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.