By: Cain, Harris, Nelson S.B. No. 383
Sibley, Madla
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the regulation of preferred provider benefit plans.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. Chapter 3, Insurance Code, is amended by adding
1-4 Article 3.70-3C to read as follows:
1-5 Art. 3.70-3C. PREFERRED PROVIDER BENEFIT PLANS
1-6 Sec. 1. DEFINITIONS. In this article:
1-7 (1) "Emergency care" means health care services
1-8 provided in a hospital emergency facility or comparable facility to
1-9 evaluate and stabilize medical conditions of a recent onset and
1-10 severity, including but not limited to severe pain, that would lead
1-11 a prudent layperson, possessing an average knowledge of medicine
1-12 and health, to believe that the person's condition, sickness, or
1-13 injury is of such a nature that failure to get immediate medical
1-14 care could result in:
1-15 (A) placing the patient's health in serious
1-16 jeopardy;
1-17 (B) serious impairment to bodily functions;
1-18 (C) serious dysfunction of any bodily organ or
1-19 part;
1-20 (D) serious disfigurement; or
1-21 (E) in the case of a pregnant woman, serious
1-22 jeopardy to the health of the fetus.
1-23 (2) "Health insurance policy" means a group or
2-1 individual insurance policy, certificate, or contract providing
2-2 benefits for medical or surgical expenses incurred as a result of
2-3 an accident or sickness.
2-4 (3) "Health care provider" or "provider" means any
2-5 practitioner, institutional provider, or other person or
2-6 organization that furnishes health care services and that is
2-7 licensed or otherwise authorized to practice in this state, other
2-8 than a physician.
2-9 (4) "Hospital" means a licensed public or private
2-10 institution as defined in Chapter 241, Health and Safety Code, or
2-11 in Subtitle C, Title 7, Health and Safety Code.
2-12 (5) "Institutional provider" means a hospital, nursing
2-13 home, or any other medical or health-related service facility
2-14 caring for the sick or injured or providing care for other coverage
2-15 which may be provided in a health insurance policy.
2-16 (6) "Insurer" means any life, health, and accident;
2-17 health and accident; or health insurance company or company
2-18 operating pursuant to Chapter 3, 10, 20, 22, or 26 of this code
2-19 authorized to issue, deliver, or issue for delivery in this state
2-20 health insurance policies, certificates, or contracts.
2-21 (7) "Life threatening" means a disease or condition
2-22 where the likelihood of death is high unless the course of the
2-23 disease or condition is interrupted.
2-24 (8) "Physician" means anyone licensed to practice
2-25 medicine in the State of Texas;
3-1 (9) "Practitioner" means a person who practices a
3-2 healing art and is a practitioner specified in Section 2(B),
3-3 Chapter 397, Acts of the 54th Legislature, 1955 (Article 3.70-2,
3-4 Vernon's Texas Insurance Code), or Article 21.52 of this code.
3-5 (10) "Preferred provider" means a physician,
3-6 practitioner, hospital, institutional provider, or health care
3-7 provider, or an organization of physicians or health care
3-8 providers, who contracts with an insurer to provide medical care or
3-9 health care to insureds covered by a health insurance policy,
3-10 certificate, or contract.
3-11 (11) "Prospective insured" means:
3-12 (A) for group coverage, an individual, including
3-13 dependents, eligible for coverage under a health insurance policy
3-14 issued to the group; or
3-15 (B) for individual coverage, an individual,
3-16 including dependents, eligible for coverage who has expressed an
3-17 interest in purchasing an individual health insurance policy.
3-18 (12) "Quality assessment" means a mechanism which is
3-19 in place or put into place and utilized by an insurer for the
3-20 purposes of evaluating, monitoring, or improving the quality and
3-21 effectiveness of the medical care delivered by physicians or health
3-22 care providers to persons covered by a health insurance policy to
3-23 insure that the care delivered is consistent with that delivered by
3-24 an ordinary, reasonable, prudent physician or health care provider
3-25 under the same or similar circumstances.
4-1 (13) "Service area" means a geographic area or areas
4-2 set forth in the health insurance policy or preferred provider
4-3 contract in which a network of preferred providers is offered and
4-4 available.
4-5 Sec. 2. APPLICATION. This article applies to any preferred
4-6 provider benefit plan in which an insurer provides, through its
4-7 health insurance policy, for the payment of a level of coverage
4-8 which is different from the basic level of coverage provided by the
4-9 health insurance policy if the insured uses a preferred provider.
4-10 This article does not apply to provisions for dental care benefits
4-11 in any health insurance policy.
4-12 Sec. 3. CONTRACTING REQUIREMENTS. (a) A health insurance
4-13 policy that includes different benefits from the basic level of
4-14 coverage for the use of preferred providers shall not be considered
4-15 unjust under Article 3.42 of this code, or unfair discrimination
4-16 under Article 21.21-6, as added by Chapter 415, Acts of the 74th
4-17 Legislature, 1995, or Article 21.21-8 of this code or to violate
4-18 Subsection (B), Section 2, Chapter 397, Acts of the 54th
4-19 Legislature, 1955 (Article 3.70-2, Vernon's Texas Insurance Code),
4-20 or Article 21.52 of this code, if it meets the requirements of this
4-21 section.
4-22 (b)(1) Physicians, practitioners, institutional providers,
4-23 and health care providers other than physicians, practitioners, and
4-24 institutional providers, if such other health care providers are
4-25 included by the insurer as preferred providers, licensed to treat
5-1 injuries or illnesses or to provide services covered by the health
5-2 insurance policy that comply with the terms and conditions
5-3 established by the insurer for designation as preferred providers
5-4 may apply for and shall be afforded a fair, reasonable, and
5-5 equivalent opportunity to become preferred providers. Such
5-6 designation shall not be unreasonably withheld.
5-7 (2) If a designation as a preferred provider is
5-8 withheld relating to a physician or practitioner, the insurer shall
5-9 provide a reasonable review mechanism that incorporates, in an
5-10 advisory role only, a review panel. Any recommendation of the
5-11 panel shall be provided on request to the affected physician or
5-12 practitioner. In the event of an insurer determination contrary to
5-13 any recommendation of the panel, a written explanation of the
5-14 insurer's determination shall also be provided on request to the
5-15 affected physician or practitioner.
5-16 (3) The review panel shall be composed of not less
5-17 than three individuals selected by the insurer from a list of the
5-18 physicians or practitioners contracting with the insurer and shall
5-19 include one member who is a physician or practitioner in the same
5-20 or similar specialty as the affected physician or practitioner, if
5-21 available. The list of physicians or practitioners is to be
5-22 provided to the insurer by the physicians or practitioners
5-23 contracting with the insurer in the applicable service area.
5-24 (4) The insurer must give a physician or health care
5-25 provider not designated on initial application written reasons for
6-1 denial of the designation; however, unless otherwise limited by
6-2 this code, this section does not prohibit an insurer from rejecting
6-3 an application from a physician or health care provider based on a
6-4 determination that the preferred provider benefit plan has
6-5 sufficient qualified providers.
6-6 (c) Any insurer, when sponsoring a preferred provider
6-7 benefit plan, shall immediately notify, by publication or in
6-8 writing to each physician and practitioner, all physicians and
6-9 practitioners in the geographic area covered by the plan of its
6-10 intent to offer such a plan and of the opportunity to participate.
6-11 Such notice and opportunity shall be provided on a yearly basis
6-12 thereafter to noncontracting physicians and practitioners in the
6-13 geographic area covered by the plan. The insurer shall on request
6-14 make available to any physician or health care provider information
6-15 concerning the application process and qualification requirements
6-16 for participation as a provider in the plan.
6-17 (d) Insurers which market a preferred provider benefit plan
6-18 must contract with physicians and health care providers to assure
6-19 that all medical and health care services and items contained in
6-20 the package of benefits for which coverage is provided, including
6-21 treatment of illnesses and injuries, will be provided under the
6-22 health insurance policy in a manner assuring both availability and
6-23 accessibility of adequate personnel, specialty care, and
6-24 facilities.
6-25 (e) Each insured patient shall have the right to treatment
7-1 and diagnostic techniques as prescribed by the physician or other
7-2 health care provider included in the preferred provider benefit
7-3 plan.
7-4 (f) Every contract by an insurer with a physician,
7-5 physicians group, or practitioner shall have a mechanism for the
7-6 resolution of complaints initiated by the insured, physicians,
7-7 physicians groups, or practitioners. Such mechanism shall provide
7-8 for reasonable due process which includes, in an advisory role
7-9 only, a review panel selected in the manner described in Subsection
7-10 (b)(3) of this section.
7-11 (g) Before terminating a contract with a preferred provider,
7-12 the insurer shall provide written reasons for the termination.
7-13 Prior to termination of a physician or practitioner, the insurer
7-14 shall, on request, provide a reasonable review mechanism that
7-15 incorporates, in an advisory role only, a review panel selected in
7-16 the manner described in Subsection (b)(3) of this section, except
7-17 in cases in which there is imminent harm to a patient's health or
7-18 an action by a state medical or other physician licensing board or
7-19 other government agency that effectively impairs a physician's or
7-20 practitioner's ability to practice medicine or in cases of fraud or
7-21 malfeasance. Any recommendation of the panel shall be provided to
7-22 the affected physician or practitioner. In the event of an insurer
7-23 determination contrary to any recommendation of the panel, a
7-24 written explanation of the insurer's determination shall also be
7-25 provided on request to the affected physician or practitioner. On
8-1 request, an expedited review process shall be made available to a
8-2 physician or practitioner who is being terminated. The expedited
8-3 review process shall comply with rules established by the
8-4 commissioner.
8-5 (h) An insurer that conducts, uses, or relies on economic
8-6 profiling to admit or terminate physicians or health care providers
8-7 shall make available to a physician or health care provider on
8-8 request the economic profile of that physician or health care
8-9 provider, including the written criteria by which the physician or
8-10 health care provider's performance is to be measured. An economic
8-11 profile must be adjusted to recognize the characteristics of a
8-12 physician's or health care provider's practice that may account for
8-13 variations from expected costs.
8-14 (i) No insurer shall engage in quality assessment except
8-15 through a panel of not less than three physicians selected by the
8-16 insurer from among a list of physicians contracting with the
8-17 insurer, which list is to be provided by the physicians contracting
8-18 with the insurer in the applicable service area.
8-19 (j) A preferred provider contract may not require any health
8-20 care provider, physician, or physicians group to execute hold
8-21 harmless clauses in order to shift the insurer's tort liability
8-22 resulting from acts or omissions of the insurer to the preferred
8-23 provider.
8-24 (k) A preferred provider contract must include a provision
8-25 by which the physician or health care provider agrees that if the
9-1 preferred provider is compensated on a discounted fee basis, the
9-2 insured may be billed only on the discounted fee and not the full
9-3 charge.
9-4 (l) An insurer may enter into an agreement with a preferred
9-5 provider organization for the purposes of offering a network of
9-6 preferred providers. The agreement may provide that the notice
9-7 and other insurer requirements of this section may be complied with
9-8 by either the insurer or the preferred provider organization on the
9-9 insurer's behalf. If an insurer enters into an agreement with a
9-10 preferred provider organization under this section, it is the
9-11 insurer's responsibility to meet the requirements of this article
9-12 or to assure that the requirements are met. All preferred provider
9-13 insurance benefit plans offered in this state shall comply with the
9-14 requirements of this article.
9-15 Sec. 4. CONTINUITY OF CARE. (a) The insurer shall
9-16 establish reasonable procedures for assuring a transition of
9-17 insureds to physicians or health care providers and for continuity
9-18 of treatment. Insurers shall provide, subject to Section 6(e) of
9-19 this article, reasonable advance notice to the insured of the
9-20 impending termination from the plan of a physician or health care
9-21 provider who is currently treating the insured and in the event of
9-22 termination of a preferred provider's participation in the plan
9-23 shall make available to the insured a current listing of preferred
9-24 providers.
9-25 (b) Each contract between an insurer and a physician or
10-1 health care provider must provide that the termination of a
10-2 preferred provider's participation in the plan, except for reason
10-3 of medical competence or professional behavior, shall not release
10-4 the physician or health care provider from the generally recognized
10-5 obligation to treat the insured and cooperate in arranging for
10-6 appropriate referrals; nor does it release the insurer from the
10-7 obligation to reimburse the physician or health care provider or,
10-8 if applicable, the insured at the same preferred provider rate if,
10-9 at the time of the preferred provider's termination, the insured
10-10 has special circumstances such as a disability, acute condition, or
10-11 life-threatening illness or is past the 24th week of pregnancy and
10-12 is receiving treatment in accordance with the dictates of medical
10-13 prudence.
10-14 (c) For purposes of Subsection (b) of this section, "special
10-15 circumstances" means a condition such that the treating physician
10-16 or health care provider reasonably believes that discontinuing care
10-17 by the treating physician or provider could cause harm to the
10-18 patient. Special circumstances shall be identified by the treating
10-19 physician or health care provider, who must request that the
10-20 insured be permitted to continue treatment under the physician's or
10-21 provider's care and agree not to seek payment from the patient of
10-22 any amounts for which the insured would not be responsible if the
10-23 physician or provider were still a preferred provider.
10-24 (d) Contracts between an insurer, physicians, and health
10-25 care providers shall include procedures for resolving disputes
11-1 regarding the necessity for continued treatment by a physician or
11-2 provider.
11-3 (e) This section does not extend the obligation of the
11-4 insurer to reimburse, at the preferred provider level of coverage,
11-5 the terminated physician or health care provider or, if applicable,
11-6 the insured for ongoing treatment of an insured after the 90th day
11-7 from the effective date of the termination. However, the
11-8 obligation of the insurer to reimburse, at the preferred provider
11-9 level of coverage, the terminated physician or health care provider
11-10 or, if applicable, the insured who at the time of the termination
11-11 is past the 24th week of pregnancy, extends through delivery of the
11-12 child, immediate post-partum care, and the follow-up checkup within
11-13 the first six weeks of delivery.
11-14 Sec. 5. EMERGENCY CARE PROVISIONS. If the insured cannot
11-15 reasonably reach a preferred provider, an insurer shall provide
11-16 reimbursement for the following emergency care services at the
11-17 preferred level of benefits until the insured can reasonably be
11-18 expected to transfer to a preferred provider:
11-19 (1) any medical screening examination or other
11-20 evaluation required by state or federal law to be provided in the
11-21 emergency facility of a hospital which is necessary to determine
11-22 whether a medical emergency condition exists;
11-23 (2) necessary emergency care services including the
11-24 treatment and stabilization of an emergency medical condition; and
11-25 (3) services originating in a hospital emergency
12-1 facility following treatment or stabilization of an emergency
12-2 medical condition.
12-3 Sec. 6. MANDATORY DISCLOSURE REQUIREMENTS. (a) All health
12-4 insurance policies, health benefit plan certificates, endorsements,
12-5 amendments, applications, or riders shall be written in plain
12-6 language, must be in a readable and understandable format, and must
12-7 comply with all applicable requirements relating to minimum
12-8 readability requirements.
12-9 (b) The insurer shall provide to a current or prospective
12-10 group contract holder or current or prospective insured on request
12-11 an accurate written description of the terms and conditions of the
12-12 policy to allow the current or prospective group contract holder or
12-13 current or prospective insured to make comparisons and informed
12-14 decisions before selecting among health care plans. The written
12-15 description must be in a readable and understandable format as
12-16 prescribed by the commissioner and must include a current list of
12-17 preferred providers. The insurer may provide its handbook to
12-18 satisfy this requirement provided the handbook's content is
12-19 substantively similar to and achieves the same level of disclosure
12-20 as the written description prescribed by the commissioner and the
12-21 current list of physicians and health care providers is provided.
12-22 (c) A current list of preferred providers shall be provided
12-23 to all insureds no less than annually.
12-24 (d) No insurer, or agent or representative of an insurer,
12-25 may cause or permit the use or distribution of prospective insured
13-1 information which is untrue or misleading.
13-2 (e)(1) If a physician or practitioner is terminated for
13-3 reasons other than at the preferred provider's request, an insurer
13-4 shall not notify enrollees of the termination until the effective
13-5 date of the termination or at such time as a review panel makes a
13-6 formal recommendation regarding the termination, whichever is
13-7 later.
13-8 (2) If a physician or provider voluntarily terminates
13-9 the physician's or provider's relationship with an insurer, the
13-10 physician or provider shall provide reasonable notice to enrollees
13-11 under the physician's or provider's care. The insurer shall
13-12 provide assistance to the physician or provider in assuring that
13-13 the notice requirements of this subdivision are met.
13-14 (3) If a physician or practitioner is terminated for
13-15 reasons related to imminent harm, an insurer may notify enrollees
13-16 immediately.
13-17 Sec. 7. PROHIBITED PRACTICES. (a) No insurer shall engage
13-18 in any retaliatory action against an insured, including
13-19 cancellation of or refusal to renew a policy, because the insured,
13-20 or a person acting on behalf of the insured, has filed a complaint
13-21 against the insurer or against a preferred provider or has appealed
13-22 a decision of the insurer.
13-23 (b) No insurer shall engage in any retaliatory action
13-24 against a physician or health care provider, including termination
13-25 of or refusal to renew a contract, because the physician or
14-1 provider has, on behalf of an insured, reasonably filed a complaint
14-2 against the insurer or has appealed a decision of the insurer.
14-3 (c)(1) An insurer shall not, as a condition of a contract
14-4 with a physician or health care provider or in any other manner,
14-5 prohibit, attempt to prohibit, nor discourage a physician or
14-6 provider from:
14-7 (A) discussing with or communicating to a
14-8 current, prospective, or former patient, or a party designated by a
14-9 patient, information or opinions regarding that patient's health
14-10 care, including but not limited to the patient's medical condition
14-11 or treatment options; or
14-12 (B) discussing with or communicating in good
14-13 faith to a current, prospective, or former patient, or a party
14-14 designated by a patient, information or opinions regarding the
14-15 provisions, terms, requirements, or services of the health care
14-16 plan as they relate to the medical needs of the patient.
14-17 (2) An insurer shall not in any way penalize,
14-18 terminate, nor refuse to compensate for covered services a
14-19 physician or provider for discussing or communicating with a
14-20 current, prospective, or former patient, or a party designated by a
14-21 patient, pursuant to this section.
14-22 (d) An insurer shall not use any financial incentive or make
14-23 payment to a physician or health care provider which acts directly
14-24 or indirectly as an inducement to limit medically necessary
14-25 services.
15-1 Sec. 8. AVAILABILITY OF PREFERRED PROVIDERS. (a) Any
15-2 insurer offering a preferred provider benefit plan must ensure that
15-3 both preferred provider benefits and basic level benefits are
15-4 reasonably available to all insureds within a designated service
15-5 area.
15-6 (b) If services are not available through preferred
15-7 providers within the service area, nonpreferred providers shall be
15-8 reimbursed at the same percentage level of reimbursement as the
15-9 preferred providers would have been reimbursed had the insured been
15-10 treated by them. Nothing in this subsection requires reimbursement
15-11 at a preferred level of coverage solely because an insured resides
15-12 out of the service area and chooses to receive services from
15-13 providers other than preferred providers for the insured's own
15-14 convenience.
15-15 Sec. 9. RULEMAKING AUTHORITY. The commissioner shall adopt
15-16 rules as necessary to implement the provisions of this article and
15-17 to ensure reasonable accessibility and availability of preferred
15-18 provider and basic level benefits to Texas citizens.
15-19 SECTION 2. The requirements of Article 3.70-3C, Insurance
15-20 Code, as added by Section 1 of this Act, apply to any insurance
15-21 policy or contract issued, delivered, or renewed on or after the
15-22 effective date of this Act.
15-23 SECTION 3. The importance of this legislation and the
15-24 crowded condition of the calendars in both houses create an
15-25 emergency and an imperative public necessity that the
16-1 constitutional rule requiring bills to be read on three several
16-2 days in each house be suspended, and this rule is hereby suspended,
16-3 and that this Act take effect and be in force from and after its
16-4 passage, and it is so enacted.