85R8526 BEE-F
By: Paul H.B. No. 3348
A BILL TO BE ENTITLED
AN ACT
relating to coverage under a preferred provider benefit plan for
certain services provided by out-of-network providers; authorizing
a fee.
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. COVERAGE FOR CERTAIN OUT-OF-NETWORK SERVICES
Sec. 1301.251. DEFINITIONS. In this subchapter:
(1) "Database provider" means a database provider
certified by the department under Section 1301.254.
(2) "Designated reimbursement information
organization" means an organization designated by the commissioner
under Section 1301.256.
(3) "Emergency care" has the meaning assigned by
Section 1301.155.
(4) "Geozip area" means an area that includes all zip
codes with the identical first three digits. For purposes of this
term, the geozip area is the closest geozip area to the location in
which the health care service was performed if the location does not
have a zip code.
(5) "Out-of-network provider," with respect to a
preferred provider benefit plan, means a physician or health care
provider that is not a preferred provider of the plan.
(6) "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.
(7) "Usual and customary charge" means an average
charge for a service or procedure, classified by geozip area and
Current Procedural Terminology code that is in the 80th percentile
of the undiscounted billed charges for that service reported to a
database provider.
Sec. 1301.252. AVAILABILITY OF PREFERRED BENEFIT COVERAGE
LEVELS FOR CERTAIN OUT-OF-NETWORK SERVICES. (a) An insurer shall
offer coverage to the insured that provides reimbursement at the
preferred level of benefits for emergency care provided by an
out-of-network provider at an institutional provider that is a
preferred provider.
(b) Coverage described by Subsection (a) must provide that
the insured is held harmless for any amount charged by an
out-of-network provider in excess of the amount of copayment,
deductible, or coinsurance that the insured would have paid if the
insured received the services from a preferred provider.
(c) An insurer may charge an additional premium for the
coverage described by Subsection (a).
Sec. 1301.253. PAYMENT OF CERTAIN CLAIMS. (a) On receipt
of a claim for payment by an out-of-network provider for a service
covered under Section 1301.252, an insurer shall obtain from a
database provider a certification:
(1) of the usual and customary charge for the service;
or
(2) that there are not sufficient reported charges in
the database provider's database to establish the usual and
customary charge for the service.
(b) If an out-of-network provider submits to an insurer a
claim for payment described by Subsection (a), the insurer shall
pay, minus any portion of the charge that is the insured's
responsibility under the preferred provider benefit plan, the
lesser of:
(1) the amount that the provider would have received
if the provider were a preferred provider; or
(2) the following amount provided by a database
provider selected by the insurer, as applicable:
(A) the usual and customary charge for the
service; or
(B) if there are not sufficient reported charges
in the database provider's database to establish the usual and
customary charge for the service, 80 percent of the billed charge or
an amount equal to the 90th percentile of the charges for the
service reported by the designated reimbursement information
organization for physicians and health care providers in the same
geozip area.
(c) An out-of-network provider shall accept as full payment
for a claim described by Subsection (a) the total of:
(1) the portion of the charge that is the insured's
responsibility under the preferred provider benefit plan; and
(2) a payment received from the insurer that complies
with Subsection (b).
(d) An insurer may not pay a provider less than the amount
required under this section solely because the insurer has not
received a portion of the charge that is the insured's
responsibility.
Sec. 1301.254. 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 a nonprofit organization
that:
(1) maintains a database with content that complies
with this section;
(2) maintains an active Internet website accessible to
the public and to all insurers subscribing to the database; and
(3) 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) A database provider must compute usual and customary
charges for services provided by physicians or health care
providers in accordance with this subchapter.
(d) The data in the database must contain out-of-network
charges, classified by Current Procedural Terminology code, for
physician and health care providers in each geozip area in this
state.
(e) The data in the database may not:
(1) include:
(A) any data other than out-of-network billed
charges from physicians and health care providers in this state;
(B) physician and health care provider 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, including
an insurer, a holding company of an insurer, or a trade association
in the field of insurance or health benefits.
(g) The Internet website required by this section must allow
an individual to determine the usual and customary charge for a
particular service provided by a physician or health care provider.
(h) The department shall ensure that:
(1) the data in the database used to compute usual and
customary charges of out-of-network providers is updated regularly
to accurately reflect current physician and health care provider
retail charges;
(2) charge information that is more than seven years
old is removed from the database; and
(3) at least one entity is certified as a database
provider.
(i) The department may charge a fee for certification under
this section in an amount necessary to implement this section.
Sec. 1301.255. PROVISION OF USUAL AND CUSTOMARY CHARGE BY
DATABASE PROVIDER. For each service for which a billed charge is
submitted by a physician or health care provider to an insurer that
subscribes to the database, the database provider shall provide the
insurer with a certification of the usual and customary charge or a
certification that there are not sufficient reported charges in the
database provider's database to establish the usual and customary
charge for the service, as applicable.
Sec. 1301.256. DESIGNATED REIMBURSEMENT INFORMATION
ORGANIZATION. (a) The commissioner by rule shall designate an
organization described by this section to report charges for
services provided by physicians and health care providers for which
coverage is provided under Section 1301.252.
(b) The organization designated under this section must be
an independent, not-for-profit organization created to:
(1) establish and maintain a database to help insurers
determine reimbursement rates for out-of-network charges; and
(2) provide insureds with a clear, unbiased
explanation of the reimbursement process.
Sec. 1301.257. DISCLOSURES REGARDING PAYMENT OF
OUT-OF-NETWORK PROVIDER. (a) An insurer must provide a
description of the coverage offered under Section 1301.252 on an
Internet website maintained by the insurer and in a written
disclosure provided to a prospective purchaser of the coverage.
The description must include:
(1) the definition of "usual and customary charge"
assigned by Section 1301.251 and a description of how payment to an
out-of-network provider will, if applicable, be based on the lesser
of:
(A) the amount the provider would have received
if the provider were a preferred provider; or
(B) the following amount provided by a database
provider selected by the insurer, as applicable:
(i) the usual and customary charge for the
service; or
(ii) if there are not sufficient reported
charges in the database provider's database to establish the usual
and customary charge for the service, 80 percent of the billed
charge or an amount equal to the 90th percentile of the charges for
the service reported by the designated reimbursement information
organization for physicians and health care providers in the same
geozip area;
(2) examples of the anticipated portion of the charge
that will be the insured's responsibility for specific services for
which out-of-network providers frequently bill in situations for
which coverage is offered under Section 1301.252;
(3) a methodology for determining the anticipated
portion of the charge that will be the insured's responsibility for
a specific service that is based on the amount, not an
approximation, that the insurer pays;
(4) 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
(5) a statement that if the insurer's payment due under
coverage provided under Section 1301.252 is not sufficient to cover
the total billed charge, the physician or health care provider
agrees to accept as payment in full the amount paid by the plan in
accordance with the coverage provisions plus any portion of the
charge that is the insured's responsibility under the plan.
(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.
SECTION 2. Subchapter F, Chapter 1301, Insurance Code, as
added by this Act, applies only to a preferred provider benefit plan
that is delivered, issued for delivery, or renewed on or after
January 1, 2018. A plan delivered, issued for delivery, or renewed
before January 1, 2018, is governed by the law as it existed
immediately before the effective date of this Act, and that law is
continued in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2017.