State of Illinois
91st General Assembly
Legislation

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91_HB1727

 
                                               LRB9103764MWtm

 1        AN  ACT  to amend the State Employees Group Insurance Act
 2    of 1971 by changing Section 10.

 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 10 as follows:

 7        (5 ILCS 375/10) (from Ch. 127, par. 530)
 8        Sec. 10. Payments by State; premiums.
 9        (a)  The   State   shall   pay   the   cost   of    basic
10    non-contributory  group life insurance and, subject to member
11    paid contributions set by the Department or required by  this
12    Section,  the  basic program of group health benefits on each
13    eligible member, except a member, not  otherwise  covered  by
14    this  Act,  who  has  retired as a participating member under
15    Article 2 of the Illinois Pension Code but is ineligible  for
16    the  retirement  annuity  under Section 2-119 of the Illinois
17    Pension Code, and part of each eligible member's and  retired
18    member's  premiums for health insurance coverage for enrolled
19    dependents as provided by Section 9.  The State shall pay the
20    cost of the basic program of group health benefits only after
21    benefits are reduced by the amount  of  benefits  covered  by
22    Medicare  for all retired members and retired dependents aged
23    65 years or older who are entitled to benefits  under  Social
24    Security  or  the  Railroad  Retirement  system  or  who  had
25    sufficient Medicare-covered government employment except that
26    such  reduction in benefits shall apply only to those retired
27    members or retired dependents who (1) first  become  eligible
28    for  such  Medicare coverage on or after July 1, 1992; or (2)
29    remain eligible for, but no longer receive Medicare  coverage
30    which  they  had been receiving on or after July 1, 1992. The
31    Department may determine the aggregate level of  the  State's
 
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 1    contribution  on the basis of actual cost of medical services
 2    adjusted for age, sex  or  geographic  or  other  demographic
 3    characteristics which affect the costs of such programs.
 4        (a-1)  Beginning  January  1,  1998,  for each person who
 5    becomes a new SERS annuitant and participates  in  the  basic
 6    program  of group health benefits, the State shall contribute
 7    toward the cost of the annuitant's coverage under  the  basic
 8    program  of  group  health  benefits an amount equal to 5% of
 9    that cost for each full year of creditable service upon which
10    the annuitant's retirement annuity is based, up to a  maximum
11    of  100% for an annuitant with 20 or more years of creditable
12    service.  The remainder of the cost of a new SERS annuitant's
13    coverage under the basic program  of  group  health  benefits
14    shall be the responsibility of the annuitant.
15        (a-2)  Beginning  January  1,  1998,  for each person who
16    becomes a new SERS survivor and  participates  in  the  basic
17    program  of group health benefits, the State shall contribute
18    toward the cost of the survivor's coverage  under  the  basic
19    program  of  group  health  benefits an amount equal to 5% of
20    that cost for each full year of the  deceased  employee's  or
21    deceased   annuitant's   creditable   service  in  the  State
22    Employees' Retirement System  of  Illinois  on  the  date  of
23    death,  up to a maximum of 100% for a survivor of an employee
24    or annuitant with 20 or more  years  of  creditable  service.
25    The remainder of the cost of the new SERS survivor's coverage
26    under the basic program of group health benefits shall be the
27    responsibility of the survivor.
28        (a-3)  Beginning  January  1,  1998,  for each person who
29    becomes a new SURS annuitant and participates  in  the  basic
30    program  of group health benefits, the State shall contribute
31    toward the cost of the annuitant's coverage under  the  basic
32    program  of  group  health  benefits an amount equal to 5% of
33    that cost for each full year of creditable service upon which
34    the annuitant's retirement annuity is based, up to a  maximum
 
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 1    of  100% for an annuitant with 20 or more years of creditable
 2    service.  The remainder of the cost of a new SURS annuitant's
 3    coverage under the basic program  of  group  health  benefits
 4    shall be the responsibility of the annuitant.
 5        (a-4)  Beginning  January  1,  1998,  for each person who
 6    becomes a new SURS retired employee and participates  in  the
 7    basic  program  of  group  health  benefits,  the State shall
 8    contribute toward the cost of the retired employee's coverage
 9    under the basic program of group health  benefits  an  amount
10    equal  to 5% of that cost for each full year that the retired
11    employee was an employee as defined in Section  3,  up  to  a
12    maximum  of  100%  for a retired employee who was an employee
13    for 20 or more years.  The remainder of the  cost  of  a  new
14    SURS  retired  employee's coverage under the basic program of
15    group health benefits shall  be  the  responsibility  of  the
16    retired employee.
17        (a-5)  Beginning  January  1,  1998,  for each person who
18    becomes a new SURS survivor and  participates  in  the  basic
19    program  of group health benefits, the State shall contribute
20    toward the cost of the survivor's coverage  under  the  basic
21    program  of  group  health  benefits an amount equal to 5% of
22    that cost for each full year of the  deceased  employee's  or
23    deceased   annuitant's   creditable   service  in  the  State
24    Universities Retirement System on the date of death, up to  a
25    maximum  of  100%  for a survivor of an employee or annuitant
26    with 20 or more years of creditable service.   The  remainder
27    of  the  cost  of  the new SURS survivor's coverage under the
28    basic  program  of  group  health  benefits  shall   be   the
29    responsibility of the survivor.
30        (a-6)  Beginning  July  1,  1998,  for  each  person  who
31    becomes  a  new  TRS  State annuitant and participates in the
32    basic program of  group  health  benefits,  the  State  shall
33    contribute  toward the cost of the annuitant's coverage under
34    the basic program of group health benefits an amount equal to
 
                            -4-                LRB9103764MWtm
 1    5% of that cost for each full year of creditable service as a
 2    teacher as defined in paragraph (2), (3), or (5)  of  Section
 3    16-106   of   the   Illinois  Pension  Code  upon  which  the
 4    annuitant's retirement annuity is based, up to a  maximum  of
 5    100%  for  an  annuitant  with  20  or  more  years  of  such
 6    creditable  service.   The remainder of the cost of a new TRS
 7    State annuitant's coverage under the basic program  of  group
 8    health benefits shall be the responsibility of the annuitant.
 9        (a-7)  Beginning  July  1,  1998,  for  each  person  who
10    becomes  a  new  TRS  State  survivor and participates in the
11    basic program of  group  health  benefits,  the  State  shall
12    contribute  toward  the cost of the survivor's coverage under
13    the basic program of group health benefits an amount equal to
14    5% of that cost for each full year of the deceased employee's
15    or deceased annuitant's creditable service as  a  teacher  as
16    defined  in  paragraph  (2), (3), or (5) of Section 16-106 of
17    the Illinois Pension Code on the  date  of  death,  up  to  a
18    maximum  of  100%  for a survivor of an employee or annuitant
19    with 20 or  more  years  of  such  creditable  service.   The
20    remainder  of  the  cost  of  the  new  TRS  State survivor's
21    coverage under the basic program  of  group  health  benefits
22    shall be the responsibility of the survivor.
23        (a-8)  A  new SERS annuitant, new SERS survivor, new SURS
24    annuitant, new SURS retired employee, new SURS survivor,  new
25    TRS  State  annuitant, or new TRS State survivor may waive or
26    terminate coverage in the program of group  health  benefits.
27    Any  such  annuitant,  survivor,  or retired employee who has
28    waived or terminated coverage may enroll or re-enroll in  the
29    program  of  group  health  benefits  only  during the annual
30    benefit choice period, as determined by the Director;  except
31    that   in  the  event  of  termination  of  coverage  due  to
32    nonpayment of premiums, the annuitant, survivor,  or  retired
33    employee may not re-enroll in the program.
34        (a-9)  No  later  than  May  1 of each calendar year, the
 
                            -5-                LRB9103764MWtm
 1    Director of Central  Management  Services  shall  certify  in
 2    writing  to  the  Executive Secretary of the State Employees'
 3    Retirement System of Illinois the  amounts  of  the  Medicare
 4    supplement health care premiums and the amounts of the health
 5    care  premiums  for  all  other retirees who are not Medicare
 6    eligible.
 7        A separate calculation of the  premiums  based  upon  the
 8    actual cost of each health care plan shall be so certified.
 9        The Director of Central Management Services shall provide
10    to the Executive Secretary of the State Employees' Retirement
11    System  of  Illinois  such information, statistics, and other
12    data as he or she may require to review the  premium  amounts
13    certified by the Director of Central Management Services.
14        (b)  State employees who become eligible for this program
15    on  or  after January 1, 1980 in positions normally requiring
16    actual performance of duty not less than 1/2 of a normal work
17    period but not equal to that of a normal work  period,  shall
18    be  given  the  option  of  participating  in  the  available
19    program.  If  the  employee  elects coverage, the State shall
20    contribute on behalf of such employee  to  the  cost  of  the
21    employee's  benefit  and any applicable dependent supplement,
22    that sum which bears the same percentage as  that  percentage
23    of  time the employee regularly works when compared to normal
24    work period.
25        (c)  The basic non-contributory coverage from  the  basic
26    program  of group health benefits shall be continued for each
27    employee not in pay status or on active service by reason  of
28    (1) leave of absence due to illness or injury, (2) authorized
29    educational  leave  of  absence  or  sabbatical leave, or (3)
30    military leave with pay and  benefits.  This  coverage  shall
31    continue  until  expiration of authorized leave and return to
32    active service, but not to exceed 24 months for leaves  under
33    item (1) or (2). This 24-month limitation and the requirement
34    of  returning  to  active  service shall not apply to persons
 
                            -6-                LRB9103764MWtm
 1    receiving  ordinary  or  accidental  disability  benefits  or
 2    retirement benefits through the appropriate State  retirement
 3    system   or  benefits  under  the  Workers'  Compensation  or
 4    Occupational Disease Act.
 5        (d)  The  basic  group  life  insurance  coverage   shall
 6    continue,  with full State contribution, where such person is
 7    (1) absent  from  active  service  by  reason  of  disability
 8    arising  from  any  cause  other  than self-inflicted, (2) on
 9    authorized educational leave of absence or sabbatical  leave,
10    or (3) on military leave with pay and benefits.
11        (e)  Where  the  person is in non-pay status for a period
12    in excess of 30 days or on leave of absence,  other  than  by
13    reason  of  disability,  educational  or sabbatical leave, or
14    military  leave  with  pay  and  benefits,  such  person  may
15    continue coverage only by making personal  payment  equal  to
16    the amount normally contributed by the State on such person's
17    behalf.  Such  payments  and  coverage  may be continued: (1)
18    until such time as the person returns to  a  status  eligible
19    for  coverage  at State expense, but not to exceed 24 months,
20    (2) until such person's employment or annuitant  status  with
21    the  State  is  terminated,  or (3) for a maximum period of 4
22    years for members on military leave with pay and benefits and
23    military leave without pay and  benefits  (exclusive  of  any
24    additional service imposed pursuant to law).
25        (f)  The  Department  shall  establish by rule the extent
26    to which other employee benefits will continue for persons in
27    non-pay status or who are not in active service.
28        (g)  The State shall  not  pay  the  cost  of  the  basic
29    non-contributory  group  life  insurance,  program  of health
30    benefits and other employee  benefits  for  members  who  are
31    survivors  as defined by paragraphs (1) and (2) of subsection
32    (q) of Section 3 of this Act.   The  costs  of  benefits  for
33    these  survivors  shall  be  paid  by the survivors or by the
34    University of Illinois Cooperative Extension Service, or  any
 
                            -7-                LRB9103764MWtm
 1    combination thereof.
 2        (h)  Those   persons   occupying   positions   with   any
 3    department  as a result of emergency appointments pursuant to
 4    Section 8b.8 of the Personnel Code  who  are  not  considered
 5    employees  under  this  Act  shall  be  given  the  option of
 6    participating in the programs of group life insurance, health
 7    benefits and other employee benefits.  Such persons  electing
 8    coverage  may participate only by making payment equal to the
 9    amount  normally  contributed  by  the  State  for  similarly
10    situated employees.  Such amounts shall be determined by  the
11    Director.   Such payments and coverage may be continued until
12    such time as the person becomes an employee pursuant to  this
13    Act or such person's appointment is terminated.
14        (i)  Any  unit  of  local  government within the State of
15    Illinois may apply to the Director  to  have  its  employees,
16    annuitants,   and  their  dependents  provided  group  health
17    coverage  under  this  Act  on  a  non-insured   basis.    To
18    participate,  a unit of local government must agree to enroll
19    all of its employees, who may select  coverage  under  either
20    the State group health insurance plan or a health maintenance
21    organization  that  has  contracted  with  the  State  to  be
22    available  as a health care provider for employees as defined
23    in this Act.  A unit  of  local  government  must  remit  the
24    entire  cost  of  providing  coverage  under  the State group
25    health  insurance  plan  or,  for  coverage  under  a  health
26    maintenance  organization,  an  amount  determined   by   the
27    Director  based  on  an  analysis of the sex, age, geographic
28    location, or other relevant  demographic  variables  for  its
29    employees, except that the unit of local government shall not
30    be  required to enroll those of its employees who are covered
31    spouses or dependents under this plan or another group policy
32    or  plan  providing  health  benefits  as  long  as  (1)   an
33    appropriate  official  from  the  unit  of  local  government
34    attests  that  each employee not enrolled is a covered spouse
 
                            -8-                LRB9103764MWtm
 1    or dependent under this plan or another group policy or plan,
 2    and (2) at least 85% of the employees are  enrolled  and  the
 3    unit  of local government remits the entire cost of providing
 4    coverage to those  employees,  except  that  a  participating
 5    school  district  must  have  enrolled  at  least  85% of its
 6    full-time employees who have not waived  coverage  under  the
 7    district's  group health plan by participating in a component
 8    of the district's  cafeteria  plan.  A  participating  school
 9    district  is  not required to enroll a full-time employee who
10    has  waived  coverage  under  the  district's  health   plan,
11    provided  that an appropriate official from the participating
12    school district  attests  that  the  full-time  employee  has
13    waived  coverage  by  participating  in  a  component  of the
14    district's  cafeteria  plan.   For  the  purposes   of   this
15    subsection,  "participating  school district" includes a unit
16    of local government whose primary  purpose  is  education  as
17    defined by the Department's rules.
18        Employees of a participating unit of local government who
19    are  not  enrolled due to coverage under another group health
20    policy or  plan  may  enroll  at  a  later  date  subject  to
21    submission  of  satisfactory  evidence  of  insurability  and
22    provided  that  no  benefits  shall  be  payable for services
23    incurred during the first 6 months of coverage to the  extent
24    the   services  are   in  connection  with  any  pre-existing
25    condition.  A participating unit of local government may also
26    elect to cover its annuitants.  Dependent coverage  shall  be
27    offered on an optional basis, with the costs paid by the unit
28    of  local  government,  its employees, or some combination of
29    the two as determined by the unit of local  government.   The
30    unit  of  local  government  shall  be responsible for timely
31    collection and transmission of dependent premiums.
32        The Director shall annually determine  monthly  rates  of
33    payment, subject to the following constraints:
34             (1)  In  the first year of coverage, the rates shall
 
                            -9-                LRB9103764MWtm
 1        be  equal  to  the  amount  normally  charged  to   State
 2        employees  for elected optional coverages or for enrolled
 3        dependents coverages or other contributory coverages,  or
 4        contributed by the State for basic insurance coverages on
 5        behalf of its employees, adjusted for differences between
 6        State  employees and employees of the local government in
 7        age,  sex,  geographic   location   or   other   relevant
 8        demographic  variables,  plus an amount sufficient to pay
 9        for the  additional  administrative  costs  of  providing
10        coverage to employees of the unit of local government and
11        their dependents.
12             (2)  In subsequent years, a further adjustment shall
13        be  made  to  reflect  the  actual  prior  years'  claims
14        experience   of  the  employees  of  the  unit  of  local
15        government.
16        In the case of coverage  of  local  government  employees
17    under  a  health maintenance organization, the Director shall
18    annually determine  for  each  participating  unit  of  local
19    government the maximum monthly amount the unit may contribute
20    toward  that  coverage,  based on an analysis of (i) the age,
21    sex, geographic  location,  and  other  relevant  demographic
22    variables  of the unit's employees and (ii) the cost to cover
23    those employees under the State group health insurance  plan.
24    The  Director  may  similarly  determine  the maximum monthly
25    amount each unit of local government  may  contribute  toward
26    coverage   of   its  employees'  dependents  under  a  health
27    maintenance organization.
28        Monthly payments by the unit of local government  or  its
29    employees  for  group  health insurance or health maintenance
30    organization  coverage  shall  be  deposited  in  the   Local
31    Government   Health   Insurance   Reserve  Fund.   The  Local
32    Government  Health  Insurance  Reserve  Fund   shall   be   a
33    continuing  fund not subject to fiscal year limitations.  All
34    expenditures from this fund shall be used  for  payments  for
 
                            -10-               LRB9103764MWtm
 1    health  care benefits for local government and rehabilitation
 2    facility  employees,  annuitants,  and  dependents,  and   to
 3    reimburse   the  Department  or  its  administrative  service
 4    organization for all expenses incurred in the  administration
 5    of  benefits.   No  other  State  funds may be used for these
 6    purposes.
 7        A local government employer's participation or desire  to
 8    participate  in a program created under this subsection shall
 9    not  limit  that  employer's  duty  to   bargain   with   the
10    representative  of  any  collective  bargaining  unit  of its
11    employees.
12        (j)  Any rehabilitation  facility  within  the  State  of
13    Illinois  may  apply  to  the Director to have its employees,
14    annuitants,  and  their  dependents  provided  group   health
15    coverage   under   this   Act  on  a  non-insured  basis.  To
16    participate, a rehabilitation facility must agree  to  enroll
17    all  of  its employees and remit the entire cost of providing
18    such  coverage   for   its   employees,   except   that   the
19    rehabilitation facility shall not be required to enroll those
20    of  its employees who are covered spouses or dependents under
21    this plan or another group policy or  plan  providing  health
22    benefits  as  long  as  (1)  an appropriate official from the
23    rehabilitation  facility  attests  that  each  employee   not
24    enrolled  is a covered spouse or dependent under this plan or
25    another group policy or plan, and (2) at  least  85%  of  the
26    employees are enrolled and the rehabilitation facility remits
27    the  entire  cost  of  providing coverage to those employees.
28    Employees of a participating rehabilitation facility who  are
29    not  enrolled  due  to  coverage  under  another group health
30    policy or  plan  may  enroll  at  a  later  date  subject  to
31    submission  of  satisfactory  evidence  of  insurability  and
32    provided  that  no  benefits  shall  be  payable for services
33    incurred during the first 6 months of coverage to the  extent
34    the   services   are  in  connection  with  any  pre-existing
 
                            -11-               LRB9103764MWtm
 1    condition. A participating rehabilitation facility  may  also
 2    elect  to  cover  its annuitants. Dependent coverage shall be
 3    offered on an optional basis, with  the  costs  paid  by  the
 4    rehabilitation  facility,  its employees, or some combination
 5    of the 2 as determined by the  rehabilitation  facility.  The
 6    rehabilitation  facility  shall  be  responsible  for  timely
 7    collection and transmission of dependent premiums.
 8        The  Director shall annually determine quarterly rates of
 9    payment, subject to the following constraints:
10             (1)  In the first year of coverage, the rates  shall
11        be   equal  to  the  amount  normally  charged  to  State
12        employees for elected optional coverages or for  enrolled
13        dependents  coverages  or other contributory coverages on
14        behalf of its employees, adjusted for differences between
15        State  employees  and  employees  of  the  rehabilitation
16        facility  in  age,  sex,  geographic  location  or  other
17        relevant demographic variables, plus an amount sufficient
18        to  pay  for  the  additional  administrative  costs   of
19        providing  coverage  to  employees  of the rehabilitation
20        facility and their dependents.
21             (2)  In subsequent years, a further adjustment shall
22        be  made  to  reflect  the  actual  prior  years'  claims
23        experience  of  the  employees  of   the   rehabilitation
24        facility.
25        Monthly  payments  by  the rehabilitation facility or its
26    employees for group health insurance shall  be  deposited  in
27    the Local Government Health Insurance Reserve Fund.
28        (k)  Any  domestic violence shelter or service within the
29    State of Illinois may apply  to  the  Director  to  have  its
30    employees,  annuitants,  and  their dependents provided group
31    health coverage under this Act on a  non-insured  basis.   To
32    participate,  a  domestic  violence  shelter  or service must
33    agree to enroll all of its employees and pay the entire  cost
34    of   providing   such   coverage   for   its   employees.   A
 
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 1    participating domestic violence shelter  may  also  elect  to
 2    cover its annuitants.  Dependent coverage shall be offered on
 3    an optional basis, with employees, or some combination of the
 4    2  as determined by the domestic violence shelter or service.
 5    The domestic violence shelter or service shall be responsible
 6    for timely collection and transmission of dependent premiums.
 7        The Director shall annually determine quarterly rates  of
 8    payment, subject to the following constraints:
 9             (1)  In  the first year of coverage, the rates shall
10        be  equal  to  the  amount  normally  charged  to   State
11        employees  for elected optional coverages or for enrolled
12        dependents coverages or other contributory  coverages  on
13        behalf of its employees, adjusted for differences between
14        State  employees  and  employees of the domestic violence
15        shelter or service in age, sex,  geographic  location  or
16        other  relevant  demographic  variables,  plus  an amount
17        sufficient to pay for the additional administrative costs
18        of  providing  coverage  to  employees  of  the  domestic
19        violence shelter or service and their dependents.
20             (2)  In subsequent years, a further adjustment shall
21        be  made  to  reflect  the  actual  prior  years'  claims
22        experience of the  employees  of  the  domestic  violence
23        shelter or service.
24             (3)  In  no  case  shall  the  rate be less than the
25        amount normally charged to State employees or contributed
26        by the State on behalf of its employees.
27        Monthly payments by  the  domestic  violence  shelter  or
28    service  or its employees for group health insurance shall be
29    deposited in the Local Government  Health  Insurance  Reserve
30    Fund.
31        (l)  A  public  community  college  or  entity  organized
32    pursuant to the Public Community College Act may apply to the
33    Director  initially to have only annuitants not covered prior
34    to July 1, 1992 by the district's health plan provided health
 
                            -13-               LRB9103764MWtm
 1    coverage  under  this  Act  on  a  non-insured  basis.    The
 2    community   college   must   execute  a  2-year  contract  to
 3    participate in  the  Local  Government  Health  Plan.   Those
 4    annuitants  enrolled initially under this contract shall have
 5    no benefits payable for services incurred during the first  6
 6    months  of  coverage  to  the  extent  the  services  are  in
 7    connection  with  any  pre-existing condition.  Any annuitant
 8    who may enroll after this initial enrollment period shall  be
 9    subject   to   submission   of   satisfactory   evidence   of
10    insurability and to the pre-existing conditions limitation.
11        The  Director  shall  annually determine monthly rates of
12    payment subject to  the  following  constraints:   for  those
13    community  colleges with annuitants only enrolled, first year
14    rates shall be equal to the average cost to cover claims  for
15    a   State   member   adjusted   for   demographics,  Medicare
16    participation, and other factors; and in the second  year,  a
17    further  adjustment  of  rates  shall  be made to reflect the
18    actual  first  year's  claims  experience  of   the   covered
19    annuitants.
20        (m)  The  Director shall adopt any rules deemed necessary
21    for implementation of this amendatory Act of 1989 (Public Act
22    86-978).
23    (Source:  P.A.  89-53,  eff.  7-1-95;  89-236,  eff.  8-4-95;
24    89-324,  eff.  8-13-95;  89-626,  eff.  8-9-96;  90-65,  eff.
25    7-7-97; 90-582, eff. 5-27-98; 90-655, eff.  7-30-98;  revised
26    8-3-98.)

27        Section  99.  Effective date.  This Act takes effect upon
28    becoming law.

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