34 TAC §41.30
The Teacher Retirement System of Texas (TRS) adopts on an
emergency basis new §41.30 concerning participation in the Texas School
Employees Uniform Group Health Coverage Act by school districts, other educational
districts, charter schools, and regional education service centers. The new
section is adopted on an emergency basis pursuant to §2001.034 of the
Government Code, which allows a state agency to adopt an emergency rule if
a requirement of state or federal law requires adoption of the rule on less
than 30 days notice. The section is also adopted in accordance with §2001.006
of the Government Code, which allows the agency to adopt rules and take other
administrative action in preparation for the implementation of legislation
that has become law but has not taken effect. Adoption of the section will
allow TRS to prepare to implement House Bill 3343, which was passed by the
77th Legislature, 2001, (the "Act").
In accordance with the Act, the new section sets forth the manner, form
and effect of elections to opt in or out of participation in the coverage
under the Act. The section includes provisions regarding the deadlines for
certain entities to opt in or out of participation and the effect of such
elections.
This emergency adoption is necessary because the retirement system is required
to comply with timelines under the Act, including a requirement in section
5.03 of the Act that TRS provide written information to certain entities described
in the Act "not later than July 31, 2001" and requirements that certain entities
provide notice or make elections by September 1, 2001 in the manner prescribed
by TRS. Adoption of the new section on an emergency basis allows TRS to take
action to prepare to implement the new law, such as notifying interested parties
of applicable deadlines. However, the new section shall not become effective
until the date the new law becomes effective: September 1, 2001.
The agency has determined that this section is necessary and appropriate
in accordance with Government Code §2001.006, which allows the agency
to adopt rules and take other administrative action in preparation for the
implementation of legislation that has become law but has not taken effect.
In addition, the agency finds that requirements of state law (specifically
those found in sections 1.01 and 5.03 of the Act) require the adoption of
this new rule on fewer than 30 days notice.
The new section is adopted on an emergency basis under the Government
Code, Chapter 825, §825.102, which authorizes the Board of Trustees of
the Teacher Retirement System to adopt rules for the administration of the
funds of the retirement system and for the transaction of business of the
board. The new section is also adopted under House Bill 3343, which was passed
by the 77th Legislature, 2001. As described above, the section is also adopted
under Government Code §2001.006 and Government Code §2001.034. Alternatively,
the section is adopted under Insurance Code article 3.50-4, §§5
and 7A, which authorize TRS to adopt rules relating to the existing insurance
programs.
There are no other codes affected.
§41.30.Participation in the Texas School Employees Uniform Group Health Coverage Act by School Districts, Other Educational Districts, Charter Schools, and Regional Education Service Centers.
(a)
Manner, form and effect of election. All elections to opt
in or opt out of participation in the uniform group coverage under the Texas
School Employees Uniform Group Health Coverage Act (the "Act") pursuant to
the provisions of Insurance Code, Article 3.50-7, §§5 or 6, as added
by the 77th Legislature, 2001 in House Bill 3343 shall be in writing, on an
election form prescribed by the Teacher Retirement System of Texas ("TRS"),
and received by TRS no later than 5:00 p.m. on or before the applicable election
deadline date specified in this section. An election form otherwise valid
received by facsimile before the applicable deadline is acceptable if TRS
receives the original, signed election form within seven calendar days after
the applicable deadline. An incomplete or unsigned form will not be deemed
received by TRS for purposes of determining whether a valid election has been
exercised. A valid election filed with TRS is irrevocable once the election
deadline passes, unless TRS is authorized to extend a deadline and does so
by resolution of the TRS Board of Trustees. Entities electing to participate
in the uniform group coverage under the Act may not discontinue participation
unless authorized by Insurance Code, Article 3.50-7, and by appropriate rule
or resolution adopted by the TRS Board of Trustees. Entities opting out of
participation in the uniform group coverage under the Act have no further
opportunity to elect to participate except as authorized by Insurance Code,
Article 3.50-7, and by appropriate rule or resolution adopted by the TRS Board
of Trustees. If an entity has an option to opt in and thereby participate
in the coverage under the Act, a failure to properly or timely file the election
form shall have the effect of the entity electing not to participate. Likewise,
if an entity has an option to opt out and thereby not participate in the coverage
under the Act, a failure to properly or timely file the election form shall
have the effect of the entity electing to participate.
(b)
School districts with 500 or fewer employees. Pursuant
to Insurance Code, Article 3.50-7 §5(a), school districts with 500 or
fewer employees as of January 1, 2001 are required to participate effective
September 1, 2002 in the uniform group coverage under the Act, except that
certain of these school districts may delay or opt out of participation by
specified election deadlines as provided in paragraphs (1) through (3) of
this subsection. On or before September 1, 2001, all school districts must
furnish information and verifications requested by TRS on the form prescribed
by TRS, regardless of whether an election to delay or opt out of participation
applies to such district or is being exercised by such school district.
(1)
Pursuant to Insurance Code, Article 3.50-7 §5(g),
a school district with 500 or fewer employees as of January 1, 2001 that,
on January 1, 2001, was individually self-funded for the provision of health
care coverage to its employees may elect to opt out of the mandatory participation
in coverage effective September 1, 2002, by filing its election form with
TRS on or before September 1, 2001.
(2)
Pursuant to Insurance Code, Article 3.50-7 §5(e),
a school district with 500 or fewer employees as of January 1, 2001 that was
a member on January 1, 2001 of a risk pool established under the authority
of Local Government Code, Chapter 172, may opt out of the mandatory participation
in coverage effective September 1, 2002 by filing its election form with TRS
on or before September 1, 2001 and electing thereby to continue in the risk
pool that the district participated in on January 1, 2001.
(3)
Pursuant to Insurance Code, Article 3.50-7 §5(h),
a school district with 500 or fewer employees as of January 1, 2001 that is
a party to a contract for the provision of health insurance coverage to the
employees of the district that is in effect on September 1, 2002 may delay
mandatory participation in coverage effective September 1, 2002, by filing
its election with TRS on or before September 1, 2001. At the time of such
election, such a school district must provide the expiration date of the contract
to TRS and shall begin mandatory participation in the uniform group coverage
under the Act on the first day of the month immediately following the month
in which termination or expiration of the contract occurs.
(c)
School districts with 501 or more employees. Pursuant to
Insurance Code, Article 3.50-7 §5(b), school districts with 501 or more
employees on January 1, 2001 may elect to participate in the uniform group
coverage under the Act, with coverage effective September 1, 2005. January
1, 2005 is the deadline for such a school district to file its election with
TRS to participate in the uniform group coverage under the Act. Notwithstanding
the preceding two sentences, school districts with 501 or more employees may
elect to participate prior to September 1, 2005 as set forth in paragraphs
(1) and (2) of this subsection. All school districts must furnish information
and verifications to TRS on or before September 30, 2001 on a form prescribed
by TRS, regardless of whether an election to participate prior to September
1, 2005 applies to such district or is being exercised by such district.
(1)
Pursuant to Insurance Code, Article 3.50-7 §5(b-1),
school districts may elect to participate prior to September 1, 2005 if TRS
determines that participation prior to September 1, 2005 by school districts
with more than 500 employees on January 1, 2001 would be administratively
feasible and cost-effective. TRS will set the election deadline from time
to time by rule or resolution of the TRS Board of Trustees, as applicable.
(2)
Pursuant to Insurance Code, Article 3.50-7 §5(a-1),
September 30, 2001 is the deadline for a school district with at least 501
but not more than 1,000 employees on January 1, 2001 to file its election
to commence participation effective September 1, 2002. A school district that
does not elect to opt in early and participate effective September 1, 2002,
may elect in the future to opt in if otherwise permitted under this subsection.
(d)
Educational districts. Pursuant to Insurance Code, Article
3.50-7 §5(i), educational districts whose employees are members of TRS
are required to participate effective September 1, 2002 in the uniform group
coverage under the Act, except that educational districts with 500 or fewer
employees on January 1, 2001 may opt out of participation. September 1, 2001
is the deadline for such an educational district to file its election with
TRS to opt out of participation in the uniform group coverage under the Act.
Regardless of whether an educational district elects to opt out of participation
and file an election form, information and verifications requested by TRS
must be furnished by all educational districts on the form prescribed by TRS
and returned to TRS on or before September 1, 2001.
(e)
Charter schools. Pursuant to Insurance Code, Article 3.50-7 §6,
an open-enrollment charter school established under Education Code, Chapter
12, Subchapter D, ("charter school") may elect to participate in the uniform
group coverage under the Act. Only an eligible charter school may elect to
participate. A charter school that received funding in accordance with Education
Code, Chapter 12, prior to June 1, 2001, must furnish information and verifications
requested by TRS, on the form prescribed by TRS, on or before September 1,
2001, whether or not the charter school elects to participate in the uniform
group coverage.
(1)
Pursuant to Insurance Code, Article 3.50-7 §6(a),
to be eligible, a charter school must agree to inspection of all records of
the school relating to its participation in the uniform group coverage under
the Act by TRS, by the administering firm as defined in Insurance Code, Article
3.50-7 §2(1), by the commissioner of education, or by a designee of any
of those entities, and further must agree to have its accounts relating to
participation in the uniform group coverage under the Act annually audited
by a certified public accountant at the school's expense. The agreement of
the charter school shall be evidenced in writing and shall constitute a part
of the election form prescribed by TRS pursuant to subsection (a) of this
section.
(2)
Pursuant to Insurance Code, Article 3.50-7 §6(b),
an eligible charter school shall elect to participate in the uniform group
coverage under the Act effective September 1, 2002, by filing its election
form with TRS on or before September 1, 2001 if the charter school received
any state funding in accordance with Education Code, Chapter 12, prior to
June 1, 2001.
(3)
Pursuant to Insurance Code, Article 3.50-7 §6(b),
an eligible charter school that did not receive any state funding in accordance
with Education Code, Chapter 12, prior to June 1, 2001, shall elect, if at
all, to participate in the uniform group coverage under the Act by filing
its election form with TRS on or before the later of September 1, 2001 or
the ninetieth calendar day following the date the Texas Education Agency authorized
the Comptroller to issue the first payment of state funds to such charter
school. Participation in coverage for such eligible charter school shall be
effective on the later of September 1, 2002 or the first day of the month
following the month in which a valid election to participate is filed with
TRS.
(f)
Regional education service centers. Pursuant to Insurance
Code, Article 3.50-7 §5(a), each regional education service center established
under Education Code, Chapter 8, is required to participate effective September
1, 2002 in the uniform group coverage under the Act. Information and verifications
requested by TRS must be furnished by each regional education service center
on the form prescribed by TRS and returned to TRS on or before September 1,
2001.
(g)
This section becomes effective at the earliest date permitted
by law, but not later than September 1, 2001.
This agency hereby certifies that the emergency adoption
has been reviewed by legal counsel and found to be within the agency's legal
authority to adopt.
Filed with the Office of
the Secretary of State,on July 2, 2001.
TRD-200103733
Charles Dunlap
Executive Director
Teacher Retirement System
Effective date: September 1, 2001
Expiration date: December 30, 2001
For further information, please call: (512) 391-2115