BILL ANALYSIS INSURANCE C.S.S.B. 385 By: Sibley (Smithee) 5-2-97 Committee Report (Substituted) BACKGROUND Currently, managed care systems continue to change the delivery of health care in Texas. Since the onset of managed care, the state's market has seen tremendous growth, with the number of HMO enrollees increasing by 64.4 percent since 1992. During the 74th Interim, the Senate Interim Committee on Managed Care and Consumer Protections was charged with reviewing Texas statutes and agency regulations to ensure the availability and effectiveness of important consumer safeguards. This legislation establishes the transfer of quality of care oversight functions from the Texas Department of Health (TDH) to the Texas Department of Insurance (TDI). In addition, this bill provides strengthening and codification of certain TDI and TDH rules regarding access and quality of care, and recommendations of the Interim Committee for improved consumer protections. PURPOSE To implement the recommendations of the Senate Interim Committee on Managed Care and Consumer Protections relating to codification of patient protection rules promulgated by the Texas Department of Insurance (TDI) and the Texas Department of Health (TDH); transfer of quality of care regulation from TDH to TDI; clarification of commissioner of insurance's authority to impose sanctions, administrative penalties, issue cease and desist orders, or suspend or revoke certificate of authority of HMO after notice and opportunity for hearing; clarification of commissioner's authority to promulgate rules to ensure that enrollees have adequate access to health care services and to establish minimum physician/patient ratios, mileage requirements, maximum travel times and maximum waiting times for scheduled appointments; providing for confidentiality of medical information; and requiring HMO to establish physician review panel to assist in determining prescription drugs to be covered by the plan. RULEMAKING AUTHORITY It is the opinion of the committee that rulemaking authority is expressly granted to the Commissioner of Insurance in the following sections of the bill: SECTION 4 (Section 20A.05(a)(1)(B) and(C), Insurance Code); SECTION 5 (Section 20A.09(l), Insurance Code); SECTION 9 (Section 20A.12(a), Insurance Code); SECTION 20 (Article 20A.22(c), Insurance Code); SECTION 24 (Article 20A.32(a)(1)(D), Insurance Code); and SECTION 26 (Article 20A.37(b) and (h), Insurance Code). Although rulemaking authority is not expressly granted, the Commissioner of Insurance is given the authority to adopt standards in SECTION 5 (Section 20A.09(n), Insurance Code); the Commissioner of Insurance is given the authority to prescribe a format in SECTION 6 (Section 20A.11(b), Insurance Code); and rulemaking authority granted under the code is referenced in SECTION 26 (Section 20A.38(c)(3), Insurance Code). References to rulemaking authority granted to the now defunct State Board of Insurance have been updated to refer to the Commissioner of Insurance in the following sections of the bill: SECTION 3 (Article 20A.04(b), Insurance Code); SECTION 13 (Article 20A.15(g), Insurance Code); SECTION 14 (Article 20A.15A(h), Insurance Code); SECTION 18 (Article 20A.19(b), Insurance Code); SECTION 20 (Article 20A.22 (a) and (b), Insurance Code); SECTION 21 (Article 20A.23(a), Insurance Code); and SECTION 25 (Article 20A.36(e), Insurance Code). SECTION BY SECTION ANALYSIS SECTION 1. Amends Article 20A.02, Insurance Code (Texas Health Maintenance Organization Act), to define "adverse determination," "capitation," "complainant," "complaint," "emergency care," "life threatening," and "prospective enrollee." Redefines "physician" to include a medical school or medical dental unit that employs or contracts with physicians to teach or provide medical services or employs physicians and contracts with physicians in a practice plan; "basic health care services," to provide that the commissioner may determine, but must include at a minimum, those services designated as basic health care services under the Public Health Service Act; and "emergency care." Adds "mental health" to definitions of "health care" and "health care services," and "registered optician" to definition of "provider." Deletes the definitions for "board." Makes conforming changes. SECTION 2. Amends Article 20A.03, Insurance Code, by adding Subsections (e)-(h), to prohibit a person, physician, or provider from directly or indirectly performing any of the acts of a health maintenance organization (HMO), except in accordance with this Act, and requires any person, physician, or provider in violation of this prohibition to be subject to all enforcement processes and procedures available against an unauthorized insurer pursuant to Articles 1.14-1 and 1.19-1, Insurance Code. Allows the commissioner of insurance (commissioner) to have subpoena authority in accordance with Article 1.19-1, Insurance Code._ SECTION 3. Amends Article 20A.04, Insurance Code, to establish the conditions by which each application for a certificate of authority is required to contain a written description of health care plan terms and conditions; network configuration information; a written description of the types of compensation arrangements; documentation demonstrating that the HMO will pay for emergency care services performed by non-network physicians or providers at certain rates; and that the health care plan contains certain provisions and procedures for coverage of emergency care services. Sets forth the terms by which the commissioner, rather than the State Board of Insurance, is authorized to promulgate rules and regulations requiring an HMO to submit modifications or amendments to the operations or documents described in Subsection (a) of this section to the commissioner. SECTION 4. Amends Article 20A.05, Insurance Code, to delete the provision requiring the commissioner to begin consideration of an application for issuance of a certificate of authority and transmit copies of the application and accompanying documents to the Board of Health upon receipt of the application. Deletes the provision requiring the Texas Board of Health to determine whether the applicant has met certain requirements. Sets forth the terms by which the commissioner is required to issue or deny a certificate within 75 days of the receipt of a completed application, provided certain conditions exist. Requires the issuance of the certificate of authority to be granted upon payment of the application fee if the commissioner is satisfied that the applicant has demonstrated the willingness and ability to assure that such health care services will be provided in a suitable manner; has arrangements for an ongoing quality of health care assurance program; and has a procedure to compile, evaluate, and report statistics relating to the cost of operation and utilization and quality of its services. Renumbers sections accordingly._ SECTION 5. Amends Article 20A.09, Insurance Code, to establish the terms by which evidence of coverage under a health care plan is required to contain a provision requiring an HMO to allow referral to a non-network physician or provider if medically necessary covered services are unavailable through network providers; allowing enrollees with chronic, disabling, or lifethreatening illnesses to apply for a nonprimary care physician specialist as a primary care physician; authorizing an enrollee who is denied the request for a nonprimary care physician specialist to appeal the decision; and prohibiting the effective date regarding the new designation of a nonprimary care physician from being retroactive. Provides that if an evidence of coverage provides benefits for rehabilitation services and therapies, and that in the opinion of a physician, are medically necessary, the provision of those services and therapies may not be denied, limited, or terminated by the HMO based on a determination that the services and therapies are not resulting, or will result, in significant improvement in the enrollee's condition. Requires an HMO to comply with Article 21.55, Insurance Code, with respect to prompt payment to enrollees. Requires HMO to make payment to a physician or provider not later than the 45th day after a date a claim for payment is received with necessary documentation, or within a period, not to exceed 60 days, specified by a written agreement between the physician or provider and the HMO. Defines "covered services." An HMO that provides a basic health care plan shall provide basic health care services to its enrollees without limitations as to time and cost, except for limits prescribed by rule of commissioner. Provides that nothing in this Act shall require an HMO, physician, or provider to recommend, offer advice concerning, pay for, provide, or perform any health care service that violates its religious convictions; but requires an HMO with such convictions to set forth those limitations in the evidence of coverage. Authorizes the commissioner to adopt minimum standards relating to basic health care services. SECTION 6. Amends Article 20A.11, Insurance Code, Sec. 11, changing the heading: to INFORMATION TO PROSPECTIVE AND CURRENT GROUP CONTRACT HOLDERS AND ENROLLEES. Requires a plan application form to include a space in which the enrollee is required to make a selection of a primary care physician or provider. Sets forth the terms by which an enrollee is required to have the right to make that selection, and authorizes an HMO to limit an enrollee's requested changes to no more than four in any 12-month period. Establishes the conditions by which an HMO is required to provide on request a written description of health care plan terms and conditions, and notify a group contract holder of any substantive changes to the payment arrangements between the organization and health care providers not later than the 30th day after the effective date of the change. Sets out 12 specific items of information that are required to be included in the written description, and allows the commissioner to require additional information. The HMO may provide a handbook to satisfy the requirements of subsection (b), if the handbook is substantially similar to the description as prescribed by the commissioner. An HMO shall notify a group contract holder of any substantive change in payment method between the HMO and physicians or providers within 30 days of the change. Prohibits an HMO from permitting the use or distribution of prospective enrollee information which is untrue or misleading. SECTION 7. Amends Chapter 20A, Insurance Code, by adding new Section 11A providing that each HMO or approved nonprofit health corporation holding a certificate of authority shall establish procedures to provide to an enrollee a member handbook and materials relating to the complaint and appeals process in languages of the major populations of the enrolled population, and to an enrollee who has a disability affecting the enrollee's ability to communicate or to read. Defines major population as a group comprising 10% or more of the HMO's enrolled population. SECTION 8. Amends Chapter 20A, Insurance Code, by adding new Section 11B, entitled INFORMATION TO ENROLLEES AND PROSPECTIVE ENROLLEES: MEDICARECONTRACTING HEALTH MAINTENANCE ORGANIZATION. The new provision requires a Medicare-contracting HMO to provide a specific disclosure to prospective enrollees before enrollment in a health care plan offered to Medicare recipients. The disclosure concerns the possibility that if the enrollee enrolls in the health care plan and remains enrolled for more than 6 months after his/her 65th birthday, he/she may lose the opportunity to purchase Medicare supplement insurance (Medigap). _ SECTION 9. Amends Article 20A.12, Insurance Code, as follows: Establishes the conditions by which every HMO is required to establish and maintain a complaint resolution system including a process for the notice and appeal of complaints. Authorizes the commissioner to promulgate rules and regulations necessary or proper to implement and administer this section. Requires a complaint resolution system to be implemented and maintained by an HMO. If a complainant notifies the HMO of a complaint, the HMO shall send an acknowledgment of receipt of the complaint within 5 days. Requires the complaint procedure to include provisions to meet certain requirements regarding receipt and investigation of complaints; total time for complaint resolution may not exceed 30 calendar days after HMO receives complaint; complaints regarding appeals of emergencies or denials of continued stays for hospitalization may not exceed 1 business day from date of receipt; complaint and appeal acknowledgment letters; complaint appeal process and composition of panel; complaint records; and notice of the final decision on the appeal. Sets out standard for what complainant or representative of the complainant is allowed to do. Investigation and resolution of appeals to emergencies will be performed in accordance with the immediacy of the appeal. Notice of the final decision must include a specific statement of the medical determination, clinical basis, and contractual criteria for making the decision. The HMO shall maintain a record, log and documentation of each complaint and any action taken on the complaint for three years from receipt of the complaint. Authorizes the commissioner to examine such complaint system for compliance with this Act and require the HMO to make corrections as deemed necessary by the commissioner. SECTION 10. Amends Article 20A.01 et seq., Insurance Code, by adding Section 12A, entitled FILING COMPLAINTS WITH THE TEXAS DEPARTMENT OF INSURANCE. Sets forth the terms by which a person is authorized to report an alleged violation of this Act to the Texas Department of Insurance. Requires the commissioner to investigate a complaint against an HMO not later than the 60th day after receipt of the complaint and all information necessary for the department to determine compliance. The commissioner is authorized to extend the time necessary to complete the investigation in certain circumstances. SECTION 11. Amends Articles 20A.13(a)-(c) and (f)-(h), Insurance Code, to set forth the terms by which each HMO is required to deposit with the comptroller, rather than the State Treasurer, cash, securities, or other guarantees acceptable to the commissioner, rather than the State Board of Insurance. SECTION 12. Amends Article 20A.14, Insurance Code, by adding Subsections (i)-(m), to prohibit an HMO from prohibiting, attempting to prohibit, or discouraging a physician or provider, as a condition of a contract, from communicating information to a current, prospective or former patient or party designated by the patient regarding the patient's health care, or provisions or services of the health care plan. Prohibits an HMO from penalizing, terminating, or refusing to compensate a physician or provider for communicating with a patient pursuant to this section. Establishes the conditions by which an HMO is prohibited from engaging in any retaliatory action against certain people or groups, and is prohibited from using any financial incentive or payment to a physician or provider as an inducement to limit medically necessary services. Prohibits an HMO from requiring the observation of a psychotherapy session, from requiring that a provider's process or progress notes be submitted to the HMO for review, or from denying benefits for psychotherapy on the grounds that a patient refuses medication based on religious beliefs. SECTION 13. Amends Article 20A.15, Insurance Code, New heading: REGULATION OF AGENTS. Requires the commissioner to collect in advance from HMO agent applicants a nonrefundable license fee in a certain amount. Requires all fees collected under this section to be used by the commissioner to administer the provisions of this Act. Requires all of such funds to be paid into the State Treasury to the credit of the Texas Department of Insurance, rather than the State Board of Insurance, operating fund. Authorizes the commissioner, rather than the State Board of Insurance, after notice and hearings, to promulgate rules and regulations necessary to provide for the licensing of agents. SECTION 14. Amends Article 20A.15A, Insurance Code, to change references to "State Board of Insurance" to "commissioner" or "department." SECTION 15. Amends Article 20A.17, Insurance Code, to set forth the terms by which the commissioner is authorized to make an examination concerning the quality of health care services and of the affairs of any applicant for a certificate of authority or any HMO. Requires a copy of any contract or agreement between an HMO and a physician or provider to be provided to the commissioner on request, and to be deemed confidential and not subject to the open records law. Authorizes the commissioner to examine and use the records of an HMO, including records of a quality of care assurance program and records of a medical peer review committee to carry out purposes of the Act, including an enforcement action, and provides such information is confidential and not subject to the open records law. Includes Article 1.04A, Insurance Code, among the list of articles required to be construed to apply to HMOs, except in certain circumstances. SECTION 16. Amends Articles 20A.18(d) and (f), Insurance Code, to change references to the "State Board of Insurance" to the "commissioner," and "state treasurer" to "comptroller." SECTION 17. Amends Article 20A.01 et seq., Insurance Code, by adding Section 18A, PHYSICIAN AND PROVIDER CONTRACTS. Requires an HMO, on request, to disclose to physicians and providers written application procedures and qualification requirements for contracting with the HMO. Sets forth the terms by which each physician and provider who is denied a contract is required to be provided written notice of the reasons. This subsection does not prohibit an HMO plan from rejecting an application based on the determination that the plan has sufficient qualified providers. Sets forth the terms by which an HMO is required to terminate a contract with a physician or provider. A physician or provider is entitled, on request and before the effective date of termination, but within a period not to exceed 60 days, to a review of the HMO's proposed termination. Sets forth composition of advisory review panel; decision of panel not binding on HMO. Sets forth the terms by which each contract must provide that advance notice be given to an enrollee of the impending termination from the plan of a physician or provider who is currently treating the enrollee; and that the termination of the contract does not release the HMO from the obligation to reimburse the physician or provider who is treating an enrollee of special circumstance. Defines "special circumstance." Sets forth the obligation of an HMO to reimburse a terminated physician or provider, or enrollee for services to an enrollee who is past the 24th week of pregnancy at the time of the termination, or for services relating to treatment for a life threatening illness or condition, extends through the completion of the treatment. Requires capitation payments to be calculated from date of enrollment, and to be paid not later than the 30th day following PCP selection. If enrollee does not select primary care physician (PCP), HMO to assign not later than 30th day after enrollment. HMO to notify physician of his selection as PCP not later than 30 days from selection. Sets forth other regulations regarding physician and provider contracts, such as prohibition on indemnification and requirement of hold harmless clause. An HMO that conducts or uses economic profiling of physicians or providers shall make this profile available on request to physician or provider. Including the standards by which the profile is measured. A contract between an HMO and a physician or provider must require the physician or provider to post a notice in their office of the complaint process with the HMO. Defines "termination." SECTION 18. Amends Article 20A.19, Insurance Code, to authorize the commissioner, rather than the State Board of Insurance, by rules and regulations, to fix uniform standards and criteria for early warning that the continued operation of any HMO might be hazardous, and to fix standards for evaluating the financial condition of any HMO. SECTION 19. Amends Article 20A.20(a), Insurance Code, to authorize the commissioner, after notice and opportunity for hearing, to suspend or revoke any certificate of authority issued to an HMO under this Act; impose sanctions under Section 7, Article 1.10, Insurance Code; impose administrative penalties under Article 1.10E, Insurance Code; or issue a cease and desist order under Article 1.10A, Insurance Code, if the commissioner finds that certain conditions exist, including that the HMO has failed to carry out corrective action the commissioner considers necessary to correct a failure to comply with certain rules and provisions. SECTION 20. Amends Article 20A.22, Insurance Code, to authorize the commissioner, rather than the State Board of Insurance, to promulgate rules and regulations as necessary and proper to carry out the provisions of this Act; to meet the requirements of federal law and regulations; to prescribe authorized investments for HMOs in certain cases; to ensure that enrollees have adequate access to health care services and establishing minimum physician/patient ratios, mileage requirements for primary and specialty care, maximum travel time, and maximum waiting times for obtaining appointments; and to establish other regulations relating to patient care. SECTION 21. Amends Article 20A.23, Insurance Code, to require the commissioner, rather than the State Board of Insurance, to make rules and regulations with respect to applications for review of a rule, ruling, or decision of the Texas Department of Insurance or the commissioner, and their consideration, as it considers to be advisable. SECTION 22. Amends Article 20A.26(f)(4), Insurance Code, to provide that a physician or provider who conducts utilization review during the ordinary course of treatment of patients pursuant to a joint or delegated review agreement(s) is prohibited from being required to obtain certification under Section 3, Article 21.58A, Insurance Code. SECTION 23. Amends Article 20A.28, Insurance Code, to delete reference to "board" and to allow opportunity for hearing, rather than an automatic hearing. SECTION 24. Amends Article 20A.32, Insurance Code, to require every organization subject to this chapter to pay to the commissioner a fee not to exceed $18,000, rather than $15,000, as determined by the commissioner for filing and review of its original application for a certificate of authority; and the expenses of an examination under Section 17(a) of this Act, regarding the affairs of any HMO, incurred by the commissioner or under the commissioner's authority, provided certain conditions are met. Deletes references to the Board of Health. SECTION 25. Amends Articles 20A.36(a)-(c), (e), and (g), Insurance Code, to prohibit a public representative of the Health Maintenance Organization Solvency Surveillance Committee from being a person required to register with the Texas Ethics Commission, rather than the secretary of state, under Chapter 305, Government Code. Authorizes the commissioner, rather than the State Board of Insurance, to adopt rules as necessary to implement this Act in certain circumstances. SECTION 26. Amends Article 20A.01 et seq., Insurance Code, by adding Section 37, HEALTH MAINTENANCE ORGANIZATION QUALITY ASSURANCE, which sets forth the terms by which an HMO is required to establish procedures which assure availability, accessibility, quality, and continuity of health care. Establishes the conditions by which an HMO is required to have an internal quality assurance program to monitor and evaluate its health care services. Authorizes the commissioner, by rule, to establish minimum standards and requirements for these programs. Sets forth the terms by which an HMO is required to record formal proceedings and maintain documentation of program activities; establish and maintain a physician review panel to assist in reviewing medical guidelines and to assist in determining the prescription drugs to be covered if a drug benefit is offered; ensure the use and maintenance of a patient record system; and establish a mechanism for the periodic reporting of program activities. Requires enrollees' clinical records to be confidential, and available to the commissioner for examination and review to determine compliance. Requires an HMO to establish a mechanism for periodic reporting of program activities to the governing body, providers, and staff. Requires that commissioner, with the advice and assistance of the Pharmacy Board, not later than 1/1/99, to adopt rules that require HMOs to use standardized pharmacy benefit cards. Adds new Section 38 entitled EFFECT OF DENTAL POINT-OF-SERVICE OPTION ON HEALTH MAINTENANCE ORGANIZATION which requires a dental HMO to offer a dental point-ofservice option to an employer, association, or other private group arrangement that employs or has 25 or more employees or members; the employee may accept or reject such coverage. Provides employee may be responsible for payment of premium. Sets out definitions of "pointof-service option" and "provider panel." Does not apply to HMOs with 10,000 or fewer enrollees. SECTION 27. Effective date of Section 38 is January 1, 1998. SECTION 28. Act applies only to an evidence of coverage that is delivered, issued for delivery, or renewed on or after January 1, 1998. An evidence of coverage that is delivered, issued for delivery, or renewed before January 1, 1998, is governed by the law as it existed immediately before effective of this Act. SECTION 29. Effective date: September 1, 1997. Except as provided in Sec. 27. _ SECTION 30. Emergency Clause COMPARISON OF SENATE ENGROSSED TO SUBSTITUTE Definitions of "health care" and "health care services." The committee substitute amends Article 20A.02, Insurance Code, to add "mental health" to the current definitions of "health care" and "health care services." Definition of "provider." The committee substitute amends Article 20A.02, Insurance Code, to add "registered optician" to the current definition of "provider." Definition of "physician." Adds medical school, or medical and dental unit as defined by Section 61.003, 61.501, or 74.601, Education Code. "Unauthorized HMO." The Senate engrossed version amended Article 20A.03, Insurance Code, by adding Subsections (e)-(g), to prohibit a person or provider from directly or indirectly performing any of the acts of a health maintenance organization (HMO), except in accordance with the HMO Act, and requires any person or provider in violation of this prohibition to be subject to all enforcement processes and procedures of an authorized insurer pursuant to Sections 3 and 3A, Article 1.14-1, Insurance Code. The Senate engrossed version also provides the Commissioner of Insurance (commissioner) shall have subpoena authority in accordance with Article 1.19-1, Insurance Code. The committee substitute amends Article 20A.03, Insurance Code, by adding (e), to prohibit a person, physician, or provider from performing the acts of an HMO except as provided and in accordance with specific authorization of the HMO Act or other law; by adding (f), to provide that a person, physician, or provider who performs any of the acts of an HMO without having first obtained a certificate of authority from the Texas Department of Insurance is subject to all enforcement processes and procedures of an unauthorized insurer under Articles 1.14-1 and 1.19-1, Insurance Code; by adding (g), to provide that subsection (e) and (f) do not apply to an activity exempt from regulation under Section 26(f) of the HMO Act; and by adding (h), to provide that the Commissioner may exercise subpoena authority in accordance with Article 1.19-1, Insurance Code, in implementing the HMO Act. Provision of emergency care services. The Senate engrossed version amended Article 20A.04(a), Insurance Code, to provide in paragraph (16), in part, that the HMO will provide documentation demonstrating that "the HMO will pay for emergency care services performed by non-network physicians or providers at the negotiated or usual and customary rate." The committee substitute deletes "at the negotiated or usual and customary rate." Out of network services. The Senate engrossed version Article 20A.09(a)(3), Insurance Code, to provide in paragraph (C), in part, that an evidence of coverage must contain a provision that, if medically necessary covered services are not available through network physicians or providers, the HMO must, on the request of a network physician or provider, within a reasonable period, allow referral to a non-network physician or provider and must fully reimburse the non-network physician or provider at the usual and customary or an agreed rate _ ." The committee substitute deletes "at the negotiated or usual and customary rate." Rehabilitation services and therapies. The committee substitute amended Article 20A.09(a), Insurance Code, to add paragraph (4) which requires that if an evidence of coverage provides benefits for rehabilitation services and therapies, the provision of services and therapies that, in the opinion of a physician, are medically necessary may not be denied, limited, or terminated by an HMO based on a determination that the rehabilitation services or therapy services are not resulting, or will not result in significant improvement in the enrollee's condition. Prompt payment to physicians and providers for covered services. The Senate engrossed version Amended 20A.09, Insurance Code, to require an HMO to pay physicians and providers not later than the 45th day after a claim is received with necessary documentation or within the time period specified by written agreement between the physician or provider and the HMO. The committee substitute changes this provision to require an HMO to pay physicians and providers not later than the 45th day after a claim is received with necessary documentation or "within a period, not to exceed 60 days, specified by a written agreement . . . ." Written description of health care plan terms and conditions. The committee substitute adds to the Senate engrossed version of the amendment to Article 20A.11, Insurance Code, by including a list in subsection (b) of information the written description must include. Access to member handbooks. The committee substitute changes subsection (b) of the Senate engrossed version of new Article 20A.11A, Insurance Code, by clarifying that the requirements apply to an approved nonprofit health corporation certified under Section 5.01(a), Medical Practice Act, that holds a certificate of authority issued by the commissioner. Information to enrollees and prospective enrollees: Medicare contracting HMO. The committee substitute adds a new Article 20A.11B, Insurance Code, to require a Medicare contracting HMO to provide a prospective enrollee with a written disclosure before the prospective enrollee is enrolled in the health care plan offered to Medicare recipients, the HMO must obtain the prospective enrollee's signature acknowledging receipt of the disclosure. Complaint and appeal system. The committee substitute revises the amendments to Article 20A.12, Insurance Code, relating to complaint and appeal system, set forth in the Senate engrossed version. The committee substitute adds language that requires each HMO to implement and maintain a system for the resolution of complaints as provided by Article 20A.12. The committee substitute deletes from the Senate engrossed version specific content and procedural requirements relating to the acknowledgment letter and complaint form sent to the enrollee. The committee substitute deletes from the Senate engrossed version provisions for the HMO to extend the time for resolution of a complaint for up to an additional 14 calendar days under certain circumstances. The committee substitute changes the requirement for resolution of complaints concerning emergencies or denials of continued stays for hospitalization from a requirement not to exceed 72 hours in the Senate engrossed version to a requirement not to exceed one business day. The committee substitute deletes from the Senate engrossed version specific content and procedural requirements relating to the acknowledgment letter sent to complainant enrollees upon receipt by the HMO of a request for appeal. The committee substitute deletes from the Senate engrossed version a provision that an enrollee complainant may agree otherwise to the requirement that the HMO provide documentation to be presented to the panel by the HMO staff not less than five working days before the meeting of the panel. The committee substitute deletes from the Senate engrossed version a provision that the complainant or designated representative may respond in writing to documentation provided by the HMO prior to the meeting of the appeal panel and the requirement that the complaint appeal panel must consider the written response in its deliberations. The committee substitute changes the requirement for investigation and resolution of appeals relating to ongoing emergencies or denials of continued stays for hospitalization from a requirement not to exceed 72 hours in the Senate engrossed version to a requirement not to exceed one business day. The committee substitute adds a requirement that a complainant is entitled to a copy of the record of the applicable complaint and any complaint proceeding, a requirement that each HMO maintain a complaint and appeal log regarding each complaint. The committee substitute deletes from the Senate engrossed version the following: "If any provision of Article 21.58A, Insurance Code (relating to regulation of utilization review), conflicts with any provision of Article 20A.12, Insurance Code, the provisions of Article 20A.12 shall prevail." Payments as inducements to limit medically necessary services. The Senate engrossed version of new subsection (l) of Article 20A.14, Insurance Code, relates to HMO payments to a physician or provider that act directly or indirectly as an inducement to limit medically necessary services. The committee substitute adds a sentence to clarify that subsection (l) does not prohibit the use of capitation as a method of payment. Psychotherapy and mental health therapy. The committee substitute adds subsection (m) to Article 20A.14, Insurance Code. This subsection prohibits an HMO from (1) requiring, as a condition of coverage or for any other reason, the observation of a psychotherapy session relating to or involving a covered person; or that a provider's process or progress notes be submitted to the HMO for review; (2) deny benefits for psychotherapy on the grounds that the patient refuses medication based on religious beliefs, or refuses medication for a period of time beyond the contract limits related to outpatient visits; or (3) deny benefits for mental health therapy on the grounds that the therapy is provided in a group session with family members or other individuals. Commissioner access to records. The committee substitute adds paragraph (4) to Article 20A.17(b), Insurance Code. Paragraph (4) authorizes the commissioner to examine and use the records of an HMO or physician or provider, including records of a quality of care assurance program and records of a medical peer review committee, as necessary to carry out the purposes of the HMO Act, including an enforcement action. Paragraph (4) also provides that the information is confidential and privileged and is not subject to the open records law or to subpoena except as necessary for the commissioner to enforce the HMO Act. Termination of physician or provider. The committee substitute changes new Article 20A.18A(b), Insurance Code, of the Senate engrossed version by adding a time period requirement for review of the proposed termination of a physician or provider by an advisory review panel. The committee substitute provides that on request and before the effective date of the termination, but within a period not to exceed 60 days, a physician or provider shall be entitled to a review of the HMO's proposed termination by an advisory review panel. Continuity of ongoing treatment for enrollees with special circumstances. The committee substitute adds a requirement to subsection (c) of Article 20A.18A, Insurance Code, of the Senate engrossed version, to extend the obligation of the HMO to reimburse, beyond the 90th day after the effective date of termination of the physician or provider, for continuing treatment of an enrollee who at the time of termination is being treated for a life-threatening illness or condition. Notification to enrollees of impending termination of physician or provider. The Senate engrossed version adds Article 20A.18A(d), Insurance Code, to provide, in part, that the "HMO may not notify patients of the physician's or provider's deselection until the effective date of the termination or the time a review panel makes a formal recommendation." The committee substitute substitutes the following language in subsection (d) of Article 20A.18A, Insurance Code, "an insurer that has complied with the provision of Section 18A(b) may give reasonable advance notice to an enrollee of the impending termination from the plan of physician or provider who is currently treating the enrollee." Initiation of capitated payments. The Senate engrossed version adds Article 20A.18A(e)(1), Insurance Code, to require an HMO to begin payment of capitated amounts to physicians and providers no later than the 90th day following the date an enrollee has selected or has been assigned a primary care physician or provider. The committee substitute substitutes the "30th" day for the "90th" day. Assignment of primary care physician or provider. The Senate engrossed version adds Article 20A.18A(e)(2), Insurance Code, to provide that an HMO may assign an enrollee to a primary care physician or provider. The committee substitute provides that the HMO shall assign an enrollee to a primary care physician or provider not later than the 30th day after the date of the enrollment. In addition, the committee substitute adds a provision that the HMO must inform an enrollee of certain information concerning the primary care physician or provider to whom the enrollee has been assigned. Definition of "termination." The Senate engrossed version does not include a definition of "termination." The committee substitute defines "termination" in Article 20A.18A(j), Insurance Code, to include deselection of a physician or provider from an HMO or the failure or refusal of an HMO to renew a contract entered into with a physician or provider. Enrollee clinical records. The Senate engrossed version adds Article 20A.37(f), Insurance Code, to provide that enrollee clinical records shall be available to the commissioner for examination and review to determine compliance and that the records shall be confidential and not subject to the open records law. The committee substitute adds that the records are confidential and privileged, and are not subject to the open records law, or to subpoena, except to the extent necessary to enable the commissioner to enforce Article 20A.37. Standardized pharmacy benefit cards. The committee substitute adds subsection (h) to new Article 20A.37, Insurance Code, by requiring an HMO to use standardized pharmacy benefit cards. Dental point of service requirement. The committee substitute adds Article 20A.38, Insurance Code, to mandate a dental point of service plan be offered to employers with 25 or more employees.