77R11497 DLF-F
By Capelo H.B. No. 1913
Substitute the following for H.B. No. 1913:
By Lewis of Tarrant C.S.H.B. No. 1913
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to termination of certain contracts by a preferred
1-3 provider organization or health maintenance organization.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 3, 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 amending Subsection (g) and adding
1-8 Subsections (o) and (p) to read as follows:
1-9 (g) Before terminating a contract with a preferred provider,
1-10 the insurer shall provide written reasons for the termination. On
1-11 request and, except as provided by this subsection, prior [Prior]
1-12 to termination of a physician or practitioner, but within a period
1-13 not to exceed 60 days, the insurer shall[, on request,] provide a
1-14 reasonable review mechanism that incorporates, in an advisory role
1-15 [only], a review panel selected in the manner described in
1-16 Subsection (b)(3) of this section. If a contributing cause of the
1-17 termination is based on utilization review, quality review, or
1-18 any action reported to the National Practitioner Data Bank, the
1-19 review mechanism must be a peer review process that meets the
1-20 requirements of 42 U.S.C. Section 11101 et seq., as amended, and
1-21 must be conducted before the preferred provider organization files
1-22 any complaint, as provided under state law or 42 U.S.C. Section
1-23 11101 et seq., as amended, with the Texas State Board of Medical
1-24 Examiners. In [, except in] cases in which there is imminent harm
2-1 to a patient's health or an action by a state medical or other
2-2 physician licensing board or other government agency that
2-3 effectively impairs a physician's or practitioner's ability to
2-4 practice medicine or in cases of fraud or malfeasance, the peer
2-5 review process must be initiated simultaneously with the
2-6 termination or suspension. Any recommendation of the panel shall
2-7 be provided to the affected physician or practitioner. An [In the
2-8 event of an] insurer determination contrary to any recommendation
2-9 of the panel must be for good cause shown, and a written
2-10 explanation of the insurer's determination shall also be provided
2-11 [on request] to the affected physician or practitioner. On
2-12 request, an expedited review process shall be made available to a
2-13 physician or practitioner who is being terminated. The expedited
2-14 review process shall comply with rules established by the
2-15 commissioner.
2-16 (o) A preferred provider who is injured by an insurer's
2-17 failure to follow the procedures required under Subsection (g) of
2-18 this section may bring an action against the insurer to recover:
2-19 (1) the damages incurred;
2-20 (2) court costs and attorney's fees reasonable in
2-21 relation to the amount of work expended;
2-22 (3) an order enjoining the act or failure to act; and
2-23 (4) other relief the court considers proper.
2-24 (p) A preferred provider may bring an action under
2-25 Subsection (o) of this section on the person's own behalf and on
2-26 behalf of others similarly situated.
2-27 SECTION 2. Section 18A, Texas Health Maintenance Organization
3-1 Act (Article 20A.18A, Vernon's Texas Insurance Code), as added by
3-2 Chapter 1026, Acts of the 75th Legislature, Regular Session, 1997,
3-3 is amended by amending Subsection (b) and adding Subsections (k)
3-4 and (l) to read as follows:
3-5 (b) Before terminating a contract with a physician or
3-6 provider, the health maintenance organization shall provide a
3-7 written explanation to the physician or provider of the reasons for
3-8 termination. On request and, except as provided by this
3-9 subsection, before the effective date of the termination, but
3-10 within a period not to exceed 60 days, a physician or provider
3-11 shall be entitled to a review of the health maintenance
3-12 organization's proposed termination by an advisory review panel.
3-13 If a contributing cause of the termination is based on utilization
3-14 review, quality review, or any action reported to the National
3-15 Practitioner Data Bank, the review mechanism must be a peer review
3-16 process that meets the requirements of 42 U.S.C. Section 11101 et
3-17 seq., as amended, and must be conducted before the health
3-18 maintenance organization files any complaint, as provided under
3-19 state law or 42 U.S.C. Section 11101 et seq., as amended, with the
3-20 Texas State Board of Medical Examiners. In [, except in] a case in
3-21 which there is imminent harm to patient health or an action by a
3-22 state medical or dental board, other medical or dental licensing
3-23 board, or other licensing board or other government agency, that
3-24 effectively impairs the physician's or provider's ability to
3-25 practice medicine, dentistry, or another profession, or in a case
3-26 of fraud or malfeasance, the peer review process must be initiated
3-27 simultaneously with the termination or suspension. The advisory
4-1 review panel shall be composed of physicians and providers,
4-2 including at least one representative in the physician's or
4-3 provider's specialty or a similar specialty, if available,
4-4 appointed to serve on the standing quality assurance committee or
4-5 utilization review committee of the health maintenance
4-6 organization. The decision of the advisory review panel must be
4-7 considered and [but] is [not] binding on the health maintenance
4-8 organization, except for good cause shown. The health maintenance
4-9 organization shall provide to the affected physician or provider,
4-10 on request, a copy of the recommendation of the advisory review
4-11 panel and the health maintenance organization's determination.
4-12 (k) A physician or provider who is injured by a health
4-13 maintenance organization's failure to follow the procedures
4-14 required under Subsection (b) of this section may bring an action
4-15 against the health maintenance organization to recover:
4-16 (1) the damages incurred;
4-17 (2) court costs and attorney's fees reasonable in
4-18 relation to the amount of work expended;
4-19 (3) an order enjoining the act or failure to act; and
4-20 (4) other relief the court considers proper.
4-21 (l) A physician or provider may bring an action under
4-22 Subsection (k) of this section on the person's own behalf and on
4-23 behalf of others similarly situated.
4-24 SECTION 3. This Act applies only to a contract between an
4-25 insurer and a preferred provider or a health maintenance
4-26 organization and a physician or provider that is entered into or
4-27 renewed on or after the effective date of this Act. A contract
5-1 that is entered into or renewed before the effective date of this
5-2 Act is governed by the law in effect immediately before the
5-3 effective date of this Act, and that law is continued in effect for
5-4 that purpose.
5-5 SECTION 4. This Act takes effect immediately if it receives
5-6 a vote of two-thirds of all the members elected to each house, as
5-7 provided by Section 39, Article III, Texas Constitution. If this
5-8 Act does not receive the vote necessary for immediate effect, this
5-9 Act takes effect September 1, 2001.