In the most recent legislative session, Texas lawmakers passed three bills addressing surprise medical billing, freestanding emergency room price-gouging, and prescription drug price transparency. The bills are a win in the fight for patient and consumer protection against unforeseen medical billing, an issue that Texas lawmakers have been seeking to put an end to for years.
Perhaps the biggest success of the three is the passing of SB 1264, which prohibits heath care providers from sending surprise bills to patients when the patient had no true choice of providers as when a patient seeks care from an in-network hospital but is treated by an out-of-network provider. This occurrence is not a rarity, as 300 of 407 Texas hospitals have no in-network ER doctors for the three major health care plans, and over 65% of all out-of-network ER doctor claims in Texas are for services taking place in an in-network hospital.
The bill, authored by North Texas State Senator Kelly Hancock, also takes patients out of resolution disputes between healthcare providers and insurers, making consumers solely responsible for applicable co-pays, coinsurance, and deductible amount with no additional charges.
The law has been met with a positive response, according to Texas Association of Health Plans CEO Jamie Dudensing. “Texas is long overdue for a legislative fix to our surprise billing problem, and I’m glad to see the widespread support for Sen. Hancock’s support,” says Dudensing via release.
Additional legislation was passed to protect patients from price-gouging at the hand of freestanding emergency rooms, eliminating such facilities’ ability to use confusing or misleading language, and requiring them to be transparent about their pricing and network status at the time of service, or made available on their website.
The two bills—HB 2014 and HB 1942— authored by Representative Tom Oliverson and Representative Dade Phelan, respectively, work to end confusing language that leads patients to believe the facilities “take” or “accept” insurance even though they’re not actually in network with and allows the Texas Attorney General to take action against FSERs that charge patients more than 200% of the average charges for emergency care in the same area.
In the last nine years, Texas has seen a massive uptick in FSERs, going from around 20 in 2010, to more than 200 in 2019, due in part to passing legislature that allowed the facilities to be licensed emergency rooms. These facilities are often times confused with urgent care centers and charge nearly 20 times what an actual urgent care center or primary care doctor would for treatment of the same ailment. Additionally, FSERs are responsible for nearly $3 billion in unnecessary health care costs in Texas every year.
A third law now requires drug manufacturers, health plans, and pharmacy benefit managers to be transparent about the pricing of prescription drugs.
HB 2536, authored by Rep. Tom Oliverson, requires drug manufacturers to submit a report to the Texas Health and Human Services Commission in the event of a price increase for a specific drug of at least 40% in its wholesale acquisition over the past three years, or at least 15% in the last calendar year. The HHSC is then required to post the reports online.
These reports include the name of the drug, whether it is brand name or generic, the effective date of the change in the wholesale acquisition cost, company-level research and development costs for the most recent year, the name of all the manufacturer’s drugs approved by the FDA in the previous five years, and the name of each of the manufacturer’s drugs that lost patent exclusivity in the past five years.
The bill is yet another step to add transparency amidst rising drug prices in recent years.
“The Legislature’s passage of Dr. Oliverson’s bill shows that Texas is joining the fight against the high cost of prescription drugs, and we look forward to seeing the positive impact drug price transparency makes on Texans’ pocket books,” says Dudensing via release.
