Texas 2023 - 88th Regular

Texas House Bill HB700 Compare Versions

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1	1	88R3234 MEW-F
2	2	By: Oliverson H.B. No. 700
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to creation of the Texas Health Insurance Exchange;
8	8	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. TEXAS HEALTH INSURANCE EXCHANGE
13	13	SUBCHAPTER A. GENERAL PROVISIONS
14	14	Sec. 1511.001. DEFINITIONS. In this chapter:
15	15	(1) "Board" means the board of directors of the
16	16	exchange.
17	17	(2) "Exchange" means the Texas Health Insurance
18	18	Exchange.
19	19	(3) "Executive commissioner" means the executive
20	20	commissioner of the Health and Human Services Commission.
21	21	(4) "Qualified health plan" means a health benefit
22	22	plan that has been certified by the board as meeting the criteria
23	23	established under Section 1311(c), Patient Protection and
24	24	Affordable Care Act (42 U.S.C. Section 18031(c)).
25	25	(5) "Secretary" means the secretary of the United
26	26	States Department of Health and Human Services.
27	27	Sec. 1511.002. DEFINITION OF HEALTH BENEFIT PLAN. (a) In
28	28	this chapter, "health benefit plan" means an insurance policy,
29	29	insurance agreement, evidence of coverage, or other similar
30	30	coverage document that provides coverage for medical or surgical
31	31	expenses incurred as a result of a health condition, accident, or
32	32	sickness that is issued by:
33	33	(1) an insurance company;
34	34	(2) a group hospital service corporation operating
35	35	under Chapter 842;
36	36	(3) a health maintenance organization operating under
37	37	Chapter 843;
38	38	(4) an approved nonprofit health corporation that
39	39	holds a certificate of authority under Chapter 844;
40	40	(5) a multiple employer welfare arrangement that holds
41	41	a certificate of authority under Chapter 846;
42	42	(6) a stipulated premium company operating under
43	43	Chapter 884;
44	44	(7) a fraternal benefit society operating under
45	45	Chapter 885; or
46	46	(8) an exchange operating under Chapter 942.
47	47	(b) In this chapter, "health benefit plan" does not include:
48	48	(1) a plan that provides coverage:
49	49	(A) for wages or payments in lieu of wages for a
50	50	period during which an employee is absent from work because of
51	51	sickness or injury;
52	52	(B) as a supplement to a liability insurance
53	53	policy;
54	54	(C) for credit insurance;
55	55	(D) only for vision care;
56	56	(E) only for hospital expenses; or
57	57	(F) only for indemnity for hospital confinement;
58	58	(2) a Medicare supplemental policy as defined by
59	59	Section 1882(g)(1), Social Security Act (42 U.S.C. Section
60	60	1395ss(g)(1));
61	61	(3) a workers' compensation insurance policy; or
62	62	(4) medical payment insurance coverage provided under
63	63	a motor vehicle insurance policy.
64	64	Sec. 1511.003. TREATMENT OF EMPLOYERS. (a) For purposes of
65	65	this chapter, "small employer" means a person who employed at least
66	66	two, and an average of not more than 50 employees during the
67	67	preceding calendar year. This subsection expires December 31,
68	68	2025.
69	69	(b) All persons treated as a single employer under Section
70	70	414(b), (c), (m), or (o), Internal Revenue Code of 1986, are single
71	71	employers for purposes of this chapter.
72	72	(c) An employer and any predecessor employer are a single
73	73	employer for purposes of this chapter.
74	74	(d) In determining the number of employees of an employer
75	75	under this section, the number of employees:
76	76	(1) includes part-time employees and employees who are
77	77	not eligible for coverage through the employer; and
78	78	(2) for an employer that did not have employees during
79	79	the entire preceding calendar year, is the average number of
80	80	employees that the employer is reasonably expected to employ on
81	81	business days in the current calendar year.
82	82	(e) A small employer that makes enrollment in qualified
83	83	health plans available to its employees through the exchange and
84	84	ceases to be a small employer by reason of an increase in the number
85	85	of its employees continues to be a small employer for purposes of
86	86	this chapter as long as it continuously makes enrollment through
87	87	the exchange available to its employees.
88	88	Sec. 1511.004. RULEMAKING AUTHORITY. The board may adopt
89	89	rules necessary and proper to implement this chapter. Rules adopted
90	90	under this section may not conflict with or prevent the application
91	91	of regulations promulgated by the secretary under the Patient
92	92	Protection and Affordable Care Act (Pub. L. No. 111-148).
93	93	Sec. 1511.005. AGENCY COOPERATION. (a) The exchange, the
94	94	department, and the Health and Human Services Commission shall
95	95	cooperate fully in performing their respective duties under this
96	96	code or another law of this state relating to the operation of the
97	97	exchange.
98	98	(b) The exchange shall cooperate and coordinate with the
99	99	Health and Human Services Commission to facilitate a seamless user
100	100	experience.
101	101	Sec. 1511.006. EXEMPTION FROM STATE TAXES AND FEES. The
102	102	exchange is not subject to any state tax, regulatory fee, or
103	103	surcharge, including a premium or maintenance tax or fee.
104	104	Sec. 1511.007. COMPLIANCE WITH FEDERAL LAW. The exchange
105	105	shall comply with all applicable federal law and regulations.
106	106	Sec. 1511.008. EXEMPTION FROM STATE PURCHASING PROCEDURES.
107	107	The exchange is not subject to state purchasing or procurement
108	108	requirements under Subtitle D, Title 10, Government Code, or any
109	109	other law.
110	110	SUBCHAPTER B. ESTABLISHMENT AND GOVERNANCE
111	111	Sec. 1511.051. ESTABLISHMENT. The Texas Health Insurance
112	112	Exchange is established as an American Health Benefit Exchange and
113	113	a Small Business Health Options Program (SHOP) Exchange authorized
114	114	and required by Section 1311, Patient Protection and Affordable
115	115	Care Act (42 U.S.C. Section 18031).
116	116	Sec. 1511.052. GOVERNANCE OF EXCHANGE; BOARD MEMBERSHIP.
117	117	(a) The exchange is governed by a board of directors.
118	118	(b) The board consists of 11 members as follows:
119	119	(1) five members appointed by the governor, two of
120	120	whom have experience in the health insurance industry;
121	121	(2) three additional members appointed by the governor
122	122	from a list of nominees submitted by the speaker of the house of
123	123	representatives; and
124	124	(3) three members appointed by the lieutenant
125	125	governor.
126	126	(c) In making appointments or nominations under this
127	127	section, the governor, lieutenant governor, and speaker of the
128	128	house of representatives shall attempt to make appointments and
129	129	nominations that increase the board's diversity of expertise.
130	130	Sec. 1511.053. PRESIDING OFFICER. The board shall annually
131	131	designate one member of the board to serve as presiding officer.
132	132	Sec. 1511.054. TERMS; VACANCY. (a) Appointed members of
133	133	the board serve two-year terms, with the members' terms expiring
134	134	February 1 of each odd-numbered year.
135	135	(b) The appropriate appointing authority shall fill a
136	136	vacancy on the board by appointing, for the unexpired term, an
137	137	individual who has the appropriate qualifications to fill that
138	138	position.
139	139	Sec. 1511.055. CONFLICT OF INTEREST. (a) Any board member
140	140	or a member of a committee formed by the board with a direct
141	141	interest in a matter, personally or through an employer, before the
142	142	board shall abstain from deliberations and actions on the matter in
143	143	which the conflict of interest arises and shall further abstain
144	144	from any vote on the matter, and may not otherwise participate in a
145	145	decision on the matter.
146	146	(b) Each board member shall file a conflict of interest
147	147	statement and a statement of ownership interests with the board to
148	148	ensure disclosure of all existing and potential personal interests
149	149	related to board business.
150	150	(c) A member of the board or of the staff of the exchange may
151	151	not be employed by, affiliated with, a consultant to, a member of
152	152	the board of directors of, or otherwise a representative of a health
153	153	benefit plan issuer or other insurer, an agent or broker, a health
154	154	care provider, or a health care facility or health clinic while
155	155	serving on the board or on the staff of the exchange.
156	156	(d) A member of the board or of the staff of the exchange may
157	157	not be a member, a board member, or an employee of a trade
158	158	association of health benefit plan issuers, health facilities,
159	159	health clinics, or health care providers while serving on the board
160	160	or on the staff of the exchange.
161	161	(e) A member of the board or of the staff of the exchange may
162	162	not be a health care provider unless the member receives no
163	163	compensation for rendering services as a health care provider and
164	164	does not have an ownership interest in a professional health care
165	165	practice.
166	166	Sec. 1511.056. GENERAL DUTIES OF BOARD MEMBERS. (a) Each
167	167	board member has the responsibility and duty to meet the
168	168	requirements of this title and applicable state and federal laws
169	169	and regulations, to serve the public interest of the individuals
170	170	and small businesses seeking health benefit plan coverage through
171	171	the exchange, and to ensure the operational well-being and fiscal
172	172	solvency of the exchange.
173	173	(b) A member of the board may not make, participate in
174	174	making, or in any way attempt to use the board member's official
175	175	position to influence the making of any decision that the board
176	176	member knows or has reason to know will have a material financial
177	177	effect, distinguishable from its effect on the public generally, on
178	178	the board member or the board member's immediate family, or on:
179	179	(1) any source of income, other than gifts and loans by
180	180	a commercial lending institution in the regular course of business
181	181	on terms available to the public generally, aggregating $250 or
182	182	more in value, provided or promised to the member within the 12
183	183	months immediately preceding the date the decision is made; or
184	184	(2) any business entity in which the member is a
185	185	director, officer, partner, trustee, or employee, or holds any
186	186	position of management.
187	187	Sec. 1511.057. REIMBURSEMENT. A member of the board is not
188	188	entitled to compensation but is entitled to reimbursement for
189	189	travel or other expenses incurred while performing duties as a
190	190	board member in the amount provided by the General Appropriations
191	191	Act for state officials.
192	192	Sec. 1511.058. MEMBER'S IMMUNITY. (a) A member of the
193	193	board is not liable for an act or omission made in good faith in the
194	194	performance of powers and duties under this chapter.
195	195	(b) A cause of action does not arise against a member of the
196	196	board for an act or omission described by Subsection (a).
197	197	Sec. 1511.059. OPEN RECORDS AND OPEN MEETINGS. The board is
198	198	subject to Chapters 551 and 552, Government Code.
199	199	Sec. 1511.060. RECORDS. The board shall keep records of the
200	200	board's proceedings for at least seven years.
201	201	SUBCHAPTER C. POWERS AND DUTIES OF EXCHANGE
202	202	Sec. 1511.101. EMPLOYEES; COMMITTEES. (a) The board may
203	203	employ an executive director and any other agents and employees
204	204	that the board considers necessary to assist the exchange in
205	205	carrying out its responsibilities and functions.
206	206	(b) The executive director shall organize, administer, and
207	207	manage the operations of the exchange. The executive director may
208	208	hire other employees as necessary to carry out the responsibilities
209	209	of the exchange.
210	210	(c) The exchange may appoint appropriate legal, actuarial,
211	211	and other committees necessary to provide technical assistance in
212	212	operating the exchange and performing any of the functions of the
213	213	exchange.
214	214	Sec. 1511.102. ADVISORY COMMITTEE. The board may appoint
215	215	an advisory committee to allow for the involvement of the health
216	216	care and health insurance industries and other stakeholders in the
217	217	operation of the exchange. The advisory committee may provide
218	218	expertise and recommendations to the board but may not adopt rules
219	219	or enter into contracts on behalf of the exchange.
220	220	Sec. 1511.103. CONTRACTS. (a) Except as provided by
221	221	Subsection (b), the exchange may enter into any contract that the
222	222	exchange considers necessary to implement or administer this
223	223	chapter, including a contract with the department, the Health and
224	224	Human Services Commission, or an entity that has experience in
225	225	individual and small group health insurance, benefit
226	226	administration, or other experience relevant to the
227	227	responsibilities assumed by the entity, to perform functions or
228	228	provide services in connection with the operation of the exchange.
229	229	(b) This exchange may not enter into a contract with a
230	230	health benefit plan issuer under this section.
231	231	Sec. 1511.104. INFORMATION SHARING AND CONFIDENTIALITY.
232	232	The exchange may enter into information-sharing agreements with
233	233	federal and state agencies to carry out the exchange's
234	234	responsibilities under this chapter. An agreement entered into
235	235	under this section must include adequate protection with respect to
236	236	the confidentiality of any information shared and comply with all
237	237	applicable state and federal law.
238	238	Sec. 1511.105. MEMORANDUM OF UNDERSTANDING. The exchange
239	239	shall enter into a memorandum of understanding with the department
240	240	and the Health and Human Services Commission regarding the exchange
241	241	of information and the division of regulatory functions among the
242	242	exchange, the department, and the commission.
243	243	Sec. 1511.106. LEGAL ACTION. (a) The exchange may sue or
244	244	be sued.
245	245	(b) The exchange may take any legal action necessary to
246	246	recover or collect amounts due the exchange, including:
247	247	(1) assessments due the exchange;
248	248	(2) amounts erroneously or improperly paid by the
249	249	exchange; and
250	250	(3) amounts paid by the exchange as a mistake of fact
251	251	or law.
252	252	Sec. 1511.107. FUNCTIONS. The exchange shall perform all
253	253	functions and duties related to state-based exchanges required by
254	254	applicable state and federal law.
255	255	Sec. 1511.108. HEALTH CARE PROVIDER DIRECTORY AND
256	256	INFORMATION. (a) The exchange may provide an integrated and
257	257	uniform consumer directory of health care providers indicating
258	258	which health benefit plan issuers the providers contract with and
259	259	whether the providers are currently accepting new patients.
260	260	(b) The exchange may establish methods by which health care
261	261	providers may transmit relevant information directly to the
262	262	exchange, rather than through an issuer.
263	263	Sec. 1511.109. STATE-ADMINISTERED SUBSIDY PROGRAM. (a) Not
264	264	later than July 1, 2024, the exchange, in coordination with the
265	265	department, shall review and make recommendations to the Senate
266	266	Business and Commerce Committee and the House of Representatives
267	267	Insurance Committee regarding the feasibility of implementing a
268	268	state-administered subsidy program for individuals, families, and
269	269	small employers to purchase health benefit plan coverage.
270	270	(b) With the input and approval of the Senate Business and
271	271	Commerce Committee and the House of Representatives Insurance
272	272	Committee, the exchange may develop and implement a
273	273	state-administered subsidy program.
274	274	Sec. 1511.110. FEDERAL WAIVERS. (a) Not later than July 1,
275	275	2024, the exchange, in coordination with the department, shall
276	276	review and make recommendations to the Senate Business and Commerce
277	277	Committee and the House of Representatives Insurance Committee
278	278	regarding the submission of a state innovation waiver that may be
279	279	granted under Section 1332, Patient Protection and Affordable Care
280	280	Act (42 U.S.C. Section 18052), with respect to health benefit plan
281	281	coverage or health insurance products in this state, including
282	282	recommendations on:
283	283	(1) risk stabilization strategies aimed at addressing
284	284	risk associated with individuals with high health care costs;
285	285	(2) individual coverage health reimbursement
286	286	arrangements for employees of large and small businesses in this
287	287	state;
288	288	(3) financial assistance for different types of health
289	289	benefit plan coverage, including non-qualified health plans for
290	290	individuals purchasing coverage; and
291	291	(4) the establishment of account-based premium
292	292	credits for individuals and families enrolled in coverage through
293	293	the exchange.
294	294	(b) With the input and approval of the Senate Business and
295	295	Commerce Committee and the House of Representatives Insurance
296	296	Committee, the exchange may submit one or more applications to the
297	297	secretary to obtain a waiver of any applicable provisions of the
298	298	Patient Protection and Affordable Care Act (Pub. L. No. 111-148).
299	299	(c) On approval by the secretary of a waiver under
300	300	Subsection (b), the exchange may implement the approved waiver.
301	301	SUBCHAPTER D. ASSESSMENTS FOR OPERATION OF EXCHANGE
302	302	Sec. 1511.151. ASSESSMENTS. (a) The exchange may charge
303	303	the issuers of health benefit plans in this state, including
304	304	qualified health plans, an assessment as reasonable and necessary
305	305	to cover the exchange's organizational and operating expenses and
306	306	expenses related to health coverage programs associated with the
307	307	exchange. Assessments must be determined annually. The exchange
308	308	may charge interest for late assessments.
309	309	(b) The commissioner shall adopt rules to implement and
310	310	enforce the assessment of health benefit plan issuers under this
311	311	section.
312	312	Sec. 1511.152. GRANTS AND FEDERAL FUNDS. (a) The exchange
313	313	may accept a grant from a public or private organization and may
314	314	spend those funds to pay the costs of program administration and
315	315	operations.
316	316	(b) The exchange may accept federal funds and shall use
317	317	those funds in compliance with applicable federal law, regulations,
318	318	and guidelines.
319	319	Sec. 1511.153. USE OF EXCHANGE ASSETS; ANNUAL REPORT. (a)
320	320	The assets of the exchange may be used only to pay the costs:
321	321	(1) of the administration and operation of the
322	322	exchange; and
323	323	(2) associated with any health coverage programs
324	324	associated with the exchange.
325	325	(b) The exchange shall prepare annually a complete and
326	326	detailed written report accounting for all funds received and
327	327	disbursed by the exchange during the preceding fiscal year. The
328	328	report must meet any reporting requirements provided in the General
329	329	Appropriations Act, regardless of whether the exchange receives any
330	330	funds under that Act. The exchange shall submit the report to the
331	331	governor, the legislature, the commissioner, and the executive
332	332	commissioner not later than January 31 of each year.
333	333	(c) General revenue may not be appropriated for the
334	334	exchange.
335	335	Sec. 1511.154. PUBLICATION OF FINANCIAL INFORMATION. The
336	336	exchange shall publish the average costs of licensing, regulatory
337	337	fees, and any other payments required by the exchange, and the
338	338	administrative costs of the exchange, on an Internet website to
339	339	educate consumers on those costs. This information must include
340	340	information on losses due to waste, fraud, and abuse.
341	341	SUBCHAPTER E. TRUST FUND
342	342	Sec. 1511.201. TRUST FUND. (a) The exchange fund is
343	343	established as a special trust fund outside of the state treasury in
344	344	the custody of the comptroller separate and apart from all public
345	345	money or funds of this state.
346	346	(b) The exchange may deposit assessments, gifts or
347	347	donations, and any federal funding obtained by the exchange in the
348	348	exchange fund in accordance with procedures established by the
349	349	comptroller.
350	350	(c) Interest or other income from the investment of the fund
351	351	shall be deposited to the credit of the fund.
352	352	SECTION 2. Effective January 1, 2026, Section 1511.003,
353	353	Insurance Code, as added by this Act, is amended by adding
354	354	Subsection (a-1) to read as follows:
355	355	(a-1) For purposes of this chapter, "small employer" means a
356	356	person who employed an average of not more than 100 employees during
357	357	the preceding calendar year.
358	358	SECTION 3. (a) As soon as practicable after the effective
359	359	date of this Act, but not later than October 31, 2023, the governor
360	360	and lieutenant governor shall appoint the initial members of the
361	361	board of directors of the Texas Health Insurance Exchange.
362	362	(b) As soon as practicable after the appointments required
363	363	by Subsection (a) of this section are made, but not later than
364	364	November 30, 2023, the board of directors of the Texas Health
365	365	Insurance Exchange shall hold a special meeting to discuss the
366	366	adoption of rules and procedures necessary to implement Chapter
367	367	1511, Insurance Code, as added by this Act.
368	368	(c) As soon as practicable after the effective date of this
369	369	Act, but not later than January 31, 2024, the board of directors of
370	370	the Texas Health Insurance Exchange shall adopt rules and
371	371	procedures necessary to implement Chapter 1511, Insurance Code, as
372	372	added by this Act.
373	373	(d) If, after the effective date of this Act but before the
374	374	initial members of the board of directors of the Texas Health
375	375	Insurance Exchange have been appointed as required by Subsection
376	376	(a) of this section, the Texas Department of Insurance becomes
377	377	aware of any planning and establishment grants as described by
378	378	Section 1311, Patient Protection and Affordable Care Act (42 U.S.C.
379	379	Section 18031), or any other public or private funding source, the
380	380	department may apply for funding from that source.
381	381	(e) The exchange may not begin operations without adequate
382	382	funding.
383	383	(f) The board of directors of the Texas Health Insurance
384	384	Exchange may adopt rules on an emergency basis in accordance with
385	385	Section 2001.034, Government Code. Notwithstanding Section
386	386	2001.034(c), Government Code, a rule adopted under this subsection
387	387	may remain in effect until January 1, 2027. Rules adopted under
388	388	this subsection shall be deemed necessary for the immediate
389	389	preservation of the public peace, health, safety, and general
390	390	welfare and an additional finding under Sections 2001.034(a)(1) and
391	391	(2), Government Code, is not required. The authority to adopt rules
392	392	under this subsection expires January 1, 2027.
393	393	SECTION 4. This Act takes effect immediately if it receives
394	394	a vote of two-thirds of all the members elected to each house, as
395	395	provided by Section 39, Article III, Texas Constitution. If this
396	396	Act does not receive the vote necessary for immediate effect, this
397	397	Act takes effect September 1, 2023.