101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3004

 

Introduced 2/5/2020, by Sen. Christopher Belt

 

SYNOPSIS AS INTRODUCED:
 
5 ILCS 375/10  from Ch. 127, par. 530

    Amends the State Employees Group Insurance Act of 1971. Provides that an annuitant, survivor, or retired employee whose coverage has been been terminated for nonpayment of premiums may re-enroll in the program during the next annual benefit choice period if he or she has fully paid all previous nonpayments prior to that re-enrollment. Provides that the changes added by this amendatory Act are inoperative on and after January 1, 2022. Makes conforming changes. Effective immediately.


LRB101 19096 RJF 68556 b

 

 

A BILL FOR

 

SB3004LRB101 19096 RJF 68556 b

1    AN ACT concerning State health benefits.
 
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 10 as follows:
 
6    (5 ILCS 375/10)  (from Ch. 127, par. 530)
7    Sec. 10. Contributions by the State and members.
8    (a) The State shall pay the cost of basic non-contributory
9group life insurance and, subject to member paid contributions
10set by the Department or required by this Section and except as
11provided in this Section, the basic program of group health
12benefits on each eligible member, except a member, not
13otherwise covered by this Act, who has retired as a
14participating member under Article 2 of the Illinois Pension
15Code but is ineligible for the retirement annuity under Section
162-119 of the Illinois Pension Code, and part of each eligible
17member's and retired member's premiums for health insurance
18coverage for enrolled dependents as provided by Section 9. The
19State shall pay the cost of the basic program of group health
20benefits only after benefits are reduced by the amount of
21benefits covered by Medicare for all members and dependents who
22are eligible for benefits under Social Security or the Railroad
23Retirement system or who had sufficient Medicare-covered

 

 

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1government employment, except that such reduction in benefits
2shall apply only to those members and dependents who (1) first
3become eligible for such Medicare coverage on or after July 1,
41992; or (2) are Medicare-eligible members or dependents of a
5local government unit which began participation in the program
6on or after July 1, 1992; or (3) remain eligible for, but no
7longer receive Medicare coverage which they had been receiving
8on or after July 1, 1992. The Department may determine the
9aggregate level of the State's contribution on the basis of
10actual cost of medical services adjusted for age, sex or
11geographic or other demographic characteristics which affect
12the costs of such programs.
13    The cost of participation in the basic program of group
14health benefits for the dependent or survivor of a living or
15deceased retired employee who was formerly employed by the
16University of Illinois in the Cooperative Extension Service and
17would be an annuitant but for the fact that he or she was made
18ineligible to participate in the State Universities Retirement
19System by clause (4) of subsection (a) of Section 15-107 of the
20Illinois Pension Code shall not be greater than the cost of
21participation that would otherwise apply to that dependent or
22survivor if he or she were the dependent or survivor of an
23annuitant under the State Universities Retirement System.
24    (a-1) (Blank).
25    (a-2) (Blank).
26    (a-3) (Blank).

 

 

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1    (a-4) (Blank).
2    (a-5) (Blank).
3    (a-6) (Blank).
4    (a-7) (Blank).
5    (a-8) Any annuitant, survivor, or retired employee may
6waive or terminate coverage in the program of group health
7benefits. Any such annuitant, survivor, or retired employee who
8has waived or terminated coverage may enroll or re-enroll in
9the program of group health benefits only during the annual
10benefit choice period, as determined by the Director. In ;
11except that in the event of termination of coverage due to
12nonpayment of premiums, the annuitant, survivor, or retired
13employee may not re-enroll in the program, except as otherwise
14provided in this subsection (a-8). Beginning on the effective
15date of this amendatory Act of the 101st General Assembly, an
16annuitant, survivor, or retired employee whose coverage has
17been terminated for nonpayment of premiums may re-enroll in the
18program during the next annual benefit choice period, as
19determined by the Director, if he or she has fully paid all
20previous nonpayments prior to that re-enrollment. The changes
21added to this subsection (a-8) by this amendatory Act of the
22101st General Assembly are inoperative on and after January 1,
232022.
24    (a-8.5) Beginning on the effective date of this amendatory
25Act of the 97th General Assembly, the Director of Central
26Management Services shall, on an annual basis, determine the

 

 

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1amount that the State shall contribute toward the basic program
2of group health benefits on behalf of annuitants (including
3individuals who (i) participated in the General Assembly
4Retirement System, the State Employees' Retirement System of
5Illinois, the State Universities Retirement System, the
6Teachers' Retirement System of the State of Illinois, or the
7Judges Retirement System of Illinois and (ii) qualify as
8annuitants under subsection (b) of Section 3 of this Act),
9survivors (including individuals who (i) receive an annuity as
10a survivor of an individual who participated in the General
11Assembly Retirement System, the State Employees' Retirement
12System of Illinois, the State Universities Retirement System,
13the Teachers' Retirement System of the State of Illinois, or
14the Judges Retirement System of Illinois and (ii) qualify as
15survivors under subsection (q) of Section 3 of this Act), and
16retired employees (as defined in subsection (p) of Section 3 of
17this Act). The remainder of the cost of coverage for each
18annuitant, survivor, or retired employee, as determined by the
19Director of Central Management Services, shall be the
20responsibility of that annuitant, survivor, or retired
21employee.
22    Contributions required of annuitants, survivors, and
23retired employees shall be the same for all retirement systems
24and shall also be based on whether an individual has made an
25election under Section 15-135.1 of the Illinois Pension Code.
26Contributions may be based on annuitants', survivors', or

 

 

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1retired employees' Medicare eligibility, but may not be based
2on Social Security eligibility.
3    (a-9) No later than May 1 of each calendar year, the
4Director of Central Management Services shall certify in
5writing to the Executive Secretary of the State Employees'
6Retirement System of Illinois the amounts of the Medicare
7supplement health care premiums and the amounts of the health
8care premiums for all other retirees who are not Medicare
9eligible.
10    A separate calculation of the premiums based upon the
11actual cost of each health care plan shall be so certified.
12    The Director of Central Management Services shall provide
13to the Executive Secretary of the State Employees' Retirement
14System of Illinois such information, statistics, and other data
15as he or she may require to review the premium amounts
16certified by the Director of Central Management Services.
17    The Department of Central Management Services, or any
18successor agency designated to procure healthcare contracts
19pursuant to this Act, is authorized to establish funds,
20separate accounts provided by any bank or banks as defined by
21the Illinois Banking Act, or separate accounts provided by any
22savings and loan association or associations as defined by the
23Illinois Savings and Loan Act of 1985 to be held by the
24Director, outside the State treasury, for the purpose of
25receiving the transfer of moneys from the Local Government
26Health Insurance Reserve Fund. The Department may promulgate

 

 

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1rules further defining the methodology for the transfers. Any
2interest earned by moneys in the funds or accounts shall inure
3to the Local Government Health Insurance Reserve Fund. The
4transferred moneys, and interest accrued thereon, shall be used
5exclusively for transfers to administrative service
6organizations or their financial institutions for payments of
7claims to claimants and providers under the self-insurance
8health plan. The transferred moneys, and interest accrued
9thereon, shall not be used for any other purpose including, but
10not limited to, reimbursement of administration fees due the
11administrative service organization pursuant to its contract
12or contracts with the Department.
13    (a-10) To the extent that participation, benefits, or
14premiums under this Act are based on a person's service credit
15under an Article of the Illinois Pension Code, service credit
16terminated in exchange for an accelerated pension benefit
17payment under Section 14-147.5, 15-185.5, or 16-190.5 of that
18Code shall be included in determining a person's service credit
19for the purposes of this Act.
20    (b) State employees who become eligible for this program on
21or after January 1, 1980 in positions normally requiring actual
22performance of duty not less than 1/2 of a normal work period
23but not equal to that of a normal work period, shall be given
24the option of participating in the available program. If the
25employee elects coverage, the State shall contribute on behalf
26of such employee to the cost of the employee's benefit and any

 

 

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1applicable dependent supplement, that sum which bears the same
2percentage as that percentage of time the employee regularly
3works when compared to normal work period.
4    (c) The basic non-contributory coverage from the basic
5program of group health benefits shall be continued for each
6employee not in pay status or on active service by reason of
7(1) leave of absence due to illness or injury, (2) authorized
8educational leave of absence or sabbatical leave, or (3)
9military leave. This coverage shall continue until expiration
10of authorized leave and return to active service, but not to
11exceed 24 months for leaves under item (1) or (2). This
1224-month limitation and the requirement of returning to active
13service shall not apply to persons receiving ordinary or
14accidental disability benefits or retirement benefits through
15the appropriate State retirement system or benefits under the
16Workers' Compensation or Occupational Disease Act.
17    (d) The basic group life insurance coverage shall continue,
18with full State contribution, where such person is (1) absent
19from active service by reason of disability arising from any
20cause other than self-inflicted, (2) on authorized educational
21leave of absence or sabbatical leave, or (3) on military leave.
22    (e) Where the person is in non-pay status for a period in
23excess of 30 days or on leave of absence, other than by reason
24of disability, educational or sabbatical leave, or military
25leave, such person may continue coverage only by making
26personal payment equal to the amount normally contributed by

 

 

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1the State on such person's behalf. Such payments and coverage
2may be continued: (1) until such time as the person returns to
3a status eligible for coverage at State expense, but not to
4exceed 24 months or (2) until such person's employment or
5annuitant status with the State is terminated (exclusive of any
6additional service imposed pursuant to law).
7    (f) The Department shall establish by rule the extent to
8which other employee benefits will continue for persons in
9non-pay status or who are not in active service.
10    (g) The State shall not pay the cost of the basic
11non-contributory group life insurance, program of health
12benefits and other employee benefits for members who are
13survivors as defined by paragraphs (1) and (2) of subsection
14(q) of Section 3 of this Act. The costs of benefits for these
15survivors shall be paid by the survivors or by the University
16of Illinois Cooperative Extension Service, or any combination
17thereof. However, the State shall pay the amount of the
18reduction in the cost of participation, if any, resulting from
19the amendment to subsection (a) made by this amendatory Act of
20the 91st General Assembly.
21    (h) Those persons occupying positions with any department
22as a result of emergency appointments pursuant to Section 8b.8
23of the Personnel Code who are not considered employees under
24this Act shall be given the option of participating in the
25programs of group life insurance, health benefits and other
26employee benefits. Such persons electing coverage may

 

 

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1participate only by making payment equal to the amount normally
2contributed by the State for similarly situated employees. Such
3amounts shall be determined by the Director. Such payments and
4coverage may be continued until such time as the person becomes
5an employee pursuant to this Act or such person's appointment
6is terminated.
7    (i) Any unit of local government within the State of
8Illinois may apply to the Director to have its employees,
9annuitants, and their dependents provided group health
10coverage under this Act on a non-insured basis. To participate,
11a unit of local government must agree to enroll all of its
12employees, who may select coverage under either the State group
13health benefits plan or a health maintenance organization that
14has contracted with the State to be available as a health care
15provider for employees as defined in this Act. A unit of local
16government must remit the entire cost of providing coverage
17under the State group health benefits plan or, for coverage
18under a health maintenance organization, an amount determined
19by the Director based on an analysis of the sex, age,
20geographic location, or other relevant demographic variables
21for its employees, except that the unit of local government
22shall not be required to enroll those of its employees who are
23covered spouses or dependents under this plan or another group
24policy or plan providing health benefits as long as (1) an
25appropriate official from the unit of local government attests
26that each employee not enrolled is a covered spouse or

 

 

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1dependent under this plan or another group policy or plan, and
2(2) at least 50% of the employees are enrolled and the unit of
3local government remits the entire cost of providing coverage
4to those employees, except that a participating school district
5must have enrolled at least 50% of its full-time employees who
6have not waived coverage under the district's group health plan
7by participating in a component of the district's cafeteria
8plan. A participating school district is not required to enroll
9a full-time employee who has waived coverage under the
10district's health plan, provided that an appropriate official
11from the participating school district attests that the
12full-time employee has waived coverage by participating in a
13component of the district's cafeteria plan. For the purposes of
14this subsection, "participating school district" includes a
15unit of local government whose primary purpose is education as
16defined by the Department's rules.
17    Employees of a participating unit of local government who
18are not enrolled due to coverage under another group health
19policy or plan may enroll in the event of a qualifying change
20in status, special enrollment, special circumstance as defined
21by the Director, or during the annual Benefit Choice Period. A
22participating unit of local government may also elect to cover
23its annuitants. Dependent coverage shall be offered on an
24optional basis, with the costs paid by the unit of local
25government, its employees, or some combination of the two as
26determined by the unit of local government. The unit of local

 

 

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1government shall be responsible for timely collection and
2transmission of dependent premiums.
3    The Director shall annually determine monthly rates of
4payment, subject to the following constraints:
5        (1) In the first year of coverage, the rates shall be
6    equal to the amount normally charged to State employees for
7    elected optional coverages or for enrolled dependents
8    coverages or other contributory coverages, or contributed
9    by the State for basic insurance coverages on behalf of its
10    employees, adjusted for differences between State
11    employees and employees of the local government in age,
12    sex, geographic location or other relevant demographic
13    variables, plus an amount sufficient to pay for the
14    additional administrative costs of providing coverage to
15    employees of the unit of local government and their
16    dependents.
17        (2) In subsequent years, a further adjustment shall be
18    made to reflect the actual prior years' claims experience
19    of the employees of the unit of local government.
20    In the case of coverage of local government employees under
21a health maintenance organization, the Director shall annually
22determine for each participating unit of local government the
23maximum monthly amount the unit may contribute toward that
24coverage, based on an analysis of (i) the age, sex, geographic
25location, and other relevant demographic variables of the
26unit's employees and (ii) the cost to cover those employees

 

 

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1under the State group health benefits plan. The Director may
2similarly determine the maximum monthly amount each unit of
3local government may contribute toward coverage of its
4employees' dependents under a health maintenance organization.
5    Monthly payments by the unit of local government or its
6employees for group health benefits plan or health maintenance
7organization coverage shall be deposited in the Local
8Government Health Insurance Reserve Fund.
9    The Local Government Health Insurance Reserve Fund is
10hereby created as a nonappropriated trust fund to be held
11outside the State Treasury, with the State Treasurer as
12custodian. The Local Government Health Insurance Reserve Fund
13shall be a continuing fund not subject to fiscal year
14limitations. The Local Government Health Insurance Reserve
15Fund is not subject to administrative charges or charge-backs,
16including but not limited to those authorized under Section 8h
17of the State Finance Act. All revenues arising from the
18administration of the health benefits program established
19under this Section shall be deposited into the Local Government
20Health Insurance Reserve Fund. Any interest earned on moneys in
21the Local Government Health Insurance Reserve Fund shall be
22deposited into the Fund. All expenditures from this Fund shall
23be used for payments for health care benefits for local
24government and rehabilitation facility employees, annuitants,
25and dependents, and to reimburse the Department or its
26administrative service organization for all expenses incurred

 

 

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1in the administration of benefits. No other State funds may be
2used for these purposes.
3    A local government employer's participation or desire to
4participate in a program created under this subsection shall
5not limit that employer's duty to bargain with the
6representative of any collective bargaining unit of its
7employees.
8    (j) Any rehabilitation facility within the State of
9Illinois may apply to the Director to have its employees,
10annuitants, and their eligible dependents provided group
11health coverage under this Act on a non-insured basis. To
12participate, a rehabilitation facility must agree to enroll all
13of its employees and remit the entire cost of providing such
14coverage for its employees, except that the rehabilitation
15facility shall not be required to enroll those of its employees
16who are covered spouses or dependents under this plan or
17another group policy or plan providing health benefits as long
18as (1) an appropriate official from the rehabilitation facility
19attests that each employee not enrolled is a covered spouse or
20dependent under this plan or another group policy or plan, and
21(2) at least 50% of the employees are enrolled and the
22rehabilitation facility remits the entire cost of providing
23coverage to those employees. Employees of a participating
24rehabilitation facility who are not enrolled due to coverage
25under another group health policy or plan may enroll in the
26event of a qualifying change in status, special enrollment,

 

 

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1special circumstance as defined by the Director, or during the
2annual Benefit Choice Period. A participating rehabilitation
3facility may also elect to cover its annuitants. Dependent
4coverage shall be offered on an optional basis, with the costs
5paid by the rehabilitation facility, its employees, or some
6combination of the 2 as determined by the rehabilitation
7facility. The rehabilitation facility shall be responsible for
8timely collection and transmission of dependent premiums.
9    The Director shall annually determine quarterly rates of
10payment, subject to the following constraints:
11        (1) In the first year of coverage, the rates shall be
12    equal to the amount normally charged to State employees for
13    elected optional coverages or for enrolled dependents
14    coverages or other contributory coverages on behalf of its
15    employees, adjusted for differences between State
16    employees and employees of the rehabilitation facility in
17    age, sex, geographic location or other relevant
18    demographic variables, plus an amount sufficient to pay for
19    the additional administrative costs of providing coverage
20    to employees of the rehabilitation facility and their
21    dependents.
22        (2) In subsequent years, a further adjustment shall be
23    made to reflect the actual prior years' claims experience
24    of the employees of the rehabilitation facility.
25    Monthly payments by the rehabilitation facility or its
26employees for group health benefits shall be deposited in the

 

 

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1Local Government Health Insurance Reserve Fund.
2    (k) Any domestic violence shelter or service within the
3State of Illinois may apply to the Director to have its
4employees, annuitants, and their dependents provided group
5health coverage under this Act on a non-insured basis. To
6participate, a domestic violence shelter or service must agree
7to enroll all of its employees and pay the entire cost of
8providing such coverage for its employees. The domestic
9violence shelter shall not be required to enroll those of its
10employees who are covered spouses or dependents under this plan
11or another group policy or plan providing health benefits as
12long as (1) an appropriate official from the domestic violence
13shelter attests that each employee not enrolled is a covered
14spouse or dependent under this plan or another group policy or
15plan and (2) at least 50% of the employees are enrolled and the
16domestic violence shelter remits the entire cost of providing
17coverage to those employees. Employees of a participating
18domestic violence shelter who are not enrolled due to coverage
19under another group health policy or plan may enroll in the
20event of a qualifying change in status, special enrollment, or
21special circumstance as defined by the Director or during the
22annual Benefit Choice Period. A participating domestic
23violence shelter may also elect to cover its annuitants.
24Dependent coverage shall be offered on an optional basis, with
25employees, or some combination of the 2 as determined by the
26domestic violence shelter or service. The domestic violence

 

 

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1shelter or service shall be responsible for timely collection
2and transmission of dependent premiums.
3    The Director shall annually determine rates of payment,
4subject to the following constraints:
5        (1) In the first year of coverage, the rates shall be
6    equal to the amount normally charged to State employees for
7    elected optional coverages or for enrolled dependents
8    coverages or other contributory coverages on behalf of its
9    employees, adjusted for differences between State
10    employees and employees of the domestic violence shelter or
11    service in age, sex, geographic location or other relevant
12    demographic variables, plus an amount sufficient to pay for
13    the additional administrative costs of providing coverage
14    to employees of the domestic violence shelter or service
15    and their dependents.
16        (2) In subsequent years, a further adjustment shall be
17    made to reflect the actual prior years' claims experience
18    of the employees of the domestic violence shelter or
19    service.
20    Monthly payments by the domestic violence shelter or
21service or its employees for group health insurance shall be
22deposited in the Local Government Health Insurance Reserve
23Fund.
24    (l) A public community college or entity organized pursuant
25to the Public Community College Act may apply to the Director
26initially to have only annuitants not covered prior to July 1,

 

 

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11992 by the district's health plan provided health coverage
2under this Act on a non-insured basis. The community college
3must execute a 2-year contract to participate in the Local
4Government Health Plan. Any annuitant may enroll in the event
5of a qualifying change in status, special enrollment, special
6circumstance as defined by the Director, or during the annual
7Benefit Choice Period.
8    The Director shall annually determine monthly rates of
9payment subject to the following constraints: for those
10community colleges with annuitants only enrolled, first year
11rates shall be equal to the average cost to cover claims for a
12State member adjusted for demographics, Medicare
13participation, and other factors; and in the second year, a
14further adjustment of rates shall be made to reflect the actual
15first year's claims experience of the covered annuitants.
16    (l-5) The provisions of subsection (l) become inoperative
17on July 1, 1999.
18    (m) The Director shall adopt any rules deemed necessary for
19implementation of this amendatory Act of 1989 (Public Act
2086-978).
21    (n) Any child advocacy center within the State of Illinois
22may apply to the Director to have its employees, annuitants,
23and their dependents provided group health coverage under this
24Act on a non-insured basis. To participate, a child advocacy
25center must agree to enroll all of its employees and pay the
26entire cost of providing coverage for its employees. The child

 

 

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1advocacy center shall not be required to enroll those of its
2employees who are covered spouses or dependents under this plan
3or another group policy or plan providing health benefits as
4long as (1) an appropriate official from the child advocacy
5center attests that each employee not enrolled is a covered
6spouse or dependent under this plan or another group policy or
7plan and (2) at least 50% of the employees are enrolled and the
8child advocacy center remits the entire cost of providing
9coverage to those employees. Employees of a participating child
10advocacy center who are not enrolled due to coverage under
11another group health policy or plan may enroll in the event of
12a qualifying change in status, special enrollment, or special
13circumstance as defined by the Director or during the annual
14Benefit Choice Period. A participating child advocacy center
15may also elect to cover its annuitants. Dependent coverage
16shall be offered on an optional basis, with the costs paid by
17the child advocacy center, its employees, or some combination
18of the 2 as determined by the child advocacy center. The child
19advocacy center shall be responsible for timely collection and
20transmission of dependent premiums.
21    The Director shall annually determine rates of payment,
22subject to the following constraints:
23        (1) In the first year of coverage, the rates shall be
24    equal to the amount normally charged to State employees for
25    elected optional coverages or for enrolled dependents
26    coverages or other contributory coverages on behalf of its

 

 

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1    employees, adjusted for differences between State
2    employees and employees of the child advocacy center in
3    age, sex, geographic location, or other relevant
4    demographic variables, plus an amount sufficient to pay for
5    the additional administrative costs of providing coverage
6    to employees of the child advocacy center and their
7    dependents.
8        (2) In subsequent years, a further adjustment shall be
9    made to reflect the actual prior years' claims experience
10    of the employees of the child advocacy center.
11    Monthly payments by the child advocacy center or its
12employees for group health insurance shall be deposited into
13the Local Government Health Insurance Reserve Fund.
14(Source: P.A. 100-587, eff. 6-4-18.)
 
15    Section 99. Effective date. This Act takes effect upon
16becoming law.