By: Truan, et al. S.B. No. 404 A BILL TO BE ENTITLED AN ACT 1-1 relating to the right of certain municipal and county employees to 1-2 purchase a continuation of health benefits coverage at retirement. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Subtitle C, Title 5, Local Government Code, is 1-5 amended by adding Chapter 174 to read as follows: 1-6 CHAPTER 174. RIGHT OF CERTAIN MUNICIPAL AND COUNTY 1-7 EMPLOYEES TO PURCHASE CONTINUED HEALTH COVERAGE AT RETIREMENT 1-8 Sec. 174.001. APPLICABILITY. This chapter applies to a 1-9 person who is leaving county employment in a county with a 1-10 population of 75,000 or more or municipal employment in a 1-11 municipality with a population of 10,000 or more. 1-12 Sec. 174.002. RIGHT TO PURCHASE CONTINUED COVERAGE. (a) A 1-13 person to whom this chapter applies who retires or has enough 1-14 credit in the governmental retirement plan that covers the person 1-15 to be able to retire with full benefits at an attained age is 1-16 entitled to purchase continued health benefits coverage for the 1-17 person and the person's dependents as provided by this chapter. 1-18 The coverage shall be provided under the group health insurance 1-19 plan or group health coverage plan provided by or through the 1-20 employing county or municipality to its employees. If the plan 1-21 that provided coverage while the person was employed by the county 1-22 or municipality is terminated, the coverage shall be provided under 1-23 the successor to that plan. 2-1 (b) To receive continued coverage under this chapter, the 2-2 person must inform the employing county or municipality, not later 2-3 than the 90th day after the date the person leaves employment with 2-4 the county or municipality, that the person elects to continue 2-5 coverage. 2-6 Sec. 174.003. LEVEL OF COVERAGE. (a) The person may elect 2-7 to cover the same persons who were covered under the county's or 2-8 municipality's group health insurance plan or group health coverage 2-9 plan through the person at the time the person left county or 2-10 municipal employment, or the person may elect to discontinue 2-11 coverage for one or more persons. A person who was not covered 2-12 under the plan at the time the person to whom this chapter applies 2-13 left county or municipal employment is not eligible for coverage 2-14 under this chapter. 2-15 (b) Except as provided by Subsections (c) and (d), the level 2-16 of coverage provided under this chapter at any given time is the 2-17 same level of coverage provided to current employees of the county 2-18 or municipality at that time. 2-19 (c) A county or municipality may substitute Medicare 2-20 supplement health benefits coverage as the coverage provided for a 2-21 person who receives health benefits coverage under this chapter, 2-22 including a dependent, after the date that the person becomes 2-23 eligible for federal Medicare benefits. 2-24 (d) The person may elect to continue coverage at a reduced 2-25 level, if offered by the county or municipality. 3-1 Sec. 174.004. PAYMENT FOR COVERAGE. A person who is 3-2 entitled to continued coverage under this chapter is entitled to 3-3 make payments for the coverage at the same time and to the same 3-4 entity that payments for the coverage are made by current employees 3-5 of the county or municipality. 3-6 Sec. 174.005. DUTY TO INFORM RETIREE OF RIGHTS. A county 3-7 and a municipality shall provide written notice to a person to whom 3-8 this chapter may apply of the person's rights under this chapter 3-9 not later than the date the person leaves employment with the 3-10 county or municipality. 3-11 Sec. 174.006. CERTAIN MATTERS NOT AFFECTED. This chapter 3-12 does not: 3-13 (1) prohibit a county or municipality from uniformly 3-14 changing the group health insurance plan or group health coverage 3-15 plan provided for its employees and retirees; 3-16 (2) affect the definition of a dependent or the 3-17 eligibility requirements for a dependent under a plan, except as 3-18 provided by Section 174.003(c); 3-19 (3) prohibit a county or municipality from agreeing 3-20 with a person to deduct the cost of coverage provided under this 3-21 chapter from a pension check; 3-22 (4) prohibit a county or municipality from increasing 3-23 the cost of group health coverage to its employees and to persons 3-24 covered under this chapter to reflect the increased cost, if any, 3-25 attributable to compliance with this chapter; 4-1 (5) affect the right of a county or municipality to 4-2 provide coverage under Chapter 172; or 4-3 (6) affect the right of a county or municipality to 4-4 offer the coverage at the same rate that is available to active 4-5 employees or to offer the coverage at a reasonable rate established 4-6 for retirees that may be greater than the rate offered to active 4-7 employees. 4-8 Sec. 174.007. EXEMPTIONS. (a) A county or municipality 4-9 that does not provide health benefits coverage through a 4-10 self-insured plan or a plan authorized under Chapter 172 is not 4-11 required to provide coverage under this chapter if: 4-12 (1) the county or municipality makes a good faith 4-13 effort to purchase insurance coverage that includes coverage 4-14 required by this chapter from an insurance company authorized to do 4-15 business in this state but is unable to find a provider for the 4-16 coverage; or 4-17 (2) the majority of the employees of a county or 4-18 municipality vote by secret ballot to be exempted from this 4-19 chapter. 4-20 (b) If the majority of the employees of a county or 4-21 municipality vote to be exempted from this chapter as provided by 4-22 Subsection (a), a new election shall be held not earlier than the 4-23 first anniversary of the preceding election if at least 20 percent 4-24 of the employees petition the presiding officer of the county or 4-25 municipality for a new election. 5-1 SECTION 2. (a) Chapter 174, Local Government Code, as added 5-2 by this Act, applies according to its terms to all eligible persons 5-3 who leave county or municipal employment on or after October 1, 5-4 1993. In addition, notwithstanding Subsection (b), Section 5-5 174.002, Local Government Code, as added by this Act, a person who 5-6 leaves county or municipal employment before September 1, 1993, is 5-7 entitled to purchase continued health benefits coverage in 5-8 accordance with Chapter 174, Local Government Code, as added by 5-9 this Act, if: 5-10 (1) the person is purchasing health coverage for the 5-11 person or for the person's dependents from or through the county or 5-12 municipality on September 1, 1993; and 5-13 (2) the person informs the employing county or 5-14 municipality, before December 1, 1993, that the person elects to 5-15 purchase continued coverage as provided by Chapter 174, Local 5-16 Government Code, as added by this Act. 5-17 (b) A county or municipality that is required by Chapter 5-18 174, Local Government Code, as added by this Act, to provide 5-19 continued health benefits coverage but that is not allowed to 5-20 provide the coverage under the terms of the county's or 5-21 municipality's existing group health plan shall ensure that the 5-22 required continued health benefits coverage is provided for in any 5-23 plan that is adopted, amended, or renewed by the county or 5-24 municipality on or after September 1, 1993, unless the county or 5-25 municipality is exempted under Section 174.007, Local Government 6-1 Code, as added by this Act. The period during which a person must 6-2 inform a county or municipality that the person elects to continue 6-3 health benefits coverage under Chapter 174, Local Government Code, 6-4 as added by this Act, is extended by the amount of time that occurs 6-5 after the date that the person leaves county or municipal 6-6 employment and before the date that the person receives written 6-7 notice from the county or municipality that the person is presently 6-8 able to purchase the continued health benefits coverage required to 6-9 be provided under Chapter 174, Local Government Code, as added by 6-10 this Act. 6-11 SECTION 3. This Act takes effect September 1, 1993. 6-12 SECTION 4. The importance of this legislation and the 6-13 crowded condition of the calendars in both houses create an 6-14 emergency and an imperative public necessity that the 6-15 constitutional rule requiring bills to be read on three several 6-16 days in each house be suspended, and this rule is hereby suspended.