ASSEMBLY APPROPRIATIONS COMMITTEE

STATEMENT TO

[First Reprint]

ASSEMBLY, No. 1670

STATE OF NEW JERSEY

DATED: NOVEMBER 6, 1997

      The Assembly Appropriations Committee reports favorably Assembly Bill No. 1670 (1R).

      Assembly Bill No. 1670 (1R) allows plan beneficiaries of the Teachers' Pension and Annuity Fund (TPAF) or the Public Employees' Retirement System (PERS) to opt for deduction of their dental insurance premiums from their retirement allowances.

      Current law provides that, if possible, whenever a beneficiary of TPAF or PERS requests in writing that the Division of Pensions and Benefits make deductions from the beneficiary's retirement allowance or pension for the payment of premiums for the beneficiary's group health insurance plan or the State Health Benefits Program, the division may make the deductions and transmit the sums deducted to the insurance plan carrier. The bill extends this deduction authorization option to the beneficiaries' dental insurance plan premiums, subject to the condition that at least 1,000 beneficiaries covered by a dental plan would have to request the deduction before the division would be required to make deductions from that plan.

      The committee recommends that floor amendments be adopted to the bill that would encourage the State Treasurer and the Division of Pensions and Benefits to negotiate with each provider of a group dental insurance plan for which deductions are made pursuant to this bill for the payment of a reasonable administrative fee to be paid to the State to cover the administrative costs of making the deductions.

      This bill is identical to Senate Bill No. 119 (2R) as reported by this committee.

FISCAL IMPACT:

      The bill is expected to have minimal fiscal impact. The dental premium option would be administered as an adjunct to the existing health insurance deduction program.