H.B. 897 78(R)    BILL ANALYSIS


H.B. 897
By: Woolley
Insurance
Committee Report (Unamended)



BACKGROUND AND PURPOSE 

In 1993 the Texas Legislature permitted small employers to join together
in private nonprofit health insurance purchasing alliances or small
employer health coalitions.  Some insurers have canceled policies with
small employer health coalitions because they do not consider a coalition
to be a single employer.  House Bill 897 clarifies that a small employer
heath coalition is a single small employer for all purposes under the
Insurance Code. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

House Bill 897 amends the Insurance Code to provide that a small employer
health coalition that otherwise meets the description of a small employer
is considered a single small employer for all purposes under the Insurance
Code.  The bill defines small employer health coalition as a private
purchasing cooperative composed solely of small employers.  The bill
prohibits a cooperative from limiting, restricting, or conditioning an
employer's or employee's choice among benefit plans based on health status
related factors, duration of coverage, or any similar characteristic
related to the health status or experience of a group or of any member of
a group. 

The bill deletes the exception for purchasing cooperatives from the
provision authorizing small employer carriers to elect not to offer health
benefit plans to an employer who offers multiple health benefit plans.  

EFFECTIVE DATE

September 1, 2003.