83R9822 PMO-F
By: Turner of Tarrant H.B. No. 2645
A BILL TO BE ENTITLED
AN ACT
relating to certification and operation of independent review
organizations.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 4202.002, Insurance Code, is amended by
amending Subsection (c) and adding Subsections (d) and (e) to read
as follows:
(c) In addition to the standards described by Subsection
(b), the commissioner shall adopt standards and rules that:
(1) prohibit:
(A) more than one independent review
organization from operating out of the same office or other
facility;
(B) an individual or entity from owning more than
one independent review organization;
(C) an individual from owning stock in or serving
on the board of more than one independent review organization;
(D) an individual who has served on the board of
an independent review organization whose certification was revoked
for cause from serving on the board of another independent review
organization before the fifth anniversary of the date on which the
revocation occurred; and
(E) [an attorney who is, or has in the past served
as, the registered agent for an independent review organization
from representing the independent review organization in legal
proceedings; and
[(F)] an independent review organization from:
(i) publicly disclosing [confidential]
patient information protected by the Health Insurance Portability
and Accountability Act of 1996 (42 U.S.C. Section 1320d et seq.); or
(ii) transmitting the information to a
subcontractor involved in the independent review process that has
not signed an agreement similar to the business associate agreement
required by regulations adopted under the Health Insurance
Portability and Accountability Act of 1996 (42 U.S.C. Section 1320d
et seq.) [, except to a provider who is under contract to perform
the review]; and
(2) require:
(A) an independent review organization to:
(i) maintain a physical address and a
mailing address in this state;
(ii) be incorporated in this state;
(iii) be in good standing with the
comptroller; and
(iv) be certified under this chapter [be
based and certified in this state and to locate the organization's
primary offices in this state];
(B) an independent review organization to
[voluntarily] surrender the organization's certification [while
the organization is under investigation or] as part of an agreed
order; and
(C) an independent review organization to:
(i) notify the department of an agreement
to sell the organization or shares in the organization;
(ii) not less than the 45th day before the
date of the sale, submit the name of the purchaser and a complete
and legible set of fingerprints for each officer of the purchaser
and for each owner or shareholder of the purchaser or, if the
purchaser is publicly held, each owner or shareholder described by
Section 4202.004(a)(1), and any additional information necessary
to comply with Section 4202.004(f); and
(iii) complete the transfer of ownership
after the department has sent written confirmation that the
requirements of Section 4202.004(f) have been satisfied [apply for
and receive a new certification after the organization is sold to a
new owner].
(d) Standards to ensure the confidentiality of medical
records transmitted to an independent review organization under
Subsection (b)(2) must require organizations and utilization
review agents to transmit and store records in compliance with the
Health Insurance Portability and Accountability Act of 1996 (42
U.S.C. Section 1320d et seq.) and the regulations and standards
adopted under that Act.
(e) The commissioner shall adopt standards requiring that:
(1) on application for certification, an officer of
the organization attest that the office is located at a physical
address;
(2) the office be equipped with a computer system
capable of:
(A) processing requests for independent review;
and
(B) accessing all electronic records related to
the review and the independent review process;
(3) all records only be maintained electronically; and
(4) in the case of an office located in a residence,
the working office be located in a room set aside for business
purposes.
SECTION 2. Section 4202.003, Insurance Code, is amended to
read as follows:
Sec. 4202.003. REQUIREMENTS REGARDING TIMELINESS OF
DETERMINATION. The standards adopted under Section 4202.002 must
require each independent review organization to make the
organization's determination:
(1) for a life-threatening condition as defined by
Section 4201.002, not later than the earlier of[:
[(A)] the fifth day after the date the
organization receives the information necessary to make the
determination[;] or, with respect to:
(A) a review of a health care service provided to
a person eligible for workers' compensation medical benefits,
[(B)] the eighth day after the date the organization receives the
request that the determination be made; or
(B) a review of a health care service other than a
service described by Paragraph (A), the fourth day after the date
the organization receives the request that the determination be
made; or [and]
(2) for a condition other than a life-threatening
condition, not later than [the earlier of:
[(A) the 15th day after the date the organization
receives the information necessary to make the determination; or
[(B)] the 20th day after the date the
organization receives all information necessary to make the
[request that the] determination [be made].
SECTION 3. Section 4202.004, Insurance Code, is amended to
read as follows:
Sec. 4202.004. CERTIFICATION. (a) To be certified as an
independent review organization under this chapter, an
organization must submit to the commissioner an application in the
form required by the commissioner. The application must include:
(1) for an applicant that is publicly held, the name of
each shareholder or owner of more than five percent of any of the
applicant's stock or options;
(2) the name of any holder of the applicant's bonds or
notes that exceed $100,000;
(3) the name and type of business of each corporation
or other organization described by Subdivision (4) that the
applicant controls or is affiliated with and the nature and extent
of the control or affiliation;
(4) the name and a biographical sketch of each
director, officer, and executive of the applicant and of any entity
listed under Subdivision (3) and a description of any relationship
the applicant or the named individual has with:
(A) a health benefit plan;
(B) a health maintenance organization;
(C) an insurer;
(D) a utilization review agent;
(E) a nonprofit health corporation;
(F) a payor;
(G) a health care provider; or
(H) a group representing any of the entities
described by Paragraphs (A) through (G);
(5) the percentage of the applicant's revenues that
are anticipated to be derived from independent reviews conducted
under Subchapter I, Chapter 4201;
(6) a description of:
(A) the areas of expertise of the physicians or
other health care providers making review determinations for the
applicant;
(B) the procedures used by the applicant to
verify physician and provider credentials, including the computer
processes, electronic databases, and records, if any, used; and
(C) the software used by the credentialing
manager for managing the processes, databases, and records
described by Paragraph (B); [and]
(7) the procedures to be used by the applicant in
making independent review determinations under Subchapter I,
Chapter 4201; and
(8) a description of the applicant's use of
communications, records, and computer processes to manage the
independent review process.
(b) The commissioner shall establish and implement separate
certifications for independent review of health care services
provided to persons eligible for workers' compensation medical
benefits and other health care services after considering:
(1) certification processes available in the private
sector for members of a national association of independent review
organizations with not less than 10 members; and
(2) the advice of the advisory group established under
Section 4202.011.
(c) An applicant may apply for certifications for
independent review of health care services provided to persons
eligible for workers' compensation medical benefits and other
health care services.
(d) Notwithstanding any other provision of this chapter,
the commissioner by rule may require that a review of health care
services provided to persons eligible for workers' compensation
medical benefits and other health care services or exclusively
other health care services be in compliance with the requirements
of the Uniform Health Carrier External Review Act adopted by the
National Association of Insurance Commissioners.
(e) The department shall make available to applicants
separate applications for certification to review health care
services provided to persons eligible for workers' compensation
medical benefits and other health care services.
(f) The commissioner shall require that each officer of the
applicant and each owner or shareholder of the applicant or, if the
purchaser is publicly held, each owner or shareholder described by
Subsection (a)(1), submit a complete and legible set of
fingerprints to the department for the purpose of obtaining
criminal history record information from the Department of Public
Safety and the Federal Bureau of Investigation. The department
shall conduct a criminal history check of each applicant using
information:
(1) provided under this section; and
(2) made available to the department by the Department
of Public Safety, the Federal Bureau of Investigation, and any
other criminal justice agency under Chapter 411, Government Code.
(g) An application for certification for review of health
care services other than health care services provided to persons
eligible for workers' compensation medical benefits exclusively
must require an organization that is certified by an association
described by Subsection (b)(1) to provide the department evidence
of the certification and all of the information submitted to the
association to obtain the certification. An independent review
organization that is certified by or has applied for certification
by an association described by Subsection (b)(1) may request that
the department expedite the application process.
(h) Certification must be renewed biennially.
SECTION 4. Section 4202.005, Insurance Code, is amended to
read as follows:
Sec. 4202.005. PERIODIC REPORTING OF INFORMATION; BIENNIAL
[ANNUAL] DESIGNATION; UPDATES AND INSPECTION. (a) An independent
review organization shall biennially [annually] submit the
information required in an application for certification under
Section 4202.004. Anytime there is a material change in the
information the organization included in the application, the
organization shall submit updated information to the commissioner.
(b) The commissioner shall designate biennially [annually]
each organization that meets the standards for an independent
review organization adopted under Section 4202.002.
(c) Information regarding a material change must be
submitted on a form adopted by the commissioner not later than the
30th day after the date the material change occurs. If the material
change is a relocation of the organization:
(1) the organization must inform the department of a
range of dates the location is available for inspection by the
department; and
(2) on request of the department, an officer shall
attend the inspection.
SECTION 5. Chapter 4202, Insurance Code, is amended by
adding Sections 4202.011 and 4202.012 to read as follows:
Sec. 4202.011. ADVISORY GROUP. (a) The commissioner shall
establish a group to advise the department and make recommendations
approved by a majority vote of the group related to the efficiency
of utilization review and independent review generally and the
efficiency of the review of health care services.
(b) The commissioner shall appoint as a member of the group
a department employee to report to the commissioner group
recommendations and policies. The commissioner shall appoint as
members of the group individuals who have applied for membership,
including:
(1) an officer of an independent review organization
certified under this chapter;
(2) an officer of a utilization review organization
certified under Chapter 4201;
(3) two officers or representatives of associations of
independent review organizations:
(A) with not less than 10 members that are
certified under this chapter; or
(B) that have been in existence for not less than
three years;
(4) an officer or representative of an association of
physicians with knowledge of and interest in the independent review
process;
(5) an officer or representative of an association of
insurance carriers with knowledge of and interest in the
independent review process; and
(6) an officer or representative of a patient advocacy
association with knowledge of and interest in the independent
review process.
(c) A recommendation of the advisory group does not bind the
commissioner.
(d) Members of the group serve two-year terms. The
commissioner shall appoint a replacement member in the event of a
vacancy to serve the remainder of the unexpired term.
(e) The commissioner shall designate one member to serve as
presiding member of the group. A member may serve more than one
term as presiding member.
(f) The advisory group shall meet annually and otherwise at
the request of the presiding member or the commissioner. The group
shall make recommendations at least annually to the commissioner.
(g) A member of the group may not receive compensation for
service as a group member.
Sec. 4202.012. REFERRAL. The commissioner by rule shall
require referral to an independent review organization in
appropriate dispute resolution processes involving health care
services.
SECTION 6. Chapter 4202, Insurance Code, as amended by this
Act, applies only to an independent review organization that
applies for an initial certification or renewal certification on or
after January 1, 2014. An organization certified before that date
is governed by the law as it existed immediately before January 1,
2014, and that law is continued in effect for that purpose.
SECTION 7. This Act takes effect September 1, 2013.