HBA-NMO C.S.S.B. 445 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.S.B. 445 By: Moncrief Public Health 4/9/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE Currently, the largest group of the estimated 1.4 million children in this state that do not have health insurance coverage are those children from low-income working families. Many of these children are not eligible for Medicaid or other public programs, and their parents may not have access to employer-based coverage. In an effort to increase the number of children with health insurance coverage, Congress has provided $48 billion over the next ten years through the Balanced Budget Act of 1997, under Title XXI of the Social Security Act, for the development of states' children's health insurance programs. In consideration of this provision, the recommendations of the Interim House Committee on Public Health include the implementation of Phase II of a state-designed Children's Health Insurance Program (CHIP) under Title XXI of the Social Security Act. C.S.S.B. 445 requires the Health and Human Services Commission (HHSC) to develop a statedesigned CHIP to obtain health benefits coverage for children in low income families. This bill requires HHSC to ensure that CHIP is designed and administered in a manner that qualifies it for federal funding, and provides that CHIP does not establish an entitlement and terminates at the time that federal funding terminates. 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 (Sections 62.051, 62.052, 62.053, and 62.058, Health and Safety Code); to the Texas Department of Health in SECTION 1 (Section 62.052, Health and Safety Code); to the Texas Department of Human Services in SECTION 1 (Sections 62.052 and 62.053, Health and Safety Code); and to the Texas Department of Insurance in SECTION 1 (Section 62.054, Health and Safety Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Title 2C, Health and Safety Code, by adding Chapter 62, as follows: CHAPTER 62. CHILD HEALTH PLAN FOR CERTAIN LOW-INCOME CHILDREN SUBCHAPTER A. GENERAL PROVISIONS Sec. 62.001. DEFINITION. Defines "commission" as the Health and Human Services Commission and "commissioner" as the commissioner of health and human services. Defines "health plan provider" and "net family income." Sec. 62.002. NOT AN ENTITLEMENT; TERMINATION OF PROGRAM. Provides that this chapter does not establish an entitlement to assistance in obtaining health benefits for a child. Provides that the program established under this chapter terminates at the time that federal funding terminates under Title XXI of the Social Security Act (42 U.S.C. Section 1397aa et seq.), as amended, unless a successor program providing federal funding for a state-designed child health plan program is created. Sec. 62.003. FEDERAL LAW AND REGULATIONS. Requires the commissioner to monitor federal legislation affecting Title XXI of the Social Security Act and changes to the federal regulations implementing that law. Requires the commissioner, if the commissioner determines that a change has occurred conflicting with this chapter, to report the changes to the governor, lieutenant governor, and the speaker of the house of representatives, with recommendations for legislation necessary to implement the federal law or regulations, seek a waiver, or withdraw from participation. SUBCHAPTER B. ADMINISTRATION OF CHILD HEALTH PLAN PROGRAM Sec. 62.051. DUTIES OF COMMISSION. (a) Requires the Health and Human Services Commission (HHSC) to develop a state-designed child health plan (plan) program (program) to obtain health benefits coverage for children in low-income families. Requires that the plan include an option for the parent of the child to participate in a medical savings account insurance program as defined in 26 U.S.C. Section 220(d)(1) and allow a parent's employer or other benefactor to contribute to the program. Requires HHSC to ensure that the child health plan and medical savings account program is designed and administered in a manner that qualifies it for federal funding. (b) Provides that HHSC is the agency responsible for making policy for the program, including policy related to covered benefits provided under the plan. Prohibits HHSC from delegating this duty to another agency or entity. (c) Requires HHSC to oversee the implementation of the program and coordinate the activities of each agency necessary for the implementation of the program. (d) Requires HHSC to adopt rules as necessary to implement this chapter. Authorizes HHSC to require certain departments or any other health and human services agency to adopt, with the approval of HHSC, any rules that may be necessary to implement the program. Authorizes HHSC to delegate to certain agencies the authority to adopt any rules that may be necessary to implement the program. (e) Requires HHSC to conduct a review of each entity that enters into a contract to implement any part of the child health plan program, including an entity with which HHSC contracts under Section 62.055 and each health plan provider, to ensure that the entity is available, prepared, and able to fulfill the entity's obligations under the contract in compliance with the contract, this chapter, and rules adopted under this chapter. Sec. 62.052. DUTIES OF TEXAS DEPARTMENT OF HEALTH. Authorizes HHSC to direct the Texas Department of Health (TDH) in the administration of the plan. Requires HHSC, or TDH under the direction of and in consultation with HHSC, to adopt rules as necessary to implement this section. Sec. 62.053. DUTIES OF TEXAS DEPARTMENT OF HUMAN SERVICES. Authorizes the Texas Department of Human Services (DHS) to perform certain tasks, under the direction of HHSC. Authorizes HHSC to direct DHS to perform certain tasks, if HHSC contracts with a third party administrator. Requires HHSC, or DHS under direction of and consultation with HHSC, to adopt rules as necessary to implement this section. Sec. 62.054. DUTIES OF TEXAS DEPARTMENT OF INSURANCE. Requires the Texas Department of Insurance (TDI) to provide any necessary assistance with the development of the plan, at the request of HHSC. Requires TDI to monitor the quality of the services provided by health plan providers and resolve grievances relating to the health plan providers. Authorizes HHSC and TDI to adopt a memorandum of understanding that addresses the responsibilities of each agency in developing the plan. Requires TDI, in consultation with HHSC, to adopt rules as necessary to implement this section. Sec. 62.055. CONTRACTS FOR IMPLEMENTATION OF CHILD HEALTH PLAN. Authorizes HHSC to contract with certain entities in administering the plan. Authorizes a third party administrator or other entity to perform tasks under the contract that would otherwise be performed by TDH to DHS under this chapter. Requires HHSC, if it elects to contract with a third party or other entity, including the Texas Healthy Kids Corporation, to retain all policymaking authority over the state child health plan; procure all contracts with a third party administrator or other entity through a competitive procurement process in compliance with all applicable federal and state laws or regulation; and ensure that all contracts with the plan providers under Section 62.155 are procured through a competitive procurement process in compliance with all applicable federal and state laws. Sec. 62.056. COMMUNITY OUTREACH CAMPAIGN; TOLL-FREE HOTLINE. Requires HHSC to conduct a community outreach and education campaign (campaign) to provide information relating to the availability of health benefits for children. Requires HHSC to conduct the campaign in a manner that promotes the goals of both programs and minimizes duplication of effort. Requires the campaign to include certain features. Requires HHSC to contract with community-based organizations to implement the community outreach campaign and also promote and encourage voluntary efforts to implement the community outreach campaign. Requires HHSC to award the contracts in the same manner that encourages broad participation of organizations, with an emphasis on organizations that target population groups with high levels of uninsured children. Authorizes HHSC to direct TDH or DHS to perform part of the outreach campaign. Requires HHSC to be responsible for informing each eligible child's parent as to the existence of the medical savings account insurance program option and providing the parent with the opportunity to choose or refuse to participate in the program. Sec. 62.057. ADVISORY COMMITTEE. Requires HHSC, not later than the 180th day before the date on which it plans to begin to provide health care services through the program, to appoint an advisory committee to provide recommendations on the implementation and operation of the program. Sets forth the composition of the advisory committee. Requires the advisory committee to meet at least quarterly and provides that it is subject to Chapter 551 (Open Meetings), Government Code. Provides that Section 2110.008 (Duration of Advisory Committees), Government Code, does not apply to the advisory committee. Sec. 62.058. FRAUD PREVENTION. Requires HHSC to develop and implement rules for the prevention and detection of fraud in the program. SUBCHAPTER C. ELIGIBILITY FOR COVERAGE UNDER CHILD HEALTH PLAN Sec. 62.101. ELIGIBILITY. (a) Provides that a child is eligible for health benefits coverage under the plan if the child is younger than 19 years of age; is not eligible for medical assistance under the Medicaid program; is not covered by a health benefits plan offering adequate benefits, as determined by HHSC, with exception; has a family income that is less than or equal to the income eligibility level established under Subsection (b); and satisfies any other eligibility standard imposed under the child health plan program in accordance with 42 U.S.C. Section 1397bb, as amended, and any other applicable law or regulations. (b) Requires HHSC to establish an income eligibility level consistent with Title XXI of the Social Security Act and any other applicable law or regulations, subject to the availability of appropriated money. Provides that a child who is younger than 19 years of age and whose net family income is at or below 200 percent of the federal poverty level is eligible for health benefits coverage under the program. Sec. 62.102. CONTINUOUS COVERAGE. Requires HHSC to provide that an individual who is determined to be eligible for coverage under the child health plan remains eligible for those benefits until a certain time. Sec. 62.103. APPLICATION FORM AND PROCEDURES. Requires HHSC, or DHS at the direction of and in consultation with HHSC, to adopt an application form and application procedures for requesting plan coverage and the medical savings account insurance program option under this chapter. Provides that the form and procedures be coordinated with forms and procedures under the Medicaid program and forms and procedures used by the Texas Healthy Kids Corporation so that a person is able to submit a single consolidated application to seek assistance under this chapter or the Medicaid program or from the corporation. Requires that the application form, to the extent possible, be made available in languages other than English. Authorizes HHSC to permit application to be made by mail, over the telephone, or through the Internet. Sec. 62.104. ELIGIBILITY SCREENING AND ENROLLMENT. (a) Requires HHSC, or DHS at the direction and in consultation with HHSC, to develop eligibility screening and enrollment procedures for children that comply with the requirements of 42 U.S.C. Section 1397bb, as amended, and any other applicable law or regulations. (b) Authorizes the Texas Integrated Enrollment Services eligibility determination system or a compatible system to be used to screen and enroll children under the plan. (c) Requires that the procedures ensure that Medicaid-eligible children are identified and assisted in applying for Medicaid coverage. (d) Requires that a child who applies for enrollment in the plan, who is denied Medicaid coverage after completion of a Medicaid application under Subsection (c), but who is eligible for enrollment in the plan, to be enrolled in the plan without further application or qualification. (e) Requires HHSC to report quarterly to the Health Care Information Council and the committees of both houses of the legislature with jurisdiction over the plan the number of children referred for Medicaid application under this section who are enrolled in the Medicaid program, and the number of children who are denied coverage under the Medicaid program because they failed to complete the application process. (f) Provides that a determination of whether a child is eligible for plan coverage under the program and the enrollment of an eligible child with a health plan provider must be completed in a timely manner, as determined by HHSC, but not later than the 30th day after the date a complete application is submitted on behalf of the child. (g) Requires that enrollment be open in the first year of implementation of the plan. Authorizes HHSC, thereafter, to establish enrollment periods. Sec. 62.105. COVERAGE FOR QUALIFIED ALIENS. Requires HHSC to provide coverage under the state Medicaid program and under the program established under this chapter to a child who is a qualified alien, as the term is defined by 8 U.S.C. Section 1641(b), if the federal government authorizes the state to provided that coverage. Requires HHSC to comply with any prerequisite imposed under the federal law to providing that coverage. SUBCHAPTER D. CHILD HEALTH PLAN Sec. 62.151. CHILD HEALTH PLAN COVER-AGE. (a) Requires that the plan to comply with this chapter and the coverage requirements prescribed by 42 U.S.C. Section 1397cc, as amended, and any other applicable law or regulations. (b) Requires HHSC to consider the health care needs of healthy children and children with special health care needs. Provides that the plan, at the time it is first implemented, must provide covered benefits in substantial compliance with the recommended benefits package described for a state-designed child health care plan by the Texas House of Representatives Committee on Public Health "CHIP" Interim Report to the 76th Legislature dated December 1, 1998, and the Senate Interim Committee on Children's Health Insurance Report to the 76th Legislature, dated December 1, 1998. Requires the commissioner to annually evaluate the covered benefits as appropriate, considering the information obtained in implementing the program and budgetary limitations. (c) Requires HHSC, in developing the plan, to ensure that primary and preventive health benefits do not include reproductive services. (d) Provides that the plan must allow an enrolled child with a chronic, disabling, or lifethreatening illness to select an appropriate specialist as a primary care physician. Sec. 62.152. APPLICATION OF INSURANCE LAW. Provides that, to provide the flexibility necessary to satisfy the requirements of Title XXI of the Social Security Act, as amended, and any other applicable law or regulations, the plan is not subject to a law that requires certain coverage. Sec. 62.153. COST SHARING. Authorizes HHSC to require enrollees to share the cost of the plan, including provisions requiring enrollees to pay certain costs. Requires cost-sharing provisions adopted under this section to ensure that families with higher levels of income are required to pay progressively higher percentages of the cost of the plan. Requires HHSC to specify the manner in which the premiums are to be paid, if cost-sharing provisions imposed under Subsection (a) include requirements that enrollees pay a portion of the plan premium. Authorizes HHSC to require that the premium be paid to TDH, DHS, or the health plan provider. Sec. 62.154. CROWD OUT. (a) Provides that, to the extent permitted under Title XXI of the Social Security Act, as amended, and any other applicable law or regulations, the plan must include a waiting period, and is authorized to include copayments and other provisions to discourage certain acts. (b) Provides that a child is not subject to a waiting period adopted under Subsection (a) if the family lost coverage for the child as a result of certain conditions or HHSC has determined that other grounds exist for a good cause exception. (c) Authorizes a child not subject to a waiting period for good cause exception to enroll in the program at any time, without regard to any open enrollment period established under the enrollment procedures. (d) Provides that the waiting period must extend for a period of 90 days after the date of application for coverage under the plan, and apply to a child who was covered by a health benefits plan at any time during the 90 days before the date of application for coverage under the plan, other than a child who was covered under a health benefits plan provided under Chapter109. Sec. 62.155. HEALTH PLAN PROVIDERS. Requires HHSC or TDH, at the direction of and in consultation with HHSC, to select the plan providers under the program through open enrollment or a competitive bid process. Provides that a plan provider must meet certain requirements. Sets forth provider selection procedure, including preferences given to managed care organizations and certain other providers, and commissioner authorized exception. Sec. 62.156. HEALTH CARE PROVIDERS. Provides that an individual health care provider who provides health care services under the plan must satisfy certification and licensure requirements, as required by HHSC, consistent with law. CHAPTER 63. HEALTH BENEFITS PLAN FOR CERTAIN CHILDREN Sec. 63.001. DEFINITION. Defines "commission." Sec. 63.002. HEALTH BENEFITS PLAN COVERAGE FOR CERTAIN CHILDREN. Requires HHSC to develop and implement a program to provide health benefits plan coverage for a child who is a qualified alien, as that term is defined by 8 U.S.C. Section 1641(b); is younger than 19 years of age; entered the U.S. after August 22, 1996; has resided in the U.S. for less than five years; and meets the income eligibility requirement of, but is not eligible for assistance under the child health plan program or the medical assistance program under Chapter 32, Human Resources Code. Sec. 63.003. BENEFITS COVERAGE REQUIRED. Provides that the program required by Section 63.002, to the extent possible, must provide benefits comparable to the benefits provided under the child health plan program under Chapter 62. Sec. 63.004. HEALTH BENEFITS PLAN PROVIDER. Sets forth requirements of a plan provider under this chapter. Sec. 63.005. COST-SHARING PAYMENTS. (a) Prohibits HHSC, except as provided by Subsection (b), from requiring a child who is provided plan coverage under Section 63.002 and who meets the income eligibility requirement of the medical assistance program under Chapter 32, Human Resources Code, to pay a premium, deductible, coinsurance, or other cost-sharing payment as a condition of health benefits plan coverage under this chapter. (b) Authorizes HHSC to require a child described by Subsection (a) to pay a co-payment as a condition of health benefits plan coverage under this chapter that is equal to any copayment required under the plan program under Chapter 62. (c) Authorizes HHSC to require a child who is provided plan coverage under Section 63.002 and who meets the income eligibility requirement of the program under Chapter 62 to pay a premium, deductible, coinsurance, or cost-sharing payment as a condition of plan coverage under this chapter. Provides that the payment must be equal to any premium, deductible, coinsurance, or other cost-sharing payment required under the program under Chapter 62. Sec. 63.006. DISALLOWANCE OF MATCHING FUNDS FROM FEDERAL GOVERNMENT. Prohibits expenditures made to provide plan coverage under this section from being included for the purpose of determining the state children's health insurance expenditures, as that term is defined by 42 U.S.C. Section 1397ee(d)(2)(B), as amended. SECTION 2. Amends Chapter 109, Health and Safety Code, by adding Subchapter F, as follows: SUBCHAPTER F. STATE CHILD HEALTH PLAN Sec. 109.201. DEFINITIONS. Defines "commission" and "state child health plan." Sec. 109.202. CHILD HEALTH PLAN COVERAGE. Authorizes HHSC to use appropriated funds, in accordance with the General Appropriations Act, to purchase coverage under the plan and to contract with the Texas Healthy Kids Corporation (corporation) for other services under this subchapter. Provides that the plan coverage offered under this subchapter must be approved by HHSC. Requires HHSC to ensure that coverage provided under this subchapter complies with Chapter 62. Sec. 109.203. ELIGIBILITY. Provides that an individual who is eligible for coverage under the plan, as determined by HHSC, notwithstanding any other provision of this chapter or the eligibility criteria established under Section 109.061 (Health Benefit Program), Health and Safety Code, is eligible for coverage provided through the corporation under this subchapter. Sec. 109.204. COMMUNITY OUTREACH; ELIGIBILITY SCREENING. Authorizes the corporation, under direction of HHSC, in connection with offering a plan under this subchapter, to take certain action. Provides that the eligibility screening and enrollment procedures used by the corporation comply with Chapter 62. Sec. 109.205. COMPETITIVE PROCUREMENT. Requires the corporation, if it is selected to offer plan coverage under this subchapter and subsequently as required by HHSC or otherwise appropriate, to use a competitive procurement process, satisfactory to HHSC, to ensure that the state receives the best value with respect to contracts with any third party administrator, and any eligible coverage providers. Requires the corporation, as part of the competitive procurement process, to evaluate the demonstrated capacity of any third party administrator to administer programs of similar size and complexity. Sec. 109.206. REPORTING AND ACCOUNTABILITY. Requires the corporation to report to HHSC as required by HHSC with respect to coverage and services under this subchapter. Requires HHSC to establish a procedure to monitor the provision of coverage and services under this subchapter. SECTION 3. Amends Section 4, Article 3.51-6, Insurance Code, as follows: Sec. 4. New Title: EXEMPTIONS. Makes conforming changes and those relating to recodification. SECTION 4. Requires HHSC, by September 1, 1999, to develop the plan and submit for approval a plan amendment relating to the child health plan under 42 U.S.C. Section 1397ff, as amended. SECTION 5. Requires HHSC, if before implementing any provision of Chapter 62 or 63 it determines that a waiver or authorization from a federal agency is necessary for implementation of that provision, to request the waiver or authorization and authorizes it to delay implementing that provision until the waiver or authorization is granted. SECTION 6. Requires that the first money becoming available to the state each fiscal year as a result of the Comprehensive Settlement Agreement and Release filed in the case styled The State of Texas v. The American Tobacco Co., et al., No. 5-96CV-91, in the United States District Court, Eastern District of Texas, be used to fund the child health plan program established by this state under Title XXI of the Social Security Act. SECTION 7. Requires the standing or other committees of the House of Representatives and Senate of the 76th Legislature that have jurisdiction over HHSC and other agencies related to the implementation of Chapter 62, Health and Safety Code, as identified by the speaker of the house of representatives and the lieutenant governor, to monitor the implementation of Chapter 62 and perform other related duties as required by the speaker of the house of representatives and lieutenant governor, as appropriate. SECTION 8. Requires HHSC, not later than September 1, 2000, to establish and implement the health benefits plan coverage program required by Chapter 63, Health and Safety Code. Authorizes HHSC to delay implementation of that program until a plan amendment relating to the child health plan under 42 U.S.C. Section 1397ff, is approved. SECTION 9. Requires the state to provide coverage under the state Medicaid program or under a program established under Title XXI of the Social Security Act, to a child described by Section 63.002, Health and Safety Code, if the federal government authorizes the state to provide that coverage. Requires HHSC or any other appropriate agency to comply with any prerequisites under the federal law to providing the coverage. SECTION 10.Emergency clause. Effective date: upon passage. COMPARISON OF ORIGINAL TO SUBSTITUTE The substitute differs from the original in SECTION 1, as follows: Modifies proposed Section 62.001, Health and Safety Code, by including the definitions of "health plan provider" and "net family income." Modifies proposed Section 62.002 by providing that the program established under this chapter terminates at the time that federal funding terminates under Title XXI of the Social Security Act (42 U.S.C. Section 1397aa et seq.), as amended, unless a successor program providing federal funding for a state-designed child health plan program is created, rather than or another law providing federal funding for a state-designed child health plan (plan). Adds Section 62.003 (Federal Law and Regulations). Modifies proposed Section 62.051 by requiring that the state designed health plan include an option for the parent of the child to participate in a medical savings account insurance program as defined in 26 U.S.C. Section 220(d)(1) and allow a parent's employer or other benefactor to contribute to the program. Adds Subsection (b) to provide that the Health and Human Services Commission (HHSC) is the agency responsible for making policy for the program, including policy related to covered benefits provided under the plan. Prohibits HHSC from delegating this duty to another agency or entity. Redesignates proposed Subsection (b) of as Subsection (c). Redesignates proposed Subsection (c) as Subsection (d) and makes changes to authorize HHSC to require certain agencies to adopt rules that may be necessary to implement the program, rather than may be adopted under this subsection. Adds Subsection (e) to require HHSC to conduct a review of each entity that enters into a contract to implement any part of the child health plan program, including an entity with which HHSC contracts under Section 62.055 and each health plan provider, to ensure that the entity is available, prepared, and able to fulfill the entity's obligations under the contract in compliance with the contract, this chapter, and rules adopted under this chapter. Makes conforming changes. Modifies proposed Section 62.052 by authorizing HHSC to direct the Texas Department of Health (TDH), rather than requiring TDH at the direction of HHSC, to administer the plan. Adds Subdivision (3) relating to monitoring the quality of services. Requires, rather than authorizes, HHSC, or TDH under the direction of and in consultation with HHSC, to adopt rules as necessary to implement this section. Makes conforming changes. Modifies proposed Section 62.053 by authorizing, rather than requiring, the Texas Department of Human Services (DHS), under the direction of HHSC, to perform certain tasks. Authorizes HHSC to direct DHS, rather than requiring DHS at the direction of HHSC, to perform certain tasks, if HHSC contracts with a third party administrator. Requires, rather than authorizes HHSC, or DHS under direction of and consultation with HHSC, to adopt rules as necessary to implement this section. Modifies proposed Section 62.054 by requiring, rather than authorizing, the Texas Department of Insurance (TDI), in consultation with HHSC, to adopt rules as necessary to implement this section. Makes conforming changes. Modifies proposed Section 62.055 by including eligibility screening with those services that HHSC is authorized to contract with a third party administrator. Requires HHSC, if it elects to contract with a third party or other entity, including the Texas Healthy Kids Corporation, to retain all policymaking authority over the state child health plan; procure all contracts with a third party administrator or other entity through a competitive procurement process in compliance with all applicable federal and state laws or regulations; and ensure that all contracts with the plan providers under Section 62.155 are procured through a competitive procurement process in compliance with all applicable federal and state laws. Deletes proposed language authorizing HHSC to require TDH or DHS to take certain action if HHSC enters into certain third party contracts. Modifies proposed Section 62.056 by removing the requirement of HHSC to coordinate with the Texas Healthy Kids Corporation in the conducting of the community outreach campaign (campaign). Provides that the campaign must include outreach efforts that involve schoolbased health clinics. Requires HHSC to contract with community-based organizations to implement the community outreach campaign and also promote and encourage voluntary efforts to implement the community outreach campaign. Requires HHSC to award the contracts in the same manner that encourages broad participation of organizations, with an emphasis on organizations that target population groups with high levels of uninsured children. Deletes proposed language regarding HHSC authorization to provide grants to community-based organizations to implement the campaign. Authorizes HHSC to direct TDH or DHS to perform part, rather than all or part, of the outreach campaign. Adds Subsection (e) to require HHSC to be responsible for informing each eligible child's parent as to the existence of the medical savings account insurance program option and providing the parent with the opportunity to choose or refuse to participate in the program. Makes conforming changes. Adds Section 62.057 (Advisory Committee). Adds Section 62.058 (Fraud Prevention). Modifies proposed Section 62.101 by providing an exception to the eligibility criteria stipulating that a child is not covered by a health benefits plan offering adequate benefits. Provides that a child who is younger than 19 years of age and whose net family income is at or below 200 percent of the federal poverty level is eligible for health benefits coverage under the program, rather than providing that children birth through 10 years of age whose net family income is at or below 200 percent of the federal poverty level, and children ages 11 through 18 years of age whose net family income is at or below 150 percent of the federal poverty level are eligible for health benefits coverage. Deletes proposed Subsections (c) and (d), relating to commissioner of heath and human services evaluation of enrollment levels. Modifies proposed Section 62.102 by authorizing HHSC, rather than requiring HHSC by rule, to provide that an individual who is determined to be eligible for coverage under the child health plan remains eligible for those benefits until a certain time. Modifies proposed Section 62.103 by removing the "to the extent possible" condition from the provision that provides that forms and procedures must be coordinated with those under the Medicaid program and those used by the Texas Health Kids Corporation. Requires that the application form, to the extent possible, be made available in languages other than English. Makes conforming changes. Modifies proposed Section 62.104 by creating Subsection (c) from language in proposed Subsection (a), and adding new Subsections (c), (d), (e), (f), and (g), relating to enrollment of children. Adds Section 62.105 (Coverage For Qualified Aliens). Modifies proposed Section 62.151 in Subsection (b) by providing that the plan, at the time it is first implemented, must provide covered benefits in substantial compliance with the recommended benefits package described for a state-designed child health care plan by the Texas House of Representatives Committee on Public Health "CHIP" Interim Report to the 76th Legislature dated December 1, 1998, and the Senate Interim Committee on Children's Health Insurance Report to the 76th Legislature, dated December 1, 1998. Requires the commissioner to annually evaluate the covered benefits as appropriate, considering the information obtained in implementing the program and budgetary limitations. Adds new Subsection (c) to require HHSC, in developing the plan, to ensure that primary and preventive health benefits do not include reproductive services. Deletes proposed language regarding the child health plan as it relates to coverage provided to state employees. Makes conforming changes. Modifies proposed Section 62.152 by providing that Section 62.155 (c) provides an exception to the provision providing that the plan is not is not subject to a law that requires coverage or the offer of coverage for the provision of services by a particular health care services provider. Modifies proposed Section 62.153 by making a conforming change. Modifies proposed Section 62.154 by providing that the plan must include a waiting period and authorizes it to include copayments and other provisions; rather than authorizing that the plan include waiting periods, copayments and other provisions; intended to discourage certain actions. Adds new Subsections (b), (c), and (d), relating to waiting periods. Modifies proposed Section 62.155 by providing the new title of "Health Plan Providers." Modifies proposed language in Subsection (b) and adds Subsections (c)-(f) to sets forth provider selection procedures, including preferences given to managed care organizations and certain other providers. Adds Section 62.156 (Health Care Providers). Deletes proposed Subchapter E (Legislative Oversight). Adds Chapter 63 (Sections 63.001-63.006) (Health Benefits Plan for Certain Children), relating to the provision of health benefits coverage to children who are qualified aliens and who meet certain other eligibility requirements. The substitute differs from the original in SECTION 2 by providing a new Section 109.205 (Competitive Procurement) and redesignating the proposed Section 109.205 as Section 109.206 (Reporting and Accountability). Makes conforming changes. The substitute differs from the original in SECTION 5 to make a conforming change. The substitute differs from the original in SECTION 6 by requiring that the first money becoming available to the state each fiscal year as a result of the Comprehensive Settlement Agreement and Release filed in the case styled The State of Texas v. The American Tobacco Co., et al., No. 5-96CV91, in the United States District Court, Eastern District of Texas, be used to fund the child health plan program established by this state under Title XXI of the Social Security Act. The substitute differs from the original in SECTION 7 by requiring the standing or other committees of the House of Representatives and Senate of the 76th Legislature that have jurisdiction over HHSC and other agencies related to the implementation of Chapter 62, Health and Safety Code, as identified by the speaker of the house of representatives and the lieutenant governor, to monitor the implementation of Chapter 62 and perform other related duties as required by the speaker of the house of representatives and lieutenant governor, as appropriate. The substitute differs from the original in SECTION 8 by requiring HHSC, not later than September 1, 2000, to establish and implement the health benefits plan coverage program required by Chapter 63, Health and Safety Code. Authorizes HHSC to delay implementation of that program until a plan amendment relating to the child health plan under 42 U.S.C. Section 1397ff, is approved. The substitute differs from the original in SECTION 9 by requiring the state to provide coverage under the state Medicaid program or under a program established under Title XXI of the Social Security Act, to a child described by Section 63.002, Health and Safety Code, if the federal government authorizes the state to provide that coverage. Requires HHSC or any other appropriate agency to comply with any prerequisites under the federal law to providing the coverage. SECTION 10 (Emergency Clause) of the substitute is redesignated from SECTION 6 of the original.