By Sibley S.B. No. 1665
74R9306 DLF-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to small employer health benefit plans.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Article 26.06, Insurance Code, is amended by
1-5 amending Subsection (b) and adding Subsection (d) to read as
1-6 follows:
1-7 (b) This <Except as provided by Subsection (a) of this
1-8 article, this> chapter does not apply to an individual health
1-9 insurance policy that is underwritten individually.
1-10 (d) This chapter may not be used as a standard for, or for
1-11 purposes of policy approval of, a policy that is not subject to
1-12 this chapter.
1-13 SECTION 2. (a) Subsection (b), Article 26.21, Insurance
1-14 Code, is amended to read as follows:
1-15 (b) Coverage under a small employer health benefit plan is
1-16 not available to a small employer unless the small employer pays at
1-17 least 50 <75> percent of the insurance premium for its eligible
1-18 employees who elect to be covered by at least one of the small
1-19 employer health benefit plans selected by the small employer.
1-20 Coverage is available under a small employer health benefit plan if
1-21 at least 90 percent of a small employer's eligible employees elect
1-22 to be covered. A small employer is not required to pay any amount
1-23 with respect to an employee who elects not to be covered. The
1-24 small employer may elect to pay the premium cost for additional
2-1 coverage. This chapter does not require a small employer to
2-2 purchase health insurance coverage for the employer's employees.
2-3 (b) The heading of Article 26.21, Insurance Code, is amended
2-4 to read as follows:
2-5 Art. 26.21. SMALL EMPLOYER HEALTH BENEFIT PLANS;
2-6 CONTRIBUTION AND PARTICIPATION <EMPLOYER ELECTION>.
2-7 SECTION 3. Subsections (a) and (c), Article 26.33, Insurance
2-8 Code, are amended to read as follows:
2-9 (a) The percentage increase in the premium rate charged to a
2-10 small employer for a new rating period may not exceed the sum of:
2-11 (1) the percentage change in the new business premium
2-12 rate measured from the first day of the prior rating period to the
2-13 first day of the new rating period;
2-14 (2) any adjustment, not to exceed 20 <15> percent
2-15 annually and adjusted pro rata for rating periods of less than one
2-16 year, due to the claim experience, health status, or duration of
2-17 coverage of the employees or dependents of the small employer as
2-18 determined from the small employer carrier's rate manual for the
2-19 class of business; and
2-20 (3) any adjustment due to change in coverage or change
2-21 in the case characteristics of the small employer as determined
2-22 from the small employer carrier's rate manual for the class of
2-23 business.
2-24 (c) A health carrier may use the industry classification to
2-25 which a small employer belongs as a case characteristic in
2-26 establishing premium rates, but the highest rate factor associated
2-27 with any industry classification may not exceed the lowest rate
3-1 factor associated with any industry classification by more than 20
3-2 <15> percent, unless actuarially justified based on a loss claims
3-3 ratio.
3-4 SECTION 4. Article 26.42, Insurance Code, is amended by
3-5 amending Subsection (a) and adding Subsection (e) to read as
3-6 follows:
3-7 (a) A small employer carrier may <shall> offer the
3-8 <following> three health benefit plans described by this subsection
3-9 by making an election and complying with Subsection (e) of this
3-10 article. The three health benefit plans are:
3-11 (1) the preventive and primary care benefit plan;
3-12 (2) the in-hospital benefit plan; and
3-13 (3) the standard health benefit plan.
3-14 (e) A small employer carrier that elects to offer a health
3-15 benefit plan under Subsection (a) of this article shall attach to
3-16 the policy an election form provided by the carrier and signed by
3-17 the employer.
3-18 SECTION 5. Subsection (a), Article 26.21, Insurance Code, is
3-19 repealed.
3-20 SECTION 6. This Act takes effect September 1, 1995.
3-21 SECTION 7. This Act applies only to a small employer health
3-22 benefit plan under Chapter 26, Insurance Code, delivered, issued
3-23 for delivery, or renewed on or after the effective date of this
3-24 Act. A small employer health benefit plan delivered, issued for
3-25 delivery, or renewed before the effective date of this Act is
3-26 governed by the law as it existed immediately before the effective
3-27 date, and that law is continued in effect for that purpose.
4-1 SECTION 8. The importance of this legislation and the
4-2 crowded condition of the calendars in both houses create an
4-3 emergency and an imperative public necessity that the
4-4 constitutional rule requiring bills to be read on three several
4-5 days in each house be suspended, and this rule is hereby suspended.