Group, individual and conversion certificates may contain optional provisions, including, but not limited to, the following:

1. (1) Coordination of benefits. Group plans may contain a provision that the value of any benefits or services provided by the HMO may be coordinated with any other type of group insurance plan or coverage under governmental programs so no more than 100% of eligible expenses incurred is paid. The coordination of benefits provision applies to the plan when an enrollee has health care coverage under more than one plan. This provision will only apply for the duration of the enrollee's coverage in a group plan.

   1. (A) If benefits are covered by more than one plan, any plan or plans that do not have a coordination of benefits provision are primary.
   2. (B) Group plans may not coordinate benefits with any type of individual or conversion plan.
   3. (C) Requirements of the Insurance Code Article 3.51-6B and §§3.3501-3.3511 of this title (relating to Group Coordination of Benefits) relating to coordination of benefits by insurers should be followed by HMOs that include a coordination of benefits provision in their plan.
2. (2) Subrogation. A provision that the HMO receives any rights of recovery allowed by Texas law acquired by an enrollee against any person or organization for negligence or any willful act resulting in illness or injury covered by HMO benefits, but only to the extent of the cost to the HMO of providing such covered services. Upon receiving such services from the HMO, the enrollee is considered to have assigned such rights of recovery to the HMO and to have agreed to give the HMO any reasonable help required to secure the recovery. The provision may include a statement that the HMO may recover its share of attorney's fees and court costs only if the HMO aids in the collection of damages from a third party.
3. (3) Sale of substitutes to Workers' Compensation Insurance. If the HMO chooses to market a product which provides coverage for on-the-job injuries or illness, it shall comply with §5.6302 of this title (relating to Sale of Substitutes to Workers' Compensation Insurance).
4. (4) Conversion privilege. Group agreements and certificates for an HMO may, at the HMO's option, contain a conversion privilege. If the HMO elects to offer a conversion privilege, it must provide that, upon termination of coverage, each enrollee who resides, lives or works in the service area who has been covered under the group contract for a period of at least three months, or in the case of a court-ordered dependent, lives outside the service area, but within the United States, has the right to convert within 31 days to a conversion agreement without presenting evidence of insurability. If a basic service HMO does not offer each enrollee a conversion contract, the HMO shall provide written notice of the availability of coverage through the Texas Health Insurance Risk Pool. A single service or limited service HMO shall offer a conversion contract without requiring evidence of insurability. Charges for individuals must be in accordance with §11.704 of this title (relating to Charges for Individuals).
5. (5) Arbitration. A statement of any required arbitration procedure. If enrollee complaints and grievances are resolved through a specified arbitration agreement, the arbitration must be conducted pursuant to the Texas Arbitration Act, Texas Civil Practice and Remedies Code §171.001 et seq.

Source Note:The provisions of this §11.511 adopted to be effective November 2, 1998, 23 TexReg 11347.