BILL NUMBER: AB 2383 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 14, 2000
AMENDED IN SENATE JUNE 22, 2000
AMENDED IN ASSEMBLY MAY 26, 2000
AMENDED IN ASSEMBLY APRIL 6, 2000
INTRODUCED BY Assembly Members Keeley and Honda
FEBRUARY 24, 2000
An act to add and repeal Chapter 3 (commencing with
Section 25200) of Part 13.5 of Division 1 of Title 1 of the
An act to add Section 25050 to the Education Code, and to
add Article 10 (commencing with Section 22878) to Chapter 1 of Part
5 of Division 5 of Title 2 of the Government Code, relating to
health benefits, and making an appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
AB 2383, as amended, Keeley. Public employee health
benefits: covered employees: retiree health benefits.
(1) Existing law, the Public Employees' Medical and Hospital Care
Act, defines "employee" for purposes of eligibility for benefits
under the act and excludes from that definition specified officers
and employees who are employed less than half time. Employee
contributions under the act are deposited in the Public Employees'
Health Care Fund, a continuously appropriated fund.
This bill would make the provisions of that act applicable to
specified employees of a school or agency, as defined, at the option
of its governing body, and would authorize the State Teachers'
Retirement System to become a contracting agency for certain retired
members and or retired classified
employees or both . The bill would define annuitants for
purposes of these provisions, and would prohibit a school or agency
from maintaining another health benefits plan unless it complies with
the provisions of the Public Employees' Medical and Hospital Care
Act and is equally available to its retired members, its active
employees, and their family members without discrimination as to
benefits, premiums, or employer contributions. By expanding
eligibility for benefits under the act, the bill would increase the
contributions to a continuously appropriated fund, thereby making an
appropriation.
(2) Existing law, the Teachers' Retirement Law, provides that the
State Teachers' Retirement System shall develop a program to provide
health care benefits for members, beneficiaries, children, and
dependent parents, as defined. Under existing law,
employers contribute monthly to the Teachers' Retirement Fund 8% of
creditable compensation, as defined.
This bill would require the Teachers' Retirement Board to
credit each employer and employing agency who provides benefits to
its retired members under the Defined Benefit Program of the Teachers'
Retirement Plan the sum of $120, adjusted annually, as specified,
for each retired member enrolled in one or more specified programs,
up to, but not exceeding, a total credit of $2,000,000,000, against
its employer contributions to the system.
These provisions of the bill would become inoperative on July 1,
2011, and would be repealed January 1, 2012 develop 3
plans to provide certain health benefits to retired members, as
specified, and to report to specified legislative committees on or
before March 1, 2001, regarding the costs and legislation necessary
to implement those plans .
Vote: majority. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 3 (commencing with Section 25200) is added to
Part 13.5 of Division 1 of Title 1 of the Education Code, to read:
CHAPTER 1. RETIRED MEMBER CREDITS
25200. (a) In order to encourage employers and employing agencies
to provide health care benefits to retired members of the Defined
Benefit Program, the board shall credit an amount equal to a present
value of up to two billion dollars ($2,000,000,000), as specified in
subdivision (b), to employers and employing agencies that provide
health care benefits to retired members formerly employed by the
employer or employing agency.
(b) Subject to subdivisions (d) and (e), commencing July 1, 2001,
the board shall credit each employer, against the amount contributed
pursuant to Section 22950, the sum of one hundred twenty dollars
($120), adjusted annually by the change in state employer
contributions for a single enrolled annuitant, as determined by
Section 22825.1 of the Government Code, for each retired member the
employer or employing agency has certified, in a manner required by
the board, is enrolled in one or more of the following programs
administered or sponsored by the employer or employing agency:
(1) A catastrophic health care program for retired members who are
less than 65 years of age.
(2) A Medicare supplement health care program.
(3) A prescription drug program.
(4) A health program provided pursuant to Part 5 (commencing with
Section 22751) of Division 5 of Title 2 of the Government Code.
(c) The Teachers' Retirement Board shall establish by regulation
the services to be provided in a program specified in subdivision
(b). The required services shall be comparable to those generally
available to participants of comparable programs made available by
other public employers in California.
(d) The amount credited pursuant to subdivision (b) for each
retired member shall not exceed the employer's average costs of
health care benefits to retired members formerly employed by the
employer or employing agency.
(e) No amount shall be credited pursuant to this section when the
present value of the total amount credited to all employers and
employing agencies is equal to or exceeds two billion dollars
($2,000,000,000).
25201. This chapter shall become inoperative on July 1, 2011,
and, as of January 1, 2012, is repealed, unless a later enacted
statute that is enacted before January 1, 2012, deletes or extends
the dates on which it becomes inoperative and is repealed.
SECTION 1. Section 25050 is added to the Education Code, to read:
25050. (a) The Teachers' Retirement Board shall develop:
(1) A prescription drug insurance plan for all retired members.
(2) A supplemental health insurance plan for all retired members
who have not yet attained the age of Medicare eligibility.
(3) A flexible plan to encourage employers and employing agencies
to provide health care benefits to their retirees by crediting those
employers and employing agencies, against the amount contributed
pursuant to Section 22950, a monthly amount, that would be adjusted
annually, for each retiree the employer or employing agency certifies
is enrolled in one or more health care benefits programs
administered or sponsored by the employer or employing agency. Those
programs would include a catastrophic health care program for
retirees who are less than 65 years of age, a Medicare supplement
health care program, a prescription drug program, and a health
program provide pursuant to Part 5 (commencing with Section 22751) of
Division 5 of Title 2 of the Government Code.
(b) Development of each plan shall be completed on or before March
1, 2001.
(c) Upon completion of the development of the plans, the board
shall prepare and deliver a report to the chairs of the appropriate
policy and fiscal committees of the Legislature that shall include an
estimate of the costs of implementation for each plan and draft
statutory language that could be proposed to implement each of the
plans.
SEC. 2. Article 10 (commencing with Section 22878) is added to
Chapter 1 of Part 5 of Division 5 of Title 2 of the Government Code,
to read:
Article 10. Optional Health Benefits
22878. The provisions of this part also apply to schools and
agencies, as specified in this article. The purpose of this article
is to set forth optional provisions which may only be used by schools
and agencies. If schools and agencies choose to follow the optional
provisions of this article, all conflicting provisions of this part
are superseded. This article shall not apply to any other employer,
employee, annuitant, or family member who has, or elects to have,
health care coverage pursuant to this part.
22878.1. The definitions in this part shall govern the
interpretation of terms in this article, except that the following
definitions shall govern the interpretation of these specific terms
as used in this article:
(a) "School" means any contracting agency that is a special
district, school district, county board of education, personnel
commission of a school district, a county superintendent of schools,
or a community college district.
(b) "Agency" means any contracting agency, as defined in Section
20022, any county or special district subject to the County Employees
Retirement Law of 1937 (Chapter 3 (commencing with Section 31450) of
Part 3 of Division 4 of Title 3) and any contracting agency that is
a public body or agency within California not covered by the Public
Employees' Retirement System or subject to the County Employees
Retirement Law of 1937, that provides a retirement system for its
employees funded wholly or in part by public funds.
22878.2. (a) A school or agency may by resolution filed with the
board deem all permanent or regular employees, except members of the
State Teachers' Retirement System, who have an appointment of six
months or longer but who are employed on less than half-time basis,
to be employees subject to this part.
(b) An agency or school with employees who are members of the
State Teachers' Retirement System may by resolution filed with the
board deem any of the following to be employees subject to this part:
(1) Regular, permanent, probationary, or temporary employees who
have an appointment for a semester, for six months, or for half of
the school year or longer, but are employed on less than a half-time
basis.
(2) Substitutes who have an appointment for a semester, for six
months, or for half of the school year or longer, but are employed on
less than a half-time basis.
(3) Substitutes who have an appointment for 100 days or more in
the school year.
22878.3. The State Teachers' Retirement System may, by resolution
filed with the board, become a contracting agency subject to this
part only with respect to either or both of the following:
(a) Retired members of the State Teachers' Retirement System
enrolled in both Parts A and B of Medicare whose former education
employer does not offer health care coverage for them, their eligible
family members, and surviving spouses.
(b) Classified Retired classified
employees enrolled in both Parts A and B of Medicare whose former
education employer does not offer health care coverage for them,
their eligible family members, and surviving spouses.
22878.4. All of the following shall be deemed to be "annuitants"
subject to this part:
(a) A family member of a deceased retired member of the State
Teachers' Retirement System who retired within 120 days of separation
from employment, and who prior to his or her death, received a
retirement allowance that did not provide for a survivor allowance to
family members and who elects coverage as an annuitant prior to
January 1, 2003. This subdivision shall not apply to any family
member of a retired member of the State Teachers' Retirement System
who retired on or after January 1, 2003 from a school contracting
under this part prior to January 1, 2001.
(b) A retired member of the State Teachers' Retirement System who
retired within 120 days of separation from employment, and who
retired before the member's school elected to contract for health
benefit coverage under this part, and who elects coverage as an
annuitant within one calendar year from the date that the member's
school elected to contract for health benefit coverage under this
part.
(c) A family member of a deceased retired member of the State
Teachers' Retirement System who retired within 120 days of separation
from employment, and who retired before the member's school elected
to contract for health benefit coverage under this part, and who
elects coverage as an annuitant within one calendar year from the
date that the member's school elected to contract for health benefit
coverage under this part.
22878.5. A school or agency may not maintain another health
benefits plan unless the plan complies with the requirements of this
part and is equally available to its retired employees, its active
employees, and their family members, without discrimination as to
benefits, premiums, or employer contributions.