By Smithee H.B. No. 3014
77R7902 PB-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to prohibited practices regarding determinations of
1-3 eligibility for coverage and authorizations for certain services
1-4 provided by health maintenance organizations or preferred provider
1-5 plans.
1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-7 SECTION 1. The Texas Health Maintenance Organization Act
1-8 (Chapter 20A, Vernon's Texas Insurance Code) is amended by adding
1-9 Section 14A to read as follows:
1-10 Sec. 14A. PROHIBITED PRACTICES REGARDING DETERMINATIONS OF
1-11 ELIGIBILITY OR AUTHORIZATION. (a) In this section, "authorization"
1-12 includes certification, precertification, recertification, or any
1-13 other term indicating approval by a health maintenance organization
1-14 for a physician or provider to provide medical care or other health
1-15 care services to an enrollee.
1-16 (b) A health maintenance organization may not deny payment
1-17 to a physician or provider for medical care or other health care
1-18 services provided to an enrollee based on the enrollee's
1-19 ineligibility to receive the care or services, or the lack of
1-20 authorization for the physician or provider to provide the care or
1-21 services to the enrollee, if the health maintenance organization:
1-22 (1) failed to respond to the request for verification
1-23 of eligibility or authorization made by the physician, the
1-24 provider, or an employee of the physician or provider, within 24
2-1 hours after the initial request or, in the case of an
2-2 authorization, a shorter or longer period required or permitted by
2-3 this Act or the Insurance Code;
2-4 (2) verified the enrollee's eligibility in any manner
2-5 but later determined the eligibility to be invalid; or
2-6 (3) informed the physician, the provider, or an
2-7 employee of the physician or provider that the care or services
2-8 were authorized but later determined the authorization to be
2-9 invalid.
2-10 (c) Subsection (b) of this section applies to a health
2-11 maintenance organization that contracts with any person to make
2-12 eligibility or authorization decisions or to communicate
2-13 eligibility or authorization decisions to physicians or providers
2-14 if that person:
2-15 (1) failed to respond to the request for verification
2-16 of eligibility or authorization in a timely manner as required by
2-17 Subsection (b)(1) of this section; or
2-18 (2) verified eligibility in any manner or communicated
2-19 to the physician, provider, or employee that medical care or health
2-20 care services were authorized, but that eligibility or
2-21 authorization was later determined to be invalid by the health
2-22 maintenance organization.
2-23 SECTION 2. Article 3.70-3C, Insurance Code, as added by
2-24 Chapter 1024, Acts of the 75th Legislature, Regular Session, 1997,
2-25 is amended by adding Section 7B to read as follows:
2-26 Sec. 7B. PROHIBITED PRACTICES REGARDING DETERMINATIONS OF
2-27 ELIGIBILITY OR AUTHORIZATION. (a) In this section, "authorization"
3-1 includes certification, precertification, recertification, or any
3-2 other term indicating approval by an insurer for a physician or
3-3 provider to provide services covered by a health insurance policy
3-4 to an insured.
3-5 (b) An insurer may not deny payment to a physician or
3-6 provider for services covered by a health insurance policy and
3-7 provided to an insured based on the insured's ineligibility to
3-8 receive the services, or the lack of authorization for the
3-9 physician or provider to provide the services to the insured, if
3-10 the insurer:
3-11 (1) failed to respond to the request for verification
3-12 of eligibility or authorization made by the physician, the
3-13 provider, or an employee of the physician or provider within 24
3-14 hours after the initial request or, in the case of an
3-15 authorization, a shorter or longer period required or permitted by
3-16 this code;
3-17 (2) verified the insured's eligibility in any manner
3-18 but later determined the eligibility to be invalid; or
3-19 (3) informed the physician, the provider, or an
3-20 employee of the physician or provider that the services were
3-21 authorized but later determined the authorization to be invalid.
3-22 (c) Subsection (b) of this section applies to an insurer
3-23 that contracts with any person or entity to make eligibility or
3-24 authorization decisions or to communicate eligibility or
3-25 authorization decisions to physicians or providers if that person:
3-26 (1) failed to respond to the request for verification
3-27 of eligibility or authorization in a timely manner as required by
4-1 Subsection (b)(1) of this section; or
4-2 (2) verified eligibility in any manner or communicated
4-3 to the physician, provider, or employee that medical care or health
4-4 care services were authorized, but that eligibility or
4-5 authorization was later determined to be invalid by the insurer.
4-6 SECTION 3. This Act applies only to an insurance policy,
4-7 contract, or evidence of coverage delivered, issued for delivery,
4-8 or renewed on or after January 1, 2002. A policy, contract, or
4-9 evidence of coverage delivered, issued for delivery, or renewed
4-10 before January 1, 2002, is governed by the law as it existed
4-11 immediately before the effective date of this Act, and that law is
4-12 continued in effect for that purpose.
4-13 SECTION 4. This Act takes effect September 1, 2001.