By Nelson                                               S.B. No. 11
         77R523 MCK-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to protecting the privacy of medical records; providing
 1-3     penalties.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Title 2, Health and Safety Code, is amended by
 1-6     adding Subtitle I to read as follows:
 1-7                        SUBTITLE I.  MEDICAL RECORDS
 1-8                    CHAPTER 181.  MEDICAL RECORDS PRIVACY
 1-9                      SUBCHAPTER A.  GENERAL PROVISIONS
1-10           Sec. 181.001.  DEFINITIONS.  In this chapter:
1-11                 (1)  "Administrative billing information" means
1-12     protected health information that is necessary for the payment or
1-13     administration of health care claims.  The term:
1-14                       (A)  includes only:
1-15                             (i)  date of service;
1-16                             (ii)  billed charges;
1-17                             (iii)  patient or practitioner identifiers;
1-18                             (iv)  diagnostic and treatment information
1-19     contained in standard billing codes;
1-20                             (v)  information required by nationally
1-21     recognized third-party health care claim forms; and
1-22                             (vi)  protected health information that is
1-23     part of a health care delivery review; and
1-24                       (B)  does not include a clinical health record
 2-1     included or requested as an attachment to administrative billing
 2-2     information.
 2-3                 (2)  "Audit trail" means a complete and accurate record
 2-4     of the date, user or recipient, and function performed with respect
 2-5     to the use or disclosure of protected health information.
 2-6                 (3)  "Clinical health record" means a record of any
 2-7     protected health information, other than administrative billing
 2-8     information, that is used or maintained by or for a health care
 2-9     practitioner or facility or an employee, agent, or contractor of a
2-10     health care practitioner or facility for the purpose of delivering
2-11     health care to an individual.
2-12                 (4)  "Computerized records system" means any
2-13     electronic, digital, optical, magnetic, or other system that
2-14     stores, retrieves, or manipulates data.  The term does not include
2-15     a static storage system, including microfiche or microfilm.
2-16                 (5)  "Covered entity" means any person who:
2-17                       (A)  for commercial, financial, or professional
2-18     gain, monetary fees, or dues, or on a cooperative, nonprofit or pro
2-19     bono basis, engages, in whole or in part, and with real or
2-20     constructive knowledge, in the practice of assembling, collecting,
2-21     analyzing, using, evaluating, storing, or transmitting protected or
2-22     deidentified health information.  The term includes a health care
2-23     payer, information or computer management entity, employer, school,
2-24     health researcher, health care facility, clinic, or health care
2-25     practitioner;
2-26                       (B)  obtains protected health information
2-27     pursuant to this chapter;
 3-1                       (C)  is an employee, agent, or contractor of a
 3-2     person described by Paragraph (A) or (B) insofar as the employee,
 3-3     agent, or contractor creates, receives, obtains, maintains, uses,
 3-4     or transmits protected health information; or
 3-5                       (D)  is a governmental entity.
 3-6                 (6)  "Deidentified health information" means protected
 3-7     health information with respect to which the holder has made a good
 3-8     faith effort to evaluate the risks of reidentification of the
 3-9     information in the context in which it will be used or disclosed
3-10     and removed all personal identifiers or other information that may
3-11     be used by itself or in combination with other information to
3-12     identify the subject from the information.  The term includes
3-13     aggregate statistics, redacted health information, information for
3-14     which random or fictitious alternatives have been substituted for
3-15     personally identifiable information, and information for which
3-16     personally identifiable information has been encrypted and for
3-17     which the encryption key is maintained by a person otherwise
3-18     authorized to have access to the information in an identifiable
3-19     format.
3-20                 (7)  "Disclose" means to release, publish, share,
3-21     transfer, transmit, distribute, show, or otherwise divulge
3-22     protected health information to a person other than the individual
3-23     who is the subject of the information.
3-24                 (8)  "Disease management" means a multidisciplinary,
3-25     continuum-based approach to health care delivery that:
3-26                       (A)  proactively identifies populations with, or
3-27     at risk for, established medical conditions;
 4-1                       (B)  supports the physician-patient relationship
 4-2     and plan of care;
 4-3                       (C)  emphasizes prevention of exacerbations and
 4-4     complications by using cost-effective, evidence-based practice
 4-5     guidelines and patient empowerment strategies, including
 4-6     self-management; and
 4-7                       (D)  continuously evaluates clinical, humanistic,
 4-8     and economic outcomes with the goal of improving overall health.
 4-9                 (9)  "Health care delivery review" means any review,
4-10     audit, assessment, or analysis of health care, including
4-11     utilization, quality assurance, or management review, that:
4-12                       (A)  is conducted in regard to an individual who
4-13     is the subject of protected health information;
4-14                       (B)  is performed by a health care payer or an
4-15     agent or contractor of a health care payer; and
4-16                       (C)  requires any protected health information
4-17     that is not deidentified other than administrative billing
4-18     information.
4-19                 (10)  "Health care facility" means any facility
4-20     licensed to provide health care or legally and regularly engaged in
4-21     providing health care, an employee, agent, or contractor of the
4-22     facility, or a health care practitioner with whom the facility has
4-23     an agreement or affiliation for the purpose of providing,
4-24     delivering, or arranging health care.  The term includes a
4-25     hospital, long-term care facility, or pharmacy. The term does not
4-26     include an employer, health care payer, or health maintenance
4-27     organization.
 5-1                 (11)  "Health care operations" means an activity
 5-2     undertaken by or on behalf of a health care facility, a health care
 5-3     payer, or a health care practitioner to carry out the management
 5-4     functions necessary for the support of treatment or payment,
 5-5     including:
 5-6                       (A)  conducting quality assessment and
 5-7     improvement activities, including outcomes evaluation and
 5-8     development of clinical guidelines;
 5-9                       (B)  reviewing the competence or qualifications
5-10     of health care professionals, evaluating practitioner and provider
5-11     performance or health plan performance, conducting training
5-12     programs in which undergraduate and graduate students and trainees
5-13     in areas of health care learn under supervision to practice as
5-14     health care providers, and reviewing accreditation, certification,
5-15     licensing, or credentialing activities;
5-16                       (C)  conducting insurance rating and other
5-17     insurance activities relating to renewal of a contract for
5-18     insurance, including underwriting, experience rating, and
5-19     reinsurance, but only if the individuals are already enrolled in
5-20     the health plan conducting activities and if the use of disclosure
5-21     of protected health information relates to an existing contract of
5-22     insurance or the renewal of a contract; and
5-23                       (D)  conducting or arranging for medical review
5-24     and auditing services, including fraud and abuse detection and
5-25     compliance programs.
5-26                 (12)  "Health care payer" means any person who provides
5-27     payment or reimbursement for health care, including a health
 6-1     insurance or other insurance company, hospital or medical service
 6-2     plan, health or dental service plan, health maintenance
 6-3     organization, employee welfare benefit plan, or other group health
 6-4     plan, regardless of whether the payment or reimbursement is funded
 6-5     through the purchase of insurance.
 6-6                 (13)  "Health care practitioner" means a person,
 6-7     including a physician, nurse, chiropractor, midwife, podiatrist,
 6-8     physician assistant, pharmacist, or optometrist, who:
 6-9                       (A)  is licensed, certified, registered, or
6-10     otherwise authorized by law to provide an item or service that, in
6-11     the ordinary course of business, constitutes health care;
6-12                       (B)  is an employee, agent, or contractor of a
6-13     person described by Paragraph (A) who is supervised by the person
6-14     described by Paragraph (A) in providing health care; or
6-15                       (C)  is a health care facility with whom the
6-16     person has an agreement or affiliation for the purpose of
6-17     providing, delivering, or arranging health care.
6-18                 (14)  "Health research" means any systematic
6-19     investigation, testing, evaluation, or other inquiry that uses
6-20     protected health information to develop or contribute to general
6-21     knowledge, including the study of:
6-22                       (A)  the causes of disease or medical conditions;
6-23     and
6-24                       (B)  the relationship among certain
6-25     characteristics, health care, and disease or health status.
6-26                 (15)  "Health researcher" means a person who has been
6-27     authorized by an institutional review board described by Section
 7-1     181.058(a) to conduct health research using protected or
 7-2     deidentified health information.
 7-3                 (16)  "Payment" includes:
 7-4                       (A)  determination of coverage, including
 7-5     appropriateness of care and justification of charges;
 7-6                       (B)  payment, adjudication, and subrogation of
 7-7     health care claims;
 7-8                       (C)  risk adjustment of amounts due based on
 7-9     enrollee health status and demographic characteristics;
7-10                       (D)  billing, claims management, and medical data
7-11     processing; and
7-12                       (E)  utilization review activities, including
7-13     preauthorization and precertification of services.
7-14                 (17)  "Protected health information" means any
7-15     information, including sensitive health information, administrative
7-16     billing information, and clinical health records, including
7-17     prescriptions, but not including deidentified health information
7-18     that is in the public domain, that:
7-19                       (A)  relates to:
7-20                             (i)  the past, present, or future physical
7-21     or mental health or condition of an individual;
7-22                             (ii)  the providing of health care to an
7-23     individual; or
7-24                             (iii)  the past, present, or future payment
7-25     for providing health care to an individual; and
7-26                       (B)  identifies or could be used or manipulated
7-27     by itself or in combination with other information to identify an
 8-1     individual by a reasonably foreseeable method.
 8-2                 (18)  "Reidentification" means any attempt to
 8-3     ascertain:
 8-4                       (A)  the identity of the individual who is the
 8-5     subject of protected health information; or
 8-6                       (B)  any specific data element with the intention
 8-7     of ascertaining the identity of the subject or with knowledge that
 8-8     the data element would allow for the identification of the
 8-9     individual who is the subject of the protected health information. 
8-10                 (19)  "Sensitive health information" means protected
8-11     health information that pertains specifically to:
8-12                       (A)  a history, diagnosis, or treatment of:
8-13                             (i)  substance abuse;
8-14                             (ii)  human immunodeficiency virus or
8-15     acquired immune deficiency syndrome;
8-16                             (iii)  sexually transmitted disease; or
8-17                             (iv)  sexual, physical, or mental abuse,
8-18     including information related to sexual assault;
8-19                       (B)  mental health;
8-20                       (C)  sexual or reproductive health; or
8-21                       (D)  the results of a genetic test, including the
8-22     fact that an individual has undergone a genetic test.
8-23                 (20)  "Treatment" means a health care treatment,
8-24     service, or procedure provided by a health care practitioner
8-25     designed to maintain or treat a patient's physical or mental
8-26     condition, as well as preventive care.  The term includes the
8-27     coordination of the provision of health care among health care
 9-1     practitioners and health care payers and patient referrals.
 9-2           Sec. 181.002.  APPLICABILITY. This chapter does not affect
 9-3     the confidentiality that another statute creates for any
 9-4     information.
 9-5           Sec. 181.003.  DELAYED EFFECT. (a)  A person is not required
 9-6     to comply with this chapter before September 1, 2003.
 9-7           (b)  This section expires September 1, 2003.
 9-8              (Sections 181.004-181.050 reserved for expansion
 9-9         SUBCHAPTER B.  ACCESS TO AND USE OF HEALTH CARE INFORMATION
9-10           Sec. 181.051.  PATIENT ACCESS TO INFORMATION; FEE.  (a)
9-11     Except as provided by Subsection (b), a covered entity shall permit
9-12     an individual who is the subject of a clinical health record or the
9-13     person's designee to inspect and copy any clinical health record,
9-14     except for any clinical health record collected or created in the
9-15     course of a clinical research trial, that the entity maintains or
9-16     controls and that relates to the individual.  The covered entity
9-17     may charge a reasonable fee for any copies.  The fee may not exceed
9-18     the covered entity's cost to copy the record.
9-19           (b)  A psychologist licensed under Chapter 501, Occupations
9-20     Code, or a psychiatrist who is providing psychological or
9-21     psychiatric services to an individual is not required to permit the
9-22     individual to inspect or copy a personal diary containing protected
9-23     health information relating to the individual if the information
9-24     contained in the diary has not been disclosed to a person other
9-25     than another psychologist or psychiatrist for the specific purpose
9-26     of clinical supervision conducted in the regular course of
9-27     treatment.
 10-1          (c)  Not later than the 30th day after the date a covered
 10-2    entity receives a request and payment under Subsection (a), the
 10-3    covered entity shall provide the requested information.
 10-4          Sec. 181.052.  DISCLOSURE OR USE OF PROTECTED HEALTH
 10-5    INFORMATION.  (a)  A covered entity may not disclose or use
 10-6    protected health information except as authorized under this
 10-7    chapter.
 10-8          (b)  Except as otherwise provided by law, a covered entity
 10-9    may not use or disclose protected health information without
10-10    obtaining the informed consent of the individual who is the subject
10-11    of the information.
10-12          (c)  A covered entity may not use or request or require the
10-13    disclosure of more protected health information than is reasonably
10-14    related to the specific purpose that is stated in the informed
10-15    consent or that is otherwise authorized by law.
10-16          (d)  Except as otherwise provided by law, a covered entity
10-17    may use or disclose protected health information only for the
10-18    purpose stated in the informed consent.
10-19          (e)  A covered entity may disclose or use protected health
10-20    information without obtaining the informed consent of the
10-21    individual who is the subject of the information if the disclosure
10-22    or use is necessary to perform health care operations.
10-23          (f)  A covered entity may disclose protected health
10-24    information without obtaining the informed consent of the
10-25    individual who is the subject of the information if the disclosure
10-26    is made in response to a subpoena in a judicial or administrative
10-27    proceeding.
 11-1          (g)  A person who receives information made confidential by
 11-2    this chapter may disclose the information only to the extent
 11-3    consistent with the authorized uses stated in the informed consent.
 11-4          Sec. 181.053.  USE OF CLINICAL HEALTH RECORDS.  (a)  Except
 11-5    as provided by Section 181.054, this chapter does not limit the
 11-6    ability of a health care practitioner, a health care facility, a
 11-7    health care payer, or a contractor of a health care payer to use
 11-8    protected health information to:
 11-9                (1)  provide health care to the individual who is the
11-10    subject of the information; or
11-11                (2)  perform a health care delivery review.
11-12          (b)  With respect to a clinical health record used for any
11-13    purpose other than to deliver health care to the individual who is
11-14    the subject of the record, the covered entity using the record
11-15    shall:
11-16                (1)  limit access to a clinical health record that is
11-17    not deidentified to only those employees, agents, or contractors
11-18    who perform an essential function that is directly related to the
11-19    purpose for which the record was created or collected;
11-20                (2)  prohibit an employee, agent, or contractor from
11-21    reidentifying an individual who is the subject of any deidentified
11-22    health information used, received, or created by the employee,
11-23    agent, or contractor unless otherwise authorized by law;
11-24                (3)  require that an employee, agent, or contractor use
11-25    or receive only the minimum amount of information from a clinical
11-26    health record that is essential and directly related to the
11-27    specific function performed by the employee, agent, or contractor;
 12-1                (4)  prohibit an employee, agent, or contractor from
 12-2    using or having access to a clinical health record for longer than
 12-3    is necessary to perform the specific function of the employee,
 12-4    agent, or contractor;
 12-5                (5)  prohibit an employee, agent, or contractor from
 12-6    disclosing a clinical health record or deidentified health
 12-7    information to any other person except as otherwise authorized
 12-8    under this chapter;
 12-9                (6)  link, match, or index clinical health records
12-10    collected, held, or maintained by other covered entities only if
12-11    the entity has specific informed consent; and
12-12                (7)  disclose a clinical health record collected from
12-13    or created by any other covered entity only to the individual who
12-14    is the subject of the information or as otherwise authorized by
12-15    law.
12-16          Sec. 181.054.  USE OF ADMINISTRATIVE BILLING INFORMATION. (a)
12-17    With respect to administrative billing information used by a
12-18    covered entity, the entity shall:
12-19                (1)  limit the use of administrative billing
12-20    information that is not deidentified to those employees, agents, or
12-21    contractors who perform an essential function;
12-22                (2)  prohibit an employee, agent, or contractor from
12-23    reidentifying an individual who is the subject of any deidentified
12-24    health information used, received, or created by the employee,
12-25    agent, or contractor unless otherwise authorized by law;
12-26                (3)  require that an employee, agent, or contractor use
12-27    only the minimum amount of administrative billing information that
 13-1    is necessary to accomplish the specific function performed by the
 13-2    employee, agent, or contractor;
 13-3                (4)  prohibit an employee, agent, or contractor from
 13-4    disclosing administrative billing information or deidentified
 13-5    health information to any other person except as otherwise
 13-6    authorized under this chapter; and
 13-7                (5)  link, match, or index administrative billing
 13-8    information collected, held, or maintained by other covered
 13-9    entities only if the entity has specific informed consent.
13-10          (b)  Except as otherwise provided by this chapter, a health
13-11    care provider, a health care facility, a health care payer, or an
13-12    employee, agent, or contractor of a provider, facility, or payer
13-13    may use administrative billing information without the informed
13-14    consent of the individual who is the subject of the information
13-15    only if the health care provider, facility, or payer:
13-16                (1)  deidentifies all the information used by the
13-17    entity; or
13-18                (2)  uses only the minimum amount of administrative
13-19    billing information that is essential and reasonably related to the
13-20    specific function to be performed by the recipient and does not
13-21    store, preserve, copy, or otherwise maintain the information for
13-22    longer than is necessary to perform the specific function of the
13-23    recipient or as otherwise authorized by law.
13-24          (c)  The board by rule shall determine which employees,
13-25    agents, or contractors perform an essential function under
13-26    Subsection (a)(1).
13-27          Sec. 181.055.  SENSITIVE HEALTH INFORMATION. (a)  A covered
 14-1    entity shall obtain separate informed consent documentation for the
 14-2    disclosure of sensitive health information.
 14-3          (b)  A covered entity shall comply with a request from an
 14-4    individual who is the subject of sensitive health information to
 14-5    restrict access within the entity to the information.  If a health
 14-6    care practitioner or health care facility believes that restricting
 14-7    access to the information may endanger the life or health of the
 14-8    subject, the practitioner or facility may require the subject to
 14-9    sign an acknowledgment that the restriction is against medical
14-10    advice.  A covered entity may use any reasonable means to restrict
14-11    access to the information.  This subsection does not apply to
14-12    administrative billing information.
14-13          (c)  An individual may not restrict a health care provider's
14-14    access to sensitive health information under this section if the
14-15    health care provider is directly involved in the delivery of health
14-16    care to the individual.
14-17          (d)  A covered entity may not withhold sensitive health
14-18    information requested under an informed consent document.
14-19          Sec. 181.056.  DIRECTORY INFORMATION. (a)  Except as provided
14-20    by Subsection (b), a health care practitioner or health care
14-21    facility that provides inpatient services may disclose directory
14-22    information regarding an individual to any person if:
14-23                (1)  the inpatient:
14-24                      (A)  has been notified of the inpatient's right
14-25    to object at the time of admission to the facility and has not
14-26    objected to the disclosure; or
14-27                      (B)  is in a physical or mental condition that
 15-1    makes it impossible to notify the inpatient of the right to object
 15-2    and there are no prior indications that the inpatient would object;
 15-3    and
 15-4                (2)  the information consists of:
 15-5                      (A)  the name of the inpatient;
 15-6                      (B)  the nature of the inpatient's injury;
 15-7                      (C)  the municipality, if any, and the county
 15-8    where the inpatient resides;
 15-9                      (D)  the inpatient's sex;
15-10                      (E)  the inpatient's age;
15-11                      (F)  the general health status of the inpatient,
15-12    described as critical, poor, fair, stable, or satisfactory or in
15-13    terms denoting similar conditions; or
15-14                      (G)  the location of the inpatient on premises
15-15    controlled by the practitioner or facility.
15-16          (b)  A health care practitioner or health care facility may
15-17    not release inpatient directory information without informed
15-18    consent if:
15-19                (1)  disclosure of the location of the individual would
15-20    reveal information supporting all inferences about the specific
15-21    diagnosis of the individual; or
15-22                (2)  the practitioner or facility has reason to believe
15-23    that the disclosure of the information could lead to physical,
15-24    mental, or emotional harm to or the death of the individual.
15-25          Sec. 181.057.  NEXT OF KIN. (a)  A health care practitioner
15-26    or health care facility may disclose, without the patient's
15-27    consent, protected health information regarding the health care
 16-1    provided to the patient if:
 16-2                (1)  the patient:
 16-3                      (A)  has been notified of the patient's right to
 16-4    object at the time of admission to the facility and has not
 16-5    objected to the disclosure; or
 16-6                      (B)  is in a physical or mental condition that
 16-7    makes it impossible to notify the patient of the right to object;
 16-8    and
 16-9                (2)  the information is disclosed to the patient's next
16-10    of kin, a representative of the patient, or an individual with whom
16-11    the patient resides.
16-12          (b)  A health care practitioner or health care facility is
16-13    not liable for a disclosure made in good faith under Subsection
16-14    (a).
16-15          Sec. 181.058.  INFORMATION FOR RESEARCH. (a)  A covered
16-16    entity may disclose protected health information to a health
16-17    researcher for the purpose of conducting health research only if:
16-18                (1)  an institutional review board, ethics review
16-19    board, or privacy review board acting in compliance with part 46 of
16-20    Title 45 or part 56 of Title 21 of the Code of Federal Regulations
16-21    as they appear in the October 1996 edition approves the research in
16-22    accordance with this section; and
16-23                (2)  the researcher has obtained either:
16-24                      (A)  the informed consent of the individual; or
16-25                      (B)  a waiver of informed consent granted by the
16-26    institutional review board, ethics review board, or privacy review
16-27    board under this section.
 17-1          (b)  An institutional review board, ethics review board, or
 17-2    privacy review board may grant a waiver or alteration of the
 17-3    informed consent for the use of protected health information if the
 17-4    board:
 17-5                (1)  meets the requirements of Section 46.110(d) of
 17-6    Title 45 as it appears in the October 1996 edition of the Code of
 17-7    Federal Regulations;
 17-8                (2)  determines and documents that:
 17-9                      (A)  there is no practicable alternative to the
17-10    use of the protected health information and that the information
17-11    will be deidentified at the earliest practicable opportunity;
17-12                      (B)  the health researcher has fully disclosed
17-13    which of the protected health information to be collected or
17-14    created will be linked to other protected health information;
17-15                      (C)  appropriate safeguards will be used to
17-16    protect the information against reidentification or subsequent
17-17    unauthorized linkage if, in the course of the proposed research,
17-18    the health researcher intends to link protected health information
17-19    to other protected health information or if there is a risk that
17-20    the information may be linked;
17-21                      (D)  at the conclusion of the proposed health
17-22    research or at some specific date, the health researcher will
17-23    destroy all of the data containing protected health information as
17-24    well as all copies of the data; and
17-25                      (E)  the health researcher has presented adequate
17-26    assurances that none of the data containing protected health
17-27    information will be given, loaned, sold, disseminated, or otherwise
 18-1    disclosed to other parties; and
 18-2                (3)  has the opportunity to review any publication of
 18-3    information based on the protected health information collected or
 18-4    created under this section to ensure that no disclosures are made
 18-5    that might identify an individual.
 18-6          (c)  In determining whether to grant a waiver under
 18-7    Subsection (b), an institutional review board, ethics review board,
 18-8    or privacy review board may consider whether the health researcher
 18-9    is qualified for and is likely to obtain a certificate of
18-10    confidentiality from the U.S. Department of Health and Human
18-11    Services pursuant to Section 301(d) of the Public Health Service
18-12    Act (42 U.S.C. Section 241(d)).
18-13          (d)  The institutional review board, ethics review board, or
18-14    privacy review board may extend the date of destruction required by
18-15    Subsection (b)(2)(D) if the researcher demonstrates a continuing or
18-16    new need for protected health information for which the researcher
18-17    would be qualified for a waiver of informed consent in accordance
18-18    with this section.
18-19          (e)  A health researcher performing research on deidentified
18-20    health information is not required to obtain a waiver or alteration
18-21    of the informed consent.
18-22          (f)  For purposes of this section, if a health researcher
18-23    receives protected health information that is not deidentified, the
18-24    health information is considered deidentified health information if
18-25    explicit or commonly used identifiers are encrypted by the
18-26    researcher at the earliest opportunity and the encryption code or
18-27    key is maintained by a person authorized to have access to the
 19-1    information or an institutional review board, ethics review board,
 19-2    or privacy review board acting in accordance with this section.
 19-3          (g)  Documentation of findings by an institutional review
 19-4    board, ethics review board, or privacy review board under this
 19-5    section shall be made available on request by:
 19-6                (1)  the department;
 19-7                (2)  the office of the attorney general; and
 19-8                (3)  any individual whose protected health information
 19-9    is disclosed or used pursuant to this section.
19-10          (h)  A health researcher may not use or disclose protected
19-11    health information for any purposes other than those specifically
19-12    approved by the institutional review board, ethics review board, or
19-13    privacy review board and directly related to the research being
19-14    performed.
19-15          (i)  Protected and deidentified health information collected
19-16    or used pursuant to this section is immune from any compulsory
19-17    legal process that does not directly concern the research being
19-18    performed.
19-19          Sec. 181.059.  APPENDANT TO HEALTH RECORDS. (a)  An
19-20    individual may request in writing that a health care practitioner
19-21    or health care facility that is providing health care to the
19-22    individual make an appendant to the individual's clinical health
19-23    record.  The health care practitioner or health care facility may
19-24    limit the length of the appendant to two letter-sized pages.
19-25          (b)  Not later than the 90th day after the date the health
19-26    care practitioner or health care facility receives a written
19-27    request to make an appendant to the individual's clinical health
 20-1    record, the health care practitioner or health care facility shall:
 20-2                (1)  make the appendant requested and on request
 20-3    provide the individual with a list of the entities to whom the
 20-4    record was disclosed before the appendant was made; or
 20-5                (2)  inform the individual of:
 20-6                      (A)  the reasons for refusing to make the
 20-7    appendant; and
 20-8                      (B)  any procedures for further review of the
 20-9    refusal.
20-10          (c)  A health care practitioner or health care facility may
20-11    not unreasonably refuse to make an appendant to a clinical health
20-12    record.
20-13          (d)  If a health care practitioner or health care facility
20-14    refuses to make an appendant to a clinical health record, the
20-15    health care practitioner or health care facility shall comply with
20-16    a reasonable request of the individual to include at a relevant
20-17    place in the record a statement from the individual regarding the
20-18    disputed information.
20-19          (e)  For purposes of Subsection (a), an appendant is
20-20    considered to have been made if the information that has been
20-21    disputed by the individual has been supplemented by or replaced
20-22    with appended information and the information is clearly marked as
20-23    appended.
20-24          (f)  A covered entity that receives clinical health records
20-25    to which an appendant has been made shall:
20-26                (1)  make the same appendant that the practitioner or
20-27    facility made not later than the 90th day after the date the
 21-1    covered entity receives the records; and
 21-2                (2)  make reasonable efforts to give notice of the
 21-3    appendant to each person to whom the covered entity disclosed the
 21-4    records before the appendant was made.
 21-5          (g)  This section does not apply to a clinical health record
 21-6    that has not been used or disclosed during the seven years before
 21-7    the date of the request to make the appendant to the record.
 21-8          Sec. 181.060.  REQUIRED NOTICE. (a)  A covered entity shall
 21-9    provide written notice to an individual of the entity's practices
21-10    with respect to protected health information.  The covered entity
21-11    shall provide the individual with written notice of any change in
21-12    the entity's practices with respect to protected health
21-13    information.
21-14          (b)  Notice under this section must include:
21-15                (1)  a reasonably complete description of the usual
21-16    functions performed with protected health information that has not
21-17    been deidentified;
21-18                (2)  a statement of whether protected health
21-19    information is stored in a computerized records system;
21-20                (3)  the name and the method of contacting the
21-21    individual responsible for responding to inquiries regarding the
21-22    entity's information practices; and
21-23                (4)  the procedures an individual must follow to
21-24    exercise the rights granted under this chapter.
21-25          (c)  On written request by an individual, a covered entity
21-26    shall provide a list of the agents or contractors who ordinarily
21-27    have direct access to or use of protected health information that
 22-1    is not deidentified.
 22-2          (d)  The board shall develop and disseminate a model notice
 22-3    of information practices of the type described by this section.  In
 22-4    adopting the model notice, the board shall follow the same
 22-5    procedure the board follows under the administrative procedure law,
 22-6    Chapter 2001, Government Code, for adopting a rule.  Any notice
 22-7    that conforms to the model notice developed under this subsection
 22-8    is considered to meet the notice requirements of this section.
 22-9          Sec. 181.061.  MARKETING AND EDUCATIONAL INFORMATION. (a)  A
22-10    covered entity may not send an individual who is the subject of
22-11    protected health information marketing material for a product
22-12    related to the treatment of the individual's medical condition.
22-13          (b)  A covered entity may send an individual who is the
22-14    subject of protected health information educational information
22-15    related to the individual's medical condition.
22-16             (Sections 181.062-181.100 reserved for expansion
22-17                     SUBCHAPTER C.  HEALTH CARE PAYERS
22-18          Sec. 181.101.  NOTICE TO INDIVIDUAL.  A health care payer
22-19    shall, on enrollment, notify an individual who is the subject of
22-20    protected health information:
22-21                (1)  of the regular uses of the information, including
22-22    administrative billing information; and
22-23                (2)  that protected health information will be accessed
22-24    in the event of an investigation, complaint, appeal, or other
22-25    grievance made by or relating to the subject.
22-26          Sec. 181.102.  CONTACT WITH PATIENT.  (a)  A health care
22-27    payer may not initiate contact with the subject of sensitive health
 23-1    information regarding any disease management or other clinical
 23-2    intervention program relating to the sensitive health condition
 23-3    until the sixth business day after the date the health care payer
 23-4    notifies the health care practitioner or facility that is treating
 23-5    the subject of the information of the health care payer's intent to
 23-6    initiate contact.
 23-7          (b)  A health care payer may send mail addressed to an
 23-8    individual regarding any health topic, including generic material
 23-9    regarding sensitive health information, if the material does not
23-10    name or otherwise identify the individual in the material sent.
23-11          Sec. 181.103.  DISEASE MANAGEMENT PROGRAM.  (a)  A health
23-12    care payer or employer may not require as a condition of
23-13    employment, health insurance, or coverage or reimbursement for
23-14    health care that an individual participate in a disease management
23-15    program or other clinical intervention program.
23-16          (b)  This section does not prevent a health care payer from
23-17    designating the manner of any specific benefit offered by the
23-18    payer.
23-19          Sec. 181.104.  CONSENT REQUIRED.  Unless otherwise authorized
23-20    by law, informed consent provided by an enrollee or member in any
23-21    health plan is not valid as to anyone other than that enrollee or
23-22    member.
23-23          Sec. 181.105.  HEALTH CARE DELIVERY REVIEW.  For the purpose
23-24    of performing health care delivery review, a health care payer may
23-25    request protected health information only if the information is
23-26    essential for the review.  Protected health information collected
23-27    for the performance of health care delivery review may not be used
 24-1    for any other purpose unless otherwise authorized by law.  The
 24-2    board by rule shall determine what information is essential to
 24-3    perform a health care review.
 24-4            (Sections 181.106-181.150 reserved for expansion 
 24-5                      SUBCHAPTER D.  INFORMED CONSENT
 24-6          Sec. 181.151.  FORM.  (a)  Informed consent required by this
 24-7    chapter must be in writing and signed by:
 24-8                (1)  the individual who is the subject of the health
 24-9    information;
24-10                (2)  the individual's legal guardian; or
24-11                (3)  the individual's agent under a medical power of
24-12    attorney.
24-13          (b)  For purposes of this section, documentation of informed
24-14    consent may be satisfied by the use of electronic signatures,
24-15    computerized informed consent documentation, or other technological
24-16    means of recording informed consent.
24-17          Sec. 181.152.  CONTENT OF CONSENT. The written informed
24-18    consent must:
24-19                (1)  describe the information to be used or disclosed
24-20    in clear, concise, and plain language;
24-21                (2)  clearly identify the covered entity that will
24-22    disclose the information;
24-23                (3)  clearly identify the person:
24-24                      (A)  who will use the information; or
24-25                      (B)  to whom the information will be disclosed;
24-26                (4)  describe in reasonable detail the purpose for
24-27    which the information is being disclosed or used;
 25-1                (5)  state that the information will be used or
 25-2    disclosed solely for the purpose specified in the informed consent
 25-3    or as otherwise authorized by law;
 25-4                (6)  contain a specific date or event at which the
 25-5    authorization expires;
 25-6                (7)  contain a statement that the individual has the
 25-7    right to:
 25-8                      (A)  revoke or amend the authorization in
 25-9    accordance with this chapter;
25-10                      (B)  receive the notice required by Section
25-11    181.060;
25-12                      (C)  inspect, copy, and request an amendment of
25-13    protected health information;
25-14                      (D)  be informed of those circumstances under
25-15    which health information may be used or disclosed without informed
25-16    consent under a court order or other proper legal process issued by
25-17    a federal or state administrative agency or any other legal
25-18    requirement; and
25-19                      (E)  refuse to sign any informed consent
25-20    documentation that is valid for longer than two years; and
25-21                (8)  state that a written notice of information
25-22    practices has been provided.
25-23          Sec. 181.153.  EXPIRATION. (a)  An informed consent for the
25-24    use of protected health information is valid until the expiration
25-25    date or event specified in the documentation or until it is revoked
25-26    by the individual.
25-27          (b)  A person may not coerce an individual to sign an
 26-1    informed consent document.
 26-2          Sec. 181.154.  REVOCATION. The subject of protected health
 26-3    information may revoke or amend an informed consent at any time
 26-4    unless:
 26-5                (1)  a disclosure or use has already been made in
 26-6    reliance on the consent; or
 26-7                (2)  disclosure or use of protected information is made
 26-8    for payment or reimbursement for health care that has previously
 26-9    been delivered and for which the subject is not providing other
26-10    payment for the care.
26-11          Sec. 181.155.  MODEL CONSENT.  The board shall develop and
26-12    distribute a model informed consent form.  In adopting the model
26-13    consent form, the board shall follow the same procedure the board
26-14    follows under the administrative procedure law, Chapter 2001,
26-15    Government Code.  An informed consent obtained on a model form
26-16    developed or approved by the board is considered to meet the
26-17    requirements of this subchapter.
26-18             (Sections 181.156-181.200 reserved for expansion
26-19                      SUBCHAPTER E.  PROHIBITED ACTS
26-20          Sec. 181.201.  DEIDENTIFIED INFORMATION. Unless otherwise
26-21    authorized by law, a person or governmental entity may not identify
26-22    or attempt to identify an individual who is the subject of any
26-23    deidentified health information.
26-24          Sec. 181.202.  COERCED CONSENT. (a)  A covered entity may not
26-25    condition the provision of health care to an individual on the
26-26    provision of an informed consent to use or disclose the information
26-27    for any purpose that is not essential and directly related to the
 27-1    purpose of providing health care, performing health care delivery
 27-2    review, or administrating or paying a health care claim.
 27-3          (b)  An employer may not condition terms of employment on the
 27-4    provision of informed consent to use or disclose any protected
 27-5    health information that is not either:
 27-6                (1)  deidentified; or
 27-7                (2)  necessary and directly related to the job duties
 27-8    performed by the individual.
 27-9          Sec. 181.203.  REFUSAL TO PROVIDE HEALTH CARE. Except as
27-10    otherwise provided by law, a person may not refuse to provide
27-11    health care to an individual who refuses to consent to the
27-12    disclosure or use of protected health information as long as the
27-13    individual is not requesting payment or reimbursement for the
27-14    health care from a third party.
27-15             (Sections 181.204-181.250 reserved for expansion
27-16                        SUBCHAPTER F.  ENFORCEMENT
27-17          Sec. 181.251.  INJUNCTIVE RELIEF; CIVIL PENALTY. (a)  The
27-18    attorney general may institute an action for injunctive or
27-19    declaratory relief to restrain a violation of this chapter.
27-20          (b)  In addition to the injunctive relief provided by
27-21    Subsection (a), the attorney general may institute an action for
27-22    civil penalties against a covered entity for a violation of this
27-23    chapter.  A civil penalty assessed under this section may not
27-24    exceed $3,000 for each violation.
27-25          (c)  If the court in which an action under Subsection (b) is
27-26    pending finds that the violations have occurred with a frequency as
27-27    to constitute a pattern or practice, the court may:
 28-1                (1)  assess a civil penalty not to exceed $250,000; and
 28-2                (2)  exclude the covered entity from participating in
 28-3    any state-funded health care program.
 28-4          (d)  If the attorney general substantially prevails in an
 28-5    action for injunctive relief or a civil penalty under this section,
 28-6    the attorney general may recover reasonable attorney's fees, costs,
 28-7    and expenses incurred obtaining the relief or penalty, including
 28-8    court costs and witness fees.
 28-9          Sec. 181.252.  INDIVIDUAL INJUNCTIVE RELIEF; CIVIL CAUSE OF
28-10    ACTION. (a)  An individual who is aggrieved by a violation of this
28-11    chapter may institute an action against a covered entity for
28-12    appropriate injunctive or declaratory relief.
28-13          (b)  The individual may institute an action for civil
28-14    damages.  An individual who prevails in an action may recover:
28-15                (1)  the greater of:
28-16                      (A)  the individual's actual damages; or
28-17                      (B)  liquidated damages in the amount of $3,000;
28-18    and
28-19                (2)  punitive damages.
28-20          (c)  If the alleged violation involves sensitive health
28-21    information, the individual may recover:
28-22                (1)  the greater of:
28-23                      (A)  the individual's actual damages; or
28-24                      (B)  liquidated damages in the amount of $10,000;
28-25    and
28-26                (2)  punitive damages.
28-27          (d)  If the individual is the prevailing party, the court may
 29-1    award reasonable attorney's fees and other litigation costs and
 29-2    expenses reasonably incurred, including expert fees.
 29-3          (e)  A civil action brought under this section must be
 29-4    commenced not later than:
 29-5                (1)  three years after the date the cause of action
 29-6    accrues; or
 29-7                (2)  one year after the date the cause of action was
 29-8    discovered but not longer than five years after the date the cause
 29-9    of action accrued.
29-10          Sec. 181.253.  CRIMINAL OFFENSE. (a)  A person commits an
29-11    offense if the person knowingly uses, discloses, reidentifies,
29-12    obtains, or induces another to use, disclose, reidentify, or obtain
29-13    protected health information for commercial advantage or personal
29-14    gain or to cause malicious harm in violation of this chapter.
29-15          (b)  An offense under this section is a state jail felony
29-16    unless the person committed the offense under false pretenses, in
29-17    which event the offense is a third degree felony.
29-18          Sec. 181.254.  DISCIPLINARY ACTION. In addition to the
29-19    penalties prescribed by this chapter, a violation of this chapter
29-20    by an individual or facility that is licensed by an agency of this
29-21    state is subject to the same consequence as a violation of the
29-22    licensing law applicable to the individual or facility or of a rule
29-23    adopted under that licensing law.
29-24          Sec. 181.255.  SOVEREIGN IMMUNITY. This chapter does not
29-25    waive sovereign immunity to suit or liability.
29-26          SECTION 2.  This Act takes effect September 1, 2001.