Texas Administrative Code › Title 28 - INSURANCE › Part 1 - TEXAS DEPARTMENT OF INSURANCE › Chapter 26 - EMPLOYER-RELATED HEALTH BENEFIT PLAN REGULATIONS › Subchapter A - DEFINITIONS, SEVERABILITY, AND SMALL EMPLOYER HEALTH REGULATIONS › Section 26.8 - Guaranteed Issue, Contribution, and Participation Requirements

Current through Reg. 49, No. 28; July 12, 2024
(a) A small employer carrier must issue a
				  health benefit plan to any small employer that elects to be covered under the
				  plan and agrees to satisfy other requirements of the plan without regard to
				  health-status-related factors.
(b)
				  Health carriers may require small employers to answer questions designed to
				  determine the level of contribution by the small employer, the number of
				  employees and eligible employees of the small employer, and the percentage of
				  participation of eligible employees of the small employer. In this section, an
				  "eligible employee" does not include employees within their waiting or
				  affiliation period for percentage of participation requirement
				  purposes.
(c) Availability of
				  coverage under a small employer health benefit plan is subject to the minimum
				  participation requirements of Insurance Code §
										1501.154
				  (concerning Minimum Participation Requirement) and §1501.155 (concerning
				  Exception to Minimum Participation Requirement) . A small employer that has
				  only two eligible employees will be subject to a 100 percent participation
				  requirement.
(d) A health carrier
				  must treat all similarly situated small employer groups in a consistent and
				  uniform manner when terminating health benefit plans due to a participation
				  level of less than the qualifying participation level or group size.
(e) If a small employer fails to meet the
				  qualifying minimum participation requirement for a small employer health
				  benefit plan for six consecutive months, the health carrier may terminate
				  coverage under the plan on the first renewal date following that period. The
				  termination must conform to the terms and conditions of the plan concerning
				  termination for failure to meet the qualifying minimum participation
				  requirement and in accordance with Insurance Code §§
										1501.108
				  -
				  1501.111
				  (concerning Renewability of Coverage; Cancellation; Refusal to Renew;
				  Discontinuation of Coverage; Notice to Covered Persons; and Written Statement
				  of Denial, Cancellation, or Refusal to Renew Required) and §
										26.15
				  of this title (relating to Renewability of Coverage and
				  Cancellation).
(f) In determining
				  whether an employer has the required percentage of participation of eligible
				  employees, if the percentage of eligible employees is not a whole number, the
				  result of applying the percentage to the number of eligible employees must be
				  rounded down to the nearest whole number. For example: 75 percent of five
				  employees is 3.75, so 3.75 would be rounded down to three , and 75 percent
				  participation by a five employee group will be achieved if three of the
				  eligible employees participate.
(g)
				  If a small employer fails to meet, for six consecutive months, the qualifying
				  minimum group size requirement set forth in Insurance Code Chapter 1501
				  (concerning Health Insurance Portability and Availability Act) for a small
				  employer health benefit plan, the health carrier may terminate coverage under
				  the plan no earlier than the first day of the next month following the end of
				  that period. The termination must conform to the terms and conditions of the
				  plan concerning termination for failure to meet the qualifying minimum group
				  size requirement and in accordance with Insurance Code §§
										1501.108
				  - 1501.111 and §
										26.15
				  of this title .