SRC-JBJ H.B. 1203 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 1203
By: Brimer (Fraser)
State Affairs
5/11/2001
Engrossed


DIGEST AND PURPOSE 

Current law authorizes a state agency or an institution of higher education
(agency) to purchase its own insurance policies.  As a result, a state
agency may purchase an unnecessary or questionable policy which may pose an
additional cost to the state.  H.B. 1203 requires the State Office of Risk
Management (office) to administer insurance services obtained by certain
state agencies and operate as a full-service insurance and risk manager,
and requires the office, in administering insurance services, to purchase
insurance coverage for state agencies.  

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the risk management board in
SECTION 1.02 (Section 412.011, Labor Code); SECTION 1.04 (Section 412.0121,
Labor Code); and SECTION 3.01 of this bill.  

Rulemaking authority is expressly granted to the State Office of Risk
Management in SECTION 1.11 (Section 2, Insurance Code) of this bill. 

SECTION BY SECTION ANALYSIS

ARTICLE 1.  PURCHASE OF INSURANCE COVERAGE

Amends various provisions and adds various new provisions regarding the
purchase and administration of insurance coverage by certain state
agencies; certain duties, functions, and authorities of the State Office of
Risk Management (office), the risk management board (board), and the
executive director of the office; workers' compensation; and certain
reporting requirements of an insurer. 

ARTICLE 2.  EFFECT OF USE OF LEAVE ON INCOME BENEFITS

Sets forth provisions regarding the effect of the use of sick and annual
leave on certain income benefits under certain conditions. 

ARTICLE 3.  TRANSITION; EFFECTIVE DATE

SECTION 3.01. (a)  Effective date: September 1, 2001, except as provided by
Subsections (b), (c), and (d) of this section. 

(b)  Requires the board, not later than  December 1, 2001, to adopt rules
to implement the changes in law made by the amendments made by this Act to
Chapter 412, Labor Code and article 21.49-15A, Insurance Code, as added by
this Act. 

(c)  Provides that an insurer is not required to comply with the reporting
requirements adopted under Article 21.49-15A, Insurance Code, as added by
this Act, until January 1, 2002. Provides that Article 21.49-15A, Insurance
Code, as added by this Act, applies only to an insurance policy, contract,
or agreement delivered, issued for delivery, or renewed on or after
January 1, 2002.  Provides that a policy, contract, or agreement delivered,
issued for delivery, or renewed 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. 
 
 (d)  Makes application of Section 505.060, Labor Code, as added by this
Act, prospective.