Texas 2011 - 82nd Regular

Texas House Bill HB3017 Compare Versions

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1	1	By: Smithee (Senate Sponsor - Duncan) H.B. No. 3017
2	2	(In the Senate - Received from the House May 11, 2011;
3	3	May 11, 2011, read first time and referred to Committee on State
4	4	Affairs; May 17, 2011, reported favorably by the following vote:
5	5	Yeas 9, Nays 0; May 17, 2011, sent to printer.)
6	6
7	7
8	8	A BILL TO BE ENTITLED
9	9	AN ACT
10	10	relating to the prohibited use of discretionary clauses in certain
11	11	health maintenance organization and insurance contracts.
12	12	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
13	13	SECTION 1. Subchapter B, Chapter 1271, Insurance Code, is
14	14	amended by adding Section 1271.057 to read as follows:
15	15	Sec. 1271.057. DISCRETIONARY CLAUSES PROHIBITED. (a) An
16	16	evidence of coverage may not contain a discretionary clause
17	17	provision.
18	18	(b) A discretionary clause provision includes a provision
19	19	that:
20	20	(1) purports or acts to bind the enrollee to, or grant
21	21	deference in subsequent proceedings to, adverse eligibility or
22	22	benefit decisions or interpretations of the evidence of coverage by
23	23	the health maintenance organization; or
24	24	(2) specifies:
25	25	(A) that an enrollee or other claimant may not
26	26	contest or appeal a denial of a benefit;
27	27	(B) that the health maintenance organization's
28	28	interpretation of the terms of an evidence of coverage or other form
29	29	or its decision to deny coverage or the amount of benefits is
30	30	binding on an enrollee or other claimant;
31	31	(C) that in an appeal, the health maintenance
32	32	organization's decision-making power as to the interpretation of
33	33	the terms of an evidence of coverage or other form, or as to
34	34	coverage, is binding; or
35	35	(D) a standard of review in any appeal process
36	36	that gives deference to the original benefit decision or provides
37	37	standards of interpretation or review that are inconsistent with
38	38	the laws of this state, including the common law.
39	39	SECTION 2. Subchapter B, Chapter 1701, Insurance Code, is
40	40	amended by adding Section 1701.062 to read as follows:
41	41	Sec. 1701.062. DISCRETIONARY CLAUSES PROHIBITED. (a) An
42	42	insurer may not use a document described by Section 1701.002 in this
43	43	state if the document contains a discretionary clause.
44	44	(b) A discretionary clause includes a provision that:
45	45	(1) purports or acts to bind the claimant to, or grant
46	46	deference in subsequent proceedings to, adverse eligibility or
47	47	claim decisions or policy interpretations by the insurer; or
48	48	(2) specifies:
49	49	(A) that a policyholder or other claimant may not
50	50	contest or appeal a denial of a claim;
51	51	(B) that the insurer's interpretation of the
52	52	terms of a document or decision to deny coverage or the amount of
53	53	benefits is binding upon a policyholder or other claimant;
54	54	(C) that in an appeal, the insurer's decision
55	55	about or interpretation of the terms of a document or coverage is
56	56	binding; or
57	57	(D) a standard of review in any appeal process
58	58	that gives deference to the original claim decision or provides
59	59	standards of interpretation or review that are inconsistent with
60	60	the laws of this state, including the common law.
61	61	SECTION 3. The change in law made by this Act applies only
62	62	to a document or evidence of coverage that is delivered, issued for
63	63	delivery, or renewed on or after January 1, 2012. A document or
64	64	evidence of coverage that is delivered, issued for delivery, or
65	65	renewed before January 1, 2012, is governed by the law in effect
66	66	immediately before the effective date of this Act, and that law is
67	67	continued in effect for that purpose.
68	68	SECTION 4. This Act takes effect immediately if it receives
69	69	a vote of two-thirds of all the members elected to each house, as
70	70	provided by Section 39, Article III, Texas Constitution. If this
71	71	Act does not receive the vote necessary for immediate effect, this
72	72	Act takes effect September 1, 2011.
73	73	* * * * *