By Rangel H.B. No. 1700
75R4516 CAS-F
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
1-15 Article 3.51-6, Insurance Code, and any other law applicable to
1-16 group health insurance policies or contracts issued in this state.
1-17 The 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 or
1-20 intervention that has a significant recovery period, presents a
1-21 significant risk, employs a general anesthetic, or, in the opinion
1-22 of the primary physician, involves a significant invasion of bodily
1-23 integrity that requires the extraction of bodily fluids or an
1-24 incision or that produces substantial pain, discomfort, or
2-1 debilitation. The coverage may include managed care or preventive
2-2 care and must be substantially similar [comparable] to the basic
2-3 health coverage provided under the Texas Employees Uniform Group
2-4 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
2-5 Code). The cost of the coverage may be shared by the employees and
2-6 the district. Each district shall report [certify] the district's
2-7 compliance with this subsection to the executive director of the
2-8 Teacher Retirement System of Texas not later than November 1 of
2-9 each year in the manner required by the board of trustees of the
2-10 Teacher Retirement System of Texas. The report [certification]
2-11 must include a copy of the district's current contract for group
2-12 health coverage.
2-13 (b) The executive director of the Teacher Retirement System
2-14 of Texas must certify whether a district's group health coverage is
2-15 substantially similar to the basic health coverage provided under
2-16 the Texas Employees Uniform Group Insurance Benefits Act (Article
2-17 3.50-2, Vernon's Texas Insurance Code). In making that
2-18 determination, the executive director must consider factors
2-19 including:
2-20 (1) the results of an examination of the entity
2-21 underwriting the district's plan;
2-22 (2) an accounting of uninsured costs to or copayments
2-23 required of district employees;
2-24 (3) district costs by employee and category;
2-25 (4) the schedule of benefits provided, including the
2-26 percentage of costs paid by the provider; and
2-27 (5) the length of the period the provider has offered
3-1 coverage in the district.
3-2 (c) If the executive director of the Teacher Retirement
3-3 System of Texas determines that the group health coverage offered
3-4 by a district is not substantially similar to the basic health
3-5 coverage under the Texas Employees Uniform Group Insurance Act
3-6 (Article 3.50-2, Vernon's Texas Insurance Code), the executive
3-7 director shall report that information to the district and to the
3-8 Legislative Budget Board. The executive director shall submit a
3-9 report to the legislature not later than January 1 of each
3-10 odd-numbered year describing the status of each district's group
3-11 health coverage program based on the certification required by this
3-12 section.
3-13 (d) A school district may not contract with an insurer, a
3-14 company subject to Chapter 20, Insurance Code, or a health
3-15 maintenance organization to issue a policy or contract under this
3-16 section, or with any person to assist the school district in
3-17 obtaining or managing the policy or contract unless, before the
3-18 contract is entered into, the insurer, company, organization, or
3-19 person provides the district with an audited financial statement
3-20 showing the financial condition of the insurer, company,
3-21 organization, or person.
3-22 (e) [(c)] An insurer, a company subject to Chapter 20,
3-23 Insurance Code, or a health maintenance organization that issues a
3-24 policy or contract under this section and any person that assists
3-25 the school district in obtaining or managing the policy or contract
3-26 for compensation shall provide an annual audited financial
3-27 statement to the school district showing the financial condition of
4-1 the insurer, company, organization, or person.
4-2 (f) [(d)] An audited financial statement provided under this
4-3 section must be made in accordance with rules adopted by the
4-4 commissioner of insurance or state auditor, as applicable.
4-5 SECTION 2. Section 22.004, Education Code, as amended by
4-6 this Act, applies to group health coverage for school district
4-7 employees beginning with coverage for the 1997-1998 school year.
4-8 SECTION 3. The importance of this legislation and the
4-9 crowded condition of the calendars in both houses create an
4-10 emergency and an imperative public necessity that the
4-11 constitutional rule requiring bills to be read on three several
4-12 days in each house be suspended, and this rule is hereby suspended,
4-13 and that this Act take effect and be in force from and after its
4-14 passage, and it is so enacted.