By Rangel, et al. H.B. No. 1700
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to group health coverage for school district employees.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 22.004, Education Code, is amended to
1-5 read as follows:
1-6 Sec. 22.004. GROUP HEALTH BENEFITS FOR SCHOOL EMPLOYEES.
1-7 (a) Each district shall make available to its employees group
1-8 health coverage provided by a risk pool established by one or more
1-9 school districts under Chapter 172, Local Government Code, or under
1-10 a policy of insurance or group contract issued by an insurer, a
1-11 company subject to Chapter 20, Insurance Code, or a health
1-12 maintenance organization under the Texas Health Maintenance
1-13 Organization Act (Chapter 20A, Vernon's Texas Insurance Code). The
1-14 coverage must meet the substantive coverage requirements of Article
1-15 3.51-6, Insurance Code, and any other law applicable to group
1-16 health insurance policies or contracts issued in this state. The
1-17 coverage must include major medical treatment but may exclude
1-18 experimental procedures. In this subsection, "major medical
1-19 treatment" means a medical, surgical, or diagnostic procedure for
1-20 illness or injury [or intervention that has a significant recovery
1-21 period, presents a significant risk, employs a general anesthetic,
1-22 or, in the opinion of the primary physician, involves a significant
1-23 invasion of bodily integrity that requires the extraction of bodily
1-24 fluids or an incision or that produces substantial pain,
2-1 discomfort, or debilitation]. The coverage may include managed
2-2 care or preventive care and must be comparable to the basic health
2-3 coverage provided under the Texas Employees Uniform Group Insurance
2-4 Benefits Act (Article 3.50-2, Vernon's Texas Insurance Code). The
2-5 board of trustees of the Teacher Retirement System of Texas shall
2-6 adopt rules to determine whether a school district's group health
2-7 coverage is comparable to the basic health coverage specified by
2-8 this subsection. The rules must provide for consideration of the
2-9 following factors concerning the district's coverage in determining
2-10 whether the district's coverage is comparable to the basic health
2-11 coverage specified by this subsection:
2-12 (1) the deductible amount for service provided inside
2-13 and outside of the network;
2-14 (2) the coinsurance percentages for service provided
2-15 inside and outside of the network;
2-16 (3) the maximum amount of coinsurance payments a
2-17 covered person is required to pay;
2-18 (4) the amount of the copayment for an office visit;
2-19 (5) the schedule of benefits and the scope of
2-20 coverage;
2-21 (6) the lifetime maximum benefit amount; and
2-22 (7) verification that the coverage is issued by a
2-23 provider licensed to do business in this state by the Texas
2-24 Department of Insurance, is provided by a risk pool authorized
2-25 under Chapter 172, Local Government Code, or that a district is
2-26 capable of covering the assumed liabilities in the case of coverage
2-27 provided through district self-insurance.
3-1 (b) The cost of the coverage may be shared by the employees
3-2 and the district.
3-3 (c) Each district shall report [certify] the district's
3-4 compliance with this subsection to the executive director of the
3-5 Teacher Retirement System of Texas not later than November 1 of
3-6 each year in the manner required by the board of trustees of the
3-7 Teacher Retirement System of Texas. The report [certification]
3-8 must be based on the district group health coverage plan in effect
3-9 on November 1 and must include:
3-10 (1) appropriate documentation of:
3-11 (A) [a copy of] the district's [current]
3-12 contract for group health coverage with a provider licensed to do
3-13 business in this state by the Texas Department of Insurance; or
3-14 (B) a resolution of the board of trustees of the
3-15 district authorizing a self-insurance plan for district employees
3-16 and of the district's review of district ability to cover the
3-17 liability assumed;
3-18 (2) the schedule of benefits;
3-19 (3) the premium rate sheet, including the amount paid
3-20 by the district and employees;
3-21 (4) the number of employees covered by each health
3-22 coverage plan offered by the district; and
3-23 (5) any other information considered appropriate by
3-24 the executive director of the Teacher Retirement System of Texas.
3-25 (d) Based on the criteria prescribed by Subsection (a), the
3-26 executive director of the Teacher Retirement System of Texas shall
3-27 certify whether a district's coverage is comparable to the basic
4-1 health coverage provided under the Texas Employees Uniform Group
4-2 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
4-3 Code). If the executive director of the Teacher Retirement System
4-4 of Texas determines that the group health coverage offered by a
4-5 district is not comparable, the executive director shall report
4-6 that information to the district and to the Legislative Budget
4-7 Board. The executive director shall submit a report to the
4-8 legislature not later than January 1 of each odd-numbered year
4-9 describing the status of each district's group health coverage
4-10 program based on the report submitted by the school district and
4-11 the certification required by this section.
4-12 (e) [(b)] A school district may not contract with an
4-13 insurer, a company subject to Chapter 20, Insurance Code, or a
4-14 health maintenance organization to issue a policy or contract under
4-15 this section, or with any person to assist the school district in
4-16 obtaining or managing the policy or contract unless, before the
4-17 contract is entered into, the insurer, company, organization, or
4-18 person provides the district with an audited financial statement
4-19 showing the financial condition of the insurer, company,
4-20 organization, or person.
4-21 (f) [(c)] An insurer, a company subject to Chapter 20,
4-22 Insurance Code, or a health maintenance organization that issues a
4-23 policy or contract under this section and any person that assists
4-24 the school district in obtaining or managing the policy or contract
4-25 for compensation shall provide an annual audited financial
4-26 statement to the school district showing the financial condition of
4-27 the insurer, company, organization, or person.
5-1 (g) [(d)] An audited financial statement provided under this
5-2 section must be made in accordance with rules adopted by the
5-3 commissioner of insurance or state auditor, as applicable.
5-4 SECTION 2. This Act applies beginning with the 1998-1999
5-5 school year.
5-6 SECTION 3. The importance of this legislation and the
5-7 crowded condition of the calendars in both houses create an
5-8 emergency and an imperative public necessity that the
5-9 constitutional rule requiring bills to be read on three several
5-10 days in each house be suspended, and this rule is hereby suspended,
5-11 and that this Act take effect and be in force from and after its
5-12 passage, and it is so enacted.