By Fraser S.B. No. 844
77R2056 MXM-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to assessment of the impact of proposed health care
1-3 benefit mandates and offer of coverage mandates.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Title 1, Insurance Code, is amended by adding
1-6 Chapter 28 to read as follows:
1-7 CHAPTER 28. ASSESSMENT OF HEALTH CARE BENEFIT AND OFFER OF
1-8 COVERAGE MANDATES
1-9 SUBCHAPTER A. GENERAL PROVISIONS
1-10 Art. 28.001. GENERAL DEFINITIONS. In this chapter:
1-11 (1) "Certified actuary" means:
1-12 (A) a fellow of the Society of Actuaries;
1-13 (B) a fellow of the Casualty Actuarial Society;
1-14 or
1-15 (C) a member of the American Academy of
1-16 Actuaries.
1-17 (2) "Health care benefit mandate" means a state law
1-18 that requires a health benefit plan to provide coverage or
1-19 reimbursement for a specific health care service, treatment, or
1-20 procedure, a specific medical condition or illness, or a particular
1-21 group of people who would otherwise be excluded, or to reimburse a
1-22 specific type of health care provider directly or in a specific
1-23 amount. The term does not include an offer of coverage mandate.
1-24 (3) "Offer of coverage mandate" means a state law that
2-1 requires a health benefit plan to offer as part of the plan's
2-2 benefit schedule coverage that may be rejected by the contract
2-3 holder and for which an additional premium may be charged.
2-4 Art. 28.002. DEFINITION OF HEALTH BENEFIT PLAN. (a) In this
2-5 chapter, "health benefit plan" means a plan that provides benefits
2-6 for medical or surgical expenses incurred as a result of a health
2-7 condition, accident, or sickness, including an individual, group,
2-8 blanket, or franchise insurance policy or insurance agreement, a
2-9 group hospital service contract, or an individual or group evidence
2-10 of coverage or similar coverage document that is offered by:
2-11 (1) an insurance company;
2-12 (2) a group hospital service corporation operating
2-13 under Chapter 20 of this code;
2-14 (3) a fraternal benefit society operating under
2-15 Chapter 10 of this code;
2-16 (4) a stipulated premium insurance company operating
2-17 under Chapter 22 of this code;
2-18 (5) a reciprocal exchange operating under Chapter 19
2-19 of this code;
2-20 (6) a health maintenance organization operating under
2-21 the Texas Health Maintenance Organization Act (Chapter 20A,
2-22 Vernon's Texas Insurance Code);
2-23 (7) a multiple employer welfare arrangement that holds
2-24 a certificate of authority under Article 3.95-2 of this code; or
2-25 (8) an approved nonprofit health corporation that
2-26 holds a certificate of authority under Article 21.52F of this code.
2-27 (b) "Health benefit plan" does not include:
3-1 (1) a plan that provides coverage only:
3-2 (A) for benefits for a specified disease or for
3-3 another limited benefit other than for cancer;
3-4 (B) for accidental death or dismemberment;
3-5 (C) for wages or payments in lieu of wages for a
3-6 period during which an employee is absent from work because of
3-7 sickness or injury;
3-8 (D) as a supplement to a liability insurance
3-9 policy;
3-10 (E) for credit insurance;
3-11 (F) for dental or vision care; or
3-12 (G) for indemnity for hospital confinement;
3-13 (2) a Medicare supplemental policy as defined by
3-14 Section 1882(g)(1), Social Security Act (42 U.S.C. Section 1395ss),
3-15 as amended;
3-16 (3) a workers' compensation insurance policy;
3-17 (4) medical payment insurance coverage provided under
3-18 a motor vehicle insurance policy; or
3-19 (5) a long-term care insurance policy, including a
3-20 nursing home fixed indemnity policy, unless the commissioner
3-21 determines that the policy provides benefit coverage so
3-22 comprehensive that the policy is a health benefit plan as described
3-23 by Subsection (a) of this article.
3-24 (Articles 28.003-28.050 reserved for expansion
3-25 SUBCHAPTER B. IMPACT ASSESSMENT OF PROPOSED MANDATE
3-26 BY LEGISLATIVE BUDGET BOARD
3-27 Art. 28.051. REQUEST FOR IMPACT ASSESSMENT. If the chair of
4-1 a standing committee of the legislature determines that a bill
4-2 would, if enacted, create a health care benefit mandate or an offer
4-3 of coverage mandate, the chair shall send a copy of the bill to the
4-4 Legislative Budget Board and request that an impact assessment of
4-5 the mandate be prepared.
4-6 Art. 28.052. PREPARATION OF IMPACT ASSESSMENT; ACTUARIAL
4-7 ASSISTANCE REQUIRED. (a) On receipt of a bill under Article 28.051
4-8 of this code, the Legislative Budget Board shall prepare a written
4-9 impact assessment of the mandate in accordance with this
4-10 subchapter.
4-11 (b) In preparing an impact assessment, the director of the
4-12 Legislative Budget Board may:
4-13 (1) use any information supplied by any person,
4-14 agency, organization, or governmental unit that the director
4-15 determines is reliable; and
4-16 (2) obtain assistance in preparing the assessment from
4-17 any state agency or by contract with a private entity.
4-18 (c) The Legislative Budget Board shall obtain the assistance
4-19 of at least one certified actuary who is qualified to provide an
4-20 opinion relating to an impact assessment under this subchapter.
4-21 (d) An impact assessment prepared under this subchapter must
4-22 include:
4-23 (1) any report relating to the mandate produced by an
4-24 actuary or other expert retained by the Legislative Budget Board;
4-25 and
4-26 (2) a description of all underlying assumptions, data,
4-27 and studies on which the evaluation was based.
5-1 (e) The director of the Legislative Budget Board shall
5-2 submit an impact assessment requested under Article 28.051 of this
5-3 code not later than the 21st day after the date of the request.
5-4 Art. 28.053. CONTENTS OF IMPACT ASSESSMENT. (a) An impact
5-5 assessment of a health care benefit mandate or offer of coverage
5-6 mandate prepared under this subchapter must include, as applicable:
5-7 (1) the level of demand in the state for the coverage
5-8 that is the subject of the mandate, including the number and
5-9 percentage of individuals in the state who are affected by the
5-10 medical condition or illness that is the subject of the mandate or
5-11 who would be likely to use the coverage that is the subject of the
5-12 mandate;
5-13 (2) the extent to which the coverage is available
5-14 under health benefit plans that are in effect at the time the
5-15 impact assessment is made;
5-16 (3) the extent to which lack of the coverage causes
5-17 individuals to avoid necessary medical treatment; and
5-18 (4) the amount of support for including the coverage
5-19 in health benefit plan contracts.
5-20 (b) For an offer of coverage mandate, the impact assessment
5-21 must also estimate the difference in the cost of a health benefit
5-22 plan that provides the coverage and a comparable health benefit
5-23 plan that does not provide the coverage.
5-24 (c) For a health care benefit mandate, the impact assessment
5-25 must also estimate the impact of the mandate if the mandate was an
5-26 offer of coverage mandate.
5-27 Art. 28.054. IMPACT ASSESSMENT IN CERTAIN CIRCUMSTANCES. If
6-1 the director of the Legislative Budget Board determines that the
6-2 impact of a proposed health benefit plan mandate or offer of
6-3 coverage mandate cannot be fully ascertained or the director is
6-4 unable to acquire or develop sufficient information to prepare a
6-5 complete impact assessment within 21 days of receiving the bill
6-6 from the chair of a committee, the director shall:
6-7 (1) report that fact in writing to the chair of the
6-8 committee; and
6-9 (2) prepare an impact assessment that:
6-10 (A) complies as much as possible with the
6-11 requirements of Article 28.053 of this code; and
6-12 (B) explains which of the applicable
6-13 requirements of that article are not met and why they are not met.
6-14 Art. 28.055. DISTRIBUTION OF IMPACT ASSESSMENT. Copies of an
6-15 impact assessment prepared under this subchapter must be
6-16 distributed to the members of the committee not later than the
6-17 first time the bill to which the assessment relates is laid out in
6-18 a committee meeting. The assessment shall be attached to the bill
6-19 on first printing. If the bill is amended by the committee in a
6-20 way that alters a mandate, the chair shall obtain an updated impact
6-21 assessment, which shall also be attached to the bill on first
6-22 printing.
6-23 Art. 28.056. IMPACT ASSESSMENT REMAINS WITH BILL. An impact
6-24 assessment prepared under this subchapter shall remain with the
6-25 bill to which the assessment relates throughout the entire
6-26 legislative process, including submission to the governor.
6-27 (Articles 28.057-28.100 reserved for expansion
7-1 SUBCHAPTER C. ASSESSMENT OF ENACTED MANDATE BY LEGISLATIVE
7-2 BUDGET BOARD
7-3 Art. 28.101. APPLICABILITY OF SUBCHAPTER. This subchapter
7-4 applies only to a health care benefit mandate or offer of coverage
7-5 mandate provided for:
7-6 (1) in a statute that:
7-7 (A) specifically references this subchapter; and
7-8 (B) will expire on a date provided in the law;
7-9 or
7-10 (2) in a rule adopted by the commissioner.
7-11 Art. 28.102. EXPIRATION DATE FOR RULE. (a) The commissioner
7-12 shall assign an expiration date that complies with this article for
7-13 each health care benefit mandate or offer of coverage mandate that
7-14 the commissioner adopts by rule.
7-15 (b) Except as provided by Subsection (c) of this article,
7-16 the expiration date must be September 1 of the odd-numbered year
7-17 following the sixth anniversary of the date the mandate is adopted.
7-18 (c) The commissioner may assign an expiration date other
7-19 than the date provided by this article in order to allow a rule to
7-20 be assessed under this subchapter at the same time as a statute the
7-21 commissioner determines is related to the rule.
7-22 Art. 28.103. ASSESSMENT OF MANDATE. Before September 1 of
7-23 the calendar year before the year a health care benefit mandate or
7-24 an offer of coverage mandate subject to this subchapter expires,
7-25 the Legislative Budget Board shall:
7-26 (1) conduct an assessment of the mandate based on the
7-27 criteria provided by Article 28.105 of this code; and
8-1 (2) review any prior board recommendations relating to
8-2 the mandate in reports presented to the legislature under this
8-3 subchapter in a preceding legislative session.
8-4 Art. 28.104. REPORT; RECOMMENDATION. (a) Not later than
8-5 March 1 of the year of a regular legislative session, the
8-6 Legislative Budget Board shall present to the legislature a report
8-7 on each health care benefit mandate or offer of coverage mandate
8-8 that is scheduled to expire that year.
8-9 (b) In the report, the Legislative Budget Board shall
8-10 include:
8-11 (1) the specific findings of the board regarding each
8-12 of the criteria considered under Article 28.105 of this code;
8-13 (2) recommendations of the board regarding whether the
8-14 mandate should be continued or modified; and
8-15 (3) any other information the board considers
8-16 necessary for a complete assessment of the mandate.
8-17 Art. 28.105. CRITERIA FOR ASSESSMENT. The Legislative
8-18 Budget Board, in determining whether a health care benefit mandate
8-19 or an offer of coverage mandate should be continued or modified,
8-20 shall consider:
8-21 (1) the level of demand in the state for the coverage
8-22 that is the subject of the mandate, including the number and
8-23 percentage of individuals, statewide and among distinct population
8-24 groups, who are affected by the medical condition or illness that
8-25 is the subject of the mandate or who use the coverage that is the
8-26 subject of the mandate;
8-27 (2) the extent to which it is likely that the coverage
9-1 would be made available under health benefit plans if the mandate
9-2 were not in effect;
9-3 (3) the extent to which lack of the coverage would
9-4 cause individuals to avoid necessary medical treatment; and
9-5 (4) the amount of support for continuing to include
9-6 the coverage in health benefit plan contracts.
9-7 Art. 28.106. CONTINUATION OF MANDATE BY LAW. (a) During the
9-8 regular session immediately before the expiration of a health care
9-9 benefit mandate or an offer of coverage mandate, the legislature by
9-10 law may continue the mandate for a period that does not exceed six
9-11 years or, if applicable, authorize the commissioner to continue the
9-12 mandate for a period that does not exceed six years. A mandate may
9-13 be modified at the time the mandate is continued.
9-14 (b) This subchapter does not prohibit the legislature from:
9-15 (1) repealing a health care benefit mandate or offer
9-16 of coverage mandate on a date earlier than the date on which the
9-17 mandate expires under this subchapter; or
9-18 (2) considering any other legislation relating to a
9-19 mandate.
9-20 Art. 28.107. EFFECT OF EXPIRATION OF MANDATE ON HEALTH
9-21 BENEFIT PLAN. A health care benefit mandate that has expired shall
9-22 continue to govern a health benefit plan issued, delivered, or
9-23 issued for delivery before the expiration date of the mandate until
9-24 the end of the contract period for the plan or, if the plan is a
9-25 guaranteed renewable plan, until the plan is terminated.
9-26 SECTION 2. Article 28.102, Insurance Code, as added by this
9-27 Act, applies only to a rule adopted on or after the effective date
10-1 of this Act.
10-2 SECTION 3. This Act takes effect September 1, 2001.