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A BILL TO BE ENTITLED
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AN ACT
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relating to the creation of a voluntary consumer-directed health |
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plan for certain individuals eligible to participate in the |
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insurance coverage provided under the Texas Employees Group |
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Benefits Act and their qualified dependents. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 1551, Insurance Code, is amended by |
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adding Subchapter J to read as follows: |
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SUBCHAPTER J. STATE CONSUMER-DIRECTED HEALTH PLAN |
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Sec. 1551.451. DEFINITIONS. In this subchapter: |
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(1) "High deductible health plan" means a health |
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benefit plan that complies with Section 223(c), Internal Revenue |
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Code of 1986, and other federal law. |
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(2) "Participant" means an individual who is: |
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(A) eligible to participate in the group benefits |
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program; and |
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(B) enrolled in the plan established under this |
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subchapter. |
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(3) "Qualified medical expense" means an expense paid |
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by a participant for medical care, as defined by Section 213(d), |
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Internal Revenue Code of 1986, for the participant or the |
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participant's dependents as defined by Section 152, Internal |
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Revenue Code of 1986. |
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Sec. 1551.452. ESTABLISHMENT OF STATE CONSUMER-DIRECTED |
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HEALTH PLAN. (a) The state consumer-directed health plan is |
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established for the benefit of individuals eligible to participate |
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in the group benefits program and those individuals' eligible |
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dependents. |
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(b) After the board of trustees adopts rules necessary to |
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administer this subchapter, the board shall: |
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(1) establish health savings accounts under this |
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subchapter and administer or select an administrator for the |
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accounts; |
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(2) finance or purchase a high deductible health plan |
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that: |
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(A) is an integral part of the state |
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consumer-directed health plan; and |
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(B) provides health benefit coverage, including |
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preventative health care, to a participant enrolled in the state |
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consumer-directed health plan and to the dependents of an enrolled |
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participant in accordance with Section 1551.456; and |
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(3) provide to individuals eligible to participate in |
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the group benefits program information regarding the option to |
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participate in and operation of the state consumer-directed health |
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plan established under this subchapter. |
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(c) If the board of trustees purchases a high deductible |
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health plan under this subchapter, Sections 1551.215-1551.218 |
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apply to the high deductible health plan. |
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(d) In adopting rules and administering health savings |
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accounts or selecting administrators for health savings accounts |
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under this subchapter, the board of trustees shall ensure that the |
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health savings accounts are qualified for appropriate federal tax |
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exemptions. |
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Sec. 1551.453. PARTICIPATION IN STATE CONSUMER-DIRECTED |
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HEALTH PLAN; EFFECT OF PARTICIPATION. (a) The board of trustees |
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shall give individuals eligible to participate in the basic |
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coverage plan the option of waiving participation in the basic |
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coverage plan and participating in the state consumer-directed |
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health plan instead. |
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(b) For purposes of this chapter, participation in the state |
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consumer-directed health plan is considered participation in the |
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group benefits program, and Sections 1551.301, 1551.303, 1551.305, |
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and 1551.306 apply to participation in the state consumer-directed |
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health plan in the same manner that those sections apply to the |
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basic coverage plan. |
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Sec. 1551.454. ACCOUNT ADMINISTRATOR. (a) The account |
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administrator selected to administer a health savings account |
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established under this subchapter must be a person: |
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(1) qualified to serve as trustee under Section |
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223(d)(1)(B), Internal Revenue Code of 1986, and the rules adopted |
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under that section; and |
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(2) experienced in administering health savings |
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accounts or other similar trust accounts. |
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(b) An account administrator is the fiduciary of a |
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participant who has a health savings account established under this |
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subchapter. |
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(c) Section 1551.056(b) does not apply to the account |
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administrator. |
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Sec. 1551.455. PARTICIPATION IN PROGRAM. (a) Each |
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individual eligible to participate in the basic coverage may choose |
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instead to participate in the state consumer-directed health plan |
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if the participant is an eligible individual under Section |
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223(c)(1), Internal Revenue Code of 1986. The dependents of a |
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participant may participate in the state consumer-directed health |
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plan in accordance with Section 1551.456. |
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(b) A participant waives basic plan coverage and must be |
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enrolled in a high deductible health plan. |
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(c) Participation in the state consumer-directed health |
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plan qualifies a participant to receive a contribution to a health |
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savings account under Section 1551.458. An individual who elects |
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not to participate in the plan is not eligible to receive a |
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contribution under that section. |
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(d) A participant is subject to Subchapter H in the same |
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manner as an individual who participates in the basic coverage |
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offered under the group benefits program. |
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(e) Under this section, the board of trustees has exclusive |
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authority to determine an individual's eligibility to participate |
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in the state consumer-directed health plan and shall adopt rules |
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regarding eligibility to participate in the plan. |
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Sec. 1551.456. COVERAGE FOR DEPENDENTS; REQUIRED |
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CONTRIBUTIONS. (a) Subject to Subsection (d), a participant is |
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entitled to obtain for the participant's dependents coverage in the |
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state consumer-directed health plan in the manner determined by the |
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board of trustees. |
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(b) The participant shall make any required additional |
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contribution payments for the dependent coverage in the manner |
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prescribed by the board of trustees. |
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(c) Amounts contributed by a participant under this section |
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may be: |
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(1) used to pay the cost of coverage in the state |
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consumer-directed health plan not paid by the state under Section |
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1551.458(b)(1); or |
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(2) contributed as additional amounts to the health |
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savings account provided to the participant. |
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(d) A covered dependent of a participant: |
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(1) is subject to Subchapter H in the same manner as a |
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dependent who is covered by the basic coverage offered under the |
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group benefits program; and |
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(2) must be a dependent for purposes of: |
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(A) Section 152, Internal Revenue Code of 1986; |
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and |
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(B) Section 1551.004. |
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Sec. 1551.457. IDENTIFICATION CARDS FOR PARTICIPANTS. (a) |
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The board of trustees or the account administrator, as applicable, |
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shall issue to each participant an identification card. |
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(b) The board of trustees or the account administrator, as |
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applicable, shall issue a duplicate identification card to each |
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participant's dependent for whom qualified medical expenses may be |
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paid out of a health savings account established under this |
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subchapter. |
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Sec. 1551.458. STATE CONTRIBUTION. (a) For each |
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participant, from the state contribution that would otherwise be |
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made for basic coverage for the participant, the state shall |
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annually contribute: |
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(1) to a high deductible health plan provided under |
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this subchapter, the amount that is necessary to pay the cost of |
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coverage under the high deductible health plan and does not exceed |
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the amount the state annually contributes for a full-time or |
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part-time employee, as applicable, who is covered by the basic |
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coverage; and |
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(2) to the participant's health savings account, any |
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remainder of the state contribution after payment of coverage under |
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Subdivision (1). |
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(b) For each participant's dependent covered under this |
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subchapter from the state contribution that would otherwise be made |
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for basic coverage for the dependent, the state shall annually |
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contribute: |
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(1) to a high deductible health plan provided under |
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this subchapter, the same percentage of the cost of coverage under |
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the high deductible health plan as the state annually contributes |
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for dependent coverage in the basic coverage; and |
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(2) to the participant's health savings account, as |
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allowed under federal law, any remainder of the state contribution |
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after payment for coverage under Subdivision (1). |
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(c) For a calendar year, the amount of state contributions |
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under Subsections (a)(2) and (b)(2), in the aggregate, may not |
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exceed the sum of the monthly limitations imposed by federal law for |
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health savings accounts. |
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Sec. 1551.459. PARTICIPANT CONTRIBUTIONS. (a) Each |
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participant, in accordance with Section 1551.305, shall contribute |
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any amount required to cover the selected participation in the |
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state consumer-directed health plan that exceeds the state |
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contribution amount under Section 1551.458. |
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(b) A participant may contribute any amount allowed under |
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federal law to the participant's health savings account in addition |
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to receiving the state contribution under Section 1551.458. |
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(c) A participant shall make contributions under this |
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section in the manner prescribed by the board of trustees. |
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Sec. 1551.460. COORDINATION WITH CAFETERIA PLAN. (a) The |
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board of trustees has exclusive authority to determine the |
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eligibility of a participant to participate in any medical flexible |
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savings account that is part of a cafeteria plan offered under this |
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chapter. |
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(b) The board of trustees shall adopt rules regarding: |
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(1) the eligibility of a participant to participate in |
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any medical flexible savings account that is part of a cafeteria |
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plan offered under this chapter; and |
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(2) the coordination of benefits provided under this |
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subchapter and any medical flexible savings account that is part of |
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a cafeteria plan offered under this chapter. |
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(c) The rules adopted by the board of trustees under |
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Subsection (b) must prohibit a participant from participating in |
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any medical flexible savings account that would disqualify the |
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participant's health savings account from favorable tax treatment |
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under federal law. |
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Sec. 1551.461. CONFIDENTIALITY OF RECORDS. To the extent |
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allowed under federal law and subject to Section 1551.063, the |
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board of trustees or the account administrator, as applicable, may |
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disclose to a carrier information in an individual's records that |
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the board of trustees or administrator determines is necessary to |
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administer the state consumer-directed health plan. |
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Sec. 1551.462. EXEMPTION FROM EXECUTION; UNASSIGNABILITY. |
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A state contribution to a health savings account or a high |
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deductible health plan is exempt from execution and is unassignable |
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in the same manner and to the same extent as is an amount described |
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by Section 1551.011. |
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Sec. 1551.463. ASSISTANCE. Any state agency that the board |
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of trustees considers appropriate shall assist the board in |
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implementing and administering this subchapter. |
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SECTION 2. The Employees Retirement System of Texas shall |
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develop the state consumer-directed health plan to be implemented |
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under Chapter 1551, Insurance Code, as amended by this Act, |
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including enrollment requirements, during the state fiscal |
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biennium beginning September 1, 2009, with coverage beginning |
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September 1, 2010. |
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SECTION 3. Not later than July 31, 2010, the Employees |
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Retirement System of Texas shall provide written information to |
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individuals eligible to participate in the state consumer-directed |
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health plan under Chapter 1551, Insurance Code, as amended by this |
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Act, that provides a general description of the requirements for |
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the plan as adopted under Chapter 1551, Insurance Code, as amended |
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by this Act. |
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SECTION 4. The Employees Retirement System of Texas shall |
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develop and implement the health savings account program under |
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Chapter 1551, Insurance Code, as amended by this Act, in a manner |
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that is as revenue neutral as is possible. |
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SECTION 5. Except as otherwise provided by this Act, this |
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Act takes effect September 1, 2009. |