By Maxey H.B. No. 1434
75R6496 DLF-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to underwriting guidelines used by certain health benefit
1-3 plans.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Article 1.24D, Insurance Code, is amended to read
1-6 as follows:
1-7 Art. 1.24D. CONFIDENTIALITY OF UNDERWRITING GUIDELINES
1-8 Sec. 1. DEFINITION. In this article, "health benefit plan"
1-9 means a plan that:
1-10 (1) provides benefits for medical or surgical expenses
1-11 incurred as a result of a health condition, accident, or sickness,
1-12 including an individual, group, blanket, or franchise insurance
1-13 policy or insurance agreement, a group hospital service contract,
1-14 or an individual or group evidence of coverage that is offered by:
1-15 (A) an insurance company;
1-16 (B) a group hospital service corporation
1-17 operating under Chapter 20 of this code;
1-18 (C) a fraternal benefit society operating under
1-19 Chapter 10 of this code;
1-20 (D) a stipulated premium insurance company
1-21 operating under Chapter 22 of this code; or
1-22 (E) a health maintenance organization operating
1-23 under the Texas Health Maintenance Organization Act (Chapter 20A,
1-24 Vernon's Texas Insurance Code);
2-1 (2) is offered under Chapter 26 of this code; or
2-2 (3) is offered by an approved nonprofit health
2-3 corporation that is certified under Section 5.01(a), Medical
2-4 Practice Act (Article 4495b, Vernon's Texas Civil Statutes), and
2-5 that holds a certificate of authority issued by the commissioner
2-6 under Article 21.52F of this code.
2-7 Sec. 2. REQUEST FOR UNDERWRITING GUIDELINES AND RELATED
2-8 INFORMATION; CONFIDENTIALITY. (a) The department or the office of
2-9 public insurance counsel may request and receive copies of an
2-10 insurer's underwriting guidelines.
2-11 (b) The department shall request copies of underwriting
2-12 guidelines used by insurers and other entities in writing health
2-13 benefit plans. The insurer or other entity shall submit the
2-14 requested guidelines to the department, together with statistical
2-15 data supporting the use of each guideline in the form requested by
2-16 the department.
2-17 (c) Except as provided by Subsection (d) of this section,
2-18 underwriting [Underwriting] guidelines are confidential and the
2-19 department or the office of public insurance counsel may not make
2-20 the guidelines available to the public.
2-21 (d) The [, provided, however, that the] department or the
2-22 office of public insurance counsel may disclose a summary of the
2-23 underwriting guidelines. The department shall prepare and make
2-24 available to the public a summary of the information submitted to
2-25 the department under Subsection (b) of this section. A summary
2-26 prepared under this subsection may [in a manner that does] not
2-27 directly or indirectly identify the insurer who provided the
3-1 guidelines and information.
3-2 Sec. 3. VIOLATIONS OF CODE. [(b)] This article [law] does
3-3 not preclude the use of underwriting guidelines or other
3-4 information submitted under this article as evidence to prosecute a
3-5 violation of this code. If a guideline or related information is
3-6 [guidelines are] used to prosecute a violation of the law, all
3-7 copies of the guideline or information [those guidelines] shall be
3-8 presumed confidential and subject to a protective order until all
3-9 appeals on the case have been exhausted. After the exhaustion of
3-10 all appeals, if an insurer is found to have violated this code, the
3-11 copies of the underwriting guideline or related information that
3-12 was [guidelines that were] used as evidence of the violation shall
3-13 no longer be presumed confidential.
3-14 Sec. 4. ACCESS TO GUIDELINES AND RELATED INFORMATION
3-15 SUBMITTED TO DEPARTMENT. [(c)] When underwriting [such]
3-16 guidelines and related information are furnished to the department
3-17 or the office of public insurance counsel under this article, only
3-18 those persons within the department or the office of public
3-19 insurance counsel with a need to know will have access to such
3-20 guidelines and information. The department and the office of
3-21 public insurance counsel shall establish internal control systems
3-22 to limit such access and keep a record thereof.
3-23 Sec. 5. PENALTY. [(d)] Violations of the provisions of
3-24 this article shall be considered as violation of the open records
3-25 law, Chapter 552, Government Code [424, Acts of the 63rd
3-26 Legislature, Regular Session, 1973 (Article 6252-17a, Vernon's
3-27 Texas Civil Statutes)].
4-1 SECTION 2. The Texas Department of Insurance shall prepare
4-2 the summary of the information submitted to the department under
4-3 Section 2(b), Article 1.24D, Insurance Code, as amended by this
4-4 Act, not later than September 1, 1998.
4-5 SECTION 3. The importance of this legislation and the
4-6 crowded condition of the calendars in both houses create an
4-7 emergency and an imperative public necessity that the
4-8 constitutional rule requiring bills to be read on three several
4-9 days in each house be suspended, and this rule is hereby suspended,
4-10 and that this Act take effect and be in force from and after its
4-11 passage, and it is so enacted.