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You are here: Home . rules . 2009 . 0729-059

Subchapter R. UTILIZATION REVIEW AGENTS

28 TAC §19.1722

1. INTRODUCTION.

The Texas Department of Insurance proposes amendments to §19.1722, relating to the Utilization Review Advisory Committee. The proposed amendments are necessary to re-establish a Utilization Review Advisory Committee pursuant to the Insurance Code §4201.003. Section 4201.003 requires the Commissioner to appoint an advisory committee to advise the Commissioner on development of rules regarding the administration of Chapter 4201, as authorized by the Government Code §2001.031. The Utilization Review Advisory Committee previously established and operated pursuant to existing §19.1722 automatically terminated on December 31, 1998, pursuant to §19.1722(e). It is necessary to establish a new committee because of the enactment of House Bill (HB) 4290, 81st Legislature, Regular Session, effective September 1, 2009. HB 4290 enacts changes to the Insurance Code Chapter 4201 that result in the need to substantively revise 28 TAC Chapter 19, Subchapter R, relating to the regulation of utilization review agents. HB 4290 expands the definition of "utilization review" in the Insurance Code Chapter 4201 to include retrospective reviews for medical necessity and to include reviews to determine the experimental or investigational nature of health care services. Rules are necessary to implement this expanded definition of "utilization review" as well as the other changes to the Insurance Code Chapter 4201 enacted by HB 4290 to address and implement the expanded definition of "utilization review." In addition, the Department may determine that other changes and additions are needed to the existing rules regulating utilization review.
The Government Code, Chapter 2110 specifies the requirements and procedures for state agency advisory committees. The Government Code §2110.0012 provides that a state agency has established an advisory committee if state or federal law has specifically created the committee to advise the agency or the agency has, under state or federal law, created the committee to advise the agency. The Government Code §2110.005 requires a state agency that establishes an advisory committee to, by rule, state the purpose and tasks of the committee and describe the manner in which the committee will report to the agency. The Government Code §2110.008 authorizes a state agency that has established an advisory committee to designate the date on which the committee will automatically be abolished and requires that the designation be by rule.
The following amendments are proposed to §19.1722. A proposed amendment to §19.1722(a) is necessary to clarify that the use of the term "advisory committee" throughout the section is a reference to the Utilization Review Advisory Committee.
Amendments are proposed to update obsolete statutory references in §19.1722(a), and (d) as a result of the adoption of the non-substantive Insurance Code revision. The Insurance Code Article 21.58A, which is referenced in §19.1722(a), was repealed in the non-substantive Insurance Code revision, Acts 2005, 79th Leg., Ch. 727, § 4, effective April 1, 2007. The Insurance Code Article 21.58A was readopted without substantive change as the Insurance Code Chapter 4201 in the same non-substantive Insurance Code revision. The Insurance Code Article 21.58A, §13, which is cited in §19.1722(d), was readopted as the Insurance Code §4201.003 as part of the non-substantive Insurance Code revision. Additionally, amendments are proposed to change references to "Insurance Code" to "the Insurance Code" throughout the section to reflect current agency style.
A proposed amendment to §19.1722(b)(1) establishes that the purpose of the advisory committee is to: (i) advise the Commissioner on the development of rules determined by the Department as necessary to implement HB 4290, 81st Legislature, Regular Session, effective September 1, 2009, that amends the Insurance Code Chapter 4201; and (ii) to advise the Commissioner on other changes and additions to the existing rules regulating utilization review that the Department determines are needed to administer the Insurance Code Chapter 4201.
A proposed amendment to §19.1722(c)(1) is necessary to provide that the advisory committee shall review and evaluate proposed changes and additions to the current utilization review. A proposed amendment to §19.1722(c)(2) is necessary to provide that the advisory committee shall advise and consult with the Commissioner or the Commissioner's representative during its review and evaluation made pursuant to §19.1722(c)(1). Proposed amendments also delete §19.1722(c)(3), which is no longer needed, and redesignate existing §19.1722(c)(4) as §19.1722(c)(3). Another proposed amendment to newly designated §19.1722(c)(3) is necessary to provide that the advisory committee shall perform other tasks related to the development of rules as provided by §19.1722(c)(1) and as requested by the Commissioner pursuant to the Insurance Code Chapter 4201 and the Government Code Chapter 2110.
Proposed amendments to §19.1722(d) and §19.1722(d)(1) are necessary to add two additional representatives to the utilization review advisory committee. The additional representatives are: (i) a representative for a workers' compensation carrier and (ii) a representative for injured employees. The addition of these two representatives is necessary because when §4201.003 of the Insurance Code was first enacted as Article 21.58A §13 in 1991, workers' compensation coverage was not subject to the utilization review requirements in the Insurance Code. In 1997, the Texas Legislature required workers' compensation coverage to be subject to the utilization review requirements of the Insurance Code Article 21.58A (HB 3197, 75th Legislature, Regular Session, effective September 1, 1997). As previously indicated, the Insurance Code Article 21.58A was repealed in the non-substantive Insurance Code revision, Acts 2005, 79th Leg., Ch. 727, § 4, effective April 1, 2007, and was readopted without substantive change as the Insurance Code Chapter 4201 in the same non-substantive Insurance Code revision. Pursuant to the Insurance Code §4201.054, the Insurance Code Chapter 4201 applies to utilization review of a health care service provided to a person eligible for workers' compensation medical benefits under Title 5, Labor Code. These additions are also consistent with the Government Code §2110.002(b), which provides that the composition of an advisory committee that advises a state agency regarding an industry or occupation regulated or directly affected by the agency must provide a balanced representation between the industry or occupation and consumers of services provided by the agency, industry, or occupation. The addition of these two representatives is permissible under the Insurance Code §4201.003, which provides that the utilization review advisory committee "includes" the representatives named within the section. Pursuant to the Government Code §311.005(13), the term "includes" is a term of enlargement and not of limitation or exclusive enumeration, and use of the term does not create a presumption that components not expressed are excluded. Therefore, the Insurance Code §4201.003 does not prohibit the inclusion of necessary industry and consumer representatives in the utilization review advisory committee merely because they are not expressly listed in the Insurance Code §4201.003. Additionally, it is necessary to amend §19.1722(d)(1) to clarify that the reference in existing §19.1722(d)(1) to one representative for a "consumer group" is actually referring to one representative for a "health coverage consumer group." This reference in existing §19.1722(d)(1) could result in confusion because it does not specify the type of consumer group.
Proposed new §19.1722(e) addresses reporting requirements of the committee. The subsection provides that after completion of review and evaluation of proposed changes and additions to the current utilization review rules in 28 TAC Chapter 19, Subchapter R, or completion of any other tasks in accordance with §19.1722(c)(3), the advisory committee shall submit a report of its recommendations to the Commissioner. Existing §19.1722(e) is redesignated as §19.1722(f).
Under the proposed amendment to newly designated §19.1722(f), the advisory committee shall automatically terminate on December 31, 2010, unless, before its termination, the Commissioner extends its duration by rule.

2. FISCAL NOTE. Debra Diaz-Lara, Deputy Commissioner, Health and Workers' Compensation Network Certification and Quality Assurance Division, has determined that for each year of the first five years the proposed amendments to §19.1722 are in effect, there will be no fiscal implications to state and local governments as a result of the enforcement or administration of the proposed amendments. There will be no measurable effect on local employment or the local economy as a result of this proposal.

3. PUBLIC BENEFIT/COST NOTE. Ms. Diaz-Lara also has determined that for each year of the first five years the proposed amendments to §19.1722 are in effect, the anticipated public benefit will be agency compliance with (i) the Insurance Code §4201.003, which requires the Commissioner to appoint an advisory committee to advise the Commissioner on development of rules regarding the administration of Chapter 4201; and (ii) the Government Code Chapter 2011, which specifies the requirements and procedures for state agency advisory committees. Other public benefits include the availability of an advisory committee (i) to advise the Commissioner on the development of rules to implement HB 4290, 81st Legislature, Regular Session, effective September 1, 2009, that amends the Insurance Code Chapter 4201; and (ii) to perform such other functions related to the development of these rules as requested by the Commissioner pursuant to the Insurance Code Chapter 4201 and the Government Code Chapter 2110. There are no persons required to comply with the proposed amendments because participation on the advisory committee is voluntary. Therefore, there are no costs for required compliance with the proposed amendments. Although participation on the advisory committee is voluntary, committee members who must travel to attend meetings will incur some out-of-pocket costs that will not be reimbursed by the Department. These costs will vary depending on how far the member must travel to attend meetings, what type of transportation is used, whether lodging is needed, and what choice of lodging is made.

4. ECONOMIC IMPACT STATEMENT AND REGULATORY FLEXIBILITY ANALYSIS FOR SMALL AND MICRO BUSINESSES. In accordance with the Government Code §2006.002(c), the Department has determined that the proposed amendments to §19.1722, relating to the Utilization Review Advisory Committee, will not have an adverse economic effect on small and micro businesses because participation on the advisory committee is voluntary, and a representative of a small business or micro business can opt to participate or not participate based on the representative's analysis of estimated costs for travel and lodging. In accordance with the Government Code §2006.002(c), the Department has, therefore, determined that because the proposal will not have an adverse impact on small or micro businesses, a regulatory flexibility analysis is not required.

5. TAKINGS IMPACT ASSESSMENT. The Department has determined that no private real property interests are affected by this proposal and that this proposal does not restrict or limit an owner's right to property that would otherwise exist in the absence of government action and, therefore, does not constitute a taking or require a takings impact assessment under the Government Code §2007.043.

6. REQUEST FOR PUBLIC COMMENT. To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on September 14, 2009, to Gene C. Jarmon, 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 simultaneously submitted to Debra Diaz-Lara, Deputy Commissioner, Health and Workers' Compensation Network Certification and Quality Assurance Division, Mail Code 103-6A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. Any request for a public hearing should be submitted separately to the Office of the Chief Clerk before the close of the public comment period. If a hearing is held, written and oral comments presented at the hearing will be considered.

7. STATUTORY AUTHORITY. The amendments are proposed under the Government Code §§2110.002, 2110.005, 2110.008, and 2110.0012, and the Insurance Code §4201.003 and §36.001. The Government Code §2110.002(b) provides that the composition of an advisory committee that advises a state agency regarding an industry or occupation regulated or directly affected by the agency must provide a balanced representation between the industry or occupation and consumers of services provided by the agency, industry, or occupation. The Government Code §2110.005 requires a state agency, when it establishes an advisory committee, to adopt rules that state the purpose and tasks of the advisory committee and that describe the manner in which the advisory committee will report to the agency. Section 2110.008(a) provides that a state agency that has established an advisory committee may designate the date on which the committee will automatically be abolished, that the designation must be by rule, and that the committee may continue in existence after that date only if the agency amends the rule to provide for a different abolishment date. The Government Code §2110.0012 provides that a state agency has established an advisory committee if state or federal law has specifically created the committee to advise the agency or if the agency has, under state or federal law, created the committee to advise the agency. The Insurance Code §4201.003(a) authorizes the Commissioner to adopt rules to implement Insurance Code Chapter 4201. The Insurance Code §4201.003(c) requires the Commissioner to appoint an advisory committee to advise the Commissioner on development of rules regarding the administration of Chapter 4201 and specifies the duties and composition of the advisory committee. The Insurance Code §36.001 provides that the Commissioner of Insurance may adopt any rules necessary and appropriate to implement the powers and duties of the Texas Department of Insurance under the Insurance Code and other laws of this state.

8. CROSS REFERENCE TO STATUTE. The following statutes are affected by this proposal:

Rule Statute

§19.1722 Insurance Code §4201.003 and

Government Code Chapter 2110

9. TEXT.

§19.1722. Utilization Review Advisory Committee.

(a) Purpose and Scope. The purpose of this section is to set out the responsibilities of the Utilization Review Advisory Committee (advisory committee); define its tasks and the manner in which it will report to the commissioner [ department]; specify its membership; and set its duration. The advisory committee is established pursuant to the Insurance Code §4201.003(c)[ , Article 21.58A, §13].

(b) Purpose of the Advisory Committee. The purpose of the advisory committee is to :

(1) advise the commissioner on the development of rules determined by the department as necessary to implement HB 4290, 81st Legislature, Regular Session, effective September 1, 2009, that amends the Insurance Code Chapter 4201[ in developing rules and regulations for utilization review.] ; and

(2) advise the commissioner on other changes and additions to the existing rules regulating utilization review that the department determines are needed to administer the Insurance Code Chapter 4201.

(c) Tasks. The tasks of the advisory committee include those tasks specified in the following paragraphs:

(1) The advisory committee shall review and evaluate proposed changes and additions to the current utilization review rules in this subchapter [ statutes to determine and develop any necessary changes to the current utilization review regulations], and the advisory committee shall make recommendations to the commissioner regarding such proposed changes and additions;

(2) The advisory committee shall advise and consult with the commissioner or the commissioner's representative during its review and evaluation made pursuant to paragraph (1) of this subsection[ of current utilization review statutes]; and

[ (3) The advisory committee may advise the commissioner on the need for subcommittees or workgroups to fulfill its tasks;]

(3)[ (4)] The advisory committee shall perform other tasks related to the development of rules as provided by paragraph (1) of this subsection and as requested by the commissioner pursuant to the Insurance Code Chapter 4201 and the Government Code Chapter 2110[ , Article 21.58A].

(d) Membership. Pursuant to the Insurance Code §4201.003,[ Article 21.58A, §13,] the membership of the advisory committee shall include [ consist of]:

(1) One representative for each of the following: the Office of Public Insurance Counsel, an insurance company, a health maintenance organization, a group hospital service corporation, a workers' compensation insurance carrier, a utilization review agent, a health coverage consumer group, injured employees, an employer, a physician, a dentist, a hospital, a registered nurse, and other health care providers; and

(2) (No change.)

(e) Reporting Requirements. After completion of review and evaluation of proposed changes and additions to the current utilization review rules in this subchapter, or completion of any other tasks in accordance with subsection (c)(3) of this section, the advisory committee shall submit a report of its recommendations to the commissioner.

(f)[ (e)] Duration. The advisory committee shall automatically terminate on December 31, 2010[ 1998], unless, before its termination, the commissioner extends its duration by rule.



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