and that
1-14 provides health care benefits to its employees.
1-15 (2) "Statement" means any oral or written
1-16 communication, or any record or documented representation of fact
1-17 evidencing a loss, injury or expense. A statement may be
1-18 computer-generated.
1-19 (3) "Health care provider" means a person who renders
1-20 or causes to be rendered health care services or an agent or
1-21 employee of an organization that renders or provides the facility
1-22 and means to render health care services, and includes whether
1-23 licensed or unlicensed: physicians, surgeons, persons who may be
2-1 selected by an insured or a beneficiary under Article 21.52,
2-2 Insurance Code, and persons defined as a provider of health care
2-3 under Article 4495b, Subchapter A, Section 2.05(d)(1), Texas
2-4 Medical Practice Act.
2-5 (4) "Health care services" includes all services
2-6 intended to improve or maintain the physical or mental condition of
2-7 an individual rendered, directed or supervised by a health care
2-8 provider.
2-9 (5) "Health care goods" means any tangible product,
2-10 device, medicine or other object, whether provided permanently or
2-11 temporarily in conjunction with a health care service.
2-12 Sec. 35.02. INSURANCE FRAUD. (a) A person commits an
2-13 offense if the person, with intent to defraud or deceive an
2-14 insurer, causes to be prepared or presents to an insurer in support
2-15 of a claim for payment under a health or property insurance policy
2-16 a statement that the person knows:
2-17 (1) contains false or misleading information
2-18 concerning a matter that is material to the claim; or
2-19 (2) conceals or fails to disclose a material fact that
2-20 affects:
2-21 (A) a person's right to a payment;
2-22 (B) the amount of payment to which a person is
2-23 entitled.
2-24 (b) A person commits an offense if the person, with intent
2-25 to defraud and deceive an insurer, solicits, offers, pays or
3-1 receives a benefit in connection with the furnishing of health care
3-2 goods or services for which payment is sought under an insurance
3-3 policy.
3-4 (c) For purposes of Subsection (a) of this chapter,
3-5 information concerning a matter that is material to a claim for
3-6 payment under an insurance policy includes information concerning:
3-7 (1) whether health care goods or services were
3-8 provided;
3-9 (2) whether health care goods or services were
3-10 medically necessary under professionally accepted standards;
3-11 (3) the nature of the health care goods or services
3-12 provided;
3-13 (4) the date on which health care goods or services
3-14 were provided;
3-15 (5) the medical record of goods or services provided;
3-16 (6) the condition treated or diagnosis made;
3-17 (7) the identity and applicable license of the
3-18 provider or the recipient of health care goods or services;
3-19 (8) whether property was damaged or lost in the manner
3-20 and under the circumstances described in a statement related to a
3-21 claim for insurance payment; or
3-22 (9) whether any other claim for insurance payment has
3-23 been communicated to any other insurer concerning property damage
3-24 or loss to the same property.
3-25 (d) Except as provided by Subsection (e) of this section, an
4-1 offense under this section is:
4-2 (1) a Class C misdemeanor if the value of the claim is
4-3 less than $20; or
4-4 (2) a Class B misdemeanor if:
4-5 (A) the value of the claim is $20 or more but
4-6 less than $500; or
4-7 (B) the value of the claim is less than $20 and
4-8 the actor has been previously convicted of a misdemeanor under this
4-9 chapter;
4-10 (3) a Class A misdemeanor if the value of the claim is
4-11 $500 or more but less than $1,500;
4-12 (4) a state jail felony if:
4-13 (A) the value of the claim is $1,500 or more but
4-14 less than $20,000; or
4-15 (B) the value of the claim is less than $1,500
4-16 and the actor has been previously convicted of a misdemeanor two or
4-17 more times under this chapter;
4-18 (5) a felony of the third degree if the value of the
4-19 claim is $20,000 or more but less than $100,000;
4-20 (6) a felony of the second degree if:
4-21 (A) the value of the claim is $100,000 but less
4-22 than $200,000; or
4-23 (B) the value of the claim is $20,000 or more
4-24 but less than $100,000 and the actor has been previously convicted
4-25 of a felony under this chapter; or
5-1 (7) a felony of the first degree if the value of the
5-2 claim is $200,000 or more.
5-3 (e) A person who is subject to prosecution under both this
5-4 section and another section of this code may be prosecuted under
5-5 either or both sections. Section 3.04 does not apply to criminal
5-6 episodes prosecuted under both this section and another section of
5-7 this code. If a criminal episode is prosecuted under both this
5-8 section and another section of this code and sentences are assessed
5-9 for conviction under both sections, the sentences shall run
5-10 concurrently.
5-11 Sec. 35.03. AGGREGATION AND MULTIPLE OFFENSES. (a) When
5-12 separate insurance claims in violation of this chapter are
5-13 communicated to an insurer or group of insurers pursuant to one
5-14 scheme or continuing course of conduct, the conduct may be
5-15 considered as one offense and the amounts aggregated in determining
5-16 the category of the offense, and paragraph (b) of this section
5-17 shall not apply.
5-18 (b) When three or more separate claims in violation of this
5-19 chapter are communicated to an insurer or group of insurers within
5-20 a period of twelve calendar months, the penalty for such multiple
5-21 offenses shall be one category higher than the most serious single
5-22 offense proven from the separate claims, unless aggregation under
5-23 paragraph (a) of this section has already been applied to raise the
5-24 category above the most serious single offense proven from the
5-25 separate claims; except that if the most serious single offense is
6-1 a felony of the first degree, the offense is a felony of the first
6-2 degree.
6-3 Sec. 35.04. JURISDICTION OF ATTORNEY GENERAL. The attorney
6-4 general may prosecute offenses under this chapter, if he is
6-5 requested to do so by the district attorney, criminal district
6-6 attorney, county attorney, or county attorney with felony
6-7 responsibilities, whichever is applicable.
6-8 SECTION 2. Subsection (2), Article 59.01, Code of Criminal
6-9 Procedure, is amended to read as follows:
6-10 (2) "Contraband" means property of any nature,
6-11 including real, personal, tangible, or intangible, that is:
6-12 (A) used in the commission of:
6-13 (i) any first or second degree felony
6-14 under the Penal Code;
6-15 (ii) any felony under Chapters 29, 30, 31,
6-16 or 32, Penal Code; or
6-17 (iii) any felony under The Securities Act
6-18 (Article 581-1 et seq., Vernon's Texas Civil Statutes);
6-19 (B) used or intended to be used in the
6-20 commission of:
6-21 (i) any felony under Chapter 481, Health
6-22 and Safety Code (Texas Controlled Substances Act);
6-23 (ii) any felony under Chapter 483, Health
6-24 and Safety Code;
6-25 (iii) a felony under Article 350, Revised
7-1 Statutes; <or>
7-2 (iv) any felony under Chapter 34, Penal
7-3 Code; <or>
7-4 (v) <(iv)> a Class A misdemeanor under
7-5 Subchapter B, Chapter 365, Health and Safety Code, if the defendant
7-6 has been previously convicted twice of an offense under that
7-7 subchapter;
7-8 (vi) <(v)> any felony under The Sale of
7-9 Checks Act (Article 489d, Vernon's Texas Civil Statutes); or
7-10 (vii) any felony under Chapter 35, Penal
7-11 Code.
7-12 (C) the proceeds gained from the commission of a
7-13 felony listed in Paragraph (A) or (B) of this subdivision or a
7-14 crime of violence; or
7-15 (D) acquired with proceeds gained from the
7-16 commission of a felony listed in Paragraph (A) or (B) of this
7-17 subdivision or a crime of violence.
7-18 SECTION 3. SEVERABILITY. If any section, sentence, clause,
7-19 or part of this Act shall, for any reason, be held invalid, such
7-20 invalidity shall not affect the remaining portions of the Act, and
7-21 it is hereby declared to be the intention of this legislature to
7-22 have passed each section, sentence, clause, or part irrespective of
7-23 the fact that any other section, sentence, clause, or part may be
7-24 declared invalid.
7-25 SECTION 4. CRIMINAL OFFENSES OR VIOLATIONS. (a) The
8-1 changes in law made by this Act apply only to a criminal offense
8-2 committed or a violation that occurs on or after the effective date
8-3 of this Act. For the purposes of this Act, a criminal offense is
8-4 committed or a violation occurs before the effective date of this
8-5 Act if any element of the offense or violation occurs before that
8-6 date.
8-7 (b) A criminal offense committed or violation that occurs
8-8 before the effective date of this Act is covered by the law in
8-9 effect when the criminal offense was committed or the violation
8-10 occurred, and the former law is continued in effect for this
8-11 purpose.
8-12 SECTION 5. APPROPRIATION OF FEES AND CIVIL PENALTIES. In
8-13 addition to moneys appropriated elsewhere, the attorney general is
8-14 hereby appropriated all fees assessed pursuant to and all recovered
8-15 expenses incurred in obtaining administrative and/or civil
8-16 penalties authorized by Chapter 35, Penal Code and credited to the
8-17 attorney general law enforcement account. Recovered expenses
8-18 include, but are not limited to, investigative costs, witness fees,
8-19 attorneys' fees, and deposition expenses. Moneys hereby
8-20 appropriated may be expended only for purposes of enforcing the
8-21 provisions of Chapter 35, Penal Code, and may not be appropriated
8-22 for any other purpose. Unexpended balances credited to the account
8-23 at the end of each biennium are carried over to each successive
8-24 biennium.
8-25 SECTION 6. EFFECTIVE DATE. This Act takes effect on
9-1 September 1, 1995.
9-2 SECTION 7. EMERGENCY. The importance of this legislation
9-3 and the crowded condition of the calendars in both houses create an
9-4 emergency and an imperative public necessity that the
9-5 constitutional rule requiring bill to be read on three several days
9-6 in each house be suspended, and this rule is hereby suspended, and
9-7 that this Act take effect and be in force from and after its
9-8 passage, and it is so enacted.