Texas Law Expanding Mediation for Certain Surprise Medical Bills Takes Effect on September 1st

On September 1st, a new law aimed at expanding a patient’s ability to mediate surprise health insurance bills will go into effect across Texas.  Senate Bill 507, titled “Relating to mediation of the settlement of certain out-of-network health benefit claims involving balance billing,” allows patients to mediate balance bills in excess of $500 for emergency medical services that are considered out-of-network or are otherwise not paid for by insurance. The measure was sponsored by Senator Kelly Hancock of North Richland Hills and backed by the Texas Medical Association.

According to the Bill Sponsor’s Statement of Intent:

Balance billing is the practice of physicians billing a patient for the portion of medical expenses not covered by the patient’s insurance. This most commonly occurs when a facility-based physician does not have a contract with the same health benefit plans that have contracted with the facility in which they practice. An enrollee who is admitted into one of these facilities becomes ultimately responsible for an unexpected bill.

Prior to the passage of H.B. 2256, 81st Legislature, Regular Session, 2009, there was no remedy for this unexpected bill other than the patient attempting to set up a payment plan with the facility-based physician. H.B. 2256 established a new mediation process for patients who are balance billed if the bill is more than $1,000. Despite the success of mediation, balance billing continues to be common practice, including in emergency care situations.

S.B. 481 by Senator Hancock, 84th Legislature, Regular Session, 2015, expanded options for mediation by reducing the claim threshold from $1,000 to $500. The legislation added assistant surgeons to the list of providers subject to mediation and requires patients to be notified about the option of mediation. Current law now includes facility-based radiologists, anesthesiologists, pathologists, ER physicians, neonatologists, and assistant surgeons as providers subject to mediation. (Original Author’s / Sponsor’s Statement of Intent)

S.B. 507 amends current law relating to mediation of the settlement of certain out-of-network health benefit claims involving balance billing.

The full text of the new law is available online.

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