RS C.S.H.B. 2092 75(R) BILL ANALYSIS INSURANCE C.S.H.B. 2092 By: Eiland 4-15-97 Committee Report (Substituted) BACKGROUND The Texas Department of Insurance regulates the advertisement of health insurance policies and managed care products in Texas. Currently, the Department regulations generally prohibit advertising rates for health care products. Rates may be used only if an advertisement includes a complete list of all policy exclusions and limitations. This interpretation restricts advertising rates entirely because most policies contain the standard laundry list of exclusions, such as cosmetic surgery and self inflicted injuries. PURPOSE The legislation clarifies the ability to advertise by specifically allowing the advertisement of rates by insurers and health maintenance organizations. It would require that the advertisements be accompanied by disclaimers which clearly indicate that the advertised rate is illustrative and that benefit limitations and exclusions may apply. 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. - Amends Subchapter B, Chapter 21, Insurance Code, by adding Article 21.20-2 as follows: Art. 21.20-2 ADVERTISEMENTS FOR CERTAIN HEALTH BENEFIT PLANS Sec 1. - SCOPE OF ARTICLE - Addresses the plans that are and are not covered by this article. Sec. 2. - DISCLAIMERS - Notwithstanding Article 21.21, Insurance Code, an advertisement for a health benefit plan does not have to include information about all benefit exclusions and limitations if the adds indicate: the rates are illustrative, a person should not send money to the provider in response to the advertisement, a person cannot obtain coverage without filling out the application, and that exclusions and limitations may apply to the plan. SECTION 2. - Emergency clause, Effective Date upon passage. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 2092 incorporates the legislative council definition of "health benefit plan" to clarify which insurance plans this measure shall apply. The new term specifically includes any health insurance plan regulatable by the State of Texas including Section 5.01(a) of the Medical Practice Act nonprofit health corporations and does not include plans for specific disease coverage, accidental death or dismemberment, wage recovery insurance, and a long-term care health insurance policy. Additionally C.S.H.B. 2092 clarifies that advertisement may include rate quotes if it complies with the specific disclaimers that indicate that the rates are illustrative, that the person should send no money, that applications must be filed prior to qualification for coverage, and that exclusions and limitations may apply.