Proposed: Texas Medical Reinsurance System

               A Bill introduced in the Texas House, HB 2165 establishes the Texas Medical Reinsurance System that will assist self-funded employer sponsored health plans in the purchase of competitive stop loss cover.

Health insurance stop loss cover is essentially a twelve month contract, with the right of the carrier to re-evaluate the risk upon renewal. Large potential claims identified as possible risks to be paid in the succeeding Plan year may be passed on to the Plan Sponsor in whole or in part, thereby limiting competition for the Plan Sponsor seeking competitive stop loss cover.

The Texas Medical Reinsurance System would provide protection in such events by offering aggregate stop loss cover to insure claims exceeding a specified dollar amount or a percentage of expected claims. A two year extention of coverage for two succeeding policy years plus portability would move to any new carrier should one replace the previous carrier.

See details here –

Section 1676.004, Repricing Schedule, (B) (1) & (2) provides for the basis of medical care reimbursement. Physicians to receive 110% RBRVS and facilities (hospitals, out-patient surgical centers, etc) to receive 140% RBRVS.

Editor’s Note: While the concept is a good one, and will fix an inherent problem associated with a self-funded employee welfare plan, we think the private sector is better equiped to facilitate the scheme rather than a single payer reinsurance system as proposed by HB 2165.