SENATE, No. 3086

STATE OF NEW JERSEY

215th LEGISLATURE

 

INTRODUCED DECEMBER 5, 2013

 


 

Sponsored by:

Senator  PAUL A. SARLO

District 36 (Bergen and Passaic)

Senator  STEVEN V. OROHO

District 24 (Morris, Sussex and Warren)

 

Co-Sponsored by:

Senator Pou

 

 

 

 

SYNOPSIS

     Concerns disclosure and reimbursement procedures of board of education and municipal employee health care benefit contracts.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning board of education and municipal employee health care benefit contracts and amending P.L.1979, c.391 and N.J.S.40A:10-21.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.  Section 6 of P.L.1979, c.391 (C.18A:16-17) is amended to read as follows:

     6.  a.  Any local board of education entering into a contract pursuant to [this act] P.L.1979, c.391 (C.18A:16-12 et seq.) is authorized to pay part or all of the premiums or charges for such contracts and may appropriate out of its general funds any money necessary to pay such premiums or charges or portions thereof.

     The contribution required of any employee toward the cost of such coverage may be deducted from the pay, salary or other compensation of such employee upon authorization in writing made to the local board of education.

     The local board of education may reimburse an active employee for his premium charges under Part B of the Federal Medicare Program covering the employee alone.

     Nothing herein shall be construed as compelling a local board of education to pay any portion of the premiums or charges attributable to such contracts.

     b.  Commencing on the effective date of P.L.2010, c.2 and upon the expiration of any applicable binding collective negotiations agreement in force on that effective date, employees of a local board of education shall pay 1.5 percent of base salary, through the withholding of the contribution from the pay, salary or other compensation, for health care benefits coverage provided pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.), notwithstanding any other amount that may be required additionally pursuant to subsection a. of this section for such coverage.  This subsection shall apply also when the health care benefits coverage is provided through an insurance fund or joint insurance fund or in any other manner.

     c.  A local board of education shall publicly disclose in writing on its official Internet website, if one exists, or, if one does not exist, the Department of Education shall publicly disclose in writing on its official Internet website, within 30 days following the close of each fiscal year:

     (1)  The total cost of premiums paid for that fiscal year for any contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.); and

     (2)  The total amount for that fiscal year of any reimbursement, rebate, or other return of any part of the cost of premiums paid for any contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.).

     d.  A local board of education shall publicly disclose in writing on its official Internet website if one exists, or, if one does not exist, the Department of Education shall publicly disclose in writing on its official Internet website:

     (1)  The total cost of premiums paid for any new or altered contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.) within 30 days of the local board’s execution of the new or altered contractual provisions; and

     (2)  The total amount of any reimbursement, rebate, or other return of any part of the cost of premiums paid for any contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.) within 30 days of the local board’s receipt of the reimbursement, rebate, or other return.

     In the event of a reimbursement, rebate, or other return of any part of the cost of a premium to a local board of education, each employee shall receive a credit that is proportional to the amount of their cost share or premium share contribution.  The credit shall be applied against the employee’s cost share or premium share contribution requirement in the following year.  In the event of an employee’s retirement or other termination of employment, the amount of any credit due shall be paid to the employee, or to his or her heirs in the case of termination by death, within 30 days of a local board of education’s disclosure of the receipt of a reimbursement, rebate, or other return of any part of the cost of premiums paid, or within 30 days of employment termination, whichever is later.

     At the time of a disclosure required by this subsection, the local board of education shall provide each employee, via regular or electronic mail, or both, with the information disclosed.  The information disclosed shall also be open to public inspection in accordance with P.L.1963, c.73 (C. 47:1A-1 et seq.).

(cf: P.L.2010, c.2, s.13)

 

     2.  N.J.S.40A:10-21 is amended to read as follows:

     40A:10-21.  a.  Any employer entering into a contract pursuant to this subarticle, sections 16 through 25 of P.L.1979, c.230 (C.40A:10-1 et seq.), is hereby  authorized to pay part or all of the premiums or charges for the contracts and  may appropriate out of its general funds any money necessary to pay premiums or charges or portions thereof.  The contribution required of any employee toward the cost of coverage may be deducted from the pay, salary or other compensation of the employee upon an authorization in writing made to the appropriate disbursing officer.

     The employer may reimburse an active employee for his premium charges under Part B of the Federal Medicare Program covering the employee alone.

     Nothing herein shall be construed as compelling an employer to pay any portion of the premiums or charges attributable to the contracts.

     b.  Commencing on the effective date of P.L.2010, c.2 and upon the expiration of any applicable binding collective negotiations agreement in force on that effective date, employees of an employer shall pay 1.5 percent of base salary, through the withholding of the contribution from the pay, salary or other compensation, for health care benefits coverage provided pursuant to N.J.S.40A:10-17, notwithstanding any other amount that may be required additionally pursuant to subsection a. of this section for such coverage.  This subsection shall apply also when the health care benefits coverage is provided through an insurance fund or joint insurance fund or in any other manner.  This subsection shall apply to any agency, board, commission, authority, or instrumentality of a local unit.

     c.  As used in subsections d. and e. of this section:

     “municipality” means any city, borough, village, town, township, or any other municipality or agency thereof, but not a county, fire district, volunteer first aid squad, or other volunteer squad;

     “employee” means any employee of a municipality.

     d.  A municipality shall publicly disclose in writing on its official Internet website, if one exists, or, if one does not exist, the Department of Community Affairs shall publicly disclose in writing on its official Internet website, within 30 days following the close of each fiscal year:

     (1)  The total cost of premiums paid for that fiscal year for any contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to sections 16 through 25 of P.L.1979, c.230 (C.40A:10-1 et seq.); and

     (2)  The total amount for that fiscal year of any reimbursement, rebate, or other return of any part of the cost of premiums paid for any contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to sections 16 through 25 of P.L.1979, c.230 (C.40A:10-1 et seq.).

     e.  A municipality shall publicly disclose in writing on its official Internet website if one exists, or, if one does not exist, the Department of Community Affairs shall publicly disclose in writing on its official Internet website:

     (1)  The total cost of premiums paid for any new or altered contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to sections 16 through 25 of P.L.1979, c.230 (C.40A:10-1 et seq.) within 30 days of the municipality’s execution of the new or altered contractual provisions; and

     (2)  The total amount of any reimbursement, rebate, or other return of any part of the cost of premiums paid for any contract to provide health care benefits including prescription drug benefits and other health care benefits provided pursuant to sections 16 through 25 of P.L.1979, c.230 (C.40A:10-1 et seq.) within 30 days of the municipality’s receipt of the reimbursement, rebate, or other return.

     In the event of a reimbursement, rebate, or other return of any part of the cost of a premium to a municipality, each employee shall receive a credit that is proportional to the amount of their cost share or premium share contribution.  The credit shall be applied against the employee’s cost share or premium share contribution requirement in the following year.  In the event of an employee’s retirement or other termination of employment, the amount of any credit due shall be paid to the employee, or to his or her heirs in the case of termination by death, within 30 days of a municipality’s disclosure of the receipt of a reimbursement, rebate, or other return of any part of the cost of premiums paid, or within 30 days of employment termination, whichever is later.

     At the time of a disclosure required by this subsection, the municipality shall provide each employee, via regular or electronic mail, or both, with the information disclosed.  The information disclosed shall also be open to public inspection in accordance with P.L.1963, c.73 (C. 47:1A-1 et seq.).

(cf: P.L.2010, c.2, s.14)

 

     3.  The Commissioner of Education shall, in consultation with Division of Pensions and Benefits in the Department of the Treasury, and in accordance with the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), promulgate any rules and regulations necessary to accomplish the purposes of section 1 of P.L.    , c.    (C.        ) (pending before the Legislature as this bill).  The Commissioner of Community Affairs shall, in consultation with Division of Pensions and Benefits in the Department of the Treasury, and in accordance with the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), promulgate any rules and regulations necessary to accomplish the purposes of section 2 of P.L.    , c.    (C.        ) (pending before the Legislature as this bill).

 

     4.  This act shall take effect on the first day of the fourth month next following enactment, except that section 3 shall take effect immediately.


STATEMENT

 

     This bill would modify information disclosure and reimbursement procedures for local board of education and municipal employee health care benefit contracts.

     Under the bill, any local board of education or municipal employer would be required during each fiscal year to make certain public disclosures.  These would include the total cost of premiums paid, and the total amount of any reimbursements, rebates, or other return of the cost of premiums paid in that fiscal year for prescription drug or other health care benefit contracts provided pursuant to P.L.1979, c.391 and P.L.1979, c.230, respectively.

     Under the bill, local boards of education and municipal employers would also be required to make public disclosures within 30 days of execution of any new or altered contract for prescription drug or other health care benefits, and within 30 days of receipt of any reimbursement, rebate, or other return of a part of the premiums paid.

     In the event of a reimbursement, rebate, or other return of any part of the premiums to a local board of education or municipal employer, each employee would receive a credit proportional to the amount of their cost contribution.  The credit would be applied against the employee’s cost contribution requirement in the following year.  In the event of an employee’s retirement or other termination of employment, the employee, or his or her heirs in the case of termination by death, would receive a corresponding payment within 30 days of the board’s disclosure of the premium cost return, or within 30 days of employment termination, whichever is later.

     Upon each disclosure, the associated information will be provided to each employee, via regular or electronic mail, or both. The disclosed information will also be open to public inspection in accordance with P.L.1963, c.73, commonly known as the open public records act.