TITLE 28.INSURANCE

Part 1. TEXAS DEPARTMENT OF INSURANCE

Chapter 21. TRADE PRACTICES

Subchapter R. DIABETES

28 TAC §§21.2601, 21.2602, 21.2604, 21.2606

The Texas Department of Insurance proposes amendments to §§21.2601, 21.2602, 21.2604, and 21.2606 concerning minimum standards for benefits provided to enrollees with diabetes in health benefit plans and coverage under health benefit plans for equipment and supplies and self-management training associated with the treatment of diabetes. The amendments are necessary to implement legislation enacted by the 76th Legislature in Senate Bill 982, amending Article 21.53G, Coverage for Supplies and Services Associated with Treatment of Diabetes. The amendments are also necessary to clarify applicability of the sections to health benefits provided by a risk pool created under Chapter 172, Local Government Code, consistent with Insurance Code Article 21.53D.

The proposed amendments to §21.2601 remove unnecessary language and add a definition for nutrition counseling. The proposed amendments to §21.2604 establish that, consistent with Article 21.53D, Insurance Code, the provisions relating to diabetes equipment and supplies and diabetes self-management training apply to health benefits provided by a risk pool created under Chapter 172, Local Government Code, and delete references to §21.2607, which is being simultaneously proposed for repeal elsewhere in this issue of the Texas Register. The proposed amendments to §21.2606 identify the components of diabetes self-management training and those individuals or entities who may provide diabetes self-management training and the required training for those individuals. The proposal also includes grammatical and other changes to conform language to Texas Register style guidelines.

Kim Stokes, Senior Associate Commissioner, Life, Health and Licensing, has determined that for each year of the first five years the proposed sections will be in effect, there will be no fiscal impact to state and local governments as a result of the enforcement or administration of the rule. There will be no measurable effect on local employment or the local economy as a result of the proposal.

Ms. Stokes has determined that for each year of the first five years the proposed amendments are in effect, the public benefits anticipated as a result of the proposed amendments will be the identification of components of diabetes self-management training and clarification of the applicability of certain provisions to health benefits provided by a risk pool. Ms. Stokes also has determined that any economic costs to entities required to comply with these amendments, as well as any costs to a covered entity qualifying as a small or micro business under Government Code §2006.001, for each year of the first five years the proposed amendments will be in effect, are the result of the legislative enactment of SB 982, and not as a result of the adoption, enforcement, or administration of the proposed amendments. The total cost to a covered entity would not vary between the smallest and largest businesses. Therefore, it is the department’s position that the adoption of these proposed amendments will have no adverse economic effect on small businesses or micro-businesses. Regardless of the fiscal effect, the department does not believe it is either legal or feasible to exempt small businesses or micro-businesses from the requirements of these proposed amendments. To do so would allow differentiation in the provision of diabetes self-management training or coverage for diabetes self-management training between small business health carriers compared to large health carriers.

To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on February 10, 2003 to Gene C. Jarmon, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comment must be simultaneously submitted to Margaret Lazaretti, Director of Project Development, Mail Code 107-2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. A request for a public hearing should be submitted separately to the Office of the Chief Clerk.

The amendments are proposed under the Insurance Code Article 21.53G, 21.53D and §36.001. Article 21.53G determines and defines the component or components of self-management training and provides that the commissioner shall adopt rules as necessary for the implementation of the article. Article 21.53D §3 provides that the commissioner shall by rule adopt minimum standards for benefits to enrollees with diabetes and that each health care benefit plan shall provide benefits for the care required by the minimum standards. Section 36.001 provides that the Commissioner of Insurance may adopt rules to execute the duties and functions of the Texas Department of Insurance as authorized by statute.

The following articles are affected by this proposal: Insurance Code Article 21.53G and 21.53D

§21.2601.Definitions.

The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise:

(1) Basic benefit--Health care service or coverage, which is included in the evidence of coverage, policy, or certificate, without additional premium.

(2) Caretaker--A family member or significant other responsible for ensuring that an insured not able to manage his or her illness (due to age or infirmity) is properly managed, including overseeing diet, administration of medications, and use of equipment and supplies.

(3) Diabetes--Diabetes mellitus. A chronic disorder of glucose metabolism that can be characterized by an elevated blood glucose level. The terms diabetes and diabetes mellitus are synonymous.

(4) Diabetes equipment--The term "diabetes equipment" includes items defined in Insurance Code Article 21.53 G §§1(1) and [ § ]5, and §21.2605 of this title (relating to Diabetes Equipment and Supplies).

(5) Diabetes supplies--The term "diabetes supplies" includes items defined in Insurance Code Article 21.53 G §§1(2) and 5, and §21.2605 of this title [ (relating to Diabetes Equipment and Supplies) ].

(6) Diabetes self-management training--Instruction enabling an insured and/or his or her caretaker to understand the care and management of diabetes, including nutritional counseling and proper use of diabetes equipment and supplies.

(7) Health benefit plan--A health benefit plan, for purposes of this subchapter, means:

(A) a plan that provides benefits for medical or surgical expenses incurred as a result of a health condition, accident, or sickness, including:

(i) an individual, group, blanket, or franchise insurance policy or insurance agreement, a group hospital service contract, or an individual or group evidence of coverage that is offered by:

(I) an insurance company;

(II) a group hospital service corporation operating under Chapter 20 of the Texas Insurance Code;

(III) a fraternal benefit society operating under Chapter 10 of the Texas Insurance Code;

(IV) a stipulated premium insurance company operating under Chapter 22 of the Insurance Code;

(V) a reciprocal exchange operating under Chapter 19 of the Texas Insurance Code; or

(VI) a health maintenance organization (HMO) operating under the Texas Health Maintenance Organization Act (Chapter 20A, Texas Insurance Code);

(ii) to the extent permitted by the Employee Retirement Income Security Act of 1974 (29 USC §1002), a health benefit plan that is offered by a multiple employer welfare arrangement as defined by §3, Employee Retirement Income Security Act of 1974 (29 USC §1002) that holds a certificate of authority under Insurance Code Article 3.95-2; or

(iii) notwithstanding §172.014, Local Government Code, or any other law, health and accident coverage provided by a risk pool created under Chapter 172, Local Government Code.

(B) A plan offered by an approved nonprofit health corporation that is certified under §5.01(a), Medical Practice Act, and that holds a certificate of authority issued by the commissioner under Insurance Code Article 21.52F.

(C) A health benefit plan is not:

(i) a plan that provides coverage:

(I) only for a specified disease or other limited benefit;

(II) only for accidental death or dismemberment;

(III) for wages or payments in lieu of wages for a period during which an employee is absent from work because of sickness or injury;

(IV) as a supplement to liability insurance;

(V) for credit insurance;

(VI) dental or vision care only; or

(VII) hospital confinement indemnity coverage only.

(ii) a small employer plan written under Chapter 26 of the Insurance Code;

(iii) a Medicare supplemental policy as defined by §1882(g)(1), Social Security Act (42 USC §1395 ss);

(iv) workers' compensation insurance coverage;

(v) medical payment insurance issued as part of a motor vehicle insurance policy; or

(vi) a long-term care policy, including a nursing home fixed indemnity policy, unless the commissioner determines that the policy provides benefit coverage so comprehensive that the policy is a health benefit plan as described by subparagraph (A) of this paragraph.

(8) Insured--A person enrolled in a health benefit plan who has been diagnosed with:

(A) insulin dependent or noninsulin dependent diabetes; or

(B) elevated blood glucose levels induced by pregnancy or another medical condition associated with elevated glucose levels.

(9) Nutrition counseling--As defined in §701.002 of the Texas Occupations Code.

(10) [ (9) ] Physician--A Doctor of Medicine or a Doctor of Osteopathy licensed by the Texas State Board of Medical Examiners.

(11) [ (10) ] Practitioner--An Advanced Practice Nurse, Doctor of Dentistry, Physician Assistant, Doctor of Podiatry, or other licensed person with prescriptive authority.

§21.2602.Required Benefits for Persons with Diabetes.

(a) Notwithstanding §172.014, Local Government Code, or any other law, health plans provided by a risk pool created under Chapter 172, Local Government Code, delivered, issued for delivery, or renewed on or after January 1, 1998, that provide benefits for the treatment of diabetes and associated conditions must provide coverage to an insured for diabetes equipment, diabetes supplies, and diabetes self-management training programs, in accordance with §21.2603 of this title (relating to Out of Pocket Expenses), §21.2605 of this title (relating to Diabetes Equipment and Supplies) and §21.2606 of this title (relating to Diabetes Self-Management Training).

(b) Health benefit plans (other than reciprocal exchanges operating under Chapter 19 of the Texas Insurance Code) delivered, issued for delivery, or renewed on or after January 1, 1999, must provide coverage to each insured in accordance with §21.2603 of this title and §21.2604 of this title (relating to Minimum Standards for Benefits for Persons with Diabetes).

(c) Health benefits plans delivered, issued for delivery, or renewed on or after January 1, 1998, by an entity other than an HMO, which provide coverage limited to hospitalization expenses, shall provide coverage to each insured for diabetes equipment, diabetes supplies, and diabetes self-management training programs, in accordance with §§21.2603, 21.2605 [ §21.2603 of this title, §21.2605 of this title ], and §21.2606 of this title, during hospitalization of the insured.

(d) A determination of medical necessity may be applied to benefits required under this subchapter provided it complies with all applicable laws and regulations.

§21.2604.Minimum Standards for Benefits for Persons with Diabetes, Requirement for Periodic Assessment of Physician and Organizational Compliance.

(a) Health benefit plans provided by HMOs shall provide coverage for the services in paragraphs (1) through (7) of this subsection and shall contract with providers that agree to comply with the minimum practice standards outlined in subsection (b) of this section. Services to be covered include:

(1) office visits and consultations with physicians and practitioners for monitoring and treatment of diabetes, including office visits and consultations with appropriate specialists;

(2) immunizations required by Insurance Code Article 21.53F, Coverage for Childhood Immunizations;

(3) immunizations for influenza and pneumococcus;

(4) inpatient services, and physician and practitioner services when the insured is confined to:

(A) a hospital;

(B) a rehabilitation facility; or

(C) a skilled nursing facility;

(5) inpatient and outpatient laboratory and diagnostic imaging services;

(6) diabetes equipment and supplies in accordance with §21.2605 of this title (relating to Diabetes Equipment and Supplies), [ except ] notwithstanding §172.014, Local Government Code, or any other law, this subsection applies [ does not apply ] to health benefits provided by a risk pool created under Chapter 172, Local Government Code; and

(7) diabetes self-management training, in accordance with subsection (b)(1)(iii) [ (b)(1)(ii) ] of this section[ , §21.2606 of this title (relating to Diabetes Self-Management Training) or §21.2607 of this title (relating to Accessibility and Availability of Diabetes Self-Management Training Prior to January 1, 2002), except ], notwithstanding §172.014, Local Government Code, or any other law, this subsection applies [ does not apply ] to health benefits provided by a risk pool created under Chapter 172, Local Government Code;

(b) HMOs shall contract with providers who, at a minimum, provide care that complies with subsection (a) of this section that includes:

(1) for all insureds:

(A) at initial visit by the insured:

(i) a complete history and physical including an assessment of immunization status;

(ii) development of a management plan addressing all of the following that are applicable to the insured:

(I) nutrition and weight evaluation;

(II) medications;

(III) an exercise regimen;

(IV) glucose and lipid control;

(V) high risk behaviors;

(VI) frequency of hypoglycemia and hyperglycemia;

(VII) compliance with applicable aspects of self care;

(VIII) assessment of complications;

(IX) follow up on any referrals;

(X) psychological and psychosocial adjustment;

(XI) general knowledge of diabetes; and

(XII) self-management skills;

(iii) diabetes self-management training given or referred by the physician or practitioner as required by §21.2606 of this title[ and §21.2607 of this title) ];

(iv) referral for a dilated funduscopic eye exam to be performed by an ophthalmologist or therapeutic optometrist for an insured with Type 2 Diabetes.

(B) at every visit the following:

(i) weight and blood pressure taken,

(ii) foot exam performed without shoes or socks, and

(iii) dental inspection.

(C) every six months the following:

(i) review of the management plan, and

(ii) glycosylated hemoglobin test.

(D) annually the following:

(i) lipid profile,

(ii) microalbuminuria;

(iii) influenza immunization;

(iv) referral for a dilated funduscopic eye exam performed by an ophthalmologist or therapeutic optometrist; and

(v) for insureds under 18 [ eighteen ] years of age, a referral for a retinal camera examination to be performed by an ophthalmologist or therapeutic optometrist.

(2) For treatment of an insured 65 [ sixty-five ] years of age and over or an insured with complications affecting two or more body systems:

(A) minimum practice standards as set forth in paragraph (1) of this subsection; and

(B) specific inquiries into and consideration of treatment goals for comorbidity and polypharmacy.

(3) For pregnant insureds with pre-existing or gestational diabetes:

(A) minimum practice standards as set forth in paragraph (1) of this subsection; and

(B) enhanced fetal monitoring based on the standards promulgated by the American College of Gynecologists and Obstetricians.

(4) For insureds with Type 1 Diabetes:

(A) minimum practice standards as set forth in paragraph (1) of this subsection;

(B) an initial diagnosis, consideration of hospitalization due to the insured's:

(i) age;

(ii) physical condition;

(iii) psychosocial circumstances; or

(iv) lack of access to outpatient diabetes self-management training as required in §21.2606 of this title [ or §21.2607 of this title ]; and

(C) on-going management which includes quarterly office visits at which evaluation includes:

(i) weight;

(ii) blood pressure;

(iii) ophthalmologic exam;

(iv) thyroid palpation;

(v) cardiac exam;

(vi) examination of pulses;

(vii) foot exam;

(viii) skin exam;

(ix) neurological exam;

(x) dental inspection;

(xi) results of home glucose self monitoring;

(xii) frequency and severity of hypoglycemia or hyperglycemia;

(xiii) medical nutrition plan;

(xiv) exercise regimen;

(xv) adherence problems;

(xvi) psychosocial adjustment;

(xvii) reevaluation of short and long term self-management goals;

(xviii) anticipatory guidance related to issues of Type 1 Diabetes;

(xix) glycosylated hemoglobin;

(xx) counseling for high risk behaviors; and

(xxi) for insureds under eighteen years of age, growth assessment.

(c) Health plans provided by HMOs shall periodically assess physician and organizational compliance with the minimum practice standards contained in subsection (b) of this section.

(d) Health benefit plans provided by entities other than HMOs shall provide coverage at a minimum for:

(1) office visits and consultations with physicians and practitioners for monitoring and treatment of diabetes, including office visits and consultations with appropriate specialists;

(2) immunizations required by Insurance Code Article 21.53F, Coverage for Childhood Immunizations;

(3) immunizations for influenza and pneumococcus;

(4) inpatient services, physician, and practitioner services when an insured is confined to:

(A) a hospital;

(B) a rehabilitation facility; or

(C) a skilled nursing facility;

(5) inpatient and outpatient laboratory and diagnostic imaging services;

(6) diabetes equipment and supplies in accordance with §21.2605 of this title, [ except ] notwithstanding §172.014, Local Government Code, or any other law, this subsection applies [ does not apply ] to health benefits provided by a risk pool created under Chapter 172, Local Government Code; and

(7) diabetes self-management training in accordance with §21.2606 of this title [ or §21.2607 of this title, except ], notwithstanding §172.014, Local Government Code, or any other law, this subsection applies [ does not apply ] to health benefits provided by a risk pool created under Chapter 172, Local Government Code.

§21.2606.Diabetes Self-Management Training.

(a) A health benefit plan shall provide diabetes self-management training or coverage for diabetes self-management training for which a physician or practitioner has written an order , including a written order of a practitioner practicing under protocols jointly developed with a physician, to each insured or the caretaker of the insured in accordance with the standards contained in Insurance Code Article 21.53G, Sec. 4(b) and (c) [ from: ]

[(1) a diabetes self-management training program recognized by the American Diabetes Association;]

[(2) a multidisciplinary team coordinated by a Certified Diabetes Educator (CDE), who is certified by the National Certification Board for Diabetes Educators. The team shall consist of at least a dietitian and a nurse educator; other team members may include a pharmacist and a social worker. Other than a social worker, all team members must have recent didactic and experiential preparation in diabetes clinical and educational issues;]

[(3) a Certified Diabetes Educator (CDE); or]

[(4) a licensed health care professional, including a physician, a physician assistant, a registered nurse, a licensed or registered dietician, or a pharmacist, who has been determined by his or her licensing board to have recent didactic and experiential preparation in diabetes clinical and educational issues,]

(b) A person may not provide a component of diabetes self-management training under subsection (a) of this section unless the subject matter of the component is within the scope of the person’s practice and the person meets the education requirements as determined by the person’s licensing agency in consultation with the commissioner of health. [ All individuals providing self-management training pursuant to subsection (a) of this section must be licensed, registered, or certified in Texas to provide appropriate health care services. ]

(c) Self-management training shall include the development of an individualized management plan that is created for and in collaboration with the insured and that meets the requirements of the minimum standards for benefits in accordance with §21.2604 of this title (relating to Minimum Standards for Benefits for Persons with Diabetes).

(d) Nutrition [ Medical nutritional ] counseling and instructions on the proper use of diabetes equipment and supplies shall be provided or covered as part of the training.

(e) Diabetes self-management training shall be provided, or coverage for diabetes self-management training shall be provided to an insured or a caretaker, upon the following occurrences relating to an insured, provided that any training involving the administration of medications must comply with the applicable delegation rules from the appropriate licensing agency:

(1) the initial diagnosis of diabetes;

(2) the written order of a physician or practitioner indicating that a significant change in the symptoms or condition of the insured requires changes in the insured's self-management regime;

(3) the written order of a physician or practitioner that periodic or episodic continuing education is warranted by the development of new techniques and treatment for diabetes.

(f) An HMO shall provide oversight of its diabetes self-management training program on an ongoing basis to ensure compliance with this section.

(g) Health benefit plans provided by entities other than HMOs shall disclose in the plan how to access providers or benefits described in subsection (a) of this section [ and §21.2607 of this title (relating to Accessibility and Availability of Diabetes Self-Management Training Prior to January 1, 2002) ].

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 30, 2002.

TRD-200208568

Gene C. Jarmon

Acting General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: February 9, 2003

For further information, please call: (512) 463-6327


28 TAC §21.2607

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas Department of Insurance or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The Texas Department of Insurance proposes the repeal of §21.2607 concerning minimum standards for benefits provided to enrollees with diabetes in health benefit plans and coverage under health benefit plans for equipment and supplies and self-management training associated with the treatment of diabetes. The repeal is necessary to remove language for which the statutory authority has expired. Contemporaneously with this proposed repeal, proposed amendments to §§21.2601-21.2606 are published elsewhere in this issue of the Texas Register .

Kim Stokes, Senior Associate Commissioner, Life, Health and Licensing, has determined that for each year of the first five years the proposed repeal is in effect, there will be no fiscal impact to state and local governments as a result of the enforcement or administration of the rule. There will be no measurable effect on local employment or the local economy as a result of the proposal.

Ms. Stokes has determined that for each year of the first five years the proposed repeal is in effect, the public benefits anticipated as a result of the proposed repeal will be the removal language for which the statutory authority has expired. Regardless of the fiscal effect, the department does not believe it is either legal or feasible to exempt small businesses or micro-businesses from the requirements of the proposed repeal. To do so would allow differentiation in the provision of diabetes self-management training or coverage for diabetes self-management training between small business health carriers compared to large health carriers.

To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on February 10, 2003 to Gene C. Jarmon, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comment must be simultaneously submitted to Margaret Lazaretti, Director of Project Development, Mail Code 107-2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. A request for a public hearing should be submitted separately to the Office of the Chief Clerk.

The repeal is proposed under the Insurance Code Articles 21.53D and §36.001. Article 21.53D §3 provides that the commissioner shall by rule adopt minimum standards for benefits to enrollees with diabetes. Section 36.001 provides that the Commissioner of Insurance may adopt rules to execute the duties and functions of the Texas Department of Insurance as authorized by statute.

The following articles are affected by this proposal: Insurance Code Article 21.53D

§21.2607.Accessibility and Availability of Diabetes Self-Management Training Prior to January 1, 2002.

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 30, 2002.

TRD-200208571

Gene C. Jarmon

Acting General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: February 9, 2003

For further information, please call: (512) 463-6327


Chapter 22. PRIVACY

Subchapter B. INSURANCE CONSUMER HEALTH INFORMATION PRIVACY

28 TAC §§22.51, 22.58, 22.59

The Texas Department of Insurance proposes an amendment to §22.51 and new §22.58 and §22.59, concerning privacy of nonpublic personal health information provided by consumers to insurers and other covered entities regulated by the department. This proposal is necessary to complete implementation of Senate Bill (SB) 11, 77th Texas Legislature. SB 11 added Chapter 28B to the Insurance Code (Article 28B.01 et seq.), which establishes standards for entities regulated by the department with regard to protected consumer health information. SB 11 also added Subtitle I to Title 2 of the Health & Safety Code (Section 181.001 et seq.), which requires certain persons, including covered entities subject to regulation by the department, to comply with provisions addressing reidentification of persons and marketing using protected health information. SB 11 authorizes the Commissioner to adopt rules necessary to implement protected health information privacy requirements as they relate to entities regulated by the department.

The subchapter as originally adopted set forth the requirements that covered entities must meet in structuring their consumer health information practices to comply with SB 11. Specifically, the current rules provide notice requirements, as well as other procedures that covered entities must follow with regard to nonpublic personal health information collected about a consumer. The proposed amendment to §22.51 expands the scope of the subchapter to include proposed new §22.58 and §22.59. Proposed §22.58 outlines requirements for marketing using protected health information, including requirements for authorization of the individual who is the subject of the protected health information. Proposed §22.59 prohibits reidentification of or any attempt to reidentify a person who is the subject of any protected health information.

Kim Stokes, Senior Associate Commissioner for Life, Health, & Licensing, has determined that for each year of the first five years the proposed sections will be in effect, there will be no fiscal impact to state and local governments as a result of the enforcement or administration of the rule. There will be no measurable effect on 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 new sections are in effect, the public benefit anticipated as a result of the proposed sections will be enhanced protection of privacy of consumer health information. Ms. Stokes has determined that any economic cost to persons required to comply with the new sections, as well as any costs to a covered entity qualifying as a small business under Government Code 2006.001, for each year of the first five years the proposed new sections will be in effect are the result of the legislative enactment of the Insurance Code Chapter 28B and Health & Safety Code §181.151 and §181.152, and not as a result of the adoption, enforcement, or administration of the proposed new sections. The total cost to a covered entity is not dependent upon the size of the entity, but rather is dependent upon the entity’s number of consumers. Therefore, it is the department’s position that the adoption of these proposed new sections will have no adverse economic effect on small businesses or micro-businesses. Regardless of the fiscal effect, the department does not believe it legal or feasible to waive the requirements of these rules for small businesses or micro-businesses. To do so would allow differentiation of protection between consumers of small business covered entities compared to those protections provided to the consumers of large covered entities. In an effort to minimize costs, however, covered entities may deliver required notices along with other correspondence rather than in a separate mailing.

To be considered, comments on the proposal must be submitted in writing no later than 5:00 p.m., Central Daylight Time, on February 10, 2003 to Gene C. Jarmon, General Counsel, Mail Code 113-2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comment must be simultaneously submitted to Bill Bingham, Deputy for Regulatory Matters, Mail Code 107-2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. A request for a public hearing should be submitted separately to the Office of the Chief Clerk.

The new sections are proposed under the Insurance Code Article 28B.08 and §36.001 and the Health & Safety Code, §181.004. Insurance Code Article 28B.08 provides that the Commissioner may adopt rules as necessary to implement the chapter. Insurance Code §36.001 provides that the Commissioner of Insurance may adopt rules to execute the duties and functions of the Texas Department of Insurance only as authorized by statute. Health & Safety Code §181.004 authorizes a state agency that licenses or regulates a covered entity subject to Chapter 181 to adopt rules as necessary to carry out the purposes of the chapter.

The following articles of the Insurance Code and sections of Chapter 181 of the Health & Safety Code are affected by this proposal: Insurance Code Art. 28B.01 et seq., Health & Safety Code, §181.151 and §181.152.

§22.51.Purpose and Scope.

(a) Purpose. This subchapter governs the treatment by all covered entities of a consumer’s nonpublic personal health information. This subchapter:

(1) - (2) (No change.)

(3) prohibits a covered entity from reidentifying or attempting to reidentify a consumer who is the subject of any protected health information without obtaining the consumer's consent or authorization; and

(4) sets forth requirements for written marketing communication using protected health information.

(b) (No change.)

§22.58. Disclosure of Protected Health Information for Marketing Purposes; Requirements for Marketing By or On Behalf of a Covered Entity.

(a) A covered entity may not disclose, use, or sell protected health information, including prescription information or prescription patterns, for marketing purposes without an authorization from the person who is the subject of the protected health information which complies with this subchapter.

(b) A covered entity may not coerce or encourage the coercion of a person to consent to or authorize the disclosure, use, or sale of protected health information for marketing purposes.

(c) Any written marketing communications sent by or on behalf of a covered entity must:

(1) be sent in an envelope showing only the address of the sender and the name and address of the recipient;

(2) state the name and toll-free number of the sender and, if different, the covered entity on whose behalf the communication was sent; and

(3) explain the recipient's right to have the recipient's name removed from the sender's mailing list.

(d) A person who receives a request under subsection (c)(3) of this section to remove a recipient's name from a mailing list shall remove the recipient's name not later than the fifth day after the person receives the request.

§22.59. Reidentified Information.

A covered entity may not reidentify or attempt to reidentify a person who is the subject of any protected health information without obtaining from that person an authorization that complies with this subchapter, if required under Chapter 181, Health & Safety Code; Article 28B, Insurance Code; or other state or federal law.

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 30, 2002.

TRD-200208565

Gene C. Jarmon

Acting General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: February 9, 2003

For further information, please call: (512) 463-6327