By: Cain, Harris, Nelson S.B. No. 383
Sibley, Madla
97S0207/2
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 to evaluate and treat
1-9 medical conditions of a recent onset and severity, including but
1-10 not limited to severe pain that would lead a prudent layperson,
1-11 possessing an average knowledge of medicine and health, to believe
1-12 that the person's condition, sickness, or injury is of such a
1-13 nature that failure to get immediate medical care could result in:
1-14 (A) placing the patient's health in serious
1-15 jeopardy;
1-16 (B) serious impairment to bodily functions;
1-17 (C) serious dysfunction of any bodily organ or
1-18 part;
1-19 (D) serious disfigurement; or
1-20 (E) in the case of a pregnant woman, serious
1-21 jeopardy to the health of the fetus.
1-22 (2) "Health insurance policy" means a group or
1-23 individual insurance policy, certificate, or contract providing
2-1 benefits for medical or surgical expenses incurred as a result of
2-2 an accident or sickness.
2-3 (3) "Health care provider" or "provider" means any
2-4 practitioner other than a physician; an institutional provider; or
2-5 any other person or organization that furnishes health care
2-6 services and that is licensed or otherwise authorized to practice
2-7 in this state.
2-8 (4) "Hospital" means a licensed public or private
2-9 institution as defined in Chapter 241, Health and Safety Code, or
2-10 in Subtitle C, Title 7, Health and Safety Code.
2-11 (5) "Institutional provider" means a hospital, nursing
2-12 home, or any other medical or health-related service facility
2-13 caring for the sick or injured or providing care for other coverage
2-14 which may be provided in a health insurance policy.
2-15 (6) "Insurer" means any life, health, and accident;
2-16 health and accident; or health insurance company or company
2-17 operating pursuant to Chapter 3, 10, 20, 22, or 26 of this code
2-18 authorized to issue, deliver, or issue for delivery in this state
2-19 health insurance policies, certificates, or contracts.
2-20 (7) "Physician" means anyone licensed to practice
2-21 medicine in the State of Texas;
2-22 (8) "Practitioner" means a person who practices a
2-23 healing art and is a practitioner specified in Section 2(B),
2-24 Chapter 397, Acts of the 54th Legislature, 1955 (Article 3.70-2,
2-25 Vernon's Texas Insurance Code), or Article 21.52 of this code.
3-1 (9) "Preferred provider" means a physician,
3-2 practitioner, hospital, institutional provider, or health care
3-3 provider, or an organization of physicians or health care
3-4 providers, who contracts with an insurer to provide medical care or
3-5 health care to insureds covered by a health insurance policy,
3-6 certificate, or contract.
3-7 (10) "Quality assessment" means a mechanism which is
3-8 in place or put into place and utilized by an insurer for the
3-9 purposes of evaluating, monitoring, or improving the quality and
3-10 effectiveness of the medical care delivered by physicians or health
3-11 care providers to persons covered by a health insurance policy to
3-12 insure that the care delivered is consistent with that delivered by
3-13 an ordinary, reasonable, prudent physician or health care provider
3-14 under the same or similar circumstances.
3-15 (11) "Service area" means a geographic area or areas
3-16 set forth in the health insurance policy or preferred provider
3-17 contract in which a network of preferred providers is offered and
3-18 available.
3-19 Sec. 2. APPLICATION. This article applies to any preferred
3-20 provider benefit plan in which an insurer provides, through its
3-21 health insurance policy, for the payment of a level of coverage
3-22 which is different from the basic level of coverage provided by the
3-23 health insurance policy if the insured uses a preferred provider.
3-24 This article does not apply to provisions for dental care benefits
3-25 in any health insurance policy.
4-1 Sec. 3. CONTRACTING REQUIREMENTS. (a) A health insurance
4-2 policy that includes different benefits from the basic level of
4-3 coverage for the use of preferred providers shall not be considered
4-4 unjust under this code if it meets the requirements of this
4-5 section.
4-6 (b)(1) Physicians, practitioners, institutional providers,
4-7 and health care providers other than physicians, practitioners, and
4-8 institutional providers, if such other health care providers are
4-9 included by the insurer as preferred providers, licensed to treat
4-10 injuries or illnesses or to provide services covered by the health
4-11 insurance policy that comply with the terms and conditions
4-12 established by the insurer for designation as preferred providers
4-13 may apply for and shall be afforded a fair, reasonable, and
4-14 equivalent opportunity to become preferred providers. Such
4-15 designation shall not be unreasonably withheld.
4-16 (2) If a designation as a preferred provider is
4-17 withheld relating to a physician or practitioner, the insurer shall
4-18 provide a reasonable review mechanism that incorporates, in an
4-19 advisory role only, a review panel. Any recommendation of the
4-20 panel shall be provided on request to the affected physician or
4-21 practitioner. In the event of an insurer determination contrary to
4-22 any recommendation of the panel, a written explanation of the
4-23 insurer's determination shall also be provided on request to the
4-24 affected physician or practitioner.
4-25 (3) The review panel shall be composed of not less
5-1 than three individuals selected by the insurer from a list of the
5-2 physicians or practitioners contracting with the insurer and shall
5-3 include one member who is a physician or practitioner in the same
5-4 or similar specialty as the affected physician or practitioner, if
5-5 available. The list of physicians or practitioners is to be
5-6 provided to the insurer by the physicians or practitioners
5-7 contracting with the insurer in the applicable service area.
5-8 (4) The insurer must give a physician or health care
5-9 provider not designated on initial application written reasons for
5-10 denial of the designation; however, unless otherwise limited by
5-11 this code, this section does not prohibit an insurer from rejecting
5-12 an application from a physician or health care provider based on a
5-13 determination that the preferred provider benefit plan has
5-14 sufficient qualified providers.
5-15 (c) Any insurer, when sponsoring a preferred provider
5-16 benefit plan, shall immediately notify, by publication or in
5-17 writing to each physician and practitioner, all physicians and
5-18 practitioners in the geographic area covered by the plan of its
5-19 intent to offer such a plan and of the opportunity to participate.
5-20 Such notice and opportunity shall be provided on a yearly basis
5-21 thereafter to noncontracting physicians and practitioners in the
5-22 geographic area covered by the plan. The insurer shall on request
5-23 make available to any physician or health care provider information
5-24 concerning the application process and qualification requirements
5-25 for participation as a provider in the plan.
6-1 (d) Insurers which market a preferred provider benefit plan
6-2 must contract with physicians and health care providers to assure
6-3 that all medical and health care services and items contained in
6-4 the package of benefits for which coverage is provided, including
6-5 treatment of illnesses and injuries, will be provided under the
6-6 health insurance policy in a manner assuring both availability and
6-7 accessibility of adequate personnel, specialty care, and
6-8 facilities.
6-9 (e) Each insured patient shall have the right to treatment
6-10 and diagnostic techniques as prescribed by the physician or other
6-11 health care provider included in the preferred provider benefit
6-12 plan.
6-13 (f) Every contract by an insurer with a physician,
6-14 physicians group, or practitioner shall have a mechanism for the
6-15 resolution of complaints initiated by the insured, physicians,
6-16 physicians groups, or practitioners. Such mechanism shall provide
6-17 for reasonable due process which includes, in an advisory role
6-18 only, a review panel selected in the manner described in Subsection
6-19 (b)(3) of this section.
6-20 (g) Before terminating a contract with a preferred provider,
6-21 the insurer shall provide written reasons for the termination.
6-22 Prior to termination of a physician or practitioner, the insurer
6-23 shall, on request, provide a reasonable review mechanism that
6-24 incorporates, in an advisory role only, a review panel selected in
6-25 the manner described in Subsection (b)(3) of this section, except
7-1 in cases in which there is imminent harm to a patient's health or
7-2 an action by a state medical or other physician licensing board or
7-3 other government agency that effectively impairs a physician's or
7-4 practitioner's ability to practice medicine or in cases of fraud or
7-5 malfeasance. Any recommendation of the panel shall be provided to
7-6 the affected physician or practitioner. In the event of an insurer
7-7 determination contrary to any recommendation of the panel, a
7-8 written explanation of the insurer's determination shall also be
7-9 provided on request to the affected physician or practitioner. On
7-10 request, an expedited review process shall be made available to a
7-11 physician or practitioner who is being terminated. The expedited
7-12 review process shall comply with rules established by the
7-13 commissioner.
7-14 (h) An insurer that conducts, uses, or relies on economic
7-15 profiling to admit or terminate physicians or health care providers
7-16 shall make available to a physician or health care provider on
7-17 request the economic profile of that physician or health care
7-18 provider, including the written criteria by which the physician or
7-19 health care provider's performance is to be measured. An economic
7-20 profile must be adjusted to recognize the characteristics of a
7-21 physician's or health care provider's practice that may account for
7-22 variations from expected costs.
7-23 (i) No insurer shall engage in quality assessment except
7-24 through a panel of not less than three physicians selected by the
7-25 insurer from among a list of physicians contracting with the
8-1 insurer, which list is to be provided by the physicians contracting
8-2 with the insurer in the applicable service area.
8-3 (j) A preferred provider contract may not require any health
8-4 care provider, physician, or physicians group to execute hold
8-5 harmless clauses in order to shift the insurer's tort liability
8-6 resulting from acts or omissions of the insurer to the preferred
8-7 provider.
8-8 (k) A contract between an insurer and a preferred provider
8-9 may not, directly or indirectly, prohibit or attempt to prohibit:
8-10 (1) the preferred provider with whom the insurer has
8-11 contracted or proposes to contract from contracting with other
8-12 insurers, health maintenance organizations, or other health care
8-13 benefit plans; or
8-14 (2) the insurer with whom the preferred provider has
8-15 contracted or proposes to contract from contracting with other
8-16 preferred providers.
8-17 (l) A preferred provider contract must include a provision
8-18 by which the physician or health care provider agrees that if the
8-19 preferred provider is compensated on a discounted fee basis, the
8-20 insured may be billed only on the discounted fee and not the full
8-21 charge.
8-22 (m) An insurer may enter into an agreement with a preferred
8-23 provider organization for the purposes of offering a network of
8-24 preferred providers. The agreement may provide that the notice
8-25 and other insurer requirements of this section may be complied with
9-1 by either the insurer or the preferred provider organization on the
9-2 insurer's behalf. If an insurer enters into an agreement with a
9-3 preferred provider organization under this section, it is the
9-4 insurer's responsibility to meet the requirements of this section
9-5 or to assure that the requirements are met. All preferred provider
9-6 insurance benefit plans offered in this state shall comply with the
9-7 requirements of this section.
9-8 Sec. 4. CONTINUITY OF CARE. (a) The insurer shall
9-9 establish reasonable procedures for assuring a transition of
9-10 insureds to physicians or health care providers and for continuity
9-11 of treatment. Insurers shall provide, subject to Section 6(e) of
9-12 this article, reasonable advance notice to the insured of the
9-13 impending termination from the plan of a physician or health care
9-14 provider who is currently treating the insured and in the event of
9-15 termination of a preferred provider's participation in the plan
9-16 shall make available to the insured a current listing of preferred
9-17 providers.
9-18 (b) Each contract between an insurer and a physician or
9-19 health care provider must provide that the termination of a
9-20 preferred provider's participation in the plan, except for reason
9-21 of medical competence or professional behavior, shall not release
9-22 the physician or health care provider from the generally recognized
9-23 obligation to treat the insured and cooperate in arranging for
9-24 appropriate referrals or release the insurer from the obligation to
9-25 reimburse the physician or health care provider or, if applicable,
10-1 the insured at the same preferred provider rate if, at the time of
10-2 the preferred provider's termination, the insured has special
10-3 circumstances such as a disability, acute condition, or
10-4 life-threatening illness or is past the 24th week of pregnancy and
10-5 is receiving treatment in accordance with the dictates of medical
10-6 prudence.
10-7 (c) For purposes of Subsection (b) of this section, "special
10-8 circumstances" means a condition such that the treating physician
10-9 or health care provider reasonably believes that discontinuing care
10-10 by the treating physician or provider could cause harm to the
10-11 patient. Special circumstances shall be identified by the treating
10-12 physician or health care provider, who must request that the
10-13 insured be permitted to continue treatment under the physician's or
10-14 provider's care and agree not to seek payment from the patient of
10-15 any amounts for which the insured would not be responsible if the
10-16 physician or provider were still a preferred provider.
10-17 (d) Contracts between an insurer and physicians and health
10-18 care providers shall include procedures for resolving disputes
10-19 regarding the necessity for continued treatment by a physician or
10-20 provider.
10-21 (e) This section does not extend the obligation of the
10-22 insurer to reimburse, at the preferred provider level of coverage,
10-23 the terminated physician or health care provider or, if applicable,
10-24 the insured for ongoing treatment of an insured after the 90th day
10-25 from the effective date of the termination.
11-1 Sec. 5. EMERGENCY CARE PROVISIONS. If the insured cannot
11-2 reasonably reach a preferred provider, an insurer shall provide
11-3 reimbursement for the following emergency care services at the
11-4 preferred level of benefits until the insured can reasonably be
11-5 expected to transfer to a preferred provider:
11-6 (1) any medical screening examination or other
11-7 evaluation required by state or federal law to be provided in the
11-8 emergency facility of a hospital which is necessary to determine
11-9 whether a medical emergency condition exists;
11-10 (2) necessary emergency care services including the
11-11 treatment and stabilization of an emergency medical condition; and
11-12 (3) services originating in a hospital emergency
11-13 facility following treatment or stabilization of an emergency
11-14 medical condition.
11-15 Sec. 6. MANDATORY DISCLOSURE REQUIREMENTS. (a) All health
11-16 insurance policies, health benefit plan certificates, endorsements,
11-17 amendments, applications, or riders shall be written in plain
11-18 language, must be in a readable and understandable format, and must
11-19 comply with all applicable requirements relating to minimum
11-20 readability requirements.
11-21 (b) The insurer shall provide to a current or prospective
11-22 group contract holder or current or prospective insured on request
11-23 an accurate written description of the terms and conditions of the
11-24 policy to allow the current or prospective group contract holder or
11-25 current or prospective insured to make comparisons and informed
12-1 decisions before selecting among health care plans. The written
12-2 description must be in a readable and understandable format as
12-3 prescribed by the commissioner and must include a current list of
12-4 preferred providers. The insurer may provide its handbook to
12-5 satisfy this requirement provided the handbook's content is
12-6 substantively similar to and achieves the same level of disclosure
12-7 as the written description prescribed by the commissioner and the
12-8 current list of physicians and health care providers is provided.
12-9 (c) A current list of preferred providers shall be provided
12-10 to all insureds no less than annually.
12-11 (d) No insurer, or agent or representative of an insurer,
12-12 may cause or permit the use or distribution of prospective insured
12-13 information which is untrue or misleading.
12-14 (e) If a physician or practitioner is terminated for reasons
12-15 other than at the preferred provider's request, an insurer shall
12-16 not notify enrollees of the termination until the effective date of
12-17 the termination or at such time as a review panel makes a formal
12-18 recommendation regarding the termination, whichever is later. If a
12-19 physician or practitioner is terminated for reasons related to
12-20 imminent harm, an insurer may notify enrollees immediately.
12-21 Sec. 7. PROHIBITED PRACTICES. (a) No insurer shall engage
12-22 in any retaliatory action against an insured, including
12-23 cancellation of or refusal to renew a policy, because the insured,
12-24 or a person acting on behalf of the insured, has filed a complaint
12-25 against the insurer or against a preferred provider or has appealed
13-1 a decision of the insurer.
13-2 (b) No insurer shall engage in any retaliatory action
13-3 against a physician or health care provider, including termination
13-4 of or refusal to renew a contract, because the physician or
13-5 provider has, on behalf of an insured, reasonably filed a complaint
13-6 against the insurer or has appealed a decision of the insurer.
13-7 (c)(1) An insurer shall not, as a condition of a contract
13-8 with a physician or health care provider or in any other manner,
13-9 prohibit, attempt to prohibit, nor discourage a physician or
13-10 provider from:
13-11 (A) discussing with or communicating to a
13-12 current, prospective, or former patient, or a party designated by a
13-13 patient, information or opinions regarding that patient's health
13-14 care, including but not limited to the patient's medical condition,
13-15 treatment options, or other health care services; or
13-16 (B) discussing with or communicating in good
13-17 faith to a current, prospective, or former patient, or a party
13-18 designated by a patient, information or opinions regarding the
13-19 provisions, terms, requirements, or services of the health care
13-20 plan as they relate to the medical needs of the patient.
13-21 (2) An insurer shall not in any way penalize,
13-22 terminate, nor refuse to compensate for covered services a
13-23 physician or provider for discussing or communicating with a
13-24 current, prospective, or former patient, or a party designated by a
13-25 patient, pursuant to this section.
14-1 (d) An insurer shall not use any financial incentive or make
14-2 payment to a physician or health care provider which acts directly
14-3 or indirectly as an inducement to limit medically necessary
14-4 services.
14-5 Sec. 8. AVAILABILITY OF PREFERRED PROVIDERS. (a) Any
14-6 insurer offering a preferred provider benefit plan must ensure that
14-7 both preferred provider benefits and basic level benefits are
14-8 reasonably available to all insureds within a designated service
14-9 area.
14-10 (b) If services are not available through preferred
14-11 providers within the service area, nonpreferred providers shall be
14-12 reimbursed at the same percentage level of reimbursement as the
14-13 preferred providers would have been reimbursed had the insured been
14-14 treated by them.
14-15 Sec. 9. RULEMAKING AUTHORITY. The commissioner shall adopt
14-16 rules as necessary to implement the provisions of this article and
14-17 to ensure reasonable accessibility and availability of preferred
14-18 provider and basic level benefits to Texas citizens.
14-19 SECTION 2. The requirements of Article 3.70-3C, Insurance
14-20 Code, as added by Section 1 of this Act, apply to any insurance
14-21 policy or contract issued, delivered, or renewed on or after the
14-22 effective date of this Act.
14-23 SECTION 3. The importance of this legislation and the
14-24 crowded condition of the calendars in both houses create an
14-25 emergency and an imperative public necessity that the
15-1 constitutional rule requiring bills to be read on three several
15-2 days in each house be suspended, and this rule is hereby suspended,
15-3 and that this Act take effect and be in force from and after its
15-4 passage, and it is so enacted.