KMS H.B. 3270 75(R)    BILL ANALYSIS


INSURANCE
H.B. 3270
By: Berlanga
5-12-97
Committee Report (Unamended)



BACKGROUND 
Under current law, insurance providers are not required to disclose the
amount of money they pay out on insurance claims to group policyholders
for any particular time period.  Policyholders of group insurance coverage
plans are unable to acquire totals for the amount of claims paid out on
their coverage.  This bill would require insurance providers to disclose
to policyholders the total amount of insurance claims paid out by the
provider. 

PURPOSE
As proposed, this legislation would require insurance provides to disclose
the actual claims paid on policyholders. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does grant rulemaking
authority to the Commissioner of Insurance in SECTION 1 of the bill (Sec.
5, Article 21.24-3, Insurance Code). 

SECTION BY SECTION ANALYSIS
SECTION 1.  Adds Article 21.24-3 to the Insurance Code.

Section 1. Provides definitions for "health benefit plan" and "insurer."

Section 2.  Limits the application of this article only to health benefit
plans provided for group benefits for medical or surgical expenses and is
offered by a nonprofit health corporation certified under Section 5.01(a),
Medical Practice Act and holds a certificate of authority from the
Commissioner of Insurance, or is offered by another entity that contracts
directly for health care services on a risk-sharing basis. 

Section 3.  Requires that insurers to notify each group policyholder in
writing, each claim filed against the policy, proposal to claim
settlement, any administrative or judicial procedures related to
resolution of the claim.  This report must be provided by the insurer to
the policyholder semiannually. 

Section 4.  Requires HMOs and other managed care entities to notify the
policyholder of group coverage semiannually in writing of any amounts paid
and charged to the group contract holder, other than those charges
negotiated in the contract. 

Section 5.  Allows the Commissioner of Insurance to adopt rules providing
a format as to how the reports from the insurer to the policyholder is to
be reported. 

SECTION 2.  This article applies only to health benefit plans delivered,
issued for delivery, or renewed on or after January 1, 1998. 

SECTION 3.  Effective date is September 1, 1997.

SECTION 4.  Emergency clause.