BILL ANALYSIS Senate Research Center S.B. 636 89R3644 MEW-D By: Johnson Health & Human Services 3/31/2025 As Filed AUTHOR'S / SPONSOR'S STATEMENT OF INTENT Significant legislative efforts have been made to increase access to mental health and substance use disorder care by improving insurance coverage. H.B. 10, enacted during the 85th regular legislative session, requires health plans regulated by the Texas Department of Insurance (TDI) to offer benefits in compliance with parity, meaning that the health plan's treatment limitations for mental health and substance use disorders must be comparable to and applied no more stringently than the treatment limitations for medical-surgical conditions. Additionally, since 2003, these same TDI-regulated plans have been required to provide coverage for serious mental illness, including 45 days of inpatient treatment and 60 visits for outpatient treatment. According to TDI, approximately 15 percent of Texans are covered by TDI-regulated plans. Further improvements are needed to ensure that health plans follow the parity framework and provide coverage for serious mental illness. Existing state parity and serious mental illness coverage requirements do not apply to laws that regulate insurance for state employees, retired teachers, public school employees, and University of Texas and Texas A&M University employees. These gaps have caused many public servants to receive inadequate health insurance coverage. S.B. 636 would require health insurance plans for public servants to comply with the federal parity framework and to provide coverage for serious mental illness. Aligning the Teacher Retirement System (TRS) and Employees Retirement System (ERS) health benefit plans with the parity frameworks employed by other employers not only bolsters the compensation packages offered by the state, but also establishes access to quality mental health and substance use services for TRS and ERS members. As proposed, S.B. 636 amends current law relating to coverage for mental health conditions and substance use disorders under certain governmental health benefit plans. RULEMAKING AUTHORITY This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 1355.002(b), Insurance Code, as follows: (b) Provides that, except as otherwise provided by Subchapter A (Group Health Benefit Plan Coverage), but notwithstanding any other law, this subchapter applies to: (1) a basic coverage plan under Chapter 1551 (Texas Employees Group Benefits Act); (2) creates this subdivision from existing text and makes a nonsubstantive change; (3) redesignates existing Subdivision (2) as Subdivision (3) and makes no further changes; and (4) a plan providing basic coverage under Chapter 1601 (Uniform Insurance Benefits Act for Employees of the University of Texas System and the Texas A&M University System). Deletes existing text providing that, notwithstanding any provision in Chapter 1575 (Texas Public School Employees Group Benefits Program) or 1579 (Texas School Employees Uniform Group Health Coverage) or any other law, Section 1355.015 (Required Coverage for Certain Enrollees) applies to certain plans. SECTION 2. Amends Section 1355.003(a), Insurance Code, as follows: (a) Deletes existing text providing that this subchapter, except as provided by Subsection (b) (relating to defining "serious mental illness"), does not apply to coverage under a plan offered under Chapter 1551 or Chapter 1601. Makes nonsubstantive changes. SECTION 3. Amends Section 1355.015(e), Insurance Code, as follows: (e) Provides that, notwithstanding any other law, this section does not apply to: (1) creates this subdivision from existing text and makes no further changes; (2) a basic coverage plan under Chapter 1551; or (3) a plan providing basic coverage under Chapter 1601. SECTION 4. Amends Section 1355.252, Insurance Code, by adding Subsection (d), as follows: (d) Provides that, notwithstanding any other law, this subchapter applies to a basic coverage plan under Chapter 1551, a basic plan under Chapter 1575, a primary care coverage plan under Chapter 1579, and a plan providing basic coverage under Chapter 1601. SECTION 5. Amends Section 1355.255, Insurance Code, as follows: Sec. 1355.255. COMPLIANCE. (a) Creates this subsection from existing text. Creates an exception under Subsection (b). (b) Requires the applicable trustee, board of trustees, or system, with respect to a plan described by Section 1355.252(d), to enforce compliance with Section 1355.254 (Coverage for Mental Health Conditions and Substance Use Disorders) by evaluating the benefits and coverage offered by a health benefit plan for quantitative and nonquantitative treatment limitations in the following categories: (1) in-network and out-of-network inpatient care; (2) in-network and out-of-network outpatient care; (3) emergency care; and (4) prescription drugs. SECTION 6. Repealer: Section 1355.003(b) (relating to defining "serious mental illness"), Insurance Code. SECTION 7. Makes application of this Act prospective to January 1, 2026. SECTION 8. Effective date: September 1, 2025.
BILL ANALYSIS
Senate Research Center S.B. 636
89R3644 MEW-D By: Johnson
Health & Human Services
3/31/2025
As Filed
Senate Research Center
S.B. 636
89R3644 MEW-D
By: Johnson
Health & Human Services
3/31/2025
As Filed
AUTHOR'S / SPONSOR'S STATEMENT OF INTENT
Significant legislative efforts have been made to increase access to mental health and substance use disorder care by improving insurance coverage. H.B. 10, enacted during the 85th regular legislative session, requires health plans regulated by the Texas Department of Insurance (TDI) to offer benefits in compliance with parity, meaning that the health plan's treatment limitations for mental health and substance use disorders must be comparable to and applied no more stringently than the treatment limitations for medical-surgical conditions.
Additionally, since 2003, these same TDI-regulated plans have been required to provide coverage for serious mental illness, including 45 days of inpatient treatment and 60 visits for outpatient treatment. According to TDI, approximately 15 percent of Texans are covered by TDI-regulated plans. Further improvements are needed to ensure that health plans follow the parity framework and provide coverage for serious mental illness.
Existing state parity and serious mental illness coverage requirements do not apply to laws that regulate insurance for state employees, retired teachers, public school employees, and University of Texas and Texas A&M University employees. These gaps have caused many public servants to receive inadequate health insurance coverage.
S.B. 636 would require health insurance plans for public servants to comply with the federal parity framework and to provide coverage for serious mental illness. Aligning the Teacher Retirement System (TRS) and Employees Retirement System (ERS) health benefit plans with the parity frameworks employed by other employers not only bolsters the compensation packages offered by the state, but also establishes access to quality mental health and substance use services for TRS and ERS members.
As proposed, S.B. 636 amends current law relating to coverage for mental health conditions and substance use disorders under certain governmental health benefit plans.
RULEMAKING AUTHORITY
This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 1355.002(b), Insurance Code, as follows:
(b) Provides that, except as otherwise provided by Subchapter A (Group Health Benefit Plan Coverage), but notwithstanding any other law, this subchapter applies to:
(1) a basic coverage plan under Chapter 1551 (Texas Employees Group Benefits Act);
(2) creates this subdivision from existing text and makes a nonsubstantive change;
(3) redesignates existing Subdivision (2) as Subdivision (3) and makes no further changes; and
(4) a plan providing basic coverage under Chapter 1601 (Uniform Insurance Benefits Act for Employees of the University of Texas System and the Texas A&M University System).
Deletes existing text providing that, notwithstanding any provision in Chapter 1575 (Texas Public School Employees Group Benefits Program) or 1579 (Texas School Employees Uniform Group Health Coverage) or any other law, Section 1355.015 (Required Coverage for Certain Enrollees) applies to certain plans.
SECTION 2. Amends Section 1355.003(a), Insurance Code, as follows:
(a) Deletes existing text providing that this subchapter, except as provided by Subsection (b) (relating to defining "serious mental illness"), does not apply to coverage under a plan offered under Chapter 1551 or Chapter 1601. Makes nonsubstantive changes.
SECTION 3. Amends Section 1355.015(e), Insurance Code, as follows:
(e) Provides that, notwithstanding any other law, this section does not apply to:
(1) creates this subdivision from existing text and makes no further changes;
(2) a basic coverage plan under Chapter 1551; or
(3) a plan providing basic coverage under Chapter 1601.
SECTION 4. Amends Section 1355.252, Insurance Code, by adding Subsection (d), as follows:
(d) Provides that, notwithstanding any other law, this subchapter applies to a basic coverage plan under Chapter 1551, a basic plan under Chapter 1575, a primary care coverage plan under Chapter 1579, and a plan providing basic coverage under Chapter 1601.
SECTION 5. Amends Section 1355.255, Insurance Code, as follows:
Sec. 1355.255. COMPLIANCE. (a) Creates this subsection from existing text. Creates an exception under Subsection (b).
(b) Requires the applicable trustee, board of trustees, or system, with respect to a plan described by Section 1355.252(d), to enforce compliance with Section 1355.254 (Coverage for Mental Health Conditions and Substance Use Disorders) by evaluating the benefits and coverage offered by a health benefit plan for quantitative and nonquantitative treatment limitations in the following categories:
(1) in-network and out-of-network inpatient care;
(2) in-network and out-of-network outpatient care;
(3) emergency care; and
(4) prescription drugs.
SECTION 6. Repealer: Section 1355.003(b) (relating to defining "serious mental illness"), Insurance Code.
SECTION 7. Makes application of this Act prospective to January 1, 2026.
SECTION 8. Effective date: September 1, 2025.