Part 1. COMPTROLLER OF PUBLIC ACCOUNTS

Chapter 5. FUNDS MANAGEMENT (FISCAL AFFAIRS)

Subchapter E. CLAIMS PROCESSING--PURCHASE VOUCHERS

34 TAC §5.58

The Comptroller of Public Accounts adopts new §5.58, concerning recovery of certain state agency overpayments, without changes to the proposed text as published in the March 3, 2006, issue of the Texas Register (31 TexReg 1416). A brief description of the new section follows.

Subsection (a) defines important terms used in the section.

Subsection (b) specifies the scope of the recovery audit program, including the criteria for determining whether a state agency is exempt from the program.

Subsection (c) requires a state agency to cooperate fully with the recovery audit program. The subsection also specifies the circumstances under which a state agency may direct a consultant not to pursue recovery of a payment that the consultant considers to be an overpayment.

Subsection (d) governs the deposit of money recovered by a state agency under the recovery audit program.

No comments were received regarding adoption of the new section.

The new section is adopted under Government Code, §2115.003.

The new section implements Government Code, Chapter 2115.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 12, 2006.

TRD-200602122

Martin Cherry

Chief Deputy General Counsel

Comptroller of Public Accounts

Effective date: May 2, 2006

Proposal publication date: March 3, 2006

For further information, please call: (512) 475-0387

Chapter 65. EXECUTIVE DIRECTOR

34 TAC §65.3

The Employees Retirement System of Texas (System) adopts amendments to §65.3, concerning Records of the System, without changes to the proposed text as published in the March 10, 2006, issue of the Texas Register (31 TexReg 1611).

This rule is adopted so that the amount of the charges allowed for providing public information and copies of public information in the possession of the System will conform to statewide standards.

No comments were received on the proposed amendments.

The amendments are adopted under Texas Government Code §815.102, which provides authorization for the Board of Trustees to adopt rules for the transaction of any other business of the board. No other statutes are affected by the adopted amendments.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 13, 2006.

TRD-200602126

Paula A. Jones

General Counsel

Employees Retirement System of Texas

Effective date: May 3, 2006

Proposal publication date: March 10, 2006

For further information, please call: (512) 867-7421

34 TAC §73.17

The Employees Retirement System of Texas (ERS) adopts amendments to §73.17, concerning Disability Retirement--Eligibility, without changes to the proposed text as published in the March 10, 2006, issue of the Texas Register (31 TexReg 1612).

Section 73.17 is adopted to clarify the executive director's authority to request medical and other information in connection with Texas Government Code §814.208 and related statutes from ERS disability retirees to determine whether such retirees continue to meet the eligibility requirements for disability retirement and associated health insurance benefits as provided in Texas Government Code §§814.201 - 814.211 and Texas Insurance Code Chapter 1551. This section is also adopted in order to define the term "comparable pay" and to affirm ERS staff's authority and practice in calculating and adjusting comparable pay to reflect changes in state pay that a disability retiree would likely have realized if he or she had not retired.

No comments were received on the proposed amendments.

The amendments are adopted under Texas Government Code, §815.102 which provides authorization for the Board of Trustees to adopt rules relating to the administration of the funds of the retirement system and for the transaction of other business of the Board. No other statutes are affected by the adopted amendments.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 13, 2006.

TRD-200602127

Paula A. Jones

General Counsel

Employees Retirement System of Texas

Effective date: May 3, 2006

Proposal publication date: March 10, 2006

For further information, please call: (512) 867-7421

34 TAC §§81.1, 81.3, 81.5, 81.7 - 81.9, 81.11

The Employees Retirement System of Texas (ERS) adopts amendments to §§81.1, 81.3, 81.5, 81.7, 81.9, and 81.11, and new rule, §81.8, without changes to the proposed text as published in the March 10, 2006, issue of the Texas Register (31 TexReg 1612).

New §81.8 and amendments to §§81.1, 81.3, 81.7, and 81.9 concern the establishment of an incentive credit to waive health coverage, an optional TRICARE Supplemental health plan under the Texas Employees Group Benefits Program (GBP), and non-substantive administrative modifications of the rules. The TRICARE Supplemental health plan is contingent upon the selection of a qualified Carrier by the ERS Board of Trustees. These rules are adopted in order to update and clarify the rules and to comply with and conform to House Bill 417 and Senate Bill 1863, 79th Legislature, Regular Session, as they may be harmonized in light of changes made to the same section of the law. Both bills authorize a TRICARE Supplement for those eligible participants who waive health coverage, and Senate Bill 1863 creates an incentive credit to be applied toward the premium of either optional coverage or the TRICARE Supplement for those eligible participants who waive health coverage.

Section 81.1 is adopted to add definitions for TRICARE and the TRICARE Supplement and to clarify that TRICARE Supplement premiums are included in the definition of Insurance premium expense.

Section 81.3 is adopted to add subsection (c) to provide statutory references for board approval of one or more TRICARE Supplement Carrier(s) to offer supplemental health benefits to eligible GBP participants who waive health coverage.

Section 81.7 is adopted to: (1) reference new §81.8 regarding the participation and enrollment requirements for those new employees and retirees who are eligible to waive health coverage and receive an incentive credit; (2) allow an annual opportunity to waive health coverage; (3) add the TRICARE Supplement as an optional coverage; and (4) make conforming reference changes.

Section 81.7(g)(1) is adopted to remove a reference to the cancellation of health coverage by a participant who is assigned to active military duty. This provision is no longer needed because a GBP participant may apply for, elect, or continue enrollment in optional coverage without concurrent enrollment in health coverage.

Section 81.7(h)(8)(C) is adopted to remove a reference that allowed an employee to re-enroll after the close of the annual enrollment opportunity. This provision is no longer needed due to the automation of the annual enrollment opportunity.

New §81.8(a) is adopted to establish who is eligible to waive health coverage along with the events that permit an election to waive health coverage.

New §81.8(b) is adopted to clarify that an individual who waives health coverage and later elects to apply for health coverage is subject to the applicable provisions of this chapter.

New §81.8(c) is adopted to clarify the amount of and the eligibility requirements to receive the incentive credit, and to delineate that: (1) the incentive credit may only be used for optional coverage specified by the system or the TRICARE Supplement; (2) coverage under the TRICARE Supplement ends when the participant attains age 65; however, the incentive credit will be applied toward eligible optional coverage; and (3) optional coverage is not considered voluntary coverage for the purposes of the incentive credit.

New §81.8(d) is adopted to clarify that the offering of a TRICARE Supplement is contingent upon the selection of a qualified Carrier by the ERS Board of Trustees.

Section 81.9(a) is adopted to include those enrolled in the TRICARE Supplement plan as an exempted group under the ERS grievance procedures. This section also adds the terms "carrier" and "administering firm" as entities that may formally deny an insurance claim and mail notice of the denial and right of appeal to a person. These changes are needed to update and clarify the rules with regard to grievance procedures. The section is also adopted to clarify that the grievance procedures apply to both a denial of benefits and other adverse decisions by an insurance carrier or administering firm.

Section 81.9(d) is adopted to clarify existing practice that a notice of appeal to the Board regarding a decision by the Executive Director must be in writing and filed with ERS within the specified time period.

Throughout Chapter 81, including §81.5 and §81.11, the words "legislature" and "program" have been capitalized, and the word "State" in State of Texas has been changed to lower case. These changes are needed for consistency in the rules, and these words are either proper nouns or refer to definitions. The word "title" has been changed to chapter for correct reference purposes.

No comments were received on the proposed amendments and new rule.

The amendments and new rule are adopted under Texas Insurance Code, §§1551.009, 1551.052, and 1551.221. No other statutes beyond Chapter 1551, Insurance Code, are affected by these adopted rules.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 13, 2006.

TRD-200602128

Paula A. Jones

General Counsel

Employees Retirement System of Texas

Effective date: May 3, 2006

Proposal publication date: March 10, 2006

For further information, please call: (512) 867-7421