By Counts H.B. No. 1487
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, with intent to defraud or deceive an insurer:
2-14 (1) the person causes to be prepared or presents to an
2-15 insurer in support of a claim for payment under a health or
2-16 property insurance policy a statement that the person knows
2-17 contains false or misleading information concerning a matter than
2-18 is material to the claim that effects:
2-19 (A) a person's right to a payment; or
2-20 (B) the amount of payment to which a person is
2-21 entitled; or
2-22 (2) the person causes to be prepared or presents to an
2-23 insurer in support of a claim for payment under a health or
2-24 property insurance policy a statement that the person knows
2-25 conceals or fails to disclose a material fact that affects:
3-1 (A) a person's right to a payment;
3-2 (B) the amount of payment to which a person is
3-3 entitled.
3-4 (b) A person commits an offense if the person, with intent
3-5 to defraud or deceive an insurer, solicits, offers, pays or
3-6 receives a benefit in connection with the furnishing of health care
3-7 goods or services for which payment is sought under an insurance
3-8 policy.
3-9 (c) For purposes of Subsection (a) of this chapter,
3-10 information concerning a matter that is material to a claim for
3-11 payment under an insurance policy includes, but is not limited to,
3-12 information concerning:
3-13 (1) whether health care goods or services were
3-14 provided;
3-15 (2) whether health care goods or services were
3-16 medically necessary under professionally accepted standards;
3-17 (3) the nature of the health care goods or services
3-18 provided;
3-19 (4) the date on which health care goods or services
3-20 were provided;
3-21 (5) the medical record of goods or services provided;
3-22 (6) the condition treated or diagnosis made;
3-23 (7) the identity and applicable license of the
3-24 provider or the recipient of health care goods or services;
3-25 (8) whether property was damaged or lost in the manner
4-1 and under the circumstances described in a statement related to a
4-2 claim for insurance payment; or
4-3 (9) whether any other claim for insurance payment has
4-4 been communicated to any other insurer concerning property damage
4-5 or loss to the same property.
4-6 (d) Except as provided by Subsection (e) of this section, an
4-7 offense under this section is:
4-8 (1) a Class C misdemeanor if the value of the claim is
4-9 less than $20; or
4-10 (2) a Class B misdemeanor if the value of the claim is
4-11 $20 or more but less than $500;
4-12 (3) a Class A misdemeanor if the value of the claim is
4-13 $500 or more but less than $1,500;
4-14 (4) a state jail felony if the value of the claim is
4-15 $1,500 or more but less than $20,000;
4-16 (5) a felony of the third degree if the value of the
4-17 claim is $20,000 or more but less than $100,000;
4-18 (6) a felony of the second degree if the value of the
4-19 claim is $100,000 but less than $200,000; or
4-20 (7) a felony of the first degree if the value of the
4-21 claim is $200,000 or more.
4-22 (e) A person who is subject to prosecution under both this
4-23 section and another section of this code may be prosecuted under
4-24 either or both sections.
4-25 Sec. 35.03. AGGREGATION AND MULTIPLE OFFENSES. (a) When
5-1 separate insurance claims in violation of this chapter are
5-2 communicated to an insurer or group of insurers pursuant to one
5-3 scheme or continuing course of conduct, the conduct may be
5-4 considered as one offense and the amounts aggregated in determining
5-5 the category of the offense, and paragraph (b) of this section
5-6 shall not apply.
5-7 (b) When three or more separate claims in violation of this
5-8 chapter are communicated to an insurer or group of insurers, the
5-9 penalty for such multiple offenses shall be one category higher
5-10 than the most serious single offense proven from the separate
5-11 claims, unless aggregation under paragraph (a) of this section has
5-12 already been applied to raise the category above the most serious
5-13 single offense proven from the separate claims; except that if the
5-14 most serious single offense is a felony of the first degree, the
5-15 offense is a felony of the first degree.
5-16 Sec. 35.04. JURISDICTION OF ATTORNEY GENERAL. (a) The
5-17 attorney general may offer the investigative, technical, and
5-18 litigation assistance of his office in any prosecution of alleged
5-19 violations brought by a district attorney, criminal district
5-20 attorney, county attorney with felony responsibility, or county
5-21 attorney.
5-22 (b) If he is requested to do so by the district attorney,
5-23 criminal district attorney, county attorney with felony
5-24 responsibilities, or county attorney, the attorney general may
5-25 prosecute or assist in the prosecution of offenses under this
6-1 chapter.
6-2 Sec. 35.05. PROPERTY DISTRIBUTION UNDER ASSET FORFEITURE.
6-3 (a) If a person's assets are forfeited under Chapter 59, Code of
6-4 Criminal Procedure, pursuant to enforcement of this chapter, the
6-5 priority of payment for the distribution of those assets is as
6-6 follows:
6-7 (1) the attorney general, if the attorney general has
6-8 investigated, prosecuted, or assisted in the prosecution of the
6-9 case; and
6-10 (2) the district attorney, criminal district attorney,
6-11 county attorney with felony responsibilities, or county attorney,
6-12 if that person has investigated, prosecuted or assisted in the
6-13 prosecution of the case.
6-14 (b) Pursuant to the provisions of Chapter 47, Code of
6-15 Criminal Procedure, the judge may order that any remaining proceeds
6-16 be remitted to the property insurance or health insurance company
6-17 or companies that were defrauded.
6-18 SECTION 2. Subsection (2), Article 59.01, Code of Criminal
6-19 Procedure, is amended to read as follows:
6-20 (2) "Contraband" means property of any nature,
6-21 including real, personal, tangible, or intangible, that is:
6-22 (A) used in the commission of:
6-23 (i) any first or second degree felony
6-24 under the Penal Code;
6-25 (ii) any felony under Chapters 29, 30, 31,
7-1 or 32, Penal Code; or
7-2 (iii) any felony under The Securities Act
7-3 (Article 581-1 et seq., Vernon's Texas Civil Statutes);
7-4 (B) used or intended to be used in the
7-5 commission of:
7-6 (i) any felony under Chapter 481, Health
7-7 and Safety Code (Texas Controlled Substances Act);
7-8 (ii) any felony under Chapter 483, Health
7-9 and Safety Code;
7-10 (iii) a felony under Article 350, Revised
7-11 Statutes; <or>
7-12 (iv) any felony under Chapter 34, Penal
7-13 Code; <or>
7-14 (v) <(iv)> a Class A misdemeanor under
7-15 Subchapter B, Chapter 365, Health and Safety Code, if the defendant
7-16 has been previously convicted twice of an offense under that
7-17 subchapter;
7-18 (vi) <(v)> any felony under The Sale of
7-19 Checks Act (Article 489d, Vernon's Texas Civil Statutes); or
7-20 (vii) any felony under Chapter 35, Penal
7-21 Code.
7-22 (C) the proceeds gained from the commission of a
7-23 felony listed in Paragraph (A) or (B) of this subdivision or a
7-24 crime of violence; or
7-25 (D) acquired with proceeds gained from the
8-1 commission of a felony listed in Paragraph (A) or (B) of this
8-2 subdivision of a crime of violence.
8-3 SECTION 3. SEVERABILITY. If any section, sentence, clause,
8-4 or part of this Act shall, for any reason, be held invalid, such
8-5 invalidity shall not affect the remaining portions of the Act, and
8-6 it is hereby declared to be the intention of this legislature to
8-7 have passed each section, sentence, clause, or part irrespective of
8-8 the fact that any other section, sentence, clause, or part may be
8-9 declared invalid.
8-10 SECTION 4. CRIMINAL OFFENSES OR VIOLATIONS. (a) The
8-11 changes in law made by this Act apply only to a criminal offense
8-12 committed or a violation that occurs on or after the effective date
8-13 of this Act. For the purposes of this Act, a criminal offense is
8-14 committed or a violation occurs before the effective date of this
8-15 Act if any element of the offense or violation occurs before that
8-16 date.
8-17 (b) A criminal offense committed or violation that occurs
8-18 before the effective date of this Act is covered by the law in
8-19 effect when the criminal offense was committed or the violation
8-20 occurred, and the former law is continued in effect for this
8-21 purpose.
8-22 SECTION 5. APPROPRIATION OF FEES, COSTS, AND CIVIL AND
8-23 CRIMINAL PENALTIES. In addition to moneys appropriated elsewhere,
8-24 the attorney general is hereby appropriated all fees assessed
8-25 pursuant to and all recovered expenses incurred in obtaining
9-1 administrative and/or civil penalties authorized by Chapter 35,
9-2 Penal Code and credited to the attorney general law enforcement
9-3 account. Recovered expenses include, but are not limited to,
9-4 investigative costs, witness fees, attorneys' fees, and deposition
9-5 expenses. Moneys hereby appropriated may be expended only for
9-6 purposes of enforcing the provisions of Chapter 35, Penal Code, and
9-7 may not be appropriated for any other purpose. Unexpended balances
9-8 credited to the account at the end of each biennium are carried
9-9 over to each successive biennium.
9-10 SECTION 6. EFFECTIVE DATE. This Act takes effect on
9-11 September 1, 1995.
9-12 SECTION 7. EMERGENCY. The importance of this legislation
9-13 and the crowded condition of the calendars in both houses create an
9-14 emergency and an imperative public necessity that the
9-15 constitutional rule requiring bill to be read on three several days
9-16 in each house be suspended, and this rule is hereby suspended, and
9-17 it is so enacted.