Legislative Report

Report 09-11
April 9, 2009

HOUSE COMMITTEE REVAMPS HEALTH PLAN BILL

The House Appropriations Committee debated Senate Bill 287 (State Health Plan changes) on Wednesday and approved an amended version of the bill on a very close vote (49 voting Yes, 44 voting No). The bill will go to the House floor next week. The significant changes to the bill are summarized below.

• The Wellness Initiatives that would have moved members who smoke or who are obese to the PPO Basic Plan have been removed from the latest version of SB 287.
• The monthly premium for dependent and spouse coverage in the State Health Plan will increase by 10% effective July 1, 2009 and by another 10% on July 1, 2010 to cover the projected one-time costs of moving to a calendar year for the Plan.
• A Blue Ribbon Task Force will be appointed to review the governance of the Plan and to make recommendations to the General Assembly. This Committee will consist of 15 members, with 6 appointed by the Senate, 6 by the House, the chairman of the State Health Plan Board of Directors, the Commissioner of Insurance, and one member appointed by the Governor.

Our primary concerns regarding the proposed increases in the annual deductible and in the annual out-of-pocket maximum paid by Plan members were not addressed in the House Appropriations Committee. We ask that you contact your House members if you have not already done so. Urge them to make every effort to reduce the proposed increases in member annual deductible and out-of-pocket maximum when Senate bill 287 goes to the House floor.

OTHER BILLS OF INTEREST

House Bill 934: Local Employees’ Retirement System COLAs
(Primary Sponsors – Rep. Tucker and Rep. McLawhorn)

This bill authorizes the payment of a 1.0% COLA for retired local governmental employees effective July 1, 2009 from undistributed gains in the Local Governmental Employees’ Retirement System.

HB 934 has been referred to the House Committee on Pensions and Retirement

House Bill 1247: State Health Plan/Employee-Only Premium
(Primary Sponsor – Rep. Haire)

This bill would require all employees covered by the State Health Plan who are hired on or after October 1, 2009 to pay a premium for Health Plan coverage. The amount of the monthly premium paid by an employee would be linked to annual salary level. Employees earning less than $50,000 would pay $10 per month. Employees with annual salaries between $50,000 and $100,000 would pay $15 per month, and employees earning more than $100,00 would pay $20.

Please note that HB 1247 in original form contains language that appears to apply these premiums to any retiree who is re-employed on or after October 1, 2009 by an agency participating in the State Health Plan. However, a clarification provided by legislative staff indicates this was a drafting error and will be corrected in the next edition of the bill. Premiums would not apply to anyone currently vested in the State Health Plan.

HB 1247 has been referred to the House Insurance Committee.

The Senate approved the SB 202, the Appropriations Act 0f 2009, on third reading this morning. The Senate’s budget differs significantly from the proposal presented by Governor Perdue. The bill now goes to the House. We will analyze Senate Bill 2002 in next week’s Legislative Report.