28 TAC §§3.3701-3.3706
The Texas Department of Insurance proposes amendments to
§§3.3701 - 3.3704, and new §3.3705 and §3.3706, concerning
preferred provider plans. Elsewhere in this issue of the
Texas Register
the department proposes repeal of current §3.3705.
The proposed amendments and new sections implement legislation enacted by
the 75th Legislative session in Senate Bill 383 which amends Chapter 3, Subchapter
G of the Insurance Code by adding Article 3.70-3C (Preferred Provider Benefit
Plans) and House Bill 2846 which amends Chapter 3, Subchapter G of the Insurance
Code by adding Article 3.70-3C (Use of Advanced Practice Nurses and Physician
Assistants by Preferred Provider Benefit Plans), and Senate Bill 786 which
amends Insurance Code, Chapter 21, Subchapter E by adding Article 21.53K concerning
the provisions of services related to immunizations and vaccinations under
managed care plans. The proposed amendments and new sections restructure the
existing rules, §§3.3701-3.3705, by moving some of the existing
rules and incorporating them into other sections, altering the language of
the rules to comply with the legislative enactments, and reorganizing the
rules into individual sections relating to specific components of a preferred
provider benefit plan, thus rendering the rules better organized and easier
to read.
The proposed amendments to §3.3701 add advanced practice nurses and
physician assistants as preferred providers and indicate that Articles 3.70-3C
(Preferred Provider Benefit Plans), 3.70-3C (Use of Advanced Practice Nurses
and Physician Assistants by Preferred Provider Benefit Plans) and 21.53K,
which concerns the provisions of services related to immunizations and vaccinations
under managed care plans, are now applicable to the provisions of Subchapter
X.
The proposed amendments to §3.3702 redefine the words and terms used
in the subchapter to comply with amendments made to Chapter 3 of the Insurance
Code by the 75th Legislature and to eliminate definitions that are no longer
necessary. The proposed amendments to §3.3703 consolidate the contracting
requirements between insurers and physicians and health care providers, contained
in the existing rules, which were not affected by the enactment of Insurance
Code Article 3.70-3C (Preferred Provider Benefit Plans) and which are distributed
throughout several sections of the existing rules. The proposed amendments
to §3.3703 include additional contracting provisions required by Article
3.70-3C (Preferred Provider Benefit Plans) and two provisions required by
Insurance Code Article 21.53K which concern written protocols for immunizations
or vaccinations to be administered by a pharmacist. The proposed amendments
to §3.3704 consolidate the existing rules relating to an insured's freedom
of choice in the selection of providers, add additional requirements required
by Article 3.70-3C (Preferred Provider Benefit Plans), and delete provisions
concerning coverage information which are now set forth in proposed new §3.3705.
Proposed new §3.3705 sets forth readability and mandatory disclosure
requirements for preferred provider benefit plans issued pursuant to Chapter
3 of the Insurance Code. Proposed new §3.3706 sets forth procedures by
which a provider shall be notified of an insurer's sponsorship of a preferred
provider plan, how application for designation as a preferred provider can
be made, notification requirements for providers upon disapproval of an application
for designation as a preferred provider, notification requirements for a provider
upon of termination by an insurer from a plan as a preferred provider, and
mandatory review procedures available whenever a physician or health care
practitioner is not designated as a preferred provider or is terminated from
a plan by an insurer.
In addition, subsections (d) and (e) of proposed §3.3706 create expedited
and standard versions of the review processes required by statute. It should
be noted that the review process is already required by the existing rules.
These proposed changes involve only alterations to the time schedule required
by Article 3.70-3C (Preferred Provider Benefit Plans). The rules add a proposed
expedited process at subsection (e) of proposed §3.3706 which requires
a physician or health care practitioner requesting review from an insurer
to deliver all relevant material pertaining to the review within ten business
days of receipt of the notice of intent to terminate him or her as a preferred
provider. The insurer is required to render a decision within thirty calendar
days. The standard process, set forth in subsection (d) of proposed §3.3706,
allows the provider twenty calendar days in which to submit materials pertaining
to the review and the insurer sixty calendar days within which to render a
decision.
Kim Stokes, Associate Commissioner, Life/Health and Managed Care Division,
has determined that for each year of the first five years the proposed amendments
and new sections will be in effect there will be no measurable effect on state
or local government, local employment, or the local economy as a result of
the proposal.
Ms. Stokes has also determined that for each year of the first five years
the proposed sections are in effect, the public benefits anticipated as a
result of the proposed sections will be increased consumer and provider awareness
of the requirements that must be met by insurers who sponsor preferred provider
plans regulated under Chapter 3 of the Insurance Code; increased accessibility
by insureds to immunizations and vaccinations; and ultimately, improved ability
by providers and citizens to make informed choices about health care services.
Subsection (f) of proposed §3.3706 requires an insurer to maintain confidentiality
of patient identity and records involved in a review requested by a provider
under this subsection. State law already mandates that an insurer maintain
confidentiality of all patient identities and records. The new section clarifies
that the already existing confidentiality requirements apply to the review
processes as well.
The proposed amendments add terms under §3.3703 which must be included
in a contract between an insurer and a preferred provider that reflect changes
required by Article 3.70-3C (Preferred Provider Benefit Plans) as to how preferred
provider benefit plans are administered. For example, subsection (a)(19) of
proposed §3.3703 requires a contract to contain a provision that discloses
that a physician or health care practitioner has a right to request a review
of their termination as a preferred provider by an insurer. The statute requires
only that such notice be given upon termination. However, §3.3703 requires
that all affected parties be made aware of their rights and responsibilities
concerning the review process before the need to access the process arises.
As a result, the process will function more smoothly for insurers and providers,
and they will be able to more efficiently utilize their resources. Therefore,
it is the department's position that by requiring specific contract provisions
that track the general contract requirements of Art. 3.70-3C (Preferred Provider
Benefit Plans), all persons required to comply with these rules will be benefited.
Ms. Stokes estimates that all costs to persons required to comply with
the proposed amended sections and the new sections are the result of the legislative
enactment of Insurance Code Articles 3.70-3C (Preferred Provider Benefit Plans),
3.70-3C (Use of Advanced Practice Nurses and Physician Assistants by Preferred
Provider Benefit Plans) and 21.53K and not the result of these proposed rules.
Article 3.70-3C (Preferred Provider Benefit Plans) requires each affected
insurer, regardless of whether it is considered to be a small or large business,
to comply with the provisions contained therein. Therefore, it is the department's
position that these rules are mandated by the underlying state statute, and
considering the statute's purposes, it would be neither legal nor feasible
to reduce their effect on small businesses as doing so would prevent insureds
and providers, and potential insureds and providers, from benefiting from
these provisions.
Comments on the proposal must be submitted within 30 days after publication
of the proposed amendments and new sections in the Texas Register to Lynda
H. Nesenholtz, General Counsel and Chief Clerk, Mail Code 113-1C, Texas Department
of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. An additional copy
of the comment must be submitted to Linda Von Quintus, Deputy Commissioner,
Regulation and Safety Division, Mail Code 107-2A, Texas Department of Insurance,
P. O. Box 149104, Austin, Texas, 78714-9104. Any requests for a public hearing
should be submitted separately to the Office of the Chief Clerk.
The amendments and new sections are proposed under the Insurance
Code, Chapter 3, Subchapter X, as amended by the 75th Legislature in Senate
Bill 383 and House Bill 2846, Chapter 21, Subchapter E, as amended by the
75th Legislature in Senate Bill 786, and Article 1.03A. Insurance Code Article
3.70-3C (Preferred Provider Benefit Plans), Section 9 provides that the commissioner
shall adopt rules and regulations as necessary to implement the provisions
of this article and to ensure reasonable accessibility and availability of
preferred provider and basic level benefits to Texas citizens. Insurance Code
Article 1.03A provides that the Commissioner of Insurance may adopt rules
necessary for the conduct and execution of the duties and functions of the
Texas Department of Insurance only as authorized by a statute.
The following statutes are affected by this proposal: Insurance Code Articles
3.42, 3.51-6, 3.70, 3.70-2(B), 3.70-3C, 21.21-6, 21.21-8, 21.52, and 21.53K.
Insurance Code Chapters 20, 22 and 26.
Application
[
Scope
].
(a)
The sections of this subchapter apply to
any
[
a
] preferred provider
benefit
plan [
in which an insurer as defined in §3.3702 of this title (relating to
Definitions) provides through its health insurance policy for the payment
of a level of coverage which is different from the basic level of coverage
provided by the health insurance policy, if the insured uses a preferred provider.
The sections of this subchapter do not apply to nor do they sanction any plan
arranged or provided for by any provider, employer, union, third-party entity,
or any person or entity other than an insurer authorized to engage in the
business of health insurance in this state
]. The sections of this subchapter
do not apply to provisions for dental care benefits in any health insurance
policy. This subchapter is not an interpretation of and has no application
to any law requiring licensure to act as a principal or agent in the insurance
or related businesses including, but not limited to, health maintenance organizations.
(b)
The provisions of this subchapter shall be
subject to the Insurance Code[
,
] Articles 3.70-2(B)
, 3.70-3C
(Preferred Provider Benefit Plans), 3.70-3C (Use of Advanced Practice Nurses
and Physician Assistants by Preferred Provider Plans),
21.52, and
21.53K
as they relate to insurers and the practitioners named therein.
(c)
These sections do not create a private cause
of action for damages or create a standard of care, obligation or duty that
provides a basis for a private cause of action. These sections do not abrogate
a statutory or common law cause of action, administrative remedy or defense
otherwise available.
(d)
If any terms, sections or subsections of this
subchapter are determined by a court of competent jurisdiction to be inconsistent
with the Insurance Code or invalid for any reason, the remaining terms, sections
or subsections of this subchapter will continue in effect.
§3.3702.Definitions.
The following words and terms, when used in this subchapter, have the
following meanings, unless the context clearly indicates otherwise.
(1)
Contract holder -- An individual
who holds
an individual health insurance policy,
or
an
organization
which holds
a
[
an individual or
] group health insurance
policy.
(2)
Emergency care -- As defined in Insurance
Code, Article
3.70-3C §1(1) (Preferred Provider Benefit Plans)
[
3.70-2(I)
].
(3)
Health care provider or provider --
As defined in Insurance Code Article 3.70-3C §1(3) (Preferred Provider
Benefit Plans)
[
Any practitioner (other than a physician), institutional
provider, or any other person or organization that furnishes health care services,
and that is licensed or otherwise authorized to practice in this state
].
(4)
Health insurance policy --
As defined
in Insurance Code Article 3.70-3C §1(2) (Preferred Provider Benefit Plans)
[
A group or individual insurance policy or contract providing
benefits for medical or surgical expenses incurred as a result of an accident
or sickness, which is approved under the Insurance Code, Article 3.42
].
(5)
Health Maintenance Organization (HMO)
-- As defined in Insurance Code Article 20A.02(n).
(6)
Hospital --
As defined in Insurance
Code Article 3.70-3C §1(4) (Preferred Provider Benefit Plans)
[
A licensed public or private institution as defined by the Texas Hospital
Licensing Law, Texas Civil Statutes, Article 4437f, or by the Texas Mental
Health Code, §88, Texas Civil Statutes, Article 5547-88
].
(7)
Institutional provider --
As defined
in Insurance Code Article 3.70-3C §1(5) (Preferred Provider Benefit Plans)
[
A hospital, nursing home, or any other medical or health-related
service facility caring for the sick or injured or providing care for other
coverage which may be provided in a health insurance policy
].
(8)
Insurer --
As defined in Insurance
Code Article 3.70-3C §1(6) (Preferred Provider Benefit Plans)
[
Any life, health, and accident; health and accident; or health insurance company
or company operating pursuant to the Insurance Code, Chapters 3, 10, 20, 22,
and 26, as amended, authorized to issue, deliver, or issue for delivery in
this state health insurance policies approved under the Insurance Code, Article
3.42
].
[
Medical care
--Furnishing
those services defined as the practice of medicine in the Medical Practice
Act of Texas, Texas Civil Statutes, Article 4495b].
(9)
Physician --
As defined in Insurance
Code Article 3.70-3C §1(8) (Preferred Provider Benefit Plans)
[
Anyone licensed to practice medicine in the State of Texas
].
(10)
Practitioner --
As defined in Insurance
Code Article 3.70-3C §1(9) (Preferred Provider Benefit Plans)
[
One who practices a healing art and is specified in the Insurance Code, Article
3.70-2(B) or 21.52
].
(11)
Preferred provider --
As defined
in Insurance Code Article 3.70-3C §1(1) (Use of Advanced Practice Nurses
and Physician Assistants by Preferred Provider Plans)
[
A physician,
practitioner, hospital, institutional provider, or health care provider, or
an organization of physicians or health care providers, who contracts with
an insurer to provide medical care or health care to insureds covered by a
health insurance policy a authorized by law and this subchapter
].
(12)
Preferred Provider Benefit Plan
-- As defined in Insurance Code Article 3.70-3C §1(2) (Use of Advanced
Practice Nurses and Physician Assistants by Preferred Provider Plans).
(13)
Prospective insured --
As defined
in Insurance Code Article 3.70-3C §1(11) (Preferred Provider Benefit
Plans)
[
For group coverage, an individual, including dependents,
eligible for coverage under a health insurance policy issued to the group.
For individual coverage, an individual, including dependents, eligible for
coverage who has expressed an interest in purchasing an individual health
insurance policy
].
(14)
Quality assessment --
As defined
in Insurance Code Article 3.70-3C §1(12) (Preferred Provider Benefit
Plans)
[
A mechanism which is in place or put into place and utilized
by an insurer for the purposes of evaluating, monitoring, or improving the
quality and effectiveness of the medical care delivered by physicians or health
care providers to persons covered by a health insurance policy to insure that
such care delivered is consistent with that delivered by an ordinary, reasonable,
prudent physician or health care provider under the same or similar circumstances
].
(15)
Service area --
As defined in Insurance
Code Article 3.70-3C (Preferred Provider Benefit Plans) §1(13)
[
A geographic area or areas set forth in the health insurance policy
or preferred provider contract
].
(16)
Utilization Review --
As defined
in Insurance Code Article 21.58A §2(20)
[
A system for prospective
or concurrent review of the medical necessity and appropriateness of health
care services being provided or proposed to be provided to an individual within
this state. Utilization review shall not include elective requests for clarification
of coverage
].
Contracting
Requirements.
(a)
An insurer marketing a preferred provider
benefit plan must contract with physicians and health care providers to assure
that all medical and health care services and items contained in the package
of benefits for which coverage is provided, including treatment of illnesses
and injuries, will be provided under the plan in a manner that assures both
availability and accessibility of adequate personnel, specialty care, and
facilities. Each contract must meet the following requirements
[
A health insurance policy that includes different benefits from the basic
level of coverage for use of preferred providers shall not be considered unjust
under the Insurance Code, Article 3.42, or unfair discrimination under the
Insurance Code, Articles 21.21-6 or 21.21-8, or to violate Article 3.70-2(B)
or 21.52 of the Insurance Code, if
]:
[
(1)
physicians, practitioners,
institutional providers and health care providers other than physicians, practitioners
and institutional providers, if such other health care providers are included
by the insurer as preferred providers, licensed to treat injuries or illnesses
or to provide services covered by the health insurance policy that comply
with the terms and conditions established by the insurer for designation as
preferred providers may apply for and shall be afforded a fair, reasonable,
and equivalent opportunity to become preferred providers. Such designation
shall not be unreasonably withheld. If such designation is withheld relating
to a physician, the insurer shall provide a reasonable review mechanism that
incorporates an advisory role only by a physician panel. Any recommendation
of the physician panel shall be provided upon request to the affected physician.
In the event of an insurer determination which is contrary to any recommendation
of the physician panel, a written explanation of the insurer's determination
shall also be provided upon request to the affected physician. The panel shall
be composed of not less than three physicians selected by the insurer from
a list of those physicians contracting with the insurer, and shall include
one member who is a physician in the same or similar specialty, if available.
The list of physicians is to be provided to the insurer by those physicians
contracting with the insurer in the applicable service area. The insurer must
give a physician or health care provider not designated upon initial application
written reasons for denial of the designation; however, unless otherwise limited
by Insurance Code, Article 21.52B, this subsection does not prohibit an insurer
from rejecting an application from a physician or health care provider based
on the determination that the preferred provider plan has sufficient qualified
providers. Any insurer, when sponsoring a preferred provider plan, shall notify
immediately all physicians and practitioners in the geographic area covered
by the plan of its intent to offer such a plan by publication, or in writing
to each physician and practitioner of the opportunities to participate. Such
notice and opportunities to noncontracting physicians and practitioners as
described above shall be provided on a yearly basis thereafter. The insurer
shall, upon request, make available information concerning the application
process and qualification requirements for participation as a provider in
the plan to any physician or health care provider;]
[
(2)
the terms and conditions
of the contract between the insurer and the preferred providers shall be reasonable,
shall not violate any law or any section of this subchapter, shall be based
solely on economic, quality, and accessibility considerations, and shall be
applied in accordance with reasonable business judgment.]
(1)
[
Exclusive preferred provider
]
A contract
[
contracts
]
between a preferred provider
and an insurer shall not restrict
[
under which
] a physician
or health care provider [
is prevented
] from contracting with
other insurers, preferred provider plans, preferred provider organizations,
or HMOs
[
others to provide similar services shall not be permitted
under this subchapter
].
(2)
Any term or condition limiting participation
on the basis of quality,
contained in a contract between a preferred
provider and an insurer,
shall be consistent with established standards
of care for the profession.
(3)
In the case of physicians or practitioners
with hospital or institutional
provider
privileges who provide
a significant portion of care in a hospital or institutional
provider
setting,
a contract between a preferred provider and an insurer
may contain
terms and conditions
which
[
may
] include
the possession of practice privileges at preferred hospitals or institutions,
except that if no preferred hospital or institution offers privileges to members
of a class of physicians or practitioners,
the contract may not provide
that
the lack of hospital or institutional
provider
privileges
may
[
shall not
] be a basis for denial of participation
as a preferred provider
to such
physicians or
practitioners
of that class.
(4)
A contract between an
[
No
] insurer
and
[
may contract with
] a hospital
or institutional provider
shall not
[
which
], as a condition
of staff membership or privileges,
require
[
requires
]
a
physician or
practitioner to enter into a preferred provider
contract.
(5)
A contract between a
[
The
] preferred provider
and an insurer
may
provide that
the preferred provider will
[
agree with an insurer to
] not
bill the insured for unnecessary care, if a physician or practitioner panel
has determined the care was unnecessary, but the
contract
[
plan
] shall not require the preferred provider to pay hospital, institutional,
laboratory, x-ray, or like charges resulting from the provision of services
lawfully ordered by a physician or health care provider, even though such
service may be determined to be unnecessary
.
[
;
]
[
(3)
under the preferred provider plan,
the insured shall be provided with direct and reasonable access to all classes
of physicians and practitioners licensed to treat illnesses or injuries and
to provide services covered by the health insurance policy.
]
(6)
A contract between a preferred provider
and
an insurer
[
There
] shall
not
[
be no
]:
(A)
contain restrictions on the classes of
physicians and practitioners who may refer an insured to another physician
or practitioner; or
[
requirement that the insured be referred by
a physician or practitioner of another class or by a subspecialty within the
same class, except that a plan may provide for a different level of coverage
for use of a nonpreferred provider if a referral is made by a preferred provider.
The
]
(B)
require a
referring physician or
practitioner [
may not be required
] to bear the expenses of a referral
for specialty care in or out of the preferred provider panel. Savings from
cost-effective utilization of health services by contracting physicians or
health care providers may be shared with physicians or health care providers
in the aggregate.
(7)
A contract between a preferred
provider and an
[
An
] insurer shall not
contain
[
use
] any financial
incentives
[
incentive or make
payment
] to a physician or a health care provider which
act
[
acts
] directly or indirectly as an inducement to limit medically
necessary services.
This subsection does not prohibit the savings from
cost-effective utilization of health services by contracting physicians or
health care providers from being shared with physicians or health care providers
in the aggregate
.
(8)
A contract between a physician, physicians'
group, or practitioner and an insurer shall have a mechanism for the resolution
of complaints initiated by an insured, a physician, physicians' group, or
practitioner which provides for reasonable due process including, in an advisory
role only, a review panel selected by the manner set forth in subsection (b)
of §3.3706 of this title (relating to Designation as a Preferred Provider,
Decision to Withhold Designation, Termination of a Preferred Provider, Review
of Process).
(9)
A contract between a preferred provider
and an insurer shall not require any health care provider, physician, or physicians'
group to execute hold harmless clauses that shift an insurer's tort liability
resulting from acts or omissions of the insurer to the preferred provider.
(10)
A contract between a preferred provider
and an insurer shall include a provision that requires a preferred provider
who is compensated by the insurer on a discounted fee basis to bill the insured
only on the discounted fee and not the full charge.
(11)
A contract between a preferred provider
and a insurer shall include a provision for payment to the physician or health
care provider for covered services that are rendered to insureds that complies
with Insurance Code Article 3.70-3C (Preferred Provider Benefit Plans) §3(m).
(12)
A contract between a preferred provider
and an insurer shall include provisions requiring the provider to comply with
Insurance Code Article 3.70-3C (Preferred Provider Benefit Plans) §4
which relates to Continuity of Care.
(13)
A contract between a preferred provider
and an insurer shall not prohibit, penalize, permit retaliation against, or
terminate a provider for communicating with any individual listed in Insurance
Code Article 3.70-3C (Preferred Provider Benefit Plans) §7(c) about any
of the matters set forth therein.
(14)
A contract between a preferred provider
and an insurer conducting, using, or relying upon economic profiling to admit
physicians or health care providers to a plan or to terminate physicians or
health care providers from a plan shall include provisions informing the provider
of the insurer's obligation to comply with Insurance Code Article 3.70-3C
(Preferred Provider Benefit Plans) §3(h).
(15)
A contract between a preferred provider
and an insurer that engages in quality assessment shall disclose in the contract
all requirements of Insurance Code Article 3.70-3C (Preferred Provider Benefit
Plans) §3(i).
(16)
A contract between a preferred provider
and an insurer shall not require a physician to issue an immunization or vaccination
protocol for an immunization or vaccination to be administered to an insured
by a pharmacist.
(17)
A contract between a preferred provider
and an insurer shall not prohibit a pharmacist from administering immunizations
or vaccinations if such immunizations or vaccinations are administered in
accordance with the Texas Pharmacy Act, Article 4542a-1, Texas Civil Statutes
and rules promulgated thereunder.
(18)
A contract between a preferred provider
and an insurer shall include provisions notifying the provider of the responsibility
of a physician or health care provider that voluntarily terminates the contract
to provide reasonable notice to the insured, and of the insurer's responsibility
to provide assistance to the physician or health care provider in doing so
as required by Insurance Code Article 3.70-3C (Preferred Provider Benefit
Plans) §6(e)(2).
(19)
A contract between a preferred provider
and an insurer must disclose the provider's right to written notice upon termination
by the insurer, and in the case of termination of a physician or practitioner,
the right to request a review, as set forth in §3.3706(c) of this title
(relating to Designation as a Preferred Provider, Decision to Withhold Designation,
Termination of a Preferred Provider, Review of Process).
(b)
Any contract between a preferred provider
and an insurer shall explicitly include all of the terms required to be included
in a contract by subsection (a) of this section and any applicable provision
of the Insurance Code.
(c)
[
(4)
]
In
[
in
]
addition to all other contract rights, violations of these rules shall be
treated for purposes of complaint and action in accordance with the Insurance
Code[
,
] Article 21.21-2, and the provisions of that article shall
be utilized insofar as practicable, as it relates to the power of the department,
hearings, orders, enforcement, and penalties
.
[
;
]
[
(5)
The insurer offering preferred
provider plans shall, upon request, file with the Texas Department of Insurance
all data and information on activities of preferred provider plans in order
to assess the impact of these plans on:]
[
(A)
quality of care;]
[
(B)
access to care;]
[
(C)
cost of care;]
[
(D)
the availability and affordability of accident
and health insurance; and]
[
(E)
the provision of care of the uninsurable or
medically indigent.]
(d)
An insurer may enter into an agreement
with a preferred provider organization for the purpose of offering a network
of preferred providers, provided that it remains the insurer's responsibility
to:
(1)
meet the requirements of Insurance Code
Article 3.70-3C ("Preferred Provider Benefit Plans") and this subchapter;
or
(2)
ensure that the requirements of Insurance
Code Article 3.70-3C (Preferred Provider Benefit Plans) and this subchapter
are met
.
§3.3704.Freedom of Choice ; Availability of Preferred Providers .
(a)
A preferred provider benefit plan shall
not be considered unjust under the Insurance Code Article 3.42, or unfair
discrimination under the Insurance Code Articles 21.21-6 or 21.21-8, or to
violate Articles 3.70-2(B) or 21.52 of the Insurance Code provided that:
(1)
pursuant to the Insurance Code,
Article
3.70-3C §3 (Preferred Provider Benefit Plans)
, Article 3.51-6,
§3, and Article 3.70-3(A)(9), no
preferred provider benefit plan
[
health insurance policy
] may require that a service be
rendered by a particular hospital, physician, or practitioner;
(2)
insureds shall be provided with direct
and reasonable access to all classes of physicians and practitioners licensed
to treat illnesses or injuries and to provide services covered by the preferred
provider benefit plan;
(3)
insureds shall have the right to
treatment and diagnostic techniques as prescribed by a physician or other
health care provider included in the preferred provider benefit plan;
(4)
insureds shall have the right to
continuity of care as set forth in Article 3.70-3C, §4 (Preferred Provider
Benefit Plans);
(5)
insureds shall have the right to
emergency care services as set forth in Article 3.70-3C, §5 (Preferred
Provider Benefit Plans);
[
A health insurance policy that includes
different benefits from the basic level of coverage for use of preferred providers
shall not be considered to unlawfully restrict freedom of choice in the selection
of physicians or health care provider by insureds provided.
]
(6)
[
(1)
] the basic level of coverage,
excluding a reasonable difference in deductibles, is not more than 30% less
than the higher level of coverage. A reasonable difference in deductibles
shall be determined considering the benefits of each individual policy;
(7)
[
(2)
] the rights of an insured
to exercise full freedom of choice in the selection of
a physician or
provider
[
physician, hospital, or practitioner
] are not restricted
by the insurer[
, and physicians and health care providers shall be free
to join one or more insurance plans or other preferred provider plans or HMOs
whether or not sponsored by an insurance carrier or HMO
];
[
(3)
the insurer shall establish
reasonable procedures for assuring a transition of insureds to physicians
or health care providers and for continuity of treatment, including providing
reasonable advance notice to the insured of the impending termination from
the plan of a physician or health care provider who is currently treating
the insured and making available to the insured a current listing of preferred
providers, in the event of termination of a preferred provider's participation
in the plan. Each contract between an insurer and a physician or health care
provider must provide that the termination of a preferred provider's participation
in the plan, except for reason of medical competence or professional behavior,
shall not release the physician or health care provider from the generally
recognized obligation to treat the insured and cooperate in arranging for
appropriate referrals or release the obligation of the insurer to reimburse
the physician or health care provider or, if applicable, the insured at the
same preferred provider rate if, at the time of preferred provider termination,
the insured has special circumstances such as a disability, acute condition,
or life threatening illness or is past the 24th week of pregnancy and is receiving
treatment in accordance with the dictates of medical prudence. Special circumstances
mean a condition such that the treating physician or health care provider
reasonably believes that discontinuing care by the treating physician or provider
could cause harm to the patient. Special circumstances shall be identified
by the treating physician or health care provider who must request that the
insured be permitted to continue treatment under the physician or provider's
care and agree not to seek payment from the patient of any amounts for which
the insured would not be responsible if the physician or health care provider
were still a preferred provider. Contracts between an insurer and physicians
and health care providers shall include procedures for resolving disputes
regarding the necessity for continued treatment by the physician or health
care provider. This section does not extend the obligation of the insurer
to reimburse, at the preferred provider rate, the terminated physician or
health care provider or, if applicable, the insured for ongoing treatment
of an insured beyond 90 days from the effective date of the termination];
(8)
[
(4)
] if the insurer is issuing
other health insurance policies in the service area that do not provide for
the use of preferred providers, [
then
] the basic level of coverage
must be reasonably consistent with such other health insurance policies offered
by the insurer which do not provide for a different level of coverage for
use of a preferred provider;
(9)
any actions taken by an insurer engaged
in utilization review under a preferred provider benefit plan shall be taken
pursuant to Insurance Code Article 21.58A and Chapter 19, Subchapter R of
this title (relating to Utilization Review Agents);
[
(5)
an insurer shall provide
reimbursement for the following emergency care services at the preferred provider
level of benefits if the insured cannot reasonably reach a preferred provider
and until the insured can reasonably be expected to transfer to a preferred
provider:]
[
(A)
any medical screening examination or other
evaluation required by state or federal law to be provided in the emergency
department of a hospital which is necessary to determine whether a medical
emergency condition exists;]
[
(B)
necessary emergency care services including
the treatment and stabilization of an emergency medical condition; and]
[
(C)
services originating in a hospital emergency
department following treatment or stabilization of an emergency medical condition;]
[
(6)
physicians or health
care providers may refer an insured to providers other than preferred providers,
provided that the insured is advised that a different indemnity payment may
apply.]
(10)
if
[
If
] covered
services are not available through preferred providers
within the service
area
, [
the insurer shall pay for medically necessary covered services
by a
] non-preferred
providers
[
provider
]
shall be reimbursed at the same percentage level of reimbursement as
[
at the
] preferred
providers
[
provider level of
benefits
]. Nothing in this section requires reimbursement at a preferred
level of coverage solely because an insured resides out of the service area
and chooses to receive services from providers other than preferred providers
for the insured's own convenience;
(11)
a preferred provider benefit plan
may provide for a different level of coverage for use of a nonpreferred provider
if the referral is made by a preferred provider, provided that full disclosure
of the difference is included in the plan and the written description as required
by §3.3705(b) of this title (relating to Readability and Mandatory Disclosure
Requirements); and
[
(7)
all health insurance
policies, health benefit plan certificates, endorsements, amendments, applications
or riders shall be written in plain language, must be in a readable and understandable
format and must comply with Texas Department of Insurance rules found in Subchapter
G of this chapter (relating to Plain Language Requirements for Health Benefit
Policies). The insurer shall provide to a prospective group contract holder
and prospective insured upon request an accurate written description of the
terms and conditions of the policy to allow the prospective group contract
holder or prospective insured to make comparisons and informed decisions before
selecting among health care plans. The written description must be in a readable
and understandable format, by category, and must include a clear, complete
and accurate description of these items in the following order:]
[
(A)
a statement that the entity providing the coverage
is an insurance company, the name of the insurance company, and that the insurance
contract contains preferred provider benefits;]
[
(B)
a toll free number, unless exempted by statute
or rule, and address for the prospective group contract holder or prospective
insured to obtain additional information;]
[
(C)
an explanation of the distinction between preferred
and nonpreferred providers;]
[
(D)
all covered services and benefits, including
payment for services of a preferred provider and a nonpreferred provider,
and prescription drug coverage, both generic and name brand;]
[
(E)
emergency care services and benefits and information
on access to after-hours care;]
[
(F)
out of area services and benefits;]
[
(G)
an explanation of the insured's financial responsibility
for payment for premiums, deductibles, coinsurance or any other out-of-pocket
expenses for noncovered or nonpreferred services;]
[
(H)
any limitations and exclusions, including the
existence of any drug formulary limitations, and any limitations regarding
preexisting conditions;]
[
(I)
any prior authorizations, including preauthorization
review, concurrent review, post-service review, and postpayment review and
any penalties or reductions in benefits resulting from the failure to obtain
any required authorizations;]
[
(J)
provision for continuity of treatment in the
event of termination of a preferred provider's participation in the plan;]
[
(K)
summary of complaint resolution procedures,
if any, and a statement that the insurer is prohibited from retaliating against
the insured because the insured or other person has filed a complaint on behalf
of the insured and against a physician or provider who, on behalf of the insured,
has reasonably filed a complaint against the insurer or appealed a decision
of the insurer;]
[
(L)
a current list of preferred providers and complete
descriptions of the provider networks, including names and locations of physicians
and health care providers, and a disclosure of which preferred providers will
not accept new patients;]
[
(M)
service area;]
[
(8)
a copy of the written
description of the terms and conditions of the policy to be made available
to prospective group contract holders and prospective insureds as required
in paragraph (5) of this section shall be filed with the department. A current
list of preferred providers and the insurer's service area shall be filed
with the department annually by June 1;]
[
(9)
the health insurance
policy and all promotional, solicitation, and advertising material concerning
the health insurance policy shall clearly describe the distinction between
preferred and nonpreferred providers. Any illustration of preferred provider
benefits must be in close proximity to an equally prominent description of
basic benefits. A list of preferred providers shall be distributed to all
prospective insureds. Any change in the list of preferred providers shall
be provided to all insureds no less than annually to all insureds. Unless
exempted by statute or rule, the insurer shall provide to each insured a toll
free number to be maintained 40 hours per week during regular business hours
that the insured can call to obtain a current up-to-date list of preferred
providers;]
[
(10)
no insurer, or agent
or representative thereof, may cause or permit the use or distribution of
prospective insured information which is untrue or misleading;]
(12)
[
(11)
] both preferred provider
benefits and basic level benefits must be reasonably available to all insureds
within a designated service area
.
[
;
]
(b)
[
(12)
]
Payment
[
payment
] by the insurer shall be made for services of a nonpreferred
provider in the same prompt and efficient manner as to a preferred provider.
[
(13)
the insurer will make a good
faith effort to have a mix of for-profit, non-profit, and tax-supported institutional
providers under contract as preferred providers in the plan's service area
to afford all persons insured under such plan freedom of choice in the selection
of institutional providers at which they will receive care, unless such a
mix proves to be not feasible due to geographic, economic, or other operational
factors. In addition, special consideration shall be given to contracting
with teaching hospitals and hospitals providing indigent care or care for
uninsured individuals as a significant percentage of their overall patient
load.]
(c)
An insurer shall not engage in retaliatory
action against an insured, including cancellation of or refusal to renew a
policy, because the insured or a person acting on behalf of the insured has
filed a complaint against the insurer or a preferred provider or has appealed
a decision of the insurer.
(d)
In addition to the requirements for availability
of preferred providers set forth in Insurance Code Article 3.70-3C §8
(Preferred Provider Benefit Plans), any insurer offering a preferred provider
benefit plan shall make a good faith effort to have a mix of for-profit, non-profit,
and tax-supported institutional providers under contract as preferred providers
in the service area to afford all insureds under such plan freedom of choice
in the selection of institutional providers at which they will receive care,
unless such a mix proves to be not feasible due to geographic, economic, or
other operational factors. An insurer shall give special consideration to
contracting with teaching hospitals and hospitals that provide indigent care
or care for uninsured individuals as a significant percentage of their overall
patient load.
§3.3705.Readability and Mandatory Disclosure Requirements.
(a)
All health insurance policies, health benefit plan certificates,
endorsements, amendments, applications or riders shall be written in a readable
and understandable format that meets the requirements of §3.602 of this
title (relating to Plain Language Requirements for Health Benefit Policies).
(b)
The insurer shall, upon request, provide to a current or
prospective group contract holder or a current or prospective insured an accurate
written description of the terms and conditions of the policy which allows
the current or prospective group contract holder or current or prospective
insured to make comparisons and informed decisions before selecting among
health care plans. An insurer may utilize its handbook to satisfy this requirement
provided that the insurer complies with all requirements set forth in this
subsection including the level of disclosure required. The written description
must be in a readable and understandable format, by category, and must include
a clear, complete and accurate description of these items in the following
order:
(1)
a statement that the entity providing the coverage is an
insurance company, the name of the insurance company, and that the insurance
contract contains preferred provider benefits;
(2)
a toll free number, unless exempted by statute or
rule, and address to enable a current or prospective group contract holder
or a current or prospective insured to obtain additional information;
(3)
an explanation of the distinction between preferred
and nonpreferred providers;
(4)
all covered services and benefits, including payment
for services of a preferred provider and a nonpreferred provider, and prescription
drug coverage, both generic and name brand;
(5)
emergency care services and benefits and information
on access to after-hours care;
(6)
out-of-area services and benefits;
(7)
an explanation of the insured's financial responsibility
for payment for any premiums, deductibles, copayments, coinsurance or other
out-of-pocket expenses for noncovered or nonpreferred services;
(8)
any limitations and exclusions, including the existence
of any drug formulary limitations, and any limitations regarding preexisting
conditions;
(9)
any prior authorizations, including preauthorization
review, concurrent review, post-service review, and postpayment review and
any penalties or reductions in benefits resulting from the failure to obtain
any required authorizations;
(10)
provisions for continuity of treatment in the event
of termination of a preferred provider's participation in the plan;
(11)
a summary of complaint resolution procedures, if
any, and a statement that the insurer is prohibited from retaliating against
the insured because the insured or another person has filed a complaint on
behalf of the insured, or against a physician or provider who, on behalf of
the insured, has reasonably filed a complaint against the insurer or appealed
a decision of the insurer;
(12)
a current list of preferred providers and complete
descriptions of the provider networks, including names and locations of physicians
and health care providers, and a disclosure of which preferred providers will
not accept new patients; and
(13)
the service area.
(c)
A copy of the written description required in subsection
(b) of this section shall be filed with the department with the initial filing
of the preferred provider benefit plan and at any time a material change is
made in the information required in subsection (b).
(d)
The preferred provider benefit plan and all promotional,
solicitation and advertising material concerning the preferred provider benefit
plan shall clearly describe the distinction between preferred and nonpreferred
providers. Any illustration of preferred provider benefits must be in close
proximity to an equally prominent description of basic benefits.
(e)
No insurer, or agent or representative of an insurer, may
cause or permit the use or distribution of information which is untrue or
misleading.
(f)
A current list of preferred providers shall be distributed
to all prospective insureds, and to all insureds no less than annually, and
shall be filed with the department by June 1 of each year.
(g)
Unless exempted by statute or rule, the insurer shall provide
to each insured a toll free number to be maintained 40 hours per week during
regular business hours that the insured can call to obtain a current, up-to-date
list of preferred providers.
§3.3706.Designation as a Preferred Provider, Decision to Withhold Designation, Termination of a Preferred Provider, Review of Process.
(a)
Physicians, practitioners, institutional providers, and
health care providers other than physicians, practitioners, and institutional
providers, if such other health care providers are included by an insurer
as preferred providers, licensed to treat injuries or illnesses or to provide
services covered by the preferred provider benefit plan and that comply with
the terms and conditions established by the insurer for designation as preferred
providers, shall be eligible to apply for and be afforded a fair, reasonable
and equitable opportunity to become preferred providers.
(1)
An insurer initially sponsoring a preferred provider benefit
plan shall notify all physicians and practitioners in the service area covered
by the plan of its intent to offer the plan and of the opportunity to apply
to participate.
(2)
Subsequently, an insurer shall annually notify all
non-contracting physicians and providers in the service area covered by the
plan of the existence of the plan and the opportunity to apply to participate
in the plan.
(3)
An insurer shall, upon request, make available to
any physician or health care provider information concerning the application
process and qualification requirements for participation as a provider in
the plan.
(4)
All notifications given by an insurer pursuant to
this paragraph shall be made by publication or distributed in writing to each
physician and practitioner in the same manner.
(b)
Designation as a preferred provider shall not be unreasonably
withheld provided that, unless otherwise limited by the Insurance Code or
rule promulgated by the department, an insurer may reject an application from
a physician or health care provider on the basis that the preferred provider
benefit plan has sufficient qualified providers.
(1)
An insurer shall provide written notice of denial of any
initial application to a physician or health care provider which includes:
(A)
the specific reasons for the denial; and
(B)
in the case of physicians and practitioners, the right
to a review of the denial as set forth in paragraph (2) of this subsection.
(2)
An insurer shall provide a reasonable review
mechanism that incorporates, in an advisory role only, a review panel.
(A)
The review panel shall be composed of not less than three
individuals selected by the insurer from the list of physicians or practitioners
contracting with the insurer.
(B)
At least one of the three individuals on the review panel
shall be a physician or practitioner in the same or similar specialty as the
physician or practitioner requesting review unless there is no physician or
practitioner in the same or similar specialty contracting with the insured.
(C)
The list of physicians or practitioners required by subparagraph
(A) of this paragraph shall be provided to the insurer by the physicians or
practitioners who contract with the insurer in the applicable service area.
(D)
The recommendation of the panel shall be provided upon
request to the affected physician or practitioner.
(E)
In the event that the insurer makes a determination that
is contrary to the recommendation of the panel, a written explanation of the
insurer's determination shall be provided to the physician or practitioner
upon request.
(c)
Before terminating a contract with a preferred provider,
the insurer shall provide written notice of termination which includes:
(1)
the specific reasons for the termination; and
(2)
in the case of physicians or practitioners, notice
of the right to request a review prior to termination conducted in the same
manner as the review mechanism set forth in subsection (b)(2) of this section
which includes the timelines set forth in subsections (d) and (e) for requesting
review, except in cases involving:
(A)
imminent harm to patient health;
(B)
an action by a state medical or other physician licensing
board or other government agency which impairs the physician's or practitioner's
ability to practice medicine or to provide services; or
(C)
fraud or malfeasance.
(d)
To obtain a standard review of an insurer's decision to
terminate him or her, a physician or practitioner shall:
(1)
make a written request to the insurer for a review of that
decision within ten business days of receipt of notification of the insurer's
intent to terminate him or her; and
(2)
deliver to the insurer within 20 business days of
receipt of notification of the insurer's intent to terminate him or her, any
relevant documentation the physician or practitioner desires the panel and
insurer to consider in the review process.
(3)
The review process, including the recommendation of
the panel and the insurer's determination as required by subsection (b)(2)(E)
of this section, shall be completed and the results provided to the physician
or practitioner within 60 calendar days of the insurer's receipt of the request
for review.
(e)
To obtain an expedited review to obtain an expedited review
of an insurer's decision to terminate him or her, a physician or practitioner
shall:
(1)
make a written request to the insurer for a review of that
decision within five business days of receipt of notification of the insurer's
intent to terminate him or her; and
(2)
deliver to the insurer, within ten business days of
receipt of notification of the insurer's intent to terminate him or her, any
relevant documentation the physician or practitioner desires the panel to
consider in the review process.
(3)
The expedited review process, including the recommendation
of the panel and the insurer's determination as required by subsection (b)(2)(E)
of this section, shall be completed and the results provided to the physician
or practitioner within 30 calendar days of the insurer's receipt of the request
for review.
(f)
Confidentiality of information concerning the insured.
(1)
An insurer shall preserve the confidentiality of individual
medical records and personal information used in its termination review process.
Personal information shall include, at a minimum, name, address, telephone
number, social security number and financial information.
(2)
An insurer may not disclose or publish individual
medical records or other confidential information about an insured without
the prior written consent of the insured or unless otherwise required by law.
An insurer may provide confidential information to the advisory panel for
the sole purpose of performing its advisory review function. Information provided
to the advisory panel shall remain confidential.
(g)
Notice to insureds.
(1)
If a physician or practitioner is terminated for reasons
other than at the preferred provider's request, an insurer shall not notify
insureds of the termination until the effective date of the termination or
at such time as a review panel makes a formal recommendation regarding the
termination, whichever is later.
(2)
If a physician or provider voluntarily terminates
the physician's or provider's relationship with an insurer, the insurer shall
provide assistance to the physician or provider in assuring that the notice
requirements are met as required by §3.3703(a)(18) of this title (relating
to Contracting Requirements).
(3)
If a physician or practitioner is terminated for reasons
related to imminent harm, an insurer may notify insureds immediately.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of the Secretary of State on December
22, 1998.
TRD-9818550
Lynda H. Nesenholtz
General Counsel and Chief Clerk
Texas Department of Insurance
Earliest possible date of adoption: February 7, 1999
For further information, please call: (512) 463-6327