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Texas Department of Insurance
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Commissioner’s Bulletin # B-0051-03

December 29, 2003

To:   All Small Employer Health Benefit Plan Carriers

Re:   Actions by the 78th Texas Legislature amending Article 26.42, Texas Insurance Code pertaining to required small employer health benefit plans

The purpose of this bulletin is to remind carriers writing small employer health benefit plans of the requirement under Senate Bill 541 to offer small employers the opportunity to purchase a Consumer Choice Plan (CCP), which is a health benefit plan that, in whole or in part, does not offer or provide state-mandated health benefits.

The 78th Legislature enacted Senate Bill 541, which amended Article 26.42. Amended Article 26.42 deletes the requirement that small employer carriers offer the catastrophic care and basic coverages plans, and instead requires small employer carriers to offer small employers the opportunity to purchase a CCP along with a plan that contains all state-mandated benefits. The requirement is effective January 1, 2004.

To date, many small employer carriers have not filed CCP policy, certificate and evidence of coverage forms to be offered in the small employer market January 1, 2004. Small Carriers are advised that effective April 1, 2004, Life, Health & Licensing will be reviewing filings to determine compliance with amended Article 26.42. Life Health & Licensing will take appropriate steps to assure compliance with amended Article 26.42 including but not limited to referrals to the Legal Division for appropriate action.

The department has proactively expedited the review and approval of CCP filings and will continue to do so. Although rules implementing certain provisions of the new law have not yet been adopted, carriers may develop and file coverage forms based on the requirements of the law. While the rules will clarify certain provisions of the law, the statute provides sufficient direction for carriers to receive approval of policies, certificates and evidences of coverage prior to implementation of the rules. The department expects to publish proposed rules in the very near future. Carriers are encouraged to submit their filings as soon as possible. Filings will be reviewed in the order in which they are received. You may obtain copies of Senate Bill 541 at the website at

If you have any questions regarding this bulletin or the requirements of Article 26.42 please contact the Life/Health Division at 512-322-3409 or HMO Division at 512-322-4266.

Kimberly Stokes
Senior Associate Commissioner
Life, Health & Licensing

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