Relating to certain health care services contract arrangements entered into by insurers and health care providers.

Doctors gain payment options with new limits

Texas preferred and exclusive provider health plans can use several payment methods with primary care doctors and qualifying groups. Options include payment per service, shared financial risk, fixed payments called capitation, or a mix. Capitation pays a set amount for defined covered services over a set period, regardless of how many services patients receive. The law does not authorize global capitation for all care, and contracting parties cannot subcontract their duties. Eligible doctors practice family medicine, general internal medicine, or general pediatrics and provide first-contact and ongoing comprehensive care. Groups must include at least two primary care doctors and meet physician-ownership or certified nonprofit-clinic rules. Contracts must follow Texas rules governing these physician groups. Doctors entering these contracts are not treated as insurers. Insurers cannot punish doctors who decline, including through lower fees or exclusion from their networks. Doctors and groups can report discrimination to the Texas Department of Insurance. Contracts cannot discourage medically necessary care or interfere with doctors’ independent medical judgment. Written performance-based contracts must identify measures, their sources, calculation methods and periods, access to supporting information, and reconsideration procedures. Patients are assigned first to an established doctor, based on prior annual exams or office visits. Without an established doctor, assignment follows the patient’s choice. Capitation contracts must state whether transition payments apply and how long they last. They must address loss limits, guaranteed minimum monthly payments, stop-loss insurance, and payment adjustments when patients enter or leave. A material increase in covered services or change in plan benefits triggers a contractual right to renegotiate in good faith or return to payment per service. Contracts must state whether catastrophic events are excluded from final cost comparisons. They must also explain whether shared savings include all savings after a minimum threshold or only savings above it. The law sets no direct change to patient premiums or out-of-pocket costs. Its effective-date rule provides immediate effect with a two-thirds vote of all elected members in each chamber; otherwise, September 1, 2025.