SRC-ARR S.B. 445 76(R)BILL ANALYSIS Senate Research CenterS.B. 445 By: Moncrief Health Services 8/5/1999 Enrolled DIGEST Currently, Texas law does not provide for a child health plan for certain low-income children. The lack of health insurance contributes to poor health and reduces the quality of life for children. Uninsured children are less likely to receive health care when they are sick than children who have some kind of health insurance, and are less likely to receive medical care from a physician even when they need it. S.B. 445 creates the Texas Children's Health Insurance Program (CHIP), a heath plan for certain low-income children. PURPOSE As enrolled, S.B. 445 creates a child health plan for certain low-income children. RULEMAKING AUTHORITY Rulemaking authority is granted to the Health and Human Services Commission in SECTION 1 (Sections 62.051(d), 62.052(b), and 62.053(c), Health and Safety Code); to the Texas Department of Health in SECTION 1 (Sections 62.051(d) and 62.052(b), Health and Safety Code); to the Texas Department of Human Services in SECTION 1 (Section 62.051(d), Health and Safety Code); to any health and human services agency in SECTION 1 (Section 62.051(d), Health and Safety Code); and to the Texas Department of Insurance in SECTION 1 (Section 62.054(c), Chapter 62B, Health and Safety Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Title 2C, Health and Safety Code, by adding Chapter 62, as follows: CHAPTER 62. CHILD HEALTH PLAN FOR CERTAIN LOW-INCOME CHILDREN SUBCHAPTER A. GENERAL PROVISIONS Sec. 62.001. OBJECTIVE OF THE STATE CHILD HEALTH PLAN. Sets forth the objective of the child health plan. Sec. 62.002. DEFINITIONS. Defines "commission," "commissioner," "health plan provider," and "net family income." Sec. 62.003. NOT AN ENTITLEMENT; TERMINATION OF PROGRAM. Provides that this chapter does not establish an entitlement to assistance in obtaining heath benefits for a child. Provides that the program established under this chapter terminates at the time that federal funding terminates under Title XXI of the Social Security Act, as amended, unless a successor program providing federal funding for a state-designed child plan program is created. Provides that the program terminates on the date that money obtained by the state as a result of a certain agreement, unless the legislature authorizes the expenditure of other revenue for the program established under this chapter. Sec. 62.004. FEDERAL LAW AND REGULATIONS. Sets forth certain provisions regarding federal law and regulations. SUBCHAPTER B. ADMINISTRATION OF CHILD HEALTH PLAN PROGRAM Sec. 62.051. DUTIES OF COMMISSION. Requires the Health and Human Services Commission (commission) to develop a state-designed child health plan program (program) to obtain heath benefits coverage for children in low-income families. Requires the commission to ensure that the program is designed and administered in a manner that qualifies it for federal funding. Provides that the commission is the agency responsible for making policy for the child health plan program, including policy related to covered benefits provided under the child health plan. Prohibits the commission from delegating this duty to another agency or entity. Requires the commission to oversee the implementation of the program and coordinate the activities of each agency necessary to the implementation of the program, including certain departments. Authorizes the commission to adopt rules as necessary to implement this chapter. Authorizes the commission to require certain departments or any other health and human services agency to adopt, with the approval of the commission, any rules that may be adopted under this subsection. Authorizes the commission to delegate to certain agencies the authority to adopt any rules that may be adopted under this subsection. Authorizes the commission to delegate to that agency the authority to adopt, with the approval of the commission, any rules that may be necessary to implement the program, with the consent of another agency including the Texas Department of Insurance. Requires the commission to conduct a review of each entity that enters into a contract under Section 62.055 or Section 62.155, to ensure that the entity is available, prepared, and able to fulfill the entity's obligation under the contract in compliance with the contract, this chapter, and rules adopted under this chapter. Requires the commission to ensure that the amounts spent for administration of the child health plan program do not exceed any limit on those expenditures imposed by federal law. Sec. 62.052. DUTIES OF TEXAS DEPARTMENT OF HEALTH. Authorizes the commission to direct the Texas Department of Health (TDH) to implement contracts and monitor child health plan (plan) providers and certain services. Authorizes the commission, or TDH under the direction of and in consultation with the commission, to adopt rules as necessary to implement this section. Sec. 62.053. DUTIES OF TEXAS DEPARTMENT OF HUMAN SERVICES. Authorizes the Texas Department of Human Services (DHS) to perform certain tasks, under the direction of the commission. Requires DHS, under the direction of the commission, to perform certain tasks if the commission contracts with a third party administrator. Requires the commission or DHS, in consultation with the commission, to adopt rules as necessary to implement this section. Sec. 62.054. DUTIES OF TEXAS DEPARTMENT OF INSURANCE. Requires the Texas Department of Insurance (TDI) to provide any necessary assistance with the development of the plan, at the request of the commission. Requires TDI to monitor the quality of the services provided by health benefit plan providers and resolve grievances relating to the providers. Authorizes the commission and TDI to adopt a memorandum of understanding that addresses the responsibilities of each agency in developing the plan. Requires TDI, in consultation with the commission, to adopt rules as necessary to implement this section. Sec. 62.055. CONTRACTS FOR IMPLEMENTATION OF CHILD HEALTH PLAN. Provides that it is the intent of the legislature that the commission maximize the use of private resources in administering the child health plan created under this chapter. Authorizes the commission to contract with certain persons in administering the plan. Sets forth provisions regarding a readiness review. Authorizes a third party administrator or other entity to perform tasks under the contract that would otherwise be performed by the Texas Department of Health or Texas Department of Human Services under this chapter. Requires the commission to take certain action. Sec. 62.056. COMMUNITY OUTREACH CAMPAIGN; TOLL-FREE HOTLINE. Requires the commission to conduct a community outreach and education campaign (campaign) to provide information relating to the availability of health benefits for children. Requires the commission to conduct the campaign in coordination with the Texas Healthy Kids Corporation in a manner that promotes the goals of both programs and minimizes duplication of effort. Requires the campaign to include a toll-free telephone number through which families may obtain information about health benefits coverage for children. Requires the commission to provide grants to community-based organizations to implement the campaign. Authorizes the commission to direct TDH or DHS to perform all or part of the outreach campaign. Sec. 62.057. REGIONAL ADVISORY COMMITTEES. Sets forth certain requirements for regional advisory committees. Sec. 62.058. FRAUD PREVENTION. Requires the commission to develop and implement rules for the prevention and detection of fraud in the child health plan program. SUBCHAPTER C. ELIGIBILITY FOR COVERAGE UNDER CHILD HEALTH PLAN Sec. 62.101. ELIGIBILITY. Provides that a child is eligible for health benefits coverage under the plan if the child meets certain requirements. Requires the commission to establish an income eligibility level consistent with Title XXI of the Social Security Act and any other applicable law or regulations, and subject to the availability of appropriated money, so that children younger than 19 years of age whose family income is at or below 200 percent of the federal poverty level to be eligible for health benefits coverage. Requires the commissioner of health and human services (commissioner) to evaluate enrollment levels and program impact every six months during the first 12 months of implementation and at least annually thereafter and to submit a finding of fact to the Legislative Budget Board and the Governor's Office of Budget and Planning as to the adequacy of funding and the ability of the program to sustain enrollment at the eligibility levels established by Subsection (b). Requires the commission to take certain actions, in the event that appropriated money is insufficient to sustain enrollment at the authorized eligibility level. Sec. 62.102. CONTINUOUS COVERAGE. Requires the commission to provide that an individual who is determined to be eligible for coverage under the child health plan remains eligible for those benefits until a certain time. Sec. 62.103. APPLICATION FORM AND PROCEDURES. Requires the commission, or DHS at the direction of and in consultation with the commission, to adopt an application form and application procedures for requesting plan coverage under this chapter. Requires the form and procedures to coordinate with forms and procedures under the Medicaid program and forms and procedures used by the Texas Healthy Kids Corporation so that a person may submit a single consolidated application to seek assistance under this chapter or the Medicaid program or from the corporation. Requires the application form to be made available in languages other than English. Authorizes the commission to permit application to be made by mail, over the telephone, or through the Internet. Sec. 62.104. ELIGIBILITY SCREENING AND ENROLLMENT. Requires the commission, or DHS at the direction and in consultation with the commission, to develop eligibility screening and enrollment procedures for children that comply with the requirements of 42 U.S.C. Section 1397bb, as amended, and any other applicable law or regulations. Requires the procedures to ensure that Medicaid-eligible children are identified and referred to the Medicaid program. Authorizes the Texas Integrated Enrollment Services eligibility determination system or a compatible system to be used to screen and enroll children under the plan. Requires the eligibility screening and enrollment procedures to ensure that children who appear to be Medicaid-eligible are identified and that their families are assisted in applying for Medicaid coverage. Requires children who are denied enrollment to be enrolled in the health plan without further application or qualification. Requires the commission to report semi-annually to the committees of both houses of the legislature with jurisdiction over the child health plan the numbers of individuals referred and denied for Medicaid coverage. Sets forth requirements for a determination of whether a child is eligible for coverage. Sec. 62.105. COVERAGE FOR QUALIFIED ALIENS. Sets forth provisions regarding coverage for qualified aliens. SUBCHAPTER D. CHILD HEALTH PLAN Sec. 62.151. CHILD HEALTH PLAN COVERAGE. Requires the plan to comply with this chapter and the coverage requirements prescribed by 42 U.S.C. Section 1397cc, as amended, and any other applicable law or regulations. Requires the commission to consider the health care needs of certain children. Requires the commission to consider the health benefit plans providing coverage to state employees under the Texas Employees Uniform Group Insurance Benefits Act and may use a health benefit plan providing coverage under that article as a model for the plan. Authorizes the benefits offered under the child health plan to vary from the benefits offered state employees. Requires the plan to allow an enrolled child with a chronic, disabling, or life-threatening illness to select an appropriate specialist as a primary care physician. Sec. 62.152. APPLICATION OF INSURANCE LAW. Provides that, to provide the flexibility necessary to satisfy the requirements of Title XXI of the Social Security Act, as amended, and any other applicable law or regulations, the plan is not subject to a law that requires certain coverage. Sec. 62.153. COST SHARING. Authorizes the commission to require enrollees to share the cost of the plan, including provisions requiring enrollees under the plan to pay certain costs. Requires cost-sharing provisions adopted under this section to ensure that families with higher levels of income are required to pay progressively higher percentages of the cost of the plan. Authorizes the commission to specify the manner in which the premiums are to be paid, if cost-sharing provisions imposed under Subsection (a) include requirements that enrollees pay a portion of the plan premium. Authorizes the commission to require that the premium be paid to TDH, DHS, or the child health plan provider. Sec. 62.154. CROWD OUT. Provides that, to the extent permitted under Title XXI of the Social Security Act, as amended, and any other applicable law or regulations, the plan may include waiting periods, copayments, and other provisions to discourage certain acts. Provides that a child is not subject to a waiting period adopted under Subsection (a) if certain criteria apply. Authorizes a child described by Subsection (b) to enroll in the child health plan program at any time, without regard to any open enrollment period established under the enrollment procedures. Requires the waiting period required by Subsection (a) to meet certain criteria. Sec. 62.155. HEALTH PLAN PROVIDERS. Requires the commission or TDH, at the direction of and in consultation with the commission, to select the plan providers under the program through open enrollment or a competitive bid process. Requires a plan provider to meet certain requirements. Authorizes the commissioner to make exceptions if there is only one acceptable applicant as a provider in a metropolitan area. Sec. 62.156. HEALTH CARE PROVIDERS. Requires health care providers who provide health care services under the child health plan to satisfy certification and license requirements, as required by the commission, consistent with law. CHAPTER 63. HEALTH BENEFITS PLAN FOR CERTAIN CHILDREN Sec. 63.001. DEFINITION. Defines "commission." Sec. 63.002. NOT AN ENTITLEMENT. Provides that this chapter does not establish an entitlement to assistance in obtaining health benefits for a child. Sec. 63.003. HEALTH BENEFITS PLAN COVERAGE FOR CERTAIN CHILDREN. Sets forth a health benefits plan coverage for certain children. Sec. 63.004. BENEFITS COVERAGE REQUIRED. Requires the program required by Section 63.003 to provide benefits comparable to the benefits provided under the child health plan program under Chapter 62, to the extent possible. Sec. 63.005. HEALTH BENEFITS PLAN PROVIDER. Requires a health benefit plan provider to take certain action. Provides that a health benefits plan provider under this chapter is not subject to a law that requires coverage or the offer of coverage of a health care service or benefit. Sec. 63.006. COST-SHARING PAYMENTS. Sets forth provisions for cost sharing payments. Sec. 63.007. DISALLOWANCE OF MATCHING FUNDS FROM FEDERAL GOVERNMENT. Prohibits expenditures made to provide health benefits plan coverage under this section from being included for the purpose of determining the state children's health insurance expenditures, as that term is defined by 42 U.S.C. Section 1397ee(d) (2) (B), as amended. SECTION 2. Amends Chapter 109, Health and Safety Code, by adding Subchapter F, as follows: SUBCHAPTER F. STATE CHILD HEALTH PLAN Sec. 109.201. DEFINITIONS. Defines "commission" and "state child health plan." Sec. 109.202. CHILD HEALTH PLAN COVERAGE. Authorizes the commission to use appropriate funds, in accordance with the General Appropriations Act, to purchase coverage under the state child health plan and to contract with the Texas Healthy Kids Corporation (corporation) for other services under this subchapter. Requires the state plan coverage offered under this subchapter to be approved by the commission. Requires the commission to ensure that coverage provided under this subchapter complies with Chapter 62. Sec. 109.203. ELIGIBILITY. Provides that, notwithstanding any other provision of this chapter or the eligibility criteria established under Section 109.061, an individual who is eligible for coverage under the state plan, as determined by the commission, is eligible for coverage provided through the corporation under this subchapter. Sec. 109.204. COMMUNITY OUTREACH; ELIGIBILITY SCREENING. Authorizes the corporation, under direction of the commission, in connection with offering a plan under this subchapter, to take certain action. Requires the eligibility screening and enrollment procedures used by the corporation to comply with Chapter 62. Sec. 109.205. COMPETITIVE PROCUREMENT. Requires the corporation to use a competitive procurement process, satisfactory to the commission, to ensure that the state receives the best value with respect to certain items, if the corporation is selected to offer state child health plan coverage under this subchapter and subsequently as required by the commission procurement process. Sec. 109.206. REPORTING AND ACCOUNTABILITY. Requires the corporation to report to the commission as required by the commission or the agency designate under Section 62.055(c) with respect to coverage and services under this subchapter. SECTION 3. Amends Section 4, Article 3.51-6, Insurance Code, as follows: Sec. 4. EXEMPTIONS. Prohibits the provisions of this article from being applicable to any policy or contract of insurance with a state agency, department, or board providing health services to eligible persons under Chapter 32, Human Resources Code, or in accordance with 42 U.S.C. Sections 1396-1396g, or 42 U.S.C. Section 1397aa et seq., as amended, under a state plan. Makes standard recodification and conforming changes. SECTION 4. Requires the Health and Human Service Commission, by September 1, 1999, to develop the plan and a plan amendment. SECTION 5. Requires the commission to ensure that, consistent with federal law and Chapter 62, Health and Human Services Code, as added by this Act, the aggregate amount of general revenue spent for the administration during the first 24 months of operation of the child health plan program is matched with federal funds, notwithstanding Section 62.051(f). SECTION 6. Provides that if the Health and Human Services Commission determines that a waiver of authorization from a federal agency is necessary for implementation of that provision, the commission shall request the waiver or authorization and may delay implementing that provision until the waiver of authorization is granted. SECTION 7. Requires money from the tobacco settlement to be used to fund the child health plan program established by this state under Title XXI of the Social Security Act, as amended. SECTION 8. Requires certain standing committees of the legislature to take certain action. SECTION 9. Requires the commission to establish and implement the health plan coverage programs required by Chapter 63, Health and Safety Code, as added by this Act, not later than September 1, 2000. Authorize the commission to delay implementation of the health benefits plan coverage program until a plan amendment relating to the child health plan under 42 U.S.C. Section 1397ff, as amended, is approved. SECTION 10. Requires the state to provide coverage under the state Medicaid program or under a program established under Title XXI of the Social Security Ac, to a child described by Section 63.003, Health and Safety Code, as added by this Act, if the federal government authorizes the state to provide that coverage. Requires the commission or any other agency to comply with any prerequisites under the federal law in providing the coverage. SECTION 11.Emergency clause. Effective date: upon passage.