SENATE, No. 1293

STATE OF NEW JERSEY

INTRODUCED JUNE 3, 1996

By Senators DiFRANCESCO, EWING, Inverso, Ciesla and Connors

An Act concerning health benefits coverage for public employees, amending P.L.1995, c.259, and supplementing Title 18A of the New Jersey Statutes.

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

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

    36.  Notwithstanding the provisions of any other law to the contrary, a county, municipality, or school district 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 coverage as a dependent of the employee's spouse under that program or under another health benefits plan offered by the spouse's employer, whether a public or private employer, to waive coverage under the State Health Benefits Program to which the employee is entitled by virtue of employment with the municipality. 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 county, municipality, or school district 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 county, municipality, or school district the amount of any premium previously paid by the county, municipality, or school district with respect to any period of coverage which followed the filing date. In consideration of filing such a waiver, a county, municipality, or school district may pay to the employee annually an amount, to be established in the sole discretion of the county, municipality, or school district, which shall not exceed 50% of the amount saved by the county, municipality, or school district 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 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 from the county, municipality, or school district 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 county, municipality, or school district 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 a county, municipality, or school district 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.1995, c.259, s.36)

    2. 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 or municipality 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 coverage as a dependent of the employee's spouse under that plan or another plan, including the State Health Benefits Program established pursuant to P.L.1961, c.49 (C.52:14-17.25 et seq.), offered by the spouse's employer, whether a public or private employer, to waive coverage under the county or municipality's plan to which the employee is entitled by virtue of employment with the county or municipality. The waiver shall be in such form as the county or municipality shall prescribe and shall be filed with the county or municipality. In consideration of filing such a waiver, a county or municipality may pay to the employee annually an amount, to be established in the sole discretion of the county or municipality, which shall not exceed 50% of the amount saved by the county or municipality 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 or municipality, in such form as the county or municipality shall prescribe, that the waiver is revoked. The decision of a county or municipality 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.1995, c.259, s.37)

    3. (New section) Notwithstanding the provisions of any other law to the contrary, a local 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 coverage as a dependent of the employee's spouse under that plan or another plan, including the State Health Benefits Program established pursuant to P.L.1961, c.49 (C.52:14-17.25 et seq.), offered by the spouse's employer, whether a public or private employer, to waive coverage under the board of education's plan to which the employee is entitled by virtue of employment with the board. The waiver shall be in such form as the board shall prescribe and shall be filed with the board. In consideration of filing such a waiver, a board may pay to the employee annually an amount, to be established in the sole discretion of the board, which shall not exceed 50% of the amount saved by the board 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, in such form as the board shall prescribe, that the waiver is revoked. The decision of a board 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.

    4. This act shall take effect immediately.

STATEMENT

    In the recently enacted law which eased various State-imposed mandates on local governments, P.L.1995, c.259, a municipality which participates in the State Health Benefits Program or another group health benefits plan was authorized to permit an employee who is eligible for health care coverage as a dependent of the employee's spouse to waive coverage to which the employee is entitled as an employee of the municipality. The municipality was also authorized to pay an employee who waives coverage an amount not to exceed 50% of the amount saved by the municipality because of the waiver.

    This bill extends the same authority to counties and school districts with respect to their employees and thus extends to these entities the relief from State mandates provided by P.L.1995, c.259. This will permit counties and school districts to reduce their expenditures in providing health care coverage to their employees and by extension will enable these entities to provide property tax relief.

Extends to counties and school districts the ability to permit employees to waive health care coverage and receive in payment a portion of money saved.