(a) A private purchasing cooperative described in this section and the Texas Health Benefits Purchasing Cooperative described in Insurance Code Chapter 1501:
  (1) must arrange for small or large employer health benefit plan coverage for small or large employer groups that participate in the cooperative by contracting with small or large employer carriers that meet the criteria established in Insurance Code §1501.061 (concerning Requirements Applicable to Health Benefit Plan Issuers with Which Cooperative May Contract) and subsection (b) of this section;
  (2) must collect premiums to cover the cost of:
    (A) small or large employer health benefit plan coverage purchased through the cooperative; and
    (B) the cooperative's administrative expenses;
  (3) may contract with agents to market coverage issued through the cooperative;
  (4) must establish administrative and accounting procedures for the operation of the cooperative;
  (5) must establish procedures under which an applicant for or participant in coverage issued through the cooperative may have a grievance reviewed by an impartial person;
  (6) may contract with a small or large employer carrier or third-party administrator to provide administrative services to the cooperative;
  (7) must contract with small or large employer carriers for the provision of services to small or large employers covered through the cooperative;
  (8) must develop and implement a plan to maintain public awareness of the cooperative and publicize the eligibility requirements for, and the procedures for enrollment in coverage through the cooperative;
  (9) may negotiate the premiums paid by its members; and
  (10) may offer other ancillary products and services to its members that are customarily offered in conjunction with health benefit plans.
(b) A cooperative may contract only with small or large employer carriers that desire to offer coverage through the cooperative and that demonstrate:
  (1) the carrier is a health carrier or HMO licensed and in good standing with TDI;
  (2) the capacity to administer the health benefit plans;
  (3) the ability to monitor and evaluate the quality and cost effectiveness of care and applicable procedures;
  (4) the ability to conduct utilization management and applicable procedures and policies;
  (5) the ability to ensure enrollees adequate access to health care providers, including adequate numbers and types of providers;
  (6) a satisfactory grievance procedure and the ability to respond to enrollees' calls, questions, and complaints; and
  (7) financial capacity, either through financial solvency standards as applied by the commissioner or through appropriate reinsurance or other risk-sharing mechanisms.
(c) A cooperative may not self-insure or self-fund any health benefit plan or portion of a plan.
(d) A cooperative must comply with federal laws applicable to cooperatives and health benefit plans issued through cooperatives.

Source Note: The provisions of this §26.442 adopted to be effective May 17, 2017, 42 TexReg 2539