1-1 AN ACT 1-2 relating to certain requirements for insurers that contract with 1-3 municipalities. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter E, Chapter 21, Insurance Code, is 1-6 amended by adding Article 21.49-16 to read as follows: 1-7 Art. 21.49-16. BID REQUIREMENTS FOR INSURERS WHO CONTRACT 1-8 WITH MUNICIPALITIES 1-9 Sec. 1. DEFINITIONS. In this article: 1-10 (1) "Insurer" means: 1-11 (A) an insurance company, including a company 1-12 providing stop-loss or excess loss insurance; 1-13 (B) a health maintenance organization operating 1-14 under the Texas Health Maintenance Organization Act (Chapter 20A, 1-15 Vernon's Texas Insurance Code); 1-16 (C) an approved nonprofit health corporation 1-17 that holds a certificate of authority issued by the commissioner 1-18 under Article 21.52F of this code; or 1-19 (D) a third party administrator that holds a 1-20 certificate of authority under Article 21.07-6 of this code. 1-21 (2) "Municipality" has the meaning assigned by Section 1-22 1.005, Local Government Code. 1-23 Sec. 2. REQUIREMENTS. (a) An insurer who bids on a 1-24 contract subject to the competitive bidding and competitive 2-1 proposal requirements adopted under Section 252.021, Local 2-2 Government Code, may not submit a bid for a contract to provide 2-3 stop-loss or other insurance coverage that is subject to any 2-4 qualification imposed by the insurer that permits the insurer to 2-5 modify or limit the terms of insurance coverage to be provided 2-6 after the contract has been made. An insurer's bid submitted under 2-7 Section 252.021, Local Government Code, must contain the entire 2-8 offer made by the insurer. 2-9 (b) An insurer who provides stop-loss or other insurance 2-10 coverage for health benefits under a contract subject to this 2-11 article may not, based on an individual's prior medical history, 2-12 exclude an individual who is otherwise eligible for the health 2-13 benefits coverage from coverage or assign a higher deductible to 2-14 the individual. 2-15 SECTION 2. Article 21.49-16, Insurance Code, as added by 2-16 this Act, applies only to a contract entered into on or after the 2-17 effective date of this Act. A contract entered into before that 2-18 date is governed by the law as it existed immediately before the 2-19 effective date of this Act, and that law is continued in effect for 2-20 that purpose. 2-21 SECTION 3. This Act takes effect September 1, 1999. 2-22 SECTION 4. The importance of this legislation and the 2-23 crowded condition of the calendars in both houses create an 2-24 emergency and an imperative public necessity that the 2-25 constitutional rule requiring bills to be read on three several 2-26 days in each house be suspended, and this rule is hereby suspended. _______________________________ _______________________________ President of the Senate Speaker of the House I certify that H.B. No. 1627 was passed by the House on May 8, 1999, by a non-record vote. _______________________________ Chief Clerk of the House I certify that H.B. No. 1627 was passed by the Senate on May 26, 1999, by the following vote: Yeas 30, Nays 0. _______________________________ Secretary of the Senate APPROVED: _____________________ Date _____________________ Governor