HBA-TBM H.B. 1866 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 1866
By: Averitt
Insurance
3/23/2001
Introduced



BACKGROUND AND PURPOSE 

In 1993, the legislature passed a bill that created the Small Employer
Health Insurance Availability Act with the intention of providing health
insurance for small employers of Texas.  Small employer purchasing
cooperatives were to be given the power to purchase coverage for groups of
small businesses.  By banding together to purchase coverage, it was
envisioned that small employers would be able to achieve the economies of
scale similar to those enjoyed by large employers.  Not all small employers
may be accomplishing these goals due to ambiguous language in the current
law.  House Bill 1866 modifies provisions concerning insurance coverage for
purchasing cooperatives.   

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. 

ANALYSIS

House Bill 1866 amends the Insurance Code to authorize the Texas Health
Benefits Purchasing Cooperative (Texas Cooperative) and private purchasing
cooperatives to offer such other ancillary products and services to its
members as are customarily offered to small or large employers.  The bill
authorizes the Texas Cooperative to contract only with small or large
employer carriers who desire to offer coverage through the cooperative and
fulfill certain qualifications.  The bill authorizes a class of membership
of a private purchasing cooperative to contract for the small or large
employer health benefit plans with small or large employer health benefit
plans with small or large employer carriers who fulfill certain
qualifications.   

The bill authorizes a private purchasing cooperative to establish separate,
distinct, and unaffiliated classes of membership.  The bill provides that
the Texas Cooperative is considered an employer solely for the purposes of
benefit elections.  A class of membership of a cooperative is considered a
single small or large employer solely for the purposes of benefit
elections.   

EFFECTIVE DATE

September 1, 2001.  This Act applies only to a health benefit plan that is
delivered, issued for delivery, or renewed on or after January 1, 2002.