Current through Reg. 50, No. 13; March 28, 2025
(a) An insurer
marketing a preferred provider benefit plan must contract with physicians and
health care providers to ensure that all medical and health care services and
items contained in the package of benefits for which coverage is provided,
including treatment of illnesses and injuries, will be provided under the plan
in a manner that ensures both availability and accessibility of adequate
personnel, specialty care, and facilities. Each contract must meet the
following requirements:
(1) A contract between
a preferred provider and an insurer may not restrict a physician or health care
provider from contracting with other insurers, preferred provider plans,
preferred provider networks or organizations, exclusive provider benefit plans,
exclusive provider networks or organizations, health care collaboratives, or
HMOs.
(2) Any term or condition
limiting participation on the basis of quality that is contained in a contract
between a preferred provider and an insurer is required to be consistent with
established standards of care for the profession.
(3) In the case of physicians or
practitioners with hospital or institutional provider privileges who provide a
significant portion of care in a hospital or institutional provider setting, a
contract between a preferred provider and an insurer may contain terms and
conditions that include the possession of practice privileges at preferred
hospitals or institutions, except that if no preferred hospital or institution
offers privileges to members of a class of physicians or practitioners, the
contract may not provide that the lack of hospital or institutional provider
privileges may be a basis for denial of participation as a preferred provider
to such physicians or practitioners of that class.
(4) A contract between an insurer and a
hospital or institutional provider must not, as a condition of staff membership
or privileges, require a physician or practitioner to enter into a preferred
provider contract. This prohibition does not apply to requirements concerning
practice conditions other than conditions of membership or
privileges.
(5) A contract between
a preferred provider and an insurer may provide that the preferred provider
will not bill the insured for unnecessary care, if a physician or practitioner
panel has determined the care was unnecessary, but the contract may not require
the preferred provider to pay hospital, institutional, laboratory, X-ray, or
like charges resulting from the provision of services lawfully ordered by a
physician or health care provider, even though such service may be determined
to be unnecessary.
(6) A contract
between a preferred provider and an insurer may not:
(A) contain restrictions on the classes of
physicians and practitioners who may refer an insured to another physician or
practitioner; or
(B) require a
referring physician or practitioner to bear the expenses of a referral for
specialty care in or out of the preferred provider panel. Savings from
cost-effective utilization of health services by contracting physicians or
health care providers may be shared with physicians or health care providers in
the aggregate.
(7) A
contract between a preferred provider and an insurer may not contain any
financial incentives to a physician or a health care provider which act
directly or indirectly as an inducement to limit medically necessary services.
This subsection does not prohibit the savings from cost-effective utilization
of health services by contracting physicians or health care providers from
being shared with physicians or health care providers in the
aggregate.
(8) An insurer's
contract with a physician, physician group, or practitioner must have a
mechanism for the resolution of complaints initiated by an insured, a
physician, physician group, or practitioner. The mechanism must provide for
reasonable due process, including, in an advisory role only, a review panel
selected as specified in §
3.3706(b)(2) of
this title (relating to Designation as a Preferred Provider, Decision to
Withhold Designation, Termination of a Preferred Provider, Review of
Process).
(9) A contract between a
preferred provider and an insurer may not require any health care provider,
physician, or physician group to execute hold harmless clauses that shift an
insurer's tort liability resulting from acts or omissions of the insurer to the
preferred provider.
(10) A contract
between a preferred provider and an insurer must require a preferred provider
who is compensated by the insurer on a discounted fee basis to agree to bill
the insured only on the discounted fee and not the full charge.
(11) A contract between a preferred provider
and an insurer must require the insurer to comply with all applicable statutes
and rules pertaining to prompt payment of clean claims with respect to payment
to the provider for covered services rendered to insureds.
(12) A contract between a preferred provider
and an insurer must require the provider to comply with the Insurance Code
§§
1301.152 -
1301.154, which
relates to Continuity of Care.
(13)
A contract between a preferred provider and an insurer may not prohibit,
penalize, permit retaliation against, or terminate the provider for
communicating with any individual listed in Insurance Code §
1301.067, concerning
Interference with Relationship Between Patient and Physician or Health Care
Provider Prohibited, about any of the matters set forth in the
contract.
(14) A contract between a
preferred provider and an insurer conducting, using, or relying upon economic
profiling to terminate physicians or health care providers from a plan must
require the insurer to inform the provider of the insurer's obligation to
comply with Insurance Code §
1301.058, concerning
Economic Profiling.
(15) A contract
between a preferred provider and an insurer that engages in quality assessment
is required to disclose in the contract all requirements of Insurance Code
§
1301.059(b),
concerning Quality Assessment.
(16)
A contract between a preferred provider and an insurer may not require a
physician to issue an immunization or vaccination protocol for an immunization
or vaccination to be administered to an insured by a pharmacist.
(17) A contract between a preferred provider
and an insurer may not prohibit a pharmacist from administering immunizations
or vaccinations if they are administered in accordance with the Texas Pharmacy
Act, Chapters 551 - 566 and Chapters 568 - 569 of the Occupations Code, and
implementing rules.
(18) A contract
between a preferred provider and an insurer must require a provider that
voluntarily terminates the contract to provide reasonable notice to the
insured, and must require the insurer to provide assistance to the provider as
set forth in Insurance Code §
1301.160(b),
concerning Notification of Termination of Participation of Preferred
Provider.
(19) A contract between a
preferred provider and an insurer must require written notice to the provider
on termination of the contract by the insurer, and in the case of termination
of a contract between an insurer and a physician or practitioner, the notice
must include the provider's right to request a review, as specified in §
3.3706(d) of
this title.
(20) A contract between
a preferred provider and an insurer must include provisions that will entitle
the preferred provider upon request to all information necessary to determine
that the preferred provider is being compensated in accordance with the
contract. A preferred provider may make the request for information by any
reasonable and verifiable means. The information must include a level of detail
sufficient to enable a reasonable person with sufficient training, experience,
and competence in claims processing to determine the payment to be made
according to the terms of the contract for covered services that are rendered
to insureds. The insurer may provide the required information by any reasonable
method through which the preferred provider can access the information,
including email, computer disks, paper, or access to an electronic database.
Amendments, revisions, or substitutions of any information provided in
accordance with this paragraph are required to be made under subparagraph (D)
of this paragraph and, when applicable subparagraph (J) of this paragraph. The
insurer is required to provide the fee schedules and other required information
by the 30th day after the date the insurer receives the preferred provider's
request.
(A) This information is required to
include a preferred provider specific summary and explanation of all payment
and reimbursement methods that will be used to pay claims submitted by the
preferred provider. At a minimum, the information is required to include:
(i) a fee schedule, including, if applicable,
CPT, HCPCS, ICD-9-CM codes or successor codes, and modifiers:
(I) by which all claims for covered services
submitted by or on behalf of the preferred provider will be calculated and
paid; or
(II) that pertains to the
range of health care services reasonably expected to be delivered under the
contract by that preferred provider on a routine basis along with a toll-free
number or electronic address through which the preferred provider may request
the fee schedules applicable to any covered services that the preferred
provider intends to provide to an insured and any other information required by
this paragraph that pertains to the service for which the fee schedule is being
requested if that information has not previously been provided to the preferred
provider;
(ii) all
applicable coding methodologies;
(iii) all applicable bundling processes,
which are required to be consistent with nationally recognized and generally
accepted bundling edits and logic;
(iv) all applicable downcoding
policies;
(v) a description of any
other applicable policy or procedure the insurer may use that affects the
payment of specific claims submitted by or on behalf of the preferred provider,
including recoupment;
(vi) any
addenda, schedules, exhibits, or policies used by the insurer in carrying out
the payment of claims submitted by or on behalf of the preferred provider that
are necessary to provide a reasonable understanding of the information provided
under this paragraph; and
(vii) the
publisher, product name, and version of any software the insurer uses to
determine bundling and unbundling of claims.
(B) In the case of a reference to source
information as the basis for fee computation that is outside the control of the
insurer, such as state Medicaid or federal Medicare fee schedules, the
information provided by the insurer is required to clearly identify the source
and explain the procedure by which the preferred provider may readily access
the source electronically, telephonically, or as otherwise agreed to by the
parties.
(C) Nothing in this
paragraph may be construed to require an insurer to provide specific
information that would violate any applicable copyright law or licensing
agreement. However, the insurer is required to supply, in lieu of any
information withheld on the basis of copyright law or licensing agreement, a
summary of the information that will allow a reasonable person with sufficient
training, experience, and competence in claims processing to determine the
payment to be made according to the terms of the contract for covered services
that are rendered to insureds as required by subparagraph (A) of this
paragraph.
(D) No amendment,
revision, or substitution of claims payment procedures or any of the
information required to be provided by this paragraph will be effective as to
the preferred provider, unless the insurer provides at least 90 calendar days'
written notice to the preferred provider identifying with specificity the
amendment, revision, or substitution. An insurer may not make retroactive
changes to claims payment procedures or any of the information required to be
provided by this paragraph. Where a contract specifies mutual agreement of the
parties as the sole mechanism for requiring amendment, revision, or
substitution of the information required by this paragraph, the written notice
specified in this section does not supersede the requirement for mutual
agreement.
(E) Failure to comply
with this paragraph constitutes a violation as set forth in subsection (b) of
this section.
(F) This paragraph
applies to all contracts entered into or renewed on or after the effective date
of this paragraph. Upon receipt of a request, the insurer is required to
provide the information required by subparagraphs (A) - (D) of this paragraph
to the preferred provider by the 30th day after the date the insurer receives
the preferred provider's request.
(G) A preferred provider that receives
information under this paragraph:
(i) may not
use or disclose the information for any purpose other than:
(I) the preferred provider's practice
management;
(III) other business
operations; or
(IV) communications
with a governmental agency involved in the regulation of health care or
insurance;
(ii) may not
use this information to knowingly submit a claim for payment that does not
accurately represent the level, type, or amount of services that were actually
provided to an insured or to misrepresent any aspect of the services;
and
(iii) may not rely upon
information provided in accordance with this paragraph about a service as a
representation that an insured is covered for that service under the terms of
the insured's policy or certificate.
(H) A preferred provider that receives
information under this paragraph may terminate the contract on or before the
30th day after the date the preferred provider receives information requested
under this paragraph without penalty or discrimination in participation in
other health care products or plans. If a preferred provider chooses to
terminate the contract, the insurer is required to assist the preferred
provider in providing the notice required by paragraph (18) of this
subsection.
(I) The provisions of
this paragraph may not be waived, voided, or nullified by contract.
(J) No adverse material change to a preferred
provider contract will be effective as to the preferred provider unless the
adverse material change is made in accordance with Insurance Code §
1301.0642, concerning
Contract Provisions Allowing Certain Adverse Material Changes Prohibited, to
the extent applicable.
(21) An insurer may require a preferred
provider to retain in the preferred provider's records updated information
concerning a patient's other health benefit plan coverage.
(22) Upon request by a preferred provider, an
insurer is required to include a provision in the preferred provider's contract
providing that the insurer and the insurer's clearinghouse may not refuse to
process or pay an electronically submitted clean claim because the claim is
submitted together with or in a batch submission with a claim that is
deficient. As used in this section, the term "batch submission" is a group of
electronic claims submitted for processing at the same time within a HIPAA
standard ASC X12N 837 Transaction Set and identified by a batch control number.
This paragraph applies to a contract entered into or renewed on or after
January 1, 2006.
(23) A contract
between an insurer and a preferred provider other than an institutional
provider may contain a provision requiring a referring physician or provider,
or a designee, to disclose to the insured:
(A)
that the physician, provider, or facility to whom the insured is being referred
might not be a preferred provider; and
(B) if applicable, that the referring
physician or provider has an ownership interest in the facility to which the
insured is being referred.
(24) A contract provision that requires
notice as specified in paragraph (23)(A) of this subsection is required to
allow for exceptions for emergency care and as necessary to avoid interruption
or delay of medically necessary care and may not limit access to nonpreferred
providers.
(25) A contract between
an insurer and a preferred provider must require the preferred provider to
comply with all applicable requirements of Insurance Code §
1661.005, concerning
Refund of Overpayment.
(26) A
contract between an insurer and a facility must require that the facility give
notice to the insurer of the termination of a contract between the facility and
a facility-based physician or provider group that is a preferred provider for
the insurer as soon as reasonably practicable, but not later than the fifth
business day following termination of the contract.
(27) A contract between an insurer and a
preferred provider must require, except for instances of emergency care as
defined under Insurance Code §
1301.0053, concerning
Exclusive Provider Benefit Plans: Emergency Care and §1301.155(a),
concerning Emergency Care, that a physician or provider referring an insured to
a facility for surgery:
(A) notify the insured
of the possibility that out-of-network providers may provide treatment and that
the insured can contact the insurer for more information;
(B) notify the insurer that surgery has been
recommended; and
(C) notify the
insurer of the facility that has been recommended for the surgery.
(28) A contract between an insurer
and a facility must require, except for instances of emergency care as defined
under Insurance Code §
1301.0053 and §
1301.155(a),
that the facility, when scheduling surgery:
(A) notify the insured of the possibility
that out-of-network providers may provide treatment and that the insured can
contact the insurer for more information; and
(B) notify the insurer that surgery has been
scheduled.
(29) A
contract between an insurer and a preferred provider must comply with Insurance
Code §
1458.101, concerning
Contract Requirements, to the extent applicable.
(30) A contract between an insurer and a
preferred provider that is an optometrist or therapeutic optometrist must
comply with Insurance Code Chapter 1451, Subchapter D, concerning Access to
Optometrists Used Under Managed Care Plan.
(b) In addition to all other contract rights,
violations of these rules will be treated for purposes of complaint and action
in accordance with Insurance Code Chapter 542, Subchapter A, concerning Unfair
Claim Settlement Practices, and the provisions of that subchapter will be
employed to the extent practicable, as it relates to the power of the
department, hearings, orders, enforcement, and penalties.
(c) An insurer may enter into an agreement
with a preferred provider organization, an exclusive provider network, or a
health care collaborative for the purpose of offering a network of preferred
providers, provided that it remains the insurer's responsibility to:
(1) meet the requirements of Insurance Code
Chapter 1301, concerning Preferred Provider Benefit Plans, and this
subchapter;
(2) ensure that the
requirements of Insurance Code Chapter 1301 and this subchapter are met;
and
(3) provide all documentation
to demonstrate compliance with all applicable rules on request by the
department.