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A BILL TO BE ENTITLED
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AN ACT
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relating to premium discounts for certain participants in the Texas |
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Health Insurance Risk Pool and to related tax credits for health |
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benefit plan issuers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1506.105, Insurance Code, is amended by |
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amending Subsection (e) and adding Subsections (e-1) and (e-2) to |
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read as follows: |
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(e) Premium rates shall be established to provide fully for |
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all of the expected costs of claims, including recovery of prior |
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losses, expenses of operation, investment income from claim |
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reserves, and any other cost factors, subject to the limitations |
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[limitation] described in this subsection and Subsection (e-1). In |
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no event may pool premium rates exceed 200 percent of the standard |
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risk rate described by Subsection (d) [rates applicable to
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individual standard risks]. |
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(e-1) Subject to Subsection (e-2), discounted premiums |
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shall be offered on a sliding scale, based on financial need, as |
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follows: |
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(1) for an individual whose household income is below |
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200 percent of the federal poverty measure, determined under the |
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United States Department of Health and Human Services poverty |
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guidelines in effect at the time coverage is provided, premium |
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rates shall equal the standard risk rate described by Subsection |
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(d); and |
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(2) for an individual whose household income is at or |
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below 300 percent, but not less than 200 percent, of the federal |
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poverty measure, determined under the United States Department of |
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Health and Human Services poverty guidelines in effect at the time |
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coverage is provided, premium rates shall equal 140 percent of the |
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standard risk rate described by Subsection (d). |
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(e-2) The aggregate premium discount under Subsection |
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(e-1), determined by subtracting the dollar amount of premiums |
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collected under Subsection (e-1) from the dollar amount that would |
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have been collected if a discount was not available under |
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Subsection (e-1), may not exceed $20 million for the two-year |
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period beginning January 1, 2010, and ending December 31, 2011. |
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SECTION 2. Subchapter F, Chapter 1506, Insurance Code, is |
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amended by adding Section 1506.260 to read as follows: |
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Sec. 1506.260. TAX CREDIT. (a) A health benefit plan |
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issuer is entitled to a credit against the issuer's premium tax |
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under Chapter 222 for premium discounts granted under Section |
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1506.105(e-1). Each issuer's share of the premium discounts is |
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based on the method described by Section 1506.253 as calculated by |
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the pool. |
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(b) The tax credit applies to the premium tax due in the |
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calendar year following the calendar year in which the assessment |
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is paid. An unused credit may be carried over to apply to the |
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premium tax due in the five consecutive calendar years that follow |
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the calendar year in which the credit may first be applied. |
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(c) The balance of a tax credit not claimed in a particular |
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calendar year may be reflected in the books and records of the |
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issuer as an admitted asset of the issuer. |
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(d) Available credit against premium tax allowed under this |
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section may be transferred or assigned among health benefit plan |
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issuers if: |
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(1) a merger, acquisition, or total assumption of |
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reinsurance among the issuers occurs; or |
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(2) the commissioner by order approves the transfer or |
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assignment. |
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SECTION 3. (a) This Act applies only to premium rates for |
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coverage through the Texas Health Insurance Risk Pool under Chapter |
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1506, Insurance Code, as amended by this Act, that is in effect on |
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or after January 1, 2010. Premium rates for coverage in effect |
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before January 1, 2010, are governed by the law in effect |
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immediately before the effective date of this Act, and the former |
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law is continued in effect for that purpose. |
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(b) A health benefit plan issuer may apply a tax credit |
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under Section 1506.260, Insurance Code, as added by this Act, |
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beginning with the first premium tax payment that is due on or after |
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January 1, 2012. |
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SECTION 4. This Act takes effect September 1, 2009. |