Bill Text: TX SB1591 | 2019-2020 | 86th Legislature | Introduced
Bill Title: Relating to prohibited balance billing and an independent dispute resolution program for out-of-network coverage under certain managed care plans; authorizing a fee.
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2019-03-26 - Co-author authorized [SB1591 Detail]
Download: Texas-2019-SB1591-Introduced.html
86R10376 SCL-F | ||
By: Whitmire | S.B. No. 1591 |
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relating to prohibited balance billing and an independent dispute | ||
resolution program for out-of-network coverage under certain | ||
managed care plans; authorizing a fee. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle C, Title 8, Insurance Code, is amended | ||
by adding Chapter 1275 to read as follows: | ||
CHAPTER 1275. ENROLLEE RESPONSIBILITY FOR COVERED OUT-OF-NETWORK | ||
SERVICES | ||
Sec. 1275.0001. DEFINITIONS. In this chapter: | ||
(1) "Enrollee" means an individual who is eligible for | ||
coverage under a health benefit plan. | ||
(2) "Health benefit plan" means an individual, group, | ||
blanket, or franchise insurance policy or insurance agreement, a | ||
group hospital service contract, or an individual or group evidence | ||
of coverage or similar coverage document that provides benefits for | ||
health care services. The term does not include: | ||
(A) the state Medicaid program, including the | ||
Medicaid managed care program operated under Chapter 533, | ||
Government Code; | ||
(B) the child health plan program operated under | ||
Chapter 62, Health and Safety Code; | ||
(C) Medicare benefits; or | ||
(D) benefits designated as excepted benefits | ||
under 42 U.S.C. Section 300gg-91(c). | ||
(3) "Health benefit plan issuer" means an entity | ||
authorized to engage in business under this code or another | ||
insurance law of this state that issues or offers to issue a health | ||
benefit plan in this state, including: | ||
(A) an insurance company; | ||
(B) a group hospital service corporation | ||
operating under Chapter 842; | ||
(C) a health maintenance organization operating | ||
under Chapter 843; and | ||
(D) a stipulated premium company operating under | ||
Chapter 884. | ||
(4) "Health care facility" means a hospital, emergency | ||
clinic, outpatient clinic, birthing center, ambulatory surgical | ||
center, or other facility licensed to provide 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 | ||
practitioner or health care facility. | ||
(7) "Managed care plan" means a health benefit plan | ||
under which health care services are provided to enrollees through | ||
contracts with health care providers and that requires enrollees to | ||
use participating providers or that provides a different level of | ||
coverage for enrollees who use participating providers. The term | ||
includes a health benefit plan issued by: | ||
(A) a health maintenance organization; | ||
(B) a preferred provider benefit plan issuer; or | ||
(C) any other health benefit plan issuer. | ||
(8) "Out-of-network provider" means a health care | ||
provider who is not a participating provider. | ||
(9) "Participating provider" means a health care | ||
provider, including a preferred provider, who has contracted with a | ||
health benefit plan issuer to provide services to enrollees. | ||
(10) "Usual, customary, and reasonable rate" has the | ||
meaning assigned by Section 1467.201. | ||
Sec. 1275.0002. APPLICABILITY OF CHAPTER. This chapter | ||
applies only with respect to a managed care plan. | ||
Sec. 1275.0003. CERTAIN PLANS EXCLUDED. This chapter does | ||
not apply to a service covered by a health benefit plan subject to | ||
Subchapter B, Chapter 1467. | ||
Sec. 1275.0004. BALANCE BILLING PROHIBITED. (a) A health | ||
benefit plan issuer shall pay for a covered service performed for an | ||
enrollee under the health benefit plan by an out-of-network | ||
provider at the usual, customary, and reasonable rate or at an | ||
agreed rate. | ||
(b) An out-of-network provider may not bill an enrollee in, | ||
and the enrollee has no financial responsibility for, an amount | ||
greater than the enrollee's responsibility under the enrollee's | ||
managed care plan, including an applicable copayment, coinsurance, | ||
or deductible. | ||
SECTION 2. Chapter 1467, Insurance Code, is amended by | ||
adding Subchapter E to read as follows: | ||
SUBCHAPTER E. INDEPENDENT DISPUTE RESOLUTION PROGRAM | ||
Sec. 1467.201. DEFINITIONS. In this subchapter: | ||
(1) "Health benefit plan" means an individual, group, | ||
blanket, or franchise insurance policy or insurance agreement, a | ||
group hospital service contract, or an individual or group evidence | ||
of coverage or similar coverage document that provides benefits for | ||
health care services. The term does not include: | ||
(A) the state Medicaid program, including the | ||
Medicaid managed care program operated under Chapter 533, | ||
Government Code; | ||
(B) the child health plan program operated under | ||
Chapter 62, Health and Safety Code; | ||
(C) Medicare benefits; or | ||
(D) benefits designated as excepted benefits | ||
under 42 U.S.C. Section 300gg-91(c). | ||
(2) "Health benefit plan issuer" means an entity | ||
authorized to engage in business under this code or another | ||
insurance law of this state that issues or offers to issue a health | ||
benefit plan in this state, including: | ||
(A) an insurance company; | ||
(B) a group hospital service corporation | ||
operating under Chapter 842; | ||
(C) a health maintenance organization operating | ||
under Chapter 843; and | ||
(D) a stipulated premium company operating under | ||
Chapter 884. | ||
(3) "Health care facility" means a hospital, emergency | ||
clinic, outpatient clinic, birthing center, ambulatory surgical | ||
center, or other facility licensed to provide health care services. | ||
(4) "Health care provider" means a health care | ||
practitioner or health care facility. | ||
(5) "Managed care plan" means a health benefit plan | ||
under which health care services are provided to enrollees through | ||
contracts with health care providers and that requires enrollees to | ||
use participating providers or that provides a different level of | ||
coverage for enrollees who use participating providers. The term | ||
includes a health benefit plan issued by: | ||
(A) a health maintenance organization; | ||
(B) a preferred provider benefit plan issuer; or | ||
(C) any other health benefit plan issuer. | ||
(6) "Out-of-network provider" means a health care | ||
provider who is not a participating provider. | ||
(7) "Participating provider" means a health care | ||
provider who has contracted with a health benefit plan issuer to | ||
provide services to enrollees. | ||
(8) "Usual, customary, and reasonable rate" means the | ||
80th percentile of all charges for a particular health care service | ||
performed by a health care provider in the same or similar specialty | ||
and provided in the same geographical area as reported in a | ||
benchmarking database described by Section 1467.203. | ||
Sec. 1467.202. APPLICABILITY OF SUBCHAPTER. This | ||
subchapter applies only with respect to a managed care plan. | ||
Sec. 1467.203. BENCHMARKING DATABASE. (a) The | ||
commissioner shall select a nonprofit organization to maintain a | ||
benchmarking database that contains information necessary to | ||
calculate the usual, customary, and reasonable rate for each | ||
geographical area in this state. | ||
(b) The commissioner may not select under Subsection (a) a | ||
nonprofit organization that is financially affiliated with a health | ||
benefit plan issuer. | ||
Sec. 1467.204. ESTABLISHMENT AND ADMINISTRATION OF | ||
PROGRAM. (a) The commissioner shall establish and administer an | ||
independent dispute resolution program to resolve disputes over | ||
out-of-network provider charges, including balance billing, in | ||
accordance with this subchapter. | ||
(b) The commissioner: | ||
(1) shall adopt rules, forms, and procedures necessary | ||
for the implementation and administration of the independent | ||
dispute resolution program; | ||
(2) may impose a fee on the parties participating in | ||
the program as necessary to cover the cost of implementation and | ||
administration of the program; and | ||
(3) shall maintain a list of qualified reviewers for | ||
the program. | ||
Sec. 1467.205. ISSUE TO BE ADDRESSED; BASIS FOR | ||
DETERMINATION. (a) The only issue that an independent reviewer may | ||
determine in a hearing under the independent dispute resolution | ||
program is the reasonable charge for the health care services | ||
provided to the enrollee by an out-of-network provider. | ||
(b) The determination must take into account: | ||
(1) whether there is a gross disparity between the fee | ||
charged by the out-of-network provider and: | ||
(A) fees paid to the out-of-network provider for | ||
the same services rendered by the provider to other enrollees for | ||
which the provider is an out-of-network provider; and | ||
(B) fees paid by the health benefit plan issuer | ||
to reimburse similarly qualified out-of-network providers for the | ||
same services in the same region; | ||
(2) the level of training, education, and experience | ||
of the out-of-network provider; | ||
(3) the out-of-network provider's usual charge for | ||
comparable services with regard to other enrollees for which the | ||
provider is an out-of-network provider; | ||
(4) the circumstances and complexity of the enrollee's | ||
particular case, including the time and place of the service; | ||
(5) individual enrollee characteristics; and | ||
(6) the usual, customary, and reasonable rate for the | ||
health care service. | ||
Sec. 1467.206. INITIATION OF PROCESS. (a) A health benefit | ||
plan issuer or out-of-network provider may initiate an independent | ||
dispute resolution process in the form and manner provided by | ||
commissioner rule to determine the amount of reimbursement for a | ||
health care service provided by the provider. | ||
(b) A party may respond to the claims made by the party | ||
initiating the independent dispute resolution process under | ||
Subsection (a) not later than the 15th day after the date the | ||
process is initiated. If the responding party fails to respond, | ||
that party accepts the claims made by the initiating party. | ||
Sec. 1467.207. SELECTION AND APPROVAL OF INDEPENDENT | ||
REVIEWERS. (a) If the parties do not select an independent | ||
reviewer by mutual agreement on or before the 30th day after the | ||
date the independent dispute resolution process is initiated, the | ||
commissioner shall select a reviewer from the commissioner's list | ||
of qualified reviewers. | ||
(b) To be eligible to serve as an independent reviewer, an | ||
individual must be knowledgeable and experienced in applicable | ||
principles of contract and insurance law and the health care | ||
industry generally. | ||
(c) In approving an individual as an independent reviewer, | ||
the commissioner shall ensure that the individual does not have a | ||
conflict of interest that would adversely impact the individual's | ||
independence and impartiality in rendering a decision in an | ||
independent dispute resolution process. A conflict of interest | ||
includes current or recent ownership or employment of the | ||
individual or a close family member in a health benefit plan issuer | ||
or out-of-network provider that may be involved in the process. | ||
(d) The commissioner shall immediately terminate the | ||
approval of an independent reviewer who no longer meets the | ||
requirements under this subchapter and rules adopted under this | ||
subchapter to serve as an independent reviewer. | ||
Sec. 1467.208. PROCEDURES. (a) A party to an independent | ||
dispute resolution process may request an oral hearing. | ||
(b) If an oral hearing is not requested, the independent | ||
reviewer shall set a date for submission of all information to be | ||
considered by the reviewer. | ||
(c) A party to an independent dispute resolution process | ||
shall submit a binding award amount to the independent reviewer. | ||
(d) An independent reviewer may make procedural rulings | ||
during an oral hearing. | ||
(e) A party may not engage in discovery in connection with | ||
an independent dispute resolution process. | ||
Sec. 1467.209. DECISION. (a) Not later than the 10th day | ||
after the date of an oral hearing or the deadline for submission of | ||
information, as applicable, an independent reviewer shall provide | ||
the parties with a written decision in which the reviewer | ||
determines which binding award amount submitted under Section | ||
1467.208 is the closest to the reasonable charge for the services | ||
provided in accordance with Section 1467.205(b). | ||
(b) An independent reviewer may not modify the binding award | ||
amount selected under Subsection (a). | ||
(c) The decision described by Subsection (a) is binding and | ||
final. The prevailing party may seek enforcement of the decision in | ||
any court of competent jurisdiction. | ||
Sec. 1467.210. ATTORNEY'S FEES AND COSTS. Unless otherwise | ||
agreed by the parties to an independent dispute resolution process, | ||
each party shall: | ||
(1) bear the party's own attorney's fees and costs; and | ||
(2) equally split the fees and costs of the | ||
independent reviewer. | ||
SECTION 3. Sections 1467.001(3), (5), and (7), Insurance | ||
Code, are amended to read as follows: | ||
(3) "Enrollee" means an individual who is eligible to | ||
receive benefits through [ |
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health benefit plan [ |
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(5) "Mediation" means a process in which an impartial | ||
mediator facilitates and promotes agreement between an [ |
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and a facility-based provider or emergency care provider or the | ||
provider's representative to settle a health benefit claim of an | ||
enrollee. | ||
(7) "Party" means a health [ |
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facility-based provider or emergency care provider or the | ||
provider's representative who participates in a mediation | ||
conducted under this chapter. The enrollee is also considered a | ||
party to the mediation. | ||
SECTION 4. Section 1467.002, Insurance Code, is amended to | ||
read as follows: | ||
Sec. 1467.002. APPLICABILITY OF CHAPTER. Except as | ||
provided by Subchapter E, this [ |
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[ |
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[ |
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than a health maintenance organization plan, under Chapter 1551, | ||
1575, or 1579. | ||
SECTION 5. Section 1467.005, Insurance Code, is amended to | ||
read as follows: | ||
Sec. 1467.005. REFORM. This chapter may not be construed to | ||
prohibit: | ||
(1) an [ |
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settlement; or | ||
(2) a facility-based provider or emergency care | ||
provider from, at any time, offering a reformed charge for health | ||
care or medical services or supplies. | ||
SECTION 6. Sections 1467.051(a) and (b), Insurance Code, | ||
are amended to read as follows: | ||
(a) An enrollee may request mediation of a settlement of an | ||
out-of-network health benefit claim if: | ||
(1) the amount for which the enrollee is responsible | ||
to a facility-based provider or emergency care provider, after | ||
copayments, deductibles, and coinsurance, including the amount | ||
unpaid by the administrator [ |
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(2) the health benefit claim is for: | ||
(A) emergency care; or | ||
(B) a health care or medical service or supply | ||
provided by a facility-based provider in a facility that is a | ||
preferred provider or that has a contract with the administrator. | ||
(b) Except as provided by Subsections (c) and (d), if an | ||
enrollee requests mediation under this subchapter, the | ||
facility-based provider or emergency care provider, or the | ||
provider's representative, and [ |
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administrator[ |
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mediation. | ||
SECTION 7. Section 1467.0511, Insurance Code, is amended to | ||
read as follows: | ||
Sec. 1467.0511. NOTICE AND INFORMATION PROVIDED TO | ||
ENROLLEE. (a) A bill sent to an enrollee by a facility-based | ||
provider or emergency care provider or an explanation of benefits | ||
sent to an enrollee by an [ |
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out-of-network health benefit claim eligible for mediation under | ||
this chapter must contain, in not less than 10-point boldface type, | ||
a conspicuous, plain-language explanation of the mediation process | ||
available under this chapter, including information on how to | ||
request mediation and a statement that is substantially similar to | ||
the following: | ||
"You may be able to reduce some of your out-of-pocket costs | ||
for an out-of-network medical or health care claim that is eligible | ||
for mediation by contacting the Texas Department of Insurance at | ||
(website) and (phone number)." | ||
(b) If an enrollee contacts an [ |
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facility-based provider, or emergency care provider about a bill | ||
that may be eligible for mediation under this chapter, the | ||
[ |
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care provider is encouraged to: | ||
(1) inform the enrollee about mediation under this | ||
chapter; and | ||
(2) provide the enrollee with the department's | ||
toll-free telephone number and Internet website address. | ||
SECTION 8. Section 1467.052(c), Insurance Code, is amended | ||
to read as follows: | ||
(c) A person may not act as mediator for a claim settlement | ||
dispute if the person has been employed by, consulted for, or | ||
otherwise had a business relationship with [ |
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practitioner, or other health care provider during the three years | ||
immediately preceding the request for mediation. | ||
SECTION 9. Section 1467.053(d), Insurance Code, is amended | ||
to read as follows: | ||
(d) The mediator's fees shall be split evenly and paid by | ||
the [ |
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emergency care provider. | ||
SECTION 10. Sections 1467.054(b) and (c), Insurance Code, | ||
are amended to read as follows: | ||
(b) A request for mandatory mediation must be provided to | ||
the department on a form prescribed by the commissioner and must | ||
include: | ||
(1) the name of the enrollee requesting mediation; | ||
(2) a brief description of the claim to be mediated; | ||
(3) contact information, including a telephone | ||
number, for the requesting enrollee and the enrollee's counsel, if | ||
the enrollee retains counsel; | ||
(4) the name of the facility-based provider or | ||
emergency care provider and name of the [ |
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and | ||
(5) any other information the commissioner may require | ||
by rule. | ||
(c) On receipt of a request for mediation, the department | ||
shall notify the facility-based provider or emergency care provider | ||
and [ |
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SECTION 11. Section 1467.055(i), Insurance Code, is amended | ||
to read as follows: | ||
(i) A health care or medical service or supply provided by a | ||
facility-based provider or emergency care provider may not be | ||
summarily disallowed. This subsection does not require an [ |
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SECTION 12. Sections 1467.056(a), (b), and (d), Insurance | ||
Code, are amended to read as follows: | ||
(a) In a mediation under this chapter, the parties shall: | ||
(1) evaluate whether: | ||
(A) the amount charged by the facility-based | ||
provider or emergency care provider for the health care or medical | ||
service or supply is excessive; and | ||
(B) the amount paid by the [ |
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administrator represents the usual and customary rate for the | ||
health care or medical service or supply or is unreasonably low; and | ||
(2) as a result of the amounts described by | ||
Subdivision (1), determine the amount, after copayments, | ||
deductibles, and coinsurance are applied, for which an enrollee is | ||
responsible to the facility-based provider or emergency care | ||
provider. | ||
(b) The facility-based provider or emergency care provider | ||
may present information regarding the amount charged for the health | ||
care or medical service or supply. The [ |
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may present information regarding the amount paid by the [ |
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(d) The goal of the mediation is to reach an agreement among | ||
the enrollee, the facility-based provider or emergency care | ||
provider, and the [ |
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to the amount paid by the [ |
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facility-based provider or emergency care provider, the amount | ||
charged by the facility-based provider or emergency care provider, | ||
and the amount paid to the facility-based provider or emergency | ||
care provider by the enrollee. | ||
SECTION 13. Section 1467.058, Insurance Code, is amended to | ||
read as follows: | ||
Sec. 1467.058. CONTINUATION OF MEDIATION. After a referral | ||
is made under Section 1467.057, the facility-based provider or | ||
emergency care provider and the [ |
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elect to continue the mediation to further determine their | ||
responsibilities. Continuation of mediation under this section | ||
does not affect the amount of the billed charge to the enrollee. | ||
SECTION 14. Section 1467.151(b), Insurance Code, is amended | ||
to read as follows: | ||
(b) The department and the Texas Medical Board or other | ||
appropriate regulatory agency shall maintain information: | ||
(1) on each complaint filed that concerns a claim or | ||
mediation subject to this chapter; and | ||
(2) related to a claim that is the basis of an enrollee | ||
complaint, including: | ||
(A) the type of services that gave rise to the | ||
dispute; | ||
(B) the type and specialty, if any, of the | ||
facility-based provider or emergency care provider who provided the | ||
out-of-network service; | ||
(C) the county and metropolitan area in which the | ||
health care or medical service or supply was provided; | ||
(D) whether the health care or medical service or | ||
supply was for emergency care; and | ||
(E) any other information about: | ||
(i) the [ |
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commissioner by rule requires; or | ||
(ii) the facility-based provider or | ||
emergency care provider that the Texas Medical Board or other | ||
appropriate regulatory agency by rule requires. | ||
SECTION 15. The changes in law made by this Act apply only | ||
to a health benefit plan delivered, issued for delivery, or renewed | ||
on or after January 1, 2020. A health benefit plan delivered, | ||
issued for delivery, or renewed before January 1, 2020, 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 16. This Act takes effect September 1, 2019. |