By: Nelson S.R. No. 1101
SENATE RESOLUTION
BE IT RESOLVED by the Senate of the State of Texas, 81st
Legislature, Regular Session, 2009, That Senate Rule 12.03 be
suspended in part as provided by Senate Rule 12.08 to enable the
conference committee appointed to resolve the differences on
Senate Bill No. 78, relating to promoting awareness and education
about the purchase and availability of health coverage, to
consider and take action on the following matter:
Senate Rule 12.03(4) is suspended to permit the committee
to add text that is not in disagreement to Subtitle G, Title 8,
Insurance Code, by adding Chapter 1508 to read as follows:
ARTICLE 2. HEALTHY TEXAS PROGRAM
SECTION 2.01. Subtitle G, Title 8, Insurance Code, is
amended by adding Chapter 1508 to read as follows:
CHAPTER 1508. HEALTHY TEXAS PROGRAM
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1508.001. PURPOSE. (a) The purposes of the Healthy
Texas Program are to:
(1) provide access to quality small employer health
benefit plans at an affordable price;
(2) encourage small employers to offer health
benefit plan coverage to employees and the dependents of
employees; and
(3) maximize reliance on proven managed care
strategies and procedures.
(b) The Healthy Texas Program is not intended to diminish
the availability of traditional small employer health benefit
plan coverage under Chapter 1501.
Sec. 1508.002. DEFINITIONS. In this chapter:
(1) "Dependent" has the meaning assigned by Section
1501.002(2).
(2) "Eligible employee" has the meaning assigned by
Section 1501.002(3).
(3) "Fund" means the healthy Texas small employer
premium stabilization fund established under Subchapter F.
(4) "Health benefit plan" and "health benefit plan
issuer" have the meanings assigned by Sections 1501.002(5) and
1501.002(6), respectively.
(5) "Program" means the Healthy Texas Program
established under this chapter.
(6) "Qualifying health benefit plan" means a health
benefit plan that provides benefits for health care services in
the manner described by this chapter.
(7) "Small employer" has the meaning assigned by
Section 1501.002(14).
Sec. 1508.003. RULES. The commissioner may adopt rules
as necessary to implement this chapter.
[Sections 1508.004-1508.050 reserved for expansion]
SUBCHAPTER B. EMPLOYER ELIGIBILITY; CONTRIBUTIONS
Sec. 1508.051. EMPLOYER ELIGIBILITY TO PARTICIPATE.
(a) A small employer may participate in the program if:
(1) during the 12-month period immediately
preceding the date of application for a qualifying health benefit
plan, the small employer does not offer employees group health
benefits on an expense-reimbursed or prepaid basis; and
(2) at least 30 percent of the small employer's
eligible employees receive annual wages from the employer in an
amount that is equal to or less than 300 percent of the poverty
guidelines for an individual, as defined and updated annually by
the United States Department of Health and Human Services.
(b) A small employer ceases to be eligible to participate
in the program if any health benefit plan that provides employee
benefits on an expense-reimbursed or prepaid basis, other than
another qualifying health benefit plan, is purchased or
otherwise takes effect after the purchase of a qualifying health
benefit plan.
Sec. 1508.052. COMMISSIONER ADJUSTMENTS AUTHORIZED.
(a) The commissioner by rule may adjust the 12-month period
described by Section 1508.051(a)(1) to an 18-month period if the
commissioner determines that the 12-month period is insufficient
to prevent inappropriate substitution of other health benefit
plans for qualifying health benefit plan coverage under this
chapter.
(b) The commissioner by rule may adjust the percentage of
the poverty guidelines described by Section 1508.051(a)(2) to a
higher or lower percentage if the commissioner determines that
the adjustment is necessary to fulfill the purposes of this
chapter. An adjustment made by the commissioner under this
subsection takes effect on the first July 1 following the
adjustment.
Sec. 1508.053. MINIMUM EMPLOYER PARTICIPATION
REQUIREMENTS. A small employer that meets the eligibility
requirements described by Section 1508.051(a) may apply to
purchase a qualifying health benefit plan if 60 percent or more
of the employer's eligible employees elect to participate in the
plan.
Sec. 1508.054. EMPLOYER CONTRIBUTION REQUIREMENTS.
(a) A small employer that purchases a qualifying health benefit
plan must:
(1) pay 50 percent or more of the premium for each
employee covered under the qualifying health benefit plan;
(2) offer coverage to all eligible employees
receiving annual wages from the employer in an amount described
by Section 1508.051(a)(2) or 1508.052(b), as applicable; and
(3) contribute the same percentage of premium for
each covered employee.
(b) A small employer that purchases a qualifying health
benefit plan under the program may elect to pay, but is not
required to pay, all or any portion of the premium paid for
dependent coverage under the qualifying health benefit plan.
[Sections 1508.055-1508.100 reserved for expansion]
SUBCHAPTER C. PROGRAM PARTICIPATION; REQUIRED COVERAGE AND
BENEFITS
Sec. 1508.101. PARTICIPATING PLAN ISSUERS. (a) Subject
to Subsection (b), any health benefit plan issuer may participate
in the program.
(b) The commissioner by rule may limit which health
benefit plan issuers may participate in the program if the
commissioner determines that the limitation is necessary to
achieve the purposes of this chapter.
(c) If the commissioner limits participation in the
program under Subsection (b), the commissioner shall contract on
a competitive procurement basis with one or more health benefit
plan issuers to provide qualifying health benefit plan coverage
under the program.
(d) Nothing in this chapter prohibits a regional or local
health care program described by Chapter 75, Health and Safety
Code, from participating in the program. The commissioner by
rule shall establish participation requirements applicable to
regional and local health care programs that consider the unique
plan designs, benefit levels, and participation criteria of each
program.
Sec. 1508.102. PREEXISTING CONDITION PROVISION
REQUIRED. A health benefit plan offered under the program must
include a preexisting condition provision that meets the
requirements described by Section 1501.102.
Sec. 1508.103. EXCEPTION FROM MANDATED BENEFIT
REQUIREMENTS. Except as expressly provided by this chapter, a
small employer health benefit plan issued under the program is
not subject to a law of this state that requires coverage or the
offer of coverage of a health care service or benefit.
Sec. 1508.104. CERTAIN COVERAGE PROHIBITED OR REQUIRED.
(a) A qualifying health benefit plan may only provide coverage
for in-plan services and benefits, except for:
(1) emergency care; or
(2) other services not available through a plan
provider.
(b) In-plan services and benefits provided under a
qualifying health benefit plan must include the following:
(1) inpatient hospital services;
(2) outpatient hospital services;
(3) physician services; and
(4) prescription drug benefits.
(c) The commissioner may approve in-plan benefits other
than those required under Subsection (b) or emergency care or
other services not available through a plan provider if the
commissioner determines the inclusion to be essential to achieve
the purposes of this chapter.
(d) The commissioner may, with respect to the categories
of services and benefits described by Subsections (b) and (c):
(1) prepare specifications for a coverage provided
under this chapter;
(2) determine the methods and procedures of claims
administration;
(3) establish procedures to decide contested cases
arising from coverage provided under this chapter;
(4) study, on an ongoing basis, the operation of all
coverages provided under this chapter, including gross and net
costs, administration costs, benefits, utilization of benefits,
and claims administration;
(5) administer the healthy Texas small employer
premium stabilization fund established under Subchapter F;
(6) provide the beginning and ending dates of
coverages for enrollees in a qualifying health benefit plan;
(7) develop basic group coverage plans applicable
to all individuals eligible to participate in the program;
(8) provide for optional group coverage plans in
addition to the basic group coverage plans described by
Subdivision (7);
(9) provide, as determined to be appropriate by the
commissioner, additional statewide optional coverage plans;
(10) develop specific health benefit plans that
permit access to high-quality, cost-effective health care;
(11) design, implement, and monitor health benefit
plan features intended to discourage excessive utilization,
promote efficiency, and contain costs for qualifying health
benefit plans;
(12) develop and refine, on an ongoing basis, a
health benefit strategy for the program that is consistent with
evolving benefits delivery systems;
(13) develop a funding strategy that efficiently
uses employer contributions to achieve the purposes of this
chapter; and
(14) modify the copayment and deductible amounts
for prescription drug benefits under a qualifying health benefit
plan, if the commissioner determines that the modification is
necessary to achieve the purposes of this chapter.
[Sections 1508.105-1508.150 reserved for expansion]
SUBCHAPTER D. PROGRAM ADMINISTRATION
Sec. 1508.151. EMPLOYER CERTIFICATION. (a) At the time
of initial application, a health benefit plan issuer shall obtain
from a small employer that seeks to purchase a qualifying health
benefit plan a written certification that the employer meets the
eligibility requirements described by Section 1508.051 and the
minimum employer participation requirements described by Section
1508.053.
(b) Not later than the 90th day before the renewal date of
a qualifying health benefit plan, a health benefit plan issuer
shall obtain from the small employer that purchased the
qualifying health benefit plan a written certification that the
employer continues to meet the eligibility requirements
described by Section 1508.051 and the minimum employer
participation requirements described by Section 1508.053.
(c) A participating health benefit plan issuer may
require a small employer to submit appropriate documentation in
support of a certification described by Subsection (a) or (b).
Sec. 1508.152. APPLICATION PROCESS. (a) Subject to
Subsection (b), a health benefit plan issuer shall accept
applications for qualifying health benefit plan coverage from
small employers at all times throughout the calendar year.
(b) The commissioner may limit the dates on which a
health benefit plan issuer must accept applications for
qualifying health benefit plan coverage if the commissioner
determines the limitation to be necessary to achieve the purposes
of this chapter.
Sec. 1508.153. EMPLOYEE ENROLLMENT; WAITING PERIOD.
(a) A qualifying health benefit plan must provide employees
with an initial enrollment period that is 31 days or longer, and
annually at least one open enrollment period that is 31 days or
longer. The commissioner by rule may require an additional open
enrollment period if the commissioner determines that the
additional open enrollment period is necessary to achieve the
purposes of this chapter.
(b) A small employer may establish a waiting period for
employees during which an employee is not eligible for coverage
under a qualifying health benefit plan. The last day of a waiting
period established under this subsection may not be later than
the 90th day after the date on which the employee begins
employment with the small employer.
(c) A health benefit plan issuer may not deny coverage
under a qualifying health benefit plan to a new employee of a
small employer that purchased the qualifying health benefit plan
if the health benefit plan issuer receives an application for
coverage from the employee not later than the 31st day after the
latter of:
(1) the first day of the employee's employment; or
(2) the first day after the expiration of a waiting
period established under Subsection (b).
(d) Subject to Subsection (e), a health benefit plan
issuer may deny coverage under a qualifying health benefit plan
to an employee of a small employer who applies for coverage after
the period described by Subsection (c).
(e) A health benefit plan issuer that denies an employee
coverage under Subsection (d):
(1) may only deny the employee coverage until the
next open enrollment period; and
(2) may subject the enrollee to a one-year
preexisting condition provision, as described by Section
1508.102, if the period during which the preexisting condition
provision applies does not exceed 18 months from the date of the
initial application for coverage under the qualifying health
benefit plan.
Sec. 1508.154. REPORTS. A health benefit plan issuer
that participates in the program shall submit reports to the
department in the form and at the time the commissioner
prescribes.
[Sections 1508.155-1508.200 reserved for expansion]
SUBCHAPTER E. RATING OF QUALIFIED HEALTH BENEFIT PLANS
Sec. 1508.201. RATING; PREMIUM PRACTICES IN GENERAL.
(a) A health benefit plan issuer participating in the program
must:
(1) use rating practices for qualifying health
benefit plans that are consistent with the purposes of this
chapter; and
(2) in setting premiums for qualifying health
benefit plans, consider the availability of reimbursement from
the fund.
(b) A health benefit plan issuer participating in the
program shall apply rating factors consistently with respect to
all small employers in a class of business.
(c) Differences in premium rates charged for qualifying
health benefit plans must be reasonable and reflect objective
differences in plan design.
Sec. 1508.202. PREMIUM RATE DEVELOPMENT AND CALCULATION.
(a) Rating factors used to underwrite qualifying health benefit
plans must produce premium rates for identical groups that:
(1) differ only by the amounts attributable to
health benefit plan design; and
(2) do not reflect differences because of the nature
of the groups assumed to select a particular health benefit plan.
(b) A health benefit plan issuer shall treat each
qualifying health benefit plan that is issued or renewed in a
calendar month as having the same rating period.
(c) A health benefit plan issuer may use only age and
gender as case characteristics, as defined by Section
1501.201(2), in setting premium rates for a qualifying health
benefit plan.
(d) The commissioner by rule may establish additional
rating criteria and requirements for qualifying health benefit
plans if the commissioner determines that the criteria and
requirements are necessary to achieve the purposes of this
chapter.
Sec. 1508.203. FILING; APPROVAL. (a) A health benefit
plan issuer shall file with the department, for review and
approval by the commissioner, premium rates to be charged for
qualifying health benefit plans.
(b) If the commissioner limits health benefit plan issuer
participation in the program under Section 1508.101(b), premium
rates proposed to be charged for each qualifying health benefit
plan will be considered as an element in the contract procurement
process required under that section.
[Sections 1508.204-1508.250 reserved for expansion]
SUBCHAPTER F. HEALTHY TEXAS SMALL EMPLOYER PREMIUM
STABILIZATION FUND
Sec. 1508.251. ESTABLISHMENT OF FUND. (a) To the extent
that funds appropriated to the department are available for this
purpose, the commissioner shall establish a fund from which
health benefit plan issuers may receive reimbursement for claims
paid by the health benefit plan issuers for individuals covered
under qualifying group health plans.
(b) The fund established under this section shall be
known as the healthy Texas small employer premium stabilization
fund.
(c) The commissioner shall adopt rules necessary to
implement and administer the fund, including rules that set out
the procedures for operation of the fund and distribution of
money from the fund.
Sec. 1508.252. OPERATION OF FUND; CLAIM ELIGIBILITY.
(a) A health benefit plan issuer is eligible to receive
reimbursement in an amount that is equal to 80 percent of the
dollar amount of claims paid between $5,000 and $75,000 in a
calendar year for an enrollee in a qualifying health benefit
plan.
(b) A health benefit plan issuer is eligible for
reimbursement from the fund only for the calendar year in which
claims are paid.
(c) Once the dollar amount of claims paid on behalf of a
covered individual reaches or exceeds $75,000 in a given calendar
year, a health benefit plan issuer may not receive reimbursement
for any other claims paid on behalf of the individual in that
calendar year.
Sec. 1508.253. REIMBURSEMENT REQUEST SUBMISSION. (a) A
health benefit plan issuer seeking reimbursement from the fund
shall submit a request for reimbursement in the form prescribed
by the commissioner by rule.
(b) A health benefit plan issuer must request
reimbursement from the fund annually, not later than the date
determined by the commissioner, following the end of the calendar
year for which the reimbursement requests are made.
(c) The commissioner may require a health benefit plan
issuer participating in the program to submit claims data in
connection with reimbursement requests as the commissioner
determines to be necessary to ensure appropriate distribution of
reimbursement funds and oversee the operation of the fund. The
commissioner may require that the data be submitted on a per
covered individual, aggregate, or categorical basis.
Sec. 1508.254. FUND AVAILABILITY. (a) The commissioner
shall compute the total claims reimbursement amount for all
health benefit plan issuers participating in the program for the
calendar year for which claims are reported and reimbursement
requested.
(b) If the total amount requested by health benefit plan
issuers participating in the program for reimbursement for a
calendar year exceeds the amount of funds available for
distribution for claims paid during that same calendar year, the
commissioner shall provide for the pro rata distribution of any
available funds. A health benefit plan issuer participating in
the program is eligible to receive a proportional amount of any
available funds that is equal to the proportion of total eligible
claims paid by all participating health benefit plan issuers that
the requesting health benefit plan issuer paid.
(c) If the amount of funds available for distribution for
claims paid by all health benefit plan issuers participating in
the program during a calendar year exceeds the total amount
requested for reimbursement by all participating health benefit
plan issuers during that calendar year, the commissioner shall
carry forward any excess funds and make those excess funds
available for distribution in the next calendar year. Excess
funds carried over under this section are added to the fund in
addition to any other money appropriated for the fund for the
calendar year into which the funds are carried forward.
Sec. 1508.255. PROGRAM REPORTING. (a) Each health
benefit plan issuer participating in the program shall provide
the department, in the form prescribed by the commissioner,
monthly reports of total enrollment under qualifying health
benefit plans.
(b) On the request of the commissioner, each health
benefit plan issuer participating in the program shall furnish to
the department, in the form prescribed by the commissioner, data
other than data described by Subsection (a) that the commissioner
determines necessary to oversee the operation of the fund.
Sec. 1508.256. CLAIMS EXPERIENCE DATA. (a) Based on
available data and appropriate actuarial assumptions, the
commissioner shall separately estimate the per covered
individual annual cost of total claims reimbursement from the
fund for qualifying health benefit plans.
(b) On request, a health benefit plan issuer
participating in the program shall furnish to the department
claims experience data for use in the estimates described by
Subsection (a).
Sec. 1508.257. TOTAL ELIGIBLE ENROLLMENT DETERMINATION.
(a) The commissioner shall determine total eligible enrollment
under qualifying health benefit plans by dividing the total funds
available for distribution from the fund by the estimated per
covered individual annual cost of total claims reimbursement
from the fund.
(b) At the end of the first year of enrollment and
annually thereafter, the commissioner shall submit a report to
the governor and the legislature regarding enrollment for the
previous year and limitations on future enrollment that ensure
that the Healthy Texas Program does not necessitate a substantial
increase in funding to continue the program, as consistent with
Section 1508.001.
Sec. 1508.258. EVALUATION AND PROTECTION OF FUND;
EMPLOYER ENROLLMENT SUSPENSION. (a) The commissioner shall
suspend the enrollment of new employers in qualifying health
benefit plans if the commissioner determines that the total
enrollment reported by all health benefit plan issuers under
qualifying health benefit plans exceeds the total eligible
enrollment determined under Section 1508.257 and is likely to
result in anticipated annual expenditures from the fund in excess
of the total funds available for distribution from the fund.
(b) The commissioner shall provide a health benefit plan
issuer participating in the program with notification of any
enrollment suspension under Subsection (a) as soon as
practicable after:
(1) receipt of all enrollment data; and
(2) determination of the need to suspend
enrollment.
(c) A suspension of issuance of qualifying health benefit
plans to employers under Subsection (a) does not preclude the
addition of new employees of an employer already covered under a
qualifying health benefit plan or new dependents of employees
already covered under a qualifying health benefit plan.
Sec. 1508.259. EMPLOYER ENROLLMENT REACTIVATION. If, at
any point during a suspension of enrollment under Section
1508.258, the commissioner determines that funds are sufficient
to provide for the addition of new enrollments, the commissioner:
(1) may reactivate new enrollments; and
(2) shall notify all participating group health
benefit plan issuers that enrollment of new employers may be
resumed.
Sec. 1508.260. FUND ADMINISTRATOR. (a) The
commissioner may obtain the services of an independent
organization to administer the fund.
(b) The commissioner shall establish guidelines for the
submission of proposals by organizations for the purposes of
administering the fund and may approve, disapprove, or recommend
modification to the proposal of an applicant to administer the
fund.
(c) An organization approved to administer the fund shall
submit reports to the commissioner, in the form and at the times
required by the commissioner, as necessary to facilitate
evaluation and ensure orderly operation of the fund, including an
annual report of the affairs and operations of the fund. The
annual report must also be delivered to the governor, the
lieutenant governor, and the speaker of the house of
representatives.
(d) An organization approved to administer the fund shall
maintain records in the form prescribed by the commissioner and
make those records available for inspection by or at the request
of the commissioner.
(e) The commissioner shall determine the amount of
compensation to be allocated to an approved organization as
payment for fund administration. Compensation is payable only
from the fund.
(f) The commissioner may remove an organization approved
to administer the fund from fund administration. An organization
removed from fund administration under this subsection must
cooperate in the orderly transition of services to another
approved organization or to the commissioner.
Sec. 1508.261. STOP-LOSS INSURANCE; REINSURANCE.
(a) The administrator of the fund, on behalf of and with the
prior approval of the commissioner, may purchase stop-loss
insurance or reinsurance from an insurance company licensed to
write that coverage in this state.
(b) Stop-loss insurance or reinsurance may be purchased
to the extent that the commissioner determines funds are
available for the purchase of that insurance.
Sec. 1508.262. PUBLIC EDUCATION AND OUTREACH. (a) The
commissioner may use an amount of the fund, not to exceed eight
percent of the annual amount of the fund, for purposes of
developing and implementing public education, outreach, and
facilitated enrollment strategies targeted to small employers
who do not provide health insurance.
(b) The commissioner shall solicit and accept
recommendations concerning the development and implementation of
education, outreach, and enrollment strategies under Subsection
(a) from agents licensed under Title 13 to write health benefit
plans in this state.
(c) The commissioner may contract with marketing
organizations to perform or provide assistance with education,
outreach, and enrollment strategies described by Subsection (a).
SECTION 2.02. The commissioner of insurance shall adopt
any rules necessary to implement the change in law made by
Chapter 1508, Insurance Code, as added by this article, not later
than January 4, 2010.
SECTION 2.03. (a) The commissioner of insurance shall
make an initial determination concerning limitation of health
benefit plan issuer participation in the program established
under Chapter 1508, Insurance Code, as added by this article, not
later than January 18, 2010. If the commissioner determines that
limited participation is necessary to achieve the purposes of
Chapter 1508, Insurance Code, as added by this article, the
commissioner shall issue a request for proposal from health
benefit plan issuers to participate in the program not later than
May 1, 2010.
(b) The commissioner of insurance shall ensure that the
Healthy Texas Program is fully operational in a manner that
allows health benefit plan issuers participating in the program
to make the first annual request for reimbursement on January 1,
2011.
SECTION 2.04. This Act does not make an appropriation.
This Act takes effect only if a specific appropriation for the
implementation of the Act is provided in a general appropriations
act of the 81st Legislature.
Explanation: This addition is necessary to authorize the
creation of the Healthy Texas Program to enhance the availability
of health coverage.
_______________________________
President of the Senate
I hereby certify that the
above Resolution was adopted by
the Senate on June 1, 2009.
_______________________________
Secretary of the Senate