SB1409

The sponsor must be an institution within the Education Code’s public higher-education or qualifying private/independent institution definitions. Benefits may be offered only to its enrolled students and their family members; the institution may not force a student to enroll in these benefits. A private college must meet the referenced statutory definition, not simply call itself a school. Final law, section 1683.001–.002; Institution definitions.

For a preexisting condition that the benefits otherwise cover, a waiting period for treatment may not exceed six months. This is not a requirement that every preexisting condition or every service be covered, nor a promise of immediate coverage. Before enrollment, applicants must receive, sign and return a written notice explaining that the benefits are not provided through a product regulated as insurance in Texas. The institution must keep that signed notice throughout the benefits term and provide a copy on request. Final law, sections 1683.003–.004.

An institution acting in accordance with the new chapter is not treated as a health insurer for offering these benefits. It must register with the Texas Department of Insurance and supply information needed for the applicable out-of-network dispute process. The act brings the plans within Chapter 1275, including its specified payment and balance-billing protections and Chapter 1467 dispute-resolution framework. For example, the existing rules limit what an enrollee can be billed for covered emergency care and certain covered out-of-network services connected with participating providers; eligibility conditions and exceptions still matter. This is not a ban on every out-of-network charge or all patient cost-sharing. Final law; Dispute-resolution cross-reference; Covered emergency care; Facility-based provider limits; Lab and imaging limits.

The institution may transfer risk or insure its obligations through a company authorized to conduct insurance business in Texas that is not under common control with it. Separately, it must obtain an opinion from an actuary who is a fellow of the Society of Actuaries or a member of the American Academy of Actuaries and maintain the cash reserves and specific and aggregate stop-loss insurance levels that opinion recommends. Stop-loss insurance protects against unusually large individual claims or total claims; it is not a guarantee that every student’s medical expense is covered. Final law, sections 1683.006–.007.

The Senate substitute removed institutional affiliates as separate authorized sponsors, expressly prohibited mandatory student enrollment, and added the actuarial opinion and reserve/stop-loss requirements. It also reorganized the definitions under “postsecondary educational institution,” retaining the referenced public and qualifying private institutions. The Senate-passed, House committee and enrolled operative texts match the substitute. No floor amendments are listed. Introduced text; Senate substitute; Senate-passed; House committee; Final law; Version index; Amendment index.

Compare the published text versions in the official text index. A change is not attributed to a specific amendment here without a verified record.

Students and families may gain another benefit option if their institution offers one, while institutions take on disclosure, registration and financial-risk obligations. The noninsurance status and possible waiting period make the actual benefit terms important: the act does not guarantee lower prices, an available campus program, comprehensive coverage or payment of every claim. It also does not require every institution to offer a program. Final law.

The April 9 substitute fiscal note anticipates no significant fiscal impact on the state or local governments and assumes costs can be absorbed within existing resources. The April 2 introduced note reaches the same conclusion. Those estimates do not quantify student savings, the price of a particular program, or future claims losses. The act makes no appropriation. Substitute fiscal note; Introduced fiscal note.