BILL ANALYSIS



H.B. 491
By: De La Garza
05-08-95
Committee Report (Unamended)


BACKGROUND

     During the 73rd Legislature, H.B. 2055 was passed which
amongst other things excluded a preexisting condition as a reason
for denying a health care contract to a person for certain health
care plans that fell under the small employer health care ability
act. However, with that law in the books as passed, insurance
companies are still denying health care coverage to people because
of "preexisting conditions" because the law allows them for certain
health care plans. 

PURPOSE

     As proposed, House Bill 491 would exclude a "preexisting
condition" as a reason to deny a any health insurance contract to
an applicant.

RULEMAKING AUTHORITY

     It is the committee's opinion that this bill does not
expressly grant any additional rulemaking authority to a state
officer, department, agency or institution.

SECTION BY SECTION ANALYSIS

SECTION 1.

Subchapter E, Chapter 21, Insurance Code, is amended by adding
Article 21.49-2E to read as follows: 
          PROHIBITION ON DENIAL OR EXCLUSION OF COVERAGE
                    FOR PREEXISTING CONDITION 

Sec. 1:    DEFINITIONS. 

In this article: 

(1)  "Health insurance contract" means a health insurance policy,
agreement, contract, or  evidence of coverage that is delivered or
issued for delivery by a health insurer.

(2)  "Health insurer" means an insurance company, group hospital
service corporation, or  health maintenance organization that
delivers or issues for delivery an individual, group,  blanket, or
franchise insurance policy or insurance agreement, a group hospital
service    contract, or an evidence of coverage that provides
benefits for medical or surgical   expenses incurred as a result of
an accident or sickness.

(3)  "Preexisting condition" means a medical condition of an
applicant for coverage under a     health insurance contract that
manifested itself before a determination on the application      for coverage is made.

Sec. 2:    DENIAL PROHIBITED. 

A health insurer may not refuse to issue a health insurance
contract to an applicant because of a preexisting condition.


Sec. 3:    EXCLUSION PROHIBITED.

A health insurer may not issue a health insurance contract that
excludes coverage for a preexisting condition.

SECTION 2. 

Effective Date September 1, 1995, and applies only to a health
insurance contract that is delivered, issued for delivery, or
renewed on or after January 1, 1996.

SECTION 3.     Emergency Clause

SUMMARY OF COMMITTEE ACTION

     In accordance with House rules, H.B. 491 was heard in a public
hearing on April 26, 1995.  The Chair laid out H.B. 491 and
recognized Representative De La Garza to explain the bill.  The
Chair recognized the following persons to testify in support of
H.B. 491:  Ann T. Cloyd, Texas Association of Health Underwriters;
David Pinkus, Small Business United of Texas;
Jacqueline Shannon, Texas Alliance for the Mentally Ill; Robert
Schneider, Consumers Union.

     The Chair recognized the following persons to testify in
opposition to H.B. 491: Robert W. Blevins, Texas Life Insurance
Association; Will D. Davis, Texas Legal Reserve Officials
Association; James L. Young, Statesman National Life Insurance
Company.  The Chair left H.B. 491 as pending business before the
Committee.

     Pursuant to an announcement filed with the Journal Clerk and
read by the Reading Clerk, the House Committee on Insurance met in
a formal meeting on May 8, 1995 at desk #24 on the House Floor and
was called to order by the Chair, Representative John Smithee.

     The Chair laid out H.B. 491 as pending business and recognized
Representative Shields who moved the Committee report H.B. 491 as
filed to the full House with the recommendation that it do pass, be
printed and be sent to the Committee on Local and Consent. 
Representative Averitt seconded the motion and the motion prevailed
by the following vote: AYES: (6); NAYES (0); PNV (0); ABSENT (3).