Texas 2009 - 81st Regular

Texas House Bill HB4290 Compare Versions

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1	1	H.B. No. 4290
2	2
3	3
4	4	AN ACT
5	5	relating to retrospective utilization review and utilization
6	6	review to determine the experimental or investigational nature of a
7	7	health care service.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Sections 1305.004(a)(1), (10), and (23),
10	10	Insurance Code, are amended to read as follows:
11	11	(1) "Adverse determination" has the meaning assigned
12	12	by Chapter 4201 [means a determination, made through utilization
13	13	review or retrospective review, that the health care services
14	14	furnished or proposed to be furnished to an employee are not
15	15	medically necessary or appropriate].
16	16	(10) "Independent review" means a system for final
17	17	administrative review by an independent review organization of the
18	18	medical necessity and appropriateness, or the experimental or
19	19	investigational nature, of health care services being provided,
20	20	proposed to be provided, or that have been provided to an employee.
21	21	(23) "Screening criteria" means the written policies,
22	22	medical protocols, and treatment guidelines used by an insurance
23	23	carrier or a network as part of utilization review [or
24	24	retrospective review].
25	25	SECTION 2. Section 1305.053, Insurance Code, is amended to
26	26	read as follows:
27	27	Sec. 1305.053. CONTENTS OF APPLICATION. Each certificate
28	28	application must include:
29	29	(1) a description or a copy of the applicant's basic
30	30	organizational structure documents and other related documents,
31	31	including organizational charts or lists that show:
32	32	(A) the relationships and contracts between the
33	33	applicant and any affiliates of the applicant; and
34	34	(B) the internal organizational structure of the
35	35	applicant's management and administrative staff;
36	36	(2) biographical information regarding each person
37	37	who governs or manages the affairs of the applicant, accompanied by
38	38	information sufficient to allow the commissioner to determine the
39	39	competence, fitness, and reputation of each officer or director of
40	40	the applicant or other person having control of the applicant;
41	41	(3) a copy of the form of any contract between the
42	42	applicant and any provider or group of providers, and with any third
43	43	party performing services on behalf of the applicant under
44	44	Subchapter D;
45	45	(4) a copy of the form of each contract with an
46	46	insurance carrier, as described by Section 1305.154;
47	47	(5) a financial statement, current as of the date of
48	48	the application, that is prepared using generally accepted
49	49	accounting practices and includes:
50	50	(A) a balance sheet that reflects a solvent
51	51	financial position;
52	52	(B) an income statement;
53	53	(C) a cash flow statement; and
54	54	(D) the sources and uses of all funds;
55	55	(6) a statement acknowledging that lawful process in a
56	56	legal action or proceeding against the network on a cause of action
57	57	arising in this state is valid if served in the manner provided by
58	58	Chapter 804 for a domestic company;
59	59	(7) a description and a map of the applicant's service
60	60	area or areas, with key and scale, that identifies each county or
61	61	part of a county to be served;
62	62	(8) a description of programs and procedures to be
63	63	utilized, including:
64	64	(A) a complaint system, as required under
65	65	Subchapter I;
66	66	(B) a quality improvement program, as required
67	67	under Subchapter G; and
68	68	(C) the utilization review program [and
69	69	retrospective review programs] described in Subchapter H;
70	70	(9) a list of all contracted network providers that
71	71	demonstrates the adequacy of the network to provide comprehensive
72	72	health care services sufficient to serve the population of injured
73	73	employees within the service area and maps that demonstrate that
74	74	the access and availability standards under Subchapter G are met;
75	75	and
76	76	(10) any other information that the commissioner
77	77	requires by rule to implement this chapter.
78	78	SECTION 3. Section 1305.154(c), Insurance Code, is amended
79	79	to read as follows:
80	80	(c) A network's contract with a carrier must include:
81	81	(1) a description of the functions that the carrier
82	82	delegates to the network, consistent with the requirements of
83	83	Subsection (b), and the reporting requirements for each function;
84	84	(2) a statement that the network and any management
85	85	contractor or third party to which the network delegates a function
86	86	will perform all delegated functions in full compliance with all
87	87	requirements of this chapter, the Texas Workers' Compensation Act,
88	88	and rules of the commissioner or the commissioner of workers'
89	89	compensation;
90	90	(3) a provision that the contract:
91	91	(A) may not be terminated without cause by either
92	92	party without 90 days' prior written notice; and
93	93	(B) must be terminated immediately if cause
94	94	exists;
95	95	(4) a hold-harmless provision stating that the
96	96	network, a management contractor, a third party to which the
97	97	network delegates a function, and the network's contracted
98	98	providers are prohibited from billing or attempting to collect any
99	99	amounts from employees for health care services under any
100	100	circumstances, including the insolvency of the carrier or the
101	101	network, except as provided by Section 1305.451(b)(6);
102	102	(5) a statement that the carrier retains ultimate
103	103	responsibility for ensuring that all delegated functions and all
104	104	management contractor functions are performed in accordance with
105	105	applicable statutes and rules and that the contract may not be
106	106	construed to limit in any way the carrier's responsibility,
107	107	including financial responsibility, to comply with all statutory
108	108	and regulatory requirements;
109	109	(6) a statement that the network's role is to provide
110	110	the services described under Subsection (b) as well as any other
111	111	services or functions delegated by the carrier, including functions
112	112	delegated to a management contractor, subject to the carrier's
113	113	oversight and monitoring of the network's performance;
114	114	(7) a requirement that the network provide the
115	115	carrier, at least monthly and in a form usable for audit purposes,
116	116	the data necessary for the carrier to comply with reporting
117	117	requirements of the department and the division of workers'
118	118	compensation with respect to any services provided under the
119	119	contract, as determined by commissioner rules;
120	120	(8) a requirement that the carrier, the network, any
121	121	management contractor, and any third party to which the network
122	122	delegates a function comply with the data reporting requirements of
123	123	the Texas Workers' Compensation Act and rules of the commissioner
124	124	of workers' compensation;
125	125	(9) a contingency plan under which the carrier would,
126	126	in the event of termination of the contract or a failure to perform,
127	127	reassume one or more functions of the network under the contract,
128	128	including functions related to:
129	129	(A) payments to providers and notification to
130	130	employees;
131	131	(B) quality of care;
132	132	(C) utilization review;
133	133	[(D) retrospective review;] and
134	134	(D) [(E)] continuity of care, including a plan
135	135	for identifying and transitioning employees to new providers;
136	136	(10) a provision that requires that any agreement by
137	137	which the network delegates any function to a management contractor
138	138	or any third party be in writing, and that such an agreement require
139	139	the delegated third party or management contractor to be subject to
140	140	all the requirements of this subchapter;
141	141	(11) a provision that requires the network to provide
142	142	to the department the license number of a management contractor or
143	143	any delegated third party who performs a function that requires a
144	144	license as a utilization review agent under Chapter 4201 or any
145	145	other license under this code or another insurance law of this
146	146	state;
147	147	(12) an acknowledgment that:
148	148	(A) any management contractor or third party to
149	149	whom the network delegates a function must perform in compliance
150	150	with this chapter and other applicable statutes and rules, and that
151	151	the management contractor or third party is subject to the
152	152	carrier's and the network's oversight and monitoring of its
153	153	performance; and
154	154	(B) if the management contractor or the third
155	155	party fails to meet monitoring standards established to ensure that
156	156	functions delegated to the management contractor or the third party
157	157	under the delegation contract are in full compliance with all
158	158	statutory and regulatory requirements, the carrier or the network
159	159	may cancel the delegation of one or more delegated functions;
160	160	(13) a requirement that the network and any management
161	161	contractor or third party to which the network delegates a function
162	162	provide all necessary information to allow the carrier to provide
163	163	information to employees as required by Section 1305.451; and
164	164	(14) a provision that requires the network, in
165	165	contracting with a third party directly or through another third
166	166	party, to require the third party to permit the commissioner to
167	167	examine at any time any information the commissioner believes is
168	168	relevant to the third party's financial condition or the ability of
169	169	the network to meet the network's responsibilities in connection
170	170	with any function the third party performs or has been delegated.
171	171	SECTION 4. The heading to Subchapter H, Chapter 1305,
172	172	Insurance Code, is amended to read as follows:
173	173	SUBCHAPTER H. UTILIZATION REVIEW[; RETROSPECTIVE REVIEW]
174	174	SECTION 5. Section 1305.351, Insurance Code, is amended to
175	175	read as follows:
176	176	Sec. 1305.351. UTILIZATION REVIEW [AND RETROSPECTIVE
177	177	REVIEW] IN NETWORK. (a) The requirements of Chapter 4201 apply to
178	178	utilization review conducted in relation to claims in a workers'
179	179	compensation health care network. In the event of a conflict
180	180	between Chapter 4201 and this chapter, this chapter controls.
181	181	(b) Any screening criteria used for utilization review [or
182	182	retrospective review] related to a workers' compensation health
183	183	care network must be consistent with the network's treatment
184	184	guidelines.
185	185	(c) The preauthorization requirements of Section 413.014,
186	186	Labor Code, and commissioner of workers' compensation rules adopted
187	187	under that section, do not apply to health care provided through a
188	188	workers' compensation network. If a network or carrier uses a
189	189	preauthorization process within a network, the requirements of this
190	190	subchapter and commissioner rules apply. A network or an insurance
191	191	carrier may not require preauthorization of treatments and services
192	192	for a medical emergency.
193	193	(d) Notwithstanding Section 4201.152, a utilization review
194	194	agent or an insurance carrier that uses doctors to perform reviews
195	195	of health care services provided under this chapter, including
196	196	utilization review [and retrospective review], or peer reviews
197	197	under Section 408.0231(g), Labor Code, may only use doctors
198	198	licensed to practice in this state.
199	199	SECTION 6. Section 1305.353(a), Insurance Code, is amended
200	200	to read as follows:
201	201	(a) The entity performing utilization review [or
202	202	retrospective review] shall notify the employee or the employee's
203	203	representative, if any, and the requesting provider of a
204	204	determination made in a utilization review [or retrospective
205	205	review].
206	206	SECTION 7. Sections 4201.002(1) and (13), Insurance Code,
207	207	are amended to read as follows:
208	208	(1) "Adverse determination" means a determination by a
209	209	utilization review agent that health care services provided or
210	210	proposed to be provided to a patient are not medically necessary or
211	211	are experimental or investigational.
212	212	(13) "Utilization review" includes [means] a system
213	213	for prospective, [or] concurrent, or retrospective review of the
214	214	medical necessity and appropriateness of health care services and a
215	215	system for prospective, concurrent, or retrospective review to
216	216	determine the experimental or investigational nature of health care
217	217	services [being provided or proposed to be provided to an
218	218	individual in this state]. The term does not include a review in
219	219	response to an elective request for clarification of coverage.
220	220	SECTION 8. Section 4201.051, Insurance Code, is amended to
221	221	read as follows:
222	222	Sec. 4201.051. PERSONS PROVIDING INFORMATION ABOUT SCOPE OF
223	223	COVERAGE OR BENEFITS. This chapter does not apply to a person who:
224	224	(1) provides information to an enrollee about scope of
225	225	coverage or benefits provided under a health insurance policy or
226	226	health benefit plan; and
227	227	(2) does not determine whether a particular health
228	228	care service provided or to be provided to an enrollee is:
229	229	(A) medically necessary or appropriate; or
230	230	(B) experimental or investigational.
231	231	SECTION 9. Section 4201.206, Insurance Code, is amended to
232	232	read as follows:
233	233	Sec. 4201.206. OPPORTUNITY TO DISCUSS TREATMENT BEFORE
234	234	ADVERSE DETERMINATION. Subject to the notice requirements of
235	235	Subchapter G, before an adverse determination is issued by a
236	236	utilization review agent who questions the medical necessity or
237	237	appropriateness, or the experimental or investigational nature, of
238	238	a health care service [issues an adverse determination], the agent
239	239	shall provide the health care provider who ordered the service a
240	240	reasonable opportunity to discuss with a physician the patient's
241	241	treatment plan and the clinical basis for the agent's
242	242	determination.
243	243	SECTION 10. Subchapter G, Chapter 4201, Insurance Code, is
244	244	amended by adding Section 4201.305 to read as follows:
245	245	Sec. 4201.305. NOTICE OF ADVERSE DETERMINATION FOR
246	246	RETROSPECTIVE UTILIZATION REVIEW. (a) Notwithstanding Sections
247	247	4201.302 and 4201.304, if a retrospective utilization review is
248	248	conducted, the utilization review agent shall provide notice of an
249	249	adverse determination under the retrospective utilization review
250	250	in writing to the provider of record and the patient within a
251	251	reasonable period, but not later than 30 days after the date on
252	252	which the claim is received.
253	253	(b) The period under Subsection (a) may be extended once by
254	254	the utilization review agent for a period not to exceed 15 days, if
255	255	the utilization review agent:
256	256	(1) determines that an extension is necessary due to
257	257	matters beyond the utilization review agent's control; and
258	258	(2) notifies the provider of record and the patient
259	259	before the expiration of the initial 30-day period of the
260	260	circumstances requiring the extension and the date by which the
261	261	utilization review agent expects to make a determination.
262	262	(c) If the extension under Subsection (b) is required
263	263	because of the failure of the provider of record or the patient to
264	264	submit information necessary to reach a determination on the
265	265	request, the notice of extension must:
266	266	(1) specifically describe the required information
267	267	necessary to complete the request; and
268	268	(2) give the provider of record and the patient at
269	269	least 45 days from the date of receipt of the notice of extension to
270	270	provide the specified information.
271	271	(d) If the period for making the determination under this
272	272	section is extended because of the failure of the provider of record
273	273	or the patient to submit the information necessary to make the
274	274	determination, the period for making the determination is tolled
275	275	from the date on which the utilization review agent sends the
276	276	notification of the extension to the provider of record or the
277	277	patient until the earlier of:
278	278	(1) the date on which the provider of record or the
279	279	patient responds to the request for additional information; or
280	280	(2) the date by which the specified information was to
281	281	have been submitted.
282	282	(e) If the periods for retrospective utilization review
283	283	provided by this section conflict with the time limits concerning
284	284	or related to payment of claims established under Subchapter J,
285	285	Chapter 843, the time limits established under Subchapter J,
286	286	Chapter 843, control.
287	287	(f) If the periods for retrospective utilization review
288	288	provided by this section conflict with the time limits concerning
289	289	or related to payment of claims established under Subchapters C and
290	290	C-1, Chapter 1301, the time limits established under Subchapters C
291	291	and C-1, Chapter 1301, control.
292	292	(g) If the periods for retrospective utilization review
293	293	provided by this section conflict with the time limits concerning
294	294	or related to payment of claims established under Section 408.027,
295	295	Labor Code, the time limits established under Section 408.027,
296	296	Labor Code, control.
297	297	SECTION 11. Section 4201.401, Insurance Code, is amended by
298	298	adding Subsection (c) to read as follows:
299	299	(c) The utilization review agent shall comply with the
300	300	independent review organization's determination regarding the
301	301	experimental or investigational nature of health care items and
302	302	services for an enrollee.
303	303	SECTION 12. Section 4201.456, Insurance Code, is amended to
304	304	read as follows:
305	305	Sec. 4201.456. OPPORTUNITY TO DISCUSS TREATMENT BEFORE
306	306	ADVERSE DETERMINATION. Subject to the notice requirements of
307	307	Subchapter G, before an adverse determination is issued by a
308	308	specialty utilization review agent who questions the medical
309	309	necessity or appropriateness, or the experimental or
310	310	investigational nature, of a health care service [issues an adverse
311	311	determination], the agent shall provide the health care provider
312	312	who ordered the service a reasonable opportunity to discuss the
313	313	patient's treatment plan and the clinical basis for the agent's
314	314	determination with a health care provider who is of the same
315	315	specialty as the agent.
316	316	SECTION 13. Section 401.011(38-a), Labor Code, is amended
317	317	to read as follows:
318	318	(38-a) "Retrospective review" means the utilization
319	319	review process of reviewing the medical necessity and
320	320	reasonableness of health care that has been provided to an injured
321	321	employee [has the meaning assigned by Chapter 1305, Insurance
322	322	Code].
323	323	SECTION 14. Section 408.0043(a), Labor Code, is amended to
324	324	read as follows:
325	325	(a) This section applies to a person, other than a
326	326	chiropractor or a dentist, who performs health care services under
327	327	this title as:
328	328	(1) a doctor performing peer review;
329	329	(2) a doctor performing a utilization review of a
330	330	health care service provided to an injured employee[, including a
331	331	retrospective review];
332	332	(3) a doctor performing an independent review of a
333	333	health care service provided to an injured employee[, including a
334	334	retrospective review];
335	335	(4) a designated doctor;
336	336	(5) a doctor performing a required medical
337	337	examination; or
338	338	(6) a doctor serving as a member of the medical quality
339	339	review panel.
340	340	SECTION 15. Section 408.0044(a), Labor Code, is amended to
341	341	read as follows:
342	342	(a) This section applies to a dentist who performs dental
343	343	services under this title as:
344	344	(1) a doctor performing peer review of dental
345	345	services;
346	346	(2) a doctor performing a utilization review of a
347	347	dental service provided to an injured employee[, including a
348	348	retrospective review];
349	349	(3) a doctor performing an independent review of a
350	350	dental service provided to an injured employee[, including a
351	351	retrospective review]; or
352	352	(4) a doctor performing a required dental examination.
353	353	SECTION 16. Section 408.0045(a), Labor Code, is amended to
354	354	read as follows:
355	355	(a) This section applies to a chiropractor who performs
356	356	chiropractic services under this title as:
357	357	(1) a doctor performing peer review of chiropractic
358	358	services;
359	359	(2) a doctor performing a utilization review of a
360	360	chiropractic service provided to an injured employee[, including a
361	361	retrospective review];
362	362	(3) a doctor performing an independent review of a
363	363	chiropractic service provided to an injured employee[, including a
364	364	retrospective review];
365	365	(4) a designated doctor providing chiropractic
366	366	services;
367	367	(5) a doctor performing a required medical
368	368	examination; or
369	369	(6) a chiropractor serving as a member of the medical
370	370	quality review panel.
371	371	SECTION 17. Section 408.023(h), Labor Code, is amended to
372	372	read as follows:
373	373	(h) Notwithstanding Section 4201.152, Insurance Code, a
374	374	utilization review agent or an insurance carrier that uses doctors
375	375	to perform reviews of health care services provided under this
376	376	subtitle, including utilization review [and retrospective review],
377	377	may only use doctors licensed to practice in this state.
378	378	SECTION 18. Section 413.031(e-3), Labor Code, is amended to
379	379	read as follows:
380	380	(e-3) Notwithstanding Subsections (d) and (e) of this
381	381	section or Chapters 4201 and 4202, Insurance Code, a doctor, other
382	382	than a dentist or a chiropractor, who performs a utilization review
383	383	or an independent review[, including a retrospective review,] of a
384	384	health care service provided to an injured employee is subject to
385	385	Section 408.0043. A dentist who performs a utilization review or an
386	386	independent review[, including a retrospective review,] of a dental
387	387	service provided to an injured employee is subject to Section
388	388	408.0044. A chiropractor who performs a utilization review or an
389	389	independent review[, including a retrospective review,] of a
390	390	chiropractic service provided to an injured employee is subject to
391	391	Section 408.0045.
392	392	SECTION 19. The following laws are repealed:
393	393	(1) Section 1305.004(a)(21), Insurance Code;
394	394	(2) Section 1305.352, Insurance Code; and
395	395	(3) Subchapter K, Chapter 4201, Insurance Code.
396	396	SECTION 20. This Act applies only to a health benefit plan
397	397	delivered, issued for delivery, or renewed on or after January 1,
398	398	2010. A health benefit plan delivered, issued for delivery, or
399	399	renewed before January 1, 2010, is governed by the law as it existed
400	400	immediately before the effective date of this Act, and that law is
401	401	continued in effect for that purpose.
402	402	SECTION 21. This Act takes effect September 1, 2009.
403	403	______________________________ ______________________________
404	404	President of the Senate Speaker of the House
405	405	I certify that H.B. No. 4290 was passed by the House on April
406	406	30, 2009, by the following vote: Yeas 144, Nays 0, 1 present, not
407	407	voting; and that the House concurred in Senate amendments to H.B.
408	408	No. 4290 on May 29, 2009, by the following vote: Yeas 144, Nays 0,
409	409	1 present, not voting.
410	410	______________________________
411	411	Chief Clerk of the House
412	412	I certify that H.B. No. 4290 was passed by the Senate, with
413	413	amendments, on May 26, 2009, by the following vote: Yeas 31, Nays
414	414	0.
415	415	______________________________
416	416	Secretary of the Senate
417	417	APPROVED: __________________
418	418	Date
419	419	__________________
420	420	Governor