By: Parker S.B. No. 1065
A BILL TO BE ENTITLED
AN ACT
1-1 relating to health insurance and health costs and the availability
1-2 of health insurance coverage for certain individuals and small
1-3 employers.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. The Insurance Code is amended by adding Chapter
1-6 26 to read as follows:
1-7 CHAPTER 26. HEALTH INSURANCE AVAILABILITY
1-8 SUBCHAPTER A. GENERAL PROVISIONS
1-9 Art. 26.01. SHORT TITLE. This chapter may be cited as the
1-10 Small Employer Health Insurance Availability Act.
1-11 Art. 26.02. DEFINITIONS. In this chapter:
1-12 (1) "Affiliated employer" means a person or entity
1-13 connected by commonality of ownership with a small employer. The
1-14 term includes, without limitation, an entity that owns a small
1-15 employer, shares directors with a small employer, or is eligible to
1-16 file a consolidated tax return with a small employer.
1-17 (2) "Agent" means a person who may act as an agent for
1-18 the sale of a health benefit plan under a license issued under
1-19 Article 20A.15 or Article 20A.15A, or under Subchapter A, Chapter
1-20 21, of this code.
1-21 (3) "Base premium rate" means, for each class of
1-22 business as to a rating period, the lowest premium rate charged or
1-23 that could have been charged under a rating system for that class
2-1 of business by the health carrier to small employers with similar
2-2 case characteristics for small employer health benefit plans with
2-3 the same or similar coverage.
2-4 (4) "Board" means the State Board of Insurance.
2-5 (5) "Board of directors" means the board of directors
2-6 of the Texas Health Reinsurance System.
2-7 (6) "Case characteristics" means, with respect to a
2-8 small employer, the geographic area in which the employees reside;
2-9 the age and gender of the individual employees and their
2-10 dependents; the appropriate industry classification as determined
2-11 by the health carrier; and the number of employees and dependents
2-12 and such other objective criteria as may be established by the
2-13 health carrier. The term does not include claims experience,
2-14 health status, duration of coverage since the date of issuance, or
2-15 whether a covered person is or may become pregnant.
2-16 (7) "Class of business" means all or a separate
2-17 grouping of small employers established pursuant to this Act.
2-18 (8) "Commissioner" means the Commissioner of the Texas
2-19 Department of Insurance.
2-20 (9) "Dependent" means:
2-21 (A) a covered individual's spouse;
2-22 (B) a covered individual's newborn child;
2-23 (C) a covered individual's child under the age
2-24 of 19 years;
2-25 (D) a covered individual's child who is a
3-1 full-time student under the age of 22 years and who is financially
3-2 dependent upon the parent;
3-3 (E) a covered individual's child of any age who
3-4 is medically certified as disabled and dependent upon the parent;
3-5 and
3-6 (F) any person who must be covered under Section
3-7 3D or 3E, Article 3.51-6, or under Article 3.70-2(L), of this code.
3-8 (10) "Eligible employee" means an employee who works
3-9 on a full-time basis and has a normal work week of 30 hours or
3-10 more. The term includes a sole proprietor, a partner, and an
3-11 independent contractor, if the sole proprietor, partner, or
3-12 independent contractor is included as an employee under a health
3-13 benefit plan of a small employer. The term does not include an
3-14 employee who works on a part-time, temporary, or substitute basis.
3-15 (11) "Health benefit plan" means a group, blanket, or
3-16 franchise insurance policy, a certificate issued under a group
3-17 policy, a group hospital service contract, a group subscriber
3-18 contract, or evidence of coverage issued by a health maintenance
3-19 organization that provides benefits for health care services. The
3-20 term does not include:
3-21 (A) accident-only insurance coverage;
3-22 (B) credit insurance coverage;
3-23 (C) disability insurance coverage;
3-24 (D) specified disease coverage;
3-25 (E) coverage of Medicare services under a
4-1 federal contract;
4-2 (F) Medicare supplement and Medicare Select
4-3 policies which are regulated in accordance with federal law;
4-4 (G) long-term care insurance coverage;
4-5 (H) coverage limited to dental care;
4-6 (I) coverage limited to care of vision;
4-7 (J) insurance coverage issued as a supplement to
4-8 liability insurance;
4-9 (K) insurance coverage arising out of a workers'
4-10 compensation system or similar statutory system;
4-11 (L) automobile medical payment insurance
4-12 coverage; or
4-13 (M) Taft-Hartley Trusts, which are jointly
4-14 managed trusts, as allowed by 29 U.S.C. Section 141 et. seq.,
4-15 containing a plan of benefits for employees which is negotiated in
4-16 a collective bargaining agreement governing wages, hours, and
4-17 working conditions of the employees, as allowed by 29 U.S.C.
4-18 Section 157.
4-19 (12) "Health carrier" means any entity authorized
4-20 under this code that provides health insurance or health benefits
4-21 in this state, including an insurance company, a group hospital
4-22 service corporation authorized under Chapter 20, a health
4-23 maintenance organization authorized under Chapter 20A, and a
4-24 stipulated premium company authorized under Chapter 22 of this
4-25 code.
5-1 (13) "Index rate" means, for each class of business as
5-2 to a rating period for small employers with similar case
5-3 characteristics, the arithmetic average of the applicable base
5-4 premium rate and corresponding highest premium rate.
5-5 (14) "Late enrollee" means an eligible employee or
5-6 dependent who requests enrollment in a small employer's health
5-7 benefit plan following the initial enrollment period provided under
5-8 the terms of the first plan for which such employee or dependent
5-9 was eligible through such small employer, provided an eligible
5-10 employee or dependent shall not be considered a late enrollee if:
5-11 (A) the individual:
5-12 (1) was covered under another
5-13 employer-provided health benefit plan at the time the individual
5-14 was eligible to enroll;
5-15 (2) states, at the time of the initial
5-16 eligibility, that coverage under another employer health benefit
5-17 plan was the reason for declining enrollment;
5-18 (3) has lost coverage under another
5-19 employer health benefit plan as a result of the termination of
5-20 employment, the termination of the other plan's coverage, death of
5-21 a spouse, or divorce; and
5-22 (4) requests enrollment within thirty-one
5-23 days after the termination of coverage under another employer
5-24 health benefit plan, or
5-25 (B) the individual is employed by an employer
6-1 who offers multiple health benefit plans and the individual elects
6-2 a different health benefit plan during an open enrollment period,
6-3 or
6-4 (C) a court has ordered coverage to be provided
6-5 for a spouse or minor child under a covered employee's plan and
6-6 request for enrollment is made within thirty-one days after
6-7 issuance of such court order.
6-8 (15) "New business premium rate" means, for each class
6-9 of business as to a rating period, the lowest premium rate charged
6-10 or offered or which could have been charged or offered by the
6-11 health carrier to small employers with similar case characteristics
6-12 for newly issued small employer health benefit plans with the same
6-13 or similar coverage.
6-14 (16) "Person" means an individual, corporation,
6-15 partnership, association, or any other private legal entity.
6-16 (17) "Plan of operation" means the plan of operation
6-17 of the system established under Article 26.55 of this code.
6-18 (18) "Premium" means all moneys paid by a small
6-19 employer and eligible employees as a condition of receiving
6-20 coverage from a health carrier, including any fees or other
6-21 contributions associated with a health benefit plan.
6-22 (19) "Rating period" means the calendar period for
6-23 which premium rates established by a health carrier are assumed to
6-24 be in effect.
6-25 (20) "Reinsuring carrier" means a health carrier
7-1 participating in the system.
7-2 (21) "Risk-assuming carrier" means a health carrier
7-3 that elects not to participate in the system.
7-4 (22) "Small employer" means a person actively engaged
7-5 in business and that, on at least 50 percent of its working days
7-6 during the preceding calendar quarter, employed at least 3 and not
7-7 more than 50 eligible employees, the majority of whom were employed
7-8 in this state, including the employees of an affiliated employer,
7-9 if any.
7-10 (23) "Small employer health benefit plans" means the
7-11 Primary and Preventive Care Benefit Plan, the In-Hospital Benefit
7-12 Plan, and the Standard Health Benefit Plan described in Subchapter
7-13 E of this chapter.
7-14 (24) "System" means the Texas Health Reinsurance
7-15 System established under Subchapter F of this chapter.
7-16 Art. 26.03. AFFILIATED CARRIERS. (a) For purposes of this
7-17 chapter, health carriers that are affiliates or that are eligible
7-18 to file a consolidated tax return are considered to be one carrier,
7-19 and a restriction imposed by this chapter applies as if the health
7-20 benefit plans delivered or issued for delivery to small employers
7-21 in this state by the affiliates were issued by one carrier.
7-22 (b) An affiliate that is a health maintenance organization
7-23 is considered to be a separate health carrier for the purposes of
7-24 this chapter.
7-25 (c) In this article, "affiliate" has the meaning assigned by
8-1 Article 21.49-1 of this code.
8-2 Art. 26.04. RULES. The board shall adopt rules to implement
8-3 this chapter.
8-4 Art. 26.05. STATUTORY REFERENCES. A reference in this
8-5 chapter to a statutory provision applies to all reenactments,
8-6 revisions, or amendments of that statutory provision.
8-7 Article 26.06. APPLICABILITY. (a) Any individual or group
8-8 health benefit plan shall be subject to the provisions of this
8-9 chapter if it provides health care benefits covering three or more
8-10 eligible employees of a small employer and if it meets any one of
8-11 the following conditions:
8-12 (1) Any portion of the premium or benefits is paid by
8-13 a small employer, or
8-14 (2) Any covered individual is reimbursed, whether
8-15 through wage adjustments or otherwise, by a small employer for any
8-16 portion of the premium, or
8-17 (3) The health benefit plan is treated by the employer
8-18 or any of the covered individuals as part of a plan or program for
8-19 the purposes of Section 162 or Section 106 of the United State
8-20 Internal Revenue Code.
8-21 (b) This chapter applies to a list-billed individual health
8-22 insurance policy. This article does not apply to an individual
8-23 health insurance policy that is underwritten individually.
8-24 (c) Except as expressly provided in this Act, no small
8-25 employer health benefit plan offered to a small employer shall be
9-1 subject to:
9-2 (1) Any law requiring coverage or the offer of
9-3 coverage of a health care service or benefit;
9-4 (2) Any law that would prevent any health carrier from
9-5 contracting with providers or groups of providers with respect to
9-6 health care services or benefits; or
9-7 (3) Any law that would prevent negotiations with
9-8 providers regarding the level or method of reimbursing care of
9-9 services provided under the health benefit plan.
9-10 SUBCHAPTER B. PURCHASING COOPERATIVES
9-11 Art. 26.11. DEFINITIONS. In this subchapter:
9-12 (1) "Board of trustees" means the board of trustees of
9-13 the Texas cooperative.
9-14 (2) "Board" means the board of directors elected by a
9-15 private purchasing cooperative.
9-16 (3) "Cooperative" means a purchasing cooperative
9-17 established under this subchapter.
9-18 (4) "Texas cooperative" means the Texas Health
9-19 Benefits Purchasing Cooperative established under Art. 26.12 of
9-20 this subchapter.
9-21 Art. 26.12. TEXAS HEALTH BENEFITS PURCHASING COOPERATIVE.
9-22 (a) The Texas Health Benefits Purchasing Cooperative is a
9-23 nonprofit organization established to make health care coverage
9-24 available to small employers, their eligible employees, and their
9-25 eligible employees' dependents.
10-1 (b) The Texas cooperative is administered by a six-member
10-2 board of trustees appointed by the governor with the advice and
10-3 consent of the senate. Two members must represent employers, two
10-4 members must represent employees, and two members must represent
10-5 the public. The chair of the State Board of Insurance and the
10-6 executive director of the Texas Department of Commerce shall serve
10-7 as ex officio trustees.
10-8 (c) The appointed members of the board of trustees serve
10-9 staggered six-year terms, with the terms of two of the members
10-10 expiring February 1 of each odd-numbered year.
10-11 (d) A member of the board of trustees may not be compensated
10-12 for serving on the board of trustees but is entitled to
10-13 reimbursement for actual expenses incurred in performing functions
10-14 as a member of the board of trustees as provided in the General
10-15 Appropriations Act.
10-16 (e) The board of trustees shall employ an executive
10-17 director. The executive director may hire other employees as
10-18 necessary.
10-19 (f) The board of trustees may develop regional subdivisions
10-20 of the Texas cooperative, and authorize each subdivision to
10-21 separately exercise the powers and duties of a cooperative.
10-22 (g) Employee salaries and related costs may be paid from
10-23 administrative fees collected from employers and carriers or other
10-24 sources of funding arranged by the Texas cooperative.
10-25 (h) A member of the board of trustees, the executive
11-1 director, and any employee or agent of the Texas cooperative is not
11-2 liable for any act performed in good faith in the execution of
11-3 duties in connection with the Texas cooperative.
11-4 Art. 26.13. PRIVATE PURCHASING COOPERATIVE. (a) One or
11-5 more small employers may form a cooperative for the group purchase
11-6 of small employer health benefit plans. A cooperative shall be
11-7 organized as a non-profit corporation and has the rights and duties
11-8 provided by the Texas Non-Profit Corporation Act.
11-9 (b) The board shall annually file with the commissioner a
11-10 statement of all moneys collected and expenses incurred for each of
11-11 the past three years.
11-12 Art. 26.14. POWERS AND DUTIES OF COOPERATIVES. (a) A
11-13 cooperative may:
11-14 (1) arrange for small employer health benefit plans
11-15 coverage for small employer groups who participate in the
11-16 cooperative by contracting with one or more health carriers;
11-17 (2) collect moneys to cover the cost of:
11-18 (A) premiums for small employer health benefit
11-19 plans coverage purchased through the cooperative, and
11-20 (B) the cooperative's administrative expenses;
11-21 (3) contract with agents to market coverage issued
11-22 through the cooperative;
11-23 (4) establish administrative and accounting procedures
11-24 for the operation of the cooperative;
11-25 (5) establish criteria governing the eligibility of
12-1 carriers or health care providers to participate in the program;
12-2 (6) establish procedures under which an applicant for
12-3 or participant in coverage issued through the cooperative may have
12-4 a grievance reviewed by an impartial person;
12-5 (7) contract with a carrier or third-party
12-6 administrator to provide administrative services to the
12-7 cooperative;
12-8 (8) contract with a health carrier or health care
12-9 provider for the provision of services to small employers covered
12-10 through the cooperative;
12-11 (9) develop and implement a plan to maintain public
12-12 awareness of the cooperative and publicize the eligibility
12-13 requirements for, and the procedures for enrollment in coverage
12-14 through, the cooperative; and
12-15 (10) negotiate premiums paid by its members.
12-16 (b) A cooperative may not self insure or self fund any
12-17 health benefit plan or portion thereof.
12-18 Art. 26.15. COOPERATIVE NOT AN INSURER. (a) A cooperative
12-19 is not an insurer and the employees of the cooperative are not
12-20 required to be licensed under Subchapter A, Chapter 21, of this
12-21 code.
12-22 (b) An agent or third-party administrator used and
12-23 compensated by the cooperative must be licensed as required by
12-24 Subchapter A, Chapter 21, of this code.
12-25 SUBCHAPTER C. GUARANTEED ISSUE AND RENEWABILITY
13-1 Art. 26.21. SMALL EMPLOYER HEALTH BENEFIT PLANS; EMPLOYER
13-2 ELECTION. (a) Until December 31, 1996, each health carrier
13-3 marketing to small employers shall provide the small employer
13-4 health benefit plans without regard to claims experience, health
13-5 status, or medical history. Each health carrier shall issue the
13-6 plan chosen by the small employer to each small employer that
13-7 elects to be covered under that plan, agrees to make the required
13-8 premium payments, and agrees to satisfy the other requirements of
13-9 the plan. After December 31, 1996, a small employer that desires
13-10 coverage for its employees through the purchase of a small employer
13-11 health benefit plan is subject to normal underwriting requirements.
13-12 (b) An employer that becomes a small employer after December
13-13 31, 1996, has one year in which to purchase coverage for its
13-14 employees through the small employer health benefit plans without
13-15 regard to claims experience, health status, or medical history.
13-16 After that time, the small employer is subject to normal
13-17 underwriting requirements.
13-18 (c) Coverage under a small employer health benefit plan is
13-19 not available unless a small employer pays 100 percent of the
13-20 insurance premium for all of its eligible employees for, at the
13-21 small employer's election, one of the small employer health benefit
13-22 plans. The small employer may also elect to pay the premium cost
13-23 for additional coverage.
13-24 (d) An eligible employee may obtain additional coverage
13-25 beyond that purchased by the employer if at least 20 percent of the
14-1 eligible employees elect to obtain the same additional coverage.
14-2 Such additional coverage may be paid for by the employer, the
14-3 employee, or both.
14-4 (e) The initial enrollment period for the employees and
14-5 their dependents shall be at least 30 days.
14-6 (f) A new employee of a covered small employer and the
14-7 dependents of that employee shall not be denied coverage if the
14-8 application is received by the health carrier not later than the
14-9 31st day after the date on which the employment begins.
14-10 (g) A late enrollee may be excluded from coverage for 12
14-11 months from the date of application or may be subject to a 12-month
14-12 preexisting condition exclusion. If both a period of exclusion
14-13 from coverage and a preexisting condition exclusion are applicable
14-14 to a late enrollee, the combined period of exclusion may not exceed
14-15 12 months from the date of the late application.
14-16 (h) A health carrier shall not exclude any eligible employee
14-17 or dependent who would otherwise be covered under a small employer
14-18 health benefit plan on the basis of an actual or expected health
14-19 condition of such person.
14-20 (i) No small employer health benefit plan issued by a health
14-21 carrier may limit or exclude, by use of a rider or amendment
14-22 applicable to a specific individual, coverage by type of illness,
14-23 treatment, medical condition, or accident, except for pre-existing
14-24 conditions or diseases as permitted under Article 26.47 of this
14-25 Act.
15-1 (j) A small employer plan may not limit or exclude initial
15-2 coverage of a newborn child of the employee. Any coverage of a
15-3 newborn child of an employee under this subsection terminates on
15-4 the 30th day after the birth date of the child unless:
15-5 (1) dependent children are eligible for coverage, and
15-6 (2) notification of the birth and any required
15-7 additional premium is received by the insurer not later than the
15-8 31st day after the date of birth.
15-9 (k) If the Consolidated Omnibus Budget Reconciliation Act of
15-10 1985, as amended (Pub.L. No. 99-272, 100 Stat. 222), does not
15-11 require continuation or conversion coverage for dependents of an
15-12 employee, a dependent who has been covered by that small employer
15-13 for at least one year or is an infant under one year of age may
15-14 elect to continue coverage with the small employer, as long as the
15-15 small employer plan is in force, if the dependent loses eligibility
15-16 for coverage because of the death, divorce, or retirement of the
15-17 employee, as required by Art. 3.51-3B of this code.
15-18 Art. 26.22. GEOGRAPHIC SERVICE AREA. (a) A health carrier
15-19 is not required to issue the small employer health benefit plans to
15-20 a small employer if a plan would cover an employer who is:
15-21 (1) not located within a geographic service area filed
15-22 with the commissioner for that health carrier. The commissioner
15-23 shall have the authority to disapprove a geographic service area;
15-24 or
15-25 (2) located in an area in which the commissioner
16-1 determines that the health carrier will not have the capacity to
16-2 deliver services adequately because of obligations to existing
16-3 covered individuals.
16-4 (b) A health carrier that refuses to issue a small employer
16-5 health benefit plan in a geographic service area filed with the
16-6 commissioner may not offer a health benefit plan to a group of less
16-7 than 50 individuals in the affected geographic service area before
16-8 the fifth anniversary of the date of the refusal.
16-9 Art. 26.23. RENEWABILITY OF COVERAGE; CANCELLATION.
16-10 (a) Except as provided by Article 26.24 of this code, a health
16-11 carrier shall renew the small employer health benefit plans for all
16-12 covered small employers at the option of the small employer, except
16-13 for:
16-14 (1) nonpayment of a premium;
16-15 (2) fraud or misrepresentation of a material fact by
16-16 the small employer; or
16-17 (3) noncompliance with small employer health benefit
16-18 plan provisions.
16-19 (b) A health carrier may not cancel the small employer
16-20 health benefit plans except for the reasons specified for refusal
16-21 to renew under Subsection (a) of this article.
16-22 Art. 26.24. REFUSAL TO RENEW ALL PLANS. (a) A health
16-23 carrier may elect to refuse to renew all small employer health
16-24 benefit plans delivered or issued for delivery by the carrier in
16-25 this state or in a geographic service area approved under Article
17-1 26.22 of this code. The health carrier must notify the
17-2 commissioner of the election not later than the 180th day before
17-3 the date coverage under the first small employer health benefit
17-4 plan terminates under this subsection.
17-5 (b) The health carrier must notify each affected covered
17-6 small employer not later than the 180th day before the date on
17-7 which coverage terminates for that small employer.
17-8 (c) A health carrier that elects under Subsection (a) of
17-9 this article to refuse to renew all small employer health benefit
17-10 plans in this state or in an approved geographic service area may
17-11 not write a new small employer health benefit plan in this state or
17-12 in the geographic service area, as applicable, before the fifth
17-13 anniversary of the date of notice to the commissioner under
17-14 Subsection (a) of this article.
17-15 (d) A health carrier that elects under Subsection (a) of
17-16 this article to refuse to renew all small employer health benefit
17-17 plans in this state is subject to Article 21.49-2c of this code.
17-18 SUBCHAPTER D. UNDERWRITING AND RATING
17-19 Art. 26.31. ESTABLISHMENT OF CLASSES OF BUSINESS. (a) A
17-20 health carrier may establish a separate class of business only to
17-21 reflect substantial differences in expected claims experience or
17-22 administrative costs related to the following reasons:
17-23 (1) The health carrier uses more than one type of
17-24 system for the marketing and sale of small employer health benefit
17-25 plans to small employers; or
18-1 (2) The health carrier has acquired a class of
18-2 business from another health carrier.
18-3 (b) A health carrier may establish up to nine (9) separate
18-4 classes of business under this article.
18-5 (c) The commissioner may establish regulations to provide
18-6 for a period of transition in order for a health carrier to come
18-7 into compliance with Subsection (b) in the instance of acquisition
18-8 of an additional class of business from another health carrier.
18-9 (d) The commissioner may approve the establishment of
18-10 additional classes of business upon application to the commissioner
18-11 and a finding by the commissioner that such action would enhance
18-12 the efficiency and fairness of the small employer marketplace.
18-13 Art. 26.32. INDEX RATES. Premium rates for small employer
18-14 health benefit plans subject to this Act shall be subject to the
18-15 following provisions:
18-16 (1) The index rate for a rating period for any class
18-17 of business shall not exceed the index rate for any other class of
18-18 business by more than 20 percent.
18-19 (2) For a class of business, the premium rates charged
18-20 during a rating period to small employers with similar case
18-21 characteristics for the same or similar coverage, or the rates that
18-22 could be charged to such employers under the rating system for that
18-23 class of business, shall not vary from the index rate by more than
18-24 25 percent of the index rate.
18-25 Art. 26.33. PREMIUM RATES; ADJUSTMENTS. (a) The percentage
19-1 increase in the premium rate charged to a small employer for a new
19-2 rating period may not exceed the sum of the following:
19-3 (1) The percentage change in the new business premium
19-4 rate measured from the first day of the prior rating period to the
19-5 first day of the new rating period. In the case of a small
19-6 employer health benefit plan into which the health carrier is no
19-7 longer enrolling new small employers, the health carrier shall use
19-8 the percentage change in the base premium rate, provided that such
19-9 change does not exceed, on a percentage basis, the change in the
19-10 new business premium rate for the most similar health benefit plan
19-11 into which the health carrier is actively enrolling new small
19-12 employers;
19-13 (2) Any adjustment, not to exceed 15 percent annually
19-14 and adjusted pro rata for rating periods of less than one year, due
19-15 to the claim experience, health status or duration of coverage of
19-16 the employees or dependents of the small employer as determined
19-17 from the health carrier's rate manual for the class of business;
19-18 and
19-19 (3) Any adjustment due to change in coverage or change
19-20 in the case characteristics of the small employer as determined
19-21 from the health carrier's rate manual for the class of business.
19-22 (b) Adjustments in rates for claim experience, health status
19-23 and duration of coverage shall not be charged to individual
19-24 employees or dependents. Any such adjustment shall be applied
19-25 uniformly to the rates charged for all employees and dependents of
20-1 the small employer.
20-2 (c) A health carrier may utilize industry as a case
20-3 characteristic in establishing premium rates, provided that the
20-4 highest rate factor associated with any industry classification
20-5 shall not exceed the lowest rate factor associated with any
20-6 industry classification by more than 15 percent.
20-7 Art. 26.34. PRIOR COVERAGE. In the case of health benefit
20-8 plans delivered or issued for delivery prior to the effective date
20-9 of this Act, a premium rate for a rating period may exceed the
20-10 ranges set forth in for a period of two years following the
20-11 effective date of this Act. In such cases, the percentage increase
20-12 in the premium rate charged to a small employer for a new rating
20-13 period shall not exceed the sum of the following:
20-14 (1) The percentage change in the new business premium
20-15 rate measured from the first day of the prior rating period to the
20-16 first day of the new rating period. In the case of a health
20-17 benefit plan into which the small employer carrier is no longer
20-18 enrolling new small employers, the health carrier shall use the
20-19 percentage change in the base premium rate, provided that such
20-20 change does not exceed, on a percentage basis, the change in the
20-21 new business premium rate for the most similar health benefit plan
20-22 into which the health carrier is actively enrolling new small
20-23 employers; and
20-24 (2) Any adjustment due to change in coverage or change
20-25 in the base characteristics of the small employer as determined
21-1 from the health carrier's rate manual for the class of business.
21-2 Art. 26.35. PREMIUM RATES; NONDISCRIMINATION. (a) Health
21-3 carriers shall apply rating factors, including case
21-4 characteristics, consistently with respect to all small employers
21-5 in a class of business. Rating factors shall produce premiums for
21-6 identical groups which differ only by the amounts attributable to
21-7 plan design and do not reflect differences due to the nature of the
21-8 groups assumed to select particular health benefit plans.
21-9 (b) A health carrier shall treat all health benefit plans
21-10 issued or renewed in the same calendar month as having the same
21-11 rating period.
21-12 (c) A health carrier shall not use case characteristics
21-13 other than age, gender, industry, geographic area, and group size
21-14 without the prior approval of the commissioner.
21-15 (d) Premium rates for small employer health benefit plans
21-16 shall comply with the requirements of this Act notwithstanding any
21-17 assessments paid or payable by health carriers.
21-18 (e) The commissioner may establish regulations to implement
21-19 the provisions of this section and to assure that rating practices
21-20 used by health carriers are consistent with the purposes of this
21-21 act, including regulations that:
21-22 (1) Assure that differences in rates charged for small
21-23 employer health benefit plans are reasonable and reflect objective
21-24 differences in plan design; and
21-25 (2) Prescribe the manner in which case characteristics
22-1 may be used by health carriers.
22-2 (f) A health carrier shall not transfer a small employer
22-3 involuntarily into or out of a class of business. A health carrier
22-4 shall not offer to transfer a small employer into or out of a class
22-5 of business unless such offer is made to transfer all small
22-6 employers in the class of business without regard to case
22-7 characteristics, claim experience, health status or duration of
22-8 coverage since issue.
22-9 Art. 26.36. RESTRICTED PROVIDER NETWORKS. For the purposes
22-10 of this subchapter, a small employee health benefit plan that
22-11 utilizes a restricted provider network shall not be considered
22-12 similar coverage to a small employer health benefit plan that does
22-13 not utilize such a network, provided that utilization of the
22-14 restricted provider network results in substantial differences in
22-15 claim costs.
22-16 Art. 26.37. ENFORCEMENT. If the commissioner finds that a
22-17 health carrier under this Chapter exceeds the applicable rate
22-18 established under this Subchapter, the commissioner may order
22-19 restitution and assess penalties as prescribed under Article 1.10,
22-20 Sec. 7, of this code.
22-21 Art. 26.38. DISCLOSURE. (a) In connection with the
22-22 offering for sale of any small employer health benefit plan, each
22-23 health carrier shall make a reasonable disclosure, as part of its
22-24 solicitation and sales materials, of:
22-25 (1) the extent to which premium rates for a specific
23-1 small employer are established or adjusted based upon the actual or
23-2 expected variation in claims costs or actual or expected variation
23-3 in health status of the employees of the small employer and their
23-4 dependents;
23-5 (2) the provisions concerning such health carrier's
23-6 right to change premium rates and the factors other than claims
23-7 experience which affect changes in premium rates;
23-8 (3) provisions relating to renewability of policies
23-9 and contracts; and
23-10 (4) provisions relating to any pre-existing condition
23-11 provision.
23-12 Art. 26.39. REPORTING REQUIREMENTS. (a) Compliance with
23-13 the underwriting and rating requirements contained in this Act
23-14 shall be demonstrated through actuarial certification. Health
23-15 carriers offering small employer health benefit plans shall file
23-16 annually with the Commissioner an actuarial certification stating
23-17 that the underwriting and rating methods of the health carrier:
23-18 (1) comply with accepted actuarial practices,
23-19 (2) are uniformly applied to small employer health
23-20 benefit plans covering small employers, and
23-21 (3) comply with the provisions of this Act.
23-22 (b) Each health carrier shall maintain at its principal
23-23 place of business a complete and detailed description of its rating
23-24 practices and renewal underwriting practices, including information
23-25 and documentation that demonstrate that its rating methods and
24-1 practices are based upon commonly accepted actuarial assumptions
24-2 and are in accordance with sound actuarial principles.
24-3 (c) A health carrier shall make the information and
24-4 documentation described in Subsection (b) of this article available
24-5 to the commissioner upon request. Except in cases of violations
24-6 of this Act, the information shall be considered proprietary and
24-7 trade secret information and shall not be subject to disclosure by
24-8 the commissioner to persons outside of the Department except as
24-9 agreed to by the health carrier or as ordered by a court of
24-10 competent jurisdiction.
24-11 SUBCHAPTER E. COVERAGE
24-12 Art. 26.41. SMALL EMPLOYER HEALTH BENEFIT PLANS. (a) A
24-13 health carrier marketing to small employers shall offer three
24-14 health benefit plans: the Preventive and Primary Care Benefit
24-15 Plan, the In-Hospital Benefit Plan and the Standard Health Benefit
24-16 Plan. These three plans will be collectively referred to as the
24-17 small employer health benefit plans.
24-18 (b) A health carrier may offer to a small employer
24-19 additional riders to the Standard Health Benefit Plan.
24-20 (c) A health carrier may not offer to a small employer
24-21 riders to the:
24-22 (1) Preventive and Primary Care Benefit Plan except as
24-23 provided by Art. 26.44(c);
24-24 (2) In-Hospital Benefit Plan, except as provided by
24-25 Art. 26.45(c).
25-1 Art. 26.42. POLICY FORMS. The commissioner shall promulgate
25-2 the policy forms for the small employer health benefit plans. A
25-3 health carrier may not offer these three benefit plans through
25-4 policy forms other than those promulgated by the commissioner under
25-5 this article.
25-6 Art. 26.43. RIDERS; FILING WITH COMMISSIONER. (a) A health
25-7 carrier shall file with the commissioner, in a form and manner
25-8 prescribed by the commissioner, riders to the small employer health
25-9 benefit plans as allowed under this subchapter to be used by the
25-10 carrier. A health carrier may use a rider filed under this article
25-11 after the 30th day after the date the rider is filed unless the
25-12 commissioner disapproves its use.
25-13 (b) The commissioner may, after notice and an opportunity
25-14 for a hearing, disapprove the continued use by a health carrier of
25-15 a rider if the rider does not meet the requirements of this
25-16 chapter.
25-17 Art. 26.44. PREVENTIVE AND PRIMARY CARE BENEFIT PLAN.
25-18 (a) The Preventive and Primary Care Benefit Plan must include
25-19 coverage for health services described in subsections (b) and (c)
25-20 of this Article when they are provided by a physician, physician
25-21 assistant, advanced nurse practitioner, or another licensed
25-22 practitioner, including any practitioner required to be covered
25-23 under Article 21.52 of this code or under Section 2, Chapter 397,
25-24 Acts of the 54th Legislature, Regular Session, 1955 (Article
25-25 3.70-2, Vernon's Texas Insurance Code).
26-1 (b) Coverage for the following preventive care must be
26-2 provided with no copayments or deductibles required:
26-3 (1) childhood immunizations;
26-4 (2) Pap tests;
26-5 (3) mammography, as required by Section 2, Chapter
26-6 397, Acts of the 54th Legislature, Regular Session, 1955 (Article
26-7 3.70-2, Vernon's Texas Insurance Code) and its subsequent
26-8 amendments;
26-9 (4) colo-rectal screening;
26-10 (5) prostate cancer screening;
26-11 (6) vision and hearing tests for children under 19
26-12 years of age;
26-13 (c) Coverage must include the following:
26-14 (1) outpatient hospital care and up to 5 days per
26-15 policy year of inpatient hospital care;
26-16 (2) medically necessary emergency care;
26-17 (3) pregnancy-related care, including prenatal and
26-18 postnatal care and high-risk pregnancy care;
26-19 (4) well-child care, including neonatal screening and
26-20 routine physical check-ups;
26-21 (5) outpatient clinic or office visits for treatment
26-22 of illness or injury;
26-23 (6) one physical examination per policy year;
26-24 (7) diagnostic examinations, laboratory, and x-ray
26-25 services, with a limit of $5,000 per policy year;
27-1 (8) mental health services, including outpatient
27-2 evaluation, crisis intervention, and services for treatment of
27-3 serious mental illness as defined in Sec. 1 of Art. 3.51-14 of this
27-4 code, for 5 days of inpatient services and 40 outpatient visits per
27-5 policy year;
27-6 (9) evaluation and treatment for the abuse of or
27-7 addiction to alcohol or drugs, for 5 days of inpatient services and
27-8 40 outpatient visits per policy year;
27-9 (10) home health services, as defined in Sec. 1 of
27-10 Art.3.70-3B of this code; and
27-11 (11) rehabilitative services, including outpatient
27-12 diagnostic services and 40 outpatient treatment visits per policy
27-13 year;
27-14 (c) The Preventive and Primary Care Benefit Plan may include
27-15 a rider for coverage of prescription drugs but shall not include
27-16 any additional riders.
27-17 (d) The Preventive and Primary Care Benefit Plan shall
27-18 include a total benefit cap of $30,000 per policy year.
27-19 (e) Except for services excluded from deductible and
27-20 copayment requirements in subsection (b) of this Article, a
27-21 Preventive and Primary Care Benefit Plan may require a deductible
27-22 of no more than $250 per policy year and shall pay at least 80
27-23 percent of covered charges after the deductible has been satisfied.
27-24 After an insured employee's copayments have reached $1000 in a
27-25 policy year, the plan must pay 100 percent of covered charges for
28-1 the remainder of that policy year.
28-2 Art. 26.45. IN-HOSPITAL BENEFIT PLAN. (a) The In-Hospital
28-3 Benefit Plan shall include coverage for diagnostic, treatment, and
28-4 rehabilitative services provided through inpatient hospital
28-5 services and shall include outpatient care which is necessary as a
28-6 follow-up to the in-hospital treatment for a period of 90 days
28-7 after discharge from the hospital.
28-8 (b) The In-Hospital Benefit Plan is not subject to any law
28-9 requiring the reimbursement, utilization, or consideration of a
28-10 specific category of a licensed or certified health care
28-11 practitioner.
28-12 (c) The In-Hospital Benefit Plan shall provide lifetime
28-13 benefits of $1,000,000 and a total benefit cap of $100,000 per
28-14 policy year. The plan may require deductible payments of no more
28-15 than $500 per policy year and shall pay at least 80 percent of
28-16 covered charges after the deductible has been satisfied. After an
28-17 insured employee's copayments have reached $1000 in a policy year,
28-18 the plan must pay 100 percent of covered charges for the remainder
28-19 of that policy year.
28-20 (d) The In-Hospital Benefit Plan may include a primary and
28-21 preventive care rider that includes all the provisions of Art.
28-22 26.44 except for Subsection (c)(1) of that article. The
28-23 In-Hospital Benefit Plan may also include a supplementary accident
28-24 benefit plan, but shall not include other riders or supplementary
28-25 benefit plans.
29-1 Art. 26.46. STANDARD HEALTH BENEFIT PLAN. (a) The standard
29-2 health benefit plan shall include coverage for:
29-3 (1) health care services, including consulting and
29-4 referral services, provided by a physician, a physician assistant,
29-5 an advanced nurse practitioner, or another licensed practitioner,
29-6 including any practitioner required to be covered under Article
29-7 21.52 of this code or under Section 2, Chapter 397, Acts of the
29-8 54th Legislature, Regular Session, 1955 (Article 3.70-2, Vernon's
29-9 Texas Insurance Code);
29-10 (2) inpatient and outpatient hospital care;
29-11 (3) medically necessary emergency care;
29-12 (4) pregnancy-related care, including prenatal and
29-13 postnatal care and high-risk pregnancy care;
29-14 (5) well-child care, including neonatal screening and
29-15 routine physical check-ups;
29-16 (6) outpatient clinic or office visits for treatment
29-17 of illness or injury;
29-18 (7) one physical examination per policy year;
29-19 (8) mental health services, including inpatient and
29-20 outpatient evaluation, crisis intervention, and services for
29-21 treatment of a serious mental illness as defined in Sec. 1 of Art.
29-22 3.51-14 of this code;
29-23 (9) medical treatment and referral services for the
29-24 abuse of or addiction to alcohol or drugs, including coverage
29-25 required by Art. 3.51-9 of this code;
30-1 (10) diagnostic examinations, laboratory, and X-ray
30-2 services;
30-3 (11) rehabilitative services;
30-4 (12) home health services as defined in Sec. 1 of Art.
30-5 3.70-3B of this code; and
30-6 (13) prescription drugs, with up to 50 percent
30-7 copayment allowed.
30-8 (b) Coverage for the following preventive care must be
30-9 provided with no copayments or deductibles required:
30-10 (1) childhood immunizations;
30-11 (2) Pap tests;
30-12 (3) mammography, as required by Section 2, Chapter
30-13 397, Acts of the 54th Legislature, Regular Session, 1955 (Article
30-14 3.70-2, Vernon's Texas Insurance Code) and its subsequent
30-15 amendments;
30-16 (4) colo-rectal screening; and
30-17 (5) prostate cancer screening;
30-18 (6) vision and hearing tests for children under 19
30-19 years of age;
30-20 (c) The Standard Health Benefit Plan shall provide lifetime
30-21 benefits of at least $1,000,000 and benefits of at least $250,000
30-22 per policy year.
30-23 (d) The board may adopt rules to implement this article.
30-24 Art. 26.47. PREEXISTING CONDITION PROVISIONS. (a) In this
30-25 article, "preexisting condition provision" means a plan provision
31-1 that denies, excludes, or limits coverage for expenses incurred
31-2 during a period not more than 12 months following the effective
31-3 date of coverage as to a disease or condition for which medical
31-4 advice, diagnosis, or treatment was recommended or received during
31-5 a period not more than 12 months before the effective date of
31-6 coverage.
31-7 (b) A preexisting condition provision in the small employer
31-8 health benefit plans may not apply to an individual who was
31-9 continuously covered by a health benefit plan for a minimum period
31-10 of 9 months which was in effect up to a date not more than 3 months
31-11 before the effective date of the small employer health benefit
31-12 plan.
31-13 (c) A preexisting condition provision may exclude coverage
31-14 for a pregnancy existing on the effective date of coverage, except
31-15 as provided by subsection (b) of this article.
31-16 (d) In determining whether a preexisting condition provision
31-17 applies to an individual covered by the small employer health
31-18 benefit plans, the carrier shall credit the time the individual was
31-19 covered under a previous health benefit plan, if the previous
31-20 coverage was in effect at any time during the 12 months preceding
31-21 the effective date of a small employer health benefit plan
31-22 coverage. If the previous coverage was issued by a health
31-23 maintenance organization, any waiting period that applied before
31-24 that coverage became effective also shall be credited against the
31-25 preexisting condition provision period.
32-1 SUBCHAPTER F. REINSURANCE
32-2 Art. 26.51. ELECTION TO BE RISK-ASSUMING OR REINSURING
32-3 CARRIER; NOTICE TO COMMISSIONER. (a) Each health carrier shall
32-4 notify the commissioner of the carrier's election to operate as a
32-5 risk-assuming carrier or a reinsuring carrier. A health carrier
32-6 seeking to operate as a risk-assuming carrier shall make an
32-7 application under Art. 26.52 of this code.
32-8 (b) A health carrier's election under Subsection (a) of this
32-9 article is effective until the fifth anniversary of the election.
32-10 The commissioner may permit a health carrier to modify its decision
32-11 at any time for good cause shown.
32-12 (c) The commissioner shall establish an application process
32-13 for health carriers seeking to change their status under this
32-14 article.
32-15 (d) A reinsuring carrier that elects to operate as a
32-16 risk-assuming carrier may not continue to reinsure a small employer
32-17 health benefit plan with the system. The carrier shall pay a
32-18 prorated assessment based on business issued as a reinsuring
32-19 carrier for any portion of the year that the business was
32-20 reinsured.
32-21 Art. 26.52. APPLICATION TO BECOME A RISK-ASSUMING CARRIER.
32-22 (a) A health carrier may apply to become a risk-assuming carrier
32-23 by filing an application with the commissioner in a form and manner
32-24 prescribed by the commissioner.
32-25 (b) In evaluating an application filed under Subsection (a)
33-1 of this article, the commissioner shall consider the carrier's:
33-2 (1) financial condition;
33-3 (2) history of rating and underwriting small employer
33-4 groups.
33-5 (3) commitment to market fairly to all small employers
33-6 in the state or in its approved geographic service area; and
33-7 (4) experience with managing the risk of small
33-8 employer groups.
33-9 (c) The commissioner shall provide public notice of an
33-10 application by a health carrier to be a risk-assuming carrier and
33-11 shall provide at least a 60-day period for public comment before
33-12 making a decision on the application. If the application is not
33-13 acted on before the 90th day after the date the commissioner
33-14 received the application, the carrier may request a hearing.
33-15 (d) The commissioner may rescind the approval granted to a
33-16 risk-assuming carrier under this article if the commissioner finds
33-17 that the carrier:
33-18 (1) is not financially able to support the assumption
33-19 of risk from issuing coverage to small employers without the
33-20 protection afforded by the system;
33-21 (2) has failed to market fairly to all small employers
33-22 in the state or its established geographic service area; or
33-23 (3) has failed to provide coverage to eligible small
33-24 employers.
33-25 Art. 26.53. TEXAS HEALTH REINSURANCE SYSTEM. (a) The Texas
34-1 Health Reinsurance System is created. The system is a nonprofit
34-2 entity.
34-3 (b) The system is administered by a board of directors and
34-4 operates subject to the supervision and control of the
34-5 commissioner.
34-6 Art. 26.54. BOARD OF DIRECTORS. (a) The board of directors
34-7 is composed of nine members, appointed by the commissioner. The
34-8 commissioner or the commissioner's designated representative shall
34-9 serve as an ex officio member. Five members must be
34-10 representatives of reinsuring carriers selected from individuals
34-11 nominated by health carriers in this state according to procedures
34-12 developed by the commissioner. Four members must represent the
34-13 general public. A member representing the general public may not
34-14 be:
34-15 (1) an officer, director, or employee of an insurance
34-16 company, agency, agent, broker, solicitor, adjuster, or any other
34-17 business entity regulated by the department;
34-18 (2) a person required to register with the Texas
34-19 Ethics Commission under Chapter 305, Government Code; or
34-20 (3) related to a person described by Subdivision (1)
34-21 or (2) of this subsection within the second degree of affinity or
34-22 consanguinity.
34-23 (b) The directors appointed by the commissioner serve
34-24 two-year terms. The terms expire on December 31 of each
34-25 odd-numbered year. A member's term continues until a successor is
35-1 appointed.
35-2 (c) A member of the board of trustees may not be compensated
35-3 for serving on the board of trustees but is entitled to
35-4 reimbursement for actual expenses incurred in performing functions
35-5 as a member of the board of trustees as provided in the General
35-6 Appropriations Act.
35-7 (d) The board of directors is subject to the open meetings
35-8 law, Chapter 271, Acts of the 60th Legislature, Regular Session,
35-9 1967 (Article 6252-17, Vernon's Texas Civil Statutes), and the open
35-10 records law, Chapter 424, Acts of the 63rd Legislature, Regular
35-11 Session, 1973 (Article 6252-17a, Vernon's Texas Civil Statutes).
35-12 Art. 26.55. PLAN OF OPERATION. (a) Not later than the
35-13 180th day after the date on which a majority of the board of
35-14 directors has been appointed, the board of directors shall submit
35-15 to the commissioner a plan of operation and thereafter any
35-16 amendments necessary or suitable to ensure the fair, reasonable,
35-17 and equitable administration of the system. The commissioner,
35-18 after notice and hearing, may approve the plan of operation if the
35-19 commissioner determines the plan is suitable to ensure the fair,
35-20 reasonable, and equitable administration of the system and provides
35-21 for the sharing of system gains or losses on an equitable and
35-22 proportionate basis in accordance with the provisions of this
35-23 article. The plan of operation is effective on the written
35-24 approval of the commissioner.
35-25 (b) If the board of directors fails to timely submit a
36-1 suitable plan of operation, the commissioner, after notice and
36-2 hearing, shall adopt a temporary plan of operation. The
36-3 commissioner shall amend or rescind any plan adopted under this
36-4 subsection at the time a plan of operation is submitted by the
36-5 board of directors and approved by the commissioner.
36-6 (c) The plan of operation must:
36-7 (1) establish procedures for the handling and
36-8 accounting of system assets and money and for an annual fiscal
36-9 reporting to the commissioner;
36-10 (2) establish procedures for the selection of an
36-11 administering carrier or third party administrator and establish
36-12 the powers and duties of that administering carrier or third party
36-13 administrator;
36-14 (3) establish procedures for reinsuring risks in
36-15 accordance with the provisions of this article;
36-16 (4) establish procedures for collecting assessments
36-17 from reinsuring carriers to fund claims and administrative expenses
36-18 incurred or estimated to be incurred by the system, including the
36-19 imposition of penalties for late payment of an assessment; and
36-20 (5) provide for any additional matters necessary for
36-21 the implementation and administration of the system.
36-22 Art. 26.56. POWERS AND DUTIES OF SYSTEM. The system has the
36-23 general powers and authority granted under the laws of this state
36-24 to insurance companies and health maintenance organizations
36-25 licensed to transact business, except that the system may not
37-1 directly issue health benefit plans. The system is exempt from all
37-2 taxes. The system may:
37-3 (1) enter into contracts necessary or proper to carry
37-4 out the provisions and purposes of this subchapter and may, with
37-5 the approval of the commissioner, enter into contracts with similar
37-6 programs of other states for the joint performance of common
37-7 functions or with persons or other organizations for the
37-8 performance of administrative functions;
37-9 (2) sue or be sued, including taking legal actions
37-10 necessary or proper to recover assessments and penalties for, on
37-11 behalf of, or against the system or a reinsuring carrier;
37-12 (3) take legal action necessary to avoid the payment
37-13 of improper claims against the system;
37-14 (4) issue reinsurance policies, in accordance with the
37-15 requirements of this subchapter;
37-16 (5) establish guidelines, conditions, and procedures
37-17 for reinsuring risks under the plan of operation;
37-18 (6) establish actuarial functions as appropriate for
37-19 the operation of the system;
37-20 (7) assess reinsuring carriers in accordance with the
37-21 provisions of Article 26.60 of this code and make advance interim
37-22 assessments as may be reasonable and necessary for organizational
37-23 and interim operating expenses, provided that any interim
37-24 assessments shall be credited as offsets against regular
37-25 assessments due after the close of the fiscal year;
38-1 (8) appoint appropriate legal, actuarial, and other
38-2 committees as necessary to provide technical assistance in the
38-3 operation of the system, policy and other contract design, and any
38-4 other function within the authority of the system; and
38-5 (9) borrow money for a period not to exceed one year
38-6 to effect the purposes of the system, provided that any notes or
38-7 other evidence of indebtedness of the system not in default shall
38-8 be legal investments for carriers and may be carried as admitted
38-9 assets.
38-10 Art. 26.57. AUDIT BY STATE AUDITOR. (a) The state auditor
38-11 shall conduct annually a special audit of the system under Chapter
38-12 321, Government Code. The state auditor's report shall include a
38-13 financial audit and an economy and efficiency audit.
38-14 (b) The state auditor shall report the cost of each audit
38-15 conducted under this article to the board of directors and the
38-16 comptroller, and the board of directors shall remit that amount to
38-17 the comptroller for deposit to the general revenue fund.
38-18 Art. 26.58. REINSURANCE. (a) A health carrier may reinsure
38-19 risks covered under the small employer health benefit plans with
38-20 the system as provided by this article.
38-21 (b) The system shall reinsure the level of coverage provided
38-22 under the small employer health benefit plans.
38-23 (c) A health carrier may reinsure an entire small employer
38-24 group not later than the 60th day after the date on which the
38-25 group's coverage under the small employer health benefit plans
39-1 takes effect. A health carrier may reinsure an eligible employee
39-2 of a small employer or the employee's dependent not later than the
39-3 60th day after the date on which that individual's coverage takes
39-4 effect. A newly eligible employee or dependent of a reinsured
39-5 small employer group or an individual covered under the small
39-6 employer health benefit plans may be reinsured not later than the
39-7 60th day after the date on which that individual's coverage takes
39-8 effect.
39-9 (d) The system may not reimburse a reinsuring carrier for
39-10 the claims of any reinsured individual until the carrier has
39-11 incurred an initial level of claims for that individual in a
39-12 calendar year of $5,000 for benefits covered by the system. In
39-13 addition, the reinsuring carrier is responsible for 10 percent of
39-14 the next $50,000 of benefit payments during a calendar year, and
39-15 the system shall reinsure the remainder. A reinsuring carrier's
39-16 liability under this subsection may not exceed a maximum of $10,000
39-17 in any one calendar year for any reinsured individual.
39-18 (e) The board of directors annually shall adjust the initial
39-19 level of claims and the maximum to be retained by the carrier
39-20 established under Subsection (d) of this article to reflect
39-21 increases in costs and use for small employer health benefit plans
39-22 within this state. The adjustment may not be less than the annual
39-23 change in the medical component of the Consumer Price Index for All
39-24 Urban Consumers published by the Bureau of Labor Statistics of the
39-25 United States Department of Labor unless the board of directors
40-1 proposes and the commissioner approves a lower adjustment factor.
40-2 (f) A health carrier may terminate reinsurance with the
40-3 system for one or more of the reinsured employees or dependents of
40-4 a small employer on a contract anniversary of the small employer
40-5 health benefit plans.
40-6 (g) Except as provided in the plan of operation, a
40-7 reinsuring carrier shall apply consistently with respect to
40-8 reinsured and nonreinsured business all managed care procedures,
40-9 including utilization review, individual case management, preferred
40-10 provider provisions, and other managed care provisions or methods
40-11 of operation.
40-12 Art. 26.59. PREMIUM RATES. (a) As part of the plan of
40-13 operation, the board of directors shall adopt a method to determine
40-14 premium rates to be charged by the system for reinsuring small
40-15 employer groups and individuals under this subchapter.
40-16 (b) The method adopted must include classification systems
40-17 for small employer groups that reflect the variations in premium
40-18 rates allowed in this chapter and must provide for the development
40-19 of base reinsurance premium rates that reflect the allowable
40-20 variations. The base reinsurance premium rates shall be
40-21 established by the board of directors, subject to the approval of
40-22 the board, and shall be set at levels that reasonably approximate
40-23 the gross premiums charged to small employers by health carriers
40-24 for the small employer health benefit plans, adjusted to reflect
40-25 retention levels required under this subchapter. The board of
41-1 directors periodically shall review the method adopted under this
41-2 subsection, including the classification system and any rating
41-3 factors, to ensure that the method reasonably reflects the claims
41-4 experience of the system. The board of directors may propose
41-5 changes to the method. The changes are subject to the approval of
41-6 the board.
41-7 (c) An entire small employer group may be reinsured at a
41-8 rate that is 1-1/2 times the base reinsurance premium rate for that
41-9 group. An eligible employee of a small employer or the employee's
41-10 dependent covered under the small employer health benefit plans may
41-11 be reinsured at a rate that is five times the base reinsurance
41-12 premium rate for that individual.
41-13 (d) The board of directors may consider adjustments to the
41-14 premium rates charged by the system to reflect the use of effective
41-15 cost containment and managed care arrangements.
41-16 Art. 26.60. ASSESSMENTS. (a) Not later than March 1 of
41-17 each year, the board of directors shall determine and report to the
41-18 commissioner the system net loss for the previous calendar year,
41-19 including administrative expenses and incurred losses for the year,
41-20 taking into account investment income and other appropriate gains
41-21 and losses. Any net loss for the year must be recouped by
41-22 assessments on reinsuring carriers. Each reinsuring carrier's
41-23 assessment shall be determined annually by the board of directors
41-24 based on annual statements and other reports required by the board
41-25 of directors and filed with that board. The board of directors
42-1 shall establish, as part of the plan of operation, a formula by
42-2 which to make assessments against reinsuring carriers. With the
42-3 approval of the commissioner, the board of directors may change the
42-4 assessment formula from time to time as appropriate. The board of
42-5 directors shall base the assessment formula on each reinsuring
42-6 carrier's share of:
42-7 (1) the total premiums earned in the preceding
42-8 calendar year from the small employer health benefit plans
42-9 delivered or issued for delivery by reinsuring carriers to small
42-10 employer groups; and
42-11 (2) the premiums earned in the preceding calendar year
42-12 from newly issued small employer health benefit plans delivered or
42-13 issued for delivery during the calendar year by reinsuring carriers
42-14 to small employer groups in this state.
42-15 (b) The formula established under Subsection (a) of this
42-16 article may not result in an assessment share for a reinsuring
42-17 carrier that is less than 50 percent or more than 150 percent of an
42-18 amount based on the proportion of the total premium earned in the
42-19 preceding calendar year from the small employer health benefit
42-20 plans delivered or issued for delivery to small employer groups in
42-21 this state by that reinsuring carrier to the total premiums earned
42-22 in the preceding calendar year from standard small employer health
42-23 benefit plans delivered or issued for delivery to small employer
42-24 groups in this state by all reinsuring carriers. Premiums earned
42-25 by a reinsuring carrier that are less than an amount determined by
43-1 the board of directors to justify the cost of collection of an
43-2 assessment based on those premiums may not be considered by the
43-3 board in determining assessments.
43-4 (c) With the approval of the commissioner, the board of
43-5 directors may adjust the assessment formula for reinsuring carriers
43-6 that are approved health maintenance organizations that are
43-7 federally qualified under Subchapter XI, Public Health Service Act
43-8 (42 U.S.C. Section 300e et seq.), to the extent that any
43-9 restrictions are imposed on those health maintenance organizations
43-10 that are not imposed on other health carriers.
43-11 Art. 26.61. EVALUATION OF SYSTEM. (a) Not later than March
43-12 1 of each year, the board of directors shall file with the
43-13 commissioner an estimate of the assessments necessary to fund the
43-14 losses for small employer groups incurred by the system during the
43-15 previous calendar year.
43-16 (b) If the board of directors determines that the necessary
43-17 assessments exceed five percent of the total premiums earned in the
43-18 previous calendar year from small employer health benefit plans
43-19 delivered or issued for delivery by reinsuring carriers to small
43-20 employer groups in this state, the board shall evaluate the
43-21 operation of the system and shall report its findings, including
43-22 any recommendations for changes to the plan of operation, to the
43-23 commissioner not later than the 90th day after December 31 of the
43-24 calendar year in which the losses were incurred. The evaluation
43-25 must include an estimate of future assessments and must consider
44-1 the administrative costs of the system, the appropriateness of the
44-2 premiums charged, the level of insurer retention under the system,
44-3 and the costs of coverage for small employer groups.
44-4 (c) If the board of directors fails to timely file a report,
44-5 the commissioner may evaluate the operations of the system and may
44-6 implement amendments to the plan of operation as considered
44-7 necessary by the commissioner to reduce future losses and
44-8 assessments.
44-9 (d) For any calendar year, the maximum assessment amount
44-10 payable shall not exceed five percent of total premiums earned in
44-11 the previous calendar year from small employer health benefit plans
44-12 delivered or issued for delivery by reinsuring carriers in this
44-13 state.
44-14 Art. 26.62. DEFERMENT OF ASSESSMENT. (a) A reinsuring
44-15 carrier may petition the commissioner for a deferment in whole or
44-16 in part of an assessment imposed by the board of directors.
44-17 (b) The commissioner may defer all or part of the assessment
44-18 of a reinsuring carrier if the commissioner determines that the
44-19 payment of the assessment would endanger the ability of the
44-20 reinsuring carrier to fulfill its contractual obligations.
44-21 (c) If an assessment against a reinsuring carrier is
44-22 deferred, the amount deferred shall be assessed against the other
44-23 participating carriers in a manner consistent with the basis for
44-24 assessment established by this subchapter.
44-25 (d) A reinsuring carrier receiving a deferment is liable to
45-1 the system for the amount deferred and is prohibited from
45-2 reinsuring any individual or group with the system until it pays
45-3 the outstanding assessment.
45-4 SUBCHAPTER G. MARKETING
45-5 Art. 26.71. FAIR MARKETING. (a) Each health carrier shall
45-6 actively market the small employer health benefit plan through
45-7 properly licensed agents to eligible small employers in this state.
45-8 Each small employer purchasing a small employer health benefit plan
45-9 must affirm that the agent who sold the plan offered and explained
45-10 all three plans to that employer.
45-11 (b) The department shall require periodic demonstration by
45-12 health carriers and agents that those carriers and agents are
45-13 marketing or issuing health care benefit plans to small employers
45-14 in fulfillment of the purposes of this article.
45-15 (c) The department may require periodic reports by health
45-16 carriers and agents regarding small employer health care benefit
45-17 plans issued by those carriers and agents. The reporting
45-18 requirements shall include but not be limited to information
45-19 regarding case characteristics and the numbers of health care
45-20 benefit plans in various categories that are marketed or issued to
45-21 small employers.
45-22 Art. 26.72. HEALTH STATUS AND CLAIMS EXPERIENCE; PROHIBITED
45-23 ACTS. (a) A health carrier or agent may not, directly or
45-24 indirectly:
45-25 (1) encourage or direct a small employer to refrain
46-1 from applying for coverage with the health carrier because of
46-2 health status or claims experience; or
46-3 (2) encourage or direct a small employer to seek
46-4 coverage from another health carrier because of health status or
46-5 claims experience.
46-6 (b) A health carrier may not, directly or indirectly, enter
46-7 into any agreement or arrangement with an agent that provides for
46-8 or results in the compensation paid to an agent for the sale of the
46-9 small employer health benefit plans to be varied because of health
46-10 status or claims experience.
46-11 (c) Subsection (b) of this article does not apply to an
46-12 arrangement that provides compensation to an agent on the basis of
46-13 percentage of premium, provided that the percentage may not vary
46-14 because of health status or claims experience.
46-15 (d) A health carrier or agent may not encourage a small
46-16 employer to exclude an eligible employee from health coverage
46-17 provided in connection with the employee's employment.
46-18 Art. 26.73. AGENTS. (a) A health carrier shall pay the
46-19 same commission, percentage of premium or other amount to an agent
46-20 for renewal of a small employer health benefit plan as the carrier
46-21 paid for original placement of the plan. Compensation for renewal
46-22 of a plan may be adjusted upward to reflect an increase in the cost
46-23 of living or similar factors.
46-24 (b) A health carrier may not terminate, fail to renew, or
46-25 limit its contract or agreement of representation with an agent for
47-1 any reason related to the health status or claims experience of a
47-2 small employer group placed by the agent with the carrier.
47-3 Art. 26.74. WRITTEN STATEMENT OF DENIAL, CANCELLATION, OR
47-4 REFUSAL TO RENEW. Denial by a health carrier of an application for
47-5 coverage from a small employer or a cancellation or refusal to
47-6 renew must be in writing and must state the reason or reasons for
47-7 the denial, cancellation, or refusal.
47-8 Art. 26.75. RULES. The board may adopt rules setting forth
47-9 additional standards to provide for the fair marketing and broad
47-10 availability of small employer health benefit plans to small
47-11 employers in this state.
47-12 Art. 26.76. VIOLATION. (a) A violation of this subchapter
47-13 by a health carrier or an agent is an unfair method of competition
47-14 and an unfair or deceptive act or practice under Article 21.21 of
47-15 this code.
47-16 (b) If a health carrier enters into an agreement with a
47-17 third-party administrator to provide administrative, marketing, or
47-18 other services related to the offering of small employer health
47-19 benefit plans to small employers in this state, the third-party
47-20 administrator is subject to this article.
47-21 SECTION 2. Subchapter E, Chapter 21, Insurance Code, is
47-22 amended by adding Articles 21.52C and 21.52D to read as follows:
47-23 Art. 21.52C. PRIMARY AND PREVENTIVE CARE. (a) In this
47-24 article, "health benefit plan" means a group, blanket, or franchise
47-25 insurance policy, a certificate issued under a group policy, a
48-1 group hospital service contract, a group subscriber contract, or
48-2 evidence of coverage issued by a health maintenance organization
48-3 that provides benefits for health care services.
48-4 (b) A health benefit plan must provide coverage for primary
48-5 and preventive care services.
48-6 (c) Coverage for preventive care services may not be subject
48-7 to a deductible or copayment and must include coverage for:
48-8 (1) immunizations;
48-9 (2) Pap tests;
48-10 (3) colo-rectal screenings;
48-11 (4) prostate cancer screenings;
48-12 (5) mammography, as required by Section 2, Chapter
48-13 397, Acts of the 54th Legislature, Regular Session, 1955 (Article
48-14 3.70-2, Vernon's Texas Insurance Code) and its subsequent
48-15 amendments; and
48-16 (6) vision and hearing examinations for children under
48-17 the age of 19.
48-18 (d) The board shall adopt rules governing the type of
48-19 coverage to be provided, the services covered, and the amount of
48-20 any allowable deductible or copayment.
48-21 Art. 21.52D. UNIFORM POLICY APPLICATIONS AND CLAIM FORMS AND
48-22 PROCEDURES
48-23 Sec. 1. DEFINITIONS. In this article:
48-24 (1) "Application form" means the first form signed and
48-25 submitted to a health carrier by an applicant for coverage under a
49-1 health benefit plan.
49-2 (2) "Claim form" means a form used to claim a benefit
49-3 payable under a health benefit plan.
49-4 (3) "Health carrier" means any insurer, group hospital
49-5 service corporation, health maintenance organization, or other
49-6 entity authorized to issue a health benefit plan in this state.
49-7 (4) "Health benefit plan" means an individual, group,
49-8 blanket, or franchise insurance policy, a group hospital service
49-9 contract, or a group subscriber contract or evidence of coverage
49-10 issued by a health maintenance organization that provides benefits
49-11 for health care services. The term includes the health benefit
49-12 plans issued under Chapter 26 of this code and its subsequent
49-13 amendments.
49-14 Sec. 2. UNIFORM FORMS. (a) The board shall adopt a uniform
49-15 application form and a uniform claim form to be used by all
49-16 health carriers in this state. A health carrier may not use an
49-17 application form other than the uniform application form or a claim
49-18 form other than the uniform claim form.
49-19 (b) The board may not adopt a form under Subsection (a) of
49-20 this section unless it is written in plain language. For purposes
49-21 of this subsection, a form is written in plain language if it
49-22 achieves the minimum score established by the commissioner on the
49-23 Flesch reading ease test or an equivalent test selected by the
49-24 commissioner. This subsection does not apply to language appearing
49-25 on the form that is mandated by state or federal law.
50-1 Sec. 3. UNIFORM PROCEDURES. The board by rule shall adopt a
50-2 uniform claims procedure. A health carrier may not use a claims
50-3 procedure other than the uniform claims procedure adopted by the
50-4 board.
50-5 SECTION 3. Section 1(d)(3), Article 3.51-6, Insurance Code,
50-6 is amended to read as follows:
50-7 (3) Any insurer or group hospital service corporation
50-8 subject to Chapter 20, Insurance Code, and its subsequent
50-9 amendments, who issues policies which provide hospital, surgical,
50-10 or major medical expense insurance or any combination of these
50-11 coverages on an expense incurred basis, but not a policy which
50-12 provides benefits for specified disease or for accident only, shall
50-13 provide a conversion or group continuation privilege as required by
50-14 this subsection. Any employee, member, or dependent whose
50-15 insurance under the group policy has been terminated for any reason
50-16 except involuntary termination for cause, including discontinuance
50-17 of the group policy in its entirety or with respect to an insured
50-18 class, and who has been continuously insured under the group policy
50-19 and under any group policy providing similar benefits which it
50-20 replaces for at least three consecutive months immediately prior to
50-21 termination shall be entitled to such coverages as outlined in
50-22 Paragraph (A), (B), or (C) below. Involuntary termination for
50-23 cause does not include termination for any health-related cause.
50-24 (A)(i) <Coverage under> An insurer shall offer
50-25 to each employee, member or dependent an individual or a group
51-1 conversion policy without evidence of insurability if written
51-2 application and payment of the first premium is made within 31 days
51-3 after such termination. The converted policy shall provide the
51-4 same coverage and benefits as provided under the group policy or
51-5 plan unless the employee, member or dependent elects lesser
51-6 coverage and benefits which shall only be provided on policy forms
51-7 containing the same coverage and benefits as the PREVENTIVE AND
51-8 PRIMARY CARE BENEFIT PLAN, the IN-HOSPITAL BENEFIT PLAN, and the
51-9 STANDARD HEALTH BENEFIT PLAN promulgated under Subchapter E,
51-10 Chapter 26. <an individual policy or group conversion policy of
51-11 accident and health insurance without evidence of insurability if
51-12 written application and payment of the first premium is made within
51-13 31 days after such termination>. An employee, member, or dependent
51-14 shall not be entitled to have a converted policy or plan issued if
51-15 termination of the insurance under the group policy occurred
51-16 because: (aa) such person failed to pay any required premium; or
51-17 (bb) any discontinued group coverage was replaced by similar group
51-18 coverage within 31 days.
51-19 (ii) An insurer shall not be required to
51-20 issue a converted policy covering any person if: (aa) such person
51-21 is or could be covered by Medicare; (bb) such person is covered
51-22 for similar benefits by another hospital, surgical, medical, or
51-23 major medical expense insurance policy or hospital or medical
51-24 service subscriber contract or medical practice or other prepayment
51-25 plan or by any other plan or program; (cc) such person is eligible
52-1 for similar benefits whether or not covered therefor under any
52-2 arrangement of coverage for individuals in a group, whether on an
52-3 insured or uninsured basis; or (dd) similar benefits are provided
52-4 for or available to such person, pursuant to or in accordance with
52-5 the requirements of any state or federal law. <or (ee) the
52-6 benefits provided under the sources herein enumerated, together
52-7 with the benefits provided by the converted policy, would result in
52-8 overinsurance according to the insurer's standards. The insurer's
52-9 standards must bear some reasonable relationship to actual health
52-10 care costs in the area in which the insured lives at the time of
52-11 conversion and must be filed with the commissioner of insurance
52-12 prior to their use in denying coverage. The board shall issue
52-13 rules and regulations to establish minimum standards for benefits
52-14 under policies issued pursuant to this subsection.>
52-15 (B)(i) Policies subject to Paragraph (A) above
52-16 shall provide at the <insurer's> option of the employee, member or
52-17 dependent in lieu of the requirements of Paragraph (A) continuation
52-18 of group coverage for employees or members and their eligible
52-19 dependents subject to the eligibility provisions of Paragraph (A).
52-20 (ii) Continuation of group coverage <need
52-21 not include dental, vision care, or prescription drug benefits and
52-22 must> shall be requested in writing within 21 days following the
52-23 later of: (aa) the date the group coverage would otherwise
52-24 terminate; or (bb) the date the employee is given notice of the
52-25 right of continuation by either the employer or the group
53-1 policyholder.
53-2 (iii) In no event may the employee or
53-3 member elect continuation more than 31 days after the date of such
53-4 termination.
53-5 (iv) An employee or member electing
53-6 continuation must pay to the group policyholder or employer, on a
53-7 monthly basis in advance, the amount of contribution required by
53-8 the policyholder or employer, but not more than the group rate for
53-9 the insurance being continued under the group policy, plus two % of
53-10 that group rate, on the due date of each payment.
53-11 (v) The employee's or member's written
53-12 election of continuation, together with the first contribution
53-13 required to establish contributions on a monthly basis in advance,
53-14 must be given to the policyholder or employer within 31 days of the
53-15 date coverage would otherwise terminate.
53-16 (vi) Continuation may not terminate until
53-17 the earliest of: (aa) six months after the date the election is
53-18 made; (bb) failure to make timely payments; (cc) the date on which
53-19 the group coverage terminates in its entirety; (dd) or one of the
53-20 conditions specified in items (aa) through (dd) <(ee)> of
53-21 Subparagraph (ii), Paragraph (A) above is met by the covered
53-22 individual.
53-23 (C) <The insurer may elect to provide group
53-24 insurance coverage in lieu of the issuance of a converted policy
53-25 under Paragraph (A) above.> The premium for the converted policy
54-1 issued under Paragraph (A) of this subdivision (or the group
54-2 coverage under Paragraph (C) of this subdivision) shall<, should>
54-3 be determined in accordance with the insurer's table of premium
54-4 rates for coverage which was provided under the group policy or
54-5 plan. <applicable to the age and class of risk of each person to
54-6 be covered under that policy and the type and amount of insurance
54-7 provided.>
54-8 (i) The premium may be based on the age of
54-9 each person to be covered and the type of converted policy.
54-10 (ii) The premium for the same coverage and
54-11 benefits under a converted policy shall not exceed 200% of the
54-12 premium determined in accordance with this paragraph.
54-13 (iii) The premium for lesser coverage and
54-14 benefits under a converted policy shall not exceed 100% of the
54-15 premium determined in accordance with this paragraph.
54-16 SECTION 4. REINSURANCE STUDY. (a) The Texas Department of
54-17 Insurance shall initiate a comprehensive study into the future
54-18 solvency of the reinsurance system established by Subchapter F,
54-19 Chapter 26, Insurance Code, as added by this Act.
54-20 (b) The department shall review and analyze, from an
54-21 actuarial standpoint, the potential cost of catastrophic losses to
54-22 the system and recommend funding methods to adequately finance any
54-23 anticipated losses to the system. The department shall also
54-24 develop an actuarial model to assess the system's future operation.
54-25 The department shall fully investigate the experience of other
55-1 states with health reinsurance systems.
55-2 (c) The department shall report its findings to the
55-3 Legislature no later than January 1, 1995.
55-4 SECTION 5. Not later than November 1, 1993, each carrier
55-5 subject to Chapter 26, Insurance Code, as added by this Act, shall
55-6 file a report with the commissioner that states the carrier's gross
55-7 premiums derived from health benefit plans delivered, issued for
55-8 delivery, or renewed to small employers in 1992.
55-9 SECTION 6. Not later than November 1, 1993, a carrier
55-10 subject to Chapter 26, Insurance Code, as added by this Act, shall
55-11 notify the commissioner of its initial election to operate as a
55-12 risk-assuming or reinsuring carrier under Article 26.51, Insurance
55-13 Code, as added by this Act.
55-14 SECTION 7. In making the initial appointments to the board
55-15 of trustees of the Texas Health Benefits Purchasing Cooperative
55-16 established under Subchapter B, Chapter 26, Insurance Code, as
55-17 added by this Act, the governor shall appoint two members for terms
55-18 expiring February 1, 1995, two members for terms expiring February
55-19 1, 1997, and two members for terms expiring February 1, 1999.
55-20 SECTION 8. (a) Except as otherwise provided by this
55-21 section, this Act takes effect September 1, 1993.
55-22 (b) A health carrier is not required to issue a small
55-23 employer health benefit plan, as required by Subchapter E, Chapter
55-24 26, Insurance Code, as added by this Act, before January 1, 1994.
55-25 After that date, a carrier may not deliver or issue for delivery to
56-1 a small employer a health benefit plan other than a small employer
56-2 health benefit plan, as required by Subchapter E, Chapter 26,
56-3 Insurance Code, as added by this Act.
56-4 (c) A health carrier may not market a health benefit plan
56-5 other than the small employer health benefit plan, as required by
56-6 Subchapter E, Chapter 26, Insurance Code, as added by this Act,
56-7 after January 1, 1995.
56-8 (d) The Texas Health Reinsurance System may not reinsure a
56-9 risk in accordance with Subchapter E, Chapter 26, Insurance Code,
56-10 as added by this Act, before January 1, 1994.
56-11 (e) Article 21.52C, Insurance Code, as added by this Act,
56-12 applies only to a health benefit plan that is delivered, issued for
56-13 delivery, or renewed on or after January 1, 1994. A health benefit
56-14 plan that is delivered, issued for delivery, or renewed before
56-15 January 1, 1994, is governed by the law as it existed immediately
56-16 before the effective date of this Act, and that law is continued in
56-17 effect for that purpose.
56-18 (f) Article 21.52D, Insurance Code, as added by this Act,
56-19 applies only to the use of an application form, claim form, or
56-20 claims procedure on or after January 1, 1994.
56-21 (g) Section 1(d)(3), Article 3.51-6, Insurance Code, as
56-22 amended by this Act, applies only to conversion of a policy
56-23 delivered, issued for delivery, or renewed on or after January 1,
56-24 1994. Conversion of a policy that was delivered, issued for
56-25 delivery, or renewed before January 1, 1994, is governed by the law
57-1 in effect immediately before the effective date of this Act, and
57-2 that law is continued in effect for this purpose.
57-3 SECTION 9. The importance of this legislation and the
57-4 crowded condition of the calendars in both houses create an
57-5 emergency and an imperative public necessity that the
57-6 constitutional rule requiring bills to be read on three several
57-7 days in each house be suspended, and this rule is hereby suspended.