SB926 - Relating to certain practices of health benefit plan issuers to encourage the use of certain physicians and health care providers and rank physicians.

      S.B. No. 926         AN ACT   relating to certain practices of health benefit plan issuers to   encourage the use of certain physicians and health care providers   and rank physicians.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter I, Chapter 843, Insurance Code, is   amended by adding Section 843.322 to read as follows:           Sec.   843.322.     INCENTIVES TO USE CERTAIN PHYSICIANS OR   PROVIDERS. (a)   A health maintenance organization may provide   incentives for enrollees to use certain physicians or providers   through modified deductibles, copayments, coinsurance, or other   cost-sharing provisions.           (b)     A health maintenance organization that encourages an   enrollee to obtain a health care service from a particular   physician or provider, including offering incentives to encourage   enrollees to use specific physicians or providers, or that   introduces or modifies a tiered network plan or assigns physicians   or providers into tiers, has a fiduciary duty to the enrollee or   group contract holder to engage in that conduct only for the primary   benefit of the enrollee or group contract holder.           (c)     A health maintenance organization violates the   fiduciary duty described by Subsection (b) by offering incentives   to encourage enrollees to use a particular physician or provider   solely because the physician or provider directly or indirectly   through one or more intermediaries controls, is controlled by, or   is under common control with the health maintenance organization.           (d)     Conduct that violates the fiduciary duty described by   Subsection (b) includes:                 (1)     using a steering approach or a tiered network to   provide a financial incentive as an inducement to limit medically   necessary services, encourage receipt of lower quality medically   necessary services, or violate state or federal law;                 (2)     failing to implement reasonable procedures to   ensure that:                       (A)     participating providers that enrollees are   encouraged to use within any steering approach or tiered network   are not of materially lower quality than participating providers   that enrollees are not encouraged to use; and                       (B)     the health maintenance organization does not   make materially false statements or representations about a   physician's or provider's quality of care or costs; and                 (3)     failing to use objective, verifiable, and accurate   information as the basis of any encouragement or incentive under   this section.           (e)     An encouragement or incentive authorized by this   section may not:                 (1)  be based solely on cost; or                 (2)     impose a cost-sharing requirement for   out-of-network emergency services that is greater than the   cost-sharing requirement that would apply had the services been   furnished by a participating provider.           (f)     This section does not apply to a vision care plan, as   defined by Section 1451.157.          SECTION 2.  Section 1301.0045(a), Insurance Code, is amended   to read as follows:          (a)  Except as provided by Sections [ Section ] 1301.0046 and   1301.0047 , this chapter may not be construed to limit the level of   reimbursement or the level of coverage, including deductibles,   copayments, coinsurance, or other cost-sharing provisions, that   are applicable to preferred providers or, for plans other than   exclusive provider benefit plans, nonpreferred providers.          SECTION 3.  Subchapter A, Chapter 1301, Insurance Code, is   amended by adding Section 1301.0047 to read as follows:           Sec.   1301.0047.     INCENTIVES TO USE CERTAIN PHYSICIANS OR   HEALTH CARE PROVIDERS. (a)   An insurer may provide incentives for   insureds to use certain physicians or health care providers through   modified deductibles, copayments, coinsurance, or other   cost-sharing provisions.           (b)     An insurer that encourages an insured to obtain a health   care service from a particular physician or health care provider,   including offering incentives to encourage insureds to use specific   physicians or providers, or that introduces or modifies a tiered   network plan or assigns physicians or providers into tiers, has a   fiduciary duty to the insured or policyholder to engage in that   conduct only for the primary benefit of the insured or   policyholder.           (c)     An insurer violates the fiduciary duty described by   Subsection (b) by offering incentives to encourage insureds to use   a particular physician or health care provider solely because the   physician or provider directly or indirectly through one or more   intermediaries controls, is controlled by, or is under common   control with the insurer.           (d)     Conduct that violates the fiduciary duty described by   Subsection (b) includes:                 (1)     using a steering approach or a tiered network to   provide a financial incentive as an inducement to limit medically   necessary services, encourage receipt of lower quality medically   necessary services, or violate state or federal law;                 (2)     failing to implement reasonable procedures to   ensure that:                       (A)     preferred providers that insureds are   encouraged to use within any steering approach or tiered network   are not of materially lower quality than preferred providers that   insureds are not encouraged to use; and                       (B)     the insurer does not make materially false   statements or representations about a physician's or health care   provider's quality of care or costs; and                 (3)     failing to use objective, verifiable, and accurate   information as the basis of any encouragement or incentive under   this section.           (e)     An encouragement or incentive authorized by this   section may not:                 (1)  be based solely on cost; or                 (2)     impose a cost-sharing requirement for   out-of-network emergency services that is greater than the   cost-sharing requirement that would apply had the services been   furnished by a preferred provider.           (f)     This section does not apply to a vision care plan, as   defined by Section 1451.157.          SECTION 4.  Section 1460.003, Insurance Code, is amended by   amending Subsection (a) and adding Subsection (a-1) to read as   follows:          (a)  A health benefit plan issuer, including a subsidiary or   affiliate, may not rank physicians or [ , ] classify physicians into   tiers based on performance[ , or publish physician-specific   information that includes rankings, tiers, ratings, or other   comparisons of a physician's performance against standards,   measures, or other physicians, ] unless:                (1)   the standards used by the health benefit plan   issuer to rank or classify are developed or prescribed by an   organization designated by the commissioner through rules adopted   under Section 1460.005;                 (2)     the ranking or classification and any methodology   used to rank or classify:                       (A)     is disclosed to each affected physician at   least 45 days before the date the ranking or classification is   released, published, or distributed by the health benefit plan   issuer; and                       (B)     identifies which products or networks   offered by the health benefit plan issuer the ranking or   classification will be used for; and                 (3)     each affected physician is given an easy-to-use   process to identify:                       (A)     before the release, publication, or   distribution of the ranking or classification, any discrepancy   between the standards and the ranking or classification proposed by   the health benefit plan issuer; and                       (B)     after the release, publication, or   distribution of the ranking or classification, any objectively and   verifiably false information contained in the ranking or   classification [ the standards used by the health benefit plan   issuer conform to nationally recognized standards and guidelines as   required by rules adopted under Section 1460.005;                [ (2)     the standards and measurements to be used by the   health benefit plan issuer are disclosed to each affected physician   before any evaluation period used by the health benefit plan   issuer; and                [ (3)     each affected physician is afforded, before any   publication or other public dissemination, an opportunity to   dispute the ranking or classification through a process that, at a   minimum, includes due process protections that conform to the   following protections:                      [ (A)     the health benefit plan issuer provides at   least 45 days' written notice to the physician of the proposed   rating, ranking, tiering, or comparison, including the   methodologies, data, and all other information utilized by the   health benefit plan issuer in its rating, tiering, ranking, or   comparison decision;                      [ (B)     in addition to any written fair   reconsideration process, the health benefit plan issuer, upon a   request for review that is made within 30 days of receiving the   notice under Paragraph (A), provides a fair reconsideration   proceeding, at the physician's option:                            [ (i)     by teleconference, at an agreed upon   time; or                            [ (ii)     in person, at an agreed upon time or   between the hours of 8:00 a.m. and 5:00 p.m. Monday through Friday;                      [ (C)     the physician has the right to provide   information at a requested fair reconsideration proceeding for   determination by a decision-maker, have a representative   participate in the fair reconsideration proceeding, and submit a   written statement at the conclusion of the fair reconsideration   proceeding; and                      [ (D)     the health benefit plan issuer provides a   written communication of the outcome of a fair reconsideration   proceeding prior to any publication or dissemination of the rating,   ranking, tiering, or comparison.   The written communication must   include the specific reasons for the final decision ].           (a-1)     If a physician submits information under Subsection   (a)(3) s [Text truncated for display. 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