SRC-JBJ H.B. 1627 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 1627
76R5053 PB-DBy: Maxey (Cain)
Economic Development
5/13/1999
Engrossed


DIGEST 

Currently, some insurers "qualify" their bids to a city or municipality,
which means that such insurers can modify their rates or limit coverage to
certain employees or dependants after the city accepts the bid. H.B. 1627
would require bids by stop-loss insurers to contain no qualifications that
would permit the insurers to modify or limit terms of insurance after the
contract is made.  This bill would also prohibit exclusion or assignment of
a higher deductible to individual city employees by insurers. 

PURPOSE

As proposed, H.B. 1627 amends insurer requirements for contracts with
municipalities. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 21E, Insurance Code, by adding Article 21.49-16,
as follows: 

Article 21.49-16.  BID REQUIREMENTS FOR INSURERS WHO CONTRACT WITH
MUNICIPALITIES 

Sec. 1.  DEFINITIONS.  Defines "insurer" and "municipality."

Sec 2.  REQUIREMENTS.  Prohibits an insurer who bids on a contract subject
to the competitive bidding and competitive proposal requirements adopted
under Section 252.021, Local Government Code  (Competitive Bidding and
Competitive Proposal Requirements), from submitting a bid for a contract,
subject to any qualification imposed by the insurer,  that permits the
insurer to modify or limit the terms of insurance coverage to be provided
after the contract has been made.  Requires an insurer's bid submitted
under Section 252.021, Local Government Code, to contain the offer made by
the insurer.  Prohibits an insurer who provides stop-loss or other
insurance coverage for health benefits under a contract subject to this
article from excluding an individual who is otherwise eligible from
coverage or assigning a higher deductible, based on the individual's prior
medical history. 

SECTION 2.  Makes application of this Act prospective.

SECTION 3.  Effective date: September 1, 1999.

SECTION 4.  Emergency clause.