INSURANCE CODE - NOT CODIFIED
CHAPTER 20A. HEALTH MAINTENANCE ORGANIZATION ACT
Art. 20A.01A. Citation of This Law
Article repealed effective April 1, 2005.
This Act may be cited as Chapter 20A, Insurance Code, and the
sections contained in this Act may be cited as articles of Chapter
20A, Insurance Code.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 13, eff. June 1, 2003.
Art. 20A.01B. Applicability of Definitions
Article repealed effective April 1, 2005.
In this Act, terms defined by Section 843.002, Insurance Code, have
the meanings assigned by that section.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 13, eff. June 1, 2003.
Art. 20A.09. Evidence of Coverage and Charges
Article repealed effective April 1, 2005.
Text of article as amended by Acts 1997, 75th Leg., ch. 837, Sec.
4.01, Acts 1997, 75th Leg., ch. 905, Sec. 1, Acts 1997, 75th Leg.,
ch. 1023, Sec. 4
(a) Every enrollee residing in this state is entitled to evidence of
coverage under a health care plan. If the enrollee obtains coverage
under a health care plan through an insurance policy or a contract
issued by a group hospital service corporation, whether by option
or otherwise, the insurer or the group hospital service corporation
shall issue the evidence of coverage. Otherwise, the health
maintenance organization shall issue the evidence of coverage. By
agreement between the insurer, group hospital service corporation,
or health maintenance organization and the subscriber, or the
person entitled to receive the policy, contract, or evidence of
coverage, the evidence of coverage required by this section may be
delivered by electronic transfer.
(b) No evidence of coverage, or amendment thereto, shall be issued
or delivered to any person in this state until a copy of the form of
evidence of coverage, or amendment thereto, has been filed with and
approved by the commissioner.
(c) An evidence of coverage may not contain provisions or
statements which are unjust, unfair, inequitable, misleading,
deceptive, which encourage misrepresentation, or which are untrue,
misleading, or deceptive as defined in Section 14 of this Act.
(d) Each evidence of coverage must contain provisions regarding the
requirements adopted under Subsections (e)-(i) of this section.
(e) Each evidence or coverage must contain a clear and complete
statement, if a contract, or a reasonably complete facsimile, if a
certificate, of:
(1) the medical, health care services, limited health care
services, or single health care service and the issuance of other
benefits, if any, to which the enrollee is entitled under the health
care plan, limited health care service plan, or single health care
service plan;
(2) any limitation on the services, kinds of services, benefits, or
kinds of benefits to be provided, including any deductible or
co-payment feature;
(3) where and in what manner information is available as to how
services may be obtained; and
(4) a clear and understandable description of the health
maintenance organization's methods for resolving enrollee
complaints, including the enrollee's right to appeal denials of an
adverse determination, as that term is defined by Section 12A of
this Act, to an independent review organization and the procedures
for making an appeal to an independent review organization. Any
subsequent changes may be evidenced in a separate document issued
to the enrollee.
(f) If medically necessary covered services are not available
through network physicians or providers, the health maintenance
organization, on the request of a network physician or provider,
within a reasonable period, shall allow referral to a non-network
physician or provider and shall fully reimburse the non-network
physician or provider at the usual and customary or an agreed rate.
The evidence of coverage must provide for a review by a specialist
of the same specialty or a similar specialty as the type of
physician or provider to whom a referral is requested before the
health maintenance organization may deny a referral.
(g) An enrollee with a chronic, disabling, or life-threatening
illness may apply to the health maintenance organization's medical
director to use a nonprimary care physician specialist as the
enrollee's primary care physician. An application made by an
enrollee under this subsection must include information specified
by the health maintenance organization, including certification of
the medical need, and must be signed by the enrollee and the
nonprimary care physician specialist interested in serving as the
enrollee's primary care physician. To be eligible to serve as the
enrollee's primary care physician, the specialist must:
(1) meet the health maintenance organization's requirements for
primary care physician participation; and
(2) be willing to accept the coordination of all of the enrollee's
health care needs.
(h) If the request for special consideration described by
Subsection (g) is denied, an enrollee may appeal the decision
through the health maintenance organization's established
complaint and appeals process.
(i) The effective date of the designation of a nonprimary care
physician specialist as an enrollee's primary care physician, as
provided by Subsection (g) of this section, may not be applied
retroactively. The health maintenance organization may not reduce
the amount of compensation owed to the original primary care
physician for services provided before the date of the new
designation.
(j) Any form of the evidence of coverage or group contract to be
used in this state, and any amendments thereto, are subject to the
filing and approval requirements of Subsection (l) of this section,
unless it is subject to the jurisdiction of the commissioner under
the laws governing health insurance or group hospital service
corporations, in which event the filing and approval provisions of
such law shall apply. To the extent, however, that such provisions
do not apply to the requirements of Subsections (c)-(i) of this
section, the requirements of those subsections apply.
Text of subsec. (k) as added by Acts 1997, 75th Leg., ch. 837, Sec.
4.01
(k) Continuation of Coverage and Conversion. (A) A health
maintenance organization shall provide a group continuation
privilege as required by this subsection. Any enrollee whose
coverage under the group contract has been terminated for any
reason except involuntary termination for cause, and who has been
continuously insured under the group contract and under any group
contract providing similar services and benefits which it replaces
for at least three consecutive months immediately prior to
termination shall be entitled to such privilege as outlined below.
Involuntary termination for cause does not include termination for
any health-related cause. Health maintenance organization
contracts subject to this section shall provide continuation of
group coverage for enrollees subject to the eligibility provisions
below:
(1) Continuation of group coverage must be requested in writing
within 31 days following the later of: (aa) the date the group
coverage would otherwise terminate; or (bb) the date the enrollee
is given notice of the right of continuation by either the employer
or the group contract holder.
(2) An enrollee electing continuation must pay to the group
contract holder or employer on a monthly basis, in advance, the
amount of contribution required by the contract holder or employer,
plus two percent of the group rate for the coverage being continued
under the group contract, on the due date of each payment.
(3) The enrollee's written election of continuation, together with
the first contribution required to establish contributions on a
monthly basis, in advance, must be given to the contract holder or
employer within 31 days following the later of: (aa) the date the
group coverage would otherwise terminate; or (bb) the date the
enrollee is given notice of the right of continuation by either the
employer or the group contract holder.
(4) Continuation may not terminate until the earliest of: (aa) six
months after the date the election is made; (bb) the date on which
failure to make timely payments would terminate coverage; (cc) the
date on which the covered person is covered for similar services and
benefits by another hospital, surgical, medical, or major medical
expense insurance policy or hospital or medical service subscriber
contract or medical practice or other prepayment plan or any other
plan or program; or (dd) the date on which the group coverage
terminates in its entirety.
(5) Not less than 30 days before the end of the six months after the
date the enrollee elects continuation of the contract, the health
maintenance organization shall notify the enrollee that he/she may
be eligible for coverage under the Texas Health Insurance Risk
Pool, as provided under Article 3.77, Insurance Code, and the
health maintenance organization shall provide the address for
applying to such pool to the enrollee.
(B) A health maintenance organization may offer to each enrollee a
conversion contract. Such conversion contract shall be issued
without evidence of insurability if written application for and
payment of the first premium is made not later than the 31st day
after the date of termination. The conversion contract shall meet
the minimum standards for services and benefits for conversion
contracts. The commissioner shall issue rules and regulations to
establish minimum standards for services and benefits under
contracts issued pursuant to this subdivision.
(C) The premium for a conversion contract issued under this Act
shall be determined in accordance with the health maintenance
organization's premium rates for coverage that were provided under
the group contract or plan. The premium may be based on geographic
location of each person to be covered and the type of conversion
contract and coverage provided. The premium for the same coverage
under a conversion contract may not exceed 200 percent of the
premium determined in accordance with this subdivision. The
premium must be based on the type of conversion contract and the
coverage provided by contract.
Text of subsec. (k) as redesignated from subsec. (b) by Acts 1997,
75th Leg., ch. 905, Sec. 1
(k) The formula or method for calculating the schedule of charges
for enrollee coverage for medical services or health care services
must be filed with the commissioner before it is used in conjunction
with any health care plan. The formula or method must be
established in accordance with actuarial principles for the various
categories of enrollees. The charges resulting from the
application of the formula or method may not be altered for an
individual enrollee based on the status of that enrollee's health.
The formula or method must produce charges that are not excessive,
inadequate, or unfairly discriminatory, and benefits must be
reasonable with respect to the rates produced by the formula or
method. A statement by a qualified actuary that certifies the
appropriateness of the formula or method must accompany the filing
together with supporting information considered adequate by the
commissioner.
Text of subsec. (l) as added by Acts 1997, 75th Leg., ch. 837, Sec.
4.01
(l) Individual Health Care Plan. A health maintenance organization
may provide an individual health care plan as required by this
subsection.
(A) For purposes of this subsection, an "individual health care
plan" means:
(1) a health care plan providing health care services for
individuals and their dependents;
(2) a health care plan in which an enrollee pays the premium and is
not being covered under the contract pursuant to continuation of
services and benefits provisions applicable under federal or state
law; and
(3) a plan in which the evidence of coverage meets the requirements
of Section 2(a) of this Act.
(B) A health maintenance organization may limit its enrollees to
those who live, reside, or work within the service area for such
network plan.
(C) Renewability of Coverage. An individual health care plan or a
conversion contract providing health care services shall be
renewable with respect to an enrollee at the option of the enrollee,
and may be nonrenewed based only on one or more of the following
reasons:
(1) failure to pay premiums or contributions in accordance with the
terms of the plan or the issuer has not received timely premium
payments;
(2) fraud or intentional misrepresentation;
(3) the health maintenance organization is ceasing to offer
coverage in the individual market in accordance with rules
established by the commissioner;
(4) enrollee no longer resides, lives, or works in the area in which
the health maintenance organization is authorized to provide
coverage, but only if such coverage is terminated under this
paragraph uniformly without regard to any health-status-related
factor of covered enrollees; or
(5) in accordance with applicable federal law and regulations.
(D) The commissioner may adopt rules necessary to implement this
subsection and to meet the minimum requirements of federal law and
regulations.
Text of subsec. (l) as redesignated from subsec. (c) by Acts 1997,
75th Leg., ch. 905, Sec. 1
(l) The commissioner shall, within a reasonable period, approve any
form of the evidence of coverage or group contract, or amendment
thereto, if the requirements of this section are met. After notice
and hearing, the commissioner may withdraw previous approval of any
form, if the commissioner determines that it violates or does not
comply with this Act or a rule adopted by the commissioner. It shall
be unlawful to issue such form until approved. If the commissioner
disapproves such form, the commissioner shall notify the filer. In
the notice, the commissioner shall specify the reason for the
disapproval. A hearing shall be granted within 30 days after a
request in writing by the person filing. If the commissioner does
not disapprove any form within 30 days after the filing of such form
it shall be considered approved; provided that the commissioner
may by written notice extend the period for approval or disapproval
of any filing for such further time, not exceeding an additional 30
days, as necessary for proper consideration of the filing.
(m) The commissioner may require the submission of whatever
relevant information he or she deems necessary in determining
whether to approve or disapprove a filing made pursuant to this
section.
(n) Articles 3.51-9 and 3.74, Insurance Code, and Section 1(F)(5),
Chapter 397, Acts of the 54th Legislature, Regular Session, 1955
(Article 3.70-1(F)(5), Vernon's Texas Insurance Code), apply to
health maintenance organizations other than those health
maintenance organizations offering only a single health care
service plan.
(o) Evidence of coverage does not constitute a health insurance
policy as that term is defined by the Insurance Code.
(p) Article 3.72 of the Insurance Code applies to health
maintenance organizations to the extent that such article is not in
conflict with this Act and to the extent that the residential
treatment center or crisis stabilization unit is located within the
service area of the health maintenance organization and subject to
such inspection and review as required by this Act or the rules
hereunder.
(q) Article 21.55, Insurance Code, applies to out-of-area or
emergency claims for which benefits are not assigned or payment is
not made directly to the physician or provider.
(r) Redesignated as V.A.T.S. Insurance Code, art. 20A.09H by Acts
2001, 77th Leg., ch. 396, Sec. 5.
Acts 1975, 64th Leg., p. 519, ch. 214, Sec. 9, eff. Dec. 1, 1975.
Amended by Acts 1979, 66th Leg., p. 1451, ch. 638, Sec. 4, eff. June
13, 1979; Acts 1981, 67th Leg., p. 198, ch. 91, Sec. 2, eff. Jan. 1,
1982; Acts 1981, 67th Leg., 1st C.S., p. 64, ch. 7, Sec. 2, eff.
Nov. 10, 1981.
Subsecs. (a), (e), (f) amended and Subsec. (g) added by Acts 1985,
69th Leg., ch. 906, Sec. 5, eff. Aug. 26, 1985; Subsecs. (a) to (c)
amended by Acts 1987, 70th Leg., ch. 567, Sec. 6, eff. Sept. 1,
1987; Subsec. (h) added by Acts 1987, 70th Leg., ch. 1091, Sec. 3,
eff. Sept. 1, 1987; Acts 1987, 70th Leg., ch. 1096, art. I, Sec.
1.02, eff. Sept. 1, 1987; Subsec. (j) added by Acts 1989, 71st
Leg., ch. 155, Sec. 3, eff. Sept. 1, 1989; Subsec. (i) added by Acts
1991, 72nd Leg., ch. 242, Sec. 11.04, eff. Sept. 1, 1991; Subsec.
(a) amended by Acts 1997, 75th Leg., ch. 1023, Sec. 4, eff. Sept. 1,
1997; Subsecs. (k) and (l) added by Acts 1997, 75th Leg., ch. 837,
Sec. 4.01, eff. July 1, 1997; amended by Acts 1997, 75th Leg., ch.
905, Sec. 1, eff. Sept. 1, 1997; Subsec. (r) redesignated as
V.A.T.S. Insurance Code, art. 20A.09H by Acts 2001, 77th Leg., ch.
396, Sec. 5, eff. Sept. 1, 2001; Subsec. (a) amended by Acts 2003,
78th Leg., ch. 260, Sec. 1, eff. Sept. 1, 2003; Subsec. (a) amended
by Acts 2003, 78th Leg., ch. 261, Sec. 1, eff. Sept. 1, 2003.
For text of article as amended by Acts 1997, 75th Leg., ch. 163,
Sec. 5, Acts 1997, 75th Leg., ch. 837, Sec. 4.01, Acts 1997, 75th
Leg., ch. 1023, Sec. 4, Acts 1997, 75th Leg., ch. 1026, Sec. 7, see
art. 20A.09, post.
Art. 20A.09. Evidence of Coverage and Charges
Article repealed effective April 1, 2005.
Text of article as amended by Acts 1997, 75th Leg., ch. 163, Sec. 5,
Acts 1997, 75th Leg., ch. 837, Sec. 4.01, Acts 1997, 75th Leg., ch.
1023, Sec. 4, Acts 1997, 75th Leg., ch. 1026, Sec. 7
(a)(1) Every enrollee residing in this state is entitled to
evidence of coverage under a health care plan. If the enrollee
obtains coverage under a health care plan through an insurance
policy or a contract issued by a group hospital service
corporation, whether by option or otherwise, the insurer or the
group hospital service corporation shall issue the evidence of
coverage. Otherwise, the health maintenance organization shall
issue the evidence of coverage.
(2) No evidence of coverage, or amendment thereto, shall be issued
or delivered to any person in this state until a copy of the form of
evidence of coverage, or amendment thereto, has been filed with and
approved by the commissioner.
(3) An evidence of coverage shall contain:
(A) no provisions or statements which are unjust, unfair,
inequitable, misleading, deceptive, which encourage
misrepresentation, or which are untrue, misleading, or deceptive as
defined in Section 14 of this Act;
(B) a clear and complete statement, if a contract, or a reasonably
complete facsimile, if a certificate, of:
(i) the medical, health care services, limited health care
services, or single health care service and the issuance of other
benefits, if any, to which the enrollee is entitled under the health
care plan, limited health care service plan, or single health care
service plan;
(ii) any limitation on the services, kinds of services, benefits,
or kinds of benefits to be provided, including any deductible or
co-payment feature;
(iii) where and in what manner information is available as to how
services may be obtained; and
(iv) a clear and understandable description of the health
maintenance organization's methods for resolving enrollee
complaints, including the enrollee's right to appeal denials of an
adverse determination, as that term is defined by Section 12A of
this Act, to an independent review organization and the procedures
for making an appeal to an independent review organization. Any
subsequent changes may be evidenced in a separate document issued
to the enrollee;
(C) a provision that, if medically necessary covered services are
not available through network physicians or providers, the health
maintenance organization must, on the request of a network
physician or provider, within a reasonable time period allow
referral to a non-network physician or provider and shall fully
reimburse the non-network physician or provider at the usual and
customary or an agreed rate; each contract must further provide for
a review by a specialist of the same, or a similar, specialty as the
physician or provider to whom a referral is requested before the
health maintenance organization may deny a referral;
(D) a provision to allow enrollees with chronic, disabling, or
life-threatening illnesses to apply to the health maintenance
organization's medical director to utilize a nonprimary care
physician specialist as a primary care physician, provided that:
(i) the request includes information specified by the health
maintenance organization, including certification of medical need,
and is signed by the enrollee and the nonprimary care physician
specialist interested in serving as the primary care physician;
(ii) the nonprimary care physician specialist meets the health
maintenance organization's requirements for primary care physician
participation; and
(iii) the nonprimary care physician specialist is willing to accept
the coordination of all of the enrollee's health care needs;
(E) a provision that if the request for special consideration
specified in Paragraph (D) of this subdivision is denied, an
enrollee may appeal the decision through the health maintenance
organization's established complaint and appeals process; and
(F) a provision that the effective date of the new designation of a
nonprimary care physician specialist as set out in Paragraph (D) of
this subdivision shall not be retroactive; the health maintenance
organization may not reduce the amount of compensation owed to the
original primary care physician prior to the date of the new
designation.
(4) If an evidence of coverage provides benefits for rehabilitation
services and therapies, the provision of those services and
therapies that, in the opinion of a physician, are medically
necessary may not be denied, limited, or terminated if they meet or
exceed treatment goals for the enrollee. For a physically disabled
person, treatment goals may include maintenance of functioning or
prevention of or slowing of further deterioration.
(5) Any form of the evidence of coverage or group contract to be
used in this state, and any amendments thereto, are subject to the
filing and approval requirements of Subsection (c) of this section,
unless it is subject to the jurisdiction of the commissioner under
the laws governing health insurance or group hospital service
corporations, in which event the filing and approval provisions of
such law shall apply. To the extent, however, that such provisions
do not apply to the requirements of Subdivision (3) of this
subsection, the requirements of Subdivision (3) shall be
applicable.
(b) The formula or method for calculating the schedule of charges
for enrollee coverage for medical services or health care services
must be filed with the commissioner before it is used in conjunction
with any health care plan. The formula or method must be
established in accordance with actuarial principles for the various
categories of enrollees. The charges resulting from the
application of the formula or method may not be altered for an
individual enrollee based on the status of that enrollee's health.
The formula or method must produce charges that are not excessive,
inadequate, or unfairly discriminatory, and benefits must be
reasonable with respect to the rates produced by the formula or
method. A statement by a qualified actuary that certifies the
appropriateness of the formula or method must accompany the filing
together with supporting information considered adequate by the
commissioner.
(c) The commissioner shall, within a reasonable period, approve any
form of the evidence of coverage or group contract, or amendment
thereto, if the requirements of this section are met. After notice
and opportunity for hearing, the commissioner may withdraw previous
approval of any form, if the commissioner determines that it
violates or does not comply with this Act or a rule adopted by the
commissioner. It shall be unlawful to issue such form until
approved. If the commissioner disapproves such form, the
commissioner shall notify the filer. In the notice, the
commissioner shall specify the reason for the disapproval. A
hearing shall be granted within 30 days after a request in writing
by the person filing. If the commissioner does not disapprove any
form within 30 days after the filing of such form it shall be
considered approved; provided that the commissioner may by written
notice extend the period for approval or disapproval of any filing
for such further time, not exceeding an additional 30 days, as
necessary for proper consideration of the filing.
(d) The commissioner may require the submission of whatever
relevant information he or she deems necessary in determining
whether to approve or disapprove a filing made pursuant to this
section.
(e) Article 3.74 of the Texas Insurance Code applies to health
maintenance organizations other than those health maintenance
organizations offering only a single health care service plan.
(f) Article 3.51-9 of the Texas Insurance Code applies to health
maintenance organizations other than those health maintenance
organizations offering only a single health care service plan.
(g) Evidence of coverage does not constitute a health insurance
policy as that term is defined by the Insurance Code.
(h) Article 3.70-1(F)(5) of the Insurance Code applies to health
maintenance organizations other than those health maintenance
organizations offering only a single health care service plan.
(i) Article 3.72 of the Insurance Code applies to health
maintenance organizations to the extent that such article is not in
conflict with this Act and to the extent that the residential
treatment center or crisis stabilization unit is located within the
service area of the health maintenance organization and subject to
such inspection and review as required by this Act or the rules
hereunder.
(j) Redesignated as V.A.T.S. Insurance Code, art. 20A.09Z, by Acts
2001, 77th Leg., ch. 1419, Sec. 14.
Text of subsec. (k) as added by Acts 1997, 75th Leg., ch. 837, Sec.
4.01
(k) Continuation of Coverage and Conversion. (A) A health
maintenance organization shall provide a group continuation
privilege as required by this subsection. Any enrollee whose
coverage under the group contract has been terminated for any
reason except involuntary termination for cause, and who has been
continuously insured under the group contract and under any group
contract providing similar services and benefits which it replaces
for at least three consecutive months immediately prior to
termination shall be entitled to such privilege as outlined below.
Involuntary termination for cause does not include termination for
any health-related cause. Health maintenance organization
contracts subject to this section shall provide continuation of
group coverage for enrollees subject to the eligibility provisions
below:
(1) Continuation of group coverage must be requested in writing
within 31 days following the later of: (aa) the date the group
coverage would otherwise terminate; or (bb) the date the enrollee
is given notice of the right of continuation by either the employer
or the group contract holder.
(2) An enrollee electing continuation must pay to the group
contract holder or employer on a monthly basis, in advance, the
amount of contribution required by the contract holder or employer,
plus two percent of the group rate for the coverage being continued
under the group contract, on the due date of each payment.
(3) The enrollee's written election of continuation, together with
the first contribution required to establish contributions on a
monthly basis, in advance, must be given to the contract holder or
employer within 31 days following the later of: (aa) the date the
group coverage would otherwise terminate; or (bb) the date the
enrollee is given notice of the right of continuation by either the
employer or the group contract holder.
(4) Continuation may not terminate until the earliest of: (aa) six
months after the date the election is made; (bb) the date on which
failure to make timely payments would terminate coverage; (cc) the
date on which the covered person is covered for similar services and
benefits by another hospital, surgical, medical, or major medical
expense insurance policy or hospital or medical service subscriber
contract or medical practice or other prepayment plan or any other
plan or program; or (dd) the date on which the group coverage
terminates in its entirety.
(5) Not less than 30 days before the end of the six months after the
date the enrollee elects continuation of the contract, the health
maintenance organization shall notify the enrollee that he/she may
be eligible for coverage under the Texas Health Insurance Risk
Pool, as provided under Article 3.77, Insurance Code, and the
health maintenance organization shall provide the address for
applying to such pool to the enrollee.
(B) A health maintenance organization may offer to each enrollee a
conversion contract. Such conversion contract shall be issued
without evidence of insurability if written application for and
payment of the first premium is made not later than the 31st day
after the date of termination. The conversion contract shall meet
the minimum standards for services and benefits for conversion
contracts. The commissioner shall issue rules and regulations to
establish minimum standards for services and benefits under
contracts issued pursuant to this subdivision.
(C) The premium for a conversion contract issued under this Act
shall be determined in accordance with the health maintenance
organization's premium rates for coverage that were provided under
the group contract or plan. The premium may be based on geographic
location of each person to be covered and the type of conversion
contract and coverage provided. The premium for the same coverage
under a conversion contract may not exceed 200 percent of the
premium determined in accordance with this subdivision. The
premium must be based on the type of conversion contract and the
coverage provided by contract.
(k) Redesignated as V.A.T.S. Insurance Code, art. 20A.09H by Acts
2001, 77th Leg., ch. 396, Sec. 5.
Text of subsec. (l) as added by Acts 1997, 75th Leg., ch. 837, Sec.
4.01
(l) Individual Health Care Plan. A health maintenance organization
may provide an individual health care plan as required by this
subsection.
(A) For purposes of this subsection, an "individual health care
plan" means:
(1) a health care plan providing health care services for
individuals and their dependents;
(2) a health care plan in which an enrollee pays the premium and is
not being covered under the contract pursuant to continuation of
services and benefits provisions applicable under federal or state
law; and
(3) a plan in which the evidence of coverage meets the requirements
of Section 2(a) of this Act.
(B) A health maintenance organization may limit its enrollees to
those who live, reside, or work within the service area for such
network plan.
(C) Renewability of Coverage. An individual health care plan or a
conversion contract providing health care services shall be
renewable with respect to an enrollee at the option of the enrollee,
and may be nonrenewed based only on one or more of the following
reasons:
(1) failure to pay premiums or contributions in accordance with the
terms of the plan or the issuer has not received timely premium
payments;
(2) fraud or intentional misrepresentation;
(3) the health maintenance organization is ceasing to offer
coverage in the individual market in accordance with rules
established by the commissioner;
(4) enrollee no longer resides, lives, or works in the area in which
the health maintenance organization is authorized to provide
coverage, but only if such coverage is terminated under this
paragraph uniformly without regard to any health-status-related
factor of covered enrollees; or
(5) in accordance with applicable federal law and regulations.
(D) The commissioner may adopt rules necessary to implement this
subsection and to meet the minimum requirements of federal law and
regulations.
Text of subsec. (l) as added by Acts 1997, 75th Leg., ch. 1026, Sec.
7
(l) A health maintenance organization that offers a basic health
care plan shall provide or arrange for the provision of basic health
care services to its enrollees as needed and without limitations as
to time and cost other than limitations prescribed by rule of the
commissioner.
(m) Nothing in this Act shall require a health maintenance
organization, physician, or provider to recommend, offer advice
concerning, pay for, provide, assist in, perform, arrange, or
participate in providing or performing any health care service that
violates its religious convictions. A health maintenance
organization that limits or denies health care services under this
subsection shall set forth such limitations in the evidence of
coverage as required by Section 9(a)(3) of this Act.
(n) The commissioner may adopt minimum standards relating to basic
health care services.
Acts 1975, 64th Leg., p. 519, ch. 214, Sec. 9, eff. Dec. 1, 1975.
Amended by Acts 1979, 66th Leg., p. 1451, ch. 638, Sec. 4, eff. June
13, 1979; Acts 1981, 67th Leg., p. 198, ch. 91, Sec. 2, eff. Jan. 1,
1982; Acts 1981, 67th Leg., 1st C.S., p. 64, ch. 7, Sec. 2, eff.
Nov. 10, 1981.
Subsecs. (a), (e), (f) amended and Subsec. (g) added by Acts 1985,
69th Leg., ch. 906, Sec. 5, eff. Aug. 26, 1985; Subsecs. (a) to (c)
amended by Acts 1987, 70th Leg., ch. 567, Sec. 6, eff. Sept. 1,
1987; Subsec. (h) added by Acts 1987, 70th Leg., ch. 1091, Sec. 3,
eff. Sept. 1, 1987; Acts 1987, 70th Leg., ch. 1096, art. I, Sec.
1.02, eff. Sept. 1, 1987; Subsec. (j) added by Acts 1989, 71st
Leg., ch. 155, Sec. 3, eff. Sept. 1, 1989; Subsec. (i) added by Acts
1991, 72nd Leg., ch. 242, Sec. 11.04, eff. Sept. 1, 1991; Subsec.
(a) amended by Acts 1997, 75th Leg., ch. 1023, Sec. 4, eff. Sept. 1,
1997; Subsec. (a)(3) amended by Acts 1997, 75th Leg., ch. 163, Sec.
5, eff. Sept. 1, 1997; Subsecs. (k) and (l) added by Acts 1997, 75th
Leg., ch. 837, Sec. 4.01, eff. July 1, 1997; amended by Acts 1997,
75th Leg., ch. 1026, Sec. 7, eff. Sept. 1, 1997; Subsec. (k)
redesignated as V.A.T.S. Insurance Code, art. 20A.09H by Acts 2001,
77th Leg., ch. 396, Sec. 5, eff. Sept. 1, 2001; Subsec. (j)
redesignated as V.A.T.S. Insurance Code, art. 20A.09Z by Acts 2001,
77th Leg., ch. 1419, Sec. 14, eff. June 1, 2003.
For text of article as amended by Acts 1997, 75th Leg., ch. 837,
Sec. 4.01, Acts 1997, 75th Leg., ch. 905, Sec. 1, Acts 1997, 75th
Leg., ch. 1023, Sec. 4
Art. 20A.09B. Periodic health evaluations required
Article repealed effective April 1, 2005.
(a) The basic health care services provided under an evidence of
coverage must include periodic health evaluations for each adult
enrollee.
(b) The services provided under this section must include a health
risk assessment at least once every three years and, for a female
enrollee, an annual well-woman examination provided in accordance
with Article 21.53D of this code, as added by Chapter 912, Acts of
the 75th Legislature, Regular Session, 1997.
(c) This section does not apply to an evidence of coverage for a
limited health care service plan or a single health care service
plan.
Added by Acts 2001, 77th Leg., ch. 1369, Sec. 1, eff. Sept. 1, 2001.
Art. 20A.09E. Well-Child Care From Birth
Article repealed effective April 1, 2005.
(a) In this Act, "well-child care from birth" has the meaning used
under Section 1302, Public Health Service Act (42 U.S.C. Section
300e-1), and its subsequent amendments, and includes newborn
screening required by the Texas Department of Health.
(b) Each health maintenance organization shall ensure that each
health care plan provided by the organization includes well-child
care from birth that complies with the federal requirements adopted
under Chapter XI, Public Health Service Act (42 U.S.C. Section 300e
et seq.), and its subsequent amendments, and the rules adopted by
the Texas Department of Health to implement those requirements.
Added by Acts 1999, 76th Leg., ch. 1438, Sec. 1, eff. Aug. 30, 1999.
Art. 20A.09F. Immunizations of Children
Article repealed effective April 1, 2005.
In addition to an immunization required under Section 3(a), Article
21.53F, Insurance Code, each health maintenance organization shall
include in each health care plan provided by the organization
coverage for immunization against rotovirus and any other
immunization required for a child by statute or rule.
Added by Acts 1999, 76th Leg., ch. 1438, Sec. 1, eff. Sept. 1, 1999.
Art. 20A.09H. Dependent Grandchildren
Article repealed effective April 1, 2005.
Text of article as redesignated by Acts 2001, 77th Leg., ch. 396,
Sec. 5
(a) A health maintenance organization may provide benefits under a
health care plan to a dependent grandchild of an enrollee when the
dependent grandchild is less than 21 years old and living with and
in the household of the enrollee.
(b) For purposes of this section, a grandchild of an enrollee is a
dependent, regardless of whether the enrollee treats the grandchild
as a dependent for federal income tax purposes.
Added by Acts 1997, 75th Leg., ch. 837, Sec. 4.01, eff. July 1,
1997. Redesignated from V.A.T.S. Insurance Code, art. 20A.09,
subsec. (k) and amended by Acts 2001, 77th Leg., ch. 396, Sec. 5,
eff. Sept. 1, 2001.
For text of article as redesignated by Acts 2001, 77th Leg., ch.
1027, Sec. 7, see article 20A.09H, post.
Art. 20A.09H. Children and Grandchildren
Article repealed effective April 1, 2005.
Text of article as redesignated by Acts 2001, 77th Leg., ch. 1027,
Sec. 7
(a) If children are eligible for coverage under the terms of an
evidence of coverage, any limiting age applicable to an unmarried
child of an enrollee, including an unmarried grandchild of an
enrollee, is 25 years of age. The limiting age applicable to a
child must be stated in the evidence of coverage.
(b) A health maintenance organization may provide benefits under a
health care plan to a dependent grandchild of an enrollee who is
living with and in the household of the enrollee.
Added by Acts 1997, 75th Leg., ch. 837, Sec. 4.01, eff. July 1,
1997. Redesignated from V.A.T.S. Insurance Code, art. 20A.09,
subsec. (k) and amended by Acts 2001, 77th Leg., ch. 1027, Sec. 7.
For text of article as redesignated by Acts 2001, 77th Leg., ch.
396, Sec. 5, see article 20A.09H, ante.
Art. 20A.09N. Choice of Benefits Plan
(a) The legislature recognizes the need for individuals and
employers in this state to have the opportunity to choose health
maintenance organization plans that are more affordable and
flexible than existing market health care plans offered by health
maintenance organizations. The legislature, therefore, seeks to
increase the availability of health care plans by allowing health
maintenance organizations authorized to operate health maintenance
organizations in this state to issue group or individual evidences
of coverage that, in whole or in part, do not offer or provide
mandated health benefits.
(b) In this section, "standard health benefit plan" means a group or
individual evidence of coverage that, in whole or in part, does not
offer or provide state-mandated health benefits, but that provides
creditable coverage as defined by Article 26.035(a) of this code or
Section 1(H)(4)(b), Chapter 397, Acts of the 54th Legislature,
Regular Session, 1955 (Article 3.70-1, Vernon's Texas Insurance
Code).
(c) For purposes of this section, "state-mandated health benefits"
means coverage required under the Insurance Code or other laws of
this state to be provided in an evidence of coverage that:
(1) includes coverage for specific health care services or
benefits;
(2) places limitations or restrictions on deductibles,
coinsurance, copayments, or any annual or lifetime maximum benefit
amounts, including limitations provided in Section 9(l) of this
Act, as added by Chapter 1026, Acts of the 75th Legislature, Regular
Session, 1997; or
(3) includes a specific category of licensed health care
practitioner from whom an enrollee is entitled to receive care.
(d) For purposes of this section, "state-mandated health benefits"
does not include coverage that is mandated by federal law or
standard provisions or rights required under the Insurance Code or
other law of this state to be provided in an evidence of coverage
that are unrelated to specific health illnesses, injuries, or
conditions of an insured, including provisions related to:
(1) continuation of coverage under Section 3B, Article 3.51-6,
Insurance Code;
(2) termination of coverage under Articles 3.70-1A, 26.23, and
26.86, Insurance Code;
(3) preexisting conditions under Section 1(H), Chapter 397, Acts of
the 54th Legislature, Regular Session, 1955 (Article 3.70-1,
Vernon's Texas Insurance Code), and Articles 26.49 and 26.90,
Insurance Code;
(4) coverage of children, including newborn or adopted children,
under:
(A) Subchapter J, Chapter 3, Insurance Code;
(B) Article 21.24-2, Insurance Code;
(C) Article 26.21(n), Insurance Code;
(D) Article 26.21A, Insurance Code; and
(E) Article 26.84, Insurance Code;
(5) services of providers under Section 843.304 of this code;
(6) coverage for serious mental health illness under Article
3.51-14, Insurance Code, if the standard health benefit plan is
issued to a large employer as defined in Article 26.02, Insurance
Code; and
(7) coverage for cancer screenings under the following articles of
this code:
(A) Article 3.70-2(H), as added by Chapter 1091, Acts of the 70th
Legislature, Regular Session, 1987;
(B) Article 21.53F, as added by Chapter 1287, Acts of the 75th
Legislature, Regular Session, 1997; and
(C) Article 21.53S.
(e) A health maintenance organization authorized to issue an
evidence of coverage in this state may offer one or more standard
health benefit plans.
(f)(1) Each written application for enrollment in a standard health
benefit plan must contain the following language at the beginning
of the document in bold type:
"You have the option to choose this Consumer Choice of Benefits
Health Maintenance Organization health care plan that, either in
whole or in part, does not provide state-mandated health benefits
normally required in evidences of coverage in Texas. This standard
health benefit plan may provide a more affordable health plan for
you although, at the same time, it may provide you with fewer health
plan benefits than those normally included as state-mandated health
benefits in Texas. If you choose this standard health benefit plan,
please consult with your insurance agent to discover which
state-mandated health benefits are excluded in this evidence of
coverage."
(2) Each standard health benefit plan must contain the following
language at the beginning of the document in bold type:
"This Consumer Choice of Benefits Health Maintenance Organization
health care plan, either in whole or in part, does not provide
state-mandated health benefits normally required in evidences of
coverage in Texas. This standard health benefit plan may provide a
more affordable health plan for you although, at the same time, it
may provide you with fewer health plan benefits than those normally
included as state-mandated health benefits in Texas. Please
consult with your insurance agent to discover which state-mandated
health benefits are excluded in this evidence of coverage."
(g) A health maintenance organization providing a standard health
benefit plan must provide a proposed contract holder or a contract
holder with a written disclosure statement that:
(1) acknowledges that the standard health benefit plan being
purchased does not provide some or all state-mandated health
benefits;
(2) lists those state-mandated health benefits not included in the
standard health benefit plan; and
(3) if the standard health benefit plan is issued to an individual
certificate holder, provides a notice that purchase of the plan may
limit the certificate holder's future coverage options in the event
the certificate holder's health changes and needed benefits are not
available under the standard health benefit plan.
(h) Each applicant for initial enrollment and each contract holder
on renewal must sign the disclosure statement provided by the
health maintenance organization under Subsection (g) of this
section and return the statement to the health maintenance
organization. Under a group evidence of coverage, the term
"applicant" means the employer.
(i) A health maintenance organization must:
(1) retain the signed disclosure statement in the organization's
records; and
(2) on request from the commissioner, provide the signed disclosure
statement to the department.
(j) The commissioner shall adopt rules as necessary to implement
this section.
(k) A health maintenance organization that offers one or more
standard health benefit plans under this section must also offer at
least one evidence of coverage that provides state-mandated health
benefits and that is otherwise authorized by the Insurance Code.
(l) A health maintenance organization shall file for informational
purposes the rates to be used with a standard health benefit plan.
Nothing in this section shall be construed as granting the
commissioner any power or authority to determine, fix, prescribe,
or promulgate the rates to be charged for any evidence of coverage.
Added by Acts 2003, 78th Leg., ch. 1179, Sec. 2, eff. Sept. 1, 2003.
Art. 20A.09Y. Emergency Care Services
Article repealed effective April 1, 2005.
A health maintenance organization shall pay for emergency care
services performed by non-network physicians or providers at the
negotiated or usual and customary rate and that the health care plan
contains, without regard to whether the physician or provider
furnishing the services has a contractual or other arrangement with
the entity to provide items or services to covered individuals, the
following provisions and procedures for coverage of emergency care
services:
(1) any medical screening examination or other evaluation required
by state or federal law that is necessary to determine whether an
emergency medical condition exists will be provided to covered
enrollees in a hospital emergency facility or comparable facility;
(2) necessary emergency care services will be provided to covered
enrollees, including the treatment and stabilization of an
emergency medical condition; and
(3) services originated in a hospital emergency facility or
comparable facility following treatment or stabilization of an
emergency medical condition will be provided to covered enrollees
as approved by the health maintenance organization, provided that
the health maintenance organization is required to approve or deny
coverage of poststabilization care as requested by a treating
physician or provider within the time appropriate to the
circumstances relating to the delivery of the services and the
condition of the patient, but in no case to exceed one hour from the
time of the request; the health maintenance organization must
respond to inquiries from the treating physician or provider in
compliance with this provision in the health maintenance
organization's plan.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 13, eff. June 1, 2003.
Art. 20A.09Z. Prompt Payment of Claims
Article repealed effective April 1, 2005.
Text of article effective June 1, 2003
A health maintenance organization shall comply with Article 21.55
of the Insurance Code with respect to prompt payment to enrollees.
Added by Acts 1989, 71st Leg., ch. 155, Sec. 3, eff. Sept. 1, 1989.
Redesignated from V.A.T.S. Insurance Code, art. 20A.09, subsec. (j)
and amended by Acts 2001, 77th Leg., ch. 1419, Sec. 14, eff. June 1,
2003.
Art. 20A.18C. Delegation of certain functions
Article repealed effective April 1, 2005.
(a) A health maintenance organization that delegates any function
required by this Act shall execute a written agreement with each
delegated entity. The health maintenance organization shall file
the written agreement with the Texas Department of Insurance not
later than the 30th day after the date the agreement is executed.
The parties to each agreement shall determine the party that will
bear the expense of compliance with any requirement of this
subsection, including the cost of any examinations required by the
department under Article 1.15, Insurance Code, if applicable. The
written agreement must contain:
(1) a monitoring plan that allows the health maintenance
organization to monitor compliance with the minimum solvency
requirements established under Section 18D of this Act, if
applicable, and that includes:
(A) a description of financial practices that will ensure that the
delegated entity tracks and reports liabilities that have been
incurred but not reported;
(B) a summary of the total amount paid by the delegated entity to
physicians and providers on a monthly basis; and
(C) a summary of complaints from physicians, enrollees, and
providers regarding delays in payments of claims or nonpayment of
claims, including the status of each complaint, on a monthly basis;
(2) a provision that the agreement cannot be terminated without
cause by the delegated entity or the health maintenance
organization without written notice provided before the 90th day
preceding the termination date;
(3) a provision that prohibits the delegated entity and the
physicians and providers with whom it has contracted from billing
or attempting to collect from an enrollee under any circumstance,
including the insolvency of the health maintenance organization or
delegated entity, payments for covered services other than
authorized copayments and deductibles;
(4) a provision that the delegation agreement may not be construed
to limit in any way the health maintenance organization's authority
or responsibility, including financial responsibility, to comply
with all statutory and regulatory requirements;
(5) a provision that requires the delegated entity to comply with
all statutory and regulatory requirements relating to any function,
duty, responsibility, or delegation assumed by or carried out by
the delegated entity;
(6) a provision that requires the delegated entity to permit the
commissioner to examine at any time any information the
commissioner reasonably believes is relevant to:
(A) the financial solvency of the delegated entity; or
(B) the ability of the delegated entity to meet the entity's
responsibilities in connection with any function delegated to the
entity by the health maintenance organization;
(7) a provision that requires the delegated entity to provide the
license number of any delegated third party performing any function
that requires a license as a third party administrator under
Article 21.07-6, Insurance Code, or a license as a utilization
review agent under Article 21.58A, Insurance Code, or that requires
any other license under the Insurance Code or another insurance law
of this state;
(8) a provision that requires that:
(A) enrollees will receive notification at the time of enrollment
which entity has responsibility for performing utilization review;
(B) the delegated entity or third party performing utilization
review shall do so in accordance with Article 21.58A, Insurance
Code; and
(C) utilization review decisions made by the delegated entity or a
third party shall be forwarded to the health maintenance
organization on a monthly basis;
(9) a provision that requires that any agreement in which the
delegated entity directly or indirectly delegates any function
required by this Act, including the handling of funds, if
applicable, to a delegated third party be in writing;
(10) a provision that requires the delegated entity, in contracting
with a delegated third party directly or through a third party, to
require the delegated third party to comply with the requirements
of Subdivision (6) of this subsection and any rules adopted by the
commissioner implementing that subdivision;
(11) an acknowledgment and agreement by the delegated entity that:
(A) the health maintenance organization is:
(i) required to establish, operate, and maintain a health care
delivery system, quality assurance system, provider credentialing
system, and other systems and programs that meet statutory and
regulatory standards;
(ii) directly accountable for compliance with those standards; and
(iii) not precluded from contractually requesting that the
delegated entity provide proof of financial viability;
(B) the role of any delegated entity with which it subcontracts
through a delegated third party is limited to performing certain
delegated functions of the health maintenance organization, using
standards that are approved by the health maintenance organization
and that are in compliance with applicable statutes and rules and
subject to the health maintenance organization's oversight and
monitoring of the delegated entity's performance; and
(C) if the delegated entity fails to meet monitoring standards
established to ensure that functions delegated or assigned to the
entity under the delegation contract are in full compliance with
all statutory and regulatory requirements, the health maintenance
organization may cancel delegation of any or all delegated
functions;
(12) a provision that requires the delegated entity to make
available to the health maintenance organization samples of
contracts with physicians and providers to ensure compliance with
the contractual requirements described by Subdivisions (2) and (3)
of this subsection, except that the agreement may not require that
the delegated entity make available to the health maintenance
organization contractual provisions relating to financial
arrangements with the delegated entity's physicians and providers;
(13) a provision that requires the delegated entity to provide the
health maintenance organization, in a usable format necessary for
audit purposes and at most quarterly unless otherwise specified in
the agreement, the data necessary for the health maintenance
organization to comply with the department's reporting
requirements with respect to any delegated functions performed
under the delegation agreement, including:
(A) a summary:
(i) describing the methods, including capitation, fee-for-service,
or other risk arrangements, that the delegated entity used to pay
its physicians and providers; and
(ii) including the percentage of physicians and providers paid for
each payment category;
(B) the period that claims and debts for medical services owed by
the delegated entity have been pending and the aggregate dollar
amount of those claims and debts;
(C) information that will enable the health maintenance
organization to file claims for reinsurance, coordination of
benefits, and subrogation, if required by the health maintenance
organization's contract with the delegated entity; and
(D) documentation, except for information, documents, and
deliberations related to peer review that are confidential or
privileged under Subchapter A, Chapter 160, Occupations Code, that
relates to:
(i) a regulatory agency's inquiry or investigation of the delegated
entity or of an individual physician or provider with whom the
delegated entity contracts that relates to an enrollee of the
health maintenance organization; and
(ii) the final resolution of a regulatory agency's inquiry or
investigation; and
(14) a provision relating to enrollee complaints that requires the
delegated entity to ensure that upon receipt of a complaint, as
defined by this Act, the delegated entity shall report the
complaint to the health maintenance organization within two
business days, except that in a case in which a complaint involves
emergency care, as defined in this Act, the delegated entity shall
forward the complaint immediately to the health maintenance
organization, and provided that nothing in this subdivision
prohibits the delegated entity from attempting to resolve a
complaint.
(b) The commissioner shall determine the information that a health
maintenance organization shall provide to each delegated entity
with which the health maintenance organization has a delegation
agreement. The information must include the following information,
provided in standard electronic format at least monthly unless
otherwise stated in the agreement:
(1) the names and dates of birth or social security numbers of the
enrollees of the health maintenance organization who are eligible
or assigned to receive services from the delegated entity,
including the enrollees added and terminated since the previous
reporting period;
(2) the age, sex, benefit plan and any riders to that benefit plan,
and employer for the enrollees of the health maintenance
organization who are eligible or assigned to receive services from
the delegated entity;
(3) if the health maintenance organization pays any claims for the
delegated entity, a summary of the number and amount of claims paid
by the health maintenance organization on behalf of the delegated
entity during the previous reporting period, provided that a
delegated entity is not precluded from receiving, upon request,
additional nonproprietary information regarding such claims;
(4) if the health maintenance organization pays any claims for the
delegated entity, a summary of the number and amount of pharmacy
prescriptions paid for each enrollee for which the delegated entity
has taken partial risk during the previous reporting period,
provided that a delegated entity is not precluded from receiving,
upon request, additional nonproprietary information regarding such
claims;
(5) information that enables the delegated entity to file claims
for reinsurance, coordination of benefits, and subrogation; and
(6) patient complaint data that relates to the delegated entity.
(c) In addition to the information required by Subsection (b) of
this section, a health maintenance organization shall provide to a
delegated entity:
(1) detailed risk-pool data, reported quarterly and on settlement;
and
(2) the percent of premium attributable to hospital or facility
costs, if hospital or facility costs impact the delegated entity's
costs, reported quarterly, and, if there are changes in hospital or
facility contracts with the health maintenance organization, the
projected impact of those changes on the percent of premium
attributable to hospital and facility costs within 30 days of such
changes.
(d) A health maintenance organization that becomes aware of any
information that indicates the delegated entity is not operating in
accordance with its written agreement or is operating in a
condition that renders the continuance of its business hazardous to
the enrollees, shall:
(1) notify the delegated entity in writing of those findings;
(2) request, in writing, a written explanation, with documentation
supporting the explanation, of:
(A) the delegated entity's apparent noncompliance with the written
agreement; or
(B) the existence of the condition that apparently renders the
continuance of the delegated entity's business hazardous to the
enrollees; and
(3) provide the commissioner with copies of all notices and
requests submitted to the delegated entity and the responses and
other documentation the health maintenance organization generates
or receives in response to the notices and requests.
(e) A delegated entity shall respond to a request from a health
maintenance organization under Subsection (d) of this section in
writing not later than the 30th day after the date the request is
received.
(f) The health maintenance organization shall cooperate with the
delegated entity to correct any failure by the delegated entity to
comply with the regulatory requirements of the department relating
to any matters:
(1) delegated to the delegated entity by the health maintenance
organization; or
(2) necessary for the health maintenance organization to ensure
compliance with statutory or regulatory requirements.
(g) On receipt of a notice under Subsection (d) of this section, or
if complaints are filed with the Texas Department of Insurance, the
department may examine the matters contained in the notice as well
as any other matter relating to the financial solvency of the
delegated entity or the delegated entity's ability to meet its
responsibilities in connection with any function delegated to the
entity by the health maintenance organization.
(h) Except as provided by this subsection, the Texas Department of
Insurance, on completion of the department's examination, shall
report to the delegated entity and the health maintenance
organization the results of the department's examination and any
action the department determines is necessary to ensure that the
health maintenance organization meets its responsibilities under
this Act, the Insurance Code, any other insurance laws of this
state, and rules adopted by the commissioner, and that the
delegated entity can meet its responsibilities in connection with
any function delegated to the entity by the health maintenance
organization. The department may not report to the health
maintenance organization any information regarding fee schedules,
prices, cost of care, or other information not relevant to the
monitoring plan.
(i) The delegated entity and the health maintenance organization
shall respond to the department's report and submit a corrective
plan to the Texas Department of Insurance not later than the 30th
day after the date of receipt of the department's report.
(j) Reports and corrective plans required under Subsection (h) or
(i) of this section shall be treated as public documents, except
that health care provider fee schedules, prices, costs of care, or
other information not relevant to the monitoring plan and any other
information that is considered confidential by law shall be
considered confidential.
(k) The department may request at any time that a delegated entity
take corrective action to comply with the department's statutory
and regulatory requirements that:
(1) relate to any matters delegated by the health maintenance
organization to the delegated entity; or
(2) are necessary to ensure the health maintenance organization's
compliance with statutory and regulatory requirements.
(l) Regardless of whether a delegated entity complies with a
request for corrective action, the commissioner may order the
health maintenance organization to take any action the commissioner
determines is necessary to ensure that the health maintenance
organization is in compliance with this Act, including:
(1) reassuming the functions delegated to the delegated entity,
including claims payments for services previously rendered to
enrollees of the health maintenance organization;
(2) temporarily or permanently ceasing assignment of new enrollees
to the delegated entity;
(3) temporarily or permanently transferring enrollees to
alternative delivery systems to receive services; or
(4) terminating the health maintenance organization's contract
with the delegated entity.
(m) The Texas Department of Insurance shall maintain enrollee and
provider complaints in a manner that identifies complaints made
about limited provider networks and delegated entities. The
department shall periodically issue a report on the complaints
received by the department that includes a list of complaints by
category, by action taken on the complaint, and by entity or network
name and type. The department shall make the report available to
the public and shall include information to assist the public in
evaluating the information contained in the report.
(n) Notwithstanding any other provision of this Act, the Insurance
Code, or any other insurance law of this state, the commissioner may
suspend or revoke the license of any third party administrator or
utilization review agent that fails to comply with this section.
(o) The commissioner may impose sanctions or penalties under
Chapters 82, 83, and 84, Insurance Code, against a health
maintenance organization that does not provide timely information
required by Subsections (b) and (c) of this section.
(p) A health maintenance organization shall by contract establish
penalties for delegated entities that do not provide timely
information required under a monitoring plan as required by
Subsection (a)(1) of this section.
(q) This section does not apply to a group model health maintenance
organization, as defined by Section 6A of this Act.
(r) The commissioner may adopt rules as necessary to implement this
section.
Added by Acts 1999, 76th Leg., ch. 621, Sec. 2, eff. Sept. 1, 1999.
Amended by Acts 2001, 77th Leg., ch. 550, Sec. 4, eff. Sept. 1,
2001.
Art. 20A.18D. Reserve Requirements for Delegated Network
Article repealed effective April 1, 2005.
(a) A delegated network shall establish and maintain reserves that
are adequate for the liabilities and risks assumed by the delegated
network, as computed in accordance with accepted standards,
practices, and procedures relating to the liabilities and risks
reserved for, including known and unknown components and
anticipated expenses of providing benefits or services.
(b) Except as provided by Subsections (c) and (d), the delegated
network shall establish and maintain reserves as described by
Subsection (e)(1) or (2) only with respect to the portion of
services assumed under the delegation agreement that are not within
the scope of the network's license for medical care or hospital or
other institutional services, as applicable.
(c) If the scope of services assumed under the delegation agreement
includes both medical care and hospital or institutional services,
the delegated network shall establish and maintain reserves that
are adequate to cover the liabilities and risks associated with
medical care or with hospital or institutional services, whichever
type of services has been allocated the largest portion of the
premium by the health maintenance organization.
(d) If the delegated network assumes financial risk for medical
care or hospital or institutional services and for prescription
drugs, as defined by Section 551.003, Occupations Code, the network
shall establish and maintain reserves that are adequate to cover
the liabilities and risks associated with the prescription drug
benefits, in addition to any other reserves required under this
section.
(e) A delegated network shall maintain financial reserves equal to
the greater of:
(1) 80 percent of the risk and liabilities that must be reserved
under this section and that have been incurred but not paid by the
delegated network; or
(2) two months of premium amount assumed by the delegated network
for services that must be reserved under this section.
(f) The reserves required under this section must be secured by and
only consist of legal tender of the United States or bonds of the
United States or this state. The reserves must be held at a
financial institution in this state that is chartered by the United
States or this state. The reserves must be held in trust for, for
the benefit of, or to provide health care services to, enrollees of
the health maintenance organization under the agreement between the
health maintenance organization and the delegated network.
(g)(1) A delegated network required to establish and maintain
reserves under this section shall establish an escrow account for
the payment of claims and deposit such reserves into the escrow
account upon providing notice of its intent to terminate or
non-renew a contract through which the delegated network assumed
liabilities and risks from a health maintenance organization. Upon
the establishment of the escrow account, the delegated network
shall notify the commissioner.
(2) A delegated network required to establish and maintain reserves
under this section shall establish an escrow account for the
payment of claims and deposit such reserves into the escrow account
upon the modification of a contract through which the delegated
network assumed liabilities and risks from a health maintenance
organization if the modified contract eliminates the liabilities
and risks previously assumed by the delegated network. Upon the
establishment of the escrow account, the delegated network shall
notify the commissioner.
(3) Two hundred seventy days after the date the reserves are
deposited into the escrow account, the delegated network shall be
entitled to the release of the remaining amounts held in escrow.
(4) The amounts released from the escrow account shall be
distributed to those individuals who contributed to the reserves
deposited into escrow in proportion to the individuals' total
contribution.
(5) The commissioner shall, and has the authority to, take any
action necessary to ensure the release of any amounts remaining in
escrow in excess of the 270-day time period in Subsection (g)(3).
(h) This section does not apply to a group model health maintenance
organization, as defined by Section 6A of this Act.
Added by Acts 2001, 77th Leg., ch. 550, Sec. 5, eff. Sept. 1, 2001.
Art. 20A.18E. Certain Physician and Provider Contracts; Continuity
of Care for Certain Enrollees
Article repealed effective April 1, 2005.
(a) In this section, "special circumstance" means a condition for
which the treating physician or provider reasonably believes that
discontinuing care by the treating physician or provider could
cause harm to the patient.
(b) Each contract between a health maintenance organization and a
limited provider network or delegated entity must require that each
contract between the network or entity and a physician or provider
provide that:
(1) reasonable advance notice be given to an enrollee of the
impending termination from the limited provider network or
delegated entity of a physician or provider who is currently
treating the enrollee; and
(2) the termination of the physician or provider contract, except
for reason of medical competence or professional behavior, does not
release the limited provider network or delegated entity from the
obligation to reimburse a physician or provider who is treating an
enrollee of special circumstance, such as a person who has a
disability, acute condition, or life-threatening illness or is past
the 24th week of pregnancy, at a rate that is not less than the
contract rate for that enrollee's care in exchange for continuity
of ongoing treatment of an enrollee then receiving medically
necessary treatment in accordance with the dictates of medical
prudence.
(c) A special circumstance shall be identified by the treating
physician or provider, who must request that the enrollee be
permitted to continue treatment under the physician's or provider's
care and agree not to seek payment from the patient of any amounts
for which the enrollee would not be responsible if the physician or
provider were still in the limited provider network or delegated
entity.
(d) Contracts between a limited provider network or delegated
entity and physicians or providers shall provide procedures for
resolving disputes regarding the necessity for continued treatment
by a physician or provider.
(e) This section does not extend the obligation of a limited
provider network or delegated entity to reimburse a terminated
physician or provider for ongoing treatment of an enrollee beyond
the 90th day after the effective date of the termination, or beyond
nine months in the case of an enrollee who at the time of the
termination has been diagnosed with a terminal illness. However,
the obligation of the limited provider network or delegated entity
to reimburse the terminated physician or provider or, if
applicable, the enrollee for services to an enrollee who at the time
of the termination is past the 24th week of pregnancy, extends
through delivery of the child, immediate postpartum care, and the
follow-up checkup within the first six weeks of delivery.
Added by Acts 2001, 77th Leg., ch. 550, Sec. 5, eff. Sept. 1, 2001.
Art. 20A.18F. Out-of-Network Services of Limited Provider Network
or Delegated Entity
Article repealed effective April 1, 2005.
(a) Each contract between a health maintenance organization and a
limited provider network or delegated entity must provide that if
medically necessary covered services are not available through
network physicians or providers, the limited provider network or
delegated entity must, on request of a network physician or
provider, allow a referral to a non-network physician or provider
and shall fully reimburse the non-network provider at the usual and
customary or an agreed-upon rate.
(b) The referral shall be allowed within the time appropriate to the
circumstances relating to the delivery of the services and the
condition of the patient, but not later than the fifth business day
after the date any reasonably requested documentation is received
by the limited provider network or delegated entity.
(c) The enrollee may not be required to change the enrollee's
primary care physician or specialist providers to receive medically
necessary covered services that are not available within the
limited provider network or delegated entity.
(d) Each contract must also provide for a review by a specialist of
the same or similar specialty as the type of physician or provider
to whom a referral is requested before the limited provider network
or delegated entity may deny a referral.
(e) A denial of out-of-network services under this section is
subject to appeal under Article 21.58A, Insurance Code.
Added by Acts 2001, 77th Leg., ch. 550, Sec. 5, eff. Sept. 1, 2001.
Art. 20A.18G. Compliance of Limited Provider Network or Delegated
Entity with Certain Requirements
Article repealed effective April 1, 2005.
A limited provider network or delegated entity shall comply with
all statutory and regulatory requirements relating to any function,
duty, responsibility, or delegation assumed by or carried out by
the limited provider network or delegated entity under this Act.
Added by Acts 2001, 77th Leg., ch. 550, Sec. 5, eff. Sept. 1, 2001.
Art. 20A.33. Taxation
Article repealed effective April 1, 2005.
(a) Each health maintenance organization shall on or before the
first day of March of each year file its annual statement showing
the gross amount of revenues collected during the year ending
December 31 preceding, and each such health maintenance
organization shall pay an annual tax for the gross amounts of
revenues collected for the issuance of health maintenance
certificates or contracts at the rate provided by Article 4.11,
Insurance Code, as amended. For the purposes of computing and
collecting the tax herein provided, a health maintenance
organization is an "insurance organization" within the terms of
Article 4.11, Insurance Code, as amended.
(b) Repealed by Acts 1993, 73rd Leg., ch. 685, Sec. 3.29(6), eff.
Sept. 1, 1993.
(c) Each health maintenance organization covered by Subsection (a)
of this section shall be subject to Articles 4.13, 4.14, and 4.15,
Insurance Code.
(d) The commissioner shall annually determine the rate of
assessment of a per capita maintenance tax to be paid on an annual
or semiannual basis, on the correctly reported gross revenues for
the issuance of health maintenance certificates or contracts
collected by all authorized health maintenance organizations
issuing such coverages in this state. The rate of assessment may
not exceed $2 for each enrollee. The rate of assessment may differ
between basic health care plans, limited health care service plans,
and single health care service plans and shall equitably reflect
any differences in regulatory resources attributable to each type
of plan. The comptroller shall collect the maintenance tax. For
purposes of this section, the amount of maintenance tax assessed
may not be computed on enrollees who as individual certificate
holders or their dependents are covered by a master group policy
paid for by revenues received from the United States for insurance
contracted for by the United States in accordance with or in
furtherance of Title XVIII of the federal Social Security Act (42
U.S.C. Section 1395c et seq.) and its subsequent amendments.
(e) The tax required by this section is in addition to all other
taxes now imposed or that may be subsequently imposed and that are
not in conflict with this section.
(f) The commissioner, after taking into account the unexpended
funds produced by this tax, if any, shall adjust the rate of
assessment each year to produce the amount of funds that it
estimates will be necessary to pay all the expenses of regulating
health maintenance organizations during the succeeding year. In
making an estimate under this subsection, the commissioner shall
take into account the requirement that the general revenue fund be
reimbursed under Article 4.19, Insurance Code.
(g) The taxes collected shall be deposited in the State Treasury to
the credit of the general revenue fund to be reallocated to the
Texas Department of Insurance operating fund and shall be spent as
authorized by legislative appropriation on warrants issued by the
comptroller pursuant to duly certified requisitions of the
commissioner. Amounts reallocated to the Texas Department of
Insurance operating fund under this subsection may be transferred
to the general revenue fund in accordance with Article 4.19,
Insurance Code.
(h) The comptroller may collect the tax assessed under this section
on a semiannual or other periodic basis from those health
maintenance organizations whose tax liability under this section
for the previous year was $2,000 or more.
(i) The commissioner shall advise the comptroller of the applicable
rate of assessment no later than the date 45 days prior to the due
date of the tax return for the period for which such taxes are due.
If the commissioner has not advised the comptroller of the
applicable rate by such date, the applicable rate shall be the rate
applied in the previous tax period. If the commissioner advises the
comptroller of the applicable rate of assessment after taxes have
been assessed pursuant to this subsection, the comptroller shall:
(1) advise each taxpayer in writing of the amount of any additional
taxes due; or
(2) refund any excess taxes paid.
Acts 1975, 64th Leg., p. 530, ch. 214, Sec. 33, eff. Dec. 1, 1975.
Amended by Acts 1979, 66th Leg., p. 1456, ch. 638, Sec. 14, eff.
June 13, 1979; Acts 1981, 67th Leg., p. 1784, ch. 389, Sec. 37(c),
eff. Jan. 1, 1982.
Subsec. (a) amended by Acts 1983, 68th Leg., p. 3938, ch. 622, Sec.
30, eff. Sept. 1, 1983; Acts 1985, 69th Leg., ch. 304, Sec. 2, eff.
Aug. 26, 1985. Amended by Acts 1987, 70th Leg., ch. 249, Sec. 8,
eff. Aug. 31, 1987; Subsec. (a) amended by Acts 1989, 71st Leg.,
ch. 237, Sec. 2, eff. Aug. 28, 1989; Subsec. (d) amended by Acts
1989, 71st Leg., ch. 284, Sec. 6, eff. Sept. 1, 1989; Subsec. (b)
repealed by Acts 1993, 73rd Leg., ch. 685, Sec. 3.29(6), eff. Sept.
1, 1993; Subsec. (d) amended and subsecs. (e) to (i) added by Acts
1993, 73rd Leg., ch. 685, Sec. 3.20, eff. Sept. 1, 1993; Subsec.
(d) amended by Acts 1997, 75th Leg., ch. 1023, Sec. 10, eff. Sept.
1, 1997; amended by Acts 1997, 75th Leg., ch. 1040, Sec. 73, eff.
Sept. 1, 1997; Subsec. (d) amended by Acts 2003, 78th Leg., ch.
198, Sec. 2.121(a), eff. Sept. 1, 2003.
Art. 20A.39. Credentialing of Physicians and Providers
Article repealed effective April 1, 2005.
(a) Rules adopted by the commissioner under Section 37 of this Act
that relate to implementation and maintenance by a health
maintenance organization of a process for selecting and retaining
affiliated physicians and providers must comply with:
(1) this section; and
(2) standards promulgated by the National Committee for Quality
Assurance, to the extent those standards do not conflict with other
laws of this state.
(b) The commissioner shall require a health maintenance
organization to verify that a physician's license to practice
medicine and any other certificate the physician is required to
hold, including a certificate issued by the Department of Public
Safety of the State of Texas or the federal Drug Enforcement Agency
or a certificate issued under the Medicare program, is valid as of
the date of initial credentialing and on the date of each
recredentialing.
(c) The commissioner shall require a health maintenance
organization that conducts a site visit for the purpose of initial
credentialing to evaluate during the visit a site's accessibility,
appearance, space, medical or dental recordkeeping practices,
availability of appointments, and confidentiality procedures. The
commissioner may not require the health maintenance organization to
evaluate the appropriateness of equipment during the site visit.
(d) The commissioner may not require that a health maintenance
organization:
(1) formally recredential physicians or providers more frequently
than once in any three-year period;
(2) verify the validity of a license or certificate held by a
physician other than as of the date of initial credentialing or
recredentialing of the physician;
(3) use clinical personnel to perform a site visit for initial
credentialing of a physician or provider unless clinical review is
needed during the site visit; or
(4) require a site visit be performed for recredentialing of a
physician or provider.
(e) This section does not preclude a health maintenance
organization from performing a site visit of a physician or
provider at any time for cause, including a complaint made by a
member or another external complaint made to the health maintenance
organization.
Added by Acts 2001, 77th Leg., ch. 1369, Sec. 2, eff. Sept. 1, 2001.
