HBA-SEB S.B. 97 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 97 By: Harris Pensions and Investments 3/25/1999 Engrossed BACKGROUND AND PURPOSE Currently, the fastest growing age group in Texas is the elderly, and the largest public funding source for the long-term care services they may require is Medicaid. As more Texans need long-term care services, there will be fewer working adults to support these retirees. S.B. 97 creates the Public Employees Long-Term Care Board to provide an optional long-term care insurance program for public employees. 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. SECTION BY SECTION ANALYSIS SECTION 1. Amends Subchapter E, Chapter 3, Insurance Code, by adding Article 3.50-2A, as follows: Article 3.50-2A. LONG-TERM CARE FOR PUBLIC EMPLOYEES Sec. 1. LONG-TERM CARE BOARD. Creates the Public Employees Long-Term Care Board (board), consisting of the executive directors of the Teacher Retirement System of Texas, the Employees Retirement System of Texas, the Texas County and District Retirement System, and the Texas Municipal Retirement System; and seven public members appointed by the governor. Establishes that executive directors serve as members of the board by virtue of their position as executive directors. Establishes a two-year term for public members to expire February 1 of each odd-numbered year. Requires the members of the board to select presiding officers annually. Requires the board to meet at the call of the presiding officer. Provides that a member of the board is not entitled to compensation for service on the board, except for reimbursement of travel expenses as provided in the General Appropriations Act. Sec. 2. EMPLOYEES AND CONSULTANTS. Authorizes the board to employ and contract with persons to assist in the performance of its powers and duties and to determine those persons' duties and compensation. Sec. 3. LONG-TERM CARE COVERAGE. Requires the board to contract with carriers offering long-term care insurance plans and enter into health care service plan contracts covering long-term care. Requires the board to award contracts to carriers qualified to provide long-term care benefits. Authorizes the board to develop and administer self-funded long-term care insurance plans. Authorizes the board to offer one or more long-term care insurance plans or health care service plan contracts and to offer service and indemnity plans. Requires the long-term care plan to include home, community, and institutional care. Establishes that a contract entered into under this section is subject to competitive bidding. Requires the long-term care plans to be made available periodically during open enrollment periods. Sec. 4. ENROLLMENT. Requires the board to establish eligibility criteria for enrollment eligibility and underwriting, define the scope of covered benefits, define criteria to receive benefits, and set any other necessary standards. Establishes the persons eligible to enroll in the long-term care program. Requires a potential enrollee to meet the eligibility and underwriting criteria established by the board. Requires the enrollee to pay the full cost of enrollment. Sec. 5. PUBLIC EMPLOYEES LONG-TERM CARE FUND. Establishes the public employees long-term care fund as a trust fund outside the state treasury. Establishes the comptroller as custodian of the fund and requires that payments from the fund be made at the direction of the board. Authorizes the board to set premiums for any self-funded long-term care plan to recover the administrative costs of the public employees long-term plan. Requires that enrollees' premiums, amounts recovered under contracts for the implementation of the long-term care program, and investment and depository income be credited to the fund. Authorizes the legislature to make appropriations to the fund. Authorizes the money in the fund to only be used for administering self-funded long-term care plans and administrative expenses of the long-term care program. Specifies that the fund is only subject to legislative appropriation in that the legislature in the General Appropriations Act may limit the amount that may be used to pay administrative expenses. Sec. 6. INVESTMENT OF FUND. Authorizes the board to invest assets of the fund in any investment in which an asset of a retirement system of which the executive director is a member of the board may be invested. Specifies that the board is subject to the investment standard provided by Section 67(a)(3), Article XVI, Texas Constitution (State and Local Retirement Systems). Authorizes the board to employ persons to manage the investments of the fund. Sec. 7. IMPLEMENTATION. Requires the board to implement the long-term care program when determined feasible. SECTION 2. Requires the board, if it does not implement the long-term care program before January 1, 2001, to file a report with the governor, the lieutenant governor, and the speaker of the house of representatives before that date making recommendations for the resources necessary to implement the program. SECTION 3. Effective date: September 1, 1999. SECTION 4. Emergency clause.