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.