Source: http://www.tdi.texas.gov/rules/2003/0623b-059.html
Timestamp: 2018-06-24 03:28:15
Document Index: 721788505

Matched Legal Cases: ['§19', '§19', '§19', 'Art. 3', '§19', '§19', '§19', '§19', '§19', '§19', '§19', '§19', '§19', '§19', '§19', '§2006', '§2006', '§36', '§19', '§843', '§19', '§21', '§19', '§19', '§19']

28 TAC §§19.1703, 19.1723, and 19.1724.
The Texas Department of Insurance proposes amendments to §19.703 and new §§19.1723 and 19.1724 concerning procedures by which preferred providers that contract with an insurer or health maintenance organization (hereinafter referred to as "physicians and providers") may request, and insurers that issue preferred provider benefit plans and health maintenance organizations (hereinafter collectively "carriers") may provide, preauthorization and verification of medical care or health care services. These proposed amendments and new sections are the result of the enactment of SB 418 during the 78 th Legislative Session. That legislation amended Texas Insurance Code Art. 3.70-3C, concerning preferred provider benefit plans, and the HMO Act, Insurance Code Chapter 843, to provide comprehensive changes to the procedures and requirements governing the processing and payment of clean claims submitted by physicians and providers. Among other things, SB 418 sets forth the concepts of preauthorization, where the medical necessity and appropriateness of services is determined, and verification, which is a reliable representation by a carrier that it will pay a physician or provider for proposed medical services, if those services are rendered to the patient for whom the services are proposed. SB 418 also provides that if a carrier has issued a verification for proposed medical or health care services, it may not deny or reduce payment to the physician or provider for those services if they are provided on or before the expiration date of the verification, which shall not be less than 30 days. The only statutory exception to this guarantee of payment is if the physician or provider materially misrepresents or substantially fails to perform the services. SB 418 contains similar requirements for preauthorization, stating that a carrier that preauthorizes may not deny or reduce payment based on medical necessity or appropriateness of care, except for the reasons, as previously stated.
SB 418 also contains provisions regarding the prompt payment of claims and the availability of coding guidelines through contracts with preferred provider carriers and HMOs. These provisions are addressed in proposed rules published elsewhere in this issue of the Texas Register,
The proposed amendments to §19.1703 add new definitions for the terms declination, preauthorization, preferred provider, and verification. "Declination" is defined as a response to a request for verification in which a carrier declines to guarantee payment for proposed services prior to receiving a claim; however, the proposed definition makes clear that a declination is not a determination that a claim resulting from the proposed services may not ultimately be paid. While the department anticipates carriers will make a good faith effort to respond to requests for verification, it acknowledges that there may be some instances where a carrier will not have sufficient information to make a binding determination in accordance with the terms of the insurance contract or evidence of coverage. In these instances, the carrier may need to make use of the entire claims adjudication process provided by SB 418. Under those circumstances, the department anticipates that carriers will continue to process clean claims in compliance with all statutory and regulatory requirements, including timely payment. Accordingly, it is important for physicians and providers, as well as enrollees and insureds, to understand that a declination of verification should not in any way hinder the provision of medical or health care services or the timely payment of claims. In addition, prior to enactment of SB 418, it was customary for physicians and providers to request and receive patient eligibility information from carriers. While an eligibility determination from a carrier was not a guarantee of payment, it still may be a useful option for physicians, providers and carriers, and nothing in this proposed rule prohibits these parties from continuing to utilize those processes that are already in place.
Because the existing rule does not contain a definition for "preferred provider," the proposed amendments to §19.1703 add a definition that applies to providers that are contracted with HMOs and preferred provider carriers. They define "preauthorization" as a determination by a carrier that medical or health care services proposed to be provided are medically necessary and appropriate.
The proposal defines "verification" as a guarantee by a carrier that it will pay for proposed medical care or health care services if the services are rendered within the required timeframe to the patient for whom the services are proposed. The term includes pre-certification, certification, re-certification and any other term that would be a reliable representation by a carrier to a physician or provider, if those requests include the information required by proposed §19.1724(c).
Proposed §19.1723 requires that a carrier that uses a preauthorization process shall provide to each contracted preferred provider, not later than the 10 th business day after a request is made, a list of medical care and health care services that require preauthorization, along with information concerning the preauthorization process. If the proposed services involve inpatient care, a carrier that approves a request must issue a length of stay for admission into a health care facility based on the recommendation of the preferred provider and the carrier´s written medically accepted screening criteria and review procedures.
The proposed section sets forth timeframes in which a carrier must respond to preauthorization requests for those services requiring preauthorization: concurrent hospitalization, within 24 hours of receipt; services involving post-stabilization treatment or life-threatening condition, within the time appropriate to the circumstances and the condition of the patient, but in no case to exceed one hour of receipt; and for all other services, not later than the third calendar day after receipt. A carrier that issues an adverse determination in response to a post-stabilization or life-threatening condition treatment must provide the independent review organization notification required by current §19.1721(c). A carrier that issues any other adverse determination must comply with current §19.1710 concerning notice of determinations by utilization review agents.
A carrier must have appropriate personnel reasonably available at a toll-free telephone number to provide the preauthorization determination during the hours and days prescribed in the proposed rule. The carrier must also be able to receive and record calls at other times than the hours specified in the proposed rule, and respond to those calls within 24 hours. The carrier must provide a written notification within three days of receipt of request.
A carrier that has preauthorized care or services may not deny or reduce payment for those services, based on medical necessity or appropriateness of care, unless the physician or provider has materially misrepresented or failed to perform the services. The proposed section states that it applies to an agent or other person with whom a carrier contracts, and provides that the provisions of the section may not be waived, voided, or nullified by contract.
Proposed §19.1724 requires carriers to be able to receive requests for verification by telephone, in writing, and through other means as may be agreed to by the provider and carrier. It requires carriers to have appropriate personnel reasonably available at a toll-free telephone number to accept telephone requests and to provide determinations of previously requested verifications, at the days and hours prescribed in the rule, and to receive and record calls at all other times and respond not later than two calendar days after the call is received. The proposal contains a list of information that must be contained in a request for verification. The department believes this amount of information is necessary for two reasons. First, because a carrier that verifies may not deny or reduce payment for a service, verification will essentially constitute the adjudication of a claim. For that reason, it is important that the carrier have all necessary information in order to make this binding determination. Second, the department anticipates that giving more information to carriers up front will result in more requests for services receiving verification. The proposed section also allows a carrier, within three days of a request for verification, to make one written request to the preferred provider for additional information that is specific to the request, relevant and necessary to resolution of the request, and for information in or being incorporated into the enrollee´s medical or billing record.
Proposed §19.1724 contains the following timeframes by which carriers must respond to a request for verification: for concurrent hospitalizations, post-stabilization care, or life-threatening condition, without delay but not later than 72 hours after the request; all other requests, without delay but not later than 15 days after the date of the request. The department believes this is consistent with SB 418, which provides that a carrier must inform a preferred provider "without delay"whether the service for which verification has been requested will be paid. Because verification could be requested for a wide variety of services and product types, some requests will require more processing time than others. As an example, an HMO claim will be more easily adjudicated than an individual preferred provider carrier product that has pre-existing condition exclusions. As noted earlier, access to information will be important in order to allow a carrier to essentially adjudicate the claim before services are actually rendered. However, for more easily adjudicated services, the department expects that a carrier will use only the amount of time necessary to process the request "without delay" rather than the maximum 72 hours or 15 days allowed by the rule.
The proposal states that a verification or declination may be delivered by the carrier via telephone or in writing. If it is delivered via telephone, the carrier must, within three days of providing a verbal response, provide a written response that includes the minimum information listed in the rule, including a statement that the proposed services are being verified or declined pursuant to this rule. The department believes this procedure is important because a verification represents a carrier´s guarantee that it will not deny or reduce payment for the services verified; for that reason, it is extremely important that both the carrier and the physician or provider have a clear understanding as to what services have been verified. Absence of a means of confirming what has been requested and verified could result in misunderstandings and disputes between the parties, which is a situation SB 418 sought to minimize or eliminate. In addition, the statement identifying the response as a verification or declination, as defined herein, will distinguish carrier responses pursuant to this process, versus instances where a carrier may only be providing an eligibility determination.
New §19.1724 is also proposed to apply to a noncontracted physician or provider that provides care on an emergency basis or on a referral basis where services are not reasonably available from a network provider. In addition, it states that the proposed new section´s provisions may not be waived, voided, or nullified by contract.
The Department will consider the adoption of the proposed amendments to §19.1703 and new §§19.1723 and 19.1724 concerning preauthorization and verification in a public hearing under Docket No. 2555 scheduled for August 7, 2003, at 9:30 a.m. in Room 100 of the William P. Hobby Jr. State Office Building , 333 Guadalupe Street in Austin , Texas .
Kimberly Stokes, Senior Associate Commissioner for Life, Health, and Licensing, has determined that for each year of the first five years the proposed amendments and new sections will be in effect there will be no fiscal impact to state and local governments as a result of the enforcement or administration of the amendments or new sections. There will be no measurable effect on local employment or the local economy as a result of the proposal.
Ms. Stokes has also determined that for each of the first five years the amendments and new sections are in effect, the public benefits anticipated as a result of the proposed amendments and new sections will be clear direction for the processing of requests for preauthorization, and assurance that physicians and providers will know in advance which services require preauthorization. In addition, the proposal will establish a clear, comprehensive process by which physicians and providers may make requests for verification and carriers may review and respond to such requests.
Because, as stated earlier, verification is a guarantee of payment for services, it is important that these processes be followed so that carriers have all necessary information in order to essentially adjudicate a claim, and to avoid potential disagreements or misunderstandings between the parties. The SB 418 statutory mechanism for obtaining a verification contemplates a request by a physician or provider via telephone call and providing sufficient information that enables a carrier to issue a verification or declination without delay. Because the result of the verification process is a guarantee of payment, the proposal details procedures that physicians and providers, as well as carriers, must use in order to achieve what is essentially an adjudication of the claim. For this reason, the proposal sets forth a list of requirements that must be included in a request for verification. This required information must be delivered at the time of request, which may occur via telephone call, in writing, or via any other means agreed to by the physician or provider. The department does not anticipate that the addition of the required elements for a request for verification will result in additional costs to physicians and providers. The department´s rationale for this is that all of the information required in the request, including knowledge of the particular services to be provided, should be readily available to a physician or provider that is in a position to request verification, as it is information normally utilized in filing claims. Although compiling this information may require additional work by a physician or provider´s office staff, the physician or provider has the option of transmitting the information by telephone, in writing, or by other means. Furthermore, the requirements for a request for verification make it more likely that a physician or provider will ultimately receive the guarantee of payment that a verification represents. This benefit should offset any additional requirement s add ed by this proposal. Providing additional information to the carrier upon the carrier´s request is optional on the part of the physician or provider and thus is not required by the rule.
Ms. Stokes has determined that there are no costs of compliance with those parts of the proposed sections that are not mandated by SB 418 for physicians and providers that qualify as small or micro businesses pursuant to Texas Government Code §2006.001. Because the additional information requirements include only information that the physician or provider may readily access, the effect of these requirements should be the same for small or large physicians and providers. The department believes that it is neither legal nor feasible to establish separate procedures or waive the verification request requirements for physicians or providers that are small or micro businesses. The requirements were proposed in an effort to create a verification process that will provide carriers with sufficient information to provide a greater number of verifications. This information is necessary without regard for the size of the requesting physician or provider.
In addition, the proposal requires a carrier that issues a verification or declination to provide certain stated information in writing to the requestor. Some of this information is required by the statute. Providing the remainder of the information can be absorbed into the statutorily required process and is necessary to ensure that both parties clearly understand what services were verified or declined. Therefore, there is no additional cost associated with these requirements. The written response may be delivered via a variety of methods, including fax, email, or U.S. mail. The benefits of a written response, avoiding post-verification disputes regarding what was actually verified, outweigh any potential burden associated with reducing this information to writing. The statute requires delivery of a determination in response to a request for verification and the department has simply enhanced these requirements to allow for a determination that is meaningful and reliable. The proposal also allows a carrier to request additional information in response to a request for verification. This should not result in additional costs as this process is optional.
Ms. Stokes has determined that there are no costs of compliance with those parts of the proposed sections that are not mandated by SB 418 for carriers that qualify as small or micro businesses pursuant to Texas Government Code §2006.001. The effect of these requirements should be the same for small or large carriers. The department believes that it is neither legal nor feasible to establish separate procedures for small carriers or waive the verification response requirements for carriers that are small or micro businesses. The written verification that results from the requirements is necessary for carriers without regard for the size of the entity.
To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on August 4, 2003 to Gene C. Jarmon, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104 , Austin , Texas 78714-9104 . An additional copy of the comment must be simultaneously submitted to Kimberly Stokes, Senior Associate Commissioner, Life, Health and Licensing Program, Mail Code 107-2A, Texas Department of Insurance, P.O. Box 149104 , Austin , Texas 78714-9104 .
The amendments/new sections are proposed under the Insurance Code Articles 3.70-3C, and §§36.001, 843.347 and 843.348. Article 3.70-3C provides for the processes of preauthorization and verification for preferred provider benefit plans. Section 36.001 provides that the Commissioner of Insurance may adopt rules necessary and appropriate to implement the powers and duties of the Texas Department of Insurance. Sections 843.347 and 843.348 provide for the processes of verification and preauthorization, respectively, for HMOs.
The following sections are affected by this proposal:
§§19.1703, 19.1723 and 19.1724 Article 3.70C and §§843.347
and 843.348
(9) Declination-- a response to a request for verification in which an HMO or preferred provider carrier declines to guarantee payment for proposed medical care or health care services prior to receiving a claim for the proposed services. A declination is not a determination that a claim resulting from the proposed services will not ultimately be paid.
(10) [(9)] Department--Texas Department of Insurance.
(11) [ (10) ] Dental plan--An insurance policy or health benefit plan, including a policy written by a company subject to the Insurance Code, Chapter 20, that provides coverage for expenses for dental services.
(12) [ (11) ] Dentist--A licensed doctor of dentistry, holding either a D.D.S. or a D.M.D. degree.
(13) [(12)] Emergency care--Health care services provided in a hospital emergency facility or comparable facility to evaluate and stabilize medical conditions of a recent onset and severity, including but not limited to severe pain, that would lead a prudent layperson possessing an average knowledge of medicine and health to believe that his or her condition, sickness, or injury is of such a nature that failure to get immediate medical care could result in:
(14) [ (13) ] Enrollee--A person covered by a health insurance policy or health benefit plan. This term includes a person who is covered as an eligible dependent of another person.
(15) [ (14) ] Health benefit plan--A plan of benefits that defines the coverage provisions for health care for enrollees offered or provided by any organization, public or private, other than health insurance.
(16) [ (15) ] Health care provider--Any person, corporation, facility, or institution licensed by a state to provide or otherwise lawfully providing health care services that is eligible for independent reimbursement for those services.
(17) [ (16) ] Health insurance policy--An insurance policy, including a policy written by a company subject to the Insurance Code, Chapter 20, that provides coverage for medical or surgical expenses incurred as a result of accident or sickness.
(18) [ (17) ] Inquiry--A request for information or assistance from a utilization review agent.
(19) [ (18) ] Life-threatening--A disease or condition for which the likelihood of death is probable unless the course of the disease or condition is interrupted.
(20) [ (19) ] Mental health medical record summary--A summary of process or progress notes relevant to understanding the patient's need for treatment of a mental or emotional condition or disorder such as:
(21) [ (20) ] Mental health therapist--Any of the following persons who, in the ordinary course of business or professional practice, diagnose, evaluate, or treat any mental or emotional condition or disorder:
(22) [ (21) ] Mental or emotional condition or disorder--A mental or emotional illness as detailed in the most current revision of the Diagnostic and Statistical Manual of Mental Disorders.
(23) [ (22) ] Nurse--A registered professional nurse, a licensed vocational nurse, or a licensed practical nurse.
(24) [ (23) ] Open records law--Government Code, Chapter 552.
(25) [ (24) ] Patient--An enrollee or an eligible dependent of the enrollee under a health benefit plan or health insurance plan.
(26) [ (25) ] Payor--An insurer writing health insurance policies; any preferred provider organization, health maintenance organization, self-insurance plan; or any other person or entity which provides, offers to provide, or administers hospital, outpatient, medical, or other health benefits to persons treated by a health care provider in this state pursuant to any policy, plan or contract.
(27) [ (26) ] Person--An individual, a corporation, a partnership, an association, a joint stock company, a trust, an unincorporated organization, any similar entity or any combination of the foregoing acting in concert.
(28) [ (27) ] Physician--A licensed doctor of medicine or a doctor of osteopathy.
[ (28) Practicing healthcare provider--A health care provider who is engaged in diagnosing, treating, and/or offering to treat any mental or physical disease or disorder or any physical deformity or injury or performing such actions with respect to individual patients. ]
(31) [ (29) ] Provider of record--The physician or other health care provider that has primary responsibility for the care, treatment, and services rendered to the enrollee or the physician or health care provider that is requesting or proposing to provide the care, treatment and services to the enrollee and includes any health care facility when treatment is rendered on an inpatient or outpatient basis.
(32) [ (30) ] Retrospective review--A system in which review of the medical necessity and appropriateness of health care services provided to an enrollee is performed for the first time subsequent to the completion of such health care services. Retrospective review does not include subsequent review of services for which prospective or concurrent reviews for medical necessity and appropriateness were previously conducted.
(33) [ (31) ] Screening criteria--The written policies, decision rules, medical protocols, or guides used by the utilization review agent as part of the utilization review process (e.g., appropriateness evaluation protocol (AEP) and intensity of service, severity of illness, discharge, and appropriateness screens (ISD-A)).
(34) [ (32) ] Utilization review--A system for prospective or concurrent review of the medical necessity and appropriateness of health care services being provided or proposed to be provided to an individual within the state. Utilization review shall not include elective requests for clarification of coverage.
(35) [ (33) ] Utilization review agent--An entity that conducts utilization review, for an employer with employees in this state who are covered under a health benefit plan or health insurance policy, a payor, or an administrator.
(36) [ (34) ] Utilization review plan--The screening criteria and utilization review procedures of a utilization review agent.
(37) Verification ­ a guarantee by an HMO or preferred provider carrier that the HMO or preferred provider carrier will pay for proposed medical care or health care services if the services are rendered within the required timeframe to the patient for whom the services are proposed. The term includes pre-certification, certification, re-certification and any other term that would be a reliable representation by an HMO or preferred provider carrier to a physician or provider if the request for the pre-certification, certification, re-certification, or representation includes the requirements of §19.1724(c) of this title (relating to Verification).
(38) [ (35) ] Working day--A weekday, excluding New Years Day, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day, and Christmas Day.
(a) An HMO or preferred provider carrier must be able to receive a request for verification of proposed medical care or health care services:
(3) by other means as agreed to by the preferred provider and the HMO or preferred provider carrier.
(b) An HMO or preferred provider carrier shall have appropriate personnel reasonably available at a toll-free telephone number to accept telephone requests for verification and to provide determinations of previously requested verifications between 6:00 a.m. and 6:00 p.m. central time Monday through Friday on each day that is not a legal holiday and between 9:00 a.m. and noon central time on Saturday, Sunday, and legal holidays. An HMO or preferred provider carrier must have a telephone system capable of accepting or recording incoming inquiries after 6:00 p.m. central time Monday through Friday and after noon central time on Saturday, Sunday, and legal holidays and responding to each of those calls not later than two calendar days after the call is received.
(c) Any request for verification shall contain the following information:
(2) patient ID number;
(3) patient address;
(4) patient date of birth;
(5) name of enrollee or subscriber;
(6) enrollee or subscriber ID number;
(7) enrollee or subscriber date of birth;
(8) patient relationship to enrollee or subscriber;
(9) initial diagnosis;
(10) procedure code(s);
(11) name and address of hospital or facility, if applicable;
(12) proposed date of service;
(13) name of employer, if applicable;
(14) group number, if applicable;
(15) name and contact information of any other carrier, if known, including the other carrier´s name, address and telephone number, name of enrollee, plan or ID number, group number (if applicable), and group name (if applicable);
(16) name of preferred provider providing the proposed services;
(17) preferred provider´s federal tax ID number; and
(18) place of service.
(d) Receipt of a written request or a written response to a request for verification under this section is subject to the provisions of §21.2816 of this title (relating to Date of Receipt).
(e) If necessary to verify proposed medical care or health care services, an HMO or preferred provider carrier may, within three days of receipt of the request for verification, request information from the preferred provider in addition to the information provided in the request for verification. An HMO or preferred provider carrier may make only one request for additional information from the requesting preferred provider under this section.
(f) A request for information under subsection (e) of this section must be in writing and must:
(g) On receipt of a request for verification from a preferred provider, the HMO or preferred provider carrier shall issue a verification or declination. An HMO or preferred provider carrier shall respond to requests for verification within the following time periods.
(1) Except as provided in paragraph (2) of this subsection, an HMO or preferred provider carrier shall provide a verification or declination in response to a request for verification without delay but not later than 15 days after the date of receipt of the request for verification.
(2) If the request is related to a concurrent hospitalization, post-stabilization care or a life-threatening condition, the response must be sent to the preferred provider without delay but not later than 72 hours after the HMO or preferred provider carrier received the request.
(h) A verification or declination may be delivered via telephone call or in writing. If the verification or declination is delivered via telephone call, the HMO or preferred provider carrier shall, within three calendar days of providing a verbal response, provide a written response which must include, at a minimum:
(9) if the request involved services for which preauthorization is required, a decision as to whether the proposed services are medically necessary and appropriate, as required in §19.1723 of this title (regarding Preauthorization); and
(10) a statement that the proposed services are being verified or declined pursuant to Title 28 Texas Administrative Code §19.1724.
(i) An HMO or preferred provider carrier that issues a verification may not deny or otherwise reduce payment to the preferred provider for those medical care or health care services if provided on or before the expiration date for the verification, which shall not be less than 30 days, unless the preferred provider has materially misrepresented the proposed medical or health care services or has substantially failed to perform the medical or health care services as verified.
(j) The provisions of this section apply to a physician or healthcare provider, other than a preferred provider described in §19.1703(31) of this title (relating to Definitions), that provides to an enrollee of an HMO or preferred provider carrier:
(2) specialty or other medical care or health care services at the request of the HMO, preferred provider carrier, or a preferred provider because the services are not reasonably available from a preferred provider who is included in the HMO or preferred provider carrier´s network.