Texas Legislative Update – Senate Bill 490 – Itemized Medical Bills

By: Ryder McCool

Medical debt affects Americans throughout the country. The bills Americans must pay for medical services they receive are often confusing and lacking information that helps the patient understand the charges. Many medical bills list billing codes for treatment and the price charged, but little else that helps a patient identify the specific services provided. Texas Senator Bryan Hughes authored legislation in the most recent Texas legislative session that requires a plain language description of health care services that a patient receives so that the patient can understand the different charges.

The 88^th Texas Legislature passed, and the Governor signed, Senate Bill 490, which specifically mandates:

A health care provider that requests payment from a patient after providing a health care service or related supply to the patient shall submit with the request a written, itemized bill of the alleged cost of each service and supply provided to the patient during the patient’s visit to the provider.  The provider must submit the itemized bill not later than the 30^th day after the provider receives a final payment on the provided service or supply from a third party.

SB 490 further enables a patient to obtain from the health care provider an itemized bill on request at any time after the itemized bill is initially issued. Maintaining patient records and their bills is as important as initially providing the patient with an itemized bill. 

SB 490 defines “health care provider” to include a “facility licensed, certified, or otherwise authorized to provide health care services or supplies in this state in the ordinary course of business, including a hospital, except the term does not include a federally-qualified health center.” The bill further explains that a “health care service” is a “service a health care provider provides to an individual to diagnose, prevent, treat, alleviate, cure, or heal a human health condition, illness, injury, or disease.”

This means that the days of a patient receiving a bill and being confused or unable to identify specific charges listed on the bill should cease to occur when SB 490 goes into effect on September 1, 2023. The itemized bill that patients will be receiving must include:

1. A plain language description of each distinct health care service or supply the health care provider provided to the patient;

2. If the provider sought or is seeking reimbursement from a third party, any billing code submitted to the third party and the amounts billed to and paid by that third party; and

3. The amount the provider alleges is due from the patient for each service and supply provided to the patient.

The plain language description likely needs to be a description of the service that any reader can quickly, completely, and easily understand. If a health care provider abides by the three requirements listed above, they will comply with the statute.

However, if a health care provider fails to abide by the requirements of the statute, “the appropriate licensing authority shall take disciplinary action against the provider for the violation as if the provider violated an applicable licensing law.” Further, the law now requires a health care provider to comply with the requirements of sending itemized bills before they may pursue debt collection against a patient.

Health care providers need to be cognizant of these new requirements. While the new requirements likely will be initially taxing on a health care provider’s billing department, this new process could potentially result in less outstanding medical debt and patients choosing to pay their bills because they can more readily understand the services for which they have been charged.