Insights

On May 28, 2015, Gov. Abbott signed HB 1945 into law which provides patients with unlimited access to their doctor - either in person or by phone or email - for a full range of comprehensive primary care services in exchange for a flat fee. HB 1945 removes such arrangements from the jurisdiction of TDI, stating that the arrangements are not accident or health insurance or coverage under the Texas Insurance Code.

Typically, such direct primary care arrangements have been considered on par with insurance because they are payable whether or not medical care is provided. Thus, they fall under the general “no reimbursement of insurance premiums” rule that applies to health FSAs and HSAs and should not be reimbursed on a pre-tax basis. It is unclear whether this new law in Texas will permit employees to pay for such coverage on a pre-tax basis. Further guidance would be welcome. Importantly, since such an arrangement is not an insurance policy, it is unlikely that medical services will constitute the minimum essential coverage requirement under PPACA. Employees opting for this service in lieu of employer-sponsored coverage should consult with their tax advisors as to potential tax implications under the individual shared responsibility requirement.

The law is effective immediately.

HB 1945 »