Bill Text: TX HB528 | 2011-2012 | 82nd Legislature | Enrolled

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Bill Title: Relating to the provision of pharmaceutical services through informal and voluntary networks in the workers' compensation system; providing an administrative violation.

Sponsorship: Bipartisan Bill

Status: (Passed) 2011-06-17 - Effective immediately [HB528 Detail]

Download: Texas-2011-HB528-Enrolled.html

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H.B. No. 528

AN ACT
relating to the provision of pharmaceutical services through
informal and voluntary networks in the workers' compensation
system; providing an administrative violation.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 408.027(f), Labor Code, is amended to
read as follows:
(f) Except as provided by Section 408.0281, any [Any]
payment made by an insurance carrier under this section shall be in
accordance with the fee guidelines authorized under this subtitle
if the health care service is not provided through a workers'
compensation health care network under Chapter 1305, Insurance
Code, or at a contracted rate for that health care service if the
health care service is provided through a workers' compensation
health care network under Chapter 1305, Insurance Code.
SECTION 2. Sections 408.028(f) and (g), Labor Code, are
amended to read as follows:
(f) Notwithstanding any other provision of this title, the
commissioner by rule shall adopt a fee schedule for pharmacy and
pharmaceutical services that will:
(1) provide reimbursement rates that are fair and
reasonable;
(2) assure adequate access to medications and services
for injured workers; [and]
(3) minimize costs to employees and insurance
carriers; and
(4) take into consideration the increased security of
payment afforded by this subtitle.
(g) Section 413.011(d) and the rules adopted to implement
that subsection do not apply to the fee schedule adopted by the
commissioner under Subsection (f). [Insurance carriers must
reimburse for pharmacy benefits and services using the fee schedule
as developed by this section, or at rates negotiated by contract.]
SECTION 3. Subchapter B, Chapter 408, Labor Code, is
amended by adding Sections 408.0281 and 408.0282 to read as
follows:
Sec. 408.0281. REIMBURSEMENT FOR PHARMACEUTICAL SERVICES;
ADMINISTRATIVE VIOLATION. (a) In this section:
(1) "Informal network" means a network that:
(A) is established under a contract between an
insurance carrier or an insurance carrier's authorized agent and a
health care provider for the provision of pharmaceutical services;
and
(B) includes a specific fee schedule.
(2) "Voluntary network" means a voluntary workers'
compensation health care delivery network established under former
Section 408.0223, as that section existed before repeal by Chapter
265 (H.B. 7), Acts of the 79th Legislature, Regular Session, 2005,
by an insurance carrier for the provision of pharmaceutical
services.
(b) Notwithstanding any provision of Chapter 1305,
Insurance Code, or Section 504.053 of this code, prescription
medication or services, as defined by Section 401.011(19)(E):
(1) may be reimbursed in accordance with the fee
guidelines adopted by the commissioner or at a contract rate in
accordance with this section; and
(2) may not be delivered through:
(A) a workers' compensation health care network
under Chapter 1305, Insurance Code; or
(B) a contract described by Section
504.053(b)(2).
(c) Notwithstanding any other provision of this title,
including Section 408.028(f), or any provision of Chapter 1305,
Insurance Code, an insurance carrier may pay a health care provider
fees for pharmaceutical services that are inconsistent with the fee
guidelines adopted by the commissioner only if the carrier has a
contract with the health care provider and that contract includes a
specific fee schedule. An insurance carrier or the carrier's
authorized agent may use an informal or voluntary network to obtain
a contractual agreement that provides for fees different from the
fees authorized under the fee guidelines adopted by the
commissioner for pharmaceutical services. If a carrier or the
carrier's authorized agent chooses to use an informal or voluntary
network to obtain a contractual fee arrangement, there must be a
contractual arrangement between:
(1) the carrier or authorized agent and the informal
or voluntary network that authorizes the network to contract with
health care providers for pharmaceutical services on the carrier's
behalf; and
(2) the informal or voluntary network and the health
care provider that includes a specific fee schedule and complies
with the notice requirements of this section.
(d) An informal or voluntary network, or the carrier or the
carrier's authorized agent, as appropriate, shall, at least
quarterly, notify each health care provider of any person, other
than an injured employee, to which the network's contractual fee
arrangements with the health care provider are sold, leased,
transferred, or conveyed. Notice to each health care provider:
(1) must include:
(A) the contact information for the network,
including the name, physical address, and toll-free telephone
number at which a health care provider with which the network has a
contract may contact the network; and
(B) in the body of the notice:
(i) the name, physical address, and
telephone number of any person, other than an injured employee, to
which the network's contractual fee arrangement with the health
care provider is sold, leased, transferred, or conveyed; and
(ii) the start date and any end date of the
period during which any person, other than an injured employee, to
which the network's contractual fee arrangement with the health
care provider is sold, leased, transferred, or conveyed; and
(2) may be provided:
(A) in an electronic format, if a paper version
is available on request by the division; and
(B) through an Internet website link, but only if
the website:
(i) contains the information described by
Subdivision (1); and
(ii) is updated at least monthly with
current and correct information.
(e) An informal or voluntary network, or the carrier or the
carrier's authorized agent, as appropriate, shall document the
delivery of the notice required under Subsection (d), including the
method of delivery, to whom the notice was delivered, and the date
of delivery. For purposes of Subsection (d), a notice is considered
to be delivered on, as applicable:
(1) the fifth day after the date the notice is mailed
via United States Postal Service; or
(2) the date the notice is faxed or electronically
delivered.
(f) An insurance carrier, or the carrier's authorized agent
or an informal or voluntary network at the carrier's request, shall
provide copies of each contract described by Subsection (c) to the
division on the request of the division. Information included in a
contract under Subsection (c) is confidential and is not subject to
disclosure under Chapter 552, Government Code. Notwithstanding
Subsection (c), the insurance carrier may be required to pay fees in
accordance with the division's fee guidelines if:
(1) the contract:
(A) is not provided to the division on the
division's request;
(B) does not include a specific fee schedule
consistent with Subsection (c); or
(C) does not clearly state that the contractual
fee arrangement is between the health care provider and the named
insurance carrier or the carrier's authorized agent; or
(2) the carrier or the carrier's authorized agent does
not comply with the notice requirements under Subsection (d).
(g) Failure to provide documentation described by
Subsection (e) to the division on the request of the division or
failure to provide notice as required under Subsection (d) creates
a rebuttable presumption in an enforcement action under this
subtitle and in a medical fee dispute under Chapter 413 that a
health care provider did not receive the notice.
(h) An insurance carrier or the carrier's authorized agent
commits an administrative violation if the carrier or agent
violates any provision of this section. Any administrative penalty
assessed under this subsection shall be assessed against the
carrier, regardless of whether the carrier or agent committed the
violation.
(i) Notwithstanding Section 1305.003(b), Insurance Code, in
the event of a conflict between this section and Section 413.016 or
any other provision of Chapter 413 of this code or Chapter 1305,
Insurance Code, this section prevails.
Sec. 408.0282. REQUIREMENTS FOR CERTAIN INFORMAL OR
VOLUNTARY NETWORKS. (a) Each informal or voluntary network
described by Section 408.0281 shall, not later than the 30th day
after the date the network is established, report the following
information to the division:
(1) the name of the informal or voluntary network and
federal employer identification number;
(2) an executive contact for official correspondence
for the informal or voluntary network;
(3) a toll-free telephone number by which a health
care provider may contact the informal or voluntary network;
(4) a list of each insurance carrier with whom the
informal or voluntary network contracts, including the carrier's
federal employer identification number; and
(5) a list of, and contact information for, each
entity with which the informal or voluntary network has a contract
or other business relationship that benefits or is entered into on
behalf of an insurance carrier, including an insurance carrier's
authorized agent or a subsidiary or other affiliate of the network.
(b) Each informal or voluntary network shall report any
changes to the information provided under Subsection (a) to the
division not later than the 30th day after the effective date of the
change.
(c) An informal or voluntary network shall submit a report
required under this section, including a report of changes required
under Subsection (b), to the division through the division's online
reporting system available through the division's Internet
website.
(d) An informal or voluntary network commits an
administrative violation if the informal or voluntary network
violates any provision of this section.
SECTION 4. Section 1305.101(c), Insurance Code, is amended
to read as follows:
(c) Notwithstanding any other provision of this chapter,
prescription medication or services, as defined by Section
401.011(19)(E), Labor Code, may not, directly or through a
contract, be delivered through a workers' compensation health care
network. Prescription medication and services shall be reimbursed
as provided by Section 408.0281, Labor Code, other provisions of
the Texas Workers' Compensation Act, and applicable rules of the
commissioner of workers' compensation.
SECTION 5. (a) With respect to a contractual agreement that
provides for fees for pharmaceutical services that are different
from the fees authorized under the fee guidelines adopted by the
commissioner of workers' compensation under Title 5, Labor Code,
and that is in effect on the effective date of this Act, the notice
required under Section 408.0281(d), Labor Code, as added by this
Act, shall be sent not later than the 30th day after the effective
date of this Act, and subsequent notices required under that
section shall be sent on a quarterly basis.
(b) With respect to a contractual agreement that provides
for fees for pharmaceutical services that are different from the
fees authorized under the fee guidelines adopted by the
commissioner of workers' compensation under Title 5, Labor Code,
and that is entered into after the effective date of this Act, the
notice required under Section 408.0281(d), Labor Code, as added by
this Act, shall be sent not later than the 30th day after the
effective date of the contract, and subsequent notices required
under that section shall be sent on a quarterly basis.
SECTION 6. Each informal or voluntary network described by
Section 408.0281, Labor Code, as added by this Act, that has a
contract between an insurance carrier or an insurance carrier's
authorized agent and a health care provider for the provision of
pharmaceutical services that is in effect on the effective date of
this Act shall file the report described by Section 408.0282(a),
Labor Code, as added by this Act, not later than the 30th day after
the effective date of this Act.
SECTION 7. A contractual agreement between an insurance
carrier and a health care provider that provides for fees for
pharmaceutical services that are different from the fees authorized
under the fee guidelines adopted by the commissioner of workers'
compensation under Title 5, Labor Code, that was in effect on any
date between and including January 1, 2011, and the effective date
of this Act, and that is arranged under a contract with an informal
or voluntary network registered with the division of workers'
compensation of the Texas Department of Insurance under Section
413.0115, Labor Code, is validated and may not be the sole basis of
an enforcement action under Title 5, Labor Code.
SECTION 8. If any provision of this Act or its application
to any person or circumstance is held invalid, the invalidity does
not affect other provisions or applications of this Act that can be
given effect without the invalid provision or application, and to
this end the provisions of this Act are severable.
SECTION 9. 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. 528 was passed by the House on May 4,
2011, by the following vote: Yeas 139, Nays 0, 2 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 528 was passed by the Senate on May
24, 2011, by the following vote: Yeas 31, Nays 0.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor