By Eiland, Janek, Lewis of Tarrant,                   H.B. No. 1862
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the regulation and prompt payment of health care
 1-3     providers under certain health benefit plans.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF STATE OF TEXAS:
 1-5           SECTION 1. Section 1, Article 3.70-3C, Insurance Code, as
 1-6     added by Chapter 1024, Acts of the 75th Legislature, Regular
 1-7     Session, 1997, is amended by adding Subdivisions (14) and (15) to
 1-8     read as follows:
 1-9                 (14)  "Preauthorization" means a determination by the
1-10     insurer that the medical care or health care services proposed to
1-11     be provided to a patient are medically necessary and appropriate.
1-12                 (15)  "Verification" means a reliable representation by
1-13     an insurer to a physician or health care provider that the insurer
1-14     will pay the physician or health care provider for proposed medical
1-15     care or health care services if the physician or health care
1-16     provider renders those services to the patient for whom the
1-17     services are proposed. The term includes precertification,
1-18     certification, recertification, or any other term that would be a
1-19     reliable representation by an insurer to a physician or health care
1-20     provider.
1-21           SECTION 2. Section 3A, Article 3.70-3C, Insurance Code, as
1-22     added by Chapter 1024, Acts of the 75th Legislature, Regular
1-23     Session, 1997, is amended to read as follows:
1-24           Sec. 3A.  PROMPT PAYMENT OF PREFERRED PROVIDERS. (a)  In this
1-25     section, "clean claim" means a [completed] claim that complies with
 2-1     Section 3B of this article[, as determined under department rules,
 2-2     submitted by a preferred provider for medical care or health care
 2-3     services under a health insurance policy].
 2-4           (b)  A physician or provider must submit a claim to an
 2-5     insurer not later than the 95th day after the date the physician or
 2-6     provider provides the medical care or health care services for
 2-7     which the claim is made.  An insurer shall accept as proof of
 2-8     timely filing a claim filed in compliance with Subsection (c) of
 2-9     this section or information from another insurer showing that the
2-10     physician or provider submitted the claim to the insurer in
2-11     compliance with Subsection (c) of this section.  If a physician or
2-12     provider fails to submit a claim in compliance with this
2-13     subsection, the physician or provider forfeits the right to
2-14     payment.  The period for submitting a claim under this subsection
2-15     may be extended by contract.  A physician or provider may not
2-16     submit a duplicate claim for payment before the 46th day after the
2-17     date the original claim was submitted.  The commissioner shall
2-18     adopt rules under which an insurer may determine whether a claim is
2-19     a duplicate claim [A preferred provider for medical care or health
2-20     care services under a health insurance policy may obtain
2-21     acknowledgment of receipt of a claim for medical care or health
2-22     care services under a health care plan by submitting the claim by
2-23     United States mail, return receipt requested.  An insurer or the
2-24     contracted clearinghouse of an insurer that receives a claim
2-25     electronically shall acknowledge receipt of the claim by an
2-26     electronic transmission to the preferred provider and is not
2-27     required to acknowledge receipt of the claim by the insurer in
 3-1     writing].
 3-2           (c)  A physician or provider shall, as appropriate:
 3-3                 (1)  mail a claim by United States mail, first class,
 3-4     or by overnight delivery service, and maintain a log of mailed
 3-5     claims and include a copy of the log with the relevant mailed
 3-6     claim;
 3-7                 (2)  submit the claim electronically and maintain a log
 3-8     of electronically submitted claims;
 3-9                 (3)  fax the claim and maintain a log of all faxed
3-10     claims; or
3-11                 (4)  hand deliver the claim and maintain a log of all
3-12     hand-delivered claims.
3-13           (d)  If a claim for medical care or health care services
3-14     under a health care plan is mailed, the claim is presumed to have
3-15     been received by the insurer on the third day after the date the
3-16     claim is mailed or, if the claim is mailed using overnight service
3-17     or return receipt requested, on the date the delivery receipt is
3-18     signed.  If the claim is submitted electronically, the claim is
3-19     presumed to have been received on the date of the electronic
3-20     verification of receipt by the insurer or the insurer's
3-21     clearinghouse.  If the insurer or the insurer's clearinghouse does
3-22     not provide a confirmation within 24 hours of submission by the
3-23     physician or provider, the physician's or provider's clearinghouse
3-24     shall provide the confirmation.  The physician's or provider's
3-25     clearinghouse must be able to verify that the filing contained the
3-26     correct address of the entity to receive the filing.  If the claim
3-27     is faxed, the claim is presumed to have been received on the date
 4-1     of the transmission acknowledgment. If the claim is hand delivered,
 4-2     the claim is presumed to have been received on the date the
 4-3     delivery receipt is signed.  The commissioner shall promulgate a
 4-4     form to be submitted by the physician or provider that easily
 4-5     identifies all claims included in each filing and that can be used
 4-6     by a physician or provider as the physician's or provider's log.
 4-7           (e)  Not later than the 45th day after the date that the
 4-8     insurer receives a clean claim from a preferred provider, the
 4-9     insurer shall make a determination of whether the claim is eligible
4-10     for payment and:
4-11                 (1)  if the insurer determines the entire claim is
4-12     eligible for payment, pay the total amount of the claim in
4-13     accordance with the contract between the preferred provider and the
4-14     insurer;
4-15                 (2)  if the insurer disputes a portion of the claim,
4-16     pay the portion of the claim that is not in dispute and notify the
4-17     preferred provider in writing why the remaining portion of the
4-18     claim will not be paid; or
4-19                 (3)  if the insurer determines that the claim is not
4-20     eligible for payment, notify the preferred provider in writing why
4-21     the claim will not be paid.
4-22           (f)  Not later than the 21st day after the date an insurer
4-23     affirmatively adjudicates a pharmacy benefit claim that is
4-24     electronically submitted, the insurer shall:
4-25                 (1)  pay the total amount of the claim; or
4-26                 (2)  notify the benefit provider of the reasons for
4-27     denying payment of the claim.
 5-1           (g)  An insurer that determines under Subsection (e) of this
 5-2     section that a claim is eligible for payment and does not pay the
 5-3     claim on or before the 45th day after the date the insurer receives
 5-4     a clean claim commits an unfair claim settlement practice in
 5-5     violation of Article 21.21-2 of this code and is subject to an
 5-6     administrative penalty under Chapter 84 of this code.  The insurer
 5-7     shall pay the physician or provider making the claim the lesser of
 5-8     the full amount of billed charges submitted on the claim and
 5-9     interest on the billed charges at a rate of 15 percent annually or
5-10     two times the contracted rate and interest on that amount at a rate
5-11     of 15 percent annually.  Billed charges shall be established under
5-12     a fee schedule provided by the preferred provider to the insurer on
5-13     or before the 30th day after the date the physician or provider
5-14     enters into a preferred provider contract with the insurer.  The
5-15     preferred provider may modify the fee schedule if the provider
5-16     notifies the insurer of the modification on or before the 90th day
5-17     before the date the modification takes effect.
5-18           (h)  The investigation and determination of eligibility for
5-19     payment, including any coordination of other payments, does not
5-20     extend the period for determining whether a claim is eligible for
5-21     payment under Subsection (e) of this section [(d) If a prescription
5-22     benefit claim is electronically adjudicated and electronically
5-23     paid, and the preferred provider or its designated agent authorizes
5-24     treatment, the claim must be paid not later than the 21st day after
5-25     the treatment is authorized].
5-26           (i)  Except as provided by Subsection (j) of this section, if
5-27     [(e)  If] the insurer acknowledges coverage of an insured under the
 6-1     health insurance policy but intends to audit the preferred provider
 6-2     claim, the insurer shall pay the charges submitted at 85 percent of
 6-3     the contracted rate on the claim not later than the 45th day after
 6-4     the date that the insurer receives the claim from the preferred
 6-5     provider.  The insurer must complete [Following completion of] the
 6-6     audit, and any additional payment due a preferred provider or any
 6-7     refund due the insurer shall be made not later than the 90th [30th]
 6-8     day after the receipt of a claim or 45 days after receipt of a
 6-9     completed attachment from the physician or provider, whichever is
6-10     later [of the date that:]
6-11                 [(1)  the preferred provider receives notice of the
6-12     audit results; or]
6-13                 [(2)  any appeal rights of the insured are exhausted].
6-14           (j)  If an insurer needs additional information from a
6-15     treating preferred provider to determine eligibility for payment,
6-16     the insurer, not later than the 30th calendar day after the date
6-17     the insurer receives a clean claim, shall request in writing that
6-18     the preferred provider provide any attachment to the claim the
6-19     insurer desires in good faith for clarification of the claim.  The
6-20     request must describe with specificity the clinical information
6-21     requested and relate only to information the insurer can
6-22     demonstrate is specific to the claim or the claim's related episode
6-23     of care. An insurer that requests an attachment under this
6-24     subsection shall determine whether the claim is eligible for
6-25     payment on or before the later of the 15th day after the date the
6-26     insurer receives the completed attachment or the latest date for
6-27     determining whether the claim is eligible for payment under
 7-1     Subsection (e) of this section.  An insurer may not make more than
 7-2     one request under this subsection in connection with a claim.
 7-3     Subsections (c) and (d) of this section apply to a request for and
 7-4     submission of an attachment under this subsection.
 7-5           (k)  If an insurer requests an attachment or other
 7-6     information from a person other than the physician or provider who
 7-7     submitted the claim, the insurer shall provide a copy of the
 7-8     request to the physician or provider who submitted the claim. The
 7-9     insurer may not withhold payment pending receipt of an attachment
7-10     or information requested under this subsection.  If on receiving an
7-11     attachment or information requested under this subsection the
7-12     insurer determines an error in payment of the claim, the insurer
7-13     may recover under Section 3C of this article.
7-14           (l)  The commissioner shall adopt rules under which an
7-15     insurer can easily identify attachments or information submitted by
7-16     a physician or provider under Subsection (j) or (k) of this
7-17     section.
7-18           (m)  The insurer's claims payment processes shall:
7-19                 (1)  use nationally recognized, generally accepted
7-20     Correct Procedural Terminology codes, including all relevant
7-21     modifiers; and
7-22                 (2)  be consistent with nationally recognized,
7-23     generally accepted, clinically appropriate bundling logic and edits
7-24     [(f)  An insurer that violates Subsection (c) or (e) of this
7-25     section is liable to a preferred provider for the full amount of
7-26     billed charges submitted on the claim or the amount payable under
7-27     the contracted penalty rate, less any amount previously paid or any
 8-1     charge for a service that is not covered by the health insurance
 8-2     policy].
 8-3           (n) [(g)]  A preferred provider may recover reasonable
 8-4     attorney's fees and court costs in an action to recover payment
 8-5     under this section.
 8-6           (o) [(h)]  In addition to any other penalty or remedy
 8-7     authorized by this code or another insurance law of this state, an
 8-8     insurer that violates Subsection (e) [(c)] or (i) [(e)] of this
 8-9     section is subject to an administrative penalty under Article 1.10E
8-10     of this code.  The administrative penalty imposed under that
8-11     article may not exceed $1,000 for each day the claim remains unpaid
8-12     in violation of Subsection (e) [(c)] or (i) [(e)] of this section.
8-13           (p) [(i)]  The insurer shall provide a preferred provider
8-14     with copies of all applicable utilization review policies and claim
8-15     processing policies or procedures[, including required data
8-16     elements and claim formats].
8-17           (q) [(j)  An insurer may, by contract with a preferred
8-18     provider, add or change the data elements that must be submitted
8-19     with the preferred provider claim.]
8-20           [(k)  Not later than the 60th day before the date of an
8-21     addition or change in the data elements that must be submitted with
8-22     a claim or any other change in an insurer's claim processing and
8-23     payment procedures, the insurer shall provide written notice of the
8-24     addition or change to each preferred provider.]
8-25           [(l)  This section does not apply to a claim made by a
8-26     preferred provider who is a member of the legislature.]
8-27           [(m)]  This section applies to a person with whom an insurer
 9-1     contracts to process claims or to obtain the services of preferred
 9-2     providers to provide medical care or health care to insureds under
 9-3     a health insurance policy.
 9-4           (r) [(n)]  The commissioner of insurance may adopt rules as
 9-5     necessary to implement this section.
 9-6           SECTION 3.  Article 3.70-3C, Insurance Code, as added by
 9-7     Chapter 1024, Acts of the 75th Legislature, Regular Session, 1997,
 9-8     is amended by adding Sections 3B-3I, 10, 11, and 12 to read as
 9-9     follows:
9-10           Sec. 3B.  ELEMENTS OF CLEAN CLAIM. (a)  A claim by a
9-11     physician or provider, other than an institutional provider, is a
9-12     "clean claim" if the claim is submitted using Health Care Financing
9-13     Administration Form 1500 or a successor to that form developed by
9-14     the National Uniform Billing Committee or its successor and adopted
9-15     by the commissioner by rule for the purposes of this subsection
9-16     that is submitted to an insurer for payment and that contains the
9-17     information required by the commissioner by rule for the purposes
9-18     of this subsection entered into the appropriate fields on the form.
9-19           (b)  A claim by an institutional provider is a "clean claim"
9-20     if the claim is submitted using Health Care Financing
9-21     Administration Form UB-92 or a successor to that form developed by
9-22     the National Uniform Billing Committee or its successor and adopted
9-23     by the commissioner by rule for the purposes of this subsection
9-24     that is submitted to an insurer for payment and that contains the
9-25     information required by the commissioner by rule for the purposes
9-26     of this subsection entered into the appropriate fields on the form.
9-27           (c)  An insurer may require any data element that is required
 10-1    in an electronic transaction set needed to comply with federal law.
 10-2    An insurer may not require a physician or provider to provide
 10-3    information other than information for a data field included on the
 10-4    form used for a clean claim under Subsection (a) or (b) of this
 10-5    section, as applicable.
 10-6          (d)  A claim submitted by a physician or provider that
 10-7    includes additional fields, data elements, attachments, or other
 10-8    information not required under this section is considered to be a
 10-9    clean claim for the purposes of this article.
10-10          Sec. 3C.  OVERPAYMENT. An insurer may recover an overpayment
10-11    to a physician or provider if:
10-12                (1)  not later than the 180th day after the date the
10-13    physician or provider receives the payment, the insurer provides
10-14    written notice of the overpayment to the physician or provider that
10-15    includes the basis and specific reasons for the request for
10-16    recovery of funds; and
10-17                (2)  the physician or provider does not make
10-18    arrangements for repayment of the requested funds on or before the
10-19    45th day after the date the physician or provider receives the
10-20    notice.
10-21          Sec. 3D.  VERIFICATION OF ELIGIBILITY FOR PAYMENT. (a)  On
10-22    the request of a physician or provider for verification of the
10-23    eligibility for payment of a particular medical care or health care
10-24    service the physician or provider proposes to provide to a
10-25    particular patient, the insurer shall inform the physician or
10-26    provider whether the service, if provided to that patient, is
10-27    eligible for payment from the insurer to the physician or provider.
 11-1          (b)  An insurer shall provide verification under this section
 11-2    between 6 a.m. and 6 p.m. central standard time each day.
 11-3          (c)  Verification under this section shall be made in good
 11-4    faith and without delay.
 11-5          (d)  In this section, "verification" includes any required
 11-6    preauthorization process.
 11-7          (e)  An insurer may establish a time certain for the validity
 11-8    of verification.
 11-9          (f)  If an insurer has verified medical care or health care
11-10    services, the insurer may not deny or reduce payment to a physician
11-11    or health care provider for those services unless:
11-12                (1)  the physician or provider has materially
11-13    misrepresented the proposed medical or health care services or has
11-14    substantially failed to perform the proposed medical or health care
11-15    services; or
11-16                (2)  the insurer certifies in writing:
11-17                      (A)  that the patient was not a covered enrollee
11-18    of the health plan;
11-19                      (B)  the insurer was notified on or before the
11-20    30th day after the date the patient's enrollment ended; and
11-21                      (C)  the physician or provider was notified that
11-22    the patient's enrollment ended on or before the 30th day after the
11-23    date of verification under this section.
11-24          Sec. 3E.  COORDINATION OF PAYMENT. (a)  An insurer may
11-25    require a physician or provider to retain in the physician's or
11-26    provider's records updated information concerning other health
11-27    benefit plan coverage and to provide the information to the
 12-1    insurer on the applicable form described by Section 3B of this
 12-2    article.  Except as provided in this subsection, an insurer may not
 12-3    require a physician or provider to investigate coordination of
 12-4    other health benefit plan coverage.
 12-5          (b)  Coordination of payment under this section does not
 12-6    extend the period for determining whether a service is eligible for
 12-7    payment under Section 3A(e) of this article.
 12-8          (c)  A physician or provider who submits a claim for
 12-9    particular medical care or health care services to more than one
12-10    health maintenance organization or insurer shall  provide written
12-11    notice on the claim submitted to each health maintenance
12-12    organization or insurer of the identity of each other health
12-13    maintenance organization or insurer with which the same claim is
12-14    being filed.
12-15          (d)  On receipt of notice under Subsection (c) of this
12-16    section, an insurer shall coordinate and determine the appropriate
12-17    payment for each health maintenance organization or insurer to make
12-18    to the physician or provider.
12-19          (e)  If an insurer is a secondary payor and pays more than
12-20    the amount for which the insurer is legally obligated, the insurer
12-21    may recover the amount of the overpayment from the health
12-22    maintenance organization or insurer that is primarily responsible
12-23    for that amount.
12-24          (f)  If the portion of the claim overpaid by the secondary
12-25    insurer was also paid by the primary health maintenance
12-26    organization or insurer, the secondary insurer may recover the
12-27    amount of overpayment under Section 3C of this article from the
 13-1    physician or provider who received the payment.
 13-2          (g)  An insurer may share information with another health
 13-3    maintenance organization or insurer to the extent necessary to
 13-4    coordinate appropriate payment obligations on a specific claim.
 13-5          (h)  The provisions of this section may not be waived,
 13-6    voided, or nullified by contract.
 13-7          Sec. 3F.  PREAUTHORIZATION OF MEDICAL AND HEALTH CARE
 13-8    SERVICES. (a)  An insurer that uses a preauthorization process for
 13-9    medical care and health care services shall provide to each
13-10    participating physician or health care provider, not later than the
13-11    10th working day after the date a request is made, a list of
13-12    medical care and health care services that require preauthorization
13-13    and information concerning the preauthorization process.
13-14          (b)  If proposed medical care or health care services require
13-15    preauthorization as a condition of the insurer's payment to a
13-16    physician or health care provider under a health insurance policy,
13-17    the insurer shall determine whether the medical care or health care
13-18    services proposed to be provided to the insured are medically
13-19    necessary and appropriate.
13-20          (c)  On receipt of a request from a physician or health care
13-21    provider for preauthorization, the insurer shall review and issue a
13-22    determination indicating whether the proposed services are
13-23    preauthorized.  The determination must be mailed or otherwise
13-24    transmitted not later than the third calendar day after the date
13-25    the request is received by the insurer.
13-26          (d)  If the proposed medical care or health care services
13-27    involve inpatient care, the determination issued by the insurer
 14-1    must be provided within one calendar day of the request by
 14-2    telephone or electronic transmission to the physician or health
 14-3    care provider of record and followed by written notice to the
 14-4    physician or provider on or before the third day after the date of
 14-5    the request and must specify an approved length of stay for
 14-6    admission into a health care facility based on the recommendation
 14-7    of the patient's physician or health care provider and the
 14-8    insurer's written medically acceptable screening criteria and
 14-9    review procedures. The criteria and procedures must be established,
14-10    periodically evaluated, and updated.
14-11          (e)  If an insurer has preauthorized medical care or health
14-12    care services, the insurer may not deny or reduce payment to the
14-13    physician or health care provider for those services unless:
14-14                (1)  the physician or provider has materially
14-15    misrepresented the proposed medical or health care services or has
14-16    substantially failed to perform the proposed medical or health care
14-17    services; or
14-18                (2)  the insurer certifies in writing:
14-19                      (A)  that the patient was not a covered enrollee
14-20    of the health plan;
14-21                      (B)  the insurer was notified on or before the
14-22    30th day after the date the patient's enrollment ended; and
14-23                      (C)  the physician or provider was notified that
14-24    the patient's enrollment ended on or before the 30th day after the
14-25    date of verification under this section.
14-26          (f)  This section applies to an agent or other person with
14-27    whom an insurer contracts to perform, or to whom the insurer
 15-1    delegates the performance of, preauthorization of proposed medical
 15-2    or health care services.
 15-3          Sec. 3G.  AVAILABILITY OF CODING GUIDELINES. (a)  A preferred
 15-4    provider contract between an insurer and a physician or provider
 15-5    must provide that:
 15-6                (1)  the physician or provider may request a
 15-7    description of the coding guidelines, including any underlying
 15-8    bundling, recoding, or other payment process and fee schedules
 15-9    applicable to specific procedures that the physician or provider
15-10    will receive under the contract;
15-11                (2)  the insurer or the insurer's agent will provide
15-12    the guidelines not later than the 30th day after the date the
15-13    insurer receives the request;
15-14                (3)  the insurer will provide notice of material
15-15    changes to the coding guidelines and fee schedules not later than
15-16    the 90th day before the date the changes take effect and will not
15-17    make retroactive revisions to the coding guidelines and fee
15-18    schedules; and
15-19                (4)  the contract may be terminated by the physician or
15-20    provider on or before the 30th day after the date the physician or
15-21    provider receives information requested under this subsection
15-22    without penalty or discrimination in participation in other health
15-23    care products or plans.
15-24          (b)  A physician or provider who receives information under
15-25    Subsection (a) of this section may use or disclose the information
15-26    only for the purpose of practice management, billing activities, or
15-27    other business operations.  The attorney general may impose and
 16-1    collect a penalty of $1,000 for each use or disclosure of the
 16-2    information that violates this subsection.
 16-3          (c)  Nothing in this section shall be interpreted to require
 16-4    an insurer to violate copyright or other law by disclosing
 16-5    proprietary software that the insurer has licensed.  In addition to
 16-6    the above, the insurer shall, on request of a physician or
 16-7    provider, provide the name, edition, and model version of the
 16-8    software that the insurer uses to determine bundling and unbundling
 16-9    of claims.
16-10          Sec. 3H.  DISPUTE RESOLUTION. (a)  An insurer may not require
16-11    by contract or otherwise the use of a dispute resolution procedure
16-12    or binding arbitration with a physician or health care provider.
16-13    This subsection does not prohibit an insurer from offering a
16-14    dispute resolution procedure or binding arbitration to resolve a
16-15    dispute if the insurer and the physician or provider consent to the
16-16    process after the dispute arises.  This subsection may not be
16-17    construed to conflict with any applicable appeal mechanisms
16-18    required by law.
16-19          (b)  The provisions of this section may not be waived or
16-20    nullified by contract.
16-21          Sec. 3I.  AUTHORITY OF ATTORNEY GENERAL. In addition to any
16-22    other remedy available for a violation of this article, the
16-23    attorney general may take action and seek remedies available under
16-24    Section 15, Article 21.21 of this code, and Sections 17.58, 17.60,
16-25    17.61, and 17.62, Business & Commerce Code, for a violation of
16-26    Section 3A or 7 of this article.
16-27          Sec. 10.  SERVICES PROVIDED BY CERTAIN PHYSICIANS AND HEALTH
 17-1    CARE PROVIDERS. The provisions of this article relating to prompt
 17-2    payment by an insurer of a physician or health care provider and to
 17-3    verification of medical care or health care services apply to a
 17-4    physician  or health care provider who:
 17-5                (1)  is not a preferred provider under a preferred
 17-6    provider benefit plan; and
 17-7                (2)  provides to an insured:
 17-8                      (A)  care related to an emergency or its
 17-9    attendant episode of care as required by state or federal law; or
17-10                      (B)  specialty or other medical care or health
17-11    care services at the request of the insurer or a preferred provider
17-12    because the services are not reasonably available from a preferred
17-13    provider.
17-14          Sec. 11.  CONFLICT WITH OTHER LAW. To the extent of any
17-15    conflict between this article and Article 21.52C of this code, this
17-16    article controls.
17-17          Sec. 12.  APPLICATION OF CERTAIN PROVISIONS UNDER MEDICAID. A
17-18    provision of this article may not be interpreted as requiring an
17-19    insurer, physician, or health care provider, in providing benefits
17-20    or services under the state Medicaid program, to:
17-21                (1)  use billing forms or codes that are inconsistent
17-22    with those required under the state Medicaid program; or
17-23                (2)  make determinations relating to medical necessity
17-24    or appropriateness or eligibility for coverage in a manner
17-25    different than that required under the state Medicaid program.
17-26          SECTION 4. Section 2, Texas Health Maintenance Organization
17-27    Act (Article 20A.02, Vernon's Texas Insurance Code), is amended by
 18-1    adding Subdivisions (ff) and (gg) to read as follows:
 18-2                (ff)  "Preauthorization"  means a determination by the
 18-3    health maintenance organization that the medical care or health
 18-4    care services proposed to be provided to a patient are medically
 18-5    necessary and appropriate.
 18-6                (gg)  "Verification" means a reliable representation by
 18-7    a health maintenance organization to a physician or provider that
 18-8    the health maintenance organization will pay the physician or
 18-9    provider for proposed medical care or health care services if the
18-10    physician or provider renders those services to the patient for
18-11    whom the services are proposed.  The term includes
18-12    precertification, certification, recertification, or any other term
18-13    that would be a reliable representation by a health maintenance
18-14    organization to a physician or provider.
18-15          SECTION 5.  Section 18B, Texas Health Maintenance
18-16    Organization Act (Section 20A.18B, Vernon's Texas Insurance Code),
18-17    is amended to read as follows:
18-18          Sec. 18B.  PROMPT PAYMENT OF PHYSICIAN AND PROVIDERS. (a)  In
18-19    this section, "clean claim" means a [completed] claim that complies
18-20    with Section 18D of this Act[, as determined under Texas Department
18-21    of Insurance rules, submitted by a physician or provider for
18-22    medical care or health care services under a health care plan].
18-23          (b)  A physician or provider must submit a claim under this
18-24    section to a health maintenance organization not later than the
18-25    95th day after the date the physician or provider provides the
18-26    medical care or health care services for which the claim is made.
18-27    A health maintenance organization shall accept as proof of timely
 19-1    filing a claim filed in compliance with Subsection (c) of this
 19-2    section or information from another health maintenance organization
 19-3    showing that the physician or provider submitted the claim to the
 19-4    health maintenance organization in compliance with Subsection (c)
 19-5    of this section.  If a physician or provider fails to submit a
 19-6    claim in compliance with this subsection, the physician or provider
 19-7    forfeits the right to payment.  The period for submitting a claim
 19-8    under this subsection may be extended by contract.  A physician or
 19-9    provider may not submit a duplicate claim for payment before the
19-10    46th day after the date the original claim was submitted.  The
19-11    commissioner shall adopt rules under which a health maintenance
19-12    organization may determine whether a claim is a duplicate claim [A
19-13    physician or provider for medical care or health care services
19-14    under a health care plan may obtain acknowledgment of receipt of a
19-15    claim for medical care or health care services under a health care
19-16    plan by submitting the claim by United States mail, return receipt
19-17    requested.  A health maintenance organization or the contracted
19-18    clearinghouse of the health maintenance organization that receives
19-19    a claim electronically shall acknowledge receipt of the claim by an
19-20    electronic transmission to the physician or provider and is not
19-21    required to acknowledge receipt of the claim by the health
19-22    maintenance organization in writing].
19-23          (c)  A physician or provider shall, as appropriate:
19-24                (1)  mail a claim by United States mail, first class,
19-25    or by overnight delivery service, and maintain a log of mailed
19-26    claims and include a copy of the log with the claim;
19-27                (2)  submit the claim electronically and maintain a log
 20-1    of electronically submitted claims;
 20-2                (3)  fax the claim and maintain a log of all faxed
 20-3    claims; or
 20-4                (4)  hand deliver the claim and maintain a log of all
 20-5    hand-delivered claims.
 20-6          (d)  If a claim for medical care or health care services
 20-7    under a health care plan is mailed, the claim is presumed to have
 20-8    been received by the health maintenance organization on the third
 20-9    day after the date the claim is mailed or, if the claim is mailed
20-10    using overnight service or return receipt requested, on the date
20-11    the delivery receipt is signed.  If the claim is submitted
20-12    electronically, the claim is presumed to have been received on the
20-13    date of the electronic verification of receipt by the health
20-14    maintenance organization or the health maintenance organization's
20-15    clearinghouse.  If the health maintenance organization or the
20-16    health maintenance organization's clearinghouse does not provide a
20-17    confirmation within 24 hours of submission by the physician or
20-18    provider, the physician's or provider's clearinghouse shall provide
20-19    the confirmation.  The physician's or provider's clearinghouse must
20-20    be able to verify that the filing contained the correct address of
20-21    the entity to receive the filing.  If the claim is faxed, the claim
20-22    is presumed to have been received on the date of the transmission
20-23    acknowledgment.  If the claim is hand delivered, the claim is
20-24    presumed to have been received on the date the delivery receipt is
20-25    signed.  The commissioner shall promulgate a form to be submitted
20-26    by the physician or provider which easily identifies all claims
20-27    included in each filing which can be utilized by the physician or
 21-1    provider as their log.
 21-2          (e)  Not later than the 45th day after the date that the
 21-3    health maintenance organization receives a clean claim from a
 21-4    physician or provider, the health maintenance organization shall
 21-5    make a determination of whether the claim is eligible for payment
 21-6    and:
 21-7                (1)  if the health maintenance organization determines
 21-8    the entire claim is eligible for payment, pay the total amount of
 21-9    the claim in accordance with the contract between the physician or
21-10    provider and the health maintenance organization;
21-11                (2)  if the health maintenance organization disputes a
21-12    portion of the claim, pay the portion of the claim that is not in
21-13    dispute and notify the physician or provider in writing why the
21-14    remaining portion of the claim will not be paid; or
21-15                (3)  if the health maintenance organization determines
21-16    that the claim is not eligible for payment, notify the physician or
21-17    provider in writing why the claim will not be paid.
21-18          (f)  Not later than the 21st day after the date a health
21-19    maintenance organization or the health maintenance organization's
21-20    designated agent affirmatively adjudicates a pharmacy benefit claim
21-21    that is electronically submitted, the health maintenance
21-22    organization shall:
21-23                (1)  pay the total amount of the claim; or
21-24                (2)  notify the benefit provider of the reasons for
21-25    denying payment of the claim.
21-26          (g)  A health maintenance organization that determines under
21-27    Subsection (e) of this section that a claim is eligible for payment
 22-1    and does not pay the claim on or before the 45th day after the date
 22-2    the health maintenance organization receives a clean claim commits
 22-3    an unfair claim settlement practice in violation of Article
 22-4    21.21-2, Insurance Code, and is subject to an administrative
 22-5    penalty under Chapter 84, Insurance Code.  The health maintenance
 22-6    organization shall pay the physician or provider making the claim
 22-7    the full amount of billed charges submitted on the claim and
 22-8    interest on the billed charges at a rate of 15 percent annually,
 22-9    except that the health maintenance organization is not required to
22-10    pay a physician or provider with whom the health maintenance
22-11    organization has a contract an amount of billed charges that
22-12    exceeds the amount billable under a fee schedule provided by the
22-13    physician or provider to the health maintenance organization on or
22-14    before the 30th day after the date the physician or provider enters
22-15    into the contract with the health maintenance organization.  The
22-16    physician or provider may modify the fee schedule if the physician
22-17    or provider notifies the health maintenance organization of the
22-18    modification on or before the 90th day before the date the
22-19    modification takes effect.
22-20          (h)  The investigation and determination of eligibility for
22-21    payment, including any coordination of other payments, does not
22-22    extend the period for determining whether a claim is eligible for
22-23    payment under Subsection (e) of this section [(d)  If a
22-24    prescription benefit claim is electronically adjudicated and
22-25    electronically paid, and the health maintenance organization or its
22-26    designated agent authorizes treatment, the claim must be paid not
22-27    later than the 21st day after the treatment is authorized].
 23-1          (i)  Except as provided by Subsection (j) of this section, if
 23-2    [(e)  If] the health maintenance organization acknowledges coverage
 23-3    of an enrollee under the health care plan but intends to audit the
 23-4    physician or provider claim, the health maintenance organization
 23-5    shall pay the charges submitted at 85 percent of the contracted
 23-6    rate on the claim not later than the 45th day after the date that
 23-7    the health maintenance organization receives the claim from the
 23-8    physician or provider.  The health maintenance organization shall
 23-9    complete [Following completion of] the audit, and any additional
23-10    payment due a physician or provider or any refund due the health
23-11    maintenance organization shall be made not later than the 90th
23-12    [30th] day after the receipt of a claim or 45 days after receipt of
23-13    a completed attachment from the physician or provider, whichever is
23-14    later [later of the date that:]
23-15                [(1)  the physician or provider receives notice of the
23-16    audit results; or]
23-17                [(2)  any appeal rights of the enrollee are exhausted].
23-18          (j)  If a health maintenance organization needs additional
23-19    information from a treating physician or provider to determine
23-20    eligibility for payment, the health maintenance organization, not
23-21    later than the 30th calendar day after the date the health
23-22    maintenance organization receives a clean claim, shall request in
23-23    writing that the physician or provider provide any attachment to
23-24    the claim the health maintenance organization desires in good faith
23-25    for clarification of the claim.  The request must describe with
23-26    specificity the clinical information requested and relate only to
23-27    information the health maintenance organization can demonstrate is
 24-1    specific to the claim or the claim's related episode of care.  A
 24-2    health maintenance organization that requests an attachment under
 24-3    this subsection shall determine whether the claim is eligible for
 24-4    payment on or before the later of the 15th day after the date the
 24-5    health maintenance organization receives the completed attachment
 24-6    or the latest date for determining whether the claim is eligible
 24-7    for payment under Subsection (e) of this section.  A health
 24-8    maintenance organization may not make more than one request under
 24-9    this subsection in connection with a claim. Subsections (c) and (d)
24-10    of this section apply to a request for and submission of an
24-11    attachment under this subsection.
24-12          (k)  If a health maintenance organization requests an
24-13    attachment or other information from a person other than the
24-14    physician or provider who submitted the claim, the health
24-15    maintenance organization shall provide a copy of the request to the
24-16    physician or provider who submitted the claim.  The health
24-17    maintenance organization may not withhold payment pending receipt
24-18    of an attachment or information requested under this subsection.
24-19    If on receiving an attachment or information requested under this
24-20    subsection the health maintenance organization determines an error
24-21    in payment of the claim, the health maintenance organization may
24-22    recover under Section 18E of this Act.
24-23          (l)  The commissioner shall adopt rules under which a health
24-24    maintenance organization can easily identify attachments or
24-25    information submitted by a physician or provider.
24-26          (m)  A health maintenance organization's claims payment
24-27    processes must:
 25-1                (1)  use nationally recognized, generally accepted
 25-2    Correct Procedural Terminology codes, including all relevant
 25-3    modifiers; and
 25-4                (2)  be consistent with nationally recognized,
 25-5    generally accepted, clinically appropriate bundling logic and edits
 25-6    [(f)  A health maintenance organization that violates Subsection
 25-7    (c) or (e) of this section is liable to a physician or provider for
 25-8    the full amount of billed charges submitted on the claim or the
 25-9    amount payable under the contracted penalty rate, less any amount
25-10    previously paid or any charge for a service that is not covered by
25-11    the health care plan].
25-12          (n) [(g)]  A physician or provider may recover reasonable
25-13    attorney's fees and court costs in an action to recover payment
25-14    under this section.
25-15          (o) [(h)]  In addition to any other penalty or remedy
25-16    authorized by the Insurance Code or another insurance law of this
25-17    state, a health maintenance organization that violates Subsection
25-18    (e) [(c)] or (i) [(e)] of this section is subject to an
25-19    administrative penalty under Article 1.10E, Insurance Code.  The
25-20    administrative penalty imposed under that article may not exceed
25-21    $1,000 for each day the claim remains unpaid in violation of
25-22    Subsection (e) [(c)] or (i) [(e)] of this section.
25-23          (p) [(i)]  The health maintenance organization shall provide
25-24    a participating physician or provider with copies of all applicable
25-25    utilization review policies and claim processing policies or
25-26    procedures[, including required data elements and claim formats].
25-27          (q) [(j)  A health maintenance organization may, by contract
 26-1    with a physician or provider, add or change the data elements that
 26-2    must be submitted with the physician or provider claim.]
 26-3          [(k)  Not later than the 60th day before the date of an
 26-4    addition or change in the data elements that must be submitted with
 26-5    a claim or any other change in a health maintenance organization's
 26-6    claim processing and payment procedures, the health maintenance
 26-7    organization shall provide written notice of the addition or change
 26-8    to each participating physician or provider.]
 26-9          [(l)  This section does not apply to a claim made by a
26-10    physician or provider who is a member of the legislature.]
26-11          [(m)]  This section does not apply to a capitation payment
26-12    required to be made to a physician or provider under an agreement
26-13    to provide medical care or health care services under a health care
26-14    plan.
26-15          (r) [(n)]  This section applies to a person with whom a
26-16    health maintenance organization contracts to process claims or to
26-17    obtain the services of physicians and providers to provide health
26-18    care services to health care plan enrollees.
26-19          (s) [(o)]  The commissioner may adopt rules as necessary to
26-20    implement this section.
26-21          SECTION 6. The Texas Health Maintenance Organization Act
26-22    (Chapter 20A, Vernon's Texas Insurance Code) is amended by adding
26-23    Sections 18D-18L, 40, and 41 to read as follows:
26-24          Sec. 18D.  ELEMENTS OF CLEAN CLAIM.  (a)  A claim by a
26-25    physician or provider, other than an institutional provider, is a
26-26    "clean claim" if the claim is submitted using Health Care Financing
26-27    Administration Form 1500 or a successor to that form developed by
 27-1    the National Uniform Billing Committee or its successor and adopted
 27-2    by the commissioner by rule for the purposes of this subsection
 27-3    that is submitted to a health maintenance organization for payment
 27-4    and that contains the information required by the commissioner by
 27-5    rule for the purposes of this subsection entered into the
 27-6    appropriate fields on the form.
 27-7          (b)  A claim by an institutional provider is a "clean claim"
 27-8    if the claim is submitted using Health Care Financing
 27-9    Administration Form UB-92 or a successor to that form developed by
27-10    the National Uniform Billing Committee or its successor and adopted
27-11    by the commissioner by rule for the purposes of this subsection
27-12    that is submitted to a health maintenance organization for payment
27-13    and that contains the information required by the commissioner by
27-14    rule for the purposes of this subsection entered into the
27-15    appropriate fields on the form.
27-16          (c)  A health maintenance organization may require any data
27-17    element that is required in an electronic transaction set needed to
27-18    comply with federal law.  A health maintenance organization may not
27-19    require a physician or provider to provide information other than
27-20    information for a data field included on the form used for a clean
27-21    claim under Subsection (a)  or (b) of this section, as applicable.
27-22          (d)  A claim submitted by a physician or provider that
27-23    includes additional fields, data elements, attachments, or other
27-24    information not required under this section is considered to be a
27-25    clean claim for the purposes of this section.
27-26          Sec. 18E.  OVERPAYMENT.  A health maintenance organization
27-27    may recover an overpayment to a physician or provider if:
 28-1                (1)  not later than the 180th day after the date the
 28-2    physician or provider receives the payment, the health maintenance
 28-3    organization provides written notice of the overpayment to the
 28-4    physician or provider that includes the basis and specific reasons
 28-5    for the request for recovery of funds; and
 28-6                (2)  the physician or provider does not make
 28-7    arrangements for repayment of the requested funds on or before the
 28-8    45th day after the date the physician or provider receives the
 28-9    notice.
28-10          Sec. 18F.  VERIFICATION OF ELIGIBILITY FOR PAYMENT.  (a)  On
28-11    the request of a physician or provider for verification of the
28-12    payment eligibility of a particular medical care or health care
28-13    service the physician or provider proposes to provide to a
28-14    particular patient, the health maintenance organization shall
28-15    inform the physician or provider whether the service, if provided
28-16    to that patient, is eligible for payment from the health
28-17    maintenance organization to the physician or provider.
28-18          (b)  A health maintenance organization shall provide
28-19    verification under this section between 6 a.m. and 6 p.m. central
28-20    standard time each day.
28-21          (c)  Verification under this section shall be made in good
28-22    faith and without delay.
28-23          (d)  In this section, "verification" includes any required
28-24    preauthorization process.
28-25          (e)  A health maintenance organization may establish a time
28-26    certain for the validity of verification.
28-27          (f)  If a health maintenance organization has verified
 29-1    medical care or health care services, the health maintenance
 29-2    organization may not deny or reduce payment to a physician or
 29-3    health care provider for those services unless:
 29-4                (1)  the physician or provider has materially
 29-5    misrepresented the proposed medical or health care services or has
 29-6    substantially failed to perform the proposed medical or health care
 29-7    services; or
 29-8                (2)  the health maintenance organization certifies in
 29-9    writing:
29-10                      (A)  that the patient was not a covered enrollee
29-11    of the health plan;
29-12                      (B)  the health maintenance organization was
29-13    notified on or before the 30th day after the date the patient's
29-14    enrollment ended; and
29-15                      (C)  the physician or provider was notified that
29-16    the patient's enrollment ended on or before the 30th day after the
29-17    date of verification under this section.
29-18          Sec. 18G.  COORDINATION OF PAYMENT BENEFITS. (a)  A health
29-19    maintenance organization may require a physician or provider to
29-20    retain in the physician's or provider's records updated information
29-21    concerning other health benefit plan coverage and to provide the
29-22    information to the  health maintenance organization on the
29-23    applicable form described by Section 18D of this Act. Except as
29-24    provided by this subsection, a health maintenance organization may
29-25    not require a physician or provider to investigate coordination of
29-26    other health benefit plan coverage.
29-27          (b)  Coordination of other payment under this section does
 30-1    not extend the period for determining whether a service is eligible
 30-2    for payment under Section 18B(e) of this Act.
 30-3          (c)  A physician or provider who submits a claim for
 30-4    particular medical care or health care services to more than one
 30-5    health maintenance organization or insurer shall  provide written
 30-6    notice on the claim submitted to each health maintenance
 30-7    organization or insurer of the identity of each other health
 30-8    maintenance organization or insurer with which the same claim is
 30-9    being filed.
30-10          (d)  On receipt of notice under Subsection (c) of this
30-11    section, a health maintenance organization shall coordinate and
30-12    determine the appropriate payment for each health maintenance
30-13    organization or insurer to make to the physician or provider.
30-14          (e)  If a health maintenance organization is a secondary
30-15    payor and pays more than the amount for which the health
30-16    maintenance organization is legally obligated, the overpayment may
30-17    be recovered from the health maintenance organization or insurer
30-18    that is primarily responsible for that amount.
30-19          (f)  If the portion of the claim overpaid by the secondary
30-20    health maintenance organization was also paid by the primary health
30-21    maintenance organization or insurer, the secondary health
30-22    maintenance organization may recover the amount of the overpayment
30-23    under Section 18E of this Act from the physician or provider who
30-24    received the payment.
30-25          (g)  A health maintenance organization may share information
30-26    with another health maintenance organization or insurer to the
30-27    extent necessary to coordinate appropriate payment obligations on a
 31-1    specific claim.
 31-2          (h)  The provisions of this section may not be waived,
 31-3    voided, or nullified by contract.
 31-4          Sec. 18H.  PREAUTHORIZATION OF MEDICAL AND HEALTH CARE
 31-5    SERVICES. (a)  A health maintenance organization that uses a
 31-6    preauthorization process for medical care and health care services
 31-7    shall provide each participating physician or provider, not later
 31-8    than the 10th working day after the date a request is made, a list
 31-9    of the medical care and health care services that do not require
31-10    preauthorization and information concerning the preauthorization
31-11    process.
31-12          (b)  If proposed medical care or health care services require
31-13    preauthorization by a health maintenance organization as a
31-14    condition of the health maintenance organization's payment to a
31-15    physician or provider, the health maintenance organization shall
31-16    determine whether the medical care or health care services proposed
31-17    to be provided to the enrollee are medically necessary and
31-18    appropriate.
31-19          (c)  On receipt of a request from a physician or provider for
31-20    preauthorization, the health maintenance organization shall review
31-21    and issue a determination indicating whether the services are
31-22    preauthorized.  The determination must be mailed or otherwise
31-23    transmitted not later than the third calendar day after the date
31-24    the request is received by the insurer.
31-25          (d)  If the proposed medical care or health care services
31-26    involve inpatient care, the determination issued by the health
31-27    maintenance organization must be provided within one calendar day
 32-1    of the request by telephone or electronic transmission to the
 32-2    physician or provider of record and followed by written notice to
 32-3    the physician or provider on or before the third day after the date
 32-4    of the request and must specify an approved length of stay for
 32-5    admission into a health care facility based on the recommendation
 32-6    of the patient's physician or provider and the health maintenance
 32-7    organization's written medically acceptable screening criteria and
 32-8    review procedures. The criteria and procedures must be established,
 32-9    periodically evaluated, and updated.
32-10          (e)  If the health maintenance organization has preauthorized
32-11    medical care or health care services, the health maintenance
32-12    organization may not deny or reduce payment to the physician or
32-13    provider for those services unless:
32-14                (1)  the physician or provider has materially
32-15    misrepresented the proposed medical or health care services or has
32-16    substantially failed to perform the proposed medical or health care
32-17    services; or
32-18                (2)  the health maintenance organization certifies in
32-19    writing:
32-20                      (A)  that the patient was not a covered enrollee
32-21    of the health plan;
32-22                      (B)  the health maintenance organization was
32-23    notified on or before the 30th day after the date the patient's
32-24    enrollment ended; and
32-25                      (C)  the physician or provider was notified that
32-26    the patient's enrollment ended on or before the 30th day after the
32-27    date of verification under this section.
 33-1          (f)  This section applies to an agent or other person with
 33-2    whom a health maintenance organization contracts to perform, or to
 33-3    whom the health maintenance organization delegates the performance
 33-4    of, preauthorization of proposed medical care or health care
 33-5    services.
 33-6          Sec. 18I.  SERVICES PROVIDED BY CERTAIN PHYSICIANS AND
 33-7    PROVIDERS. The provisions of this Act relating to prompt payment by
 33-8    a health maintenance organization of a physician or provider and to
 33-9    preauthorization of medical care or health care services apply to a
33-10    physician or provider who:
33-11                (1)  is not included in the health maintenance
33-12    organization delivery network; and
33-13                (2)  provides to an enrollee:
33-14                      (A)  care related to an emergency or its
33-15    attendant episode of care as required by state or federal law; or
33-16                      (B)  specialty or other medical care or health
33-17    care services at the request of the health maintenance organization
33-18    or a physician or provider who is included in the health
33-19    maintenance organization delivery network because the services are
33-20    not reasonably available within the network.
33-21          Sec. 18J.  AVAILABILITY OF CODING GUIDELINES. (a)  A contract
33-22    between a health maintenance organization and a physician or
33-23    provider must provide that:
33-24                (1)  the physician or provider may request a
33-25    description of the coding guidelines, including any underlying
33-26    bundling, recoding, or other payment process and fee schedules
33-27    applicable to specific procedures that the physician or provider
 34-1    will receive under the contract;
 34-2                (2)  the health maintenance organization will provide
 34-3    the guidelines not later than the 30th day after the date the
 34-4    health maintenance organization receives the request;
 34-5                (3)  the health maintenance organization will provide
 34-6    notice of material changes to the coding guidelines and fee
 34-7    schedules not later than the 90th day before the date the changes
 34-8    take effect and will not make retroactive revisions to the coding
 34-9    guidelines and fee schedules; and
34-10                (4)  the contract may be terminated by the physician or
34-11    provider on or before the 30th day after the date the physician or
34-12    provider receives information requested under this subsection
34-13    without penalty or discrimination in participation in other health
34-14    care products or plans.
34-15          (b)  A physician or provider who receives information under
34-16    Subsection (a) of this section may use or disclose the information
34-17    only for the purpose of practice management, billing activities, or
34-18    other business operations.  The attorney general may impose and
34-19    collect a penalty of $1,000 for each use or disclosure of the
34-20    information that violates this subsection.
34-21          (c)  Nothing in this section shall be interpreted to require
34-22    a health maintenance organization to violate copyright or other law
34-23    by disclosing proprietary software that the health maintenance
34-24    organization has licensed.  In addition to the above, the health
34-25    maintenance organization shall, on request of the physician or
34-26    provider, provide the name, edition, and model version of the
34-27    software that the health maintenance organization uses to determine
 35-1    bundling and unbundling of claims.
 35-2          Sec. 18K.  DISPUTE RESOLUTION.  (a)  A health maintenance
 35-3    organization may not require by contract or otherwise the use of a
 35-4    dispute resolution procedure or binding arbitration with a
 35-5    physician or provider. This subsection does not prohibit a health
 35-6    maintenance organization from offering a dispute resolution
 35-7    procedure or binding arbitration to resolve a dispute if the health
 35-8    maintenance organization and the physician or provider consent to
 35-9    the process after the dispute arises.  This subsection may not be
35-10    construed to conflict with any applicable appeal mechanisms
35-11    required by law.
35-12          (b)  The provisions of this section may not be waived or
35-13    nullified by contract.
35-14          Sec. 18L.  AUTHORITY OF ATTORNEY GENERAL.  In addition to any
35-15    other remedy available for a violation of this Act, the attorney
35-16    general may take action and seek remedies available under Section
35-17    15, Article 21.21, Insurance Code, and Sections 17.58, 17.60,
35-18    17.61, and 17.62, Business & Commerce Code, for a violation of
35-19    Section 14 or 18B of this Act.
35-20          Sec. 40.  CONFLICT WITH OTHER LAW.  To the extent of any
35-21    conflict between this Act and Article 21.52C, Insurance Code, this
35-22    Act controls.
35-23          Sec. 41.  APPLICATION OF CERTAIN PROVISIONS UNDER MEDICAID.
35-24    A provision of this Act may not be interpreted as requiring a
35-25    health maintenance organization, physician, or provider, in
35-26    providing benefits or services under the state Medicaid program,
35-27    to:
 36-1                (1)  use billing forms or codes that are inconsistent
 36-2    with those required under the state Medicaid program;
 36-3                (2)  make determinations relating to medical necessity
 36-4    or appropriateness or eligibility for coverage in a manner
 36-5    different than that required under the state Medicaid program; or
 36-6                (3)  reimburse physicians or providers for services
 36-7    rendered to a person who was not eligible to receive benefits for
 36-8    such services under the state Medicaid program.
 36-9          SECTION 7. (a)  The changes in law made by this Act relating
36-10    to payment of a physician or health care provider for medical or
36-11    health care services apply only to payment for services provided on
36-12    or after the effective date of this Act.
36-13          (b)  The changes in law made by this Act relating to a
36-14    contract between a physician or health care provider and an insurer
36-15    or health maintenance organization apply only to a contract entered
36-16    into or renewed on or after the effective date of this Act.
36-17          SECTION 8. This Act takes effect September 1, 2001.