1. (a) No later than March 1 annually, each health carrier providing health benefit plans in this state shall make a filing with the commissioner indicating whether the health carrier will or will not offer, renew, issue, or issue for delivery health benefit plans to small employers in this state as defined in the Insurance Code, Chapter 26, Subchapters A - G, and this subchapter. The required filing shall include the certification provided in the current Form Number 1212 CERT SEHC STATUS, completed according to the carrier's status and shall at least provide a statement to the effect of one of the following:

   1. (1) the health carrier intends to offer, renew, issue, and issue for delivery health benefit plans to small employers and their employees and therefore will operate in accordance with the Insurance Code, Chapter 26, Subchapters A - G and this subchapter; or
   2. (2) the health carrier does not intend to offer, issue, or issue for delivery health benefit plans to small employers and their employees; however, the health carrier intends to renew health benefit plans issued prior to July 1, 1997 and comply with the Insurance Code, Chapter 26, Subchapters A - G, and this subchapter;
   3. (3) the health carrier does not intend to offer, issue, or issue for delivery health benefit plans to small employers and their employees in the State of Texas and intends to nonrenew all health benefit plans issued to small employers in Texas and will provide notice to the commissioner and employers in accordance with §26.16 of this title (relating to Refusal to Renew and Application to Reenter Small Employer Market); or
   4. (4) The health carrier has no health benefit plans issued to small employers or to employees of a small employer which are in force on or after July 1, 1997, and the health carrier does not intend to offer, issue, or issue for delivery health benefit plans to small employers.
2. (b) If a health carrier chooses to change its election or the date of implementing its election under subsection (a)(1), (2), or (4) of this section, the health carrier shall notify the commissioner of its new election at least 30 days prior to the date the health carrier intends to begin operations under the new election. This notification shall be made on Form Number 1212 CERT SEHC STATUS.

3. (c) Upon election to become a small employer carrier, the health carrier shall establish geographic service areas within which the health carrier reasonably anticipates it will have the capacity to deliver services adequately to small employers in each established geographic service area. Small employer carriers shall comply with the following:

   1. (1) The carrier shall define geographic service areas in terms of counties or ZIP codes, to the extent possible.
   2. (2) If the service area cannot be defined by counties or ZIP code, the carrier shall submit a map which clearly shows the geographic service areas.
   3. (3) If the geographic service area of the carrier is the entire state, the carrier shall define the service area as the State of Texas and no other documentation is necessary.
   4. (4) Service areas by zip code shall be defined in a non-discriminatory manner and in compliance with the Insurance Code, Articles 21.21-6 and 21.21-8.
   5. (5) HMO small employer carriers shall establish networks in accordance with Insurance Code, Chapters 20A and 843, and Chapter 11 of this title (relating to Health Maintenance Organizations).
   6. (6) Small employer carriers shall, no later than the initial filing of a small employer health benefit plan, utilize Form Number 1212 CERT GEOG to submit this information, as required by §26.19(b) of this chapter (relating to Filing Requirements).
   7. (7) If a small employer carrier elects to alter its geographic service area, the small employer carrier shall notify the department of its intent at least 30 days prior to the date the health carrier intends to effect the change. The small employer carrier shall utilize Form Number 1212 CERT GEOG to submit this information.
4. (d) Health carriers providing coverage under any health benefit plans issued to small employers and/or their employees, whether on a group or franchise basis, shall be considered small employer carriers for purposes of such plans, and shall comply with all provisions of Insurance Code, Chapter 26, Subchapters A - G, and this subchapter, as applicable.
5. (e) A health carrier that continues to provide coverage pursuant to subsection (a)(2) of this section shall not be eligible to participate in the reinsurance program established under Insurance Code, Chapter 26, Subchapter F.
6. (f) This subsection does not exempt a health carrier from any other applicable legal requirements, such as those for withdrawal from the market under §§7.1801, et seq. of this title (relating to Withdrawal Plan Requirements and Procedures).

Source Note:The provisions of this §26.6 adopted to be effective December 30, 1993, 18 TexReg 9375; amended to be effective April 9, 1996, 21 TexReg 2648; amended to be effective March 5, 1998, 23 TexReg 2297; amended to be effective April 6, 2005, 30 TexReg 1931.