H.B. No. 2254 amends the Texas Insurance Code by adding Section 1301.0065, which clarifies the legality of value-based and capitated payment arrangements between insurers and primary care physicians or physician groups. The bill defines "primary care physician" and "primary care physician group," allowing insurers to contract with these entities for primary health care services through various payment arrangements, including fee-for-service, risk-sharing, and capitation. Importantly, it stipulates that entering into such contracts does not classify the primary care physician or group as engaging in the business of insurance.

The bill also includes provisions to protect primary care physicians and groups from discrimination by insurers based on their participation in these payment arrangements. Insurers are prohibited from reducing fees or requiring participation in value-based or capitated arrangements as a condition for inclusion in their provider networks. Additionally, the bill mandates that contracts must not create disincentives for providing necessary health care services and must include specific terms regarding performance measures, patient attribution, and renegotiation opportunities. The act will take effect immediately upon receiving a two-thirds vote from both houses or on September 1, 2025, if that threshold is not met.

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