HBA-TYH S.B. 1884 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 1884 By: Sibley Insurance 5/13/1999 Engrossed BACKGROUND AND PURPOSE Currently, the Health Care Liability Act (Act), passed by the legislature in 1997, allows an individual to sue a health insurance carrier, health maintenance organization, or managed care entity for damages resulting from the entity's failure to exercise ordinary care when making a health care treatment decision. In addition, the Act requires that an insured or enrollee submit a claim to an independent review organization before maintaining an action under the Act if the review is requested by the managed care entity. Case law has held that the independent review mechanism contained in the legislation is preempted by federal law as it relates to certain employee benefit plans governed by the Employee Retirement Income Security Act of 1974. This bill creates a separate voluntary independent review mechanism within the Health Care Liability Act of 1997, that would apply only at the request of a managed care entity to an insured or enrollee as long as the entity agrees to comply with certain provisions relating to independent reviews. As proposed, S.B. 1884 creates a separate voluntary independent review mechanism within the Health Care Liability Act of 1997, that would apply only at the request of a managed care entity to an insured or enrollee as long as the entity agrees to comply with certain provisions relating to independent reviews. 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 88.003, Civil Practice and Remedies Code, as added by Chapter 163, Acts of the 75th Legislature, Regular Session, 1997, to provide that a review conducted under this section as requested by a health insurance carrier, health maintenance organization, or managed care entity must be performed in accordance with Article 21.58C (Standards for Independent Review Organizations), Insurance Code. Provides that the health insurance carrier, health maintenance organization, or managed care entity requesting the review must agree to comply with Subdivisions (2), (3) and (4), Section 6A (Appeal of Adverse Determinations of Utilization Review Agents), Article 21.58A (Health Care Utilization Review Agents), Insurance Code. Makes conforming and nonsubstantive changes. SECTION 2. Effective date: September 1, 1999. SECTION 3. Makes application of this Act prospective. SECTION 4. Emergency clause.