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78R10766 KCR-D


By:  Seaman                                                       H.B. No. 1267

Substitute the following for H.B. No. 1267:                                   

By:  Seaman                                                   C.S.H.B. No. 1267


A BILL TO BE ENTITLED
AN ACT
relating to small employer health benefit plans. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Article 26.42(a), Insurance Code, is amended to read as follows: (a) A small employer carrier shall offer the following two health benefit plans filed with and approved [as adopted] by the commissioner: (1) a [the] catastrophic care benefit plan; and (2) a [the] basic coverage benefit plan. SECTION 2. Article 26.43(a), Insurance Code, is amended to read as follows: (a) A [The commissioner shall promulgate the benefits section of the catastrophic care benefit plan and the basic coverage benefit plan policy forms in accordance with Article 26.44A of this code and shall develop prototype policies for each of the benefit plans. For all other portions of these policy forms, a] small employer carrier shall comply with Article 3.42 of this code as it relates to policy form approval and with Chapter 843 of this code [the Texas Health Maintenance Organization Act (Article 20A.01 et seq., Vernon's Texas Insurance Code)] as it relates to approval of an evidence of coverage. [A small employer carrier may not offer these benefit plans through a policy form or evidence of coverage that does not comply with this chapter.] SECTION 3. Article 26.44A, Insurance Code, is amended by amending Subsections (a), (b), and (c) and adding Subsections (e), (f), and (g) to read as follows: (a) The commissioner shall review for approval [by rule shall establish the coverage requirements for the] catastrophic care benefit plans [plan] and [the] basic coverage benefit plans developed by a small employer carrier under Article 26.42 of this code [plan. The commissioner shall develop prototype policies for use by small employer carriers that include all contractual provisions required to produce an entire contract in accordance with this article and this code]. (b) Coverage under a [the] catastrophic care benefit plan must be designed to provide necessary coverage in the event of catastrophic illness or injury. [The commissioner shall establish deductibles and coinsurance requirements at levels that permit options for the insured to obtain affordable catastrophic coverage.] (c) [The commissioner by rule shall establish coverage requirements for the basic coverage benefit plan.] Coverage under a [the] basic coverage benefit plan must be designed to provide basic hospital, medical, and surgical coverages. Benefits under the plan are limited to basic care requirements for illness and injury. (e) A basic coverage benefit plan or catastrophic care benefit plan may exclude any state-mandated health benefit. (f) For purposes of this article, "state-mandated health benefit" means coverage required under this code or other laws of this state to be provided in a group policy for accident and health insurance or a contract for a health-related condition that: (1) includes coverage for specific health care services or benefits; (2) places limitations or restrictions on deductibles, coinsurance, copayments, or any annual or lifetime maximum benefit amounts; or (3) includes a specific category of licensed health care practitioner from whom an insured is entitled to receive care. (g) For purposes of this article, "state-mandated health benefit" does not include a benefit or standard provision or right required under federal law, this code, or other laws of this state to be provided in a group policy for accident and health insurance or a contract for a health-related condition that is unrelated to a specific health illness, injury, or condition of an insured, including a provision related to: (1) continuation of coverage under: (A) Section 1(d)(3) and Section 3B, Article 3.51-6, of this code; (B) Section 2(C), Chapter 397, Acts of the 54th Legislature, Regular Session, 1955 (Article 3.70-2, Vernon's Texas Insurance Code); (C) Article 3.51-8 of this code; and (D) Section 9(k), Texas Health Maintenance Organization Act (Article 20A.09, Vernon's Texas Insurance Code), as added by Chapter 837, Acts of the 75th Legislature, Regular Session, 1997; (2) termination of coverage under Articles 26.23 and 26.86 of this code; (3) preexisting conditions under Articles 26.49 and 26.90 of this code; (4) coverage of children, including newborn or adopted children, under: (A) Sections 1, 3D, and 3E, Article 3.51-6, of this code; (B) Section 2(A), Chapter 397, Acts of the 54th Legislature, Regular Session, 1955 (Article 3.70-2, Vernon's Texas Insurance Code), as amended by Chapters 396 and 1027, Acts of the 77th Legislature, Regular Session, 2001; (C) Sections 2(E), (K), and (M), Chapter 397, Acts of the 54th Legislature, Regular Session, 1955 (Article 3.70-2, Vernon's Texas Insurance Code); (D) Subchapter J, Chapter 3, of this code; (E) Article 21.24-2 of this code; (F) Article 26.21(n) of this code; (G) Article 26.21A of this code; and (H) Article 26.84 of this code; and (5) coverage of grandchildren under the benefit provisions of the health maintenance organization laws of this state. SECTION 4. Article 26.48(a), Insurance Code, is amended to read as follows: (a) A health maintenance organization may offer: (1) a state-approved health benefit plan that complies with this chapter, Chapter 843 of this code [the Texas Health Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance Code), Title XIII, Public Health Service Act (42 U.S.C. Section 300e et seq.), and its subsequent amendments], and rules adopted under these laws; (2) a plan developed by a health maintenance organization [the commissioner] under Article 26.44A of this code and additional benefit riders to the plan; or (3) a point-of-service contract in connection with an insurance carrier that includes optional coverage for out-of-area services, emergency care, or out-of-network care. SECTION 5. Section 843.002(2), Insurance Code, is amended to read as follows: (2) "Basic health care services" means health care services that the commissioner determines an enrolled population might reasonably need to be maintained in good health[, including, at a minimum, services designated as basic health services under Section 1302, Title XIII, Public Health Service Act (42 U.S.C. Section 300e-1(1))]. SECTION 6. This Act takes effect September 1, 2003, and applies only to an insurance policy or evidence of coverage that is delivered, issued for delivery, or renewed on or after January 1, 2004. An insurance policy or evidence of coverage that is delivered, issued for delivery, or renewed before January 1, 2004, is governed by the law as it existed immediately before the effective date of this Act, and the former law is continued in effect for that purpose.