1-1 By: Smithee (Senate Sponsor - Cain) H.B. No. 3027 1-2 (In the Senate - Received from the House May 2, 1997; 1-3 May 5, 1997, read first time and referred to Committee on Finance; 1-4 May 16, 1997, reported favorably by the following vote: Yeas 11, 1-5 Nays 0; May 16, 1997, sent to printer.) 1-6 A BILL TO BE ENTITLED 1-7 AN ACT 1-8 relating to recoupment of certain professional liability discounts 1-9 in lieu of reimbursement under Chapter 110, Civil Practice and 1-10 Remedies Code; and declaring an emergency. 1-11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-12 SECTION 1. Article 5.15-1, Insurance Code, is amended by 1-13 adding Section 10 to read as follows: 1-14 Sec. 10. PREMIUM DISCOUNT RECOUPMENT. (a) Eligibility. 1-15 Effective January 1, 1999, each insurer that has filed and issued 1-16 premium discounts to health care professionals pursuant to Article 1-17 5.15-4 of this code shall be eligible to elect to receive a premium 1-18 tax credit in lieu of indemnification for claims filed with the 1-19 Attorney General under Chapter 110, Civil Practice and Remedies 1-20 Code. 1-21 (b) Amount of Tax Credit. An eligible company may elect to 1-22 recoup premium discounts issued to eligible health care 1-23 professionals in lieu of indemnification from the State of Texas 1-24 for claims filed under Chapter 110, Civil Practice and Remedies 1-25 Code. Such election shall be made as a credit that is part of the 1-26 annual premium tax return filed on or before March 1, 1999. An 1-27 insurer may credit the total amount of any discounts issued less 1-28 any reimbursements received prior to January 1, 1999, by the 1-29 insurer for claims filed under Chapter 110, Civil Practice and 1-30 Remedies Code, against its premium tax under Article 4.10 of this 1-31 code. The tax credit herein authorized shall be allowed at a rate 1-32 not to exceed 20 percent of the credit per year for five or more 1-33 successive years following the initial election made in March 1999. 1-34 The balance of payments due the insurer and not claimed as a tax 1-35 credit may be reflected in the books and records of the insurer as 1-36 an admitted asset for all purposes, including exhibition in annual 1-37 statements pursuant to Article 6.12 of this code. The tax credit 1-38 allowed in any one year may not exceed the premium tax due in that 1-39 year. 1-40 (c) An eligible insurer that elects to receive tax credits 1-41 shall not be eligible to file claims for indemnity under Chapter 1-42 110, Civil Practice and Remedies Code after January 1, 1999. Any 1-43 claims of an eligible insurer filed with the Attorney General prior 1-44 to January 1, 1999, that have not been reimbursed shall also be 1-45 deemed to have been waived by the insurer by making its election. 1-46 An insurer that elects not to recoup its discount through tax 1-47 credit will continue to remain eligible for indemnification of 1-48 eligible claims under Chapter 110, Civil Practice and Remedies 1-49 Code. 1-50 (d) The elections provided herein shall not affect the right 1-51 of a self-insurance trust created under Article 21.49-4 of this 1-52 code from seeking indemnification for eligible claims. 1-53 (e) The provisions of Article 21.46 of this code shall not 1-54 apply to the credits authorized herein. 1-55 SECTION 2. This Act takes effect September 1, 1997. 1-56 SECTION 3. The importance of this legislation and the 1-57 crowded condition of the calendars in both houses create an 1-58 emergency and an imperative public necessity that the 1-59 constitutional rule requiring bills to be read on three several 1-60 days in each house be suspended, and this rule is hereby suspended, 1-61 and that this Act take effect and be in force from and after its 1-62 passage, and it is so enacted. 1-63 * * * * *