SECTION 26.521. Small Employer Participation

(a) In accordance with the Insurance Code §1508.002(7), qualifying small employers must have at least two but no more than 50 eligible employees.

(b) Qualifying small employers must offer coverage to all persons who are considered to be eligible employees as defined in §26.502(2) of this subchapter (relating to Definitions) for the purpose of determining the employer's eligibility to purchase a qualifying group health benefit plan, at least 30 percent of which must be eligible employees who are earning annual wages from the employer equal to or less than 300 percent of the poverty guidelines for an individual as defined and updated annually by the United States Department of Health and Human Services, or as adjusted by the commissioner in accordance with the Insurance Code §1508.052(b).

(c) Qualifying small employers must offer coverage to each dependent of an eligible employee. An eligible employee's spouse and dependent children younger than age 25 shall be considered eligible dependents under qualifying group health benefit plans.

(d) Qualifying small employers may offer coverage to part-time employees working at least 20 hours per week, and their dependents. Part-time employees or their dependents to whom coverage may be offered are not eligible employees for purposes of determining the small employer's eligibility to purchase a qualifying group health benefit plan pursuant to the Insurance Code §1508.051(a)(2) and §1508.053 and subsections (e) and (f) of this section.

(e) Qualifying small employers must, in accordance with the Insurance Code §1508.051 and §1508.053, have eligible employees as defined in §26.502(2) of this subchapter who meet the criteria specified in paragraphs (1) - (3) of this subsection.

(1) At least 30 percent of eligible employees must earn annual wages from the employer equal to or less than 300 percent of the poverty guidelines for an individual as defined and updated annually by the United States Department of Health and Human Services, or as adjusted by the commissioner in accordance with the Insurance Code §1508.052(b).

(2) At least 60 percent of eligible employees must participate in group health insurance coverage through the Healthy Texas Program.

(3) At least one eligible employee earning annual wages from the employer equal to or less than 300 percent of the poverty guidelines for an individual as defined and updated annually by the United States Department of Health and Human Services, or as adjusted by the commissioner in accordance with the Insurance Code §1508.052(b) must participate in group health insurance coverage through the Healthy Texas Program.

(f) On behalf of participating employees, qualifying small employers must contribute at least 50 percent of the premium charge for each employee for the qualifying group health benefit plan, except as provided in this division and Division 4 of this subchapter (relating to Participation by Regional and Local health Care Programs). Qualifying small employers may choose the level of any premium contribution to be made on behalf of dependents of employees and/or part-time employees or their dependents, but such employers are not required to make an employer contribution to the premium paid to a group health benefit plan issuer for dependent or part-time employee coverage.

(g) A qualifying small employer's place of business must be located within the State of Texas in order for the small employer to be eligible to purchase a qualifying group health benefit plan.

(h) In accordance with the Insurance Code §1508.051(a)(1), qualifying small employers shall in no case include any small employers who have provided group health insurance covering any of their employees at any time during the 12-month period preceding the date of application. Small employer applicants shall be considered to have provided group health insurance if they have arranged for group health insurance coverage (insured or self-insured) on behalf of their employees and have either contributed more than a de minimus amount towards the cost of coverage on behalf of their employees or provided coverage that exceeds the threshold specified in paragraph (2) of this subsection.

(1) De minimus contributions are those that are less than an average of $50 per employee per month, based on the number of employees at the time the coverage was provided. Small employers who have paid more than this amount are not qualified to purchase health insurance coverage through the Healthy Texas Program.

(2) A health benefit plan providing coverage with an annual maximum benefit level equal to or greater than $50,000 exceeds the threshold for arranging for employee group health insurance.

(i) Mid-year fluctuations in group size, wage levels and employee participation shall not serve as a basis for termination of a qualifying group health benefit plan.

(j) Upon initial application by a small employer, a participating health benefit plan issuer shall collect and examine employer certifications of eligibility and any supporting documentation to determine eligibility for a qualifying group health benefit plan and compliance with the terms of the Healthy Texas Program. A small employer must provide the participating health benefit plan issuer with information requested to enable the participating health benefit plan issuer to process the employer eligibility certification.

(k) A qualifying small employer may impose waiting periods which newly hired workers must satisfy in advance of obtaining coverage under the small employer's qualifying group health benefit plan.

(1) The waiting period shall not exceed 90 days from the date of hire.

(2) The waiting period must be the same for all newly hired workers.

Source Note: The provisions of this §26.521 adopted to be effective March 16, 2010, 35 TexReg 2174