HB0355 EnrolledLRB097 03238 JDS 43275 b

1    AN ACT concerning government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The State Employee Health Savings Account Law is
5amended by changing Sections 10-5 and 10-10 as follows:
 
6    (5 ILCS 377/10-5)
7    Sec. 10-5. Definitions. As used in this Law:
8    (a) "Deductible" means the total deductible of a high
9deductible health plan for an eligible individual and all the
10dependents of that eligible individual for a calendar year.
11    (b) "Dependent" means a dependent as defined in Section 3
12of the State Employees Group Insurance Act of 1971, provided
13that the dependent meets the definition of "dependent" under
14Section 152 of the Internal Revenue Code of 1986, determined
15without regard to subdivisions (b)(1), (b)(2), and (d)(1)(B) of
16that Section an eligible individual's spouse or child, as
17defined in Section 152 of the Internal Revenue Code of 1986.
18"Dependent" includes a party to a civil union, as defined under
19Section 10 of the Illinois Religious Freedom Protection and
20Civil Union Act.
21    (c) "Eligible individual" means an employee, as defined in
22Section 3 of the State Employees Group Insurance Act of 1971,
23who contributes to health savings accounts on the employees'

 

 

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1behalf, who:
2        (1) is covered by a high deductible health plan
3    individually or with dependents; and
4        (2) is not covered under any health plan that is not a
5    high deductible health plan, except for:
6            (i) coverage for accidents;
7            (ii) workers' compensation insurance;
8            (iii) insurance for a specified disease or
9        illness;
10            (iv) insurance paying a fixed amount per day per
11        hospitalization; and
12            (v) tort liabilities; and
13        (3) establishes a health savings account or on whose
14    behalf the health savings account is established; .
15        (4) is not entitled to Medicare; and
16        (5) cannot be claimed as a dependent on another
17    person's tax return.
18    (d) "Employer" means a State agency, department, or other
19entity that employs an eligible individual.
20    (e) "Health savings account" or "account" means a trust or
21custodial account established under a State program
22exclusively to pay the qualified medical expenses of an
23eligible individual, or his or her dependents, that meets all
24of the following requirements:
25        (1) Except in the case of a rollover contribution, no
26    contribution may be accepted:

 

 

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1            (A) unless it is in cash; or
2            (B) to the extent that the contribution, when added
3        to the previous contributions to the Account for the
4        calendar year, exceeds the lesser of (i) 100% of the
5        eligible individual's deductible or (ii) the
6        contribution level set for that year by the Internal
7        Revenue Service.
8        (2) The trustee or custodian is a bank, an insurance
9    company, or another person approved by the Director of
10    Insurance.
11        (3) No part of the trust assets shall be invested in
12    life insurance contracts.
13        (4) The assets of the account shall not be commingled
14    with other property except as allowed for under Individual
15    Retirement Accounts.
16        (5) Eligible individual's interest in the account is
17    nonforfeitable.
18    (f) "Health savings account program" or "program" means a
19program that includes all of the following:
20        (1) Participation The purchase by an eligible
21    individual in an employer-sponsored or by an employer of a
22    high deductible health plan.
23        (2) The contribution into a health savings account by
24    an eligible individual or on behalf of an employee or by
25    his or her employer. The total annual contribution may not
26    exceed the amount of the deductible or the amounts listed

 

 

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1    in sub-item (B) of item (1) of subsection (e) (f) of this
2    Section.
3    (g) "High deductible" means:
4        (1) In the case of self-only coverage, an annual
5    deductible that is not less than the level set by the
6    Internal Revenue Service and that, when added to the other
7    annual out-of-pocket expenses required to be paid under the
8    plan for covered benefits, does not exceed the maximum
9    level set by the Internal Revenue Service $5,000; and
10        (2) In the case of family coverage, an annual
11    deductible of not less than the level set by the Internal
12    Revenue Service and that, when added to the other annual
13    out-of-pocket expenses required to be paid under the plan
14    for covered benefits, does not exceed the maximum level set
15    by the Internal Revenue Service $10,000.
16    A plan shall not fail to be treated as a high deductible
17plan by reason of a failure to have a deductible for preventive
18care or, in the case of network plans, for having out-of-pocket
19expenses that exceed these limits on an annual deductible for
20services that are provided outside the network.
21    (h) "High deductible health plan" means a health coverage
22policy, certificate, or contract that provides for payments for
23covered benefits that exceed the high deductible.
24    (i) "Qualified medical expense" means an expense paid by
25the eligible individual for medical care described in Section
26213(d) of the Internal Revenue Code of 1986.

 

 

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1(Source: P.A. 97-142, eff. 7-14-11.)
 
2    (5 ILCS 377/10-10)
3    Sec. 10-10. Application; authorized contributions.
4    (a) Beginning in calendar taxable year 2012 2011, each
5employer shall make available to each eligible individual a
6health savings account program, if that individual chooses to
7enroll in the program except that, for an employer who provides
8coverage pursuant to any one or more of subsections (i) through
9(n) of Section 10 of the State Employee Group Insurance Act,
10that employer may make available a health savings account
11program. An employer who makes a health savings account program
12available shall annually deposit an amount equal to one-third
13of the annual deductible $2,750 annually into an eligible
14individual's health savings account. Unused funds in a health
15savings account shall become the property of the account holder
16at the end of a taxable year.
17    (b) Beginning in calendar taxable year 2012 2011, an
18eligible individual may deposit contributions into a health
19savings account in accordance with the restrictions set forth
20in subsection (e) of Section 10-5. The amount of deposit may
21not exceed the amount of the deductible for the policy.
22(Source: P.A. 97-142, eff. 7-14-11.)
 
23    Section 99. Effective date. This Act takes effect upon
24becoming law.