1-1 By: Maxey (Senate Sponsor - Cain) H.B. No. 1627 1-2 (In the Senate - Received from the House May 10, 1999; 1-3 May 10, 1999, read first time and referred to Committee on Economic 1-4 Development; May 14, 1999, reported favorably by the following 1-5 vote: Yeas 5, Nays 0; May 14, 1999, sent to printer.) 1-6 A BILL TO BE ENTITLED 1-7 AN ACT 1-8 relating to certain requirements for insurers that contract with 1-9 municipalities. 1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-11 SECTION 1. Subchapter E, Chapter 21, Insurance Code, is 1-12 amended by adding Article 21.49-16 to read as follows: 1-13 Art. 21.49-16. BID REQUIREMENTS FOR INSURERS WHO CONTRACT 1-14 WITH MUNICIPALITIES 1-15 Sec. 1. DEFINITIONS. In this article: 1-16 (1) "Insurer" means: 1-17 (A) an insurance company, including a company 1-18 providing stop-loss or excess loss insurance; 1-19 (B) a health maintenance organization operating 1-20 under the Texas Health Maintenance Organization Act (Chapter 20A, 1-21 Vernon's Texas Insurance Code); 1-22 (C) an approved nonprofit health corporation 1-23 that holds a certificate of authority issued by the commissioner 1-24 under Article 21.52F of this code; or 1-25 (D) a third party administrator that holds a 1-26 certificate of authority under Article 21.07-6 of this code. 1-27 (2) "Municipality" has the meaning assigned by Section 1-28 1.005, Local Government Code. 1-29 Sec. 2. REQUIREMENTS. (a) An insurer who bids on a 1-30 contract subject to the competitive bidding and competitive 1-31 proposal requirements adopted under Section 252.021, Local 1-32 Government Code, may not submit a bid for a contract to provide 1-33 stop-loss or other insurance coverage that is subject to any 1-34 qualification imposed by the insurer that permits the insurer to 1-35 modify or limit the terms of insurance coverage to be provided 1-36 after the contract has been made. An insurer's bid submitted under 1-37 Section 252.021, Local Government Code, must contain the entire 1-38 offer made by the insurer. 1-39 (b) An insurer who provides stop-loss or other insurance 1-40 coverage for health benefits under a contract subject to this 1-41 article may not, based on an individual's prior medical history, 1-42 exclude an individual who is otherwise eligible for the health 1-43 benefits coverage from coverage or assign a higher deductible to 1-44 the individual. 1-45 SECTION 2. Article 21.49-16, Insurance Code, as added by 1-46 this Act, applies only to a contract entered into on or after the 1-47 effective date of this Act. A contract entered into before that 1-48 date is governed by the law as it existed immediately before the 1-49 effective date of this Act, and that law is continued in effect for 1-50 that purpose. 1-51 SECTION 3. This Act takes effect September 1, 1999. 1-52 SECTION 4. The importance of this legislation and the 1-53 crowded condition of the calendars in both houses create an 1-54 emergency and an imperative public necessity that the 1-55 constitutional rule requiring bills to be read on three several 1-56 days in each house be suspended, and this rule is hereby suspended. 1-57 * * * * *