By Averitt H.B. No. 1609
77R6595 T
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to scheduled benefit review and utilization review.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Chapter 21, Insurance Code, is amended by adding
1-5 Article 21.53X which reads as follows:
1-6 Sec. 1. In this article:
1-7 (1) "Enrollee" means an individual enrolled in a
1-8 health benefit plan or a person with the authority to act on behalf
1-9 of an enrollee such as a parent or guardian. The definition of
1-10 enrollee does not include a health care provider acting on behalf
1-11 of an enrollee as described in Sec. 3(b) of this article.
1-12 (2) "Health benefit plan" means a plan described by
1-13 Section 2 of this article.
1-14 (3) "Health care provider" means any practitioner,
1-15 institutional provider, or other person or organization that
1-16 furnishes health care services and that is licensed or otherwise
1-17 authorized to practice in this state.
1-18 (4) "Scheduled benefit" means a service, treatment or
1-19 supply that is described as a benefit in an enrollee's health
1-20 benefit plan.
1-21 (5) "Scheduled benefit review" means a review
1-22 conducted by the issuer of a health benefit plan or, at the
1-23 designation of the issuer of the health benefit plan, by a third
1-24 party administrator or a utilization review agent to determine if a
2-1 service, treatment or supply being requested by an enrollee is a
2-2 scheduled benefit.
2-3 (6) "Third party administrator" means an entity
2-4 licensed pursuant to Article 21.07-6 of this code.
2-5 (7) "Utilization review" means utilization review
2-6 conducted pursuant to Article 21.58A of this code.
2-7 (8) "Utilization review agent" means a utilization
2-8 review agent as defined in Article 21.58A of this code.
2-9 Sec. 2. (a) This article applies only to a health benefit
2-10 plan that:
2-11 (1) provides benefits for expenses incurred or
2-12 services provided as a result of a health condition, accident, or
2-13 sickness, including:
2-14 (A) an individual, group, blanket, or franchise
2-15 insurance policy, certificate or insurance agreement, a group
2-16 hospital service contract, or an individual or group evidence of
2-17 coverage that is issued by:
2-18 (i) an insurance company;
2-19 (ii) a group hospital service corporation
2-20 operating under Chapter 20 of this code;
2-21 (iii) a fraternal benefit society
2-22 operating under Chapter 10 of this code;
2-23 (iv) a stipulated premium insurance
2-24 company operating under Chapter 22 of this code;
2-25 (v) a Lloyd's plan operating under Chapter
2-26 18 of this code;
2-27 (vi) reciprocal or inter-insurance
3-1 exchanges operating under Chapter 19 of this code;
3-2 (vii) a health maintenance organization
3-3 operating under Chapter 20A of this code);
3-4 (B) a multiple employer welfare arrangement that
3-5 holds a certificate of authority under Article 3.95-2 of this code;
3-6 (2) is issued by an approved nonprofit health
3-7 corporation that is certified under Section 162.001, Occupations
3-8 Code, and that holds a certificate of authority issued by the
3-9 commissioner under Article 21.52F of this code.
3-10 (b) This article does not apply to:
3-11 (1) a plan that provides coverage:
3-12 (A) only for accidental death or dismemberment;
3-13 (B) for wages or payments in lieu of wages for a
3-14 period during which an employee is absent from work because of
3-15 sickness or injury;
3-16 (C) as a supplement to liability insurance;
3-17 (D) for credit insurance; or
3-18 (E) only for indemnity for hospital; or
3-19 (2) workers' compensation insurance coverage;
3-20 (3) medical payment insurance issued as part of a
3-21 motor vehicle insurance policy;
3-22 (4) a self-insured political subdivision plan; or
3-23 (5) a self-insured single employer plan.
3-24 Sec. 3. (a) An issuer of a health benefit plan shall, upon
3-25 request of the enrollee or a health care provider acting on behalf
3-26 of the enrollee, conduct a scheduled benefit review.
3-27 (b) For purposes of this article, a health care
4-1 provider is considered to be acting on behalf of an enrollee if:
4-2 (1) the enrollee has provided written consent that:
4-3 (A) authorizes that specific health care
4-4 provider to obtain on behalf of the enrollee a scheduled benefit
4-5 review; and
4-6 (B) identifies the services, treatment, or
4-7 supplies for which the scheduled benefit review is being requested;
4-8 (2) the health care provider is either:
4-9 (A) a preferred provider, as defined in Article
4-10 3.70-3C Sec. (1)(10) of this code, for the enrollee's health
4-11 benefit plan; or
4-12 (B) part of a health maintenance organization
4-13 delivery network as defined in Article 20A.02(w) of this code that
4-14 has contracted directly or indirectly to provide health care
4-15 services for the enrollee's health benefit plan; or
4-16 (3) the enrollee or the health care provider is
4-17 requesting the review as part of utilization review.
4-18 (c) An issuer of a health benefit plan that conducts a
4-19 scheduled benefit review shall provide a written notification to
4-20 the enrollee and, if the request for the review was made by a
4-21 health care provider acting on behalf of the enrollee, to the
4-22 requesting health care provider, of a determination made in a
4-23 scheduled benefit review.
4-24 (d) The written notification shall be mailed or otherwise
4-25 transmitted not later than 3 business days after a request for a
4-26 review under this article has been received by the issuer of the
4-27 health benefit plan.
5-1 (e) The commissioner shall establish by rule the elements
5-2 that a written notification must contain, including:
5-3 (1) a statement as to whether the enrollee is
5-4 currently enrolled in the health benefit plan;
5-5 (2) a description of the services, treatment or
5-6 supplies being requested;
5-7 (3) a statement as to whether the services, treatment
5-8 or supplies being requested are a scheduled benefit under the
5-9 enrollee's health benefit plan; and
5-10 (4) if the services, treatment or supplies are
5-11 determined to be a scheduled benefit:
5-12 (A) a statement regarding, if applicable, any
5-13 annual, lifetime or benefit maximums and the balance available to
5-14 the enrollee for the scheduled benefit.
5-15 (B) a disclosure, which contents shall be
5-16 developed by the commissioner, explaining that payment for
5-17 scheduled benefits may be affected by other factors.
5-18 Sec. 4. (a) An issuer of a health benefit plan may delegate
5-19 its third party administrator or its utilization review agent to
5-20 perform a scheduled benefit review required by this article.
5-21 (b) A utilization review agent that includes the elements
5-22 required in ___________ of this article in the written notification
5-23 issued pursuant to Section 5 of Article 21.58A shall be deemed to
5-24 have complied with this article. The portion of a written
5-25 notification issued by a utilization review agent that constitutes
5-26 a determination of a scheduled benefit review shall be deemed a
5-27 written notification issued pursuant to this article.
6-1 Sec 5. The commissioner may adopt reasonable rules as
6-2 necessary to implement this article which may include rules
6-3 addressing:
6-4 (a) the manner in which an enrollee or a health care
6-5 provider acting on the enrollee's behalf may request a scheduled
6-6 benefit review; and
6-7 (b) limitations on the amounts and types of information a
6-8 health plan issuer can require the enrollee or a health care
6-9 provider acting on the enrollee's behalf to provide in support of a
6-10 request.
6-11 SECTION 2. Section 2, Article 21.58A, Insurance Code, Sec. 2
6-12 is amended to read as follows:
6-13 Sec. 2. In this article:
6-14 (1) "Administrative procedure act" means Chapter 2001,
6-15 Government Code.
6-16 (2) "Administrator" means a person holding a
6-17 certificate of authority under Article 21.07-6 of this code.
6-18 (3) "Affirmative determination" means a determination
6-19 by a utilization review agent that the health care services being
6-20 furnished or proposed to be furnished to a patient are medically
6-21 necessary.
6-22 (4) [(3)] "Adverse determination" means a
6-23 determination by a utilization review agent that the health care
6-24 services furnished or proposed to be furnished to a patient are not
6-25 medically necessary.
6-26 (5) "Calendar day" means the consecutive day following
6-27 the preceding day.
7-1 (6) [(4)] "Certificate" means a certificate of
7-2 registration granted by the commissioner to a utilization review
7-3 agent.
7-4 (7) [(5)] "Commissioner" means the commissioner of
7-5 insurance.
7-6 (8) [(6)] "Emergency care" means health care services
7-7 provided in a hospital emergency facility or comparable facility to
7-8 evaluate and stabilize medical conditions of a recent onset and
7-9 severity, including but not limited to severe pain, that would lead
7-10 a prudent layperson possessing an average knowledge of medicine and
7-11 health to believe that his or her condition, sickness, or injury is
7-12 of such a nature that failure to get immediate medical care could
7-13 result in:
7-14 (A) placing the patient's health in serious
7-15 jeopardy;
7-16 (B) serious impairment to bodily functions;
7-17 (C) serious dysfunction of any bodily organ or
7-18 part;
7-19 (D) serious disfigurement; or
7-20 (E) in the case of a pregnant woman, serious
7-21 jeopardy to the health of the fetus.
7-22 (9) [(7)] "Dental plan" means an insurance policy or
7-23 health benefit plan, including a policy written by a company
7-24 subject to Chapter 20 of this code, that provides coverage for
7-25 expenses for dental services.
7-26 (10) [(8)] "Enrollee" means a person covered by a
7-27 health insurance policy or plan and includes a person who is
8-1 covered as an eligible dependent of another person.
8-2 (11) [(9)] "Health benefit plan" means a plan of
8-3 benefits that defines the coverage provisions for health care for
8-4 enrollees offered or provided by any organization, public or
8-5 private, other than health insurance.
8-6 (12) [(10)] "Health care provider" means any person,
8-7 corporation, facility, or institution licensed by a state to
8-8 provide or otherwise lawfully providing health care services that
8-9 is eligible for independent reimbursement for those services.
8-10 (13) [(11)] "Health insurance policy" means an
8-11 insurance policy, including a policy written by a company subject
8-12 to Chapter 20 of this code, that provides coverage for medical or
8-13 surgical expenses incurred as a result of accident or sickness.
8-14 (14) [(12)] "Life threatening" means a disease or
8-15 condition for which the likelihood of death is probable unless the
8-16 course of the disease or condition is interrupted.
8-17 (15) [(13)] "Nurse" means a professional or registered
8-18 nurse, a licensed vocational nurse, or a licensed practical nurse.
8-19 (16) [(14)] "Open meetings law" means Chapter 551,
8-20 Government Code.
8-21 (17) [(15)] "Open records law" means Chapter 552,
8-22 Government Code.
8-23 (18) [(16)] "Patient" means the enrollee or an
8-24 eligible dependent of the enrollee under a health benefit plan or
8-25 health insurance plan.
8-26 (19) [(17)] "Payor" means:
8-27 (A) an insurer writing health insurance
9-1 policies;
9-2 (B) any preferred provider organization, health
9-3 maintenance organization, self-insurance plan; or
9-4 (C) any other person or entity which provides,
9-5 offers to provide, or administers hospital, outpatient, medical, or
9-6 other health benefits to persons treated by a health care provider
9-7 in this state pursuant to any policy, plan, or contract.
9-8 (19) [(17)] "Physician" means a licensed doctor of
9-9 medicine or a doctor of osteopathy.
9-10 (20) [(18)] "Provider of record" means the physician
9-11 or other health care provider that has primary responsibility for
9-12 the care, treatment, and services rendered to the enrollee and
9-13 includes any health care facility when treatment is rendered on an
9-14 inpatient or outpatient basis.
9-15 (21) [(19)] "Utilization review" means a system for
9-16 prospective or concurrent review of the medical necessity and
9-17 appropriateness of health care services being provided or proposed
9-18 to be provided to an individual within this state. Utilization
9-19 review shall not include elective requests for clarification of
9-20 coverage.
9-21 (22) [(20)] "Utilization review agent" means an entity
9-22 that conducts utilization review for:
9-23 (A) an employer with employees in this state who
9-24 are covered under a health benefit plan or health insurance policy;
9-25 (B) a payor; or
9-26 (C) an administrator.
9-27 (23) [(21)] "Utilization review plan" means the
10-1 screening criteria and utilization review procedures of a
10-2 utilization review agent.
10-3 (24) [(22)] "Working day" means a weekday, excluding a
10-4 legal holiday.
10-5 SECTION 3. Section 5 of Article 21.58A, Insurance Code, is
10-6 amended to read as follows:
10-7 Sec. 5. (a) A utilization review agent shall unless
10-8 otherwise permitted by rule provide written notification to
10-9 [notify] the enrollee or a person acting on behalf of the enrollee
10-10 and the enrollee's provider of record of a determination made in a
10-11 utilization review. The commissioner by rule may permit a
10-12 utilization review agent to provide written notification only to
10-13 the enrollee or a person acting on behalf of the enrollee or only
10-14 to the enrollee's provider of record in certain circumstances.
10-15 (b) In the event of an affirmative determination, the [The]
10-16 written notification required by this section must be mailed or
10-17 otherwise transmitted not later than two working days after the
10-18 date of the request for utilization review and all information
10-19 necessary to complete the review is received by the agent.
10-20 (c) A written notification of an affirmative determination
10-21 must include:
10-22 (1) a statement that the services being furnished or
10-23 proposed to be furnished have been determined to be medically
10-24 necessary;
10-25 (2) a description of the services that have been
10-26 determined to be medically necessary including, if appropriate, a
10-27 description of the facility or setting in which the services are to
11-1 be performed.
11-2 (3) a disclosure, which contents shall be developed by
11-3 the commissioner, explaining that payment for scheduled benefits
11-4 may be affected by other factors.
11-5 (d) [(c)] In the event of an adverse determination, the
11-6 notification by the utilization review agent must include:
11-7 (1) the principal reasons for the adverse
11-8 determination;
11-9 (2) the clinical basis for the adverse determination;
11-10 (3) a description or the source of the screening
11-11 criteria that were utilized as guidelines in making the
11-12 determination; and
11-13 (4) a description of the procedure for the complaint
11-14 and appeal process, including:
11-15 (A) notification to the enrollee of the
11-16 enrollee's right to appeal an adverse determination to an
11-17 independent review organization;
11-18 (B) notification to the enrollee of the
11-19 procedures for appealing an adverse determination to an independent
11-20 review organization; and
11-21 (C) notification to an enrollee who has a
11-22 life-threatening condition of the enrollee's right to an immediate
11-23 review by an independent review organization and the procedures to
11-24 obtain that review.
11-25 (e) [(d)] The notification of adverse determination required
11-26 by this section shall be provided by the utilization review agent:
11-27 (1) within one calendar [working] day by telephone or
12-1 electronic transmission to the provider of record in the case of a
12-2 patient who is hospitalized at the time of the adverse
12-3 determination, to be followed within three working days by written
12-4 notification to [a letter notifying] the enrollee or a person
12-5 acting on behalf of the enrollee [patient] and if, the original
12-6 notification to the provider was not in writing, to the provider of
12-7 record of an adverse determination [within three working days];
12-8 (2) within three working days by written notification
12-9 [in writing] to the provider of record and the patient if the
12-10 patient is not hospitalized at the time of the adverse
12-11 determination; or
12-12 (3) within the time appropriate to the circumstances
12-13 relating to the delivery of the services and the condition of the
12-14 patient, but in no case to exceed one hour from notification when
12-15 denying poststabilization care subsequent to emergency treatment as
12-16 requested by a treating physician or provider. In such
12-17 circumstances, notification of an adverse determination shall be
12-18 provided to the treating physician or health care provider to be
12-19 followed within three working days by written notification to the
12-20 enrollee or a person acting on behalf of the enrollee and if, the
12-21 original notification to the provider was not in writing, the
12-22 provider of record.
12-23 SECTION 4. Section 7, Article 21.58A, Insurance Code, is
12-24 amended to read as follows:
12-25 Sec. 7. (a) A utilization review agent shall have
12-26 appropriate personnel reasonably available by toll-free telephone
12-27 [at least 40 hours per week during normal business hours in Texas]
13-1 to discuss patients' care, [and] allow response to telephone review
13-2 requests and provide the notification required by Section 5 of this
13-3 article.
13-4 (b) A utilization review agent that fails to provide the
13-5 notification of an adverse determination required by Section 5(d)
13-6 of this article within the time periods required by Section 5(e) of
13-7 this article shall be deemed to have made an affirmative
13-8 determination of the services for which review was requested and
13-9 shall provide the written notification required by Section 5(c) of
13-10 this article [have a telephone system capable of accepting or
13-11 recording or providing instructions to incoming phone calls during
13-12 other than normal business hours and shall respond to such calls
13-13 not later than two working days of the later of the date on which
13-14 the call was received or the date the details necessary to respond
13-15 have been received from the caller].
13-16 (c) A utilization review agent must provide a written
13-17 description to the commissioner setting forth the procedures to be
13-18 used when responding to poststabilization care subsequent to
13-19 emergency treatment as requested by a treating physician or health
13-20 care provider.
13-21 SECTION 5. Section 11, Article 21.58A, Insurance Code is
13-22 amended by adding Subsections (c), (d) and (e) to read as follows:
13-23 (c) When a prospective utilization review is made of
13-24 services proposed to be furnished which results in an affirmative
13-25 determination a utilization review agent, a health maintenance
13-26 organization or an insurer subject to this article shall not
13-27 subsequently make a retrospective review of the services which were
14-1 the subject of the affirmative determination.
14-2 (d) When a concurrent utilization review is made of services
14-3 which are being furnished which results in an affirmative
14-4 determination a utilization review agent, a health maintenance
14-5 organization or an insurer subject to this article shall not
14-6 subsequently make a retrospective review of the services which were
14-7 the subject of the affirmative determination.
14-8 (e) When a utilization review is made of services that are
14-9 being furnished or proposed to be furnished which results in an
14-10 affirmative determination, any request for review of an extension
14-11 of those services must be made by utilization review.
14-12 SECTION 6. This Act takes effect September 1, 2001 however
14-13 health benefit plan issuers are not required to provide a scheduled
14-14 benefit review as provided by Section 1 of this Act until January
14-15 1, 2002. Sections 2 through 5 of this Act applies only to a
14-16 utilization review conducted on or after January 1, 2002.