By: Sibley S.B. No. 992
2001S0590/1
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to coverage and assessments under the Texas Health
1-3 Insurance Risk Pool.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subdivision (17), Section 2, Article 3.77,
1-6 Insurance Code, is amended to read as follows:
1-7 (17) "Resident" means:
1-8 (A) an individual who has been legally domiciled
1-9 in Texas for a minimum of 30 days for persons eligible for
1-10 enrollment in the pool under Section 10(b) [10(a)(1), (2), (3), or
1-11 (5)] of this article; or
1-12 (B) an individual who is legally domiciled in
1-13 Texas for persons eligible for enrollment in the pool under Section
1-14 10(a) [10(a)(4)] of this article.
1-15 SECTION 2. Section 10, Article 3.77, Insurance Code, is
1-16 amended to read as follows:
1-17 Sec. 10. ELIGIBILITY FOR COVERAGE. (a) An individual
1-18 person who is a resident of Texas as defined in Section 2(17)(B) of
1-19 this article and who continues to be a resident of Texas shall be
1-20 eligible for coverage from the pool if the individual provides to
1-21 the pool evidence of:
1-22 (1) the individual's maintenance of health insurance
1-23 coverage for the previous 18 months, with no gap in coverage
1-24 greater than 63 days, of which the most recent coverage was
1-25 through: an employer-sponsored plan, a church plan, or a
2-1 government plan; or
2-2 (2) the individual's coverage under another state's
2-3 qualified Health Insurance Portability and Accountability Act
2-4 health program, if:
2-5 (A) coverage under that other state's program
2-6 was terminated because of nonresidence; and
2-7 (B) the individual person submits an application
2-8 for pool coverage within 63 days after termination of such prior
2-9 state plan coverage.
2-10 (b) Any individual person who is and continues to be a
2-11 resident of Texas as defined in Section 2(17)(A) of this article
2-12 and a citizen of the United States or a resident of Texas as
2-13 defined in Section 2(17)(A) of this article and a permanent
2-14 resident of the United States for at least three continuous years
2-15 shall be eligible for coverage from the pool if the individual
2-16 provides to the pool:
2-17 (1) a notice of rejection or refusal to issue
2-18 substantially similar individual insurance for health reasons by
2-19 one insurer, other than a rejection or refusal by an insurer
2-20 offering only stop-loss, excess loss, or reinsurance coverage;
2-21 (2) a certification from an agent or salaried
2-22 representative of an insurer, on a form developed by the board and
2-23 approved by the commissioner, that states that the agent or
2-24 salaried representative is unable to obtain substantially similar
2-25 individual insurance for the individual with any state-licensed
2-26 insurer that the agent or salaried representative represents
3-1 because the individual will be declined for coverage as a result of
3-2 a medical condition of the individual under the underwriting
3-3 guidelines of the insurer;
3-4 (3) an offer to issue substantially similar individual
3-5 insurance only with conditional riders;
3-6 (4) a refusal by an insurer to issue substantially
3-7 similar individual insurance except at a rate exceeding the pool
3-8 rate; or
3-9 (5) [evidence of the individual's maintenance of
3-10 health insurance coverage for the previous 18 months with no gap in
3-11 coverage greater than 63 days of which the most recent coverage was
3-12 through an employer sponsored plan; or]
3-13 [(6)] diagnosis of the individual with one of the
3-14 medical or health conditions listed by the board under Section 6(c)
3-15 of this article and for which a person shall be eligible for pool
3-16 coverage.
3-17 (c) [(b)] Each dependent of a person who is eligible for
3-18 coverage from the pool shall also be eligible for coverage from the
3-19 pool. In the instance of a child who is the primary insured,
3-20 resident family members shall also be eligible for coverage.
3-21 (d) [(c)] A person may maintain pool coverage for the period
3-22 of time the person is satisfying a preexisting waiting period under
3-23 another health insurance policy or insurance arrangement intended
3-24 to replace the pool policy.
3-25 (e) [(d)] A person is not eligible for coverage from the
3-26 pool if the person:
4-1 (1) has in effect on the date pool coverage takes
4-2 effect health insurance coverage from an insurer or insurance
4-3 arrangement;
4-4 (2) is eligible for other health care benefits at the
4-5 time application is made to the pool, including COBRA continuation,
4-6 except:
4-7 (A) coverage, including COBRA continuation,
4-8 other continuation or conversion coverage, maintained for the
4-9 period of time the person is satisfying any pre-existing condition
4-10 waiting period under a pool policy; or
4-11 (B) employer group coverage conditioned by the
4-12 type of limitations described by Subsection (b)(1) or (3)
4-13 [Subsections (a)(1) and (2)] of this section; or
4-14 (C) individual coverage conditioned by the
4-15 limitations described by Subsection (b)(3) or (4) [Subsections
4-16 (a)(1)-(3)] of this section;
4-17 (3) has terminated coverage in the pool within 12
4-18 months of the date that application is made to the pool, unless the
4-19 person demonstrates a good faith reason for the termination;
4-20 (4) is confined in a county jail or imprisoned in a
4-21 state prison;
4-22 (5) has premiums that are paid for or reimbursed under
4-23 any government sponsored program or by any government agency or
4-24 health care provider, except as an otherwise qualifying full-time
4-25 employee, or dependent thereof, of a government agency or health
4-26 care provider; or
5-1 (6) has [not] had prior coverage with the pool
5-2 terminated for nonpayment of premiums, within the 12 months
5-3 immediately preceding the date of application, or for fraud.
5-4 (f) [(e)] Pool coverage shall cease:
5-5 (1) on the date a person is no longer a resident of
5-6 this state, except for a child who is a student under the age of 23
5-7 years and who is financially dependent upon the parent, a child for
5-8 whom a person may be obligated to pay child support, or a child of
5-9 any age who is disabled and dependent upon the parent;
5-10 (2) on the date a person requests coverage to end;
5-11 (3) upon the death of the covered person;
5-12 (4) on the date state law requires cancellation of the
5-13 policy;
5-14 (5) at the option of the pool, 30 days after the pool
5-15 sends to the person any inquiry concerning the person's
5-16 eligibility, including an inquiry concerning the person's
5-17 residence, to which the person does not reply;
5-18 (6) on the 31st day after the day on which a premium
5-19 payment for pool coverage becomes due if the payment is not made
5-20 before that date; or
5-21 (7) at such time as the person ceases to meet the
5-22 eligibility requirements of this section.
5-23 (g) The coverage of a [(f) A] person who ceases to meet the
5-24 eligibility requirements of this section will be [may have his
5-25 coverage] terminated as of the earlier of the next premium due date
5-26 or the first day of the month following the date the pool
6-1 determines the person does not meet the eligibility requirements,
6-2 in the pool's sole discretion [at the end of the policy period].
6-3 (h) A person who is eligible for health insurance benefits
6-4 provided in connection with a policy, plan, or program paid for or
6-5 sponsored by an employer, even though such employer coverage is
6-6 declined, is not eligible for pool coverage. No insurer, agent,
6-7 third party administrator, or other person licensed under this code
6-8 may arrange or assist or attempt to arrange or assist in the
6-9 application or placement of such person in the pool for the purpose
6-10 of separating the person from health insurance benefits offered or
6-11 provided in connection with employment that would be available to
6-12 the person as an employee or as a dependent of an employee. A
6-13 violation of this subsection is an unfair method of competition and
6-14 an unfair or deceptive act or practice under Article 21.21 of this
6-15 code.
6-16 SECTION 3. Subsection (d), Section 13, Article 3.77,
6-17 Insurance Code, is amended to read as follows:
6-18 (d) The assessment imposed against each insurer shall be in
6-19 an amount that is equal to the ratio of the gross premiums
6-20 collected by the insurer for health insurance in this state during
6-21 the preceding calendar year, except for Medicare supplement
6-22 premiums subject to Article 3.74 and small group health insurance
6-23 premiums subject to Articles 26.01 through 26.76, to the gross
6-24 premiums collected by all insurers for health insurance, except for
6-25 Medicare supplement premiums subject to Article 3.74 and small
6-26 group health insurance premiums subject to Articles 26.01 through
7-1 26.76, in this state during the preceding calendar year. An
7-2 assessment is due on a date specified by the board that may not be
7-3 earlier than the 30th day after the date on which prior written
7-4 notice of the assessment due is transmitted to the insurer.
7-5 Interest accrues on the unpaid amount at a rate equal to the prime
7-6 lending rate plus three percent.
7-7 SECTION 4. This Act takes effect September 1, 2001.