The fully-worked state-law layer for Texas patients. The LLM uses this when the patient's state is Texas. Tennessee equivalent at laws_state_tn.md; Georgia at laws_state_ga.md. All citations verified against public sources as of 2026-05-18. Re-verify annually.
Three things make Texas's patient-side leverage unusually strong:
- The Unfair Methods of Competition and Unfair or Deceptive Acts Act has a private right of action (Tex. Ins. Code Chapter 541, Subchapter D). Unlike Tennessee and Georgia where unfair-claims-practice statutes are regulator-only, in Texas the policyholder may sue directly for actual damages, attorney's fees, and up to treble damages for knowing violations. This is the headline Texas advantage.
- Two-tier hospital itemization duty. Older Tex. Health & Safety Code § 311.002 (request-driven, 30 business days) plus SB 490 (2023), codified at Tex. Health & Safety Code Chapter 185, which makes itemization a prerequisite to debt collection for HHSC-licensed facilities. A hospital that has not delivered a compliant itemized bill cannot lawfully collect, period.
- Texas Prompt Payment of Claims Act (Tex. Ins. Code Chapter 542, Subchapter B) is a strict-liability statute. One day late triggers an 18% per annum penalty plus attorney's fees, with no bad-faith showing required.
Ground-ambulance protection (SB 2476, extended by SB 916) is a fourth advantage but with state-regulated-plan and sunset caveats noted below.
- Statute: Tex. Health & Safety Code § 311.002
- Source: texas.public.law/statutes/tex._health_and_safety_code_section_311.002; chapter at statutes.capitol.texas.gov/Docs/HS/htm/HS.311.htm
- What it requires:
- On request, the hospital must provide an itemized statement of billed services not later than 30 business days after discharge (or after the request is received post-discharge).
- The statement must be "printed in a conspicuous manner" and list service dates, claim-submission status, and a billing-questions phone number.
- Before discharge, the hospital must inform the patient of the availability of the statement.
- Patients may request the statement within one year of discharge. Third-party payors may also request within one year of receiving the claim; the hospital has 30 days to respond.
- First two copies are free; subsequent copies may carry a reasonable copy fee.
- Enforcement: Department of State Health Services may assess administrative penalties or suspend a hospital's license (subsection (g)).
- Scope: Hospitals, chemical-dependency facilities, and mental-health facilities. Excludes hospitals operated by the federal government.
- No express private right of action for an itemization-only violation under § 311.002 itself, but a non-compliant hospital is exposed under DTPA (Tex. Bus. & Com. Code § 17.46) and the SB 490 collection bar below.
- Statute: Tex. Health & Safety Code Chapter 185 (Health Care Billing), added by SB 490, effective September 1, 2023
- Sources: capitol.texas.gov/tlodocs/88R/billtext/html/SB00490F.htm; plain-English summary at forvismazars.us/forsights/2023/07/texas-medical-billing-transparency-law-takes-effect-sept-1
- What it requires:
- When requesting payment from a patient, an HHSC-licensed facility (hospitals, ambulatory surgical centers, freestanding ERs, etc.) must provide an itemized bill including (i) a plain-language description of each service or supply, (ii) any billing code submitted to a third-party payor and the amount the payor paid, and (iii) the amount alleged due from the patient for each line item.
- Bill must be sent no later than 30 days after the provider receives final payment from any third-party payor.
- Critical enforcement teeth: "A health care provider that violates this chapter may not pursue debt collection against the patient until the provider complies." This is the strongest piece of leverage in the Texas pack: non-compliance is a complete defense to collection.
- Disciplinary action: licensing authority "shall take disciplinary action" for violations.
- Scope: Facilities licensed by HHSC. Individual physician practices are not directly covered by Chapter 185 but remain subject to § 311.002 if hospital-based and to DTPA more generally.
- Statute: Tex. Health & Safety Code § 311.0025
- Source: texas.public.law/statutes/tex._health_and_safety_code_section_311.0025
- What it prohibits: A hospital, treatment facility, mental-health facility, or healthcare professional may not submit a bill for a treatment it knows was not provided, or was improper, unreasonable, or medically/clinically unnecessary.
- Enforcement: Licensing-agency audit of billings and patient records on complaint; disciplinary action up to license revocation; "in addition to" other civil/administrative/criminal penalties.
- Caveat: No private right of action under § 311.0025 itself. Cite this when filing a complaint with the Texas Medical Board / HHSC for billing for services not rendered, and as evidentiary basis for a DTPA or Chapter 541 claim. The "unknowing and isolated billing errors" carve-out shields honest mistakes.
- Statute: Tex. Ins. Code Chapter 541; listed unfair settlement practices at § 541.060; private right of action at § 541.151; damages at § 541.152; 60-day pre-suit notice at § 541.154
- Sources: statutes.capitol.texas.gov/Docs/IN/htm/IN.541.htm; law.justia.com/codes/texas/insurance-code/title-5/subtitle-c/chapter-541/subchapter-d; § 541.060 at codes.findlaw.com/tx/insurance-code/ins-sect-541-060
- Substance of § 541.060: Prohibits misrepresenting a material fact or policy provision; failing in good faith to effectuate a prompt, fair, and equitable settlement when liability has become reasonably clear; failing to provide a reasonable explanation of the basis for denial; failing to affirm or deny coverage within a reasonable time; refusing to pay without conducting a reasonable investigation. (Tracks NAIC model.)
- Private right of action (§ 541.151): YES, Texas is one of the states where Chapter 541 gives the insured a direct cause of action. This is the single most important Texas-specific difference from Tennessee and Georgia. Tennessee's § 56-8-105 and Georgia's § 33-6-30 et seq. are regulator-only; Texas is not.
- Damages (§ 541.152):
- Actual damages.
- Reasonable and necessary attorney's fees and court costs.
- Up to three times actual damages ("treble") if the trier of fact finds the violation was committed knowingly.
- Court-equitable relief as deemed proper.
- Procedural requirement (§ 541.154): Send a written notice not later than the 61st day before suit is filed (the "60-day notice letter"), identifying (i) the specific complaint, (ii) actual damages and expenses, and (iii) reasonable attorney's fees already incurred. Failure to send notice does not bar the action but gives the defendant grounds to abate the case until 60 days after notice is received.
- ERISA preemption: Chapter 541 is preempted as applied to self-funded ERISA employer plans. For ERISA self-funded plans, the federal remedy is 29 U.S.C. § 1132(a)(1)(B) plus possible § 1132(g) attorney's fees, no state treble. Chapter 541 remains in play for fully-insured plans, individual/marketplace plans, ERS, TRS, and Medicaid managed-care plans regulated by Texas.
- Practical use: Cite § 541.060(a)(2)(A) (failure to settle in good faith when liability reasonably clear) and § 541.060(a)(7) (refusal to pay without reasonable investigation) in any Texas insurer dispute letter. The 60-day notice letter is itself a powerful settlement lever, most insurers prefer to pay the underlying claim than face treble exposure.
- Statute: Tex. Ins. Code Chapter 542, Subchapter B; key liability provision at § 542.060
- Source: statutes.capitol.texas.gov/Docs/IN/pdf/IN.542.pdf; § 542.060 at law.justia.com/codes/texas/insurance-code/title-5/subtitle-c/chapter-542/subchapter-b/section-542-060
- Substance: Insurers must acknowledge receipt of a claim within statutory deadlines, begin investigation, and accept or reject within strict timeframes. If the insurer fails to pay within the statutory window after receiving all items reasonably requested, the insurer is liable to the policyholder or claim beneficiary for, in addition to the claim amount:
- Interest at 18% per annum on the unpaid claim, as damages, accruing from the date payment was required.
- Reasonable and necessary attorney's fees.
- Strict-liability statute: policyholder does NOT need to prove bad faith or malice. Even one day late triggers the penalty. Calculation: (Claim × 0.18) ÷ 365 × Days Late.
- Scope: Applies broadly to insurance contracts subject to the Texas Insurance Code, including health, accident-and-sickness, and property/casualty. Preempted by ERISA for self-funded employer plans.
- Statutes: Tex. Ins. Code Chapter 1301, Subchapter C (Preferred Provider Benefit Plans / PPOs) and Chapter 843 (HMOs)
- Source: statutes.capitol.texas.gov/docs/in/pdf/in.1301.pdf; TDI FAQ at tdi.texas.gov/hprovider/ppsb418faq.html
- Substance: For "clean claims" from contracted in-network providers, the payor must pay within 30 days (electronic claims) or 45 days (paper claims) of receipt. Late payment triggers penalties of 50%-100% of the contract discount, capped at $100,000-$200,000.
- Caveat: Chapter 1301/843 prompt-pay is provider-vs-payor remedy; the patient is not directly entitled to the penalty. Cite Chapter 1301 in dispute letters where a provider is balance-billing the patient because the insurer paid late, this often shifts the dispute back to the insurer where it belongs.
Texas bad-faith law splits along third-party vs first-party lines.
- Authority: G.A. Stowers Furniture Co. v. American Indemnity Co., 15 S.W.2d 544 (Tex. Comm'n App. 1929)
- Substance: When a third-party claimant makes a settlement demand within policy limits that a reasonably prudent insurer would accept, the insurer's failure to accept exposes it to liability for the full excess judgment, even above policy limits.
- Applicability to medical billing: Stowers is primarily a liability-insurance doctrine (auto, homeowners). Rarely the primary citation in a hospital-bill dispute. Mention only when the underlying dispute arises from a personal-injury case where a liability insurer is involved.
- Statutory route: Tex. Ins. Code Chapter 541 (treble damages, attorney's fees, see above) + Chapter 542 (18% prompt-pay penalty, see above). These are the workhorse first-party bad-faith claims.
- Common-law duty: Texas recognizes a common-law duty of good faith and fair dealing between insurer and insured for first-party claims (Arnold v. National County Mutual Fire Ins. Co., 725 S.W.2d 165 (Tex. 1987)). Breach exposes the insurer to extra-contractual damages including mental anguish and (in extreme cases) punitives.
- DTPA tie-in (§ 541.151(2)): A Chapter 541 violation is also actionable under the Texas Deceptive Trade Practices-Consumer Protection Act, Tex. Bus. & Com. Code § 17.50, which carries its own treble-damages provision.
- ERISA caveat: All three routes (Chapter 541, Chapter 542, common-law duty) are preempted for self-funded ERISA plans. Use only for fully-insured, individual/marketplace, ERS, TRS, or Medicaid managed-care plans.
- Statute: Tex. Ins. Code Chapter 1467 (Out-of-Network Claim Dispute Resolution), enacted by SB 1264 (86th Leg., 2019), effective January 1, 2020
- Sources: statutes.capitol.texas.gov/Docs/IN/htm/IN.1467.htm; TDI consumer portal at tdi.texas.gov/medical-billing/index.html; Texas Medical Association overview at texmed.org/WorkArea/DownloadAsset.aspx?id=52219
- Balance billing for emergency services from an out-of-network (OON) provider or facility for an insured in a state-regulated plan.
- Balance billing by an OON provider for non-emergency services rendered at an in-network facility (anesthesia, radiology, pathology, lab, assistant surgeon, etc.).
- Balance billing by OON labs/diagnostic-imaging providers when the in-network provider ordered the service.
- Patient cost-sharing is capped at the in-network amount and counts toward the in-network deductible and out-of-pocket maximum.
- Mediation for billing disputes between out-of-network facilities and health plans.
- Arbitration for billing disputes between out-of-network non-facility providers and health plans.
- The patient is not a party to either proceeding; the rate dispute is resolved between insurer and provider.
- The federal NSA and Texas SB 1264 layer; the federal Act is a floor, not a ceiling. Where the Texas law gives broader protection, it applies to state-regulated plans; where the federal NSA gives broader protection, it applies to all plans including ERISA self-funded.
- Texas predates federal NSA by two years and provided the template for parts of the federal scheme.
- Texas IDR remains the dispute vehicle for state-regulated plans; federal IDR applies to ERISA self-funded.
- Scope: state-regulated health plans, ERS, TRS. ERISA self-funded plans may opt in to Texas IDR (HB 1592, 2021) but most do not.
- Excludes air ambulance (federal NSA covers air ambulance), workers' compensation, Medicare, and Medicaid.
- The protection applies to the plan, not the provider, a Texas resident with an out-of-state ERISA plan is covered by federal NSA only.
- Statute: Tex. Ins. Code Chapter 1271 and related (added by SB 2476, 88th Leg., 2023; extended and modified by SB 916, 89th Leg., 2025)
- Sources: tahp.org/new-texas-law-bans-surprise-ambulance-bills; capitol.texas.gov/tlodocs/89R/analysis/html/SB00916F.htm; txemsa.com/the-texas-legislature-extends-the-landmark-ems-law-to-protect-texas-patients
- SB 2476 effective January 1, 2024: banned balance billing for ground ambulance and EMS in state-regulated plans.
- SB 916 effective September 1, 2025: extended the sunset date to September 1, 2027, expanded coverage language to apply "regardless of whether an emergency medical services provider is directly operated by a governmental entity," gave DSHS enforcement authority, and capped rate-of-increase to the Medicare Ambulance Inflation Factor or 10% (whichever is lower).
- Insured patient pays only the in-network cost-share for a covered ground-ambulance trip.
- Insurer pays the provider based on a locally-set rate (where a county/municipality has set one) or, where no local rate exists, the lesser of 325% of the Medicare rate or the full billed charge.
- Patient is held harmless from any rate dispute.
- State-regulated plans only: the law reaches plans regulated by TDI, plus ERS and TRS. Approximately one-third of insured Texans. Self-funded ERISA plans are not covered unless they opt in.
- Sunset: September 1, 2027, re-verify status before relying on this citation in late-2027 / 2028 dispute letters. The federal NSA still excludes ground ambulance (the federal advisory committee published recommendations in 2024 but Congress has not legislated).
- Air ambulance is covered by federal NSA, not by Texas state law.
- Online complaint portal: tdi.texas.gov/consumer/get-help-with-an-insurance-complaint.html (form at tdi.texas.gov/consumer/complfrm.html)
- Help line: 1-800-252-3439 (Mon-Fri, 8 a.m.-5 p.m. Central)
- Email: ConsumerProtection@tdi.texas.gov
- Mail:
Consumer Protection Texas Department of Insurance PO Box 149091 Austin, TX 78714-9091
- Fax: 512-490-1007
- Authority: all insurance companies licensed in Texas including fully-insured health insurers, HMOs, PPOs, Medicare supplement, ERS, TRS. Administers Chapter 541, Chapter 542, Chapter 1467 (SB 1264 balance billing), and SB 2476/SB 916 (ground ambulance). Operates the Texas IDR portal for state-regulated balance-billing disputes. No authority over self-funded ERISA plans (route to DOL EBSA at 1-866-444-3272) and does not regulate providers, hospitals, or debt collectors directly (route to AG and HHSC).
- Online complaint portal: consumerprotection.texasattorneygeneral.gov/consumercomplaintportal
- Phone: Consumer Protection Hotline 1-800-621-0508 (Mon-Fri, 8 a.m.-5 p.m. Central)
- Mail:
Office of the Attorney General Consumer Protection Division P.O. Box 12548 Austin, TX 78711-2548
- Physical address: 300 W. 15th Street, Austin, TX 78701
- Authority: enforces the Texas Deceptive Trade Practices Act (DTPA, Tex. Bus. & Com. Code § 17.41 et seq.) and the Texas Debt Collection Act (Tex. Fin. Code Chapter 392). Reach over providers, hospitals, third-party debt collectors, and original creditors, the gap not covered by TDI. Useful when the dispute is with the hospital's in-house billing department or a collection agency.
- Phone: Hospital complaints 1-888-973-0022; consumer rights line 1-800-458-9858
- Authority: facility-licensure complaints against hospitals, ambulatory surgical centers, freestanding ERs (including SB 490 / Chapter 185 itemized-billing violations). Route hospital-facility-level complaints here, not to TDI.
- Online complaint: tmb.state.tx.us/page/file-a-complaint
- Authority: complaints against individual physicians for billing for services not rendered or fraudulent billing under § 311.0025.
- Court name: Justice Court (Justice of the Peace court; one per county, multiple precincts per county)
- Jurisdictional limit: $20,000, exclusive of statutory interest and court costs but including attorney's fees if any, set by Tex. Gov't Code § 27.031 (limit raised from $10,000 effective Sept. 1, 2020)
- Source: texaslawhelp.org/article/how-to-sue-in-justice-court-small-claims-court; FAQ at sll.texas.gov/faqs/small-claims-maximum
- Filing fees: typically $54-$100 initial filing including service on one defendant; varies by county/precinct. Add roughly $30-$80 for service by certified mail or constable. Fee waivers available for low-income filers via Statement of Inability to Afford Payment of Court Costs.
- Attorney rules: permitted, not required. Justice Courts are designed for pro se litigants, simplified pleadings under Texas Rules of Civil Procedure Part V (Rules 500-510), limited formal discovery, relaxed evidence rules. Corporations and LLCs may appear through a non-attorney employee.
- Appeals: decisions appealable de novo to County Court (Constitutional or County Court at Law) within 21 days under TRCP Rule 506.
The combination of a $20,000 limit (much higher than many states' small-claims caps) and pro-se-friendly procedure makes Justice Court a strong forum for medical-bill disputes. Most hospital bills resolve within this limit.
- Breach of contract (written): 4 years from breach, Tex. Civ. Prac. & Rem. Code § 16.004(a)(3)
- Breach of contract (oral): 4 years from breach, Tex. Civ. Prac. & Rem. Code § 16.051 (residual four-year limitations)
- DTPA claims: 2 years from the deceptive act or from reasonable discovery, Tex. Bus. & Com. Code § 17.565
- Insurance Code Chapter 541 / 542 claims: 2 years from the date the unfair act occurred or the date the patient knew or should have known of the unfair act, Tex. Ins. Code § 541.162
- Texas Debt Collection Act (Tex. Fin. Code Chapter 392): generally 4 years (residual)
- Sources: § 16.004 at statutes.capitol.texas.gov/Docs/CP/htm/CP.16.htm; analysis at pbateslaw.com/statute-of-limitations-breach-of-contract
Texas (unlike Tennessee at 6 years or Georgia at 6 years for written contracts) treats written and oral contracts identically at 4 years. Most hospital admissions involve a signed financial-responsibility form, so the 4-year clock runs from the day payment was due and not made.
Do not make a partial payment on a time-barred debt without legal advice, partial payment or written acknowledgment can restart the clock under common-law principles.
- Statute: Tex. Civ. Prac. & Rem. Code § 146.002
- Source: statutes.capitol.texas.gov/Docs/CP/htm/CP.146.HTM
- Substance: A health-care service provider must bill a patient (or other responsible person) for services not later than the first day of the 11th month after the date the services are provided. Late billing forfeits collection rights as to the patient.
- Practical use: When the patient receives a bill more than ~10 months after the date of service, cite § 146.002 in the dispute letter, the provider may have already forfeited collection rights. This is a strong, often-overlooked Texas-specific defense.
Texas has not enacted a state-specific medical-debt credit-reporting restriction. Patients in Texas rely on:
- The 2022-2023 voluntary changes by Equifax/Experian/TransUnion (paid medical collections removed; debt under $500 not reported; one-year delay before reporting).
- Federal FCRA dispute rights (15 U.S.C. §§ 1681i, 1681s-2).
Federal preemption posture matters here. In July 2025, the U.S. District Court for the Eastern District of Texas vacated the CFPB's medical-debt credit-reporting rule, finding that the FCRA preempts state laws restricting medical-debt credit reporting. In October 2025 the CFPB issued an interpretive rule taking the same position. If both survive challenge, they limit the effect of any state-level medical-debt credit-reporting law. Source: bhfs.com/insight/federal-court-vacates-cfpbs-medical-debt-rule-finds-fcra-preempts-state-laws; consumerlaw.berkeley.edu/news/court-overturns-federal-rule-keeps-medical-debt-credit-reports.
For deceptive furnishing of medical-debt information to credit bureaus, the DTPA and Tex. Fin. Code § 392.202 (right to demand correction of a third-party debt collector's or credit bureau's files) may apply; the patient may also have a federal FCRA claim against the furnisher.
- Statute: Tex. Health & Safety Code Chapter 61 (Indigent Health Care and Treatment Act)
- Sources: statutes.capitol.texas.gov/Docs/HS/htm/HS.61.htm; texas.public.law/statutes/tex._health_and_safety_code_title_2_subtitle_c_chapter_61
- Substance:
- Public hospitals and hospital districts must provide health-care assistance to each eligible resident in their service area who meets income and resource requirements (defined per-county; commonly ≤21% of federal poverty level under the statutory floor, but counties and hospital districts often set higher thresholds, particularly in Harris, Dallas, Bexar, Travis, and Tarrant Counties).
- Counties without a public hospital have an obligation through the county-administered indigent-care program funded in part by state assistance from the Indigent Health Care Assistance Fund (the state matches at least 90% of the actual payment for eligible-resident care once the county hits an 8% expenditure level).
- Hospital districts may set their own thresholds; many large-county districts (Harris Health, Parkland, University Health, Dell Seton, JPS) cover residents up to 200% FPL with full charity-care policies.
- Use: If the patient is a Texas resident treated at a public hospital or hospital district, this is the TX-specific charity-care lever above the federal IRS § 501(r) floor. Demand the district's eligibility policy; eligible residents have a statutory right to assistance, not just a discretionary "financial assistance" option.
- Caveat: Chapter 61 reaches public hospitals, hospital districts, and county indigent-care programs. Non-profit private hospitals are bound by IRS § 501(r) (federal) and not by Chapter 61. For-profit hospitals have no Chapter 61 obligation. Identify whether the billing entity is a public/district facility before citing Chapter 61.
Use Dollar For at dollarfor.org/state_sheet/texas for charity-care screening against any Texas hospital.
- Statute: Tex. Prop. Code Chapter 55 (Hospital and Emergency Medical Services Liens), specifically §§ 55.001-55.008
- Sources: statutes.capitol.texas.gov/Docs/PR/htm/PR.55.htm; texas.public.law/statutes/tex._prop._code_title_5_subtitle_b_chapter_55
- Substance: Hospitals and emergency-medical-services providers may file a lien for reasonable charges, but only against the patient's cause of action against a third party who caused the injury (the at-fault driver, premises owner, etc.). The lien does not attach to the patient's home, wages, or bank accounts.
- Perfection requirements:
- File a written notice of lien with the county clerk in the county where services were provided, before any settlement money is paid.
- Notice must include the name and location of the hospital/EMS provider and the name of the person alleged liable.
- Within 5 business days of recording, send written notice to the injured individual or legal representative by regular mail to their last known address.
- Patient's defenses:
- Lien does not attach if the patient was admitted more than 72 hours after the accident (§ 55.002 emergency-care window).
- Lien is reducible to "reasonable and necessary" charges, overcharges are not protected by the lien (Daughters of Charity Health Servs. v. Linnstaedter, 226 S.W.3d 409 (Tex. 2007), held a hospital that accepted workers'-compensation reimbursement could not lien for the balance).
- Failure to comply with notice or perfection requirements voids the lien.
- Use: Rarely the primary citation in a routine billing dispute. Matters when the bill stems from an accident with a third-party tortfeasor and the hospital is trying to capture the personal-injury settlement above what the patient's health insurance pays.
- Statute: Tex. Fin. Code Chapter 392 (Texas Debt Collection Act, TDCA)
- Source: statutes.capitol.texas.gov/Docs/FI/htm/FI.392.htm
- Substance: Texas's parallel to the federal FDCPA, with two key Texas-specific advantages over federal law:
- Reach to original creditors. TDCA applies to "any person who directly or indirectly engages in debt collection," including the hospital's in-house billing department, not just third-party agencies. This is broader than the federal FDCPA, which reaches only third-party collectors.
- Demand for correction of furnished credit-report information (§ 392.202): the consumer may demand that the collector or credit bureau correct inaccurate furnished information; failure to do so is a statutory violation with a minimum $100 per-violation penalty.
- Prohibited practices (Subchapter D): threats of violence, criminal prosecution, or unlawful acts; harassment (repeated calls, obscene language); contacts before 8 a.m. or after 9 p.m.; contacting third parties about the debt (except attorney, credit bureau, or limited locator inquiries); misrepresenting amount owed; adding unauthorized fees; failing to cease contact after written request.
- Civil remedies (§ 392.403):
- Injunctive relief.
- Actual damages (including mental anguish).
- Reasonable attorney's fees for prevailing plaintiff.
- Minimum $100 per violation for specific violations (§ 392.101 bond, § 392.202 file correction, § 392.301(a)(3) threats).
- DTPA tie-in: a TDCA violation is also a violation of the DTPA (Tex. Bus. & Com. Code § 17.50), giving the patient access to DTPA treble damages (up to 3x economic damages for knowing violations; up to 3x economic + mental-anguish damages for intentional violations).
- Use: Cite TDCA violations in any letter to a Texas hospital billing department or collection agency engaging in prohibited practices. Pair with DTPA § 17.50 for treble exposure.
Texas wage-garnishment law is uniquely protective: under the Texas Constitution Art. XVI § 28 and Tex. Civ. Prac. & Rem. Code § 63.004, wages for personal services cannot be garnished for ordinary consumer debts including medical bills. The only exceptions are court-ordered child support, spousal maintenance, federal student loans, and federal/state taxes. This is one of the strongest patient-side protections in the country.
Practical use: When a Texas medical-debt collector threatens wage garnishment, that threat is itself a TDCA violation (misrepresenting legal remedies), cite Tex. Const. art. XVI § 28 in the response letter.
- Statute: Tex. Bus. & Com. Code Chapter 17, Subchapter E (§§ 17.41-17.63)
- Source: statutes.capitol.texas.gov/Docs/BC/pdf/BC.17.pdf
- Substance: Broad consumer-protection statute prohibiting false, misleading, or deceptive acts in trade or commerce (§ 17.46). A patient is a "consumer" for DTPA purposes when seeking healthcare services. DTPA violations include misrepresenting standard, quality, or grade of services; failing to disclose information with intent to induce a transaction; and any "unconscionable action or course of action" (§ 17.50(a)(3)).
- Tie-ins (§ 17.50(a)(4)): DTPA absorbs violations of the Texas Insurance Code Chapter 541 and the Texas Debt Collection Act (Tex. Fin. Code Chapter 392), a single DTPA-pleaded claim can carry the underlying-statute facts plus DTPA's treble-damages remedy.
- Damages (§ 17.50(b)):
- Economic damages.
- Damages for mental anguish, plus up to 3x economic and mental-anguish damages if the violation was committed knowingly.
- If intentionally, up to 3x economic + 3x mental-anguish damages.
- Reasonable and necessary attorney's fees for prevailing consumer.
- Professional-services exemption (§ 17.49(c)): DTPA does not apply to "the rendering of a professional service the essence of which is the providing of advice, judgment, opinion, or similar professional skill", meaning the doctor's diagnostic-judgment cannot be DTPA-attacked. Exception: unconscionable acts, express misrepresentations of material fact, and breaches of express warranty are NOT exempted. Billing fraud (misrepresenting amounts, billing for services not rendered, upcoding, misrepresenting in-network status) sits outside the exemption.
- Procedural requirement (§ 17.505): 60-day pre-suit notice of the specific complaint and the amount of economic damages, mental-anguish damages, and attorney's fees claimed.
- Use: This is the patient's primary cause of action against a Texas hospital's billing department for billing fraud. Pair with Chapter 541 (insurer-side) and TDCA Chapter 392 (collector-side) as appropriate.
When the LLM renders a Texas-bound letter, substitute these defaults:
| Field | Texas value |
|---|---|
| State statute (itemization right) | Tex. Health & Safety Code § 311.002 (request-driven, 30 business days, 1-year request window) PLUS Tex. Health & Safety Code Chapter 185 (SB 490, itemization-before-collection bar for HHSC-licensed facilities) |
| State unfair-claims statute | Tex. Ins. Code Chapter 541 (private action with treble damages and attorney's fees) |
| State prompt-pay statute | Tex. Ins. Code Chapter 542, Subchapter B (18% per annum strict-liability penalty + fees) |
| State insurance department (CC line) | Texas Department of Insurance, Consumer Protection, PO Box 149091, Austin, TX 78714-9091 |
| State AG consumer protection (CC line) | Office of the Attorney General, Consumer Protection Division, P.O. Box 12548, Austin, TX 78711-2548 (consumerprotection.texasattorneygeneral.gov) |
| State hospital-licensing complaint | Texas HHSC, 1-888-973-0022 |
| Small-claims court name | Texas Justice Court ($20,000 limit) |
| Filing fee (in 30-day warning) | "$54-$100 plus service costs, depending on county and precinct" |
| Statute of limitations (in 30-day warning) | "Tex. Civ. Prac. & Rem. Code § 16.004 (four years for breach of written contract)" |
| Statute of limitations (Chapter 541/542 / DTPA) | "Tex. Ins. Code § 541.162 / Tex. Bus. & Com. Code § 17.565 (two years)" |
| Timely-billing defense (if bill ≥10 months stale) | "Tex. Civ. Prac. & Rem. Code § 146.002, provider must bill no later than the first day of the 11th month after services" |
| Wage-garnishment defense | "Tex. Const. art. XVI § 28; Tex. Civ. Prac. & Rem. Code § 63.004, wages not garnishable for consumer debt" |
| Ground-ambulance balance bill (covered period through 2027-09-01) | "Tex. Ins. Code Chapter 1271 et al., as added by SB 2476 (2023) and extended by SB 916 (2025)" |
| Pre-suit notice (Chapter 541) | 61 days before filing, identifying specific complaint, actual damages, and attorney's fees incurred |
| Pre-suit notice (DTPA) | 60 days before filing under § 17.505 |
Worth keeping in mind when triaging a TX patient's bills:
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Chapter 541 private right of action with treble damages. This is the headline Texas advantage and the single biggest structural difference from Tennessee and Georgia. The 60-day notice letter under § 541.154 is itself a powerful settlement lever, most insurers prefer to pay the underlying claim than face treble exposure plus attorney's fees. Always cite § 541.060 (specific unfair practice) plus § 541.151 (private right of action) plus § 541.152(b) (knowing-violation treble) in any Texas insurer letter.
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Chapter 542 strict-liability 18% penalty. One day late triggers liability with no bad-faith showing required. Calculation is mechanical. Insurers cannot argue around it the way they can around a discretionary-bad-faith claim. Pair Chapter 541 + Chapter 542 in every insurer dispute letter for maximum leverage.
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SB 490 / Chapter 185, itemization is a collection prerequisite. For any HHSC-licensed facility (hospitals, ASCs, freestanding ERs) seeking to collect after September 1, 2023, non-compliance with the itemized-billing requirement is a complete defense to collection. If the bill the patient received is not Chapter 185-compliant, the collection action cannot proceed until the provider cures. Always demand a Chapter 185-compliant itemized bill from a Texas facility as step one.
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DTPA treble + attorney's fees. Texas's DTPA absorbs Chapter 541 and Chapter 392 violations and adds its own treble-damages exposure. A single DTPA-pleaded count carries broader leverage than any single underlying statute. Patient is a "consumer" for DTPA purposes when receiving healthcare services; the professional-services exemption does not shield billing fraud.
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TDCA reaches the original creditor. Tex. Fin. Code Chapter 392 applies to the hospital's in-house billing department, not just third-party collectors. The federal FDCPA does not. This closes the federal gap for original-creditor abuses.
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Wage garnishment is constitutionally barred. Tex. Const. art. XVI § 28 makes wages for personal services unreachable by ordinary consumer-debt creditors including medical-debt creditors. A collector threatening garnishment is itself committing a TDCA / DTPA violation. This is one of the most consumer-protective garnishment regimes in the country.
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§ 146.002 timely-billing defense. A provider that bills the patient later than the first day of the 11th month after services forfeits collection rights. Often overlooked; especially useful in cases where the patient received the bill long after the date of service.
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Texas IDR for state-regulated plans. Patients in state-regulated plans (including ERS and TRS state-employee/teacher plans) get a more pro-patient state IDR than the federal NSA IDR in many disputed cases. The patient is held harmless from the rate dispute either way.
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$20,000 Justice Court limit. Higher than many states' small-claims caps; covers most hospital bills. Justice Court is pro-se-friendly and corporations may appear without an attorney. Strong forum for self-represented patients.
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Texas Indigent Health Care and Treatment Act for public-hospital patients. Patients of public hospitals, hospital districts (Harris Health, Parkland, University Health, Dell Seton, JPS), and county indigent-care programs have a statutory right to assistance under Chapter 61, not just a discretionary financial-assistance policy. Always identify the billing entity's status before citing.