By Madla S.B. No. 976
75R5023 SAW-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to managed care plans issued by managed care organizations
1-3 under Medicare risk-sharing contracts; imposing administrative
1-4 penalties.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subchapter E, Chapter 21, Insurance Code, is
1-7 amended by adding Article 21.52G to read as follows:
1-8 Art. 21.52G. REQUIREMENTS FOR MANAGED CARE ORGANIZATIONS
1-9 UNDER MEDICARE RISK-SHARING CONTRACTS
1-10 Sec. 1. DEFINITIONS. In this article:
1-11 (1) "Managed care organization" means an eligible
1-12 organization under 42 U.S.C. Section 1395mm.
1-13 (2) "Managed care plan" means a health benefit plan
1-14 issued by a managed care organization through which the
1-15 organization provides certain health care services.
1-16 (3) "Enrollee" means a person who receives certain
1-17 health care services through a managed care plan.
1-18 (4) "Participating provider" means a physician or
1-19 other health care provider who is under contract with a managed
1-20 care organization to provide certain health care services to
1-21 enrollees in a managed care plan issued by the organization.
1-22 (5) "Medicare" means the health insurance program for
1-23 the aged established under Parts A and B, Title XVIII, Social
1-24 Security Act (42 U.S.C. Section 1395 et seq.).
2-1 (6) "Risk-sharing contract" has the meaning assigned
2-2 by 42 U.S.C. Section 1395mm.
2-3 Sec. 2. SCOPE OF ARTICLE. This article applies only to
2-4 enrollment of a Medicare recipient in a managed care plan issued by
2-5 a managed care organization that enters into a risk-sharing
2-6 contract to provide certain health care services to Medicare
2-7 recipients through that managed care plan.
2-8 Sec. 3. PRE-ENROLLMENT REQUIREMENTS. (a) A managed care
2-9 organization shall as part of the application for enrollment in a
2-10 managed care plan require a prospective enrollee to provide
2-11 information necessary for the organization to determine whether the
2-12 prospective enrollee's health care providers are participating
2-13 providers in the plan. The prospective enrollee must provide this
2-14 information on a form prescribed by the commissioner that lists
2-15 categories of health care providers. The prospective enrollee must
2-16 sign the form, and the organization shall provide a copy of the
2-17 signed form to the prospective enrollee.
2-18 (b) Not later than the 10th day after the date on which the
2-19 managed care organization receives an application for enrollment,
2-20 the organization shall provide to the prospective enrollee a
2-21 document that:
2-22 (1) lists the name of each health care provider that
2-23 the prospective enrollee listed on the application form and notes
2-24 whether that health care provider is a participating provider in
2-25 the plan on the date of the application;
2-26 (2) describes the plan's procedure for selection of a
2-27 primary health care provider who participates in the plan,
3-1 including selection before enrollment;
3-2 (3) describes the plan's referral requirements for
3-3 participating providers who are specialists; and
3-4 (4) lists each hospital that participates in the plan.
3-5 (c) A managed care organization may not enroll a prospective
3-6 enrollee until the prospective enrollee signs a statement
3-7 described by Subsection (d) of this section and returns the
3-8 statement to the organization. The managed care organization shall
3-9 prepare the statement for the prospective enrollee and shall attach
3-10 to the statement an additional copy of the document provided to the
3-11 prospective enrollee under Subsection (b) of this section.
3-12 (d) The statement required by Subsection (c) of this section
3-13 must be printed in 12-point or larger type and state that the
3-14 prospective enrollee understands:
3-15 (1) whether or not each health care provider listed on
3-16 the document attached to the statement is a participating provider
3-17 in the plan;
3-18 (2) that an enrollee in the plan is required to obtain
3-19 health care services from a participating provider to receive full
3-20 coverage under the plan;
3-21 (3) that the managed care plan may not fully or even
3-22 partially reimburse a health care provider for services provided to
3-23 an enrollee if the health care provider is not a participating
3-24 provider in the plan, even if the prospective enrollee listed the
3-25 provider on the form completed at the time of application for
3-26 enrollment;
3-27 (4) that an enrollee is required to pay for services
4-1 provided by a health care provider who is not a participating
4-2 provider in the plan to the extent that the plan does not reimburse
4-3 the provider for the services;
4-4 (5) that an enrollee is required to obtain a referral
4-5 from the enrollee's primary health care provider under the plan
4-6 before obtaining the services of a specialist, even if the
4-7 specialist is a participating provider in the plan, and that the
4-8 enrollee is required to pay for services provided by a specialist
4-9 without a referral; and
4-10 (6) that the hospitals listed on the document attached
4-11 to the statement are the only hospitals that the plan will
4-12 reimburse for services provided to an enrollee.
4-13 (e) A managed care organization that violates this section
4-14 shall reimburse a health care provider for all health care services
4-15 provided to an enrollee, regardless of whether the provider is a
4-16 participating provider.
4-17 Sec. 4. NOTICE TO PROVIDERS. Not later than the 10th day
4-18 after the date on which a managed care organization enrolls an
4-19 enrollee in a managed care plan, the organization shall provide to
4-20 each health care provider listed by the enrollee under Section 3(a)
4-21 of this article written notice of the enrollment and notice of the
4-22 extent to which the plan will reimburse the provider for services
4-23 provided to the new enrollee.
4-24 Sec. 5. DUTIES TO ENROLLEES. (a) A managed care
4-25 organization shall provide to an enrollee a sticker to attach to
4-26 the enrollee's Medicare identification card that indicates
4-27 enrollment in the managed care plan. The sticker must include the
5-1 name of the plan and the plan's telephone number.
5-2 (b) A managed care organization shall ensure continuity of
5-3 care for all plan enrollees by ensuring the enrollee's timely
5-4 selection of a primary health care provider who is a participating
5-5 provider.
5-6 (c) A managed care organization that fails to provide for
5-7 the timely selection of a primary health care provider by an
5-8 enrollee shall reimburse a health care provider for all health care
5-9 services provided to the enrollee before the enrollee selects a
5-10 primary health care provider, regardless of whether the provider
5-11 who provides those services is a participating provider.
5-12 Sec. 6. OMBUDSMAN. The department shall provide an
5-13 ombudsman to assist Medicare recipients enrolled in managed care
5-14 plans and to ensure that managed care organizations subject to this
5-15 article comply with this article.
5-16 Sec. 7. MANAGED CARE PLAN FORMS. A managed care
5-17 organization may not use a printed form for enrollment in a managed
5-18 care plan unless the organization files a copy of the form with the
5-19 commissioner not later than the 60th day before the date on which
5-20 the organization proposes to use the form. The organization may
5-21 use the form unless the commissioner notifies the organization of
5-22 the commissioner's disapproval of the form not later than the 15th
5-23 day before the date of proposed use of the form.
5-24 Sec. 8. ADVERTISING. A managed care organization may not
5-25 advertise the availability of its managed care plan for Medicare
5-26 recipients unless the organization files a copy of the
5-27 advertisement with the commissioner not later than the 60th day
6-1 before the date the organization proposes to use the advertisement.
6-2 The organization may use the advertisement unless the commissioner
6-3 notifies the organization of the commissioner's disapproval of the
6-4 advertisement not later than the 15th day before the date of
6-5 proposed use of the advertisement.
6-6 Sec. 9. ADMINISTRATIVE PENALTY. A managed care organization
6-7 that violates this article is subject to administrative penalties
6-8 under Article 1.10E of this code.
6-9 Sec. 10. RULES. The commissioner shall adopt rules to
6-10 implement this article.
6-11 SECTION 2. Not later than January 1, 1998, the commissioner
6-12 shall adopt rules as required by Section 10, Article 21.52G,
6-13 Insurance Code, as added by this Act.
6-14 SECTION 3. (a) This Act takes effect September 1, 1997.
6-15 (b) This Act applies only to an evidence of coverage under a
6-16 managed care plan that is delivered, issued for delivery, or
6-17 renewed on or after January 1, 1998. An evidence of coverage under
6-18 a managed care plan that is delivered, issued for delivery, or
6-19 renewed before January 1, 1998, is governed by the law as it
6-20 existed immediately before the effective date of this Act, and that
6-21 law is continued in effect for that purpose.
6-22 (c) This Act applies to an advertisement for a managed care
6-23 plan used on or after January 1, 1998. An advertisement used
6-24 before January 1, 1998, is governed by the law as it existed
6-25 immediately before the effective date of this Act, and that law is
6-26 continued in effect for that purpose.
6-27 SECTION 4. The importance of this legislation and the
7-1 crowded condition of the calendars in both houses create an
7-2 emergency and an imperative public necessity that the
7-3 constitutional rule requiring bills to be read on three several
7-4 days in each house be suspended, and this rule is hereby suspended.