Revision: Jan. 6, 2016, midnight
\t \t\tSB 495-FN-A - AS INTRODUCED
2016 SESSION
\t16-2952
\t10/09
SENATE BILL\t495-FN-A
AN ACT\trelative to state retiree health plan costs and funding.
SPONSORS:\tSen. Feltes, Dist 15; Sen. Fuller Clark, Dist 21; Sen. Kelly, Dist 10; Sen. Soucy, Dist 18; Sen. Watters, Dist 4; Sen. Woodburn, Dist 1
COMMITTEE:\tFinance
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ANALYSIS
\tThis bill requires that state retiree and spouse health insurance premium contributions and health plan out-of-pocket expenses do not exceed certain limits during the biennium ending June 30, 2017. The bill also requires the commissioner of administrative services to contract with a health care consultant to study changes necessary to sustain long-term funding of state retiree health benefits. The bill makes an appropriation to the department of administrative services to fund the health plan requirements and health care consultant cost.
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Explanation:\tMatter added to current law appears in bold italics.
\t\tMatter removed from current law appears [in brackets and struckthrough.]
\t\tMatter which is either (a) all new or (b) repealed and reenacted appears in regular type.
\t16-2952
\t10/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Sixteen
AN ACT\trelative to state retiree health plan costs and funding.
Be it Enacted by the Senate and House of Representatives in General Court convened:
\t1 State Employees Group Insurance; State Retiree Premium Contribution; Contingent Appropriation. For the biennium ending June 30, 2017, the premium contribution percent established by the commissioner of administrative services under RSA 21-I:30, XIII for retired state employees and spouses who are not Medicare eligible shall not exceed 15 percent. Any sum necessary to fully fund the health insurance plan for such retired state employees and spouses shall be paid from the surplus in the employee and retiree benefit risk management fund established under RSA 21-I:30-e. To the extent the surplus in the employee and retiree benefit risk management fund is insufficient to fund the amount, there is hereby appropriated such amount necessary to fund the shortfall. The governor is authorized to draw a warrant for said sum out of any money in the treasury not otherwise appropriated.
\t2 State Retiree Health Benefits; Plan Changes. For the biennium ending June 30, 2017, the health benefit plan for retired state employees and spouses approved under RSA 21-I:26-36 shall not include maximum out-of-pocket expenses for both Medicare eligible and non-Medicare eligible retirees in the plan which exceed $500 for an individual or $1,000 for a family per plan year.
\t3 Health Care Consultant Contract; Duties; Report; Appropriation.
\t\tI. The commissioner of administrative services is hereby authorized to contract with a health care consultant for the purpose of studying changes to the retiree health plan to sustain long-term funding for state retiree health benefits.
\t\tII.(a) The health care consultant shall review, among other matters, the populations affected by in-network versus out-of-network care, the impact of maximum out-of-pocket expenses, means testing, and hardship waivers.
\t\t\t(b) The health care consultant shall file an interim report with the commissioner of administrative services and the joint legislative fiscal committee on or before September 1, 2016 specifically addressing any findings on populations affected by in-network versus out-of-network care, and the impact of maximum out-of-pocket expenses.
\t\t\t(c) The health care consultant shall file a final report on all matters before it with the commissioner of administrative services and the joint legislative fiscal committee on or before January 1, 2017.
\t\tIII. In order to fund the cost of the consultant under paragraph I, the sum determined by the commissioner of the department of administrative services is hereby appropriated to the commissioner for the purpose of payment for the health care consultant contract. The governor is authorized to draw a warrant for said sum out of any money in the treasury not otherwise appropriated.
\t4 Effective Date. This act shall take effect upon its passage.
\t\t\t\t\t\t\t\t\t\t\t16-2952
\t\t\t\t\t\t\t\t\t\t\t1/6/16
SB 495-FN-A- FISCAL NOTE
AN ACT\trelative to state retiree health plan costs and funding.
FISCAL IMPACT:
The Department of Administrative Services states this bill, as introduced, will increase state expenditures by an indeterminable amount in FY 2017. There will be no fiscal impact to state, county, and local revenue or county and local expenditures.
This bill appropriates an unspecified amount of state general funds for the biennium ending June 30, 2017, to the Department of Administrative Services for the purpose of addressing any shortfall in funding for the state retiree health program.
This bill appropriates an unspecified amount of state general funds to the Department of Administrative Services for the purpose of paying for a health care consultant.
METHODOLOGY:
The Department of Administrative Services states this bill requires the Commissioner to establish the premium contribution rate for under 65 retired state employees and spouses (non-Medicare eligible) to not exceed 15 percent for the biennium ending June 30, 2017. This bill requires the Department to fully fund the health insurance plan for retired state employees and spouses with the surplus in the employee and retiree benefit risk management fund. To the extent the surplus is insufficient, this bill authorizes the governor to draw a warrant from the treasury and appropriates the money to cover any shortfall. This bill prohibits out-of-pocket expenses greater than $500 for an individual and $1,000 for a family per plan year for both Medicare eligible and non-Medicare eligible retired state employees and spouses. The Department estimates the following fiscal impact resulting from the aforementioned provisions of this bill:
Estimated Impact to State Retiree Health Plan | ||||||
| Plan Component | Changes | Estimated Savings/(Cost) From Current Plan Design | |||
| ||||||
Current Plan | Retiree <65 Medical** | In-Network $1,000 individual / $2,000 family Maximum Out-of-Pocket | $0 | |||
All Retiree Rx | Retail Copayments: $10 / $25 / $40 | $1,417,000 | ||||
Retiree <65 Contribution *** | Increase by 5.0% from 12.5% to 17.5% of rate | $1,724,000 | ||||
Total |
| $3,141,000 | ||||
| ||||||
Proposed Bill | Retiree <65 Medical** | In-Network $500 individual / $1,000 family Maximum Out-of-Pocket | ($615,000) | |||
All Retiree Rx | Retail Copayments: $10 / $25 / $40 | $1,205,000 | ||||
Retiree <65 Contribution *** | Increase by 2.5% from 12.5% to 15.0% of rate | $862,000 | ||||
Total |
| $1,452,000 | ||||
| ||||||
Difference | Retiree <65 Medical** |
| ($615,000) | |||
All Retiree Rx |
| ($212,000) | ||||
Retiree <65 Contribution *** |
| ($862,000) | ||||
Total |
| ($1,689,000) | ||||
Notes: | ||||||
The Department of Administrative Services states this bill authorizes the Commissioner to contract with a health care consultant for the purpose of studying changes to the retiree health plan. This bill makes an unspecified appropriation to pay for the cost of the health care consultant.
The New Hampshire Retirement System states this bill will have no fiscal impact on its operations.