Texas Senate Bill SB485

Texas 2009 - 81st Regular

• Out of Senate Committee: 4/29/09
• Voted on by Senate: 5/5/09

Caption

Relating to medical loss ratios of preferred provider benefit plan issuers.

Impact

If enacted, the bill will directly affect health insurance issuers providing medical or surgical benefits. This change would enforce stricter reporting requirements for medical loss ratios, compelling issuers to disclose their financial dealings more transparently. Additionally, it empowers the Texas Insurance Commissioner to review these ratios and impose corrective actions if an issuer's ratio falls below an established threshold, promoting a more consumer-focused insurance landscape.

Summary

SB485 focuses on establishing minimum medical loss ratios for health benefit plan issuers in Texas. The bill introduces a new chapter to the Insurance Code that mandates health benefit plan insurers to maintain a medical loss ratio that ensures a specified percentage of premiums is spent on healthcare services rather than administrative costs and profits. The intention is to enhance accountability among insurers and ensure that consumers receive value for their premium payments by requiring that a significant portion be allocated towards medical care.

Contention

The implementation of SB485 may spark debate concerning its regulatory implications on the health insurance market. Proponents argue that it will protect consumers by ensuring that more premium dollars go towards actual healthcare, thereby improving patient outcomes and reducing unnecessary administrative overhead. Conversely, opponents might argue that the increased regulatory burden could lead to higher premiums or reduced choices in the market as insurers adjust to the new requirements. Additionally, concerns about potential impacts on smaller insurance providers who might struggle to adapt to these standards could arise.