On May 23, 2017, Texas Governor Greg Abbott signed Senate Bill (SB) 507, expanding the current law dealing with “balance billing.”

Balance billing occurs when an insured patient receives care from a physician, hospital or other healthcare provider, who is not part of a patient’s health plan provider network. The out-of-network provider then bills the patient directly for the portion of medical expenses not covered by insurance, typically at a much higher rate.

In 2009, Texas passed legislation establishing a Texas Department of Insurance (TDI) mediation system aimed at resolving balance billing issues. The 2009 legislation made mediation available to patients who were balanced billed by six types of facility-based providers: radiologists, anesthesiologists, pathologists, ER physicians, neonatologists and assistant surgeons. Effective September 1, 2017, SB 507 expands access to balance billing mediation eligibility to all types of out-of-network providers treating patients at in-network hospitals and other facilities, including freestanding ERs. SB 507 also allows mediation for emergent care balance bills over $500 at any healthcare facility, whether in or out of network. The legislation will cover Texans with PPO plans receiving care from an out-of-network provider at an in-network facility. It will also cover the Teachers Retirement System, in addition to the Employee Retirement System covered by the original legislation.

SB 507 also expands disclosure requirements on network status by health plans, facilities, and other healthcare providers. These new requirements include, among other things, that a bill sent to a patient contain an explanation of the mediation process, and a statement that is substantially similar to the following:

“You may be able to reduce some of your out-of-pocket costs for an out-of-network medical or health care claim that is eligible for mediation by contacting the Texas Department of Insurance at (website) and (phone number, including requiring that the following statement be added to balance bills.”

Providers should become familiar with the new balance billing requirements to determine how they will impact current billing practices. A full copy of SB 507 is available at Texas Legislature Online.