By Thompson                                           H.B. No. 2051
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to classes of business for small employer health benefit
 1-3     plans.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Article 26.02(5), Insurance Code, is amended to
 1-6     read as follows:
 1-7                 (5)  "Case characteristics" means, with respect to a
 1-8     small employer, the geographic area in which that employer's
 1-9     employees reside, the age and gender of the individual employees
1-10     and their dependents, the appropriate industry classification as
1-11     determined by the small employer carrier, [the number of employees
1-12     and dependents,] and other objective criteria as established by the
1-13     small employer carrier that are considered by the small employer
1-14     carrier in setting premium rates for that small employer.  The term
1-15     does not include the number of employees and dependents, health
1-16     status related factors, duration of coverage since the date of
1-17     issuance of a health benefit plan, or whether a covered person is
1-18     or may become pregnant.
1-19           SECTION 2.  Article 26.73, Insurance Code, is amended by
1-20     adding Subsection (c) to read as follows:
1-21           (c)  Except as provided under Subsection (a) of this article,
1-22     a small employer carrier may vary the agent commission rates paid
1-23     on small employer premiums, but only if:
1-24                 (1)  the only factor that is used to differentiate
 2-1     agent commission levels is the number of employees covered under
 2-2     the small employer plan; and
 2-3                 (2)  the commission levels are inversely related to the
 2-4     number of employees covered under the small employer plan.
 2-5           SECTION 3.  This Act takes effect September 1, 1999, and
 2-6     applies only to a small employer health benefit plan that is
 2-7     delivered, issued for delivery, or renewed on or after January 1,
 2-8     2000.  A health benefit plan delivered, issued for delivery, or
 2-9     renewed before January 1, 2000, is governed by the law as it
2-10     existed immediately before the effective date of this Act, and that
2-11     law is continued in effect for that purpose.
2-12           SECTION 4.  The importance of this legislation and the
2-13     crowded condition of the calendars in both houses create an
2-14     emergency and an imperative public necessity that the
2-15     constitutional rule requiring bills to be read on three several
2-16     days in each house be suspended, and this rule is hereby suspended.