H.B. No. 4012, introduced by Paul, seeks to strengthen the enforcement of health care and insurance fraud laws in Texas by establishing new civil penalties and enabling private individuals to take legal action against violators. The bill amends the Government Code and Insurance Code to empower the office of inspector general to collaborate with the Texas Department of Insurance for fraud detection and prevention. It introduces a new section that allows individuals to initiate civil actions for specific fraud-related offenses, detailing liabilities and penalties, including monetary fines based on the severity of the offense and its impact on vulnerable populations. Additionally, the bill creates a fraud prevention partnership among stakeholders, such as Medicaid managed care organizations and health benefit plan issuers, to collectively combat health care fraud.

The bill also amends the Penal Code to define offenses related to health benefit plans, making it a crime to knowingly make false statements or misrepresentations to obtain unauthorized benefits. It categorizes penalties based on the monetary value of the fraud, ranging from Class C misdemeanors for amounts under $100 to first-degree felonies for amounts exceeding $300,000. Furthermore, it modifies the Code of Criminal Procedure to allow evidence of total pecuniary loss to be introduced during the punishment phase of trials for these offenses. The changes will take effect on September 1, 2025, and aim to streamline legal processes while protecting the rights of individuals involved in fraud-related actions.

Statutes affected:
Introduced: Insurance Code 701.102 (Insurance Code 701)