28 Tex. Admin. Code § 26.5 - Applicability and Scope
(a) Insurance Code
Chapter 1501, concerning Health Insurance Portability and Availability Act, and
this subchapter regulate all health benefit plans sold to small employers,
whether sold directly or through associations or other groupings of small
employers.
(b) Except as otherwise
provided, this subchapter applies to any health benefit plan providing health
care benefits covering two or more employees of a small employer, whether
provided on a group or individual franchise insurance policy basis, regardless
of whether the policy was issued in this state, if the plan meets one of the
following conditions:
(1) a portion of the
premium or benefits is paid by a small employer;
(2) the health benefit plan is treated by the
employer or by a covered individual as part of a plan or program for the
purposes of the United States Internal Revenue Code of 1986,
26 U.S.C. §
106 (concerning Contributions by Employer to
Accident and Health Plans) or §162 (concerning Trade or Business
Expenses);
(3) the health benefit
plan is a group policy issued to a small employer; or
(4) the health benefit plan is an employee
welfare benefit plan under 29 C.F.R. §
2510.3-1(j) (concerning
Employee Welfare Benefit Plan).
(c) For an employer that was not in existence
the previous calendar year, the determination of whether the employer is a
small employer is based on the average number of employees the employer
reasonably expects to employ on business days in the calendar year in which the
determination is made.
(d) The
provisions of Insurance Code Chapter 1501 and this subchapter apply to a health
benefit plan provided to a small employer or to the employees of a small
employer without regard to whether the health benefit plan is offered under or
provided through a group policy or trust arrangement of any size sponsored by
an association or discretionary group.
(e) If a small employer or the employees of a
small employer are issued a health benefit plan under the provisions of
Insurance Code Chapter 1501 and this subchapter, and the small employer, due to
an increase or decrease in the number of employees, ceases to meet the
definition of a small employer, the provisions of Insurance Code Chapter 1501
and this subchapter continue to apply to that particular health plan, subject
to the provisions of §
26.15 of this title (relating to
Renewability of Coverage and Cancellation). A health carrier providing coverage
to an employer must, within 60 days of becoming aware that the employer no
longer meets the definition of small employer, but not later than the first
renewal date occurring after the small employer has ceased to be a small
employer, notify the employer of its change in status. The carrier must also
notify the employer that the protections provided to small employers under
Insurance Code Chapter 1501, and this subchapter will cease to apply to the
employer if the employer fails to renew its current health benefit plan; fails
to comply with the contribution, minimum group size, or minimum participation
requirements of this subchapter; or elects to enroll in a different health
benefit plan. The notice requirement of this subsection does not apply to a
health carrier electing to issue coverage to a group consisting of one
employee.
(f) If a small employer
has employees in more than one state, the provisions of Insurance Code Chapter
1501 and this subchapter applicable to small employer plans, including
provisions regarding marketing and rates, apply to a health benefit plan issued
to the small employer if:
(1) the majority of
employees are employed in this state on the issue date or renewal date;
or
(2) the primary business
location is in this state on the issue date or renewal date and no state
contains a majority of the employees.
(g) A carrier licensed in this state that
issues a certificate of insurance covering a Texas resident is responsible for
ensuring that the certificate complies with applicable Texas insurance laws and
rules, including Senate Bill 1264, 86th Legislature, 2019, and other mandated
benefits, regardless of whether the group policy underlying the certificate was
issued outside the state.
(h) A
small employer nonfederal governmental employee health benefit plan that is not
self-funded is subject to the Insurance Code and this title, as applicable,
including Chapter 1501 and this chapter.
(i) This chapter is applicable to an
insurance policy, evidence of coverage, contract, or other document that is
delivered, issued for delivery, or renewed on or after September 1, 2017. An
insurance policy, evidence of coverage, contract, or other document that is
delivered, issued for delivery, or renewed prior to September 1, 2017, is
subject to the rules in effect at the time the insurance policy, evidence of
coverage, contract, or other document was delivered, issued for delivery, or
renewed.
Notes
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