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Senate State Affairs Committee Questions Kitzman

State senators on Thursday took advantage of a committee hearing on cross-state health coverage to question Insurance Commissioner Eleanor Kitzman on her controversial decision to delay previously-approved consumer protections.

Texas Insurance Commissioner Eleanor Kitzman gives testimony to the Senate Committee on State Affairs on August 30th, 2012

State senators on Thursday took advantage of a committee hearing on cross-state health coverage to question Insurance Commissioner Eleanor Kitzman on her controversial decision to delay previously-approved consumer protections. One lawmaker, state Sen. Wendy Davis, D-Fort Worth, followed up with a letter to Gov. Rick Perry asking for Kitzman's removal. 

Sen. Bob Deuell, R-Greenville and vice chair of the State Affairs Committee, told the Tribune on Tuesday that he and other lawmakers have concerns that Kitzman is “a little too pro-insurance company.” His comments followed a letter he sent to Kitzman expressing his concern over her decision to propose changes to the so-called balance billing rule passed by her predecessor.

The rule was originally intended to protect consumers from out-of-pocket health costs; consumer advocates said Kitzman's revision removed some transparency and reporting requirements that would've helped patients navigate charges from providers outside their health networks.

“I think that certainly consumers should know up front if there is going to be an out-of-network charge,” Kitzman said at the hearing. “But the process that is in place today doesn’t work well for anyone and I know from personal experience it is almost impossible to find out what a procedure is going to cost up front.”

On the same day Deuell sent his letter, Kitzman, who was appointed by Perry in July 2011, sent her own letter to members of the Legislature to fire back against a negative editorial that ran in The Dallas Morning News. In that letter, she said the consumer protection rules were not finalized, and that the editorial failed to mention a mediation process put in place by the Legislature that already protects consumers from excessive balance billing charges. "I believe mediation is much more helpful to consumers than asking them to research and piece together a complex array of data points across websites, provider directories and [health] plan documents necessary to make a truly informed decision," she wrote.

At Thursday's hearing, Sen. Leticia Van de Putte, D-San Antonio, told Kitzman that lawmakers passed legislation directing the Texas Department of Insurance to establish the rules because balance billing was hitting close to home. Some pregnant state employees in Travis County were going to Bexar County to deliver their babies because their home county didn't have any anesthesiologists contracted under the state's health plan — meaning they'd have to pay an additional $1,500 for out-of-network anesthesia. “It became a real problem with our female employees here,” Van de Putte said.

Sen. Robert Duncan, R-Lubbock and the committee chair, asked Kitzman to present lawmakers with a detailed summary of the balance billing rules she has proposed. “Let’s identify exactly what we’re talking about," he said. 

A few hours after the hearing, Davis, who is not on the committee, sent a letter to Perry calling for Kitzman's removal, decrying what she called a "clear pattern of disregard for consumer interests in Texas." 

"It’s unfortunate that Sen. Davis is more interested in grandstanding than working with the commissioner to resolve whatever concerns she may have," said Allison Castle, a spokeswoman for the governor, in an email to the Tribune. "Gov. Perry expects the commissioner to continue working in the best interest of all Texans."

Kitzman originally attended the hearing to testify on the possibility and potential complications of allowing Texas residents to purchase health insurance across state lines.

“It’s not as simple as we start out thinking that it is,” Kitzman said. “It would require undoing or suspending a lot of infrastructure that has been developed over a number of years and probably for very good reason.”

Each state has different regulations for health insurance, and proponents of an interstate market believe allowing consumers to cross state lines to buy coverage would force insurance companies to provide competitive rates. 

The insurance department's preliminary research, presented at Thursday's hearing, indicated that average health insurance premium rates for individual plans range by state from $137 a month to $437 a month. The agency found Texas has lower health insurance premiums that 38 other states, at an average of $267 a month.

Van de Putte said while premium rates are relatively low in Texas, health care costs here are higher than the national average — a sign that "folks are picking up a lot of those out-of-pocket costs,” among other factors. 

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