By: Duncan	S.B. No. 1332
	(Smithee)

	A BILL TO BE ENTITLED
	AN ACT
	relating to who is an employee for large and small employers for
	health benefit plans.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Subdivisions (8), (13), and (14), Section
	1501.002, Insurance Code, are amended to read as follows:
	(8)  "Large employer" means a person who employed an
	average of at least 51 [eligible] employees on business days during
	the preceding calendar year and who employs at least two employees
	on the first day of the plan year.  The term includes a governmental
	entity subject to Article 3.51-1, 3.51-4, or 3.51-5, to Subchapter
	C, Chapter 1364, to Chapter 1578, or to Chapter 177, Local
	Government Code, that otherwise meets the requirements of this
	subdivision.  For purposes of this definition, a partnership is the
	employer of a partner.
	(13)  "Premium" means all amounts paid by a small or
	large employer and [eligible] employees as a condition of receiving
	coverage from a small or large employer health benefit plan issuer,
	including any fees or other contributions associated with a health
	benefit plan.
	(14)  "Small employer" means a person who employed an
	average of at least two employees but not more than 50 [eligible]
	employees on business days during the preceding calendar year and
	who employs at least two employees on the first day of the plan
	year.  The term includes a governmental entity subject to Article
	3.51-1, 3.51-4, or 3.51-5, to Subchapter C, Chapter 1364, to
	Chapter 1578, or to Chapter 177, Local Government Code, that
	otherwise meets the requirements of this subdivision.  For purposes
	of this definition, a partnership is the employer of a partner.
	SECTION 2.  Section 1501.003, Insurance Code, is amended to
	read as follows:
	Sec. 1501.003.  APPLICABILITY:  SMALL EMPLOYER HEALTH
	BENEFIT PLANS. An individual or group health benefit plan is a
	small employer health benefit plan subject to Subchapters C-H if it
	provides health care benefits covering two or more [eligible]
	employees of a small employer and:
	(1)  the employer pays a portion of the premium or
	benefits;
	(2)  the employer or a covered individual treats the
	health benefit plan as part of a plan or program for purposes of
	Section 106 or 162, Internal Revenue Code of 1986 (26 U.S.C. Section
	106 or 162); or
	(3)  the health benefit plan is an employee welfare
	benefit plan under 29 C.F.R. Section 2510.3-1(j).
	SECTION 3.  Section 1501.004, Insurance Code, is amended to
	read as follows:
	Sec. 1501.004.  APPLICABILITY: LARGE EMPLOYER HEALTH
	BENEFIT PLANS. An individual or group health benefit plan is a
	large employer health benefit plan subject to Subchapters C and M if
	the plan provides health care benefits to [eligible] employees of a
	large employer and:
	(1)  the employer pays a portion of the premium or
	benefits;
	(2)  the employer or a covered individual treats the
	health benefit plan as part of a plan or program for purposes of
	Section 106 or 162, Internal Revenue Code of 1986 (26 U.S.C. Section
	106 or 162); or
	(3)  the health benefit plan is an employee welfare
	benefit plan under 29 C.F.R. Section 2510.3-1(j).
	SECTION 4.  Subsection (a), Section 1501.009, Insurance
	Code, is amended to read as follows:
	(a)  An independent school district may elect to participate
	as a small employer without regard to the number of [eligible]
	employees in the district. An independent school district that
	makes the election is treated as a small employer under this chapter
	for all purposes.
	SECTION 5.  Subsections (a) and (b), Section 1501.011,
	Insurance Code, are amended to read as follows:
	(a)  For an employer that did not exist throughout the
	calendar year preceding the year in which the determination of
	whether the employer is a small employer is made, the determination
	is based on the average number of employees [and eligible
	employees] the employer reasonably expects to employ on business
	days in the calendar year in which the determination is made.
	(b)  For an employer that did not exist throughout the
	calendar year preceding the year in which the determination of
	whether the employer is a large employer is made, the determination
	is based on the average number of [eligible] employees the employer
	reasonably expects to employ on business days in the calendar year
	in which the determination is made.
	SECTION 6.  The change in law made by this Act applies only
	to a health benefit plan delivered, issued for delivery, or renewed
	on or after January 1, 2014. A plan that is delivered, issued for
	delivery, or renewed before January 1, 2014, is governed by the law
	in effect immediately before the effective date of this Act, and
	that law continues in effect for that purpose.
	SECTION 7.  This Act takes effect September 1, 2013.