87R11251 SRA-D
By: Powell S.B. No. 1684
A BILL TO BE ENTITLED
AN ACT
relating to the cost, payment, and collection of health care
expenses.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle A, Title 4, Health and Safety Code, is
amended by adding Chapter 226 to read as follows:
CHAPTER 226. COST, PAYMENT, AND COLLECTION OF HEALTH CARE EXPENSES
FOR SERVICES PROVIDED BY CERTAIN HEALTH CARE FACILITIES AND
PROFESSIONALS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 226.001. PURPOSE. The purpose of this chapter is to
reduce burdensome medical debt and to protect patients in their
dealings with medical creditors, medical debt collectors, and
medical debt buyers in connection with medical debt.
Sec. 226.002. CONSTRUCTION OF CHAPTER. This chapter shall
be liberally construed to effect its purposes.
Sec. 226.003. DEFINITIONS. In this chapter:
(1) "Commission" means the Health and Human Services
Commission.
(2) "Consumer report" has the meaning assigned by
Section 603(d) of the Fair Credit Reporting Act (15 U.S.C. Section
1681a).
(3) "Consumer reporting agency" means a person who
regularly engages wholly or partly in the practice of assembling or
evaluating consumer credit information or other information on
individuals to furnish consumer reports to third parties for
monetary fees, for dues, or on a cooperative nonprofit basis.
(4) "Executive commissioner" means the executive
commissioner of the Health and Human Services Commission.
(5) "Health care facility":
(A) means:
(i) a hospital licensed under Chapter 241;
(ii) an outpatient clinic or facility
affiliated with or operating under the license of a hospital
described by Subparagraph (i);
(iii) an ambulatory surgical center
licensed under Chapter 243; or
(iv) a facility licensed in this state that
provides outpatient health care services and has revenues of at
least $20 million annually; and
(B) includes a health care professional licensed
in this state who provides health care services in one or more of
the facilities or other health care settings described by Paragraph
(A) and who bills patients independently.
(6) "Health care services" means services for the
diagnosis, prevention, treatment, cure, or relief of a physical,
dental, behavioral, substance use disorder or mental health
condition, illness, injury, or disease. The term includes any
procedures, products, devices, or medications.
(7) "Medical creditor" means a health care facility or
other entity that provides health care services and to whom an
individual:
(A) owes money for those services; or
(B) previously owed money for those services if
the medical debt has been purchased by a medical debt buyer.
(8) "Medical debt" means a debt arising from the
receipt of health care services.
(9) "Medical debt buyer" means a person who purchases
a medical debt for collection purposes from a medical creditor or
other subsequent owner of the medical debt, regardless of whether
the person collects the medical debt, hires a third party to collect
the medical debt, or hires an attorney to pursue collection
litigation in connection with the medical debt.
(10) "Medical debt collector" means a person who
regularly collects or attempts to collect, directly or indirectly,
a medical debt originally owed or due another or asserted to be owed
or due another. The term includes a medical debt buyer.
Sec. 226.004. RULES. (a) The executive commissioner shall
adopt rules to administer this chapter.
(b) In adopting rules under this section, the executive
commissioner shall consult with the Texas Medical Board, the State
Board of Dental Examiners, and the commissioner of insurance as
appropriate and necessary.
SUBCHAPTER B. PRICE INFORMATION AND PAYMENTS
Sec. 226.051. PRICE INFORMATION ONLINE. (a) In this
section, "gross charges" means a health care facility's full
established price for a health care service that the facility
charges patients who do not have health benefit plan coverage
before applying any contractual allowances, discounts, or
deductions.
(b) A health care facility shall post price information of
the facility's health care services on its Internet website. The
information must be accessible from a link on the website's home
page, and at a minimum must:
(1) list the gross charges for each health care
service provided by the facility;
(2) list the Medicare reimbursement amount for the
health care service, next to the relevant gross charges; and
(3) use plain language titles or descriptions of
health care services that can be understood by the average
individual.
Sec. 226.052. ITEMIZED BILL. On a patient's written or oral
request and without charge, a medical creditor or medical debt
collector shall provide an itemized bill to the patient not later
than the 60th day after the date of the request. The bill must
contain:
(1) the name and address of the medical creditor;
(2) the date a health care service was provided;
(3) the date the medical debt was incurred, if
different from the date of service;
(4) a detailed list of the specific health care
services provided to the patient;
(5) a list of all health care professionals who
treated the patient;
(6) the amount of principal for any medical debt
incurred;
(7) any adjustment to the bill, such as negotiated
insurance rates or other discounts;
(8) the amount of any payments received from the
patient or any other person on the patient's behalf; and
(9) any interest or fees.
Sec. 226.053. INTEREST ON MEDICAL DEBT. (a)
Notwithstanding any agreement to the contrary or other law,
interest on medical debt is limited to the rate of interest equal to
the weekly average one-year constant maturity treasury yield, but
not less than two percent per year and not more than five percent
per year, as published by the Board of Governors of the Federal
Reserve System, for the calendar week preceding the date when the
patient was first provided with a bill for payment of the health
care services. If the Board of Governors of the Federal Reserve
System ceases to publish this interest rate, the executive
commissioner by rule shall substitute another measure for
determining a reasonable interest rate of not more than five
percent per year.
(b) Notwithstanding any agreement to the contrary or other
law, the rate of interest specified by Subsection (a) applies to a
judgment on medical debt.
Sec. 226.054. RECEIPT FOR PAYMENTS. Not later than the 10th
business day after the date payment of a medical debt is received,
the medical creditor or medical debt collector shall provide to the
person making the payment a receipt showing:
(1) the amount paid;
(2) the date payment is received;
(3) the outstanding balance of the patient's account
before the most recent payment;
(4) the new balance after application of the payment;
(5) the interest rate and interest accrued since the
last payment;
(6) the patient's account number;
(7) the name of the current owner of the debt and, if
different, the name of the medical creditor; and
(8) whether the payment is accepted as payment in full
of the debt.
Sec. 226.055. LIABILITY FOR MEDICAL DEBT. (a) Parents and
legal guardians are jointly liable for any medical debt incurred by
a child under 18 years of age.
(b) A spouse or other person is not liable for the medical
debt of a person 18 years of age or older. A person may consent to
assume liability, if the consent is:
(1) on a separate document signed by the person;
(2) not solicited in an emergency room or during an
emergency situation; and
(3) not required as a condition of providing emergency
or nonemergency health care services.
SUBCHAPTER C. MEDICAL DEBT COLLECTIONS
Sec. 226.101. PROHIBITED COLLECTION ACTIONS. To collect a
medical debt, a medical creditor or medical debt collector may not:
(1) cause an individual's arrest;
(2) cause an individual to be the subject of a capias
as defined by Article 23.01, Code of Criminal Procedure; or
(3) foreclose on an individual's real property.
Sec. 226.102. EXTRAORDINARY COLLECTION ACTIONS. (a) In
this section, "extraordinary collection action," with respect to a
patient, means:
(1) selling the patient's medical debt to another
party, unless, before the sale, the medical creditor enters into a
written agreement with the medical debt buyer providing that:
(A) the medical debt buyer may not engage in an
extraordinary collection action as provided by this section to
obtain payment of the debt; and
(B) the medical debt collector may not charge
interest on the debt at a rate in excess of the limit prescribed by
Section 226.053;
(2) reporting adverse information about the patient to
a consumer reporting agency; or
(3) initiating an action that requires a legal or
judicial process, including:
(A) placing a lien on the patient's property;
(B) seizing the patient's bank account or any
other personal property; or
(C) bringing a civil action against the patient.
(b) Except as provided by Section 226.103, a medical
creditor or medical debt collector may not engage in an
extraordinary collection action against a patient until the 180th
day after the date the first bill for an amount owed for receipt of
health care services has been sent to the patient.
(c) At least 30 days before taking an extraordinary
collection action, a medical creditor or medical debt collector
shall provide to the patient a notice containing:
(1) the extraordinary collection actions that will be
initiated to obtain payment; and
(2) a deadline after which extraordinary collection
actions will be initiated, which may not be earlier than the 30th
day after the date notice is provided.
(d) A health care facility or medical debt collector
collecting medical debt for services provided at a health care
facility may not use any extraordinary collection action not
described in the facility's billing and collections policy.
Sec. 226.103. REPORTING TO CONSUMER REPORTING AGENCY. (a)
A medical creditor or medical debt collector may not communicate
with or report information to a consumer reporting agency regarding
a patient's medical debt during the one-year period beginning on
the date when the patient was first given a bill for the health care
service to which the debt pertains.
(b) After expiration of the one-year period prescribed by
Subsection (a), a medical creditor or medical debt collector shall
give the patient at least one additional bill before reporting the
medical debt to a consumer reporting agency. The amount reported
must be the same as the amount stated in the additional bill, and
the bill must state that the debt is being reported to a consumer
reporting agency.
(c) A medical debt collector shall also provide the notice
required by 15 U.S.C. Section 1692g before reporting a medical debt
to a consumer reporting agency.
Sec. 226.104. COLLECTION OF MEDICAL DEBT DURING HEALTH
BENEFIT PLAN REVIEW PROHIBITED. (a) In this section:
(1) "External review" means a review of an adverse
benefit determination conducted under Chapter 4201, Insurance
Code, a federal external review process as described by 42 U.S.C.
Section 300gg-19, a review conducted under 29 U.S.C. Section 1133,
a Medicare appeals process, a Medicaid appeals process, or another
applicable external appeals process.
(2) "Internal review" means a review of an adverse
benefit determination conducted by a health benefit plan issuer or
other insurer.
(b) A medical creditor or medical debt collector that knows
or should have known about an internal review, external review, or
other appeal of a health benefit plan decision that concerns a
medical debt and is pending or was pending during the 60 days
preceding the date of the review or appeal may not:
(1) provide information regarding unpaid charges for
health care services to a consumer reporting agency;
(2) communicate with the patient regarding the medical
debt for the purpose of seeking to collect the debt; or
(3) initiate a lawsuit or arbitration proceeding
against the patient regarding the medical debt.
(c) If a medical debt has already been reported to a
consumer reporting agency and the medical creditor or medical debt
collector who reported the information learns of an internal
review, external review, or other appeal of a health benefit plan
decision that concerns the debt and is pending or was pending during
the 60 days preceding the date of the review or appeal, the creditor
or collector shall instruct the consumer reporting agency to delete
information about the debt.
(d) A medical creditor described by Subsection (b) may not
refer, sell, or send the medical debt to a medical debt collector,
including selling the debt to a medical debt buyer.
Sec. 226.105. FORGIVEN COST-SHARING AMOUNTS RELATED TO
HEALTH BENEFIT PLAN COVERAGE NOT BREACH OF CONTRACT. Forgiveness
of a patient's copayment, coinsurance, deductible, facility fee,
out-of-network charge, or other cost-sharing amounts related to a
patient's health benefit plan coverage is not a breach of contract
or other violation of an agreement between the medical creditor and
the health benefit plan issuer or payor.
SUBCHAPTER D. ENFORCEMENT AND REMEDIES
Sec. 226.151. DECEPTIVE TRADE PRACTICE. A violation of
this chapter constitutes a deceptive trade practice in addition to
the practices described by Subchapter E, Chapter 17, Business &
Commerce Code, and is actionable under that subchapter.
Sec. 226.152. INJUNCTIVE RELIEF. An individual may bring
an action for injunctive relief or other appropriate equitable
relief to enforce compliance with this chapter.
Sec. 226.153. WAIVER OF RIGHTS OR REMEDIES PROHIBITED. (a)
An agreement between a patient and a health care facility or medical
debt collector may not contain a provision that, before a dispute
arises, waives or has the effect of waiving the rights of a patient
to resolve the dispute by:
(1) obtaining:
(A) injunctive, declaratory, or other equitable
relief;
(B) monetary damages; or
(C) attorney's fees and costs; or
(2) requesting a hearing at which the patient can
present evidence in person.
(b) A provision that violates Subsection (a) is void and
unenforceable.
(c) A waiver by a patient or other individual of any
protection provided by or any right of the patient or other
individual granted under this chapter is void and unenforceable.
(d) The remedies provided by this section are not exclusive
remedies, and a patient is not required to exhaust any
administrative remedies provided by this chapter or any other
applicable law.
Sec. 226.154. COMPLAINT PROCESS. (a) The commission shall
establish a complaint process by which a patient or other member of
the public may file a complaint against a medical creditor or
medical debt collector who violates this chapter.
(b) A complaint filed under this section is public
information, except for the name or address of a complainant or
other personal identifying information.
SECTION 2. As soon as practicable after the effective date
of this Act, the executive commissioner of the Health and Human
Services Commission shall adopt rules as required to administer,
implement, and enforce Chapter 226, Health and Safety Code, as
added by this Act, including rules relating to establishing a
complaint process as required by Section 226.154, Health and Safety
Code, as added by this Act.
SECTION 3. The changes in law made by this Act apply only to
a health care service provided on or after the effective date of
this Act. A health care service provided before the effective date
of this Act is governed by the law in effect on the date the service
was provided, and the former law is continued in effect for that
purpose.
SECTION 4. This Act takes effect September 1, 2021.