89R21810 SCR-F

By: Dean, Harless, Hull, Gerdes, Tepper, H.B. No. 139

et al.

Substitute the following for H.B. No. 139:

By: Dean C.S.H.B. No. 139

A BILL TO BE ENTITLED

AN ACT

relating to employer health benefit plans that do not include state-mandated health benefits.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 1251.202, Insurance Code, is amended to read as follows:

Sec. 1251.202. NOTICE REGARDING CERTAIN EMPLOYER HEALTH BENEFIT PLANS. (a) In this section:

(1) "Employer choice of benefits plan" means a plan offered under Chapter 1506.

(2) [,] "Standard [standard] health benefit plan" means a plan offered under Chapter 1507.

(b) If an employer offers to employees an employer choice of benefits plan or a standard health benefit plan, the employer shall:

(1) provide a copy of the disclosure statement provided to the employer by the plan issuer under Section 1506.102, 1507.006, or 1507.056, as applicable, to:

(A) each employee:

(i) before the employee initially enrolls in the plan, unless the employee received notice under Paragraph (B) on or after the 90th day before the date the employee initially enrolls; and

(ii) not later than the 30th day before the date the employee renews enrollment in the plan; and

(B) each prospective employee before the prospective employee is hired by the employer; and

(2) obtain a copy of the notice signed by the employee or prospective employee at the time the notice is provided.

SECTION 2. Section 1275.002, Insurance Code, is amended to read as follows:

Sec. 1275.002. APPLICABILITY OF CHAPTER. This chapter applies only to:

(1) a health benefit plan offered by a nonprofit agricultural organization under Chapter 1682; [and]

(2) a health benefit plan:

(A) that is a self-insured or self-funded plan established by an employer for the benefit of the employer's employees in accordance with the Employee Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.); and

(B) for which the plan sponsor has made an election, submitted to the commissioner in the form and manner prescribed by the commissioner, to apply this chapter to the plan for the relevant plan year; and

(3) an employer choice of benefits plan offered under Chapter 1506.

SECTION 3. Section 1501.002(15), Insurance Code, is amended to read as follows:

(15) "Small employer health benefit plan" means a health benefit plan developed by the commissioner under Subchapter F [or any other health benefit plan offered to a small employer in accordance with Section 1501.252(c) or 1501.255].

SECTION 4. Section 1501.213(b), Insurance Code, is amended to read as follows:

(b) A health maintenance organization that participates in a purchasing cooperative that provides employees of small employers a choice of health benefit plans may use rating methods in accordance with this subchapter that are used by other small employer health benefit plan issuers participating in the same cooperative, including rating by age and gender, if the health maintenance organization has established[:

[(1)] a separate class of business, as provided by Section 1501.202[; and

[(2) a separate line of business, as provided under Section 1501.255(b)].

SECTION 5. Subtitle G, Title 8, Insurance Code, is amended by adding Chapter 1506 to read as follows:

CHAPTER 1506. EMPLOYER CHOICE OF BENEFITS PLANS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 1506.001. DEFINITIONS. In this chapter:

(1) "Employer choice of benefits plan" means a group health benefit plan offered to an employer that, wholly or partly, does not offer or provide state-mandated health benefits, but that provides creditable coverage as defined by Section 1205.004(a) or 1501.102(a).

(2) "Health benefit plan issuer" means any entity authorized under this code or another insurance law of this state to provide health insurance or health benefits in this state. The term includes an insurance company and a health maintenance organization operating under Chapter 843.

(3) "State-mandated health benefits" means coverage or another feature required under this code or other laws of this state to be provided in a group health benefit plan that:

(A) includes coverage for specific health care services or benefits;

(B) places limitations or restrictions on deductibles, coinsurance, copayments, or any annual or lifetime maximum benefit amounts, including limitations provided by commissioner rule;

(C) includes a specific category of licensed health care practitioner from whom an enrollee is entitled to receive care;

(D) requires standard provisions or rights that are unrelated to a specific health illness, injury, or condition of an enrollee;

(E) requires the health benefit plan to provide coverage for health care services or benefits in excess of federal requirements; or

(F) is a requirement for which an exemption is provided under Section 1506.105.

Sec. 1506.002. RULES. The commissioner shall adopt rules necessary to implement this chapter.

SUBCHAPTER B. EMPLOYER CHOICE OF BENEFITS PLANS

Sec. 1506.101. PLANS AUTHORIZED. (a) A health benefit plan issuer may offer one or more employer choice of benefits plans.

(b) An employer choice of benefits plan must include coverage for an essential health benefits package as determined by the commissioner based on 42 U.S.C. Section 18022, including:

(1) ambulatory patient services;

(2) emergency services;

(3) hospitalization;

(4) maternity and newborn care;

(5) mental health and substance use disorder services, including behavioral health treatment;

(6) prescription drugs;

(7) rehabilitative and habilitative services and devices;

(8) laboratory services;

(9) preventative and wellness services and chronic disease management; and

(10) pediatric services, including oral and vision care.

(c) An employer choice of benefits plan may not include a preexisting condition exclusion.

Sec. 1506.102. NOTICE TO ENROLLEES. (a) Each written application to enroll in an employer choice of benefits plan must contain the following language at the beginning of the document in bold type:

"You have the option to enroll in this Employer Choice of Benefits Plan that does not provide all coverage or features normally required in health benefit plans in Texas. This employer health benefit plan may provide a more affordable health benefit plan for you, although, at the same time, it may provide you with fewer health benefits or other features than those normally included in health benefit plans in Texas. If you choose this employer health benefit plan, please consult with your plan issuer to discover which state-mandated health benefits or other features are excluded from this health benefit plan."

(b) Each employer choice of benefits plan must contain the following language at the beginning of the document in bold type:

"This Employer Choice of Benefits Plan does not provide all coverage or features normally required in health benefit plans in Texas. This employer health benefit plan may provide a more affordable health benefit plan for you, although, at the same time, it may provide you with fewer health benefits or other features than those normally included in health benefit plans in Texas. Please consult with your employer representative to discover which state-mandated health benefits or other features are excluded from this health benefit plan."

Sec. 1506.103. DISCLOSURE STATEMENT. (a) Before a health benefit plan issuer may contract to provide an employer choice of benefits plan to an employer, the issuer must provide the employer with a written disclosure statement that:

(1) acknowledges that the employer health benefit plan being contracted for does not provide some or all state-mandated health benefits; and

(2) lists those state-mandated health benefits not included in the plan.

(b) An employer entering into a contract for an employer choice of benefits plan must sign the disclosure statement provided by the health benefit plan issuer under Subsection (a) and return the statement to the issuer.

(c) A health benefit plan issuer shall:

(1) retain the signed disclosure statement in the health benefit plan issuer's records; and

(2) on request from the commissioner, provide the signed disclosure statement to the department.

Sec. 1506.104. ADDITIONAL HEALTH BENEFIT PLANS. A health benefit plan issuer that offers one or more employer choice of benefits plans must also offer employers at least one group health benefit plan that provides state-mandated health benefits and is otherwise authorized by this code.

Sec. 1506.105. COVERAGE EXEMPT FROM INSURANCE LAW. (a) Except as provided by Subsection (b), an employer choice of benefits plan provided under this chapter is exempt from any other insurance law that does not expressly apply to the plan or this chapter.

(b) An employer choice of benefits plan is not exempt from the requirements imposed by the following:

(1) Titles 2, 3, 4, 5, 6, 9, and 13, as applicable, except that an employer choice of benefits plan offered by a health maintenance organization is exempt from requirements imposed by Chapter 843 to the extent that those requirements conflict with this chapter;

(2) Subchapters B, C, and F, Chapter 1271; and

(3) Sections 843.209, 1301.1581, 1301.162, and 1369.153.

SECTION 6. The following provisions of the Insurance Code are repealed:

(1) Section 1501.213(a);

(2) Section 1501.252;

(3) Section 1501.254;

(4) Section 1501.255; and

(5) Section 1501.259.

SECTION 7. 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, 2025.