Senate Bill 1264 is a new Texas law that seeks to eliminate surprise billing or “balance billing,” which occurs when out-of-network health care providers and insurance companies can’t agree on the price of a medical treatment, resulting in hefty surprise medical bills that get sent to the patient. SB 1264 only applies to certain state-regulated health plans.
Texas state Sen. Donna Campbell, an emergency room physician, owns an interest in an emergency room in Kyle, Texas.
Sen. Donna Campbell voted against the first version of SB 1264
Senate Bill 1264 prohibits surprise billing of consumers in situations where the patients have no choice which provider they see or which facility they visit, including medical emergencies, non-network care at in-network hospitals and out-of-network lab and imaging work.
Although a version of SB 1264 eventually passed during the 86th Texas legislative session, Sen. Donna Campbell voted against the first version of the bill introduced in the Senate. She told KVUE news on April 16, 2019:
“Senate Bill 1264 is a step in the wrong direction. This bill moves our state closer to single-payer medicine and further away from doctors and hospitals being able to operate in a free market. The state cannot simply wave a magic wand and
make the real costs of providing health care disappear. These costs have to be made up somewhere, either by reducing access to care or through health insurance companies raising their premiums. Neither is a decent outcome for patients. Surprise medical bills do exist, not because of greedy doctors, but because health insurers who charge thousands of dollars in premiums surprisingly don't pay for health care when families need it. This is the true issue that meaningful health care reform must address. SB 1264 does not, and so I must vote against this bill."
She did not disclose that she is an owner of a Kyle, Texas freestanding emergency room.
Campbell’s personal financial statement (PFS) filed with the Texas Ethics Commission (TEC) that was obtained by Influence Texas via open records request shows she owns an interest in Kyle ER LLC.
Sen. Donna Campbell’s personal financial statement filed with the Texas Ethics Commission shows she owns an interest in Kyle ER LLC, a freestanding emergency room.
Lawmakers are required to disclose their financial interests via personal financial statements. However, the state does not make these filings readily available online. Copies of personal financial statements must be requested from the TEC, which provides the documents in pdf format.
Sen. Charles Schwertner joined Campbell in voting against SB 1264. Schwertner is a physician whose 2018 personal financial statement (covering the 2017 calendar year) shows he was employed by Little River Healthcare System in Rockdale, Texas, a now-bankrupt hospital connected to an apparent lab billing scheme.
Sen. Charles Schwertner’s 2018 personal financial statement filed with the Texas Ethics Commission shows he worked at Little River Heathcare System in Rockdale, Texas.
The SB 1264 Witness List of interested parties who testified during a public hearing on the early version of the bill show that it was largely supported by consumer advocates and insurance companies but opposed by freestanding emergency centers like Campbell’s and certain physician groups, including anesthesiologists. (Much like emergency care, patients don’t get to choose their anesthesiologist, who “always gets the patient.”)
One of the initial groups opposed to SB 1264 was the powerful Texas Medical Association, a group that represents physicians and donated almost $1.5 million to campaigns of various state lawmakers and Gov. Greg Abbott in the most recent election cycle (2017-2018 leading up to the 86th legislative session).
The Texas Medical Association donated almost $1.5 million to Texas state lawmakers and Gov. Greg Abbott during the election cycle leading up to the 86th Legislative session.
Despite Campbell and Schwertner’s opposition, SB 1264 was passed by the Senate and sent to the House, where it was shepherded by Rep. Tom Oliverson, one of four physicians in the 150-member chamber.
Oliverson received campaign donations from the Texas Medical Association and U.S. Anesthesia Partners of Texas. Oliverson’s personal financial statement shows he is a partner in Houston-based U.S. Anesthesia Partners and that is Committee Chairman and PAC board member of the Texas Society of Anesthesiologists, one of the groups that publicly opposed SB 1264 in the Senate.
Rep. Tom Oliverson’s 2018 personal financial statement filed with the Texas Ethics Commission shows he is a partner of U.S. Anesthesia Partners and Committee Chairman and PAC board member of the Texas Society of Anesthesiologists, one of the groups that publicly opposed SB 1264 in the Senate.
The House modified and passed SB 1264 with wide bipartisan support. The same version was passed unanimously in the Senate with Campbell and Schwertner on board.
So—what happened to the bill that made Campbell, Schwertner, and the doctors happy? Will the arbitration process be fair to consumers? Were lawmakers able to represent their constituents fairly when in some cases the consumers’ well-being was in conflict with their own economic interests? Only time will tell how effective the SB 1264 will be in protecting consumers from sticker shock from out-of-network health care.
The arbitration process set up in SB 1264 requires the arbitrator, in determining the reasonable amount for an out-of-network health care or medical service, to factor in—not the average—but the 80th percentile—of the billed charges in the same or similar specialty in the same geographic area.