2015S0415-1 03/06/15
By: Seliger S.B. No. 1229
A BILL TO BE ENTITLED
AN ACT
relating to restrictions on the use of credit card payments to
settle claims for health care services.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. (a) The legislature finds and declares that
this Act is necessary to:
(1) remove barriers that hinder physicians and other
health care providers from exercising their right to receive
payments, upon request, from health plans through Health Insurance
Portability and Accountability Act-standard automated
clearinghouse electronic fund transfers;
(2) eliminate unnecessary and excessive fees imposed
on physicians and other health care providers by certain licensees
and their contracted vendors who use credit card payments, rather
than automated clearinghouse electronic fund transfer payments, to
settle claims for health care services; and
(3) eliminate the unnecessary administrative hassle
that licensee use of credit card payments in the settlement of
claims for health care services imposes on physicians and other
health care providers.
(b) The legislature finds and declares that:
(1) despite the potential benefits associated with
electronic funds transfer payments, many physicians and other
health care providers are being subjected to fees associated with
credit card payments that essentially:
(A) reduce the contracted fee amounts of
physicians and other health care providers; and
(B) shift the costs of transferring money
electronically from the licensee to the physician or other health
care provider;
(2) physicians and other health care providers are
often unaware of these high fees when accepting credit card
payments from licensees and their contracted vendors;
(3) physicians and other health care providers also
are often unaware:
(A) of their right to receive, upon request,
Health Insurance Portability and Accountability Act-standard
automated clearinghouse electronic fund transfer payments from
health plans; and
(B) that the only fee that should be assessed in
association with an automated clearinghouse electronic fund
transfer payment is a nominal banking fee;
(4) licensees often receive cash-back incentives from
credit card companies for credit card payment transactions;
(5) the use of virtual credit cards for payment is an
administrative hassle in that it requires the staff of physicians
and other health care providers to manually enter payments into
their own credit card processing system or devote staff time to
write or call the licensee to assert the right to be paid by
automated clearinghouse electronic fund transfer; and
(6) unlike payments made by patients using credit
cards, credit card payments made by licensees or their contracted
vendors do not offer significant risk reduction for physicians and
other health care providers, but nonetheless carry increased
processing charges.
SECTION 2. Subtitle C, Title 5, Insurance Code, is amended
by adding Chapter 564 to read as follows:
CHAPTER 564. PROHIBITED PRACTICES RELATED TO PAYMENT FOR
HEALTH CARE SERVICES
Sec. 564.001. CERTAIN CREDIT CARD PAYMENTS PROHIBITED.
(a) In this section:
(1) "Administrator" has the meaning assigned by
Section 4151.001. Notwithstanding that section or any other law,
the term includes:
(A) a joint fund, risk management pool, or
self-insurance pool composed of political subdivisions of this
state that participate in a fund or pool through interlocal
agreements, any nonprofit administrative agency or governing body
or other nonprofit entity that acts solely on behalf of a fund,
pool, agency, or body, or any other fund, pool, agency, or body
established under or for the purpose of implementing an interlocal
governmental agreement; and
(B) a self-insured political subdivision.
(2) "Credit card payment" means a type of electronic
funds transfer by which a licensee or a contracted vendor of a
licensee sends credit card payment information and instructions
through or on any medium to the health care provider, who then
processes the payments using standard credit card technology. The
term includes a virtual credit card payment.
(3) "Health care provider" means any person,
partnership, professional association, corporation, facility, or
institution duly licensed, certified, registered, or chartered by
this state to provide health care services, including:
(A) a physician;
(B) an officer, director, shareholder, member,
partner, manager, owner, or affiliate of a physician or other
health care provider; and
(C) an employee, independent contractor, or
agent of a physician or other health care provider acting in the
course and scope of the employment or contractual relationship.
(4) "Health care services" means services provided to
an individual to prevent, alleviate, cure, or heal human illness or
injury, including:
(A) pharmaceutical services;
(B) medical, chiropractic, or dental care
services;
(C) hospitalization; and
(D) care or services incidental to the health
care services described by Paragraphs (A)-(C).
(5) "Licensee" means:
(A) an insurer as defined by Section 1301.001;
(B) a health maintenance organization as defined
by Section 843.002;
(C) a person required to register under Section
1458.051;
(D) an administrator;
(E) an officer, director, shareholder, member,
partner, manager, owner, or affiliate of a licensee described by
Paragraphs (A)-(D); and
(F) an employee, independent contractor, or
agent of a licensee described by Paragraphs (A)-(D) acting in the
course and scope of the employment or contractual relationship.
(6) "Physician" means:
(A) an individual licensed to practice medicine
in this state;
(B) a professional association organized by an
individual physician or group of physicians;
(C) a partnership or limited liability
partnership formed by a group of physicians;
(D) a nonprofit health corporation certified by
the Texas Medical Board under Chapter 162, Occupations Code;
(E) a limited liability company formed by a group
of physicians; or
(F) a single legal entity authorized to practice
medicine owned by a group of physicians.
(7) "Virtual credit card payment" means a credit card
payment for which no physical credit card is presented to the health
care provider and the single-use credit card expires upon payment
processing.
(b) A licensee or contracted vendor of a licensee may not
use a credit card payment to settle a claim for health care services
with a health care provider.
(c) The provisions in this section may not be waived,
voided, nullified, or modified by contract.
(d) Nothing in this section may be construed to prohibit:
(1) the use of an automated clearinghouse electronic
funds transfer to settle a claim for health care services with a
health care provider;
(2) the use of a credit card to settle a claim for
health care services with a health care provider, if the payment
using a credit card is made:
(A) directly by the patient; or
(B) by an individual on behalf of the patient for
the purpose of paying the patient's out-of-pocket
responsibilities; or
(3) the use of a flexible spending account or health
savings account, without regard to whether a credit card is issued
to the patient under the account.
SECTION 3. The change in law made by this Act applies only
to charges for health care services provided on or after the
effective date of this Act. Charges for health care services
provided before the effective date of this Act are governed by the
law in effect immediately before that date, and that law is
continued in effect for that purpose.
SECTION 4. This Act takes effect September 1, 2015.