Amend CSHB 1977 (Senate committee printing) as follows:
(1) Add the following new SECTIONS to the bill,
appropriately numbered:
SECTION __. Section 1506.001, Insurance Code, is amended
by adding Subdivisions (1-a) through (1-e) and (8) to read as
follows:
(1-a) "Church plan" has the meaning assigned by
Section 3(33), Employee Retirement Income Security Act of 1974 (29
U.S.C. Section 1002(33)).
(1-b) "Creditable coverage" means, with respect to an
individual, coverage of the individual provided under any of the
following:
(A) a group health plan;
(B) health insurance coverage;
(C) Part A or Part B, Title XVIII, Social
Security Act (42 U.S.C. Section 1395c et seq.);
(D) Title XIX, Social Security Act (42 U.S.C.
Section 1396 et seq.), other than coverage consisting solely of
benefits under Section 1928 of that Act (42 U.S.C. Section 1396s);
(E) 10 U.S.C. Section 1071 et seq.;
(F) a medical care program of the Indian Health
Service or a tribal organization;
(G) a state health benefits risk pool;
(H) a health benefits plan offered under 5 U.S.C.
Section 8901 et seq.;
(I) a public health plan as defined in federal
regulations;
(J) a health benefit plan under Section 5(e),
Peace Corps Act (22 U.S.C. Section 2504(e)); or
(K) a state child health plan provided under
Title XXI, Social Security Act (42 U.S.C. Section 1397aa et seq.).
(1-c) "Federally defined eligible individual" means
an individual:
(A) for whom, as of the date on which the
individual seeks coverage under this chapter, the aggregate period
of creditable coverage is 18 months or more;
(B) whose most recent prior creditable coverage
was under:
(i) a group health plan, governmental plan,
or church plan; or
(ii) health insurance coverage offered in
connection with a plan described by Subparagraph (i);
(C) who is not eligible for coverage under a
group health plan, Part A or Part B, Title XVIII, Social Security
Act (42 U.S.C. Section 1395c et seq.), or a state plan under Title
XIX, Social Security Act (42 U.S.C. Section 1396 et seq.), or any
successor program, and who does not have other health benefit plan
coverage;
(D) with respect to whom the most recent coverage
within the aggregate creditable coverage was not terminated based
on a factor relating to nonpayment of premiums or fraud;
(E) who, if offered the option of continuation
coverage under a continuation provision required by Title X,
Consolidated Omnibus Budget Reconciliation Act of 1985 (29 U.S.C.
Section 1161 et seq.) (COBRA), or under a similar state program,
elected that coverage; and
(F) who has exhausted continuation coverage, if
elected, under Paragraph (E).
(1-d) "Governmental plan" has the meaning assigned by
Section 3(32), Employee Retirement Income Security Act of 1974 (29
U.S.C. Section 1002(32)), and includes any United States
governmental plan.
(1-e) "Group health plan" means an employee welfare
benefit plan as defined by Section 3(1), Employee Retirement Income
Security Act of 1974 (29 U.S.C. Section 1002(1)), to the extent that
the plan provides health benefit plan coverage to employees or
their dependents as defined under the terms of the plan, directly or
through insurance, reimbursement, or otherwise.
(8) "Significant break in coverage" means a period of
63 consecutive days during all of which the individual does not have
health benefit plan coverage, except that a waiting period or an
affiliation period is not considered in determining a significant
break in coverage.
SECTION __. Section 1506.002, Insurance Code, is amended by
amending Subsection (b) and adding Subsections (c) and (d) to read
as follows:
(b) In this chapter, "health benefit plan" does not include
one or more or any combination of the following:
(1) coverage only for accident or disability income
insurance or any combination of those coverages;
(2) credit-only [a plan providing coverage only for
dental or vision care;
[(3) fixed indemnity insurance, including hospital
indemnity insurance;
[(4) credit] insurance;
(3) [(5) long-term care insurance;
[(6) disability income insurance;
[(7) other limited benefit coverage, including
specified disease coverage;
[(8)] coverage issued as a supplement to liability
insurance;
(4) liability insurance, including general liability
insurance and automobile liability insurance;
(5) [(9) insurance arising out of a] workers'
compensation [law] or similar insurance [law];
(6) coverage for on-site medical clinics;
(7) [(10)] automobile medical payment insurance; [or]
(8) [(11)] insurance coverage under which benefits
are payable with or without regard to fault and that is statutorily
required to be contained in a liability insurance policy or
equivalent self-insurance; or
(9) other similar insurance coverage, specified by
federal regulations issued under the Health Insurance Portability
and Accountability Act of 1996 (Pub. L. No. 104-191), under which
benefits for medical care are secondary or incidental to other
insurance benefits.
(c) In this chapter, "health benefit plan" does not include
the following benefits if they are provided under a separate
policy, certificate, or contract of insurance, or are otherwise not
an integral part of the coverage:
(1) limited scope dental or vision benefits;
(2) benefits for long-term care, nursing home care,
home health care, community-based care, or any combination of these
benefits; or
(3) other similar, limited benefits specified by
federal regulations issued under the Health Insurance Portability
and Accountability Act of 1996 (Pub. L. No. 104-191).
(d) In this chapter, "health benefit plan" does not include
the following benefits if the benefits are provided under a
separate policy, certificate, or contract of insurance, there is no
coordination between the provision of the benefits and any
exclusion of benefits under any group health plan maintained by the
same plan sponsor, and the benefits are paid with respect to an
event without regard to whether benefits are provided with respect
to such an event under any group health plan maintained by the same
plan sponsor:
(1) coverage only for a specified disease or illness;
or
(2) hospital indemnity or other fixed indemnity
insurance.
SECTION __. Subsection (a), Section 1506.151, Insurance
Code, is amended to read as follows:
(a) The pool shall offer coverage consistent with major
medical expense coverage to each eligible individual [who is under
the age of 65].
SECTION __. Subsection (a), Section 1506.152, Insurance
Code, is amended to read as follows:
(a) An individual who is a legally domiciled resident of
this state is eligible for coverage from the pool if the individual:
(1) provides to the pool evidence that the individual
is a federally defined eligible individual who has not experienced
a significant break in coverage [maintained health benefit plan
coverage for the preceding 18 months with no gap in coverage longer
than 63 days and with the most recent coverage being provided
through an employer-sponsored plan, church plan, or government
plan];
(2) is younger than 65 years of age and provides to the
pool evidence that the individual maintained health benefit plan
coverage under another state's qualified Health Insurance
Portability and Accountability Act health program that was
terminated because the individual did not reside in that state and
submits an application for pool coverage not later than the 63rd day
after the date the coverage described by this subdivision was
terminated;
(3) is younger than 65 years of age and has been a
legally domiciled resident of this state for the preceding 30 days,
is a citizen of the United States or has been a permanent resident
of the United States for at least three continuous years, and
provides to the pool:
(A) a notice of rejection of, or refusal to
issue, substantially similar individual health benefit plan
coverage from a health benefit plan issuer, other than an insurer
that offers only stop-loss, excess loss, or reinsurance coverage,
if the rejection or refusal was for health reasons;
(B) certification from an agent or salaried
representative of a health benefit plan issuer that states that the
agent or salaried representative cannot obtain substantially
similar individual coverage for the individual from any health
benefit plan issuer that the agent or salaried representative
represents because, under the underwriting guidelines of the health
benefit plan issuer, the individual will be denied coverage as a
result of a medical condition of the individual;
(C) an offer to issue substantially similar
individual coverage only with conditional riders;
(D) a diagnosis of the individual with one of the
medical or health conditions on the list adopted under Section
1506.154; or
(E) evidence that the individual is covered by
substantially similar individual coverage that excludes one or more
conditions by rider; or
(4) provides to the pool evidence that, on the date of
application to the pool, the individual is certified as eligible
for trade adjustment assistance or for pension benefit guaranty
corporation assistance, as provided by the Trade Adjustment
Assistance Reform Act of 2002 (Pub. L. No. 107-210).
SECTION __. Section 1506.153, Insurance Code, as amended by
Chapters 728 and 824, Acts of the 79th Legislature, Regular
Session, 2005, is amended to read as follows:
Sec. 1506.153. INELIGIBILITY FOR COVERAGE.
Notwithstanding Section 1506.152 [Sections 1506.152(a)-(d)], an
individual is not eligible for coverage from the pool if:
(1) on the date pool coverage is to take effect, the
individual has health benefit plan coverage from a health benefit
plan issuer or health benefit arrangement in effect, except as
provided by Section 1506.152(a)(3)(E);
(2) at the time the individual applies to the pool, the
individual is eligible for other health care benefits, including an
offer of benefits from the continuation of coverage under Title X,
Consolidated Omnibus Budget Reconciliation Act of 1985 (29 U.S.C.
Section 1161 et seq.), as amended (COBRA), other than:
(A) coverage, including COBRA or other
continuation coverage or conversion coverage, maintained for any
preexisting condition waiting period under a pool policy or during
any preexisting condition waiting period or other waiting period of
the other coverage;
(B) employer group coverage conditioned by a
limitation of the kind described by Section 1506.152(a)(3)(A) or
(C); or
(C) individual coverage conditioned by a
limitation described by Section 1506.152(a)(3)(C) or (D);
(3) within 12 months before the date the individual
applies to the pool, the individual terminated coverage in the
pool, unless the individual:
(A) demonstrates a good faith reason for the
termination; or
(B) is a federally defined eligible individual;
(4) the individual is confined in a county jail or
imprisoned in a state or federal prison;
(5) any of the individual's premiums are paid for or
reimbursed under a government-sponsored program or by a government
agency or health care provider[, other than as an otherwise
qualifying full-time employee of a government agency or health care
provider or as a dependent of such an employee];
(6) the individual's prior coverage with the pool was
terminated:
(A) during the 12-month period preceding the date
of application for nonpayment of premiums; or
(B) for fraud; or
(7) the individual is eligible for health benefit plan
coverage provided in connection with a policy, plan, or program
paid for or sponsored by an employer, even though the employer
coverage is declined.
SECTION __. Subsection (a), Section 1506.154, Insurance
Code, is amended to read as follows:
(a) The board shall adopt a list of medical or health
conditions for which an individual is eligible for pool coverage
under Section 1506.152(a)(3)(D) [1506.152(a)(3)(E)] without
applying for health benefit plan coverage.
SECTION __. Subsections (b) and (c), Section 1506.155,
Insurance Code, are amended to read as follows:
(b) The exclusion provided by Subsection (a) does not apply
to a federally defined eligible individual or an individual who:
(1) was continuously covered for a period of at least
12 months, excluding any waiting period, by creditable [health
benefit plan] coverage that terminated not earlier than the 63rd
day before the effective date of coverage under the pool; and
(2) applied for pool coverage not later than the 63rd
day after the date the creditable [health benefit plan] coverage
described by Subdivision (1) terminated.
(c) If an individual was covered by creditable [health
benefit plan] coverage that was in effect at any time during the
12-month period preceding the effective date of the individual's
coverage under the pool, the pool shall subtract from the exclusion
period required under Subsection (a) the period that the individual
was covered under that creditable coverage [health benefit plan]
and any waiting period that applied before that creditable [health
benefit plan] coverage became effective.
SECTION __. Subsection (a), Section 1506.202, Insurance
Code, is amended to read as follows:
(a) The board may, on a competitive bid basis, contract with
[select] one or more health benefit plan issuers or [a] third-party
administrators [administrator] authorized by the department to
administer the pool. [The selection must be made under a
competitive bidding process in accordance with the plan of
operation.]
SECTION __. Section 1506.203, Insurance Code, is amended to
read as follows:
Sec. 1506.203. ADMINISTRATOR'S CONTRACT [TERM; SUCCEEDING
TERM]. (a) A person selected as a pool administrator shall serve
[serves] in that capacity for a period specified in the contract
between the pool and the pool administrator, subject to removal for
cause and subject to any terms, conditions, and limitations of the
contract between the pool and the pool administrator. The term of
the contract must be at least three years and may be extended, in
the board's sole discretion, for up to a total term of six years
[three-year term beginning on the date the board issues its order
making the selection].
(b) Not later than one year before the expiration date of a
pool administrator's contract, including any board-authorized
extensions of that contract [term], the board shall invite all
health benefit plan issuers, including the pool administrator, to
submit bids to serve as a pool administrator for the succeeding
administration period. The selection of the succeeding pool
administrator must be made not later than the sixth calendar month
preceding the month in which the pool administrator's contract
[term] expires.
SECTION __. Subsection (b), Section 1506.254, Insurance
Code, is amended to read as follows:
(b) Interest accrues on the unpaid amount of an assessment
at a rate equal to the prime lending rate, as published in the most
recent issue of the Wall Street Journal and determined as of the
first day of each month during which [date] the assessment is
[becomes] delinquent, plus three percent.
(2) In SECTION 6 of the bill, between "SECTION 6." and "The
change" (page 2, line 36), insert "(a)".
(3) In SECTION 6 of the bill, at the end of that SECTION
(page 2, between lines 43 and 44), insert:
(b) This Act applies only to an application for initial or
renewal coverage through the Texas Health Insurance Risk Pool under
Chapter 1506, Insurance Code, as amended by this Act, that is filed
with the pool on or after January 1, 2008. An application filed
before January 1, 2008 is governed by the law in effect on the date
on which the application was filed, and the former law is continued
in effect for that purpose.
(c) The change in law made by this Act to Subsection (b),
Section 1506.254, Insurance Code, applies to an assessment under
Subchapter F, Chapter 1506, Insurance Code, for a calendar year
beginning on or after January 1, 2008. An assessment for a calendar
year before January 1, 2008, is governed by the law in effect during
the period for which the assessment is made, and the former law is
continued in effect for that purpose.
(4) In SECTION 7 of the bill, strike "This Act takes effect"
(page 2, line 44) and substitute "(a) Except as provided by
Subsection (b) of this section, this Act takes effect".
(5) In SECTION 7 of the bill, at the end of that SECTION
(page 2, between lines 48 and 49), insert:
(b) The change in law made by this Act to Sections 1506.001,
1506.002, 1506.151, 1506.152, 1506.153, 1506.154, 1506.155,
1506.202, 1506.203, and 1506.254, Insurance Code, takes effect
January 1, 2008.