Bill Text: TX HB3017 | 2011-2012 | 82nd Legislature | Enrolled


Bill Title: Relating to the prohibited use of discretionary clauses in certain health maintenance organization and insurance contracts.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Passed) 2011-06-17 - Effective immediately [HB3017 Detail]

Download: Texas-2011-HB3017-Enrolled.html
 
 
  H.B. No. 3017
 
 
 
 
AN ACT
  relating to the prohibited use of discretionary clauses in certain
  health maintenance organization and insurance contracts.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter B, Chapter 1271, Insurance Code, is
  amended by adding Section 1271.057 to read as follows:
         Sec. 1271.057.  DISCRETIONARY CLAUSES PROHIBITED. (a) An
  evidence of coverage may not contain a discretionary clause
  provision.
         (b)  A discretionary clause provision includes a provision
  that:
               (1)  purports or acts to bind the enrollee to, or grant
  deference in subsequent proceedings to, adverse eligibility or
  benefit decisions or interpretations of the evidence of coverage by
  the health maintenance organization; or
               (2)  specifies:
                     (A)  that an enrollee or other claimant may not
  contest or appeal a denial of a benefit;
                     (B)  that the health maintenance organization's
  interpretation of the terms of an evidence of coverage or other form
  or its decision to deny coverage or the amount of benefits is
  binding on an enrollee or other claimant;
                     (C)  that in an appeal, the health maintenance
  organization's decision-making power as to the interpretation of
  the terms of an evidence of coverage or other form, or as to
  coverage, is binding; or
                     (D)  a standard of review in any appeal process
  that gives deference to the original benefit decision or provides
  standards of interpretation or review that are inconsistent with
  the laws of this state, including the common law.
         SECTION 2.  Subchapter B, Chapter 1701, Insurance Code, is
  amended by adding Section 1701.062 to read as follows:
         Sec. 1701.062.  DISCRETIONARY CLAUSES PROHIBITED. (a) An
  insurer may not use a document described by Section 1701.002 in this
  state if the document contains a discretionary clause.
         (b)  A discretionary clause includes a provision that:
               (1)  purports or acts to bind the claimant to, or grant
  deference in subsequent proceedings to, adverse eligibility or
  claim decisions or policy interpretations by the insurer; or
               (2)  specifies:
                     (A)  that a policyholder or other claimant may not
  contest or appeal a denial of a claim;
                     (B)  that the insurer's interpretation of the
  terms of a document or decision to deny coverage or the amount of
  benefits is binding upon a policyholder or other claimant;
                     (C)  that in an appeal, the insurer's decision
  about or interpretation of the terms of a document or coverage is
  binding; or
                     (D)  a standard of review in any appeal process
  that gives deference to the original claim decision or provides
  standards of interpretation or review that are inconsistent with
  the laws of this state, including the common law.
         SECTION 3.  The change in law made by this Act applies only
  to a document or evidence of coverage that is delivered, issued for
  delivery, or renewed on or after January 1, 2012. A document or
  evidence of coverage that is delivered, issued for delivery, or
  renewed before January 1, 2012, is governed by the law in effect
  immediately before the effective date of this Act, and that law is
  continued in effect for that purpose.
         SECTION 4.  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, 2011.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 3017 was passed by the House on May
  10, 2011, by the following vote:  Yeas 144, Nays 0, 2 present, not
  voting.
 
  ______________________________
  Chief Clerk of the House   
 
 
         I certify that H.B. No. 3017 was passed by the Senate on May
  24, 2011, by the following vote:  Yeas 31, Nays 0
  .
 
  ______________________________
  Secretary of the Senate    
  APPROVED:  _____________________
                     Date          
   
            _____________________
                   Governor       
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