By Madla S.B. No. 1290
74R4290 PB-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a requirement that managed care health plans provide
1-3 certain information to applicants for participation who are 61
1-4 years of age or older.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subchapter E, Chapter 21, Insurance Code, is
1-7 amended by adding Article 21.52E to read as follows:
1-8 Art. 21.52E. INFORMATION REQUIRED TO BE PROVIDED TO CERTAIN
1-9 PARTICIPANTS IN MANAGED CARE PLANS
1-10 Sec. 1. DEFINITIONS. In this article:
1-11 (1) "Applicant" means an individual who applies for
1-12 health care coverage through a managed care plan.
1-13 (2) "Managed care plan" means a health maintenance
1-14 organization, a preferred provider organization, or another
1-15 organization that, under a contract or other agreement entered into
1-16 with a participant in the plan:
1-17 (A) provides health care benefits, or arranges
1-18 for health care benefits to be provided, to a participant in the
1-19 plan; and
1-20 (B) requires or encourages those participants to
1-21 use health care providers designated by the plan.
1-22 (3) "Member" means a health care provider who is
1-23 designated by a managed care plan to provide services for
1-24 participants in the plan.
2-1 Sec. 2. REQUIRED INFORMATION FOR CERTAIN APPLICANTS FOR
2-2 PARTICIPATION. (a) Each managed care plan shall provide
2-3 information as required by this section to an applicant for
2-4 participation in the plan who is 61 years of age or older.
2-5 (b) The managed care plan shall advise the applicant at the
2-6 time the application is made whether the applicant's current health
2-7 care providers are members of the managed care plan. The managed
2-8 care plan may require the applicant to provide information
2-9 regarding current health care providers in the application for
2-10 participation as necessary for the plan to identify those providers
2-11 and comply with this subsection.
2-12 (c) Not later than the 10th day after the date on which the
2-13 managed care plan receives the application for participation, the
2-14 plan shall issue a written document to the applicant that:
2-15 (1) lists each health care provider included under
2-16 Subsection (b) of this section in the application for participation
2-17 and states whether that health care provider is a member as of the
2-18 date of the application; and
2-19 (2) lists each hospital included in the plan.
2-20 Sec. 3. STATEMENT. (a) If an applicant to whom a managed
2-21 care plan is required to provide information under Section 2 of
2-22 this article meets the requirements for participation in the plan
2-23 and elects to participate, the plan shall issue to the applicant a
2-24 statement as described by Subsection (b) of this section. The
2-25 applicant shall sign the statement and return the statement to an
2-26 office designated by the managed care plan, which shall retain the
2-27 signed statement in the plan's records relating to that applicant.
3-1 (b) The statement required under Subsection (a) of this
3-2 section must be printed in at least 12-point type and must include:
3-3 (1) a copy of the document issued under Section 2(c)
3-4 of this article; and
3-5 (2) a statement that the applicant understands that:
3-6 (A) each of the health care providers included
3-7 in the application for participation under Section 2(b) of this
3-8 article is or is not a designated provider under the plan;
3-9 (B) as a participant in the plan, the applicant
3-10 is required to use a provider designated by the plan in order to
3-11 receive full coverage;
3-12 (C) a health care provider listed in the
3-13 application for participation under Section 2(b) of this article
3-14 will not receive full reimbursement from the plan for services
3-15 provided if the health care provider is not a designated provider
3-16 under the plan and, based on the terms of the plan, may not receive
3-17 any reimbursement if the health care provider is not a designated
3-18 provider under the plan; and
3-19 (D) the hospitals listed in the document issued
3-20 under Section 2(c) of this article are the only hospitals that will
3-21 receive reimbursement by the plan for services provided.
3-22 Sec. 4. STATEMENT TO PROVIDER. Not later than the 10th day
3-23 after the date on which the applicant is accepted for participation
3-24 in the managed care plan, the plan shall issue a written statement
3-25 to each health care provider listed by the applicant under Section
3-26 2(b) of this article that the applicant has joined the managed
3-27 health care plan and indicate whether services rendered to the
4-1 individual by the provider will or will not be reimbursed by the
4-2 plan.
4-3 Sec. 5. EVIDENCE OF COVERAGE. A managed care plan may not
4-4 issue an evidence of coverage to an applicant subject to this
4-5 article until the plan receives the applicant's signed statement in
4-6 accordance with Section 3. A plan that issues an evidence of
4-7 coverage in violation of this section is liable to reimburse the
4-8 applicant for health care services received by the applicant from a
4-9 health care provider, whether or not that health care provider is a
4-10 member.
4-11 Sec. 6. ADMINISTRATIVE PENALTY. A managed care plan that
4-12 violates this article commits a violation of this code and is
4-13 subject to an administrative penalty under Article 1.10E of this
4-14 code.
4-15 SECTION 2. This Act takes effect September 1, 1995, and
4-16 applies only to an evidence of coverage under a managed care health
4-17 plan that is delivered, issued for delivery, or renewed on or after
4-18 January 1, 1996. An evidence of coverage that is delivered, issued
4-19 for delivery, or renewed before January 1, 1996, is governed by the
4-20 law as it existed immediately before the effective date of this
4-21 Act, and that law is continued in effect for that purpose.
4-22 SECTION 3. The importance of this legislation and the
4-23 crowded condition of the calendars in both houses create an
4-24 emergency and an imperative public necessity that the
4-25 constitutional rule requiring bills to be read on three several
4-26 days in each house be suspended, and this rule is hereby suspended.