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In a significant move to improve healthcare access and affordability, (TX HB 711), recently passed by the state legislature, introduces changes that eliminate anti-steering and anti-tiering practices.

Currently, employers in Texas are unable to steer its health plan participants towards certain hospitals and facilities because of anti-steering and anti-tiering laws in place. Notably, the bill eliminates the “all or nothing” clause that requires insurers or group health plans to contract with all providers in a health system if they want to include any providers in the network.

TX HB 711 eliminates these laws the earlier of December 31, 2023 or the effective date of an amendment to a provider network contract that eliminates the anti-steering or anti-tiering provisions.

When will the changes go into effect? Immediately, however, current provisions in contracts can remain in effect until the end of this year. Although, the legislation does allow for an earlier date if an amendment is made to a provider network contract.

What does this mean for employers with group health plan participants in Texas? Starting next year, providers and hospitals will be able to enter into contracts directly with group health plans or insurers which paves the way for narrow networks or direct contracts.

IMA note: While these types of actions will be permissible as described, it’s up to the group health plans to take advantage of the ability to build narrow networks and/or steer patients toward higher quality, lower cost care.

Summary

By eliminating anti-steering and anti-tiering practices, the legislation aims to provide patients with greater freedom to choose their healthcare providers and facilities.

As Texas prepares to implement these changes, it is important for health plans, providers, and consumers to familiarize themselves with the new law and its implications.

IMA will continue to monitor regulator guidance and offer meaningful, practical, timely information. This material should not be considered as a substitute for legal, tax and/or actuarial advice. Contact the appropriate professional counsel for such matters. These materials are not exhaustive and are subject to possible changes in applicable laws, rules, and regulations and their interpretations.