SB 632 – What it Means to Texas Optometrists

1. The law only applies to non-covered services and products. Covered services and products remain unaffected.

2. The law defines what a covered service or product is to distinguish them from non-covered services and products. A covered service or product either has a direct reimbursement available from the managed care plan, or a reimbursement amount that is subject to a plan limitation such as a deductible, copay or cost share amount. If a service or product has no reimbursement available, it is a non-covered service or product, and theprovisions of SB 632 apply.

3. Examples of non-covered services and products that will be subject to the new law are:
• “discount only” examinations
• discounts on contact lens services when a patient chooses to receive glasses
• benefits in an “either-or” benefit
• scenario
• discounts on diagnostic tests that are not covered
• discounts on additional frames and lenses beyond what is covered
• discounts on special lens options and treatments that are not covered
• discounts on contact lens materials that are not covered
• any other non-covered service or product provided by an optometrist

4. It is important to remember that the law does not prohibit optometrists from giving discounts on non-covered services as they see fit for their businesses. It simply prohibits the managed care plan from contractually dictating any certain discount or capped fee.

5. The law applies to “managed care plans” which are defined in Texas Insurance Code as plans offered by any type of health insurer or health maintenance organization. This definition includes both medical plan companies and vision plan companies.

6. The law goes into effect on September 1, 2013. The law only applies to contracts with optometrists that are signed on or after January 1, 2014. This means that if you have a current contract with a medical plan or vision plan, this law does not change the terms of that contract you have agreed to and signed. You will still have to follow the terms outlined in that contract, even if it requires discounts on non-covered services and products. When your contract with a plan is up for renewal, the new law will begin to apply. Most contracts are typically up for renewal every three years, but check your contract to know when it ends or when it is set to automatically renew.

7. What’s the bottom line? For any non-covered services and product,
the managed care plan can’t contractually require the optometrist to limit their fee nor require any certain discount.

8. What does this mean for optometrists and why is this good? This new law allows small business optometrists to
be in control of their professional fees for services and products the insurance company chooses not to cover
for their beneficiaries. For non-covered services and products, you can set your prices and give discounts to your patients based on what you decide and based on your local market conditions.

9. This bill will also give optometrists more clarity when evaluating managed care contracts to accept in their practices. The decision to accept a particular managed care plan will be made easier by only having to analyze the reimbursements for covered services.

The TOA recommends careful review and consideration of any provider contracts presented to you. Please contact Bj Avery at bj@txeyedoctors.com if you have questions regarding this update.
This information was originally published by TOA on July 9, 2013.

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