LEGISLATIVE BUDGET BOARD
                          Austin, Texas

                           FISCAL NOTE
                       74th Regular Session

                          April 13, 1995



 TO:     Honorable John Smithee, Chair          IN RE: Committee Substitute
         Committee on Insurance                 for
         House of Representatives                              House Bill
         Austin, Texas                          No. 369










FROM: John Keel, Director

In response to your request for a Fiscal Note on House Bill No.
369 (relating to the operation and funding of small employer
health benefit plans) this office has determined the following:

The bill would make no appropriation but could provide the legal
basis for an appropriation of funds to implement the provisions
of the bill.

The bill would amend the Insurance Code to change some provisions
of the Small Employer Health Insurance Availability Act.  The
changes would address minimum participation and contribution
requirements, open enrollment, and the required prototype benefit
plans.  A "Benefits Planning Committee" would be established to
develop benefit provisions for the catastrophic care plan and the
basic coverage plan; committee members would be authorized to
receive reimbursement of expenses.

Implementation of the bill would increase the number of health
insurance form submissions to the Department of Insurance to
bring the forms into compliance with bill provisions.  However,
agency costs for reviewing the additional form filings would be
addressed with existing staff.  Fees associated with the
additional form filings would also result in a revenue gain
during fiscal year 1996.  The amount of any revenue gain,
however, would be subject to potential shifts among currently
insuring employers to more basic levels of coverage in order to    




achieve savings.

Reimbursement of expenses for advisory committee members would be 
subject to legislation enacted during the Seventy-third Regular
Session (Senate Bill 383 codified as V.A.C.S. 6252-33) relating
to the existence, composition and expenses of state agency
advisory committees.  Specifically, the manner and amount of
reimbursement for expenses may be prescribed only by the General
Appropriations Act or through the budget execution process.

The probable fiscal implication of implementing the provisions of
the bill during each of the first  five years following passage
is estimated as follows:



            Fiscal   Probable Revenue 
             Year   Gain to Department
                        Insurance     
                        Operating     
                         Fund 036     
                                      
          1996                $108,000
          1997                       0
                                      
          1998                       0
                                      
          1999                       0
          2000                       0
                                      
                                      
                                      
       Similar annual fiscal implications would continue as long as the
provisions of the bill are in effect.

No fiscal implication to units of local government is
anticipated.


Source:   Comptroller of Public Accounts, Department of Insurance
          LBB Staff: JK, RM, RR