Texas 2025 - 89th Regular

Texas Senate Bill SB884

Filed

1/23/25

Out of Senate Committee

4/14/25

Voted on by Senate

Out of House Committee

Voted on by House

Governor Action

Bill Becomes Law

Caption

Relating to establishment of a shared savings program for health maintenance organizations and preferred provider benefit plans.

Impact

The implementation of SB884 is expected to facilitate cost-saving measures in the state’s healthcare system by encouraging patients to utilize direct pay providers who offer services at rates lower than those typically covered by health insurance plans. This could lead to increased competition among healthcare providers to offer more affordable services while also benefiting insured patients who will receive incentive payments for opting for lower-cost options. The shared savings program aims to streamline healthcare payments and potentially lower healthcare costs across the board.

Summary

Senate Bill 884 establishes a shared savings program specifically for health maintenance organizations (HMOs) and preferred provider benefit plans in Texas. The legislation requires applicable insurers to create programs that reward enrollees for choosing lower-cost direct pay providers for medically necessary nonemergency health care services. The bill mandates that HMOs and insurers must notify their enrollees about these programs and provide transparency regarding average contracted rates for medical services, which must be made available on publicly accessible platforms.

Sentiment

General sentiment around SB884 appears to be cautiously optimistic among supporters who believe that empowering consumers to make cost-effective healthcare choices will ultimately enhance the efficiency of the healthcare system. However, there are concerns among critics regarding the real impact of such programs on healthcare quality and accessibility, particularly for individuals who may not have the means to pay out-of-pocket costs upfront. This debate reflects a broader discussion on the balance between cost savings and the assurance of quality healthcare access.

Contention

Noteworthy points of contention regarding SB884 include concerns over the potential inequities it may create, as not all patients may be able to afford to pay for services out-of-pocket initially before receiving incentive payments. Critics argue that the bill might inadvertently disadvantage lower-income individuals who rely more heavily on insurance coverage. Additionally, questions have been raised about the accuracy and transparency of the price disclosures mandated by the bill, with some stakeholders worried that insufficient regulation might lead to misleading information regarding true healthcare costs.

Texas Constitutional Statutes Affected

Insurance Code

Chapter 843. Health Maintenance Organizations
- Section: New Section
- Section: New Section

Chapter 1301. Preferred Provider Benefit Plans
- Section: New Section
- Section: New Section

Health And Safety Code

Chapter 324. Consumer Access To Health Care Information
- Section: New Section

Companion Bills

TX HB5099

Identical Relating to establishment of a shared savings program for certain managed care plans.

Previously Filed As

TX SB358

Relating to establishment of a shared savings program for certain managed care plans.

TX HB625

Relating to copayments required by a health maintenance organization or preferred provider benefit plan for visiting physical therapists.

TX HB2002

Relating to preferred provider benefit plan out-of-pocket expense credits for payments made by an insured directly to a physician or health care provider.

TX HB3091

Relating to identification cards issued by health maintenance organizations and preferred provider organizations.

TX HB3359

Relating to network adequacy standards and other requirements for preferred provider benefit plans.

TX SB1765

Relating to network adequacy standards and other requirements for preferred provider benefit plans.

TX HB5186

Relating to the establishment of the state health benefit plan reimbursement review board and the reimbursement for health care services or supplies provided under certain state-funded health benefit plans.

TX HB1364

Relating to a direct payment to a health care provider in lieu of a claim for benefits under a health benefit plan.

TX SB583

Relating to a direct payment to a health care provider in lieu of a claim for benefits under a health benefit plan.

TX HB3848

Relating to health maintenance organization and preferred provider benefit plan minimum access standards for nonemergency ambulance transport services delivered by emergency medical services providers; providing administrative penalties.