By: Duncan S.B. No. 1738
(In the Senate - Filed March 11, 2005; March 30, 2005, read
first time and referred to Committee on State Affairs; May 2, 2005,
reported adversely, with favorable Committee Substitute by the
following vote: Yeas 6, Nays 0; May 2, 2005, sent to printer.)
COMMITTEE SUBSTITUTE FOR S.B. No. 1738 By: Duncan
A BILL TO BE ENTITLED
AN ACT
relating to consumer access to health care information and consumer
protection for services provided by or through hospitals,
ambulatory surgical centers, and birthing centers; providing
penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. SHORT TITLE. This Act may be cited as the
Consumer Right to Know Act.
SECTION 2. Subtitle G, Title 4, Health and Safety Code, is
amended by adding Chapter 322 to read as follows:
CHAPTER 322. CONSUMER ACCESS TO HEALTH CARE INFORMATION
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 322.001. DEFINITIONS. (a) In this chapter:
(1) "Billed charge" means the amount a facility
charges for a health care service or supply.
(2) "Charge master" means a facility's schedule of
billed charges for each health care service, health care supply, or
combination of health care services and supplies.
(3) "Consumer" means any person who is considering
receiving, is receiving, or has received a health care service or
supply as a patient from a facility. The term includes the personal
representative of the patient.
(4) "Department" means the Department of State Health
Services.
(5) "Executive commissioner" means the executive
commissioner of the Health and Human Services Commission.
(6) "Facility" means:
(A) an ambulatory surgical center licensed under
Chapter 243;
(B) a birthing center licensed under Chapter 244;
or
(C) a hospital licensed under Chapter 241.
(7) "Health benefit plan" means a health benefit plan
that provides benefits for medical or surgical expenses incurred as
a result of a health condition, accident, or sickness, including an
individual, group, blanket, or franchise insurance policy or
insurance agreement, a group hospital service contract, or an
individual or group evidence of coverage that is offered by:
(A) an insurance company;
(B) a group hospital service corporation
operating under Chapter 842, Insurance Code;
(C) a fraternal benefit society operating under
Chapter 885, Insurance Code;
(D) a stipulated premium insurance company
operating under Chapter 884, Insurance Code;
(E) a health maintenance organization operating
under Chapter 843, Insurance Code;
(F) to the extent permitted by the Employee
Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et
seq.), a health benefit plan that is offered by:
(i) a multiple employer welfare arrangement
as defined by Section 3, Employee Retirement Income Security Act of
1974 (29 U.S.C. Section 1002); or
(ii) another analogous benefit
arrangement; or
(G) an approved nonprofit health corporation
that is certified under Section 162.001, Occupations Code, and that
holds a certificate of authority issued by the commissioner of
insurance under Chapter 844, Insurance Code.
Sec. 322.002. RULES. The executive commissioner may adopt
and enforce rules to further the purposes of this chapter.
[Sections 322.003-322.050 reserved for expansion]
SUBCHAPTER B. BILLING CHARGES
Sec. 322.051. NOTICE TO CONSUMER. Before any nonemergency
treatment or service is performed, a facility shall provide notice
to a consumer before or on admission to a facility of the consumer's
right to receive:
(1) a free copy of the facility's common procedure
charge list in accordance with Section 322.054;
(2) a notice regarding the availability of the common
procedure charge information on the Consumer Guide to Healthcare
website created under Section 322.055; and
(3) a free written estimate of charges in accordance
with Section 322.056(c).
Sec. 322.052. CHARGE MASTER. (a) A facility may have only
one current charge master.
(b) A charge master must include an initial effective date.
Sec. 322.053. CREATION OF FACILITY COMMON PROCEDURES LIST.
(a) The department shall identify 50 common inpatient procedures
and 50 common outpatient procedures performed for patients by
facilities in this state. A procedure may be a single health care
service or supply or a group of services and supplies commonly
provided as a unit to patients.
(b) A facility shall provide to the department in a format
developed by the department a list of the 50 common inpatient
procedures and 50 common outpatient procedures performed for
patients of the facility in this state. The department shall use the
lists provided by facilities to develop the common procedures list
described in Subsection (a).
(c) The department shall update the common procedures list
at least every two years.
Sec. 322.054. FACILITY COMMON PROCEDURE CHARGE LIST.
(a) A facility shall establish and maintain a list of the average
charge for each procedure identified in the common procedures list
created by the department under Section 322.053 if the procedure is
performed within the facility.
(b) The average charge for each procedure in a facility's
procedure charge list must be based on the charges listed for
individual services and supplies in the facility's current charge
master at the time the list was compiled.
(c) A facility shall have only one current procedure charge
list and shall update the facility's procedure charge list on a
semi-annual basis to reflect any changes made to the facility's
charge master.
(d) A facility shall:
(1) identify each version of the procedure charge list
by the list's initial effective date;
(2) retain a copy of each version until the second
anniversary of each list's effective date;
(3) post on the facility's Internet website, if any, a
copy of the current version of the procedure charge list;
(4) provide notice to a consumer requesting the
procedure charge list that the actual charges for a procedure will
vary based on the person's medical condition and other factors
associated with performance of the procedure; and
(5) provide notice to a consumer requesting the
procedure charge list that the range of charges for a procedure may
differ from the amount to be paid by the consumer or the consumer's
third party payor.
(e) The facility shall:
(1) provide free of charge to a consumer on request a
written copy of any version of the procedure charge list retained
under Subsection (d); and
(2) inform the consumer that the current procedure
charge list is posted on the facility's Internet website, if any,
and provide the consumer with the Internet website address.
Sec. 322.055. CONSUMER GUIDE TO HEALTH CARE. (a) A
facility shall file with the department the procedure charge list
created under Section 322.054.
(b) The department shall make available on the department's
Internet website a consumer guide to health care. The guide must
include the procedure charge list for each facility that submits
the list required under Subsection (a).
(c) The department may accept gifts and grants to fund the
consumer guide to health care.
Sec. 322.056. BILLING OF FACILITY SERVICES. (a) Each
facility shall develop, implement, and enforce written policies for
the billing of hospital services and supplies. The policies must
address:
(1) the provision of the itemized statements required
by Subsection (d);
(2) whether interest will be applied to any billed
service not covered by a third party payor and the rate of any
interest charged;
(3) the providing of a notice concerning the ability
to complain regarding the billed amount in accordance with Sections
322.101 and 311.0025;
(4) the providing of a notice that if a consumer
objects to the bill or treatment, the consumer may file a complaint
with the department and include the name, mailing address, and
telephone number of the department;
(5) the procedure for handling complaints relating to
billed services; and
(6) a disclosure to a consumer requesting services
from the facility that:
(A) provides confirmation whether the facility
is a participating provider under the consumer's third party payor
coverage on the date services are to be rendered; and
(B) informs the consumer that physicians or other
providers who may provide services to the consumer while in the
facility may not be a participating provider with the same third
party payors as the facility.
(b) Each facility shall post in the general waiting area and
in the waiting areas of any off-site or onsite registration,
admission, or business office a clear and conspicuous notice of the
availability of the policies required by Subsection (a).
(c) Before any nonemergency treatment or service is
performed and before a consumer is discharged from a facility, the
facility shall disclose to the consumer the consumer's right to
receive a written estimate of the charges for any procedure,
service, or supply.
(d) Not later than the 30th business day after the date of
the discharge of a consumer who receives facility services, the
facility shall provide to the consumer at the consumer's request an
itemized statement of the billed services. The itemized statement
must:
(1) be printed in a conspicuous manner;
(2) list the date services and supplies were provided;
(3) state whether:
(A) a claim has been submitted to a third party
payor; and
(B) a third party payor has paid the claim;
(4) if payment is not required, state that payment is
not required:
(A) in a typeface that is bold-faced,
capitalized, underlined, or otherwise set out from surrounding
written material; or
(B) by other reasonable means so as to be
conspicuous that payment is not required; and
(5) contain the telephone number of the facility to
call for an explanation of acronyms, abbreviations, and numbers
used to describe the services provided or supplies used or any other
questions regarding the bill.
(e) To be entitled to receive a statement, a consumer must
request the statement not later than one year after the date on
which the person is discharged from the facility. The facility
shall provide the statement to the consumer not later than the 30th
day after the date on which the statement is requested.
(f) A facility shall provide an itemized statement of billed
services to a third party payor that is responsible or is paying all
or part of the billed services provided and who has received a claim
for payment of those services. To be entitled to receive a
statement, the third party payor must request the statement from
the facility and must have received a claim for payment. The
request must be made not later than one year after the date on which
the payor received the claim for payment. The facility shall
provide the statement to the payor not later than the 30th day after
the date on which the payor requests the statement. If a third
party payor receives a claim for payment of part but not all of the
billed services, the third party payor may request an itemized
statement of only the billed services for which payment is claimed
or to which any deduction or copayment applies.
(g) If a consumer or a third party payor requests more than
two copies of the statement, the facility may charge a reasonable
fee for the third and subsequent copies provided. The fee may not
exceed the facility's cost to copy, process, and deliver the copy to
the consumer or third party payor.
(h) If a consumer overpays a facility, the facility must
refund the amount of the overpayment not later than the 30th day
after the date it is determined that an overpayment has been made.
This subsection does not apply to an overpayment covered by Chapter
1301, Insurance Code, or Section 843.350, Insurance Code.
Sec. 322.057. CONSUMER WAIVER PROHIBITED. The provisions
of this subchapter may not be waived, voided, or nullified by a
contract or an agreement between a facility and a consumer.
[Sections 322.058-322.100 reserved for expansion]
SUBCHAPTER C. COMPLAINT RESOLUTION
Sec. 322.101. COMPLAINT PROCESS. (a) A facility shall
have a procedure for handling complaints relating to the charges
for health care services and supplies. If a consumer objects to the
billed amount for a particular service or supply, the facility will
make a good faith effort to resolve the complaint in an informal
manner based on its complaint procedures. If the objection cannot
be resolved informally, the facility shall advise the consumer that
a complaint may be filed with the department and shall provide the
consumer with the mailing address and telephone number of the
department.
(b) If a facility is not a participating provider with a
third party payor, the facility shall have a procedure for handling
complaints by those third party payors relating to the charges for
health care services and supplies. If a third party payor objects to
the billed amount for a particular service or supply pursuant to
this subsection, the facility will make a good faith effort to
resolve any complaints in an informal manner based on its complaint
procedures. If the objection cannot be resolved informally, the
facility shall advise the third party payor that a complaint may be
filed with the department and shall provide the third party payor
with the mailing address and telephone number of the department.
(c) The department shall complete an investigation of a
complaint filed pursuant to this section not later than the 60th day
after the date the department receives the complaint and all
information necessary for the department to make a determination
concerning the validity of the complaint.
(d) The department may extend the time necessary to complete
an investigation if:
(1) additional information is needed;
(2) an on-site review is necessary;
(3) the facility, consumer, or the third party payor
does not provide all documentation necessary to complete the
investigation; or
(4) other circumstances beyond the control of the
department occur.
(e) If the department determines that a complaint regarding
charges for health care services and supplies is valid, the
department may take disciplinary action as provided under
Subchapter D.
[Sections 322.102-322.150 reserved for expansion]
SUBCHAPTER D. ENFORCEMENT AND DISCIPLINARY ACTIONS
Sec. 322.151. AUDIT AND INVESTIGATION. The department may
audit, investigate, or take any other necessary action to
reasonably ensure a facility is complying with Subchapter B or C.
Sec. 322.152. DISCIPLINARY ACTION. (a) A facility that
violates Subchapter B or C is subject to disciplinary action by the
department, as authorized by the applicable licensing law.
(b) Prior to taking any disciplinary action under
Subsection (a), the department shall:
(1) notify a facility that the facility is violating
or has violated this chapter or a rule adopted under this chapter;
and
(2) provide the facility with an opportunity to
correct the violation.
SECTION 3. Subsection (a), Section 843.251, Insurance Code,
is amended to read as follows:
(a) A health maintenance organization shall implement and
maintain a complaint system that provides reasonable procedures to
resolve an oral or written complaint initiated by a complainant
concerning health care services. The complaint system must include
a process for the notice and appeal of a complaint. The health
maintenance organization shall have a procedure for handling
complaints by nonparticipating providers relating to the health
maintenance organization's determination of usual and customary
charges for out-of-network health care services and supplies. If a
nonparticipating provider objects to the health maintenance
organization's determination of usual and customary charges for a
particular service or supply pursuant to this subsection, the
health maintenance organization will make a good faith effort to
resolve the complaint in an informal manner based on its complaint
procedures. If the objection cannot be resolved informally, the
health maintenance organization shall advise the provider that a
complaint may be filed with the department and shall provide the
third party payor with the mailing address and telephone number of
the department.
SECTION 4. Section 1301.055, Insurance Code, is amended by
adding Subsection (c) to read as follows:
(c) An insurer shall have a procedure for handling
complaints by non-participating providers relating to the
insurer's determination of usual and customary charges for
out-of-network health care services and supplies. If a
nonparticipating provider objects to the insurer's determination
of usual and customary charges for a particular service or supply
pursuant to this subsection, the insurer will make a good faith
effort to resolve the complaint in an informal manner based on its
complaint procedures. If the objection cannot be resolved
informally, the insurer shall advise the provider that a complaint
may be filed with the department and shall provide the third party
payor with the mailing address and telephone number of the
department.
SECTION 5. Section 1204.051, Insurance Code, is amended to
read as follows:
Sec. 1204.051. DEFINITIONS. In this subchapter:
(1) "Covered person" means a person who is insured or
covered by a health insurance policy or is a participant in an
employee benefit plan. The term includes:
(A) a person covered by a health insurance policy
because the person is an eligible dependent; and
(B) an eligible dependent of a participant in an
employee benefit plan.
(2) "Employee benefit plan" or "plan" means a plan,
fund, or program established or maintained by an employer, an
employee organization, or both, to the extent that it provides,
through the purchase of insurance or otherwise, health care
services to employees, participants, or the dependents of employees
or participants.
(2-a) "Facility" means a health care facility licensed
to operate in this state as:
(A) an ambulatory surgical center under Chapter
243, Health and Safety Code; or
(B) a hospital under Chapter 241, Health and
Safety Code.
(2-b) "Facility-based physician" includes a
radiologist, an anesthesiologist, a pathologist, or an emergency
department physician:
(A) to whom the facility has granted clinical
privileges; and
(B) who provides services to patients of the
facility under those clinical privileges.
(2-c) "Facility-based physician reasonable and
customary rate" means the average in-network reimbursement amount
paid by an insurer for a service or procedure to a physician
contracted with the insurer. The average in-network reimbursement
amount paid by an insurer for a service or procedure will be
determined by the commissioner, based on annual reports, in
electronic format, filed by the insurer with the department.
Information provided by the insurer under this subdivision is
confidential and is not subject to disclosure under the public
information law, Chapter 552, Government Code.
(3) "Health care provider" means a person who provides
health care services under a license, certificate, registration, or
other similar evidence of regulation issued by this or another
state of the United States.
(4) "Health care service" means a service to diagnose,
prevent, alleviate, cure, or heal a human illness or injury that is
provided to a covered person by a physician or other health care
provider.
(5) "Health insurance policy" means an individual,
group, blanket, or franchise insurance policy, or an insurance
agreement, that provides reimbursement or indemnity for health care
expenses incurred as a result of an accident or sickness.
(6) "Insurer" means an insurance company,
association, or organization authorized to engage in business in
this state under Chapter 841, 861, 881, 882, 883, 884, 885, 886,
887, 888, 941, 942, or 982.
(7) "Person" means an individual, association,
partnership, corporation, or other legal entity.
(8) "Physician" means an individual licensed to
practice medicine in this or another state of the United States.
SECTION 6. Section 2, Article 21.60, Insurance Code, is
amended by adding Subsection (e) to read as follows:
(e) A managed care entity shall submit to the department
upon request after receipt of a complaint a copy of the methodology
and origin of information used to compute usual and customary
reimbursement paid to providers for out-of-network goods and
services. If a specified percentage of charges is used as a basis
for the determination of usual and customary reimbursement the
managed care entity shall provide the percentage used. Information
provided by the health plan under this section is confidential and
is not subject to disclosure under the public information law,
Chapter 552, Government Code.
SECTION 7. Section 1271.001, Insurance Code, is amended to
read as follows:
Sec. 1271.001. [APPLICABILITY OF] DEFINITIONS. (a) In
this chapter:
(1) "Facility" means a health care facility licensed
to operate in this state as:
(A) an ambulatory surgical center under Chapter
243, Health and Safety Code; or
(B) a hospital under Chapter 241, Health and
Safety Code.
(2) "Facility-based physician" includes a
radiologist, an anesthesiologist, a pathologist, or an emergency
department physician:
(A) to whom the facility has granted clinical
privileges; and
(B) who provides services to patients of the
facility under those clinical privileges.
(3) "Facility-based physician reasonable and
customary rate" means the average in-network reimbursement amount
paid by a health maintenance organization for a service or
procedure to a physician contracted with the health maintenance
organization. The average in-network reimbursement amount paid by
a health maintenance organization for a service or procedure will
be determined by the commissioner, based on annual reports, in
electronic format, filed by the health maintenance organization
with the department. Information provided by the health
maintenance organization under this subdivision is confidential
and is not subject to disclosure under the public information law,
Chapter 552, Government Code. This subdivision does not apply to
the Children's Health Insurance Program.
(b) In this chapter, terms defined by Section 843.002 have
the meanings assigned by that section.
SECTION 8. Section 1271.055, Insurance Code, as effective
April 1, 2005, is amended by adding Subsection (d) to read as
follows:
(d) If professional services are provided to an enrollee by
a facility-based physician who is not a member of the health
maintenance organization delivery network, on the health
maintenance organization's payment of the facility-based physician
reasonable and customary rate or at an agreed rate for covered
services, the enrollee is not liable for any further payments to the
facility-based physician except for payment of any applicable
copayments, coinsurance, or deductibles for the covered services.
SECTION 9. Subsection (a), Section 1272.001, Insurance
Code, is amended by adding Subdivisions (4-a) and (4-b) to read as
follows:
(4-a) "Facility" means a health care facility licensed
to operate in this state as:
(A) an ambulatory surgical center under Chapter
243, Health and Safety Code; or
(B) a hospital under Chapter 241, Health and
Safety Code.
(4-b) "Facility-based physician" includes a
radiologist, an anesthesiologist, or an emergency department
physician:
(A) to whom the facility has granted clinical
privileges; and
(B) who provides services to patients of the
facility under those clinical privileges.
SECTION 10. Section 1272.301, Insurance Code, is amended by
adding Subsection (e) to read as follows:
(e) If a limited provider network or delegated entity
provides or arranges to provide services to enrollees through a
facility-based physician who is not a member of the health
maintenance organization delivery network, on payment by the health
maintenance organization of the facility-based physician
reasonable and customary rate or an agreed rate for covered
services, the enrollee is not liable for any further payments to the
facility-based physician except for payment of any applicable
copayments, coinsurance, or deductibles for the covered services.
SECTION 11. (a) Section 1301.001, Insurance Code, is
amended to read as follows:
Sec. 1301.001. DEFINITIONS. In this chapter:
(1) "Facility" means a health care facility licensed
to operate in this state as:
(A) an ambulatory surgical center under Chapter
243 Health and Safety Code; or
(B) a hospital under Chapter 241, Health and
Safety Code.
(2) "Facility-based physician" includes a
radiologist, an anesthesiologist, a pathologist, or an emergency
department physician:
(A) to whom the facility has granted clinical
privileges; and
(B) who provides services to patients of the
facility under those clinical privileges.
(3) "Health care provider" means a practitioner,
institutional provider, or other person or organization that
furnishes health care services and that is licensed or otherwise
authorized to practice in this state. The term does not include a
physician.
(4) [(2)] "Health insurance policy" means a group or
individual insurance policy, certificate, or contract providing
benefits for medical or surgical expenses incurred as a result of an
accident or sickness.
(5) [(3)] "Hospital" means a licensed public or
private institution as defined by Chapter 241, Health and Safety
Code, or Subtitle C, Title 7, Health and Safety Code.
(6) [(4)] "Institutional provider" means a hospital,
nursing home, or other medical or health-related service facility
that provides care for the sick or injured or other care that may be
covered in a health insurance policy.
(7) [(5)] "Insurer" means a life, health, and accident
insurance company, health and accident insurance company, health
insurance company, or other company operating under Chapter
841, 842, 884, 885, 982, or 1501, that is authorized to issue,
deliver, or issue for delivery in this state health insurance
policies.
(8) [(6)] "Physician" means a person licensed to
practice medicine in this state.
(9) [(7)] "Practitioner" means a person who practices
a healing art and is a practitioner described by Section 1451.001 or
1451.101.
(10) "Preauthorization" means a determination by an
insurer that medical care or health care services proposed to be
provided to a patient are medically necessary and appropriate.
(11) [(8)] "Preferred provider" means a physician or
health care provider, or an organization of physicians or health
care providers, who contracts with an insurer to provide medical
care or health care to insureds covered by a health insurance
policy.
(12) [(9)] "Preferred provider benefit plan" means a
benefit plan in which an insurer provides, through its health
insurance policy, for the payment of a level of coverage that is
different from the basic level of coverage provided by the health
insurance policy if the insured person uses a preferred provider.
(13) [(10)] "Service area" means a geographic area or
areas specified in a health insurance policy or preferred provider
contract in which a network of preferred providers is offered and
available.
(14) "Verification" means a reliable representation
by an insurer to a physician or health care provider that the
insurer will pay the physician or provider for proposed medical
care or health care services if the physician or provider renders
those services to the patient for whom the services are proposed.
The term includes precertification, certification,
recertification, and any other term that would be a reliable
representation by an insurer to a physician or provider.
(b) To the extent of any conflict, this section prevails
over another Act of the 79th Legislature, Regular Session, 2005,
relating to nonsubstantive additions and corrections in enacted
codes.
SECTION 12. Subchapter D, Chapter 1301, Insurance Code, is
amended by adding Section 1301.164 to read as follows:
Sec. 1301.164. BALANCE BILLING PROHIBITED. If health care
services are provided to an insured patient in a facility that is
part of the preferred provider network by a facility-based
physician or health care provider who is not a preferred provider,
on payment by the insurer of the facility-based physician or health
care provider reasonable and customary rate or the agreed rate for
covered services, the insured patient is not liable for further
payments to the facility-based physician or health care provider
except for payment of any applicable copayments, coinsurance, or
deductibles owed by the insured for the covered services.
SECTION 13. Subtitle F, Title 8, Insurance Code, is amended
by adding Chapter 1456 to read as follows:
CHAPTER 1456. FACILITY BASED PROVIDER REQUIREMENTS
Sec. 1456.001. DEFINITIONS. In this chapter:
(1) "Balance billing" means the practice of charging
an enrollee of a health benefit plan that uses a provider network to
recover from the enrollee the balance of a non-network health care
provider's fee for services received by the enrollee from the
health care provider that are not fully reimbursed by the
enrollee's health benefit plan.
(2) "Enrollee" means an individual who is eligible to
receive health care services through a health benefit plan.
(3) "Facility-based physician reasonable and
customary rate" means the average in-network reimbursement amount
paid by a health benefit plan for a service or procedure to a
facility-based physician contracted with the health benefit plan.
The average in-network reimbursement amount paid by a health
benefit plan for a service or procedure will be determined by the
commissioner, based on annual reports, in electronic format, filed
by the health benefit plan with the department. Information
provided by the health benefit plan under this subdivision is
confidential and is not subject to disclosure under the public
information law, Chapter 552, Government Code.
(4) "Health care facility" means a hospital, emergency
clinic, outpatient clinic, or other facility providing health care
services.
(5) "Health care practitioner" means an individual who
is licensed to provide and provides health care services.
(6) "Health care provider" means a health care
facility or health care practitioner.
(7) "Provider network" means a health benefit plan
under which health care services are provided to enrollees through
contracts with health care providers and that requires those
enrollees to use health care providers participating in the plan
and procedures covered by the plan. The term includes a network
operated by:
(A) a health maintenance organization;
(B) a preferred provider benefit plan issuer; or
(C) another entity that issues a health benefit
plan, including an insurance company.
Sec. 1456.002. APPLICABILITY OF CHAPTER. (a) This chapter
applies to any health benefit plan that:
(1) provides benefits for medical or surgical expenses
incurred as result of a health condition, accident, or sickness,
including an individual, group, blanket, or franchise insurance
policy or insurance agreement, a group hospital service contract,
or an individual or group evidence of coverage that is offered by:
(A) an insurance company;
(B) a group hospital service corporation
operating under Chapter 842;
(C) a fraternal benefit society operating under
Chapter 885;
(D) a stipulated premium company operating under
Chapter 884;
(E) a health maintenance organization operating
under Chapter 843;
(F) a multiple employer welfare arrangement that
holds a certificate of authority under Chapter 846;
(G) an approved nonprofit health corporation
that holds a certificate of authority under Chapter 844; or
(H) an entity not authorized under this code or
another insurance law of this state that contracts directly for
health care services on a risk-sharing basis, including a
capitation basis; or
(2) provides health and accident coverage through a
risk pool created under Chapter 172, Local Government Code,
notwithstanding Section 172.014, Local Government Code, or any
other law.
(b) This chapter does not apply to the Children's Health
Insurance Program.
Sec. 1456.003. REQUIRED DISCLOSURE: HEALTH BENEFIT PLAN.
(a) Each health benefit plan that provides health care benefits
through a provider network shall provide notice to its enrollees
that:
(1) facility-based physicians may not be included in
the health benefit plan's provider network; and
(2) facility-based physicians described by
Subdivision (1) may not charge or bill the enrollee for amounts
other than applicable copayments, coinsurance, and deductibles if
the health benefit plan pays the facility-based physician
reasonable and customary rate or an agreed rate for covered
services.
(b) The health benefit plan shall provide the disclosure in
writing to each enrollee in any materials sent to the enrollee in
conjunction with issuance of the plan's insurance policy or
evidence of coverage.
(c) If a health benefit plan provides an explanation of
payment summary to an enrollee, it shall include an explanation
that the facility-based physician or provider shall not charge or
bill the enrollee for amounts other than applicable copayments,
coinsurance, and deductibles.
Sec. 1456.004. REQUIRED DISCLOSURE: HEALTH CARE FACILITY.
Each health care facility that has entered into a contract with a
health benefit plan to serve as a provider in the health benefit
plan's provider network shall prominently post a notice to
enrollees receiving health care services at the facility that
states:
(1) facility-based physicians may not be included in
the health benefit plan's provider network; and
(2) facility-based physicians described by
Subdivision (1) may not charge or bill the enrollee for amounts
other than applicable copayments, coinsurance, and deductibles if
the health care plan pays the usual and customary rate as defined by
the insurer or an agreed rate for covered services.
Sec. 1456.005. COMMISSIONER RULES; FORM OF DISCLOSURE. The
commissioner by rule may prescribe specific requirements for the
disclosure required under Sections 1456.003 and 1456.004. The form
of the disclosure must be substantially similar to the following:
NOTICE
ALTHOUGH HEALTH CARE SERVICES MAY BE OR HAVE BEEN PROVIDED TO
YOU AT A HEALTH CARE FACILITY THAT IS A MEMBER OF THE PROVIDER
NETWORK USED BY YOUR HEALTH BENEFIT PLAN, OTHER PROFESSIONAL
SERVICES MAY BE OR HAVE BEEN PROVIDED AT OR THROUGH THE FACILITY BY
HEALTH CARE PROVIDERS WHO ARE NOT MEMBERS OF THAT NETWORK. YOU ARE
NOT RESPONSIBLE FOR PAYMENT TO THE NON-NETWORK PHYSICIANS OF
AMOUNTS OTHER THAN APPLICABLE COPAYMENTS, COINSURANCE AND
DEDUCTIBLES IF YOUR HEALTH BENEFIT PLAN PAYS THE FACILITY-BASED
PHYSICIAN REASONABLE AND CUSTOMARY RATE OR AN AGREED AMOUNT FOR
COVERED SERVICES.
Sec. 1456.006. COMPLAINTS PROCESS CONCERNING FACILITY-BASED
PHYSICIANS. (a) A health benefit plan shall have a procedure for
handling complaints relating to the charges for health care
services and supplies. If a facility-based physician or health
care provider objects to the facility-based physician or health
care provider reasonable and customary rate for a particular
service or supply, the health benefit plan will make a good faith
effort to resolve the complaint in an informal manner based on its
complaint procedures. If the objection cannot be resolved
informally, the health benefit plan shall advise the consumer that
a complaint may be filed with the department and shall provide the
consumer with the mailing address and telephone number of the
department.
(b) The department shall complete an investigation of a
complaint filed pursuant to this section not later than the 60th day
after the date the department receives the complaint and all
information necessary for the department to make a determination
concerning the validity of the complaint.
(c) The department may extend the time necessary to complete
an investigation if:
(1) additional information is needed;
(2) an on-site review is necessary;
(3) the facility, consumer, or the third party payor
does not provide all documentation necessary to complete the
investigation; or
(4) other circumstances beyond the control of the
department occur.
SECTION 14. Subchapter I, Chapter 843, Insurance Code, is
amended by adding Section 843.321 to read as follows:
Sec. 843.321. STUDY OF NETWORK ADEQUACY AND CONTRACTS OF
HEALTH PLANS. (a) In this section:
(1) "Commissioner" means the commissioner of
insurance.
(2) "Health plan" means an insurance policy or a
contract or evidence of coverage issued by a health maintenance
organization or an employer or employee sponsored health plan.
(b) The commissioner shall appoint an advisory committee to
study facility-based provider network adequacy of health plans and
the health plans' ability to contract on reasonable terms with
facility-based physicians.
(c) The advisory committee shall advise the commissioner
periodically of its findings, no later than December, 2006.
(d) The advisory committee shall be composed of:
(1) at least one person affiliated with an insurance
company, licensed to write health insurance in this state;
(2) at least one person affiliated with a health
maintenance organization licensed to offer health coverage in this
state;
(3) at least one physician licensed to practice by the
Texas State Board of Medical Examiners;
(4) at least one person affiliated with a hospital
licensed in this state; and
(5) at least one member of the general public who is
not employed by or affiliated with an insurance company, health
maintenance organization, physician, or hospital. A
representative of the general public includes a person whose only
affiliation with an insurance company or health maintenance
organization is as an insured or covered person.
(e) Members of the committee serve without compensation.
SECTION 15. Section 105.001, Occupations Code, is amended
to read as follows:
Sec. 105.001. DEFINITIONS [DEFINITION]. In this chapter:
(1) "Consumer" means any person who is considering
receiving, is receiving, or has received a health care service or
supply as a patient from a facility. The term includes the personal
representative of the patient.
(2) "Facility-based physician" means a physician
licensed to practice medicine in this state who is a radiologist,
anesthesiologist, pathologist, or emergency room physician.
(3) "Health[, "health] care provider" means a person
who furnishes services under a license, certificate, registration,
or other authority issued by this state or another state to
diagnose, prevent, alleviate, or cure a human illness or injury.
(4) "Licensing authority" means a department,
commission, board, office, or other agency of this state that
issues a license, certificate, registration, or other authority to
regulate under this code the professional practice of a health care
provider.
SECTION 16. Section 105.002, Occupations Code, is amended
to read as follows:
Sec. 105.002. UNPROFESSIONAL CONDUCT. (a) A health care
provider commits unprofessional conduct if the health care
provider, in connection with the provider's professional
activities or provision of professional services:
(1) knowingly presents or causes to be presented a
false or fraudulent claim for the payment of a loss under an
insurance policy; or
(2) knowingly prepares, makes, or subscribes to any
writing, with intent to present or use the writing, or to allow it
to be presented or used, in support of a false or fraudulent claim
under an insurance policy.
(b) A facility-based physician commits unprofessional
conduct if the facility-based physician, in connection with
professional activities, bills a patient for any amount above the
applicable copayment, coinsurance, or deductible for covered
services if the facility-based physician is paid the facility-based
physician reasonable and customary rate or an agreed rate of
payment from the health maintenance organization, preferred
provider organization, or insurer for health care services.
(c) The provisions of Subsection (b) may not be waived,
voided, or nullified, in whole or in part, by a contract or an
agreement between a health care provider and consumer.
(d) In addition to other provisions of civil or criminal
law, commission of unprofessional conduct under Subsections
[Subsection] (a) and (b) constitutes cause for:
(1) the revocation or suspension by the appropriate
licensing authority of a provider's license, permit, registration,
certificate, or other authority;
(2) imposition by the appropriate licensing authority
of an administrative penalty in an amount not to exceed $500 for
each day of violation; or
(3) other appropriate disciplinary action.
SECTION 17. Section 311.002, Health and Safety Code, is
repealed.
SECTION 18. This Act applies to an insurance policy,
certificate, or contract or an evidence of coverage delivered,
issued for delivery, or renewed on or after the effective date of
this Act. A policy, certificate, or contract or evidence of
coverage delivered, issued for delivery, or renewed before the
effective date of this Act is governed by the law as it existed
immediately before the effective date of this Act, and that law is
continued in effect for that purpose.
SECTION 19. (a) Section 105.002, Occupations Code, as
amended by this Act, applies only to conduct occurring on or after
the effective date of this Act.
(b) Conduct occurring before the effective date of this Act
is governed by the law in effect on the date that the conduct
occurred, and the former law is continued in effect for that
purpose.
SECTION 20. (a) The executive commissioner of the Health
and Human Services Commission and appropriate regulatory agencies
shall adopt rules necessary to implement Chapter 322, Health and
Safety Code, as added by this Act, not later than May 1, 2006.
(b) The Department of State Health Services shall develop
the common procedures lists and the consumer guide to health care as
required by Chapter 322, Health and Safety Code, as added by this
Act, not later than September 1, 2006.
SECTION 21. Notwithstanding Subchapter D, Chapter 322,
Health and Safety Code, as added by this Act, a hospital, ambulatory
surgical center, birthing center, or health care provider is not
subject to disciplinary action, a civil penalty, an administrative
penalty, or a civil action for damages for conduct that violates
Chapter 322 or a rule adopted under that chapter before January 1,
2006.
SECTION 22. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2005.
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