.
The Attorney General of Texas
JIM MATTOX December 30, 1983
Attorney General
Supreme Court Building Honorable Carl A. Parker Opinion No. JM-115
P. 0. Box 12546 Chairman
Austin. TX. 76711. 2546 Senate Education Committee Re: Obligation of state to
5121475.2501
Texas State Senate fund university insurance
Telex 9101674.1367
Telecopier 512/475-0266 P. 0. Box 12068, Capitol Station premiums for employees
Austin, Texas 78711
714 Jackson, Suite 700 Dear Senator Parker:
Dallas. TX. 75202-4506
2141742.6944
You ask the following two questions concerning the "Texas State
College and University Employees Uniform Insurance Benefits Act,"
4624 Alberta Ave., Suite 160 article 3.50-3 of the Insurance Code:
El Paso, TX. 79905-2793
9151533.3464
(1) Does the state have any obligation to
r‘
provide the funds necessary in order for each
1001 Texas. Suite 700 university to provide the proper level of
tto~ston, TX. 77002-3111 insurance coverage? Are those institutions who
7131223.5666 may not have the necessary unappropriated funds,
and who are unable to find commercial insurance
606 Broadway, Suite 312
carriers willing to provide the minimum required
Lubbock, TX. 79401.3479 coverage for the state's appropriation of $70 per
6061747.5236 employee, per month, entitled to the additiona~l
funds needed to provide the required coverage?
4309 N. Tenth. Suite B
McAllen. TX. 76501-1665
(2) In the event that the university is unable
512,662.4547 to provide its employees with the minimum coverage
because of its financial inability to supplement
the state appropriation, will university employees
200 Main Plaza, Suite 400
have a cause of action against the university, any
San Antonio. TX. 76205.2797
5121225.4191
of its officers, and/or the state of Texas?
Article 3.50-3 of the Insurance Code requires state colleges and
An Equal Opportunity/ universities to provide employees with basic life, accident, and
Affirmative Action Employer
health insurance coverages
at least equal to those commonly provided in
private industry and those provided employees of
other agencies of the State of Texas under the
Texas Employees Uniform Group Insurance Benefits
Act.
Ins. Code art. 3.50-3, §2(b) (purpose clause). An administrative
council established under the act determines basic coverage standards
p. 485
Honorable Carl A. Parker - Page 2(.X+115)
that are at least equal to those provided in private industry and
those provided employees of other state agencies. Sec. 4(a)(4)(A).
The employer must make basic coverage available to each employee at no
cost to the employee. Sec. 11. As your first question indicates,
some universities are unabl~e to provide basic coverage from the
state's appropriation of $70 per employee. Attorney General Opinion
MW-215 (1980) determined that the university must pay any excess
premium from non-appropriated funds, but you state that some
universities lack sufficient non-appropriated funds. You state in
your request letter that costs of health care vary considerably from
one region of Texas to another. Two areas of high cost medical care,
Houston and Beaumont/Port Arthur, also have higher rates of cancer
than the state as a whole. You also state that some university
employee groups are so small that a few large claims in one year can
raise future premiums to a level exceeding the state appropriation.
With this background in mind, we turn to your first question. In
essence, you ask whether the legislature must appropriate a 'sufficient
amount to fully fund premiums for the statutorily required basic
coverage.
The legislative power of Texas is vested in the Senate and the
House. Tex. Const. art. III, 01. The legislature has full power and
discretion to enact laws. subject only to limitations contained in the
state and federal constitution. Watts v. Mann, 187 S.W.2d 917, 924
(Tex. Civ. App. - Austin 1945, writ ref'd); Conley v. Daughters of the
Republic, 156 S.W. 197 (Tex. 1913); Tuttle v. Wood, 35 S.W.2d 1061
(Tex. Cl". App. - San Antonio 1930, writ ref'd). Funds in the
treasury may be appropriated only by legislative action, E Tex.
Const. art. VIII, $6; see generally Letter Advisory No. 132 (1977),
and legislative discretion to appropriate funds is in fact limited by
several constitutional provisions. See, e.g. arts. III, %%44. 49a.
50; art. IV, 914; art. VIII, §6.
Article 3.50-3 of the Insurance Code is a general law. and does
not itself appropriate funds to carry out its purposes. Pickle v.
Finley. 44 S.W. 480 (Tex. 1898). The legislature in enacting article
3.50-3 could not thereby bind subsequent legislatures to make
appropriations to carry out its purposes. See generally Watts v.
Mann, supra at 924 (one legislature may not limit the power of a
subsequent legislature to enact laws). Article 3.50-3 does not
establish a constitutionally protected vested right in university
employees to full payment of basic coverage from appropriated funds.
We therefore conclude that the legislature has no obligation to
appropriate the funds necessary for each university to provide the
proper level of insurance coverage. Your first question is answered
in the negative.
?
You next ask whether university employees will have a cause of
action against the university, its officers, or the state if the
university is unable to provide them with basic coverage pursuant to
p. 486
Honorable Carl A. Parker - Page 3 ($4-115)
section 11 of article 3.50-3. A "cause of action" is a fact or facts
entitling one to institute and maintain an action which must be
alleged and proved in order to obtain relief. A. H. Belo Corp. v.
Blanton, 129 S.W.2d 619 (Tex. 1939). The violation of a right with
consequent damage gives rise to a cause of action. Lotus Oil co. V.
Spires, 240 S.W.2d 357 (Tex. Civ. App. - El Paso 1950, writ ref'd
n.r.e.).
Since we cannot investigate and resolve fact questions in the
opinion process, we cannot say with certainty whether the employees of
any university subject to article 3.50-3 have a cause of, action
against an official or governmental entity for failure to provide
insurance coverage. If university employees determine that the facts
establish a cause of action they must seek legislative consent to
bring a suit against the state, a state agency, or an official acting
within his legally authorized area of discretion. Director of the
Department of Agriculture and Environment v. Printing Industries
Association of Texas, 600 S.W.2d 264 (Tex. 1980); Texas Technological
College v. Fry 278 S.W.2d 480 (Tex. Civ. App. - Amarillo 1954, no
writ); Walsh v.'University of Texas, 169 S.W.2d 993 (Tex. Civ. App. -
El Paso 1942, writ ref'd). A litigant who wins a damages claim
against the state must then seek payment from appropriated funds.
S. & G.Construction Company v. Bullock, 545 S.W.2d 953 (Tex. 1977).
If the facts show that a state officer has acted beyond his
statutory capacity, the injured party may sue the official f.n his
individual capacity, without legislative consent. Simmons v. Vinson,
394 F.2d 732 (5th Cir. 1968) cert. denied 393 U.S. 968 (1968). Such a
suit would not seek damages from the state, but from the personal
funds of the officer. We reemphasize, however, that we have made no
finding as to whether facts exist which would give rise to a cause of
action against any person.
SUMMARY
The legislature does not have an obligation to
fully fund insurance premiums necessary to pay
basic coverage for university employees under
article 3.50-3 of the Insurance Code. Whether
university employees who do not receive minimum
coverage have a cause of action against the state,
the university, or university employees is a fact
question which cannot be in the opinion
process.
Attorney General of Texas
p. 487
Honorable Carl A. Parker - Page 4 (3%115)
TOM GREEN
First Assistant Attorney General
DAVID R. RICHARDS
Executive Assistant Attorney General
Prepared by Susan L. Garrison
Assistant Attorney General
APPROVED:
OPINION COMMITTEE
Rick Gilpin, Chairman
Jon Bible
David Brooks
Colin Carl
Susan Garrison
Jim Moellinger
Nancy Sutton
p. 488