SRC-TBR H.B. 471 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 471
77R3277 PB-FBy: Averitt (Harris)
Business & Commerce
5/2/2001
Engrossed


DIGEST AND PURPOSE 

Currently, the smallest employers in Texas are finding it increasingly
difficult to obtain affordable health insurance for their employees.  H.B.
471 prohibits a small employer carrier from implementing agent commission
schedules that vary the level of agent commissions based on the size of the
group, or otherwise reduce access to small employer health benefit plans.  

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Article 26.73, Insurance Code, by adding Subsections (c)
and (d), as follows: 

(c)  Prohibits a small employer carrier from implementing, directly or
indirectly, agent commission schedules that vary the level of agent
commissions based on the size of the group, or otherwise reduce access to
small employer health benefit plans. 

 (d)  Authorizes a small employer, notwithstanding Subsection (c) of this
article, to: 

(1)  vary agent commission amounts or percentages  based on group size if
the variation in the commission amounts or percentages are inversely
related to the size of the group; 

(2)  vary agent commission amounts or percentages based on the cumulative
premium paid by a single small employer over a specific period if the
variation in the commission amounts or percentages are inversely related to
the cumulative premium paid during the period; or 

(3)  pay agent commissions as a percentage of premium charged to a small
employer if the commission percentage is based on all premium paid by the
small employer. 

SECTION 2.  Provides that Article 26.73, Insurance Code, as amended by this
Act, applies only to a small employer health benefit plan that is delivered
or issued for delivery on or after January 1, 2002. Provides that a health
benefit plan delivered or issued for delivery before January 1, 2002, is
governed by the law as it existed immediately before the effective date of
this Act, and that law is continued in effect for that purpose. 

SECTION 3.  Effective date: September 1, 2001.