State of Illinois
92nd General Assembly
Legislation

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92_SB1251

 
                                               LRB9207851JScs

 1        AN ACT concerning health 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        Sec. 6.5. Health benefits for TRS benefit recipients  and
 8    TRS dependent beneficiaries.
 9        (a)  Purpose.   It  is The purpose of this amendatory Act
10    of 1995 is to transfer the administration of the  program  of
11    health  benefits established for benefit recipients and their
12    dependent beneficiaries under  Article  16  of  the  Illinois
13    Pension   Code   to  the  Department  of  Central  Management
14    Services.
15        (b)  Transition provisions.  The Board of Trustees of the
16    Teachers' Retirement System shall continue to administer  the
17    health  benefit  program  established under Article 16 of the
18    Illinois Pension Code through December 31,  1995.   Beginning
19    January   1,  1996,  the  Department  of  Central  Management
20    Services shall be responsible for administering a program  of
21    health  benefits for TRS benefit recipients and TRS dependent
22    beneficiaries under this Section.  The Department of  Central
23    Management Services and the Teachers' Retirement System shall
24    cooperate   in  this  endeavor  and  shall  coordinate  their
25    activities  so  as  to  ensure  a   smooth   transition   and
26    uninterrupted health benefit coverage.
27        (c)  Eligibility.   All  persons who were enrolled in the
28    Article 16 program at the  time  of  the  transfer  shall  be
29    eligible to participate in the program established under this
30    Section  without  any  interruption  or  delay in coverage or
31    limitation   as   to   pre-existing    medical    conditions.
 
                            -2-                LRB9207851JScs
 1    Eligibility   to  participate  shall  be  determined  by  the
 2    Teachers' Retirement System.  Eligibility  information  shall
 3    be  communicated  to  the  Department  of  Central Management
 4    Services in a format acceptable to the Department.
 5        (d)  Coverage.  The level  of  health  benefits  provided
 6    under  this Section shall be similar to the level of benefits
 7    provided by the program previously established under  Article
 8    16 of the Illinois Pension Code.
 9          Group  life  insurance benefits are not included in the
10    benefits to be provided to TRS  benefit  recipients  and  TRS
11    dependent beneficiaries under this Act.
12        The  program  of  health  benefits under this Section may
13    include any or all of the benefit limitations, including  but
14    not  limited  to a reduction in benefits based on eligibility
15    for  federal  medicare  benefits,  that  are  provided  under
16    subsection (a) of Section 6 of  this  Act  for  other  health
17    benefit programs under this Act.
18        (e)  Insurance  rates  and  premiums.  The Director shall
19    determine the insurance rates and premiums  for  TRS  benefit
20    recipients  and TRS dependent beneficiaries.  For Fiscal Year
21    1996, the premium shall be  equal  to  the  premium  actually
22    charged  in  Fiscal  Year  1995.   In  subsequent  years, the
23    premium shall never be lower  than  the  premium  charged  in
24    Fiscal Year 1995.  Rates and premiums may be based in part on
25    age and eligibility for federal medicare coverage.
26        The  cost  of  health benefits under the program shall be
27    paid as follows:
28             (1)  For a TRS benefit recipient selecting a managed
29        care program, up to 75% of the total insurance rate shall
30        be paid from the Teacher Health Insurance Security Fund.
31             (2)  For a TRS benefit recipient selecting the major
32        medical  coverage  program,  up  to  50%  of  the   total
33        insurance  rate  shall  be  paid  from the Teacher Health
34        Insurance Security Fund if  a  managed  care  program  is
 
                            -3-                LRB9207851JScs
 1        accessible,  as  determined  by  the Teachers' Retirement
 2        System.
 3             (3)  For a TRS benefit recipient selecting the major
 4        medical  coverage  program,  up  to  75%  of  the   total
 5        insurance  rate  shall  be  paid  from the Teacher Health
 6        Insurance Security Fund if a managed care program is  not
 7        accessible,  as  determined  by  the Teachers' Retirement
 8        System.
 9             (4)  The balance of the rate of insurance, including
10        the entire premium of  any  coverage  for  TRS  dependent
11        beneficiaries  that  has  been  elected, shall be paid by
12        deductions authorized by the TRS benefit recipient to  be
13        withheld  from  his  or  her  monthly  annuity or benefit
14        payment from the Teachers' Retirement System; except that
15        (i) if the balance of the cost of  coverage  exceeds  the
16        amount  of  the  monthly  annuity or benefit payment, the
17        difference  shall  be  paid  directly  to  the  Teachers'
18        Retirement System by the TRS benefit recipient, and  (ii)
19        all  or  part of the balance of the cost of coverage may,
20        at the school  board's option, be paid to  the  Teachers'
21        Retirement  System  by  the  school  board  of the school
22        district from which the TRS benefit recipient retired, in
23        accordance with Section 10-22.3b of the School Code.  The
24        Teachers' Retirement System shall  promptly  deposit  all
25        moneys  withheld  by or paid to it under this subdivision
26        (e)(4) into the Teacher Health Insurance  Security  Fund.
27        These  moneys  shall  not  be  considered  assets  of the
28        Retirement System.
29        (f)  Financing.  Beginning July  1,  1995,  all  revenues
30    arising   from  the  administration  of  the  health  benefit
31    programs established under Article 16 of the Illinois Pension
32    Code or this Section shall  be  deposited  into  the  Teacher
33    Health  Insurance Security Fund, which is hereby created as a
34    nonappropriated trust fund  to  be  held  outside  the  State
 
                            -4-                LRB9207851JScs
 1    Treasury,   with  the  State  Treasurer  as  custodian.   Any
 2    interest earned on moneys in  the  Teacher  Health  Insurance
 3    Security Fund shall be deposited into the Fund.
 4        Moneys  in  the  Teacher  Health  Insurance Security Fund
 5    shall be used only to pay the costs  of  the  health  benefit
 6    program  established under this Section, including associated
 7    administrative costs,  and  the  costs  associated  with  the
 8    health  benefit  program  established under Article 16 of the
 9    Illinois  Pension  Code,  as  authorized  in  this   Section.
10    Beginning  July 1, 1995, the Department of Central Management
11    Services  may  make  expenditures  from  the  Teacher  Health
12    Insurance Security Fund for those costs.
13        After other funds authorized for the payment of the costs
14    of the health benefit program established under Article 16 of
15    the Illinois Pension Code are exhausted and until January  1,
16    1996  (or  such  later  date  as  may  be  agreed upon by the
17    Director of Central Management Services and the Secretary  of
18    the  Teachers'  Retirement  System),  the  Secretary  of  the
19    Teachers'  Retirement  System  may make expenditures from the
20    Teacher Health Insurance Security Fund as necessary to pay up
21    to 75% of the cost of providing health coverage  to  eligible
22    benefit  recipients  (as  defined  in  Sections  16-153.1 and
23    16-153.3 of the Illinois Pension Code) who  are  enrolled  in
24    the  Article  16 health benefit program and to facilitate the
25    transfer of administration of the health benefit  program  to
26    the Department of Central Management Services.
27        (g)  Contract   for  benefits.   The  Director  shall  by
28    contract, self-insurance, or  otherwise  make  available  the
29    program  of  health  benefits  for TRS benefit recipients and
30    their TRS dependent beneficiaries that  is  provided  for  in
31    this  Section.   The  contract  or  other arrangement for the
32    provision of these health benefits shall be on  terms  deemed
33    by  the  Director  to be in the best interest of the State of
34    Illinois and the TRS benefit recipients  based  on,  but  not
 
                            -5-                LRB9207851JScs
 1    limited  to,  such  criteria  as administrative cost, service
 2    capabilities of the carrier  or  other  contractor,  and  the
 3    costs of the benefits.
 4        (h)  Continuation of program.  It is the intention of the
 5    General Assembly that the program of health benefits provided
 6    under  this  Section  be maintained on an ongoing, affordable
 7    basis.  The program of health benefits  provided  under  this
 8    Section may be amended by the State and is not intended to be
 9    a  pension  or retirement benefit subject to protection under
10    Article XIII, Section 5 of the Illinois Constitution.
11    (Source: P.A. 89-21, eff. 6-21-95; 89-25, eff. 6-21-95.)

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