State of Illinois
90th General Assembly
Legislation

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[ Engrossed ][ Senate Amendment 003 ][ Senate Amendment 004 ]

90_SB1921

      5 ILCS 375/10             from Ch. 127, par. 530
          Amends the State Employees Group Insurance Act  of  1971.
      Provides  that the cost of participation in the basic program
      of group health benefits for the dependent or survivor  of  a
      living or deceased retired employee who was formerly employed
      by  the  University  of Illinois in the Cooperative Extension
      Service and would be an annuitant but for the fact that he or
      she  was  made  ineligible  to  participate  in   the   State
      Universities  Retirement  System  by clause (4) of subsection
      (a) of Section 15-107 of the Illinois Pension Code shall  not
      be   greater  than  the  cost  of  participation  that  would
      otherwise apply to that dependent or survivor if  he  or  she
      were  the  dependent  or  survivor  of an annuitant under the
      State Universities Retirement System.  Also  makes  technical
      corrections.  Effective immediately.
                                                     LRB9011685EGfg
                                               LRB9011685EGfg
 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
26    that  such  reduction  in  benefits shall apply only to those
27    retired members or retired dependents who  (1)  first  become
28    eligible for such Medicare coverage on or after July 1, 1992;
29    or  (2)  remain  eligible for, but no longer receive Medicare
30    coverage which they had been receiving on or  after  July  1,
31    1992.   The  Department  may determine the aggregate level of
                            -2-                LRB9011685EGfg
 1    the State's contribution on  the  basis  of  actual  cost  of
 2    medical services adjusted for age, sex or geographic or other
 3    demographic  characteristics  which  affect the costs of such
 4    programs.
 5        The cost of participation in the basic program  of  group
 6    health  benefits for the dependent or survivor of a living or
 7    deceased retired employee who was formerly  employed  by  the
 8    University  of  Illinois in the Cooperative Extension Service
 9    and would be an annuitant but for the fact that he or she was
10    made ineligible to  participate  in  the  State  Universities
11    Retirement  System by clause (4) of subsection (a) of Section
12    15-107 of the Illinois Pension Code shall not be greater than
13    the cost of participation that would otherwise apply to  that
14    dependent  or  survivor  if  he  or she were the dependent or
15    survivor  of  an  annuitant  under  the  State   Universities
16    Retirement System.
17        (a-1)  Beginning  January  1,  1998,  for each person who
18    becomes a new SERS annuitant and participates  in  the  basic
19    program  of group health benefits, the State shall contribute
20    toward the cost of the annuitant'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 creditable service upon which
23    the annuitant's retirement annuity is based, up to a  maximum
24    of  100% for an annuitant with 20 or more years of creditable
25    service.  The remainder of the cost of a new SERS annuitant's
26    coverage under the basic program  of  group  health  benefits
27    shall be the responsibility of the annuitant.
28        (a-2)  Beginning  January  1,  1998,  for each person who
29    becomes a new SERS survivor and  participates  in  the  basic
30    program  of group health benefits, the State shall contribute
31    toward the cost of the survivor'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 the  deceased  employee's  or
34    deceased   annuitant's   creditable   service  in  the  State
                            -3-                LRB9011685EGfg
 1    Employees' Retirement System  of  Illinois  on  the  date  of
 2    death,  up to a maximum of 100% for a survivor of an employee
 3    or annuitant with 20 or more  years  of  creditable  service.
 4    The remainder of the cost of the new SERS survivor's coverage
 5    under the basic program of group health benefits shall be the
 6    responsibility of the survivor.
 7        (a-3)  Beginning  January  1,  1998,  for each person who
 8    becomes a new SURS annuitant and participates  in  the  basic
 9    program  of group health benefits, the State shall contribute
10    toward the cost of the annuitant's coverage under  the  basic
11    program  of  group  health  benefits an amount equal to 5% of
12    that cost for each full year of creditable service upon which
13    the annuitant's retirement annuity is based, up to a  maximum
14    of  100% for an annuitant with 20 or more years of creditable
15    service.  The remainder of the cost of a new SURS annuitant's
16    coverage under the basic program  of  group  health  benefits
17    shall be the responsibility of the annuitant.
18        (a-4)  Beginning  January  1,  1998,  for each person who
19    becomes a new SURS retired employee and participates  in  the
20    basic  program  of  group  health  benefits,  the State shall
21    contribute toward the cost of the retired employee's coverage
22    under the basic program of group health  benefits  an  amount
23    equal  to 5% of that cost for each full year that the retired
24    employee was an employee as defined in Section  3,  up  to  a
25    maximum  of  100%  for a retired employee who was an employee
26    for 20 or more years.  The remainder of the  cost  of  a  new
27    SURS  retired  employee's coverage under the basic program of
28    group health benefits shall  be  the  responsibility  of  the
29    retired employee.
30        (a-5)  Beginning  January  1,  1998,  for each person who
31    becomes a new SURS survivor and  participates  in  the  basic
32    program  of group health benefits, the State shall contribute
33    toward the cost of the survivor's coverage  under  the  basic
34    program  of  group  health  benefits an amount equal to 5% of
                            -4-                LRB9011685EGfg
 1    that cost for each full year of the  deceased  employee's  or
 2    deceased   annuitant's   creditable   service  in  the  State
 3    Universities Employees' Retirement System of Illinois on  the
 4    date  of  death, up to a maximum of 100% for a survivor of an
 5    employee or annuitant with 20 or  more  years  of  creditable
 6    service.    The  remainder  of  the  cost  of  the  new  SURS
 7    survivor's coverage under the basic program of  group  health
 8    benefits shall be the responsibility of the survivor.
 9        (a-6)  A  new SERS annuitant, new SERS survivor, new SURS
10    annuitant, new SURS retired employee, or  new  SURS  survivor
11    may  waive  or  terminate  coverage  in  the program of group
12    health benefits.  Any such annuitant,  survivor,  or  retired
13    employee  who has waived or terminated coverage may enroll or
14    re-enroll in the program of group health benefits only during
15    the annual  benefit  choice  period,  as  determined  by  the
16    Director; except that in the event of termination of coverage
17    due  to  nonpayment  of premiums, the annuitant, survivor, or
18    retired employee may not re-enroll in the program.
19        (a-7) No later than May 1  of  each  calendar  year,  the
20    Director  of  Central  Management  Services  shall certify in
21    writing to the Executive Secretary of  the  State  Employees'
22    Employee's  Retirement  System of Illinois the amounts of the
23    Medicare supplement health care premiums and the  amounts  of
24    the  health  care premiums for all other retirees who are not
25    Medicare eligible.
26        A separate calculation of the  premiums  based  upon  the
27    actual cost of each health care plan shall be so certified.
28        The Director of Central Management Services shall provide
29    to the Executive Secretary of the State Employees' Employee's
30    Retirement  System  of Illinois such information, statistics,
31    and other data as he or she he/she may require to review  the
32    premium   amounts   certified  by  the  Director  of  Central
33    Management Services.
34        (b)  State employees who become eligible for this program
                            -5-                LRB9011685EGfg
 1    on or after January 1, 1980 in positions, normally  requiring
 2    actual performance of duty not less than 1/2 of a normal work
 3    period  but  not equal to that of a normal work period, shall
 4    be  given  the  option  of  participating  in  the  available
 5    program.  If the employee elects coverage,  the  State  shall
 6    contribute  on  behalf  of  such  employee to the cost of the
 7    employee's benefit and any applicable  dependent  supplement,
 8    that  sum  which bears the same percentage as that percentage
 9    of time the employee regularly works when compared to  normal
10    work period.
11        (c)  The  basic  non-contributory coverage from the basic
12    program of group health benefits shall be continued for  each
13    employee  not in pay status or on active service by reason of
14    (1) leave of absence due to illness or injury, (2) authorized
15    educational leave of absence  or  sabbatical  leave,  or  (3)
16    military  leave  with  pay  and benefits. This coverage shall
17    continue until expiration of authorized leave and  return  to
18    active  service, but not to exceed 24 months for leaves under
19    item (1) or (2). This 24-month limitation and the requirement
20    of returning to active service shall  not  apply  to  persons
21    receiving  ordinary  or  accidental  disability  benefits  or
22    retirement  benefits through the appropriate State retirement
23    system  or  benefits  under  the  Workers'  Compensation   or
24    Occupational Disease Act.
25        (d)  The   basic  group  life  insurance  coverage  shall
26    continue, with full State contribution, where such person  is
27    (1)  absent  from  active  service  by  reason  of disability
28    arising from any cause  other  than  self-inflicted,  (2)  on
29    authorized  educational leave of absence or sabbatical leave,
30    or (3) on military leave with pay and benefits.
31        (e)  Where the person is in non-pay status for  a  period
32    in  excess  of  30 days or on leave of absence, other than by
33    reason of disability, educational  or  sabbatical  leave,  or
34    military  leave  with  pay  and  benefits,  such  person  may
                            -6-                LRB9011685EGfg
 1    continue  coverage  only  by making personal payment equal to
 2    the amount normally contributed by the State on such person's
 3    behalf. Such payments and  coverage  may  be  continued:  (1)
 4    until  such  time  as the person returns to a status eligible
 5    for coverage at State expense, but not to exceed  24  months,
 6    (2)  until  such person's employment or annuitant status with
 7    the State is terminated, or (3) for a  maximum  period  of  4
 8    years for members on military leave with pay and benefits and
 9    military  leave  without  pay  and benefits (exclusive of any
10    additional service imposed pursuant to law).
11        (f)  The Department shall  establish by rule  the  extent
12    to which other employee benefits will continue for persons in
13    non-pay status or who are not in active service.
14        (g)  The  State  shall  not  pay  the  cost  of the basic
15    non-contributory group  life  insurance,  program  of  health
16    benefits  and  other  employee  benefits  for members who are
17    survivors as defined by paragraphs (1) and (2) of  subsection
18    (q)  of  Section  3  of  this Act.  The costs of benefits for
19    these survivors shall be paid by  the  survivors  or  by  the
20    University  of Illinois Cooperative Extension Service, or any
21    combination thereof.
22        (h)  Those   persons   occupying   positions   with   any
23    department as a result of emergency appointments pursuant  to
24    Section  8b.8  of  the  Personnel Code who are not considered
25    employees under  this  Act  shall  be  given  the  option  of
26    participating in the programs of group life insurance, health
27    benefits  and other employee benefits.  Such persons electing
28    coverage may participate only by making payment equal to  the
29    amount  normally  contributed  by  the  State  for  similarly
30    situated  employees.  Such amounts shall be determined by the
31    Director.  Such payments and coverage may be continued  until
32    such  time as the person becomes an employee pursuant to this
33    Act or such person's appointment is terminated.
34        (i)  Any unit of local government  within  the  State  of
                            -7-                LRB9011685EGfg
 1    Illinois  may  apply  to  the Director to have its employees,
 2    annuitants,  and  their  dependents  provided  group   health
 3    coverage   under   this  Act  on  a  non-insured  basis.   To
 4    participate, a unit of local government must agree to  enroll
 5    all  of  its  employees, who may select coverage under either
 6    the State group health insurance plan or a health maintenance
 7    organization  that  has  contracted  with  the  State  to  be
 8    available as a health care provider for employees as  defined
 9    in  this  Act.   A  unit  of  local government must remit the
10    entire cost of  providing  coverage  under  the  State  group
11    health  insurance  plan  or,  for  coverage  under  a  health
12    maintenance   organization,   an  amount  determined  by  the
13    Director based on an analysis of  the  sex,  age,  geographic
14    location,  or  other  relevant  demographic variables for its
15    employees, except that the unit of local government shall not
16    be required to enroll those of its employees who are  covered
17    spouses or dependents under this plan or another group policy
18    or   plan  providing  health  benefits  as  long  as  (1)  an
19    appropriate  official  from  the  unit  of  local  government
20    attests that each employee not enrolled is a  covered  spouse
21    or dependent under this plan or another group policy or plan,
22    and  (2)  at  least 85% of the employees are enrolled and the
23    unit of local government remits the entire cost of  providing
24    coverage  to  those  employees.  Employees of a participating
25    unit of local government who are not enrolled due to coverage
26    under another group health policy or plan  may  enroll  at  a
27    later  date subject to submission of satisfactory evidence of
28    insurability and provided that no benefits shall  be  payable
29    for  services  incurred during the first 6 months of coverage
30    to the extent  the  services  are   in  connection  with  any
31    pre-existing   condition.   A  participating  unit  of  local
32    government may also elect to cover its annuitants.  Dependent
33    coverage shall be offered on  an  optional  basis,  with  the
34    costs paid by the unit of local government, its employees, or
                            -8-                LRB9011685EGfg
 1    some  combination  of  the  two  as determined by the unit of
 2    local government.  The unit  of  local  government  shall  be
 3    responsible   for   timely  collection  and  transmission  of
 4    dependent premiums.
 5        The Director shall annually determine  monthly  rates  of
 6    payment, subject to the following constraints:
 7             (1)  In  the first year of coverage, the rates shall
 8        be  equal  to  the  amount  normally  charged  to   State
 9        employees  for elected optional coverages or for enrolled
10        dependents coverages or other contributory coverages,  or
11        contributed by the State for basic insurance coverages on
12        behalf of its employees, adjusted for differences between
13        State  employees and employees of the local government in
14        age,  sex,  geographic   location   or   other   relevant
15        demographic  variables,  plus an amount sufficient to pay
16        for the  additional  administrative  costs  of  providing
17        coverage to employees of the unit of local government and
18        their dependents.
19             (2)  In subsequent years, a further adjustment shall
20        be  made  to  reflect  the  actual  prior  years'  claims
21        experience   of  the  employees  of  the  unit  of  local
22        government.
23        In the case of coverage  of  local  government  employees
24    under  a  health maintenance organization, the Director shall
25    annually determine  for  each  participating  unit  of  local
26    government the maximum monthly amount the unit may contribute
27    toward  that  coverage,  based on an analysis of (i) the age,
28    sex, geographic  location,  and  other  relevant  demographic
29    variables  of the unit's employees and (ii) the cost to cover
30    those employees under the State group health insurance  plan.
31    The  Director  may  similarly  determine  the maximum monthly
32    amount each unit of local government  may  contribute  toward
33    coverage   of   its  employees'  dependents  under  a  health
34    maintenance organization.
                            -9-                LRB9011685EGfg
 1        Monthly payments by the unit of local government  or  its
 2    employees  for  group  health insurance or health maintenance
 3    organization  coverage  shall  be  deposited  in  the   Local
 4    Government   Health   Insurance   Reserve  Fund.   The  Local
 5    Government  Health  Insurance  Reserve  Fund   shall   be   a
 6    continuing  fund not subject to fiscal year limitations.  All
 7    expenditures from this fund shall be used  for  payments  for
 8    health  care benefits for local government and rehabilitation
 9    facility  employees,  annuitants,  and  dependents,  and   to
10    reimburse   the  Department  or  its  administrative  service
11    organization for all expenses incurred in the  administration
12    of  benefits.   No  other  State  funds may be used for these
13    purposes.
14        A local government employer's participation or desire  to
15    participate  in a program created under this subsection shall
16    not  limit  that  employer's  duty  to   bargain   with   the
17    representative  of  any  collective  bargaining  unit  of its
18    employees.
19        (j)  Any rehabilitation  facility  within  the  State  of
20    Illinois  may  apply  to  the Director to have its employees,
21    annuitants,  and  their  dependents  provided  group   health
22    coverage   under   this   Act  on  a  non-insured  basis.  To
23    participate, a rehabilitation facility must agree  to  enroll
24    all  of  its employees and remit the entire cost of providing
25    such  coverage   for   its   employees,   except   that   the
26    rehabilitation facility shall not be required to enroll those
27    of  its employees who are covered spouses or dependents under
28    this plan or another group policy or  plan  providing  health
29    benefits  as  long  as  (1)  an appropriate official from the
30    rehabilitation  facility  attests  that  each  employee   not
31    enrolled  is a covered spouse or dependent under this plan or
32    another group policy or plan, and (2) at  least  85%  of  the
33    employees are enrolled and the rehabilitation facility remits
34    the  entire  cost  of  providing coverage to those employees.
                            -10-               LRB9011685EGfg
 1    Employees of a participating rehabilitation facility who  are
 2    not  enrolled  due  to  coverage  under  another group health
 3    policy or  plan  may  enroll  at  a  later  date  subject  to
 4    submission  of  satisfactory  evidence  of  insurability  and
 5    provided  that  no  benefits  shall  be  payable for services
 6    incurred during the first 6 months of coverage to the  extent
 7    the   services   are  in  connection  with  any  pre-existing
 8    condition. A participating rehabilitation facility  may  also
 9    elect  to  cover  its annuitants. Dependent coverage shall be
10    offered on an optional basis, with  the  costs  paid  by  the
11    rehabilitation  facility,  its employees, or some combination
12    of the 2 as determined by the  rehabilitation  facility.  The
13    rehabilitation  facility  shall  be  responsible  for  timely
14    collection and transmission of dependent premiums.
15        The  Director shall annually determine quarterly rates of
16    payment, subject to the following constraints:
17             (1)  In the first year of coverage, the rates  shall
18        be   equal  to  the  amount  normally  charged  to  State
19        employees for elected optional coverages or for  enrolled
20        dependents  coverages  or other contributory coverages on
21        behalf of its employees, adjusted for differences between
22        State  employees  and  employees  of  the  rehabilitation
23        facility  in  age,  sex,  geographic  location  or  other
24        relevant demographic variables, plus an amount sufficient
25        to  pay  for  the  additional  administrative  costs   of
26        providing  coverage  to  employees  of the rehabilitation
27        facility and their dependents.
28             (2)  In subsequent years, a further adjustment shall
29        be  made  to  reflect  the  actual  prior  years'  claims
30        experience  of  the  employees  of   the   rehabilitation
31        facility.
32        Monthly  payments  by  the rehabilitation facility or its
33    employees for group health insurance shall  be  deposited  in
34    the Local Government Health Insurance Reserve Fund.
                            -11-               LRB9011685EGfg
 1        (k)  Any  domestic violence shelter or service within the
 2    State of Illinois may apply  to  the  Director  to  have  its
 3    employees,  annuitants,  and  their dependents provided group
 4    health coverage under this Act on a  non-insured  basis.   To
 5    participate,  a  domestic  violence  shelter  or service must
 6    agree to enroll all of its employees and pay the entire  cost
 7    of   providing   such   coverage   for   its   employees.   A
 8    participating domestic violence shelter  may  also  elect  to
 9    cover its annuitants.  Dependent coverage shall be offered on
10    an optional basis, with employees, or some combination of the
11    2  as determined by the domestic violence shelter or service.
12    The domestic violence shelter or service shall be responsible
13    for timely collection and transmission of dependent premiums.
14        The Director shall annually determine quarterly rates  of
15    payment, subject to the following constraints:
16             (1)  In  the first year of coverage, the rates shall
17        be  equal  to  the  amount  normally  charged  to   State
18        employees  for elected optional coverages or for enrolled
19        dependents coverages or other contributory  coverages  on
20        behalf of its employees, adjusted for differences between
21        State  employees  and  employees of the domestic violence
22        shelter or service in age, sex,  geographic  location  or
23        other  relevant  demographic  variables,  plus  an amount
24        sufficient to pay for the additional administrative costs
25        of  providing  coverage  to  employees  of  the  domestic
26        violence shelter or service and their dependents.
27             (2)  In subsequent years, a further adjustment shall
28        be  made  to  reflect  the  actual  prior  years'  claims
29        experience of the  employees  of  the  domestic  violence
30        shelter or service.
31             (3)  In  no  case  shall  the  rate be less than the
32        amount normally charged to State employees or contributed
33        by the State on behalf of its employees.
34        Monthly payments by  the  domestic  violence  shelter  or
                            -12-               LRB9011685EGfg
 1    service  or its employees for group health insurance shall be
 2    deposited in the Local Government  Health  Insurance  Reserve
 3    Fund.
 4        (l)  A  public  community  college  or  entity  organized
 5    pursuant to the Public Community College Act may apply to the
 6    Director  initially to have only annuitants not covered prior
 7    to July 1, 1992 by the district's health plan provided health
 8    coverage  under  this  Act  on  a  non-insured  basis.    The
 9    community   college   must   execute  a  2-year  contract  to
10    participate in  the  Local  Government  Health  Plan.   Those
11    annuitants  enrolled initially under this contract shall have
12    no benefits payable for services incurred during the first  6
13    months  of  coverage  to  the  extent  the  services  are  in
14    connection  with  any  pre-existing condition.  Any annuitant
15    who may enroll after this initial enrollment period shall  be
16    subject   to   submission   of   satisfactory   evidence   of
17    insurability and to the pre-existing conditions limitation.
18        The  Director  shall  annually determine monthly rates of
19    payment subject to  the  following  constraints:   for  those
20    community  colleges with annuitants only enrolled, first year
21    rates shall be equal to the average cost to cover claims  for
22    a   State   member   adjusted   for   demographics,  Medicare
23    participation, and other factors; and in the second  year,  a
24    further  adjustment  of  rates  shall  be made to reflect the
25    actual  first  year's  claims  experience  of   the   covered
26    annuitants.
27        (m)  The  Director shall adopt any rules deemed necessary
28    for implementation of this amendatory Act of 1989 (Public Act
29    86-978).
30    (Source:  P.A.  89-53,  eff.  7-1-95;  89-236,  eff.  8-4-95;
31    89-324,  eff.  8-13-95;  89-626,  eff.  8-9-96;  90-65,  eff.
32    7-7-97; revised 1-13-98.)
33        Section 99. Effective date.  This Act takes  effect  upon
                            -13-               LRB9011685EGfg
 1    becoming law.

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