82R394 PMO-D
By: Shelton H.B. No. 3277
A BILL TO BE ENTITLED
AN ACT
relating to creation of portable insurance plans.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle G, Title 8, Insurance Code, is amended
by adding Chapter 1509 to read as follows:
CHAPTER 1509. PORTABLE INSURANCE ACT
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1509.001. DEFINITIONS. In this chapter:
(1) "Portable insurance plan" means a health benefit
plan offered under this chapter that provides coverage for benefits
selected by an enrollee.
(2) "Enrollee" means an individual who has been
determined to be eligible for and is receiving plan coverage under
this chapter.
(3) "Plan coverage" means health care services that
are covered as benefits under a portable insurance plan.
(4) "Plan entity" means a health insurer or health
maintenance organization that offers a portable insurance plan.
(5) "Telehealth service" means a health service, other
than a telemedicine medical service, that is delivered by a
licensed or certified health professional acting within the scope
of the health professional's license or certification who does not
perform a telemedicine medical service and that requires the use of
advanced telecommunications technology, including:
(A) compressed digital interactive video, audio,
or data transmission;
(B) clinical data transmission using computer
imaging by way of still-image capture and store and forward; and
(C) other technology that facilitates access to
health care services or medical specialty expertise.
(6) "Telemedicine medical service" means a health care
service provided by a health professional acting under physician
delegation and supervision, for purposes of patient assessment by
the health professional, diagnosis or consultation by a physician,
treatment, or the transfer of medical data, that requires the use of
advanced telecommunications technology, including:
(A) compressed digital interactive video, audio,
or data transmission;
(B) clinical data transmission using computer
imaging by way of still-image capture and store and forward; and
(C) other technology that facilitates access to
health care services or medical specialty expertise.
Sec. 1509.002. PARTICIPATION IN EXCHANGE; QUALIFIED HEALTH
PLAN; WAIVER. (a) If an exchange is established in this state as
the American Health Benefit Exchange required by Section 1311,
Patient Protection and Affordable Care Act (Pub. L. No. 111-148), a
portable insurance plan shall be deemed a qualified health plan for
purposes of the exchange.
(b) If the commissioner determines that a waiver of federal
law or other federal authorization is required so that a portable
insurance plan may be treated as a qualified health plan under
Subsection (a), the commissioner shall request the waiver or
authorization and may delay implementing Subsection (a) until the
waiver or authorization is granted.
(c) If the commissioner determines that a waiver of federal
law or other federal authorization would facilitate implementation
of this chapter, the commissioner may request the waiver or
authorization.
Sec. 1509.003. RULES. The commissioner may adopt rules as
necessary to implement this chapter.
[Sections 1509.004-1509.050 reserved for expansion]
SUBCHAPTER B. PARTICIPATION; COVERAGE AND BENEFITS
Sec. 1509.051. PLAN ENTITIES. (a) Subject to Subsection
(b), any plan entity may issue plan coverage under this chapter.
(b) The commissioner by rule may limit which plan entity may
issue a plan under this chapter if the commissioner determines that
the limitation is necessary to ensure that:
(1) plan coverage is available and affordable for
residents of this state; and
(2) plan entities are financially sound.
(c) If the commissioner limits participation under
Subsection (b), the commissioner shall contract on a competitive
procurement basis with one or more plan entities to provide plan
coverage under this chapter.
Sec. 1509.052. EXCLUSION OR LIMITATION OF COVERAGE FOR
PREEXISTING DISEASE OR CONDITION. (a) A portable insurance plan
may exclude or limit coverage for a preexisting disease or
condition for not more than the 180 days immediately after the
effective date of coverage.
(b) A plan entity that excludes or limits coverage for a
preexisting disease or condition as described by Subsection (a)
shall issue to the applicant a notice of uninsured preexisting
condition that:
(1) certifies that the plan entity refused to issue
coverage to the applicant for health reasons; and
(2) states each disease or condition the plan entity
refused to cover.
(c) An applicant who receives a notice of uninsured
preexisting condition under Subsection (b) may apply for coverage
under Section 1506.161.
Sec. 1509.053. EXCEPTION FROM MANDATED BENEFIT
REQUIREMENTS. A portable insurance plan is not subject to a law
that requires coverage or the offer of coverage of a health care
service or benefit.
Sec. 1509.054. CERTAIN COVERAGE AUTHORIZED. (a) A
portable insurance plan may provide coverage for services and
benefits such as:
(1) preventive health services, which may include
immunizations, annual health assessments, well-woman and well-care
services, mammograms, cervical cancer screenings, and noninvasive
colorectal or prostate screenings;
(2) incentives for routine preventive care;
(3) office visits for the diagnosis and treatment of
illness or injury;
(4) office surgery, including anesthesia;
(5) behavioral health services;
(6) durable medical equipment and prosthetics;
(7) diabetic supplies;
(8) inpatient hospital stays;
(9) hospital emergency care services;
(10) urgent care services; and
(11) outpatient facility services, outpatient
surgery, and outpatient diagnostic services.
(b) A portable insurance plan may offer prescription drug
coverage that complies with Chapter 1369.
(c) The commissioner may, with respect to the categories of
services and benefits described by this section:
(1) suggest coverage that may be offered under this
chapter;
(2) advise the plan entity regarding methods and
procedures of claims administration;
(3) facilitate the resolution of coverage disputes
arising from a portable insurance plan;
(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) design, implement, and monitor portable insurance
plan features intended to discourage excessive utilization,
promote efficiency, and contain costs for plans;
(6) develop and refine, on an ongoing basis, a health
benefit strategy under this chapter that is consistent with
evolving benefits delivery systems;
(7) develop a program to encourage employer
contributions to ensure that plan coverage is available and
affordable for residents of this state; and
(8) modify the copayment and deductible amounts for
prescription drug benefits under a portable insurance plan, if the
commissioner determines that the modification is necessary to
ensure that plan coverage is available and affordable for residents
of this state.
Sec. 1509.055. LIMITED GUARANTEED ISSUE; MINIMUM TERM. (a)
A plan entity shall issue plan coverage to an individual who:
(1) applies for plan coverage;
(2) agrees to satisfy the requirements of the portable
insurance plan selected by the applicant; and
(3) has been a member of a federal or state high risk
health pool for at least six months immediately before the date of
the application for coverage under this chapter.
(b) A plan must provide coverage under this chapter for a
term of not less than three years.
Sec. 1509.056. TELEHEALTH AND TELEMEDICINE MEDICAL
COVERAGE REQUIRED. (a) A portable insurance plan must cover
telemedicine medical services or telehealth services under the plan
in accordance with Chapter 1455.
(b) To promote efficiencies in the delivery of health care
services, telehealth service and telemedicine medical service,
including consultation between a health care provider and an
enrollee by phone or e-mail or other electronic media, must be
promoted and covered under a portable insurance plan.
Sec. 1509.057. PORTABILITY; NONDISCRIMINATORY
CONTRIBUTION. (a) A portable insurance plan is individual health
coverage, not sponsored by any employer or group and not dependent
on an enrollee's employment status or membership in a group.
(b) Notwithstanding Subsection (a), an employer or group
may contribute to the payment of premiums for a portable insurance
plan through wage adjustment, reimbursement, or otherwise.
(c) An employer or group making a contribution under
Subsection (b) may not classify, differentiate, or discriminate
against payment of premium based on the coverage selected by the
enrollee.
Sec. 1509.058. COST CONTAINMENT. A plan entity must
discourage excessive utilization, promote efficiency, and contain
costs of a portable insurance plan.
[Sections 1509.059-1509.100 reserved for expansion]
SUBCHAPTER C. PORTABLE INSURANCE PLAN ADMINISTRATION
Sec. 1509.101. APPLICATION PROCESS. A plan entity shall
accept applications for plan coverage at all times throughout the
calendar year.
Sec. 1509.102. ENROLLMENT MATERIALS. Plan enrollment
materials must include:
(1) information in plain language about benefits
provided under plan coverage, benefit limits, cost-sharing
provisions, and exclusions;
(2) a clear representation of what is not covered by a
benefit offered; and
(3) a standard disclosure form adopted by the
commissioner by rule that an applicant for plan coverage must read
and execute.
Sec. 1509.103. GUIDELINES. The commissioner shall adopt by
rule guidelines to:
(1) ensure that portable insurance plans meet
standards for quality of care and access to care that are consistent
with prevailing professionally recognized standards of practice;
and
(2) encourage implementation of this chapter in a
manner that provides federal tax benefits to enrollees, plan
entities, and employers or groups described by Section 1509.057.
Sec. 1509.104. REGULATORY OVERSIGHT. A change in a
portable insurance plan benefit, premium, or policy form is subject
to regulatory oversight by the department as provided by rule
adopted by the commissioner.
Sec. 1509.105. PUBLIC AWARENESS. (a) The department shall
develop a public awareness program to be implemented throughout the
state to promote portable insurance plans.
(b) A public or private entity may implement a program to
encourage enrollment in the portable insurance plans, to encourage
employers and groups to contribute to the payment of portable
insurance plan premiums for enrollees, and to advise individuals,
employers, and other entities about the anticipated tax
consequences of a contribution to the payment of an enrollee's
premiums.
Sec. 1509.106. REPORTS. A plan entity shall submit reports
to the department in the form and at the time the commissioner
prescribes.
[Sections 1509.107-1509.150 reserved for expansion]
SUBCHAPTER D. REGULATION OF PORTABLE INSURANCE PLANS
Sec. 1509.151. RATING; PREMIUM PRACTICES IN GENERAL. (a) A
plan entity must use rating practices for portable insurance plans
that are consistent with the purposes of this chapter.
(b) A plan entity shall apply rating factors consistently
with respect to all enrollees.
(c) A difference in premium rates charged by a plan entity
for portable insurance plans must be reasonable and reflect an
objective difference in plan design.
Sec. 1509.152. PREMIUM RATE DEVELOPMENT AND CALCULATION.
(a) Rating factors used to underwrite portable insurance plans
must produce premium rates that:
(1) differ only by the amounts attributable to plan
design; and
(2) do not reflect differences because of the nature
of the individuals assumed to select a particular portable
insurance plan.
(b) Each portable insurance plan that is issued or renewed
by a plan entity in a calendar month must be issued subject to the
same premium rates.
(c) The commissioner by rule may establish additional
rating criteria and requirements for portable insurance plans if
the commissioner determines that the criteria and requirements are
necessary to ensure that plan coverage is available and affordable
for residents of this state and plan entities are financially
sound.
Sec. 1509.153. PLAN DISAPPROVAL. (a) The department shall
disapprove a portable insurance plan that:
(1) contains an ambiguous, inconsistent, or
misleading provision or an exception or condition that deceptively
affects or limits the benefits purported to be assumed in the
general coverage provided by the plan; or
(2) provides benefits that are unreasonable in
relation to the premium charged or contains provisions that are
unfair or inequitable, that are contrary to the public policy of
this state, that encourage misrepresentation, or that result in
unfair discrimination in sales practices.
(b) The department shall disapprove a portable insurance
plan if the plan entity:
(1) cannot demonstrate that the plan is financially
sound; or
(2) is not in compliance with the standards required
under this code.
Sec. 1509.154. GUARANTY ASSOCIATION. Portable insurance
plans are not covered by the Texas Life, Accident, Health and
Hospital Service Insurance Guaranty Association.
Sec. 1509.155. RECORDS. Each portable insurance plan must
maintain enrollment data and reasonable records to enable the
department to monitor the plan and determine the financial
viability of the plan.
Sec. 1509.156. PROGRAM EVALUATION. The department shall
issue a biennial report to the legislature that:
(1) evaluates portable insurance plans and their
effect on plan entities, the number of enrollees, and the scope of
the health care coverage offered under a portable insurance plan;
(2) provides an assessment of portable insurance plans
and their potential applicability in other settings; and
(3) uses portable insurance plans to gather
information to evaluate low-income, consumer-driven benefit
packages.
SECTION 2. Section 1506.151(a), Insurance Code, is amended
to read as follows:
(a) Except as provided by Section 1506.161, the [The] pool
shall offer coverage consistent with major medical expense coverage
to each eligible individual.
SECTION 3. Sections 1506.152(a) and (c), Insurance Code,
are amended to read as follows:
(a) An individual who is a legally domiciled resident of
this state is eligible for coverage from the pool if the individual:
(1) provides to the pool evidence that the individual
is a federally defined eligible individual who has not experienced
a significant break in coverage;
(2) is younger than 65 years of age and provides to the
pool evidence that the individual maintained health benefit plan
coverage under another state's qualified Health Insurance
Portability and Accountability Act health program that was
terminated because the individual did not reside in that state and
submits an application for pool coverage not later than the 63rd day
after the date the coverage described by this subdivision was
terminated;
(3) is younger than 65 years of age and has been a
legally domiciled resident of this state for the preceding 30 days,
is a citizen of the United States or has been a permanent resident
of the United States for at least three continuous years, and
provides to the pool:
(A) a notice of rejection of, or refusal to
issue, substantially similar individual health benefit plan
coverage from a health benefit plan issuer, other than an insurer
that offers only stop-loss, excess loss, or reinsurance coverage,
if the rejection or refusal was for health reasons;
(B) certification from an agent or salaried
representative of a health benefit plan issuer that states that the
agent or salaried representative cannot obtain substantially
similar individual coverage for the individual from any health
benefit plan issuer that the agent or salaried representative
represents because, under the underwriting guidelines of the health
benefit plan issuer, the individual will be denied coverage as a
result of a medical condition of the individual;
(C) an offer to issue substantially similar
individual coverage only with conditional riders;
(D) a diagnosis of the individual with one of the
medical or health conditions on the list adopted under Section
1506.154; or
(E) evidence that the individual is covered by
substantially similar individual coverage that excludes one or more
conditions by rider; [or]
(4) provides to the pool evidence that, on the date of
application to the pool, the individual is certified as eligible
for trade adjustment assistance or for pension benefit guaranty
corporation assistance, as provided by the Trade Adjustment
Assistance Reform Act of 2002 (Pub. L. No. 107-210); or
(5) applies for coverage under Section 1506.161 and
provides to the pool a notice of uninsured preexisting condition
issued by a portable insurance plan entity under Chapter 1509.
(c) Subject to Subsection (f), if an individual who obtains
coverage from the pool under Subsection (a), other than coverage
under Subsection (a)(5), is a child, each parent, grandparent,
brother, sister, or child of that individual who resides with that
individual is also eligible for coverage from the pool.
SECTION 4. Section 1506.153, Insurance Code, is amended by
adding Subsection (e) to read as follows:
(e) Nothing in this section shall be construed to prevent an
enrollee under Chapter 1509 from obtaining coverage under Section
1506.161.
SECTION 5. Section 1506.155, Insurance Code, is amended by
adding Subsection (e) to read as follows:
(e) Nothing in this section shall be construed to prevent an
enrollee under Chapter 1509 from obtaining coverage under Section
1506.161.
SECTION 6. Section 1506.156, Insurance Code, is amended by
adding Subsection (c) to read as follows:
(c) Nothing in this section allows the pool to reduce
benefits paid under Section 1506.161 by an amount paid or payable
through a portable insurance plan under Chapter 1509.
SECTION 7. Subchapter D, Chapter 1506, Insurance Code, is
amended by adding Section 1506.161 to read as follows:
Sec. 1506.161. PREEXISTING CONDITION COVERAGE FOR PORTABLE
INSURANCE PLAN ENROLLEES. (a) An individual who is an enrollee of
a portable insurance plan under Chapter 1509 is entitled to
coverage from the pool under this section if the individual
provides to the pool a notice of uninsured preexisting condition
issued under Section 1509.052.
(b) The pool shall and may only cover each uninsured
preexisting condition for which an individual provides a notice
issued under Section 1509.052.
(c) Coverage under this section must be consistent with
major medical expense coverage.
(d) An individual's coverage under this section expires on
the date the exclusion or limitation period described by Section
1509.052 and applicable to the individual's coverage under Chapter
1509 expires.
SECTION 8. Section 1506.301, Insurance Code, is amended to
read as follows:
Sec. 1506.301. SUBROGATION TO RIGHTS AGAINST THIRD PARTY.
(a) The pool:
(1) is subrogated to the rights of an individual
covered by the pool to recover against a third party costs for an
injury or illness for which the third party is liable under
contract, tort law, or other law that have been paid by the pool on
behalf of the covered individual; and
(2) may enforce that liability on behalf of the
individual.
(b) Notwithstanding Subsection (a), the pool has no
subrogation rights against a portable insurance plan entity arising
out of a payment that the pool makes under Section 1506.161.
SECTION 9. Section 1369.002, Insurance Code, is amended to
read as follows:
Sec. 1369.002. APPLICABILITY OF SUBCHAPTER. This
subchapter applies only to a health benefit plan that provides
benefits for medical or surgical expenses incurred as a result of a
health condition, accident, or sickness, including an individual,
group, blanket, or franchise insurance policy or insurance
agreement, a group hospital service contract, or an individual or
group evidence of coverage or similar coverage document that is
offered by:
(1) an insurance company;
(2) a group hospital service corporation operating
under Chapter 842;
(3) a fraternal benefit society operating under
Chapter 885;
(4) a stipulated premium company operating under
Chapter 884;
(5) a reciprocal exchange operating under Chapter 942;
(6) a health maintenance organization operating under
Chapter 843;
(7) a multiple employer welfare arrangement that holds
a certificate of authority under Chapter 846; [or]
(8) an approved nonprofit health corporation that
holds a certificate of authority under Chapter 844; or
(9) a portable insurance plan entity under Chapter
1509.
SECTION 10. The commissioner of insurance shall adopt any
rules necessary to implement the change in law made by Chapter 1509,
Insurance Code, as added by this Act, not later than January 1,
2012.
SECTION 11. The commissioner of insurance shall make an
initial determination concerning limitation of plan entity
participation under Chapter 1509, Insurance Code, as added by this
Act, not later than January 15, 2012. If the commissioner
determines that limited participation is necessary, the
commissioner shall issue a request for proposal from health
insurers and health maintenance organizations to participate under
Chapter 1509, Insurance Code, as added by this Act, not later than
May 1, 2012.
SECTION 12. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2011.