BILL ANALYSIS H.B. 3126 By: Darby Pensions, Investments & Financial Services Committee Report (Unamended) BACKGROUND AND PURPOSE During the 87th Regular Session, the Texas Legislature passed S.B. 1444, which authorized participating entities in TRS-ActiveCare to voluntarily leave the program beginning September 1, 2022. The bill author has informed the committee that school districts in House District 72 elected to leave the program under that mechanism, believing that a private plan could provide lower market rates and cheaper premiums than TRS-ActiveCare. However, after their provider filed for bankruptcy, those school districts were left to foot the bill for massive medical costs that threaten the small, rural school districts of House District 72. H.B. 3126 seeks to provide a limited exception to address this problem by allowing small school districts that left TRS-ActiveCare using this mechanism to rejoin under certain conditions. CRIMINAL JUSTICE IMPACT It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision. RULEMAKING AUTHORITY It is the committee's opinion that rulemaking authority is expressly granted to the Teacher Retirement System of Texas in SECTION 1 of this bill. ANALYSIS H.B. 3126 amends the Insurance Code to authorize a public school district that discontinued participation in TRS-ActiveCare effective on September 1, 2022, to elect to participate in TRS-ActiveCare before the fifth anniversary of that effective date if the district has 500 or fewer employees at the time of that election and does the following: provides written notice to the Teacher Retirement System of Texas (TRS) not later than December 31, 2025, of the district's election to participate in TRS-ActiveCare effective beginning September 1, 2026; and complies with any other requirements established by TRS for TRS-ActiveCare participation. H.B. 3126 requires TRS, for the plan year beginning September 1, 2026, to impose a risk stabilization fee in an amount determined by TRS on the premiums of such a district. The bill prohibits a district that elects to participate in TRS-ActiveCare in accordance with the bill from electing to discontinue participation until September 1, 2031. The bill authorizes TRS by rule to impose additional requirements, conditions, and deadlines with which an applicable district must comply to elect to participate in TRS-ActiveCare in accordance with the bill. The bill's provisions expire September 1, 2031. EFFECTIVE DATE September 1, 2025.
BILL ANALYSIS
# BILL ANALYSIS
H.B. 3126
By: Darby
Pensions, Investments & Financial Services
Committee Report (Unamended)
H.B. 3126
By: Darby
Pensions, Investments & Financial Services
Committee Report (Unamended)
BACKGROUND AND PURPOSE During the 87th Regular Session, the Texas Legislature passed S.B. 1444, which authorized participating entities in TRS-ActiveCare to voluntarily leave the program beginning September 1, 2022. The bill author has informed the committee that school districts in House District 72 elected to leave the program under that mechanism, believing that a private plan could provide lower market rates and cheaper premiums than TRS-ActiveCare. However, after their provider filed for bankruptcy, those school districts were left to foot the bill for massive medical costs that threaten the small, rural school districts of House District 72. H.B. 3126 seeks to provide a limited exception to address this problem by allowing small school districts that left TRS-ActiveCare using this mechanism to rejoin under certain conditions.
CRIMINAL JUSTICE IMPACT It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
RULEMAKING AUTHORITY It is the committee's opinion that rulemaking authority is expressly granted to the Teacher Retirement System of Texas in SECTION 1 of this bill.
ANALYSIS H.B. 3126 amends the Insurance Code to authorize a public school district that discontinued participation in TRS-ActiveCare effective on September 1, 2022, to elect to participate in TRS-ActiveCare before the fifth anniversary of that effective date if the district has 500 or fewer employees at the time of that election and does the following: provides written notice to the Teacher Retirement System of Texas (TRS) not later than December 31, 2025, of the district's election to participate in TRS-ActiveCare effective beginning September 1, 2026; and complies with any other requirements established by TRS for TRS-ActiveCare participation. H.B. 3126 requires TRS, for the plan year beginning September 1, 2026, to impose a risk stabilization fee in an amount determined by TRS on the premiums of such a district. The bill prohibits a district that elects to participate in TRS-ActiveCare in accordance with the bill from electing to discontinue participation until September 1, 2031. The bill authorizes TRS by rule to impose additional requirements, conditions, and deadlines with which an applicable district must comply to elect to participate in TRS-ActiveCare in accordance with the bill. The bill's provisions expire September 1, 2031.
EFFECTIVE DATE September 1, 2025.
BACKGROUND AND PURPOSE
During the 87th Regular Session, the Texas Legislature passed S.B. 1444, which authorized participating entities in TRS-ActiveCare to voluntarily leave the program beginning September 1, 2022. The bill author has informed the committee that school districts in House District 72 elected to leave the program under that mechanism, believing that a private plan could provide lower market rates and cheaper premiums than TRS-ActiveCare. However, after their provider filed for bankruptcy, those school districts were left to foot the bill for massive medical costs that threaten the small, rural school districts of House District 72. H.B. 3126 seeks to provide a limited exception to address this problem by allowing small school districts that left TRS-ActiveCare using this mechanism to rejoin under certain conditions.
CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
RULEMAKING AUTHORITY
It is the committee's opinion that rulemaking authority is expressly granted to the Teacher Retirement System of Texas in SECTION 1 of this bill.
ANALYSIS
H.B. 3126 amends the Insurance Code to authorize a public school district that discontinued participation in TRS-ActiveCare effective on September 1, 2022, to elect to participate in TRS-ActiveCare before the fifth anniversary of that effective date if the district has 500 or fewer employees at the time of that election and does the following:
provides written notice to the Teacher Retirement System of Texas (TRS) not later than December 31, 2025, of the district's election to participate in TRS-ActiveCare effective beginning September 1, 2026; and
complies with any other requirements established by TRS for TRS-ActiveCare participation.
H.B. 3126 requires TRS, for the plan year beginning September 1, 2026, to impose a risk stabilization fee in an amount determined by TRS on the premiums of such a district. The bill prohibits a district that elects to participate in TRS-ActiveCare in accordance with the bill from electing to discontinue participation until September 1, 2031. The bill authorizes TRS by rule to impose additional requirements, conditions, and deadlines with which an applicable district must comply to elect to participate in TRS-ActiveCare in accordance with the bill. The bill's provisions expire September 1, 2031.
EFFECTIVE DATE
September 1, 2025.