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1995 SESSION

LD1514633
SENATE BILL NO. 238
Offered January 24, 1994
A BILL to amend and reenact §§ 2.1-20.1:2, 2.1-20.1:3, 2.1-20.1:4, and 15.1-7.3 of the Code of Virginia and to amend the Code of Virginia by adding sections numbered 2.1-20.1:03 and 2.1-20.1:04, relating to health insurance coverage.
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Patrons--Colgan, Robb and Stosch
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Referred to the Committee on General Laws
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Be it enacted by the General Assembly of Virginia:

1. That §§ 2.1-20.1:2, 2.1-20.1:3, 2.1-20.1:4, and 15.1-7.3 of the Code of Virginia are amended and reenacted and that the Code of Virginia is amended by adding sections numbered 2.1-20.1:03 and 2.1-20.1:04 as follows:

§ 2.1-20.1:03. Purchase of continued health insurance coverage by a state employee, a local government employee, a local officer, or a teacher who becomes permanently and totally incapacitated while in the course of employment.

A. A "state employee" as defined in § 2.1-20.1 or a "local government employee," a "local officer," or a "teacher" as defined in § 2.1-20.1:02 who is injured as defined in § 65.2-101 by accident while in the course of employment or by occupational disease as defined in § 65.2-400 shall be entitled, upon proper application to the Department of Personnel and Training, to purchase continued health insurance coverage on the following conditions: (i) on the date of the injury, the injured participated in a health insurance plan administered by the Department of Personnel and Training pursuant to § 2.1-20.1 or § 2.1-20.1:02; (ii) the injury occurred while in the course of employment as the direct or proximate result of the performance of his duty as a state employee, a local government employee, a local officer, or a teacher; and (iii) the injury resulted in permanent and total incapacity as defined in subsection C of § 65.2-503.

B. If the provisions of subsection A apply, the injured shall also be entitled to purchase continuing coverage hereunder for his spouse and any dependents who were included in condition (i) of subsection A on the date of injury.

C. Any application to purchase continued health insurance coverage hereunder shall be made in writing to the Department of Personnel and Training within sixty days of the date of injury. The time for making application may be extended by the Department for good cause shown.

1. In addition to any necessary information requested by the Department, the application shall state whether conditions (i), (ii), and (iii) set forth in subsection A have been met.

2. Within ten days of receipt of the application, the Department shall notify the applicant's employer that such application was made.

3. Within ten days of receipt of the application notice, the employer shall verify in writing to the Department whether the conditions set forth in subsection A have been met.

4. If the employer states that such conditions have been met, the Department shall approve the application and so notify the applicant within ten days of receipt of the employer's response.

5. If the employer states such conditions have not been met, the Department shall schedule, within thirty days of receipt of the employer's response, an informal fact-finding conference or consultation with the applicant and the employer pursuant to § 9-6.14:11 of the Administrative Process Act.

6. Upon scheduling the conference or consultation, the provisions of the Administrative Process Act (§ 9-6.14:1 et seq.) shall apply thereafter.

D. The employer may pay all or a portion of the cost of continued health insurance coverage hereunder. Upon payment of any required premiums, coverage shall be effective retroactive to the date of injury.

E. The terms, conditions, and costs of continued health insurance coverage purchased hereunder shall be subject to administration by the Department of Personnel and Training. The Department may increase the cost of coverage consistent with its administration of health insurance plans under § 2.1-20.1 or § 2.1-20.1:02.

F. Any continued health insurance coverage purchased hereunder shall automatically terminate upon occurrence of any one of the following: (i) death of the injured (unless § 2.1-20.1:04 applies); (ii) alternate health insurance coverage being obtained; or (iii) any applicable condition outlined in the policies and procedures of the Department of Personnel and Training governing health insurance plans administered pursuant to § 2.1-20.1 or § 2.1-20.1:02.

G. The provisions of this section shall apply to the governing body of every county, city, or town that provides insurance for its employees and retired employees pursuant to § 15.1-7.3.

§ 2.1-20.1:04. Purchase of continued health insurance coverage by the surviving spouse and any dependents of a state employee, a local government employee, or a teacher who dies while in the course of employment.

A. The surviving spouse and any dependents of a "state employee" as defined in § 2.1-20.1 or a "local government employee," a "local officer," or a "teacher" as defined in § 2.1-20.1:02 shall be entitled, upon proper application to the Department of Personnel and Training, to purchase continued health insurance coverage on the following conditions: (i) on the date of his death, the deceased participated in a health insurance plan administered by the Department of Personnel and Training pursuant to § 2.1-20.1 or § 2.1-20.1:02; (ii) on the date of the deceased's death, the applicants were included in the health insurance plan in condition (i); and (iii) the deceased's death occurred while in the course of employment as the direct or proximate result of the performance of his duty as a state employee, a local government employee, a local officer, or a teacher. Such death caused by hypertension or heart disease shall be deemed the direct or proximate result of the performance of his duty unless such presumption is overcome by a preponderance of evidence to the contrary.

B. Any application to purchase continued health insurance coverage hereunder shall be made in writing to the Department of Personnel and Training within sixty days of the date of the deceased's death. The time for making application may be extended by the Department for good cause shown.

1. In addition to any necessary information requested by the Department, the application shall state whether conditions (i), (ii), and (iii) set forth in subsection A have been met.

2. Within ten days of receipt of the application, the Department shall notify the deceased's employer that such application was made.

3. Within ten days of receipt of the application notice, the employer shall verify in writing to the Department whether the conditions set forth in subsection A have been met.

4. If the employer states that such conditions have been met, the Department shall approve the application and so notify the applicant within ten days of receipt of the employer's response.

5. If the employer states that such conditions have not been met, the Department shall schedule, within thirty days of receipt of the employer's response, an informal fact-finding conference or consultation with the applicant and the employer pursuant to § 9-6.14:11 of the Administrative Process Act.

6. Upon scheduling the conference or consultation, the provisions of the Administrative Process Act (§ 9-6.14:1 et seq.) shall apply thereafter.

C. The employer may pay all or a portion of the cost of continued health insurance coverage hereunder. Upon payment of any required premiums, coverage shall be effective retroactive to the date of the deceased's death.

D. The terms, conditions, and costs of continued health insurance coverage purchased hereunder shall be subject to administration by the Department of Personnel and Training. The Department may increase the cost of coverage consistent with its administration of health insurance plans under § 2.1-20.1 or § 2.1-20.1:02.

E. For the surviving spouse, continued health insurance coverage purchased hereunder shall automatically terminate upon occurrence of any of the following: (i) death, (ii) remarriage, (iii) alternate health insurance coverage being obtained, or (iv) any applicable condition outlined in the policies and procedures of the Department of Personnel and Training governing health insurance plans administered pursuant to § 2.1-20.1 or § 2.1-20.1:02.

F. For any surviving dependents, continued health insurance coverage purchased hereunder shall automatically terminate upon occurrence of any of the following: (i) death; (ii) marriage; (iii) alternate health insurance coverage being obtained; (iv) attaining the age of twenty-one, unless the dependent is a full-time college student, then age twenty-five; or (v) any applicable condition outlined in the policies and procedures of the Department of Personnel and Training governing health insurance plans administered pursuant to § 2.1-20.1 or § 2.1-20.1:02.

G. The provisions of this section shall apply to the governing body of every county, city, or town that provides insurance for its employees and retired employees pursuant to § 15.1-7.3.

§ 2.1-20.1:2. (Effective July 1, 1994) Health insurance credits for retired state employees.

A. The Commonwealth shall pay the cost of coverage for state employees retired under the Virginia Retirement System, State Police Officers Retirement System, Judicial Retirement System or any retirement system authorized pursuant to § 51.1-126 who (i) served no less than fifteen years of creditable service as regularly employed full-time employees of the Commonwealth or (ii) rendered service as a temporary employee of the General Assembly in 1972 and became a member of the retirement system from 1972 to 1985 immediately following such temporary service. An amount of two dollars and fifty cents per year of creditable service not to exceed a maximum monthly allowance of seventy-five dollars shall be credited monthly to any retired state employee participating in the state health plan established by § 2.1-20.1 or a personal health insurance plan as provided herein. However, such credit shall not exceed the health insurance premium for retiree-only coverage as provided under such personal health insurance plan.

B. Any retired state employee retired under the provisions of §§ 51.1-156 and , § 51.1-209, or § 51.1-307, shall receive the maximum credit provided by this section. In addition, the portion of the health insurance premium paid by any retired state employee who retired under the provisions of § 51.1-156, § 51.1-209, or § 51.1-307 due to injury as defined in § 65.2-101 by accident in the course of employment or by occupational disease as defined in § 65.2-400 shall be subject to increase only to the extent consistent with the health insurance plan administered by the Department of Personnel and Training pursuant to § 2.1-20.1.

BC. 1. For those retired state employees participating in the state health plan, such credit shall be applied to the monthly premium deducted from benefits payable to retired state employees in accordance with Chapters 1 (§ 51.1-100 et seq.), 2 (§ 51.1-200 et seq.) and 3 (§ 51.1-300 et seq.) of Title 51.1. In the event that either no benefit is payable or the benefit payable is insufficient to deduct the entire health care premium, the Virginia Retirement System shall transfer funds in an amount equivalent to the credits that would otherwise have been payable to the Department of Personnel and Training.

2. For those retired state employees electing not to participate in the state health plan and who purchase an alternative personal health insurance policy from a carrier or organization of his own choosing, such retirees shall be eligible to receive a reimbursement equal to the credit in the amount specified in subdivision BC 3. Such reimbursement, not to exceed the actual premium paid, and reduced by the administrative charge for processing the reimbursement, shall be paid upon presentation of documentation satisfactory to the Department of Personnel and Training that the premium for such personal health insurance policy has been paid. Eligibility for reimbursement under this provision shall be determined in a manner prescribed by the Department of Personnel and Training. The retired state employee's election to participate shall be deemed continuing and automatically renewed unless such retiree affirmatively revokes, in writing, his participation. Subject to the limitations of subdivision BC 3, the reimbursement amount shall increase or decrease, in like amount, if the retiree's private health insurance policy premium increases or decreases.

3. The reimbursement shall be in the amount of the credit provided in subsection A or the amount of premium paid for the personal health insurance policy, whichever is less.

4. A retired state employee who fails to elect to participate in the state health plan within thirty-one days of the effective date of retirement, or who, once having elected to participate, discontinues participation, is barred from participating in the state health plan thereafter.

CD. The Virginia Retirement System shall actuarially determine the amount necessary to fund all credits provided by this section and shall reflect the cost of such credits in the employer contribution rate pursuant to § 51.1-145.

§ 2.1-20.1:3. Health insurance credits for retired teachers.

A. A teacher, as defined in § 51.1-101, retired under the Virginia Retirement System who rendered at least fifteen years of total creditable service under the System shall receive a health insurance credit to his monthly retirement allowance, which shall be applied to reduce the retired member's health insurance premium cost, provided the retiree's employer elects to participate in the credit program and sponsors a health insurance plan for its employees and the employee elects to participate in that employer-sponsored plan. The amount of each monthly health insurance credit payable under this section shall be one dollar and fifty cents for each full year of the retired member's creditable service, not to exceed a maximum monthly credit of forty-five dollars;.however, each former.

B. Each member whose retirement was for disability shall receive a monthly health insurance credit of forty-five dollars. In addition, the portion of the health insurance premium paid by any retired teacher who retired under the provisions of § 51.1-156 or a disability retirement plan provided by a locality pursuant to § 51.1-800 due to injury as defined in § 65.2-101 by accident while in the course of employment or by occupational disease as defined in § 65.2-400 shall be subject to increase only to the extent consistent with the health insurance plan administered by the Department of Personnel and Training pursuant to § 2.1-20.1:02.

BC. Each monthly health insurance credit payable under this section shall be paid by the Commonwealth and the employer based on the composite index established in the general appropriation act.

CD. The Virginia Retirement System shall actuarially determine the amount necessary to fund all credits provided under this section and shall reflect the cost of such credits in the applicable employer contribution rate pursuant to § 51.1-145.

DE. Employers who elect to participate in the program by offering an employer-sponsored health insurance plan shall notify the Virginia Retirement System and the Virginia Department of Education at least twelve months prior to the date they elect to commence participation in the program. The effective date of the employer's participation shall correspond with the beginning of the Commonwealth's fiscal year.

§ 2.1-20.1:4. Health insurance credits for local government employees.

A. Retired local government employees, whose localities have elected to participate in the Virginia Retirement System, who have rendered at least fifteen years of total creditable service under the System shall receive a health insurance credit to his monthly retirement allowance, which shall be applied to reduce the retired member's health insurance premium cost, provided the retiree's employer elects to participate in the credit program and sponsors a health insurance plan for its employees and the employee elects to participate in that employer-sponsored plan. The amount of each monthly health insurance credit payable under this section shall be one dollar and fifty cents for each full year of the retired member's creditable service, not to exceed a maximum monthly credit of forty-five dollars; however, each former.

B. Each member whose retirement was for disability shall receive a monthly health insurance credit of forty-five dollars. In addition, the portion of the health insurance premium paid by any retired local government employee or local officer who retired under the provisions of § 51.1-156, § 51.1-209 or § 51.1-813, or a disability retirement plan provided by a locality pursuant to § 51.1-800 due to injury as defined in § 65.2-101 by accident while in the course of employment or by occupational disease as defined in § 65.2-400 shall be subject to increase only to the extent consistent with the health insurance plan administered by the Department of Personnel and Training pursuant to § 2.1-20.1:02.

BC. The monthly health insurance credit payable under this section shall be paid by the locality.

CD. The Virginia Retirement System shall actuarially determine the amount necessary to fund all credits provided under this section and shall reflect the cost of such credits in the applicable employer contribution rate.

DE. Employers who elect to participate in the program by offering an employer-sponsored health insurance plan shall notify the Virginia Retirement System at least twelve months prior to the date such employers elect to commence participation in the program. The effective date of the employer's participation shall correspond with the beginning of the Commonwealth's fiscal year.

§ 15.1-7.3. Insurance for employees, retired employees, and disability retirees of local governments and other local governmental entities.

A. The governing body of every county, city, or town may provide for their officers and employees, and employees of boards, commissions, agencies and authorities created by or controlled by such county, city or town, group life, accident, and health insurance programs. Such programs may be through a program of self-insurance, purchased insurance, or partial self-insurance and purchased insurance, whichever is determined to be the most cost effective. The total cost of such policies or protection may be paid entirely by the local government or shared with the employee.

B. The governing body of every county, city, and town may provide for its retired officers and retired employees to be eligible for such group life, accident, and health insurance programs. The cost of such insurance for retired officers and retired employees may be paid in whole or in part by the locality.

C. In the event a county or city elects to provide one or more of such programs for its officers and employees, it shall provide such programs to the constitutional officers and their employees on the same basis as provided to other officers and employees, unless the constitutional officers and employees are covered under a state program, and the cost of such local program shall be borne entirely by the locality or shared with the employee.

D. Except as otherwise provided herein, in the event the governing body of any county, city or town elects to provide group accident and health insurance for its officers and employees, including constitutional officers and their employees, such programs shall require that upon retirement, or upon the effective date of this provision for those who have previously retired, any such individual with (i) at least fifteen years of continuous employment with the county, city, or town, or (ii) less than fifteen years of continuous employment who has retired due to line-of-duty injuries may choose to continue his coverage with the insurer at the retiree's expense until such individual attains sixty-five years of age at the insurer's customary premium rate applicable to: (i) to such policies, (ii) to the class of risk to which the person then belongs, and (iii) to his age.

E. The governing body, when providing this coverage, may further provide that the retiree be rated separately from the active employees covered under the group plan offered by such governing body. The provisions of the preceding paragraph shall not apply in any jurisdiction with a population of less than 30,000 which has made a written determination, following bona fide attempts to obtain such coverage for retirees, that (i) such coverage is not commercially available for retirees as a separately rated group or class and (ii) inclusion of retirees in the group or class of active employees would have the effect of materially increasing premium rates applicable to the group or class of active employees.

F. The governing body, when providing this coverage, shall increase the portion of the health insurance premium paid by any retired officer or employee who retired under the provisions of § 51.1-156, § 51.1-209 or § 51.1-813, or a disability retirement plan provided by a locality pursuant to § 51.1-800 due to injury as defined in § 65.2-101 by accident while in the course of employment or by occupational disease as defined in § 65.2-400 only to the extent consistent with health insurance coverage under subsection B of this section.

G. The governing body, when providing this coverage, shall also provide for the purchase of continued coverage hereunder consistent with the provisions of (i) § 2.1-20.1:03, for a local employee or officer who becomes permanently and totally incapacitated while in the course of employment and (ii) § 2.1-20.1:04, for the surviving spouse and any dependents of a local employee or officer who dies while in the course of employment.

I. Nothing herein shall prohibit a local governing body from providing group accident and health coverage or benefits for its retirees in addition to that which is required under this section.