Amend CSSB 386 by striking all below the enacting clause and
substituting the following:
SECTION 1. Title 4, Civil Practice and Remedies Code, is
amended by adding Chapter 88 to read as follows:
CHAPTER 88. CERTAIN HEALTH CARE LIABILITY CLAIMS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 88.001. DEFINITIONS. In this chapter:
(1) "Enrollee" means an individual who is enrolled in
a managed care plan. The term includes a dependent of an enrollee
who is covered under the plan.
(2) "Health care" has the meaning assigned by Section
1.03, Medical Liability and Insurance Improvement Act of Texas
(Article 4590i, Vernon's Texas Civil Statutes).
(3) "Health care provider" means a person or entity as
defined by Section 1.03, Medical Liability and Insurance
Improvement Act of Texas (Article 4590i, Vernon's Texas Civil
Statutes).
(4) "Managed care entity" means an entity described by
Section 88.002.
(5) "Managed care plan" means a health benefit plan:
(A) under which medical care and health care are
provided to enrollees through contracts with physicians and health
care providers; and
(B) that provides financial incentives to
enrollees in the plan to use the participating physicians and
providers and procedures covered by the plan.
(6) "Medical care" has the meaning assigned by Section
1.03, Medical Liability and Insurance Improvement Act of Texas
(Article 4590i, Vernon's Texas Civil Statutes).
(7) "Physician" means a person licensed to practice
medicine in this state.
Sec. 88.002. SCOPE OF CHAPTER. This chapter applies to a
health maintenance organization organized under the Texas Health
Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
Code), a preferred provider organization, an approved nonprofit
health corporation that holds a certificate of authority issued by
the commissioner under Article 21.52F, Insurance Code, or any other
entity that offers a managed care plan, including:
(1) an insurance company;
(2) a group hospital service corporation operating
under Chapter 20, Insurance Code;
(3) a fraternal benefit society operating under
Chapter 10, Insurance Code;
(4) a stipulated premium insurance company operating
under Chapter 22, Insurance Code; or
(5) to the extent permitted by the Employee Retirement
Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.):
(A) a multiple employer welfare arrangement as
defined by Section 3, Employee Retirement Income Security Act of
1974 (29 U.S.C. Section 1002), or another analogous benefit
arrangement; and
(B) any other entity not licensed under the
Insurance Code or another insurance law of this state that
contracts directly for health care services on a risk-sharing
basis, including an entity that contracts for medical care and
health care under a capitation method.
Sections 88.003-88.010 reserved for expansion
SUBCHAPTER B. DUTY OF MANAGED CARE ENTITY
Sec. 88.011. DUTY OF REASONABLE CARE. A managed care entity
has the duty to act with that care that would be exercised by a
prudent managed care entity under the same or similar circumstances
when making a determination that, concurrently or prospectively,
denies benefits for a treatment recommended or prescribed by a
physician or health care provider for an enrollee in the course of
providing medical care or health care to the enrollee under the
managed care plan.
Sec. 88.012. LIABILITY. (a) A managed care entity is
liable for damages arising from a breach of the duty imposed by
Section 88.011 if that breach proximately causes personal injury or
death to an enrollee.
(b) A cause of action for damages brought under this section
is the exclusive remedy against a managed care entity for damages
for personal injury or death suffered by an enrollee arising as a
result of the failure to provide or the provision of health care or
medical care under a managed care plan. This subsection does not
apply to an action in contract that does not relate to bodily
injury to or death of the enrollee. This subsection does not
affect a remedy established under the Deceptive Trade
Practices-Consumer Protection Act (Section 17.41 et seq., Business
& Commerce Code) or under the Insurance Code or another insurance
law of this state, including Articles 21.21 and 21.55, Insurance
Code.
(c) The limitations, restrictions, and procedural
requirements of the Medical Liability and Insurance Improvement Act
of Texas (Article 4590i, Vernon's Texas Civil Statutes), apply to a
cause of action for damages under this section as if the managed
care entity were a health care provider and as if the cause of
action were based on a health care liability claim as defined by
that Act.
Sec. 88.013. INDEMNIFICATION OR HOLD HARMLESS. A managed
care entity may not enter into a contract with a physician or
health care provider that includes an indemnification or hold
harmless clause for the acts or conduct of the managed care entity.
Sec. 88.014. RETALIATION PROHIBITED. A managed care entity
may not terminate or fail to renew the contract of a physician or
health care provider or take any other retaliatory action against
the physician or provider because the physician or provider has
advocated on behalf of an enrollee with respect to a treatment
prescribed or recommended by the physician or provider.
Sec. 88.015. LICENSING LAW NOT DEFENSE. A law of this
state prohibiting a managed care entity from practicing medicine or
from being licensed to practice medicine may not be asserted as a
defense to an action against a managed care entity under this
chapter.
SECTION 2. This Act applies only to a cause of action that
accrues on or after the effective date of this Act. An action that
accrues before the effective date of this Act is governed by the
law applicable to the action immediately before the effective date
of this Act, and that law is continued in effect for that purpose.
SECTION 3. An indemnification or hold harmless clause
prohibited by Section 88.013, Civil Practice and Remedies Code, as
added by this Act, violates the public policy of this state and, if
such a clause is contained in any contract in effect on the
effective date of this Act, the clause is void.
SECTION 4. This Act takes effect September 1, 1997.
SECTION 5. The importance of this legislation and the
crowded condition of the calendars in both houses create an
emergency and an imperative public necessity that the
constitutional rule requiring bills to be read on three several
days in each house be suspended, and this rule is hereby
suspended.