HBA-ATS H.B. 3472 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 3472
By: Olivo
Insurance
4/15/1999
Introduced



BACKGROUND AND PURPOSE 

Resurgent economies in the Western Hemisphere have spurred demand for U.S.
goods and services. Among those goods and services most sought after by
foreign nationals are medicine and medical care.  Many of these foreign
nationals include middle- and upper-class Mexican citizens who come to
Texas to obtain medical treatment, even though their health insurance
policies do not generally provide for such coverage.  In addition to those
Mexican nationals who already receive medical treatment in Texas, the
growing number of affluent Mexican citizens along the Texas-Mexico border
represent a significant and untapped market for Texas-based health insurers
and medical care providers.  The possibility of Mexican nationals obtaining
insurance coverage for medical care provided in Texas may result in the
corresponding growth of emerging regional health care centers in regions
such as the Lower Rio Grande Valley and in cities such as Corpus Christi,
El Paso, and Laredo, and of established health care centers in Dallas,
Houston, Lubbock, and San Antonio. 

H.B. 3472 establishes a new chapter in the Insurance Code to authorize a
health benefit plan to provide nonresident coverage for an individual who
purchases the coverage in this state or is eligible for the coverage
because of an employment relationship or other relationship to an
individual or entity in this state, is not a resident of this state or
another state of the U.S., and is not a U.S. citizen. 
Under this bill, the amount of gross premiums collected for nonresident
coverage is prohibited from being included in the computation of the
insurance premium tax.  This prohibition expires December 31, 2005. 

RULEMAKING AUTHORITY
        
It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the commissioner of insurance in
SECTION 1 (Article 21.52I, Insurance Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter E, Chapter 21, Insurance Code, by adding
Article 21.52I, as follows: 

ARTICLE 21.52I. HEALTH BENEFIT PLAN COVERAGE FOR CERTAIN NONRESIDENTS

Sec. 1.  DEFINITION.  Defines "health benefit plan."

Sec. 2.  SCOPE OF ARTICLE.  Specifies that Article 21.52I applies only to a
health benefit plan (plan) that provides benefits for medical or surgical
expenses incurred because of a health condition, accident, or sickness.
These types of plans include an individual, group, blanket, or franchise
insurance policy or insurance agreement, a group hospital service contract,
and individual or group coverage.  Specifies that these plans are offered
by an insurance company; a group hospital service corporation; a fraternal
benefit society; a stipulated premium insurance company; a reciprocal
exchange; a health maintenance organization; a multiple employer welfare
arrangement; and an approved nonprofit health corporation. 

Sec. 3.  COVERAGE FOR CERTAIN NONRESIDENTS.  (a) Authorizes a plan to
provide  nonresident coverage for an individual who purchases the coverage
in this state or is eligible for the coverage because of an employment
relationship or other relationship to an individual or entity in this
state, is not a resident of this state or another state of the U.S., and is
not a U.S. citizen. 

(b) Authorizes the issuance of nonresident coverage to any individual
described by Subsection (a) of this section, including an individual who is
a member of a group who would otherwise be eligible for coverage under a
group plan and would otherwise be eligible for dependent coverage under a
plan. 

Sec. 4.  APPLICATION OF OTHER LAW.  Subjects nonresident coverage to this
code and the other insurance laws of this state.  Provides an exception by
authorizing coverage under the plan, other than coverage for emergency
care, to be limited to benefits for goods and services provided in this
state.  

Sec. 5.  RULES.  Authorizes the commissioner of insurance to adopt rules to
implement this article. 

SECTION 2.  Amends Section 2(c), Article 4.11, Insurance Code, as follows:

(1) Creates this subdivision from existing text.

(2) Makes a conforming change.

(3) Adds this subdivision to prohibit the gross premiums receipts reported
as described by Subdivision (1) of this subsection from including the
amount of premiums that are attributable to nonresident coverage issued
under Article 21.52I of this code.  Establishes December 31, 2005, as the
expiration date of this subdivision. 

SECTION 3.  (a) Effective date: September 1, 1999, except as provided by
Subsection (b). 

(b) Effective date for Section 2 of this Act: January 1, 2000. 

(c) Makes application of this Act prospective for a health benefit plan
that is delivered, issued for delivery, or renewed on or after January 1,
2000. 

(d) Makes application of Section 2 of this Act prospective for a premium
tax imposed under Article 4.11, Insurance Code, beginning January 1, 2000. 

SECTION 4.  Emergency clause.