March 07, 2019

Texas Lawmakers Focus on Out-of-Network Billing

Two bills under consideration in the Texas Senate and House of Representatives seek to shield patients from balance billing by out-of-network providers and establish an independent dispute resolution program to address disagreements about out-of-network charges. The details of the two proposals vary significantly and some of the provisions may create new challenges for the provider community.

TX SB 1264

State Sen. Kelly Hancock (R), and Rep. Trey Martinez Fischer (D), filed a measure that seeks to modify existing Texas statute to ban balance billing by out-of-network providers and to strike out language on enrollees being a party to existing mediation provisions.

The bill would still allow mediation between providers and insurers for disputes over $500. The bill does not stipulate particular benchmarking for reimbursement but instead strips the existing “usual and customary rate” language in favor of “an amount that the organization determines is reasonable.”

TX HB 2967

A bill sponsored by Republican Rep. Tom Oliverson would ban balance billing by out-of-network providers and seeks to create an independent resolution dispute (IDR) process. The IDR process would take into account the usual, customary, and reasonable rate.

"Usual, customary, and reasonable rate" is defined as “the 80th percentile of all charges for a particular health care service performed by a health care provider in the same or similar specialty and provided in the same geographical area as reported in a benchmarking database, described by Section 1467.203.”

Section 1467.203 of the suggested measure directs the commissioner to select a nonprofit organization to maintain a benchmarking database that contains information necessary to calculate the usual, customary, and reasonable rate for each geographical area in this state that and is not financially affiliated with a health benefit plan issuer.