1-1 By: Averitt, et al. (Senate Sponsor - Patterson) H.B. No. 369
1-2 (In the Senate - Received from the House May 4, 1995;
1-3 May 5, 1995, read first time and referred to Committee on Economic
1-4 Development; May 18, 1995, reported adversely, with favorable
1-5 Committee Substitute by the following vote: Yeas 7, Nays 0;
1-6 May 18, 1995, sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR H.B. No. 369 By: Patterson
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the operation and funding of small employer health
1-11 benefit plans.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Article 26.02, Insurance Code, is amended by
1-14 amending Subdivisions (8), (12), and (23) and by adding Subdivision
1-15 (25) to read as follows:
1-16 (8) "Eligible employee" means an employee who works on
1-17 a full-time basis and who usually works at least 30 hours a week.
1-18 The term includes a sole proprietor, a partner, and an independent
1-19 contractor, if the sole proprietor, partner, or independent
1-20 contractor is included as an employee under a health benefit plan
1-21 of a small employer. The term does not include:
1-22 (A) an employee who works on a part-time,
1-23 temporary, seasonal, or substitute basis; or
1-24 (B) an employee who is covered under:
1-25 (i) another health benefit plan; <or>
1-26 (ii) a self-funded or self-insured <an>
1-27 employee welfare benefit plan that provides health benefits and
1-28 that is established in accordance with the Employee Retirement
1-29 Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.);
1-30 (iii) the Medicaid program if the employee
1-31 elects not to be covered;
1-32 (iv) another federal program, including
1-33 the CHAMPUS program or Medicare program, if the employee elects not
1-34 to be covered; or
1-35 (v) a benefit plan established in another
1-36 country if the employee elects not to be covered.
1-37 (12) "Late enrollee" means an eligible employee or
1-38 dependent who requests enrollment in a small employer's health
1-39 benefit plan after the expiration of the initial enrollment period
1-40 established under the terms of the first plan for which that
1-41 employee or dependent was eligible through the small employer or
1-42 after the expiration of an open enrollment period under Article
1-43 26.21(e) of this code. An eligible employee or dependent is not a
1-44 late enrollee if:
1-45 (A) the individual:
1-46 (i) was covered under another employer
1-47 health benefit plan at the time the individual was eligible to
1-48 enroll;
1-49 (ii) declines in writing, at the time of
1-50 the initial eligibility, stating that coverage under another
1-51 employer health benefit plan was the reason for declining
1-52 enrollment;
1-53 (iii) has lost coverage under another
1-54 employer health benefit plan as a result of the termination of
1-55 employment, the termination of the other plan's coverage, the death
1-56 of a spouse, or divorce; and
1-57 (iv) requests enrollment not later than
1-58 the 31st day after the date on which coverage under another
1-59 employer health benefit plan terminates;
1-60 (B) the individual is employed by an employer
1-61 who offers multiple health benefit plans and the individual elects
1-62 a different health benefit plan during an open enrollment period;
1-63 or
1-64 (C) a court has ordered coverage to be provided
1-65 for a spouse or minor child under a covered employee's plan and
1-66 request for enrollment is made not later than the 31st day after
1-67 issuance of the date on which the court order is issued.
1-68 (23) "Small employer health benefit plan" means a plan
2-1 developed by the commissioner under <the preventive and primary
2-2 care benefit plan, the in-hospital benefit plan, or the standard
2-3 health benefit plan described by> Subchapter E of this chapter or
2-4 any other health benefit plan offered to a small employer in
2-5 accordance with Article 26.42(c) or 26.48 <(d)> of this code.
2-6 (25) "Point-of-service contract" means a benefit plan
2-7 offered through a health maintenance organization that:
2-8 (A) includes corresponding indemnity benefits in
2-9 addition to benefits relating to out-of-area or emergency services
2-10 provided through insurers or group hospital service corporations;
2-11 and
2-12 (B) permits the insured to obtain coverage under
2-13 either the health maintenance organization conventional plan or the
2-14 indemnity plan as determined in accordance with the terms of the
2-15 contract.
2-16 SECTION 2. Article 26.06(b), Insurance Code, is amended to
2-17 read as follows:
2-18 (b) Except as provided by Subsection (a) of this article,
2-19 this chapter does not apply to an individual health insurance
2-20 policy that is subject to individual underwriting, even if the
2-21 premiums are remitted through a payroll deduction method
2-22 <underwritten individually>.
2-23 SECTION 3. Article 26.14, Insurance Code, is amended to read
2-24 as follows:
2-25 Art. 26.14. PRIVATE PURCHASING COOPERATIVE. (a) Two or
2-26 more small employers may form a cooperative for the purchase of
2-27 small employer health benefit plans. A cooperative must be
2-28 organized as a nonprofit corporation and has the rights and duties
2-29 provided by the Texas Non-Profit Corporation Act (Article 1396-1.01
2-30 et seq., Vernon's Texas Civil Statutes).
2-31 (b) On receipt of a certificate of incorporation or
2-32 certificate of authority from the secretary of state, the
2-33 cooperative shall file written notification of the receipt of the
2-34 certificate and a copy of the cooperative's organizational
2-35 documents with the commissioner.
2-36 (c) The board of directors shall file annually with the
2-37 commissioner a statement of all amounts collected and expenses
2-38 incurred for each of the preceding three years.
2-39 (d) A purchasing cooperative or a member of the board of
2-40 directors, the executive director, or an employee or agent of a
2-41 purchasing cooperative is not liable for:
2-42 (1) an act performed in good faith in the execution of
2-43 duties in connection with the purchasing cooperative; or
2-44 (2) an independent action of a small employer
2-45 insurance carrier or a person who provides health care services
2-46 under a health benefit plan.
2-47 SECTION 4. Article 26.21, Insurance Code, is amended to read
2-48 as follows:
2-49 Art. 26.21. SMALL EMPLOYER HEALTH BENEFIT PLANS; EMPLOYER
2-50 ELECTION. (a) Each small employer carrier shall provide the small
2-51 employer health benefit plans without regard to claim experience,
2-52 health status, or medical history. Each small employer carrier
2-53 shall issue the plan chosen by the small employer to each small
2-54 employer that elects to be covered under that plan<, agrees to make
2-55 the required premium payments,> and agrees to satisfy the other
2-56 requirements of the plan.
2-57 (b) This article does not impose a statutory mandate of an
2-58 employer contribution to the premium paid to the small employer
2-59 carrier. However, the small employer carrier may require an
2-60 employer contribution in accordance with the carrier's usual and
2-61 customary practices on all employer group health insurance plans in
2-62 this state. The premium contribution level shall be applied
2-63 uniformly to each small employer offered or issued coverage by the
2-64 small employer carrier in this state. If two or more small
2-65 employer carriers participate in a purchasing cooperative
2-66 established under Article 26.14 of this code, the carrier may use
2-67 the contribution requirement established by the purchasing
2-68 cooperative for policies marketed by the cooperative. <Coverage
2-69 under a small employer health benefit plan is not available to a
2-70 small employer unless the small employer pays at least 75 percent
3-1 of the insurance premium for its eligible employees who elect to be
3-2 covered by at least one of the small employer health benefit plans
3-3 selected by the small employer.> Coverage is available under a
3-4 small employer health benefit plan if at least 75 <90> percent of a
3-5 small employer's eligible employees elect to be covered.
3-6 (c) If a small employer offers multiple health benefit
3-7 plans, the collective enrollment of all of those plans must be at
3-8 least 75 percent of the small employer's eligible employees or, if
3-9 applicable, the lower participation level offered by the small
3-10 employer carrier under Subsection (d) of this article. A small
3-11 employer carrier may elect not to offer health benefit plans to a
3-12 small employer who offers multiple health benefit plans if such
3-13 plans are to be provided by more than one carrier and the small
3-14 employer carrier would have less than 75 percent of the small
3-15 employer's eligible employees enrolled in the small employer
3-16 carrier's health benefit plan unless the coverage is provided
3-17 through a purchasing cooperative. A small employer who elects to
3-18 make contributions for payment of the premium is not required to
3-19 pay any amount with respect to an employee who elects not to be
3-20 covered. The small employer may elect to pay the premium cost for
3-21 additional coverage. This chapter does not require a small
3-22 employer to purchase health insurance coverage for the employer's
3-23 employees.
3-24 (d) A small employer carrier <(c) An eligible employee> may
3-25 offer small employer health benefit plans to a small <obtain
3-26 coverage in addition to coverage purchased by the> employer even if
3-27 less than 75 <at least 40> percent of the eligible employees of
3-28 that employer elect to be covered if:
3-29 (1) the plans are offered on a guaranteed issue basis
3-30 and the small employer carrier permits the same percentage of
3-31 participation as a qualifying percentage for each small employer
3-32 benefit plan offered by that carrier in this state; or
3-33 (2) the plans are not offered on a guaranteed issue
3-34 basis and:
3-35 (A) the small employer obtains a written waiver
3-36 for each eligible employee who declines coverage under a health
3-37 plan offered to the small employer, ensuring that the eligible
3-38 employee was not induced or pressured into declining coverage
3-39 because of the employee's risk characteristics; and
3-40 (B) the small employer carrier accepts or
3-41 rejects the entire group of eligible employees that choose to
3-42 participate and excludes only those employees that have declined
3-43 coverage, provided that the carrier may underwrite the group of
3-44 eligible employees that do not decline coverage <obtain the same
3-45 additional coverage. Subject to insurability, any number of
3-46 eligible employees may otherwise obtain coverage in addition to
3-47 coverage purchased by the employer. The additional coverage may be
3-48 paid for by the employer, the employee, or both>.
3-49 (e) A small employer carrier may not provide coverage to a
3-50 small employer or the employees of a small employer under
3-51 Subsection (d)(2) of this article if the health carrier or an agent
3-52 for the health carrier knows that the small employer has induced or
3-53 pressured an eligible employee or the employee's dependents to
3-54 decline coverage because of an individual's risk characteristics.
3-55 (f) A small employer carrier, an employer, or an agent may
3-56 not use the provisions of Subsection (d)(2) of this article to
3-57 circumvent the requirements of this chapter.
3-58 (g) Except as otherwise provided by this chapter, a small
3-59 employer carrier may not establish a separate class or classes of
3-60 business for small employers.
3-61 (h) <(d)> The initial enrollment period for the employees
3-62 and their dependents must be at least 31 <30> days, with a 31-day
3-63 open enrollment period provided annually.
3-64 (i) <(e)> A small employer may establish a waiting period
3-65 during which a new employee is not eligible for coverage. A
3-66 waiting period established as provided by this subsection may not
3-67 exceed 90 days from the first day of employment.
3-68 (j) <(f)> A new employee of a covered small employer and the
3-69 dependents of that employee may not be denied coverage if the
3-70 application for coverage is received by the small employer carrier
4-1 not later than the 31st day after the date on which the employment
4-2 begins or on completion of a waiting period established by the
4-3 employer under Subsection (i) of this article.
4-4 (k) <(g)> A late enrollee may be excluded from coverage
4-5 until the next annual open enrollment period and <for 18 months
4-6 from the date of application or> may be subject to a 12-month
4-7 preexisting condition provision as described by Article <Articles>
4-8 26.49<(b), (c), (d), and (e)> of this code. <If both a period of
4-9 exclusion from coverage and a preexisting condition provision are
4-10 applicable to a late enrollee, the combined period of exclusion may
4-11 not exceed 18 months from the date of the late application.>
4-12 (l) <(h)> A small employer carrier may not exclude any
4-13 eligible employee or dependent, including a late enrollee, who
4-14 would otherwise be covered under a small employer group.
4-15 (m) <(i)> A small employer health benefit plan issued by a
4-16 small employer carrier may not limit or exclude, by use of a rider
4-17 or amendment applicable to a specific individual, coverage by type
4-18 of illness, treatment, medical condition, or accident, except for
4-19 preexisting conditions or diseases as permitted under Article 26.49
4-20 of this code.
4-21 (n) <(j)> A small employer health benefit plan may not limit
4-22 or exclude initial coverage of a newborn child of a covered
4-23 employee. Any coverage of a newborn child of an employee under
4-24 this subsection terminates on the 32nd <31st> day after the date of
4-25 the birth of the child unless:
4-26 (1) dependent children are eligible for coverage; and
4-27 (2) notification of the birth and any required
4-28 additional premium are received by the small employer carrier not
4-29 later than the 31st <30th> day after the date of birth.
4-30 (o) <(k)> If the Consolidated Omnibus Budget Reconciliation
4-31 Act of 1985 (Pub. L. No. 99-272, 100 Stat. 222) does not require
4-32 continuation or conversion coverage for dependents of an employee,
4-33 a dependent who has been covered by that small employer for at
4-34 least one year or is under one year of age may elect to continue
4-35 coverage under a small employer health benefit plan, if the
4-36 dependent loses eligibility for coverage because of the death,
4-37 divorce, or retirement of the employee, as required by Section 3B,
4-38 Article 3.51-6, of this code.
4-39 SECTION 5. Article 26.31, Insurance Code, is amended by
4-40 adding Subsections (e) and (f) to read as follows:
4-41 (e) A small employer carrier may not establish a separate
4-42 class of business based on participation requirements.
4-43 (f) A small employer carrier may not establish a separate
4-44 class of business based on whether the coverage provided to a small
4-45 employer group is provided on a guaranteed issue basis or is
4-46 subject to underwriting or proof of insurability.
4-47 SECTION 6. Article 26.38, Insurance Code, is amended to read
4-48 as follows:
4-49 Art. 26.38. HEALTH MAINTENANCE ORGANIZATION; APPROVED HEALTH
4-50 BENEFIT PLAN. (a) The premium rates for a state-approved health
4-51 benefit plan offered by a health maintenance organization under
4-52 Article 26.48 of this code must be established in accordance with
4-53 formulas or schedules of charges filed with the department.
4-54 (b) A health maintenance organization that participates in a
4-55 purchasing cooperative that provides employees of small employers a
4-56 choice of benefit plans, that has established a separate class of
4-57 business as provided by Article 26.31 of this code, and that has
4-58 established a separate line of business as provided under Article
4-59 26.48(a) of this code and Title XIII, Public Health Service Act (42
4-60 U.S.C. Section 300e et seq.) may use rating methods in accordance
4-61 with this subchapter that are used by other small employer carriers
4-62 participating in the same cooperative, including rating by age and
4-63 gender.
4-64 SECTION 7. Article 26.42, Insurance Code, is amended to read
4-65 as follows:
4-66 Art. 26.42. SMALL EMPLOYER HEALTH BENEFIT PLANS. (a) A
4-67 small employer carrier shall offer the following two <three> health
4-68 benefit plans as adopted by the commissioner:
4-69 (1) the catastrophic <preventive and primary> care
4-70 benefit plan; and
5-1 (2) the basic coverage <in-hospital> benefit plan<;
5-2 and>
5-3 <(3) the standard health benefit plan>.
5-4 (b) A small employer carrier may offer to a small employer
5-5 additional benefit riders to either of the <standard health>
5-6 benefit plans <plan>.
5-7 (c) <A small employer carrier may not offer to a small
5-8 employer benefit riders to:>
5-9 <(1) the preventive and primary care benefit plan,
5-10 except as provided by Article 26.45(d) of this code; or>
5-11 <(2) the in-hospital benefit plan, except as provided
5-12 by Article 26.46(e) of this code.>
5-13 <(d)> Subject to the provisions of this chapter, a small
5-14 employer carrier may also offer to small employers any other health
5-15 benefit plan authorized under this code. Article 26.06(c) does not
5-16 apply to a health benefit plan offered to a small employer under
5-17 this subsection.
5-18 SECTION 8. Article 26.43(a), Insurance Code, is amended to
5-19 read as follows:
5-20 (a) The commissioner shall promulgate the benefits section
5-21 of the catastrophic care <preventive and primary> benefit plan
5-22 and<,> the basic coverage <in-hospital> benefit plan<, and the
5-23 standard health benefit plan> policy forms in accordance with
5-24 Article 26.44A of this code and shall develop prototype policies
5-25 for each of the benefit plans. For all other portions of these
5-26 policy forms, a small employer carrier shall comply with Article
5-27 3.42 of this code as it relates to policy form approval and with
5-28 the Texas Health Maintenance Organization Act (Article 20A.01 et
5-29 seq., Vernon's Texas Insurance Code) as it relates to approval of
5-30 an evidence of coverage. A small employer carrier may not offer
5-31 these <three> benefit plans through a policy form or evidence of
5-32 coverage that does not comply with this chapter <article>.
5-33 SECTION 9. Subchapter E, Chapter 26, Insurance Code, is
5-34 amended by adding Article 26.44A to read as follows:
5-35 Art. 26.44A. BENEFIT PLANS. (a) The commissioner by rule
5-36 shall establish the coverage requirements for the catastrophic care
5-37 benefit plan and the basic coverage benefit plan. The commissioner
5-38 shall develop prototype policies for use by small employer carriers
5-39 that include all contractual provisions required to produce an
5-40 entire contract in accordance with this article and this code.
5-41 (b) Coverage under the catastrophic care benefit plan must
5-42 be designed to provide necessary coverage in the event of
5-43 catastrophic illness or injury. The commissioner shall establish
5-44 deductibles and coinsurance requirements at levels that permit
5-45 options for the insured to obtain affordable catastrophic coverage.
5-46 (c) The commissioner by rule shall establish coverage
5-47 requirements for the basic coverage benefit plan. Coverage under
5-48 the basic coverage benefit plan must be designed to provide basic
5-49 hospital, medical, and surgical coverages. Benefits under the plan
5-50 are limited to basic care requirements for illness and injury.
5-51 (d) The benefits provisions of the benefit plan policies
5-52 must include the following:
5-53 (1) all required or applicable definitions;
5-54 (2) a list of any exclusions or limitations to
5-55 coverage;
5-56 (3) a description of covered services required under
5-57 the plan; and
5-58 (4) the deductible and coinsurance options that are
5-59 required or permitted under the plan.
5-60 SECTION 10. Article 26.48, Insurance Code, is amended to
5-61 read as follows:
5-62 Art. 26.48. HEALTH MAINTENANCE ORGANIZATION PLANS. (a)
5-63 Instead of the small employer health benefit plans described by
5-64 this subchapter, a health maintenance organization may offer:
5-65 (1) a state-approved health benefit plan that complies
5-66 with the requirements of Title XIII <XI>, Public Health Service Act
5-67 (42 U.S.C. Section 300e et seq.) and rules adopted under that Act;
5-68 (2) a plan developed by the commissioner under Article
5-69 26.44A of this code and additional benefit riders to the plan; or
5-70 (3) a point-of-service contract in connection with an
6-1 insurance carrier that includes optional coverage for out-of-area
6-2 services, emergency care, or out-of-network care.
6-3 (b) A contract offered by an insurance carrier under
6-4 Subsection (a)(3) of this article is subject to all provisions of
6-5 this chapter unless specifically exempted. The insurance carrier
6-6 with which the health maintenance organization contracts for a
6-7 point-of-service contract is not required to otherwise make
6-8 available the benefit plans adopted under Subchapter E of this
6-9 chapter if the insurance carrier's small employer products are
6-10 limited to the point-of-service contract.
6-11 SECTION 11. Article 26.49, Insurance Code, is amended to
6-12 read as follows:
6-13 Art. 26.49. PREEXISTING CONDITION AND WAITING PERIOD
6-14 PROVISIONS. (a) A <Except as provided by Article 26.21(g) of this
6-15 code, a> preexisting condition provision in a small employer health
6-16 benefit plan may not apply to expenses incurred on or after the
6-17 expiration of the 12 months following <first anniversary of> the
6-18 initial effective date of coverage of the enrollee or late
6-19 enrollee.
6-20 (b) A preexisting condition provision in a small employer
6-21 health benefit plan may not apply to coverage for a disease or
6-22 condition other than a disease or condition<:>
6-23 <(1)> for which medical advice, diagnosis, care, or
6-24 treatment was recommended or received during the six months before
6-25 the effective date of coverage<; or>
6-26 <(2) that would have caused an ordinary, prudent
6-27 person to seek medical advice, diagnosis, care, or treatment during
6-28 the six months before the effective date of coverage>.
6-29 (c) A preexisting condition provision in a small employer
6-30 health benefit plan may not apply to an individual who was
6-31 continuously covered for a minimum period of 12 months by a health
6-32 benefit plan that was in effect up to a date not more than 60 days
6-33 before the effective date of coverage under the small employer
6-34 health benefit plan, excluding any waiting period.
6-35 (d) <A preexisting condition provision may exclude coverage
6-36 for a pregnancy existing on the effective date of the coverage,
6-37 except as provided by Subsection (c) of this article.>
6-38 <(e)> In determining whether a preexisting condition
6-39 provision applies to an individual covered by a small employer
6-40 health benefit plan, the small employer carrier shall credit the
6-41 time the individual was covered under a previous health benefit
6-42 plan if the previous coverage was in effect at any time during the
6-43 12 months preceding the effective date of coverage under a small
6-44 employer health benefit plan. If the previous coverage was issued
6-45 by a health maintenance organization, any waiting period that
6-46 applied before that coverage became effective also shall be
6-47 credited against the preexisting condition provision period.
6-48 (e) A carrier that does not use a preexisting condition
6-49 provision in any of its health benefit plans may impose an
6-50 affiliation period. For purposes of this subsection, "affiliation
6-51 period" means a period not to exceed 90 days for new enrollees and
6-52 not to exceed 180 days for late enrollees during which premiums are
6-53 not collected and the issued coverage is not effective.
6-54 (f) Subsection (e) of this article does not preclude
6-55 application of any waiting period applicable to all new enrollees
6-56 under the health benefit plan. However, any carrier-imposed
6-57 waiting period may not exceed 90 days and must be used in lieu of a
6-58 preexisting condition provision.
6-59 SECTION 12. Article 26.54, Insurance Code, is amended by
6-60 adding Subsection (e) to read as follows:
6-61 (e) There is no liability on the part of, and no cause of
6-62 action of any nature arises against, a member of the board of
6-63 directors for action or omission performed in good faith in the
6-64 performance of powers and duties under this subchapter.
6-65 SECTION 13. Article 26.71, Insurance Code, is amended to
6-66 read as follows:
6-67 Art. 26.71. FAIR MARKETING. (a) Each small employer
6-68 carrier shall market the small employer health benefit plan through
6-69 properly licensed agents to eligible small employers in this state.
6-70 Each small employer purchasing a small employer health benefit plan
7-1 shall be given a summary of the benefit plans established by the
7-2 commissioner under Subchapter E of this chapter. The commissioner
7-3 shall prescribe the format of the summary. The <must affirm that
7-4 the> agent shall offer and explain each of the plans to the small
7-5 employer on inquiry and request by the small <who sold the plan
7-6 offered and explained all three plans to that> employer.
7-7 (b) <The department may require periodic demonstration by
7-8 small employer carriers and agents that those carriers and agents
7-9 are marketing or issuing small employer health benefit plans to
7-10 small employers in fulfillment of the purposes of this article.>
7-11 <(c)> The department may require periodic reports by small
7-12 employer carriers and agents regarding small employer health
7-13 benefit plans issued by those carriers and agents. The reporting
7-14 requirements shall include information regarding case
7-15 characteristics and the numbers of small employer health benefit
7-16 plans in various categories that are marketed or issued to small
7-17 employers.
7-18 SECTION 14. Article 26.75, Insurance Code, is amended to
7-19 read as follows:
7-20 Art. 26.75. RULES. The commissioner <board> may adopt rules
7-21 setting forth additional standards to provide for the fair
7-22 marketing and broad availability of small employer health benefit
7-23 plans to small employers in this state.
7-24 SECTION 15. Section 1(d)(3)(A)(i), Article 3.51-6, Insurance
7-25 Code, is amended to read as follows:
7-26 (i) An insurer shall first offer to each
7-27 employee, member, or dependent a conversion policy without evidence
7-28 of insurability if written application for and payment of the first
7-29 premium is made not later than the 31st day after the date of the
7-30 termination. The converted policy shall provide similar <the same>
7-31 coverage and benefits as provided under the group policy or plan.
7-32 The lifetime maximum benefits shall be computed from the initial
7-33 date of the employee's, member's, or dependent's coverage with the
7-34 group. An insurer shall offer and an employee, member, or
7-35 dependent may elect lesser coverage and benefits. An employee,
7-36 member, or dependent shall not be entitled to have a converted
7-37 policy or plan issued if termination of the insurance occurred
7-38 because: (aa) such person failed to pay any required premium; or
7-39 (bb) any discontinued group coverage was replaced by similar group
7-40 coverage within 31 days.
7-41 SECTION 16. Articles 26.45, 26.46, 26.47, and 26.47A,
7-42 Insurance Code, are repealed effective June 1, 1996.
7-43 SECTION 17. The commissioner of insurance shall develop and
7-44 adopt rules establishing small employer health benefit plans under
7-45 Subchapter E, Chapter 26, Insurance Code, as amended by this Act,
7-46 not later than January 1, 1996.
7-47 SECTION 18. (a) Each small employer health benefit plan,
7-48 including prototype plans developed by the commissioner of
7-49 insurance, under Chapter 26, Insurance Code, as amended by this
7-50 Act, shall be offered, delivered, or issued for delivery to small
7-51 employers beginning June 1, 1996.
7-52 (b) A small employer health benefit plan issued before
7-53 September 1, 1993, is governed by the law in effect immediately
7-54 before September 1, 1993, except that on and after September 1,
7-55 1995, those plans are subject to the provisions of Subchapter D,
7-56 Chapter 26, Insurance Code, as amended by this Act.
7-57 (c) A small employer health benefit plan issued on or after
7-58 September 1, 1993, but before June 1, 1996, must comply with
7-59 Chapter 26, Insurance Code, as amended by this Act, beginning on
7-60 the first renewal date of the health benefit plan following June 1,
7-61 1996.
7-62 (d) Article 26.38, Insurance Code, as amended by this Act,
7-63 applies to small employer health benefit plans offered, issued, or
7-64 issued for delivery on or after September 1, 1995.
7-65 SECTION 19. This Act takes effect September 1, 1995.
7-66 SECTION 20. The importance of this legislation and the
7-67 crowded condition of the calendars in both houses create an
7-68 emergency and an imperative public necessity that the
7-69 constitutional rule requiring bills to be read on three several
7-70 days in each house be suspended, and this rule is hereby suspended.
8-1 * * * * *