76R12284 DLF-D
By Burnam H.B. No. 3096
Substitute the following for H.B. No. 3096:
By Olivo C.S.H.B. No. 3096
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to exclusions and limitations applied under certain health
1-3 benefit plans.
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 21.52L to read as follows:
1-7 Art. 21.52L. ACTUARIAL SUPPORT FOR LIMITATIONS AND
1-8 EXCLUSIONS APPLIED IN HEALTH BENEFIT PLANS
1-9 Sec. 1. DEFINITION. In this article, "health benefit plan"
1-10 means a health benefit plan described by Section 2 of this article.
1-11 Sec. 2. SCOPE OF ARTICLE. (a) This article applies only to
1-12 a health benefit plan that provides benefits for medical or
1-13 surgical expenses incurred as a result of a health condition,
1-14 accident, or sickness, including an individual, group, blanket, or
1-15 franchise insurance policy or insurance agreement, a group hospital
1-16 service contract, or an individual or group evidence of coverage or
1-17 similar coverage document that is offered by:
1-18 (1) an insurance company;
1-19 (2) a group hospital service corporation operating
1-20 under Chapter 20 of this code;
1-21 (3) a fraternal benefit society operating under
1-22 Chapter 10 of this code;
1-23 (4) a stipulated premium insurance company operating
1-24 under Chapter 22 of this code;
2-1 (5) a reciprocal exchange operating under Chapter 19
2-2 of this code;
2-3 (6) a health maintenance organization operating under
2-4 the Texas Health Maintenance Organization Act (Chapter 20A,
2-5 Vernon's Texas Insurance Code);
2-6 (7) a multiple employer welfare arrangement that holds
2-7 a certificate of authority under Article 3.95-2 of this code;
2-8 (8) an approved nonprofit health corporation that
2-9 holds a certificate of authority issued by the commissioner under
2-10 Article 21.52F of this code; or
2-11 (9) a small employer carrier or a large employer
2-12 carrier operating under Chapter 26 of this code.
2-13 (b) This article does not apply to a plan that provides
2-14 coverage only for a specified disease or other limited benefit.
2-15 Sec. 3. USE OF CERTAIN EXCLUSIONS OR LIMITATIONS PROHIBITED.
2-16 (a) An issuer of a health benefit plan may not exclude from
2-17 coverage under the plan, or limit the amount, type, or extent of
2-18 coverage under the plan for, a specified health condition, injury,
2-19 sickness, or disability unless the exclusion or limitation is based
2-20 on sound actuarial principles or actual or reasonably anticipated
2-21 loss experience.
2-22 (b) In complying with this article, an issuer of a health
2-23 benefit plan shall use actuarial data or loss experience data that
2-24 is accurate, reliable, geographically specific, and current at the
2-25 time of use.
2-26 (c) The commissioner may adopt rules to implement this
2-27 article.
3-1 Sec. 4. CONDUCT OF OTHER PERSONS. (a) An insurance agent,
3-2 third party administrator, or life insurance counselor may not
3-3 offer, recommend, sell, or administer, or participate in the
3-4 offering, recommendation, sale, or administration of, a health
3-5 benefit plan that violates Section 3 of this article.
3-6 (b) An actuary who certifies a health benefit plan as
3-7 complying with Section 3 of this article violates this article if
3-8 the actuary knows, at the time the certification is made, that the
3-9 certification is false.
3-10 Sec. 5. VIOLATION; PENALTY. (a) A violation of this
3-11 article is an unfair and deceptive act or practice in the business
3-12 of insurance for purposes of Article 21.21 of this code and is
3-13 subject to the sanctions and penalties imposed under that article.
3-14 (b) Approval by the commissioner of the policy form or other
3-15 form used by the health benefit plan issuer under any law of this
3-16 state, including Article 3.42 of this code and Section 9, Texas
3-17 Health Maintenance Organization Act (Article 20A.09, Vernon's Texas
3-18 Insurance Code), is not a defense to an action brought under
3-19 Article 21.21 of this code with respect to a violation of this
3-20 article.
3-21 SECTION 2. This Act takes effect September 1, 1999.
3-22 SECTION 3. This Act applies only to a health benefit plan
3-23 that is delivered, issued for delivery, or renewed on or after
3-24 January 1, 2000. A health benefit plan that is delivered, issued
3-25 for delivery, or renewed before January 1, 2000, is governed by the
3-26 law as it existed immediately before the effective date of this
3-27 Act, and that law is continued in effect for this purpose.
4-1 SECTION 4. The importance of this legislation and the
4-2 crowded condition of the calendars in both houses create an
4-3 emergency and an imperative public necessity that the
4-4 constitutional rule requiring bills to be read on three several
4-5 days in each house be suspended, and this rule is hereby suspended.