By: Parker S.B. No. 1409
A BILL TO BE ENTITLED
AN ACT
relating to health benefits offered by postsecondary educational
institutions to students and their families.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 1275.002, Insurance Code, is amended to
read as follows:
Sec. 1275.002. APPLICABILITY OF CHAPTER. This chapter
applies only to:
(1) a health benefit plan offered by a nonprofit
agricultural organization under Chapter 1682; [and]
(2) a health benefit plan:
(A) that is a self-insured or self-funded plan
established by an employer for the benefit of the employer's
employees in accordance with the Employee Retirement Income
Security Act of 1974 (29 U.S.C. Section 1001 et seq.); and
(B) for which the plan sponsor has made an
election, submitted to the commissioner in the form and manner
prescribed by the commissioner, to apply this chapter to the plan
for the relevant plan year; and
(3) a health benefit plan offered by a postsecondary
educational institution under Chapter 1683.
SECTION 2. Subtitle K, Title 8, Insurance Code, is amended
by adding Chapter 1683 to read as follows:
CHAPTER 1683. HEALTH BENEFITS PROVIDED BY CERTAIN POSTSECONDARY
EDUCATIONAL INSTITUTIONS
Sec. 1683.001. DEFINITIONS. In this chapter:
(1) "Higher education health benefits" means health
benefits:
(A) sponsored by a postsecondary educational
institution;
(B) offered only to:
(i) students enrolled at the postsecondary
educational institution; and
(ii) family members of students enrolled at
the postsecondary educational institution;
(C) that are not provided through an insurance
policy or other product the offering or issuance of which is
regulated as the business of insurance in this state; and
(D) that are deemed by the postsecondary
educational institution to be important in assisting its students
and their families to live long and productive lives.
(2) "Postsecondary educational institution" means an
institution of higher education or a private or independent
institution of higher education, as those terms are defined by
Section 61.003, Education Code.
(3) "Preexisting condition" means a condition present
before the effective date of an individual's enrollment in higher
education health benefits.
Sec. 1683.002. HIGHER EDUCATION HEALTH BENEFITS
AUTHORIZED. A postsecondary educational institution may offer in
this state higher education health benefits. A postsecondary
educational institution that offers higher education health
benefits under this chapter may not require a student to enroll in
the benefits.
Sec. 1683.003. WAITING PERIOD FOR PREEXISTING CONDITION.
Notwithstanding any other provision of this chapter, a
postsecondary educational institution that offers higher education
health benefits may not require a waiting period of more than six
months for treatment of a preexisting condition otherwise included
in higher education health benefits.
Sec. 1683.004. REQUIRED DISCLOSURE FOR HIGHER EDUCATION
HEALTH BENEFITS. (a) A postsecondary educational institution that
offers higher education health benefits must provide to an
individual applying for higher education health benefits written
notice that the benefits are not provided through an insurance
policy or other product the offering or issuance of which is
regulated as the business of insurance in this state.
(b) An individual must sign and return to the postsecondary
educational institution the notice described by Subsection (a)
before the individual may enroll in higher education health
benefits. The postsecondary educational institution must:
(1) maintain a copy of the signed written notice for
the duration of the term during which the higher education health
benefits are provided to the individual; and
(2) at the request of the individual, provide a copy of
the written notice to the individual.
Sec. 1683.005. POSTSECONDARY EDUCATIONAL INSTITUTION NOT
ENGAGED IN BUSINESS OF HEALTH INSURANCE; REGISTRATION REQUIRED.
(a) Notwithstanding any other provision of this code, for the
purposes of offering higher education health benefits, a
postsecondary educational institution that acts in accordance with
this chapter is not a health insurer and is not engaging in the
business of health insurance in this state.
(b) A postsecondary educational institution that offers
higher education health benefits must register with the department
and provide information as needed to facilitate compliance with
Chapter 1467, as applicable to those benefits under Section
1275.004.
Sec. 1683.006. RISK TRANSFER OR COVERAGE. A postsecondary
educational institution that offers higher education health
benefits under this chapter may contract with a company authorized
to engage in the business of insurance in this state that is not
under common control with the postsecondary educational
institution to:
(1) transfer to that company all or a portion of the
organization's risks arising from higher education health benefits
offered under this chapter; or
(2) obtain insurance coverage from the company
guarantying the postsecondary educational institution's
obligations arising from higher education health benefits offered
under this chapter.
Sec. 1683.007. ACTUARIAL SOUNDNESS. (a) A postsecondary
educational institution that offers higher education health
benefits under this chapter shall administer the benefits in a
manner that is actuarially sound.
(b) The postsecondary educational institution shall ensure
the higher education health benefits offered by the postsecondary
educational institution are actuarially sound by:
(1) obtaining an actuarial opinion from an actuary who
is a fellow of the Society of Actuaries or a member of the American
Academy of Actuaries that recommends the amount of cash reserves
and the level of specific and aggregate stop-loss insurance the
postsecondary educational institution should maintain for purposes
of administering the benefits; and
(2) maintaining the levels of cash reserves and
stop-loss insurance recommended by the actuarial opinion obtained
under Subdivision (1).
SECTION 3. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.