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A BILL TO BE ENTITLED
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AN ACT
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relating to disclosures of preauthorization requirements and |
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explanations of benefits for medical and health care services and |
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supplies covered by health maintenance organizations and preferred |
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provider benefit plans; imposing administrative penalties. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter D, Chapter 843, Insurance Code, is |
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amended by adding Section 843.114 to read as follows: |
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Sec. 843.114. EXPLANATION OF BENEFITS. A health |
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maintenance organization shall provide a written explanation of |
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benefits to an enrollee for a health care service or supply |
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submitted by a physician or health care provider to the health |
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maintenance organization for payment. The explanation must |
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include: |
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(1) a plain-language description of the health care |
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service or supply that adequately identifies for the enrollee the |
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health care service or supply received by the enrollee from the |
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physician or provider; and |
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(2) a plain-language description of each identifying |
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code, including a denial code, provided in the explanation of |
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benefits that adequately informs and defines the identifying code |
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for the enrollee. |
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SECTION 2. Section 843.3481, Insurance Code, is amended by |
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amending Subsections (a) and (b) and adding Subsection (e) to read |
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as follows: |
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(a) A health maintenance organization that uses a |
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preauthorization process for health care services shall display in |
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a prominent location on or through a dedicated link that is |
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prominently displayed on the home page of the health maintenance |
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organization's Internet website all [make the] requirements and |
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information about the preauthorization process [readily accessible |
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to enrollees, physicians, providers, and the general public by |
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posting the requirements and information on the health maintenance |
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organization's Internet website]. |
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(b) The preauthorization requirements and information |
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described by Subsection (a) [must]: |
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(1) must be [posted]: |
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(A) available free of charge; |
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(B) formatted in a manner that is digitally |
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searchable and prescribed by the commissioner; |
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(C) accessible to a common commercial operator of |
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an Internet search engine as reasonably necessary for the search |
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engine to: |
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(i) index the requirements and information; |
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and |
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(ii) display the requirements and |
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information as a result in a response to a search query initiated by |
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a user of the search engine; and |
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(D) [(A) except as provided by Subsection (c) or |
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(d), conspicuously in a location on the Internet website that does |
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not require the use of a log-in or other input of personal |
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information to view the information; and |
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[(B) in a format that is easily searchable and |
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accessible; |
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[(2) except for the screening criteria under |
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Subdivision (4)(C), be] written in plain language that is easily |
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understandable by enrollees, physicians, providers, and the |
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general public; |
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(2) may not require an individual to: |
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(A) establish a user account or password; |
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(B) submit personal identifying information; or |
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(C) overcome any other impediment to accessing |
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the requirements and information, including a requirement that the |
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individual enter a code to access the requirements and information; |
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(3) must include a detailed description of the |
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preauthorization process and procedure; and |
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(4) must include an accurate and current list of the |
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health care services for which the health maintenance organization |
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requires preauthorization that includes the following information |
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specific to each service: |
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(A) the effective date of the preauthorization |
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requirement; |
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(B) a list or description of any supporting |
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documentation that the health maintenance organization requires |
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from the physician or provider ordering or requesting the service |
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to approve a request for that service; |
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(C) the applicable screening criteria, which may |
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include Current Procedural Terminology codes and International |
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Classification of Diseases codes; and |
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(D) statistics regarding preauthorization |
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approval and denial rates for the service in the preceding calendar |
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year, including statistics in the following categories: |
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(i) physician or provider type and |
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|
specialty, if any; |
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(ii) indication offered; |
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(iii) reasons for request denial, which may |
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not be in the form of alphanumeric codes; |
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(iv) initial denials; |
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(v) denials overturned on internal appeal; |
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(vi) [(v)] denials overturned by an |
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independent review organization; |
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(vii) approvals and denials of expedited |
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preauthorization requests; |
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(viii) [and |
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[(vi)] total annual preauthorization |
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requests, approvals, and denials for the service; and |
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(ix) average and median times that elapsed |
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between the submission of a preauthorization request and a decision |
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by the health maintenance organization, sorted by standard |
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preauthorization requests and expedited preauthorization requests. |
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(e) The provisions of this section may not be waived by |
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contract. |
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SECTION 3. Section 843.3482, Insurance Code, is amended to |
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read as follows: |
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Sec. 843.3482. CHANGES TO PREAUTHORIZATION REQUIREMENTS. |
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(a) Except as provided by Subsection (b), not later than the 60th |
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business day before the date a new or amended preauthorization |
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requirement takes effect, a health maintenance organization that |
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uses a preauthorization process for health care services shall, in |
|
|
accordance with Section 843.3481: |
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|
(1) provide written notice of the new or amended |
|
|
preauthorization requirement and the date and time the requirement |
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|
goes into effect to each enrollee and each participating physician |
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|
and provider in the health maintenance organization's network who |
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|
provides a health care service subject to the requirement; and |
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(2) disclose the new or amended requirement and the |
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|
date and time the requirement goes into effect in the health |
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|
maintenance organization's newsletter or network bulletin, if any, |
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and on the health maintenance organization's Internet website. |
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(b) For a change in a preauthorization requirement or |
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process that removes a service from the list of health care services |
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requiring preauthorization or amends a preauthorization |
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requirement in a way that is less burdensome to enrollees or |
|
|
participating physicians or providers, a health maintenance |
|
|
organization shall, in accordance with Section 843.3481: |
|
|
(1) provide written notice of the change in the |
|
|
preauthorization requirement and the date and time the change goes |
|
|
into effect to each enrollee and each participating physician and |
|
|
provider in the health maintenance organization's network who |
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|
provides the health care service; and |
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(2) disclose the change and the date and time the |
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|
change goes into effect in the health maintenance organization's |
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|
newsletter or network bulletin, if any, and on the health |
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|
maintenance organization's Internet website [not later than the |
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|
fifth day before the date the change takes effect]. |
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(c) Not later than the fifth day before the date a new or |
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amended preauthorization requirement takes effect, a health |
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maintenance organization shall update its Internet website to |
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|
disclose the change to the health maintenance organization's |
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preauthorization requirements or process and the date and time the |
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|
change is effective in accordance with Section 843.3481. |
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(d) A new or amended preauthorization requirement imposed |
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by a health maintenance organization must take effect on a business |
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day. |
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(e) The provisions of this section may not be waived by |
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contract. |
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SECTION 4. Subchapter J, Chapter 843, Insurance Code, is |
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amended by adding Section 843.3484 to read as follows: |
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Sec. 843.3484. ADDITIONAL ENFORCEMENT FOR PREAUTHORIZATION |
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VIOLATION. (a) In addition to any other penalty or remedy provided |
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by law and if the commissioner determines that a health maintenance |
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organization has violated Section 843.348, 843.3481, or 843.3482, |
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the commissioner shall issue a notice of the violation to the health |
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maintenance organization and order the health maintenance |
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organization to submit a corrective action plan to the department. |
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The notice must: |
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(1) indicate the form and manner in which the |
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corrective action plan must be submitted to the department; and |
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(2) clearly state the date by which the health |
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|
maintenance organization must submit the plan. |
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(b) A health maintenance organization that receives a |
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notice under Subsection (a) shall, on or before the date described |
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by Subsection (a)(2): |
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(1) submit a corrective action plan in the form and |
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|
manner prescribed by the notice; and |
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(2) as soon as practicable after submission of a |
|
|
corrective action plan under Subdivision (1), act to comply with |
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|
the plan. |
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(c) A corrective action plan submitted to the department |
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|
must provide: |
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(1) a detailed description of the corrective action |
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|
the health maintenance organization will take to address each |
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|
violation identified by the commissioner and included in the notice |
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provided under Subsection (a); and |
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(2) a date by which the health maintenance |
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organization will complete the corrective action described by |
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Subdivision (1). |
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(d) In addition to any other penalty or remedy provided by |
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|
law, the commissioner shall impose an administrative penalty under |
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Chapter 84 on a health maintenance organization for each violation |
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|
of this section or Section 843.348, 843.3481, or 843.3482 by the |
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health maintenance organization. For purposes of determining a |
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penalty under Subsection (e), each day a violation continues is |
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considered a separate violation. |
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(e) The commissioner shall set the amount of the |
|
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administrative penalty described by Subsection (d) in an amount not |
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to exceed: |
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(1) for a health maintenance organization with a total |
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|
gross revenue of less than $10 million during the preceding |
|
|
calendar year, $10 for each violation; |
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(2) for a health maintenance organization with a total |
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gross revenue of $10 million or more but less than $100 million |
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during the preceding calendar year, $100 for each violation; or |
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(3) for a health maintenance organization with a total |
|
|
gross revenue of $100 million or more during the preceding calendar |
|
|
year, $1,000 for each violation. |
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SECTION 5. Subchapter A, Chapter 1301, Insurance Code, is |
|
|
amended by adding Section 1301.011 to read as follows: |
|
|
Sec. 1301.011. EXPLANATION OF BENEFITS. An insurer shall |
|
|
provide a written explanation of benefits to an insured for a health |
|
|
care service or supply submitted by a physician or health care |
|
|
provider to the insurer for payment. The explanation must include: |
|
|
(1) a plain-language description of the health care |
|
|
service or supply that adequately identifies for the insured the |
|
|
health care service or supply received by the insured from the |
|
|
physician or provider; and |
|
|
(2) a plain-language description of each identifying |
|
|
code, including a denial code, provided in the explanation of |
|
|
benefits that adequately informs and defines the identifying code |
|
|
for the insured. |
|
|
SECTION 6. Sections 1301.1351(a) and (b), Insurance Code, |
|
|
are amended to read as follows: |
|
|
(a) An insurer that uses a preauthorization process for |
|
|
medical care or health care services shall display in a prominent |
|
|
location on or through a dedicated link that is prominently |
|
|
displayed on the home page of the insurer's Internet website all |
|
|
[make the] requirements and information about the preauthorization |
|
|
process [readily accessible to insureds, physicians, health care |
|
|
providers, and the general public by posting the requirements and |
|
|
information on the insurer's Internet website]. |
|
|
(b) The preauthorization requirements and information |
|
|
described by Subsection (a) [must]: |
|
|
(1) must be [posted]: |
|
|
(A) available free of charge; |
|
|
(B) formatted in a manner that is digitally |
|
|
searchable and prescribed by the commissioner; |
|
|
(C) accessible to a common commercial operator of |
|
|
an Internet search engine as reasonably necessary for the search |
|
|
engine to: |
|
|
(i) index the requirements and information; |
|
|
and |
|
|
(ii) display the requirements and |
|
|
information as a result in response to a search query initiated by a |
|
|
user of the search engine; and |
|
|
(D) [(A) except as provided by Subsection (c) or |
|
|
(d), conspicuously in a location on the Internet website that does |
|
|
not require the use of a log-in or other input of personal |
|
|
information to view the information; and |
|
|
[(B) in a format that is easily searchable and |
|
|
accessible; |
|
|
[(2) except for the screening criteria under |
|
|
Subdivision (4)(C), be] written in plain language that is easily |
|
|
understandable by insureds, physicians, health care providers, and |
|
|
the general public; |
|
|
(2) may not require an individual to: |
|
|
(A) establish a user account or password; |
|
|
(B) submit personal identifying information; or |
|
|
(C) overcome any other impediment to accessing |
|
|
the requirements and information, including a requirement that the |
|
|
individual enter a code to access the requirements and information; |
|
|
(3) must include a detailed description of the |
|
|
preauthorization process and procedure; and |
|
|
(4) must include an accurate and current list of |
|
|
medical care and health care services for which the insurer |
|
|
requires preauthorization that includes the following information |
|
|
specific to each service: |
|
|
(A) the effective date of the preauthorization |
|
|
requirement; |
|
|
(B) a list or description of any supporting |
|
|
documentation that the insurer requires from the physician or |
|
|
health care provider ordering or requesting the service to approve |
|
|
a request for the service; |
|
|
(C) the applicable screening criteria, which may |
|
|
include Current Procedural Terminology codes and International |
|
|
Classification of Diseases codes; and |
|
|
(D) statistics regarding the insurer's |
|
|
preauthorization approval and denial rates for the medical care or |
|
|
health care service in the preceding calendar year, including |
|
|
statistics in the following categories: |
|
|
(i) physician or health care provider type |
|
|
and specialty, if any; |
|
|
(ii) indication offered; |
|
|
(iii) reasons for request denial, which may |
|
|
not be in the form of alphanumeric codes; |
|
|
(iv) initial denials; |
|
|
(v) denials overturned on internal appeal; |
|
|
(vi) [(v)] denials overturned by an |
|
|
independent review organization; |
|
|
(vii) approvals and denials of expedited |
|
|
preauthorization requests; |
|
|
(viii) [and |
|
|
[(vi)] total annual preauthorization |
|
|
requests, approvals, and denials for the service; and |
|
|
(ix) average and median times that elapsed |
|
|
between the submission of a preauthorization request and a decision |
|
|
by the insurer, sorted by standard preauthorization requests and |
|
|
expedited preauthorization requests. |
|
|
SECTION 7. Section 1301.1352, Insurance Code, is amended by |
|
|
amending Subsections (a), (b), and (c) and adding Subsection (c-1) |
|
|
to read as follows: |
|
|
(a) Except as provided by Subsection (b), not later than the |
|
|
60th business day before the date a new or amended preauthorization |
|
|
requirement takes effect, an insurer that uses a preauthorization |
|
|
process for medical care or health care services shall, in |
|
|
accordance with Section 1301.1351: |
|
|
(1) provide written notice of the new or amended |
|
|
preauthorization requirement and the date and time the requirement |
|
|
goes into effect to each insured and each participating provider in |
|
|
the insurer's network who provides the medical care or health care |
|
|
service subject to the requirement; and |
|
|
(2) disclose the new or amended requirement and the |
|
|
date and time the requirement goes into effect in the insurer's |
|
|
newsletter or network bulletin, if any, and on the insurer's |
|
|
Internet website. |
|
|
(b) For a change in a preauthorization requirement or |
|
|
process that removes a service from the list of medical care or |
|
|
health care services requiring preauthorization or amends a |
|
|
preauthorization requirement in a way that is less burdensome to |
|
|
insureds, physicians, or health care providers, an insurer shall, |
|
|
in accordance with Section 1301.1351: |
|
|
(1) provide written notice of the change in the |
|
|
preauthorization requirement and the date and time the change goes |
|
|
into effect to each insured, participating physician, and health |
|
|
care provider in the insurer's network who provides the medical |
|
|
care or health care service; and |
|
|
(2) disclose the change and the date and time the |
|
|
change goes into effect in the insurer's newsletter or network |
|
|
bulletin, if any, and on the insurer's Internet website [not later |
|
|
than the fifth day before the date the change takes effect]. |
|
|
(c) Not later than the fifth day before the date a new or |
|
|
amended preauthorization requirement takes effect, an insurer |
|
|
shall update its Internet website to disclose the change to the |
|
|
insurer's preauthorization requirements or process and the date and |
|
|
time the change is effective in accordance with Section 1301.1351. |
|
|
(c-1) A new or amended preauthorization requirement imposed |
|
|
by an insurer must take effect on a business day. |
|
|
SECTION 8. Subchapter C-1, Chapter 1301, Insurance Code, is |
|
|
amended by adding Section 1301.1354 to read as follows: |
|
|
Sec. 1301.1354. ADDITIONAL ENFORCEMENT FOR |
|
|
PREAUTHORIZATION VIOLATION. (a) In addition to any other penalty |
|
|
or remedy provided by law and if the commissioner determines that an |
|
|
insurer has violated Section 1301.135, 1301.1351, or 1301.1352, the |
|
|
commissioner shall issue a notice of the violation to the insurer |
|
|
and order the insurer to submit a corrective action plan to the |
|
|
department. The notice must: |
|
|
(1) indicate the form and manner in which the |
|
|
corrective action plan must be submitted to the department; and |
|
|
(2) clearly state the date by which the insurer must |
|
|
submit the plan. |
|
|
(b) An insurer that receives a notice under Subsection (a) |
|
|
shall, on or before the date described by Subsection (a)(2): |
|
|
(1) submit a corrective action plan in the form and |
|
|
manner prescribed by the notice; and |
|
|
(2) as soon as practicable after submission of a |
|
|
corrective action plan under Subdivision (1), act to comply with |
|
|
the plan. |
|
|
(c) A corrective action plan submitted to the department |
|
|
must provide: |
|
|
(1) a detailed description of the corrective action |
|
|
the insurer will take to address each violation identified by the |
|
|
commissioner and included in the notice provided under Subsection |
|
|
(a); and |
|
|
(2) a date by which the insurer will complete the |
|
|
corrective action described by Subdivision (1). |
|
|
(d) In addition to any other penalty or remedy provided by |
|
|
law, the commissioner shall impose an administrative penalty under |
|
|
Chapter 84 on an insurer for each violation of this section or |
|
|
Section 1301.135, 1301.1351, or 1301.1352. For purposes of |
|
|
determining a penalty under Subsection (e), each day a violation |
|
|
continues is considered a separate violation. |
|
|
(e) The commissioner shall set the amount of an |
|
|
administrative penalty described by Subsection (d) in an amount not |
|
|
to exceed: |
|
|
(1) for an insurer with a total gross revenue of less |
|
|
than $10 million during the preceding calendar year, $10 for each |
|
|
violation; |
|
|
(2) for an insurer with a total gross revenue of $10 |
|
|
million or more but less than $100 million during the preceding |
|
|
calendar year, $100 for each violation; or |
|
|
(3) for an insurer with a total gross revenue of $100 |
|
|
million or more during the preceding calendar year, $1,000 for each |
|
|
violation. |
|
|
SECTION 9. The following provisions of the Insurance Code |
|
|
are repealed: |
|
|
(1) Sections 843.3481(c) and (d); |
|
|
(2) Section 843.3483; |
|
|
(3) Sections 1301.1351(c) and (d); and |
|
|
(4) Section 1301.1353. |
|
|
SECTION 10. Sections 843.114 and 1301.011, Insurance Code, |
|
|
as added by this Act, apply only to a health benefit plan delivered, |
|
|
issued for delivery, or renewed on or after January 1, 2026. |
|
|
SECTION 11. A health maintenance organization and insurer |
|
|
shall update the health maintenance organization's or insurer's |
|
|
Internet website to conform with Section 843.3481 or 1301.1351, |
|
|
Insurance Code, as amended by this Act, as applicable, not later |
|
|
than January 1, 2026. |
|
|
SECTION 12. Sections 843.3481, 843.3482, 1301.1351, and |
|
|
1301.1352, Insurance Code, as amended by this Act, and Sections |
|
|
843.3484 and 1301.1354, Insurance Code, as added by this Act, apply |
|
|
only to a request for preauthorization of medical care or health |
|
|
care services made on or after January 1, 2026, under a health |
|
|
benefit plan delivered, issued for delivery, or renewed on or after |
|
|
that date. A request for preauthorization of medical care or health |
|
|
care services made before January 1, 2026, or on or after January 1, |
|
|
2026, under a health benefit plan delivered, issued for delivery, |
|
|
or renewed before that date 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 13. This Act takes effect September 1, 2025. |