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| Public Act 097-0386 | ||||
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AN ACT concerning government.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The State Employees Group Insurance Act of 1971 | ||||
is amended by changing Section 6.5 as follows:
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(5 ILCS 375/6.5)
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Sec. 6.5. Health benefits for TRS benefit recipients and | ||||
TRS dependent
beneficiaries.
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(a) Purpose. It is the purpose of this amendatory Act of | ||||
1995 to transfer
the administration of the program of health | ||||
benefits established for benefit
recipients and their | ||||
dependent beneficiaries under Article 16 of the Illinois
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Pension Code to the Department of Central Management Services.
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(b) Transition provisions. The Board of Trustees of the | ||||
Teachers'
Retirement System shall continue to administer the | ||||
health benefit program
established under Article 16 of the | ||||
Illinois Pension Code through December 31,
1995. Beginning | ||||
January 1, 1996, the Department of Central Management Services
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shall be responsible for administering a program of health | ||||
benefits for TRS
benefit recipients and TRS dependent | ||||
beneficiaries under this Section.
The Department of Central | ||||
Management Services and the Teachers' Retirement
System shall | ||||
cooperate in this endeavor and shall coordinate their | ||||
activities
so as to ensure a smooth transition and | ||
uninterrupted health benefit coverage.
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(c) Eligibility. All persons who were enrolled in the | ||
Article 16 program at
the time of the transfer shall be | ||
eligible to participate in the program
established under this | ||
Section without any interruption or delay in coverage
or | ||
limitation as to pre-existing medical conditions. Eligibility | ||
to
participate shall be determined by the Teachers' Retirement | ||
System.
Eligibility information shall be communicated to the | ||
Department of Central
Management Services in a format | ||
acceptable to the Department.
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A TRS dependent beneficiary who is an unmarried child age | ||
19 or over and
mentally or physically disabled does not become | ||
ineligible to participate
by reason of (i) becoming ineligible | ||
to be claimed as a dependent for Illinois
or federal income tax | ||
purposes or (ii) receiving earned income, so long as
those | ||
earnings are insufficient for the child to be fully | ||
self-sufficient.
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(d) Coverage. The level of health benefits provided under | ||
this Section
shall be similar to the level of benefits provided | ||
by the
program previously established under Article 16 of the | ||
Illinois Pension Code.
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Group life insurance benefits are not included in the | ||
benefits
to be provided to TRS benefit recipients and TRS | ||
dependent beneficiaries under
this Act.
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The program of health benefits under this Section may | ||
include any or all of
the benefit limitations, including but | ||
not limited to a reduction in benefits
based on eligibility for | ||
federal medicare benefits, that are provided under
subsection | ||
(a) of Section 6 of this Act for other health benefit programs | ||
under
this Act.
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(e) Insurance rates and premiums. The Director shall | ||
determine the
insurance rates and premiums for TRS benefit | ||
recipients and TRS dependent
beneficiaries,
and shall present | ||
to the Teachers' Retirement System of
the State of Illinois, by | ||
April 15 of each calendar year, the rate-setting
methodology | ||
(including but not limited to utilization levels and costs) | ||
used
to determine the amount of the health care premiums.
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For Fiscal Year 1996, the premium shall be equal to the | ||
premium actually
charged in Fiscal Year 1995; in subsequent | ||
years, the premium shall
never be lower than the premium | ||
charged in Fiscal Year 1995. | ||
For Fiscal Year
2003, the premium shall not exceed 110% | ||
of the premium actually charged in
Fiscal Year 2002. | ||
For Fiscal Year 2004, the premium shall not exceed 112% | ||
of
the premium actually charged in Fiscal Year 2003.
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For Fiscal Year 2005, the premium shall not exceed a | ||
weighted average of 106.6% of
the premium actually charged | ||
in Fiscal Year 2004.
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For Fiscal Year 2006, the premium shall not exceed a | ||
weighted average of 109.1% of
the premium actually charged | ||
in Fiscal Year 2005.
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For Fiscal Year 2007, the premium shall not exceed a | ||
weighted average of 103.9% of
the premium actually charged | ||
in Fiscal Year 2006.
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For Fiscal Year 2008 and thereafter, the premium in | ||
each fiscal year shall not exceed 105% of
the premium | ||
actually charged in the previous fiscal year.
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Rates and premiums may be based in part on age and | ||
eligibility for federal
medicare coverage. However, the cost of | ||
participation for a TRS dependent
beneficiary who is an | ||
unmarried child age 19 or over and mentally or physically
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disabled shall not exceed the cost for a TRS dependent | ||
beneficiary who is
an unmarried child under age 19 and | ||
participates in the same major medical or
managed care program.
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The cost of health benefits under the program shall be paid | ||
as follows:
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(1) For a TRS benefit recipient selecting a managed | ||
care program, up to
75% of the total insurance rate shall | ||
be paid from the Teacher Health Insurance
Security Fund. | ||
Effective with Fiscal Year 2007 and thereafter, for a TRS | ||
benefit recipient selecting a managed care program, 75% of | ||
the total insurance rate shall be paid from the Teacher | ||
Health Insurance
Security Fund.
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(2) For a TRS benefit recipient selecting the major | ||
medical coverage
program, up to 50% of the total insurance | ||
rate shall be paid from the Teacher
Health Insurance | ||
Security Fund if a managed care program is accessible, as
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determined by the Teachers' Retirement System. Effective | ||
with Fiscal Year 2007 and thereafter, for a TRS benefit | ||
recipient selecting the major medical coverage
program, | ||
50% of the total insurance rate shall be paid from the | ||
Teacher
Health Insurance Security Fund if a managed care | ||
program is accessible, as
determined by the Department of | ||
Central Management Services.
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(3) For a TRS benefit recipient selecting the major | ||
medical coverage
program, up to 75% of the total insurance | ||
rate shall be paid from the Teacher
Health Insurance | ||
Security Fund if a managed care program is not accessible, | ||
as
determined by the Teachers' Retirement System. | ||
Effective with Fiscal Year 2007 and thereafter, for a TRS | ||
benefit recipient selecting the major medical coverage
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program, 75% of the total insurance rate shall be paid from | ||
the Teacher
Health Insurance Security Fund if a managed | ||
care program is not accessible, as
determined by the | ||
Department of Central Management Services.
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(3.1) For a TRS dependent beneficiary who is Medicare | ||
primary and enrolled in a managed care plan, or the major | ||
medical coverage program if a managed care plan is not | ||
available, 25% of the total insurance rate shall be paid | ||
from the Teacher Health Security Fund as determined by the | ||
Department of Central Management Services. For the purpose | ||
of this item (3.1), the term "TRS dependent beneficiary who | ||
is Medicare primary" means a TRS dependent beneficiary who | ||
is participating in Medicare Parts A and B.
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(4) Except as otherwise provided in item (3.1), the
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balance of the rate of insurance, including the entire | ||
premium of
any coverage for TRS dependent beneficiaries | ||
that has been elected, shall be
paid
by deductions | ||
authorized by the TRS benefit recipient to be withheld from | ||
his
or her monthly annuity or benefit payment from the | ||
Teachers' Retirement System;
except that (i) if the balance | ||
of the cost of coverage exceeds the amount of
the monthly | ||
annuity or benefit payment, the difference shall be paid | ||
directly
to the Teachers' Retirement System by the TRS | ||
benefit recipient, and (ii) all
or part of the balance of | ||
the cost of coverage may, at the school board's
option, be | ||
paid to the Teachers' Retirement System by the school board | ||
of the
school district from which the TRS benefit recipient | ||
retired, in accordance
with Section 10-22.3b of the School | ||
Code. The Teachers' Retirement System
shall promptly | ||
deposit all moneys withheld by or paid to it under this
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subdivision (e)(4) into the Teacher Health Insurance | ||
Security Fund. These
moneys shall not be considered assets | ||
of the Retirement System.
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(f) Financing. Beginning July 1, 1995, all revenues arising | ||
from the
administration of the health benefit programs | ||
established under Article 16 of
the Illinois Pension Code or | ||
this Section shall be deposited into the
Teacher Health | ||
Insurance Security Fund, which is hereby created as a
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nonappropriated trust fund to be held outside the State | ||
Treasury, with the
State Treasurer as custodian. Any interest | ||
earned on moneys in the Teacher
Health Insurance Security Fund | ||
shall be deposited into the Fund.
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Moneys in the Teacher Health Insurance Security
Fund shall | ||
be used only to pay the costs of the health benefit program
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established under this Section, including associated | ||
administrative costs, and
the costs associated with the health | ||
benefit program established under Article
16 of the Illinois | ||
Pension Code, as authorized in this Section. Beginning
July 1, | ||
1995, the Department of Central Management Services may make
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expenditures from the Teacher Health Insurance Security Fund | ||
for those costs.
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After other funds authorized for the payment of the costs | ||
of the health
benefit program established under Article 16 of | ||
the Illinois Pension Code are
exhausted and until January 1, | ||
1996 (or such later date as may be agreed upon
by the Director | ||
of Central Management Services and the Secretary of the
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Teachers' Retirement System), the Secretary of the Teachers' | ||
Retirement System
may make expenditures from the Teacher Health | ||
Insurance Security Fund as
necessary to pay up to 75% of the | ||
cost of providing health coverage to eligible
benefit | ||
recipients (as defined in Sections 16-153.1 and 16-153.3 of the
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Illinois Pension Code) who are enrolled in the Article 16 | ||
health benefit
program and to facilitate the transfer of | ||
administration of the health benefit
program to the Department | ||
of Central Management Services.
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The Department of Healthcare and Family Services, or any | ||
successor agency designated to procure healthcare contracts | ||
pursuant to this Act, is authorized to establish funds, | ||
separate accounts provided by any bank or banks as defined by | ||
the Illinois Banking Act, or separate accounts provided by any | ||
savings and loan association or associations as defined by the | ||
Illinois Savings and Loan Act of 1985 to be held by the | ||
Director, outside the State treasury, for the purpose of | ||
receiving the transfer of moneys from the Teacher Health | ||
Insurance Security Fund. The Department may promulgate rules | ||
further defining the methodology for the transfers. Any | ||
interest earned by moneys in the funds or accounts shall inure | ||
to the Teacher Health Insurance Security Fund. The transferred | ||
moneys, and interest accrued thereon, shall be used exclusively | ||
for transfers to administrative service organizations or their | ||
financial institutions for payments of claims to claimants and | ||
providers under the self-insurance health plan. The | ||
transferred moneys, and interest accrued thereon, shall not be | ||
used for any other purpose including, but not limited to, | ||
reimbursement of administration fees due the administrative | ||
service organization pursuant to its contract or contracts with | ||
the Department.
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(g) Contract for benefits. The Director shall by contract, | ||
self-insurance,
or otherwise make available the program of | ||
health benefits for TRS benefit
recipients and their TRS | ||
dependent beneficiaries that is provided for in this
Section. | ||
The contract or other arrangement for the provision of these | ||
health
benefits shall be on terms deemed by the Director to be | ||
in the best interest of
the State of Illinois and the TRS | ||
benefit recipients based on, but not limited
to, such criteria | ||
as administrative cost, service capabilities of the carrier
or | ||
other contractor, and the costs of the benefits.
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(g-5) Committee. A Teacher Retirement Insurance Program | ||
Committee shall be established, to consist of 10 persons | ||
appointed by the Governor.
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The Committee shall convene at least 4 times each year, and | ||
shall consider and make recommendations on issues affecting the | ||
program of health benefits provided under this
Section. | ||
Recommendations of the Committee shall be based on a consensus | ||
of the members of the Committee.
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If the Teacher
Health Insurance Security Fund experiences a | ||
deficit balance based upon the contribution and subsidy rates | ||
established in this Section and Section 6.6 for Fiscal Year | ||
2008 or thereafter, the Committee shall make recommendations | ||
for adjustments to the funding sources established under these | ||
Sections. | ||
In addition, the Committee shall identify proposed | ||
solutions to the funding shortfalls that are affecting the | ||
Teacher Health Insurance Security Fund, and it shall report | ||
those solutions to the Governor and the General Assembly within | ||
6 months after the effective date of this amendatory Act of the | ||
97th General Assembly. | ||
(h) Continuation of program. It is the intention of
the | ||
General Assembly that the program of health benefits provided | ||
under this
Section be maintained on an ongoing, affordable | ||
basis.
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The program of health benefits provided under this Section | ||
may be amended by
the State and is not intended to be a pension | ||
or retirement benefit subject to
protection under Article XIII, | ||
Section 5 of the Illinois Constitution.
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(i) Repeal. (Blank).
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(Source: P.A. 95-632, eff. 9-25-07.)
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Section 99. Effective date. This Act takes effect upon | ||
becoming law.
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