Texas 2025 - 89th Regular

Texas House Bill HB5455 Compare Versions

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Old	New	Differences
1	1	89R15813 SCF-F
2	2	By: Raymond H.B. No. 5455
3	3
4	4
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to creation of the Texas Health Insurance Exchange;
10	10	authorizing a fee.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Subtitle G, Title 8, Insurance Code, is amended
13	13	by adding Chapter 1511 to read as follows:
14	14	CHAPTER 1511. TEXAS HEALTH INSURANCE EXCHANGE
15	15	SUBCHAPTER A. GENERAL PROVISIONS
16	16	Sec. 1511.001. DEFINITIONS. In this chapter:
17	17	(1) "Board" means the board of directors of the
18	18	exchange.
19	19	(2) "Exchange" means the Texas Health Insurance
20	20	Exchange.
21	21	(3) "Executive commissioner" means the executive
22	22	commissioner of the Health and Human Services Commission.
23	23	(4) "Qualified health plan" means a health benefit
24	24	plan that has been certified by the board as meeting the criteria
25	25	established under Section 1311(c), Patient Protection and
26	26	Affordable Care Act (42 U.S.C. Section 18031(c)).
27	27	(5) "Secretary" means the secretary of the United
28	28	States Department of Health and Human Services.
29	29	Sec. 1511.002. PURPOSE. The purpose of this chapter is to
30	30	create, manage, and maintain the exchange to:
31	31	(1) benefit the state health insurance market and
32	32	individuals enrolling in health benefit plans;
33	33	(2) facilitate or assist in facilitating the
34	34	purchasing of qualified health plans on the exchange by qualified
35	35	enrollees in the individual market or the individual and small
36	36	group markets; and
37	37	(3) minimize barriers to enrollment in qualified
38	38	health plans offered on the exchange.
39	39	Sec. 1511.003. TREATMENT OF EMPLOYERS. (a) For purposes of
40	40	this chapter, "small employer" means a person who employed at least
41	41	two, and an average of not more than 50 employees during the
42	42	preceding calendar year.
43	43	(b) All persons treated as a single employer under Section
44	44	414(b), (c), (m), or (o), Internal Revenue Code of 1986, are single
45	45	employers for purposes of this chapter.
46	46	(c) An employer and any predecessor employer are a single
47	47	employer for purposes of this chapter.
48	48	(d) In determining the number of employees of an employer
49	49	under this section, the number of employees:
50	50	(1) includes part-time employees and employees who are
51	51	not eligible for coverage through the employer; and
52	52	(2) for an employer that did not have employees during
53	53	the entire preceding calendar year, is the average number of
54	54	employees that the employer is reasonably expected to employ on
55	55	business days in the current calendar year.
56	56	(e) A small employer that makes enrollment in qualified
57	57	health plans available to its employees through the exchange and
58	58	ceases to be a small employer by reason of an increase in the number
59	59	of its employees continues to be a small employer for purposes of
60	60	this chapter as long as it continuously makes enrollment through
61	61	the exchange available to its employees.
62	62	Sec. 1511.004. RULEMAKING AUTHORITY. The board may adopt
63	63	rules necessary and proper to implement this chapter. Rules adopted
64	64	under this section may not conflict with or prevent the application
65	65	of regulations promulgated by the secretary under the Patient
66	66	Protection and Affordable Care Act (Pub. L. No. 111-148).
67	67	Sec. 1511.005. AGENCY COOPERATION. (a) The exchange, the
68	68	department, and the Health and Human Services Commission shall
69	69	cooperate fully in performing their respective duties under this
70	70	code or another law of this state relating to the operation of the
71	71	exchange.
72	72	(b) The Health and Human Services Commission shall
73	73	cooperate and coordinate with the exchange to ensure eligibility
74	74	systems are able to communicate and are sufficiently integrated to
75	75	facilitate a seamless user experience.
76	76	Sec. 1511.006. THIRD PARTY AUDIT OF EXCHANGE SYSTEM. (a)
77	77	Before the initial open enrollment period for the exchange, the
78	78	board shall engage an independent third party audit team that
79	79	specializes in exchange system technology to:
80	80	(1) verify and validate new technology functionality
81	81	throughout the design, development, and implementation phases of
82	82	the exchange system to ensure the system is working as designed and
83	83	intended; and
84	84	(2) provide to the board a report on the team's
85	85	findings.
86	86	(b) The earliest initial enrollment period for the exchange
87	87	may not begin until after the board receives the audit team's report
88	88	under Subsection (a).
89	89	Sec. 1511.007. EXEMPTION FROM STATE TAXES AND FEES. The
90	90	exchange is not subject to any state tax, regulatory fee, or
91	91	surcharge, including a premium or maintenance tax or fee.
92	92	Sec. 1511.008. COMPLIANCE WITH FEDERAL LAW. The exchange
93	93	shall comply with all applicable federal law and regulations.
94	94	Sec. 1511.009. EXEMPTION FROM STATE PURCHASING PROCEDURES.
95	95	The exchange is not subject to state purchasing or procurement
96	96	requirements under Subtitle D, Title 10, Government Code, or any
97	97	other law.
98	98	SUBCHAPTER B. ESTABLISHMENT AND GOVERNANCE
99	99	Sec. 1511.051. ESTABLISHMENT. The Texas Health Insurance
100	100	Exchange is established as an American Health Benefit Exchange and
101	101	a Small Business Health Options Program (SHOP) Exchange authorized
102	102	and required by Section 1311, Patient Protection and Affordable
103	103	Care Act (42 U.S.C. Section 18031).
104	104	Sec. 1511.052. GOVERNANCE OF EXCHANGE; BOARD MEMBERSHIP.
105	105	(a) The exchange is governed by a board of directors.
106	106	(b) The board consists of the following 11 members:
107	107	(1) nine members appointed as follows:
108	108	(A) three members appointed by the governor;
109	109	(B) three additional members appointed by the
110	110	governor from a list of nominees submitted by the speaker of the
111	111	house of representatives; and
112	112	(C) three members appointed by the lieutenant
113	113	governor; and
114	114	(2) two ex officio, nonvoting members as follows:
115	115	(A) the commissioner or the commissioner's
116	116	designee; and
117	117	(B) the executive commissioner or the executive
118	118	commissioner's designee.
119	119	(c) In making appointments or nominations under this
120	120	section, the governor, lieutenant governor, and speaker of the
121	121	house of representatives must include representation from
122	122	participating health plans, consumers, small employers, brokers,
123	123	or providers.
124	124	Sec. 1511.053. PRESIDING OFFICER. The board shall annually
125	125	designate one member of the board to serve as presiding officer.
126	126	Sec. 1511.054. TERMS; VACANCY. (a) Appointed members of
127	127	the board serve two-year terms, with the members' terms expiring
128	128	February 1 of each odd-numbered year.
129	129	(b) Members may be reappointed but may not serve more than
130	130	three terms.
131	131	(c) The appropriate appointing authority shall fill a
132	132	vacancy on the board by appointing, for the unexpired term, an
133	133	individual who has the appropriate qualifications to fill that
134	134	position.
135	135	Sec. 1511.055. CONFLICT OF INTEREST. (a) Any board member
136	136	or a member of a committee formed by the board with a direct
137	137	personal interest in a matter before the board shall abstain from
138	138	deliberations and actions on the matter in which the conflict of
139	139	interest arises and shall further abstain from any vote on the
140	140	matter, and may not otherwise participate in a decision on the
141	141	matter.
142	142	(b) Each board member shall file a conflict of interest
143	143	statement and a statement of ownership interests with the board to
144	144	ensure disclosure of all existing and potential personal interests
145	145	related to board business.
146	146	Sec. 1511.056. GENERAL DUTIES OF BOARD MEMBERS. (a) Each
147	147	board member has the responsibility and duty to meet the
148	148	requirements of this title and applicable state and federal laws
149	149	and regulations, to serve the public interest of the individuals
150	150	and small businesses seeking health benefit plan coverage through
151	151	the exchange, and to ensure the operational well-being and fiscal
152	152	solvency of the exchange.
153	153	(b) A member of the board may not make, participate in
154	154	making, or in any way attempt to use the board member's official
155	155	position to influence the making of any decision that the board
156	156	member knows or has reason to know will have a material financial
157	157	effect, distinguishable from its effect on the public generally, on
158	158	the board member or the board member's immediate family, or on:
159	159	(1) any source of income, other than gifts and loans by
160	160	a commercial lending institution in the regular course of business
161	161	on terms available to the public generally, aggregating $250 or
162	162	more in value, provided or promised to the member within the 12
163	163	months immediately preceding the date the decision is made; or
164	164	(2) any business entity in which the member is a
165	165	director, officer, partner, trustee, or employee, or holds any
166	166	position of management.
167	167	Sec. 1511.057. REIMBURSEMENT. A member of the board is not
168	168	entitled to compensation but is entitled to reimbursement for
169	169	travel or other expenses incurred while performing duties as a
170	170	board member in the amount provided by the General Appropriations
171	171	Act for state officials.
172	172	Sec. 1511.058. MEMBER'S IMMUNITY. (a) A member of the
173	173	board is not liable for an act or omission made in good faith in the
174	174	performance of powers and duties under this chapter.
175	175	(b) A cause of action does not arise against a member of the
176	176	board for an act or omission described by Subsection (a).
177	177	Sec. 1511.059. OPEN RECORDS AND OPEN MEETINGS. The board is
178	178	subject to Chapters 551 and 552, Government Code.
179	179	Sec. 1511.060. RECORDS. The board shall keep records of the
180	180	board's proceedings for at least seven years.
181	181	SUBCHAPTER C. POWERS AND DUTIES OF EXCHANGE
182	182	Sec. 1511.101. EMPLOYEES; WORKING GROUPS. (a) The board
183	183	may employ an executive director and any other agents and employees
184	184	that the board considers necessary to assist the exchange in
185	185	carrying out its responsibilities and functions.
186	186	(b) The executive director shall organize, administer, and
187	187	manage the operations of the exchange. The executive director may
188	188	hire other employees as necessary to carry out the responsibilities
189	189	of the exchange.
190	190	(c) The exchange may appoint appropriate legal, actuarial,
191	191	technology, and other working groups necessary to provide
192	192	assistance in operating the exchange and performing any of the
193	193	functions of the exchange.
194	194	(d) The exchange shall on a regular basis make exchange
195	195	enrollment data available through public use files.
196	196	Sec. 1511.102. ADVISORY COMMITTEE. The board shall appoint
197	197	an advisory committee to allow for the involvement of key
198	198	stakeholders in the operation of the exchange. The advisory
199	199	committee may provide expertise and recommendations to the board
200	200	but may not adopt rules or enter into contracts on behalf of the
201	201	exchange.
202	202	Sec. 1511.103. CONTRACTS. (a) Except as provided by
203	203	Subsection (b), the exchange may enter into any contract that the
204	204	exchange considers necessary to implement or administer this
205	205	chapter, including a contract with the department, the Health and
206	206	Human Services Commission, or an entity that has experience in
207	207	individual and small group health insurance, benefit
208	208	administration, or other experience relevant to the
209	209	responsibilities assumed by the entity, to perform functions or
210	210	provide services in connection with the operation of the exchange.
211	211	(b) The exchange may not enter into a contract with a health
212	212	benefit plan issuer under this section.
213	213	(c) The exchange shall develop and adopt a competitive
214	214	procurement process that promotes fairness and efficiency and
215	215	best-in-class performance for each functional component of the
216	216	exchange.
217	217	Sec. 1511.104. INFORMATION SHARING AND CONFIDENTIALITY.
218	218	(a) The exchange may enter into information-sharing agreements
219	219	with federal and state agencies to carry out the exchange's
220	220	responsibilities under this chapter. An agreement entered into
221	221	under this section must include adequate protection with respect to
222	222	the confidentiality of any information shared and comply with all
223	223	applicable state and federal law.
224	224	(b) The exchange shall protect personally identifiable
225	225	health and financial information in accordance with all applicable
226	226	state and federal laws and regulations.
227	227	Sec. 1511.105. MEMORANDUM OF UNDERSTANDING. The exchange
228	228	shall enter into a memorandum of understanding with the department
229	229	and the Health and Human Services Commission regarding the exchange
230	230	of information and the division of regulatory functions among the
231	231	exchange, the department, and the commission.
232	232	Sec. 1511.106. LEGAL ACTION. (a) The exchange may sue or
233	233	be sued.
234	234	(b) The exchange may take any legal action necessary to
235	235	recover or collect amounts due the exchange, including:
236	236	(1) fees due the exchange;
237	237	(2) amounts erroneously or improperly paid by the
238	238	exchange; and
239	239	(3) amounts paid by the exchange as a mistake of fact
240	240	or law.
241	241	Sec. 1511.107. FUNCTIONS. (a) The exchange shall perform
242	242	all functions and duties related to state-based exchanges required
243	243	by applicable state and federal law, except for functions and
244	244	duties related to the federal risk adjustment program.
245	245	(b) The exchange shall replicate, to the extent feasible,
246	246	the processes and enrollment formats used by the federal health
247	247	insurance exchange to ensure a successful implementation and
248	248	encourage health plan participation on the exchange.
249	249	Sec. 1511.108. HEALTH CARE PROVIDER DIRECTORY AND
250	250	INFORMATION. (a) The exchange may provide an integrated and
251	251	uniform consumer directory of health care providers indicating
252	252	which health benefit plan issuers the providers contract with and
253	253	whether the providers are currently accepting new patients.
254	254	(b) The exchange may establish methods by which health care
255	255	providers may transmit relevant information directly to the
256	256	exchange, rather than through an issuer.
257	257	Sec. 1511.109. STATE-ADMINISTERED SUBSIDY PROGRAM. (a)
258	258	Not later than July 1, 2026, the exchange, in coordination with the
259	259	department, shall review and make recommendations to the Senate
260	260	Business and Commerce Committee and the House of Representatives
261	261	Insurance Committee regarding the feasibility of implementing a
262	262	state-administered subsidy program for individuals, families, and
263	263	small employers to purchase health benefit plan coverage. The
264	264	recommendations must include considerations regarding the best use
265	265	for any savings generated from the transition to a state-based
266	266	health insurance exchange.
267	267	(b) With the input and approval of the Senate Business and
268	268	Commerce Committee and the House of Representatives Insurance
269	269	Committee, the exchange may develop and implement a
270	270	state-administered subsidy program.
271	271	Sec. 1511.110. ENHANCED DIRECT ENROLLMENT PATHWAY. (a)
272	272	The exchange shall create a pathway for web brokers, insurers, and
273	273	licensed health insurance agents and brokers to enroll individuals
274	274	in subsidized coverage in a manner that is consistent with
275	275	enrolling those individuals in coverage through the exchange.
276	276	(b) The exchange shall model the pathway created under
277	277	Subsection (a) after the enhanced direct enrollment pathway
278	278	operated by the federal Centers for Medicare and Medicaid Services
279	279	for the federal health insurance exchange.
280	280	(c) To the extent practicable and consistent with sound
281	281	policy and the goals of the exchange, the pathway created under
282	282	Subsection (a) shall establish standards and requirements for the
283	283	certification of web brokers, insurers, and licensed health
284	284	insurance agents and brokers that are consistent with the standards
285	285	and requirements for certification established for the federal
286	286	health insurance exchange.
287	287	(d) In an effort to minimize duplication of effort and waste
288	288	and to promote sound policy and the goals of the exchange, the
289	289	technical requirements, connection protocols, and security
290	290	standards for the pathway created under Subsection (a) shall be
291	291	consistent with the requirements, protocols, and standards
292	292	developed for the federal health insurance exchange.
293	293	(e) The exchange must create the pathway under Subsection
294	294	(a) as part of the initial development of the exchange and may not
295	295	delay creation of the pathway to a later date.
296	296	Sec. 1511.111. FEDERAL WAIVERS. (a) Not later than July 1,
297	297	2026, the exchange, in coordination with the department, shall
298	298	review and make recommendations to the Senate Business and Commerce
299	299	Committee and the House of Representatives Insurance Committee
300	300	regarding the submission of a state innovation waiver that may be
301	301	granted under Section 1332, Patient Protection and Affordable Care
302	302	Act (42 U.S.C. Section 18052), with respect to health benefit plan
303	303	coverage or health insurance products in this state, including
304	304	recommendations on:
305	305	(1) risk stabilization strategies aimed at addressing
306	306	risk associated with individuals with high health care costs;
307	307	(2) individual coverage health reimbursement
308	308	arrangements for employees of large and small businesses in this
309	309	state;
310	310	(3) financial assistance for different types of health
311	311	benefit plan coverage, including non-qualified health plans for
312	312	individuals purchasing coverage; and
313	313	(4) the establishment of account-based premium
314	314	credits for individuals and families enrolled in coverage through
315	315	the exchange.
316	316	(b) With the input of the Senate Business and Commerce
317	317	Committee and the House of Representatives Insurance Committee, the
318	318	exchange may submit one or more applications to the secretary to
319	319	obtain a waiver of any applicable provisions of the Patient
320	320	Protection and Affordable Care Act (Pub. L. No. 111-148).
321	321	(c) On approval by the secretary of a waiver under
322	322	Subsection (b), the exchange may implement the approved waiver.
323	323	SUBCHAPTER D. FUNDING FOR OPERATION OF EXCHANGE
324	324	Sec. 1511.151. USER FEES. (a) The exchange may charge a
325	325	user fee to issuers offering qualified health plans on the exchange
326	326	as reasonable and necessary to cover the exchange's organizational
327	327	and operating expenses and expenses related to health coverage
328	328	programs associated with the exchange. User fees must be
329	329	determined annually. The exchange may charge interest for late
330	330	user fees. User fees may not exceed three percent of total premiums
331	331	for qualified health plans on the exchange.
332	332	(b) The commissioner shall adopt rules to implement and
333	333	enforce the assessment of user fees for health benefit plan issuers
334	334	offering coverage on the exchange as authorized under this section.
335	335	Sec. 1511.152. GRANTS AND FEDERAL MONEY. (a) The exchange
336	336	may accept a grant from a public or private organization and may
337	337	spend that money to pay the costs of program administration and
338	338	operations.
339	339	(b) The exchange may accept federal money and shall use that
340	340	money in compliance with applicable federal law, regulations, and
341	341	guidelines.
342	342	Sec. 1511.153. USE OF EXCHANGE ASSETS; ANNUAL REPORT. (a)
343	343	The assets of the exchange may be used only to pay the costs:
344	344	(1) of the administration and operation of the
345	345	exchange; and
346	346	(2) associated with any health coverage programs
347	347	associated with the exchange.
348	348	(b) The exchange shall prepare annually a complete and
349	349	detailed written report accounting for all money received and
350	350	disbursed by the exchange during the preceding fiscal year. The
351	351	report must meet any reporting requirements provided in the General
352	352	Appropriations Act, regardless of whether the exchange receives any
353	353	money under that Act. The exchange shall submit the report to the
354	354	governor, the legislature, the commissioner, and the executive
355	355	commissioner not later than January 31 of each year.
356	356	(c) General revenue may not be appropriated for the
357	357	exchange.
358	358	Sec. 1511.154. PUBLICATION OF FINANCIAL INFORMATION. The
359	359	exchange shall publish the average costs of licensing, regulatory
360	360	fees, and any other payments required by the exchange, and the
361	361	administrative costs of the exchange, on an Internet website to
362	362	educate consumers on those costs. This information must include
363	363	information on losses due to waste, fraud, and abuse.
364	364	SUBCHAPTER E. TRUST FUND
365	365	Sec. 1511.201. TRUST FUND. (a) The exchange fund is
366	366	established as a special trust fund outside of the state treasury in
367	367	the custody of the comptroller separate and apart from all public
368	368	money or funds of this state.
369	369	(b) The exchange may deposit fees, gifts or donations, and
370	370	any federal funding obtained by the exchange in the exchange fund in
371	371	accordance with procedures established by the comptroller.
372	372	(c) Interest or other income from the investment of the fund
373	373	shall be deposited to the credit of the fund.
374	374	SECTION 2. (a) As soon as practicable after the effective
375	375	date of this Act, but not later than October 31, 2025, the governor
376	376	and lieutenant governor shall appoint the initial members of the
377	377	board of directors of the Texas Health Insurance Exchange.
378	378	(b) As soon as practicable after the appointments required
379	379	by Subsection (a) of this section are made, but not later than
380	380	November 30, 2025, the board of directors of the Texas Health
381	381	Insurance Exchange shall hold a special meeting to discuss the
382	382	adoption of rules and procedures necessary to implement Chapter
383	383	1511, Insurance Code, as added by this Act.
384	384	(c) As soon as practicable after the effective date of this
385	385	Act, but not later than July 1, 2026, the board of directors of the
386	386	Texas Health Insurance Exchange shall adopt rules and procedures
387	387	necessary to implement Chapter 1511, Insurance Code, as added by
388	388	this Act.
389	389	(d) If, after the effective date of this Act but before the
390	390	initial members of the board of directors of the Texas Health
391	391	Insurance Exchange have been appointed as required by Subsection
392	392	(a) of this section, the Texas Department of Insurance becomes
393	393	aware of any planning and establishment grants as described by
394	394	Section 1311, Patient Protection and Affordable Care Act (42 U.S.C.
395	395	Section 18031), or any other public or private funding source, the
396	396	department may apply for funding from that source.
397	397	(e) The exchange may not begin operations without adequate
398	398	funding.
399	399	(f) The initial coverage period for coverage on the exchange
400	400	may not begin before January 1, 2028.
401	401	SECTION 3. This Act takes effect immediately if it receives
402	402	a vote of two-thirds of all the members elected to each house, as
403	403	provided by Section 39, Article III, Texas Constitution. If this
404	404	Act does not receive the vote necessary for immediate effect, this
405	405	Act takes effect September 1, 2025.