89R27021 SCF-F     By: Bonnen, Oliverson, Jones of Dallas, H.B. No. 3812       et al.     Substitute the following for H.B. No. 3812:     By:  Dean C.S.H.B. No. 3812       A BILL TO BE ENTITLED   AN ACT   relating to health benefit plan preauthorization requirements for   certain health care services and the direction of utilization   review by physicians.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 4201.152, Insurance Code, is amended to   read as follows:          Sec. 4201.152.  UTILIZATION REVIEW UNDER DIRECTION OF   PHYSICIAN.  A utilization review agent shall conduct utilization   review under the direction of a physician licensed to practice   medicine in this state.  The physician may not hold a license to   practice administrative medicine under Section 155.009,   Occupations Code.          SECTION 2.  Section 4201.651(a), Insurance Code, is amended   to read as follows:          (a)  In this subchapter:                (1)  "Affiliate" has the meaning assigned by Section   823.003.                (2)  "Preauthorization"[, "preauthorization"] means a   determination by a health maintenance organization, insurer, or   person contracting with a health maintenance organization or   insurer that health care services proposed to be provided to a   patient are medically necessary and appropriate.          SECTION 3.  Section 4201.653, Insurance Code, is amended by   amending Subsections (a) and (b) and adding Subsection (a-1) to   read as follows:          (a)  A health maintenance organization or an insurer that   uses a preauthorization process for health care services may not   require a physician or provider to obtain preauthorization for a   particular health care service if, in the most recent one-year   [six-month] evaluation period, as described by Subsection (b):                (1)  [,] the health maintenance organization or   insurer, including any affiliate, has approved or would have   approved not less than 90 percent of the preauthorization requests   submitted by the physician or provider for the particular health   care service; and                (2)  the physician or provider has provided the   particular health care service at least five times during the   evaluation period.          (a-1)  In conducting an evaluation for an exemption under   this section, a health maintenance organization or insurer must   include all preauthorization requests submitted by a physician or   provider to the health maintenance organization or insurer, or its   affiliate, considering all health insurance policies and health   benefit plans issued or administered by the health maintenance   organization or insurer, or its affiliate, regardless of whether   the preauthorization request was made in connection with a health   insurance policy or health benefit plan that is subject to this   subchapter.          (b)  Except as provided by Subsection (c), a health   maintenance organization or insurer shall evaluate whether a   physician or provider qualifies for an exemption from   preauthorization requirements under Subsection (a) once every year   [six months].          SECTION 4.  Section 4201.655, Insurance Code, is amended by   amending Subsections (a) and (b) and adding Subsection (b-1) to   read as follows:          (a)  A health maintenance organization or insurer may   rescind an exemption from preauthorization requirements under   Section 4201.653 only:                (1)  during January [or June] of a [each] year   beginning on or after the first anniversary of the last day of the   most recent evaluation period for the exemption;                (2)  if the health maintenance organization or insurer   makes a determination, on the basis of a retrospective review of a   random sample of not fewer than five and no more than 20 claims   submitted by the physician or provider during the most recent   evaluation period described by Section 4201.653(b), that less than   90 percent of the claims for the particular health care service met   the medical necessity criteria that would have been used by the   health maintenance organization or insurer when conducting   preauthorization review for the particular health care service   during the relevant evaluation period; and                (3)  if the health maintenance organization or insurer   complies with other applicable requirements specified in this   section, including:                      (A)  notifying the physician or provider not less   than 25 days before the proposed rescission is to take effect; and                      (B)  providing with the notice under Paragraph   (A):                            (i)  the sample information used to make the   determination under Subdivision (2); and                            (ii)  a plain language explanation of how   the physician or provider may appeal and seek an independent review   of the determination.          (b)  A determination made under Subsection (a)(2) must be   made by an individual licensed to practice medicine in this state.     For a determination made under Subsection (a)(2) with respect to a   physician, the determination must be made by an individual licensed   to practice medicine in this state who has the same or similar   specialty as that physician.  The reviewing physician may not hold a   license to practice administrative medicine under Section 155.009,   Occupations Code.          (b-1)  Notwithstanding Subsection (a)(2), if there are fewer   than five claims submitted by the physician or provider during the   most recent evaluation period described by Section 4201.653(b) for   a particular health care service, the health maintenance   organization or insurer shall review all the claims submitted by   the physician or provider during the most recent evaluation period   for that service.          SECTION 5.  Section 4201.656(a), Insurance Code, is amended   to read as follows:          (a)  A physician or provider has a right to a review of an   adverse determination regarding a preauthorization exemption,   including a health maintenance organization's or insurer's   determination to deny an exemption to the physician or provider   under Section 4201.653, to be conducted by an independent review   organization.  A health maintenance organization or insurer may not   require a physician or provider to engage in an internal appeal   process before requesting a review by an independent review   organization under this section.          SECTION 6.  Section 4201.658, Insurance Code, is amended to   read as follows:          Sec. 4201.658.  ELIGIBILITY FOR PREAUTHORIZATION EXEMPTION   FOLLOWING FINALIZED EXEMPTION RESCISSION OR DENIAL. After a final   determination or review affirming the rescission or denial of an   exemption for a specific health care service under Section   4201.653, a physician or provider is eligible for consideration of   an exemption for the same health care service after the one-year   [six-month] evaluation period that follows the evaluation period   which formed the basis of the rescission or denial of an exemption.          SECTION 7.  Sections 4201.659(b) and (c), Insurance Code,   are amended to read as follows:          (b)  Regardless of whether an exemption is rescinded after   the provision of a health care service subject to the exemption, a   [A] health maintenance organization or an insurer may not conduct a   utilization [retrospective] review or require another review   similar to preauthorization of the [a health care] service [subject   to an exemption] except:                (1)  to determine if the physician or provider still   qualifies for an exemption under this subchapter; or                (2)  if the health maintenance organization or insurer   has a reasonable cause to suspect a basis for denial exists under   Subsection (a).          (c)  For a utilization [retrospective] review described by   Subsection (b)(2), nothing in this subchapter may be construed to   modify or otherwise affect:                (1)  the requirements under or application of Section   4201.305, including any timeframes specified by that section; or                (2)  any other applicable law, except to prescribe the   only circumstances under which:                      (A)  a [retrospective] utilization review may   occur as specified by Subsection (b)(2); or                      (B)  payment may be denied or reduced as specified   by Subsection (a).          SECTION 8.  Subchapter N, Chapter 4201, Insurance Code, is   amended by adding Section 4201.660 to read as follows:          Sec. 4201.660.  REPORT. (a) Each health maintenance   organization and insurer shall submit to the department, in the   form and manner prescribed by the commissioner, an annual written   report, for each health care service subject to an exemption under   Section 4201.653, on the:                (1)  exemptions granted by the health maintenance   organization or insurer for the service;                (2)  determinations by the health maintenance   organization or insurer to rescind or deny an exemption for the   service, including the number of exemptions denied or rescinded by   the health maintenance organization or insurer under Section   4201.655; and                (3)  independent reviews of determinations conducted   by an independent review organization under Section 4201.656,   including:                      (A)  the number of determinations made by the   health maintenance organization or insurer for which a physician or   provider requested an independent review under Section 4201.656;   and                      (B)  the outcome of each independent review   described by Paragraph (A).          (b)  Subject to this subsection, a report submitted under   Subsection (a) is public information subject to disclosure under   Chapter 552, Government Code. The department shall ensure that the   report does not contain any identifying information before   disclosing the report in accordance with Chapter 552, Government   Code.          SECTION 9.  (a) The change in law made by this Act applies   only to utilization review conducted on or after the effective date   of this Act. Utilization review conducted before the effective date   of this Act is governed by the law as it existed immediately before   the effective date of this Act, and that law is continued in effect   for that purpose.          (b)  A preauthorization exemption provided under Section   4201.653, Insurance Code, before the effective date of this Act may   not be rescinded before the first anniversary of the last day of the   most recent evaluation period for the exemption.          SECTION 10.  This Act takes effect September 1, 2025.