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Sub. H. B. No. 185As Reported by the Senate Insurance, Commerce and Labor CommitteeAs Reported by the Senate Insurance, Commerce and Labor Committee
125th General Assembly | Regular Session | 2003-2004 |
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REPRESENTATIVES Schmidt, Allen, Setzer, Seitz, Aslanides, C. Evans, Olman, Schneider, Schaffer, Raga, Webster, Buehrer, Skindell, Beatty, Brown, Chandler, Cirelli, Collier, Daniels, DeBose, Domenick, Hartnett, Harwood, Hughes, Jolivette, Key, Miller, Otterman, S. Patton, Perry, Price, Redfern, Reidelbach, Seaver, S. Smith, D. Stewart, J. Stewart, Strahorn, Yates
A BILL
To amend sections 9.833, 124.84, 124.841, and 505.60 of the
Revised Code to permit the state and political
subdivisions to pay some or all of the premium for
their employees' long-term care insurance and to permit public officials and employees of political subdivisions to serve on the governing body of a joint self-insurance program of which the subdivision is a member.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 9.833, 124.84, 124.841, and 505.60 of the
Revised Code be amended to read as follows:
Sec. 9.833. (A) As used in this section, "political
subdivision" means a municipal corporation, township, county,
school district, or other body corporate and politic responsible
for governmental activities in a geographic area smaller than
that of the state. (B) Political subdivisions that provide health care
benefits for their officers or employees may do any of the
following: (1) Establish and maintain an individual self-insurance
program with public moneys to provide authorized health care
benefits, including but not limited to, health care, prescription drugs, dental care, and vision care, in accordance with division (C) of this section; (2) After establishing an individual self-insurance
program, agree with other political subdivisions that have
established individual self-insurance programs for health care
benefits, that their programs will be jointly administered in a
manner specified in the agreement; (3) Pursuant to a written agreement and in accordance with
division (C) of this section, join in any combination with other
political subdivisions to establish and maintain a joint
self-insurance program to provide health care benefits; (4) Pursuant to a written agreement, join in any
combination with other political subdivisions to procure or
contract for policies, contracts, or plans of insurance to
provide health care benefits for their officers and employees
subject to the agreement; (5) Use in any combination any of the policies, contracts,
plans, or programs authorized under this division. (C) Except as otherwise provided in division (E) of this
section, the following apply to individual or joint
self-insurance programs established pursuant to this section: (1) Such funds shall be reserved as are necessary, in the
exercise of sound and prudent actuarial judgment, to cover
potential cost of health care benefits for the officers and
employees of the political subdivision. A report of amounts so
reserved and disbursements made from such funds, together with a
written report of a member of the American academy of actuaries
certifying whether the amounts reserved conform to the
requirements of this division, are computed in accordance with
accepted loss reserving standards, and are fairly stated in
accordance with sound loss reserving principles, shall be
prepared and maintained, within ninety days after the last day of
the fiscal year of the entity for which the report is provided
for that fiscal year, in the office of the program administrator
described in division (C)(3) of this section. The report required by division (C)(1) of this section
shall include, but not be limited to, disbursements made for the
administration of the pool program, including claims paid, costs of the
legal representation of political subdivisions and employees, and
fees paid to consultants. The program administrator described in division (C)(3) of
this section shall make the report required by this division
available for inspection by any person at all reasonable times
during regular business hours, and, upon the request of such
person, shall make copies of the report available at cost within
a reasonable period of time. (2) Each political subdivision shall reserve funds
necessary for an individual or joint self-insurance program in a
special fund that may be established pursuant to an ordinance or
resolution of the political subdivision and not subject to
section 5705.12 of the Revised Code. The political subdivision
may allocate the costs of insurance or any self-insurance
program, or both, among the funds or accounts in the
subdivision's treasury on the basis of relative exposure and loss
experience. (3) A contract may be awarded, without the necessity of
competitive bidding, to any person, political subdivision,
nonprofit corporation organized under Chapter 1702. of the
Revised Code, or regional council of governments created under
Chapter 167. of the Revised Code for purposes of administration
of an individual or joint self-insurance program. No such
contract shall be entered into without full, prior, public
disclosure of all terms and conditions. The disclosure shall
include, at a minimum, a statement listing all representations
made in connection with any possible savings and losses resulting
from the contract, and potential liability of any political
subdivision or employee. The proposed contract and statement
shall be disclosed and presented at a meeting of the political
subdivision not less than one week prior to the meeting at which
the political subdivision authorizes the contract. A contract awarded to a nonprofit corporation or a regional council of governments under this division may provide that all employees of the nonprofit corporation or regional council of governments and the employees of all entities related to the nonprofit corporation or regional council of governments may be covered by the individual or joint self-insurance program under the terms and conditions set forth in the contract. (4) The individual or joint self-insurance program shall
include a contract with a member of the American academy of
actuaries for the preparation of the written evaluation of the
reserve funds required under division (C)(1) of this section. (5) A joint self-insurance program may allocate the costs
of funding the program among the funds or accounts in the
treasuries of the participating political subdivisions on the
basis of their relative exposure and loss experience. (6) An individual self-insurance program may allocate the costs of funding
the
program among the funds or accounts in the treasury of the political
subdivision that established the program. (7) Two or more political subdivisions may also authorize
the establishment and maintenance of a joint health care cost
containment program, including, but not limited to, the employment
of risk managers, health care cost containment specialists, and
consultants, for the purpose of preventing and reducing health
care costs covered by insurance, individual self-insurance, or joint
self-insurance programs. (8) A political subdivision is not liable under a joint
self-insurance program for any amount in excess of amounts
payable pursuant to the written agreement for the participation
of the political subdivision in the joint self-insurance program.
Under a joint self-insurance program agreement, a political
subdivision may, to the extent permitted under the written
agreement, assume the risks of any other political subdivision.
A joint self-insurance program established under this section is
deemed a separate legal entity for the public purpose of enabling
the members of the joint self-insurance program to obtain
insurance or to provide for a formalized, jointly administered
self-insurance fund for its members. An entity created pursuant
to this section is exempt from all state and local taxes. (9) Any political subdivision may issue general obligation
bonds, or special obligation bonds that are not payable from
real or personal property taxes, and may also issue notes in
anticipation of such bonds, pursuant to an ordinance or
resolution of its legislative authority or other governing body
for the purpose of providing funds to pay expenses associated
with the settlement of claims, whether by way of a reserve or
otherwise, and to pay the political subdivision's portion of the
cost of establishing and maintaining an individual or joint
self-insurance program or to provide for the reserve in the
special fund authorized by division (C)(2) of this section. In its ordinance or resolution authorizing bonds or notes
under this section, a political subdivision may elect to issue
such bonds or notes under the procedures set forth in Chapter
133. of the Revised Code. In the event of such an election,
notwithstanding Chapter 133. of the Revised Code, the maturity of
the bonds may be for any period authorized in the ordinance or
resolution not exceeding twenty years, which period shall be the
maximum maturity of the bonds for purposes of section 133.22 of
the Revised Code. Bonds and notes issued under this section shall not be
considered in calculating the net indebtedness of the political
subdivision under sections 133.04, 133.05, 133.06, and 133.07 of
the Revised Code. Sections 9.98 to 9.983 of the Revised Code are
hereby made applicable to bonds or notes authorized under this
section. (10) A joint self-insurance program is not an insurance
company. Its operation does not constitute doing an insurance
business and is not subject to the insurance laws of this state. (D) A political subdivision may procure group life insurance for its employees in conjunction with an individual or joint self-insurance program authorized by this section, provided that the policy of group life insurance is not self-insured. (E) Divisions (C)(1), (2), and (4) of this section do not
apply to individual self-insurance programs in municipal
corporations, townships, or counties. (F) A public official or employee of a political subdivision who is or becomes a member of the governing body of the program administrator of a joint self-insurance program in which the political subdivision participates is not in violation of division (D) or (E) of section 102.03, division (C) of section 102.04, or section 2921.42 of the Revised Code as a result of either of the following: (1) The political subdivision's entering under this section into the written agreement to participate in the joint self-insurance program; (2) The political subdivision's entering under this section into any other contract with the joint self-insurance program.
Sec. 124.84. (A) The department of administrative
services,
in consultation with the superintendent of insurance
and subject
to division (D) of this section, shall negotiate and
contract with
one or more insurance companies or
health
insuring corporations
authorized to operate or do business in this state
for the
purchase of a
policy of long-term care insurance covering all
state employees
who are paid directly by warrant of the auditor of
state,
including elected state officials. Any policy purchased
under
this division shall be negotiated and entered into in
accordance
with the competitive selection procedures specified in
Chapter 125. of the Revised Code. As used in this section,
"long-term care insurance" has the same meaning as in section
3923.41 of the Revised Code. (B) Any elected state official or state employee paid
directly by warrant of the auditor of state may elect to
participate in any long-term care insurance policy purchased
under
division (A) of this section
and any official or employee
who does
so shall be responsible for paying the entire premium
charged,
which shall be deducted from the official's or
employee's salary
or wage and be
remitted by the auditor of state directly to the
insurance
company or health insuring corporation. All or any
portion of the premium charged may be paid by the state.
Participation in the policy may
include the dependents and family
members of the elected state
official or state employee. If a participant in a long-term care insurance policy
leaves
employment, the participant and
the participant's dependents and
family members
may, at their election, continue to participate in
a policy
established under this section
in the same manner as if
the
participant had not left employment. The manner of payment
and the portion of premium charged the participant, dependent, and family member shall be
established pursuant to division (E) of this section. (C) Any long-term care insurance policy purchased under
this
section or section 124.841 or 145.581 of the Revised Code
shall
provide for all of the following with respect to the
premiums
charged for the policy: (1) They shall be set at the entry age of the official or
employee when first covered by the policy and shall not increase
except as a class during coverage under the policy. (2) They shall be based on the class of all officials or
employees covered by the policy. (3) They shall continue, pursuant to section 145.581 of
the
Revised Code, after the retirement of the official or
employee who
is covered under the policy, at the rate in effect
on the date of
the official's or employee's retirement. (D) Prior to entering into a contract with an insurance
company or health insuring corporation for the purchase of a
long-term
care
insurance policy under this section, the department
shall request
the superintendent of insurance to certify the
financial
condition of the company or corporation. The
department
shall not enter into the contract if, according to
that
certification, the company or corporation is insolvent, is
determined by the superintendent to be
potentially
unable to
fulfill its contractual obligations, or is placed under
an order
of rehabilitation or conservation by a court of
competent
jurisdiction or under an order of supervision by the
superintendent. (E) The department shall adopt rules in accordance with
section 111.15 of the Revised Code governing long-term care
insurance purchased under this section.
The rules shall
establish
methods of payment for participation under this
section, which may
include establishment of a payroll deduction
plan
All or any
portion of the premium charged the participants, dependents, and family members shall be paid in such manner or
combination of manners as the department determines.
Sec. 124.841. (A) As used in this section: (1) "Long-term care insurance" has the same meaning as in
section 3923.41 of the Revised Code. (2) "Political subdivision" has the same meaning as in
section 9.833 of the Revised Code. (B) Any political subdivision may negotiate with and may
contract with one or more insurance companies or
health insuring
corporations authorized to operate or do business in this
state
for the
purchase of a policy of long-term care insurance covering
all elected
officials
and employees of the political subdivision.
The contract may be
entered into without competitive bidding. Any
elected official
or employee of a political subdivision may elect
to participate
in any long-term care insurance policy that the
political
subdivision purchases under this division
and any
official or
employee who does so shall be responsible for paying
the entire
premium charged, which shall be deducted from the
official's or
employee's salary or wage and be remitted directly
to the insurance
company or health insuring corporation. (C) Any long-term care insurance policy entered into under
this section is subject to division (C) of section 124.84 of the
Revised Code.
(D) All or any portion of the premium charged may be paid by
the political subdivision. The political subdivision shall
establish a manner or manners of payment for participants and the
political subdivision.
Sec. 505.60. (A) As provided in this section and section
505.601 of the Revised Code, the board of township trustees of any
township may procure and pay all or any part of the cost of
insurance policies that may provide benefits for hospitalization,
surgical care, major medical care, disability, dental care, eye
care, medical care, hearing aids, prescription drugs, or sickness
and accident insurance, or a combination of any of the foregoing
types of insurance for township officers and employees.
The board
of township trustees of any township may negotiate and contract
for the purchase of a policy of long-term care insurance for
township officers and employees pursuant to section 124.841 of the
Revised Code. (B) If the board procures any insurance
policies under this
section, the board shall
provide uniform coverage under these
policies for township
officers and full-time township employees
and their immediate
dependents, and may provide coverage under
these policies for
part-time township employees and their
immediate dependents, from
the funds or budgets from which the
officers or employees are
compensated for services, such policies
to be
issued by an insurance company duly authorized
to do
business in this state. Any township officer or employee
may
refuse to accept the insurance coverage without affecting the
availability of such insurance coverage to other township
officers
and employees. The board may also contract for group health
care services
with health insuring corporations
holding certificates of
authority under Chapter
1751. of the Revised Code
for township
officers and employees. If the board so contracts,
it shall
provide uniform coverage under any such contracts for
township
officers and full-time township employees and their
immediate
dependents and may provide coverage under such
contracts for
part-time township employees and their immediate
dependents,
provided that each officer and employee so covered is
permitted
to: (1) Choose between a plan offered by an insurance company
and a plan
offered by a health insuring corporation, and provided
further that the
officer or employee pays any amount by which the
cost of the
plan chosen
exceeds the cost of the plan offered by
the board under this
section; (2) Change the choice made under
division (B) of this
section
at a time each year as determined in advance by the board. An addition of a class or change of definition of coverage
to
the plan offered by the board may be made at any time that it
is
determined by the board to be in the best interest of the
township. If the total cost to the township of the revised plan
for any trustee's coverage does not exceed that cost under the
plan in effect during the prior policy year, the revision of the
plan does not cause an increase in that trustee's compensation. (C) If any township officer or employee is denied coverage
under
a health care plan procured under division (B) of this
section or if
any township officer or employee elects not to
participate in the township's
health care plan, the township
may
reimburse the officer or employee for each out-of-pocket premium
that the
officer or employee incurs for insurance
policies
described in division (A) of this section that the
officer or
employee otherwise obtains, but not to exceed an amount equal to
the average premium
paid by the township for its officers and
employees under policies it procures
under
division (B) of this
section.
(D) The board may provide the benefits authorized under this
section, without competitive bidding, by contributing to a health
and welfare trust fund administered through or in conjunction
with
a collective bargaining representative of the township
employees. The board may also provide the benefits described in this
section through an individual self-insurance program or a joint
self-insurance program as provided in section 9.833 of the
Revised
Code. (E) If a board of township trustees fails to pay one or
more
premiums for a policy, contract, or plan of insurance or
health
care services authorized by division (A) or (B) of this
section
and the failure causes a lapse, cancellation, or other
termination
of coverage under the policy, contract, or plan, it
may reimburse
a township officer or employee for, or pay on
behalf of the
officer or employee, any expenses incurred that
would have been
covered under the policy, contract, or plan. (F) As used in this section and
section 505.601 of the
Revised Code: (1) "Part-time township employee" means a township employee
who is
hired with the expectation that
the employee will work not
more than one thousand five hundred hours in any
year. (2) "Premium" does not include any deductible or health care
costs paid directly by a township officer or employee.
Section 2. That existing sections 9.833, 124.84, 124.841, and 505.60
of the Revised Code are hereby repealed.
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