1. INTRODUCTION. The Commissioner of Insurance adopts new §21.4601 - §21.4605, concerning the requirements for health benefit plan issuers' submission of information and data relating to the use of non-network providers by health benefit plan insureds and enrollees and the payments made to those providers, as well as similar information and data for in-network providers, necessary to support the study of facility-based provider network adequacy of health benefit plans by the Advisory Committee on Health Network Adequacy. Sections 21.4602 - 21.4605 are adopted with changes to the proposed text published in the October 3, 2008 issue of the Texas Register (33 TexReg 8281). Section 21.4601 is adopted without changes. Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) are adopted by reference without changes to either form as proposed.
2. REASONED JUSTIFICATION. The new subchapter is necessary to implement Section 20 of Senate Bill (SB) 1731, as enacted by the 80th Legislature, Regular Session, effective September 1, 2007. The new subchapter is also necessary to facilitate the study of network adequacy by the Advisory Committee on Health Network Adequacy (Advisory Committee). SB 1731 enacts new Insurance Code §1456.0065, which requires the Commissioner of Insurance to establish an advisory committee to study the facility-based provider network adequacy of health benefit plans. Pursuant to SB 1731, Section 20, the Commissioner must require by rule that each health benefit plan issuer subject to Insurance Code Chapter 1456 submit information to the Department concerning the use of non-network providers by health benefit plan insureds and enrollees and the payments made to those providers. The adopted sections implement the information and data collection requirement in SB 1731, Section 20, and facilitate the study of health network adequacy mandated by the Insurance Code §1456.0065.
In accordance with the Insurance Code §1456.0065, the Commissioner appointed the Advisory Committee to study facility-based provider network adequacy. The Commissioner finalized the appointments on November 28, 2007, in Commissioner's Order No. 07-1062. The Advisory Committee membership includes physician representatives; hospital representatives; health benefit plan representatives; and association representatives representing physicians, hospitals, and health benefit plans. This membership accords with the membership requirements mandated in the Insurance Code §1456.0065. The Advisory Committee has thus far met on December 10, 2007; January 24, 2008; February 26, 2008; April 17, 2008; May 22, 2008; August 13, 2008; and November 14, 2008. The adopted sections incorporate the guidance provided by the Advisory Committee members. Additionally, consistent with the Insurance Code §1212.002(b), the Department apprised the Technical Advisory Committee on Claims Processing of progress regarding the proposal for this subchapter during that committee's July 30, 2008 meeting. The Department also invited comment from members of the Technical Advisory Committee on Claims Processing. The Technical Advisory Committee on Claims Processing is appointed by the Commissioner pursuant to the Insurance Code §1212.001. Pursuant to §1212.002(a) of the Insurance Code, the committee is to advise the Commissioner on technical aspects of coding of health care services and claims development, submission, processing, adjudication, and payment, as well as the impact on those processes of contractual requirements and relationships, including relationships among employers, health benefit plans, insurers, health maintenance organizations, preferred provider organizations, electronic clearinghouses, physicians and other health care providers, third-party administrators, independent physician associations, and medical groups. Section 1212.002(b) of the Insurance Code requires the Commissioner to consult with the technical advisory committee before adopting any rule related to the subjects described by §1212.002(a).
On July 11, 2008, the Department posted an informal draft proposal of Subchapter LL on its website and invited public comment. On October 3, 2008, the proposed new subchapter was published in the Texas Register. The Department held a public hearing on the rule proposal on October 14, 2008. The Department received both written comments on the published proposal and oral comments at the public hearing. In response to comments, the Department has changed some of the proposed language in the text of the rule as adopted. The Department has also made non-substantive editorial changes necessary for clarification and enhancement of the user-friendliness of the rule. None of the changes made to the proposed text, either as a result of comments or as a result of necessary clarification, materially alter issues raised in the proposal, introduce new subject matter, or affect persons other than those previously on notice.
One change has been made to the proposed text as a result of comments. Section 21.4604(a) as adopted is changed to provide that the information and data as required in this subchapter must be submitted to the Department by no later than February 27, 2009. The proposal required that the information and data be submitted on or before January 9, 2009. One commenter objected to the proposed January 9, 2009 deadline and proposed an alternative submission deadline of 60 days after adoption of the final rule. While the proposed January 9 submission deadline is no longer viable due to the effective date of this adoption, the Department does not agree with the commenter's proposed 60-day deadline. The information and data collected pursuant to this subchapter will serve to advise the 81st Legislature, which begins on January 13, 2009, and others concerning the existence, scale, and possible sources of issues pertaining to the use of non-network providers and network adequacy and should be made available earlier in the legislative session than would be possible if submitted 60 days after the adoption of the rules. The Department believes that a February 27, 2009 submission deadline will provide health benefit plan issuers with sufficient time from the effective date of the rule to collect and submit the required information and data. Additionally, because much of the information required for submission by the health benefit plan issuers should be readily available to the health benefit plan issuers, this revised timeframe should allow for accurate collection and reporting of the required information and data. The Department is also of the opinion that the February 27, 2009 submission deadline will provide adequate time for the Legislature to review and utilize the information and data.
The Department has determined that it is necessary to make a clarification change to §21.4602 as proposed. Section 21.4602 as adopted contains a new subsection (d) to clarify that the rule does not apply to issuers that provide coverage solely for dental, vision, or behavioral health care. This clarification is necessary to eliminate any ambiguity in the non-applicability of the rule to issuers that provide coverage solely for dental, vision, or behavioral health care. The collection of information and data from these issuers would not provide stakeholders with relevant data and therefore, is not necessary for the mandated study of facility-based provider network adequacy of health benefit plans by the Advisory Committee. The proposed rules were not intended to apply to these types of issuers.
Also, the Department has made minor editorial changes to §21.4603(a) and (b), §21.4604(a), and §21.4605(a) and (b) as adopted. References to Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) have been reformatted to specify the form number first followed by the form title. These editorial changes are necessary to enhance the user-friendliness of the rules.
The following is a section-by-section summary of the adopted sections and the reasons for the adoption.
Adopted §21.4601 is necessary to clarify the purpose of the subchapter. The subchapter prescribes the requirements for the information and data to be submitted to the Department concerning the use of non-network providers by insureds and enrollees of health benefit plans as required by Section 20 of SB 1731. The subchapter also facilitates the study of facility-based provider network adequacy of health benefit plans by the Advisory Committee appointed by the Commissioner as required by Insurance Code §1456.0065.
Adopted §21.4602 is necessary to address the applicability of the subchapter. Pursuant to SB 1731, Section 20, the Commissioner must require by rule that each health benefit plan issuer subject to the Insurance Code Chapter 1456 submit information to the Department concerning the use of non-network providers by health benefit plan insureds and enrollees and the payments made to those providers. The adopted applicability accords with the Insurance Code §1456.002. Adopted §21.4602(a) specifies various types of issuers that provide benefits for medical or surgical expenses to whom the rule applies. Adopted §21.4602(b) clarifies the applicability of the adopted information and data reporting requirements to governmental employee plans. This clarification is necessary to eliminate any ambiguity in the applicability of the rule to governmental employee plans. "Governmental employee plans" means certain of those health benefit plans under Title 8, Health Insurance and Other Health Coverages, Subtitle H, Health Benefits and Other Coverages for Governmental Employees, specifically Insurance Code Chapters 1551, 1575, 1578, 1579, and 1601. Insurance Code §1456.0065 requires the health care network adequacy advisory committee to study facility-based provider network adequacy of "health benefit plans." Insurance Code §1456.0065 broadly defines "health benefit plan" to mean "an insurance policy or a contract or evidence of coverage issued by a health maintenance organization or an employer or employee sponsored health plan." Including governmental employee plans in this study is consistent with the mandate in Insurance Code §1456.0065. Adopted §21.4602(c) is necessary to clarify that the adopted rule does not apply to Medicaid and state child health insurance plans. Adopted §21.4602(d) clarifies that the adopted rule does not apply to an issuer that provides coverage solely for dental, vision, or behavioral health care. This clarification is necessary to eliminate any ambiguity in the inapplicability to these types of issuers.
Adopted §21.4603(a) addresses the requirement to collect the requested information and data. Adopted §21.4603(a) is necessary to require health benefit plan issuers to collect the underlying data necessary for submission of all information specified in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey). Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) is adopted by reference in §21.4605(a). Adopted §21.4603(a) is also necessary to require health benefit plan issuers to collect the underlying data necessary for submission of all information specified in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid). Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) is adopted by reference in §21.4605(b). Adopted §21.4603(b) is necessary to address the time periods for which the information and data is to be provided. It provides that the 12-month reporting period for the information and data requested in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) is calendar year 2007. Adopted §21.4603(b) further provides that the enrollment data required in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) for private market plans, governmental employee plans, and Local Government Code Chapter 172 risk pools is for the total number of lives covered under the plans as of September 1, 2008. Finally, adopted §21.4603(b) provides that the information and data requested in Form No. LHL608 (Health Benefit Plan Issuer Hospital Grid) is to be based on the health benefit plan issuer's current practices and network arrangements.
Adopted §21.4604 addresses the requirements and deadlines for the submission of the requested information and data. Adopted §21.4604(a) is necessary to specify the deadline for submission of the requested information and data. It requires that each health benefit plan issuer subject to the rules submit to the Department the information and data required in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) by no later than February 27, 2009. This deadline is necessary to allow time for review of the information and data by the Advisory Committee, the Legislature, the Governor, Lieutenant Governor, Speaker of the State House of Representatives, the Commissioner, and the chairs of the standing committees of the State Senate and House of Representatives that have primary jurisdiction over health benefit plans, as provided for in Insurance Code §1456.0065. Adopted §21.4604(b) is necessary to specify the procedures for electronic filing of the required information and data.
Adopted §21.4605 is necessary to adopt by reference the two forms to be used in reporting the information and data required in the new subchapter. Adopted §21.4605(a) adopts by reference Form No. LHL608, entitled Health Benefit Plan/Provider Contracting Practices Survey. The survey form is necessary to require health benefit plan issuers to submit information in narrative responses regarding current contracting practices relating to the use of in-network and non-network providers by health benefit plan enrollees and the payments made to those providers. The survey form is also necessary to require health benefit plan issuers to submit information for both in-network and non-network claims for facility-based physicians for calendar year 2007. Specifically, the survey form requires health benefit plan issuers to report total claim units, total billed amount, and total allowed amount for each type of facility-based physician listed on the form (Anesthesiologist, Pathologist, Radiologist, Neonatologist, and Emergency Department Physician).
Additionally, Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey), is necessary to define the terms used in reporting the information and data required in the form and to provide detailed instructions concerning the information and data to be reported. The definitions are set forth in Instruction No. 7 of the form. The terms "in-network" and "non-network" are defined consistent with common usage in the health insurance and medical provider communities. The definition of the term "balance billing" excludes patient financial responsibility amounts attributable to copayments, coinsurance or deductible amounts for the purpose of eliciting information more specifically related to the issue of network adequacy. The questions in the survey form were developed with input and assistance from the Advisory Committee. The questions are designed to allow for a free form narrative response and to elicit information regarding the methods and means for identifying facility-based providers at in-network facilities and how health benefit plan issuers contract with those providers. During the development of the survey questions, Advisory Committee members particularly focused on the need to obtain information regarding general contracting practices between health benefit plan issuers and health care providers while respecting the need to maintain the confidential nature of specific contracting practices. The Department therefore drafted the questions to obtain general information that will support the Advisory Committee's statutory mandate to study facility-based provider network adequacy without infringing upon issuer or provider interests in maintaining the confidentiality of proprietary information. Adopted §21.4605(a) is also necessary to provide a link for accessing the form on the Department's website.
Adopted §21.4605(b) adopts by reference Form No. LHL609, entitled Health Benefit Plan Issuer Hospital Grid. The grid form is necessary to enable health benefit plan issuers to submit required information concerning the information and data identifying which hospitals are in-network facilities for the health benefit plan issuer and which in-network physicians or physician practices groups have clinical privileges at those hospitals. The Department selected 281 hospitals for which information is requested in the grid form. These hospitals include every acute care hospital in the state with 100 or more beds and 20 percent of smaller acute care hospitals, as identified by the Texas Department of State Health Services. Not every hospital in the state is included in the survey. The selected hospitals constitute a representative sample that will enable the Department to collect information and data concerning hospitals ranging from the very large to the smaller hospitals. The Department is of the opinion that the hospitals included in the survey will provide the information and data necessary to identify whether there are disparate problems in insureds and enrollees being able to access in-network providers as a result of the size or location of the facility. The grid form also defines the terms used in reporting the information and data required in the form and provides detailed instructions concerning the information and data to be reported. Adopted §21.4605(b) is also necessary to provide a link for accessing the form on the Department's website.
3. HOW THE SECTIONS WILL FUNCTION. Adopted §21.4601 outlines the purpose of the subchapter.
Adopted §21.4602 addresses the applicability and inapplicability of the new subchapter. It specifies the types of health benefit plans, issuers, programs, and other entities to which the subchapter does and does not apply. Adopted §21.4603 addresses the requirement to collect the requested information and data and the time periods for which the information and data is to be provided. Adopted §21.4603(a) requires health benefit plan issuers to collect the underlying data necessary for submission of all information specified in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid). These two forms are adopted by reference in §21.4605(a) and (b) respectively. Adopted §21.4603(b) addresses the time periods for which the information and data is to be provided. It provides that: (i) the 12-month reporting period for the information and data requested in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey), including the data for the in-network and non-network claims for facility-based physicians, is calendar year 2007; (ii) the enrollment data required in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) for private market plans, government employee plans, and Local Government Code Chapter 172 risk pools, is for the total number of lives covered under the plans as of September 1, 2008; and (iii) the information and data requested in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) is to be based on the health benefit plan issuer's current practices and network arrangements.
Adopted §21.4604 addresses the requirements and deadlines for the submission of the requested information and data. New §21.4604(a) specifies the deadline for the submission of the required information and data. Each health benefit plan issuer subject to the rules is required to submit to the Department the information and data required in Form No. LHL608 and Form No. LHL609 by no later than February 27, 2009. Adopted §21.4604(b) specifies the procedures for electronic filing of the required information and data.
In adopted §21.4605, the two forms to be used in reporting the information and data required by the rule are adopted by reference. Adopted §21.4605(a) adopts by reference Form No. LHL608, entitled Health Benefit Plan/Provider Contracting Practices Survey. Health benefit plan issuers must utilize this form to submit summary company identification and contact information. The issuers must also provide general information in narrative responses regarding current contracting practices relating to the use of in-network and non-network providers by health benefit plan enrollees and the payments made to those providers. Health benefit plan issuers must also use this form to submit individual health benefit plan issuer information for both in-network and non-network claims for facility-based physicians for calendar year 2007. The form contains detailed instructions for completion. Adopted §21.4605(a) also provides a link for accessing the form on the Department's website.
Adopted §21.4605(b) adopts by reference Form No. LHL609, entitled Health Benefit Plan Issuer Hospital Grid. Health benefit plan issuers must provide the same company identification and contact information required in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey). Health benefit plan issuers must complete this form, which contains detailed instructions. Health benefit plan issuers must submit information regarding which hospitals are in-network facilities. For those hospitals, information must be submitted regarding which in-network physician or physician practice groups have clinical privileges. Adopted §21.4605(b) also provides a link for accessing the form on the Department's website.
4. SUMMARY OF COMMENTS AND AGENCY RESPONSE.
General Comments
Comment: One commenter recommends that the Department limit the collection of data by rule to the data required by SB 1731. The commenter asserts that the collection and reporting of narrative responses regarding contracting practices and the hospital grid information required to be submitted on Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) are not required by SB 1731. The commenter notes that SB 1731, Section 20, requires the Department to adopt rules requiring each health benefit plan to provide data on the use of non-network providers. The commenter states that while it is the Department's prerogative to collect the information by rule, much of that data has been collected through the Advisory Committee on Health Network Adequacy (the Advisory Committee). The commenter also asserts that the voluntary nature of submissions of crucial data by providers to the Department is an ongoing issue faced by the Advisory Committee. The commenter states that the organization he represents has no real, specific objection to the information required for collection and reporting in the proposed rule.
Agency Response: The Department is not requesting any information or data that is not authorized by SB 1731. The narrative information requested by the rule concerns contracting practices and the availability of in-network provider facility-based providers. The Department believes that there is authority to request such information and that it is appropriate to include the collection of this information in the rule. Section 20 of SB 1731 mandates the Commissioner by rule to require each health benefit plan issuer subject to Insurance Code Chapter 1456 to submit information to the Department concerning the use of non-network providers by health benefit plan insureds and enrollees and the payments made to those providers. Section 20 further directs the Commissioner to work with the Advisory Committee to develop the data collection and evaluate the information collected. Insurance Code §1456.0065 requires the Advisory Committee to study facility-based provider network adequacy of health benefit plans. Inclusion of the collection and reporting of narrative responses regarding contracting practices and the hospital grid information required to be submitted on Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) is necessary to fulfill the Department's and the Advisory Committee's responsibilities under Section 20 of SB 1731 and the Insurance Code §1456.0065. A health benefit plan issuer's contracting practices and the availability of in-network facility-based providers directly affect and inform network adequacy and, as a result, the use of non-network providers. Therefore, the narrative information will assist the Advisory Committee to more fully understand facility-based provider network adequacy of health benefit plans and will facilitate the development of a more comprehensive study. The Department acknowledges that some health benefit plan issuers have already provided similar information concerning availability of in-network facility-based providers to the Advisory Committee on a voluntary basis. However, not all health benefit plan issuers have provided that voluntary information. Inclusion of that information in this data collection will result in overall information of a more comprehensive and timely nature. The additional information will ultimately better serve the Committee, the Legislature, and other state officials to whom the Committee will report. With regard to the commenter's assertion concerning submissions by providers, the Department does not agree that the lack of departmental authority to mandate submission of information and data by providers constitutes a valid basis for limiting its collection of information and data from health benefit plan issuers. The lesser availability of information from providers does not diminish the importance of the information and data that health benefit plan issuers are required to provide under this rule.
Comment: One commenter recommends that the rules specify that the data collection is a one-time occurrence and include an expiration date. The commenter notes that the proposal specifies in the preamble that the data collection is a one-time occurrence. In the alternative, the commenter suggests that the rule be put on the Department's calendar for repeal.
Agency Response: The commenter is correct that this subchapter requires a one-time data submission for each adopted form. Adopted §21.4604(a) specifies a single submission date for both of the forms. Section 21.4604(a) as adopted provides that each health benefit plan issuer to whom the subchapter applies must submit to the Department the information and data required in Form No. LHL608 and Form No. LHL609 by no later than February 27, 2009. The Department therefore disagrees that the specific inclusion of an expiration date is necessary. However, pursuant to the statutory mandate in Government Code §2001.039, the Department will consider the repeal of the rule as part of its periodic ongoing review of existing agency rules.
Comment: A commenter requests that the Department seek a memorandum of understanding with the Department of State Health Services and the Texas Medical Board in order to allow the Department of Insurance to collect information and data from hospitals and providers, respectively. The commenter also asserts that, consistent with the purpose of the Advisory Committee on Network Adequacy, the collection of information from other stakeholders would better inform the judgments of the Legislature.
Agency Response: SB 1731 does not authorize or require the Department to enter into any memorandum of understanding relating to the collection of information and data from other entities not specified in SB 1731 or on any other issues relating to the implementation of Section 20 of SB 1731. In the process of collecting information, stakeholders of the Advisory Committee on Health Network Adequacy, which includes hospitals and providers, have voluntarily provided information and data to the committee. While the Department agrees that memorandums of understanding with other state regulatory agencies are helpful in many instances, the Department believes that the Section 20 mandate may be fully implemented without such memorandums.
Comment: A commenter supports adoption of the rules as proposed and expresses appreciation for the work of Department staff.
Agency Response: The Department appreciates the commenter's statement of support.
§21.4604(a). Submission of Information and Data.
Comment: One commenter objects to the proposed submission requirement in §21.4604(a) that requires the information and data to be reported on or before January 9, 2009. The commenter proposes an alternative submission deadline of 60 days after adoption of the final rule. The commenter specifies the following reasons for the objection and alternative deadline proposal: (i) the proposed submission date is shortly after the winter holiday period when staff is less available for additional work; (ii) the proposed submission deadline falls within an already busy reporting period; and (iii) the Department will have already provided initial data to the Legislature in its report, which is required by SB 1731 to be submitted in December.
Agency Response: Section 21.4604(a) as adopted requires submission of the information and data as required in this subchapter by no later than February 27, 2009. The proposed January 9 submission deadline is no longer viable due to the effective date of this adoption. The Department does not agree with the commenter's proposed 60-day deadline for the following reasons. The information and data collected pursuant to this subchapter will serve to advise the 81st Legislature, which begins on January 13, 2009, and others concerning the existence, scale, and possible sources of issues pertaining to the use of non-network providers and network adequacy and should be made available earlier in the legislative session than would be possible if submitted 60 days after the adoption of the rules. The Department believes that the February 27, 2009 deadline will provide health benefit plan issuers with sufficient time from the effective date of the rule to collect and submit the required information and data. Because much of the information required for submission by the health benefit plan issuers should be readily available to the health benefit plan issuers, this timeframe should allow for accurate collection and reporting of the required information and data. The Department is also of the opinion that the February 27, 2009 deadline will provide time for the Legislature to review and utilize the information and data. Additionally, the Department's submission of initial data to the Legislature does not alter the importance of the additional information to be collected as a result of this subchapter.
Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) Instruction Nos. 9 and 10
Comment: A commenter states that Instruction No. 10 of the Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) appears to allow a plan that insures or administers governmental employee plans to include that information in its aggregate figures and indicate which plans or pools are included. The commenter asserts that separate reporting on behalf of such pools would be a substantial burden and requests clarification of whether the commenter's interpretation is correct. Another commenter states that its organization is pleased that governmental plans and Chapter 172 Risk Pools will have flexibility in determining the most appropriate manner in which to submit the required reports.
Agency Response: The Department clarifies that the submission of separate reports for a health benefit plan issuer and the governmental employee plans or risk pools created under Local Government Code Chapter 172 that the issuer administers, while permissible, are not required. As described in instruction Nos. 9 and 10 on Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey), a governmental employee plan or a risk pool created under Local Government Code Chapter 172 must either independently submit the report form or authorize and require the entity administering the plan or risk pool to submit the form on its behalf. If reporting on behalf of a governmental employee plan or a risk pool, the reporting issuer must identify the name of the plan or risk pool and the total number of lives for that plan or risk pool as of September 1, 2008. The instructions do require identification of each governmental plan or risk pool and submission of the total lives covered under each governmental plan and/or risk pool. Responses to the actual survey questions and data collection in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey), however, may be submitted as aggregate information and data on behalf of both the issuer's plans and those plans or pools which it administers. The Department appreciates the commenter's supportive comment.
Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) Question Nos. 7 - 13
Comment: A commenter supports adoption of Question Nos. 7 - 13 of Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) without change because the questions address information about the out-of-network coverage insureds receive for their premium dollar. The commenter asserts that the questions will result in information on the claim settlement practice used by carriers in Texas that is necessary for consideration by legislators, the Department, and stakeholders. Specifically, the commenter asserts that the responses to these questions are necessary to clarify the relationship between amounts covered and amounts billed by the physician or other health care provider. The commenter further asserts that the questions are necessary to demonstrate the relationship between an insurer's actions to limit its financial risk and the loss suffered by an insured. Finally, the commenter asserts that the questions are necessary for evaluation of the value of the out-of-network benefit coverage in comparison to premium payments.
Agency Response: The Department appreciates the commenter's support. Question Nos. 7 - 13 are adopted without change.
Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) Question No. 14
Comment: One commenter supports inclusion of Question No. 14 of Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) but suggests modification of the question into two parts as follows: (a) Does the health benefit plan issuer limit some of its facility-based physician contract offers to only those services provided to patients receiving inpatient or outpatient services at the facility? If yes, specify those provider types that receive such offers. (b) Does the health benefit plan issuer offer to some physicians practicing pathology, radiology, anesthesia, neonatology, or emergency medicine an exclusive contract for services that are performed outside hospitals? The commenter asserts that many procedures are performed at hospitals on an outpatient basis and that a technical interpretation of the questions will result in exclusion of information related to contracting for those services if the question is not modified to specifically include them. The commenter asserts that the second part of its suggested language is necessary to identify arrangements for exclusive provision of services performed outside of hospitals, such as services performed at ambulatory surgical centers or laboratories. According to the commenter, these exclusive arrangements introduce possible increases in patient financial responsibility and impede quick access to on-site services. The commenter further asserts that information concerning the offer of contracts that do not encompass the full spectrum of a physician's services is important for full appreciation of the factors considered by physicians and healthcare providers in deciding whether to participate in a network.
Agency Response: The Department disagrees with the suggested modification of Question No. 14 in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey). The proposed language in Question No. 14 only requires disclosure of whether some contracts offered by the health benefit plan issuer to facility-based physicians are limited to provision of inpatient services. Expanding the scope of the question to services not specifically contemplated in connection with this question would deny other stakeholders adequate notice and opportunity to comment on the new requirement. It would therefore constitute a substantive change to the proposed rule and require publication of the proposed new requirement and a 30-day comment period. Further, identification of whether health benefit plan issuers offer contracts to some facility-based providers that are limited to inpatient services will still provide information about factors that may be considered by physicians and health care providers in deciding whether to participate in a network. Finally, the Department disagrees that it is necessary to identify whether a health benefit plan issuer offers some physician's exclusive contracts for pathology, radiology, anesthesia, neonatology, or emergency medicine services performed outside of the hospital in order to determine factors that affect a physician's decision about whether to participate in a network. A physician's consideration of the limited spectrum of services included in a proffered contract will likely affect the physician's determination about participation regardless of the health benefit plan issuer's motivation for offering the more limited contract.
Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) Question No. 17
Comment: One commenter requests that, in light of the proposed submission deadlines, the Department in the instructions for Question No. 17 of Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) consider removing the requirement to exclude from submitted claim information those claims paid as a secondary payor. According to the commenter, the proposed requirement will make programming more complex for some health benefit plan issuers.
Agency Response: The Department declines to change the requirement excluding claims paid on a secondary plan basis. This determination is based on careful consideration of this issue and discussions with the Advisory Committee. The Department's position is that limiting the submitted claims information to those claims paid on a primary plan basis is appropriate because it will produce information regarding the use of in-network and out-of-network facility-based physicians with respect to the health benefit plan issuers that are submitting the information. The availability of the primary plan's in-network physicians is likely to be a greater consideration in an insured's or enrollee's decisions about where to obtain health care than is the availability of in-network physicians under a secondary plan. While separating secondary claims may require additional resources for some health benefit plan issuers, doing so will improve data validity. Further, each health benefit plan issuer may have characteristics that are unique to its particular information technology processes and systems. During discussions of the Advisory Committee and in comments on the informal draft of this rule published on the Department's website, a different health benefit plan issuer indicated that it typically did not include payments made on a secondary basis in its reports and sought confirmation that such exclusion would be appropriate for submission of information in response to this question. Because there is likely a closer relationship between a plan's network availability and claims paid by that health benefit plan issuer on a primary plan basis, the Department is of the opinion that requiring the exclusion of claims paid on a secondary basis is necessary for the consistency and integrity of the data.
Comment: One commenter requests clarification regarding the meaning of "total claims unit" as defined in the instructions for Question No. 17 of Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey). The commenter states that according to industry nomenclature the term refers to units within a claim rather than the claim itself.
Agency Response: The Department agrees that the term "total claim units" refers to individual units within a claim form in accord with industry usage. A single claim form may include billing for multiple procedural codes. Claims data should be reported on a line item basis. That means that each claim unit is reported separately rather than aggregated as a single claim where submitted together on one claim form. For example, if a claim form includes three claims units, then each claim unit will be reported as a separate claim unit.
Comment: A commenter requests clarification regarding whether reprocessed claims should be reported in the claim information for Question No. 17 of Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey).
Agency Response: Claims information resulting from the reprocessing of claims after calendar year 2007 is not required to be reported for Question No. 17. Adopted §21.4603 requires claims data in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) to be submitted for calendar year 2007. Adopted §21.4603 requires that all applicable claims for calendar year 2007 be reported. If a claim was reprocessed in calendar year 2007, however, then the reprocessed claim should be reported and the initial claim should not be reported except to the extent that information concerning individual claim units remained unchanged as a result of the reprocessing.
Comment: One commenter suggests that the reporting elements in Question No. 17 in Form No. LHL608 be revised to include the total amount paid for both in-network and out-of-network claims. While the commenter expresses strong support for inclusion of Question No. 17 concerning claim information for facility-based physicians in calendar year 2007, the commenter states that the additional information would provide legislators and interested stakeholders with an idea of exactly the amount of financial risk that is placed upon Texans who have purchased an insurance policy.
Agency Response: The Department appreciates the commenter's support. However, the Department declines to adopt an additional reporting requirement of "Total Amount Paid" for Question No. 17. The Department does not agree that the additional information suggested by the commenter will be helpful enough to stakeholders to require health benefit plan issuers to report this data. The Advisory Committee and the Department specifically discussed the inclusion of a "Total Amount Paid" field in Question No. 17 of the Health Benefit Plan/Provider Contracting Practices Survey and determined to not include such a field for several reasons. First, deductibles, copayments, and coinsurance terms can vary widely among individual plans depending on the cost to the employer, insured, or enrollee. For example, a health benefit plan issuer may offer both high deductible and low deductible plans. Second, application of these varying contractual terms to the health benefit plan issuer's liability for payment would make aggregated "Total Amount Paid" data potentially misleading and hamper its usefulness as an analytic tool. For example, if half of a benefit plan issuer's insureds or enrollees had a 20% coinsurance requirement, but the other half of its insureds or enrollees had a 50% coinsurance requirement, the aggregated Total Amount Paid would not provide meaningful data on what facility-based physicians receive per claim. If Question No. 17 included submission of "Total Amount Paid," that number would only reflect the portion paid to health providers by the health benefit plan issuers and would not reflect patient financial responsibility amounts. Third, this data collection is focused on a macro level view of the total claims experience for facility-based physicians rather than details at the level of individual claims. Fourth, adopted Question No. 17 does require health benefit plan issuers to report both total billed amounts and total allowed amounts for applicable claims. The difference between those figures will yield the potential financial liability of the insured or enrollee beyond the variable patient financial responsibility amounts attributable to plan design.
Form No. LHL609 ( Health Benefit Plan Issuer Hospital Grid)
Comment: One commenter requests clarification that good faith production of information concerning which hospital-based provider groups are under contract at network hospitals is acceptable. A commenter states that health benefit plan issuers would have to rely on the cooperation of hospitals to furnish accurate information concerning which hospital-based provider groups are under contract at network hospitals to accurately complete the information required for submission on the Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid). The commenter asserts that this is important to note because of the potential for disciplinary action against health benefit plan issuers.
Agency Response: The Department does not believe that it is necessary to make additional changes to the instructions for Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid). Instruction No. 9 of Form No. LHL609 expressly recognizes that health benefit plan issuers may not have full and complete information for some hospitals and should, in those cases, provide information to the best of its ability. The plan issuer should also include any limitations and assumptions made in providing a response.
Comment: A commenter inquires whether reporting entities may identify and report the information concerning hospitals in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) on the basis of the hospitals' tax ID or NPI number. The commenter states that different spellings or use of abbreviations in identifying hospitals require a manual process of information retrieval. The commenter states that use of the NPI number or tax ID results in consistency.
Agency Response: Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) requires submission of information based upon a hospital's name rather than by the hospitals' tax ID or NPI number or any other identifier. Therefore, information should not be reported solely on the basis of an individual NPI number or tax identification number. This instruction is based on the Department's discussion with the Advisory Committee during meetings of the committee. Advisory Committee members advised the Department that a single hospital may have multiple NPI numbers and possibly multiple tax identification numbers for different divisions of the hospital. Each health benefit plan issuer is required in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) to identify the appropriate information concerning each hospital identified in the grid. The health benefit plan issuer must identify each hospital's status as in-network or non-network and provide corresponding information concerning in-network physicians or physician groups who have clinical privileges with the hospital as hospital-based physicians. The information required in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) with respect to hospitals is the same information that an insured or enrollee of a health benefit plan should be able to obtain upon request. It is likely that the insureds or enrollees of a health benefit plan issuer would ask for this information by providing the name of the hospital to the issuer. Further, it is unlikely that an insured or enrollee would know the NPI number or taxpayer identification number of the hospital.
Comment: One commenter supports adoption of the Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) as proposed.
Agency Response: The Department appreciates the support for Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid). The proposed form is adopted without changes.
5. NAMES OF THOSE COMMENTING FOR AND AGAINST THE PROPOSAL.
For: Office of Public Insurance Counsel; Texas Association of Counties.
For with changes: Texas Association of Health Plans; Texas Medical Association.
Against: None.
6. STATUTORY AUTHORITY. The new sections are adopted under Section 20 of SB 1731, as enacted by the 80th Legislature, Regular Session, effective September 1, 2007, and the Insurance Code §1456.0065, §1212.002, and §36.001. Section 20(a) of SB 1731 provides that the Commissioner shall by rule require each health benefit plan issuer subject to Insurance Code Chapter 1456 to submit information to the Department concerning the use of non-network providers by health benefit plan enrollees and the payments made to those providers. The Commissioner is required to work with the network adequacy study group to develop the data collection and evaluate the information collected. Section 20(b) of SB 1731 provides that an issuer that fails to submit data as required under Section 20 is subject to an administrative penalty under the Insurance Code Chapter 84. Further, each date the issuer fails to submit the data as required is a separate violation for purposes of penalty assessment. Section 1456.0065 requires the Commissioner to appoint an advisory committee to study facility-based provider network adequacy of health benefit plans. The Advisory Committee is required to be composed of one or more physician representatives; one or more hospital representatives; one or more health benefit plan representatives to equal the total number of physician and hospital representatives; and one representative from each association representing physicians, hospitals, and health benefit plans. The Advisory Committee is required to advise periodically and not later than December 1, 2008, the Governor, Lieutenant Governor, Speaker of the House of Representatives, Commissioner, and the Chairs of the standing committees of the Senate and House of Representatives that have primary jurisdiction over health benefit plans, of its findings. Chapter 1212 of the Insurance Code provides for the appointment and operation of the Technical Advisory Committee on Claims Processing. Section 1212.002 requires the Commissioner to consult with the technical advisory committee before adopting any rule related to the coding of health care services and claims development, submission, processing, adjudication, and payment, as well as the impact on those processes of contractual requirements and relationships, including relationships among employers, health benefit plans, insurers, health maintenance organizations, preferred provider organizations, electric clearinghouses, physicians and other health care providers, third-party administrators, independent physician associations and medical groups. Section 36.001 authorizes the Commissioner of Insurance to adopt any rules necessary and appropriate to implement the powers and duties of the Texas Department of Insurance under the Insurance Code and other laws of this state.
7. TEXT.
§21.4601. Purpose. The purpose of this subchapter is to:
(1) prescribe the requirements for the information and data to be submitted to the department concerning the use of non-network providers by insureds and enrollees of health benefit plans subject to Chapter 1456 of the Insurance Code and the payments made to those providers, as required by Section 20 of SB 1731, 80th Legislature, Regular Session, effective September 1, 2007 (Section 20 of SB 1731); and
(2) facilitate the study of facility-based provider network adequacy of health benefit plans by the Advisory Committee on Health Network Adequacy appointed by the commissioner, as required by the Insurance Code §1456.0065.
§21.4602. Applicability.
(a) Pursuant to section 20 of SB 1731 and the Insurance Code §1456.002(a), this subchapter applies to issuers of:
(1) any health benefit plan that provides benefits for medical or surgical expenses incurred as a result of a health condition, accident, or sickness, including an individual, group, blanket, or franchise insurance policy or insurance agreement, a group hospital service contract, or an individual or group evidence of coverage that is offered by:
(A) an insurance company;
(B) a group hospital service corporation operating under the Insurance Code Chapter 842;
(C) a fraternal benefit society operating under the Insurance Code Chapter 885;
(D) a stipulated premium company operating under the Insurance Code Chapter 884;
(E) a health maintenance organization operating under the Insurance Code Chapter 843;
(F) a multiple employer welfare arrangement that holds a certificate of authority under the Insurance Code Chapter 846; or
(G) an approved nonprofit health corporation that holds a certificate of authority under the Insurance Code Chapter 844; or
(2) any health benefit plan that provides health and accident coverage through a risk pool created under Chapter 172, Local Government Code, notwithstanding §172.014, Local Government Code, or any other law.
(b) Pursuant to section 20 of SB 1731 and the Insurance Code §1456.002(b), this subchapter applies to any person to whom a health benefit plan contracts to process or pay claims, to obtain the services of physicians or other providers to provide health care services to insureds and enrollees, or to issue verifications or preauthorizations, including:
(1) a basic coverage plan under the Insurance Code Chapter 1551;
(2) a basic plan under the Insurance Code Chapter 1575;
(3) a basic plan under the Insurance Code Chapter 1578;
(4) a primary care coverage plan under the Insurance Code Chapter 1579; and
(5) a basic coverage plan under the Insurance Code Chapter 1601.
(c) Pursuant to the Insurance Code §1456.002(c), this subchapter does not apply to:
(1) Medicaid managed care programs operated under the Government Code Chapter 533;
(2) Medicaid programs operated under the Human Resources Code Chapter 32; or
(3) the state child health plan operated under the Health and Safety Code Chapters 62 or 63.
(d) This subchapter does not apply to an issuer that provides coverage solely for dental, vision, or behavioral health care.
§21.4603. Requirement to Collect Information and Data.
(a) Each health benefit plan issuer identified in §21.4602(a) and (b) of this subchapter (relating to Applicability) shall collect the information and data specified in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) that is adopted by reference in §21.4605(a) of this subchapter (relating to Report Forms) and in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) that is adopted by reference in §21.4605(b) of this subchapter and shall prepare and file information and data in accordance with the requirements in §21.4604 of this subchapter (relating to Submission of Information and Data).
(b) The 12-month reporting period for the information and data requested in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey), including the data for the in-network and non-network claims for facility-based physicians, is calendar year 2007. The enrollment data required in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) and Form No. LHL 609 (Health Benefit Plan Issuer Hospital Grid) for private market plans, governmental employee plans, and Local Government Code Chapter 172 risk pools, is for the total number of lives covered under the plans as of September 1, 2008. The information and data requested in Form No. LHL 609 (Health Benefit Plan Issuer Hospital Grid) is to be based on the health benefit plan issuer's current practices and network arrangements.
§21.4604. Submission of Information and Data.
(a) Each health benefit plan issuer identified in §21.4602(a) and (b) of this subchapter (relating to Applicability) shall submit to the department the information and data required in Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) that is adopted by reference in §21.4605(a) of this subchapter (relating to Report Forms) by no later than February 27, 2009, and the information and data required in Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) that is adopted by reference in §21.4605(b) of this subchapter by no later than February 27, 2009.
(b) The information and data filed pursuant to this section shall be filed electronically by accessing a link designated on the department's website, www.tdi.state.tx.us, and by emailing the completed forms to networkadequacy@tdi.state.tx.us.
§21.4605. Report Forms.
(a) The commissioner adopts by reference Form No. LHL608 (Health Benefit Plan/Provider Contracting Practices Survey) which contains instructions for completion of the form; requires information to be provided regarding health benefit plan issuer identification; and requires narrative responses to 16 questions relating to how health benefit plan issuers contract with providers and determine reimbursement rates. The form also requests in Question No. 17 individual health benefit plan issuer information for both in-network and non-network claims for facility-based physicians for calendar year 2007, including for each type of facility-based physician listed on the form (Anesthesiologist, Pathologist, Radiologist, Neonatologist, Emergency Department Physician) total claim units, total billed amount, and total allowed amount. The form is available at www.tdi.state.tx.us/forms/form10other.html.
(b) The commissioner adopts by reference Form No. LHL609 (Health Benefit Plan Issuer Hospital Grid) which contains instructions for completion of the form; requires information to be provided regarding health benefit plan issuer identification; and requires information to be provided by each health benefit plan issuer regarding which hospitals are in-network facilities and for those hospitals, which in-network physician or physician practice groups have clinical privileges. The 281 hospitals listed in the form include every acute care hospital in the state with 100 or more beds and 20 percent of smaller acute care hospitals, as identified by the Texas Department of State Health Services. The form is available at www.tdi.state.tx.us/forms/form10other.html.