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Q: Mental Health Consumer Rights in the State of Texas ( Answered 5 out of 5 stars,   1 Comment )
Subject: Mental Health Consumer Rights in the State of Texas
Category: Health > Conditions and Diseases
Asked by: mbuchen-ga
List Price: $20.00
Posted: 25 Jul 2003 06:22 PDT
Expires: 24 Aug 2003 06:22 PDT
Question ID: 234947
If a family member is diagnosed with an SMI or serious mental illness
via diagnosis code by a licensed psychologist, I belive that family
member has a right to be reimbursed for up to 60 visits per year
according to law.  I need to find that state statue reference.
Subject: Re: Mental Health Consumer Rights in the State of Texas
Answered By: tehuti-ga on 25 Jul 2003 06:48 PDT
Rated:5 out of 5 stars
Hello mbuchen

The provision you mention comes in Article 3.51-14  of the Texas
Insurance Code:

Art. 3.51-14. Coverage for Certain Serious Mental Illnesses

Section 1 defines “serious mental illness” as those which can be
classified as the following, according to the definitions in the
Diagnostics and Statistical Manual of the American Psychiatric
Association.  These are:
schizophrenia; paranoid and other psychotic disorders; bipolar
disorders (hypomanic, manic, depressive, and mixed); major depressive
disorders (single episode or recurrent); schizo-affective disorders
(bipolar or depressive); pervasive developmental disorders;
obsessive-compulsive disorders; and depression in childhood and

Section. 2. (a) says that the “article applies only to a group health
benefit plan that provides benefits for medical or surgical expenses
incurred as a result of a health condition, accident, or sickness… “ 
and lists the  plans to which the legislation applies.

“Required coverage for serious mental illnesses
Sec. 3. (a) defines the coverage that is required:
A group health benefit plan:
“(1) must provide coverage, based on medical necessity, for the
following treatment of serious mental illness in each calendar year:
(A) 45 days of inpatient treatment; and
(B) 60 visits for outpatient treatment, including group and individual
outpatient treatment;
(2) may not include a lifetime limit on the number of days of
inpatient treatment or the number of outpatient visits covered under
the plan; and
(3) must include the same amount limits, deductibles, copayments, and
coinsurance factors for serious mental illness as for physical
(b) An issuer of a group health benefit plan may not count toward the
number of outpatient visits required to be covered under Subsection
(a)(1) of this section an outpatient visit for the purpose of
medication management and must cover that outpatient visit under the
same terms and conditions as it covers outpatient visits for treatment
of physical illness.
(c) An issuer of a group health benefit plan may provide or offer
coverage required under this section through a managed care plan.”

Exceptions to the requirement are covered in Section  4:
“An issuer of a group health benefit plan to a small employer must
offer the coverage described in Section 3 of this article but is not
required to provide the coverage if the small employer rejects the

The legislation does not apply to illness arising from the illegal use
of controlled substances nor to the treatment of addiction to such

You can read the whole of Chapter 3 at:
The table of contents to the complete Code is at:

Search strategy: 1. texas "mental illness" visits reimbursement   This
identified the source of the legislation, and resulted in search 2:
"Texas Insurance Code"

Request for Answer Clarification by mbuchen-ga on 28 Jul 2003 15:59 PDT
I am hopeful you will discover some information on "medical
It seems that medical necessity is more than a diagnosis having been
determined by a licensed professional. We are being hammered for not
proving medical necessity.  How do you prove that beyond the diagnosis
provided by a medical professional?

Clarification of Answer by tehuti-ga on 28 Jul 2003 17:09 PDT
Hello Mike,

I wonder if this will be useful to you.  

State-by-State Compendium of Medical Necessity Regulation
Survey of State Managed Care Regulators
Center for Health Policy, Stanford University
November, 2001 

It includes a number of tables which summarize the practice in
individual States, and I also noticed the following statement:

"Regulators from the Texas Department of Insurance indicated that they
do not require plans to include any specific clinical evidence
criterion in their standards contracts. However, its utilization
review law states that decisions must be made “in accordance with
currently accepted medical or health care practices, taking into
account special circumstances of each one that may require deviations
from the norms stated in the screening criteria.”

I'm in the GMT zone and it's getting very late here. I'll check this
question again in the morning.

Best wishes

Request for Answer Clarification by mbuchen-ga on 28 Jul 2003 18:40 PDT
Thanks for your help.
I can't imagine that Humana is outside the boundaries of the law, but
if sure seems like it.

Clarification of Answer by tehuti-ga on 29 Jul 2003 01:38 PDT
Are you aware that a class action lawsuit was filed against Humana
Inc. in October 1999:
".... Lawyers, speaking at a news conference at the Washington-based
law firm of Cohen, Milstein, Hausfeld & Toll, said the lawsuit was the
first of its kind against a health maintenance organization and would
seek "a substantial amount" of compensation.
.... Humana, covered up from its subscribers the true way it decided
whether to approve treatment and whether to pay claims of its
subscribers," said Stephen Neuwirth of Boies & Schiller, which is
representing some of the plaintiffs"
... Humana provides direct financial incentives to treating physicians
... to deny coverage to individuals ... even where the proposed
treatment satisfies the Humana medical necessity definition
... The suit also alleged that claim reviewers often had no medical
"Humana thus failed to inform (subscribers) that decisions respecting
medical necessity would be made by persons without the appropriate
medical experience or training to recognize medical necessity," " 

A longer analysis of the topic:

And more about the whole issue of medical necessity and denial of
treatment, with a focus on individual cases, mainly involving Humana. 
Some people have managed to get redress:
"Given these profit-driven practices of sacrificing human health on
the altar of corporate greed, it is little wonder that juries are
reacting with outrage and awarding mega-verdicts to managed care’s
In January 1999, a California jury awarded $120.5 million to the widow
of a man who died of stomach cancer after Aetna U.S. Healthcare denied
treatment his doctor had requested.
A year later, in the Caitlyn Chipps case, a Florida jury awarded the
family $79.6 million.  “It's not about just one family,” one juror
remarked afterward.  “It's a case about Humana's conduct toward many
people they insure.  We wanted to send a message.” " 

And something closer to home geographically:
AMA, TMA criticize Texas' legal settlement with Aetna 
The agreement has weak medical necessity provisions and could strip
patient appeal rights, the groups say.
By Sarah A. Klein, AMNews staff. June 19, 2000. (American
Medical Association web site)

Three state medical societies join HMO racketeering lawsuit
Texas, California and Georgia medical associations band together
against managed care. Court, they say, is their last resort to solve
prompt-payment and medical necessity concerns.
By Tanya Albert, AMNews staff. April 16, 2001. 
"The Texas Legislature passed some of the strongest patient protection
laws in the nation, but insurance companies point to the federal
Employee Retirement Income Security Act of 1974 to protect them from
state laws, said TMA President Jim Rohack, MD.
... Among claims the medical associations make in the lawsuit are that
Do not use "medical necessity" criteria to make coverage and treatment
decisions or in reimbursing physicians. Instead, they say, HMOs use
cost-based criteria to approve or deny claims. "These undisclosed
cost-based criteria include defendants' own guidelines and criteria,
as well as guidelines developed in concert with third parties,
including but not limited to Milliman & Robertson and InterQual,"
... Aetna Inc. and its Prudential unit, Cigna Corp., United Health
Group, Humana Inc., Foundation Health Systems, PacifiCare Health
Systems, Coventry Health Care Inc. and WellPoint Health Networks are
named in the lawsuit." 

Perhaps it might be worth contacting these people:
"The Bazelon Center for Mental Health Law is the leading national
legal advocate for people with mental illnesses or mental retardation.
Through precedent-setting litigation and in the public policy arena,
the Bazelon Center works to advance and preserve the rights of people
with mental illnesses and developmental disabilities."

Request for Answer Clarification by mbuchen-ga on 31 Jul 2003 05:26 PDT
Dear Tehuti
I am done with this topic.
I have used the references you have sent
Stand down for now but I may be back soon.
If I post another question I will direct it to 'tehuti' or another name.
mbuchen-ga rated this answer:5 out of 5 stars and gave an additional tip of: $5.00
Well done and fast!

Subject: Re: Mental Health Consumer Rights in the State of Texas
From: tehuti-ga on 28 Jul 2003 04:13 PDT
Glad to be of assistance, Mike, and thank you very much for the tip.

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