By Van de Putte                                        S.B. No. 805
         77R1154 PB-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to parity in certain disability insurance benefits.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Subchapter E, Chapter 21, Insurance Code, is
 1-5     amended by adding Article 21.53O to read as follows:
 1-6           Art. 21.53O.  PARITY IN CERTAIN DISABILITY INSURANCE BENEFITS
 1-7           Sec. 1.  APPLICATION.  This article applies to a disability
 1-8     insurance policy or plan issued under:
 1-9                 (1)  a policy of group accident and health insurance,
1-10     as defined by Section 1, Article 3.51-6, of this code;
1-11                 (2)  a policy of blanket accident and health insurance,
1-12     as defined by Section 2, Article 3.51-6, of this code;
1-13                 (3)  an individual policy of accident and sickness
1-14     insurance as defined by Section (B)(3), Chapter 397, Acts of the
1-15     54th Legislature, Regular Session, 1955 (Article 3.70-1, Vernon's
1-16     Texas Insurance Code); or
1-17                 (4)  an evidence of coverage as defined by the Texas
1-18     Health Maintenance Organization Act (Chapter 20A, Vernon's Texas
1-19     Insurance Code).
1-20           Sec. 2.  PARITY IN COVERAGE REQUIRED.  (a)  An insurance
1-21     policy or evidence of coverage subject to this article may not be
1-22     delivered, issued for delivery, or renewed in this state if the
1-23     terms of the policy or evidence of coverage exclude or reduce the
1-24     payment of benefits to or on behalf of an insured or enrollee
 2-1     because of a mental illness, disease, or disorder, unless that
 2-2     exclusion or limitation is equally applicable to all other
 2-3     physically disabling conditions.  Each disability policy or plan
 2-4     subject to this article must provide parity in benefits for mental
 2-5     and physical disabilities.
 2-6           (b)  A provision in an insurance policy or evidence of
 2-7     coverage that violates this section is void.
 2-8           Sec. 3.  VIOLATION; PENALTY.  (a)  A violation of this
 2-9     article is an unfair and deceptive act or practice in the business
2-10     of insurance for purposes of Article 21.21 of this code and is
2-11     subject to the sanctions and penalties imposed under that article. 
2-12           (b)  Approval by the commissioner of the policy or product
2-13     form or other form used by the policy or plan issuer under any law
2-14     of this state, including Article 3.42 of this code or Section 9,
2-15     Texas Health Maintenance Organization Act (Article 20A.09, Vernon's
2-16     Texas Insurance Code), is not a defense to an action brought under
2-17     Article 21.21 of this code with respect to a violation of this
2-18     article.
2-19           SECTION 2.  Article 21.53O, Insurance Code, as added by this
2-20     Act, applies only to an insurance policy, contract, or evidence of
2-21     coverage delivered, issued for delivery, or renewed on or after
2-22     January 1, 2002.  A policy, contract, or evidence of coverage
2-23     delivered, issued for delivery, or renewed before January 1, 2002,
2-24     is governed by the law as it existed immediately before the
2-25     effective date of this Act, and that law is continued in effect for
2-26     that purpose.
2-27           SECTION 3.  This Act takes effect September 1, 2001.