79R9147 T
By: Dukes H.B. No. 2279
A BILL TO BE ENTITLED
AN ACT
relating to the adequacy of health maintenance organization health
care delivery networks and availability of preferred provider
benefits; providing penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter D, Chapter 843, Insurance Code is
amended by adding Section 843.114 to read as follows:
Sec. 843.114. ADEQUACY OF HEALTH MAINTENANCE ORGANIZATION
DELIVERY NETWORK. (a) All covered services that are offered by the
health maintenance organization shall be sufficient in number and
location to be readily available and accessible within the service
area to all enrollees.
(b) A health maintenance organization shall make general,
special, and psychiatric hospital care available and accessible 24
hours per day, seven days per week, within the health maintenance
organization's service area.
(c) Health maintenance organizations must arrange for
covered health care services, including referrals to specialists,
to be accessible to enrollees on a timely basis upon request and
consistent with guidelines set out in paragraphs (1)-(3) of this
subsection:
(1) Urgent care shall be available within 24 hours for
medical, dental, and behavioral health conditions.
(2) Routine care shall be available:
(A) within three weeks for medical conditions;
(B) within eight weeks for dental conditions; and
(C) within two weeks for behavioral health
conditions.
(3) Preventive health services shall be available:
(A) within two months for a child 16 years of age
or younger;
(B) within three months for an adult; and
(C) within four months for dental services.
(d) All covered services must be accessible and available so
that travel distances from any point in its service area to a point
of service are no greater than:
(1) 30 miles for primary care and general hospital
care; and
(2) 75 miles for specialty care.
(e) The HMO shall not be required to expand services outside
its service area to accommodate enrollees who live outside the
service area, but work within the service area.
(f) There shall be a sufficient number of primary care
physicians and specialists with privileges in each participating
hospital within the health maintenance organization delivery
network who are available and accessible 24 hours per day, seven
days per week, within the health maintenance organization's service
area to meet the health care needs of the health maintenance
organization's enrollees.
(1) The number of primary care physicians and
specialists at a participating hospital is not sufficient to meet
the health care needs of the health maintenance organization's
enrollees if any of the following conditions are present:
(A) the health maintenance organization does not
have a contractual relationship with all physicians or physician
groups providing medical services pursuant to exclusive
arrangements between the participating hospital and physicians or
physician groups;
(B) the health maintenance organization does not
have a contractual relationship with all physicians or physician
groups who are compensated by the participating hospital for
emergency room call coverage; or
(C) the health maintenance organization does not
have a contractual relationship with a particular physician or
particular physician group exclusively providing specialty medical
services in a participating hospital by the virtue of being the only
such specialist or specialist group practicing within the general
geographic area around the participating hospital.
(g) If a health maintenance organization limits enrollees'
access to a limited provider network, it must ensure that such
limited provider network complies with the provisions of this
section.
(h) Except as provided in Chapter 1456, in addition to any
corrective action plan the department may require, a health
maintenance organization shall be subject to an administrative
penalty for failure to meet the requirements of subsection (f).
Each day the health maintenance organization delivery network fails
to meet the requirements of subsection (f) is a separate violation.
SECTION 2. Subchapter D, Chapter 1271, Insurance Code,
Section 1271.055, as effective April 1, 2005 is amended to read as
follows:
Sec. 1271.055. OUT-OF-NETWORK SERVICES. (a) An evidence
of coverage must contain a provision regarding non-network
physicians and providers in accordance with the requirements of
this section.
(b) If medically necessary covered services are not
available through network physicians or providers, the health
maintenance organization, on the request of a network physician or
provider and within a reasonable period, shall:
(1) allow referral to a non-network physician or
provider; and
(2) fully reimburse the non-network physician or
provider the amount as submitted on the claim by the non-network
physician or provider [at the usual and customary rate or at an
agreed rate].
(c) Before denying a request for a referral to a non-network
physician or provider, a health maintenance organization must
provide for a review conducted by a specialist of the same or
similar type of specialty as the physician or provider to whom the
referral is requested.
(d) If medical services are provided by a non-network
physician within a hospital participating in the health maintenance
organization delivery network, the health maintenance organization
shall fully reimburse the non-network physician or provider the
amount as submitted on the claim by the non-network physician or
provider.
(1) This subsection shall not be construed to limit or
modify the enforceability of Section 552.003, regarding charging of
different prices.
SECTION 3. Subchapter D, Chapter 1271, Insurance Code,
Section 1271.155 as effective April 1, 2005 is amended to read as
follows:
Sec. 1271.155. EMERGENCY CARE. (a) A health maintenance
organization shall pay for emergency care performed by non-network
physicians or providers at the amount as submitted on the claim
[usual and customary rate or at an agreed rate].
(b) A health care plan of a health maintenance organization
must provide the following coverage of emergency care:
(1) a medical screening examination or other
evaluation required by state or federal law necessary to determine
whether an emergency medical condition exists shall be provided to
covered enrollees in a hospital emergency facility or comparable
facility;
(2) necessary emergency care shall be provided to
covered enrollees, including the treatment and stabilization of an
emergency medical condition; and
(3) services originated in a hospital emergency
facility or comparable facility following treatment or
stabilization of an emergency medical condition shall be provided
to covered enrollees as approved by the health maintenance
organization, subject to Subsections (c) and (d).
(c) A health maintenance organization shall approve or deny
coverage of poststabilization care as requested by a treating
physician or provider within the time appropriate to the
circumstances relating to the delivery of the services and the
condition of the patient, but not to exceed one hour from the time
of the request.
(d) A health maintenance organization shall respond to
inquiries from a treating physician or provider in compliance with
this provision in the health care plan of the health maintenance
organization.
(e) A health care plan of a health maintenance organization
shall comply with this section regardless of whether the physician
or provider furnishing the emergency care has a contractual or
other arrangement with the health maintenance organization to
provide items or services to covered enrollees.
(f) Nothing in this section shall be construed to limit or
modify the enforceability of Section 552.003, regarding charging
different prices.
SECTION 4. Subchapter A, Chapter 1301, Insurance Code,
Section 1301.005, as effective April 1, 2005 is amended to read as
follows:
Sec. 1301.005. AVAILABILITY OF PREFERRED PROVIDERS. (a)
An insurer offering a preferred provider benefit plan shall ensure
that both preferred provider benefits and basic level benefits are
reasonably available to all insureds within a designated service
area.
(b) If services are not available through a preferred
provider within the service area or if services are provided by
nonpreferred providers within a preferred provider hospital, an
insurer shall reimburse a physician or health care provider who is
not a preferred provider at the same percentage level of
reimbursement as a preferred provider would have been reimbursed
had the insured been treated by a preferred provider.
(c) Subsection (b) does not require reimbursement at a
preferred level of coverage solely because an insured resides out
of the service area and chooses to receive services from a provider
other than a preferred provider for the insured's own convenience.
(d) Preferred provider benefits are not reasonably
available within a designated service area if any of the following
conditions are present:
(1) the preferred provider benefit plan does not have
a contractual relationship with all physicians or physician groups
providing medical services pursuant to exclusive arrangements
between the preferred provider hospital and physicians or physician
groups;
(2) the preferred provider benefit plan does not have
a contractual relationship with all physicians or physician groups
who are compensated by a preferred provider hospital for emergency
room call coverage; or
(3) the preferred provider benefit plan does not have
a contractual relationship with a particular physician or
particular physician group exclusively providing specialty medical
services in a preferred provider hospital by the virtue of being the
only such specialist or specialist group practicing within the
general geographic area around the preferred provider hospital.
(e) Reimbursement for services provided by a nonpreferred
provider pursuant to this section shall be calculated based solely
upon the unadjusted amount as submitted on the claim by the
nonpreferred provider.
(f) Except as provided in Chapter 1456, in addition to any
corrective action plan the department may require, a preferred
provider benefit plan shall be subject to an administrative penalty
for failure to meet the requirements of subsection (d). Each day
the preferred provider benefit plan fails to meet the requirements
of subsection (d) is a separate violation.
(g) Nothing in this section shall be construed to limit or
modify the enforceability of Section 552.003, regarding charging
different prices.
SECTION 5. Title 8, Texas Insurance Code is amended by
adding Chapter 1456 to read as follows:
CHAPTER 1456. MANDATORY MEDIATION.
Section 1456.001. DEFINITIONS. In this chapter:
(a) "Consensus Panel" is a panel of three mediators that
facilitates the agreement of the parties.
(b) "Health Plan" means a health maintenance organization
or preferred provider benefit plan authorized to do business in
this state.
(c) "Mediation" means a process in which an impartial
consensus panel facilitates and promotes voluntary agreement
between the parties in regard to participation in a health care
delivery network.
(1) Except as provided in Section 1456.008, a mediator
may not impose his own judgement on the issues for that of the
parties.
(d) "Mediator" means an impartial person who is appointed as
a member of the consensus panel.
(e) "Parties" or "Party" means the health plan and/or the
physician or physician group participating in the mediation.
Section 1456.002. QUALIFICATIONS OF MEDIATOR. (a) Except
as provided by subsections (b), to qualify for an appointment as a
mediator under this chapter a person must have completed a minimum
of 40 classroom hours of training in dispute resolution techniques
in a course conducted by an alternative dispute resolution system
or other dispute resolution organization approved by the
commissioner.
(b) A person otherwise not qualified as a mediator may be
appointed upon the agreement of the parties.
Section 1456.003. COMPOSITION OF CONSENSUS PANEL; FEES.
(a) A consensus panel shall be comprised of a total of three
mediators as follows:
(1) One mediator appointed by the health plan;
(2) One mediator appointed by the physician or
physician group; and
(3) One mediator, who shall act as chair of the
consensus panel, appointed by the mediators appointed by the health
plan and physician group.
(b) Should the mediators appointed by the parties be unable
to agree on the appointment of the third mediator, the commissioner
shall make a random assignment from a list of qualified mediators
maintained by the department.
(c) All costs of the mediation and mediators shall be paid
by the health plan requesting mandatory mediation.
Sec. 1456.004. NOTICE OF MANDATORY MEDIATION. (a) To
facilitate compliance with Sections 843.114(f) or 1301.005(d), a
health plan may request mandatory mediation, pursuant to this
chapter.
(b) The notice of request for mandatory mediation shall be
provided on a form adopted by the commissioner and shall include the
following:
(1) The name of the health plan requesting mediation;
(2) A brief description of the mediation process;
(3) A statement informing the physician or physician
group at a participating hospital of the health plan's reasons for
requesting mandatory mediation;
(4) Contact information, including a telephone
number, for the person(s) responsible at the health plan for
initiating the mediation; and
(5) Any other information the commissioner may require
by rule.
(c) The notice of request for mandatory mediation shall be
provided to the commissioner and the physician or physician group
in question.
Sec. 1456.005. CONDUCT AT MEDIATION. Mediation shall be
conducted as follows:
(1) Mediation sessions are under the control of the
consensus panel;
(2) Except as provided in Sections 1456.006 and
1456.008, the consensus panel must hold in strict confidence all
information provided by the parties to the mediation as well as the
communications of the parties during the mediation;
(3) All parties must have the opportunity to speak and
state their positions; and
(4) Legal counsel may be present to represent and
advise clients regarding legal rights and the implication of
suggested solutions.
Sec. 1456.006. MEDIATION AGREEMENT. (a) If the parties
involved in mediation reach tentative agreement, the consensus
panel shall provide information for the preparation of a mediation
agreement.
(b) After the consensus panel marshals the information and
the details of the agreement are reviewed and approved by all
agreeing parties, the parties shall agree upon the person who is to
prepare the actual document.
(c) Those parties who do not reach agreement may request
another mediation session, although the request may be declined by
either party.
(1) The request may be made in writing or verbally to
any mediator on the consensus panel and may include a request for
extension of time.
(d) Notwithstanding any other law, if the parties agree that
a mediated solution is not possible or are unable to come to an
agreement, the consensus panel shall report to the commissioner
that the mediation failed to produce an agreement.
Section. 1456.007. Mitigation. A health plan that requests
mandatory mediation as provided by this Chapter and is not reported
for bad faith negotiation, as provided by Section 1456.008, is not
subject to administrative penalties for violation of Texas
Insurance Code Sections 843.114(f)(1) or 1301.005(d).
Section 1456.008. Bad Faith. (a) Bad faith negotiation is:
(1) A failure to attend the mediation;
(2) A failure to provide information the consensus
panel believes is necessary to facilitate an agreement;
(3) A failure to designate a representative present at
the mediation with full authority to enter into any mediated
agreement; or
(4) An insistence on a contract of adhesion in a
mediation.
(b) Failure to reach an agreement is not conclusive proof of
bad faith negotiation.
(c) Notwithstanding any other law, a consensus panel shall
report bad faith negotiation to the commissioner or the Texas
Medical Board, as appropriate, following the conclusion of the
mediation.
(d) Bad faith negotiation is grounds for imposition of an
administrative penalty by the regulatory agency that issued a
license or certificate of authority to the party who committed the
violation.
(e) Upon a report of consensus panel and appropriate proof
of bad faith negotiation, the regulatory agency that issued the
license or certificate of authority shall impose the maximum
administrative penalty the licensing statute provides.
(1) For the purpose of this subsection, in those
circumstances where a physician group is found to have engaged in
bad faith negotiation, an administrative penalty shall be imposed
upon each non-employee member of the physician group. An
independent contractor shall not be considered a member of a
physician group.
Section 1456.009. Rules. The commissioner shall adopt
rules as necessary to implement this chapter.
SECTION 6. The changes in law made by this Act apply only to
a health insurance policy or evidence of coverage issued or renewed
on or after the effective date of this Act. Health insurance
policies or evidences of coverage issued before the effective date
of this Act are governed by the law in effect immediately before the
effective date of this Act, and that law is continued in effect for
that purpose. Provided, however, that all health insurance policies
or evidences of coverage issued in this state shall be governed by
the changes in law made by this Act eighteen months after the
effective date of this Act.
SECTION 7. This Act takes effect September 1, 2005.