House of Representatives

SB1107

retirees; health insurance; subsidies

Sponsors: Arzberger, Mitchell, Bee, et al

 

DPA

Committee on Financial Institutions & Insurance

DP

Committee on Appropriations

X

Caucus and COW

 

 

As Passed the House

 

SB 1107 authorizes a temporary health and accident insurance premium payment increase for nonservice area retired members of the Arizona State Retirement System (ASRS), Public Safety Personnel Retirement System (PSPRS), Corrections Officers Retirement Plan (CORP) and Elected Officials Retirement Plan (EORP).

 

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History

Current law requires ASRS to administer group health and accident insurance coverage for eligible retired and disabled members and their dependents within all four state retirement systems.  Additionally, the law requires ASRS to pay a portion of a retired member’s health care premium (subsidy).  The subsidy amount differs between the four plans, and whether or not members, survivors or dependents are eligible for Medicare.  The portion of a member’s health care premium not covered by ASRS is paid from the member’s retirement benefit or out of the member’s pocket.   Currently, Maricopa, Pima and Pinal county members may elect coverage under an HMO plan.   However, the other 12 Arizona county members are forced to purchase either PPO or indemnity plans.  The differences in monthly premiums between the types of coverage can be seen in the following charts:

 

 

Non-Medicare

 

Member

Classification
HMO

Maricopa, Pima and  Pinal Counties
PPO

All Arizona Counties except Maricopa, Pima and Pinal
INDEMNITY

 

All Arizona Counties

 

Retiree only

 

$313.62

 

$615.56

 

$677.12

Retiree and

1 or more dependents

 

$627.24

 

$1,231.12

 

$1,354.23

 

 

 

 

 

Medicare Plans

 

Member

Classification
HMO

Maricopa, Pima and  Pinal Counties

Medicare Supplement

Nationwide

 

Retiree only

 

$68.74

 

$238.61

Retiree and

1 dependent

 

$137.48

 

$477.22

Retiree and 2 or more dependents

$206.22

$715.83
 

 

Non-Medicare & Medicare Combinations

 

Member Classification

HMO &

Medicare HMO

Maricopa, Pima and Pinal

HMO &

Medicare Supplement

Maricopa, Pima and Pinal

PPO &

Medicare Supplement

All Arizona counties except Maricopa, Pima and Pinal

Indemnity &

Medicare Supplement

Nationwide

Retiree and 1 dependent

(one Medicare and one not)

$382.36

$552.23

$854.17

$915.73

Retiree and 2 or more dependents

(two Medicare & one or more not)

$451.10

$790.84

$1092.78

$1,154.34

 

 
Provisions

·                      Increases the current single health and accident insurance premium payment (subsidy), in nonservice areas until June 30, 2004, for all four state retirement systems up to the following amounts:

1.      $ 300.00 for a member or survivor not eligible for Medicare and who has 10 or more years of credited service with ASRS or 8 or more years of credited service with EORP.  PSPRS and CORP do not have years of credited service eligibility requirements.

2.      $ 170.00 for a member or survivor eligible for Medicare and who has 10 or more years of credited service with ASRS or 8 or more years of credited service with EORP.  PSPRS and CORP do not have years of credited service eligibility requirements.

 

·                      Increases the current family health and accident insurance premium payment (subsidy), in nonservice areas until June 30, 2004, for all four state retirement systems up to the following amounts:

1.      $ 600.00 for a member or survivor and 1 or more dependents not eligible for Medicare.

2.      $ 350.00 for a member or survivor and 1 or more dependents that are eligible for Medicare.

3.      $ 300.00 for a member or survivor, when a member or survivor is not eligible for Medicare and one or more dependents are eligible or for a member or survivor, when a member or survivor is eligible for Medicare and one or more dependents is not eligible.

 

·                      Applies years of credited service eligibility requirements for family health and accident insurance premium payments to ASRS (10 or more years) and EORP (8 or more years) members.  PSPRS and CORP do not have years of credited service eligibility requirements.

 

·                      Defines nonservice area as an employer who does not provide an HMO plan to its members.

 

·                      Stipulates that a member or survivor who resides in a nonservice area and is enrolled in a managed care program is not eligible for the health and accident insurance premium payment, if the member terminates coverage under the managed care program.

 

·                      Allows members or survivors, through June 30, 2004, to purchase individual health care coverage and remain eligible to receive the health and accident premium payment, if the employer assumes administrative functions associated with payment and verifies payment is used for health insurance coverage.

 

·                      Conforms survivor coverage within PSPRS, CORP and EORP only.  Survivor health and accident insurance premium coverage is not provided within ASRS.

 

·                      Applies retroactively July 1, 2001.

 

·                      Makes technical and conforming changes.

 

SB 1107 was amended in the Financial Institutions & Insurance Committee as Follows:

 

·                      Corrected the subsidy amount for the combination non-Medicare/Medicare family health and accident premium payment from $300.00 to $470.00.

 

·                      Reduces the amount of time the temporary nonservice area health and accident premium payment increases will be given through June 30, 2003, rather than June 30, 2004.

 

SB 1107 passed the Appropriations Committee unamended.

 

 

 

 

 

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45th Legislature                                                                                                                                   

First Regular Session                                       3                                                             April 18, 2001

 

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