101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3444

 

Introduced 2/14/2020, by Sen. Neil Anderson

 

SYNOPSIS AS INTRODUCED:
 
5 ILCS 375/6.5

    Amends the State Employees Group Insurance Act of 1971. Provides that a TRS benefit recipient who has overpaid shall be entitled to a refund of overpayments that shall become immediately payable to the benefit recipient regardless of when the initial overpayment was made (currently, entitled to only 7 years of past payments). Provides that the Department of Central Management Services shall take every step to notify the benefit recipient of the overpayment and shall make every effort to process and make the payment as promptly as possible. Provides that the required payments are retroactive for any previously made overpayment that has not been paid out. Effective immediately.


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A BILL FOR

 

SB3444LRB101 19010 RJF 68469 b

1    AN ACT concerning government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The State Employees Group Insurance Act of 1971
5is 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
8TRS dependent beneficiaries.
9    (a) Purpose. It is the purpose of this amendatory Act of
101995 to transfer the administration of the program of health
11benefits established for benefit recipients and their
12dependent beneficiaries under Article 16 of the Illinois
13Pension Code to the Department of Central Management Services.
14    (b) Transition provisions. The Board of Trustees of the
15Teachers' Retirement System shall continue to administer the
16health benefit program established under Article 16 of the
17Illinois Pension Code through December 31, 1995. Beginning
18January 1, 1996, the Department of Central Management Services
19shall be responsible for administering a program of health
20benefits for TRS benefit recipients and TRS dependent
21beneficiaries under this Section. The Department of Central
22Management Services and the Teachers' Retirement System shall
23cooperate in this endeavor and shall coordinate their

 

 

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1activities so as to ensure a smooth transition and
2uninterrupted health benefit coverage.
3    (c) Eligibility. All persons who were enrolled in the
4Article 16 program at the time of the transfer shall be
5eligible to participate in the program established under this
6Section without any interruption or delay in coverage or
7limitation as to pre-existing medical conditions. Eligibility
8to participate shall be determined by the Teachers' Retirement
9System. Eligibility information shall be communicated to the
10Department of Central Management Services in a format
11acceptable to the Department.
12    Eligible TRS benefit recipients may enroll or re-enroll in
13the program of health benefits established under this Section
14during any applicable annual open enrollment period and as
15otherwise permitted by the Department of Central Management
16Services. A TRS benefit recipient shall not be deemed
17ineligible to participate solely by reason of the TRS benefit
18recipient having made a previous election to disenroll or
19otherwise not participate in the program of health benefits.
20    A TRS dependent beneficiary who is a child age 19 or over
21and mentally or physically disabled does not become ineligible
22to participate by reason of (i) becoming ineligible to be
23claimed as a dependent for Illinois or federal income tax
24purposes or (ii) receiving earned income, so long as those
25earnings are insufficient for the child to be fully
26self-sufficient.

 

 

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1    (d) Coverage. The level of health benefits provided under
2this Section shall be similar to the level of benefits provided
3by the program previously established under Article 16 of the
4Illinois Pension Code.
5    Group life insurance benefits are not included in the
6benefits to be provided to TRS benefit recipients and TRS
7dependent beneficiaries under this Act.
8    The program of health benefits under this Section may
9include any or all of the benefit limitations, including but
10not limited to a reduction in benefits based on eligibility for
11federal Medicare benefits, that are provided under subsection
12(a) of Section 6 of this Act for other health benefit programs
13under this Act.
14    (e) Insurance rates and premiums. The Director shall
15determine the insurance rates and premiums for TRS benefit
16recipients and TRS dependent beneficiaries, and shall present
17to the Teachers' Retirement System of the State of Illinois, by
18April 15 of each calendar year, the rate-setting methodology
19(including but not limited to utilization levels and costs)
20used to determine the amount of the health care premiums.
21        For Fiscal Year 1996, the premium shall be equal to the
22    premium actually charged in Fiscal Year 1995; in subsequent
23    years, the premium shall never be lower than the premium
24    charged in Fiscal Year 1995.
25        For Fiscal Year 2003, the premium shall not exceed 110%
26    of the premium actually charged in Fiscal Year 2002.

 

 

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1        For Fiscal Year 2004, the premium shall not exceed 112%
2    of the premium actually charged in Fiscal Year 2003.
3        For Fiscal Year 2005, the premium shall not exceed a
4    weighted average of 106.6% of the premium actually charged
5    in Fiscal Year 2004.
6        For Fiscal Year 2006, the premium shall not exceed a
7    weighted average of 109.1% of the premium actually charged
8    in Fiscal Year 2005.
9        For Fiscal Year 2007, the premium shall not exceed a
10    weighted average of 103.9% of the premium actually charged
11    in Fiscal Year 2006.
12        For Fiscal Year 2008 and thereafter, the premium in
13    each fiscal year shall not exceed 105% of the premium
14    actually charged in the previous fiscal year.
15    Rates and premiums may be based in part on age and
16eligibility for federal medicare coverage. However, the cost of
17participation for a TRS dependent beneficiary who is an
18unmarried child age 19 or over and mentally or physically
19disabled shall not exceed the cost for a TRS dependent
20beneficiary who is an unmarried child under age 19 and
21participates in the same major medical or managed care program.
22    The cost of health benefits under the program shall be paid
23as follows:
24        (1) For a TRS benefit recipient selecting a managed
25    care program, up to 75% of the total insurance rate shall
26    be paid from the Teacher Health Insurance Security Fund.

 

 

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1    Effective with Fiscal Year 2007 and thereafter, for a TRS
2    benefit recipient selecting a managed care program, 75% of
3    the total insurance rate shall be paid from the Teacher
4    Health Insurance Security Fund.
5        (2) For a TRS benefit recipient selecting the major
6    medical coverage program, up to 50% of the total insurance
7    rate shall be paid from the Teacher Health Insurance
8    Security Fund if a managed care program is accessible, as
9    determined by the Teachers' Retirement System. Effective
10    with Fiscal Year 2007 and thereafter, for a TRS benefit
11    recipient selecting the major medical coverage program,
12    50% of the total insurance rate shall be paid from the
13    Teacher Health Insurance Security Fund if a managed care
14    program is accessible, as determined by the Department of
15    Central Management Services.
16        (3) For a TRS benefit recipient selecting the major
17    medical coverage program, up to 75% of the total insurance
18    rate shall be paid from the Teacher Health Insurance
19    Security Fund if a managed care program is not accessible,
20    as determined by the Teachers' Retirement System.
21    Effective with Fiscal Year 2007 and thereafter, for a TRS
22    benefit recipient selecting the major medical coverage
23    program, 75% of the total insurance rate shall be paid from
24    the Teacher Health Insurance Security Fund if a managed
25    care program is not accessible, as determined by the
26    Department of Central Management Services.

 

 

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1        (3.1) For a TRS dependent beneficiary who is Medicare
2    primary and enrolled in a managed care plan, or the major
3    medical coverage program if a managed care plan is not
4    available, 25% of the total insurance rate shall be paid
5    from the Teacher Health Security Fund as determined by the
6    Department of Central Management Services. For the purpose
7    of this item (3.1), the term "TRS dependent beneficiary who
8    is Medicare primary" means a TRS dependent beneficiary who
9    is participating in Medicare Parts A and B.
10        (4) Except as otherwise provided in item (3.1), the
11    balance of the rate of insurance, including the entire
12    premium of any coverage for TRS dependent beneficiaries
13    that has been elected, shall be paid by deductions
14    authorized by the TRS benefit recipient to be withheld from
15    his or her monthly annuity or benefit payment from the
16    Teachers' Retirement System; except that (i) if the balance
17    of the cost of coverage exceeds the amount of the monthly
18    annuity or benefit payment, the difference shall be paid
19    directly to the Teachers' Retirement System by the TRS
20    benefit recipient, and (ii) all or part of the balance of
21    the cost of coverage may, at the school board's option, be
22    paid to the Teachers' Retirement System by the school board
23    of the school district from which the TRS benefit recipient
24    retired, in accordance with Section 10-22.3b of the School
25    Code. The Teachers' Retirement System shall promptly
26    deposit all moneys withheld by or paid to it under this

 

 

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1    subdivision (e)(4) into the Teacher Health Insurance
2    Security Fund. These moneys shall not be considered assets
3    of the Retirement System.
4        (5) If in any case an error is made in billing a TRS
5    benefit recipient under this Section, the Department shall
6    identify the error and refund the overpaid amount as soon
7    as practicable. A TRS benefit recipient who has overpaid
8    under this Section shall be entitled to a refund of
9    overpayments that shall become immediately payable to the
10    benefit recipient regardless of when the initial
11    overpayment was made. The Department shall take every step
12    to notify the benefit recipient of the overpayment and
13    shall make every effort to process and make the payment as
14    promptly as possible. The required payments under this
15    Section are retroactive for any previously made
16    overpayment that has not been paid out in accordance with
17    this Section for up to 7 years of past payments.
18    (f) Financing. Beginning July 1, 1995, all revenues arising
19from the administration of the health benefit programs
20established under Article 16 of the Illinois Pension Code or
21this Section shall be deposited into the Teacher Health
22Insurance Security Fund, which is hereby created as a
23nonappropriated trust fund to be held outside the State
24Treasury, with the State Treasurer as custodian. Any interest
25earned on moneys in the Teacher Health Insurance Security Fund
26shall be deposited into the Fund.

 

 

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1    Moneys in the Teacher Health Insurance Security Fund shall
2be used only to pay the costs of the health benefit program
3established under this Section, including associated
4administrative costs, and the costs associated with the health
5benefit program established under Article 16 of the Illinois
6Pension Code, as authorized in this Section. Beginning July 1,
71995, the Department of Central Management Services may make
8expenditures from the Teacher Health Insurance Security Fund
9for those costs.
10    After other funds authorized for the payment of the costs
11of the health benefit program established under Article 16 of
12the Illinois Pension Code are exhausted and until January 1,
131996 (or such later date as may be agreed upon by the Director
14of Central Management Services and the Secretary of the
15Teachers' Retirement System), the Secretary of the Teachers'
16Retirement System may make expenditures from the Teacher Health
17Insurance Security Fund as necessary to pay up to 75% of the
18cost of providing health coverage to eligible benefit
19recipients (as defined in Sections 16-153.1 and 16-153.3 of the
20Illinois Pension Code) who are enrolled in the Article 16
21health benefit program and to facilitate the transfer of
22administration of the health benefit program to the Department
23of Central Management Services.
24    The Department of Central Management Services, or any
25successor agency designated to procure healthcare contracts
26pursuant to this Act, is authorized to establish funds,

 

 

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1separate accounts provided by any bank or banks as defined by
2the Illinois Banking Act, or separate accounts provided by any
3savings and loan association or associations as defined by the
4Illinois Savings and Loan Act of 1985 to be held by the
5Director, outside the State treasury, for the purpose of
6receiving the transfer of moneys from the Teacher Health
7Insurance Security Fund. The Department may promulgate rules
8further defining the methodology for the transfers. Any
9interest earned by moneys in the funds or accounts shall inure
10to the Teacher Health Insurance Security Fund. The transferred
11moneys, and interest accrued thereon, shall be used exclusively
12for transfers to administrative service organizations or their
13financial institutions for payments of claims to claimants and
14providers under the self-insurance health plan. The
15transferred moneys, and interest accrued thereon, shall not be
16used for any other purpose including, but not limited to,
17reimbursement of administration fees due the administrative
18service organization pursuant to its contract or contracts with
19the Department.
20    (g) Contract for benefits. The Director shall by contract,
21self-insurance, or otherwise make available the program of
22health benefits for TRS benefit recipients and their TRS
23dependent beneficiaries that is provided for in this Section.
24The contract or other arrangement for the provision of these
25health benefits shall be on terms deemed by the Director to be
26in the best interest of the State of Illinois and the TRS

 

 

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1benefit recipients based on, but not limited to, such criteria
2as administrative cost, service capabilities of the carrier or
3other contractor, and the costs of the benefits.
4    (g-5) Committee. A Teacher Retirement Insurance Program
5Committee shall be established, to consist of 10 persons
6appointed by the Governor.
7    The Committee shall convene at least 4 times each year, and
8shall consider and make recommendations on issues affecting the
9program of health benefits provided under this Section.
10Recommendations of the Committee shall be based on a consensus
11of the members of the Committee.
12    If the Teacher Health Insurance Security Fund experiences a
13deficit balance based upon the contribution and subsidy rates
14established in this Section and Section 6.6 for Fiscal Year
152008 or thereafter, the Committee shall make recommendations
16for adjustments to the funding sources established under these
17Sections.
18    In addition, the Committee shall identify proposed
19solutions to the funding shortfalls that are affecting the
20Teacher Health Insurance Security Fund, and it shall report
21those solutions to the Governor and the General Assembly within
226 months after August 15, 2011 (the effective date of Public
23Act 97-386).
24    (h) Continuation of program. It is the intention of the
25General Assembly that the program of health benefits provided
26under this Section be maintained on an ongoing, affordable

 

 

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1basis.
2    The program of health benefits provided under this Section
3may be amended by the State and is not intended to be a pension
4or retirement benefit subject to protection under Article XIII,
5Section 5 of the Illinois Constitution.
6    (i) Repeal. (Blank).
7(Source: P.A. 100-1017, eff. 8-21-18; 101-483, eff. 1-1-20.)
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.