SF 1390

1st Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to state employees; modifying state employee
group insurance plan provisions; amending Minnesota
Statutes 2004, sections 43A.23, subdivision 1; 43A.24,
subdivision 2; 43A.27, subdivision 3; 471.999.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2004, section 43A.23,
subdivision 1, is amended to read:

Subdivision 1.

General.

The commissioner is authorized
to request bids deleted text begin from carriers or to negotiate with carriers deleted text end and
to enter into contracts with deleted text begin carriers deleted text end new text begin parties new text end which in the
judgment of the commissioner are best qualified to deleted text begin underwrite
and deleted text end new text begin provide new text end service new text begin to new text end the benefit plans. Contracts entered
into deleted text begin with carriers deleted text end are not subject to the requirements of
sections 16C.16 to 16C.19. The commissioner may negotiate
premium rates and coverage deleted text begin provisions with all carriers licensed
under chapters 62A, 62C, and 62D. The commissioner may also
negotiate reasonable restrictions to be applied to all carriers
under chapters 62A, 62C, and 62D deleted text end . Contracts to underwrite the
benefit plans must be bid or negotiated separately from
contracts to service the benefit plans, which may be awarded
only on the basis of competitive bids. The commissioner shall
consider the cost of the plans, conversion options relating to
the contracts, service capabilities, character, financial
position, and reputation of the carriers, and any other factors
which the commissioner deems appropriate. Each benefit contract
must be for a uniform term of at least one year, but may be made
automatically renewable from term to term in the absence of
notice of termination by either party. deleted text begin The commissioner shall,
to the extent feasible, make hospital and medical benefits
available from at least one carrier licensed to do business
pursuant to each of chapters 62A, 62C, and 62D. The
commissioner need not provide health maintenance organization
services to an employee who resides in an area which is not
served by a licensed health maintenance organization. The
commissioner may refuse to allow a health maintenance
organization to continue as a carrier. The commissioner may
elect not to offer all three types of carriers if there are no
bids or no acceptable bids by that type of carrier or if the
offering of additional carriers would result in substantial
additional administrative costs. deleted text end A carrier licensed under
chapter 62A is exempt from the taxes imposed by chapter 297I on
premiums paid to it by the state.

All self-insured hospital and medical service products must
comply with coverage mandates, data reporting, and consumer
protection requirements applicable to the licensed carrier
administering the product, had the product been insured,
including chapters 62J, 62M, and 62Q. Any self-insured products
that limit coverage to a network of providers or provide
different levels of coverage between network and nonnetwork
providers shall comply with section 62D.123 and geographic
access standards for health maintenance organizations adopted by
the commissioner of health in rule under chapter 62D.

Sec. 2.

Minnesota Statutes 2004, section 43A.24,
subdivision 2, is amended to read:

Subd. 2.

Other eligible persons.

The following persons
are eligible for state paid life insurance and hospital,
medical, and dental benefits as determined in applicable
collective bargaining agreements or by the commissioner or by
plans pursuant to section 43A.18, subdivision 6, or by the Board
of Regents for employees of the University of Minnesota not
covered by collective bargaining agreements. Coverages made
available, including optional coverages, are as contained in the
plan established pursuant to section 43A.18, subdivision 2:

(a) a member of the state legislature, provided that
changes in benefits resulting in increased costs to the state
shall not be effective until expiration of the term of the
members of the existing house of representatives. An eligible
member of the state legislature may decline to be enrolled for
state paid coverages by filing a written waiver with the
commissioner. The waiver shall not prohibit the member from
enrolling the member or dependents for optional coverages,
without cost to the state, as provided for in section 43A.26. A
member of the state legislature who returns from a leave of
absence to a position previously occupied in the civil service
shall be eligible to receive the life insurance and hospital,
medical, and dental benefits to which the position is entitled;

(b) an employee of the legislature or an employee of a
permanent study or interim committee or commission or a state
employee on leave of absence to work for the legislature, during
a regular or special legislative session, as determined by the
Legislative Coordinating Commission;

(c) a judge of the appellate courts or an officer or
employee of these courts; a judge of the district court, a judge
of county court, or a judge of county municipal court; a
district court referee, judicial officer, court reporter, or law
clerk; a district administrator; an employee of the Office of
the District Administrator that is not in the Second or Fourth
Judicial District; a court administrator or employee of the
court administrator in a judicial district under section
480.181, subdivision 1, paragraph (b), and a guardian ad litem
program employee;

(d) a salaried employee of the Public Employees Retirement
Association;

(e) a full-time military or civilian officer or employee in
the unclassified service of the Department of Military Affairs
whose salary is paid from state funds;

(f) a salaried employee of the Minnesota Historical
Society, whether paid from state funds or otherwise, who is not
a member of the governing board;

(g) an employee of the regents of the University of
Minnesota;

(h) deleted text begin notwithstanding section 43A.27, subdivision 3, an
employee of the state of Minnesota or the regents of the
University of Minnesota who is at least 60 and not yet 65 years
of age on July 1, 1982, who is otherwise eligible for employee
and dependent insurance and benefits pursuant to section 43A.18
or other law, who has at least 20 years of service and retires,
earlier than required, within 60 days of March 23, 1982; or an
employee who is at least 60 and not yet 65 years of age on July
1, 1982, who has at least 20 years of state service and retires,
earlier than required, from employment at Rochester state
hospital after July 1, 1981; or an employee who is at least 55
and not yet 65 years of age on July 1, 1982, and is covered by
the Minnesota State Retirement System correctional employee
retirement plan or the State Patrol retirement fund, who has at
least 20 years of state service and retires, earlier than
required, within 60 days of March 23, 1982. For purposes of
this clause, a person retires when the person terminates active
employment in state or University of Minnesota service and
applies for a retirement annuity. Eligibility shall cease when
the retired employee attains the age of 65, or when the employee
chooses not to receive the annuity that the employee has applied
for. The retired employee shall be eligible for coverages to
which the employee was entitled at the time of retirement,
subject to any changes in coverage through collective bargaining
or plans established pursuant to section 43A.18, for employees
in positions equivalent to that from which retired, provided
that the retired employee shall not be eligible for state-paid
life insurance. Coverages shall be coordinated with relevant
health insurance benefits provided through the federally
sponsored Medicare program;
deleted text end

deleted text begin (i) deleted text end an employee of an agency of the state of Minnesota
identified through the process provided in this paragraph who is
eligible to retire prior to age 65. The commissioner and the
exclusive representative of state employees shall enter into
agreements under section 179A.22 to identify employees whose
positions are in programs that are being permanently eliminated
or reduced due to federal or state policies or practices.
Failure to reach agreement identifying these employees is not
subject to impasse procedures provided in chapter 179A. The
commissioner must prepare a plan identifying eligible employees
not covered by a collective bargaining agreement in accordance
with the process outlined in section 43A.18, subdivisions 2 and
3. For purposes of this paragraph, a person retires when the
person terminates active employment in state service and applies
for a retirement annuity. Eligibility ends as provided in the
agreement or plan, but must cease at the end of the month in
which the retired employee chooses not to receive an annuity, or
the employee is eligible for employer-paid health insurance from
a new employer. The retired employees shall be eligible for
coverages to which they were entitled at the time of retirement,
subject to any changes in coverage through collective bargaining
or plans established under section 43A.18 for employees in
positions equivalent to that from which they retired, provided
that the retired employees shall not be eligible for state-paid
life insurance;

deleted text begin (j) deleted text end new text begin (i) new text end employees of the state Board of Public Defense,
with eligibility determined by the state Board of Public Defense
in consultation with the commissioner of employee relations; and

deleted text begin (k) deleted text end new text begin (j) new text end employees of supporting organizations of Minnesota
Technology, Inc., established after July 1, 2003, under section
116O.05, subdivision 4, as paid for by the supporting
organization.

Sec. 3.

Minnesota Statutes 2004, section 43A.27,
subdivision 3, is amended to read:

Subd. 3.

Retired employees.

(a) A person may elect to
purchase at personal expense individual and dependent hospital,
medical, and dental coverages if the person is:

(1) a retired employee of the state or an organization
listed in subdivision 2 or section 43A.24, subdivision 2, who,
at separation of service:

(i) is immediately eligible to receive a retirement benefit
under chapter 354B or an annuity under a retirement program
sponsored by the state or such organization of the state;

(ii) immediately meets the age and service requirements in
section 352.115, subdivision 1; and

(iii) has five years of service or meets the service
requirement of the collective bargaining agreement or plan,
whichever is greater; or

(2) a retired employee of the state who is at least 50
years of age and has at least 15 years of state service.

(b) The commissioner deleted text begin shall deleted text end new text begin may new text end offer at least one plan
which is actuarially equivalent to those made available through
collective bargaining agreements or plans established under
section 43A.18 to employees in positions equivalent to that from
which retired.

(c) A spouse of a person eligible under paragraph (a) may
purchase the coverage listed in this subdivision if the spouse
was a dependent under the retired employee's coverage at the
time of the retiree's death.

(d) Coverages must be coordinated with relevant health
insurance benefits provided through the federally sponsored
Medicare program. Until the retired employee reaches age 65,
the retired employee and dependents must be pooled in the same
group as active employees for purposes of establishing premiums
and coverage for hospital, medical, and dental insurance.
Coverage for retired employees and their dependents may not
discriminate on the basis of evidence of insurability or
preexisting conditions unless identical conditions are imposed
on active employees in the group that the employee left.
Appointing authorities shall provide notice to employees no
later than the effective date of their retirement of the right
to exercise the option provided in this subdivision. The
retired employee must notify the commissioner or designee of the
commissioner within 30 days after the effective date of the
retirement of intent to exercise this option.

Sec. 4.

Minnesota Statutes 2004, section 471.999, is
amended to read:

471.999 REPORT TO LEGISLATURE.

The commissioner of employee relations shall report to the
legislature by January 1 of each year on the status of
compliance with section 471.992, subdivision 1, by governmental
subdivisions.

The report must include a list of the political
subdivisions in compliance with section 471.992, subdivision 1,
and the estimated cost of compliance. The report must also
include a list of political subdivisions found by the
commissioner to be not in compliance, the basis for that
finding, recommended changes to achieve compliance, estimated
cost of compliance, and recommended penalties, if any. The
commissioner's report must include a list of subdivisions that
did not comply with the reporting requirements of this section.
The commissioner may request, and a subdivision shall provide,
any additional information needed for the preparation of a
report under this subdivision.

Notwithstanding any rule to the contrary, beginning in
2005, a political subdivision must report on its compliance with
the requirements of sections 471.991 to 471.999 no more
frequently than once every deleted text begin five deleted text end new text begin three new text end years. No report from a
political subdivision is required for 2003 and 2004.