Amend SB 1637 by striking all below the enacting clause and 
substituting the following:
	SECTION 1.  Chapter 1501, Insurance Code, is amended by 
adding Subchapter I to read as follows:

SUBCHAPTER I.  SMALL EMPLOYER PREMIUM ASSISTANCE PROGRAM
	Sec. 1501.401.  DEFINITIONS.  In this subchapter:                       
		(1)  "Commission" means the Health and Human Services 
Commission.    
		(2)  "Program" means the small employer premium 
assistance program.  
	Sec. 1501.402.  PROGRAM DEVELOPMENT.  The department and the 
commission shall jointly develop a small employer premium 
assistance program designed to provide financial assistance for the 
purchase of small employer health benefit plans by small employers.
	Sec. 1501.403.  CONSOLIDATION OF PROGRAM DESIGN.  In 
developing the program, the department and the commission shall 
consider:
		(1)  targeting small employers;                                        
		(2)  provisions to limit employers and others from 
electing to discontinue other private coverage for employees;
		(3)  establishing a minimum percentage of premium that 
a small employer must pay for the premium of each eligible 
employee's coverage;
		(4)  limiting the eligibility of enrollees for whom 
financial assistance is provided to individuals at or below 300 
percent of the federal poverty level based on the federal Office of 
Management and Budget poverty index;
		(5)  allocating available opportunities for enrollment 
in the program to geographic regions of the state, based on the 
percentage of the state's small employers that are located in each 
region;
		(6)  establishing that enrollment in the program is 
valid for one year and may be renewed in accordance with procedures 
established by the department and the commission;
		(7)  a process to verify that small employers 
participating in the program use premium assistance to purchase and 
maintain a small employer health benefit plan; and
		(8)  programs and efforts undertaken by other states to 
provide premium assistance to small employers.
	Sec. 1501.404.  COORDINATION WITH OTHER EFFORTS.  The 
department and the commission shall ensure that efforts to develop 
a small employer premium assistance program are consistent with any 
other premium assistance effort operated, under development, or 
under consideration by either agency.
	SECTION 2.  Subdivision (16), Section 1501.002, Insurance 
Code, is amended to read as follows:
		(16)  "Small employer health benefit plan issuer" means 
a health benefit plan issuer, to the extent that the issuer is 
offering, delivering, issuing for delivery, or renewing health 
benefit plans subject to Subchapters C-I [C-H].
	SECTION 3.  Section 1501.003, Insurance Code, is amended to 
read as follows: 
	Sec. 1501.003.  APPLICABILITY:  SMALL EMPLOYER HEALTH 
BENEFIT PLANS.  An individual or group health benefit plan is a 
small employer health benefit plan subject to Subchapters C-I [C-H] 
if it provides health care benefits covering two or more eligible 
employees of a small employer and:
		(1)  the employer pays a portion of the premium or 
benefits;                
		(2)  the employer or a covered individual treats the 
health benefit plan as part of a plan or program for purposes of 
Section 106 or 162, Internal Revenue Code of 1986 (26 U.S.C. Section 
106 or 162); or
		(3)  the health benefit plan is an employee welfare 
benefit plan under 29 C.F.R. Section 2510.3-1(j).
	SECTION 4.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2007.