093_SB0380

 
                                     LRB093 08227 JAM 08439 b

 1        AN ACT concerning government employee benefits.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.  The  State  Employees Group Insurance Act of
 5    1971 is amended by changing Section 6.5 as follows:

 6        (5 ILCS 375/6.5)
 7        (Section scheduled to be repealed on July 1, 2004)
 8        Sec. 6.5. Health benefits for TRS benefit recipients  and
 9    TRS dependent beneficiaries.
10        (a)  Purpose.   It  is The purpose of this amendatory Act
11    of 1995 is to transfer the administration of the  program  of
12    health  benefits established for benefit recipients and their
13    dependent beneficiaries under  Article  16  of  the  Illinois
14    Pension   Code   to  the  Department  of  Central  Management
15    Services.
16        (b)  Transition provisions.  The Board of Trustees of the
17    Teachers' Retirement System shall continue to administer  the
18    health  benefit  program  established under Article 16 of the
19    Illinois Pension Code through December 31,  1995.   Beginning
20    January   1,  1996,  the  Department  of  Central  Management
21    Services shall be responsible for administering a program  of
22    health  benefits for TRS benefit recipients and TRS dependent
23    beneficiaries under this Section.  The Department of  Central
24    Management Services and the Teachers' Retirement System shall
25    cooperate   in  this  endeavor  and  shall  coordinate  their
26    activities  so  as  to  ensure  a   smooth   transition   and
27    uninterrupted health benefit coverage.
28        (c)  Eligibility.   All  persons who were enrolled in the
29    Article 16 program at the  time  of  the  transfer  shall  be
30    eligible to participate in the program established under this
31    Section  without  any  interruption  or  delay in coverage or
 
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 1    limitation   as   to   pre-existing    medical    conditions.
 2    Eligibility   to  participate  shall  be  determined  by  the
 3    Teachers' Retirement System.  Eligibility  information  shall
 4    be  communicated  to  the  Department  of  Central Management
 5    Services in a format acceptable to the Department.
 6        A TRS dependent beneficiary who is an unmarried child age
 7    19 or over and mentally or physically  handicapped  does  not
 8    become  ineligible  to  participate by reason of (i) becoming
 9    ineligible to be claimed  as  a  dependent  for  Illinois  or
10    federal  income tax purposes or (ii) receiving earned income,
11    so long as those earnings are insufficient for the  child  to
12    be fully self-sufficient.
13        (d)  Coverage.   The  level  of  health benefits provided
14    under this Section shall be similar to the level of  benefits
15    provided  by the program previously established under Article
16    16 of the Illinois Pension Code.
17        Group life insurance benefits are  not  included  in  the
18    benefits  to  be  provided  to TRS benefit recipients and TRS
19    dependent beneficiaries under this Act.
20        The program of health benefits  under  this  Section  may
21    include  any or all of the benefit limitations, including but
22    not limited to a reduction in benefits based  on  eligibility
23    for  federal  medicare  benefits,  that  are  provided  under
24    subsection  (a)  of  Section  6  of this Act for other health
25    benefit programs under this Act.
26        (e)  Insurance rates and premiums.   The  Director  shall
27    determine  the  insurance  rates and premiums for TRS benefit
28    recipients and TRS dependent beneficiaries, and shall present
29    to the Teachers' Retirement System of the State of  Illinois,
30    by   April   15  of  each  calendar  year,  the  rate-setting
31    methodology (including but not limited to utilization  levels
32    and  costs)  used  to determine the amount of the health care
33    premiums.
34        For Fiscal Year 1996, the premium shall be equal  to  the
 
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 1    premium  actually  charged in Fiscal Year 1995; in subsequent
 2    years, the premium shall never  be  lower  than  the  premium
 3    charged  in  Fiscal  Year  1995.   For  Fiscal Year 2003, the
 4    premium shall not exceed 110% of the premium actually charged
 5    in Fiscal Year 2002.  For Fiscal Year 2004, the premium shall
 6    not exceed 112% of the premium  actually  charged  in  Fiscal
 7    Year 2003.
 8        Rates  and  premiums  may  be  based  in  part on age and
 9    eligibility for federal medicare coverage.  However, the cost
10    of participation for a TRS dependent beneficiary  who  is  an
11    unmarried  child  age  19  or over and mentally or physically
12    handicapped shall not exceed the cost  for  a  TRS  dependent
13    beneficiary  who  is  an  unmarried  child  under  age 19 and
14    participates in  the  same  major  medical  or  managed  care
15    program.
16        The  cost  of  health benefits under the program shall be
17    paid as follows:
18             (1)  For a TRS benefit recipient selecting a managed
19        care program, up to 75% of the total insurance rate shall
20        be paid from the Teacher Health Insurance Security Fund.
21             (2)  For a TRS benefit recipient selecting the major
22        medical  coverage  program,  up  to  50%  of  the   total
23        insurance  rate  shall  be  paid  from the Teacher Health
24        Insurance Security Fund if  a  managed  care  program  is
25        accessible,  as  determined  by  the Teachers' Retirement
26        System.
27             (3)  For a TRS benefit recipient selecting the major
28        medical  coverage  program,  up  to  75%  of  the   total
29        insurance  rate  shall  be  paid  from the Teacher Health
30        Insurance Security Fund if a managed care program is  not
31        accessible,  as  determined  by  the Teachers' Retirement
32        System.
33             (4)  The balance of the rate of insurance, including
34        the entire premium of  any  coverage  for  TRS  dependent
 
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 1        beneficiaries  that  has  been  elected, shall be paid by
 2        deductions authorized by the TRS benefit recipient to  be
 3        withheld  from  his  or  her  monthly  annuity or benefit
 4        payment from the Teachers' Retirement System; except that
 5        (i) if the balance of the cost of  coverage  exceeds  the
 6        amount  of  the  monthly  annuity or benefit payment, the
 7        difference  shall  be  paid  directly  to  the  Teachers'
 8        Retirement System by the TRS benefit recipient, and  (ii)
 9        all  or  part of the balance of the cost of coverage may,
10        at the school  board's option, be paid to  the  Teachers'
11        Retirement  System  by  the  school  board  of the school
12        district from which the TRS benefit recipient retired, in
13        accordance with Section 10-22.3b of the School Code.  The
14        Teachers' Retirement System shall  promptly  deposit  all
15        moneys  withheld  by or paid to it under this subdivision
16        (e)(4) into the Teacher Health Insurance  Security  Fund.
17        These  moneys  shall  not  be  considered  assets  of the
18        Retirement System.
19        (f)  Financing.  Beginning July  1,  1995,  all  revenues
20    arising   from  the  administration  of  the  health  benefit
21    programs established under Article 16 of the Illinois Pension
22    Code or this Section shall  be  deposited  into  the  Teacher
23    Health  Insurance Security Fund, which is hereby created as a
24    nonappropriated trust fund  to  be  held  outside  the  State
25    Treasury,   with  the  State  Treasurer  as  custodian.   Any
26    interest earned on moneys in  the  Teacher  Health  Insurance
27    Security Fund shall be deposited into the Fund.
28        Moneys  in  the  Teacher  Health  Insurance Security Fund
29    shall be used only to pay the costs  of  the  health  benefit
30    program  established under this Section, including associated
31    administrative costs,  and  the  costs  associated  with  the
32    health  benefit  program  established under Article 16 of the
33    Illinois  Pension  Code,  as  authorized  in  this   Section.
34    Beginning  July 1, 1995, the Department of Central Management
 
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 1    Services  may  make  expenditures  from  the  Teacher  Health
 2    Insurance Security Fund for those costs.
 3        After other funds authorized for the payment of the costs
 4    of the health benefit program established under Article 16 of
 5    the Illinois Pension Code are exhausted and until January  1,
 6    1996  (or  such  later  date  as  may  be  agreed upon by the
 7    Director of Central Management Services and the Secretary  of
 8    the  Teachers'  Retirement  System),  the  Secretary  of  the
 9    Teachers'  Retirement  System  may make expenditures from the
10    Teacher Health Insurance Security Fund as necessary to pay up
11    to 75% of the cost of providing health coverage  to  eligible
12    benefit  recipients  (as  defined  in  Sections  16-153.1 and
13    16-153.3 of the Illinois Pension Code) who  are  enrolled  in
14    the  Article  16 health benefit program and to facilitate the
15    transfer of administration of the health benefit  program  to
16    the Department of Central Management Services.
17        (g)  Contract   for  benefits.   The  Director  shall  by
18    contract, self-insurance, or  otherwise  make  available  the
19    program  of  health  benefits  for TRS benefit recipients and
20    their TRS dependent beneficiaries that  is  provided  for  in
21    this  Section.   The  contract  or  other arrangement for the
22    provision of these health benefits shall be on  terms  deemed
23    by  the  Director  to be in the best interest of the State of
24    Illinois and the TRS benefit recipients  based  on,  but  not
25    limited  to,  such  criteria  as administrative cost, service
26    capabilities of the carrier  or  other  contractor,  and  the
27    costs of the benefits.
28        (h)  Continuation  and termination of program.  It is the
29    intention of the General Assembly that the program of  health
30    benefits  provided  under  this  Section  be maintained on an
31    ongoing, affordable basis through June 30, 2004.  The program
32    of health benefits provided under this Section is  terminated
33    on July 1, 2004.
34        The  program  of  health  benefits  provided  under  this
 
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 1    Section may be amended by the State and is not intended to be
 2    a  pension  or retirement benefit subject to protection under
 3    Article XIII, Section 5 of the Illinois Constitution.
 4        (i)  Repeal.  This Section is repealed on July 1, 2004.
 5    (Source: P.A. 92-505, eff.  12-20-01;  92-862,  eff.  1-3-03;
 6    revised 1-10-03.)