By Denny                                               H.B. No. 975
         76R2673 PB-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to group health benefits coverage for employees of school
 1-3     districts.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Sections 2(2) and (5), Article 3.50-4, Insurance
 1-6     Code, are amended to read as follows:
 1-7                 (2)  "Carrier" means:
 1-8                       (A)  an [any] insurance company authorized to do
 1-9     business in this state;
1-10                       (B)  a group [or] hospital service corporation
1-11     created under Chapter 20 of this code; [authorized by the State
1-12     Board of Insurance to provide any of the insurance coverages,
1-13     benefits,] or
1-14                       (C)  a health maintenance organization regulated
1-15     under the Texas Health Maintenance Organization Act (Chapter 20A,
1-16     Vernon's Texas Insurance Code) [services provided by this article
1-17     under the insurance laws of this state].
1-18                 (5)  "Health benefit plan" or "plan" means a group
1-19     insurance policy, contract, or certificate, medical or hospital
1-20     service agreement, membership or subscription contract, salary
1-21     continuation plan, or similar group arrangement, including coverage
1-22     through a health maintenance organization regulated under the Texas
1-23     Health Maintenance Organization Act (Chapter 20A, Vernon's Texas
1-24     Insurance Code), to provide, pay for, or reimburse expenses for
 2-1     health care services.
 2-2           SECTION 2.  Section 3(a), Article 3.50-4, Insurance Code, is
 2-3     amended to read as follows:
 2-4           (a)  The Texas Public School Employees Group Insurance
 2-5     Program is established to provide for a health benefit [an
 2-6     insurance] plan or plans under this article and may provide other
 2-7     insurance coverages as provided by this article.
 2-8           SECTION 3.  Section 5(a), Article 3.50-4, Insurance Code, is
 2-9     amended to read as follows:
2-10           (a)  The trustee may adopt rules, plans, procedures, and
2-11     orders reasonably necessary to implement this article, including:
2-12                 (1)  establishment of minimum benefit and financing
2-13     standards for group health benefits [insurance] coverage and other
2-14     coverage to be provided to all retirees, active employees,
2-15     dependents, surviving spouses, and surviving dependent children;
2-16                 (2)  establishment of basic and optional group coverage
2-17     to be provided to retirees, active employees, dependents, surviving
2-18     spouses, and surviving dependent children;
2-19                 (3)  establishment of the procedures for contributions
2-20     and deductions;
2-21                 (4)  establishment of periods for enrollment and
2-22     selection of optional coverage and procedures for enrolling and
2-23     exercising options under the plan;
2-24                 (5)  determination of methods and procedures for claims
2-25     administration;
2-26                 (6)  study of the operation of all [insurance] coverage
2-27     provided under this article;
 3-1                 (7)  administration of the fund;
 3-2                 (8)  adoption of a timetable for the development of
 3-3     minimum benefit and financial standards for group [insurance]
 3-4     coverage, establishment of group health benefit plans and other
 3-5     insurance plans, and the taking of bids for and awarding of
 3-6     contracts for health benefit plans and other insurance plans; and
 3-7                 (9)  contracting with an independent and experienced
 3-8     group insurance consultant or actuary, who does not receive
 3-9     [insurance] commissions from any carrier [insurance company], for
3-10     advice and counsel in implementing and administering this program.
3-11           SECTION 4.  Section 6, Article 3.50-4, Insurance Code, is
3-12     amended by amending Subsections (a), (c), and (f) and by adding
3-13     Subsection (h) to read as follows:
3-14           (a)  There is created a Health Benefits [Retirees] Advisory
3-15     Committee composed of nine members appointed by the trustee.  One
3-16     member shall be an active school administrator.  One member shall
3-17     be a retired school administrator.  Two members shall be active
3-18     teachers.  Three members shall be retired teachers.  One member
3-19     shall be an active member of the auxiliary personnel of a school
3-20     district.  One member shall be a retired member of the auxiliary
3-21     personnel.
3-22           (c)  The committee shall:
3-23                 (1)  hold public hearings on group health and other
3-24     insurance benefits;
3-25                 (2)  recommend to the trustee minimum standards and
3-26     features of the plan or plans that it considers appropriate; and
3-27                 (3)  recommend to the trustee desirable changes in
 4-1     rules and legislation affecting the program.
 4-2           (f)  A person is not eligible for appointment as a member of
 4-3     the advisory committee if the person is required to register with
 4-4     the secretary of state under Chapter 305, Government Code [422,
 4-5     Acts of the 63rd Legislature, Regular Session, 1973 (Article
 4-6     6252-9c, Vernon's Texas Civil Statutes)].
 4-7           (h)  The advisory committee is not subject to Section
 4-8     2110.008, Government Code.
 4-9           SECTION 5.  The heading to Section 7, Article 3.50-4,
4-10     Insurance Code, is amended to read as follows:
4-11           Sec. 7.  PARTICIPATION BY RETIREE.
4-12           SECTION 6.  Section 7A, Article 3.50-4, Insurance Code, is
4-13     amended to read as follows:
4-14           Sec. 7A.  PARTICIPATION BY ACTIVE EMPLOYEES.  (a)  Each [A]
4-15     public school district shall [may elect to] participate in the
4-16     program provided under this article.  The [A] district [that elects
4-17     to participate] must accept the schedule of costs adopted by the
4-18     trustee.  [A district may offer an alternative health benefit plan
4-19     to its active employees during the period of its participation in
4-20     the program if the trustee approves the plan as providing
4-21     contributions, participation, and a design that are in accordance
4-22     with sound group benefit underwriting principles.]
4-23           (b)  The trustee by rule shall establish [provide]:
4-24                 (1)  minimum benefit standards for the program
4-25     [eligibility requirements for participation by a school district,
4-26     which may include criteria based on size];
4-27                 (2)  [restrictions on the ability of a school district
 5-1     to begin or discontinue participation, which may include a minimum
 5-2     period of participation and limited periods for elections to begin
 5-3     or discontinue participation;]
 5-4                 [(3)]  administrative fees to be paid by
 5-5     [participating] school districts to cover the trustee's
 5-6     administrative costs in extending the program to active employees;
 5-7     and
 5-8                 (3)  other participation [(4)] requirements for school
 5-9     districts as determined by the trustee to be necessary for the
5-10     operation of [minimize the effects of adverse selection on] the
5-11     program.
5-12           (c)  The trustee shall provide basic group health benefits
5-13     coverage for each active employee and may provide optional group
5-14     coverages for active employees participating in the program.  The
5-15     coverages may be combined with or similar to, but separate from,
5-16     coverages provided to retirees.  The trustee by rule shall define
5-17     the requirements of the basic coverage [sum of premiums and
5-18     administrative fees received from participating school districts
5-19     and active employees must cover all expenses of school district
5-20     employee participation in the program].
5-21           (d)  Each [Participation by an] active employee of a
5-22     [participating] school district shall participate in the basic
5-23     coverage unless [is optional with] the employee specifically waives
5-24     participation in writing.  A school district may not offer a
5-25     financial incentive to an active employee for declining to
5-26     participate in the program.  An active employee is entitled to
5-27     obtain coverage for dependents in the same manner as a
 6-1     participating retiree.
 6-2           (e)  Each [participating] school district shall contribute
 6-3     for each district employee covered by the program an amount equal
 6-4     to 65 [not less than 75] percent of the cost for the employee only
 6-5     of the plans of group coverages authorized by the trustee for
 6-6     active employees.  [The district shall certify to the trustee the
 6-7     amount the district will contribute monthly toward the cost of
 6-8     coverage.  The trustee shall determine if the amount is sufficient
 6-9     to underwrite the plan for the district based on sound group
6-10     benefit underwriting principles.  A determination by the trustee
6-11     under this subsection is final.]
6-12           (f)  Each active employee covered by the program shall pay,
6-13     through a deduction from the employee's compensation:
6-14                 (1)  an amount equal to 25 percent of the cost for
6-15     employee-only coverage under the plan of basic coverage authorized
6-16     by the trustee for active employees; and
6-17                 (2)  that portion of the cost of optional coverage or
6-18     dependent coverage selected by the employee that exceeds the amount
6-19     required  under Subdivision (1) of this subsection [of employer
6-20     contributions].
6-21           (g)  [The trustee shall deposit in the fund all fees
6-22     collected under Section 44(d), Chapter 812, Acts of the 73rd
6-23     Legislature, 1993, except that portion used to conduct the survey
6-24     required by Section 44.  The trustee shall continue to collect the
6-25     fee through the 1996-1997 school year, after which time the fee
6-26     expires.]
6-27           [(h)]  The state shall, for each active employee covered by
 7-1     the program, contribute in the manner provided by Section 16 of
 7-2     this article an amount equal to 10 percent of the cost for
 7-3     employee-only coverage under the plan of basic coverage authorized
 7-4     by the trustee for active employees.  The state may also make
 7-5     contributions to the fund in addition to those required by Section
 7-6     16(b) of this article for the purpose of assisting in the expansion
 7-7     of the program to active employees.
 7-8           [(i) The trustee shall begin enrollment in the program for
 7-9     active employees to be effective beginning with the 1996-1997
7-10     school year.]
7-11           SECTION 7.  Section 9, Article 3.50-4, Insurance Code, is
7-12     amended to read as follows:
7-13           Sec. 9.  BENEFIT CERTIFICATES.  At such times, or upon such
7-14     events, as designated by the trustee, each insurance carrier shall
7-15     issue to each retiree, active employee, surviving spouse, or
7-16     surviving dependent child entitled to coverage [insured] under this
7-17     article a certificate of benefits [insurance] that:
7-18                 (1)  states the benefits to which the person is
7-19     entitled;
7-20                 (2)  states to whom the benefits are payable;
7-21                 (3)  states to whom the claims must be submitted; and
7-22                 (4)  summarizes the provisions of the health benefit
7-23     plan [policy] principally affecting the person.
7-24           SECTION 8.  Sections 10(a) and (b), Article 3.50-4, Insurance
7-25     Code, are amended to read as follows:
7-26           (a)  Not later than the 180th day after the end of each state
7-27     fiscal year, the trustee shall make a written report to the
 8-1     commissioner [State Board of Insurance] concerning the [insurance]
 8-2     coverages provided and the benefits and services being received by
 8-3     persons covered [insured] under this article.
 8-4           (b)  Coverage [Insurance coverage] purchased under this
 8-5     article shall provide for an accounting to the trustee by each
 8-6     carrier providing coverage not later than the 90th day after the
 8-7     end of each policy year.  The accounting shall be on a form
 8-8     approved by the trustee.  Other reports shall be prepared by each
 8-9     carrier if considered necessary by the trustee.  An extra charge
8-10     may not be assessed by the carrier for the accounting reports.
8-11           SECTION 9.  Section 13, Article 3.50-4, Insurance Code, is
8-12     amended to read as follows:
8-13           Sec. 13.  AUTOMATIC COVERAGE.  A retiree or active employee
8-14     who applies during an enrollment period may not be denied any of
8-15     the [group insurance] basic coverage provided under this article
8-16     unless the person has been found under Section 18A of this article
8-17     to have defrauded or attempted to defraud the Texas Public School
8-18     Employees Group Insurance Program.
8-19           SECTION 10.  Section 15(a), Article 3.50-4, Insurance Code,
8-20     is amended to read as follows:
8-21           (a)  The school employees group insurance fund is created.
8-22     The comptroller is the custodian of the fund, and the trustee shall
8-23     administer the fund.  All contributions from active employees,
8-24     retirees, school districts, and the state, contributions for
8-25     optional coverages, investment income, appropriations for
8-26     implementation of this program, and other money required or
8-27     authorized to be paid into the fund shall be paid into the fund.
 9-1     From the fund shall be paid, without state fiscal year limitation,
 9-2     the appropriate premiums to the carrier or carriers providing group
 9-3     coverage under the plan or plans under this article, claims for
 9-4     benefits under the group coverage, and the amounts expended by the
 9-5     trustee for administration of the program.  The appropriate portion
 9-6     of the contributions to the fund to provide for incurred but
 9-7     unreported claim reserves and contingency reserves, as determined
 9-8     by the trustee, shall be retained in the fund.
 9-9            SECTION 11.  Sections 16(a), (b), (c), (f), (g), (h), and
9-10     (i), Article 3.50-4, Insurance Code, are amended to read as
9-11     follows:
9-12           (a)  For [the state fiscal year beginning September 1, 1985,
9-13     and for] each [subsequent] state fiscal year, each active employee,
9-14     as a condition of employment, shall contribute to the fund an
9-15     amount equal to .25 percent of the employee's salary.  Each month
9-16     the employer of an active employee shall deduct the contributions
9-17     from the employee's salary and shall remit the contributions to the
9-18     trustee as provided by any procedures that the trustee may require.
9-19     In lieu of deducting the contributions from salaries, an employer
9-20     may assume and pay the total contributions due from its active
9-21     employees for any month.
9-22           (b)  The state shall contribute as the state's contribution
9-23     for coverage for retirees to the fund each fiscal year an amount
9-24     equal to .50 percent of the salary of each active employee.  The
9-25     state may contribute amounts in addition to the contribution
9-26     required by this subsection.
9-27           (c)  If [after the state fiscal year beginning September 1,
 10-1    1990,] the amount of state and active employee contributions to the
 10-2    fund is raised by the legislature above the percentages provided by
 10-3    Subsections (a)  and (b) of this section to provide adequate
 10-4    funding for the program, the ratio between the state's contribution
 10-5    and the active employees' contributions must be maintained at two
 10-6    to one.
 10-7          (f)  Before the first day of November preceding each regular
 10-8    session of the legislature, the trustee shall certify, for
 10-9    information and review, to the Legislative Budget Board and the
10-10    budget division of the governor's office the amounts necessary to
10-11    pay the contributions of the state to the fund for the basic group
10-12    health benefit plans for active employees and retirees under this
10-13    article [for information and review].  Not later than August 31 of
10-14    each year, the trustee shall certify to the comptroller of public
10-15    accounts the estimated amount of state contributions to be received
10-16    by the fund for the next fiscal year under the appropriations
10-17    authorized by this article.
10-18          (g)  Contributions allocated and appropriated under this
10-19    article [section] shall be paid from the General Revenue Fund in
10-20    equal monthly installments, based on the annual estimate certified
10-21    by the trustee to the comptroller of public accounts for that year,
10-22    and subject to any express limitations specified in the Act making
10-23    the appropriation.  Variations between the certified amount and the
10-24    actual amount due for the year shall be reconciled at the close of
10-25    the fiscal year and proper adjustments in the annual contributions
10-26    to the fund shall be made.
10-27          (h)  An employing district that fails to remit, before the
 11-1    11th day after the last day of the month, all [member] deposits
 11-2    required by this article [section] to be remitted by the district
 11-3    for the month shall pay to the [Texas public school retired
 11-4    employees group insurance] fund, in addition to the deposits,
 11-5    interest on the unpaid amounts at the annual rate of six percent
 11-6    compounded monthly.
 11-7          (i)  An employing district and its trustees hold amounts due
 11-8    to the [Texas public school retired employees group insurance] fund
 11-9    under this article in trust for the fund and its participants and
11-10    may not divert the amounts for any other purpose.
11-11          SECTION 12.  Section 17(a), Article 3.50-4, Insurance Code,
11-12    is amended to read as follows:
11-13          (a)  The trustee shall study the operation and administration
11-14    of this article, including surveys and reports on financing group
11-15    insurance coverages and health benefits plans available to active
11-16    employees and retirees, and the experience and projected cost of
11-17    coverage and  benefits.  The trustee shall make a report to the
11-18    legislature at each regular legislative session relating to the
11-19    operation and administration of this article.
11-20          SECTION 13.  Section 19, Article 3.50-4, Insurance Code, is
11-21    amended to read as follows:
11-22          Sec. 19.  ASSISTANCE.  In implementing and administering this
11-23    article, the commissioner [State Board of Insurance], as requested
11-24    by the trustee, shall assist the trustee in carrying out this
11-25    article.
11-26          SECTION 14.  Article 3.51, Insurance Code, is amended to read
11-27    as follows:
 12-1          Art. 3.51.  GROUP INSURANCE FOR EMPLOYEES OF STATE AND ITS
 12-2    SUBDIVISIONS AND COLLEGES [COLLEGE AND SCHOOL EMPLOYEES]
 12-3          Sec. 1.  (a)  The State of Texas and each of its political,
 12-4    governmental and administrative subdivisions, departments,
 12-5    agencies, associations of public employees, and the governing
 12-6    boards and authorities of each state university or college[,
 12-7    colleges, common and independent school districts or of any other
 12-8    agency or subdivision of the public school system of the State of
 12-9    Texas] are authorized to procure contracts with any insurance
12-10    company authorized to do business in this state insuring their
12-11    respective employees, or if an association of public employees is
12-12    the policyholder, insuring its respective members, or any class or
12-13    classes thereof under a policy or policies of group health,
12-14    accident, accidental death and dismemberment, disability income
12-15    replacement and hospital, surgical and/or medical expense insurance
12-16    or a group contract providing for annuities.  The dependents of any
12-17    such employees or association members, as the case may be, may be
12-18    insured under group policies which provide hospital, surgical
12-19    and/or medical expense insurance.  The insureds' contributions to
12-20    the premiums for such insurance or annuities issued to the employer
12-21    or to an association of public employees as the policyholder may be
12-22    deducted by the employer from the insureds' salaries when
12-23    authorized in writing by the respective employees so to do.  The
12-24    premium for the policy or contract may be paid in whole or in part
12-25    from funds contributed by the employer or in whole or in part from
12-26    funds contributed by the insured employees.  When an association of
12-27    public employees is the holder of such a policy of insurance or
 13-1    contract, the premium for employees that are members of such
 13-2    association may be paid in whole or in part by the State of Texas
 13-3    or other agency authorized to procure contracts or policies of
 13-4    insurance under this section, or in whole or in part from funds
 13-5    contributed by the insured employees that are members of such
 13-6    association;  provided, however, that any monies or credits
 13-7    received by or allowed to the policyholder or contract holder
 13-8    pursuant to any participation agreement contained in or issued in
 13-9    connection with the policy or contract shall be applied to the
13-10    payment of future premiums and to the pro rata abatement of the
13-11    insured employee's contribution therefor.
13-12          (b)  The term employees as used herein in addition to its
13-13    usual meaning shall include elective and appointive officials of
13-14    the state.
13-15          [(b)  Independent School Districts procuring policies
13-16    insuring their employees under this Section may pay all or any
13-17    portion of the premiums on such policies from the local funds of
13-18    such Independent School District, but in no event shall any part of
13-19    such premiums be paid from funds paid such districts by the State
13-20    of Texas.]
13-21          Sec. 2.  All group insurance contracts effected pursuant
13-22    hereto shall conform and be subject to all the provisions of any
13-23    existing or future laws concerning group insurance.
13-24          SECTION 15.  Section 1, Chapter 123, Acts of the 60th
13-25    Legislature, Regular Session, 1967 (Article 3.51-3, Vernon's Texas
13-26    Insurance Code), is amended to read as follows:
13-27          Sec. 1.  (a)  This Act applies to a [Any] voluntary
 14-1    association [of school administrators and/or teachers in public
 14-2    and/or private schools, colleges or universities, which association
 14-3    is] organized on a non-profit membership basis and [is]
 14-4    incorporated under the laws of the United States or of this state
 14-5    that is composed of teachers or administrators in public or
 14-6    private:
 14-7                (1)  elementary or secondary schools; or
 14-8                (2)  colleges or universities.
 14-9          (b)  An association subject to this Act may[, is hereby
14-10    authorized to] procure contracts of insurance.  An association
14-11    described by Subsection (a)(1) of this Act may cover its employees
14-12    [covering any class or classes of its membership] and their
14-13    dependents under a policy or policies of group life, health,
14-14    accident, accidental death or dismemberment, and hospital, surgical
14-15    or [and/or] medical expense insurance.  An association described by
14-16    Subsection (a)(2) of this Act may cover any class or classes of its
14-17    membership under such a policy. An[; and any] insurance company
14-18    authorized to do business in this state is hereby authorized to
14-19    issue such policies to any such association under the terms and
14-20    conditions set out in this Act, any contrary or inconsistent
14-21    provisions in any other statute notwithstanding.
14-22          (c)  Separate policies may be obtained for one or more of the
14-23    aforementioned risks, and the association shall be deemed the
14-24    policyholder.  The premium for the policy shall be paid by the
14-25    policyholder either wholly or partly from the association's funds,
14-26    or partly from such funds and partly from funds contributed by
14-27    insured members, or from funds wholly contributed by the insured
 15-1    members.
 15-2          (d)  The policy must cover at least twenty-five members at
 15-3    date of issue, and if any part or all of the premiums are to be
 15-4    derived from funds contributed by the insured members specifically
 15-5    for their insurance, the policy may be placed in force only if at
 15-6    least seventy-five per centum (75%) of the then eligible members or
 15-7    a minimum of four hundred members (whichever is less, and excluding
 15-8    any as to whom evidence of individual insurability is not
 15-9    satisfactory to the insurer) elect to make the required
15-10    contributions and become insured thereunder.
15-11          (e)  The amounts of insurance under the policy must be based
15-12    on some plan precluding individual selection either by the insured
15-13    members or by the association.
15-14          SECTION 16.  Section 22.004, Education Code, is amended to
15-15    read as follows:
15-16          Sec. 22.004.  GROUP HEALTH BENEFITS FOR SCHOOL EMPLOYEES.
15-17    (a)  Each district shall participate in the [make available to its
15-18    employees] group health benefits program [coverage] provided under
15-19    [by a risk pool established by one or more school districts under
15-20    Chapter 172, Local Government Code, or under a policy of insurance
15-21    or group contract issued by an insurer, a company subject to
15-22    Chapter 20, Insurance Code, or a health maintenance organization
15-23    under the Texas Health Maintenance Organization Act (Chapter 20A,
15-24    Vernon's Texas Insurance Code).  The coverage must meet the
15-25    substantive coverage requirements of] Article 3.50-4 [3.51-6],
15-26    Insurance Code[, and any other law applicable to group health
15-27    insurance policies or contracts issued in this state].  [The
 16-1    coverage must include major medical treatment but may exclude
 16-2    experimental procedures.  In this subsection, "major medical
 16-3    treatment" means a medical, surgical, or diagnostic procedure for
 16-4    illness or injury. The coverage may include managed care or
 16-5    preventive care and must be comparable to the basic health coverage
 16-6    provided under the Texas Employees Uniform Group Insurance Benefits
 16-7    Act (Article 3.50-2, Vernon's Texas Insurance Code).  The board of
 16-8    trustees of the Teacher Retirement System of Texas shall adopt
 16-9    rules to determine whether a school district's group health
16-10    coverage is comparable to the basic health coverage specified by
16-11    this subsection.  The rules must provide for consideration of the
16-12    following factors concerning the district's coverage in determining
16-13    whether the district's coverage is comparable to the basic health
16-14    coverage specified by this subsection:]
16-15                [(1)  the deductible amount for service provided inside
16-16    and outside of the network;]
16-17                [(2)  the coinsurance percentages for service provided
16-18    inside and outside of the network;]
16-19                [(3)  the maximum amount of coinsurance payments a
16-20    covered person is required to pay;]
16-21                [(4)  the amount of the copayment for an office visit;]
16-22                [(5)  the schedule of benefits and the scope of
16-23    coverage;]
16-24                [(6)  the lifetime maximum benefit amount; and]
16-25                [(7)  verification that the coverage is issued by a
16-26    provider licensed to do business in this state by the Texas
16-27    Department of Insurance or is provided by a risk pool authorized
 17-1    under Chapter 172, Local Government Code, or that a district is
 17-2    capable of covering the assumed liabilities in the case of coverage
 17-3    provided through district self-insurance.]
 17-4          (b)  The cost of the coverage shall [may] be shared by the
 17-5    employees, [and] the district, and the state in the manner provided
 17-6    by Section 7A, Article 3.50-4, Insurance Code.
 17-7          (c)  Each district shall report the district's compliance
 17-8    with this section [subsection] to the executive director of the
 17-9    Teacher Retirement System of Texas not later than November 1 of
17-10    each year in the manner required by the board of trustees of the
17-11    Teacher Retirement System of Texas.  The report [must be based on
17-12    the district group health coverage plan in effect on November 1
17-13    and] must include:
17-14                (1)  [appropriate documentation of:]
17-15                      [(A)  the district's contract for group health
17-16    coverage with a provider licensed to do business in this state by
17-17    the Texas Department of Insurance or a risk pool authorized under
17-18    Chapter 172, Local Government Code; or]
17-19                      [(B)  a resolution of the board of trustees of
17-20    the district authorizing a self-insurance plan for district
17-21    employees and of the district's review of district ability to cover
17-22    the liability assumed;]
17-23                [(2)]  the schedule of benefits;
17-24                (2) [(3)]  the premium rate sheet, including the amount
17-25    paid by the district and employee;
17-26                (3) [(4)]  the number of employees covered by the
17-27    program in [each health coverage plan offered by] the district; and
 18-1                (4) [(5)]  any other information considered appropriate
 18-2    by the executive director of the Teacher Retirement System of
 18-3    Texas.
 18-4          [(d)  Based on the criteria prescribed by Subsection (a), the
 18-5    executive director of the Teacher Retirement System of Texas shall
 18-6    certify whether a district's coverage is comparable to the basic
 18-7    health coverage provided under the Texas Employees Uniform Group
 18-8    Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
 18-9    Code).  If the executive director of the Teacher Retirement System
18-10    of Texas determines that the group health coverage offered by a
18-11    district is not comparable, the executive director shall report
18-12    that information to the district and to the Legislative Budget
18-13    Board.  The executive director shall submit a report to the
18-14    legislature not later than January 1 of each odd-numbered year
18-15    describing the status of each district's group health coverage
18-16    program based on the information contained in the report required
18-17    by Subsection (c) and the certification required by this
18-18    subsection.]
18-19          [(e)  A school district may not contract with an insurer, a
18-20    company subject to Chapter 20, Insurance Code, or a health
18-21    maintenance organization to issue a policy or contract under this
18-22    section, or with any person to assist the school district in
18-23    obtaining or managing the policy or contract unless, before the
18-24    contract is entered into, the insurer, company, organization, or
18-25    person provides the district with an audited financial statement
18-26    showing the financial condition of the insurer, company,
18-27    organization, or person.]
 19-1          [(f)  An insurer, a company subject to Chapter 20, Insurance
 19-2    Code, or a health maintenance organization that issues a policy or
 19-3    contract under this section and any person that assists the school
 19-4    district in obtaining or managing the policy or contract for
 19-5    compensation shall provide an annual audited financial statement to
 19-6    the school district showing the financial condition of the insurer,
 19-7    company, organization, or person.]
 19-8          [(g)  An audited financial statement provided under this
 19-9    section must be made in accordance with rules adopted by the
19-10    commissioner of insurance or state auditor, as applicable.]
19-11          SECTION 17.  The following laws are repealed:
19-12                (1)  Section 22.005, Education Code; and
19-13                (2)  Sections 20 and 21, Article 3.50-4, Insurance
19-14    Code.
19-15          SECTION 18.  The Teacher Retirement System of Texas shall
19-16    begin enrollment in the group health benefits program for active
19-17    employees  required under Section 7A, Article 3.50-4, Insurance
19-18    Code, as amended by this Act, to be effective beginning with the
19-19    2000-2001 school year.
19-20          SECTION 19.  This Act takes effect September 1, 1999.
19-21          SECTION 20.  The importance of this legislation and the
19-22    crowded condition of the calendars in both houses create an
19-23    emergency and an imperative public necessity that the
19-24    constitutional rule requiring bills to be read on three several
19-25    days in each house be suspended, and this rule is hereby suspended.