i




                                   The Attorney        General of Texas

    JIM MAlTOX
                                                  Dexmber   23, 1985
    Attorney General


    SupremeCourt     Building      Honorable Randall L. Sherrod         Opinion No. JM-,406
    P. 0. BOX 12548                Criminal District Attorney
    Austin, TX. 78711. 2548        Randall County Courthouse            Re: Whether a county may join
    51214752501
                                   Canyon, Texas   79015                with other governmental entities
    Telex 9101874.1367
    Telecopier  512f475-0286
                                                                        in a pool for the operating of a
                                                                        self-funding health plan

    714 Jackson, Suite 700         Dear Mr. Sherrod:
    Dallas, TX. 7520245M
    2141742.S944
                                        You inform us that the majority of the Randall County Commis-
                                   sioners Court and ,somemembers of the governing body of the city of
    4824 Alberta Ave., Suite 160   Amarillo are interested in forming a self-funded health plan pool,
    El Paso, TX. 799052793         consisting of Anarillo and Randall County employees and their
    9151533-34&(
                                   dependents, to provide health, medical, and hospital insurance to all
                                   members of this cLass and their dependents. You also inform us that
    1001 Texas, Suite 700
                                   the governing bodies of other entities such as nearby Potter County
    Houston, TX. 77002-3111        may also become interested in contracting with the other members of
    71312235888                    such a pool under the Interlocal Cooperation Act. The pool would be
                                   formed by contract among parties.
    806 Broadway, Suite 312
    Lubbock, TX. 794013479
                                        In that regard, you ask:
    SCW747-5238
                                               Does ,the Randall County Commissioners Court
                                            have the power to join the city of Amarillo or any
    4309 N. Tenth. Suite S
    McAllen, TX. 78501.1885
                                            other nr:srby state governmental entity in forming
    512lSS2.4547                            a pool f'ora self-funding health and hospitalira-
                                            tion p:.e!n in the nature of self-insurance,
                                            receiving voluntary premiums from employees and
    200 Main Plaza, Suite 400
                                            elected officials of those entities to cover
    San Antonio, TX. 782052797
    512f2284191
                                            themselves and their dependents?

                                        A county commissioners court has only the powers conferred either
    An Equal Oppatunityl           expressly or by necessary implication by the constitution and statutes
    Affirmative Action Employer    of this state. See:Tex. Const. art. V, 918; Canales v. Laughlin, 214
                                   S.W.Zd 451, 453 TKk.   1948). The limited authority granted to local
                                   political subdivisions under article 3.51-2 of the Insurance Code does
                                   not encompass y0c.r particular arrangement; such authority must be
                                   found elsewhere. Id. This office has held on numerous occasions that
                                   the Interlocal CofyGation Act, article 4413(32c), in sections 4(a)
                                   and 4(b), V.T.C.S., authorizes a county to contract with other
                                   counties or local political subdivisions for the performance of




                                                              p. 1859
Honorable Randall L. Sherrod - Page 2    (J&4,06)




                                   , as defined in section 3(Z), which
governmental services and :iunctions
all parties to the contra:t are legally authorized to perform. See
Attorney General Opinions NW-347 (1981); E-392 (1974); E-28 (197x
~-1278 (1972). Therefore, the Interlocal Cooperation Act authorizes
Randall County to contract with other local entities only if there is
independent statutory or :onstitutional authority for the county to
provide a self-funded insurance plan for its department heads,
employees, and their dependents.

     In Attorney General Opinion MW-473 (1982). this office further
held:

          There is statutory authority for a comissioners
          court to adopt an insurance plan to provide
          hospitalization ::nsurancefor county officials and
          employees.    V.l'.C.S. art.   2372h-2.    Further
          authority is allw found in the Texas Insurance
          Code in articles 3.51 and 3.51-2. However, these
          statutes do not authorize the implementation of a
          plan to provide wlf-insurance or to provide group
          insurance that rculd be in contravention of the
          Texas Insurance Code.

Id. at 1658. Article 2372h, section 2, V.T.C.S., suthorizes a
colnmissionerscourt of a county having a population of 500,000 or more
to adopt rules and regulat,ionsto establish a hospital and insurance
fund for county employees 11sa part of their employment contract.  You
inform us that Randall County currently has a population of
approximately 76,000 inhab:.t:ants.Since there is a particular statute
authorizing a plan by certain counties, but no statute regarding
Randall County, we conclude that there is no authority for Randall
County to join a self-fund:.nghealth plan for its employees.

     Article 3.51-2 of tha Insurance Code authorizes any county or
political subdivision of s county to procure certain group insurance
policies covering officers, employees, and their dependents. However,
the provision does not pruvide for the self-funded health plan you
describe in this request. Article 3.51-2, part (a) of the Insurance
Code only authorizes the county to "procure contracts" or purchase
insurance from an insurwce       company as opposed to specifically
alloving the entities to rielf-fund a health insurance plan as the
legislature has provided :.n another statute amended during the same
session. See Ins. Code art. 3.50-3, 14(d) (governing boards of
colleges an~niversities   'nay provide self-funded insurance plans for
employees).

     We can find no other independent statutory basis authorizing the
Randall County Commissione:rsCourt to provide a self-funded insurance
plan for its employees, deIla.rtment
                                   heads, and their dependents. It is




                               p. 1860
Eonorable Randall L. SherrDd - Page 3 ,(~&486.)




our opinion that the county may not contract with          the entities
described above under the Interlocal Cooperation Act.

                              SUMMARY

            The Randall County Commissioners Court is not
         authorized to contract with nearby state govern-
         mental entities to form a pool for a self-funding
         health and hospit.slisationplan for its employees,
         department heads, and their dependents.




                                         JIM     MATTOX
                                         Attorney General of Texas

JACK HIGHTOWKR
First Assistant Attorney General

MARY KELLER
Executive Assistant Attorney General

ROBERT GRAY
Special Assistant Attorney 'General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Tony Guillory
Assistant Attorney General




                               p. 1861
