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A BILL TO BE ENTITLED
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AN ACT
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relating to participation by single-employee businesses in private |
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purchasing cooperatives or health group cooperatives. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1501.051, Insurance Code, is amended by |
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adding Subdivision (3-b) to read as follows: |
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(3-b) "Eligible single-employee business" means a |
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business entity that: |
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(A) is owned and operated by a sole proprietor; |
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(B) employs an average of fewer than two |
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employees on business days during the preceding calendar year; and |
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(C) is eligible to participate in a cooperative |
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under this subchapter in accordance with Section 1501.066. |
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SECTION 2. Section 1501.0581, Insurance Code, is amended by |
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amending Subsections (a), (b), and (p) and adding Subsection (o-1) |
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to read as follows: |
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(a) The membership of a health group cooperative may consist |
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of only small employers, only large employers, or only eligible |
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single-employee businesses, but may not consist of a combination of |
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those types of entities [or both small and large employers]. To |
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participate as a member of a health group cooperative, an employer |
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must be a small or large employer as described by this chapter or an |
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eligible single-employee business as described by Section |
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1501.051(3-b). |
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(b) Subject to the requirements imposed on small employer |
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health benefit plan issuers under Section 1501.101 and subject to |
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Subsections (a-1) and (o), a health group cooperative: |
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(1) shall allow a small employer to join a health group |
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cooperative consisting of only small employers or both small and |
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large employers and enroll in health benefit plan coverage; [and] |
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(2) may allow an eligible single-employee business to |
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join a health group cooperative consisting of only eligible |
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single-employee businesses and enroll in health benefit plan |
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coverage; and |
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(3) may allow a large employer to join the health group |
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cooperative and enroll in health benefit plan coverage. |
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(o-1) A health group cooperative consisting only of |
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eligible single-employee businesses may elect to restrict |
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membership in the cooperative so that the total number of eligible |
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employees employed on business days during the preceding calendar |
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year by all eligible single-employee businesses participating in |
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the cooperative does not exceed 50. |
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(p) A health group cooperative must make the election |
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described by Subsection (o) or (o-1) at the time the cooperative is |
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initially formed. Evidence of the election must be filed in writing |
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with the commissioner in the form and at the time prescribed by the |
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commissioner by rule. |
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SECTION 3. Sections 1501.063(b-1) and (b-2), Insurance |
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Code, are amended to read as follows: |
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(b-1) Subject to Section 1501.066, a [A] health group |
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cooperative that is composed only of small employers or only of |
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eligible single-employee businesses and that has made the election |
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described by Section 1501.0581(o)(1) or (o-1), as applicable, in |
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accordance with Subsection (p) of that section shall be treated in |
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the same manner as a small employer for the purposes of this |
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chapter, including for the purposes of any provision relating to |
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premium rates and issuance and renewal of coverage. |
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(b-2) A health group cooperative that is composed only of |
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small employers or only of eligible single-employee businesses and |
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that has not made the election described by Section 1501.0581(o)(1) |
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or (o-1), as applicable, in accordance with Subsection (p) of that |
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section, or a health group cooperative that is composed of both |
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small and large employers, may be treated in the same manner as a |
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large employer for the purposes of this chapter, including for the |
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purposes of any provision relating to premium rates and issuance |
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and renewal of coverage. |
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SECTION 4. Subchapter B, Chapter 1501, Insurance Code, is |
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amended by adding Sections 1501.066 and 1501.067 to read as |
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follows: |
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Sec. 1501.066. ELIGIBLE SINGLE-EMPLOYEE BUSINESS. (a) The |
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commissioner by rule shall adopt rules governing the eligibility of |
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a single-employee business to participate in a health group |
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cooperative under this subchapter. The rules must include |
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provisions to ensure that each eligible single-employee business |
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has a business purpose and was not formed solely to obtain health |
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benefit plan coverage under this subchapter. |
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(b) The commissioner may specify additional requirements |
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for a health group cooperative composed solely of eligible |
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single-employee businesses to qualify for coverage as a small |
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employer under this chapter or, if the commissioner finds that |
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treatment of such a cooperative as a small employer is not |
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actuarially justified, may require that a health group cooperative |
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composed solely of eligible single-employee businesses be treated |
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as a large employer under this chapter. |
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Sec. 1501.067. COOPERATIVES FOR SMALL EMPLOYERS, LARGE |
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EMPLOYERS, AND SINGLE-EMPLOYEE BUSINESSES. The department may |
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develop a program to assist small employers, large employers, and |
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single-employee businesses to form or participate in private |
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purchasing cooperatives and health group cooperatives in |
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accordance with this subchapter. |
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SECTION 5. The commissioner of insurance shall adopt any |
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rules necessary to implement the change in law made by this Act not |
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later than December 1, 2009. A person may not form a health group |
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cooperative composed solely of eligible single-employee businesses |
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under Subchapter B, Chapter 1501, Insurance Code, as amended by |
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this Act, before January 1, 2010. |
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SECTION 6. This Act takes effect September 1, 2009. |