Texas Senate Bill 51

Under the new Texas Senate Bill 51 legislation, group policyholders are liable for an enrollee's or insured's premium payments, from the time the enrollee or insured ceases to be eligible for coverage, until the end of the month in which the group policyholder notifies the HMO or insurer, that the enrollee or insured is no longer part of the group and eligible for coverage. The group policyholder is required to provide coverage for the enrollee or insured, under the policy, until the end of the month in which notification is received by the benefit plan, carrier, or insurer.

Essentially, insurance carriers located in Texas will no longer be able to process retro-termination and retro-cancellation requests due to this bill. Coverage must continue through the end of the month in which the cancellation was sent to the benefit plan.

Example Scenario

An enrollee/insured terms employment with the Group Policyholder on August 20, 2017. The Group Policyholder notifies the carrier on September 6, 2017. Under the new Senate Bill 51 requirements, the Group Policyholder is responsible for premium payment for the entire month of September 2017, in which the Group Policyholder notified the carrier.

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