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Subchapter M. MANDATORY BENEFIT NOTICE REQUIREMENTS

28 TAC §§21.2101 - 21.2103, 21.2105 - 21.2106

The Texas Department of Insurance proposes amendments to §§21.2101 - 21.2103 and 21.2105 - 21.2106, concerning mandatory benefit notice requirements. The proposed amendments are necessary to implement legislation enacted by the 76 th Legislature in House Bill 1764 (HB 1764) which redesignated Insurance Code Article 21.53D as Article 21.53I and amended the law to comply with the notice requirements under the federal Women´s Health and Cancer Rights Act of 1998 (Act). The federal law was effective January 1, 1999, and requires that a notice regarding coverage for reconstructive surgery be sent to each enrollee of a health benefit plan that provides medical or surgical benefits with respect to a mastectomy, upon enrollment, and annually thereafter. The notice provides information to individuals who have had a mastectomy or may have a mastectomy concerning the benefits available under their health benefit plans for reconstructive surgery. The proposed amendment to §21.2101 specifies the effective date for the notice and requires providing a notice to the enrollee concerning health coverage for reconstructive surgery after mastectomy. The proposed amendment to §21.2102 adds nonprofit health corporation and reciprocal exchange to the definition of carrier, broadens the definition of enrollee, addresses documents concerning multiple employer welfare arrangements and clarifies that the definition of health benefit plan that pertains to reconstructive surgery after mastectomy does not include certain plans. The proposed amendment to §21.2103 advises the carrier as to which notices are required to be issued concerning reconstructive surgery after mastectomy. The proposed amendment to §21.2105 sets forth the occasions upon which the carrier is to send the notices. The proposed amendment to §21.2106 sets forth the language of the prescribed notices and renumbers existing forms. The proposed amendments also make other clarifying changes for consistency and readability.

Kim Stokes, Senior Associate Commissioner, Life, Health and Licensing, has determined that for each year of the first five years the proposed amendments are in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the proposed amendments. There will be no effect on local employment or the local economy.

Ms. Stokes has determined that for each year of the first five years the proposed amendments are in effect, the anticipated public benefit as a result of the proposed amendments will be that affected enrollees are notified on a timely basis of benefits for reconstructive surgery after mastectomy. It is estimated that the majority, if not all, of the costs to comply with these proposed amendments are the result of the federal enactment of the Act and the legislative enactment of HB 1764, which amended Article 21.53I to comply with the Act. To the extent that any cost is imposed upon carriers by the proposed amendments, such cost is attributed to the inclusion of the prohibition section in the enrollment notice, which may add an additional page. It is estimated that the time to prepare, copy and mail an additional page to the notice would cost approximately $1.25 per notice. The actual total cost to each carrier will vary depending on the number of enrollees to whom the enrollment and/or annual notice must be sent, and, for group health benefit plans, whether the notice is sent to the group master contract holder, or directly to the enrollees. In an effort to minimize costs, carriers may deliver the enrollment and/or annual notice with other plan documents rather than in a separate mailing. It is the department´s position that the proposed amendments will not have an adverse economic effect on small businesses or micro-businesses. The costs to a small business and a large business depend upon the number of enrollees who will be provided with the enrollment and/or annual notice. Assuming that a small business and the largest business administered health benefit plans with approximately the same number of enrollees who will be given the enrollment and/or annual notice, the cost per hour of labor would not vary between the small and large businesses. Regardless of the fiscal effect, the enrollment and annual notices are mandated by federal and state statutes, and considering the statutes' purposes, it is neither legal nor feasible to waive or modify the requirements of the amendments for small and micro businesses, as doing so would allow differentiation of enrollment and/or annual notices between the insureds/enrollees of small businesses or micro-businesses compared to those enrollment and/or annual notices provided to the insureds/enrollees of large businesses.

To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on December 4, 2000 to Lynda H. Nesenholtz, 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 submitted simultaneously to Diane Moellenberg, Chief Director, Regulatory Development, Mail Code 107-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. Any requests for a public hearing should be submitted separately to the Office of the Chief Clerk.

The amendments are proposed under the Insurance Code Articles 21.53I, 3.51-6, 3.70-1, 3.95-15, 20A.22, 26.04 and §36.001. Article 21.53I provides that the commissioner may adopt rules to implement the article and to meet the minimum requirements of federal law. Article 3.51-6, §5 authorizes the department to issue such rules as may be necessary to carry out the various provisions of the article. Article 3.70-1(D) authorizes the department to issue such reasonable rules as may be necessary to carry out the various purposes and provisions of the article. Article 3.95-15(a) directs the commissioner to adopt rules as necessary to carry out the provisions of the subchapter and meet the minimum requirements of federal law and regulations. Article 20A.22(c) authorizes the commissioner to promulgate such reasonable rules as are necessary and proper to meet the requirements of federal law and regulations. Article 26.04 directs the commissioner to adopt rules as necessary to meet the minimum requirements of federal law and regulations. Section 36.001 provides that the commissioner may adopt rules for the conduct and execution of the powers and duties of the department only as authorized by statute.

The following articles are affected by this proposal: Insurance Code Articles 21.53I, 3.51-6, 21.2105 - 21.2106 3.70-1, 3.95, Chapters 20A and 26

§21.2101. Scope. The purpose of this subchapter is:

(1) to require notice to enrollees in a health benefit plan of coverage and/or benefits for prostate cancer examinations ; [ ,] minimum inpatient stays for maternity and childbirth ; [ ,] minimum inpatient stays for mastectomy or lymph node dissection; and reconstructive surgery after mastectomy [ and/or mastectomies]. With the exception of notice for reconstructive surgery after mastectomy, §§[ Sections] 21.2102 through 21.2106 of this subchapter apply to all carriers issuing, delivering , or renewing health benefit plans as defined in this subchapter as of January 1, 1998. For state notice requirements pertaining to reconstructive surgery after mastectomy, §§21.2102 - 21.2106 of this subchapter apply to all carriers issuing, delivering, or renewing health benefit plans as defined in this subchapter as of June 18, 1999.

(2) (No change.)

§21.2102. Definitions. The following words and terms, when used in this subchapter shall have the following meanings, unless the context clearly indicates otherwise.

(1) Carrier--An insurance company, a group hospital service corporation, a fraternal benefit society, a stipulated premium insurance company, a health maintenance organization, [ or] a multiple employer welfare arrangement that holds [ has] a certificate of authority under Insurance Code [ , ] Article 3.95-2 , or an approved nonprofit health corporation that holds a certificate of authority issued by the commissioner under Insurance Code Article 21.52F. In addition, for the purposes of paragraph (3)(B) of this subsection, the term also includes a reciprocal exchange operating under Insurance Code Chapter 19.

(2) Enrollee-- A person [ An individual who is] enrolled in and entitled to coverage under a health benefit plan, including covered dependents.

(3) Health benefit plan--Subject to subparagraphs (A), (B) , [ and] (C) , and (D) of this paragraph, a plan that is offered by a carrier and provides benefits for medical or surgical expenses incurred as a result of a health condition, accident, or sickness including an individual, group, blanket or franchise insurance policy or insurance agreement, a group hospital service contract, [ or] an individual or group evidence of coverage , or any similar coverage document. The term does not include a plan that provides coverage only for accidental death or dismemberment, disability income, supplement to liability insurance, Medicare supplement, workers' compensation, medical payment insurance issued as a part of a motor vehicle insurance policy or a long-term care policy.

(A) For the inpatient mastectomy coverage notice required by subsection (a)(1) of §21.2103 of this title (relating to Mandatory Benefit Notices), the definition of health benefit plan includes a plan that provides coverage only for a specific disease or condition for the treatment of breast cancer or for hospitalization. The term does not include a small employer health benefit plan issued under the Insurance Code[ ,] Chapter 26, Subchapters A-G.

(B) For the reconstructive surgery after mastectomy notices required by subsection (a)(2) of §21.2103 of this title, the definition of health benefit plan does not include a plan that provides coverage for a specified disease or other limited benefit except for cancer, a plan that provides only credit insurance, a plan that provides coverage only for dental or vision care, or only for indemnity for hospital confinement.

(C) [ (B)] For the prostate cancer examination notice required by subsection (a)(3) [ (a)(2)] of §21.2103 of this title [ (relating to Notices)], the definition of health benefit plan does not include a small employer health benefit plan written under the Insurance Code Chapter 26, Subchapters A-G, a plan [ or plans] that provides [ provide] coverage only for a specified disease or other limited benefit , or only for indemnity for hospital confinement [ hospitalization].

(D) [ (C)] For the inpatient maternity and childbirth coverage notice required by subsections (a)(4) [ (a)(3)] and (5) [ (4)] of §21.2103 of this title [ (relating to Notices)], the definition of health benefit plan does not include a plan that provides only credit insurance, a plan [ or plans] that provides [ provide] coverage only for a specified disease or other limited benefit [ benefits], only for dental or vision care, or only for indemnity for hospital confinement.

(4) Other limited benefit--A plan that provides coverage singularly or in combination, for benefits for a specifically named disease, accident or combination of diseases or accidents, including but not limited to heart attack, stroke, AIDS, and travel, farm or occupational accident.

(5) Primary Enrollee--For group coverage, the covered member or employee of the group. For individual coverage, the person first named on the application/enrollment form.

§21.2103. Mandatory Benefit Notices.

(a) Prescribed mandatory benefit notices consist of the following:

(1) For a health benefit plan that provides coverage and/or benefits for the treatment of breast cancer, a carrier shall issue a notice which includes the language provided in Figure 1 of subsection (b) of §21.2106 of this title (relating to Forms, Form Number 349 Mastectomy).

(2) For a health benefit plan that provides coverage and/or benefits for a mastectomy, a carrier shall issue:

(A) an enrollment notice which includes the language provided in Figure 2 of subsection (b) of §21.2106 of this title (relating to Forms, Form Number 1764 Reconstructive Surgery After Mastectomy-Enrollment); and

(B) an annual notice, which includes either:

(i) the language provided in Figure 3 of subsection (b) of §21.2106 of this title (relating to Forms, Form Number 1764 Reconstructive Surgery After Mastectomy-Annual); or

(ii) the language provided in Figure 2 of subsection (b) of §21.2106 of this title (relating to Forms, Form Number 1764 Reconstructive Surgery after Mastectomy-Enrollment).

(3) [( 2)] For a health benefit plan that provides coverage and/or benefits for diagnostic medical procedures, a carrier shall issue a notice which includes the language provided in Figure 4 [ 2] of subsection (b) of §21.2106 of this title (relating to Forms, Form Number 258 Prostate).

(4) [ (3)] For a health benefit plan that provides coverage and/or benefits for maternity, including benefits for childbirth, a carrier shall issue a notice which includes the language provided in Figure 5 [ 3] of subsection (b) of §21.2106 of this title (relating to Forms, Form Number 102 Maternity).

(5) [ (4)] If the health benefit plan described in paragraph 4 [ (3)] of this subsection includes benefits and/or coverage for in-home postdelivery care, the following language, or substantially similar language, shall be inserted immediately before the "Prohibitions" portion of the notice language at Figure 5 [ 3] of subsection (b) of §21.2106 of this title (relating to Forms): "Since we provide in-home postdelivery care, we are not required to provide the minimum number of hours outlined above unless (a) the mother's or child's physician determines the inpatient care is medically necessary or (b) the mother requests the inpatient stay."

(b) In lieu of the prescribed notices outlined in subsection (a) of this section, a carrier may opt to provide notices with substantially similar language rather than the notices contained in subsection (b) of §21.2106 of this title. The substantially similar language must be in a readable and understandable format, and must include a clear, complete , and accurate description of these items in the following order:

(1) a heading in bold print and all capital letters indicating the information in the notice relates to mandated benefits;

(2) a statement that the notice is being provided to advise the enrollee of the appropriate coverage and/or benefits [ coverage(s)/benefit(s)], including the carrier's complete licensed name;

(3) a heading in bold print describing the coverage and/or benefits [ benefit/ coverage] being provided, for example, Examinations for Detection of Prostate Cancer;

(4) a description of the coverage and/or benefits [ benefit/ coverage] for which the notice is being provided . [ ;] For a carrier who issues a health benefit plan that provides coverage and/or benefits for a mastectomy, the following shall also apply:

(A) the enrollment notice required by subsection (a)(2)(A) of this section shall disclose that the coverage and/or benefits shall be provided in a manner determined to be appropriate in consultation with the attending physician and the enrollee and shall state the specific deductibles, copayments and/or coinsurance, which may not be greater than the deductibles, copayments and/or coinsurance applicable to other benefits under the health benefit plan; and

(B) the annual notice required by subsection (a)(2)(B) of this section shall at a minimum describe that the health benefit plan provides coverage and/or benefits for reconstructive surgery after mastectomy, surgery and reconstruction of the other breast for symmetry, prostheses and treatment of complications resulting from a mastectomy (including lymphedema).

(5) for the notice required by subsection [ subsections] (a)(1) , (2)(A) and (4) [ (3)] of this section, the heading "Prohibitions" in bold print, followed by a summary of the prohibited acts by a carrier in providing the coverage and/or benefits [ benefit/ coverage] for which the notice is being provided; and

(6) a statement identifying the carrier, and providing a phone number and address to which an enrollee may direct questions regarding the coverage and/or benefits [ coverage(s)/benefit(s)] for which the notice is being provided.

(c) If a health benefit plan provides coverage and/or benefits of more than one of the required notices described in subsection (a) of this section, the carrier may combine the language of the required notices into one notice.

(d) If, before the effective date of the amendments to this subchapter relating to reconstructive surgery after mastectomy [ these rules], a carrier has provided to its enrollees notice(s) [ to its enrollees] that contains the information concerning reconstructive surgery after mastectomy as required by §21.2103(a)(2) or (b) of this subchapter [ required by the notices described in this subchapter], such notice(s) [ notices] shall be deemed to comply with the requirements of this subchapter as to those enrollees.

§21.2105. Delivery of Mandatory Benefit Notices.

(a) The notices required by §21.2103 (a)(1), (3) and (4) of this title (relating to Mandatory Benefit Notices) shall be issued to enrollees of a health benefit plan that is delivered, issued for delivery, or renewed on or after January 1, 1998, and shall be provided according to the following paragraphs:

(1) The notice shall be provided:

(A) within 60 days of March 29, 1998 [ the effective date of this subchapter] to enrollees whose plans were renewed or issued between January 1, 1998 and March 29, 1998 [ the effective date of this subchapter];

(B) within 60 days of enrollment to new enrollees, whether in a newly issued or newly delivered health benefit plan, or an existing plan which is renewed after March 29, 1998 [ the effective date of this subchapter]; or

(C) within 60 days of renewal date to existing enrollees of an existing plan which is renewed after March 29, 1998 [ the effective date of this subchapter].

(2)-(6) (No change.)

(b) The notices required by §21.2103(a)(2) of this title shall be issued to enrollees of a health benefit plan and shall be provided according to the following paragraphs.

(1) The enrollment notice required by §21.2103(a)(2)(A) of this title shall be issued to each enrollee upon enrollment in the health benefit plan.

(2) The annual notice required by §21.2103(a)(2)(B) of this title shall be issued to each enrollee annually.

(3) Notwithstanding §21.2103(a)(2) of this title, a carrier may elect to issue the enrollment notice required by §21.2103(a)(2)(A) to satisfy the annual notice requirements set forth in §21.2103(a)(2)(B).

§21.2106. Forms.

(a) The forms identified in §21.2103 of this title (relating to Mandatory Benefit Notices) for notices of mandatory benefits are included in subsection (b) of this section in their entirety and have been filed with the Office of the Secretary of State. The forms can be obtained from the Texas Department of Insurance, Life/Health Division [ Group], MC 106-1A, P.O. Box 149104, Austin, Texas 78714-9104, or from the department´s Web site, www.tdi.state.tx.us.

(b) The forms referenced in this chapter are as follow:

(1) Figure Number 1: Form Number 349 Mastectomy:

NOTICE OF CERTAIN MANDATORY BENEFITS

This notice is to advise you of certain coverage and/or benefits [ coverages/benefits] provided by your contract with [name of carrier].

Mastectomy or Lymph Node Dissection

Minimum Inpatient Stay: If due to treatment of breast cancer, any person covered by this plan has either a mastectomy or a lymph node dissection, this plan will provide coverage for inpatient care for a minimum of:

(a) 48 hours following a mastectomy, and

(b) 24 hours following a lymph node dissection.

The minimum number of inpatient hours is not required if the covered person [ individual] receiving the treatment and the attending physician determine that a shorter period of inpatient care is appropriate.

Prohibitions: We may not (a) deny any covered person eligibility or continued eligibility or fail to renew this plan solely to avoid providing the minimum inpatient hours; (b) provide money payments or rebates to encourage any covered person to accept less than the minimum inpatient hours; (c) reduce or limit the amount paid to the attending physician, or otherwise penalize the physician, because the physician required a covered person to receive the minimum inpatient hours; or (d) provide financial or other incentives to the attending physician to encourage the physician to provide care that is less than the minimum hours.

If any person covered by this plan has questions concerning the above, please call [name of carrier] at [customer service or related department phone number], or write us at [carrier´s customer service or related department address].

Form Number 349 Mastectomy

(2) Figure Number 2: Form Number 1764 Reconstructive Surgery After Mastectomy-Enrollment:

NOTICE OF CERTAIN MANDATORY BENEFITS

This notice is to advise you of certain coverage and/or benefits provided by your contract with [name of carrier].

Coverage and/or Benefits for Reconstructive Surgery After Mastectomy-Enrollment

Coverage and/or benefits are provided to each covered person for reconstructive surgery after mastectomy, including:

(a) all stages of the reconstruction of the breast on which mastectomy has been performed;

(b) surgery and reconstruction of the other breast to achieve a symmetrical appearance; and

(c) prostheses and treatment of physical complications, including lymphedemas, at all stages of mastectomy.

The coverage and/or benefits must be provided in a manner determined to be appropriate in consultation with the covered person and the attending physician.

[Include any specific deductibles, copayments, and/or coinsurance applicable to the coverage and/or benefits, which may not be greater than the deductibles, copayments and/or coinsurance applicable to other coverage and/or benefits under the health benefit plan.]

Prohibitions: We may not (a) offer the covered person a financial incentive to forego breast reconstruction or waive the coverage and/or benefits shown above; (b) condition, limit, or deny any covered person´s eligibility or continued eligibility to enroll in the plan or fail to renew this plan solely to avoid providing the coverage and/or benefits shown above; or (c) reduce or limit the amount paid to the physician or provider, nor otherwise penalize, or provide a financial incentive to induce the physician or provider to provide care to a covered person in a manner inconsistent with the coverage and/or benefits shown above.

If any person covered by this plan has questions concerning the above, please call [name of carrier] at [customer service or related department phone number], or write us at [carrier´s customer service or related department address].

Form Number 1764 Reconstructive Surgery After Mastectomy-Enrollment

(3) Figure Number 3: Form Number 1764 Reconstructive Surgery After Mastectomy-Annual:

NOTICE OF CERTAIN MANDATORY BENEFITS

This notice is to advise you of certain coverage and/or benefits provided by your contract with [name of carrier].

Coverage and/or Benefits for Reconstructive Surgery After Mastectomy-Annual

Your contract, as required by the federal Women´s Health and Cancer Rights Act of 1998, provides benefits for mastectomy-related services including reconstruction and surgery to achieve symmetry between the breasts, prostheses, and complications resulting from a mastectomy (including lymphedema).

If any person covered by this plan has questions concerning the above, please call [name of carrier] at [customer service or related department phone number], or write us at [carrier´s customer service or related department address].

Form Number 1764 Reconstructive Surgery After Mastectomy-Annual

(4) [( 2)] Figure Number 4 [ 2]: Form Number 258 Prostate:

NOTICE OF CERTAIN MANDATORY BENEFITS

This notice is to advise you of certain coverage and/or benefits [ coverages/benefits] provided by your contract with [name of carrier [ issuer]].

Examinations for Detection of Prostate Cancer

Benefits are provided for each covered male for an annual medically recognized diagnostic examination for the detection of prostate cancer. Benefits include:

(a) a physical examination for the detection of prostate cancer; and

(b) a prostate-specific antigen test for each covered male who is

(1) at least 50 years of age; or

(2) at least 40 years of age with a family history of prostate cancer or other prostate cancer risk factor.

If any person covered by this plan has questions concerning the above, please call [name of carrier] at [customer service or related department phone number], or write us at [carrier´s customer service or related department address].

Form Number 258 [ 259] Prostate

(5) [ (3)] Figure Number 5 [ 3]: Form Number 102 Maternity : [ .]

NOTICE OF CERTAIN MANDATORY BENEFITS

This notice is to advise you of certain coverage and/or benefits [ coverages/benefits] provided by your contract with [name of carrier].

Inpatient Stay following Birth of a Child

For each person covered for maternity/childbirth benefits, we will provide inpatient care for the mother and her newborn child in a health care facility for a minimum of:

(a) 48 hours following an uncomplicated vaginal delivery, and

(b) 96 hours following an uncomplicated delivery by cesarean section.

This benefit does not require a covered female who is eligible for maternity/childbirth benefits to (a) give birth in a hospital or other health care facility or (b) remain in a hospital or other health care facility for the minimum number of hours following birth of the child.

If a covered mother or her newborn child is discharged before the 48 or 96 hours has expired, we will provide coverage for postdelivery care. Postdelivery care includes parent education, assistance and training in breast-feeding and bottle-feeding and the performance of any necessary and appropriate clinical tests. Care will be provided by a physician, registered nurse or other appropriate licensed health care provider, and the mother will have the option of receiving the care at her home, the health care provider´s office or a health care facility.

[ In-home postdelivery care language, if applicable, is to be inserted here.]

Prohibitions. We may not (a) modify the terms of this coverage based on any covered person requesting less than the minimum coverage required; (b) offer the mother financial incentives or other compensation for waiver of the minimum number of hours required; (c) refuse to accept a physician´s recommendation for a specified period of inpatient care made in consultation with the mother if the period recommended by the physician does not exceed guidelines for prenatal care developed by nationally recognized professional associations of obstetricians and gynecologists or pediatricians; (d) reduce payments or reimbursements below the usual and customary rate; or (f) penalize a physician for recommending inpatient care for the mother and/or [ or] the newborn child.

If any person covered by this plan has questions concerning the above, please call [name of carrier] at [customer service or related department phone number], or write us at [carrier´s customer service or related department address].

Form Number 102 Maternity



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