HBA-ATS S.B. 1084 76(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 1084
By: Harris
Insurance
5/21/1999
Engrossed



BACKGROUND AND PURPOSE 

Article 3.51-6(3) (Payment of Benefits), Insurance Code, addresses the
assignment of benefits under any group or blanket accident sickness policy.
All benefits are required to be payable to the insured, or to the insured's
designated beneficiary or beneficiaries, or to the insured's estate, except
that in the case of an insured minor, such benefits may be made payable to
the minor's parent, guardian, or other person actually supporting the
minor.  The statute does authorize the policy to provide that all or a
portion of any indemnities provided by any such policy on account of
hospital, nursing, medical, or surgical services may, at the option of the
insurer and unless the insured requests otherwise in writing not later than
the time of filing proofs of such loss, be paid directly to the hospital or
person rendering such services, however.   Such a payment discharges the
obligation of the insurer with respect to the amount of insurance paid. 

Because the statute applies only to medical services, the exclusion of
dental services may create a problem for an insured in situations in which
the insurance plan permits a patient to go outside the network but does not
assign the benefits to the patient's dentist.  Consequently, a  patient
must pay out-of-pocket and be reimbursed by the patient's insurer.  S.B.
1084 requires any group or blanket accident sickness policy to provide that
all or a portion of any benefits provided by any such policy for dental
care services may, at the option of the insured, be assigned to the dentist
providing such services.  In the case of such assignment, the payment is
required to be made directly to the dentist designated.  A payment made
pursuant to such assignment discharges the obligation of the insurer with
respect to the amount of insurance so paid.  The policy is prohibited from
requiring that a covered service be rendered by a particular hospital or
person. 

In addition, this bill deletes text prohibiting any group or blanket
accident and sickness policy from requiring that a medical service be
rendered by a particular hospital or person, and redefines "health
insurance policy" and "employee benefit plan." 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Article 21.53(1), Insurance Code, to redefine "health
insurance policy"  by deleting the provision that the policy provides
benefits for dental care expenses incurred as a result of an accident or
sickness and by specifying that the plan provides benefits for dental care
services. Redefines "employee benefit plan" by deleting the provision that
the plan provides dental care benefits in the event of an accident or
sickness and by specifying that the plan provides benefits for dental care
services. 

SECTION 2.  Amends Article 21.53(3), Insurance Code, to require any health
insurance policy (policy) or employee benefit plan (plan) to provide that
the party to or beneficiary of the policy or plan is authorized to assign
the right to benefits to the dentist who provides the dental care services,
in which case, benefits are required to be paid directly to the dentist
designated.  Provides that a payment made pursuant to this subsection
discharges the payor's obligation to pay those benefits. Makes conforming
changes. 
 
SECTION 3.  Amends Article 3.51-6(3), Insurance Code, by deleting text
prohibiting any group or blanket accident and sickness policy from
requiring that certain services be rendered by a particular hospital or
person, and by adding an exception to the requirement that all benefits
under any group or blanket accident and sickness policy be payable to the
person insured, or to the designated beneficiary or beneficiaries, or
estate.  The exception requires any such policy to provide that all or a
portion of any benefits provided by any such policy for dental care
services may, at the option of the insured, be assigned to the dentist
providing such services; requires the payment to be made directly to the
dentist designated, in the case of such assignment; requires a payment made
pursuant to such assignment to discharge the obligation of the insurer with
respect to the amount of insurance so paid; and prohibits the policy from
requiring that a covered service be rendered by a particular hospital or
person.  Makes a conforming change. 

SECTION 4.Emergency clause.
  Effective date: upon passage.