S.B. 879 78(R)    BILL ANALYSIS


S.B. 879
By: Whitmire
Insurance
Committee Report (Unamended)

BACKGROUND AND PURPOSE 

Currently, an enrollee in a health maintenance organization (HMO) may
appeal an adverse determination made by the HMO in accordance with the
provisions of Chapter 843G (Dispute Resolution), Insurance Code.  However,
there is no provision that requires an HMO to abide by an appeal decision
that favors the enrollee.  SB 879 amends Chapter 843G to provide that if
an adverse determination is appealed and a decision is rendered in favor
of the enrollee, the decision is binding on the HMO.  

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

SECTION BY SECTION ANALYSIS 

SECTION 1. Amends Chapter 843, Subchapter G, Insurance Code, as effective
June 1, 2003, by adding Section 843.262 as follows:  

Sec. 843.262. CERTAIN DECISIONS BINDING. (a) Provides that if an enrollee,
a person acting on behalf of an enrollee, or an enrollee's provider of
record appeals an adverse determination as provided under Section 843.261
and the health maintenance organization (HMO) or utilization review agent,
as applicable, resolves the claim in favor of the enrollee, the decision
is binding on the health maintenance organization.  

(b) Requires an HMO to provide or arrange for the health care service
within a time frame that is appropriate for the treatment of the medical
condition that was the subject of the appeal, after a binding decision in
favor of an enrollee relating to a proposed health care service.  

(c) Requires an HMO, after a binding decision in favor of an enrollee
relating to a health care service already provided, to pay the cost of the
service within a certain time. Provides that an HMO that fails to pay the
cost of service is subject to penalties.  

(d) Provides that this section applies only to a health care plan of a
political subdivision that is exempt from application of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.).  

SECTION 2. Effective date: September 1, 2003. Makes application of this
Act prospective to January 1, 2004.  

EFFECTIVE DATE

September 1, 2003.