1. (a) Full-time employees and their dependents.

   1. (1) A new employee:

      1. (A) who is not subject to the health insurance waiting period and is eligible under the Act and as provided for in §81.5(a) of this chapter (relating to Eligibility) for automatic insurance coverage, shall be enrolled in the basic plan of health and life insurance unless the employee completes an enrollment form to elect other coverages or to waive health coverage as provided in §81.8 of this chapter (relating to Waiver of Health Coverage). Coverage of an employee under the basic plan, and other coverages selected as provided in this paragraph, become effective on the date on which the employee begins active duty.
      2. (B) who is subject to the health insurance waiting period and is eligible under the Act and as provided for in §81.5(a) of this chapter for automatic insurance coverage, shall be enrolled in the basic plan of health and life insurance beginning on the first day of the calendar month following 90 days of employment unless, before this date, the employee completes an enrollment form to elect other coverages or to waive health coverage as provided in §81.8 of this chapter.
   2. (2) A new employee with existing, current, and continuous GBP health coverage as of the date the employee begins active duty is not subject to the health insurance waiting period established in §1551.1055, Insurance Code, and is eligible to enroll as a new employee in health insurance and additional coverages and plans which include optional and voluntary coverages by completing an enrollment form before the first day of the calendar month after the date the employee begins active duty. Health and additional coverages selected before the first day of the calendar month after the date the employee begins active duty are effective the first day of the following month.

   3. (3) Dependent enrollment and optional coverages:

      1. (A) To enroll eligible dependents, to elect to enroll in an approved HMO, and to elect additional coverages and plans which include optional and voluntary coverages, an employee not subject to the health insurance waiting period shall complete an enrollment form within 30 days after the date on which the employee begins active duty. Coverages selected within 30 days after the date on which the employee begins active duty become effective on the first day of the month following the date on which the enrollment form is completed. An enrollment form completed after the initial period for enrollment as provided in this paragraph is subject to the provisions of subsection (h) of this section.
      2. (B) To enroll eligible dependents or to elect to enroll in an approved HMO, an employee subject to the health insurance waiting period shall complete an enrollment form before the first day of the month following 90 days of employment. Coverages selected before the first day of the month following 90 days of employment become effective on the first day of the month following 90 days of employment. An employee completing an enrollment form after the initial period for enrollment as provided in this paragraph is subject to the provisions of subsection (h) of this section. The provisions of paragraph (2) of this subsection apply to the election of additional coverages and plans, which include optional and voluntary coverages, for an employee subject to the health insurance waiting period.
   4. (4) Except as otherwise provided in this section, an employee may not change coverage during a contract year.
   5. (5) An eligible employee who enrolls in the Program is eligible to participate in premium conversion and shall be automatically enrolled in the premium conversion plan. The employee shall be automatically enrolled in the plan for subsequent plan years as long as the employee remains on active duty.
   6. (6) Coverage for a newly eligible dependent, other than a dependent referred to in paragraph (7) or (9) of this subsection, will be effective on the first day of the month following the date the person becomes a dependent if an enrollment form is completed on or within 30 days after the date the person first becomes a dependent. If the enrollment form is completed and signed after the initial period for enrollment as provided in this paragraph, the enrollment form will be governed by the rules in subsection (h) of this section.
   7. (7) A newborn natural child will be covered immediately and automatically from the date of birth in the health plan in effect for the employee or retiree. A newly adopted child will be covered immediately and automatically from the date of placement for adoption in the health plan in effect for the employee or retiree. To continue coverage for more than 30 days after the date of birth or placement for adoption, an enrollment form for health coverage must be submitted within 30 days after the date of birth or placement for adoption.
   8. (8) The effective date of a newborn natural child's life and AD&D insurance will be the date of birth, if the child is born alive, as certified by an attending physician. The effective date of a newly adopted child's life and AD&D insurance will be the date of placement for adoption. The effective date of all other eligible dependents' life and AD&D insurance coverages will be as stated in paragraph (6) of this subsection.
   9. (9) Health insurance coverage of an eligible child for whom a covered employee or retiree is court-ordered to provide medical support becomes effective on the date on which the department receives a valid copy of the court order.
   10. (10) The effective date of HealthSelect of Texas coverage for an employee's or retiree's dependent, other than a newborn natural child or newly adopted child, will be as stated in paragraph (6) of this subsection.
   11. (11) For purposes of this section, an enrollment form is completed when all information necessary to effect an enrollment has been transmitted to the system in the form and manner prescribed by the system.

2. (b) Part-time employees. A part-time employee or other employee who is not automatically covered must complete an application/enrollment form provided by the Employees Retirement System of Texas, authorizing necessary deductions for premium payments for elected coverage. All other rules for enrollment stated in subsection (a) of this section, other than the rule as to automatic coverage, apply to such employee:

   1. (1) If the employee is not subject to a health insurance waiting period, this form must be submitted to the Employees Retirement System of Texas through his or her employing department on, or within 30 days after, the date on which the employee begins active duty.
   2. (2) If the employee is subject to a health insurance waiting period, this form must be submitted to the Employees Retirement System of Texas through his or her employing department before the first day of the month following 90 days of employment.
   3. (3) If the employee has existing, current, and continuous GBP health coverage as of the date the employee begins active duty, the employee is not subject to the health insurance waiting period established in §1551.1055, Insurance Code, and is eligible to enroll as a new employee in health insurance and additional coverages and plans which include optional and voluntary coverages by completing an enrollment form before the first day of the calendar month after the date the employee begins active duty. Health and additional coverages selected before the first day of the calendar month after the date the employee begins active duty are effective the first day of the following month.

3. (c) Retirees and their dependents.

   1. (1) Provided the required premiums are paid or deducted, an employee's health, dental and term life insurance coverage (including eligible dependent coverages) may be continued upon retirement as provided in §81.5(c) of this chapter. The life insurance will be reduced to the maximum amount which the retiree is permitted to retain under the insurance contract as a retiree. All other coverages in force for the active employee, but not available to a retiree, will automatically be discontinued concurrently with the commencement of retirement status. If a retiree retires directly from department service and is not covered as an active employee on the day before becoming an annuitant, the retiree will be enrolled in the basic plan.

   2. (2) A retiree may enroll in health, dental, and life insurance coverages for which the retiree is eligible as provided in §81.5(c) of this chapter, including dependent coverages, by completing an enrollment form as specified in subparagraphs (A) - (C) of this paragraph. For the purposes of this paragraph, the effective date of retirement of a retiree who is eligible to receive, but who is not actually receiving, an annuity is the date on which the system receives written notice of the retirement. An application/enrollment form received after the initial period for enrollment as provided in this paragraph is subject to the provisions of subsection (h) of this section.

      1. (A) A retiree who is not subject to the health insurance waiting period on the effective date of retirement as provided in §81.5(c) of this chapter, may enroll in health, dental, and life insurance coverages or waive health coverage as provided in §81.8 of this chapter for which the retiree is eligible, including dependent coverage, by completing an enrollment form or waiver of coverage as applicable before, on, or within 30 days after, the retiree's effective date of retirement.
      2. (B) A retiree who is subject to the health insurance waiting period on the effective date of retirement as provided in §81.5(c) of this chapter, may enroll in health coverage or waive health coverage as provided in §81.8 of this chapter for which the retiree is eligible, including dependent coverage, by completing an enrollment form or waiver of coverage as applicable, before the first day of the calendar month following 90 days after the date of retirement or before the first day of the calendar month after the retiree's 65th birthday, whichever is later as appropriate. The effective date for such coverages shall be the first day of the calendar month following 90 days after the date of retirement or the first day of the calendar month following the retiree's 65th birthday, whichever is later as appropriate.
      3. (C) A retiree who is ineligible for health insurance on the effective date of retirement as provided in §81.5(c) of this chapter, may enroll in health coverage or waive health coverage as provided in §81.8 of this chapter for which the retiree is eligible, including dependent coverage, by completing an enrollment form or waiver of coverage as applicable, before the first day of the calendar month after the retiree's 65th birthday. The effective date for such coverages shall be the first day of the calendar month following 90 days after the date of retirement or the first day of the calendar month following the retiree's 65th birthday, whichever is later.
   3. (3) A retiree who becomes eligible for minimum retiree optional life insurance coverage or dependent life insurance coverage as provided in §81.5(c)(5) of this chapter, may apply for approval of such coverage by providing evidence of insurability acceptable to the system.
   4. (4) Enrollments and applications to change coverage become effective as provided in paragraph (2) of this subsection unless other coverages are in effect at that time. If other coverages are in effect at that time, coverage or waiver of coverage becomes effective on the first day of the month following the date of approval of retirement by the Employees Retirement System of Texas; or, if cancellation of the other coverages preceded the date of approval of retirement, the first day of the month following the date the other coverages were canceled.
   5. (5) All other enrollment rules stated in subsections (a), (g), and (l) of this section apply to retirees.

4. (d) Surviving dependents.

   1. (1) Provided that the required premiums are paid or deducted, the health and dental insurance coverages of a surviving dependent may be continued on the death of the deceased employee or retiree if the dependent is eligible for such coverage as provided by §81.5(f) of this chapter.
   2. (2) A surviving spouse who is receiving an annuity shall make premium payments by deductions from the annuity as provided in §81.3(b)(2)(A) of this chapter (relating to Administration). A surviving spouse who is not receiving an annuity may make payments as provided in §81.3(b)(2)(B) of this chapter.
5. (e) Former COBRA unmarried children. A former COBRA unmarried child must provide an application to continue health and dental insurance coverage within 30 days after the date the notice of eligibility is mailed by the system. Coverage becomes effective on the first day of the month following the month in which continuation coverage ends. Premium payments may be made as provided in §81.3(b)(2)(B) of this chapter.

6. (f) Premium conversion plans.

   1. (1) An eligible employee participating in the Program is deemed to have elected to participate in the premium conversion plan and to pay insurance premium expenses with pre-tax dollars as long as the employee remains on active duty. The plan is intended to be qualified under the Internal Revenue Code, §79 and §106.
   2. (2) Maximum benefit available. Subject to the limitations set forth in these rules and in the plan, to avoid discrimination, the maximum amount of flexible benefit dollars which a participant may receive in any plan year for insurance premium expenses under this section shall be the amount required to pay the participant's portion of the premiums for coverage under each type of insurance included in the plan.

7. (g) Special rules for additional coverages and plans which include optional and voluntary coverages.

   1. (1) Only an employee or retiree or a former officer or employee specifically authorized to join the Program may apply for additional coverages and plans. An employee/retiree may apply for or elect additional coverages and plans without concurrent enrollment in health coverage provided by the Program. Additional coverages and plans, as determined by the board, may include:

      1. (A) dental coverage;
      2. (B) optional term life;
      3. (C) dependent term life;
      4. (D) short and long-term disability;
      5. (E) voluntary accidental death and dismemberment;
      6. (F) long-term care; or
      7. (G) health care and dependent care reimbursement.
   2. (2) An eligible participant in the Program and eligible dependents may participate in an approved HMO if they reside in the approved service area of the HMO and are otherwise eligible under the terms of the contract with the HMO.
   3. (3) An eligible participant in the Program electing additional coverages and plans and/or HMO or coverage in lieu of the basic plan of insurance is obligated for the full payment of premiums. If the premiums are not paid, all coverages not fully funded by the state contribution will be canceled. A person entitled to the state contribution will retain member only health coverage provided the state contribution is sufficient to cover the premium for such coverage. If the state contribution is not sufficient for member only coverage in the health plan selected by the employee or retiree, the employee or retiree will be enrolled in the basic plan except as provided for in subsection (l)(2)(B) of this section.

   4. (4) An eligible participant in the Program enrolled in an HMO whose contract is not renewed for the next fiscal year will be eligible to make one of the following elections:

      1. (A) change to another approved HMO for which the participant is eligible by completing an enrollment form during the annual enrollment period. The effective date of the change in coverage will be September 1;
      2. (B) enroll in HealthSelect of Texas without evidence of insurability by completing an enrollment form during the annual enrollment period, if the participant is eligible to enroll in another approved HMO. The effective date of the change in coverage for the eligible participant shall be September 1. Eligible dependents shall be subject to evidence of insurability requirements. The effective date of coverage for dependents may be either September 1 or the first day of the month following the date approval is received by the department;
      3. (C) enroll in HealthSelect of Texas without evidence of insurability by completing an enrollment form during the annual enrollment period, if the participant is not eligible to enroll in another approved HMO (an approved HMO is not available to the participant). Eligible dependents shall not be subject to evidence of insurability requirements. The effective date of the change in coverage will be September 1; or
      4. (D) if the participant does not make one of the elections, as defined in subparagraphs (A) - (C) of this paragraph, the participant will automatically be enrolled in the basic plan. Evidence of insurability for the participant and the participant's dependents will apply as referenced in subparagraph (B) of this paragraph.

   5. (5) An employee, retiree, or other eligible program participant enrolled in an HMO whose contract is terminated during the fiscal year or which fails to maintain compliance with the terms of its contract with the Employees Retirement System of Texas will be eligible to make one of the following elections:

      1. (A) change to another approved HMO for which the participant is eligible. The effective date of the change in coverage will be determined by the board;
      2. (B) enroll in HealthSelect of Texas without evidence of insurability provided the participant is not eligible to enroll in another approved HMO. The effective date of the change in coverage will be determined by the board; or
      3. (C) if a participant is eligible to enroll in another HMO, the board may allow the participant to enroll in HealthSelect of Texas without evidence of insurability. The effective date of the change in coverage will be determined by the board.

8. (h) Changes in coverage after the initial period for enrollment.

   1. (1) Changes for Qualifying Life Event.

      1. (A) Subject to the provisions of paragraphs (3) and (4) of this subsection, a participant shall be allowed to change coverage during a plan year if a qualifying life event occurs as provided in this paragraph and the change in coverage is consistent with the qualifying life event.

      2. (B) A qualifying life event occurs when a participant experiences one of the following changes:

         1. (i) change in marital status;
         2. (ii) change in dependent status;
         3. (iii) change in employment status;
         4. (iv) change of address that results in loss of benefits eligibility;
         5. (v) change in Medicare or Medicaid status, or Children's Health Insurance program (CHIP) status;
         6. (vi) significant cost of benefit or coverage change imposed by a third party provider; or
         7. (vii) change in coverage ordered by a court.
      3. (C) A participant who loses benefits eligibility as a result of a change of address shall change coverage as provided in paragraphs (6) - (9) of this subsection.
      4. (D) A participant may apply to change coverage on, or within 30 days after, the date of the qualifying life event, provided, however, a change in election due to CHIP status under subparagraph (B) of this paragraph may be submitted on, or within 60 days after, the change in CHIP status.
      5. (E) Except as otherwise provided in subsection (a)(7) and (9) of this section, the change in coverage is effective on the first day of the month following the date on which the enrollment form is completed.
      6. (F) The plan administrator may require documentation in support of the qualifying life event.
   2. (2) Effects of change in cost of benefits to the premium conversion plan. There shall be an automatic adjustment in the amount of premium conversion plan dollars used to purchase optional benefits in the event of a change, for whatever reason, during an applicable period of coverage, of the cost of providing such optional benefit to the extent permitted by applicable law and regulation. The automatic adjustment shall be equal to the increase or decrease in such cost. A participant shall be deemed by virtue of participation in the plan to have consented to the automatic adjustment.
   3. (3) An eligible participant who wishes to add or increase coverage, add eligible dependents to HealthSelect of Texas, or change coverage from an HMO to HealthSelect of Texas after the initial period for enrollment must make application for approval by providing evidence of insurability acceptable to the system. Unless not in compliance with paragraph (1) of this subsection, coverage will become effective on the first day of the month following the date approval is received by the employee's benefits coordinator or by the system, if the applicant is a retiree or an individual in a direct pay status. If the applicant is an employee whose coverage was canceled while the employee was in a leave without pay status, the approved change in coverage will become effective on the date the employee returns to active duty if the employee returns to active duty within 30 days of the approval letter. If the date the employee returns to active duty is more than 30 days after the date on the approval letter, the approval is null and void; and a new application shall be required. An employee or retiree may withdraw the application at any time prior to the effective date of coverage by submitting a written notice of withdrawal.

   4. (4) The evidence of insurability provision applies only to:

      1. (A) employees who wish to enroll in Elections III or IV optional term life insurance, except as otherwise provided in subsection (k) of this section;
      2. (B) employees who wish to enroll in or increase optional term life insurance or disability income insurance after the initial period for enrollment;
      3. (C) employees, retirees, or eligible dependents who wish to enroll in HealthSelect of Texas after the initial period for enrollment, except as provided in subsections (a), (g)(4) - (5), and (h)(6) - (9) of this section and §81.3(b)(3)(B) of this chapter;
      4. (D) employees enrolled in the Program whose coverage was waived, dropped or canceled, except as otherwise provided in subsection (k) of this section; and
      5. (E) retirees who wish to enroll in minimum optional life insurance coverage or dependent life insurance coverage as provided in subsection (c)(3) of this section.

   5. (5) An employee or retiree who wishes to add eligible dependents to the employee's or retiree's HMO coverage may do so:

      1. (A) during the annual enrollment period (coverage will become effective on September 1); or
      2. (B) upon the occurrence of a qualifying life event as provided in paragraph (1) of this subsection.

   6. (6) A participant who is enrolled in an approved HMO and who permanently moves out of the HMO service area shall make one of the following elections, to become effective on the first day of the month following the date on which the participant moves out of the HMO service area:

      1. (A) enroll in another approved HMO for which the participant and all covered dependents are eligible; or

      2. (B) if the participant and all covered dependents are not eligible to enroll in an approved HMO; either:

         1. (i) enroll in HealthSelect of Texas without providing evidence of insurability; or
         2. (ii) enroll in an approved HMO if the participant is eligible, and drop any ineligible covered dependent, unless not in compliance with §81.11(a)(2) of this chapter (relating to Termination of Coverage).

   7. (7) When a covered dependent of a participant permanently moves out of the participant's HMO service area, the participant shall make one of the following elections, to become effective on the first day of the month following the date on which the dependent moves out of the HMO service area:

      1. (A) drop the ineligible dependent, unless not in compliance with §81.11(a)(2) of this chapter;
      2. (B) enroll in an approved HMO if the participant and all covered dependents are eligible; or
      3. (C) enroll in HealthSelect of Texas without providing evidence of insurability if the participant and all covered dependents are not eligible to enroll in an approved HMO.

   8. (8) An eligible participant will be allowed an annual opportunity to make changes in coverages.

      1. (A) A participant will be allowed to:

         1. (i) change from one HMO to another HMO;
         2. (ii) change from HealthSelect of Texas to an HMO;
         3. (iii) apply for coverage in HealthSelect, if eligible, subject to approval of evidence of insurability;
         4. (iv) select in-area or out-of-area coverage in HealthSelect of Texas based on an out-of-area residential zip code and an in-area work zip code;
         5. (v) enroll in a dental plan;
         6. (vi) change dental plans;
         7. (vii) enroll eligible dependents in an HMO or dental coverage;
         8. (viii) enroll eligible dependents in HealthSelect of Texas, without evidence of insurability, if the participant is enrolled in HealthSelect of Texas and does not reside in any HMO service area;
         9. (ix) enroll themselves and their eligible dependents in an eligible HMO and in a dental plan from a waived or canceled status;
         10. (x) add, decrease or cancel eligible coverage, unless prohibited by §81.11(a)(2) of this chapter;
         11. (xi) apply for coverage for which evidence of insurability is required as provided in paragraph (3) of this subsection; and
         12. (xii) waive health coverage as provided in §81.8 of this chapter.
      2. (B) Surviving dependents and former COBRA unmarried children are not eligible for the provisions in subparagraph (A)(iv), (vii), (viii), (ix), or (xii) of this paragraph, except that a surviving dependent or former COBRA unmarried child may enroll an eligible dependent in dental insurance coverage if the dependent is enrolled in health insurance coverage.
      3. (C) Such opportunity will be scheduled prior to September 1 of each year at times announced by the system. Coverage selected during the annual enrollment period will be effective September 1.
   9. (9) A participant who is a retiree or a surviving dependent, or who is in a direct pay status, may decrease or cancel any coverage at any time unless such coverage is health insurance coverage ordered by a court as provided in §81.5(d) of this chapter.
9. (i) Preexisting conditions exclusion. The preexisting conditions exclusion shall apply to employees who enroll in disability coverage. The exclusion for benefit payments shall not apply after the first six consecutive months that the employee has been actively at work or after the employee's disability coverage has been continuously in force for 12 months for a preexisting condition, as defined in §81.1 of this chapter (relating to Definitions). The preexisting conditions exclusion will not apply to a medical condition resulting from congenital or birth defects.

10. (j) Special provisions relating to term life benefits

    1. (1) An employee or annuitant who is enrolled in the group term life insurance plan may file a claim for an accelerated life benefit for himself or his covered dependent in accordance with the terms of the plan in effect at that time. An accelerated life benefit paid will be deducted from the amount that would otherwise be payable under the plan.
    2. (2) An employee or annuitant who is enrolled in the group term life insurance plan may make, in conjunction with receipt of a viatical settlement, an irrevocable beneficiary designation in accordance with the terms of the plan in effect at that time.

11. (k) Re-enrollment in the Program.

    1. (1) The provisions of subsection (a) of this section shall apply to the enrollment of an employee who terminates employment and returns to active duty within the same contract year, who transfers from one department to another, or who returns to active duty after a period of leave without pay during which coverage is canceled.
    2. (2) An employee to whom paragraph (1) of this subsection applies shall be subject to the same requirements as a newly hired employee to re-enroll in the coverages in which the employee was previously enrolled. Provided that all applicable preexisting conditions exclusions were satisfied on the date of termination, transfer, or cancellation, no new preexisting conditions exclusions will apply. If not, any remaining period of preexisting conditions exclusions must be satisfied upon re-enrollment.
    3. (3) If an employee is a member of the Texas National Guard or any of the reserve components of the United States armed forces, and the employee's coverages are canceled during a period of leave without pay or upon termination of employment as the result of an assignment to active military duty, the period of active military duty shall be applied toward satisfaction of any period of preexisting conditions exclusions remaining upon the employee's return to active employment.

12. (l) Continuing coverage in special circumstances.

    1. (1) Continuation of coverages for terminating employees. A terminating employee is eligible to continue all coverages through the last day of the month in which employment is terminated.

    2. (2) Continuation of coverages for employees in a leave without pay status.

       1. (A) An employee in a leave without pay status may continue the coverages in effect on the date the employee entered that status for the period of leave, but not more than 12 months. The employee must pay premiums directly as provided in §81.3(b)(2)(B)(i) of this chapter.
       2. (B) An employee whose leave without pay is a result of the Family and Medical Leave Act of 1993 will continue to receive the state contribution during such period of leave without pay. The employee must pay premiums directly as defined in §81.3(b)(2)(B)(i) of this chapter. Failure to make the required payment of premiums by the due date will result in the cancellation of all coverages except for member only health and basic life coverage. The employee will continue in the health plan in which he or she was enrolled immediately prior to the cancellation of all other coverages. If a premium beyond the state contribution for member only health and basic life coverage is owed, the employee must make the required payment of premiums directly to the employing department upon return to active duty.
    3. (3) Continuation of coverages for a former member or employee of the Legislature. Provided that the required premiums are paid, the health, dental, and life insurance coverages of a former member or employee of the Legislature may be continued on conclusion of the term of office or employment.
    4. (4) Continuation of coverages for a former judge. A former state of Texas judge, who is eligible for judicial assignments and who does not serve on judicial assignments during a period of one calendar month or longer, may continue the coverages that were in effect during the calendar month immediately prior to the month in which the former judge did not serve on judicial assignments. These coverages may continue for no more than 12 continuous months during which the former judge does not serve on judicial assignments as long as, during the period, the former judge continues to be eligible for assignment.
    5. (5) Continuation of health and dental coverage for a surviving spouse and/or dependent child/children of a deceased employee or retiree. The surviving spouse and/or dependent child/children of a deceased employee/retiree, who, in accordance with §81.5(k)(1) of this chapter, elects to continue coverage may do so by submitting the required election notification and enrollment forms to the system. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the system on or before the date indicated on the continuation of coverage enrollment form. Continuing coverage will begin on the first day of the month following the month in which the employee/retiree dies, provided all group insurance premiums due for the month in which the employee/retiree died and for the election/enrollment period have been paid in full.
    6. (6) Continuation of health and dental coverage for a covered employee whose employment has been terminated, voluntarily or involuntarily (other than for gross misconduct), whose work hours have been reduced such that the employee is no longer eligible for the Program as an employee, or whose coverage has ended following the maximum period of leave without pay as provided in paragraph (2)(A) of this subsection. An employee, his or her spouse and/or dependent child/children, who, in accordance with §81.5(k)(2) of this chapter, elects to continue health and dental coverages may do so by submitting the required election notification and enrollment forms to the system. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the system on or before the date indicated on the continuation of coverage enrollment form. Continuing coverage will begin on the first day of the month following the month in which the employee's coverage ends, provided all group insurance premiums due for the month in which the coverage ends and for the election/enrollment period have been paid in full.
    7. (7) Continuation of health and dental coverage for a spouse who is divorced from an employee/retiree and/or the spouse's dependent child/children. The divorced spouse and/or the spouse's dependent child/children (not provided for by §81.5(a) of this chapter) of an employee/retiree who, in accordance with §81.5(k)(4) of this chapter, elects to continue coverage may do so by submitting the required election notification and enrollment forms to the system. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the system on or before the date indicated on the continuation of coverage enrollment form. Continuing coverage will begin on the first day of the month following the month in which the divorce decree is signed, provided all group insurance premiums due for the month in which the divorce decree is signed and for the election/enrollment period have been paid in full.
    8. (8) Continuation of health and dental coverage for a dependent child under 25 years of age who marries. A dependent child under 25 years of age who marries and who, in accordance with §81.5(k)(5) of this chapter, elects to continue coverage may do so by submitting the required election notification and enrollment forms to the system. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the system on or before the date indicated on the continuation of coverage enrollment form. Continuing coverage will begin on the first day of the month following the month in which the dependent child's marriage occurred, provided all group insurance premiums due for the month in which the dependent child's marriage occurred and for the election/enrollment period have been paid in full.
    9. (9) Continuation of health and dental coverage for a dependent child who has attained 25 years of age. A 25-year-old dependent child (not provided for by §81.5(d) of this chapter of an employee/retiree who, in accordance with §81.5(k)(6) of this chapter, elects to continue coverage may do so by submitting the required election notification and enrollment forms to the system. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the system on or before the date indicated on the continuation of coverage enrollment form. Continuing coverage will begin on the first day of the month following the month in which the dependent child of the employee/retiree attains 25 years of age, provided all group insurance premiums due for the month in which the dependent child attained age 25 and for the election/enrollment period have been paid in full.

    10. (10) Extension of continuation of health and dental coverages for certain spouses and/or dependent child/children of former employees who are continuing coverage under the provisions of paragraph (6) of this subsection.

        1. (A) The surviving spouse and/or dependent child/children of a deceased former employee, who, in accordance with §81.5(k)(7)(A) of this chapter, elects to extend continuation coverage may do so by submitting the required election notification and enrollment forms to the Employees Retirement System of Texas. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the Employees Retirement System of Texas on or before the date indicated on the continuation enrollment form. The election/enrollment period begins on the first day of the month following the month in which the former employee died.
        2. (B) A spouse who is divorced from a former employee and/or the divorced spouse's dependent child/children, who, in accordance with §81.5(k)(7)(B) of this chapter, elects to extend continuation coverage may do so by submitting the required election notification and enrollment forms to the Employees Retirement System of Texas. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the Employees Retirement System of Texas on or before the date indicated on the continuation enrollment form. The election/enrollment period begins on the first day of the month following the month in which the divorce decree was signed.
        3. (C) A dependent child under 25 years of age who marries, who, in accordance with §81.5(k)(7)(C) of this chapter, elects to extend continuation coverage may do so by submitting the required election notification and enrollment forms to the Employees Retirement System of Texas. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the Employees Retirement System of Texas on or before the date indicated on the continuation enrollment form. The election/enrollment period begins on the first day of the month following the month in which the dependent child marries.
        4. (D) A dependent child who has attained 25 years of age, who, in accordance with §81.5(k)(7)(D) of this chapter, elects to extend continuation coverage may do so by submitting the required election notification and enrollment forms to the Employees Retirement System of Texas. The enrollment form, including all premiums due for the election/enrollment period, must be postmarked or received by the Employees Retirement System of Texas on or before the date indicated on the continuation enrollment form. The election/enrollment period begins on the first day of the month following the month in which the dependent child attained age 25.

    11. (11) Continuation coverage defined. Continuation coverage as provided for in paragraphs (5) - (10) of this subsection means the continuation of only health and dental coverage benefits which meet the following requirements.

        1. (A) Type of benefit coverage. The coverage shall consist of only the health and dental coverages, which, as of the time the coverage is being provided, are identical to the health and dental coverages provided for a similarly situated person for whom a cessation of coverage event has not occurred.

        2. (B) Period of coverage. The coverage shall extend for at least the period beginning on the first day of the month following the date of the cessation of coverage event and ending not earlier than the earliest of the following:

           1. (i) in the case of loss of coverage due to termination of an employee's employment, reduction in work hours, or end of maximum period of leave without pay, the last day of the 18th calendar month of the continuation period;
           2. (ii) in the case of loss of coverage due to termination of an employee's employment, reduction in work hours, or end of maximum period of leave without pay, if the employee, spouse, or dependent child has been certified by the Social Security Administration as being disabled as provided in §81.5(k)(3) of this chapter, the last day of the 29th calendar month of the continuation period;
           3. (iii) in any case other than loss of coverage due to termination of an employee's employment, reduction in work hours, or end of maximum period of leave without pay, the last day of the 36th calendar month of the continuation period;
           4. (iv) the date on which the employer ceases to provide any group health plan to any employee/retiree;
           5. (v) the date on which coverage ceases under the plan due to failure to make timely payment of any premium required as provided in §81.3(b)(2)(B)(ii) and (iii) of this chapter;
           6. (vi) the date on which the participant, after the date of election, becomes covered under any other group health plan under which the participant is not subject to a preexisting conditions limitation or exclusion;
           7. (vii) the date on which the participant, covered under any other group health plan that subjects him or her to a preexisting conditions limitation or exclusion that was not satisfied by the service credit provisions of Public Law 104-91 (HIPAA), is no longer subject to the preexisting conditions limitation or exclusion in the other plan;
           8. (viii) the date on which the participant, after the date of election, becomes entitled to benefits under the Social Security Act, Title XVIII.

        3. (C) Premium requirements. The premium for a participant during the continuation coverage period will be 102% of the employee's/retiree's health and dental coverages only rate and is payable as provided in §81.3(b)(2)(B)(ii) of this chapter.

           1. (i) The premium for a participant eligible for 36 months of coverage will be 102% of the employee's/retiree's health and dental coverages only rate for the 19th through 36th months of coverage and is payable as provided in §81.3(b)(2)(B)(ii) of this chapter.
           2. (ii) The premium for a participant eligible for 29 months of coverage will be 150% of the employee's/retiree's health and dental coverages only rate for the 19th through 29th months of coverage and is payable as provided in §81.3(b)(2)(B)(iii) of this chapter.
        4. (D) No requirement of insurability. No evidence of insurability is required for a participant who elects to continue coverage under the provisions of §81.5(k)(1) - (6) of this chapter.
        5. (E) Conversion option. An option to enroll under the conversion plan available to employees/retirees is also available to a participant who continues health and dental coverages for the maximum period as provided in subparagraph (B)(i) - (iii) of this paragraph. The conversion notice will be provided to a participant during the 180-day period immediately preceding the end of the continuation period.
    12. (12) Continuation coverage for a former board member. Provided that the required premiums are paid, the health, dental, and life insurance coverages of a former member of a board or commission, or of the governing body of an institution of higher education, as both are described in §1551.109, Insurance Code, may be continued on conclusion of service if no lapse in coverage occurs after the term of office. Life insurance will be reduced to the maximum amount for which the former member is eligible.

Source Note:The provisions of this §81.7 adopted to be effective September 1, 1985, 10 TexReg 2321; amended to be effective November 1, 1985, 10 TexReg 3850; amended to be effective September 1, 1986, 11 TexReg 3864; amended to be effective October 14, 1986, 11 TexReg 4115; amended to be effective October 28, 1986, 11 TexReg 4576; amended to be effective December 19, 1986, 11 TexReg 5138; amended to be effective January 9, 1987, 11 TexReg 5136; amended to be effective November 1, 1987, 12 TexReg 3480; amended to be effective December 13, 1988, 13 TexReg 5973; amended to be effective March 28, 1989, 14 TexReg 1371; amended to be effective August 24, 1989, 14TexReg3988;amendedtobe effectiveSeptember 29, 1989, 14 TexReg 4786; amended to be effective November 23, 1989, 14 TexReg 5935; amended to be effective May 25, 1990, 15 TexReg 2687; amended to be effective August 21, 1990, 15 TexReg 4504; amended to be effective November 28, 1990, 15 TexReg 6500; amended to be effective July 18, 1991, 16 TexReg 3777; amended to be effective October 29, 1991, 16 TexReg 5847; amended to be effective May 19, 1992, 17 TexReg 3252; amended to be effective September 2, 1993, 18 TexReg 5594; amended to be effective February 21, 1994, 19 TexReg 806; amended to be effective January 25, 1995, 20 TexReg 151; amended to be effective July 3, 1995, 20 TexReg 4409; amended to be effective September 6, 1996, 21 TexReg 8182; amended to be effective February 16, 1998, 23 TexReg 1099; amended to be effective September 16, 1999, 24 TexReg 7276; amended to be effective March26,2000, 25 TexReg2400;amended to be effective July 10, 2000, 25 TexReg 6557; amended to be effective September 13, 2001, 26 TexReg 6954; amended to be effective January 8, 2002, 27 TexReg 274; amended to be effective July 17, 2003, 28 TexReg 5538; amended to be effective December 31, 2003, 28 TexReg 11612; amended to be effective June 29, 2004, 29 TexReg 6120; amended to be effective May 3, 2006, 31 TexReg 3588; amended to be effective June 5, 2008, 33 TexReg 4332; amended to be effective March 15, 2010, 35 TexReg 2202.