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.