By Sibley, et al. S.B. No. 1300
75R8997 PB-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the certification, operation, powers, and duties of
1-3 certain integrated health plans.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. The Insurance Code is amended by adding Chapter
1-6 20B to read as follows:
1-7 CHAPTER 20B. INTEGRATED HEALTH PLANS
1-8 SUBCHAPTER A. GENERAL PROVISIONS
1-9 Art. 20B.001. DEFINITIONS. In this chapter:
1-10 (1) "Basic health services" has the meaning assigned
1-11 by Section 2, Health Maintenance Organization Act of 1973, as
1-12 amended (42 U.S.C. Section 300e-1).
1-13 (2) "Group medical practice" means a group that:
1-14 (A) is composed of physicians and other
1-15 providers who are salaried employees or affiliates of the group
1-16 medical practice;
1-17 (B) has a physician as its chief executive
1-18 officer;
1-19 (C) voluntarily supports medical education or
1-20 research through a formal affiliation with the medical school
1-21 component of a public institution of higher education in this
1-22 state; and
1-23 (D) provides a majority of the professional
1-24 medical services rendered to a plan's members.
2-1 (3) "Health maintenance organization" means a health
2-2 maintenance organization organized under the Texas Health
2-3 Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
2-4 Code).
2-5 (4) "Integrated health plan" means a nonprofit health
2-6 maintenance organization that holds a certificate of authority
2-7 under this chapter.
2-8 (5) "Life-threatening disease or condition" means a
2-9 disease or condition:
2-10 (A) in which the likelihood of death within one
2-11 year or less is high unless the course of the disease or condition
2-12 is interrupted; or
2-13 (B) that has a potentially fatal outcome within
2-14 one year or less and in which the goal of clinical intervention is
2-15 survival.
2-16 (6) "Member" means an eligible person who is enrolled
2-17 for coverage in a plan.
2-18 (7) "Plan" means:
2-19 (A) an integrated health plan; or
2-20 (B) a nonprofit health maintenance organization
2-21 that has submitted a certificate of authority application under
2-22 Article 20B.011 of this code.
2-23 (8) "Provider" means:
2-24 (A) a physician; or
2-25 (B) another licensed health care practitioner
2-26 who provides health care services under the scope of the
2-27 practitioner's license.
3-1 (9) "Subscriber" means an individual who is properly
3-2 enrolled for coverage under a plan because the individual is:
3-3 (A) an eligible employee of an eligible
3-4 employer; or
3-5 (B) another person whose employment or other
3-6 status, other than dependent status, is the basis for eligibility
3-7 for coverage under the plan.
3-8 Art. 20B.002. RULES. The commissioner shall adopt rules as
3-9 necessary to implement this chapter.
3-10 Art. 20B.003. EFFECT OF CERTIFICATION. A health maintenance
3-11 organization that is certified as an integrated health plan is
3-12 subject to regulation only as provided by this chapter.
3-13 (Articles 20B.004-20B.010 reserved for expansion
3-14 SUBCHAPTER B. CERTIFICATION REQUIREMENTS
3-15 Art. 20B.011. CERTIFICATION BY COMMISSIONER. On submission
3-16 of an application to the department, the commissioner shall issue a
3-17 certificate of authority as an integrated health plan to an
3-18 eligible nonprofit health maintenance organization that:
3-19 (1) meets the requirements described under Subchapters
3-20 C, D, E, F, and G of this chapter; and
3-21 (2) is accredited by:
3-22 (A) the National Committee on Quality Assurance;
3-23 or
3-24 (B) a similar nationally recognized review
3-25 organization acceptable to the commissioner.
3-26 Art. 20B.012. ELIGIBILITY. The commissioner may not issue a
3-27 certificate of authority under this chapter to a single service or
4-1 limited service health maintenance organization.
4-2 Art. 20B.013. REVOCATION OF CERTIFICATE. (a) After notice
4-3 to an integrated health plan and an opportunity for a hearing, the
4-4 commissioner may revoke that plan's certificate issued under this
4-5 chapter for a material violation of this chapter.
4-6 (b) The commissioner shall notify the integrated health plan
4-7 in writing not later than the 30th day before the effective date of
4-8 the proposed revocation. The notice must specify in detail the
4-9 reasons for the proposed revocation.
4-10 (c) The integrated health plan has 30 days after the date on
4-11 which the notice is sent to:
4-12 (1) correct the problems listed in the notice; or
4-13 (2) show to the satisfaction of the commissioner that
4-14 the information in the notice is incorrect.
4-15 (d) An integrated health plan that receives a notice under
4-16 this article may dispute the assertions in the notice and request a
4-17 hearing under Chapter 2001, Government Code, to resolve the
4-18 dispute.
4-19 Art. 20B.014. STANDARDS. Notwithstanding any other
4-20 provision of this chapter, the commissioner may not issue a
4-21 certificate of authority to, and may revoke the certificate of
4-22 authority of, an integrated health plan that fails to meet or
4-23 maintain complaint standards or ratios, quality of care standards
4-24 or ratios, or financial stability or viability standards or ratios
4-25 that are considered appropriate by the commissioner.
4-26 (Articles 20B.015-20B.020 reserved for expansion
5-1 SUBCHAPTER C. ADMINISTRATION AND ORGANIZATION OF PLAN
5-2 Art. 20B.021. NONPROFIT ENTITY. Each plan must be organized
5-3 as a nonprofit entity.
5-4 Art. 20B.022. BOARD OF DIRECTORS. Each plan must have a
5-5 board of directors that includes:
5-6 (1) members; and
5-7 (2) physicians, or a combination of physicians and
5-8 other types of providers, who provide health care services to
5-9 members.
5-10 Art. 20B.023. GROUP MEDICAL PRACTICE. (a) Each plan shall
5-11 provide the majority of its professional medical services through a
5-12 single group medical practice.
5-13 (b) The plan shall:
5-14 (1) appoint as chief executive officer of the plan a
5-15 physician who is a member of the group medical practice; or
5-16 (2) adopt procedures that ensure that medical
5-17 management policies are a cooperative endeavor between the group
5-18 medical practice and the plan.
5-19 (c) The procedures adopted under Subsection (b) of this
5-20 article must establish methods by which the health care interests
5-21 of plan members and the medical interests of the physicians of the
5-22 group medical practice are represented at the policy and
5-23 decision-making levels of the plan.
5-24 (d) Physicians from the group medical practice, other
5-25 qualified providers, or other licensed medical personnel under the
5-26 direct supervision of physicians from the group medical practice,
5-27 shall make each determination regarding:
6-1 (1) medical utilization management;
6-2 (2) medical quality assurance;
6-3 (3) medical issues relating to coverage;
6-4 (4) medical necessity or appropriateness of treatment;
6-5 and
6-6 (5) medical issues relating to pre-authorization and
6-7 post-authorization of treatment.
6-8 Art. 20B.024. RIGHTS OF PROVIDERS. (a) A plan may not
6-9 prohibit a physician or other provider from discussing treatment
6-10 options or restrict the provider's discussion of treatment options
6-11 based on whether the plan covers the treatment or the cost of the
6-12 treatment. This subsection does not require the plan to provide
6-13 services or to cover treatments not otherwise included in its
6-14 applicable benefit plan.
6-15 (b) The plan or group medical practice, as appropriate,
6-16 shall:
6-17 (1) make available and disclose to each provider who
6-18 applies for participation in the plan its written application
6-19 procedures and qualification requirements for contracting with the
6-20 plan; and
6-21 (2) provide a written notice of the reasons an initial
6-22 application by a provider may be denied, which may include
6-23 rejection of an initial application on the basis that the plan has
6-24 a sufficient number of qualified providers of that type.
6-25 Art. 20B.025. CREDENTIALING PROGRAM; REQUIREMENTS. (a) A
6-26 plan shall use physicians and other providers whose credentials are
6-27 verified through a program that meets the requirements of this
7-1 article.
7-2 (b) The plan shall implement its credentialing program
7-3 through written policies and procedures establishing the
7-4 credentialing process, including methods for original
7-5 credentialing, recredentialing, recertification, and reappointment
7-6 of physicians and providers who fall within the scope of services
7-7 provided by the plan.
7-8 (c) The credentialing program shall obtain and review
7-9 evidence of the following from primary sources:
7-10 (1) a license to practice from the appropriate
7-11 licensing authority;
7-12 (2) a valid Drug Enforcement Administration
7-13 registration under 21 U.S.C. Section 823 or a controlled
7-14 substances registration under Subchapter C, Chapter 481, Health and
7-15 Safety Code, as applicable;
7-16 (3) graduation from an accredited medical school and
7-17 completion of a residency, or board certification, as applicable;
7-18 (4) work history;
7-19 (5) adequate professional liability insurance in
7-20 accordance with the requirements adopted by the plan;
7-21 (6) history of professional liability claims; and
7-22 (7) sufficient information to enable the plan to
7-23 request information on the applicant from the National Practitioner
7-24 Data Bank and from the appropriate professional licensing agency
7-25 for this state.
7-26 (d) The credentialing program shall also establish methods
7-27 by which a periodic review is conducted to verify the credentials
8-1 of a provider and to evaluate:
8-2 (1) members' complaints and comments;
8-3 (2) the plan's quality reviews;
8-4 (3) utilization management; and
8-5 (4) the results of member satisfaction surveys.
8-6 Art. 20B.026. PROVIDER INCENTIVE ARRANGEMENTS. (a) A plan
8-7 may not provide incentives or rewards to its providers for denying
8-8 or limiting necessary care to members.
8-9 (b) A plan's payment arrangements for physicians and other
8-10 providers may not place an individual provider at such a
8-11 substantial personal financial risk that it induces the provider to
8-12 either inappropriately restrict medically necessary care or provide
8-13 care beyond that which is conservatively needed by the patient.
8-14 Physicians and other providers shall have the freedom to make
8-15 clinical treatment decisions without substantial personal financial
8-16 risk or reward.
8-17 Art. 20B.027. REVENUE TO BE SPENT ON SERVICES TO MEMBERS.
8-18 (a) Each plan shall spend, on average over a three-year period, at
8-19 least 85 percent of the revenue received from its members on the
8-20 provision of services to its members.
8-21 (b) The commissioner shall consider a plan to have met the
8-22 requirement of Subsection (a) of this article if compliance by the
8-23 plan with the requirement may be inferred by periodic reports made
8-24 by the plan to the National Association of Insurance Commissioners.
8-25 Art. 20B.028. MARKETING REQUIREMENTS. (a) In offering its
8-26 benefit plan to employers, each plan shall provide adequate written
8-27 descriptions of its rules, procedures, benefits, fees and other
9-1 charges, and services.
9-2 (b) The plan shall publicize through appropriate methods its
9-3 enrollment periods and shall specify whether an enrollment period
9-4 is limited or of continuous duration.
9-5 (c) On request by a member, the plan shall provide to the
9-6 member a written copy of the most current statement of member rules
9-7 and rights. The information must include:
9-8 (1) a description of the benefits provided;
9-9 (2) how and where to obtain services;
9-10 (3) restrictions on coverage, if any;
9-11 (4) a description of the plan's grievance resolution
9-12 and appeals procedures;
9-13 (5) rights of a member regarding termination of
9-14 enrollment;
9-15 (6) findings from patient satisfaction surveys and
9-16 quality reviews conducted by external organizations; and
9-17 (7) a statement of the obligation of the plan to
9-18 assume financial responsibility and provide reasonable
9-19 reimbursement for medically necessary emergency services and
9-20 urgently needed services.
9-21 (d) The plan may not discriminate in its marketing by:
9-22 (1) discouraging participation on the basis of age or
9-23 race; or
9-24 (2) attempting to enroll persons from a high-income
9-25 area if a comparable effort is not made to enroll persons from
9-26 lower-income areas.
9-27 (e) The plan may not market its benefit plan in a manner
10-1 that would mislead, confuse, or misrepresent.
10-2 (f) The plan may not offer gifts or payment as an inducement
10-3 to enroll in the plan, except for marketing materials, meals,
10-4 souvenirs, and other items of nominal value.
10-5 (Articles 20B.029-20B.040 reserved for expansion
10-6 SUBCHAPTER D. QUALITY IMPROVEMENT
10-7 Art. 20B.041. QUALITY IMPROVEMENT PROGRAM. (a) Each plan
10-8 shall adopt an ongoing quality improvement program designed to
10-9 monitor and evaluate the quality and appropriateness of care and
10-10 service provided to members and to pursue opportunities for
10-11 improvement. The scope and content of the program shall reflect
10-12 the delivery system of the plan and shall include both the quality
10-13 of clinical care and the quality of service. The program shall
10-14 have a written quality improvement statement that contains, at a
10-15 minimum:
10-16 (1) a methodology that stresses health outcomes;
10-17 (2) peer review by physicians and other providers;
10-18 (3) systematic data collection on performance and
10-19 patient results; and
10-20 (4) procedures for taking appropriate remedial action.
10-21 (b) The quality improvement program shall identify important
10-22 areas for improvement. The monitoring and evaluation of important
10-23 aspects of care and service by the program shall include
10-24 high-volume, high-risk services and the care of acute and chronic
10-25 conditions. Through the program, the plan shall:
10-26 (1) adopt practice guidelines or explicit criteria
10-27 that are based on reasonable scientific evidence and reviewed by
11-1 plan providers;
11-2 (2) evaluate the continuity and coordination of care
11-3 that members receive; and
11-4 (3) establish mechanisms to detect underuse as well as
11-5 overuse.
11-6 Art. 20B.042. ORGANIZATIONAL DESCRIPTION. Each plan shall
11-7 specify within the quality improvement program its organizational
11-8 arrangements and responsibilities for quality improvement
11-9 processes, which must be clearly defined and assigned to
11-10 appropriate individuals. The plan shall maintain a written
11-11 description of the program that outlines the program structure and
11-12 design. The plan shall review the program description annually and
11-13 update the description as necessary.
11-14 Art. 20B.043. PROGRAM IMPLEMENTATION. (a) A designated
11-15 senior executive of the plan shall be responsible for
11-16 implementation of the program. The plan's medical director shall
11-17 have substantial involvement in quality improvement activities.
11-18 (b) If the plan delegates any quality improvement activities
11-19 to independent contractors, the quality improvement program must
11-20 require oversight of the delegated activities by the plan. The
11-21 required oversight must include periodic reporting by the
11-22 contractor, accountability for the delegated activities, and
11-23 establishment of a process by which the delegation is evaluated.
11-24 Art 20B.044. QUALITY IMPROVEMENT COMMITTEE. (a) Each plan
11-25 shall appoint a committee to oversee and support quality
11-26 improvement activities. The contracting providers shall
11-27 participate actively in the quality improvement committee.
12-1 (b) The committee shall maintain records reflecting the
12-2 actions of the committee. The committee shall adopt an annual
12-3 quality improvement work plan or schedule of activities that
12-4 includes:
12-5 (1) the objectives, scope, and planned projects or
12-6 activities for the year;
12-7 (2) planned monitoring of previously identified
12-8 issues, including tracking of those issues over time; and
12-9 (3) planned evaluation of the quality improvement
12-10 program.
12-11 (c) The committee shall be accountable to the governing body
12-12 of the plan or a committee of plan senior managers. The committee
12-13 shall demonstrate evidence of a formally designated structure,
12-14 accountability at the highest levels of the organization, and
12-15 ongoing and continuous oversight of quality improvement.
12-16 Art. 20B.045. REPORTS; COORDINATION OF ACTIVITIES. (a) The
12-17 quality improvement program shall document and report to
12-18 appropriate individuals within the plan organization the findings,
12-19 conclusions, recommendations, actions taken, and results of the
12-20 actions taken as a result of quality improvement activity. The
12-21 reports shall be made through the quality improvement program in
12-22 accordance with the plan organizational structure.
12-23 (b) The program shall coordinate quality improvement
12-24 activities with other performance-monitoring activities.
12-25 Art. 20B.046. DATA ANALYSIS. (a) The quality improvement
12-26 program shall analyze measurements of quality and quality
12-27 improvement data to evaluate quality improvement. The program
13-1 shall use quality indicators that are objective, measurable, and
13-2 based on current knowledge and clinical experience to monitor and
13-3 evaluate each important aspect of care and service identified by
13-4 the program.
13-5 (b) The program shall analyze all data collected through the
13-6 monitoring and evaluation activities.
13-7 Art. 20B.047. EVALUATION. (a) Each quality improvement
13-8 program shall ensure that the plan takes action as necessary to
13-9 improve quality and shall assess the effectiveness of that action
13-10 through systematic evaluations.
13-11 (b) The results of evaluations conducted under this article
13-12 shall be used by the plan to improve clinical care and service.
13-13 Art. 20B.048. ANNUAL ASSESSMENT BY PLAN; REPORT. Each plan
13-14 shall annually assess the overall effectiveness of its quality
13-15 improvement program and shall issue an annual written report on
13-16 quality improvement, including:
13-17 (1) completed quality improvement activities;
13-18 (2) trends in clinical and service indicators and
13-19 other performance data; and
13-20 (3) demonstrated improvements in quality.
13-21 (Articles 20B.049-20B.060 reserved for expansion
13-22 SUBCHAPTER E. DELIVERY OF HEALTH CARE SERVICES TO MEMBERS
13-23 Art. 20B.061. SERVICE DELIVERY SYSTEM. (a) Each plan shall
13-24 provide or arrange for the provision of basic health services to
13-25 its members.
13-26 (b) The services provided by a plan shall be reasonably
13-27 accessible to its members with respect to geographic location,
14-1 hours of operation, and provision of after-hours services. This
14-2 subsection does not preclude the plan from providing or arranging
14-3 for the provision of member care within or outside the service area
14-4 of the plan for care that requires a higher level of skill or
14-5 specialty care than that which is available within the service
14-6 area.
14-7 (c) The plan shall cover emergency services at all times in
14-8 accordance with Article 20B.065 of this code.
14-9 (d) Each plan shall maintain appropriate systems as
14-10 necessary to monitor:
14-11 (1) member waiting time to get appointments with
14-12 participating providers;
14-13 (2) member telephone access to participating
14-14 providers; and
14-15 (3) the plan's arrangements for the provision of
14-16 emergency services.
14-17 Art. 20B.062. STANDARDS FOR DELIVERY OF CARE; MEMBER ACCESS.
14-18 (a) Each plan shall establish standards regarding the availability
14-19 of primary care providers to members and member access to services
14-20 provided through the plan, including access to:
14-21 (1) routine, urgent, and emergency care;
14-22 (2) a telephone appointment system;
14-23 (3) advice from providers; and
14-24 (4) other member telephone services.
14-25 (b) The plan's performance on member access to services
14-26 shall be assessed against the standards.
14-27 Art. 20B.063. HEALTH MANAGEMENT EFFORTS. (a) Each plan
15-1 shall take an active role in improving the health status of its
15-2 members and promoting effective health management by identifying
15-3 members with chronic illnesses and implementing appropriate
15-4 programmatic responses.
15-5 (b) The plan shall inform and educate each provider about
15-6 using the health management program for the members assigned to
15-7 that provider.
15-8 Art. 20B.064. MEDICAL RECORDS AND CONTINUITY OF CARE.
15-9 (a) A plan shall ensure continuity of care through:
15-10 (1) use of a health care professional who is primarily
15-11 responsible for coordinating the member's overall health care; and
15-12 (2) a system that maintains or ensures the maintenance
15-13 of necessary health and medical records that:
15-14 (A) accumulate pertinent information about each
15-15 member's health care; and
15-16 (B) are available to appropriate health care
15-17 professionals.
15-18 (b) A plan shall have policies and procedures governing the
15-19 maintenance of the health and medical records to ensure that those
15-20 records are maintained in a manner that:
15-21 (1) is current, detailed, and organized; and
15-22 (2) permits effective patient care and quality review.
15-23 (c) A plan shall ensure that:
15-24 (1) members' medical records are maintained so as to
15-25 ensure confidentiality, including written confidentiality policies
15-26 and procedures; and
15-27 (2) a member is afforded the opportunity to approve or
16-1 refuse the release of identifiable personal information except:
16-2 (A) to fulfill essential health plan functions
16-3 and obligations, including:
16-4 (i) quality improvement;
16-5 (ii) determining entitlement to health
16-6 care services;
16-7 (iii) administering payments; or
16-8 (iv) conducting approved, bona fide
16-9 medical education or research; or
16-10 (B) when the release is required by law.
16-11 Art. 20B.065. PAYMENT OF CERTAIN EMERGENCY SERVICES.
16-12 (a) The plan is financially responsible for, and shall provide
16-13 reasonable reimbursement for, necessary emergency services
16-14 required by a member, including services to treat and stabilize an
16-15 emergency medical condition that are obtained by a member from a
16-16 provider outside the plan, even if the services are provided
16-17 without prior authorization from the plan.
16-18 (b) The plan is financially responsible for the charges made
16-19 by a hospital emergency department for a medical screening
16-20 examination or other evaluation required by state or federal law
16-21 that is necessary to determine whether a medical emergency exists
16-22 for a member.
16-23 (c) After patient stabilization, the plan shall respond in a
16-24 timely manner appropriate to the circumstances of the case to
16-25 requests to provide additional services through the hospital
16-26 emergency department.
16-27 (d) On submission of written notice by a member of a valid
17-1 claim for medically necessary emergency care services, the plan
17-2 shall promptly reimburse the member for any amounts for which the
17-3 plan is obligated to pay.
17-4 Art. 20B.066. MEMBER RIGHTS AND RESPONSIBILITIES. (a) The
17-5 plan shall adopt written policies that recognize the rights of a
17-6 member to:
17-7 (1) voice grievances about the plan or the care
17-8 provided by the plan;
17-9 (2) be provided with information about the plan, its
17-10 services, the practitioners providing care, and members' rights and
17-11 responsibilities;
17-12 (3) participate in the decision-making regarding the
17-13 member's personal health care; and
17-14 (4) be treated with respect, recognizing the member's
17-15 dignity and need for privacy.
17-16 (b) The plan shall have written policies that address the
17-17 responsibility of a member to cooperate with providers providing
17-18 health care services. The written policy shall address the
17-19 member's responsibility to:
17-20 (1) provide, to the extent possible, information
17-21 needed by professional staff to care for the member; and
17-22 (2) follow instructions and guidelines given by those
17-23 providers.
17-24 (c) The plan shall provide a copy of its policies relating
17-25 to the rights and responsibilities of members on request to each
17-26 participating provider and directly to each subscriber.
17-27 Art. 20B.067. GRIEVANCE RESOLUTION. Each plan shall
18-1 establish, maintain, and inform each subscriber in writing of the
18-2 appeal and grievance procedures for each plan decision. The plan
18-3 shall have a formal system for resolving members' grievances that:
18-4 (1) establishes and monitors standards for timely
18-5 disposition of a grievance;
18-6 (2) documents the substance of a grievance and the
18-7 resulting actions taken;
18-8 (3) ensures a resolution of the grievance;
18-9 (4) establishes an appeals process:
18-10 (A) in which a member has the right to appear
18-11 before an appeals panel established by the plan and to request a
18-12 review of that panel's decision by different plan personnel; and
18-13 (B) that provides expedited procedures for
18-14 emergency situations;
18-15 (5) aggregates and analyzes information relating to
18-16 grievances and uses that information in its quality improvement
18-17 program; and
18-18 (6) ensures that a member who has filed a grievance or
18-19 an appeal is not the subject of retaliation or termination by the
18-20 plan solely because of that filing.
18-21 Art. 20B.068. DIRECT ACCESS. (a) The plan shall have a
18-22 written procedure to allow a member who has a chronic disabling or
18-23 life-threatening condition to apply to the plan's medical director
18-24 for direct access to specialty care appropriate to that member's
18-25 condition. The written procedure may include initial approval by
18-26 the member's primary care physician and the appropriate specialist.
18-27 (b) The medical director may set the conditions under which
19-1 the member may access the appropriate specialist directly.
19-2 (c) A member may appeal a denial of a request for direct
19-3 access through the appeals process required by this chapter.
19-4 (Articles 20B.069-20B.080 reserved for expansion
19-5 SUBCHAPTER F. PROTECTION AGAINST INSOLVENCY
19-6 Art. 20B.081. NO PRIVATE INTEREST. No individual or other
19-7 person may own an interest in a plan.
19-8 Art. 20B.082. NET WORTH; RETAINED EARNINGS. (a) Each
19-9 plan's total net worth shall represent retained earnings and other
19-10 capital sources. Retained earnings shall be used to:
19-11 (1) serve the plan's health care purposes;
19-12 (2) meet the plan's financial obligations, including
19-13 surplus notes arrangements; and
19-14 (3) provide benefits to the community at large or
19-15 support medical education or research.
19-16 (b) Each plan shall maintain a total net worth in an amount
19-17 determined by the commissioner to be adequate to provide services
19-18 to its members.
19-19 (c) The commissioner shall accept a plan's total net worth
19-20 as adequate if the plan's average net worth for the three years
19-21 preceding the date on which the plan applied to the department for
19-22 a certificate of authority to operate as an integrated health plan,
19-23 as reported in the annual statement filed by the plan with the
19-24 department under Article 20A.10, Texas Health Maintenance
19-25 Organization Act (Article 20A.10, Vernon's Texas Insurance Code),
19-26 has been at least $10 million.
19-27 Art. 20B.083. LIQUID ASSETS. Each plan shall maintain
20-1 sufficient cash or other liquid assets, or guarantee of liquid
20-2 assets, as necessary to meet the plan's financial obligations when
20-3 due.
20-4 Art. 20B.084. SOLVENCY PROTECTION PROGRAM. Each plan shall
20-5 adopt a solvency protection program that includes methods to
20-6 protect plan members from incurring liability for payment of fees
20-7 for health care services that are the legal obligation of the plan.
20-8 (Articles 20B.085-20B.100 reserved for expansion
20-9 SUBCHAPTER G. UTILIZATION MANAGEMENT
20-10 Art. 20B.101. UTILIZATION MANAGEMENT PROGRAM. (a) Each
20-11 plan shall adopt and maintain a written health care utilization
20-12 management program to ensure that the care provided to members is
20-13 appropriate, of high quality, and not based solely on economic
20-14 criteria.
20-15 (b) The program at a minimum must provide for the
20-16 accumulation and review of information relating to:
20-17 (1) new medical procedures and technologies;
20-18 (2) provider performance;
20-19 (3) health care services utilization;
20-20 (4) procedures for pre-authorization, if
20-21 pre-authorization is used; and
20-22 (5) concurrent review.
20-23 (c) The program must require that any pre-authorization
20-24 requirements and concurrent review are supervised by qualified
20-25 medical professionals and that any denial of care must be reviewed
20-26 by a licensed physician.
20-27 Art. 20B.102. PROCEDURES FOR DENIAL OF TREATMENT. (a) The
21-1 program must provide that:
21-2 (1) utilization management decisions are made in a
21-3 timely manner, depending on the urgency of the situation;
21-4 (2) the reasons for denial of treatment are clearly
21-5 documented and made available to the member or physician; and
21-6 (3) procedures for the appeal of a denial of treatment
21-7 are communicated to the affected member.
21-8 (b) The program must include a process for an appeal of an
21-9 adverse determination. The process must include the presentation
21-10 of information by and the opinion of the treating physician
21-11 regarding the determination. If the decision to deny coverage was
21-12 based on a determination of lack of medical necessity, the appeal
21-13 must be decided by a physician.
21-14 (c) Unless the determination involves a life-threatening or
21-15 emergency situation, an appeal of an adverse determination must be
21-16 resolved not later than the 30th day after the date of receipt of
21-17 all necessary medical information. If the determination involves a
21-18 life-threatening or emergency situation, the appeal must be decided
21-19 on an expedited basis as provided by Subsection (d) of this
21-20 article.
21-21 (d) The program must include an expedited process for an
21-22 appeal of denial of treatment for a member with a life-threatening
21-23 condition. A complaint of denial of treatment that is subject to
21-24 this subsection must be resolved not later than the seventh day
21-25 after receipt of the complaint. An appeal of a determination made
21-26 under this subsection must be resolved not later than the seventh
21-27 day after the date of receipt of the appeal request.
22-1 Art. 20B.103. HOSPITAL STAY. (a) The program shall ensure
22-2 that the determination of the appropriate length of stay in a
22-3 hospital, including hospitalization provided under maternity
22-4 benefits, is made by the attending physician and the patient,
22-5 taking into consideration any special needs of the patient and, in
22-6 the case of maternity benefits, any special needs of the infant.
22-7 (b) The determination of the appropriate length of stay in a
22-8 hospital may not be based on economic criteria.
22-9 (Articles 20B.104-20B.120 reserved for expansion
22-10 SUBCHAPTER H. OPERATION OF INTEGRATED HEALTH PLAN
22-11 Art. 20B.121. DETERMINATION OF MEDICAL NECESSITY. (a) An
22-12 integrated health plan shall have written policies and procedures
22-13 for making determinations as to whether a medical treatment is
22-14 medically necessary, experimental or investigational, or covered
22-15 under the terms of the health coverage provided by the plan. Those
22-16 policies and procedures must comply with this subchapter.
22-17 (b) The medical director of the integrated health plan, who
22-18 must be a physician licensed to practice medicine in this state and
22-19 employed by the applicable group medical practice, shall render or
22-20 approve a determination described by Subsection (a) of this
22-21 article. The medical director may delegate this responsibility to
22-22 one or more physicians who are licensed to practice medicine in
22-23 this state and are employed by or affiliated with the group medical
22-24 practice.
22-25 (c) The integrated health plan or group medical practice
22-26 shall subscribe or have access to an organized technology
22-27 assessment service that is independent from the plan and group
23-1 medical practice.
23-2 (d) The integrated health plan or group medical practice
23-3 shall have a committee composed of licensed physicians of the group
23-4 medical practice and, as necessary, other types of licensed medical
23-5 professionals that serve as an advisory body to the medical
23-6 director in making determinations of whether a medical treatment is
23-7 medically necessary or experimental or investigational.
23-8 (e) Before deciding that a medical treatment is not
23-9 medically necessary, is experimental or investigational, or is not
23-10 covered under the terms of the policy of health coverage, the
23-11 medical director, or the medical director's designee, shall perform
23-12 one or more of the following actions, as appropriate to the
23-13 circumstances and time constraints of the case:
23-14 (1) review the patient's medical record;
23-15 (2) review the patient's case with a physician of the
23-16 same or similar specialty as the physician recommending the
23-17 treatment in question;
23-18 (3) review relevant reports or findings of the
23-19 technology assessment service described under Subsection (c) of
23-20 this article; or
23-21 (4) consult with the advisory committee described
23-22 under Subsection (d) of this article.
23-23 (f) If the medical director or the medical director's
23-24 designee renders or approves a negative decision about a medical
23-25 treatment and the integrated health plan declines to provide
23-26 coverage for the treatment, the affected member may appeal the
23-27 decision through the grievance resolution procedure required under
24-1 this chapter.
24-2 Art. 20B.122. LIABILITY. (a) An integrated health plan
24-3 that complies with the policies and procedures required under
24-4 Article 20B.121 of this code is not liable for personal injury,
24-5 property damage, or death that arises as a result of the decision
24-6 by the plan to cover or not cover a treatment. If the member or
24-7 the member's provider fails to request approval from the plan for
24-8 the treatment until after the treatment is performed, the plan is
24-9 not liable for personal injury, property damage, or death that
24-10 arises as a result of the decision by the integrated health plan to
24-11 cover or not cover the treatment.
24-12 (b) An integrated health plan and the group medical practice
24-13 may indemnify the other with respect to a negligent act or
24-14 omission. The plan may not require any provider who is not
24-15 affiliated with the group medical practice to indemnify the plan
24-16 for its negligent act or omission.
24-17 Art. 20B.123. APPLICATION OF INSURANCE LAWS. (a) Except as
24-18 provided by this article, an integrated health plan is exempt from
24-19 the operation and application of all insurance laws of this state,
24-20 including this code.
24-21 (b) An integrated health plan is subject to the following
24-22 laws as those laws existed on January 15, 1997:
24-23 (1) the Texas Health Maintenance Organization Act
24-24 (Chapter 20A, Vernon's Texas Insurance Code);
24-25 (2) Chapter 26, Insurance Code;
24-26 (3) Articles 1.04, 1.10, 1.10A, 1.10B, 1.10E, 1.11,
24-27 1.14-1, 1.15A, 1.19-1, 1.24C, 1.24D, 1.28, 1.31, 1.31A, 1.33,
25-1 1.33B, 1.41, 3.51-5A, 3.51-6B, 3.51-6C, and 3.51-10, Insurance
25-2 Code;
25-3 (4) Section 1(F)(5), Chapter 397, Acts of the 54th
25-4 Legislature, Regular Session, 1955 (Article 3.70-1, Vernon's Texas
25-5 Insurance Code);
25-6 (5) Sections 2(F), (G), and (L), Chapter 397, Acts of
25-7 the 54th Legislature, Regular Session, 1955 (Article 3.70-2,
25-8 Vernon's Texas Insurance Code);
25-9 (6) Articles 3.72, 3.74, 3.77, 21.21-2, 21.21-4,
25-10 21.46, and 21.52C, Insurance Code;
25-11 (7) Article 21.21-6, Insurance Code, as added by
25-12 Chapter 522, Acts of the 74th Legislature, Regular Session, 1995;
25-13 (8) Article 21.52D, Insurance Code, as added by
25-14 Chapter 935, Acts of the 73rd Legislature, Regular Session, 1993;
25-15 (9) Articles 21.53A, 21.53C, 21.58A, 21.71, and
25-16 21.79D, Insurance Code;
25-17 (10) Sections 2(a) and 4(a), Article 1.36, Insurance
25-18 Code;
25-19 (11) Section 5(e), Texas Employees Uniform Group
25-20 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
25-21 Code);
25-22 (12) Section 4(b)(4)(D), Texas State College and
25-23 University Employees Uniform Insurance Benefits Act (Article
25-24 3.50-3, Vernon's Texas Insurance Code);
25-25 (13) Section 3A, Article 3.51-6, Insurance Code;
25-26 (14) Section 3C, Article 3.51-6, as added by Chapter
25-27 1041, Acts of the 71st Legislature, Regular Session, 1989;
26-1 (15) Article 21.07-6, Insurance Code, except Sections
26-2 4, 5, 10, and 20(a)(1); and
26-3 (16) Section 5, Article 21.53, Insurance Code.
26-4 (c) An amendment to a law listed in Subsection (b) of this
26-5 article applies to an integrated health plan only if specifically
26-6 made applicable to an integrated health plan in its enactment.
26-7 (d) No provision of this code or other laws, other than
26-8 those listed by Subsection (b) of this article, whether existing
26-9 on or enacted after January 15, 1997, apply to an integrated health
26-10 plan unless that law is expressly added to that list.
26-11 (e) Unless this subsection is specifically amended to the
26-12 contrary, a law or rule, regardless of its effective date, may not
26-13 prohibit or in any way restrict an integrated health plan from:
26-14 (1) selectively contracting with or declining to
26-15 contract with any or all providers as the integrated health plan
26-16 considers necessary;
26-17 (2) contracting for or declining to contract for an
26-18 individual health care service or full range of health care
26-19 services as the integrated health plan considers necessary, if the
26-20 service or services may be legally provided by the contracting
26-21 provider; or
26-22 (3) requiring enrolled members of the integrated
26-23 health plan who wish to obtain the services covered by the
26-24 integrated health plan to use the providers specified by the
26-25 integrated health plan.
26-26 SECTION 2. This Act takes effect September 1, 1997.
26-27 SECTION 3. The importance of this legislation and the
27-1 crowded condition of the calendars in both houses create an
27-2 emergency and an imperative public necessity that the
27-3 constitutional rule requiring bills to be read on three several
27-4 days in each house be suspended, and this rule is hereby suspended.