By: Hancock, Blanco	S.B. No. 926

	A BILL TO BE ENTITLED
	AN ACT
	relating to certain practices of health benefit plan issuers to
	encourage the use of certain physicians and health care providers
	and rank physicians.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Subchapter I, Chapter 843, Insurance Code, is
	amended by adding Section 843.322 to read as follows:
	Sec. 843.322.  INCENTIVES TO USE CERTAIN PHYSICIANS OR
	PROVIDERS. (a)  A health maintenance organization may provide
	incentives for enrollees to use certain physicians or providers
	through modified deductibles, copayments, coinsurance, or other
	cost-sharing provisions.
	(b)  A health maintenance organization that encourages an
	enrollee to obtain a health care service from a particular
	physician or provider, including offering incentives to encourage
	enrollees to use specific physicians or providers, or that
	introduces or modifies a tiered network plan or assigns physicians
	or providers into tiers, has a fiduciary duty to the enrollee or
	group contract holder to engage in that conduct only for the primary
	benefit of the enrollee or group contract holder.
	(c)  A health maintenance organization violates the
	fiduciary duty described by Subsection (b) by offering incentives
	to encourage enrollees to use a particular physician or provider
	solely because the physician or provider directly or indirectly
	through one or more intermediaries controls, is controlled by, or
	is under common control with the health maintenance organization.
	(d)  Conduct that violates the fiduciary duty described by
	Subsection (b) includes:
	(1)  using a steering approach or a tiered network to
	provide a financial incentive as an inducement to limit medically
	necessary services, encourage receipt of lower quality medically
	necessary services, or violate state or federal law;
	(2)  failing to implement reasonable procedures to
	ensure that:
	(A)  participating providers that enrollees are
	encouraged to use within any steering approach or tiered network
	are not of materially lower quality than participating providers
	that enrollees are not encouraged to use; and
	(B)  the health maintenance organization does not
	make materially false statements or representations about a
	physician's or provider's quality of care or costs; and
	(3)  failing to use objective, verifiable, and accurate
	information as the basis of any encouragement or incentive under
	this section.
	(e)  An encouragement or incentive authorized by this
	section may not:
	(1)  be based solely on cost; or
	(2)  impose a cost-sharing requirement for
	out-of-network emergency services that is greater than the
	cost-sharing requirement that would apply had the services been
	furnished by a participating provider.
	(f)  This section does not apply to a vision care plan, as
	defined by Section 1451.157.
	SECTION 2.  Section 1301.0045(a), Insurance Code, is amended
	to read as follows:
	(a)  Except as provided by Sections [Section] 1301.0046 and
	1301.0047, this chapter may not be construed to limit the level of
	reimbursement or the level of coverage, including deductibles,
	copayments, coinsurance, or other cost-sharing provisions, that
	are applicable to preferred providers or, for plans other than
	exclusive provider benefit plans, nonpreferred providers.
	SECTION 3.  Subchapter A, Chapter 1301, Insurance Code, is
	amended by adding Section 1301.0047 to read as follows:
	Sec. 1301.0047.  INCENTIVES TO USE CERTAIN PHYSICIANS OR
	HEALTH CARE PROVIDERS. (a)  An insurer may provide incentives for
	insureds to use certain physicians or health care providers through
	modified deductibles, copayments, coinsurance, or other
	cost-sharing provisions.
	(b)  An insurer that encourages an insured to obtain a health
	care service from a particular physician or health care provider,
	including offering incentives to encourage insureds to use specific
	physicians or providers, or that introduces or modifies a tiered
	network plan or assigns physicians or providers into tiers, has a
	fiduciary duty to the insured or policyholder to engage in that
	conduct only for the primary benefit of the insured or
	policyholder.
	(c)  An insurer violates the fiduciary duty described by
	Subsection (b) by offering incentives to encourage insureds to use
	a particular physician or health care provider solely because the
	physician or provider directly or indirectly through one or more
	intermediaries controls, is controlled by, or is under common
	control with the insurer.
	(d)  Conduct that violates the fiduciary duty described by
	Subsection (b) includes:
	(1)  using a steering approach or a tiered network to
	provide a financial incentive as an inducement to limit medically
	necessary services, encourage receipt of lower quality medically
	necessary services, or violate state or federal law;
	(2)  failing to implement reasonable procedures to
	ensure that:
	(A)  preferred providers that insureds are
	encouraged to use within any steering approach or tiered network
	are not of materially lower quality than preferred providers that
	insureds are not encouraged to use; and
	(B)  the insurer does not make materially false
	statements or representations about a physician's or health care
	provider's quality of care or costs; and
	(3)  failing to use objective, verifiable, and accurate
	information as the basis of any encouragement or incentive under
	this section.
	(e)  An encouragement or incentive authorized by this
	section may not:
	(1)  be based solely on cost; or
	(2)  impose a cost-sharing requirement for
	out-of-network emergency services that is greater than the
	cost-sharing requirement that would apply had the services been
	furnished by a preferred provider.
	(f)  This section does not apply to a vision care plan, as
	defined by Section 1451.157.
	SECTION 4.  Section 1460.003, Insurance Code, is amended by
	amending Subsection (a) and adding Subsection (a-1) to read as
	follows:
	(a)  A health benefit plan issuer, including a subsidiary or
	affiliate, may not rank physicians or[,] classify physicians into
	tiers based on performance[, or publish physician-specific
	information that includes rankings, tiers, ratings, or other
	comparisons of a physician's performance against standards,
	measures, or other physicians,] unless:
	(1)  the standards used by the health benefit plan
	issuer to rank or classify are developed or prescribed by an
	organization designated by the commissioner through rules adopted
	under Section 1460.005;
	(2)  the ranking or classification and any methodology
	used to rank or classify:
	(A)  is disclosed to each affected physician at
	least 45 days before the date the ranking or classification is
	released, published, or distributed by the health benefit plan
	issuer; and
	(B)  identifies which products or networks
	offered by the health benefit plan issuer the ranking or
	classification will be used for; and
	(3)  each affected physician is given an easy-to-use
	process to identify:
	(A)  before the release, publication, or
	distribution of the ranking or classification, any discrepancy
	between the standards and the ranking or classification proposed by
	the health benefit plan issuer; and
	(B)  after the release, publication, or
	distribution of the ranking or classification, any objectively and
	verifiably false information contained in the ranking or
	classification [the standards used by the health benefit plan
	issuer conform to nationally recognized standards and guidelines as
	required by rules adopted under Section 1460.005;
	[(2)  the standards and measurements to be used by the
	health benefit plan issuer are disclosed to each affected physician
	before any evaluation period used by the health benefit plan
	issuer; and
	[(3)  each affected physician is afforded, before any
	publication or other public dissemination, an opportunity to
	dispute the ranking or classification through a process that, at a
	minimum, includes due process protections that conform to the
	following protections:
	[(A)  the health benefit plan issuer provides at
	least 45 days' written notice to the physician of the proposed
	rating, ranking, tiering, or comparison, including the
	methodologies, data, and all other information utilized by the
	health benefit plan issuer in its rating, tiering, ranking, or
	comparison decision;
	[(B)  in addition to any written fair
	reconsideration process, the health benefit plan issuer, upon a
	request for review that is made within 30 days of receiving the
	notice under Paragraph (A), provides a fair reconsideration
	proceeding, at the physician's option:
	[(i)  by teleconference, at an agreed upon
	time; or
	[(ii)  in person, at an agreed upon time or
	between the hours of 8:00 a.m. and 5:00 p.m. Monday through Friday;
	[(C)  the physician has the right to provide
	information at a requested fair reconsideration proceeding for
	determination by a decision-maker, have a representative
	participate in the fair reconsideration proceeding, and submit a
	written statement at the conclusion of the fair reconsideration
	proceeding; and
	[(D)  the health benefit plan issuer provides a
	written communication of the outcome of a fair reconsideration
	proceeding prior to any publication or dissemination of the rating,
	ranking, tiering, or comparison.  The written communication must
	include the specific reasons for the final decision].
	(a-1)  If a physician submits information under Subsection
	(a)(3) sufficient to establish a verifiable discrepancy or
	objectively and verifiably false information contained in the
	ranking or classification or a violation of this chapter, the
	health benefit plan issuer must remedy the discrepancy, false
	information, or violation by the later of:
	(1)  the release, publication, or distribution of the
	ranking or classification; or
	(2)  the 30th day after the date the health benefit plan
	issuer receives the information.
	SECTION 5.  Section 1460.005, Insurance Code, is amended by
	amending Subsection (c) and adding Subsection (d) to read as
	follows:
	(c)  In adopting rules under this section for purposes of
	Section 1460.003(a)(1), the commissioner may only designate an
	organization that meets the following requirements:
	(1)  the organization is:
	(A)  a national medical specialty society; or
	(B)  a bona fide organization that is unbiased
	toward or against any medical provider or health benefit plan
	issuer; and
	(2)  the standards developed or prescribed by the
	organization that are to be used in rankings or classifications:
	(A)  emphasize quality of care and:
	(i)  are nationally recognized, in widely
	circulated peer-reviewed medical literature, expert-based
	physician consensus quality standards, or leading objective
	clinical evidence-based scholarship;
	(ii)  have a publicly transparent
	methodology; and
	(iii)  if based on clinical outcomes, are
	risk-adjusted; and
	(B)  are compatible with an easy-to-use process in
	which a physician or person acting on behalf of the physician may
	report data, evidentiary, factual, or mathematical discrepancies,
	errors, omissions, or faulty assumptions for investigation and, if
	appropriate, correction [shall consider the standards, guidelines,
	and measures prescribed by nationally recognized organizations
	that establish or promote guidelines and performance measures
	emphasizing quality of health care, including the National Quality
	Forum and the AQA Alliance.  If neither the National Quality Forum
	nor the AQA Alliance has established standards or guidelines
	regarding an issue, the commissioner shall consider the standards,
	guidelines, and measures prescribed by the National Committee on
	Quality Assurance and other similar national organizations.  If
	neither the National Quality Forum, nor the AQA Alliance, nor other
	national organizations have established standards or guidelines
	regarding an issue, the commissioner shall consider standards,
	guidelines, and measures based on other bona fide nationally
	recognized guidelines, expert-based physician consensus quality
	standards, or leading objective clinical evidence and
	scholarship].
	(d)  In this section, "national medical specialty society"
	means a national organization:
	(1)  with a majority of members who are physicians;
	(2)  that represents a specific physician medical
	specialty; and
	(3)  that is represented in the house of delegates of
	the American Medical Association.
	SECTION 6.  Section 1460.007, Insurance Code, is amended by
	adding Subsection (c) to read as follows:
	(c)  The commissioner shall prohibit a health benefit plan
	issuer from using a ranking or classification system otherwise
	authorized under this chapter for not less than 12 consecutive
	months if the commissioner determines that the health benefit plan
	issuer has engaged in a pattern of discrepancies, falsehoods, or
	violations described by Section 1460.003(a-1).
	SECTION 7.  This Act takes effect September 1, 2025.