HBA-DMH H.B. 1562 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 1562
By: Thompson
Insurance
3/11/2001
Introduced



BACKGROUND AND PURPOSE 

Health care fraud and abuse are costing the national health care system
several billion dollars annually. Many losses occur in Medicare and
Medicaid programs, but private sector health benefit programs are also
affected by fraud.  One of the more common methods of health care fraud is
to bill for services not performed or to bill for more expensive services
than were actually provided.  House Bill 1562 sets forth requirements for
the investigation of insurance fraud and the business of insurance. 

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. 

ANALYSIS

House Bill 1562 amends the Insurance Code to authorize the insurance fraud
unit to receive, review, and investigate in a timely manner insurer
antifraud reports. The bill requires the insurance fraud unit to report
annually in writing, making the initial report not later than January 1,
2003, to the commissioner of insurance the number of cases completed and
any recommendations for new regulatory and statutory responses to the types
of fraudulent activities encountered by the insurance fraud unit.   

The bill requires an insurer to adopt an antifraud plan.  The bill
authorizes the insurer to annually file the antifraud plan with the
insurance fraud unit and specifies what the plan must include. The bill
establishes that provisions relating to immunity do not apply to a claim
made against a policy issued by a reinsurer. The bill requires an insurers
to provide a notice of penalty for false or fraudulent claims on a claim
form that is provided to certain claimants. 

The bill sets forth that certain persons are not subject to liability based
on reports or information concerning fraudulent insurance acts if the
reports or information are provided to an individual employed by or acting
on behalf of an insurer to detect and prevent fraudulent insurance acts. 

H.B. 1562 amends the Occupations Code to specify the activities that
constitute unprofessional conduct by a health care provider, and provides
that, in addition to other provisions of civil or criminal law, such acts
of unprofessional conduct constitute cause for the revocation or suspension
of a provider's license, permit, registration, certificate, or other
authority or other disciplinary action. 

EFFECTIVE DATE

September 1, 2001.