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No fiscal implication to the State is anticipated.
HB 1445 would amend tax code to clarify that "Insurance Service" does not include a medical or dental billing service performed prior to a health or dental insurance coverage claim is submitted. It also provides a definition of medical or dental billing service to mean, "assigning codes for the preparation of medical or dental claims, verifying medical or dental insurance eligibility, preparing medical or dental claim forms for filing, and filing a medical or dental claim."
By designating "medical or dental billing services" as not being an insurance service, it would fall outside the scope of taxable services under the current tax code. Currently, medical billing services are not being taxed based on a determination in 2002 by the Comptroller's office, however, in 2019 they reversed this decision stating that beginning in 2021 these services would be subject to the state's sales and use tax (STAR: State Automated Tax Research for the State of Texas).
Ultimately, it is preferable to have the legislature rather than a state agency decide whether (or at what point in the process) medical billing services are considered taxable. For this reason, Texas Action supports HB 1445.
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