87R8037 KKR-F
By: Patterson H.B. No. 4385
A BILL TO BE ENTITLED
AN ACT
relating to medical benefits under the workers' compensation
system.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 1305.053, Insurance Code, is amended to
read as follows:
Sec. 1305.053. CONTENTS OF APPLICATION. Each certificate
application must include:
(1) a description or a copy of the applicant's basic
organizational structure documents and other related documents,
including organizational charts or lists that show:
(A) the relationships and contracts between the
applicant and any affiliates of the applicant; and
(B) the internal organizational structure of the
applicant's management and administrative staff;
(2) biographical information regarding each person
who governs or manages the affairs of the applicant, accompanied by
information sufficient to allow the commissioner to determine the
competence, fitness, and reputation of each officer or director of
the applicant or other person having control of the applicant;
(3) a copy of the form of any contract between the
applicant and any provider or group of providers, and with any third
party performing services on behalf of the applicant under
Subchapter D;
(4) a copy of the form of each contract with an
insurance carrier, as described by Section 1305.154;
(5) a financial statement, current as of the date of
the application, that is prepared using generally accepted
accounting practices and includes:
(A) a balance sheet that reflects a solvent
financial position;
(B) an income statement;
(C) a cash flow statement; and
(D) the sources and uses of all funds;
(6) a statement acknowledging that lawful process in a
legal action or proceeding against the network on a cause of action
arising in this state is valid if served in the manner provided by
Chapter 804 for a domestic company;
(7) a description and a map of the applicant's service
area or areas, with key and scale, that identifies each county or
part of a county to be served;
(8) a description of programs and procedures to be
utilized, including:
(A) a complaint system, as required under
Subchapter I; and
(B) a quality improvement program, as required
under Subchapter G; [and
[(C) the utilization review program described in
Subchapter H;]
(9) a list of all contracted network providers that
demonstrates the adequacy of the network to provide comprehensive
health care services sufficient to serve the population of injured
employees within the service area and maps that demonstrate that
the access and availability standards under Subchapter G are met;
and
(10) any other information that the commissioner
requires by rule to implement this chapter.
SECTION 2. Section 1305.154(c), Insurance Code, is amended
to read as follows:
(c) A network's contract with a carrier must include:
(1) a description of the functions that the carrier
delegates to the network, consistent with the requirements of
Subsection (b), and the reporting requirements for each function;
(2) a statement that the network and any management
contractor or third party to which the network delegates a function
will perform all delegated functions in full compliance with all
requirements of this chapter, the Texas Workers' Compensation Act,
and rules of the commissioner or the commissioner of workers'
compensation;
(3) a provision that the contract:
(A) may not be terminated without cause by either
party without 90 days' prior written notice; and
(B) must be terminated immediately if cause
exists;
(4) a hold-harmless provision stating that the
network, a management contractor, a third party to which the
network delegates a function, and the network's contracted
providers are prohibited from billing or attempting to collect any
amounts from employees for health care services under any
circumstances, including the insolvency of the carrier or the
network, except as provided by Section 1305.451(b)(6);
(5) a statement that the carrier retains ultimate
responsibility for ensuring that all delegated functions and all
management contractor functions are performed in accordance with
applicable statutes and rules and that the contract may not be
construed to limit in any way the carrier's responsibility,
including financial responsibility, to comply with all statutory
and regulatory requirements;
(6) a statement that the network's role is to provide
the services described under Subsection (b) as well as any other
services or functions delegated by the carrier, including functions
delegated to a management contractor, subject to the carrier's
oversight and monitoring of the network's performance;
(7) a requirement that the network provide the
carrier, at least monthly and in a form usable for audit purposes,
the data necessary for the carrier to comply with reporting
requirements of the department and the division of workers'
compensation with respect to any services provided under the
contract, as determined by commissioner rules;
(8) a requirement that the carrier, the network, any
management contractor, and any third party to which the network
delegates a function comply with the data reporting requirements of
the Texas Workers' Compensation Act and rules of the commissioner
of workers' compensation;
(9) a contingency plan under which the carrier would,
in the event of termination of the contract or a failure to perform,
reassume one or more functions of the network under the contract,
including functions related to:
(A) payments to providers and notification to
employees;
(B) quality of care; and
(C) [utilization review; and
[(D)] continuity of care, including a plan for
identifying and transitioning employees to new providers;
(10) a provision that requires that any agreement by
which the network delegates any function to a management contractor
or any third party be in writing, and that such an agreement require
the delegated third party or management contractor to be subject to
all the requirements of this subchapter;
(11) [a provision that requires the network to provide
to the department the license number of a management contractor or
any delegated third party who performs a function that requires a
license as a utilization review agent under Chapter 4201 or any
other license under this code or another insurance law of this
state;
[(12)] an acknowledgment that:
(A) any management contractor or third party to
whom the network delegates a function must perform in compliance
with this chapter and other applicable statutes and rules, and that
the management contractor or third party is subject to the
carrier's and the network's oversight and monitoring of its
performance; and
(B) if the management contractor or the third
party fails to meet monitoring standards established to ensure that
functions delegated to the management contractor or the third party
under the delegation contract are in full compliance with all
statutory and regulatory requirements, the carrier or the network
may cancel the delegation of one or more delegated functions;
(12) [(13)] a requirement that the network and any
management contractor or third party to which the network delegates
a function provide all necessary information to allow the carrier
to provide information to employees as required by Section
1305.451; and
(13) [(14)] a provision that requires the network, in
contracting with a third party directly or through another third
party, to require the third party to permit the commissioner to
examine at any time any information the commissioner believes is
relevant to the third party's financial condition or the ability of
the network to meet the network's responsibilities in connection
with any function the third party performs or has been delegated.
SECTION 3. Section 1305.451(b), Insurance Code, is amended
to read as follows:
(b) The written description required under Subsection (a)
must be in English, Spanish, and any additional language common to
an employer's employees, must be in plain language and in a readable
and understandable format, and must include, in a clear, complete,
and accurate format:
(1) a statement that the entity providing health care
to employees is a workers' compensation health care network;
(2) the network's toll-free number and address for
obtaining additional information about the network, including
information about network providers;
(3) a statement that in the event of an injury, the
employee must select a treating doctor:
(A) from a list of all the network's treating
doctors who have contracts with the network in that service area; or
(B) as described by Section 1305.105;
(4) a statement that, except for emergency services,
the employee shall obtain all health care and specialist referrals
through the employee's treating doctor;
(5) an explanation that network providers have agreed
to look only to the network or insurance carrier and not to
employees for payment of providing health care, except as provided
by Subdivision (6);
(6) a statement that if the employee obtains health
care from non-network providers without network approval, except as
provided by Section 1305.006, the insurance carrier may not be
liable, and the employee may be liable, for payment for that health
care;
(7) information about how to obtain emergency care
services, including emergency care outside the service area, and
after-hours care;
(8) [a list of the health care services for which the
insurance carrier or network requires preauthorization or
concurrent review;
[(9)] an explanation regarding continuity of
treatment in the event of the termination from the network of a
treating doctor;
(9) [(10)] a description of the network's complaint
system, including a statement that the network is prohibited from
retaliating against:
(A) an employee if the employee files a complaint
against the network or appeals a decision of the network; or
(B) a provider if the provider, on behalf of an
employee, reasonably files a complaint against the network or
appeals a decision of the network;
(10) [(11)] a summary of the insurance carrier's or
network's procedures relating to adverse determinations and the
availability of the independent review process;
(11) [(12)] a list of network providers updated at
least quarterly, including:
(A) the names and addresses of the providers;
(B) a statement of limitations of accessibility
and referrals to specialists; and
(C) a disclosure of which providers are accepting
new patients; and
(12) [(13)] a description of the network's service
area.
SECTION 4. Section 4201.054(a), Insurance Code, is amended
to read as follows:
(a) This [Except as provided by this section, this] chapter
does not apply [applies] to [utilization review of] a health care
service provided to a person eligible for workers' compensation
medical benefits under Title 5, Labor Code. [The commissioner of
workers' compensation shall regulate as provided by this chapter a
person who performs utilization review of a medical benefit
provided under Title 5, Labor Code.]
SECTION 5. Section 408.0043(a), Labor Code, is amended to
read as follows:
(a) This section applies to a person, other than a
chiropractor or a dentist, who performs health care services under
this title as:
(1) a doctor performing peer review;
(2) [a doctor performing a utilization review of a
health care service provided to an injured employee;
[(3)] a doctor performing an independent review of a
health care service provided to an injured employee;
[(4) a designated doctor;
[(5) a doctor performing a required medical
examination;] or
(3) [(6)] a doctor serving as a member of the medical
quality review panel.
SECTION 6. Section 408.0044(a), Labor Code, is amended to
read as follows:
(a) This section applies to a dentist who performs dental
services under this title as:
(1) a doctor performing peer review of dental
services; or
(2) [a doctor performing a utilization review of a
dental service provided to an injured employee;
[(3)] a doctor performing an independent review of a
dental service provided to an injured employee[; or
[(4) a doctor performing a required dental
examination].
SECTION 7. Section 408.0045(a), Labor Code, is amended to
read as follows:
(a) This section applies to a chiropractor who performs
chiropractic services under this title as:
(1) a doctor performing peer review of chiropractic
services;
(2) [a doctor performing a utilization review of a
chiropractic service provided to an injured employee;
[(3)] a doctor performing an independent review of a
chiropractic service provided to an injured employee;
[(4) a designated doctor providing chiropractic
services;
[(5) a doctor performing a required medical
examination;] or
(3) [(6)] a chiropractor serving as a member of the
medical quality review panel.
SECTION 8. Section 408.021(a), Labor Code, is amended to
read as follows:
(a) An employee who sustains a compensable injury is
entitled to all health care reasonably required by the nature of the
injury as and when needed as determined by the employee's treating
doctor. The employee is specifically entitled to health care that:
(1) cures or relieves the effects naturally resulting
from the compensable injury;
(2) promotes recovery; or
(3) enhances the ability of the employee to return to
or retain employment.
SECTION 9. Sections 408.0231(b), (c), (e), and (f), Labor
Code, are amended to read as follows:
(b) The commissioner by rule shall establish criteria for:
(1) deleting or suspending a doctor from the list of
approved doctors; and
(2) imposing sanctions on a doctor or an insurance
carrier as provided by this section[;
[(3) monitoring of utilization review agents, as
provided by a memorandum of understanding between the division and
the Texas Department of Insurance; and
[(4) authorizing increased or reduced utilization
review and preauthorization controls on a doctor].
(c) Rules adopted under Subsection (b) are in addition to,
and do not affect, the rules adopted under Section 415.023(b). The
criteria for deleting a doctor from the list or for recommending or
imposing sanctions may include anything the commissioner considers
relevant, including:
(1) a sanction of the doctor by the commissioner for a
violation of Chapter 413 or Chapter 415;
(2) a sanction by the Medicare or Medicaid program
for:
(A) substandard medical care;
(B) overcharging;
(C) overutilization of medical services; or
(D) any other substantive noncompliance with
requirements of those programs regarding professional practice or
billing;
(3) evidence from the division's medical records that
[the applicable insurance carrier's utilization review practices
or] the doctor's charges, fees, diagnoses, treatments,
evaluations, or impairment ratings are substantially different
from those the commissioner finds to be fair and reasonable based on
either a single determination or a pattern of practice;
(4) a suspension or other relevant practice
restriction of the doctor's license by an appropriate licensing
authority;
(5) professional failure to practice medicine or
provide health care, including chiropractic care, in an acceptable
manner consistent with the public health, safety, and welfare;
(6) findings of fact and conclusions of law made by a
court, an administrative law judge of the State Office of
Administrative Hearings, or a licensing or regulatory authority; or
(7) a criminal conviction.
(e) The commissioner shall act on a recommendation by the
medical advisor selected under Section 413.0511 and, after notice
and the opportunity for a hearing, may impose sanctions under this
section on a doctor or an insurance carrier [or may recommend action
regarding a utilization review agent]. The commissioner and the
commissioner of insurance shall enter into a memorandum of
understanding to coordinate the regulation of insurance carriers
[and utilization review agents] as necessary to ensure[:
[(1)] compliance with applicable regulations[; and
[(2) that appropriate health care decisions are
reached under this subtitle and under Chapter 4201, Insurance
Code].
(f) The sanctions the commissioner may recommend or impose
under this section include:
(1) reduction of allowable reimbursement;
(2) mandatory preauthorization of all or certain
health care services;
(3) required peer review monitoring, reporting, and
audit;
(4) deletion or suspension from the approved doctor
list [and the designated doctor list];
(5) restrictions on appointment under this chapter;
(6) conditions or restrictions on an insurance carrier
regarding actions by insurance carriers under this subtitle in
accordance with the memorandum of understanding adopted under
Subsection (e); and
(7) mandatory participation in training classes or
other courses as established or certified by the division.
SECTION 10. Section 408.122, Labor Code, is amended to read
as follows:
Sec. 408.122. ELIGIBILITY FOR IMPAIRMENT INCOME BENEFITS.
A claimant may not recover impairment income benefits unless
evidence of impairment based on an objective clinical or laboratory
finding exists. A [If the] finding of impairment made by the
claimant's treating doctor is presumed to be accurate [is made by a
doctor chosen by the claimant and the finding is contested, a
designated doctor or a doctor selected by the insurance carrier
must be able to confirm the objective clinical or laboratory
finding on which the finding of impairment is based].
SECTION 11. Section 409.0091(e), Labor Code, is amended to
read as follows:
(e) It is not a defense to a subclaim by a health care
insurer that:
(1) the subclaimant has not sought reimbursement from
a health care provider or the subclaimant's insured; or
(2) [the subclaimant or the health care provider did
not request preauthorization under Section 413.014 or rules adopted
under that section; or
[(3)] the health care provider did not bill the
workers' compensation insurance carrier, as provided by Section
408.027, before the 95th day after the date the health care for
which the subclaimant paid was provided.
SECTION 12. Section 410.307(b), Labor Code, is amended to
read as follows:
(b) If substantial change of condition is disputed, the
court shall require the employee's treating [designated] doctor in
the case to verify the substantial change of condition, if any. The
findings of the treating [designated] doctor shall be presumed to
be correct, and the court shall base its finding on the medical
evidence presented by the treating [designated] doctor in regard to
substantial change of condition unless the preponderance of the
other medical evidence is to the contrary.
SECTION 13. Section 413.002(b), Labor Code, is amended to
read as follows:
(b) In monitoring [health care providers who serve as
designated doctors under Chapter 408 and] independent review
organizations who provide services described by this chapter, the
division shall evaluate:
(1) compliance with this subtitle and with rules
adopted by the commissioner relating to medical policies, fee
guidelines, treatment guidelines, return-to-work guidelines, and
impairment ratings; and
(2) the quality and timeliness of decisions made under
Section [408.0041, 408.122, 408.151, or] 413.031.
SECTION 14. Section 413.017, Labor Code, is amended to read
as follows:
Sec. 413.017. PRESUMPTION OF REASONABLENESS. Medical [The
following medical] services provided by a treating doctor are
presumed to be reasonable[:
[(1) medical services consistent with the medical
policies and fee guidelines adopted by the commissioner; and
[(2) medical services that are provided subject to
prospective, concurrent, or retrospective review as required by the
medical policies of the division and that are authorized by an
insurance carrier].
SECTION 15. Sections 413.031(a), (e), (e-1), and (h), Labor
Code, are amended to read as follows:
(a) A party, including a health care provider, is entitled
to a review of a medical service provided or for which authorization
of payment is sought if a health care provider is:
(1) denied payment or paid a reduced amount for the
medical service rendered;
(2) [denied authorization for the payment for the
service requested or performed if authorization is required or
allowed by this subtitle or commissioner rules;
[(3)] ordered by the commissioner to refund a payment
received; or
(3) [(4)] ordered to make a payment that was refused
or reduced for a medical service rendered.
(e) Except as provided by Subsection [Subsections (d),]
(f), [and (m),] a review of the medical necessity of a health care
service provided under this chapter or Chapter 408 shall be
conducted by an independent review organization under Chapter 4202,
Insurance Code, in the same manner as reviews of utilization review
decisions by health maintenance organizations. It is a defense for
the insurance carrier if the carrier timely complies with the
decision of the independent review organization.
(e-1) In performing a review of medical necessity under
Subsection [(d) or] (e), the independent review organization shall
consider the division's health care reimbursement policies and
guidelines adopted under Section 413.011. If the independent review
organization's decision is contrary to the division's policies or
guidelines adopted under Section 413.011, the independent review
organization must indicate in the decision the specific basis for
its divergence in the review of medical necessity.
(h) The insurance carrier shall pay the cost of the review
if the dispute arises in connection with[:
[(1) a request for health care services that require
preauthorization under Section 413.014 or commissioner rules under
that section; or
[(2)] a treatment plan under Section 413.011(g) or
commissioner rules under that section.
SECTION 16. Section 413.0511(b), Labor Code, is amended to
read as follows:
(b) The medical advisor shall make recommendations
regarding the adoption of rules and policies to:
(1) develop, maintain, and review guidelines as
provided by Section 413.011, including rules regarding impairment
ratings;
(2) review compliance with those guidelines;
(3) regulate or perform other acts related to medical
benefits as required by the commissioner;
(4) impose sanctions or delete doctors from the
division's list of approved doctors under Section 408.023 for:
(A) any reason described by Section 408.0231; or
(B) noncompliance with commissioner rules;
(5) impose conditions or restrictions as authorized by
Section 408.0231(f);
(6) receive, and share with the medical quality review
panel established under Section 413.0512, confidential
information, and other information to which access is otherwise
restricted by law, as provided by Sections 413.0512, 413.0513, and
413.0514 from the Texas State Board of Medical Examiners, the Texas
Board of Chiropractic Examiners, or other occupational licensing
boards regarding a physician, chiropractor, or other type of doctor
who applies for registration or is registered with the division on
the list of approved doctors;
(7) determine minimal modifications to the
reimbursement methodology and model used by the Medicare system as
necessary to meet occupational injury requirements; and
(8) monitor the quality and timeliness of decisions
made by [designated doctors and] independent review organizations,
and the imposition of sanctions regarding those decisions.
SECTION 17. Sections 413.0512(b) and (c), Labor Code, are
amended to read as follows:
(b) The agencies that regulate health professionals who are
licensed or otherwise authorized to practice a health profession
under Title 3, Occupations Code, and who are involved in the
provision of health care as part of the workers' compensation
system in this state shall develop lists of health care providers
licensed or otherwise regulated by those agencies who have
demonstrated experience in workers' compensation [or utilization
review]. The medical advisor shall consider appointing some of the
members of the medical quality review panel from the names on those
lists and, when appointing members of the medical quality review
panel, shall select specialists from various health care specialty
fields to serve on the panel to ensure that the membership of the
panel has expertise in a wide variety of health care specialty
fields. The medical advisor shall also consider nominations for the
panel made by labor, business, and insurance organizations.
(c) The medical quality review panel shall recommend to the
medical advisor:
(1) appropriate action regarding doctors, other
health care providers, insurance carriers, [utilization review
agents,] and independent review organizations; and
(2) the addition or deletion of doctors from the list
of approved doctors under Section 408.023[; and
[(3) the certification, revocation of certification,
or denial of renewal of certification of a designated doctor under
Section 408.1225].
SECTION 18. Section 413.054(a), Labor Code, is amended to
read as follows:
(a) A person who performs services for the division as [a
designated doctor,] an independent medical examiner, a doctor
performing a medical case review, or a member of a peer review panel
has the same immunity from liability as the commissioner under
Section 402.00123.
SECTION 19. Section 415.0035(a), Labor Code, is amended to
read as follows:
(a) An insurance carrier or its representative commits an
administrative violation if that person:
(1) fails to submit to the division a settlement or
agreement of the parties; or
(2) fails to timely notify the division of the
termination or reduction of benefits and the reason for that
action[; or
[(3) denies preauthorization in a manner that is not
in accordance with rules adopted by the commissioner under Section
413.014].
SECTION 20. Sections 504.053(c) and (d), Labor Code, are
amended to read as follows:
(c) If the political subdivision or pool provides medical
benefits in the manner authorized under Subsection (b)(2), the
following do not apply:
(1) [Sections 408.004 and 408.0041, unless use of a
required medical examination or designated doctor is necessary to
resolve an issue relating to the entitlement to or amount of income
benefits under this title;
[(2)] Subchapter B, Chapter 408, except for Section
408.021;
(2) [(3)] Chapter 413, except for Section 413.042; and
(3) [(4)] Chapter 1305, Insurance Code, except for
Sections 1305.501, 1305.502, and 1305.503.
(d) If the political subdivision or pool provides medical
benefits in the manner authorized under Subsection (b)(2), the
following standards apply:
(1) the political subdivision or pool must ensure that
workers' compensation medical benefits are reasonably available to
all injured workers of the political subdivision or the injured
workers of the members of the pool within a designed service area;
(2) the political subdivision or pool must ensure that
all necessary health care services are provided in a manner that
will ensure the availability of and accessibility to adequate
health care providers, specialty care, and facilities;
(3) the political subdivision or pool must have an
internal review process for resolving complaints relating to the
manner of providing medical benefits, including an appeal to the
governing body or its designee and appeal to an independent review
organization;
(4) the political subdivision or pool must establish
reasonable procedures for the transition of injured workers to
contract providers and for the continuity of treatment, including
notice of impending termination of providers and a current list of
contract providers;
(5) the political subdivision or pool shall provide
for emergency care if an injured worker cannot reasonably reach a
contract provider and the care is for medical screening or other
evaluation that is necessary to determine whether a medical
emergency condition exists, necessary emergency care services
including treatment and stabilization, and services originating in
a hospital emergency facility following treatment or stabilization
of an emergency medical condition;
(6) [prospective or concurrent review of the medical
necessity and appropriateness of health care services must comply
with Article 21.58A, Insurance Code;
[(7)] the political subdivision or pool shall continue
to report data to the appropriate agency as required by Title 5 of
this code and Chapter 1305, Insurance Code; and
(7) [(8)] a political subdivision or pool is subject
to the requirements under Sections 1305.501, 1305.502, and
1305.503, Insurance Code.
SECTION 21. Section 504.055(b), Labor Code, is amended to
read as follows:
(b) This section applies only to a first responder who
sustains a [serious] bodily injury, as defined by Section 1.07,
Penal Code, in the course and scope of employment that prevents the
first responder from performing the full duties assigned to the
first responder at the time of the injury. For purposes of this
section, an injury sustained in the course and scope of employment
includes an injury sustained by a first responder providing
services on a volunteer basis.
SECTION 22. The following provisions are repealed:
(1) Sections 1305.004(a)(19), (27), (28), and (29),
Insurance Code;
(2) Section 1305.101(b), Insurance Code;
(3) Section 1305.153(b), Insurance Code;
(4) Subchapter H, Chapter 1305, Insurance Code;
(5) Section 4201.054(b), Insurance Code;
(6) Sections 401.011(22-a), (38-a), (42-a), and
(42-b), Labor Code;
(7) Section 408.004, Labor Code;
(8) Section 408.0041, Labor Code;
(9) Section 408.0042, Labor Code;
(10) Section 408.1225, Labor Code;
(11) Section 408.125, Labor Code;
(12) Section 408.151, Labor Code;
(13) Section 409.0091(d), Labor Code;
(14) Section 413.014, Labor Code;
(15) Sections 413.031(d), (g), and (m), Labor Code;
and
(16) Section 413.044, Labor Code.
SECTION 23. The change in law made by this Act applies only
to a claim for workers' compensation benefits based on a
compensable injury that occurs on or after the effective date of
this Act. A claim based on a compensable injury that occurs before
the effective date of this Act is governed by the law in effect on
the date the compensable injury occurred, and the former law is
continued in effect for that purpose.
SECTION 24. This Act takes effect September 1, 2021.