HBA-ATS C.S.H.B. 1764 76(R)BILL ANALYSIS
Office of House Bill AnalysisC.S.H.B. 1764
By: Farabee
Insurance
3/29/1999
Committee Report (Substituted)
BACKGROUND AND PURPOSE
On October 21, 1998, President Clinton signed the Women's Health and Cancer
Rights Act of 1998 (Act) into law as part of the Omnibus Appropriations Act
of 1998. The federal legislation governs most group health plans and
health maintenance organizations provided by private and governmental
employers. The Act requires that if an eligible participant or beneficiary
elects breast reconstruction in connection with a mastectomy, coverage must
be provided for: reconstruction of the breast on which mastectomy has been
performed, surgery on and reconstruction of the other breast to produce a
symmetrical appearance, prostheses, and treatment of physical
complications, including lymphedemas, at all stages of mastectomy.
Additionally, the law requires notice to be provided to each enrollee
regarding the coverage.
C.S.H.B. 1764 amends Article 21.53D, Insurance Code, and redesignates it as
Article 21.53I, to comply with these federal mandates. In addition, this
bill prohibits a health benefit plan from conditioning, limiting, or
denying the eligibility of an enrollee to enroll in the health benefit plan
or to renew coverage under the terms of the plan solely to avoid the
coverage requirements, and from reducing or limiting the reimbursement or
payment of, or otherwise penalizing, an attending physician or provider or
providing financial incentives or other benefits to an attending physician
or provider to induce the attending physician or provider to provide care
to an enrollee not permitted under Article 21.53I. This bill also adds a
reciprocal exchange insurance company to the types of organizations which
offer individual or group evidence of coverage subject to the requirements
of redesignated Article 21.53I, Insurance Code.
RULEMAKING AUTHORITY
It is the opinion of the Office of House Bill Analysis that rulemaking
authority previously delegated to the commissioner of insurance is modified
in SECTION 1 (Article 21.53I, Insurance Code) of this bill.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Article 21.53D, Insurance Code, as added by Chapter 84,
Acts of the 75th Legislature, Regular Session, 1997, by redesignating it as
Article 21.53I and amending it, as follows:
Art. 21.53I. COVERAGE FOR RECONSTRUCTIVE SURGERY AFTER MASTECTOMY
Sec. 1. DEFINITIONS. Adds the definition of "enrollee."
Sec. 2. SCOPE OF ARTICLE. (a) Includes a similar coverage document
offered by an enumerated list of organizations among the types of documents
that evidence coverage provided under a health benefit plan to which only
Article 21.53I applies. Adds a reciprocal exchange operating under Chapter
19 (Reciprocal Exchanges) to the types of organizations that offer
individual or group evidence of coverage subject to the requirements of
Article 21.53I. Makes nonsubstantive and conforming changes.
(b) Sets forth that a plan that provides coverage only for a specific
disease or other limited benefit except for cancer is not governed by this
article. Sets forth that a plan that provides coverage only for wages or
payments in lieu of wages for a period during which an employee is absent
from work because of sickness or injury is not governed by this article.
Sets forth that a plan that provides coverage only for indemnity for
hospital confinement, rather than indemnity coverage only, is not governed
by this article. Sets forth that a plan that provides coverage only for
credit insurance is not governed by this article. Sets forth that a plan
that provides coverage only for hospital expenses, rather than for
specified accident, hospital indemnity, or other limited benefits health
insurance policies, is not governed by this article. Removes small
employer plans written under Chapter 26 (Health Insurance Availability)
from the types of plans not governed by this article. Makes conforming and
nonsubstantive changes.
Sec. 3. COVERAGE REQUIRED. (a) Provides that a health benefit plan that
provides coverage for mastectomy must provide coverage for reconstruction
of the breast on which the mastectomy has been performed, surgery and
reconstruction of the other breast to achieve a symmetrical appearance, and
prostheses and treatment of physical complications, including lymphedemas,
at all stages of mastectomy.
(b) Requires the coverage described in this section to be provided in the
manner determined to be appropriate in consultation with the attending
physician and the enrollee.
(c) Authorizes the coverage described in this section to be subject to
deductibles, copayments, and coinsurance provisions that are consistent
with deductibles, copayments, and coinsurance required for analogous
benefits under the health benefit plan.
(d) Prohibits the benefits required by this subchapter from being subject
to dollar limitations other than the health benefit plan's lifetime maximum
benefits. Deletes the provision authorizing the coverage to be subject to
the same deductible or copayment applicable to mastectomy.
Sec. 4. PROHIBITIONS. (a) Prohibits a health benefit plan from
conditioning, limiting, or denying the eligibility of an enrollee to enroll
in the health benefit plan or to renew coverage under the terms of the plan
solely for the purpose of avoiding the requirements of this article.
Prohibits a health benefit plan from reducing or limiting the reimbursement
or payment of, or otherwise penalizing, an attending physician or provider
or providing financial incentives or other benefits to an attending
physician or provider to induce the attending physician or provider to
provide care to an enrollee in a manner inconsistent with this article.
(b) Adds this subsection to prohibit the construction of this section to
prevent a health benefit plan from negotiating with a physician or provider
the level and type of reimbursement that physician or provider will receive
for care provided in accordance with this article.
Sec. 5. NOTICE. Adds this section to require a health benefit plan that
provides coverage under this article to give notice of the availability of
that coverage to each enrollee in accordance with rules adopted by the
commissioner of insurance (commissioner).
Sec. 6. SEVERABILITY. Severability clause.
Sec. 7. RULES. Authorizes the commissioner to adopt rules to implement
this article and to meet the minimum requirements of federal law.
SECTION 2. Effective date: September 1, 1999.
Makes application of this Act prospective for a health benefit
plan that is delivered, issued for delivery, or renewed, on or
after January 1, 2000.
SECTION 3. Emergency clause.
COMPARISON OF ORIGINAL TO SUBSTITUTE
C.S.H.B. 1764 modifies the original bill in SECTION 1 by redesignating
Article 21.53D (Coverage for Reconstructive Surgery After Mastectomy),
Insurance Code as Article 21.53I, Insurance Code.
The substitute also modifies the original bill in SECTION 1 by changing the
proposed definition of "enrollee." As modified by the substitute, an
"enrollee" is a person entitled to coverage under a health benefit plan.
Under the original bill, an "enrollee" means an individual enrolled in a
health benefit plan including covered dependents.
The substitute modifies the original bill in SECTION 1 by including a
similar coverage document offered by an enumerated list of organizations
among the types of documents that evidence coverage provided under a health
benefit plan to which only Article 21.53I applies, rather than to which
Article 21.53I applies.
The substitute modifies the original bill in SECTION 1 by redesignating
proposed Subdivision (6) to proposed Subdivision (5) in Section (2)(a),
which concerns the proposed addition of a reciprocal exchange operating
under Chapter 19 (Reciprocal Exchanges) to the types of organizations that
offer individual or group evidence of coverage subject to the requirements
of Article 21.53I.
The substitute modifies the original bill in SECTION 1 by setting forth
that a plan that provides coverage only for a specific disease or other
limited benefit, rather than limited benefit, except for cancer, is not
governed by Article 21.53I.
The substitute modifies the original bill by switching the proposed text in
Paragraphs (D) and (G), and by specifying that this Article does not apply
to a Medicare supplemental policy as defined by Section 1882(j)(1), Social
Security Act (42 U.S.C. Section 1395ss), as amended.
The substitute modifies the original bill in SECTION 1 by modifying the
proposed addition in proposed Subsection (a) of Section 3 that a health
benefit plan that provides coverage for mastectomy must provide it for
prostheses and physical complications at all stages of mastectomy including
lymphedemas, among other requirements, to require coverage for prostheses
and treatment of physical complications, including lymphedemas, at all
stages of mastectomy.
The substitute modifies the original bill in SECTION 1 by striking the term
"annual" when referring to deductibles, copayments, and coinsurance
provisions in the proposed addition of Subsection (c) to Section 3 of
Article 21.53I. The substitute modifies the original bill by providing
that deductibles, copayments, and coinsurance be consistent with those
required for analogous, rather than established for other, benefits under
the health benefit plan.
The substitute modifies the original bill in SECTION 1 by changing proposed
Subsection (a) of Section 4 to reinstate the proposed deletion of a
prohibition against a heath insurer offering a financial incentive for a
patient to forego breast reconstruction or to waive the coverage required
by Section 3, Article 21.53I.
The substitute also modifies the original bill by modifying the proposed
addition in proposed Subdivision (1) of Section 4(a) of a prohibition
against conditioning, limiting, or denying eligibility to be covered under
a health benefit plan. As modified, the proposed addition prohibits a
health benefit plan from conditioning, limiting, or denying the eligibility
of an enrollee to enroll in the health benefit plan or to renew coverage
under the terms of the plan solely for the purpose of avoiding the
requirements of Article 21.53I. Under the original bill, the proposed
prohibition would have prohibited a health benefit plan from conditioning,
limiting, or denying eligibility or continued eligibility to an enrollee,
to enroll or to renew coverage under the terms of the health benefit plan,
solely for the purpose of avoiding the requirements of Article 21.53I.
The substitute also modifies the original bill by deleting the proposed
prohibition in proposed Subdivision (2) of Section (4)(a) against a health
benefit plan from providing monetary payments or rebates to individuals to
encourage enrollees to accept less than the minimum protections required
under Article 21.53I.
The substitute also modifies the original bill by modifying two proposed
prohibitions to combine their provisions in proposed Subdivisions (3) and
(4) of Section 4(a) into one single prohibition. Under the original bill,
one provision prohibited a health benefit plan from penalizing or otherwise
reducing or limiting the reimbursement or payment of an attending physician
or provider because such attending physician or provider provided care to
an enrollee in accordance with Article 21.53I. The other provision
prohibited a health benefit plan from providing financial incentives or
other benefits to an attending physician or provider to induce such
attending physician or provider to provide care to an enrollee in a manner
inconsistent with Article 21.53I. Under the substitute, a health benefit
plan is prohibited from reducing or limiting the reimbursement or payment
of, or otherwise penalizing, an attending physician or provider or
providing financial incentives or other benefits to an attending physician
or provider to induce the attending physician or provider to provide care
to an enrollee in a manner inconsistent with Article 21.53I.
The substitute modifies the original bill in SECTION 1 by making
nonsubstantive changes.
C.S.H.B. 1764 modifies the original bill in SECTIONS 2 and 3 by changing
the effective date from 90 days after adjournment to September 1, 1999.
The substitute also modifies the original by making application of this Act
prospective for a health benefit plan that is delivered, issued for
delivery, or renewed, on or after January 1, 2000. Under the original
bill, this Act was required to apply to health benefit plans currently in
effect and to those issued or delivered on or after the date of enactment.