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78R7295 AJA-D
By: Gallego H.B. No. 1939
A BILL TO BE ENTITLED
AN ACT
relating to health care benefit mandates and offer of coverage
mandates.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 1, Insurance Code, is amended by adding
Chapter 28 to read as follows:
CHAPTER 28. ASSESSMENT OF HEALTH CARE BENEFIT AND OFFER OF
COVERAGE MANDATES
SUBCHAPTER A. GENERAL PROVISIONS
Art. 28.001. GENERAL DEFINITIONS. In this chapter:
(1) "Certified actuary" means:
(A) a fellow of the Society of Actuaries;
(B) a fellow of the Casualty Actuarial Society;
or
(C) a member of the American Academy of
Actuaries.
(2) "Health care benefit mandate" means a state law
that requires a health benefit plan to provide coverage or
reimbursement for a specific health care service, treatment, or
procedure, a specific medical condition or illness, or a particular
group of people who would otherwise be excluded, or to reimburse a
specific type of health care provider directly or in a specific
amount. The term does not include an offer of coverage mandate.
(3) "Offer of coverage mandate" means a state law that
requires a health benefit plan to offer as part of the plan's
benefit schedule coverage that may be rejected by the contract
holder and for which an additional premium may be charged.
Art. 28.002. DEFINITION OF HEALTH BENEFIT PLAN. (a) In
this chapter, "health benefit plan" means a plan that provides
benefits for medical or surgical expenses incurred as a result of a
health condition, accident, or sickness, including an individual,
group, blanket, or franchise insurance policy or insurance
agreement, a group hospital service contract, or an individual or
group evidence of coverage or similar coverage document that is
offered by:
(1) an insurance company;
(2) a group hospital service corporation operating
under Chapter 842 of this code;
(3) a fraternal benefit society operating under
Chapter 885 of this code;
(4) a stipulated premium insurance company operating
under Chapter 884 of this code;
(5) an exchange operating under Chapter 942 of this
code;
(6) a health maintenance organization operating under
Chapter 843 of this code;
(7) a multiple employer welfare arrangement that holds
a certificate of authority under Chapter 846 of this code;
(8) an approved nonprofit health corporation that
holds a certificate of authority under Chapter 844 of this code; or
(9) a Lloyd's plan operating under Chapter 941 of this
code.
(b) "Health benefit plan" does not include:
(1) a plan that provides coverage only:
(A) for benefits for a specified disease or for
another limited benefit other than for cancer;
(B) for accidental death or dismemberment;
(C) for wages or payments in lieu of wages for a
period during which an employee is absent from work because of
sickness or injury;
(D) as a supplement to a liability insurance
policy;
(E) for credit insurance;
(F) for dental or vision care; or
(G) for indemnity for hospital confinement;
(2) a Medicare supplemental policy as defined by
Section 1882(g)(1), Social Security Act (42 U.S.C. Section 1395ss),
as amended;
(3) a workers' compensation insurance policy;
(4) medical payment insurance coverage provided under
a motor vehicle insurance policy; or
(5) a long-term care insurance policy, including a
nursing home fixed indemnity policy, unless the commissioner
determines that the policy provides benefit coverage so
comprehensive that the policy is a health benefit plan as described
by Subsection (a) of this article.
[Articles 28.003-28.050 reserved for expansion]
SUBCHAPTER B. IMPACT ASSESSMENT OF PROPOSED MANDATE
BY LEGISLATIVE BUDGET BOARD
Art. 28.051. REQUEST FOR IMPACT ASSESSMENT. If the chair of
a standing committee of the legislature determines that a bill
would, if enacted, create a health care benefit mandate or an offer
of coverage mandate, the chair shall send a copy of the bill to the
Legislative Budget Board and request that an impact assessment of
the mandate be prepared.
Art. 28.052. PREPARATION OF IMPACT ASSESSMENT; ACTUARIAL
ASSISTANCE REQUIRED. (a) On receipt of a bill under Article 28.051
of this code, the Legislative Budget Board shall prepare a written
impact assessment of the mandate in accordance with this
subchapter.
(b) In preparing an impact assessment, the director of the
Legislative Budget Board may:
(1) use any information supplied by any person,
agency, organization, or governmental unit that the director
determines is reliable; and
(2) obtain assistance in preparing the assessment from
any state agency or by contract with a private entity.
(c) The Legislative Budget Board shall obtain the
assistance of at least one certified actuary who is qualified to
provide an opinion relating to an impact assessment under this
subchapter.
(d) An impact assessment prepared under this subchapter
must include:
(1) any report relating to the mandate produced by an
actuary or other expert retained by the Legislative Budget Board;
and
(2) a description of all underlying assumptions, data,
and studies on which the evaluation was based.
(e) The director of the Legislative Budget Board shall
submit an impact assessment requested under Article 28.051 of this
code not later than the 21st day after the date of the request.
Art. 28.053. CONTENTS OF IMPACT ASSESSMENT. (a) An impact
assessment of a health care benefit mandate or offer of coverage
mandate prepared under this subchapter must include, as applicable:
(1) the level of demand in the state for the coverage
that is the subject of the mandate, including the number and
percentage of people in the state who are affected by the medical
condition or illness that is the subject of the mandate or who would
be likely to use the coverage that is the subject of the mandate;
(2) the extent to which the coverage is available
under health benefit plans that are in effect at the time the impact
assessment is made;
(3) the extent to which any health care service,
treatment, or procedure that would be required under the mandate
would be available in the absence of health benefit plan coverage;
(4) the epidemiological impact and medical efficacy of
the health care service, treatment, or procedure, including the
impact of the service, treatment, or procedure on an individual's
health status and the effect on an individual's health status of not
providing the service, treatment, or procedure;
(5) the direct impact of the mandate on health benefit
plan premiums;
(6) the net impact of the mandate on premiums,
considering the extent to which the coverage is already provided
under health benefit plans that are in effect at the time the impact
assessment is made and the extent to which other costs are offset by
the mandate;
(7) the costs to an individual of obtaining the health
care service, treatment, or procedure in the absence of health
benefit plan coverage;
(8) the fiscal impact on the state associated with
enacting the mandate and with not enacting the mandate;
(9) the impact on the economy and society of not
providing the health care service, treatment, or procedure;
(10) the impact of the health care service, treatment,
or procedure on the use of sick days and disability costs;
(11) the relative quality and cost-efficiency of the
care that is the subject of the mandate in the absence of health
benefit plan coverage; and
(12) a description of the extent to which the health
care benefit mandate or offer of coverage mandate is required by
federal law and the consequences of not enacting a mandate that
includes the minimum requirements of the federal law.
(b) For an offer of coverage mandate, the impact assessment
must also estimate the difference in the cost of a health benefit
plan that provides the coverage and a comparable health benefit
plan that does not provide the coverage.
(c) For a health care benefit mandate, the impact assessment
must also estimate the impact of the mandate if the mandate was an
offer of coverage mandate.
(d) An impact assessment must provide a separate analysis of
the cost to the Employees Retirement System of Texas of providing
the coverage that is the subject of the mandate being assessed to
the population covered by the uniform group insurance program or a
successor program, even if the program would not be subject to the
mandate.
(e) An impact assessment must provide a separate analysis of
the costs of the health benefit plan mandate or offer of coverage
mandate for:
(1) group health benefit plans, collectively and
according to the type of plan;
(2) individual health benefit plans; and
(3) small employer health benefit plans written under
Chapter 26 of this code, even if those plans would not be subject to
the mandate.
Art. 28.054. IMPACT ASSESSMENT IN CERTAIN CIRCUMSTANCES.
If the director of the Legislative Budget Board determines that the
impact of a proposed health benefit plan mandate or offer of
coverage mandate cannot be fully ascertained or the director is
unable to acquire or develop sufficient information to prepare a
complete impact assessment within 21 days of receiving the bill
from the chair of a committee, the director shall:
(1) report that fact in writing to the chair of the
committee; and
(2) prepare an impact assessment that:
(A) complies as much as possible with the
requirements of Article 28.053 of this code; and
(B) explains which of the applicable
requirements of that article are not met and why they are not met.
Art. 28.055. DISTRIBUTION OF IMPACT ASSESSMENT. Copies of
an impact assessment prepared under this subchapter must be
distributed to the members of the committee before the committee
votes on the bill to which the assessment relates. The assessment
shall be attached to the bill on first printing. If the bill is
amended by the committee in a way that alters a mandate, the chair
shall obtain an updated impact assessment, which shall also be
attached to the bill on first printing.
Art. 28.056. IMPACT ASSESSMENT REMAINS WITH BILL. An
impact assessment prepared under this subchapter shall remain with
the bill to which the assessment relates throughout the entire
legislative process, including submission to the governor.
[Articles 28.057-28.100 reserved for expansion]
SUBCHAPTER C. ASSESSMENT OF ENACTED MANDATE BY SUNSET
ADVISORY COMMISSION; EXPIRATION OF MANDATE
Art. 28.101. DEFINITION. In this subchapter, "review date"
means the review date assigned by the commissioner to a health care
benefit mandate or offer of coverage mandate under Article 28.103
of this code.
Art. 28.102. APPLICABILITY OF SUBCHAPTER. This subchapter
applies to a health care benefit mandate or offer of coverage
mandate provided for:
(1) in a statute; or
(2) in a rule adopted by the commissioner.
Art. 28.103. REVIEW DATES. (a) The commissioner shall
assign a review date to each health care benefit mandate or offer of
coverage mandate.
(b) In assigning review dates, the commissioner shall:
(1) consider the amount of time a mandate has been in
effect and whether the mandate has been substantially amended since
the mandate became effective; and
(2) except as provided by Subsection (c) of this
article, and to the extent possible while complying with Subsection
(d) of this article, assign review dates to mandates according to
the amount of time the mandates have been in effect in substantially
the same form, with the mandates that have been in effect in
substantially the same form for the longest period having the
earliest review dates.
(c) The commissioner may assign the same review date to
mandates that are substantially similar or substantively related to
each other.
(d) Except as provided by this subsection, the commissioner
may not assign the same review date to more than five mandates. If
the commissioner assigns the same review date to mandates that are
substantially similar or substantively related to each other, the
commissioner may count those mandates as one mandate for the
purposes of this subsection.
(e) The review date:
(1) must be September 1 of an even-numbered year; and
(2) may not be earlier than September 1 of the
even-numbered year following the fifth anniversary of the date the
mandate is adopted.
(f) Notwithstanding Subsection (e) of this article, for a
mandate that was adopted on or before September 1, 2001, the review
date may not be earlier than September 1, 2006. This subsection
expires December 31, 2007.
Art. 28.104. ASSESSMENT OF MANDATE. (a) Before the review
date for a health care benefit mandate or an offer of coverage
mandate, the Sunset Advisory Commission shall:
(1) review and take action necessary to verify the
reports relating to the mandate submitted by the department and the
Texas Department of Health under Article 28.156 of this code;
(2) conduct an assessment of the mandate based on the
criteria provided by Article 28.107 of this code and prepare a
written report; and
(3) review any prior commission recommendations
relating to the mandate in reports presented to the legislature
under this subchapter in a preceding legislative session.
(b) A report prepared by the Sunset Advisory Commission
under this article is a public record.
Art. 28.105. PUBLIC HEARINGS. (a) Between the review date
for a health care benefit mandate or offer of coverage mandate and
December 1 of the calendar year in which the review date occurs, the
Sunset Advisory Commission shall conduct public hearings
concerning the assessment of the mandate provided by Article 28.107
of this code.
(b) The Sunset Advisory Commission may hold public hearings
under this article before the review date if the report required
under Article 28.104 is complete and available to the public.
Art. 28.106. REPORT; RECOMMENDATION. (a) Not later than
January 1 of the year of a regular legislative session, the Sunset
Advisory Commission shall present to the legislature and the
governor a report on each health care benefit mandate or offer of
coverage mandate that was assessed under this subchapter during the
previous year.
(b) In the report the Sunset Advisory Commission shall
include:
(1) the specific findings of the commission regarding
each of the criteria considered under Article 28.107 of this code;
(2) recommendations of the commission regarding
whether the mandate should be continued, modified, or repealed; and
(3) any other information the commission considers
necessary for a complete assessment of the mandate.
Art. 28.107. CRITERIA FOR ASSESSMENT. (a) The Sunset
Advisory Commission and the commission's staff, in determining
whether a health care benefit mandate or an offer of coverage
mandate should be continued, modified, or repealed, shall consider,
as applicable:
(1) the level of demand in the state for the coverage
that is the subject of the mandate, including the number and
percentage of people, statewide and among distinct population
groups, who are affected by the medical condition or illness that is
the subject of the mandate or who use the coverage that is the
subject of the mandate;
(2) the extent to which any health care service,
treatment, or procedure that would be required under the mandate
would be available in the absence of health benefit plan coverage;
(3) the epidemiological impact and medical efficacy of
the health care service, treatment, or procedure, including the
impact of the service, treatment, or procedure on an individual's
health status and the effect on an individual's health status of not
providing the service, treatment, or procedure;
(4) the direct impact of the mandate on health benefit
plan premiums;
(5) the net impact of the mandate on premiums,
considering the extent to which other costs are offset by the
mandate;
(6) the costs to an individual of obtaining the health
care service, treatment, or procedure in the absence of health
benefit plan coverage;
(7) the fiscal impact on the state associated with
continuing the mandate and with repealing the mandate;
(8) the impact on the economy and society of not
providing the health care service, treatment, or procedure;
(9) the impact of the health care service, treatment,
or procedure on the use of sick days and disability costs;
(10) the relative quality and cost-efficiency of the
care that is the subject of the mandate in the absence of health
benefit plan coverage; and
(11) the extent to which the mandate being assessed is
required by federal law and the consequences of repealing the
mandate or continuing the mandate in a form that does not include
the minimum requirements of the federal law.
(b) In considering a mandate's impact on health benefit plan
premiums under Subsection (a) of this article, the Sunset Advisory
Commission and the commission's staff shall, if applicable, provide
a separate analysis of the impact of a health care benefit mandate
or offer of coverage mandate on:
(1) group health benefit plans collectively and
according to the type of plan;
(2) individual health benefit plans; and
(3) small employer health benefit plans written under
Chapter 26 of this code.
Art. 28.108. PREPARATION OF REPORT; ACTUARIAL ASSISTANCE
REQUIRED. (a) The Sunset Advisory Commission may contract with any
person to provide actuarial, medical, or economic expertise or
other expertise or services as necessary to allow the commission to
prepare a report required under this subchapter.
(b) The Sunset Advisory Commission shall obtain the
assistance of at least one certified actuary who is qualified to
provide an opinion relating to a report under this subchapter.
Art. 28.109. CONTINUATION OF MANDATE. (a) A health care
benefit mandate or offer of coverage mandate shall continue in
effect until such time as the legislature acts on the
recommendation of the commission according to Article 28.106 of
this code.
(b) A health care benefit mandate or offer of coverage
mandate reviewed under this subchapter may not be assigned a
subsequent review date that is earlier than the 12th anniversary of
the preceding review date.
(c) A mandate may be modified at the time the mandate is
continued.
(d) This subchapter does not prohibit the legislature from:
(1) repealing a health care benefit mandate or offer
of coverage mandate; or
(2) considering any other legislation relating to a
mandate.
[Articles 28.110-28.150 reserved for expansion]
SUBCHAPTER D. COLLECTION AND REPORTING OF DATA
Art. 28.151. DEFINITION OF LARGE HEALTH BENEFIT PLAN
CARRIER. The commissioner by rule shall define "large health
benefit plan carrier" for the purposes of Article 28.152 of this
code. The commissioner shall obtain the assistance of the advisory
committee established under Article 28.153 of this code in
formulating the definition. The definition must:
(1) be based on the carrier's premium volume or number
of enrollees covered by the carrier's plans; and
(2) describe a sufficient number of carriers to
fulfill the purposes of this subchapter, but not less than the
lesser of:
(A) 15 carriers; or
(B) all carriers operating in this state.
Art. 28.152. REQUIRED INFORMATION. (a) The commissioner
by rule shall require each large health benefit plan carrier and the
Employees Retirement System of Texas to submit annually information
that the commissioner, with the assistance of the advisory
committee established under Article 28.153 of this code, determines
is necessary for the assessment of health care benefit mandates and
offer of coverage mandates under this chapter.
(b) A large health benefit plan carrier shall submit
information required by the commissioner under this article.
(c) The Employees Retirement System of Texas shall submit
information required by the commissioner under this article.
Art. 28.153. ADVISORY COMMITTEE. (a) The commissioner
shall appoint an advisory committee of at least seven and not more
than 11 members to assist the department in implementing this
subchapter.
(b) The members of the committee must include at least one
representative from each of the following groups or entities:
(1) large health benefit plan carriers that are
insurers;
(2) large health benefit plan carriers that are health
maintenance organizations;
(3) consumers;
(4) health care providers;
(5) the Texas Department of Health; and
(6) the Texas Health Care Information Council.
(c) The committee must also include members who have
demonstrated actuarial, economic, and information systems
expertise.
(d) The committee shall work with the department to ensure
that:
(1) data collected under this subchapter is
sufficient to properly evaluate each health care benefit mandate
and offer of coverage mandate under Subchapter C of this chapter;
(2) compliance with requests for data made under this
subchapter is both feasible for health benefit plan carriers and as
cost-effective as possible; and
(3) to the extent possible, data collection formats
under this subchapter are compatible with data collection formats
required under Section 221(a), Health Insurance Portability and
Accountability Act of 1996 (42 U.S.C. Section 1320a-7e).
(e) Chapter 2110, Government Code, applies to the advisory
committee created under this article.
Art. 28.154. CERTAIN INFORMATION EXCLUDED. The department
may not collect information under this subchapter that could
reasonably be expected to reveal the identity of a patient or a
health care provider other than a hospital.
Art. 28.155. APPLICABILITY OF OPEN RECORDS LAW.
Information submitted under this subchapter by an individual health
benefit plan carrier is not subject to disclosure under Chapter
552, Government Code. The department shall aggregate information
submitted by all health benefit plan carriers under this
subchapter, and that aggregated information is subject to
disclosure under Chapter 552, Government Code.
Art. 28.156. REPORTING OF DATA. (a) Before July 1 of the
calendar year in which the review date assigned to a health care
benefit mandate or an offer of coverage mandate under Article
28.103 of this code occurs:
(1) the department shall report to the Sunset Advisory
Commission:
(A) information regarding the costs associated
with the mandate, including the claims paid under health benefit
plans that are related to the mandate and the premiums charged for
coverage required by the mandate; and
(B) any other information that the commissioner
considers appropriate or that is requested by the Sunset Advisory
Commission to the extent that the information is available; and
(2) the Texas Department of Health shall report to the
Sunset Advisory Commission:
(A) information regarding the epidemiological
impact and the medical efficacy of the coverage required by the
mandate, if applicable; and
(B) any other information that the commissioner
of public health considers appropriate or that is requested by the
Sunset Advisory Commission.
(b) The department and the Texas Department of Health shall
provide, to the extent the information is available to the agency,
any information requested by the Legislative Budget Board for the
purpose of preparing an impact assessment under Subchapter B of
this chapter.
SECTION 2. Subchapter F, Chapter 38, Insurance Code, as
added by Chapter 852, Acts of the 77th Legislature, Regular
Session, 2001, is repealed.
SECTION 3. (a) This Act takes effect September 1, 2003.
(b) Not later than December 1, 2003, the commissioner of
insurance shall appoint all members to the advisory committee
authorized under Article 28.153, Insurance Code, as added by this
Act. Not later than June 1, 2004, the commissioner of insurance
shall adopt rules as necessary to implement Subchapters C and D,
Chapter 28, Insurance Code, as added by this Act.