By:  Nelson                                            S.B. No. 130
                                A BILL TO BE ENTITLED
                                       AN ACT
 1-1     relating to certain unfair practices by insurers and certain
 1-2     related entities regarding preferred providers of health care.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Article 3.70-3C,  Insurance Code, as added by
 1-5     Chapter 1024, Acts of the 75th Legislature, Regular Session, 1997,
 1-6     is amended by adding Section 7A to read as follows:
 1-7           Sec. 7A.  RESTRICTIONS ON PAYMENT AND REIMBURSEMENT.
 1-8     (a)  Except as provided by Subsection (b) of this section, an
 1-9     insurer or third party administrator may not reimburse a physician,
1-10     practitioner, hospital, institutional provider, or organization of
1-11     physicians and health care providers on a discounted fee basis for
1-12     covered services that are provided to an insured unless:
1-13                 (1)  the insurer or third party administrator has
1-14     contracted with the physician, practitioner, hospital,
1-15     institutional provider, or organization of physicians and health
1-16     care providers;
1-17                 (2)  the physician, practitioner, hospital,
1-18     institutional provider, or organization of physicians and health
1-19     care providers has agreed to the contract and has agreed to provide
1-20     health care services under the terms of the contract; and
1-21                 (3)  the insurer or third party administrator has
1-22     agreed to provide coverage for those health care services under the
1-23     health insurance policy.
1-24           (b)  A party to a preferred provider contract may not sell,
 2-1     lease, or otherwise transfer information regarding the payment or
 2-2     reimbursement terms of the contract without the express authority
 2-3     and prior adequate notification of the other contracting parties.
 2-4     This subsection does not affect the  commissioner's authority under
 2-5     this code to request and obtain information.
 2-6           (c)  An insurer or third party administrator who violates
 2-7     this section commits an unfair act or deceptive practice in
 2-8     violation of Articles 21.21 and 21.21-2 of this code.
 2-9           SECTION 2.  The importance of this legislation and the
2-10     crowded condition of the calendars in both houses create an
2-11     emergency and an imperative public necessity that the
2-12     constitutional rule requiring bills to be read on three several
2-13     days in each house be suspended, and this rule is hereby suspended,
2-14     and that this Act take effect and be in force from and after its
2-15     passage, and it is so enacted.