Texas 2021 - 87th Regular

Texas Senate Bill SB120 Compare Versions

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Old	New	Differences
1	1	87R1805 SMT-F
2	2	By: Johnson S.B. No. 120
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the creation of a health insurance risk pool for certain
8	8	health benefit plan enrollees; authorizing an assessment.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Subtitle G, Title 8, Insurance Code, is amended
11	11	by adding Chapter 1511 to read as follows:
12	12	CHAPTER 1511. HEALTH INSURANCE RISK POOL
13	13	SUBCHAPTER A. GENERAL PROVISIONS
14	14	Sec. 1511.0001. DEFINITIONS. In this chapter:
15	15	(1) "Board" means the board of directors appointed
16	16	under this chapter.
17	17	(2) "Pool" means a health insurance risk pool
18	18	established under this chapter and administered by the board.
19	19	Sec. 1511.0002. WAIVER. The commissioner may:
20	20	(1) apply to the United States secretary of health and
21	21	human services under 42 U.S.C. Section 18052 for a waiver of
22	22	applicable provisions of the Patient Protection and Affordable Care
23	23	Act (Pub. L. No. 111-148) and any applicable regulations or
24	24	guidance;
25	25	(2) take any action the commissioner considers
26	26	appropriate to make an application under Subdivision (1); and
27	27	(3) implement a state plan that meets the requirements
28	28	of a waiver granted in response to an application under Subdivision
29	29	(1) if the plan is:
30	30	(A) consistent with state and federal law; and
31	31	(B) approved by the United States secretary of
32	32	health and human services.
33	33	Sec. 1511.0003. EXEMPTION FROM STATE TAXES AND FEES.
34	34	Notwithstanding any other law, a program created under this chapter
35	35	is not subject to any state tax, regulatory fee, or surcharge,
36	36	including a premium or maintenance tax or fee.
37	37	SUBCHAPTER B. ESTABLISHMENT AND PURPOSE
38	38	Sec. 1511.0051. ESTABLISHMENT OF HEALTH INSURANCE RISK
39	39	POOL. To the extent that federal funds are available, the
40	40	commissioner may:
41	41	(1) apply for the federal funds;
42	42	(2) use the federal funds to establish a pool for the
43	43	purpose of this chapter; and
44	44	(3) authorize the board to use the federal funds to
45	45	administer a pool for the purpose of this chapter.
46	46	Sec. 1511.0052. PURPOSE OF POOL. (a) The purpose of the
47	47	pool is to provide a mechanism to meaningfully reduce health
48	48	benefit plan premiums in the individual health benefit plan market
49	49	by maximizing available federal funds to assist residents of this
50	50	state to obtain guaranteed issue health benefit coverage.
51	51	(b) The pool may not be used to expand the Medicaid program,
52	52	including the program administered under Chapter 32, Human
53	53	Resources Code, and the program administered under Chapter 533,
54	54	Government Code.
55	55	SUBCHAPTER C. ADMINISTRATION
56	56	Sec. 1511.0101. BOARD OF DIRECTORS. The pool is governed by
57	57	a nine-member board of directors appointed by the commissioner.
58	58	Sec. 1511.0102. PRESIDING OFFICER. The commissioner shall
59	59	designate one board member to serve as presiding officer at the
60	60	pleasure of the commissioner.
61	61	Sec. 1511.0103. TERMS. Board members serve staggered
62	62	six-year terms.
63	63	Sec. 1511.0104. PER DIEM; REIMBURSEMENT. A board member is
64	64	not entitled to compensation for service on the board but is
65	65	entitled to:
66	66	(1) a per diem in the amount provided by the General
67	67	Appropriations Act for state officials for each day the member
68	68	performs duties as a board member; and
69	69	(2) reimbursement of expenses incurred while
70	70	performing duties as a board member in the amount provided by the
71	71	General Appropriations Act for state officials.
72	72	Sec. 1511.0105. MEMBER'S IMMUNITY. (a) A board member is
73	73	not liable for an act or omission made in good faith in the
74	74	performance of powers and duties under this chapter.
75	75	(b) A cause of action does not arise against a board member
76	76	for an act or omission described by Subsection (a).
77	77	Sec. 1511.0106. ADDITIONAL POWERS AND DUTIES. The
78	78	commissioner by rule may establish powers and duties of the board in
79	79	addition to those provided by this chapter.
80	80	Sec. 1511.0107. PLAN OF OPERATION. (a) Operation and
81	81	management of the pool are governed by a plan of operation adopted
82	82	by the board and approved by the commissioner. The plan of
83	83	operation includes the articles, bylaws, and operating rules of the
84	84	pool that are adopted by the board.
85	85	(b) The plan of operation must ensure the fair, reasonable,
86	86	and equitable administration of the pool.
87	87	(c) The board shall amend the plan of operation as necessary
88	88	to carry out this chapter. An amendment to the plan of operation
89	89	must be approved by the commissioner before the board may adopt the
90	90	amendment.
91	91	SUBCHAPTER D. POWERS AND DUTIES
92	92	Sec. 1511.0151. METHODS TO REDUCE PREMIUM IN INDIVIDUAL
93	93	MARKET. Subject to any requirements to obtain federal funds for the
94	94	pool, the board may use money from the pool to achieve lower
95	95	enrollee premium rates by providing to health benefit plan issuers
96	96	writing guaranteed issue coverage in the individual market:
97	97	(1) a reinsurance program; or
98	98	(2) direct funding if the health benefit plan issuer's
99	99	plan provides coverage for individuals described by Section
100	100	1511.0152.
101	101	Sec. 1511.0152. ACCESS TO GUARANTEED ISSUE COVERAGE. The
102	102	board shall use pool funds to enhance enrollment in guaranteed
103	103	issue coverage in the individual market in a manner that ensures
104	104	that the benefits and cost-sharing protections available in the
105	105	individual market are maintained in the same manner the benefits
106	106	and protections would be maintained without the waiver described by
107	107	Section 1511.0002.
108	108	Sec. 1511.0153. CONTRACTS AND AGREEMENTS. The board may
109	109	enter into a contract or agreement that the board determines is
110	110	appropriate to carry out this chapter, including a contract or
111	111	agreement with:
112	112	(1) a similar pool in another state for the joint
113	113	performance of common administrative functions;
114	114	(2) another organization for the performance of
115	115	administrative functions; or
116	116	(3) a federal agency.
117	117	Sec. 1511.0154. RULES. The commissioner and board may
118	118	adopt rules necessary to implement this chapter, including rules to
119	119	administer the pool and distribute money from the pool.
120	120	Sec. 1511.0155. PROCEDURES, CRITERIA, AND FORMS. The board
121	121	by rule shall provide the procedures, criteria, and forms necessary
122	122	to implement, collect, and deposit assessments under Subchapter E.
123	123	Sec. 1511.0156. PUBLIC EDUCATION AND OUTREACH. (a) The
124	124	commissioner may allocate to the board funds appropriated to the
125	125	department for the exclusive purposes of this chapter to develop
126	126	and implement public education, outreach, and facilitated
127	127	enrollment strategies under this chapter.
128	128	(b) The board may contract with marketing organizations to
129	129	perform or provide assistance with the strategies described by
130	130	Subsection (a).
131	131	Sec. 1511.0157. AUTHORITY TO ACT AS REINSURER. In addition
132	132	to the powers granted to the board under this chapter, the board may
133	133	exercise any authority that may be exercised under the law of this
134	134	state by a reinsurer.
135	135	SUBCHAPTER E. FUNDING
136	136	Sec. 1511.0201. FUNDING. (a) The commissioner may use
137	137	funds appropriated to the department to:
138	138	(1) apply for federal funds and grants; and
139	139	(2) implement this chapter.
140	140	(b) Notwithstanding Section 6(e)(2)(B), Chapter 615 (S.B.
141	141	1367), Acts of the 83rd Legislature, Regular Session, 2013, the
142	142	commissioner may use money appropriated to the department from the
143	143	healthy Texas small employer premium stabilization fund for the
144	144	exclusive purposes of this chapter, other than for paying salaries
145	145	and salary-related benefits.
146	146	(c) Notwithstanding Section 6(e)(2)(B), Chapter 615 (S.B.
147	147	1367), Acts of the 83rd Legislature, Regular Session, 2013, the
148	148	commissioner shall transfer money from the healthy Texas small
149	149	employer premium stabilization fund to the Texas Department of
150	150	Insurance operating account in an amount equal to the amount of
151	151	money appropriated to the department from that fund, as described
152	152	by Subsection (b), for the direct and indirect costs of the
153	153	exclusive purposes of this chapter.
154	154	(d) Except as provided by this section, the commissioner may
155	155	not use any state funds to fund the pool unless the funds are
156	156	specifically appropriated for that purpose.
157	157	Sec. 1511.0202. ASSESSMENTS. (a) The board may assess
158	158	health benefit plan issuers, including making advance interim
159	159	assessments, as reasonable and necessary for the pool's
160	160	organizational and interim operating expenses.
161	161	(b) The board shall credit an interim assessment as an
162	162	offset against any regular assessment that is due after the end of
163	163	the fiscal year.
164	164	(c) The regular assessment is the amount determined by the
165	165	board under Section 1511.0203 and recovered from health benefit
166	166	plan issuers under Section 1511.0204.
167	167	(d) The board shall deposit money from the interim and
168	168	regular assessments described by this section in an account
169	169	established outside the treasury, held by the comptroller, and
170	170	administered by the commissioner. Money in the account may be spent
171	171	without an appropriation and may be used only for purposes
172	172	authorized by this chapter.
173	173	Sec. 1511.0203. DETERMINATION OF POOL FUNDING
174	174	REQUIREMENTS. (a) For the first year of operation of the pool, the
175	175	board shall determine the amount of money required by the pool to
176	176	reduce the amount of premiums an enrollee would otherwise pay in
177	177	that year by 15 percent in accordance with this chapter after
178	178	applying the federal funds obtained under this chapter and funding
179	179	authorized by Section 1511.0201.
180	180	(b) After the end of each fiscal year, the board shall
181	181	determine for the next calendar year the amount of money required by
182	182	the pool to maintain a 15 percent reduction in the amount of
183	183	premiums an enrollee would otherwise pay in that year in accordance
184	184	with this chapter after applying the federal funds obtained under
185	185	this chapter and funding authorized by Section 1511.0201.
186	186	Sec. 1511.0204. ASSESSMENTS TO COVER POOL FUNDING
187	187	REQUIREMENTS. (a) The board shall recover an amount equal to the
188	188	funding required as estimated under Section 1511.0203 by assessing
189	189	each health benefit plan issuer an amount determined annually by
190	190	the board based on information in annual statements, the health
191	191	benefit plan issuer's annual report to the board under Sections
192	192	1511.0251 and 1511.0252, and any other reports required by and
193	193	filed with the board.
194	194	(b) The board shall use the total number of enrolled
195	195	individuals reported by all health benefit plan issuers under
196	196	Section 1511.0252 as of the preceding December 31 to compute the
197	197	amount of a health benefit plan issuer's assessment, if any, in
198	198	accordance with this subsection. The board shall allocate the
199	199	total amount to be assessed based on the total number of enrolled
200	200	individuals covered by excess loss, stop-loss, or reinsurance
201	201	policies and on the total number of other enrolled individuals as
202	202	determined under Section 1511.0252. To compute the amount of a
203	203	health benefit plan issuer's assessment:
204	204	(1) for the issuer's enrolled individuals covered by
205	205	an excess loss, stop-loss, or reinsurance policy, the board shall:
206	206	(A) divide the allocated amount to be assessed by
207	207	the total number of enrolled individuals covered by excess loss,
208	208	stop-loss, or reinsurance policies, as determined under Section
209	209	1511.0252, to determine the per capita amount; and
210	210	(B) multiply the number of a health benefit plan
211	211	issuer's enrolled individuals covered by an excess loss, stop-loss,
212	212	or reinsurance policy, as determined under Section 1511.0252, by
213	213	the per capita amount to determine the amount assessed to that
214	214	health benefit plan issuer; and
215	215	(2) for the issuer's enrolled individuals not covered
216	216	by excess loss, stop-loss, or reinsurance policies, the board,
217	217	using the gross health benefit plan premiums reported for the
218	218	preceding calendar year by health benefit plan issuers under
219	219	Section 1511.0253, shall:
220	220	(A) divide the gross premium collected by a
221	221	health benefit plan issuer by the gross premium collected by all
222	222	health benefit plan issuers; and
223	223	(B) multiply the allocated amount to be assessed
224	224	by the fraction computed under Paragraph (A) to determine the
225	225	amount assessed to that health benefit plan issuer.
226	226	(c) A small employer health benefit plan subject to Chapter
227	227	1501 is not subject to an assessment under this section.
228	228	Sec. 1511.0205. ASSESSMENT DUE DATE; INTEREST. (a) An
229	229	assessment is due on the date specified by the board that is not
230	230	earlier than the 30th day after the date written notice of the
231	231	assessment is transmitted to the health benefit plan issuer.
232	232	(b) Interest accrues on the unpaid amount of an assessment
233	233	at a rate equal to the prime lending rate, as published in the most
234	234	recent issue of the Wall Street Journal and determined as of the
235	235	first day of each month during which the assessment is delinquent,
236	236	plus three percent.
237	237	Sec. 1511.0206. ABATEMENT OR DEFERMENT OF ASSESSMENT. (a)
238	238	A health benefit plan issuer may petition the board for an abatement
239	239	or deferment of all or part of an assessment imposed by the board.
240	240	The board may abate or defer all or part of the assessment if the
241	241	board determines that payment of the assessment would endanger the
242	242	ability of the health benefit plan issuer to fulfill its
243	243	contractual obligations.
244	244	(b) If all or part of an assessment against a health benefit
245	245	plan issuer is abated or deferred, the amount of the abatement or
246	246	deferment shall be assessed against the other health benefit plan
247	247	issuers in a manner consistent with the method for computing
248	248	assessments under this chapter.
249	249	(c) A health benefit plan issuer receiving an abatement or
250	250	deferment under this section remains liable to the pool for the
251	251	deficiency.
252	252	Sec. 1511.0207. USE OF EXCESS FROM ASSESSMENTS. If the
253	253	total amount of the assessments exceeds the pool's actual losses
254	254	and administrative expenses, the board shall credit each health
255	255	benefit plan issuer with the excess in an amount proportionate to
256	256	the amount the health benefit plan issuer paid in assessments. The
257	257	credit may be paid to the health benefit plan issuer or applied to
258	258	future assessments under this chapter.
259	259	Sec. 1511.0208. COLLECTION OF ASSESSMENTS. The pool may
260	260	recover or collect assessments made under this subchapter.
261	261	SUBCHAPTER F. REPORTING
262	262	Sec. 1511.0251. ANNUAL ISSUER REPORT TO BOARD: REQUESTED
263	263	INFORMATION. Each health benefit plan issuer shall report to the
264	264	board the information requested by the board, as of December 31 of
265	265	the preceding year.
266	266	Sec. 1511.0252. ANNUAL ISSUER REPORT TO BOARD: ENROLLED
267	267	INDIVIDUALS. (a) Each health benefit plan issuer shall report to
268	268	the board the number of residents of this state enrolled, as of
269	269	December 31 of the preceding year, in the issuer's health benefit
270	270	plans providing coverage for residents in this state, as:
271	271	(1) an employee under a group health benefit plan; or
272	272	(2) an individual policyholder or subscriber.
273	273	(b) In determining the number of individuals to report under
274	274	Subsection (a)(1), the health benefit plan issuer shall include
275	275	each employee for whom a premium is paid and coverage is provided
276	276	under an excess loss, stop-loss, or reinsurance policy issued by
277	277	the issuer to an employer or group health benefit plan providing
278	278	coverage for employees in this state. A health benefit plan issuer
279	279	providing excess loss insurance, stop-loss insurance, or
280	280	reinsurance, as described by this subsection, for a primary health
281	281	benefit plan issuer may not report individuals reported by the
282	282	primary health benefit plan issuer.
283	283	(c) Ten employees covered by a health benefit plan issuer
284	284	under a policy of excess loss insurance, stop-loss insurance, or
285	285	reinsurance count as one employee for purposes of determining that
286	286	health benefit plan issuer's assessment.
287	287	(d) In determining the number of individuals to report under
288	288	this section, the health benefit plan issuer shall exclude:
289	289	(1) the dependents of the employee or an individual
290	290	policyholder or subscriber; and
291	291	(2) individuals who are covered by the health benefit
292	292	plan issuer under a Medicare supplement benefit plan subject to
293	293	Chapter 1652.
294	294	(e) In determining the number of enrolled individuals to
295	295	report under this section, the health benefit plan issuer shall
296	296	exclude individuals who are retired employees 65 years of age or
297	297	older.
298	298	Sec. 1511.0253. ANNUAL ISSUER REPORT TO BOARD: GROSS
299	299	PREMIUMS. (a) Each health benefit plan issuer shall report to the
300	300	board the gross premiums collected for the preceding calendar year
301	301	for health benefit plans.
302	302	(b) For purposes of this section, gross health benefit plan
303	303	premiums do not include premiums collected for:
304	304	(1) coverage under a Medicare supplement benefit plan
305	305	subject to Chapter 1652;
306	306	(2) coverage under a small employer health benefit
307	307	plan subject to Chapter 1501;
308	308	(3) coverage:
309	309	(A) for wages or payments in lieu of wages for a
310	310	period during which an employee is absent from work because of
311	311	accident or disability;
312	312	(B) as a supplement to a liability insurance
313	313	policy;
314	314	(C) for credit insurance;
315	315	(D) only for dental or vision care;
316	316	(E) only for a specified disease or illness;
317	317	(F) only for indemnity for hospital confinement;
318	318	(G) only for accident; or
319	319	(H) only for fixed indemnity;
320	320	(4) a workers' compensation insurance policy;
321	321	(5) medical payment insurance coverage provided under
322	322	a motor vehicle insurance policy;
323	323	(6) a long-term care policy, including a nursing home
324	324	fixed indemnity policy, unless the commissioner determines that the
325	325	policy provides comprehensive health benefit plan coverage;
326	326	(7) liability insurance coverage, including general
327	327	liability insurance and automobile liability insurance;
328	328	(8) coverage for on-site medical clinics;
329	329	(9) insurance coverage under which benefits are
330	330	payable with or without regard to fault and that is statutorily
331	331	required to be contained in a liability insurance policy or
332	332	equivalent self-insurance; or
333	333	(10) other similar insurance coverage, as specified by
334	334	federal regulations issued under the Health Insurance Portability
335	335	and Accountability Act of 1996 (Pub. L. No. 104-191), under which
336	336	benefits for medical care are secondary or incidental to other
337	337	insurance benefits.
338	338	Sec. 1511.0254. ANNUAL BOARD REPORT OF POOL ACTIVITIES.
339	339	(a) Beginning June 1, 2022, not later than June 1 of each year, the
340	340	board shall submit a report to the governor, lieutenant governor,
341	341	and speaker of the house of representatives.
342	342	(b) The report submitted under Subsection (a) must
343	343	summarize the activities conducted under this chapter in the
344	344	calendar year preceding the year in which the report is submitted.
345	345	SECTION 2. Notwithstanding Section 6(d)(2), Chapter 615
346	346	(S.B. 1367), Acts of the 83rd Legislature, Regular Session, 2013,
347	347	on the effective date of this Act, the commissioner of insurance
348	348	shall transfer any money remaining outside the state treasury in
349	349	the Texas Treasury Safekeeping Trust Company account established
350	350	under Section 6(c), Chapter 615 (S.B. 1367), Acts of the 83rd
351	351	Legislature, Regular Session, 2013, to the health insurance risk
352	352	pool established by Chapter 1511, Insurance Code, as added by this
353	353	Act.
354	354	SECTION 3. This Act takes effect immediately if it receives
355	355	a vote of two-thirds of all the members elected to each house, as
356	356	provided by Section 39, Article III, Texas Constitution. If this
357	357	Act does not receive the vote necessary for immediate effect, this
358	358	Act takes effect September 1, 2021.