1-1 By: Madla S.B. No. 976 1-2 (In the Senate - Filed March 6, 1997; March 10, 1997, read 1-3 first time and referred to Committee on Economic Development; 1-4 April 11, 1997, reported adversely, with favorable Committee 1-5 Substitute by the following vote: Yeas 11, Nays 0; April 11, 1997, 1-6 sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 976 By: Madla 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to managed care plans issued by managed care organizations 1-11 under Medicare risk-sharing contracts; providing administrative 1-12 penalties. 1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-14 SECTION 1. Subchapter E, Chapter 21, Insurance Code, is 1-15 amended by adding Article 21.52G to read as follows: 1-16 Art. 21.52G. REQUIREMENTS FOR MANAGED CARE ORGANIZATIONS 1-17 UNDER MEDICARE RISK-SHARING CONTRACTS 1-18 Sec. 1. DEFINITIONS. In this article: 1-19 (1) "Managed care organization" means an eligible 1-20 organization under 42 U.S.C. Section 1395mm. 1-21 (2) "Managed care plan" means a health benefit plan 1-22 issued by a managed care organization through which the 1-23 organization provides certain health care services. 1-24 (3) "Enrollee" means a person who receives certain 1-25 health care services through a managed care plan. 1-26 (4) "Participating provider" means a physician or 1-27 other health care provider who is under contract with a managed 1-28 care organization to provide certain health care services to 1-29 enrollees in a managed care plan issued by the organization. 1-30 (5) "Medicare" means the health insurance program for 1-31 the aged established under Parts A and B, Title XVIII, Social 1-32 Security Act (42 U.S.C. Section 1395 et seq.). 1-33 (6) "Risk-sharing contract" has the meaning assigned 1-34 by 42 U.S.C. Section 1395mm. 1-35 Sec. 2. SCOPE OF ARTICLE. This article applies only to 1-36 enrollment of a Medicare recipient in a managed care plan issued by 1-37 a managed care organization that enters into a risk-sharing 1-38 contract to provide certain health care services to Medicare 1-39 recipients through that managed care plan. 1-40 Sec. 3. NOTICE TO PROVIDERS. Not later than the 10th day 1-41 after the date on which a managed care organization enrolls an 1-42 enrollee in a managed care plan, the organization shall provide to 1-43 each health care provider listed by the enrollee under Section 3(a) 1-44 of this article written notice of the enrollment and notice of the 1-45 extent to which the plan will reimburse the provider for services 1-46 provided to the new enrollee. 1-47 Sec. 4. DUTIES TO ENROLLEES. (a) A managed care 1-48 organization shall provide to an enrollee a sticker to attach to 1-49 the enrollee's Medicare identification card that indicates 1-50 enrollment in the managed care plan. The sticker must include the 1-51 name of the plan and the plan's telephone number. 1-52 (b) A managed care organization shall ensure continuity of 1-53 care for all plan enrollees by ensuring the enrollee's timely 1-54 selection of a primary health care provider who is a participating 1-55 provider. 1-56 (c) A managed care organization that fails to provide for 1-57 the timely selection of a primary health care provider by an 1-58 enrollee shall reimburse a health care provider for all health care 1-59 services provided to the enrollee before the enrollee selects a 1-60 primary health care provider, regardless of whether the provider 1-61 who provides those services is a participating provider. 1-62 Sec. 5. OMBUDSMAN. The department shall provide an 1-63 ombudsman to assist Medicare recipients enrolled in managed care 1-64 plans and to ensure that managed care organizations subject to this 2-1 article comply with this article. 2-2 Sec. 6. MANAGED CARE PLAN FORMS. A managed care 2-3 organization may not use a printed form for enrollment in a managed 2-4 care plan unless the organization files a copy of the form with the 2-5 commissioner not later than the 60th day before the date on which 2-6 the organization proposes to use the form. The organization may 2-7 use the form unless the commissioner notifies the organization of 2-8 the commissioner's disapproval of the form not later than the 15th 2-9 day before the date of proposed use of the form. 2-10 Sec. 7. ADVERTISING. A managed care organization may not 2-11 advertise the availability of its managed care plan for Medicare 2-12 recipients unless the organization files a copy of the 2-13 advertisement with the commissioner not later than the 60th day 2-14 before the date the organization proposes to use the advertisement. 2-15 The organization may use the advertisement unless the commissioner 2-16 notifies the organization of the commissioner's disapproval of the 2-17 advertisement not later than the 15th day before the date of 2-18 proposed use of the advertisement. 2-19 Sec. 8. ADMINISTRATIVE PENALTY. A managed care organization 2-20 that violates this article is subject to administrative penalties 2-21 under Article 1.10E of this code. 2-22 Sec. 9. RULES. The commissioner shall adopt rules to 2-23 implement this article. 2-24 SECTION 2. Not later than January 1, 1998, the commissioner 2-25 of insurance shall adopt rules as required by Section 10, Article 2-26 21.52G, Insurance Code, as added by this Act. 2-27 SECTION 3. (a) This Act takes effect September 1, 1997. 2-28 (b) This Act applies only to an evidence of coverage under a 2-29 managed care plan that is delivered, issued for delivery, or 2-30 renewed on or after January 1, 1998. An evidence of coverage under 2-31 a managed care plan that is delivered, issued for delivery, or 2-32 renewed before January 1, 1998, is governed by the law as it 2-33 existed immediately before the effective date of this Act, and that 2-34 law is continued in effect for that purpose. 2-35 (c) This Act applies to an advertisement for a managed care 2-36 plan used on or after January 1, 1998. An advertisement used 2-37 before January 1, 1998, is governed by the law as it existed 2-38 immediately before the effective date of this Act, and that law is 2-39 continued in effect for that purpose. 2-40 SECTION 4. The importance of this legislation and the 2-41 crowded condition of the calendars in both houses create an 2-42 emergency and an imperative public necessity that the 2-43 constitutional rule requiring bills to be read on three several 2-44 days in each house be suspended, and this rule is hereby suspended. 2-45 * * * * *