85R19083 LED-F     By: Flynn H.B. No. 4035       A BILL TO BE ENTITLED   AN ACT   relating to eligibility and contributions for coverage under the   state employee group benefits program and health benefit plans   offered by certain university systems.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter A, Chapter 824, Government Code, is   amended by adding Section 824.0071 to read as follows:          Sec. 824.0071.  DEDUCTIONS FROM SERVICE OR DISABILITY   RETIREMENT ANNUITY FOR CERTAIN UNIVERSITY INSURANCE PROGRAM   CONTRIBUTIONS. (a) In this section, "program administrator" means   the person who administers the uniform program under Section   1601.051, Insurance Code.          (b)  A retiree who is participating in the uniform program   under Chapter 1601, Insurance Code, may authorize the retirement   system to deduct the amount of the contribution and any other   qualified health insurance premium from the retiree's regular   monthly service or disability retirement annuity payment if the   amount of the monthly annuity is greater than or equal to the amount   of the authorized deduction.          (c)  A retiree may authorize the deduction described by   Subsection (b) on a form provided by the program administrator. The   program administrator shall maintain the record of the   authorization made under this section.          (d)  The program administrator shall:                (1)  notify the retirement system of the authorization   under Subsection (b); and                (2)  in the manner and form prescribed by the   retirement system, provide the retirement system with the names of   the retirees and other relevant information needed by the   retirement system to administer the deduction.          (e)  After making the deduction, the retirement system shall   pay to the program administrator an aggregate amount for all   retirees who authorize annuity deductions under Subsection (b).          (f)  If a retiree no longer receives a monthly annuity   greater than or equal to the amount of the authorized deduction, the   retirement system:                (1)  shall inform the program administrator; and                (2)  is not required to make a deduction under this   section for the retiree.          (g)  The retirement system shall make the authorized   deduction each month until:                (1)  the date the annuity is no longer payable by the   retirement system;                (2)  the retirement system is notified by the program   administrator that the retiree has canceled the authorization to   make the deduction; or                (3)  the amount of the monthly annuity is no longer   greater than or equal to the amount of the authorized deduction as   described by Subsection (f).          (h)  The program administrator shall reimburse the   retirement system the cost, as determined by the retirement system,   incurred by the retirement system in implementing this section.          (i)  This section does not apply to an individual described   by Section 824.007(b).          SECTION 2.  Section 1551.102, Insurance Code, is amended by   adding Subsection (c-1) to read as follows:          (c-1)  An individual is eligible to participate in the group   benefits program as provided by Subsection (a) if:                (1)  the individual meets the minimum requirements   under Subsection (c) except that the individual does not have at   least 10 years of eligible service credit as described by   Subsection (c)(1);                (2)  the individual has at least 10 years of combined   service in a position for which the individual was eligible to   participate in the group benefits program or in the uniform program   under Section 1601.101; and                (3)  either:                      (A)  the individual's greatest number of years of   state employment was in a position for which the individual was   eligible to participate in the group benefits program; or                      (B)  if the individual's years of employment in   positions eligible to participate in the group benefits program and   the uniform program are equal, the individual's last state   employment before retirement was in a position for which the   individual was eligible to participate in the group benefits   program.          SECTION 3.  Section 1601.053, Insurance Code, is amended by   adding Subsection (c) to read as follows:          (c)  Notwithstanding any other provision of this chapter, a   system may adjust a plan and coverage standards as necessary to   comply with applicable state and federal law and to provide   consistent eligibility for all plans under the program, including   eligibility for optional coverages.          SECTION 4.  Section 1601.102, Insurance Code, is amended by   adding Subsection (d-1) to read as follows:          (d-1)  An individual is eligible to participate in the   uniform program as provided by Subsection (a) if:                (1)  the individual meets the minimum requirements   under Subsection (b) except that the individual does not have at   least 10 years of service as described by Subsection (b)(1);                (2)  the individual has at least 10 years of combined   service in a position for which the individual was eligible to   participate in the uniform program or in the group benefits program   under Section 1551.101; and                (3)  either:                      (A)  the individual's greatest number of years of   state employment was in a position for which the individual was   eligible to participate in the uniform program; or                      (B)  if the individual's years of employment in   positions eligible to participate in the uniform program and the   group benefits program are equal, the individual's last state   employment before retirement was in a position for which the   individual was eligible to participate in the uniform program.          SECTION 5.  Subsection (f), Section 1601.102, Insurance   Code, as added by Chapter 1266, Acts of the 78th Legislature,   Regular Session, 2003, is redesignated as Subsection (h), Section   1601.102, Insurance Code, to read as follows:          (h) [(f)]  Notwithstanding Subsection (b), an individual to   whom this subsection applies is eligible to participate in the   uniform program as provided by Subsection (a) if:                (1)  the individual has at least three years of service   with a system for which the individual was eligible to participate   in the uniform program under Section 1601.101;                (2)  the individual's last state employment before   retirement was with that system; and                (3)  the individual retires under the jurisdiction of:                      (A)  the Teacher Retirement System of Texas under   Subtitle C, Title 8, Government Code;                      (B)  the Employees Retirement System of Texas; or                      (C)  subject to Subsection (c):                            (i)  the optional retirement program   established by Chapter 830, Government Code; or                            (ii)  any other federal or state statutory   retirement program to which the system has made employer   contributions.          SECTION 6.  Subsection (g), Section 1601.102, Insurance   Code, as added by Chapter 1266, Acts of the 78th Legislature,   Regular Session, 2003, is redesignated as Subsection (i), Section   1601.102, Insurance Code, and amended to read as follows:          (i) [(g)]  Subsection (h) [(f)] applies only to a person who,   on August 31, 2003:                (1)  was eligible to participate in the uniform program   as an employee under Section 1601.101; or                (2)  was eligible to participate in the uniform program   as a retired employee under this section as this section existed on   January 1, 2003.          SECTION 7.  Subchapter C, Chapter 1601, Insurance Code, is   amended by adding Section 1601.1022 to read as follows:          Sec. 1601.1022.  PARTICIPATION ELIGIBILITY: EMPLOYEES WITH   BREAK IN SERVICE AND EXPECTATION OF REEMPLOYMENT. (a) As provided   by rules adopted by the applicable system, the system may consider a   participant eligible to continue participating in the uniform   program under Section 1601.101 during a break in service during   summer months if the system reasonably expects the individual will   be reemployed after the break in service.          (b)  An individual who remains eligible to continue   participating in the uniform program under Subsection (a) shall pay   all contributions required under this chapter for the coverage   selected by the individual during the break in service, except that   an institution of higher education may make contributions for the   individual from funds available for that purpose.          (c)  An institution of higher education shall determine   which individuals are eligible to continue participating in the   uniform program under this section and, at the time of initial   eligibility, shall notify each individual of the individual's   continued eligibility under Subsection (a).          (d)  An individual who continues participation in the   uniform program under this section is not considered an employee of   an institution of higher education during the break in service for   other purposes solely as a result of the individual's continued   participation in the program.          SECTION 8.  Subchapter C, Chapter 1601, Insurance Code, is   amended by adding Section 1601.1065 to read as follows:          Sec. 1601.1065.  OPTIONAL BASIC COVERAGE PLAN FOR GRADUATE   STUDENTS. The system may design and offer a separate optional basic   coverage plan for employees who are graduate students. The system   shall determine the participation eligibility, coverage, payments,   contributions, and costs of a plan offered under this section.          SECTION 9.  Subchapter E, Chapter 1601, Insurance Code, is   amended by adding Sections 1601.2042 and 1601.211 to read as   follows:          Sec. 1601.2042.  COMPENSATION INSUFFICIENT TO COVER   DEDUCTION. If a participant's monthly compensation from which the   participant's contribution is deducted is insufficient to pay the   participant's contribution for coverage, the system may adopt rules   under which the system considers the coverage to have terminated   after the last full month for which the contribution was paid in   full, as determined by the system.          Sec. 1601.211.  LIABILITY FOR BACK CONTRIBUTIONS FOR DROPPED   COVERAGE. (a)  This section applies to a participant in the uniform   program for whom appropriate contributions were not made during the   entire plan year because of nonpayment of premiums.          (b)  As a condition of enrollment in the same coverage for a   subsequent plan year, the participant must make a contribution   equal to the contributions not made for the plan year for which   appropriate contributions were not made during the entire plan   year, unless the nonpayment of premiums was related to a qualified   change in status, as determined by the system. The payment shall be   made in the form and manner determined by the system.          SECTION 10.  The changes in law made by this Act apply only   to group coverages provided under Chapter 1601, Insurance Code,   beginning with the 2017-2018 plan year. A plan year before   2017-2018 is governed by the law as it existed immediately before   September 1, 2017, and that law is continued in effect for that   purpose.          SECTION 11.  (a)  Except as provided by Subsection (b) of   this section, this Act takes effect immediately if it receives a   vote of two-thirds of all the members elected to each house, as   provided by Section 39, Article III, Texas Constitution. If this   Act does not receive the vote necessary for immediate effect, this   Act takes effect September 1, 2017.          (b)  Section 824.0071, Government Code, as added by this Act,   takes effect January 1, 2018.