RS H.B. 2795 75(R)    BILL ANALYSIS


INSURANCE
H.B. 2795
By: Averitt
4-21-97
Committee Report (Unamended)



BACKGROUND 

The Legislature created the Texas Health Benefits Purchasing Cooperative
in 1993 to help small employers obtain health insurance coverage.  The
cooperative, which operates under the business name Texas Insurance
Purchasing Alliance, began statewide service in 1995 and now serves over
1,000 Texas employers.  The cooperative is governed by a 6-member board
appointed by the Governor. 

PURPOSE

This bill seeks to make minor changes in the statute creating the
cooperative in order to streamline operations. 

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 Article 26.11(4), Insurance Code, as follows:

(4) Adds non-profit corporation to definition of Texas Cooperative.

SECTION 2. Amends 26.13(a), Insurance Code, to read as follows:

Art. 26.13 TEXAS HEALTH BENEFITS PURCHASING COOPERATIVE

(a) Changes "organization" to "corporation"  in defining the Texas Health
Benefits Purchasing Cooperative. 

SECTION 3. Amends Article 26.13(b), Insurance Code, as follows: 

(b) Deletes language that makes executive director of Texas Department of
Commerce a nonvoting ex officio member of the Texas Cooperative. 

SECTION 4. Amends Article 26.13(h), Insurance Code, as follows:

(h) Amends section to make Texas cooperative as well as members of the
cooperative not liable for an act of good faith in connection with the
duties of the Texas Cooperative, and for an action of a small employer
insurance carrier or a person who provides health care services under a
health benefit plan. 

SECTION 5. Amends Article 26.15(a), Insurance Code, by adding paragraph 10
as follows: 

Art. 26.15.  POWERS AND DUTIES OF TEXAS HEALTH BENEFITS PURCHASING
COOPERATIVE AND PRIVATE PURCHASING COOPERATIVE 

 (a) (10) A cooperative may offer ancillary products and services to its
members as are customarily offered in conjunction with health benefit
plans. 

SECTION 6. Amends Article 26.15(d), Insurance Code, to read as follows:

(d) A cooperative shall comply with federal laws applicable to
cooperatives and health benefit plans issued by cooperatives to the extent
required by state law or rules adopted by the commissioner.   A
cooperative will comply with state laws applicable to cooperatives and
health benefit plans issued through cooperatives. 

SECTION 7. Amends Article 26.16, Insurance Code, to read as follows:

(b) A cooperative is considered an employer solely for the purposes of
benefit elections under this code. 

(c) Reletters subsection (c).  

(d) Adds subsection saying that a licensed agent used and paid by the
cooperative does not need to be appointed by each small employer carrier
participating in the cooperative in order to market the products and
services sponsored by the cooperative.  A licensed agent may not market a
non-sponsored product or service of a participating small employer carrier
without being appointed by the small employer carrier. 

SECTION 8. Act takes effect on September 1, 1997.

SECTION 9. Emergency Clause