34 Tex. Admin. Code § 85.3 – Eligibility and Participation

(a) Dependent care reimbursement plans.
1. (1) Eligibility. Any employee eligible to participate in the Uniform Group Insurance Program, except seasonal and temporary employees and graduate students, may elect to participate in the dependent care reimbursement plan. For plan year 1993 only, beginning September 1, 1992, those graduate students in institutions of higher education who have a dependent care account on August 31, 1992, are exempt from this rule.
2. (2) Participation.
  1. (A) An employee who is eligible under paragraph (1) of this subsection may elect to participate by completing and submitting a TexFlex election form within the first 30 days of employment. The effective date will be the first day of the following month, unless the employee makes an election on the first day of the month and designates that day to be the effective date.
  2. (B) An employee who was otherwise eligible to participate in the Uniform Group Insurance Program but who declined participation in the dependent care reimbursement account prior to the beginning of a plan year, but who after the beginning of a plan year has a change in family status, as defined in §85.7(c)(1)(B) of this title (relating to Enrollment), may elect to participate in the dependent care reimbursement account if the change is consistent with the change in family status, by completing and submitting a TexFlex election form within 30 days from the date the change in family status event occurs. The effective date will be the first day of the following month, unless the employee makes an election on the first day of the month and designates that day to be the effective date.
  3. (C) A change in family status, as defined in §85.7(c)(1)(B) of this title (relating to Enrollment) will permit a change or revocation of participation during the plan year. A TexFlex election form must be submitted within 30 days from the date the change in family status event occurs. The effective date will be the first day of the following month, unless the employee makes an election on the first day of the month and designates that to be the effective date.
  4. (D) Annual enrollment period.
    1. (i) Eligible active employees will have an opportunity to enroll or change benefit options during the annual enrollment period. The annual enrollment period will be prior to the beginning of a new plan year.
    2. (ii) Employees on approved leave of absence or extended sick leave without pay on the first day of a new plan year will be provided an opportunity to enroll or to change benefit options within the first 30 days after return to active duty.
3. (3) Duration of participation.
  1. (A) An employee's election to participate or to waive participation in the dependent care reimbursement plan shall be irrevocable for the plan year unless there is a change in family status as defined in §85.7(c)(1)(B) of this title (relating to Enrollment).
  2. (B) A terminated employee returning to state or institution of higher education employment or an employee returning to active duty from an approved leave of absence without pay, or transferring from one state agency or institution to another or between an agency and an institution of higher education as defined in these rules, within the same plan year, may not change and shall retain for the remainder of the plan year, the election in existence on the participant's last active duty date.
(b) Health care reimbursement plan.
1. (1) Eligibility.
  1. (A) Any employee eligible to participate in the Uniform Group Insurance Program, except seasonal and temporary employees and graduate students, who has completed six continuous months of full-time State of Texas or an institution of higher education, as defined in these rules, employment and who is classified as a full-time regular employee on September 1 of a new plan year or after the start of a plan year, may elect to participate in a health care reimbursement account. For plan year 1993 only, beginning September 1, 1992, those employees and graduate students in institutions of higher education who have a health care account on August 31, 1992, are exempt from this rule.
  2. (B) An employee whose employment has been terminated, voluntarily or involuntarily, and who had a health care reimbursement account at the time of termination, must retain the health care reimbursement account for the applicable period of coverage. In addition, such a terminated employee may elect to enroll in a health care reimbursement account continuation coverage for the period as provided in the Public Health Service Act. A formal continuation coverage notification on a TexFlex election form provided by the Employees Retirement System of Texas must be completed and returned to the Employees Retirement System of Texas within 60 days from the date coverage is lost. Eligibility to participate is contingent upon pre-payment, on a monthly or annual basis, of the elected amount, plus a 2.0% service charge on the elected amount, and the administrative fee for the plan year. Payments are due on the first day of each month and must be received no later than the 30th day of the month. Failure to pay will automatically cancel enrollment and future eligibility.
  3. (C) An employee whose employment has been terminated, voluntarily or involuntarily except for those persons not eligible pursuant to subparagraph (A) of this paragraph, and who has health insurance continuation coverage under the Public Health Services Act on September 1, may elect to participate in a health care reimbursement account during annual enrollment. A formal election must be made on a TexFlex election form prior to the beginning of a new plan year. Eligibility to participate is contingent upon pre-payment, on a monthly or annual basis, of the elected amount, plus a 2% service charge on the elected amount, plus the administrative fee for the plan year. Payments are due on the first day of each month and must be received no later than the 30th day of the month. Failure to pay will automatically cancel enrollment and future eligibility.
2. (2) Participation.
  1. (A) An employee who is eligible under paragraph (1)(A) and (C) of this subsection may elect to participate by completing and submitting a TexFlex election form during the annual enrollment period or within 30 days after becoming eligible in the new plan year. The effective date of the election will be September 1 of the plan year or the first day of the month following the date of signature on the TexFlex election form, unless the employee makes an election on the first day of the month and designates that day to be the effective date.
  2. (B) An employee who was eligible but who declined participation in the health care reimbursement account prior to the beginning of a plan year, but who after the beginning of a plan year has an eligible change in family status, as defined in §85.7(c)(1)(A) of this title (relating to Enrollment), may elect to participate in a health care reimbursement account if the change is consistent with the change in family status by completing and submitting an TexFlex election form within 30 days from the date the change in family status event occurs. The effective date will be the first day of the following month, unless the employee makes an election on the first day of the month and designates that day to be the effective date.
  3. (C) An employee whose employment has been terminated, voluntarily or involuntarily except for those persons not eligible pursuant to subparagraph (A) of this paragraph, and who has health insurance continuation coverage under the Public Health Services Act on September 1, may elect to participate in a health care reimbursement account during annual enrollment. A formal election must be made on a TexFlex election form prior to the beginning of a new plan year. Eligibility to participate is contingent upon pre-payment, on a monthly or annual basis, of the elected amount, plus a 2% service charge on the elected amount, plus the administrative fee for the plan year. Payments are due on the first day of each month and must be received no later than the 30th day of the month. Failure to pay will automatically cancel enrollment and future eligibility.
  4. (D) A change in family status, as defined in §85.7(c)(1)(A) of this title (relating to Enrollment) will permit an increase in the election amount during the plan year. A TexFlex election form must be completed and submitted within 30 days from the date the change in family status event occurs. The effective date of change will be the first day of the following month, unless the employee makes an election on the first day of the month and designates that to be the effective date.
  5. (E) Eligible active employees and terminated employees with continuation health coverage under the Public Health Service Act on September 1, and terminated employees with a health care reimbursement account on August 31 will be eligible to enroll or to change benefit options during the annual enrollment period. The annual enrollment period will be prior to the beginning of a new plan year. Employees on approved leave of absence without pay during the annual enrollment period who return to work after the start of a new plan year, and who meet the eligibility requirement under paragraph (1)(A) of this subsection will have 30 days from the eligibility date to enroll.
3. (3) Duration of participation.
  1. (A) An active or terminated employee's election to or not to participate in a health care reimbursement account shall be irrevocable for the plan year.
  2. (B) An employee returning to active duty from an approved leave of absence without pay or transferring from one state agency or institution to another or between an agency and an institution of higher education as defined in these rules, within the same plan year, must retain the election in existence on the last active duty date or the date of transfer for the remainder of the plan year, unless as described in subparagraph (D) of this paragraph.
  3. (C) An employee who is enrolled in a health care reimbursement account who terminates employment during the plan year must retain the health care account for the remainder of the plan year and prepay premiums or make monthly premium payments due for the remainder of the plan year, as described in paragraph (1)(B) of this subsection.
  4. (D) Notwithstanding any provision to the contrary in this Plan, if a participant goes on a qualifying unpaid leave under the Family and Medical Leave Act of 1993 (FMLA), to the extent required by the FMLA, the Plan Administrator will continue to maintain the participant's health care reimbursement account on the same terms and conditions as though he were still an active employee (i.e., the Plan Administrator will continue to provide benefits to the extent the employee opts to continue his coverage). If the employee opts to continue his coverage, the employee may pay his share of the premium in the same manner as a participant on non-FMLA leave, including with after-tax dollars while on leave or the employee may be given the option to pre-pay all or a portion of his share of the premium for the expected duration of the leave on a pre-tax salary reduction basis out of his pre-leave compensation by making a special election to that effect prior to the date such compensation would normally be made available to him (provided, however, that pre-tax dollars may not be utilized to fund coverage during the next plan year). Upon return from such leave, the employee will be permitted to reenter the Plan on the same basis the employee was participating in the Plan prior to his leave, or as otherwise required by the FMLA.

Source Note:The provisions of this §85.3 adopted to be effective August 12, 1988, 13 TexReg 3754; amended to be effective September 28, 1989, 14 TexReg 4787; amended to be effective September 1, 1990, 15 TexReg 4646; amended to be effective September 1, 1991, 16 TexReg 3779; amended to be effective September 1, 1992, 17 TexReg 2874; amended to be effective September 2, 1993, 18 TexReg 5595; amended to be effective November 11, 1996, 21 TexReg 10766; amended to be effective February 12, 1998, 23 TexReg 1313; amended to be effective September 1, 1998, 23 TexReg 4571.