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The House Committee on Insurance interim report to the 88th Legislature covers barriers to competition in the insurance market, freestanding emergency rooms, anti-rebating laws, and the impact of Rutledge v. Pharmaceutical Care Management Association and the federal No Surprises Act on the Texas insurance market. For more information see the full report here.

Spotlight on Recommendations

Charge 1. Monitor the agencies and programs under the Committee’s jurisdiction and oversee the implementation of relevant legislation passed by the 87th Legislature, including:

  • HB 18, relating to the establishment of the prescription drug savings program for certain uninsured individuals
    • While HB 18 can potentially be successful in reducing drug prices for uninsured people, it faces a few implementation challenges. The federal government programs that can provide the most significant cost offsets may not agree with Texas’s innovative approach, limiting access to lower drug prices. Additionally, after the passage of HB 18, various private ventures are attempting to find success in the affordable drug market. Legislative efforts to correct market failures have spotlighted the issue of drug pricing and spurred innovation and private enterprises to find market-oriented solutions complementing the legislature’s efforts.
    • The Committee will continue to monitor programs in other states which have been successful in providing cost savings to individuals who are in greatest need of costly, but essential, medications, such as the Kentucky Prescription Assistance Program.
    • The Committee will continue to monitor the progress of HB 18.
  • HB 3459, relating to preauthorization requirements for certain health care services and utilization review for certain health benefit plans
    • The Committee recognizes the unique aspects of HB 3459, and realizes that implementation of its policies must be carefully considered. The Committee will continue to monitor the progress of the implementation process in the near future.
  • HB 3752, relating to the offering of health benefit coverage by subsidiaries of the Texas Mutual Insurance Company
    • The Committee is encouraged by the testimony received concerning HB 3752. The Committee will continue to monitor its progress in the future.
  • HB 3924, relating to health benefits offered by certain nonprofit agricultural organizations
    • The Committee will continue to monitor the implementation and progress of HB 3924.
  • HB 2090, relating to the establishment of a statewide all payor claims database
    • The Committee is enthusiastic about the possibilities that APCD might offer in the years to come. The Committee will continue to support APCD as it was imagined, as a unique opportunity that will have the potential to positively change the lives of Texans for generations. The committee is encouraged by UT Health’s insistence that it will never become a vehicle for profit-making, and that UT Health will never put limitations on findings related to the data gathered from APCD.
  • SB 1137, relating to the required disclosure of prices for certain items and services provided by certain medical facilities
    • The Committee is pleased with the progress of SB 1137’s implementation and efficacy. It is the hope of the Committee that greater compliance will be achieved. The Committee will continue to monitor SB 1137, and will support future legislation that focuses on increased price transparency, which will ultimately protect all Texas patients.
  • SB 790, Relating to county and municipal authority to balance bill for county or municipal air or ground ambulance services and to a study regarding billing by ground ambulance service providers.
    • The Committee will continue to monitor the progress of SB 790.

Charge 2. Review existing state laws, administrative regulations, and agency practices to identify barriers to competition in the insurance marketplace. Examine existing business practices in the industry to determine if additional laws or regulations are needed to promote competition, lower premiums, and protect consumers.

  • Health Sharing Ministries: The Committee is enthusiastic about the possibility of third-party accreditation, and its ability to ensure that participants in Health Sharing Ministries are protected from bad actors. The Committee feels that, in light of recent issues involving another Health Sharing Ministry, that legislation requiring independent, third-party accreditation may be necessary to protect Texans participating in Health Sharing Ministries.
  • County Mutuals: The Committee believes that fair competition is necessary to ensure that a fair, robust marketplace exists. The Committee will continue to monitor this situation.
  • Farm Mutuals: The Committee understands that situations change, and metrics established in the past may or may not be applicable to current situations and standards. The Committee recommends that further study may be necessary in order to establish current, effective means of classifying regions as rural or urban, in order to find out if these classifications retain their relevance by today’s standards.
  • Appraisals: A consumer’s right to invoke appraisal in disputes regarding the cost of repairs or the amount of a total loss has been the market standard in Texas for both personal automobile and residential property insurance. The Committee will continue to monitor this situation.

Charge 3. Monitor the implementation, compliance, and enforcement of legislation related to freestanding emergency rooms to determine whether patients are adequately protected and if further safeguards and disclosures are needed.

  • Freestanding Emergency Rooms: The Committee is pleased by the effectiveness of recent legislation designed to protect patients, and is encouraged by efforts of members of the Freestanding Emergency Room community to self-police. The committee appreciates that the they understand that protecting patients is the number one priority, and hopes that they will continue on this path. Furthermore, the Committee hopes that legislation will not be needed in the future to correct problems created by bad actors in the community.

Charge 4. Review Texas’ insurance anti-rebating laws and model legislation related to rebates. Make recommendations for legislation that would preserve the purpose of the current statute while allowing certain services for and benefits to insurance consumers.

  • Anti-Rebating Laws: Ensuring that value-added products and services are not prohibited under Texas’s anti-rebating laws will help encourage insurers to provide these products and services to policyholders. Advances in technology, as well as creative approaches to minimizing the risk of loss to the benefit of both the policyholder and insurer, make this a opportune time to reevaluate this particular aspect of the anti-rebating statute. The Committee believes that just as these changes are necessitated by innovation, future products and services that fit under this umbrella should be not only allowed, but encouraged. Thus, the Committee recommends legislation similar to HB 3964 that removes confusion about the difference between offering value-added products and services that reduce risk, and unsound, higher-risk competitive strategies which have the potential to place a burden on responsible insurers.

Charge 5. Study the impacts of the U.S. Supreme Court’s 2020 decision in Rutledge v. Pharmaceutical Care Management Association and the federal No Surprises Act (2021 Consolidated Appropriations Act, Public Law No. 116-620) on the Texas insurance market.

  • The Committee is pleased to learn about the implementation progress and efficacy of both HB 1919 and HB 1763, and will continue to monitor them in the future.
  • Regarding the federal No Surprises Act, and its effect on the Texas market, the Committee understands that collectively we are either going to move in the direction of market-based competition, or government control. The Committee favors market-based solutions of the kind that have served Americans so well in nearly other sector of the economy for decades. The Committee feels that it will be important to remain vigilant as this transformation takes place to ensure that consumers are empowered, rather than government.
  • Regarding Rutledge v. PCMA, the Committee is pleased to learn about the ruling of the Supreme Court, which narrows the range of state regulations preempted by ERISA, and broadens those which are not. The Committee is optimistic that the removal of ERISA preemption uncertainty will empower state legislators to pursue legislation which will be positive for health policy and Texan health care consumers.