Texas Department of Insurance

Frequently Asked Questions and Answers Senate Bill 541

The Texas Department of Insurance has adopted rules implementing the provisions of Senate Bill 541, which established Texas Consumer Choice Health Benefit Plans. In an effort to provide guidance to entities offering Consumer Choice Health Benefit Plans, TDI has prepared some FAQs concerning questions it has received about these plans. These comments also are merely instructive and do not have the force and effect of law, as do the rules.

Q. Are Consumer Choice Health Benefit Plans issued to small employers required to include coverage for certain benefits for children pertaining to immunizations and screening test for hearing impairment as required by Article 21.53F, Texas Insurance Code?

A. While the Article 21.53F childhood immunizations and hearing screening tests are required mandated benefits under SB 541 for individual and large group plans, the article by its own terms does not apply to small employer health benefit plans. Thus, the law does not require Consumer Choice Health Benefit Plans issued to a small employer to include these particular Article 21.53F benefits.

Q. Are Consumer Choice Health Benefit Plans required to include coverage for nutritional supplements for Phenylketonuria (PKU) and other heritable diseases as provided by Article 3.79, Texas Insurance Code?

A. SB 541 specifically excepts coverage for the dietary treatment of PKU as required by Article 3.79 from the scope of "state-mandated health benefits," and thus carriers must comply with any mandates provided in that article.

Q. Are Consumer Choice Health Benefit Plans required to include coverage for Serious Mental Illness as required by Article 3.51-14, Texas Insurance Code?

A. SB 541 limits the coverage for serious mental illness under Article 3.51-14 to instances where a carrier has issued the consumer choice health benefit plan to a large employer.

Q. Are Consumer Choice Health Benefit Plans required to offer coverage for In Vitro Fertilization as required by Article 3.51-6, Section 3A, Texas Insurance Code?

A. The stated purpose of SB 541 is to allow health carriers to issue plans that do not offer or provide state-mandated health benefits, and the bill defines such plans accordingly. The bill exempts carriers from "offering" state-mandated benefits as well as from "providing" them. Thus a health carrier issuing a plan under SB 541 would be exempt from the Article 3.51-6 requirement that it offer coverage for in vitro fertilization services and benefits even if a plan otherwise provides pregnancy-related benefits.

Q. Are Consumer Choice Health Benefit Plans required to offer coverage for Mental Health as required by Article 3.70-2(F), Texas Insurance Code?

A. The stated purpose of SB 541 is to allow health carriers to issue plans that do not offer or provide state-mandated health benefits, and the bill defines such plans accordingly. The bill exempts carriers from "offering" state-mandated benefits as well as from "providing" them. Thus a health carrier issuing a plan under SB 541 would be exempt from the Article 3.70-2(F) requirement that it offer coverage for mental health benefits.

Q. Are Consumer Choice Health Benefit Plans required to offer coverage for Speech and Hearing as required by Article 3.70-2(G), Texas Insurance Code?

A. The stated purpose of SB 541 is to allow health carriers to issue plans that do not offer or provide state-mandated health benefits, and the bill defines such plans accordingly. The bill exempts carriers from "offering" state-mandated benefits as well as from "providing" them. Thus a health carrier issuing a plan under SB 541 would be exempt from the Article 3.70-2(G) requirement that it offer coverage for speech and hearing benefits.

Q. Are Consumer Choice Health Benefit Plans required to offer coverage for Home Health as required by Article 3.70-3B, Texas Insurance Code?

A. The stated purpose of SB 541 is to allow health carriers to issue plans that do not offer or provide state-mandated health benefits, and the bill defines such plans accordingly. The bill exempts carriers from "offering" state-mandated benefits as well as from "providing" them. Thus a health carrier issuing a plan under SB 541 would be exempt from the Article 3.70-3B requirement that it offer coverage for home health services.

Q. Are Consumer Choice Health Benefit Plans required to include coverage for Diabetes?

A. SB 541 requires a consumer choice health benefit plan subject to Article 21.53G, and the related rules at 28 TAC §21.2601 et seq., to cover the required supplies and services related to the treatment of diabetes. The law does not require a plan that is not subject to Article 21.53G (e.g., small employer health benefit plans) to comply with the article and related rules. A carrier offering a consumer choice health benefit plan is not required to comply with the provisions of Texas Insurance Code Article 21.53D (Guidelines for Diabetes Care) and the related rules at 28 TAC §21.2601 et seq. that do not relate to supplies and services associated with the treatment of diabetes.

Q. Are carriers required to continue to renew the small employer mandated basic and catastrophic plans or can they be discontinued?

A. In light of the enactment of S.B. 541, carriers may discontinue the small employer mandated basic and catastrophic plans pursuant to Article 26.24 by providing notice to each small employer of the discontinuation before the 90th day preceding the date of discontinuance of the coverage and offering to each employer the option to purchase other small employer plans.

Q. Section 6 of SB 541 has a disclosure statement requirement. What are health carriers supposed to do if the applicant-employer does not sign and return the disclosure statement?

A. Prior to the issuance of a consumer choice health benefit plan, a health carrier may not process an application until the health carrier has secured the signed disclosure statement from the applicant. Subsequent to the issuance of a consumer choice health benefit plan, the failure of a policyholder or contractholder to return the signed disclosure statement to the health carrier does not require action by the health carrier. In the absence of a signed disclosure statement, however, a health carrier must be able to furnish proof that it tendered the disclosure statement, with a request to sign and return it, to the policyholder or contractholder in accordance with proposed §21.3545(c)(2) of this subchapter (relating to Health Carrier Disclosure).

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