AN
ACT Relating to health care benefits for retirees of local government
employers; reenacting and amending RCW 41.05.050; adding new sections to
chapter 41.04 RCW; creating a new section; and providing an effective date.
BE IT ENACTED BY THE
LEGISLATURE OF THE STATE OF WASHINGTON:
NEW
SECTION. Sec. 1. It is
the intent of this act to provide retirees of local government employers access
to health care benefits. It is also the intent of this act that local
government employers be allowed the flexibility to design programs to meet the
health care needs of their retirees and that the local government employer be
able to recover all costs associated with providing retirees access to health
benefits.
NEW
SECTION. Sec. 2. A
new section is added to chapter 41.04 RCW to read as follows:
(1)
Unless the context clearly requires otherwise, the definitions in this
subsection apply throughout this section.
(a)
"Disabled employee" means an individual eligible to receive a
disability retirement allowance from the public employees' retirement system.
(b)
"Health plan" means a contract, policy, fund, trust, or other program
established jointly or individually by a county, municipality, or other
political subdivision of the state that provides for all or a part of
hospitalization or medical aid for its employees and their dependents under RCW
41.04.180.
(c)
"Retired employee" means a public employee meeting the retirement
eligibility, years of service requirements, and other criteria set forth in the
public employees' retirement system.
(2)
A county, municipality, or other political subdivision that provides a health
plan for its employees shall permit retired and disabled employees and their
dependents to continue participation in a plan subject to the exceptions,
limitations, and conditions set forth in this section. However, this section
does not apply to a county, municipality, or other political subdivision
participating in an insurance program administered under chapter 41.05 RCW if
retired and disabled employees and their dependents of the participating
county, municipality, or other political subdivision are covered under an
insurance program administered under chapter 41.05 RCW. Nothing in this
subsection or this act precludes the local government employer from offering
retired or disabled employees a health plan with a benefit structure,
copayment, deductible, coinsurance, lifetime benefit maximum, and other plan
features which differ from those offered through a health plan provided to
active employees. Further, nothing in this subsection precludes a local
government employer from joining with other public agency employers, including
interjurisdictional benefit pools and multi-employer associations or
consortiums, to fulfill its obligations under this act.
(3)
A county, municipality, or other political subdivision has full authority to
require a person who requests continued participation in a health plan under
subsection (2) of this section to pay the full cost of such participation,
including any amounts necessary for administration. However, this subsection
does not require an employer who is currently paying for all or part of a
health plan for its retired and disabled employees to discontinue those
payments.
(4)
Payments for continued participation in a former employer's health plan may be
assigned to the underwriter of the health plan from public pension benefits or
may be paid to the former employer, as determined by the former employer, so
that an underwriter of the health plan that is an insurance company, health
care service contractor, or health maintenance organization is not required to
accept individual payments from persons continuing participation in the
employer's health plan.
(5)
After an initial open enrollment period of ninety days after the effective date
of this section, an employer may not be required to permit a person to continue
participation in the health plan if the person is responsible for a lapse in
coverage under the plan. In addition, an employer may not be required to
permit a person to continue participation in the employer's health plan if the
employer offered continued participation in a health plan that meets the
requirements of this act.
(6)
If a person continuing participation in the former employer's health plan has
medical coverage available through another employer, the medical coverage of
the other employer is the primary coverage for purposes of coordination of
benefits as provided for in the former employer's health plan.
(7)
If a person's continued participation in a health plan was permitted because of
the person's relationship to a retired or disabled employee of the employer
providing the health plan and the retired or disabled employee dies, then that
person is permitted to continue participation in the health plan for a period of
not more than six months after the death of the retired or disabled employee.
However, the employer providing the health plan may permit continued
participation beyond that time period.
(8)
An employer may offer one or more health plans different from that provided for
active employees and designed to meet the needs of persons requesting continued
participation in the employer's health plan. An employer, in designing or
offering continued participation in a health plan, may utilize terms or
conditions necessary to administer the plan to the extent the terms and
conditions do not conflict with this section.
(9)
If an employer changes the underwriter of a health plan, the replaced
underwriter has no further responsibility or obligation to persons who continued
participation in a health plan of the replaced underwriter. However, the
employer shall permit those persons to participate in any new health plan.
(10)
The benefits granted under this section are not considered a matter of
contractual right. Should the legislature, a county, municipality, or other
political subdivision of the state revoke or change any benefits granted under
this section, an affected person is not entitled to receive the benefits as a
matter of contractual right.
(11)
This section does not affect any health plan contained in a collective
bargaining agreement in existence as of the effective date of this section.
However, any plan contained in future collective bargaining agreements shall
conform to this section. In addition, this section does not affect any health
plan contract or policy in existence as of the effective date of this section.
However, any renewal of the contract or policy shall conform to this section.
NEW
SECTION. Sec. 3. A
new section is added to chapter 41.04 RCW to read as follows:
Employers
providing access to health insurance coverage under this act may adopt criteria
which specify allowable enrollment periods, require enrollees to keep current
addresses and information, and outline other processes to ensure that plans can
be administered efficiently and effectively.
Sec.
4. RCW
41.05.050 and 1995 1st sp.s. c 6 s 22 and 1994 c 153 s 4 are each reenacted and
amended to read as follows:
(1)
Every department, division, or separate agency of state government, and such
county, municipal, school district, educational service district, or other
political subdivisions as are covered by this chapter, shall provide
contributions to insurance and health care plans for its employees and their
dependents, the content of such plans to be determined by the authority.
Contributions, paid by the county, the municipality, school district,
educational service district, or other political subdivision for their
employees, shall include an amount determined by the authority to pay such
administrative expenses of the authority as are necessary to administer the
plans for employees of those groups. Until October 1, 1995, contributions to
be paid by school districts or educational service districts shall be adjusted
by the authority to reflect the remittance provided under RCW 28A.400.400.
(2)
If the authority at any time determines that the participation of a county,
municipal, or other political subdivision covered under this chapter adversely
impacts insurance rates for state employees, the authority shall implement
limitations on the participation of additional county, municipal, or other
political subdivisions.
(3)
The contributions of any department, division, or separate agency of the state
government, and such county, municipal, or other political subdivisions as are
covered by this chapter, shall be set by the authority, subject to the approval
of the governor for availability of funds as specifically appropriated by the
legislature for that purpose. Insurance and health care contributions for
ferry employees shall be governed by RCW 47.64.270.
(((3)))
(4) The authority shall transmit a recommendation for the amount of the
employer contribution to the governor and the director of financial management
for inclusion in the proposed budgets submitted to the legislature.
NEW SECTION. Sec. 5. This
act takes effect January 1, 2003. However, if a political subdivision is
unable to structure a health plan to meet the requirements of this act by
January 1, 2003, additional time of up to one year is allowed. All political
subdivisions must implement this act by January 1, 2004.
