Texas 2009 - 81st Regular

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11 81R4816 KCR-F
22 By: Duncan, Nelson S.B. No. 6
33
44
55 A BILL TO BE ENTITLED
66 AN ACT
77 relating to the creation of the Healthy Texas Program.
88 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
99 SECTION 1. Subtitle G, Title 8, Insurance Code, is amended
1010 by adding Chapter 1508 to read as follows:
1111 CHAPTER 1508. HEALTHY TEXAS PROGRAM
1212 SUBCHAPTER A. GENERAL PROVISIONS
1313 Sec. 1508.001. PURPOSE. (a) The purposes of the Healthy
1414 Texas Program are to:
1515 (1) provide access to quality small employer health
1616 benefit plans at an affordable price;
1717 (2) encourage small employers to offer health benefit
1818 plan coverage to employees and the dependents of employees; and
1919 (3) maximize reliance on proven managed care
2020 strategies and procedures.
2121 (b) The Healthy Texas Program is not intended to diminish
2222 the availability of traditional small employer health benefit plan
2323 coverage under Chapter 1501.
2424 Sec. 1508.002. DEFINITIONS. In this chapter:
2525 (1) "Dependent" has the meaning assigned by Section
2626 1501.002(2).
2727 (2) "Eligible employee" has the meaning assigned by
2828 Section 1501.002(3).
2929 (3) "Fund" means the healthy Texas small employer
3030 premium stabilization fund established under Subchapter F.
3131 (4) "Health benefit plan" and "health benefit plan
3232 issuer" have the meanings assigned by Sections 1501.002(5) and
3333 1501.002(6), respectively.
3434 (5) "Program" means the Healthy Texas Program
3535 established under this chapter.
3636 (6) "Qualifying health benefit plan" means a health
3737 benefit plan that provides benefits for health care services in the
3838 manner described by this chapter.
3939 (7) "Small employer" has the meaning assigned by
4040 Section 1501.002(14).
4141 Sec. 1508.003. RULES. The commissioner may adopt rules as
4242 necessary to implement this chapter.
4343 [Sections 1508.004-1508.050 reserved for expansion]
4444 SUBCHAPTER B. EMPLOYER ELIGIBILITY; CONTRIBUTIONS
4545 Sec. 1508.051. EMPLOYER ELIGIBILITY TO PARTICIPATE. (a) A
4646 small employer may participate in the program if:
4747 (1) during the 12-month period immediately preceding
4848 the date of application for a qualifying health benefit plan, the
4949 small employer does not offer employees group health benefits on an
5050 expense-reimbursed or prepaid basis; and
5151 (2) at least 30 percent of the small employer's
5252 eligible employees receive annual wages from the employer in an
5353 amount that is equal to or less than 300 percent of the poverty
5454 guidelines for an individual, as defined and updated annually by
5555 the United States Department of Health and Human Services.
5656 (b) A small employer ceases to be eligible to participate in
5757 the program if any health benefit plan that provides employee
5858 benefits on an expense-reimbursed or prepaid basis, other than
5959 another qualifying health benefit plan, is purchased or otherwise
6060 takes effect after the purchase of a qualifying health benefit
6161 plan.
6262 Sec. 1508.052. COMMISSIONER ADJUSTMENTS AUTHORIZED. (a)
6363 The commissioner by rule may adjust the 12-month period described
6464 by Section 1508.051(a)(1) to an 18-month period if the commissioner
6565 determines that the 12-month period is insufficient to prevent
6666 inappropriate substitution of other health benefit plans for
6767 qualifying health benefit plan coverage under this chapter.
6868 (b) The commissioner by rule may adjust the percentage of
6969 the poverty guidelines described by Section 1508.051(a)(2) to a
7070 higher or lower percentage if the commissioner determines that the
7171 adjustment is necessary to fulfill the purposes of this chapter. An
7272 adjustment made by the commissioner under this subsection takes
7373 effect on the first July 1 following the adjustment.
7474 Sec. 1508.053. MINIMUM EMPLOYER PARTICIPATION
7575 REQUIREMENTS. A small employer that meets the eligibility
7676 requirements described by Section 1508.051(a) may apply to purchase
7777 a qualifying health benefit plan if 60 percent or more of the
7878 employer's eligible employees elect to participate in the plan.
7979 Sec. 1508.054. EMPLOYER CONTRIBUTION REQUIREMENTS. (a) A
8080 small employer that purchases a qualifying health benefit plan
8181 must:
8282 (1) pay 50 percent or more of the premium for each
8383 employee covered under the qualifying health benefit plan;
8484 (2) offer coverage to all eligible employees receiving
8585 annual wages from the employer in an amount described by Section
8686 1508.051(a)(2) or 1508.052(b), as applicable; and
8787 (3) contribute the same percentage of premium for each
8888 covered employee.
8989 (b) A small employer that purchases a qualifying health
9090 benefit plan under the program may elect to pay, but is not required
9191 to pay, all or any portion of the premium paid for dependent
9292 coverage under the qualifying health benefit plan.
9393 [Sections 1508.055-1508.100 reserved for expansion]
9494 SUBCHAPTER C. PROGRAM PARTICIPATION; REQUIRED COVERAGE AND
9595 BENEFITS
9696 Sec. 1508.101. PARTICIPATING PLAN ISSUERS. (a) Subject to
9797 Subsection (b), any health benefit plan issuer may participate in
9898 the program.
9999 (b) The commissioner by rule may limit which health benefit
100100 plan issuers may participate in the program if the commissioner
101101 determines that the limitation is necessary to achieve the purposes
102102 of this chapter.
103103 (c) If the commissioner limits participation in the program
104104 under Subsection (b), the commissioner shall contract on a
105105 competitive procurement basis with one or more health benefit plan
106106 issuers to provide qualifying health benefit plan coverage under
107107 the program.
108108 Sec. 1508.102. PREEXISTING CONDITION PROVISION REQUIRED. A
109109 health benefit plan offered under the program must include a
110110 preexisting condition provision that meets the requirements
111111 described by Section 1501.102.
112112 Sec. 1508.103. EXCEPTION FROM MANDATED BENEFIT
113113 REQUIREMENTS. Except as expressly provided by this chapter, a
114114 small employer health benefit plan issued under the program is not
115115 subject to a law of this state that requires coverage or the offer
116116 of coverage of a health care service or benefit.
117117 Sec. 1508.104. CERTAIN COVERAGE PROHIBITED OR REQUIRED.
118118 (a) A qualifying health benefit plan may only provide coverage for
119119 in-plan services and benefits, except for:
120120 (1) emergency care; or
121121 (2) other services not available through a plan
122122 provider.
123123 (b) In-plan services and benefits provided under a
124124 qualifying health benefit plan must include the following:
125125 (1) inpatient hospital services;
126126 (2) outpatient hospital services;
127127 (3) physician services; and
128128 (4) prescription drug benefits.
129129 (c) The commissioner may approve in-plan benefits other
130130 than those required under Subsection (b) or emergency care or other
131131 services not available through a plan provider if the commissioner
132132 determines the inclusion to be essential to achieve the purposes of
133133 this chapter.
134134 (d) The commissioner may, with respect to the categories of
135135 services and benefits described by Subsections (b) and (c):
136136 (1) prepare specifications for a coverage provided
137137 under this chapter;
138138 (2) determine the methods and procedures of claims
139139 administration;
140140 (3) establish procedures to decide contested cases
141141 arising from coverage provided under this chapter;
142142 (4) study, on an ongoing basis, the operation of all
143143 coverages provided under this chapter, including gross and net
144144 costs, administration costs, benefits, utilization of benefits,
145145 and claims administration;
146146 (5) administer the healthy Texas small employer
147147 premium stabilization fund established under Subchapter F;
148148 (6) provide the beginning and ending dates of
149149 coverages for enrollees in a qualifying health benefit plan;
150150 (7) develop basic group coverage plans applicable to
151151 all individuals eligible to participate in the program;
152152 (8) provide for optional group coverage plans in
153153 addition to the basic group coverage plans described by Subdivision
154154 (7);
155155 (9) provide, as determined to be appropriate by the
156156 commissioner, additional statewide optional coverage plans;
157157 (10) develop specific health benefit plans that permit
158158 access to high-quality, cost-effective health care;
159159 (11) design, implement, and monitor health benefit
160160 plan features intended to discourage excessive utilization,
161161 promote efficiency, and contain costs for qualifying health benefit
162162 plans;
163163 (12) develop and refine, on an ongoing basis, a health
164164 benefit strategy for the program that is consistent with evolving
165165 benefits delivery systems;
166166 (13) develop a funding strategy that efficiently uses
167167 employer contributions to achieve the purposes of this chapter; and
168168 (14) modify the copayment and deductible amounts for
169169 prescription drug benefits under a qualifying health benefit plan,
170170 if the commissioner determines that the modification is necessary
171171 to achieve the purposes of this chapter.
172172 [Sections 1508.105-1508.150 reserved for expansion]
173173 SUBCHAPTER D. PROGRAM ADMINISTRATION
174174 Sec. 1508.151. EMPLOYER CERTIFICATION. (a) At the time of
175175 initial application, a health benefit plan issuer shall obtain from
176176 a small employer that seeks to purchase a qualifying health benefit
177177 plan a written certification that the employer meets the
178178 eligibility requirements described by Section 1508.051 and the
179179 minimum employer participation requirements described by Section
180180 1508.053.
181181 (b) Not later than the 90th day before the renewal date of a
182182 qualifying health benefit plan, a health benefit plan issuer shall
183183 obtain from the small employer that purchased the qualifying health
184184 benefit plan a written certification that the employer continues to
185185 meet the eligibility requirements described by Section 1508.051 and
186186 the minimum employer participation requirements described by
187187 Section 1508.053.
188188 (c) A participating health benefit plan issuer may require a
189189 small employer to submit appropriate documentation in support of a
190190 certification described by Subsection (a) or (b).
191191 Sec. 1508.152. APPLICATION PROCESS. (a) Subject to
192192 Subsection (b), a health benefit plan issuer shall accept
193193 applications for qualifying health benefit plan coverage from small
194194 employers at all times throughout the calendar year.
195195 (b) The commissioner may limit the dates on which a health
196196 benefit plan issuer must accept applications for qualifying health
197197 benefit plan coverage if the commissioner determines the limitation
198198 to be necessary to achieve the purposes of this chapter.
199199 Sec. 1508.153. EMPLOYEE ENROLLMENT; WAITING PERIOD. (a) A
200200 qualifying health benefit plan must provide employees with an
201201 initial enrollment period that is 31 days or longer, and annually at
202202 least one open enrollment period that is 31 days or longer. The
203203 commissioner by rule may require an additional open enrollment
204204 period if the commissioner determines that the additional open
205205 enrollment period is necessary to achieve the purposes of this
206206 chapter.
207207 (b) A small employer may establish a waiting period for
208208 employees during which an employee is not eligible for coverage
209209 under a qualifying health benefit plan. The last day of a waiting
210210 period established under this subsection may not be later than the
211211 90th day after the date on which the employee begins employment
212212 with the small employer.
213213 (c) A health benefit plan issuer may not deny coverage under
214214 a qualifying health benefit plan to a new employee of a small
215215 employer that purchased the qualifying health benefit plan if the
216216 health benefit plan issuer receives an application for coverage
217217 from the employee not later than the 31st day after the latter of:
218218 (1) the first day of the employee's employment; or
219219 (2) the first day after the expiration of a waiting
220220 period established under Subsection (b).
221221 (d) Subject to Subsection (e), a health benefit plan issuer
222222 may deny coverage under a qualifying health benefit plan to an
223223 employee of a small employer who applies for coverage after the
224224 period described by Subsection (c).
225225 (e) A health benefit plan issuer that denies an employee
226226 coverage under Subsection (d):
227227 (1) may only deny the employee coverage until the next
228228 open enrollment period; and
229229 (2) may subject the enrollee to a one-year preexisting
230230 condition provision, as described by Section 1508.102, if the
231231 period during which the preexisting condition provision applies
232232 does not exceed 18 months from the date of the initial application
233233 for coverage under the qualifying health benefit plan.
234234 Sec. 1508.154. REPORTS. A health benefit plan issuer that
235235 participates in the program shall submit reports to the department
236236 in the form and at the time the commissioner prescribes.
237237 [Sections 1508.155-1508.200 reserved for expansion]
238238 SUBCHAPTER E. RATING OF QUALIFIED HEALTH BENEFIT PLANS
239239 Sec. 1508.201. RATING; PREMIUM PRACTICES IN GENERAL. (a) A
240240 health benefit plan issuer participating in the program must:
241241 (1) use rating practices for qualifying health benefit
242242 plans that are consistent with the purposes of this chapter; and
243243 (2) in setting premiums for qualifying health benefit
244244 plans, consider the availability of reimbursement from the fund.
245245 (b) A health benefit plan issuer participating in the
246246 program shall apply rating factors consistently with respect to all
247247 small employers in a class of business.
248248 (c) Differences in premium rates charged for qualifying
249249 health benefit plans must be reasonable and reflect objective
250250 differences in plan design.
251251 Sec. 1508.202. PREMIUM RATE DEVELOPMENT AND CALCULATION.
252252 (a) Rating factors used to underwrite qualifying health benefit
253253 plans must produce premium rates for identical groups that:
254254 (1) differ only by the amounts attributable to health
255255 benefit plan design; and
256256 (2) do not reflect differences because of the nature
257257 of the groups assumed to select a particular health benefit plan.
258258 (b) A health benefit plan issuer shall treat each qualifying
259259 health benefit plan that is issued or renewed in a calendar month as
260260 having the same rating period.
261261 (c) A health benefit plan issuer may use only age and gender
262262 as case characteristics, as defined by Section 1501.201(2), in
263263 setting premium rates for a qualifying health benefit plan.
264264 (d) The commissioner by rule may establish additional
265265 rating criteria and requirements for qualifying health benefit
266266 plans if the commissioner determines that the criteria and
267267 requirements are necessary to achieve the purposes of this chapter.
268268 Sec. 1508.203. FILING; APPROVAL. (a) A health benefit plan
269269 issuer shall file with the department, for review and approval by
270270 the commissioner, premium rates to be charged for qualifying health
271271 benefit plans.
272272 (b) If the commissioner limits health benefit plan issuer
273273 participation in the program under Section 1508.101(b), premium
274274 rates proposed to be charged for each qualifying health benefit
275275 plan will be considered as an element in the contract procurement
276276 process required under that section.
277277 [Sections 1508.204-1508.250 reserved for expansion]
278278 SUBCHAPTER F. HEALTHY TEXAS SMALL EMPLOYER PREMIUM STABILIZATION
279279 FUND
280280 Sec. 1508.251. ESTABLISHMENT OF FUND. (a) To the extent
281281 that funds appropriated to the department are available for this
282282 purpose, the commissioner shall establish a fund from which health
283283 benefit plan issuers may receive reimbursement for claims paid by
284284 the health benefit plan issuers for individuals covered under
285285 qualifying group health plans.
286286 (b) The fund established under this section shall be known
287287 as the healthy Texas small employer premium stabilization fund.
288288 (c) The commissioner shall adopt rules necessary to
289289 implement and administer the fund, including rules that set out the
290290 procedures for operation of the fund and distribution of money from
291291 the fund.
292292 Sec. 1508.252. OPERATION OF FUND; CLAIM ELIGIBILITY. (a) A
293293 health benefit plan issuer is eligible to receive reimbursement in
294294 an amount that is equal to 80 percent of the dollar amount of claims
295295 paid between $5,000 and $75,000 in a calendar year for an enrollee
296296 in a qualifying health benefit plan.
297297 (b) A health benefit plan issuer is eligible for
298298 reimbursement from the fund only for the calendar year in which
299299 claims are paid.
300300 (c) Once the dollar amount of claims paid on behalf of a
301301 covered individual reaches or exceeds $75,000 in a given calendar
302302 year, a health benefit plan issuer may not receive reimbursement
303303 for any other claims paid on behalf of the individual in that
304304 calendar year.
305305 Sec. 1508.253. REIMBURSEMENT REQUEST SUBMISSION. (a) A
306306 health benefit plan issuer seeking reimbursement from the fund
307307 shall submit a request for reimbursement in the form prescribed by
308308 the commissioner by rule.
309309 (b) A health benefit plan issuer must request reimbursement
310310 from the fund annually, not later than the date determined by the
311311 commissioner, following the end of the calendar year for which the
312312 reimbursement requests are made.
313313 (c) The commissioner may require a health benefit plan
314314 issuer participating in the program to submit claims data in
315315 connection with reimbursement requests as the commissioner
316316 determines to be necessary to ensure appropriate distribution of
317317 reimbursement funds and oversee the operation of the fund. The
318318 commissioner may require that the data be submitted on a per covered
319319 individual, aggregate, or categorical basis.
320320 Sec. 1508.254. FUND AVAILABILITY. (a) The commissioner
321321 shall compute the total claims reimbursement amount for all health
322322 benefit plan issuers participating in the program for the calendar
323323 year for which claims are reported and reimbursement requested.
324324 (b) If the total amount requested by health benefit plan
325325 issuers participating in the program for reimbursement for a
326326 calendar year exceeds the amount of funds available for
327327 distribution for claims paid during that same calendar year, the
328328 commissioner shall provide for the pro rata distribution of any
329329 available funds. A health benefit plan issuer participating in the
330330 program is eligible to receive a proportional amount of any
331331 available funds that is equal to the proportion of total eligible
332332 claims paid by all participating health benefit plan issuers that
333333 the requesting health benefit plan issuer paid.
334334 (c) If the amount of funds available for distribution for
335335 claims paid by all health benefit plan issuers participating in the
336336 program during a calendar year exceeds the total amount requested
337337 for reimbursement by all participating health benefit plan issuers
338338 during that calendar year, the commissioner shall carry forward any
339339 excess funds and make those excess funds available for distribution
340340 in the next calendar year. Excess funds carried over under this
341341 section are added to the fund in addition to any other money
342342 appropriated for the fund for the calendar year into which the funds
343343 are carried forward.
344344 Sec. 1508.255. PROGRAM REPORTING. (a) Each health benefit
345345 plan issuer participating in the program shall provide the
346346 department, in the form prescribed by the commissioner, monthly
347347 reports of total enrollment under qualifying health benefit plans.
348348 (b) On the request of the commissioner, each health benefit
349349 plan issuer participating in the program shall furnish to the
350350 department, in the form prescribed by the commissioner, data other
351351 than data described by Subsection (a) that the commissioner
352352 determines necessary to oversee the operation of the fund.
353353 Sec. 1508.256. CLAIMS EXPERIENCE DATA. (a) Based on
354354 available data and appropriate actuarial assumptions, the
355355 commissioner shall separately estimate the per covered individual
356356 annual cost of total claims reimbursement from the fund for
357357 qualifying health benefit plans.
358358 (b) On request, a health benefit plan issuer participating
359359 in the program shall furnish to the department claims experience
360360 data for use in the estimates described by Subsection (a).
361361 Sec. 1508.257. TOTAL ELIGIBLE ENROLLMENT DETERMINATION.
362362 The commissioner shall determine total eligible enrollment under
363363 qualifying health benefit plans by dividing the total funds
364364 available for distribution from the fund by the estimated per
365365 covered individual annual cost of total claims reimbursement from
366366 the fund.
367367 Sec. 1508.258. EVALUATION AND PROTECTION OF FUND; EMPLOYER
368368 ENROLLMENT SUSPENSION. (a) The commissioner shall suspend the
369369 enrollment of new employers in qualifying health benefit plans if
370370 the commissioner determines that the total enrollment reported by
371371 all health benefit plan issuers under qualifying health benefit
372372 plans exceeds the total eligible enrollment determined under
373373 Section 1508.257 and is likely to result in anticipated annual
374374 expenditures from the fund in excess of the total funds available
375375 for distribution from the fund.
376376 (b) The commissioner shall provide a health benefit plan
377377 issuer participating in the program with notification of any
378378 enrollment suspension under Subsection (a) as soon as practicable
379379 after:
380380 (1) receipt of all enrollment data; and
381381 (2) determination of the need to suspend enrollment.
382382 (c) A suspension of issuance of qualifying health benefit
383383 plans to employers under Subsection (a) does not preclude the
384384 addition of new employees of an employer already covered under a
385385 qualifying health benefit plan or new dependents of employees
386386 already covered under a qualifying health benefit plan.
387387 Sec. 1508.259. EMPLOYER ENROLLMENT REACTIVATION. If, at
388388 any point during a suspension of enrollment under Section 1508.258,
389389 the commissioner determines that funds are sufficient to provide
390390 for the addition of new enrollments, the commissioner:
391391 (1) may reactivate new enrollments; and
392392 (2) shall notify all participating group health
393393 benefit plan issuers that enrollment of new employers may be
394394 resumed.
395395 Sec. 1508.260. FUND ADMINISTRATOR. (a) The commissioner
396396 may obtain the services of an independent organization to
397397 administer the fund.
398398 (b) The commissioner shall establish guidelines for the
399399 submission of proposals by organizations for the purposes of
400400 administering the fund and may approve, disapprove, or recommend
401401 modification to the proposal of an applicant to administer the
402402 fund.
403403 (c) An organization approved to administer the fund shall
404404 submit reports to the commissioner, in the form and at the times
405405 required by the commissioner, as necessary to facilitate evaluation
406406 and ensure orderly operation of the fund, including an annual
407407 report of the affairs and operations of the fund. The annual report
408408 must also be delivered to the governor, the lieutenant governor,
409409 and the speaker of the house of representatives.
410410 (d) An organization approved to administer the fund shall
411411 maintain records in the form prescribed by the commissioner and
412412 make those records available for inspection by or at the request of
413413 the commissioner.
414414 (e) The commissioner shall determine the amount of
415415 compensation to be allocated to an approved organization as payment
416416 for fund administration. Compensation is payable only from the
417417 fund.
418418 (f) The commissioner may remove an organization approved to
419419 administer the fund from fund administration. An organization
420420 removed from fund administration under this subsection must
421421 cooperate in the orderly transition of services to another approved
422422 organization or to the commissioner.
423423 Sec. 1508.261. STOP-LOSS INSURANCE; REINSURANCE. (a) The
424424 administrator of the fund, on behalf of and with the prior approval
425425 of the commissioner, may purchase stop-loss insurance or
426426 reinsurance from an insurance company licensed to write that
427427 coverage in this state.
428428 (b) Stop-loss insurance or reinsurance may be purchased to
429429 the extent that the commissioner determines funds are available for
430430 the purchase of that insurance.
431431 Sec. 1508.262. PUBLIC EDUCATION AND OUTREACH. (a) The
432432 commissioner may use an amount of the fund, not to exceed eight
433433 percent of the annual amount of the fund, for purposes of developing
434434 and implementing public education, outreach, and facilitated
435435 enrollment strategies targeted to small employers who do not
436436 provide health insurance.
437437 (b) The commissioner may contract with marketing
438438 organizations to perform or provide assistance with education,
439439 outreach, and enrollment strategies described by Subsection (a).
440440 SECTION 2. The commissioner of insurance shall adopt any
441441 rules necessary to implement the change in law made by this Act not
442442 later than January 4, 2010.
443443 SECTION 3. (a) The commissioner of insurance shall make an
444444 initial determination concerning limitation of health benefit plan
445445 issuer participation in the program established under Chapter 1508,
446446 Insurance Code, as added by this Act, not later than January 18,
447447 2010. If the commissioner determines that limited participation is
448448 necessary to achieve the purposes of Chapter 1508, Insurance Code,
449449 as added by this Act, the commissioner shall issue a request for
450450 proposal from health benefit plan issuers to participate in the
451451 program not later than May 1, 2010.
452452 (b) The commissioner shall ensure that the Healthy Texas
453453 Program is fully operational in a manner that allows health benefit
454454 plan issuers participating in the program to make the first annual
455455 request for reimbursement on January 1, 2011.
456456 SECTION 4. This Act takes effect September 1, 2009.