87R19313 RDS-F
By: Oliverson, Shaheen, Rogers, et al. H.B. No. 3923
A BILL TO BE ENTITLED
AN ACT
relating to multiple employer welfare arrangements.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter A, Chapter 846, Insurance Code, is
amended by adding Section 846.0035 to read as follows:
Sec. 846.0035. APPLICABILITY OF CERTAIN LAWS TO ASSOCIATION
PROVIDING HEALTH BENEFITS. (a) This section applies only to a
multiple employer welfare arrangement:
(1) that was issued an initial certificate of
authority under Section 846.054 on or after January 1, 2022; or
(2) that elects to be bound by this section in the
manner prescribed by the commissioner.
(b) A multiple employer welfare arrangement that provides a
comprehensive health benefit plan, as determined by the
commissioner, is subject to the following laws as if the
arrangement were an insurer, individuals entitled to coverage under
the plan were insureds, and the health benefits were provided
through an insurance policy:
(1) Chapter 421;
(2) Chapter 422;
(3) Subchapters C, F, and K, Chapter 1451; and
(4) Chapter 4201.
(c) A multiple employer welfare arrangement that provides a
comprehensive health benefit plan, as determined by the
commissioner, that is determined by the commissioner to be
structured in the manner of a preferred provider benefit plan or an
exclusive provider benefit plan as defined in Section 1301.001 is
subject to the following laws as if the arrangement were an insurer,
individuals entitled to coverage under the plan were insureds, and
the health benefits were provided through an insurance policy:
(1) Chapter 1301; and
(2) Chapter 1467.
SECTION 2. Section 846.052(b), Insurance Code, is amended
to read as follows:
(b) The application form must be completed and submitted
along with all information required by the commissioner, including:
(1) a copy of each organizational document;
(2) current financial statements of the arrangement;
(3) a fully detailed statement indicating the plan
under which the arrangement proposes to transact business;
(4) an initial actuarial opinion in compliance with
the requirements of Section 846.153(a)(2) and subject to Section
846.157(b); and
(5) demonstration [a statement] by the applicant
[certifying] that the arrangement is in compliance with all
applicable federal and state laws [provisions of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et
seq.)].
SECTION 3. Section 846.053, Insurance Code, is amended by
amending Subsections (b) and (c) and adding Subsection (d-1) to
read as follows:
(b) The employers in the multiple employer welfare
arrangement must:
(1) be members of an association or group of five or
more businesses that are in the same trade or industry, including
closely related businesses that provide support, services, or
supplies primarily to that trade or industry; or
(2) for a multiple employer welfare arrangement to
which Section 846.0035 applies, each have a principal place of
business in the same region that does not exceed the boundaries of
this state or the boundaries of a metropolitan statistical area
designated by the United States Office of Management and Budget.
(c) If the employers in the multiple employer welfare
arrangement are members of an association, the association must:
(1) be engaged in substantial activity for its
members other than sponsorship of an employee welfare benefit plan;
and
(2) if Section 846.0035 does not apply to the multiple
employer welfare arrangement, have been in existence for at least
two years before engaging in any activities relating to providing
employee health benefits to its members.
(d-1) For purposes of a multiple employer welfare
arrangement to which Section 846.0035 applies, a working owner of a
trade or business without employees may qualify as both an employer
and as an employee of the trade or industry for the purposes of this
section. In this subsection, "working owner" means an individual
who:
(1) has an ownership right of any nature in a trade or
business, whether incorporated or unincorporated, including a
partner and other self-employed individual;
(2) earns wages or self-employment income from the
trade or business for providing personal services to the trade or
business; and
(3) either:
(A) works on average at least 20 hours per week or
at least 80 hours per month providing personal services to the
working owner's trade or business; or
(B) has wages or self-employment income from the
individual's trade or business that at least equals the
individual's cost of coverage for participation by the individual
and any covered beneficiaries in the group health plan sponsored by
the group or association in which the individual is participating.
SECTION 4. This Act takes effect September 1, 2021.