HBA-TYH C.S.H.B. 1628 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 1628 By: Maxey Insurance 4/26/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE Governmental entities (entities) must make competitive bids for health insurance each year. In order to have a fair and efficient bid process, bidders need claims experience data from the entities. In the past, entities' current insurers have withheld the needed claims experience and consequently have hampered the bidding process. C.S.H.B. 1628 requires insurers to provide the entities with reports that include claims experience for the previous year and the dollar amount of each large claim paid by the insurer in the previous year. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Subchapter E, Chapter 21, Insurance Code, by adding Article 21.49-15, as follows: Art. 21.49-15. INFORMATION REQUIRED TO BE PROVIDED BY INSURER TO GOVERNMENTAL ENTITY WITH WHICH INSURER CONTRACTS Sec. 1. DEFINITIONS. Defines "governmental entity," "insurer," and "political subdivision" for this article. Sec. 2. REQUIRED INFORMATION. (a) Requires each insurer that enters into a contract with a governmental entity (entity) that is subject to competitive bidding requirements to provide to the entity a detailed report that includes: (1) the claims experience of the entity during the preceding calendar year; and (2) the dollar amount of each large claim, as defined by the entity, paid by the insurer under the contract during the preceding calendar year. (b) Provides that claim information provided by an insurer to the entity under this section: is required to be provided in the aggregate, without information through which a specific individual covered by the health insurance or evidence of coverage may be identified; is authorized to be viewed or used only for contract bidding purposes; and is confidential for purposes of Chapter 552 (Public Information), Government Code. SECTION 2.Makes application of this Act prospective. SECTION 3.Effective date: September 1, 1999. SECTION 4.Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The substitute modifies the original bill in SECTION 1 (proposed Section 2, Article 21.49-15, Insurance Code) by changing the section title from "Required Information; Quarterly Report" to "Required Information." The substitute modifies the original bill in SECTION 1 (proposed Section 2, Article 21.49-15(a), Insurance Code) by removing the requirement for the detailed report to be submitted "in the manner prescribed by the governmental entity and on a quarterly basis," as proposed in the original bill. Makes conforming changes. The substitute modifies the original bill in SECTION 1 (proposed Section 2, Article 21.49-15(a)(2), Insurance Code) by requiring the dollar amount, rather than a description, of each large claim to be included in a detailed report to the entity. The substitute modifies the original bill in SECTION 1 (proposed Section 2, Article 21.49-15(b), Insurance Code) to provide that claim information provided by an insurer to the entity under this section is required to be provided in the aggregate, without information through which a specific individual covered by the health insurance or evidence of coverage may be identified, and is authorized to be viewed or used only for contract bidding purposes, in addition to being confidential for purposes of Chapter 552 (Public Information), Government Code, as proposed by the original bill. Makes conforming changes.