82R5784 AJA-F
By: Van de Putte S.B. No. 1614
A BILL TO BE ENTITLED
AN ACT
relating to payment of and disclosures related to certain
ambulatory surgical center charges.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 1301, Insurance Code, is amended by
adding Subchapter F to read as follows:
SUBCHAPTER F. PAYMENT OF OUT-OF-NETWORK AMBULATORY SURGICAL CENTER
CHARGES
Sec. 1301.251. DEFINITIONS. In this subchapter:
(1) "Ambulatory surgical center" means a facility
licensed under Chapter 243, Health and Safety Code.
(2) "Database provider" means a database provider
certified by the department under Section 1301.256.
(3) "Out-of-network ambulatory surgical center," with
respect to a preferred provider benefit plan, means an ambulatory
surgical center that is not a preferred provider of the plan.
(4) "Purchaser" means an insured under a preferred
provider benefit plan, regardless of whether the insured pays any
part of the insured's premium, and a sponsor of the preferred
provider benefit plan, regardless of whether the sponsor pays any
part of an insured's premium.
(5) "Usual and customary charge" means a charge for a
service that is not higher than the 75th percentile of the charges
for that service reported to a database provider by ambulatory
surgical centers in the same Medicare region, computed after
excluding:
(A) charges discounted under a governmental or
nongovernmental health benefit plan; and
(B) the top and bottom 10 percent of reported
charges for that service for the region that are not discounted
under a health benefit plan.
Sec. 1301.252. APPLICABILITY OF SUBCHAPTER. This
subchapter applies only to an insurer that issues a preferred
provider benefit plan that provides benefits for services provided
by out-of-network ambulatory surgical centers.
Sec. 1301.253. PAYMENT OF CERTAIN OUT-OF-NETWORK
AMBULATORY SURGICAL CENTERS. (a) An insurer must use a
charge-based methodology that complies with this subchapter for
computing a payment for a service provided by an out-of-network
ambulatory surgical center if the ambulatory surgical center
submits a claim for payment that includes a certification of the
maximum usual and customary charge for the service determined by a
database provider.
(b) If an out-of-network ambulatory surgical center submits
a claim for payment of a charge that includes a certification from a
database provider indicating that the billed charge is a usual and
customary charge, the insurer shall pay the billed charge minus any
portion of the charge that is the insured's responsibility under
the preferred provider benefit plan.
(c) If an out-of-network ambulatory surgical center submits
a claim for payment of a charge that includes a certification from a
database provider indicating that the billed charge is higher than
the maximum usual and customary charge, the insurer shall pay the
billed charge minus any portion of the charge that is the insured's
responsibility under the preferred provider benefit plan if the
billed charge is justifiable considering special circumstances
under which the services are provided. If the charge is not
justifiable considering special circumstances under which the
services are provided, the insurer shall pay the maximum usual and
customary charge minus any portion of the charge that is the
insured's responsibility under the preferred provider benefit
plan.
Sec. 1301.254. PROMPT PAYMENT OF USUAL AND CUSTOMARY
CHARGE. If an out-of-network ambulatory surgical center submits a
claim for payment of a charge that includes a certification from a
database provider indicating that the charge is a usual and
customary charge and the claim for payment is otherwise made in
accordance with Subchapter C:
(1) the claim must be paid in accordance with
Subchapter C as if the ambulatory surgical center were a preferred
provider; and
(2) if the insurer fails to pay the claim in accordance
with this section:
(A) the ambulatory surgical center is entitled to
any remedy under this chapter to which a preferred provider would be
entitled for the insurer's failure to pay the claim in accordance
with Subchapter C; and
(B) the insurer is subject to any penalty or
disciplinary action under this code to which the insurer would be
subject for the insurer's failure to pay the claim in accordance
with Subchapter C.
Sec. 1301.255. REQUIRED CONTRACT TERMS. The language used
in the preferred provider benefit plan policy, certificate, or
contract to describe the benefit provided under the preferred
provider benefit plan for services provided by an out-of-network
ambulatory surgical center:
(1) must:
(A) provide that payment to an out-of-network
ambulatory surgical center will be computed based on the billed
charge if the charge:
(i) is a usual and customary charge; or
(ii) is not a usual and customary charge but
is justifiable considering special circumstances of the services
provided;
(B) define "usual and customary charge" as that
term is defined by Section 1301.251; and
(C) incorporate into the definition of "usual and
customary charge" the definition of "database provider" assigned by
Section 1301.251; and
(2) may not add or subtract language from a definition
required by this section.
Sec. 1301.256. CERTIFICATION AND QUALIFICATIONS OF
DATABASE PROVIDER AND DATABASE. (a) A database provider that is
used to determine usual and customary charges for the purposes of
this subchapter must be certified by the department. The
department may certify a database provider under this subchapter
only if the department determines that the database provider and
the database used by the provider for the purposes of this
subchapter comply with this section.
(b) A database provider must be an entity that:
(1) has been operating and based in this state for at
least 10 years;
(2) has compiled out-of-network charges for
ambulatory surgical centers in this state for at least seven years;
(3) maintains a database with content that complies
with this section;
(4) maintains an active Internet website accessible to
all ambulatory surgical centers subscribing to the database and to
the public; and
(5) demonstrates an ability to:
(A) maintain a compilation of charge data that is
absent any data required to be excluded under Subsection (e)(1);
and
(B) distinguish charges that are not related to
one another and eliminate irrelevant or erroneous charges from
reported charge information.
(c) The database provider must compute usual and customary
charges for services provided by ambulatory surgical centers in
accordance with this subchapter.
(d) The data in the database must contain out-of-network
charges for:
(1) at least 350,000 out-of-network billed charges
from ambulatory surgical centers in this state; and
(2) ambulatory surgical centers in each Medicare
region in this state.
(e) The data in the database may not:
(1) include:
(A) any data other than out-of-network billed
charges of ambulatory surgical centers in this state;
(B) ambulatory surgical center charges that
reflect payments discounted under governmental or nongovernmental
health benefit plans; or
(C) information that is more than seven years
old; or
(2) exclude charges accompanied by modifiers that
indicate procedures with complications.
(f) An entity may not be certified as a database provider
for the purposes of this subchapter if the entity owns or controls,
or is owned or controlled by, or is an affiliate of, any entity with
a pecuniary interest in the application of the database.
(g) The Internet website required by this section must allow
an individual to determine the maximum usual and customary charge
for a particular service provided by an ambulatory surgical center.
(h) The department shall ensure that:
(1) the data in the database used to compute usual and
customary charges of out-of-network ambulatory surgical centers is
updated regularly to accurately reflect current ambulatory
surgical center retail charges; and
(2) charge information that is more than seven years
old is removed from the database.
(i) The department may charge a fee for certification under
this section in an amount necessary to implement this section.
Sec. 1301.257. PROVISION OF USUAL AND CUSTOMARY CHARGE BY
DATABASE PROVIDER. A database provider must compute the usual and
customary charge for each service for which a billed charge is
submitted to the provider by an ambulatory surgical center that
subscribes to the database and provide the ambulatory surgical
center with a certification of the usual and customary charge that
is sufficient to enable an insurer to whom the ambulatory surgical
center submits a claim for payment to comply with this subchapter.
Sec. 1301.258. DISCLOSURES REGARDING PAYMENT OF
OUT-OF-NETWORK AMBULATORY SURGICAL CENTER. (a) An insurer that
provides benefits under a preferred provider benefit plan for
services provided by out-of-network ambulatory surgical centers
must include in the summary plan description and on an Internet
website maintained by the insurer and disclose to a prospective
purchaser of the preferred provider benefit plan:
(1) the definition of "usual and customary charge"
assigned by Section 1301.251 and a description of how payment to an
out-of-network ambulatory surgical center will be based on the
usual and customary charge where applicable;
(2) the Internet website addresses of each database
provider certified under this subchapter at which a purchaser or
prospective purchaser may access the database or a single website
address at which an updated set of links to the website addresses of
those database providers may be accessed; and
(3) a statement of the possibility that the payment
due under the plan's out-of-network benefit provisions may be lower
than an ambulatory surgical center's billed charge and that the
insured may be responsible for paying the ambulatory surgical
center, in addition to any other cost sharing under the plan, the
difference between the billed charge and the usual and customary
charge computed by a database provider or another justifiable
charge the insurer is obligated to pay the ambulatory surgical
center.
(b) Disclosures under this section must:
(1) be made in language easily understood by
purchasers and prospective purchasers of preferred provider
benefit plans;
(2) be made in a uniform, clearly organized manner;
(3) be of sufficient detail and comprehensiveness as
to provide for full and fair disclosure; and
(4) be updated as necessary to ensure that the
disclosures are accurate.
Sec. 1301.259. ANNUAL ACTUARIAL CERTIFICATION. (a) An
insurer that offers a preferred provider benefit plan that provides
coverage for services provided by out-of-network ambulatory
surgical centers must annually submit to the department a written
certification stating:
(1) the difference in value for a purchaser between:
(A) the coverage without the out-of-network
ambulatory surgical center benefits; and
(B) the coverage with the out-of-network
ambulatory surgical center benefits; and
(2) that the difference between the premium a
purchaser would be charged for the coverage without the
out-of-network ambulatory surgical center benefits and the premium
that a purchaser would be charged for the coverage with the
out-of-network ambulatory surgical center benefits reflects the
difference in value certified under Subdivision (1).
(b) The certification must be made in easily understood
language, in a uniform, clearly organized manner, and be of
sufficient detail and comprehensiveness as to provide for full and
fair disclosure to an average consumer. The difference between the
value of the coverage without the out-of-network ambulatory
surgical center benefits and the coverage with the out-of-network
ambulatory surgical center benefits must be expressed in terms of a
percentage, although use of a percentage alone is not sufficient to
satisfy the requirements of this section.
(c) The certification must be made by an actuary who is
certified by a nationally recognized actuarial certification
organization recognized by the commissioner and who is not
affiliated with the insurer or any of the insurer's affiliates.
(d) An insurer must make the certification required by this
section readily available to the public.
Sec. 1301.260. REMEDIES. (a) A violation of this
subchapter is an unfair and deceptive act or practice under Chapter
541. If the department finds or it is otherwise determined that an
insurer violated this subchapter, the department shall:
(1) take all appropriate corrective action and use any
of the department's other enforcement powers to obtain the
insurer's compliance; and
(2) if the violation results in an insured's use of an
out-of-network ambulatory surgical center, order the insurer to pay
the out-of-network ambulatory surgical center's billed charge as
indicated on the applicable claim form.
(b) The remedies provided by this section are in addition to
remedies available under Section 1301.254 or any other provision of
this code.
Sec. 1301.261. ACTION BY ATTORNEY GENERAL. The attorney
general may, independent of the department, bring an action to
enforce this subchapter.
SECTION 2. Subchapter A, Chapter 243, Health and Safety
Code, is amended by adding Section 243.0105 to read as follows:
Sec. 243.0105. FEE SCHEDULE. (a) An ambulatory surgical
center must maintain a current schedule of retail fees for the
services that the center typically provides.
(b) Before providing an elective service to an insured under
a preferred provider benefit plan authorized under Chapter 1301,
Insurance Code, an ambulatory surgical center that is not a
preferred provider under the plan must provide the insured with:
(1) a copy of the center's most current fee schedule as
it applies to the elective service the center expects to provide to
the insured; and
(2) if applicable, the Internet website address for
the database provider the center uses for the purposes of
certification of usual and customary charges under Subchapter F,
Chapter 1301, Insurance Code.
(c) An ambulatory surgical center must disclose to any
patient or prospective patient a copy of the center's 100 most
commonly provided services by procedure code. The center may make
the disclosure required by this subsection available by hard copy,
electronically, or through an Internet website.
SECTION 3. Subchapter F, Chapter 1301, Insurance Code, as
added by this Act, applies only to charges for services provided to
an insured under an insurance policy, certificate, or contract
delivered, issued for delivery, or renewed on or after January 1,
2012. Charges for services provided to an insured under an
insurance policy, certificate, or contract delivered, issued for
delivery, or renewed before January 1, 2012, are governed by the law
in effect immediately before the effective date of this Act, and
that law is continued in effect for that purpose.
SECTION 4. This Act takes effect September 1, 2011.