By: Hancock S.B. No. 1330
(In the Senate - Filed February 14, 2025; February 28, 2025,
read first time and referred to Committee on Health & Human
Services; March 24, 2025, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 8, Nays 0;
March 24, 2025, sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR S.B. No. 1330 By: Perry
A BILL TO BE ENTITLED
AN ACT
relating to billing and reimbursement for certain medical
equipment, devices, and supplies provided to Medicare enrollees;
creating a criminal offense.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 5, Insurance Code, is amended
by adding Chapter 566 to read as follows:
CHAPTER 566. BILLING FOR CERTAIN MEDICAL EQUIPMENT, DEVICES, AND
SUPPLIES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 566.001. DEFINITIONS. In this chapter:
(1) "Assignment" means an agreement in which a
supplier agrees to accept the Medicare-approved amount as payment
for medical equipment or a medical device or supply.
(2) "Durable medical equipment" means medical
equipment that:
(A) can withstand repeated use;
(B) is expected to last at least three years;
(C) is primarily and customarily used to serve a
medical purpose;
(D) is generally not useful in the absence of an
illness or injury; and
(E) is appropriate for use in the home.
(3) "Enrollee" means an individual enrolled in
Medicare.
(4) "Medicare" means the health benefit coverage
provided under the Health Insurance for the Aged Act (42 U.S.C.
Section 1395 et seq.).
(5) "Nonparticipating supplier" means an entity or
person who:
(A) provides Medicare-covered durable medical
equipment, orthotic devices or supplies, or prosthetic devices or
supplies to Medicare enrollees; and
(B) is not enrolled in Medicare as a
participating supplier.
(6) "Orthotic device or supply" means:
(A) a custom-fitted or custom-fabricated medical
device designed to correct a deformity, improve function, or
relieve symptoms of a disease; or
(B) a medical supply related to a device
described by Paragraph (A).
(7) "Prosthetic device or supply" means:
(A) an artificial medical device designed to
replace all or part of a limb or internal organ; or
(B) a medical supply related to a device
described by Paragraph (A).
SUBCHAPTER B. REGULATION OF CERTAIN BILLING PRACTICES
Sec. 566.051. LIMITATIONS ON BILLING; NOTICE. (a) A
nonparticipating supplier may not charge an enrollee more than 115
percent of the Medicare-approved amount for durable medical
equipment, orthotic devices or supplies, or prosthetic devices or
supplies covered under Medicare for which the supplier has not
accepted written assignment unless:
(1) before the enrollee is billed, the enrollee agrees
in writing to pay the additional amount; and
(2) before receiving the durable medical equipment,
orthotic device or supply, or prosthetic device or supply, the
enrollee:
(A) enters into a rental payment plan; or
(B) pays the additional amount in full.
(b) A written agreement between a nonparticipating supplier
and enrollee under this section must provide notice to the enrollee
that:
(1) Medicare will reimburse 80 percent of the
Medicare-approved amount for durable medical equipment, orthotic
devices or supplies, or prosthetic devices or supplies covered
under Medicare; and
(2) a Medicare supplement benefit plan issuer is not
required to reimburse the nonparticipating supplier or enrollee for
the amount by which the charge exceeds 115 percent of the
Medicare-approved amount.
SUBCHAPTER C. ENFORCEMENT
Sec. 566.101. APPLICATION OF DECEPTIVE TRADE PRACTICES LAW.
A nonparticipating supplier who violates this chapter engages in a
false, misleading, or deceptive act or practice under Section
17.46, Business & Commerce Code.
Sec. 566.102. CRIMINAL OFFENSE. (a) A nonparticipating
supplier who intentionally violates this chapter commits an
offense.
(b) An offense under this section is a misdemeanor
punishable by a fine of not less than $500 or more than $1,000.
(c) Notwithstanding any other law, an offense under this
section may be prosecuted in:
(1) Travis County; or
(2) a county in which prosecution is authorized under
the Code of Criminal Procedure.
SECTION 2. Subchapter B, Chapter 1652, Insurance Code, is
amended by adding Section 1652.059 to read as follows:
Sec. 1652.059. REIMBURSEMENT FOR CERTAIN MEDICAL
EQUIPMENT, DEVICES, AND SUPPLIES. (a) In this section, terms
defined by Section 566.001 have the meanings assigned by that
section.
(b) A Medicare supplement benefit plan issuer is not
required to reimburse an enrollee or nonparticipating supplier for
the amount by which a charge for durable medical equipment,
orthotic devices or supplies, or prosthetic devices or supplies
exceeds 115 percent of the Medicare-allowed amount for the
equipment, device, or supply.
(c) This section does not prohibit a Medicare supplement
benefit plan issuer and a nonparticipating supplier from
negotiating a level and type of reimbursement for durable medical
equipment or orthotic or prosthetic devices or supplies.
SECTION 3. Chapter 566, Insurance Code, as added by this
Act, applies only to durable medical equipment or orthotic or
prosthetic devices or supplies sold on or after the effective date
of this Act.
SECTION 4. This Act takes effect September 1, 2025.
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