HBA-MPM H.B. 2285 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2285 By: Kitchen Public Health 3/27/2001 Introduced BACKGROUND AND PURPOSE The Texas Healthy Kids Corporation (THK) is currently in the process of dissolution. While most children covered under THK's program are eligible for the state child health plan (CHIP), some children will not be eligible for coverage under CHIP. The family incomes of these children range from at or below 200 to 300 percent of the federal poverty level. To ensure that all children from low-income families have health benefits coverage, a buy-in program for families of children not otherwise eligible for CHIP is needed. House Bill 2285 establishes two eligibility groups for CHIP coverage, one fully-covered eligibility group for a child whose family income is at or below 200 percent of the federal poverty level, and another costsharing eligibility group for a child whose family income is at or below 300 percent of the poverty level. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Health and Human Services Commission in SECTION 1.02 (Section 62.1015, Health and Safety Code) and SECTION 1.05 (Section 62.203, Health and Safety Code) of this bill. ANALYSIS House Bill 2285 amends the Health and Safety Code to establish two eligibility groups, group A and group B, for children who are eligible for health coverage under the state child health plan (CHIP). The bill applies existing eligibility criteria for health benefits coverage under CHIP to children in eligibility group A, and specifies that the coverage be in accordance with provisions governing cost sharing for copayment of services, an enrollment fee, or a portion of the CHIP premium, and that the child's family income be at or below 200 percent of the federal poverty level (Sec. 62.101). The bill establishes eligibility group B for children who meet all of the eligibility requirements of those in group A, have a family income that is greater than 200 percent but less than 300 percent of the federal poverty level, and satisfy any other eligibility standard imposed by rule by HHSC (Sec. 62.1015). The bill authorizes HHSC to apply for, receive, and administer gifts, grant, loans, and other funds available from any source for the CHIP eligibility group B account (Sec. 62.051). The bill requires HHSC to use money available in the CHIP eligibility group B account to subsidize benefits plan coverage for enrollees in eligibility group B and to require enrollees to share the cost of CHIP, including requiring enrollees under CHIP to pay a copayment for services, an enrollment fee, or a portion of the plan premium. If money is not available in the account to subsidize coverage for enrollees in eligibility group B, the enrollees are required to pay a plan premium in an amount actuarially determined to be sufficient in a manner specified by HHSC (Sec. 62.153). H.B. 2285 also authorizes the commissioner of health and human services (commissioner) to require enrollees under eligibility group B to pay the plan premium if appropriated money is insufficient to sustain enrollment (Sec. 62.1016). The bill authorizes HHSC to require enrollees to pay a copayment for services or an enrollment fee (Sec. 62.153). The bill specifies that federal money may not be used to provide coverage for or to pay costs attributed to children in eligibility group B, nor may expenditures made to provide coverage for children in eligibility group B be included to determine the state's CHIP expenditures (Sec. 62.201). The bill establishes the eligibility group B account as an account in the general revenue fund that consists of money transferred from the Texas healthy kids fund and enrollment fees charged to enrollees in eligibility group B. The bill specifies the expenses for which money in the fund may be used (Sec. 62.202). H.B. 2285 provides that a parent, managing conservator, or guardian (parent) of a child in eligibility group B is responsible for premiums for coverage and applicable enrollment fees and copayments. The bill sets forth measures which HHSC by rule may adopt to prevent the termination of coverage for children in eligibility group B (Sec. 62.203). The bill repeals the provisions establishing the Texas Healthy Kids Corporation (SECTION 2.07). The bill amends the Family and the Health and Safety codes to delete references to the Texas Healthy Kids Corporation, as well as related provisions (SECTIONS 2.01-2.06). The bill modifies the Tax Code to repeal the provision authorizing a nonprofit hospital to satisfy the requirement to provide charity care and community benefits by a donation of money to the Texas Healthy Kids Corporation (SECTION 2.08). The bill requires HHSC no later than 90 days after the effective date of this Act to submit for approval a plan amendment relating to CHIP under federal law to comply with the change in law made by this Act. HHSC and the Texas Healthy Kids Corporation are required to examine the rolls of children who are provided health benefits by the corporation and take actions necessary to transfer eligible children to CHIP when the necessary plan amendments have taken effect. HHSC is required to waive any waiting period for those children transferred to CHIP under this Act (SECTION 3.01). The bill requires the comptroller, effective on the date the plan amendments to CHIP take effect, to transfer all money in the Texas healthy kids fund to the CHIP eligibility group B account. If the amendments do not become effective before September 1, 2003, the comptroller is required to transfer this money to the general revenue fund. The bill provides for the continuation of the Texas healthy kids fund until all existing and outstanding assets are transferred to the CHIP eligibility group B account (SECTION 3.01). The bill authorizes the Texas Healthy Kids Corporation, notwithstanding the change in law made by this Act, to continue to offer the program provided by the corporation until the necessary plan amendments to CHIP are in effect or September 1, 2003, whichever date is earlier, after which the Texas Healthy Kids Corporation is terminated. No later than the 30th day after that date, the board of directors of the corporation is required to begin the steps necessary to dissolve the corporation (SECTION 3.02). EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001. Provisions regarding a donation of money to the Texas Healthy Kids Corporation take effect January 1, 2002, and apply to a tax report originally due on or after that date.