HOUSE OF REPRESENTATIVES

H.B. NO.

1807

TWENTY-SIXTH LEGISLATURE, 2012

 

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.  The purpose of this Act is to address the Hawaii employer-union health benefits trust fund.  Specifically, this Act amends the contribution provisions for an employee hired by the State or a county after June 30, 2013.

     During active service, the state or county monthly contribution for an employee hired after June 30, 2013, is the greater of the following:

     (1)  Fifty per cent of the monthly cost of a self plan providing no more than the minimum coverage under the prepaid health care act; or

     (2)  The difference between the monthly cost of the self plan and 1.5 per cent of the employee's monthly wages.

     The new employee may enroll in a self, two-party, or family plan or two or more plans that do not provide duplicate benefits.  A public employee hired after June 30, 2013, however, shall pay the difference between the state or county monthly contribution and the monthly cost of all health benefits plans in which the employee is enrolled.  Because the state or county contribution is calculated according to statute, the contribution for the new employee is made nonnegotiable under collective bargaining.

     The intent of this Act is to make the state or county contribution for an active public employee hired after June 30, 2013, similar to the employer's contribution under the prepaid health care act.  This Act also makes an employee hired after June 30, 2013, ineligible for group life insurance benefits.  This Act also provides that the spouse of a retired employee who was first hired after June 30, 2013, shall not be eligible for any state or county contribution for the medicare part B premium.

     SECTION 2.  Chapter 87A, Hawaii Revised Statutes, is amended by adding two new sections to part IV to be appropriately designated and to read as follows:

     "§87A-A  State or county contribution for employee first hired after June 30, 2013, during active service.  (a)  This section shall apply to an employee first hired after June 30, 2013, during the employee's active service.

     (b)  Except as limited under subsection (c), the State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund for each employee subject to this section a monthly contribution equaling the greater of the following:

     (1)  Fifty per cent of the monthly cost of a self health benefits plan providing no more than the minimum coverage under section 393-12; or

     (2)  The difference between the following:

         (A)  The monthly cost of a self health benefits plan providing no more than the minimum coverage under section 393-12; and

         (B)  1.5 per cent of the monthly wages of the employee.

     (c)  The state or county monthly contribution for the employee shall be used to pay the monthly cost of the health benefits plan or plans in which the employee is enrolled; provided that, if the monthly cost of the health benefits plan or plans is less than the state or county monthly contribution for the employee as calculated under subsection (b), the state or county monthly contribution shall be limited to the amount equaling the monthly cost of the health benefits plan or plans.

     (d)  An employee subject to this section may enroll in a self, two-party, or family health benefits plan or two or more health benefits plans that do not provide duplicate benefits; provided that the state or county monthly contribution for the employee shall be calculated or limited in accordance with subsection (b) or subsection (c), no matter the type or number of health benefits plan or plans in which the employee is enrolled.

     (e)  If an employee subject to this section is married to another employee who is subject to this section or in a civil union or reciprocal beneficiary relationship with another employee who is subject to this section, then the state or county monthly contribution for them shall not exceed the sum of the contributions to which each employee is entitled.

     If an employee subject to this section is married to or in a civil union or reciprocal beneficiary relationship with an employee subject to section 87A-32, section 87A-B shall apply to them.

     (f)  The State or county shall not make any monthly contribution for an employee who is not enrolled in a health benefits plan.

     (g)  Section 87A-40 shall apply to the contribution by an employee subject to this section for a health benefits plan in which the employee is enrolled.

     §87A-B  Treatment of employees subject to different state or county contributions during active service.  If a married couple, civil union partners, or reciprocal beneficiaries are comprised of an employee first hired before July 1, 2013, and another employee first hired after June 30, 2013, and neither is retired, the following shall apply:

     (1)  The employee first hired before July 1, 2013, may enroll in a self plan and be entitled to a state or county monthly contribution determined in accordance with section 87A-32.  The employee first hired after June 30, 2013, may enroll separately in a self plan and be entitled to a state or county monthly contribution determined in accordance with section 87A-A;

     (2)  One employee may enroll in a two-party plan under section 87A-32 or 87A-A that provides coverage for the spouse, civil union partner, or reciprocal beneficiary, and the employee enrolled shall be entitled to a state or county monthly contribution determined in accordance with the section 87A-32 or 87A-A, as applicable.  The spouse, civil union partner, or reciprocal beneficiary shall not be entitled to a separate state or county monthly contribution; or

     (3)  One employee may enroll in a family plan under section 87A-32 or 87A-A that provides coverage for the spouse, civil union partner, or reciprocal beneficiary, as well as other family members, and the employee enrolled shall be entitled to a state or county monthly contribution determined in accordance with section 87A-32 or 87A-A, as applicable.  The spouse, civil union partner, or reciprocal beneficiary shall not be entitled to a separate state or county monthly contribution."

     SECTION 3.  Section 87A-17, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§87A-17[]]  Group life insurance benefits or group life insurance program.  The board may provide benefits under a group life insurance benefits program or group life insurance program to employees[.] hired before July 1, 2013.

     The board shall not provide a group life insurance benefits program or group life insurance program to an employee hired after June 30, 2013, during the employee's active service or after the employee's retirement."

     SECTION 4.  Section 87A-23, Hawaii Revised Statutes, is amended to read as follows:

     "§87A-23  Health benefits plan supplemental to medicare.  The board shall establish a health benefits plan, which takes into account benefits available to an employee-beneficiary and spouse under medicare, subject to the following conditions:

     (1)  There shall be no duplication of benefits payable under medicare.  The plan under this section, which shall be secondary to medicare, when combined with medicare and any other plan to which the health benefits plan is subordinate under the National Association of Insurance Commissioners' coordination of benefit rules, shall provide benefits that approximate those provided to a similarly situated beneficiary not eligible for medicare;

     (2)  The State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund a contribution equal to an amount not less than the medicare part B premium, for each of the following who are enrolled in the medicare part B medical insurance plan:

         (A)  [an] An employee-beneficiary who is a retired employee[,];

         (B)  [an] An employee-beneficiary's spouse while the employee-beneficiary is living[,]; and

         (C)  [an] An employee-beneficiary's spouse, after the death of the employee-beneficiary, if the spouse qualifies as an employee-beneficiary[.];

          provided that, notwithstanding subparagraphs (B) and (C), no contribution to the fund by the State or a county shall be paid for the spouse of an employee who first enters service after June 30, 2013.

          For purposes of this section, a "retired employee" means retired members of the employees' retirement system; county pension system; or a police, firefighters, or bandsmen pension system of the State or a county as set forth in chapter 88.  If the amount reimbursed by the fund under this section is less than the actual cost of the medicare part B medical insurance plan due to an increase in the medicare part B medical insurance plan rate, the fund shall reimburse each employee-beneficiary and employee-beneficiary's spouse for the cost increase within thirty days of the rate change.  Each employee-beneficiary and employee-beneficiary's spouse who becomes entitled to reimbursement from the fund for medicare part B premiums after July 1, 2006, shall designate a financial institution account into which the fund shall be authorized to deposit reimbursements.  This method of payment may be waived by the fund if another method is determined to be more appropriate;

     (3)  The benefits available under this plan, when combined with benefits available under medicare or any other coverage or plan to which this plan is subordinate under the National Association of Insurance Commissioners' coordination of benefit rules, shall approximate the benefits that would be provided to a similarly situated employee-beneficiary not eligible for medicare;

     (4)  All employee-beneficiaries or dependent-beneficiaries who are eligible to enroll in the medicare part B medical insurance plan shall enroll in that plan as a condition of receiving contributions and participating in benefits plans under this chapter.  This paragraph shall apply to retired employees, their spouses, and the surviving spouses of deceased retirees and employees killed in the performance of duty; and

     (5)  The board shall determine which of the employee-beneficiaries and dependent-beneficiaries, who are not enrolled in the medicare part B medical insurance plan, may participate in the plans offered by the fund."

     SECTION 5.  Section 87A-32, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§87A-32[]]  State and county contributions; active employees[.] first hired before July 1, 2013.  (a)  This section shall apply to an employee first hired before July 1, 2013.

     (b)  The State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund a monthly contribution equal to the amount established under chapter 89C or specified in the applicable public sector collective bargaining agreements, whichever is appropriate, for each of their respective employee-beneficiaries and employee-beneficiaries with dependent-beneficiaries, which shall be used toward the payment of costs of a health benefits plan; provided that:

     (1)  The monthly contribution shall be a specified dollar amount;

     (2)  The monthly contribution shall not exceed the actual cost of a health benefits plan;

     (3)  If both husband and wife, civil union partners, or reciprocal beneficiaries are employee-beneficiaries, the total contribution by the State or the county shall not exceed the monthly contribution for a family plan; [and]

     (4)  If an employee subject to this section is married to or a civil union partner or reciprocal beneficiary of an employee subject to section 87A-A, section 87A-B shall apply to them; and

    [(4)] (5)  If the State or any of the counties establish cafeteria plans in accordance with Title 26, United States Code section 125, the Internal Revenue Code of 1986, as amended, and part II of chapter 78, the monthly contribution for those employee-beneficiaries who participate in a cafeteria plan shall be made through the cafeteria plan, and the payments made by the State or counties shall include their respective contributions to the fund and their employee-beneficiary's share of the cost of the employee-beneficiary's health benefits plan.

     [(b)] (c)  The State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund a monthly contribution equal to the amount established under chapter 89C or specified in the applicable public sector collective bargaining agreement, whichever is applicable, for each of their respective employees, to be used toward the payment of group life insurance benefits for each employee."

     SECTION 6.  Section 87A-37, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§87A-37[]]  Group life insurance benefits plans for retired employees[;] eligible for group life insurance benefits plan; contributions.  (a)  This section shall apply to a retired employee eligible to receive group life insurance benefits under section 87A-17.

     (b)  The State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund a base monthly contribution as set forth in subsection [(b)] (c) for each retired employee enrolled in the fund's group life insurance benefits plan under section 87A-34, 87A-35, and 87A-36.

     [(b)] (c)  Effective July 1, 2003, there is established a base monthly contribution of $4.16 for each retired employee enrolled in a group life insurance plan; provided that the monthly contribution shall not exceed the actual cost of the group life insurance benefits plan.  The base composite monthly contribution shall be adjusted annually beginning July 1, 2004.  The adjusted base composite monthly contribution for each new plan year shall be calculated by increasing or decreasing the base composite monthly contribution in effect through the end of the previous plan year by the percentage increase or decrease in the medicare part B premium rate for those years.  The percentage shall be calculated by dividing the medicare part B premium rate in effect at the beginning of the new plan year by the rate in effect through the end of the previous plan year.

     As used in this subsection, "medicare part B premium rate" means the rate published in the Federal Register each year on November 1 or on the business day closest to November 1 of each year after the medicare part B premium rate has been established by the Secretary of Health and Human Services and approved by the United States Congress."

     SECTION 7.  Section 89-2, Hawaii Revised Statutes, is amended as follows:

     1.  By amending the definition of "collective bargaining" to read:

     ""Collective bargaining" means the performance of the mutual obligations of the public employer and an exclusive representative to meet at reasonable times, to confer and negotiate in good faith, and to execute a written agreement with respect to wages, hours, amounts of contributions by the State and counties to the Hawaii employer-union health benefits trust fund[,] for employees hired before July 1, 2013, and other terms and conditions of employment, except that by any such obligation neither party shall be compelled to agree to a proposal or be required to make a concession.  For the purposes of this definition, "wages" includes the number of incremental and longevity steps, the number of pay ranges, and the movement between steps within the pay range and between the pay ranges on a pay schedule under a collective bargaining agreement."

     2.  By amending the definition of "employee organization" to read:

     ""Employee organization" means any organization of any kind in which public employees participate and which exists for the primary purpose of dealing with public employers concerning grievances, labor disputes, wages, hours, amounts of contributions by the State and counties to the Hawaii employer-union health benefits trust fund[,] for employees hired before July 1, 2013, and other terms and conditions of employment of public employees."

     SECTION 8.  Section 89-9, Hawaii Revised Statutes, is amended as follows:

     1.  By amending subsection (a) to read:

     "(a)  The employer and the exclusive representative shall meet at reasonable times, including meetings sufficiently in advance of the February 1 impasse date under section 89-11, and shall negotiate in good faith with respect to wages, hours, the amounts of contributions by the State and respective counties to the Hawaii employer-union health benefits trust fund [to the extent allowed in subsection (e),] for employees hired before July 1, 2013, and other terms and conditions of employment [which] that are subject to collective bargaining and [which] that are to be embodied in a written agreement as specified in section 89-10, but [such] the obligation does not compel either party to agree to a proposal or make a concession[; provided that the parties may not negotiate with respect to cost items as defined by section 89-2 for the biennium 1999 to 2001, and the cost items of employees in bargaining units under section 89-6 in effect on June 30, 1999, shall remain in effect until July 1, 2001]."

     2.  By amending subsections (d) and (e) to read:

     "(d)  Excluded from the subjects of negotiations are matters of classification, reclassification, benefits of [but not] the Hawaii employer-union health benefits trust fund, contributions to the Hawaii employer-union health benefits trust fund[,] for employees hired after June 30, 2013, or retired employees, recruitment, examination, initial pricing, and retirement benefits except as provided in section 88-8(h).  The employer and the exclusive representative shall not agree to any proposal [which] that would be inconsistent with the merit principle or the principle of equal pay for equal work pursuant to section 76-1 or [which] that would interfere with the rights and obligations of a public employer to:

     (1)  Direct employees;

     (2)  Determine qualifications, standards for work, and the nature and contents of examinations;

     (3)  Hire, promote, transfer, assign, and retain employees in positions;

     (4)  Suspend, demote, discharge, or take other disciplinary action against employees for proper cause;

     (5)  Relieve an employee from duties because of lack of work or other legitimate reason;

     (6)  Maintain efficiency and productivity, including maximizing the use of advanced technology, in government operations;

     (7)  Determine methods, means, and personnel by which the employer's operations are to be conducted; and

     (8)  Take such actions as may be necessary to carry out the missions of the employer in cases of emergencies.

     This subsection shall not be used to invalidate provisions of collective bargaining agreements in effect on and after June 30, 2007, and shall not preclude negotiations over the procedures and criteria on promotions, transfers, assignments, demotions, layoffs, suspensions, terminations, discharges, or other disciplinary actions as a permissive subject of bargaining during collective bargaining negotiations or negotiations over a memorandum of agreement, memorandum of understanding, or other supplemental agreement.

     Violations of the procedures and criteria so negotiated may be subject to the grievance procedure in the collective bargaining agreement.

     (e)  Negotiations relating to contributions to the Hawaii employer-union health benefits trust fund authorized under this chapter shall be for the purpose of agreeing upon the amounts which the State and counties shall contribute under section 87-4, toward the payment of the costs for a health benefits plan, as defined in section 87-1(8), and group life insurance benefits, and the parties shall not be bound by the amounts contributed under prior agreements; provided that section 89-11 for the resolution of disputes by way of arbitration shall not be available to resolve impasses or disputes relating to the amounts the State and counties shall contribute to the Hawaii employer-union health benefits trust fund."

     SECTION 9.  Section 89-11, Hawaii Revised Statutes, is amended by amending subsection (g) to read as follows:

     "(g)  The decision of the arbitration panel shall be final and binding upon the parties on all provisions submitted to the arbitration panel.  If the parties have reached agreement with respect to the amounts of contributions by the State and counties to the Hawaii employer-union health benefits trust fund for employees hired before July 1, 2013, by the tenth working day after the arbitration panel issues its decision, the final and binding agreement of the parties on all provisions shall consist of the panel's decision and the amounts of contributions agreed to by the parties.  If the parties have not reached agreement with respect to the amounts of contributions by the State and counties to the Hawaii employer-union health benefits trust fund by the close of business on the tenth working day after the arbitration panel issues its decision, the parties shall have five days to submit their respective recommendations for such contributions to the legislature, if it is in session, and if the legislature is not in session, the parties shall submit their respective recommendations for such contributions to the legislature during the next session of the legislature.  In such event, the final and binding agreement of the parties on all provisions shall consist of the panel's decision and the amounts of contributions established by the legislature by enactment, after the legislature has considered the recommendations for such contributions by the parties.  It is strictly understood that no member of a bargaining unit subject to this subsection shall be allowed to participate in a strike on the issue of the amounts of contributions by the State and counties to the Hawaii employer-union health benefits trust fund.  The parties shall take whatever action is necessary to carry out and effectuate the final and binding agreement.  The parties may, at any time and by mutual agreement, amend or modify the panel's decision.

     Agreements reached pursuant to the decision of an arbitration panel and the amounts of contributions by the State and counties to the Hawaii employer-union health benefits trust fund, as provided herein, shall not be subject to ratification by the employees concerned.  All items requiring any moneys for implementation shall be subject to appropriations by the appropriate legislative bodies and the employer shall submit all such items within ten days after the date on which the agreement is entered into as provided herein, to the appropriate legislative bodies."

     SECTION 10.  This Act does not affect health benefit plan contributions for a state or county employee first hired after June 30, 2013, that were established under a collective bargaining contract, the cost items of which were approved before the effective date of this Act.

     This Act shall not apply to such an employee until the initial expiration date of the collective bargaining contract, whether renewed or not.

     SECTION 11.  In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 12.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 13.  This Act shall take effect on July 1, 2013.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

Hawaii Employer-Union Health Benefits Trust Fund; New State and County Employees

 

Description:

Limits state or county monthly contribution for the health benefits plan of an employee who is first hired after 6/30/13.  Provides, during active service of the employee, state or county monthly contributions for the employee that are similar to the employer contribution under the prepaid health care act.  Makes the state or county monthly contribution for such an employee nonnegotiable under collective bargaining.  Prohibits the board from providing a group life insurance benefits program or group life insurance program to an employee hired after 6/30/13.  Provides that the spouse of a retired employee who is first hired after 6/30/13 shall not be eligible for medicare part B premium reimbursements. 

 

 

 

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