Bill Text: TX HB700 | 2023-2024 | 88th Legislature | Introduced
Bill Title: Relating to creation of the Texas Health Insurance Exchange; authorizing an assessment.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2023-03-30 - Left pending in committee [HB700 Detail]
Download: Texas-2023-HB700-Introduced.html
88R3234 MEW-F | ||
By: Oliverson | H.B. No. 700 |
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relating to creation of the Texas Health Insurance Exchange; | ||
authorizing an assessment. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle G, Title 8, Insurance Code, is amended | ||
by adding Chapter 1511 to read as follows: | ||
CHAPTER 1511. TEXAS HEALTH INSURANCE EXCHANGE | ||
SUBCHAPTER A. GENERAL PROVISIONS | ||
Sec. 1511.001. DEFINITIONS. In this chapter: | ||
(1) "Board" means the board of directors of the | ||
exchange. | ||
(2) "Exchange" means the Texas Health Insurance | ||
Exchange. | ||
(3) "Executive commissioner" means the executive | ||
commissioner of the Health and Human Services Commission. | ||
(4) "Qualified health plan" means a health benefit | ||
plan that has been certified by the board as meeting the criteria | ||
established under Section 1311(c), Patient Protection and | ||
Affordable Care Act (42 U.S.C. Section 18031(c)). | ||
(5) "Secretary" means the secretary of the United | ||
States Department of Health and Human Services. | ||
Sec. 1511.002. DEFINITION OF HEALTH BENEFIT PLAN. (a) In | ||
this chapter, "health benefit plan" means an insurance policy, | ||
insurance agreement, evidence of coverage, or other similar | ||
coverage document that provides coverage for medical or surgical | ||
expenses incurred as a result of a health condition, accident, or | ||
sickness that is issued by: | ||
(1) an insurance company; | ||
(2) a group hospital service corporation operating | ||
under Chapter 842; | ||
(3) a health maintenance organization operating under | ||
Chapter 843; | ||
(4) an approved nonprofit health corporation that | ||
holds a certificate of authority under Chapter 844; | ||
(5) a multiple employer welfare arrangement that holds | ||
a certificate of authority under Chapter 846; | ||
(6) a stipulated premium company operating under | ||
Chapter 884; | ||
(7) a fraternal benefit society operating under | ||
Chapter 885; or | ||
(8) an exchange operating under Chapter 942. | ||
(b) In this chapter, "health benefit plan" does not include: | ||
(1) a plan that provides coverage: | ||
(A) for wages or payments in lieu of wages for a | ||
period during which an employee is absent from work because of | ||
sickness or injury; | ||
(B) as a supplement to a liability insurance | ||
policy; | ||
(C) for credit insurance; | ||
(D) only for vision care; | ||
(E) only for hospital expenses; or | ||
(F) only for indemnity for hospital confinement; | ||
(2) a Medicare supplemental policy as defined by | ||
Section 1882(g)(1), Social Security Act (42 U.S.C. Section | ||
1395ss(g)(1)); | ||
(3) a workers' compensation insurance policy; or | ||
(4) medical payment insurance coverage provided under | ||
a motor vehicle insurance policy. | ||
Sec. 1511.003. TREATMENT OF EMPLOYERS. (a) For purposes of | ||
this chapter, "small employer" means a person who employed at least | ||
two, and an average of not more than 50 employees during the | ||
preceding calendar year. This subsection expires December 31, | ||
2025. | ||
(b) All persons treated as a single employer under Section | ||
414(b), (c), (m), or (o), Internal Revenue Code of 1986, are single | ||
employers for purposes of this chapter. | ||
(c) An employer and any predecessor employer are a single | ||
employer for purposes of this chapter. | ||
(d) In determining the number of employees of an employer | ||
under this section, the number of employees: | ||
(1) includes part-time employees and employees who are | ||
not eligible for coverage through the employer; and | ||
(2) for an employer that did not have employees during | ||
the entire preceding calendar year, is the average number of | ||
employees that the employer is reasonably expected to employ on | ||
business days in the current calendar year. | ||
(e) A small employer that makes enrollment in qualified | ||
health plans available to its employees through the exchange and | ||
ceases to be a small employer by reason of an increase in the number | ||
of its employees continues to be a small employer for purposes of | ||
this chapter as long as it continuously makes enrollment through | ||
the exchange available to its employees. | ||
Sec. 1511.004. RULEMAKING AUTHORITY. The board may adopt | ||
rules necessary and proper to implement this chapter. Rules adopted | ||
under this section may not conflict with or prevent the application | ||
of regulations promulgated by the secretary under the Patient | ||
Protection and Affordable Care Act (Pub. L. No. 111-148). | ||
Sec. 1511.005. AGENCY COOPERATION. (a) The exchange, the | ||
department, and the Health and Human Services Commission shall | ||
cooperate fully in performing their respective duties under this | ||
code or another law of this state relating to the operation of the | ||
exchange. | ||
(b) The exchange shall cooperate and coordinate with the | ||
Health and Human Services Commission to facilitate a seamless user | ||
experience. | ||
Sec. 1511.006. EXEMPTION FROM STATE TAXES AND FEES. The | ||
exchange is not subject to any state tax, regulatory fee, or | ||
surcharge, including a premium or maintenance tax or fee. | ||
Sec. 1511.007. COMPLIANCE WITH FEDERAL LAW. The exchange | ||
shall comply with all applicable federal law and regulations. | ||
Sec. 1511.008. EXEMPTION FROM STATE PURCHASING PROCEDURES. | ||
The exchange is not subject to state purchasing or procurement | ||
requirements under Subtitle D, Title 10, Government Code, or any | ||
other law. | ||
SUBCHAPTER B. ESTABLISHMENT AND GOVERNANCE | ||
Sec. 1511.051. ESTABLISHMENT. The Texas Health Insurance | ||
Exchange is established as an American Health Benefit Exchange and | ||
a Small Business Health Options Program (SHOP) Exchange authorized | ||
and required by Section 1311, Patient Protection and Affordable | ||
Care Act (42 U.S.C. Section 18031). | ||
Sec. 1511.052. GOVERNANCE OF EXCHANGE; BOARD MEMBERSHIP. | ||
(a) The exchange is governed by a board of directors. | ||
(b) The board consists of 11 members as follows: | ||
(1) five members appointed by the governor, two of | ||
whom have experience in the health insurance industry; | ||
(2) three additional members appointed by the governor | ||
from a list of nominees submitted by the speaker of the house of | ||
representatives; and | ||
(3) three members appointed by the lieutenant | ||
governor. | ||
(c) In making appointments or nominations under this | ||
section, the governor, lieutenant governor, and speaker of the | ||
house of representatives shall attempt to make appointments and | ||
nominations that increase the board's diversity of expertise. | ||
Sec. 1511.053. PRESIDING OFFICER. The board shall annually | ||
designate one member of the board to serve as presiding officer. | ||
Sec. 1511.054. TERMS; VACANCY. (a) Appointed members of | ||
the board serve two-year terms, with the members' terms expiring | ||
February 1 of each odd-numbered year. | ||
(b) The appropriate appointing authority shall fill a | ||
vacancy on the board by appointing, for the unexpired term, an | ||
individual who has the appropriate qualifications to fill that | ||
position. | ||
Sec. 1511.055. CONFLICT OF INTEREST. (a) Any board member | ||
or a member of a committee formed by the board with a direct | ||
interest in a matter, personally or through an employer, before the | ||
board shall abstain from deliberations and actions on the matter in | ||
which the conflict of interest arises and shall further abstain | ||
from any vote on the matter, and may not otherwise participate in a | ||
decision on the matter. | ||
(b) Each board member shall file a conflict of interest | ||
statement and a statement of ownership interests with the board to | ||
ensure disclosure of all existing and potential personal interests | ||
related to board business. | ||
(c) A member of the board or of the staff of the exchange may | ||
not be employed by, affiliated with, a consultant to, a member of | ||
the board of directors of, or otherwise a representative of a health | ||
benefit plan issuer or other insurer, an agent or broker, a health | ||
care provider, or a health care facility or health clinic while | ||
serving on the board or on the staff of the exchange. | ||
(d) A member of the board or of the staff of the exchange may | ||
not be a member, a board member, or an employee of a trade | ||
association of health benefit plan issuers, health facilities, | ||
health clinics, or health care providers while serving on the board | ||
or on the staff of the exchange. | ||
(e) A member of the board or of the staff of the exchange may | ||
not be a health care provider unless the member receives no | ||
compensation for rendering services as a health care provider and | ||
does not have an ownership interest in a professional health care | ||
practice. | ||
Sec. 1511.056. GENERAL DUTIES OF BOARD MEMBERS. (a) Each | ||
board member has the responsibility and duty to meet the | ||
requirements of this title and applicable state and federal laws | ||
and regulations, to serve the public interest of the individuals | ||
and small businesses seeking health benefit plan coverage through | ||
the exchange, and to ensure the operational well-being and fiscal | ||
solvency of the exchange. | ||
(b) A member of the board may not make, participate in | ||
making, or in any way attempt to use the board member's official | ||
position to influence the making of any decision that the board | ||
member knows or has reason to know will have a material financial | ||
effect, distinguishable from its effect on the public generally, on | ||
the board member or the board member's immediate family, or on: | ||
(1) any source of income, other than gifts and loans by | ||
a commercial lending institution in the regular course of business | ||
on terms available to the public generally, aggregating $250 or | ||
more in value, provided or promised to the member within the 12 | ||
months immediately preceding the date the decision is made; or | ||
(2) any business entity in which the member is a | ||
director, officer, partner, trustee, or employee, or holds any | ||
position of management. | ||
Sec. 1511.057. REIMBURSEMENT. A member of the board is not | ||
entitled to compensation but is entitled to reimbursement for | ||
travel or other expenses incurred while performing duties as a | ||
board member in the amount provided by the General Appropriations | ||
Act for state officials. | ||
Sec. 1511.058. MEMBER'S IMMUNITY. (a) A member of the | ||
board is not liable for an act or omission made in good faith in the | ||
performance of powers and duties under this chapter. | ||
(b) A cause of action does not arise against a member of the | ||
board for an act or omission described by Subsection (a). | ||
Sec. 1511.059. OPEN RECORDS AND OPEN MEETINGS. The board is | ||
subject to Chapters 551 and 552, Government Code. | ||
Sec. 1511.060. RECORDS. The board shall keep records of the | ||
board's proceedings for at least seven years. | ||
SUBCHAPTER C. POWERS AND DUTIES OF EXCHANGE | ||
Sec. 1511.101. EMPLOYEES; COMMITTEES. (a) The board may | ||
employ an executive director and any other agents and employees | ||
that the board considers necessary to assist the exchange in | ||
carrying out its responsibilities and functions. | ||
(b) The executive director shall organize, administer, and | ||
manage the operations of the exchange. The executive director may | ||
hire other employees as necessary to carry out the responsibilities | ||
of the exchange. | ||
(c) The exchange may appoint appropriate legal, actuarial, | ||
and other committees necessary to provide technical assistance in | ||
operating the exchange and performing any of the functions of the | ||
exchange. | ||
Sec. 1511.102. ADVISORY COMMITTEE. The board may appoint | ||
an advisory committee to allow for the involvement of the health | ||
care and health insurance industries and other stakeholders in the | ||
operation of the exchange. The advisory committee may provide | ||
expertise and recommendations to the board but may not adopt rules | ||
or enter into contracts on behalf of the exchange. | ||
Sec. 1511.103. CONTRACTS. (a) Except as provided by | ||
Subsection (b), the exchange may enter into any contract that the | ||
exchange considers necessary to implement or administer this | ||
chapter, including a contract with the department, the Health and | ||
Human Services Commission, or an entity that has experience in | ||
individual and small group health insurance, benefit | ||
administration, or other experience relevant to the | ||
responsibilities assumed by the entity, to perform functions or | ||
provide services in connection with the operation of the exchange. | ||
(b) This exchange may not enter into a contract with a | ||
health benefit plan issuer under this section. | ||
Sec. 1511.104. INFORMATION SHARING AND CONFIDENTIALITY. | ||
The exchange may enter into information-sharing agreements with | ||
federal and state agencies to carry out the exchange's | ||
responsibilities under this chapter. An agreement entered into | ||
under this section must include adequate protection with respect to | ||
the confidentiality of any information shared and comply with all | ||
applicable state and federal law. | ||
Sec. 1511.105. MEMORANDUM OF UNDERSTANDING. The exchange | ||
shall enter into a memorandum of understanding with the department | ||
and the Health and Human Services Commission regarding the exchange | ||
of information and the division of regulatory functions among the | ||
exchange, the department, and the commission. | ||
Sec. 1511.106. LEGAL ACTION. (a) The exchange may sue or | ||
be sued. | ||
(b) The exchange may take any legal action necessary to | ||
recover or collect amounts due the exchange, including: | ||
(1) assessments due the exchange; | ||
(2) amounts erroneously or improperly paid by the | ||
exchange; and | ||
(3) amounts paid by the exchange as a mistake of fact | ||
or law. | ||
Sec. 1511.107. FUNCTIONS. The exchange shall perform all | ||
functions and duties related to state-based exchanges required by | ||
applicable state and federal law. | ||
Sec. 1511.108. HEALTH CARE PROVIDER DIRECTORY AND | ||
INFORMATION. (a) The exchange may provide an integrated and | ||
uniform consumer directory of health care providers indicating | ||
which health benefit plan issuers the providers contract with and | ||
whether the providers are currently accepting new patients. | ||
(b) The exchange may establish methods by which health care | ||
providers may transmit relevant information directly to the | ||
exchange, rather than through an issuer. | ||
Sec. 1511.109. STATE-ADMINISTERED SUBSIDY PROGRAM. (a) Not | ||
later than July 1, 2024, the exchange, in coordination with the | ||
department, shall review and make recommendations to the Senate | ||
Business and Commerce Committee and the House of Representatives | ||
Insurance Committee regarding the feasibility of implementing a | ||
state-administered subsidy program for individuals, families, and | ||
small employers to purchase health benefit plan coverage. | ||
(b) With the input and approval of the Senate Business and | ||
Commerce Committee and the House of Representatives Insurance | ||
Committee, the exchange may develop and implement a | ||
state-administered subsidy program. | ||
Sec. 1511.110. FEDERAL WAIVERS. (a) Not later than July 1, | ||
2024, the exchange, in coordination with the department, shall | ||
review and make recommendations to the Senate Business and Commerce | ||
Committee and the House of Representatives Insurance Committee | ||
regarding the submission of a state innovation waiver that may be | ||
granted under Section 1332, Patient Protection and Affordable Care | ||
Act (42 U.S.C. Section 18052), with respect to health benefit plan | ||
coverage or health insurance products in this state, including | ||
recommendations on: | ||
(1) risk stabilization strategies aimed at addressing | ||
risk associated with individuals with high health care costs; | ||
(2) individual coverage health reimbursement | ||
arrangements for employees of large and small businesses in this | ||
state; | ||
(3) financial assistance for different types of health | ||
benefit plan coverage, including non-qualified health plans for | ||
individuals purchasing coverage; and | ||
(4) the establishment of account-based premium | ||
credits for individuals and families enrolled in coverage through | ||
the exchange. | ||
(b) With the input and approval of the Senate Business and | ||
Commerce Committee and the House of Representatives Insurance | ||
Committee, the exchange may submit one or more applications to the | ||
secretary to obtain a waiver of any applicable provisions of the | ||
Patient Protection and Affordable Care Act (Pub. L. No. 111-148). | ||
(c) On approval by the secretary of a waiver under | ||
Subsection (b), the exchange may implement the approved waiver. | ||
SUBCHAPTER D. ASSESSMENTS FOR OPERATION OF EXCHANGE | ||
Sec. 1511.151. ASSESSMENTS. (a) The exchange may charge | ||
the issuers of health benefit plans in this state, including | ||
qualified health plans, an assessment as reasonable and necessary | ||
to cover the exchange's organizational and operating expenses and | ||
expenses related to health coverage programs associated with the | ||
exchange. Assessments must be determined annually. The exchange | ||
may charge interest for late assessments. | ||
(b) The commissioner shall adopt rules to implement and | ||
enforce the assessment of health benefit plan issuers under this | ||
section. | ||
Sec. 1511.152. GRANTS AND FEDERAL FUNDS. (a) The exchange | ||
may accept a grant from a public or private organization and may | ||
spend those funds to pay the costs of program administration and | ||
operations. | ||
(b) The exchange may accept federal funds and shall use | ||
those funds in compliance with applicable federal law, regulations, | ||
and guidelines. | ||
Sec. 1511.153. USE OF EXCHANGE ASSETS; ANNUAL REPORT. (a) | ||
The assets of the exchange may be used only to pay the costs: | ||
(1) of the administration and operation of the | ||
exchange; and | ||
(2) associated with any health coverage programs | ||
associated with the exchange. | ||
(b) The exchange shall prepare annually a complete and | ||
detailed written report accounting for all funds received and | ||
disbursed by the exchange during the preceding fiscal year. The | ||
report must meet any reporting requirements provided in the General | ||
Appropriations Act, regardless of whether the exchange receives any | ||
funds under that Act. The exchange shall submit the report to the | ||
governor, the legislature, the commissioner, and the executive | ||
commissioner not later than January 31 of each year. | ||
(c) General revenue may not be appropriated for the | ||
exchange. | ||
Sec. 1511.154. PUBLICATION OF FINANCIAL INFORMATION. The | ||
exchange shall publish the average costs of licensing, regulatory | ||
fees, and any other payments required by the exchange, and the | ||
administrative costs of the exchange, on an Internet website to | ||
educate consumers on those costs. This information must include | ||
information on losses due to waste, fraud, and abuse. | ||
SUBCHAPTER E. TRUST FUND | ||
Sec. 1511.201. TRUST FUND. (a) The exchange fund is | ||
established as a special trust fund outside of the state treasury in | ||
the custody of the comptroller separate and apart from all public | ||
money or funds of this state. | ||
(b) The exchange may deposit assessments, gifts or | ||
donations, and any federal funding obtained by the exchange in the | ||
exchange fund in accordance with procedures established by the | ||
comptroller. | ||
(c) Interest or other income from the investment of the fund | ||
shall be deposited to the credit of the fund. | ||
SECTION 2. Effective January 1, 2026, Section 1511.003, | ||
Insurance Code, as added by this Act, is amended by adding | ||
Subsection (a-1) to read as follows: | ||
(a-1) For purposes of this chapter, "small employer" means a | ||
person who employed an average of not more than 100 employees during | ||
the preceding calendar year. | ||
SECTION 3. (a) As soon as practicable after the effective | ||
date of this Act, but not later than October 31, 2023, the governor | ||
and lieutenant governor shall appoint the initial members of the | ||
board of directors of the Texas Health Insurance Exchange. | ||
(b) As soon as practicable after the appointments required | ||
by Subsection (a) of this section are made, but not later than | ||
November 30, 2023, the board of directors of the Texas Health | ||
Insurance Exchange shall hold a special meeting to discuss the | ||
adoption of rules and procedures necessary to implement Chapter | ||
1511, Insurance Code, as added by this Act. | ||
(c) As soon as practicable after the effective date of this | ||
Act, but not later than January 31, 2024, the board of directors of | ||
the Texas Health Insurance Exchange shall adopt rules and | ||
procedures necessary to implement Chapter 1511, Insurance Code, as | ||
added by this Act. | ||
(d) If, after the effective date of this Act but before the | ||
initial members of the board of directors of the Texas Health | ||
Insurance Exchange have been appointed as required by Subsection | ||
(a) of this section, the Texas Department of Insurance becomes | ||
aware of any planning and establishment grants as described by | ||
Section 1311, Patient Protection and Affordable Care Act (42 U.S.C. | ||
Section 18031), or any other public or private funding source, the | ||
department may apply for funding from that source. | ||
(e) The exchange may not begin operations without adequate | ||
funding. | ||
(f) The board of directors of the Texas Health Insurance | ||
Exchange may adopt rules on an emergency basis in accordance with | ||
Section 2001.034, Government Code. Notwithstanding Section | ||
2001.034(c), Government Code, a rule adopted under this subsection | ||
may remain in effect until January 1, 2027. Rules adopted under | ||
this subsection shall be deemed necessary for the immediate | ||
preservation of the public peace, health, safety, and general | ||
welfare and an additional finding under Sections 2001.034(a)(1) and | ||
(2), Government Code, is not required. The authority to adopt rules | ||
under this subsection expires January 1, 2027. | ||
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, 2023. |