S103

An Act concerning eligibility of certain public employees for health care benefits provided by public employers, amending various parts of the statutory law, and supplementing P.L.1961, c.49 (C.52:14-17.25 et seq.), P.L.1983, c.313 (C.40A:5A-1 et seq.), andchapter 16 of Title 18A of the New Jersey Statutes.

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

1. Section 3 of P.L.1979, c.391 (C.18A:16-14) is amended to read as follows:

3. The contract shall exclude from eligibility:

a. Employees and dependents, active or retired, who are otherwise eligible for coverage but who, although they meet the age eligibility requirement of the Federal Medicare Program, are not covered by the complete Federal program;

b. Any class or classes of employees who are eligible for like or similar coverage under another group contract covering such class or classes of employees.

Commencing 90 days after the effective date of section 1 of section 1 of P.L. , c. (pending before the Legislature as this bill): if an employee eligible for health care benefits coverage while holding a position, office, or employment with a local board of education also is eligible for health care benefits coverage under a health care benefits plan or program because of service in any other public position, office, or employment of this State, the employee shall select coverage under only one such plan or program; and if an employee eligible for health care benefits coverage while holding a position, office, or employment with a local board of education also is eligible for health care benefits coverage under a health care benefits plan or program because of service by the employee’s spouse in any public position, office, or employment of this State, the employee shall select coverage with the employer or shall select coverage with the plan or program of the spouse’s employer, but not both, and may be eligible for a payment for a waiver of the coverage if the employer is outside of the School Employees’ Health Benefits Program in accordance with section 8 of P.L. , c. (C. )(pending before the Legislature as this bill). This paragraph 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 paragraph shall apply to any agency, board, commission, authority, or instrumentality of a local board of education. Commencing 90 days after the effective date of section 1 of P.L. , c. (pending before the Legislature as this bill), an employee described in this paragraph with more than one position, office, or employment shall not be eligible for a continuation of any payment in consideration of filing a waiver of coverage granted prior thereto or for any waiver of coverage and payment thereafter.

(cf: P.L.1979, c.391, s.3)

2. N.J.S.40A:10-18 is amended to read as follows:

40A:10-18. Exclusions from coverage

The contract shall exclude from eligibility:

b. Any class or classes of employees who are eligible for like or similar coverage under another group contract covering the class or classes of employees.

Commencing 90 days after the effective date of section 2 of P.L. , c. (pending before the Legislature as this bill): if an employee eligible for health care benefits coverage while holding a position, office, or employment with a local unit or agency thereof also is eligible for health care benefits coverage under a health care benefits plan or program because of service in any other public position, office, or employment of this State, the employee shall select coverage under only one such plan or program; and if an employee eligible for health care benefits coverage while holding a position, office, or employment with a local unit or agency thereof also is eligible for health care benefits coverage under a health care benefits plan or program because of service by the employee’s spouse in any public position, office, or employment of this State, the employee shall select coverage with the employer or shall select coverage with the plan or program of the spouse’s employer, but not both, and may be eligible for a payment for a waiver of the coverage if the employer is outside of the State Health Benefits Program in accordance with 37 of P.L.1995, c.259 (C.40A:10-17.1). This paragraph 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 paragraph shall apply to any agency, board, commission, or instrumentality of a local unit. Commencing 90 days after the effective date of section 2 of P.L. , c. (pending before the Legislature as this bill), an employee described in this paragraph with more than one position, office, or employment shall not be eligible for a continuation of any payment in consideration of filing a waiver of coverage pursuant to section 37 of P.L.1995, c.259 (C.40A:10-17.1) granted prior thereto or for any waiver of coverage and payment thereafter.

(cf: N.J.S.40A:10-18)

3. Section 37 of P.L.1995, c.259 (C.40A:10-17.1) is amended to read as follows:

37. Notwithstanding the provisions of any other law to the contrary, a county, municipality or any contracting unit as defined in section 2 of P.L.1971, c.198 (C.40A:11-2) which enters into a contract providing group health care benefits to its employees pursuant to N.J.S.40A:10-16 et seq., may allow any employee who is eligible for other health care coverage, including an employee described in N.J.S.40A:10-18 who is required to select coverage with the employer or the spouse’s employer, to waive coverage under the county's, municipality's or contracting unit's plan to which the employee is entitled by virtue of employment with the county, municipality or contracting unit. The waiver shall be in such form as the county, municipality or contracting unit shall prescribe and shall be filed with the county, municipality or contracting unit. A county, municipality or any contracting unit shall reauthorize each year the allowance to waive coverage. In consideration of filing such a waiver, a county, municipality or contracting unit may pay to the employee, but not to an elected official whose term of office commenced after the effective date of section 3 of P.L. , c. (pending before the Legislature as this bill), annually an amount, to be established in the sole discretion of the county, municipality or contracting unit, which shall not exceed 50% of the amount saved by the county, municipality or contracting unit because of the employee's waiver of coverage, and, for a waiver filed on or after the effective date of P.L.2010, c.2, which shall not exceed 25%, or $5,000, whichever is less, of the amount saved by the county, municipality or contracting unit because of the employee's waiver of coverage. An employee who waives coverage shall be permitted to resume coverage under the same terms and conditions as apply to initial coverage if the employee ceases to be covered through the employee's spouse for any reason, including, but not limited to, the retirement or death of the spouse or divorce. An employee who resumes coverage shall repay, on a pro rata basis, any amount received which represents an advance payment for a period of time during which coverage is resumed. An employee who wishes to resume coverage shall file a declaration with the county, municipality or contracting unit, in such form as the county, municipality or contracting unit shall prescribe, that the waiver is revoked. The decision of a county, municipality or contracting unit to allow its employees to waive coverage and the amount of consideration to be paid therefor shall not be subject to the collective bargaining process.

(cf: P.L.2010, c.2, s.18)

4. Section 7 of P.L.1961, c.49 (C.52:14-17.31) is amended to read as follows:

7. a. The coverage provided solely for employees shall, subject to the provisions below, automatically become effective for all eligible employees from the first day on or after the effective date of the program on which they satisfy the definition of "employee" contained in this act. The commission shall establish the rules and regulations governing the enrollment and effective dates of coverage of dependents of employees it deems necessary or desirable. The rules and regulations shall not defer coverage with respect to any qualified dependent an employee has on the date the employee's employer becomes a participating employer, provided the employee was, immediately prior to the date, insured with respect to the dependent under a group insurance plan of the employer which was in effect immediately prior to the date. Under the rules and regulations established by the commission, each employee shall be given the opportunity to enroll for coverage for dependents as of the earliest date the employee becomes eligible for enrollment. With respect to the traditional plan, an employee may elect to enroll dependents for both basic coverage and major medical expense coverage but may not enroll for either coverage alone.

b. In the event that the group health plan which covered an employee or dependents immediately prior to the date the employee's employer becomes a participating employer provides, after termination of coverage thereunder, any continuation of benefits, or would so provide in the absence of coverage pursuant to this act, no coverage shall be afforded pursuant to this act for any such expenses (i) which are covered, or which would be covered in the absence of coverage pursuant to this act, in whole or in part, by the prior insurance plan or (ii) which may be used in satisfaction of any deductible requirement under the prior insurance plan to establish entitlement to the continuation of benefits.

c. Each employee shall furnish the Division of Pensions and Benefits, in the prescribed form, the information necessary on account of the employee's own coverage and necessary to enroll dependents. Any employee not desiring coverage at the time the employee first becomes eligible, shall give the division written notice of that fact in the form prescribed by the division. The employee may not enroll thereafter except at the times and under the conditions prescribed by the commission.

d. Any person employed as a substitute teacher by a school district and who provides evidence of coverage under another health benefits program may waive coverage for the current school year on or after the date on which the person becomes an employee eligible for coverage.

e. Multiple coverage in the program as an employee, dependent, or retiree shall be prohibited and the prohibition shall be implemented in accordance with the rules and regulations promulgated by the commission. The provisions of this paragraph shall be applicable to the State Health Benefits Program and to the School Employees' Health Benefits Program to the extent not inconsistent with the provisions of sections 31 through 41 of P.L.2007, c.103 (C.52:14-17.46.1 et seq.).

f. Commencing 90 days after the effective date of section 4 of P.L. , c. (pending before the Legislature as this bill): if an employee eligible for health care benefits coverage under the State Health Benefits Program or the School Employees' Health Benefits Program while holding a position, office, or employment with the State or a participating public employer also is eligible for health care benefits coverage under a health care benefits plan or program because of service in any other public position, office, or employment of this State, the employee shall select coverage under only one such plan or program; and if an employee eligible for health care benefits coverage under the State Health Benefits Program or the School Employees' Health Benefits Program while holding a position, office, or employment with the State or a participating public employer also is eligible for health care benefits coverage under a health care benefits plan or program because of service by the employee’s spouse in any public position, office, or employment of this State, the employee shall select coverage with the employer or shall select coverage with the plan or program of the spouse’s employer, but not both. This subsection shall be applicable to the State Health Benefits Program and to the School Employees' Health Benefits Program. Commencing 90 days after the effective date of section 4 of P.L. , c. (pending before the Legislature as this bill), an employee described in this subsection with more than one position, office, or employment shall not be eligible for a continuation of any payment in consideration of filing a waiver of coverage pursuant to section 36 of P.L.1995, c.259 (C.52:14-17.31a) granted prior thereto or for any waiver of coverage and payment thereafter.

(cf: P.L.2010, c.2, s.12)

5. Section 36 of P.L.1995, c.259 (C.52:14-17.31a) is amended to read as follows:

36. a. Notwithstanding the provisions of any other law to the contrary, an employer other than the State which participates in the State Health Benefits Program, established pursuant to P.L.1961, c.49 (C.52:14-17.25 et seq.), may allow any employee who is eligible for other health care coverage to waive coverage under the State Health Benefits Program to which the employee is entitled by virtue of employment with the employer. The waiver shall be in such form as the Director of the Division of Pensions and Benefits shall prescribe and shall be filed with the division. After such waiver has been filed and for so long as that waiver remains in effect, no premium shall be required to be paid by the employer for the employee or the employee's dependents. Not later than the 180th day after the date on which the waiver is filed, the division shall refund to the employer the amount of any premium previously paid by the employer with respect to any period of coverage which followed the filing date. An employer other than the State shall reauthorize each year the allowance to waive coverage.

b. Notwithstanding the provisions of any other law to the contrary, the State as an employer, or an employer that is an independent authority, commission, board, or instrumentality of the State which participates in the State Health Benefits Program, may allow any employee who is eligible for other health care coverage that is not under the State Health Benefits Program to waive the coverage under the State Health Benefits Program to which the employee is entitled by virtue of employment with the employer. The waiver shall be in such form as the Director of the Division of Pensions and Benefits shall prescribe and shall be filed with the division. The State as an employer, or an employer that is an independent authority, commission, board, or instrumentality of the State shall reauthorize each year the allowance to waive coverage.

c. In consideration of filing a waiver as permitted in subsections a. and b. of this section, an employer may pay to the employee, but not to an elected official whose term of office commenced after the effective date of section 5 of P.L. , c. (pending before the Legislature as this bill), annually an amount, to be established in the sole discretion of the employer, which shall not exceed 50% of the amount saved by the employer because of the employee's waiver of coverage, and, for a waiver filed on or after the effective date of P.L.2010, c.2, which shall not exceed 25%, or $5,000, whichever is less, of the amount saved by the employer because of the employee's waiver of coverage. An employee who waives coverage shall be permitted to immediately resume coverage if the employee ceases to be eligible for other health care coverage for any reason, including, but not limited to, the retirement or death of the spouse or divorce. An employee who resumes coverage shall repay, on a pro rata basis, any amount received from the employer which represents an advance payment for a period of time during which coverage is resumed. An employee who wishes to resume coverage shall notify the employer in writing and file a declaration with the division, in such form as the director of the division shall prescribe, that the waiver is revoked. The decision of an employer to allow its employees to waive coverage and the amount of consideration to be paid therefor shall not be subject to the collective bargaining process.

(cf: P.L.2010, c.2, s.1l)

6. (New section) Notwithstanding the provisions of any other law to the contrary, commencing 90 days after the effective date of this section of P.L. , c. (pending before the Legislature as this bill): if an employee eligible for health care benefits coverage while holding a position, office, or employment with an independent State authority also is eligible for health care benefits coverage under a health care benefits plan or program because of service in any other public position, office, or employment of this State, the employee shall select coverage under only one such plan or program; and if an employee eligible for health care benefits coverage while holding a position, office, or employment with an independent State authority also is eligible for health care benefits coverage under a health care benefits plan or program because of service by the employee’s spouse in any public position, office, or employment of this State, the employee shall select coverage with the employer or shall select coverage with the plan or program of the spouse’s employer, but not both, and may be eligible for a payment for a waiver of the coverage if the employer is outside of the State Health Benefits Program or School Employees’ Health Benefits Program. This section 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 section shall apply to a State authority that is not covered by the provisions of subsection f. of section 7 of P.L.1961, c.49 (C.52:14-17.31) or section 36 of P.L.1995, c.259 (C.52:14-17.31a). Commencing 90 days after the effective date of this section of P.L. , c. (pending before the Legislature as this bill), an employee described in this section with more than one position, office, or employment shall not be eligible for a continuation of any payment in consideration of filing a waiver of coverage granted prior thereto or for any waiver of coverage and payment thereafter.

As used in this section, "independent State authority" means a public authority, board, commission, corporation, or other agency or instrumentality of the State allocated, in but not of, a principal department of State government pursuant to Article V, Section IV, paragraph 1 of the New Jersey Constitution, or which is not subject to supervision or control by the department in which it is allocated, and a regional authority, but shall not include a college or university.

7. (New section) Notwithstanding the provisions of any other law to the contrary, commencing 90 days after the effective date of this section of P.L. , c. (pending before the Legislature as this bill): if an employee eligible for health care benefits coverage while holding a position, office, or employment with a local authority also is eligible for health care benefits coverage under a health care benefits plan or program because of service in any other public position, office, or employment of this State, the employee shall select coverage under only one such plan or program; and if an employee eligible for health care benefits coverage while holding a position, office, or employment with a local authority also is eligible for health care benefits coverage under a health care benefits plan or program because of service by the employee’s spouse in any public position, office, or employment of this State, the employee shall select coverage with the employer or shall select coverage with the plan or program of the spouse’s employer, but not both, and may be eligible for a payment for a waiver of the coverage if the employer is outside of the State Health Benefits Program or School Employees’ Health Benefits Program. This section 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 section shall apply to a local authority that is not covered by the provisions of N.J.S.40A:10-18 or section 37 of P.L.1995, c.259 (C.40A:10-17.1). Commencing 90 days after the effective date of this section of P.L. , c. (pending before the Legislature as this bill), an employee described in this section with more than one position, office, or employment shall not be eligible for a continuation of any payment in consideration of filing a waiver of coverage granted prior thereto or for any waiver of coverage and payment thereafter.

As used in this section, "local authority" means an "authority" as defined under the "Local Authorities Fiscal Control Law,"P.L.1983, c.313 (C.40A:5A-1 et seq.).

8. (New section) Notwithstanding the provisions of any other law to the contrary, a board of education which enters into a contract providing group health care benefits to its employees pursuant to P.L.1979, c.391 (C.18A:16-12 et seq.), may allow any employee who is eligible for other health care coverage, including an employee described in section 3 of P.L.1979, c.391 (C.18A:16-14) who is required to select coverage with the employer or coverage with the spouse’s employer, to waive coverage under the board of education’s plan to which the employee is entitled by virtue of employment with the board of education. The waiver shall be in such form as the board of education shall prescribe and shall be filed with the board of education. In consideration of filing such a waiver, a board of education may pay, or shall pay if the waiver is provided for in a collective bargaining agreement, to the employee, but not to an elected official whose term of office commenced after the effective date of this section of P.L. , c. (pending before the Legislature as this bill), annually an amount, subject to the collective bargaining process, because of the employee's waiver of coverage. An employee who waives coverage shall be permitted to resume coverage under the same terms and conditions as apply to initial coverage if the employee ceases to be covered through the employee's spouse for any reason, including, but not limited to, the retirement or death of the spouse or divorce. An employee who resumes coverage shall repay, on a pro rata basis, any amount received which represents an advance payment for a period of time during which coverage is resumed. An employee who wishes to resume coverage shall file a declaration with the board of education in such form as the board of education shall prescribe, that the waiver is revoked.

9. Sections 1, 2, 4, 6, 7 and 8 shall take effect immediately and shall apply to all public employees employed on or after this effective date, but shall not be deemed to impair the obligations in a collective negotiations agreement in effect on that date, and sections 3 and 5 shall take effect on the 90^th day after enactment.

STATEMENT

This bill limits a public employee of the State, a local government, or a local board of education, or agency or authority thereof, to receiving health care benefits coverage from only one public employer of this State if the employee holds more than one public position simultaneously. The bill prohibits a public employee so limited from continuing to receive any payment from the employee’s public employer for waiving the health care benefits coverage provided by the employer and from waiving any coverage and receiving payment in the future.

If the public employee has a spouse who also is a public employee eligible for health care benefits coverage from a public employer of this State, the employee will be required to select coverage with the employer or with the spouse’s employer, but not both. An employee required to select coverage with the employer or the spouse’s employer will continue to be eligible to waive coverage and receive payment for the waiver if the employer paying for the waiver of coverage is outside of the State Health Benefits Program or the School Employee’s Health Benefits Program and if the employer provides such waivers.

The bill also changes eligibility for payments for waiving health care benefits coverage by providing that a local elected official whose term of office commences after the effective date of the bill will not be eligible for a payment in consideration for filing a waiver of any health care benefits coverage. Also, the bill requires public employers to annually reauthorize the allowance of waivers. Current law limits payments for waiver of health care benefits coverage filed after May 21, 2010 to an amount, established by the employer that does not exceed 25 percent, or $5,000, whichever is less, of the amount saved by the employer because of the employee’s waiver of coverage.

The bill provides that a board of education that offers health care benefits will be able to allow any employee who is eligible for other health care coverage to waive coverage under the board of education’s plan, and may offer to its employees, but not to an elected official whose term of office commenced after the effective date of the bill, a payment amount subject to the collective bargaining process. The bill requires the payment if it is provided for in a collective bargaining agreement.