Report Title:

Hawaii Employer-Union Health Benefits Trust Fund

Description:

Allows the Hawaii Employer-Union Health Benefits Trust Fund to port to employee-organization health benefit plans; provided that the plans accept retirees, are subject to audits, use funds only for health plans, and return excess ported amounts.

HOUSE OF REPRESENTATIVES

H.B. NO.

726

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to the hawaii employer-union health benefits trust fund.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Chapter 87A, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

"§87A- Determination of health benefits plans. Pursuant to sections 87A-32 through 87A-36, the board of trustees shall provide health benefits to employee-beneficiaries in the following manner:

(1) For those employee-beneficiaries who are not participating in a health benefits plan of an emp1oyee organization (hereafter "nonparticipating emp1oyee-beneficiaries"), the board of trustees shall establish health benefits plans and the requirements for eligibi1ity under the health benefits p1ans; and

(2) For employee-beneficiaries who participate in the health benefits plan of an employee organization, the board of trustees shall pay to the employee organization a monthly contribution for the purchase of health benefits for each employee-beneficiary, in the amount provided in sections 87A-32 through 87A-36, or the actual monthly cost of the coverage, whichever is less, toward the purchase of health benefits under the health benefits plan of an employee organization. The board of trustees shall determine which of the fund's plans is the most cost effective plan. The employer contribution shall provide for the same level of benefits, adjusted for demographics including but not limited to age and family size, between the employee-beneficiaries in the plans of the fund. In no case shall the employer contribution exceed the negotiated rate or negotiated amount as a percentage of the fund's most cost effective plan times:

(A) The actual cost of the employee organization plan selected by the employee beneficiary; or

(B) The cost of the fund's most cost effective plan, whichever is less.

As used in this paragraph, "actual cost of the plan" means premiums charged by the insurance carrier less any refunds or dividends paid to the employee organization, or the actual claim cost plus administrative fees charged to the employee organization.

§87A- Excess ported amounts. (a) Any excess ported amount shall be returned by the employee organizations to the fund.

(b) Each participating employee organization shall submit a report by March 31 of each year to the board of trustees identifying any and all excess ported amounts, and the respective sources, to be returned to the fund pursuant to this section.

(c) The excess ported amount identified pursuant to subsection (a) and received by the employee organization for each benefit plan year shall be returned to the fund by June 30 of the following year.

(d) The State and the several counties, as necessary, may examine and audit the enrollment and financial transactions of employee organization benefit plans to verify each participating employee organization’s compliance with this chapter. Each employee organization shall cooperate with any state or county request for financial information relating to health benefits plans in which public employees or their beneficiaries are enrolled.

(e) In lieu of having an employee organization return an excess ported amount, the fund may use a portion or all of the excess ported amount to offset any amount to be paid or transferred to the employee organization. If the fund offsets only a portion of the total excess ported amount, the employee organization shall return the remaining amount to the fund in accordance with this section. In addition to any other rights and remedies provided by law or agreement, the fund may also offset any excess ported amount an employee organization fails to return in accordance with this section from any amount to be paid or transferred to the employee organization.

(f) An employee organization shall hold any excess ported amount in trust for the fund until the excess ported amount is returned to the fund or used to offset fund cost obligations in accordance with subsection (e).

(g)  Notwithstanding any law to the contrary, any rate credit or reimbursement from any carrier or self-insured plan, including any rate credit or reimbursement returned by an employee organization to the fund pursuant to subsection (a), in excess of funds used to stabilize health benefits plan or long- term care benefits plan costs, and for other expenses authorized by law or any earning or interest derived therefrom, shall be returned to the State or the county for deposit into the appropriate general fund if the moneys are returned from:

(1) A plan that provides health benefits to retirees, the surviving spouses of deceased retirees, or employees killed in the performance of their duty, whose coverage is financed in whole or in part by the State or by the county; or

(2) A plan that provides health benefits to employees; provided that the amount returned to the general fund shall be only that portion financed by the State or by the county on behalf of the employee.

(h) To the extent that contributions are provided for group life insurance benefits in sections 87A-17 and 87A-37, the fund shall also be used for purposes of providing group life insurance benefits to employees.

(i) To the extent that contributions are received from employee–beneficiaries and qualified beneficiaries for long-term care insurance benefits under section 87A-41, the fund shall also be used for the purpose of providing long-term care insurance benefits to eligible participants.

(j) As used in this section, "excess ported amount" means any amount financed by the fund to purchase employee benefits through an employee organization that is not actually used for the purchase of such benefits, including but not limited to the employer's share of:

(1) Any rate credits received or any ported amounts held in reserve by the employee organization, including any dividend or interest earned therefrom;

(2) Any reimbursement received by the employee organization from any carrier or self-insured plan, including any dividend or interest earned therefrom; and

(3) Any other similar amounts deemed applicable by the board."

SECTION 2. Employee organizations who participated in the Hawaii public employees health fund's health and group life insurance programs and received contributions from the fund from July 1, 1984, to June 30, 2003, shall:

(1) Return any excess ported amount to the Hawaii employer-union health benefits trust fund as required under section 1 of this Act; and

(2) Submit a report to the board of trustees of the Hawaii employer-union health benefits trust fund identifying the amount and source of funds to be returned for each benefit plan year, which shall include for each benefit plan year by benefit type the employer's contributions, annual carrier experience reports, the employee organization annual audit report, and any annual reports filed with the U.S. Department of Labor, as applicable.

SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ of so much thereof as may be necessary for fiscal year 2003-2004 to audit employee organization plans.

The sum appropriated shall be expended by the department of budget and finance for the purpose of this Act.

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2003.

INTRODUCED BY:

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