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90_HB0347
5 ILCS 375/6.5
Amends the State Employees Group Insurance Act of 1971.
Provides for the termination of the separate program of
health benefits established for retired downstate teachers
and their dependent beneficiaries and moves those persons
into the State health plan. Effective immediately.
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1 AN ACT to amend the State Employees Group Insurance Act
2 of 1971 by changing Section 6.5.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The State Employees Group Insurance Act of
6 1971 is amended by changing Section 6.5 as follows:
7 (5 ILCS 375/6.5)
8 Sec. 6.5. Health benefits for TRS benefit recipients and
9 TRS dependent beneficiaries.
10 (A) Transfer to State health plan.
11 (a) Definitions. For the purposes of this Section and
12 Section 6.6:
13 "State health plan" means the program of health benefits
14 provided for annuitants and survivors under the other
15 Sections of this Act. The term does not include group life
16 insurance benefits.
17 "TRS health plan" means the separate program of health
18 benefits established under subsection (B) of this Section for
19 TRS benefit recipients and TRS dependent beneficiaries.
20 (b) Purpose. It is the purpose of this amendatory Act
21 of 1997 to provide for the termination of the separate
22 program of health benefits established under subsection (B)
23 of this Section for TRS benefit recipients and TRS dependent
24 beneficiaries and to move those persons into the State health
25 plan.
26 (c) Transfer. Upon expiration of the contract currently
27 providing for the separate program of health benefits
28 established under subsection (B) of this Section for TRS
29 benefit recipients and TRS dependent beneficiaries, but in no
30 event later than July 1, 1999, the separate program of health
31 benefits established under subsection (B) shall be
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1 terminated. All TRS benefit recipients and TRS dependent
2 beneficiaries participating in the TRS health plan on the
3 termination date shall be transferred on that date into the
4 State health plan without any interruption or delay in
5 coverage or limitation as to pre-existing medical conditions,
6 and all TRS benefit recipients and TRS dependent
7 beneficiaries shall thereafter be eligible to participate in
8 the State health plan on the same terms and subject to the
9 same benefits and costs as annuitants and survivors,
10 respectively.
11 The Department of Central Management Services shall
12 continue to administer the TRS health plan established under
13 subsection (B) until that plan has been terminated and all
14 claims under that plan have been resolved.
15 (d) Financing. To the extent that moneys are available
16 in that Fund, the Department of Central Management Services
17 shall pay the costs arising from the participation of TRS
18 benefit recipients and TRS dependent beneficiaries in the
19 State health plan from the Teacher Health Insurance Security
20 Fund, which is the nonappropriated interest-bearing trust
21 fund held outside the State Treasury with the State Treasurer
22 as custodian that is created in subsection (B).
23 The transfer of TRS benefit recipients and TRS dependent
24 beneficiaries from the separate TRS health plan to the State
25 health plan does not affect the payment of contributions into
26 the Fund under Section 6.6 of this Act or Section 1.3 of the
27 State Pension Funds Continuing Appropriation Act.
28 (B) TRS health plan.
29 (a) Purpose. It is the purpose of this amendatory Act
30 of 1995 to transfer the administration of the program of
31 health benefits established for benefit recipients and their
32 dependent beneficiaries under Article 16 of the Illinois
33 Pension Code to the Department of Central Management
34 Services.
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1 (b) Transition provisions. The Board of Trustees of the
2 Teachers' Retirement System shall continue to administer the
3 health benefit program established under Article 16 of the
4 Illinois Pension Code through December 31, 1995. Beginning
5 January 1, 1996, the Department of Central Management
6 Services shall be responsible for administering a program of
7 health benefits for TRS benefit recipients and TRS dependent
8 beneficiaries under this subsection (B) Section. The
9 Department of Central Management Services and the Teachers'
10 Retirement System shall cooperate in this endeavor and shall
11 coordinate their activities so as to ensure a smooth
12 transition and uninterrupted health benefit coverage.
13 (c) Eligibility. All persons who were enrolled in the
14 Article 16 program at the time of the transfer shall be
15 eligible to participate in the program established under this
16 subsection (B) Section without any interruption or delay in
17 coverage or limitation as to pre-existing medical conditions.
18 Eligibility to participate shall be determined by the
19 Teachers' Retirement System. Eligibility information shall
20 be communicated to the Department of Central Management
21 Services in a format acceptable to the Department.
22 (d) Coverage. The level of health benefits provided
23 under this subsection (B) Section shall be similar to the
24 level of benefits provided by the program previously
25 established under Article 16 of the Illinois Pension Code.
26 Group life insurance benefits are not included in the
27 benefits to be provided to TRS benefit recipients and TRS
28 dependent beneficiaries under this Act.
29 The program of health benefits under this subsection (B)
30 Section may include any or all of the benefit limitations,
31 including but not limited to a reduction in benefits based on
32 eligibility for federal medicare benefits, that are provided
33 under subsection (a) of Section 6 of this Act for other
34 health benefit programs under this Act.
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1 (e) Insurance rates and premiums. The Director shall
2 determine the insurance rates and premiums for TRS benefit
3 recipients and TRS dependent beneficiaries under this
4 subsection (B). For Fiscal Year 1996, the premium shall be
5 equal to the premium actually charged in Fiscal Year 1995.
6 In subsequent years, the premium under this subsection (B)
7 shall never be lower than the premium charged in Fiscal Year
8 1995. Rates and premiums may be based in part on age and
9 eligibility for federal medicare coverage.
10 The cost of health benefits under the program shall be
11 paid as follows:
12 (1) For a TRS benefit recipient selecting a managed
13 care program, up to 75% of the total insurance rate shall
14 be paid from the Teacher Health Insurance Security Fund.
15 (2) For a TRS benefit recipient selecting the major
16 medical coverage program, up to 50% of the total
17 insurance rate shall be paid from the Teacher Health
18 Insurance Security Fund if a managed care program is
19 accessible, as determined by the Teachers' Retirement
20 System.
21 (3) For a TRS benefit recipient selecting the major
22 medical coverage program, up to 75% of the total
23 insurance rate shall be paid from the Teacher Health
24 Insurance Security Fund if a managed care program is not
25 accessible, as determined by the Teachers' Retirement
26 System.
27 (4) The balance of the rate of insurance, including
28 the entire premium of any coverage for TRS dependent
29 beneficiaries that has been elected, shall be paid by
30 deductions authorized by the TRS benefit recipient to be
31 withheld from his or her monthly annuity or benefit
32 payment from the Teachers' Retirement System; except that
33 (i) if the balance of the cost of coverage exceeds the
34 amount of the monthly annuity or benefit payment, the
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1 difference shall be paid directly to the Teachers'
2 Retirement System by the TRS benefit recipient, and (ii)
3 all or part of the balance of the cost of coverage may,
4 at the school board's option, be paid to the Teachers'
5 Retirement System by the school board of the school
6 district from which the TRS benefit recipient retired, in
7 accordance with Section 10-22.3b of the School Code. The
8 Teachers' Retirement System shall promptly deposit all
9 moneys withheld by or paid to it under this subdivision
10 (e)(4) into the Teacher Health Insurance Security Fund.
11 These moneys shall not be considered assets of the
12 Retirement System.
13 (f) Financing. Beginning July 1, 1995, all revenues
14 arising from the administration of the health benefit
15 programs established under Article 16 of the Illinois Pension
16 Code or this subsection (B) Section shall be deposited into
17 the Teacher Health Insurance Security Fund, which is hereby
18 created as a nonappropriated trust fund to be held outside
19 the State Treasury, with the State Treasurer as custodian.
20 Any interest earned on moneys in the Teacher Health Insurance
21 Security Fund shall be deposited into the Fund.
22 Moneys in the Teacher Health Insurance Security Fund
23 shall be used only to pay the costs of (1) the health benefit
24 program established under this subsection (B) Section,
25 including associated administrative costs, (2) and the costs
26 associated with the health benefit program established under
27 Article 16 of the Illinois Pension Code, as authorized in
28 this Section, and (3) the costs of participation by TRS
29 benefit recipients and TRS dependent beneficiaries in the
30 State health plan. Beginning July 1, 1995, the Department of
31 Central Management Services may make expenditures from the
32 Teacher Health Insurance Security Fund for those costs.
33 After other funds authorized for the payment of the costs
34 of the health benefit program established under Article 16 of
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1 the Illinois Pension Code are exhausted and until January 1,
2 1996 (or such later date as may be agreed upon by the
3 Director of Central Management Services and the Secretary of
4 the Teachers' Retirement System), the Secretary of the
5 Teachers' Retirement System may make expenditures from the
6 Teacher Health Insurance Security Fund as necessary to pay up
7 to 75% of the cost of providing health coverage to eligible
8 benefit recipients (as defined in Sections 16-153.1 and
9 16-153.3 of the Illinois Pension Code) who are enrolled in
10 the Article 16 health benefit program and to facilitate the
11 transfer of administration of the health benefit program to
12 the Department of Central Management Services.
13 (g) Contract for benefits. The Director shall by
14 contract, self-insurance, or otherwise make available the
15 program of health benefits for TRS benefit recipients and
16 their TRS dependent beneficiaries that is provided for in
17 this subsection (B) Section. The contract or other
18 arrangement for the provision of these health benefits shall
19 be on terms deemed by the Director to be in the best interest
20 of the State of Illinois and the TRS benefit recipients based
21 on, but not limited to, such criteria as administrative cost,
22 service capabilities of the carrier or other contractor, and
23 the costs of the benefits.
24 (h) Nature Continuation of program. It is the intention
25 of the General Assembly that the program of health benefits
26 provided under this Section be maintained on an ongoing,
27 affordable basis. The program of health benefits provided
28 under this Section may be amended by the State and is not
29 intended to be a pension or retirement benefit subject to
30 protection under Article XIII, Section 5 of the Illinois
31 Constitution.
32 (Source: P.A. 89-21, eff. 6-21-95; 89-25, eff. 6-21-95.)
33 Section 99. Effective date. This Act takes effect upon
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1 becoming law.