HBA-ATS C.S.H.B. 1778 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 1778 By: Giddings Business & Industry 3/26/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE The Texas Workers' Compensation Commission (commission) develops and administers programs to contain or reduce medical and legal costs and to ensure overall system efficiency. Implementation of these programs requires the commission to create medical policies relating to necessary treatments for injuries and guidelines relating to the fees charged or paid for medical services used by employees, and to establish a review process to resolve disputes concerning medical services rendered by a health care provider. To help the commission carry out these duties, the Labor Code currently authorizes it to contract with a health care provider professional review organization or other entity to develop, maintain, or review the medical policies or fee guidelines, including the compliance with these policies and guidelines. In addition, the commission is authorized to contract with a health care provider for medical consultant services, including independent medical examinations and medical case reviews. Currently, the commission contracts for medical consultant services to help determine the appropriateness of medical care given to an injured employee when the commission lacks medical expertise. Relying on these entities is expensive and may lengthen the medical review process in a dispute. Moreover, other decisions made by the commission that affect the timeliness and cost associated with medical care provided to an injured employee, such as verifying the accuracy of an impairment rating, may suffer because of the commission's lack of medical expertise. C.S.H.B. 1778 requires the Texas Workers' Compensation Commission to employ a medical advisor to develop, maintain, and review medical policies and fee guidelines, to review compliance with those policies and guidelines, to perform other acts related to medical benefits as required by the commission, and to recommend, at least annually, the removal of doctors from the commission's list of approved doctors for any reason outlined in Section 408.023(b), Labor Code, or for noncompliance with any policies reviewed under proposed Section 413.0515. The advisor must be a doctor and the advisor may create a panel of health care providers to assist the advisor. Additionally, this bill includes a health care provider among the organizations with which the commission is authorized to contract to develop, maintain, or review medical policies or fee guidelines or to review compliance with the medical policies or fee guidelines. This bill also authorizes the commission to contract with a health care provider professional review organization or any other entity for medical consultant services. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 413.051, Labor Code, as follows: Sec. 413.051. CONTRACTS WITH REVIEW ORGANIZATIONS AND HEALTH CARE PROVIDERS. (a) Includes a health care provider among the organizations with which the Texas Workers' Compensation Commission (commission) is authorized to contract to develop, maintain, or review medical policies or fee guidelines or to review compliance with the medical policies or fee guidelines. (b) Makes conforming changes. (c) Includes a health care provider professional review organization and any other entity among the entities with which the commission is authorized to contract for medical consultant services. (d) Adds this subsection to require the commission to establish standards for contracts under this section. SECTION 2. Amends Subchapter E, Chapter 413, Labor Code, by adding Section 413.0515, as follows: Sec. 413.0515. MEDICAL ADVISORS. (a) Requires the commission to employ a medical advisor to develop, maintain, and review medical policies and fee guidelines, to review compliance with those policies and guidelines, to perform other acts related to medical benefits as required by the commission, and to recommend, at least annually, the removal of doctors from the commission's list of approved doctors under Section 408.023 (List of Approved Doctors) for any reason outlined in Section 408.023(b), or for noncompliance with any policies reviewed under this section. (b) Authorizes the medical advisor to create a panel of health care providers to assist the medical advisor. (c) Provides that a person who performs a function for the division of medical review has the same immunity from liability as a member of the commission under Section 402.010 (Civil Liability of Member). Provides that the person's actions do not constitute utilization review and are not subject to Article 21.58A (Health Care Utilization Review Agents), Insurance Code. (d) Specifies that the medical advisor must be a doctor as that term is defined by Section 401.011 (General Definitions). SECTION 3. Effective date: September 1, 1999. SECTION 4. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 1778 modifies the original bill by adding a new SECTION 1 which modifies existing Section 413.051 (Contracts with Review Organizations and Health Care Providers), Labor Code, to include a health care provider among the organizations with which the Texas Workers' Compensation Commission (commission) is authorized to contract to develop, maintain, or review medical policies or fee guidelines or to review compliance with the medical policies or fee guidelines. The substitute also includes a health care provider professional review organization and any other entity among the entities with which the commission is authorized to contract for medical consultant services, and requires the commission to establish standards for contracts under Section 413.051. C.S.H.B. 1778 modifies the original bill by redesignating proposed SECTION 1 as SECTION 2 and by modifying it. The substitute modifies the proposed addition of Section 413.0515 to the Labor Code by adding new Subdivisions (3) and (4) to include the performance of other acts related to medical benefits as required by the commission, and the recommendation, at least annually, of the removal of doctors from the commission's list of approved doctors under Section 408.023 for any reason outlined in Section 408.023(b), or for noncompliance with any policies reviewed under this section among the duties of the medical advisor required to be employed by the commission. The substitute also modifies the original bill by authorizing the medical advisor to create a panel of health care providers, rather than physicians, to assist the medical advisor, rather than assist the medical advisor in performing any review of medical policies and fee guidelines and review of compliance with those medical policies and fee guidelines. The substitute modifies the original bill by providing that a person who performs a function for the division of medical review has the same immunity from liability as a member of the commission under Section 402.010, and that the person's actions do not constitute utilization review and are not subject to Article 21.58A, Insurance Code. Previously, the original bill had provided that a medical advisor or any physician serving on a panel established by the advisor was immune from liability for any act done by that person in good faith and in that person's official capacity. The substitute modifies the original bill by specifying that the medical advisor must be a doctor. The original bill had provided that a medical advisor had to be a licensed individual who had extensive educational and clinical experience and training in health care, including diagnosis and treatment, surgical intervention, rehabilitation, and counseling of patients who have suffered an injury or disease.