TITLE 1. ADMINISTRATION

PART 15. TEXAS HEALTH AND HUMAN SERVICES COMMISSION

CHAPTER 370. STATE CHILDREN'S HEALTH INSURANCE PROGRAM

SUBCHAPTER G. STANDARDS FOR CHIP MANAGED CARE

1 TAC §370.602

The Executive Commissioner of the Texas Health and Human Services Commission (HHSC) proposes an amendment to §370.602, concerning Member Complaints and Appeals.

BACKGROUND AND PURPOSE

The proposal is necessary to comply with The Patient Protection and Affordable Care Act of 2010, §2719, as codified in the United States Code, Title 42 §300gg-19(b), which standardizes the external review process of adverse benefit determinations for members of commercial health insurance issuers to meet federal consumer protection standards. The proposed amendment also clarifies the current Children's Health Insurance Program (CHIP) managed care organization (MCO) Member Internal Complaint and Appeal Process.

In accordance with the Code of Federal Regulations, Title 42, §457.1120, HHSC elected to follow the statewide standard review process that Texas commercial health insurance issuers use, instead of a program specific review process. Therefore, §2719 also applies to CHIP MCOs.

The CHIP external review process was administered by Texas Department of Insurance (TDI). As of June 30, 2018, TDI no longer administers the CHIP external review process. All CHIP MCOs follow the federal Health and Human Services-administered external review process described in this rule amendment.

SECTION-BY-SECTION SUMMARY

The proposed amendment to §370.602(a) clarifies that in addition to the Texas Insurance Code and TDI regulations, CHIP member complaints and appeals are subject to federal and state laws, regulations, and rules.

The proposed new language for §370.602(b) provides information on the existing complaint and appeal process, clarifying that a CHIP member may file a complaint or appeal with their MCO through the MCO's internal complaint and appeal system.

The proposed amendment to existing §370.602(b) relabels it to §370.602(c)

and clarifies that a complaint may be submitted to TDI to report an alleged MCO violation, in addition to filing with the MCO.

The proposed new language for §370.602(d) describes the external review process conducted by the independent review organization (IRO). If a member or the representative of a member is dissatisfied with the MCO's resolution of an appeal of an adverse benefit determination, and has exhausted the MCO internal appeal system, the member or the representative of a member may request an external review by the IRO.

FISCAL NOTE

Trey Wood, Chief Financial Officer, has determined that for each year of the first five years that the rule will be in effect, enforcing or administering the rule does not have foreseeable implications relating to costs or revenues of state or local governments.

GOVERNMENT GROWTH IMPACT STATEMENT

HHSC has determined that during the first five years that the rule will be in effect:

(1) the proposed rule will not create or eliminate a government program;

(2) implementation of the proposed rule will not affect the number of HHSC employee positions;

(3) implementation of the proposed rule will result in no assumed change in future legislative appropriations;

(4) the proposed rule will not affect fees paid to HHSC;

(5) the proposed rule will not create a new rule;

(6) the proposed rule will expand an existing rule;

(7) the proposed rule will not change the number of individuals subject to the rule; and

(8) the proposed rule will not affect the state's economy.

SMALL BUSINESS, MICRO-BUSINESS, AND RURAL COMMUNITY IMPACT ANALYSIS

Mr. Wood has also determined that there will be no adverse economic effect on small businesses, micro-businesses, or rural communities.

The proposed rule does not impose any additional costs on small businesses, micro-businesses, or rural communities.

LOCAL EMPLOYMENT IMPACT

The proposed rule will not affect a local economy.

COSTS TO REGULATED PERSONS

Texas Government Code §2001.0045 does not apply to this rule because the rule does not impose a cost on regulated persons and is necessary to receive a source of federal funds or comply with federal law.

PUBLIC BENEFIT AND COSTS

Stephanie Muth, Deputy Executive Commissioner for Medicaid and CHIP Services, has determined that for each year of the first five years the rule is in effect, the public benefit will be improved objectivity in the external review of appeals of adverse benefit determinations.

Mr. Wood has also determined that for the first five years the rule is in effect, there are no anticipated economic costs to persons who are required to comply. The proposed rule codifies existing HHSC practices for CHIP member complaints appeals and is consistent with federal requirements.

TAKINGS IMPACT ASSESSMENT

HHSC has determined that the proposal does not restrict or limit an owner's right to his or her property that would otherwise exist in the absence of government action and, therefore, does not constitute a taking under Texas Government Code §2007.043.

PUBLIC COMMENT

Written comments on the proposal may be submitted to Rules Coordination Office, P.O. Box 13247, Mail Code 4102, Austin, Texas 78711-3247, or street address 4900 North Lamar Boulevard, Austin, Texas 78751; or emailed to HHSRulesCoordinationOffice@hhsc.state.tx.us.

To be considered, comments must be submitted no later than 31 days after the date of this issue of the Texas Register (the comment period). Comments must be: (1) postmarked or shipped before the last day of the comment period; (2) hand-delivered before 5:00 p.m. on the last business day of the comment period; or (3) emailed before midnight on the last day of the comment period. If last day to submit comments falls on a holiday, comments must be postmarked, shipped, or emailed before midnight on the following business day to be accepted. When emailing comments, please indicate "Comments on Proposed Rule 19R057" in the subject line.

STATUTORY AUTHORITY

The amendment is authorized by Texas Government Code §531.0055, which provides that the Executive Commissioner of HHSC shall adopt rules for the operation and provision of services by the health and human services system; Texas Government Code §531.033, which provides the Executive Commissioner of HHSC with broad rulemaking authority; and Texas Health and Safety Code Chapters 62 and 63, which provide HHSC with the authority to administer CHIP in Texas and adopt rules as necessary to implement the chapters.

The amendment affects Texas Government Code §531.0055.

§370.602.Member Complaints and Appeals.

(a) CHIP member complaints and appeals are subject to disposition consistent with applicable federal and state laws, regulations and rules, including the Texas Insurance Code and [any applicable] Texas Department of Insurance (TDI) regulations.

(b) Any member, or a representative acting on behalf of the member, may file a complaint or appeal with their managed care organization (MCO) through the MCO's internal appeal and complaint system.

(c) [(b)] Any person, including those dissatisfied with the MCO's resolution of a member complaint or appeal, may submit a complaint to report an alleged violation to TDI.

(d) Any member or a representative acting on behalf of the member may request an external review of the MCO's adverse benefit determination, to be conducted by an independent review organization, when:

(1) the MCO internal appeal and complaint system regarding the adverse benefit determination has been exhausted; and

(2) the member or representative acting on behalf of the member is dissatisfied with the MCO's resolution of the appeal of an adverse benefit determination.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on July 7, 2020.

TRD-202002777

Karen Ray

Chief Counsel

Texas Health and Human Services Commission

Earliest possible date of adoption: August 23, 2020

For further information, please call: (512) 624-6998