84R7389 SCL-F
By: Smithee H.B. No. 1638
A BILL TO BE ENTITLED
AN ACT
relating to nonpreferred provider claims under a preferred provider
benefit plan related to emergency care.
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. NONPREFERRED PROVIDER CLAIMS RELATED TO EMERGENCY
CARE PROVIDED TO INSUREDS; ARBITRATION
Sec. 1301.251. DEFINITIONS. In this subchapter:
(1) "Chief administrative law judge" means the chief
administrative law judge of the State Office of Administrative
Hearings.
(2) "Emergency care" has the meaning assigned by
Section 1301.155.
Sec. 1301.252. APPLICABILITY OF SUBCHAPTER. (a) This
subchapter does not apply to health care services, including
emergency care, in which physician fees are subject to schedules or
other monetary limitations under any other law, including workers'
compensation under Title 5, Labor Code.
(b) This subchapter applies only to emergency care
provided:
(1) to an insured;
(2) within a hospital, freestanding emergency medical
care facility, or similar facility that is a preferred provider;
and
(3) by a facility-based physician or health care
provider who is a nonpreferred provider.
(c) This subchapter does not apply to:
(1) the Employees Retirement System of Texas or
another entity issuing or administering a basic coverage plan under
Chapter 1551;
(2) the Teacher Retirement System of Texas or another
entity issuing or administering a basic plan under Chapter 1575 or a
health coverage plan under Chapter 1579; or
(3) The Texas A&M University System or The University
of Texas System or another entity issuing or administering basic
coverage under Chapter 1601.
Sec. 1301.253. PAYMENT OF NONPREFERRED PROVIDER BILL.
Notwithstanding Section 1301.005 or any other law, an insurer shall
pay a nonpreferred provider a reasonable amount for emergency care
provided by the nonpreferred provider to an insured.
Sec. 1301.254. HOLD HARMLESS FOR INSUREDS. A nonpreferred
provider may not bill an insured eligible to receive services under
a preferred provider benefit plan, and the insured is not liable to
the provider, for emergency care provided in a hospital,
freestanding emergency medical care facility, or similar facility
that is a preferred provider except for any applicable copayment,
coinsurance, or deductible that would be owed if the provider was a
preferred provider under the plan.
Sec. 1301.255. ARBITRATOR QUALIFICATIONS. (a) Except as
provided by Subsection (b), to qualify for an appointment as an
arbitrator under this subchapter, a person must have completed at
least 40 classroom hours of training in dispute resolution
techniques in a course conducted by an alternative dispute
resolution organization or other dispute resolution organization
approved by the chief administrative law judge.
(b) A person not qualified under Subsection (a) may be
appointed as an arbitrator on agreement of the parties.
(c) A person may not act as an arbitrator for a claim
settlement dispute if the person has been employed by, consulted
for, or otherwise had a business relationship with an insurer
offering the preferred provider benefit plan or a health care
provider during the three years immediately preceding the request
for arbitration.
Sec. 1301.256. APPOINTMENT OF ARBITRATOR. (a) An
arbitration under this subchapter shall be conducted by one
arbitrator.
(b) The chief administrative law judge shall appoint the
arbitrator through a random assignment from a list of qualified
arbitrators maintained by the State Office of Administrative
Hearings.
(c) Notwithstanding Subsection (b), a person other than an
arbitrator appointed by the chief administrative law judge may
conduct the arbitration on agreement of all of the parties and
notice to the chief administrative law judge.
Sec. 1301.257. REQUEST AND PRELIMINARY PROCEDURES FOR
ARBITRATION. (a) If a dispute arises over the nonpreferred
provider's fee or the insurer's payment to the provider, the
provider or insurer may request arbitration under this subchapter.
(b) A request for arbitration must be provided to the
department on a form prescribed by the commissioner and must
include:
(1) the name of the nonpreferred provider and insurer;
(2) a brief description of the claim to be resolved,
including the nonpreferred provider's fee and the insurer's payment
to the provider;
(3) contact information, including a telephone
number, for the requesting party and the party's counsel, if the
party retains counsel; and
(4) any other information the commissioner may require
by rule.
(c) On receipt of a request for arbitration, the department
shall notify the nonpreferred provider, insurer, and insured of the
request. In the notice to the insured, the department must explain
in plain language the amount billed by the provider, the amount paid
by the insurer, that either the provider or insurer has requested
arbitration, and that the insured has a right to participate in the
informal settlement teleconference or arbitration.
(d) In an effort to settle the claim before arbitration, the
nonpreferred provider and insurer shall participate in an informal
settlement teleconference not later than the 30th day after the
date on which a party submits a request for arbitration under this
section. The insured may elect to participate in the
teleconference.
(e) A claim to be resolved under this subchapter that does
not settle as a result of a teleconference conducted under
Subsection (d) must be referred to the State Office of
Administrative Hearings by the department, and an arbitration
hearing must be conducted in the county in which the medical
services were rendered.
(f) The State Office of Administrative Hearings may
implement measures, including an additional informal settlement
teleconference, to encourage early and informal resolution to a
billing dispute before arbitration commences.
(g) The insured may elect to participate in the arbitration.
Sec. 1301.258. CONDUCT OF ARBITRATION. (a) In arbitration
conducted under this subchapter, an arbitrator shall determine
whether the nonpreferred provider's billed charge or the insurer's
payment to the provider is the reasonable amount to be paid for the
emergency care that is the basis for the claim. In determining the
amount to be paid, the arbitrator shall consider the criteria under
Section 1301.259.
(b) An arbitrator shall determine the amount to be paid not
later than the 30th day after the date the arbitrator receives the
claim.
(c) If an arbitrator determines, based on the nonpreferred
provider's billed charge and insurer's payment, that a settlement
between the provider and insurer is reasonably likely or that both
the provider's billed charge and insurer's payment represent
unreasonable extremes, then the arbitrator may require the parties
to negotiate in good faith for a settlement. The arbitrator may
grant the parties not more than 10 business days for the
negotiation, which run concurrently with the 30-day period for
arbitration.
(d) Except as provided by this subchapter, the arbitrator
must hold in strict confidence all information provided to the
arbitrator by a party and all communications of the arbitrator with
a party.
(e) A party must have an opportunity during the arbitration
to speak and state the party's position.
(f) The arbitrator may:
(1) receive in evidence any documentary evidence or
other information the arbitrator considers relevant;
(2) administer oaths; and
(3) issue subpoenas to require:
(A) the attendance and testimony of witnesses;
and
(B) the production of books, records, and other
evidence relevant to a claim presented for arbitration.
(g) The determination of an arbitrator is binding on the
nonpreferred provider and insurer and is admissible in court or in
an administrative proceeding.
Sec. 1301.259. CRITERIA FOR DETERMINING PAYMENT AMOUNT. In
determining the appropriate amount to be paid for the emergency
care, the arbitrator shall consider all relevant factors,
including:
(1) whether there is a gross disparity between the
billed charge for the same services rendered by the nonpreferred
provider as compared to:
(A) payments to the provider for the same
services rendered by the provider to other patients in preferred
provider benefit plans in which the provider is a nonpreferred
provider; and
(B) payments by the insurer to reimburse
similarly qualified nonpreferred providers for the same services in
the same region;
(2) the level of training, education, and experience
of the nonpreferred provider;
(3) the nonpreferred provider's usual charge for
comparable services with regard to insureds in preferred provider
benefit plans in which the provider is a nonpreferred provider;
(4) the circumstances and complexity of the particular
case, including time and place of the services;
(5) individual patient characteristics; and
(6) the usual and customary cost of the service.
Sec. 1301.260. PAYMENT FOR ARBITRATION COSTS. (a) If an
arbitrator determines the insurer's payment as the amount to be
paid, the nonpreferred provider shall pay the arbitration costs.
(b) If an arbitrator determines the nonpreferred provider's
billed charge as the amount to be paid, the insurer shall pay the
arbitration costs.
(c) If good faith negotiation under Section 1301.258(c)
results in a settlement between the nonpreferred provider and
insurer, the provider and insurer shall evenly divide and share the
costs of arbitration.
SECTION 2. Subchapter A, Chapter 1467, Insurance Code, is
amended by adding Section 1467.0021 to read as follows:
Sec. 1467.0021. CERTAIN CLAIMS EXCLUDED. This chapter does
not apply to a claim with respect to which Subchapter F, Chapter
1301, applies.
SECTION 3. The change in law made by this Act applies only
to a payment for emergency care provided by a nonpreferred provider
at a health care facility that is a preferred provider on or after
January 1, 2016. Payment for emergency care provided before
January 1, 2016, is 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, 2015.