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  85R8526 BEE-F
 
  By: Paul H.B. No. 3348
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to coverage under a preferred provider benefit plan for
  certain services provided by out-of-network providers; authorizing
  a fee.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 1301, Insurance Code, is amended by
  adding Subchapter F to read as follows:
  SUBCHAPTER F. COVERAGE FOR CERTAIN OUT-OF-NETWORK SERVICES 
         Sec. 1301.251.  DEFINITIONS. In this subchapter:
               (1)  "Database provider" means a database provider
  certified by the department under Section 1301.254.
               (2)  "Designated reimbursement information
  organization" means an organization designated by the commissioner
  under Section 1301.256.
               (3)  "Emergency care" has the meaning assigned by
  Section 1301.155.
               (4)  "Geozip area" means an area that includes all zip
  codes with the identical first three digits. For purposes of this
  term, the geozip area is the closest geozip area to the location in
  which the health care service was performed if the location does not
  have a zip code.
               (5)  "Out-of-network provider," with respect to a
  preferred provider benefit plan, means a physician or health care
  provider that is not a preferred provider of the plan.
               (6)  "Purchaser" means an insured under a preferred
  provider benefit plan, regardless of whether the insured pays any
  part of the insured's premium, and a sponsor of the preferred
  provider benefit plan, regardless of whether the sponsor pays any
  part of an insured's premium.
               (7)  "Usual and customary charge" means an average
  charge for a service or procedure, classified by geozip area and
  Current Procedural Terminology code that is in the 80th percentile
  of the undiscounted billed charges for that service reported to a
  database provider.
         Sec. 1301.252.  AVAILABILITY OF PREFERRED BENEFIT COVERAGE
  LEVELS FOR CERTAIN OUT-OF-NETWORK SERVICES. (a) An insurer shall
  offer coverage to the insured that provides reimbursement at the
  preferred level of benefits for emergency care provided by an
  out-of-network provider at an institutional provider that is a
  preferred provider.
         (b)  Coverage described by Subsection (a) must provide that
  the insured is held harmless for any amount charged by an
  out-of-network provider in excess of the amount of copayment,
  deductible, or coinsurance that the insured would have paid if the
  insured received the services from a preferred provider.
         (c)  An insurer may charge an additional premium for the
  coverage described by Subsection (a).
         Sec. 1301.253.  PAYMENT OF CERTAIN CLAIMS. (a)  On receipt
  of a claim for payment by an out-of-network provider for a service
  covered under Section 1301.252, an insurer shall obtain from a
  database provider a certification:
               (1)  of the usual and customary charge for the service;
  or
               (2)  that there are not sufficient reported charges in
  the database provider's database to establish the usual and
  customary charge for the service.
         (b)  If an out-of-network provider submits to an insurer a
  claim for payment described by Subsection (a), the insurer shall
  pay, minus any portion of the charge that is the insured's
  responsibility under the preferred provider benefit plan, the
  lesser of:
               (1)  the amount that the provider would have received
  if the provider were a preferred provider; or
               (2)  the following amount provided by a database
  provider selected by the insurer, as applicable:
                     (A)  the usual and customary charge for the
  service; or
                     (B)  if there are not sufficient reported charges
  in the database provider's database to establish the usual and
  customary charge for the service, 80 percent of the billed charge or
  an amount equal to the 90th percentile of the charges for the
  service reported by the designated reimbursement information
  organization for physicians and health care providers in the same
  geozip area.
         (c)  An out-of-network provider shall accept as full payment
  for a claim described by Subsection (a) the total of:
               (1)  the portion of the charge that is the insured's
  responsibility under the preferred provider benefit plan; and
               (2)  a payment received from the insurer that complies
  with Subsection (b).
         (d)  An insurer may not pay a provider less than the amount
  required under this section solely because the insurer has not
  received a portion of the charge that is the insured's
  responsibility.
         Sec. 1301.254.  CERTIFICATION AND QUALIFICATIONS OF
  DATABASE PROVIDER AND DATABASE. (a)  A database provider that is
  used to determine usual and customary charges for the purposes of
  this subchapter must be certified by the department.  The
  department may certify a database provider under this subchapter
  only if the department determines that the database provider and
  the database used by the provider for the purposes of this
  subchapter comply with this section.
         (b)  A database provider must be a nonprofit organization
  that:
               (1)  maintains a database with content that complies
  with this section;
               (2)  maintains an active Internet website accessible to
  the public and to all insurers subscribing to the database; and
               (3)  demonstrates an ability to:
                     (A)  maintain a compilation of charge data that is
  absent any data required to be excluded under Subsection (e)(1);
  and
                     (B)  distinguish charges that are not related to
  one another and eliminate irrelevant or erroneous charges from
  reported charge information.
         (c)  A database provider must compute usual and customary
  charges for services provided by physicians or health care
  providers in accordance with this subchapter.
         (d)  The data in the database must contain out-of-network
  charges, classified by Current Procedural Terminology code, for
  physician and health care providers in each geozip area in this
  state.
         (e)  The data in the database may not:
               (1)  include:
                     (A)  any data other than out-of-network billed
  charges from physicians and health care providers in this state;
                     (B)  physician and health care provider charges
  that reflect payments discounted under governmental or
  nongovernmental health benefit plans; or
                     (C)  information that is more than seven years
  old; or
               (2)  exclude charges accompanied by modifiers that
  indicate procedures with complications.
         (f)  An entity may not be certified as a database provider
  for the purposes of this subchapter if the entity owns or controls,
  or is owned or controlled by, or is an affiliate of, any entity with
  a pecuniary interest in the application of the database, including
  an insurer, a holding company of an insurer, or a trade association
  in the field of insurance or health benefits.
         (g)  The Internet website required by this section must allow
  an individual to determine the usual and customary charge for a
  particular service provided by a physician or health care provider.
         (h)  The department shall ensure that:
               (1)  the data in the database used to compute usual and
  customary charges of out-of-network providers is updated regularly
  to accurately reflect current physician and health care provider
  retail charges;
               (2)  charge information that is more than seven years
  old is removed from the database; and
               (3)  at least one entity is certified as a database
  provider.
         (i)  The department may charge a fee for certification under
  this section in an amount necessary to implement this section.
         Sec. 1301.255.  PROVISION OF USUAL AND CUSTOMARY CHARGE BY
  DATABASE PROVIDER. For each service for which a billed charge is
  submitted by a physician or health care provider to an insurer that
  subscribes to the database, the database provider shall provide the
  insurer with a certification of the usual and customary charge or a
  certification that there are not sufficient reported charges in the
  database provider's database to establish the usual and customary
  charge for the service, as applicable.
         Sec. 1301.256.  DESIGNATED REIMBURSEMENT INFORMATION
  ORGANIZATION. (a)  The commissioner by rule shall designate an
  organization described by this section to report charges for
  services provided by physicians and health care providers for which
  coverage is provided under Section 1301.252.
         (b)  The organization designated under this section must be
  an independent, not-for-profit organization created to:
               (1)  establish and maintain a database to help insurers
  determine reimbursement rates for out-of-network charges; and
               (2)  provide insureds with a clear, unbiased
  explanation of the reimbursement process.
         Sec. 1301.257.  DISCLOSURES REGARDING PAYMENT OF
  OUT-OF-NETWORK PROVIDER. (a)  An insurer must provide a
  description of the coverage offered under Section 1301.252 on an
  Internet website maintained by the insurer and in a written
  disclosure provided to a prospective purchaser of the coverage.  
  The description must include:
               (1)  the definition of "usual and customary charge"
  assigned by Section 1301.251 and a description of how payment to an
  out-of-network provider will, if applicable, be based on the lesser
  of:
                     (A)  the amount the provider would have received
  if the provider were a preferred provider; or
                     (B)  the following amount provided by a database
  provider selected by the insurer, as applicable:
                           (i)  the usual and customary charge for the
  service; or
                           (ii)  if there are not sufficient reported
  charges in the database provider's database to establish the usual
  and customary charge for the service, 80 percent of the billed
  charge or an amount equal to the 90th percentile of the charges for
  the service reported by the designated reimbursement information
  organization for physicians and health care providers in the same
  geozip area;
               (2)  examples of the anticipated portion of the charge
  that will be the insured's responsibility for specific services for
  which out-of-network providers frequently bill in situations for
  which coverage is offered under Section 1301.252;
               (3)  a methodology for determining the anticipated
  portion of the charge that will be the insured's responsibility for
  a specific service that is based on the amount, not an
  approximation, that the insurer pays;
               (4)  the Internet website addresses of each database
  provider certified under this subchapter at which a purchaser or
  prospective purchaser may access the database or a single website
  address at which an updated set of links to the website addresses of
  those database providers may be accessed; and
               (5)  a statement that if the insurer's payment due under
  coverage provided under Section 1301.252 is not sufficient to cover
  the total billed charge, the physician or health care provider
  agrees to accept as payment in full the amount paid by the plan in
  accordance with the coverage provisions plus any portion of the
  charge that is the insured's responsibility under the plan.
         (b)  Disclosures under this section must:
               (1)  be made in language easily understood by
  purchasers and prospective purchasers of preferred provider
  benefit plans;
               (2)  be made in a uniform, clearly organized manner;
               (3)  be of sufficient detail and comprehensiveness as
  to provide for full and fair disclosure; and
               (4)  be updated as necessary to ensure that the
  disclosures are accurate.
         SECTION 2.  Subchapter F, Chapter 1301, Insurance Code, as
  added by this Act, applies only to a preferred provider benefit plan
  that is delivered, issued for delivery, or renewed on or after
  January 1, 2018. A plan delivered, issued for delivery, or renewed
  before January 1, 2018, is governed by the law as it existed
  immediately before the effective date of this Act, and that law is
  continued in effect for that purpose.
         SECTION 3.  This Act takes effect September 1, 2017.