| 1 | 1 | | 85R3340 MEW-D |
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| 2 | 2 | | By: Campbell, Buckingham S.B. No. 1636 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to the use of extrapolation by a health maintenance |
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| 8 | 8 | | organization or an insurer to audit claims. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Section 843.340, Insurance Code, is amended by |
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| 11 | 11 | | adding Subsections (f) and (g) to read as follows: |
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| 12 | 12 | | (f) A health maintenance organization may not use |
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| 13 | 13 | | extrapolation to complete an audit of a participating physician or |
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| 14 | 14 | | provider. Any additional payment due a participating physician or |
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| 15 | 15 | | provider or any refund due the health maintenance organization must |
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| 16 | 16 | | be based on the actual overpayment or underpayment and may not be |
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| 17 | 17 | | based on an extrapolation. |
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| 18 | 18 | | (g) In this section, "extrapolation" means a mathematical |
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| 19 | 19 | | process or technique used by a health maintenance organization in |
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| 20 | 20 | | the audit of a participating physician or provider to estimate |
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| 21 | 21 | | audit results or findings for a larger batch or group of claims not |
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| 22 | 22 | | reviewed by the health maintenance organization. |
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| 23 | 23 | | SECTION 2. Section 1301.105, Insurance Code, is amended by |
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| 24 | 24 | | adding Subsections (e) and (f) to read as follows: |
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| 25 | 25 | | (e) An insurer may not use extrapolation to complete an |
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| 26 | 26 | | audit of a preferred provider. Any additional payment due a |
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| 27 | 27 | | preferred provider or any refund due the insurer must be based on |
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| 28 | 28 | | the actual overpayment or underpayment and may not be based on an |
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| 29 | 29 | | extrapolation. |
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| 30 | 30 | | (f) In this section, "extrapolation" means a mathematical |
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| 31 | 31 | | process or technique used by an insurer in the audit of a preferred |
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| 32 | 32 | | provider to estimate audit results or findings for a larger batch or |
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| 33 | 33 | | group of claims not reviewed by the insurer. |
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| 34 | 34 | | SECTION 3. The change in law made by this Act applies only |
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| 35 | 35 | | to the audit of a physician or provider under a contract with an |
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| 36 | 36 | | insurer or health maintenance organization entered into or renewed |
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| 37 | 37 | | on or after the effective date of this Act. |
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| 38 | 38 | | SECTION 4. This Act takes effect September 1, 2017. |
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