Texas 2009 - 81st Regular

Texas House Bill HB2256 Compare Versions

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1	1	H.B. No. 2256
2	2
3	3
4	4	AN ACT
5	5	relating to mediation of out-of-network health benefit claim
6	6	disputes concerning enrollees, facility-based physicians, and
7	7	certain health benefit plans; imposing an administrative penalty.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Subtitle F, Title 8, Insurance Code, is amended
10	10	by adding Chapter 1467 to read as follows:
11	11	CHAPTER 1467. OUT-OF-NETWORK CLAIM DISPUTE RESOLUTION
12	12	SUBCHAPTER A. GENERAL PROVISIONS
13	13	Sec. 1467.001. DEFINITIONS. In this chapter:
14	14	(1) "Administrator" means:
15	15	(A) an administering firm for a health benefit
16	16	plan providing coverage under Chapter 1551; and
17	17	(B) if applicable, the claims administrator for
18	18	the health benefit plan.
19	19	(2) "Chief administrative law judge" means the chief
20	20	administrative law judge of the State Office of Administrative
21	21	Hearings.
22	22	(3) "Enrollee" means an individual who is eligible to
23	23	receive benefits through a preferred provider benefit plan or a
24	24	health benefit plan under Chapter 1551.
25	25	(4) "Facility-based physician" means a radiologist,
26	26	an anesthesiologist, a pathologist, an emergency department
27	27	physician, or a neonatologist:
28	28	(A) to whom the facility has granted clinical
29	29	privileges; and
30	30	(B) who provides services to patients of the
31	31	facility under those clinical privileges.
32	32	(5) "Mediation" means a process in which an impartial
33	33	mediator facilitates and promotes agreement between the insurer
34	34	offering a preferred provider benefit plan or the administrator and
35	35	a facility-based physician or the physician's representative to
36	36	settle a health benefit claim of an enrollee.
37	37	(6) "Mediator" means an impartial person who is
38	38	appointed to conduct a mediation under this chapter.
39	39	(7) "Party" means an insurer offering a preferred
40	40	provider benefit plan, an administrator, or a facility-based
41	41	physician or the physician's representative who participates in a
42	42	mediation conducted under this chapter. The enrollee is also
43	43	considered a party to the mediation.
44	44	Sec. 1467.002. APPLICABILITY OF CHAPTER. This chapter
45	45	applies to:
46	46	(1) a preferred provider benefit plan offered by an
47	47	insurer under Chapter 1301; and
48	48	(2) an administrator of a health benefit plan, other
49	49	than a health maintenance organization plan, under Chapter 1551.
50	50	Sec. 1467.003. RULES. The commissioner, the Texas Medical
51	51	Board, and the chief administrative law judge shall adopt rules as
52	52	necessary to implement their respective powers and duties under
53	53	this chapter.
54	54	Sec. 1467.004. REMEDIES NOT EXCLUSIVE. The remedies
55	55	provided by this chapter are in addition to any other defense,
56	56	remedy, or procedure provided by law, including the common law.
57	57	Sec. 1467.005. REFORM. This chapter may not be construed to
58	58	prohibit:
59	59	(1) an insurer offering a preferred provider benefit
60	60	plan or administrator from, at any time, offering a reformed claim
61	61	settlement; or
62	62	(2) a facility-based physician from, at any time,
63	63	offering a reformed charge for medical services.
64	64	[Sections 1467.006-1467.050 reserved for expansion]
65	65	SUBCHAPTER B. MANDATORY MEDIATION
66	66	Sec. 1467.051. AVAILABILITY OF MANDATORY MEDIATION;
67	67	EXCEPTION. (a) An enrollee may request mediation of a settlement of
68	68	an out-of-network health benefit claim if:
69	69	(1) the amount for which the enrollee is responsible
70	70	to a facility-based physician, after copayments, deductibles, and
71	71	coinsurance, including the amount unpaid by the administrator or
72	72	insurer, is greater than $1,000; and
73	73	(2) the health benefit claim is for a medical service
74	74	or supply provided by a facility-based physician in a hospital that
75	75	is a preferred provider or that has a contract with the
76	76	administrator.
77	77	(b) Except as provided by Subsections (c) and (d), if an
78	78	enrollee requests mediation under this subchapter, the
79	79	facility-based physician or the physician's representative and the
80	80	insurer or the administrator, as appropriate, shall participate in
81	81	the mediation.
82	82	(c) Except in the case of an emergency and if requested by
83	83	the enrollee, a facility-based physician shall, before providing a
84	84	medical service or supply, provide a complete disclosure to an
85	85	enrollee that:
86	86	(1) explains that the facility-based physician does
87	87	not have a contract with the enrollee's health benefit plan;
88	88	(2) discloses projected amounts for which the enrollee
89	89	may be responsible; and
90	90	(3) discloses the circumstances under which the
91	91	enrollee would be responsible for those amounts.
92	92	(d) A facility-based physician who makes a disclosure under
93	93	Subsection (c) and obtains the enrollee's written acknowledgment of
94	94	that disclosure may not be required to mediate a billed charge under
95	95	this subchapter if the amount billed is less than or equal to the
96	96	maximum amount projected in the disclosure.
97	97	Sec. 1467.052. MEDIATOR QUALIFICATIONS. (a) Except as
98	98	provided by Subsection (b), to qualify for an appointment as a
99	99	mediator under this chapter a person must have completed at least 40
100	100	classroom hours of training in dispute resolution techniques in a
101	101	course conducted by an alternative dispute resolution organization
102	102	or other dispute resolution organization approved by the chief
103	103	administrative law judge.
104	104	(b) A person not qualified under Subsection (a) may be
105	105	appointed as a mediator on agreement of the parties.
106	106	(c) A person may not act as mediator for a claim settlement
107	107	dispute if the person has been employed by, consulted for, or
108	108	otherwise had a business relationship with an insurer offering the
109	109	preferred provider benefit plan or a physician during the three
110	110	years immediately preceding the request for mediation.
111	111	Sec. 1467.053. APPOINTMENT OF MEDIATOR; FEES. (a) A
112	112	mediation shall be conducted by one mediator.
113	113	(b) The chief administrative law judge shall appoint the
114	114	mediator through a random assignment from a list of qualified
115	115	mediators maintained by the State Office of Administrative
116	116	Hearings.
117	117	(c) Notwithstanding Subsection (b), a person other than a
118	118	mediator appointed by the chief administrative law judge may
119	119	conduct the mediation on agreement of all of the parties and notice
120	120	to the chief administrative law judge.
121	121	(d) The mediator's fees shall be split evenly and paid by
122	122	the insurer or administrator and the facility-based physician.
123	123	Sec. 1467.054. REQUEST AND PRELIMINARY PROCEDURES FOR
124	124	MANDATORY MEDIATION. (a) An enrollee may request mandatory
125	125	mediation under this chapter.
126	126	(b) A request for mandatory mediation must be provided to
127	127	the department on a form prescribed by the commissioner and must
128	128	include:
129	129	(1) the name of the enrollee requesting mediation;
130	130	(2) a brief description of the claim to be mediated;
131	131	(3) contact information, including a telephone
132	132	number, for the requesting enrollee and the enrollee's counsel, if
133	133	the enrollee retains counsel;
134	134	(4) the name of the facility-based physician and name
135	135	of the insurer or administrator; and
136	136	(5) any other information the commissioner may require
137	137	by rule.
138	138	(c) On receipt of a request for mediation, the department
139	139	shall notify the facility-based physician and insurer or
140	140	administrator of the request.
141	141	(d) In an effort to settle the claim before mediation, all
142	142	parties must participate in an informal settlement teleconference
143	143	not later than the 30th day after the date on which the enrollee
144	144	submits a request for mediation under this section.
145	145	(e) A dispute to be mediated under this chapter that does
146	146	not settle as a result of a teleconference conducted under
147	147	Subsection (d) must be conducted in the county in which the medical
148	148	services were rendered.
149	149	(f) The enrollee may elect to participate in the mediation.
150	150	A mediation may not proceed without the consent of the enrollee. An
151	151	enrollee may withdraw the request for mediation at any time before
152	152	the mediation.
153	153	(g) Notwithstanding Subsection (f), mediation may proceed
154	154	without the participation of the enrollee or the enrollee's
155	155	representative if the enrollee or representative is not present in
156	156	person or through teleconference.
157	157	Sec. 1467.055. CONDUCT OF MEDIATION; CONFIDENTIALITY. (a)
158	158	A mediator may not impose the mediator's judgment on a party about
159	159	an issue that is a subject of the mediation.
160	160	(b) A mediation session is under the control of the
161	161	mediator.
162	162	(c) Except as provided by this chapter, the mediator must
163	163	hold in strict confidence all information provided to the mediator
164	164	by a party and all communications of the mediator with a party.
165	165	(d) If the enrollee is participating in the mediation in
166	166	person, at the beginning of the mediation the mediator shall inform
167	167	the enrollee that if the enrollee is not satisfied with the mediated
168	168	agreement, the enrollee may file a complaint with:
169	169	(1) the Texas Medical Board against the facility-based
170	170	physician for improper billing; and
171	171	(2) the department for unfair claim settlement
172	172	practices.
173	173	(e) A party must have an opportunity during the mediation to
174	174	speak and state the party's position.
175	175	(f) Except on the agreement of the participating parties, a
176	176	mediation may not last more than four hours.
177	177	(g) Except at the request of an enrollee, a mediation shall
178	178	be held not later than the 180th day after the date of the request
179	179	for mediation.
180	180	(h) On receipt of notice from the department that an
181	181	enrollee has made a request for mediation that meets the
182	182	requirements of this chapter, the facility-based physician may not
183	183	pursue any collection effort against the enrollee who has requested
184	184	mediation for amounts other than copayments, deductibles, and
185	185	coinsurance before the earlier of:
186	186	(1) the date the mediation is completed; or
187	187	(2) the date the request to mediate is withdrawn.
188	188	(i) A service provided by a facility-based physician may not
189	189	be summarily disallowed. This subsection does not require an
190	190	insurer or administrator to pay for an uncovered service.
191	191	(j) A mediator may not testify in a proceeding, other than a
192	192	proceeding to enforce this chapter, related to the mediation
193	193	agreement.
194	194	Sec. 1467.056. MATTERS CONSIDERED IN MEDIATION; AGREED
195	195	RESOLUTION. (a) In a mediation under this chapter, the parties
196	196	shall:
197	197	(1) evaluate whether:
198	198	(A) the amount charged by the facility-based
199	199	physician for the medical service or supply is excessive; and
200	200	(B) the amount paid by the insurer or
201	201	administrator represents the usual and customary rate for the
202	202	medical service or supply or is unreasonably low; and
203	203	(2) as a result of the amounts described by
204	204	Subdivision (1), determine the amount, after copayments,
205	205	deductibles, and coinsurance are applied, for which an enrollee is
206	206	responsible to the facility-based physician.
207	207	(b) The facility-based physician may present information
208	208	regarding the amount charged for the medical service or supply. The
209	209	insurer or administrator may present information regarding the
210	210	amount paid by the insurer.
211	211	(c) Nothing in this chapter prohibits mediation of more than
212	212	one claim between the parties during a mediation.
213	213	(d) The goal of the mediation is to reach an agreement among
214	214	the enrollee, the facility-based physician, and the insurer or
215	215	administrator, as applicable, as to the amount paid by the insurer
216	216	or administrator to the facility-based physician, the amount
217	217	charged by the facility-based physician, and the amount paid to the
218	218	facility-based physician by the enrollee.
219	219	Sec. 1467.057. NO AGREED RESOLUTION. (a) The mediator of
220	220	an unsuccessful mediation under this chapter shall report the
221	221	outcome of the mediation to the department, the Texas Medical
222	222	Board, and the chief administrative law judge.
223	223	(b) The chief administrative law judge shall enter an order
224	224	of referral of a matter reported under Subsection (a) to a special
225	225	judge under Chapter 151, Civil Practice and Remedies Code, that:
226	226	(1) names the special judge on whom the parties agreed
227	227	or appoints the special judge if the parties did not agree on a
228	228	judge;
229	229	(2) states the issues to be referred and the time and
230	230	place on which the parties agree for the trial;
231	231	(3) requires each party to pay the party's
232	232	proportionate share of the special judge's fee; and
233	233	(4) certifies that the parties have waived the right
234	234	to trial by jury.
235	235	(c) A trial by the special judge selected or appointed as
236	236	described by Subsection (b) must proceed under Chapter 151, Civil
237	237	Practice and Remedies Code, except that the special judge's verdict
238	238	is not relevant or material to any other balance bill dispute and
239	239	has no precedential value.
240	240	(d) Notwithstanding any other provision of this section,
241	241	Section 151.012, Civil Practice and Remedies Code, does not apply
242	242	to a mediation under this chapter.
243	243	Sec. 1467.058. CONTINUATION OF MEDIATION. After a referral
244	244	is made under Section 1467.057, the facility-based physician and
245	245	the insurer or administrator may elect to continue the mediation to
246	246	further determine their responsibilities. Continuation of
247	247	mediation under this section does not affect the amount of the
248	248	billed charge to the enrollee.
249	249	Sec. 1467.059. MEDIATION AGREEMENT. The mediator shall
250	250	prepare a confidential mediation agreement and order that states:
251	251	(1) the total amount for which the enrollee will be
252	252	responsible to the facility-based physician, after copayments,
253	253	deductibles, and coinsurance; and
254	254	(2) any agreement reached by the parties under Section
255	255	1467.058.
256	256	Sec. 1467.060. REPORT OF MEDIATOR. The mediator shall
257	257	report to the commissioner and the Texas Medical Board:
258	258	(1) the names of the parties to the mediation; and
259	259	(2) whether the parties reached an agreement or the
260	260	mediator made a referral under Section 1467.057.
261	261	[Sections 1467.061-1467.100 reserved for expansion]
262	262	SUBCHAPTER C. BAD FAITH MEDIATION
263	263	Sec. 1467.101. BAD FAITH. (a) The following conduct
264	264	constitutes bad faith mediation for purposes of this chapter:
265	265	(1) failing to participate in the mediation;
266	266	(2) failing to provide information the mediator
267	267	believes is necessary to facilitate an agreement; or
268	268	(3) failing to designate a representative
269	269	participating in the mediation with full authority to enter into
270	270	any mediated agreement.
271	271	(b) Failure to reach an agreement is not conclusive proof of
272	272	bad faith mediation.
273	273	(c) A mediator shall report bad faith mediation to the
274	274	commissioner or the Texas Medical Board, as appropriate, following
275	275	the conclusion of the mediation.
276	276	Sec. 1467.102. PENALTIES. (a) Bad faith mediation, by a
277	277	party other than the enrollee, is grounds for imposition of an
278	278	administrative penalty by the regulatory agency that issued a
279	279	license or certificate of authority to the party who committed the
280	280	violation.
281	281	(b) Except for good cause shown, on a report of a mediator
282	282	and appropriate proof of bad faith mediation, the regulatory agency
283	283	that issued the license or certificate of authority shall impose an
284	284	administrative penalty.
285	285	[Sections 1467.103-1467.150 reserved for expansion]
286	286	SUBCHAPTER D. COMPLAINTS; CONSUMER PROTECTION
287	287	Sec. 1467.151. CONSUMER PROTECTION; RULES. (a) The
288	288	commissioner and the Texas Medical Board, as appropriate, shall
289	289	adopt rules regulating the investigation and review of a complaint
290	290	filed that relates to the settlement of an out-of-network health
291	291	benefit claim that is subject to this chapter. The rules adopted
292	292	under this section must:
293	293	(1) distinguish among complaints for out-of-network
294	294	coverage or payment and give priority to investigating allegations
295	295	of delayed medical care;
296	296	(2) develop a form for filing a complaint and
297	297	establish an outreach effort to inform enrollees of the
298	298	availability of the claims dispute resolution process under this
299	299	chapter;
300	300	(3) ensure that a complaint is not dismissed without
301	301	appropriate consideration;
302	302	(4) ensure that enrollees are informed of the
303	303	availability of mandatory mediation; and
304	304	(5) require the administrator to include a notice of
305	305	the claims dispute resolution process available under this chapter
306	306	with the explanation of benefits sent to an enrollee.
307	307	(b) The department and the Texas Medical Board shall
308	308	maintain information:
309	309	(1) on each complaint filed that concerns a claim or
310	310	mediation subject to this chapter; and
311	311	(2) related to a claim that is the basis of an enrollee
312	312	complaint, including:
313	313	(A) the type of services that gave rise to the
314	314	dispute;
315	315	(B) the type and specialty of the facility-based
316	316	physician who provided the out-of-network service;
317	317	(C) the county and metropolitan area in which the
318	318	medical service or supply was provided;
319	319	(D) whether the medical service or supply was for
320	320	emergency care; and
321	321	(E) any other information about:
322	322	(i) the insurer or administrator that the
323	323	commissioner by rule requires; or
324	324	(ii) the physician that the Texas Medical
325	325	Board by rule requires.
326	326	(c) The information collected and maintained by the
327	327	department and the Texas Medical Board under Subsection (b)(2) is
328	328	public information as defined by Section 552.002, Government Code,
329	329	and may not include personally identifiable information or medical
330	330	information.
331	331	(d) A facility-based physician who fails to provide a
332	332	disclosure under Section 1467.051 is not subject to discipline by
333	333	the Texas Medical Board for that failure and a cause of action is
334	334	not created by a failure to disclose as required by Section
335	335	1467.051.
336	336	SECTION 2. Subchapter A, Chapter 1301, Insurance Code, is
337	337	amended by adding Section 1301.0055 to read as follows:
338	338	Sec. 1301.0055. NETWORK ADEQUACY STANDARDS. The
339	339	commissioner shall by rule adopt network adequacy standards that:
340	340	(1) are adapted to local markets in which an insurer
341	341	offering a preferred provider benefit plan operates;
342	342	(2) ensure availability of, and accessibility to, a
343	343	full range of contracted physicians and health care providers to
344	344	provide health care services to insureds; and
345	345	(3) on good cause shown, may allow departure from
346	346	local market network adequacy standards if the commissioner posts
347	347	on the department's Internet website the name of the preferred
348	348	provider plan, the insurer offering the plan, and the affected
349	349	local market.
350	350	SECTION 3. Section 1456.004, Insurance Code, is amended by
351	351	adding Subsection (c) to read as follows:
352	352	(c) A facility-based physician who bills a patient covered
353	353	by a preferred provider benefit plan or a health benefit plan under
354	354	Chapter 1551 that does not have a contract with the facility-based
355	355	physician shall send a billing statement to the patient with
356	356	information sufficient to notify the patient of the mandatory
357	357	mediation process available under Chapter 1467 if the amount for
358	358	which the enrollee is responsible, after copayments, deductibles,
359	359	and coinsurance, including the amount unpaid by the administrator
360	360	or insurer, is greater than $1,000.
361	361	SECTION 4. Section 324.001, Health and Safety Code, is
362	362	amended by adding Subsection (8) to read as follows:
363	363	(8) "Facility-based physician" means a radiologist,
364	364	an anesthesiologist, a pathologist, an emergency department
365	365	physician, or a neonatologist.
366	366	SECTION 5. Section 324.101(a), Health and Safety Code, is
367	367	amended to read as follows:
368	368	(a) Each facility shall develop, implement, and enforce
369	369	written policies for the billing of facility health care services
370	370	and supplies. The policies must address:
371	371	(1) any discounting of facility charges to an
372	372	uninsured consumer, subject to Chapter 552, Insurance Code;
373	373	(2) any discounting of facility charges provided to a
374	374	financially or medically indigent consumer who qualifies for
375	375	indigent services based on a sliding fee scale or a written charity
376	376	care policy established by the facility and the documented income
377	377	and other resources of the consumer;
378	378	(3) the providing of an itemized statement required by
379	379	Subsection (e);
380	380	(4) whether interest will be applied to any billed
381	381	service not covered by a third-party payor and the rate of any
382	382	interest charged;
383	383	(5) the procedure for handling complaints; [and]
384	384	(6) the providing of a conspicuous written disclosure
385	385	to a consumer at the time the consumer is first admitted to the
386	386	facility or first receives services at the facility that:
387	387	(A) provides confirmation whether the facility
388	388	is a participating provider under the consumer's third-party payor
389	389	coverage on the date services are to be rendered based on the
390	390	information received from the consumer at the time the confirmation
391	391	is provided; [and]
392	392	(B) informs consumers [the consumer] that a
393	393	facility-based physician [or other health care provider] who may
394	394	provide services to the consumer while the consumer is in the
395	395	facility may not be a participating provider with the same
396	396	third-party payors as the facility;
397	397	(C) informs consumers that the consumer may
398	398	receive a bill for medical services from a facility-based physician
399	399	for the amount unpaid by the consumer's health benefit plan;
400	400	(D) informs consumers that the consumer may
401	401	request a listing of facility-based physicians who have been
402	402	granted medical staff privileges to provide medical services at
403	403	the facility; and
404	404	(E) informs consumers that the consumer may
405	405	request information from a facility-based physician on whether the
406	406	physician has a contract with the consumer's health benefit plan
407	407	and under what circumstances the consumer may be responsible for
408	408	payment of any amounts not paid by the consumer's health benefit
409	409	plan;
410	410	(7) the requirement that a facility provide a list, on
411	411	request, to a consumer to be admitted to, or who is expected to
412	412	receive services from, the facility, that contains the name and
413	413	contact information for each facility-based physician or
414	414	facility-based physician group that has been granted medical staff
415	415	privileges to provide medical services at the facility; and
416	416	(8) if the facility operates a website that includes a
417	417	listing of physicians who have been granted medical staff
418	418	privileges to provide medical services at the facility, the posting
419	419	on the facility's website of a list that contains the name and
420	420	contact information for each facility-based physician or
421	421	facility-based physician group that has been granted medical staff
422	422	privileges to provide medical services at the facility and the
423	423	updating of the list in any calendar quarter in which there are any
424	424	changes to the list.
425	425	SECTION 6. (a) Except as provided by Subsection (b), this
426	426	Act applies only to a health benefit claim filed on or after the
427	427	effective date of this Act. A claim filed before the effective date
428	428	of this Act is governed by the law as it existed immediately before
429	429	the effective date of this Act, and that law is continued in effect
430	430	for that purpose.
431	431	(b) Section 1467.002(2), Insurance Code, as added by this
432	432	Act, applies to a health benefit claim filed under a group policy or
433	433	contract executed under Chapter 1551, Insurance Code, on or after
434	434	September 1, 2010. A claim filed under a group policy or contract
435	435	executed under Chapter 1551, Insurance Code, before September 1,
436	436	2010, is governed by the law as it existed immediately before
437	437	September 1, 2010, and that law is continued in effect for that
438	438	purpose.
439	439	SECTION 7. As soon as practicable after the effective date
440	440	of this Act, the commissioner of insurance, Texas Medical Board,
441	441	and chief administrative law judge of the State Office of
442	442	Administrative Hearings shall adopt rules as necessary to implement
443	443	and enforce this Act.
444	444	SECTION 8. This Act takes effect immediately if it receives
445	445	a vote of two-thirds of all the members elected to each house, as
446	446	provided by Section 39, Article III, Texas Constitution. If this
447	447	Act does not receive the vote necessary for immediate effect, this
448	448	Act takes effect September 1, 2009.
449	449	______________________________ ______________________________
450	450	President of the Senate Speaker of the House
451	451	I certify that H.B. No. 2256 was passed by the House on May
452	452	11, 2009, by the following vote: Yeas 139, Nays 2, 3 present, not
453	453	voting; and that the House concurred in Senate amendments to H.B.
454	454	No. 2256 on May 29, 2009, by the following vote: Yeas 136, Nays 1,
455	455	4 present, not voting.
456	456	______________________________
457	457	Chief Clerk of the House
458	458	I certify that H.B. No. 2256 was passed by the Senate, with
459	459	amendments, on May 27, 2009, by the following vote: Yeas 31, Nays
460	460	0.
461	461	______________________________
462	462	Secretary of the Senate
463	463	APPROVED: __________________
464	464	Date
465	465	__________________
466	466	Governor