Relating to health benefit plan preauthorization requirements for participating physicians and providers providing certain health care services.
Summary
SB 1380 would limit when health maintenance organizations and insurers may require preauthorization for certain services provided by participating physicians and providers. The bill creates a new subchapter in the Insurance Code that bars preauthorization for emergency care, intervention-necessary care, outpatient mental health and substance use disorder treatment (with limited exceptions for prescription drugs and IV infusions), certain urgent ophthalmologic services, preventive services recommended by the U.S. Preventive Services Task Force, other federally defined preventive services, and services delivered under fully capitated arrangements unless the provider agrees otherwise.
The bill also restricts what insurers and HMOs may do after the fact. For services that are exempt from preauthorization, a plan generally could not deny or reduce payment unless the provider materially misrepresented the service with intent to deceive or failed to substantially perform the service. Retrospective review would be limited to situations where there is reasonable cause to suspect one of those grounds exists, and if a provider unnecessarily submits a preauthorization request for an exempt service, the plan must notify the provider in writing that preauthorization is not required and explain payment requirements. The bill applies to certain HMO plans and PPO/EPO plans, but not to Medicaid or the child health plan programs, and it would apply only to plans delivered, issued, or renewed on or after January 1, 2026.
Impact
If enacted, SB 1380 would amend Chapter 4201 of the Insurance Code by adding new limits on utilization management for specified health care services. It would directly affect HMOs, insurers, and entities that perform preauthorization functions for covered plans, while also changing the practical obligations of participating physicians and providers by removing preauthorization hurdles for the listed categories of care. The bill would not expand provider licensure authority or require payment for services outside a provider’s lawful scope, and it preserves existing law governing retrospective review except as specifically narrowed by the bill.
Sentiment
The available voting history suggests the bill had meaningful support in committee, where it was reported adversely with a favorable committee substitute by an 8-1 vote. That pattern indicates broad agreement on the policy direction, with at least one member opposed. No committee transcript was provided, so the record does not show detailed floor or committee debate, but the substitute and vote count suggest the bill was viewed as a targeted reform to reduce prior authorization barriers rather than a sweeping overhaul.
Contention
The main points of contention are likely the balance between patient access and insurer utilization control, and the extent to which the bill limits preauthorization and retrospective review. Insurers and HMOs may object that the bill reduces their ability to manage costs and review medical necessity, especially for outpatient mental health, substance use disorder treatment, and urgent specialty care. Supporters are likely to emphasize faster access to medically necessary treatment, reduced administrative burden on providers, and fewer delays in care. The narrow 8-1 committee vote suggests the policy was generally acceptable to the committee, but not without at least some concern about restricting plan oversight.
Relating to disclosures of preauthorization requirements and explanations of benefits for medical and health care services and supplies covered by health maintenance organizations and preferred provider benefit plans; imposing administrative penalties.
Relating to funding of excess losses and operating expenses of the Texas Windstorm Insurance Association; authorizing an assessment; authorizing a surcharge.
Relating to compensation and employment condition standards by municipal charter or collective bargaining agreement and to impasse resolution in collective bargaining with certain political subdivisions.