86(R) SB 1264 - Enrolled version

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	S.B. No. 1264




	AN ACT
	relating to consumer protections against certain medical and health
	care billing by certain out-of-network providers.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	ARTICLE 1. ELIMINATION OF SURPRISE BILLING FOR CERTAIN HEALTH
	BENEFIT PLANS
	SECTION 1.01. Subtitle G, Title 5, Insurance Code, is
	amended by adding Chapter 752 to read as follows:
	CHAPTER 752. ENFORCEMENT OF BALANCE BILLING PROHIBITIONS
	Sec. 752.0001. DEFINITION. In this chapter,
	"administrator" has the meaning assigned by Section 1467.001.
	Sec. 752.0002. INJUNCTION FOR BALANCE BILLING. (a) If the
	attorney general receives a referral from the appropriate
	regulatory agency indicating that an individual or entity,
	including a health benefit plan issuer or administrator, has
	exhibited a pattern of intentionally violating a law that prohibits
	the individual or entity from billing an insured, participant, or
	enrollee in an amount greater than an applicable copayment,
	coinsurance, and deductible under the insured's, participant's, or
	enrollee's managed care plan or that imposes a requirement related
	to that prohibition, the attorney general may bring a civil action
	in the name of the state to enjoin the individual or entity from the
	violation.
	(b) If the attorney general prevails in an action brought
	under Subsection (a), the attorney general may recover reasonable
	attorney's fees, costs, and expenses, including court costs and
	witness fees, incurred in bringing the action.
	Sec. 752.0003. ENFORCEMENT BY REGULATORY AGENCY. (a) An
	appropriate regulatory agency that licenses, certifies, or
	otherwise authorizes a physician, health care practitioner, health
	care facility, or other health care provider to practice or operate
	in this state may take disciplinary action against the physician,
	practitioner, facility, or provider if the physician,
	practitioner, facility, or provider violates a law that prohibits
	the physician, practitioner, facility, or provider from billing an
	insured, participant, or enrollee in an amount greater than an
	applicable copayment, coinsurance, and deductible under the
	insured's, participant's, or enrollee's managed care plan or that
	imposes a requirement related to that prohibition.
	(b) The department may take disciplinary action against a
	health benefit plan issuer or administrator if the issuer or
	administrator violates a law requiring the issuer or administrator
	to provide notice of a balance billing prohibition or make a related
	disclosure.
	(c) A regulatory agency described by Subsection (a) or the
	commissioner may adopt rules as necessary to implement this
	section. Section 2001.0045, Government Code, does not apply to
	rules adopted under this subsection.
	SECTION 1.02. Subchapter A, Chapter 1271, Insurance Code,
	is amended by adding Section 1271.008 to read as follows:
	Sec. 1271.008. BALANCE BILLING PROHIBITION NOTICE. (a) A
	health maintenance organization shall provide written notice in
	accordance with this section in an explanation of benefits provided
	to the enrollee and the physician or provider in connection with a
	health care service or supply provided by a non-network physician
	or provider. The notice must include:
	(1) a statement of the billing prohibition under
	Section 1271.155, 1271.157, or 1271.158, as applicable;
	(2) the total amount the physician or provider may
	bill the enrollee under the enrollee's health benefit plan and an
	itemization of copayments, coinsurance, deductibles, and other
	amounts included in that total; and
	(3) for an explanation of benefits provided to the
	physician or provider, information required by commissioner rule
	advising the physician or provider of the availability of mediation
	or arbitration, as applicable, under Chapter 1467.
	(b) A health maintenance organization shall provide the
	explanation of benefits with the notice required by this section to
	a physician or health care provider not later than the date the
	health maintenance organization makes a payment under Section
	1271.155, 1271.157, or 1271.158, as applicable.
	SECTION 1.03. Section 1271.155, Insurance Code, is amended
	by amending Subsection (b) and adding Subsections (f), (g), and (h)
	to read as follows:
	(b) A health care plan of a health maintenance organization
	must provide the following coverage of emergency care:
	(1) a medical screening examination or other
	evaluation required by state or federal law necessary to determine
	whether an emergency medical condition exists shall be provided to
	covered enrollees in a hospital emergency facility or comparable
	facility;
	(2) necessary emergency care shall be provided to
	covered enrollees, including the treatment and stabilization of an
	emergency medical condition; [~~and~~]
	(3) services originated in a hospital emergency
	facility, freestanding emergency medical care facility, or
	comparable emergency facility following treatment or stabilization
	of an emergency medical condition shall be provided to covered
	enrollees as approved by the health maintenance organization,
	subject to Subsections (c) and (d); and
	(4) supplies related to a service described by this
	subsection shall be provided to covered enrollees.
	(f) For emergency care subject to this section or a supply
	related to that care, a health maintenance organization shall make
	a payment required by Subsection (a) directly to the non-network
	physician or provider not later than, as applicable:
	(1) the 30th day after the date the health maintenance
	organization receives an electronic clean claim as defined by
	Section 843.336 for those services that includes all information
	necessary for the health maintenance organization to pay the claim;
	or
	(2) the 45th day after the date the health maintenance
	organization receives a nonelectronic clean claim as defined by
	Section 843.336 for those services that includes all information
	necessary for the health maintenance organization to pay the claim.
	(g) For emergency care subject to this section or a supply
	related to that care, a non-network physician or provider or a
	person asserting a claim as an agent or assignee of the physician or
	provider may not bill an enrollee in, and the enrollee does not have
	financial responsibility for, an amount greater than an applicable
	copayment, coinsurance, and deductible under the enrollee's health
	care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the health maintenance organization; or
	(B) if applicable, a modified amount as
	determined under the health maintenance organization's internal
	appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the physician or provider under Chapter 1467.
	(h) This section may not be construed to require the
	imposition of a penalty under Section 843.342.
	SECTION 1.04. Subchapter D, Chapter 1271, Insurance Code,
	is amended by adding Sections 1271.157 and 1271.158 to read as
	follows:
	Sec. 1271.157. NON-NETWORK FACILITY-BASED PROVIDERS.
	(a) In this section, "facility-based provider" means a physician
	or provider who provides health care services to patients of a
	health care facility.
	(b) Except as provided by Subsection (d), a health
	maintenance organization shall pay for a covered health care
	service performed for or a covered supply related to that service
	provided to an enrollee by a non-network physician or provider who
	is a facility-based provider at the usual and customary rate or at
	an agreed rate if the provider performed the service at a health
	care facility that is a network provider. The health maintenance
	organization shall make a payment required by this subsection
	directly to the physician or provider not later than, as
	applicable:
	(1) the 30th day after the date the health maintenance
	organization receives an electronic clean claim as defined by
	Section 843.336 for those services that includes all information
	necessary for the health maintenance organization to pay the claim;
	or
	(2) the 45th day after the date the health maintenance
	organization receives a nonelectronic clean claim as defined by
	Section 843.336 for those services that includes all information
	necessary for the health maintenance organization to pay the claim.
	(c) Except as provided by Subsection (d), a non-network
	facility-based provider or a person asserting a claim as an agent or
	assignee of the provider may not bill an enrollee receiving a health
	care service or supply described by Subsection (b) in, and the
	enrollee does not have financial responsibility for, an amount
	greater than an applicable copayment, coinsurance, and deductible
	under the enrollee's health care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the health maintenance organization; or
	(B) if applicable, a modified amount as
	determined under the health maintenance organization's internal
	appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an enrollee elects to receive in writing in
	advance of the service with respect to each non-network physician
	or provider providing the service; and
	(2) for which a non-network physician or provider,
	before providing the service, provides a complete written
	disclosure to the enrollee that:
	(A) explains that the physician or provider does
	not have a contract with the enrollee's health benefit plan;
	(B) discloses projected amounts for which the
	enrollee may be responsible; and
	(C) discloses the circumstances under which the
	enrollee would be responsible for those amounts.
	(e) This section may not be construed to require the
	imposition of a penalty under Section 843.342.
	Sec. 1271.158. NON-NETWORK DIAGNOSTIC IMAGING PROVIDER OR
	LABORATORY SERVICE PROVIDER. (a) In this section, "diagnostic
	imaging provider" and "laboratory service provider" have the
	meanings assigned by Section 1467.001.
	(b) Except as provided by Subsection (d), a health
	maintenance organization shall pay for a covered health care
	service performed by or a covered supply related to that service
	provided to an enrollee by a non-network diagnostic imaging
	provider or laboratory service provider at the usual and customary
	rate or at an agreed rate if the provider performed the service in
	connection with a health care service performed by a network
	physician or provider. The health maintenance organization shall
	make a payment required by this subsection directly to the
	physician or provider not later than, as applicable:
	(1) the 30th day after the date the health maintenance
	organization receives an electronic clean claim as defined by
	Section 843.336 for those services that includes all information
	necessary for the health maintenance organization to pay the claim;
	or
	(2) the 45th day after the date the health maintenance
	organization receives a nonelectronic clean claim as defined by
	Section 843.336 for those services that includes all information
	necessary for the health maintenance organization to pay the claim.
	(c) Except as provided by Subsection (d), a non-network
	diagnostic imaging provider or laboratory service provider or a
	person asserting a claim as an agent or assignee of the provider may
	not bill an enrollee receiving a health care service or supply
	described by Subsection (b) in, and the enrollee does not have
	financial responsibility for, an amount greater than an applicable
	copayment, coinsurance, and deductible under the enrollee's health
	care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the health maintenance organization; or
	(B) if applicable, a modified amount as
	determined under the health maintenance organization's internal
	appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an enrollee elects to receive in writing in
	advance of the service with respect to each non-network physician
	or provider providing the service; and
	(2) for which a non-network physician or provider,
	before providing the service, provides a complete written
	disclosure to the enrollee that:
	(A) explains that the physician or provider does
	not have a contract with the enrollee's health benefit plan;
	(B) discloses projected amounts for which the
	enrollee may be responsible; and
	(C) discloses the circumstances under which the
	enrollee would be responsible for those amounts.
	(e) This section may not be construed to require the
	imposition of a penalty under Section 843.342.
	SECTION 1.05. Section 1301.0045(b), Insurance Code, is
	amended to read as follows:
	(b) Except as provided by Sections 1301.0052, 1301.0053,
	[~~and~~] 1301.155, 1301.164, and 1301.165, this chapter may not be
	construed to require an exclusive provider benefit plan to
	compensate a nonpreferred provider for services provided to an
	insured.
	SECTION 1.06. Section 1301.0053, Insurance Code, is amended
	to read as follows:
	Sec. 1301.0053. EXCLUSIVE PROVIDER BENEFIT PLANS:
	EMERGENCY CARE. (a) If an out-of-network [~~a nonpreferred~~]
	provider provides emergency care as defined by Section 1301.155 to
	an enrollee in an exclusive provider benefit plan, the issuer of the
	plan shall reimburse the out-of-network [~~nonpreferred~~] provider at
	the usual and customary rate or at a rate agreed to by the issuer and
	the out-of-network [~~nonpreferred~~] provider for the provision of the
	services and any supply related to those services. The insurer
	shall make a payment required by this subsection directly to the
	provider not later than, as applicable:
	(1) the 30th day after the date the insurer receives an
	electronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim; or
	(2) the 45th day after the date the insurer receives a
	nonelectronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim.
	(b) For emergency care subject to this section or a supply
	related to that care, an out-of-network provider or a person
	asserting a claim as an agent or assignee of the provider may not
	bill an insured in, and the insured does not have financial
	responsibility for, an amount greater than an applicable copayment,
	coinsurance, and deductible under the insured's exclusive provider
	benefit plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the insurer; or
	(B) if applicable, a modified amount as
	determined under the insurer's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(c) This section may not be construed to require the
	imposition of a penalty under Section 1301.137.
	SECTION 1.07. Subchapter A, Chapter 1301, Insurance Code,
	is amended by adding Section 1301.010 to read as follows:
	Sec. 1301.010. BALANCE BILLING PROHIBITION NOTICE. (a) An
	insurer shall provide written notice in accordance with this
	section in an explanation of benefits provided to the insured and
	the physician or health care provider in connection with a medical
	care or health care service or supply provided by an out-of-network
	provider. The notice must include:
	(1) a statement of the billing prohibition under
	Section 1301.0053, 1301.155, 1301.164, or 1301.165, as applicable;
	(2) the total amount the physician or provider may
	bill the insured under the insured's preferred provider benefit
	plan and an itemization of copayments, coinsurance, deductibles,
	and other amounts included in that total; and
	(3) for an explanation of benefits provided to the
	physician or provider, information required by commissioner rule
	advising the physician or provider of the availability of mediation
	or arbitration, as applicable, under Chapter 1467.
	(b) An insurer shall provide the explanation of benefits
	with the notice required by this section to a physician or health
	care provider not later than the date the insurer makes a payment
	under Section 1301.0053, 1301.155, 1301.164, or 1301.165, as
	applicable.
	SECTION 1.08. Section 1301.155, Insurance Code, is amended
	by amending Subsection (b) and adding Subsections (c), (d), and (e)
	to read as follows:
	(b) If an insured cannot reasonably reach a preferred
	provider, an insurer shall provide reimbursement for the following
	emergency care services at the usual and customary rate or at an
	agreed rate and at the preferred level of benefits until the insured
	can reasonably be expected to transfer to a preferred provider:
	(1) a medical screening examination or other
	evaluation required by state or federal law to be provided in the
	emergency facility of a hospital that is necessary to determine
	whether a medical emergency condition exists;
	(2) necessary emergency care services, including the
	treatment and stabilization of an emergency medical condition;
	[~~and~~]
	(3) services originating in a hospital emergency
	facility or freestanding emergency medical care facility following
	treatment or stabilization of an emergency medical condition; and
	(4) supplies related to a service described by this
	subsection.
	(c) For emergency care subject to this section or a supply
	related to that care, an insurer shall make a payment required by
	this section directly to the out-of-network provider not later
	than, as applicable:
	(1) the 30th day after the date the insurer receives an
	electronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim; or
	(2) the 45th day after the date the insurer receives a
	nonelectronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim.
	(d) For emergency care subject to this section or a supply
	related to that care, an out-of-network provider or a person
	asserting a claim as an agent or assignee of the provider may not
	bill an insured in, and the insured does not have financial
	responsibility for, an amount greater than an applicable copayment,
	coinsurance, and deductible under the insured's preferred provider
	benefit plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the insurer; or
	(B) if applicable, a modified amount as
	determined under the insurer's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(e) This section may not be construed to require the
	imposition of a penalty under Section 1301.137.
	SECTION 1.09. Subchapter D, Chapter 1301, Insurance Code,
	is amended by adding Sections 1301.164 and 1301.165 to read as
	follows:
	Sec. 1301.164. OUT-OF-NETWORK FACILITY-BASED PROVIDERS.
	(a) In this section, "facility-based provider" means a physician
	or health care provider who provides medical care or health care
	services to patients of a health care facility.
	(b) Except as provided by Subsection (d), an insurer shall
	pay for a covered medical care or health care service performed for
	or a covered supply related to that service provided to an insured
	by an out-of-network provider who is a facility-based provider at
	the usual and customary rate or at an agreed rate if the provider
	performed the service at a health care facility that is a preferred
	provider. The insurer shall make a payment required by this
	subsection directly to the provider not later than, as applicable:
	(1) the 30th day after the date the insurer receives an
	electronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim; or
	(2) the 45th day after the date the insurer receives a
	nonelectronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a facility-based provider or a person asserting a
	claim as an agent or assignee of the provider may not bill an
	insured receiving a medical care or health care service or supply
	described by Subsection (b) in, and the insured does not have
	financial responsibility for, an amount greater than an applicable
	copayment, coinsurance, and deductible under the insured's
	preferred provider benefit plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the insurer; or
	(B) if applicable, a modified amount as
	determined under the insurer's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an insured elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the insured that:
	(A) explains that the provider does not have a
	contract with the insured's preferred provider benefit plan;
	(B) discloses projected amounts for which the
	insured may be responsible; and
	(C) discloses the circumstances under which the
	insured would be responsible for those amounts.
	(e) This section may not be construed to require the
	imposition of a penalty under Section 1301.137.
	Sec. 1301.165. OUT-OF-NETWORK DIAGNOSTIC IMAGING PROVIDER
	OR LABORATORY SERVICE PROVIDER. (a) In this section, "diagnostic
	imaging provider" and "laboratory service provider" have the
	meanings assigned by Section 1467.001.
	(b) Except as provided by Subsection (d), an insurer shall
	pay for a covered medical care or health care service performed by
	or a covered supply related to that service provided to an insured
	by an out-of-network provider who is a diagnostic imaging provider
	or laboratory service provider at the usual and customary rate or at
	an agreed rate if the provider performed the service in connection
	with a medical care or health care service performed by a preferred
	provider. The insurer shall make a payment required by this
	subsection directly to the provider not later than, as applicable:
	(1) the 30th day after the date the insurer receives an
	electronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim; or
	(2) the 45th day after the date the insurer receives a
	nonelectronic clean claim as defined by Section 1301.101 for those
	services that includes all information necessary for the insurer to
	pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a diagnostic imaging provider or laboratory service
	provider or a person asserting a claim as an agent or assignee of
	the provider may not bill an insured receiving a medical care or
	health care service or supply described by Subsection (b) in, and
	the insured does not have financial responsibility for, an amount
	greater than an applicable copayment, coinsurance, and deductible
	under the insured's preferred provider benefit plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the insurer; or
	(B) if applicable, the modified amount as
	determined under the insurer's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an insured elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the insured that:
	(A) explains that the provider does not have a
	contract with the insured's preferred provider benefit plan;
	(B) discloses projected amounts for which the
	insured may be responsible; and
	(C) discloses the circumstances under which the
	insured would be responsible for those amounts.
	(e) This section may not be construed to require the
	imposition of a penalty under Section 1301.137.
	SECTION 1.10. Section 1551.003, Insurance Code, is amended
	by adding Subdivision (15) to read as follows:
	(15) "Usual and customary rate" means the relevant
	allowable amount as described by the applicable master benefit plan
	document or policy.
	SECTION 1.11. Subchapter A, Chapter 1551, Insurance Code,
	is amended by adding Section 1551.015 to read as follows:
	Sec. 1551.015. BALANCE BILLING PROHIBITION NOTICE.
	(a) The administrator of a managed care plan provided under the
	group benefits program shall provide written notice in accordance
	with this section in an explanation of benefits provided to the
	participant and the physician or health care provider in connection
	with a health care or medical service or supply provided by an
	out-of-network provider. The notice must include:
	(1) a statement of the billing prohibition under
	Section 1551.228, 1551.229, or 1551.230, as applicable;
	(2) the total amount the physician or provider may
	bill the participant under the participant's managed care plan and
	an itemization of copayments, coinsurance, deductibles, and other
	amounts included in that total; and
	(3) for an explanation of benefits provided to the
	physician or provider, information required by commissioner rule
	advising the physician or provider of the availability of mediation
	or arbitration, as applicable, under Chapter 1467.
	(b) The administrator shall provide the explanation of
	benefits with the notice required by this section to a physician or
	health care provider not later than the date the administrator
	makes a payment under Section 1551.228, 1551.229, or 1551.230, as
	applicable.
	SECTION 1.12. Subchapter E, Chapter 1551, Insurance Code,
	is amended by adding Sections 1551.228, 1551.229, and 1551.230 to
	read as follows:
	Sec. 1551.228. EMERGENCY CARE PAYMENTS. (a) In this
	section, "emergency care" has the meaning assigned by Section
	1301.155.
	(b) The administrator of a managed care plan provided under
	the group benefits program shall pay for covered emergency care
	performed by or a covered supply related to that care provided by an
	out-of-network provider at the usual and customary rate or at an
	agreed rate. The administrator shall make a payment required by
	this subsection directly to the provider not later than, as
	applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) For emergency care subject to this section or a supply
	related to that care, an out-of-network provider or a person
	asserting a claim as an agent or assignee of the provider may not
	bill a participant in, and the participant does not have financial
	responsibility for, an amount greater than an applicable copayment,
	coinsurance, and deductible under the participant's managed care
	plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	Sec. 1551.229. OUT-OF-NETWORK FACILITY-BASED PROVIDER
	PAYMENTS. (a) In this section, "facility-based provider" means a
	physician or health care provider who provides health care or
	medical services to patients of a health care facility.
	(b) Except as provided by Subsection (d), the administrator
	of a managed care plan provided under the group benefits program
	shall pay for a covered health care or medical service performed for
	or a covered supply related to that service provided to a
	participant by an out-of-network provider who is a facility-based
	provider at the usual and customary rate or at an agreed rate if the
	provider performed the service at a health care facility that is a
	participating provider. The administrator shall make a payment
	required by this subsection directly to the provider not later
	than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a facility-based provider or a person asserting a
	claim as an agent or assignee of the provider may not bill a
	participant receiving a health care or medical service or supply
	described by Subsection (b) in, and the participant does not have
	financial responsibility for, an amount greater than an applicable
	copayment, coinsurance, and deductible under the participant's
	managed care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that a participant elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the participant that:
	(A) explains that the provider does not have a
	contract with the participant's managed care plan;
	(B) discloses projected amounts for which the
	participant may be responsible; and
	(C) discloses the circumstances under which the
	participant would be responsible for those amounts.
	Sec. 1551.230. OUT-OF-NETWORK DIAGNOSTIC IMAGING PROVIDER
	OR LABORATORY SERVICE PROVIDER PAYMENTS. (a) In this section,
	"diagnostic imaging provider" and "laboratory service provider"
	have the meanings assigned by Section 1467.001.
	(b) Except as provided by Subsection (d), the administrator
	of a managed care plan provided under the group benefits program
	shall pay for a covered health care or medical service performed for
	or a covered supply related to that service provided to a
	participant by an out-of-network provider who is a diagnostic
	imaging provider or laboratory service provider at the usual and
	customary rate or at an agreed rate if the provider performed the
	service in connection with a health care or medical service
	performed by a participating provider. The administrator shall
	make a payment required by this subsection directly to the provider
	not later than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a diagnostic imaging provider or laboratory service
	provider or a person asserting a claim as an agent or assignee of
	the provider may not bill a participant receiving a health care or
	medical service or supply described by Subsection (b) in, and the
	participant does not have financial responsibility for, an amount
	greater than an applicable copayment, coinsurance, and deductible
	under the participant's managed care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, the modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that a participant elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the participant that:
	(A) explains that the provider does not have a
	contract with the participant's managed care plan;
	(B) discloses projected amounts for which the
	participant may be responsible; and
	(C) discloses the circumstances under which the
	participant would be responsible for those amounts.
	SECTION 1.13. Section 1575.002, Insurance Code, is amended
	by adding Subdivision (8) to read as follows:
	(8) "Usual and customary rate" means the relevant
	allowable amount as described by the applicable master benefit plan
	document or policy.
	SECTION 1.14. Subchapter A, Chapter 1575, Insurance Code,
	is amended by adding Section 1575.009 to read as follows:
	Sec. 1575.009. BALANCE BILLING PROHIBITION NOTICE.
	(a) The administrator of a managed care plan provided under the
	group program shall provide written notice in accordance with this
	section in an explanation of benefits provided to the enrollee and
	the physician or health care provider in connection with a health
	care or medical service or supply provided by an out-of-network
	provider. The notice must include:
	(1) a statement of the billing prohibition under
	Section 1575.171, 1575.172, or 1575.173, as applicable;
	(2) the total amount the physician or provider may
	bill the enrollee under the enrollee's managed care plan and an
	itemization of copayments, coinsurance, deductibles, and other
	amounts included in that total; and
	(3) for an explanation of benefits provided to the
	physician or provider, information required by commissioner rule
	advising the physician or provider of the availability of mediation
	or arbitration, as applicable, under Chapter 1467.
	(b) The administrator shall provide the explanation of
	benefits with the notice required by this section to a physician or
	health care provider not later than the date the administrator
	makes a payment under Section 1575.171, 1575.172, or 1575.173, as
	applicable.
	SECTION 1.15. Subchapter D, Chapter 1575, Insurance Code,
	is amended by adding Sections 1575.171, 1575.172, and 1575.173 to
	read as follows:
	Sec. 1575.171. EMERGENCY CARE PAYMENTS. (a) In this
	section, "emergency care" has the meaning assigned by Section
	1301.155.
	(b) The administrator of a managed care plan provided under
	the group program shall pay for covered emergency care performed by
	or a covered supply related to that care provided by an
	out-of-network provider at the usual and customary rate or at an
	agreed rate. The administrator shall make a payment required by
	this subsection directly to the provider not later than, as
	applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) For emergency care subject to this section or a supply
	related to that care, an out-of-network provider or a person
	asserting a claim as an agent or assignee of the provider may not
	bill an enrollee in, and the enrollee does not have financial
	responsibility for, an amount greater than an applicable copayment,
	coinsurance, and deductible under the enrollee's managed care plan
	that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	Sec. 1575.172. OUT-OF-NETWORK FACILITY-BASED PROVIDER
	PAYMENTS. (a) In this section, "facility-based provider" means a
	physician or health care provider who provides health care or
	medical services to patients of a health care facility.
	(b) Except as provided by Subsection (d), the administrator
	of a managed care plan provided under the group program shall pay
	for a covered health care or medical service performed for or a
	covered supply related to that service provided to an enrollee by an
	out-of-network provider who is a facility-based provider at the
	usual and customary rate or at an agreed rate if the provider
	performed the service at a health care facility that is a
	participating provider. The administrator shall make a payment
	required by this subsection directly to the provider not later
	than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a facility-based provider or a person asserting a
	claim as an agent or assignee of the provider may not bill an
	enrollee receiving a health care or medical service or supply
	described by Subsection (b) in, and the enrollee does not have
	financial responsibility for, an amount greater than an applicable
	copayment, coinsurance, and deductible under the enrollee's
	managed care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an enrollee elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the enrollee that:
	(A) explains that the provider does not have a
	contract with the enrollee's managed care plan;
	(B) discloses projected amounts for which the
	enrollee may be responsible; and
	(C) discloses the circumstances under which the
	enrollee would be responsible for those amounts.
	Sec. 1575.173. OUT-OF-NETWORK DIAGNOSTIC IMAGING PROVIDER
	OR LABORATORY SERVICE PROVIDER PAYMENTS. (a) In this section,
	"diagnostic imaging provider" and "laboratory service provider"
	have the meanings assigned by Section 1467.001.
	(b) Except as provided by Subsection (d), the administrator
	of a managed care plan provided under the group program shall pay
	for a covered health care or medical service performed for or a
	covered supply related to that service provided to an enrollee by an
	out-of-network provider who is a diagnostic imaging provider or
	laboratory service provider at the usual and customary rate or at an
	agreed rate if the provider performed the service in connection
	with a health care or medical service performed by a participating
	provider. The administrator shall make a payment required by this
	subsection directly to the provider not later than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a diagnostic imaging provider or laboratory service
	provider or a person asserting a claim as an agent or assignee of
	the provider may not bill an enrollee receiving a health care or
	medical service or supply described by Subsection (b) in, and the
	enrollee does not have financial responsibility for, an amount
	greater than an applicable copayment, coinsurance, and deductible
	under the enrollee's managed care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, the modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an enrollee elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the enrollee that:
	(A) explains that the provider does not have a
	contract with the enrollee's managed care plan;
	(B) discloses projected amounts for which the
	enrollee may be responsible; and
	(C) discloses the circumstances under which the
	enrollee would be responsible for those amounts.
	SECTION 1.16. Section 1579.002, Insurance Code, is amended
	by adding Subdivision (8) to read as follows:
	(8) "Usual and customary rate" means the relevant
	allowable amount as described by the applicable master benefit plan
	document or policy.
	SECTION 1.17. Subchapter A, Chapter 1579, Insurance Code,
	is amended by adding Section 1579.009 to read as follows:
	Sec. 1579.009. BALANCE BILLING PROHIBITION NOTICE.
	(a) The administrator of a managed care plan provided under this
	chapter shall provide written notice in accordance with this
	section in an explanation of benefits provided to the enrollee and
	the physician or health care provider in connection with a health
	care or medical service or supply provided by an out-of-network
	provider. The notice must include:
	(1) a statement of the billing prohibition under
	Section 1579.109, 1579.110, or 1579.111, as applicable;
	(2) the total amount the physician or provider may
	bill the enrollee under the enrollee's managed care plan and an
	itemization of copayments, coinsurance, deductibles, and other
	amounts included in that total; and
	(3) for an explanation of benefits provided to the
	physician or provider, information required by commissioner rule
	advising the physician or provider of the availability of mediation
	or arbitration, as applicable, under Chapter 1467.
	(b) The administrator shall provide the explanation of
	benefits with the notice required by this section to a physician or
	health care provider not later than the date the administrator
	makes a payment under Section 1579.109, 1579.110, or 1579.111, as
	applicable.
	SECTION 1.18. Subchapter C, Chapter 1579, Insurance Code,
	is amended by adding Sections 1579.109, 1579.110, and 1579.111 to
	read as follows:
	Sec. 1579.109. EMERGENCY CARE PAYMENTS. (a) In this
	section, "emergency care" has the meaning assigned by Section
	1301.155.
	(b) The administrator of a managed care plan provided under
	this chapter shall pay for covered emergency care performed by or a
	covered supply related to that care provided by an out-of-network
	provider at the usual and customary rate or at an agreed rate. The
	administrator shall make a payment required by this subsection
	directly to the provider not later than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) For emergency care subject to this section or a supply
	related to that care, an out-of-network provider or a person
	asserting a claim as an agent or assignee of the provider may not
	bill an enrollee in, and the enrollee does not have financial
	responsibility for, an amount greater than an applicable copayment,
	coinsurance, and deductible under the enrollee's managed care plan
	that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	Sec. 1579.110. OUT-OF-NETWORK FACILITY-BASED PROVIDER
	PAYMENTS. (a) In this section, "facility-based provider" means a
	physician or health care provider who provides health care or
	medical services to patients of a health care facility.
	(b) Except as provided by Subsection (d), the administrator
	of a managed care plan provided under this chapter shall pay for a
	covered health care or medical service performed for or a covered
	supply related to that service provided to an enrollee by an
	out-of-network provider who is a facility-based provider at the
	usual and customary rate or at an agreed rate if the provider
	performed the service at a health care facility that is a
	participating provider. The administrator shall make a payment
	required by this subsection directly to the provider not later
	than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a facility-based provider or a person asserting a
	claim as an agent or assignee of the provider may not bill an
	enrollee receiving a health care or medical service or supply
	described by Subsection (b) in, and the enrollee does not have
	financial responsibility for, an amount greater than an applicable
	copayment, coinsurance, and deductible under the enrollee's
	managed care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an enrollee elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the enrollee that:
	(A) explains that the provider does not have a
	contract with the enrollee's managed care plan;
	(B) discloses projected amounts for which the
	enrollee may be responsible; and
	(C) discloses the circumstances under which the
	enrollee would be responsible for those amounts.
	Sec. 1579.111. OUT-OF-NETWORK DIAGNOSTIC IMAGING PROVIDER
	OR LABORATORY SERVICE PROVIDER PAYMENTS. (a) In this section,
	"diagnostic imaging provider" and "laboratory service provider"
	have the meanings assigned by Section 1467.001.
	(b) Except as provided by Subsection (d), the administrator
	of a managed care plan provided under this chapter shall pay for a
	covered health care or medical service performed for or a covered
	supply related to that service provided to an enrollee by an
	out-of-network provider who is a diagnostic imaging provider or
	laboratory service provider at the usual and customary rate or at an
	agreed rate if the provider performed the service in connection
	with a health care or medical service performed by a participating
	provider. The administrator shall make a payment required by this
	subsection directly to the provider not later than, as applicable:
	(1) the 30th day after the date the administrator
	receives an electronic claim for those services that includes all
	information necessary for the administrator to pay the claim; or
	(2) the 45th day after the date the administrator
	receives a nonelectronic claim for those services that includes all
	information necessary for the administrator to pay the claim.
	(c) Except as provided by Subsection (d), an out-of-network
	provider who is a diagnostic imaging provider or laboratory service
	provider or a person asserting a claim as an agent or assignee of
	the provider may not bill an enrollee receiving a health care or
	medical service or supply described by Subsection (b) in, and the
	enrollee does not have financial responsibility for, an amount
	greater than an applicable copayment, coinsurance, and deductible
	under the enrollee's managed care plan that:
	(1) is based on:
	(A) the amount initially determined payable by
	the administrator; or
	(B) if applicable, a modified amount as
	determined under the administrator's internal appeal process; and
	(2) is not based on any additional amount determined
	to be owed to the provider under Chapter 1467.
	(d) This section does not apply to a nonemergency health
	care or medical service:
	(1) that an enrollee elects to receive in writing in
	advance of the service with respect to each out-of-network provider
	providing the service; and
	(2) for which an out-of-network provider, before
	providing the service, provides a complete written disclosure to
	the enrollee that:
	(A) explains that the provider does not have a
	contract with the enrollee's managed care plan;
	(B) discloses projected amounts for which the
	enrollee may be responsible; and
	(C) discloses the circumstances under which the
	enrollee would be responsible for those amounts.
	ARTICLE 2. OUT-OF-NETWORK CLAIM DISPUTE RESOLUTION
	SECTION 2.01. Section 1467.001, Insurance Code, is amended
	by adding Subdivisions (1-a), (2-c), (2-d), (4-b), and (6-a) and
	amending Subdivisions (2-a), (2-b), (3), (5), and (7) to read as
	follows:
	(1-a) "Arbitration" means a process in which an
	impartial arbiter issues a binding determination in a dispute
	between a health benefit plan issuer or administrator and an
	out-of-network provider or the provider's representative to settle
	a health benefit claim.
	(2-a) "Diagnostic imaging provider" means a health
	care provider who performs a diagnostic imaging service on a
	patient for a fee or interprets imaging produced by a diagnostic
	imaging service.
	(2-b) "Diagnostic imaging service" means magnetic
	resonance imaging, computed tomography, positron emission
	tomography, or any hybrid technology that combines any of those
	imaging modalities.
	(2-c) "Emergency care" has the meaning assigned by
	Section 1301.155.
	(2-d) [~~(2-b)~~] "Emergency care provider" means a
	physician, health care practitioner, facility, or other health care
	provider who provides and bills an enrollee, administrator, or
	health benefit plan for emergency care.
	(3) "Enrollee" means an individual who is eligible to
	receive benefits through a [~~preferred provider benefit plan or a~~]
	health benefit plan subject to this chapter [~~under Chapter 1551,~~
	~~1575, or 1579~~].
	(4-b) "Laboratory service provider" means an
	accredited facility in which a specimen taken from a human body is
	interpreted and pathological diagnoses are made or a physician who
	makes an interpretation of or diagnosis based on a specimen or
	information provided by a laboratory based on a specimen.
	(5) "Mediation" means a process in which an impartial
	mediator facilitates and promotes agreement between the health
	[~~insurer offering a preferred provider~~] benefit plan issuer or the
	administrator and an out-of-network [~~a facility-based~~] provider
	[~~or emergency care provider~~] or the provider's representative to
	settle a health benefit claim of an enrollee.
	(6-a) "Out-of-network provider" means a diagnostic
	imaging provider, emergency care provider, facility-based
	provider, or laboratory service provider that is not a
	participating provider for a health benefit plan.
	(7) "Party" means a health benefit plan issuer [an
	~~insurer~~] offering a health [~~a preferred provider~~] benefit plan, an
	administrator, or an out-of-network [~~a facility-based provider or~~
	~~emergency care~~] provider or the provider's representative who
	participates in a mediation or arbitration conducted under this
	chapter. [~~The enrollee is also considered a party to the~~
	~~mediation.~~]
	SECTION 2.02. Sections 1467.002, 1467.003, and 1467.005,
	Insurance Code, are amended to read as follows:
	Sec. 1467.002. APPLICABILITY OF CHAPTER. This chapter
	applies to:
	(1) a health benefit plan offered by a health
	maintenance organization operating under Chapter 843;
	(2) a preferred provider benefit plan, including an
	exclusive provider benefit plan, offered by an insurer under
	Chapter 1301; and
	(3) [~~(2)~~] an administrator of a health benefit plan,
	other than a health maintenance organization plan, under Chapter
	1551, 1575, or 1579.
	Sec. 1467.003. RULES. (a) The commissioner, the Texas
	Medical Board, and any other appropriate regulatory agency[~~, and~~
	~~the chief administrative law judge~~] shall adopt rules as necessary
	to implement their respective powers and duties under this chapter.
	(b) Section 2001.0045, Government Code, does not apply to a
	rule adopted under this chapter.
	Sec. 1467.005. REFORM. This chapter may not be construed to
	prohibit:
	(1) a health [~~an insurer offering a preferred~~
	~~provider~~] benefit plan issuer or administrator from, at any time,
	offering a reformed claim settlement; or
	(2) an out-of-network [~~a facility-based provider or~~
	~~emergency care~~] provider from, at any time, offering a reformed
	charge for health care or medical services or supplies.
	SECTION 2.03. Subchapter A, Chapter 1467, Insurance Code,
	is amended by adding Section 1467.006 to read as follows:
	Sec. 1467.006. BENCHMARKING DATABASE. (a) In this
	section, "geozip area" means an area that includes all zip codes
	with identical first three digits. For purposes of this section, a
	health care or medical service or supply provided at a location that
	does not have a zip code is considered to be provided in the geozip
	area closest to the location at which the service or supply is
	provided.
	(b) The commissioner shall select an organization to
	maintain a benchmarking database in accordance with this section.
	The organization may not:
	(1) be affiliated with a health benefit plan issuer or
	administrator or a physician, health care practitioner, or other
	health care provider; or
	(2) have any other conflict of interest.
	(c) The benchmarking database must contain information
	necessary to calculate, with respect to a health care or medical
	service or supply, for each geozip area in this state:
	(1) the 80th percentile of billed charges of all
	physicians or health care providers who are not facilities; and
	(2) the 50th percentile of rates paid to participating
	providers who are not facilities.
	(d) The commissioner may adopt rules governing the
	submission of information for the benchmarking database described
	by Subsection (c).
	SECTION 2.04. The heading to Subchapter B, Chapter 1467,
	Insurance Code, is amended to read as follows:
	SUBCHAPTER B. MANDATORY MEDIATION FOR OUT-OF-NETWORK FACILITIES
	SECTION 2.05. Subchapter B, Chapter 1467, Insurance Code,
	is amended by adding Sections 1467.050 and 1467.0505 to read as
	follows:
	Sec. 1467.050. APPLICABILITY OF SUBCHAPTER. (a) This
	subchapter applies only with respect to a health benefit claim
	submitted by an out-of-network provider that is a facility.
	(b) This subchapter does not apply to a health benefit claim
	for the professional or technical component of a physician service.
	Sec. 1467.0505. ESTABLISHMENT AND ADMINISTRATION OF
	MEDIATION PROGRAM. (a) The commissioner shall establish and
	administer a mediation program to resolve disputes over
	out-of-network provider charges in accordance with this
	subchapter.
	(b) The commissioner:
	(1) shall adopt rules, forms, and procedures necessary
	for the implementation and administration of the mediation program,
	including the establishment of a portal on the department's
	Internet website through which a request for mediation under
	Section 1467.051 may be submitted; and
	(2) shall maintain a list of qualified mediators for
	the program.
	SECTION 2.06. The heading to Section 1467.051, Insurance
	Code, is amended to read as follows:
	Sec. 1467.051. AVAILABILITY OF MANDATORY MEDIATION[;
	~~EXCEPTION~~].
	SECTION 2.07. Sections 1467.051(a) and (b), Insurance Code,
	are amended to read as follows:
	(a) An out-of-network provider or a health benefit plan
	issuer or administrator [~~An enrollee~~] may request mediation of a
	settlement of an out-of-network health benefit claim through a
	portal on the department's Internet website if:
	(1) there is an [~~the~~] amount billed by the provider and
	unpaid by the issuer or administrator [~~for which the enrollee is~~
	~~responsible to a facility-based provider or emergency care~~
	~~provider,~~] after copayments, deductibles, and coinsurance for
	which an enrollee may not be billed [~~, including the amount unpaid~~
	~~by the administrator or insurer, is greater than $500~~]; and
	(2) the health benefit claim is for:
	(A) emergency care; [or]
	(B) an out-of-network laboratory service; or
	(C) an out-of-network diagnostic imaging service
	[~~a health care or medical service or supply provided by a~~
	~~facility-based provider in a facility that is a preferred provider~~
	~~or that has a contract with the administrator~~].
	(b) If a person [~~Except as provided by Subsections (c) and~~
	~~(d), if an enrollee~~] requests mediation under this subchapter, the
	out-of-network [~~facility-based~~] provider [~~or emergency care~~
	~~provider,~~] or the provider's representative, and the health benefit
	plan issuer [~~insurer~~] or the administrator, as appropriate, shall
	participate in the mediation.
	SECTION 2.08. Section 1467.052, Insurance Code, is amended
	by amending Subsections (a) and (c) and adding Subsection (d) to
	read as follows:
	(a) Except as provided by Subsection (b), to qualify for an
	appointment as a mediator under this subchapter [~~chapter~~] a person
	must have completed at least 40 classroom hours of training in
	dispute resolution techniques in a course conducted by an
	alternative dispute resolution organization or other dispute
	resolution organization approved by the commissioner [~~chief~~
	~~administrative law judge~~].
	(c) A person may not act as mediator for a claim settlement
	dispute if the person has been employed by, consulted for, or
	otherwise had a business relationship with a health [~~an insurer~~
	~~offering the preferred provider~~] benefit plan issuer or
	administrator or a physician, health care practitioner, or other
	health care provider during the three years immediately preceding
	the request for mediation.
	(d) The commissioner shall immediately terminate the
	approval of a mediator who no longer meets the requirements under
	this subchapter and rules adopted under this subchapter to serve as
	a mediator.
	SECTION 2.09. Section 1467.053, Insurance Code, is amended
	by adding Subsection (b-1) and amending Subsection (d) to read as
	follows:
	(b-1) If the parties do not select a mediator by mutual
	agreement on or before the 30th day after the date the mediation is
	requested, the party requesting the mediation shall notify the
	commissioner, and the commissioner shall select a mediator from the
	commissioner's list of approved mediators.
	(d) The mediator's fees shall be split evenly and paid by
	the health benefit plan issuer [~~insurer~~] or administrator and the
	out-of-network [~~facility-based provider or emergency care~~]
	provider.
	SECTION 2.10. Section 1467.054, Insurance Code, is amended
	by amending Subsections (a) and (d) and adding Subsection (b-1) to
	read as follows:
	(a) An out-of-network provider or a health benefit plan
	issuer or administrator [~~enrollee~~] may request mandatory mediation
	under this subchapter [~~chapter~~].
	(b-1) The person who requests the mediation shall provide
	written notice on the date the mediation is requested in the form
	and manner provided by commissioner rule to:
	(1) the department; and
	(2) each other party.
	(d) In an effort to settle the claim before mediation, all
	parties must participate in an informal settlement teleconference
	not later than the 30th day after the date on which a person [~~the~~
	~~enrollee~~] submits a request for mediation under this subchapter
	[~~section~~].
	SECTION 2.11. Section 1467.055, Insurance Code, is amended
	by adding Subsections (c-1) and (k) and amending Subsections (g)
	and (i) to read as follows:
	(c-1) Information submitted by the parties to the mediator
	is confidential and not subject to disclosure under Chapter 552,
	Government Code.
	(g) A [~~Except at the request of an enrollee, a~~] mediation
	shall be held not later than the 180th day after the date of the
	request for mediation.
	(i) A health care or medical service or supply provided by
	an out-of-network [~~a facility-based~~] provider [~~or emergency care~~
	~~provider~~] may not be summarily disallowed. This subsection does
	not require a health benefit plan issuer [~~an insurer~~] or
	administrator to pay for an uncovered service or supply.
	(k) On agreement of all parties, any deadline under this
	subchapter may be extended.
	SECTION 2.12. Sections 1467.056(a), (b), and (d), Insurance
	Code, are amended to read as follows:
	(a) In a mediation under this subchapter [~~chapter~~], the
	parties shall[:
	[~~(1)~~] evaluate whether:
	(1) [~~(A)~~] the amount charged by the out-of-network
	[~~facility-based~~] provider [~~or emergency care provider~~] for the
	health care or medical service or supply is excessive; and
	(2) [~~(B)~~] the amount paid by the health benefit plan
	issuer [~~insurer~~] or administrator represents the usual and
	customary rate for the health care or medical service or supply or
	is unreasonably low[~~; and~~
	[~~(2)~~ ~~as a result of the amounts described by~~
	~~Subdivision (1), determine the amount, after copayments,~~
	~~deductibles, and coinsurance are applied, for which an enrollee is~~
	~~responsible to the facility-based provider or emergency care~~
	~~provider~~].
	(b) The out-of-network [~~facility-based~~] provider [or
	~~emergency care provider~~] may present information regarding the
	amount charged for the health care or medical service or supply.
	The health benefit plan issuer [~~insurer~~] or administrator may
	present information regarding the amount paid by the issuer
	[~~insurer~~] or administrator.
	(d) The goal of the mediation is to reach an agreement
	between [~~among the enrollee,~~] the out-of-network [~~facility-based~~]
	provider [~~or emergency care provider,~~] and the health benefit plan
	issuer [~~insurer~~] or administrator, as applicable, as to the amount
	paid by the issuer [~~insurer~~] or administrator to the out-of-network
	[~~facility-based~~] provider and [~~or emergency care provider,~~] the
	amount charged by the out-of-network [~~facility-based~~] provider [or
	~~emergency care provider, and the amount paid to the facility-based~~
	~~provider or emergency care provider by the enrollee~~].
	SECTION 2.13. Subchapter B, Chapter 1467, Insurance Code,
	is amended by adding Section 1467.0575 to read as follows:
	Sec. 1467.0575. RIGHT TO FILE ACTION. Not later than the
	45th day after the date that the mediator's report is provided to
	the department under Section 1467.060, either party to a mediation
	for which there was no agreement may file a civil action to
	determine the amount due to an out-of-network provider. A party may
	not bring a civil action before the conclusion of the mediation
	process under this subchapter.
	SECTION 2.14. Section 1467.060, Insurance Code, is amended
	to read as follows:
	Sec. 1467.060. REPORT OF MEDIATOR. Not later than the 45th
	day after the date the mediation concludes, the [~~The~~] mediator
	shall report to the commissioner and the Texas Medical Board or
	other appropriate regulatory agency:
	(1) the names of the parties to the mediation; and
	(2) whether the parties reached an agreement [~~or the~~
	~~mediator made a referral under Section 1467.057~~].
	SECTION 2.15. Chapter 1467, Insurance Code, is amended by
	adding Subchapter B-1 to read as follows:
	SUBCHAPTER B-1. MANDATORY BINDING ARBITRATION FOR OTHER PROVIDERS
	Sec. 1467.081. APPLICABILITY OF SUBCHAPTER. This
	subchapter applies only with respect to a health benefit claim
	submitted by an out-of-network provider who is not a facility.
	Sec. 1467.082. ESTABLISHMENT AND ADMINISTRATION OF
	ARBITRATION PROGRAM. (a) The commissioner shall establish and
	administer an arbitration program to resolve disputes over
	out-of-network provider charges in accordance with this
	subchapter.
	(b) The commissioner:
	(1) shall adopt rules, forms, and procedures necessary
	for the implementation and administration of the arbitration
	program, including the establishment of a portal on the
	department's Internet website through which a request for
	arbitration under Section 1467.084 may be submitted; and
	(2) shall maintain a list of qualified arbitrators for
	the program.
	Sec. 1467.083. ISSUE TO BE ADDRESSED; BASIS FOR
	DETERMINATION. (a) The only issue that an arbitrator may
	determine under this subchapter is the reasonable amount for the
	health care or medical services or supplies provided to the
	enrollee by an out-of-network provider.
	(b) The determination must take into account:
	(1) whether there is a gross disparity between the fee
	billed by the out-of-network provider and:
	(A) fees paid to the out-of-network provider for
	the same services or supplies rendered by the provider to other
	enrollees for which the provider is an out-of-network provider; and
	(B) fees paid by the health benefit plan issuer
	to reimburse similarly qualified out-of-network providers for the
	same services or supplies in the same region;
	(2) the level of training, education, and experience
	of the out-of-network provider;
	(3) the out-of-network provider's usual billed charge
	for comparable services or supplies with regard to other enrollees
	for which the provider is an out-of-network provider;
	(4) the circumstances and complexity of the enrollee's
	particular case, including the time and place of the provision of
	the service or supply;
	(5) individual enrollee characteristics;
	(6) the 80th percentile of all billed charges for the
	service or supply performed by a health care provider in the same or
	similar specialty and provided in the same geozip area as reported
	in a benchmarking database described by Section 1467.006;
	(7) the 50th percentile of rates for the service or
	supply paid to participating providers in the same or similar
	specialty and provided in the same geozip area as reported in a
	benchmarking database described by Section 1467.006;
	(8) the history of network contracting between the
	parties;
	(9) historical data for the percentiles described by
	Subdivisions (6) and (7); and
	(10) an offer made during the informal settlement
	teleconference required under Section 1467.084(d).
	Sec. 1467.084. AVAILABILITY OF MANDATORY ARBITRATION.
	(a) Not later than the 90th day after the date an out-of-network
	provider receives the initial payment for a health care or medical
	service or supply, the out-of-network provider or the health
	benefit plan issuer or administrator may request arbitration of a
	settlement of an out-of-network health benefit claim through a
	portal on the department's Internet website if:
	(1) there is a charge billed by the provider and unpaid
	by the issuer or administrator after copayments, coinsurance, and
	deductibles for which an enrollee may not be billed; and
	(2) the health benefit claim is for:
	(A) emergency care;
	(B) a health care or medical service or supply
	provided by a facility-based provider in a facility that is a
	participating provider;
	(C) an out-of-network laboratory service; or
	(D) an out-of-network diagnostic imaging
	service.
	(b) If a person requests arbitration under this subchapter,
	the out-of-network provider or the provider's representative, and
	the health benefit plan issuer or the administrator, as
	appropriate, shall participate in the arbitration.
	(c) The person who requests the arbitration shall provide
	written notice on the date the arbitration is requested in the form
	and manner prescribed by commissioner rule to:
	(1) the department; and
	(2) each other party.
	(d) In an effort to settle the claim before arbitration, all
	parties must participate in an informal settlement teleconference
	not later than the 30th day after the date on which the arbitration
	is requested. A health benefit plan issuer or administrator, as
	applicable, shall make a reasonable effort to arrange the
	teleconference.
	(e) The commissioner shall adopt rules providing
	requirements for submitting multiple claims to arbitration in one
	proceeding. The rules must provide that:
	(1) the total amount in controversy for multiple
	claims in one proceeding may not exceed $5,000; and
	(2) the multiple claims in one proceeding must be
	limited to the same out-of-network provider.
	Sec. 1467.085. EFFECT OF ARBITRATION AND APPLICABILITY OF
	OTHER LAW. (a) Notwithstanding Section 1467.004, an
	out-of-network provider or health benefit plan issuer or
	administrator may not file suit for an out-of-network claim subject
	to this chapter until the conclusion of the arbitration on the issue
	of the amount to be paid in the out-of-network claim dispute.
	(b) An arbitration conducted under this subchapter is not
	subject to Title 7, Civil Practice and Remedies Code.
	Sec. 1467.086. SELECTION AND APPROVAL OF ARBITRATOR.
	(a) If the parties do not select an arbitrator by mutual agreement
	on or before the 30th day after the date the arbitration is
	requested, the party requesting the arbitration shall notify the
	commissioner, and the commissioner shall select an arbitrator from
	the commissioner's list of approved arbitrators.
	(b) In selecting an arbitrator under this section, the
	commissioner shall give preference to an arbitrator who is
	knowledgeable and experienced in applicable principles of contract
	and insurance law and the health care industry generally.
	(c) In approving an individual as an arbitrator, the
	commissioner shall ensure that the individual does not have a
	conflict of interest that would adversely impact the individual's
	independence and impartiality in rendering a decision in an
	arbitration. A conflict of interest includes current or recent
	ownership or employment of the individual or a close family member
	in any health benefit plan issuer or administrator or physician,
	health care practitioner, or other health care provider.
	(d) The commissioner shall immediately terminate the
	approval of an arbitrator who no longer meets the requirements
	under this subchapter and rules adopted under this subchapter to
	serve as an arbitrator.
	Sec. 1467.087. PROCEDURES. (a) The arbitrator shall set a
	date for submission of all information to be considered by the
	arbitrator.
	(b) A party may not engage in discovery in connection with
	the arbitration.
	(c) On agreement of all parties, any deadline under this
	subchapter may be extended.
	(d) Unless otherwise agreed to by the parties, an arbitrator
	may not determine whether a health benefit plan covers a particular
	health care or medical service or supply.
	(e) The parties shall evenly split and pay the arbitrator's
	fees and expenses.
	(f) Information submitted by the parties to the arbitrator
	is confidential and not subject to disclosure under Chapter 552,
	Government Code.
	Sec. 1467.088. DECISION. (a) Not later than the 51st day
	after the date the arbitration is requested, an arbitrator shall
	provide the parties with a written decision in which the
	arbitrator:
	(1) determines whether the billed charge or the
	payment made by the health benefit plan issuer or administrator, as
	those amounts were last modified during the issuer's or
	administrator's internal appeal process, if the provider elects to
	participate, or the informal settlement teleconference required by
	Section 1467.084(d), as applicable, is the closest to the
	reasonable amount for the services or supplies determined in
	accordance with Section 1467.083(b); and
	(2) selects the amount determined to be closest under
	Subdivision (1) as the binding award amount.
	(b) An arbitrator may not modify the binding award amount
	selected under Subsection (a).
	(c) An arbitrator shall provide written notice in the form
	and manner prescribed by commissioner rule of the reasonable amount
	for the services or supplies and the binding award amount. If the
	parties settle before a decision, the parties shall provide written
	notice in the form and manner prescribed by commissioner rule of the
	amount of the settlement. The department shall maintain a record of
	notices provided under this subsection.
	Sec. 1467.089. EFFECT OF DECISION. (a) An arbitrator's
	decision under Section 1467.088 is binding.
	(b) Not later than the 45th day after the date of an
	arbitrator's decision under Section 1467.088, a party not satisfied
	with the decision may file an action to determine the payment due to
	an out-of-network provider.
	(c) In an action filed under Subsection (b), the court shall
	determine whether the arbitrator's decision is proper based on a
	substantial evidence standard of review.
	(d) Not later than the 30th day after the date of an
	arbitrator's decision under Section 1467.088, a health benefit plan
	issuer or administrator shall pay to an out-of-network provider any
	additional amount necessary to satisfy the binding award.
	SECTION 2.16. Subchapter C, Chapter 1467, Insurance Code,
	is amended to read as follows:
	SUBCHAPTER C. BAD FAITH PARTICIPATION [~~MEDIATION~~]
	Sec. 1467.101. BAD FAITH. (a) The following conduct
	constitutes bad faith participation [~~mediation~~] for purposes of
	this chapter:
	(1) failing to participate in the informal settlement
	teleconference under Section 1467.084(d) or an arbitration or
	mediation under this chapter;
	(2) failing to provide information the arbitrator or
	mediator believes is necessary to facilitate a decision or [an]
	agreement; or
	(3) failing to designate a representative
	participating in the arbitration or mediation with full authority
	to enter into any [~~mediated~~] agreement.
	(b) Failure to reach an agreement under Subchapter B is not
	conclusive proof of bad faith participation [~~mediation~~].
	Sec. 1467.102. PENALTIES. (a) Bad faith participation or
	otherwise failing to comply with Subchapter B-1 [~~mediation, by a~~
	~~party other than the enrollee,~~] is grounds for imposition of an
	administrative penalty by the regulatory agency that issued a
	license or certificate of authority to the party who committed the
	violation.
	(b) Except for good cause shown, on a report of a mediator
	and appropriate proof of bad faith participation under Subchapter B
	[~~mediation~~], the regulatory agency that issued the license or
	certificate of authority shall impose an administrative penalty.
	SECTION 2.17. Sections 1467.151(a), (b), and (c), Insurance
	Code, are amended to read as follows:
	(a) The commissioner and the Texas Medical Board or other
	regulatory agency, as appropriate, shall adopt rules regulating the
	investigation and review of a complaint filed that relates to the
	settlement of an out-of-network health benefit claim that is
	subject to this chapter. The rules adopted under this section must:
	(1) distinguish among complaints for out-of-network
	coverage or payment and give priority to investigating allegations
	of delayed health care or medical care;
	(2) develop a form for filing a complaint [~~and~~
	~~establish an outreach effort to inform enrollees of the~~
	~~availability of the claims dispute resolution process under this~~
	~~chapter~~]; and
	(3) ensure that a complaint is not dismissed without
	appropriate consideration[;
	[~~(4)~~ ~~ensure that enrollees are informed of the~~
	~~availability of mandatory mediation; and~~
	[~~(5)~~ ~~require the administrator to include a notice of~~
	~~the claims dispute resolution process available under this chapter~~
	~~with the explanation of benefits sent to an enrollee~~].
	(b) The department and the Texas Medical Board or other
	appropriate regulatory agency shall maintain information[:
	[~~(1)~~] on each complaint filed that concerns a claim,
	arbitration, or mediation subject to this chapter[~~; and~~
	[~~(2)~~ ~~related to a claim that is the basis of an~~
	~~enrollee complaint~~], including:
	(1) [~~(A)~~] the type of services or supplies that gave
	rise to the dispute;
	(2) [~~(B)~~] the type and specialty, if any, of the
	out-of-network [~~facility-based~~] provider [~~or emergency care~~
	~~provider~~] who provided the out-of-network service or supply;
	(3) [~~(C)~~] the county and metropolitan area in which
	the health care or medical service or supply was provided;
	(4) [~~(D)~~] whether the health care or medical service
	or supply was for emergency care; and
	(5) [~~(E)~~] any other information about:
	(A) [~~(i)~~] the health benefit plan issuer
	[~~insurer~~] or administrator that the commissioner by rule requires;
	or
	(B) [~~(ii)~~] the out-of-network [~~facility-based~~]
	provider [~~or emergency care provider~~] that the Texas Medical Board
	or other appropriate regulatory agency by rule requires.
	(c) The information collected and maintained [~~by the~~
	~~department and the Texas Medical Board and other appropriate~~
	~~regulatory agencies~~] under Subsection (b) [~~(b)(2)~~] is public
	information as defined by Section 552.002, Government Code, and may
	not include personally identifiable information or health care or
	medical information.
	ARTICLE 3. CONFORMING AMENDMENTS
	SECTION 3.01. Section 1456.003(a), Insurance Code, is
	amended to read as follows:
	(a) Each health benefit plan that provides health care
	through a provider network shall provide notice to its enrollees
	that:
	(1) a facility-based physician or other health care
	practitioner may not be included in the health benefit plan's
	provider network; and
	(2) a health care practitioner described by
	Subdivision (1) may balance bill the enrollee for amounts not paid
	by the health benefit plan unless the health care or medical service
	or supply provided to the enrollee is subject to a law prohibiting
	balance billing.
	SECTION 3.02. Section 1456.006, Insurance Code, is amended
	to read as follows:
	Sec. 1456.006. COMMISSIONER RULES; FORM OF DISCLOSURE. The
	commissioner by rule may prescribe specific requirements for the
	disclosure required under Section 1456.003. The form of the
	disclosure must be substantially as follows:
	NOTICE: "ALTHOUGH HEALTH CARE SERVICES MAY BE OR HAVE BEEN
	PROVIDED TO YOU AT A HEALTH CARE FACILITY THAT IS A MEMBER OF THE
	PROVIDER NETWORK USED BY YOUR HEALTH BENEFIT PLAN, OTHER
	PROFESSIONAL SERVICES MAY BE OR HAVE BEEN PROVIDED AT OR THROUGH THE
	FACILITY BY PHYSICIANS AND OTHER HEALTH CARE PRACTITIONERS WHO ARE
	NOT MEMBERS OF THAT NETWORK. YOU MAY BE RESPONSIBLE FOR PAYMENT OF
	ALL OR PART OF THE FEES FOR THOSE PROFESSIONAL SERVICES THAT ARE NOT
	PAID OR COVERED BY YOUR HEALTH BENEFIT PLAN UNLESS BALANCE BILLING
	FOR THOSE SERVICES IS PROHIBITED."
	SECTION 3.03. The following provisions of the Insurance
	Code are repealed:
	(1) Section 1456.004(c);
	(2) Section 1467.001(2);
	(3) Sections 1467.051(c) and (d);
	(4) Section 1467.0511;
	(5) Sections 1467.053(b) and (c);
	(6) Sections 1467.054(b), (c), (f), and (g);
	(7) Sections 1467.055(d) and (h);
	(8) Section 1467.057;
	(9) Section 1467.058;
	(10) Section 1467.059; and
	(11) Section 1467.151(d).
	ARTICLE 4. STUDY
	SECTION 4.01. Subchapter A, Chapter 38, Insurance Code, is
	amended by adding Section 38.004 to read as follows:
	Sec. 38.004. BALANCE BILLING PROHIBITION REPORT. (a) The
	department shall, each biennium, conduct a study on the impacts of
	S.B. No. 1264, Acts of the 86th Legislature, Regular Session, 2019,
	on Texas consumers and health coverage in this state, including:
	(1) trends in billed amounts for health care or
	medical services or supplies, especially emergency services,
	laboratory services, diagnostic imaging services, and
	facility-based services;
	(2) comparison of the total amount spent on
	out-of-network emergency services, laboratory services, diagnostic
	imaging services, and facility-based services by calendar year and
	provider type or physician specialty;
	(3) trends and changes in network participation by
	providers of emergency services, laboratory services, diagnostic
	imaging services, and facility-based services by provider type or
	physician specialty, including whether any terminations were
	initiated by a health benefit plan issuer, administrator, or
	provider;
	(4) trends and changes in the amounts paid to
	participating providers;
	(5) the number of complaints, completed
	investigations, and disciplinary sanctions for billing by
	providers of emergency services, laboratory services, diagnostic
	imaging services, or facility-based services of enrollees for
	amounts greater than the enrollee's responsibility under an
	applicable health benefit plan, including applicable copayments,
	coinsurance, and deductibles;
	(6) trends in amounts paid to out-of-network
	providers;
	(7) trends in the usual and customary rate for health
	care or medical services or supplies, especially emergency
	services, laboratory services, diagnostic imaging services, and
	facility-based services; and
	(8) the effectiveness of the claim dispute resolution
	process under Chapter 1467.
	(b) In conducting the study described by Subsection (a), the
	department shall collect settlement data and verdicts or
	arbitration awards, as applicable, from parties to mediation or
	arbitration under Chapter 1467.
	(c) The department may not publish a particular rate paid to
	a participating provider in the study described by Subsection (a),
	identifying information of a physician or health care provider, or
	non-aggregated study results. Information described by this
	subsection is confidential and not subject to disclosure under
	Chapter 552, Government Code.
	(d) The department:
	(1) shall collect data quarterly from a health benefit
	plan issuer or administrator subject to Chapter 1467 to conduct the
	study required by this section; and
	(2) may utilize any reliable external resource or
	entity to acquire information reasonably necessary to prepare the
	report required by Subsection (e).
	(e) Not later than December 1 of each even-numbered year,
	the department shall prepare and submit a written report on the
	results of the study under this section, including the department's
	findings, to the legislature.
	ARTICLE 5. TRANSITION AND EFFECTIVE DATE
	SECTION 5.01. The changes in law made by this Act apply only
	to a health care or medical service or supply provided on or after
	January 1, 2020. A health care or medical service or supply
	provided before January 1, 2020, is governed by the law in effect
	immediately before the effective date of this Act, and that law is
	continued in effect for that purpose.
	SECTION 5.02. This Act takes effect September 1, 2019.





	______________________________	______________________________
	President of the Senate	Speaker of the House

	I hereby certify that S.B. No. 1264 passed the Senate on
	April 16, 2019, by the following vote: Yeas 29, Nays 2; and that
	the Senate concurred in House amendments on May 24, 2019, by the
	following vote: Yeas 31, Nays 0.


	______________________________
	Secretary of the Senate

	I hereby certify that S.B. No. 1264 passed the House, with
	amendments, on May 21, 2019, by the following vote: Yeas 146,
	Nays 0, one present not voting.


	______________________________
	Chief Clerk of the House



	Approved:

	______________________________
	Date


	______________________________
	Governor