1-1     By:  Nelson                                            S.B. No. 130
 1-2           (In the Senate - Filed January 7, 1999; January 28, 1999,
 1-3     read first time and referred to Committee on Economic Development;
 1-4     March 1, 1999, reported adversely, with favorable Committee
 1-5     Substitute by the following vote:  Yeas 5, Nays 0; March 1, 1999,
 1-6     sent to printer.)
 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 130                    By:  Madla
 1-8                            A BILL TO BE ENTITLED
 1-9                                   AN ACT
1-10     relating to certain unfair practices by insurers and certain
1-11     related entities regarding preferred providers of health care.
1-12           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13           SECTION 1.  Article 3.70-3C,  Insurance Code, as added by
1-14     Chapter 1024, Acts of the 75th Legislature, Regular Session, 1997,
1-15     is amended by adding Section 7A to read as follows:
1-16           Sec. 7A.  RESTRICTIONS ON PAYMENT AND REIMBURSEMENT.
1-17           (a)  This section applies to:
1-18                 (1)  an insurer;
1-19                 (2)  an agent of an insurer;
1-20                 (3)  an administrator regulated under Article 21.07-6
1-21     of this code; or
1-22                 (4)  a preferred provider organization.
1-23           (b)  A person to whom this section applies shall not
1-24     reimburse a physician, practitioner, hospital, institutional
1-25     provider, or organization of physicians and health care providers
1-26     on a discounted fee basis for covered services that are rendered to
1-27     an insured unless the insured is covered by a preferred provider
1-28     benefit plan to which the physician, practitioner, hospital,
1-29     institutional provider, or organization of physicians and health
1-30     care providers has contracted and to which the person has agreed to
1-31     provide coverage.
1-32           (c)  No party to a preferred provider contract may buy,
1-33     purchase, acquire, obtain, lease, rent, or otherwise transfer
1-34     information concerning the payment or reimbursement terms of the
1-35     contract without express authority and prior adequate notification
1-36     to contracted parties.
1-37           (d)  A person who violates this section commits an unfair act
1-38     or deceptive practice in violation of Articles 21.21 and 21.21-2 of
1-39     this code.
1-40           SECTION 2.  The importance of this legislation and the
1-41     crowded condition of the calendars in both houses create an
1-42     emergency and an imperative public necessity that the
1-43     constitutional rule requiring bills to be read on three several
1-44     days in each house be suspended, and this rule is hereby suspended,
1-45     and that this Act take effect and be in force from and after its
1-46     passage, and it is so enacted.
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