Senate Bill No. 298–Committee on Government Affairs

 

(On Behalf of Public Employees’ Benefits Program)

 

March 8, 2001

____________

 

Referred to Committee on Government Affairs

 

SUMMARY—Revises provisions relating to public employees’ benefits program. (BDR 23‑542)

 

FISCAL NOTE:            Effect on Local Government: No.

                                    Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to the public employees’ benefits program; extending the period in which certain persons must notify the program of their decision regarding coverage under the program; revising the power of the board of the program to establish certain rates and coverage; requiring the board to appoint an attorney to review the program; requiring the board to establish a checking account for the payment of claims; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1    Section 1.  NRS 287.023 is hereby amended to read as follows:

1-2    287.023  1.  Whenever an officer or employee of the governing body

1-3  of any county, school district, municipal corporation, political subdivision,

1-4  public corporation or other public agency of the State of Nevada retires

1-5  under the conditions set forth in NRS 286.510 or 286.620 and, at the time

1-6  of his retirement, was covered or had his dependents covered by any group

1-7  insurance or medical and hospital service established pursuant to NRS

1-8  287.010 and 287.020, the officer or employee has the option upon

1-9  retirement to cancel or continue any such group insurance or medical and

1-10  hospital service coverage or join the public employees’ benefits program to

1-11  the extent that such coverage is not provided to him or a dependent by the

1-12  Health Insurance for the Aged Act, 42 U.S.C. §§ 1395 et seq.

1-13    2.  A retired person who continues coverage under the public

1-14  employees’ benefits program shall assume the portion of the premium or

1-15  membership costs for the coverage continued which the governing body

1-16  does not pay on behalf of retired officers or employees. A person who joins

1-17  the public employees’ benefits program for the first time upon retirement

1-18  shall assume all costs for the coverage. A dependent of such a retired

2-1  person has the option, which may be exercised to the same extent and in

2-2  the same manner as the retired person, to cancel or continue coverage in

2-3  effect on the date the retired person dies. The dependent is not required to

2-4  continue to receive retirement payments from the public employees’

2-5  retirement system to continue coverage.

2-6    3.  Except as otherwise provided in NRS 287.0235, notice of the

2-7  selection of the option must be given in writing to the last public employer

2-8  of the officer or employee within [30] 60 days after the date of retirement

2-9  or death, as the case may be. If no notice is given by that date, the retired

2-10  employee and his dependents shall be deemed to have selected the option

2-11  to cancel the coverage or not to join the public employees’ benefits

2-12  program, as the case may be.

2-13    4.  The governing body of any county, school district, municipal

2-14  corporation, political subdivision, public corporation or other public

2-15  agency of this state may pay the cost, or any part of the cost, of group

2-16  insurance and medical and hospital service coverage for persons eligible

2-17  for that coverage pursuant to subsection 1, but it must not pay a greater

2-18  portion than it does for its current officers and employees.

2-19    Sec. 2.  NRS 287.043 is hereby amended to read as follows:

2-20    287.043  1.  The board shall:

2-21    (a) Establish and carry out a program to be known as the public

2-22  employees’ benefits program which:

2-23      (1) Must include a program relating to group life, accident or health

2-24  insurance, or any combination of these; and

2-25      (2) May include a program to reduce taxable compensation or other

2-26  forms of compensation other than deferred compensation,

2-27  for the benefit of all state officers and employees and other persons who

2-28  participate in the program.

2-29    (b) Ensure that the program is funded on an actuarially sound basis and

2-30  operated in accordance with sound insurance and business practices.

2-31    2.  In establishing and carrying out the program, the board shall:

2-32    (a) Except as otherwise provided in this paragraph, negotiate and

2-33  contract with the governing body of any public agency enumerated in NRS

2-34  287.010 which is desirous of obtaining group insurance for its officers,

2-35  employees and retired employees by participation in the program. The

2-36  board [shall] may establish separate rates and coverage for those officers,

2-37  employees and retired employees based on actuarial reports.

2-38    (b) Give public notice in writing of proposed changes in rates or

2-39  coverage to each participating public employer who may be affected by the

2-40  changes. Notice must be provided at least 30 days before the effective date

2-41  of the changes.

2-42    (c) Purchase policies of life, accident or health insurance, or any

2-43  combination of these, or, if applicable, a program to reduce the amount of

2-44  taxable compensation pursuant to 26 U.S.C. § 125, from any company

2-45  qualified to do business in this state or provide similar coverage through a

2-46  plan of self-insurance established pursuant to NRS 287.0433 for the benefit

2-47  of all eligible public officers, employees and retired employees who

2-48  participate in the program.

3-1    (d) Except as otherwise provided in this Title, develop and establish

3-2  other employee benefits as necessary.

3-3    (e) Investigate and approve or disapprove any contract proposed

3-4  pursuant to NRS 287.0479.

3-5    (f) Adopt such regulations and perform such other duties as are

3-6  necessary to carry out the provisions of NRS 287.0402 to 287.049,

3-7  inclusive, including, without limitation, the establishment of:

3-8       (1) Fees for applications for participation in the program and for the

3-9  late payment of premiums or contributions;

3-10      (2) Conditions for entry and reentry into the program by public

3-11  agencies enumerated in NRS 287.010;

3-12      (3) The levels of participation in the program required for employees

3-13  of participating public agencies;

3-14      (4) Procedures by which a group of participants in the program may

3-15  leave the program pursuant to NRS 287.0479 and conditions and

3-16  procedures for reentry into the program by such participants; and

3-17      (5) Specific procedures for the determination of contested claims.

3-18    (g) Appoint an independent certified public accountant. The accountant

3-19  shall [provide:

3-20      (1) An] :

3-21      (1) Provide an annual audit of the program; and

3-22      [(2) A biennial audit of the program to determine whether the

3-23  program complies with federal and state laws relating to taxes and

3-24  employee benefits.

3-25  The accountant shall report]

3-26      (2) Report to the board and the interim retirement and benefits

3-27  committee of the legislature created pursuant to NRS 218.5373.

3-28    (h) Appoint an attorney who specializes in employee benefits. The

3-29  attorney shall:

3-30      (1) Perform a biennial review of the program to determine whether

3-31  the program complies with federal and state laws relating to taxes and

3-32  employee benefits; and

3-33      (2) Report to the board and the interim retirement and benefits

3-34  committee of the legislature created pursuant to NRS 218.5373.

3-35    3.  The board may use any services provided to state agencies and shall

3-36  use the services of the purchasing division of the department of

3-37  administration to establish and carry out the program.

3-38    4.  The board may make recommendations to the legislature concerning

3-39  legislation that it deems necessary and appropriate regarding the program.

3-40    5.  The state and any other public employers that participate in the

3-41  program are not liable for any obligation of the program other than

3-42  indemnification of the board and its employees against liability relating to

3-43  the administration of the program, subject to the limitations specified in

3-44  NRS 41.0349.

3-45    6.  As used in this section, “employee benefits” includes any form of

3-46  compensation provided to a [state employee pursuant to this Title] public

3-47  employee except federal benefits, wages earned, legal holidays, deferred

3-48  compensation and benefits available pursuant to chapter 286 of NRS.

 

4-1    Sec. 3.  NRS 287.0435 is hereby amended to read as follows:

4-2    287.0435  1.  All money received for the program, including, without

4-3  limitation, premiums and contributions, must be deposited in the state

4-4  treasury for credit to the fund for the public employees’ benefits program

4-5  which is hereby created as a trust fund. The fund must be accounted for as

4-6  an internal service fund. Payments into and disbursements from the fund

4-7  must be so arranged as to keep the fund solvent at all times.

4-8    2.  The money in the fund must be invested as other money of the state

4-9  is invested and any income from investments paid into the fund for the

4-10  benefit of the fund.

4-11    3.  Disbursements from the fund must be made as any other claims

4-12  against the state are paid.

4-13    4.  The state treasurer may charge a reasonable fee for his services in

4-14  administering the fund, but the state, the state general fund and the state

4-15  treasurer are not liable to the fund for any loss sustained by the fund as a

4-16  result of any investment made on behalf of the fund or any loss sustained in

4-17  the operation of the program.

4-18    5.  The board shall deposit any disbursement received from the fund

4-19  into an interest-bearing checking account in a bank or credit union

4-20  qualified to receive deposits of public money. Claims that have been

4-21  submitted to the program and approved must be paid from the account,

4-22  and any refund of such a claim must be deposited into the account.

4-23    Sec. 4.  NRS 287.045 is hereby amended to read as follows:

4-24    287.045  1.  Except as otherwise provided in this section, every officer

4-25  or employee of the state is eligible to participate in the program on the first

4-26  day of the month following the completion of 90 days of full-time

4-27  employment.

4-28    2.  Professional employees of the University and Community College

4-29  System of Nevada who have annual employment contracts are eligible to

4-30  participate in the program on:

4-31    (a) The effective dates of their respective employment contracts, if

4-32  those dates are on the first day of a month; or

4-33    (b) The first day of the month following the effective dates of their

4-34  respective employment contracts, if those dates are not on the first day of a

4-35  month.

4-36    3.  Every officer or employee who is employed by a participating

4-37  public agency on a permanent and full-time basis on the date the agency

4-38  enters into an agreement to participate in the program, and every officer or

4-39  employee who commences his employment after that date , is eligible to

4-40  participate in the program on the first day of the month following the

4-41  completion of 90 days of full-time employment.

4-42    4.  Every senator and assemblyman is eligible to participate in the

4-43  program on the first day of the month following the 90th day after his

4-44  initial term of office begins.

4-45    5.  An officer or employee of the governing body of any county, school

4-46  district, municipal corporation, political subdivision, public corporation or

4-47  other public agency of the State of Nevada who retires under the conditions

4-48  set forth in NRS 286.510 or 286.620 and was not participating in the

4-49  program at the time of his retirement is eligible to participate in the

5-1  program [30] 60 days after notice of the selection to participate is given

5-2  pursuant to NRS 287.023 or 287.0235. The board shall make a separate

5-3  accounting for these retired persons. For the first year following

5-4  enrollment, the rates charged must be the full actuarial costs determined by

5-5  the actuary based upon the expected claims experience with these retired

5-6  persons. The claims experience of these retired persons must not be

5-7  commingled with the retired persons who were members of the program

5-8  before their retirement, nor with active employees of the state. After the

5-9  first year following enrollment, the rates charged must be the full actuarial

5-10  costs determined by the actuary based upon the past claims experience of

5-11  these retired persons since enrolling.

5-12    6.  Notwithstanding the provisions of subsections 1, 3 and 4, if the

5-13  board does not, pursuant to NRS 689B.580, elect to exclude the program

5-14  from compliance with NRS 689B.340 to 689B.600, inclusive, and if the

5-15  coverage under the program is provided by a health maintenance

5-16  organization authorized to transact insurance in this state pursuant to

5-17  chapter 695C of NRS, any affiliation period imposed by the program may

5-18  not exceed the statutory limit for an affiliation period set forth in NRS

5-19  689B.500.

5-20    Sec. 5.  This act becomes effective upon passage and approval.

 

5-21  H