January 19, 2011, Introduced by Senator JANSEN and referred to the Committee on Reforms, Restructuring and Reinventing.
A bill to limit a public employer's portion of the cost of
health insurance benefits; and to provide for exceptions.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"publicly funded health insurance contribution act".
Sec. 3. As used in this act:
(a) "Costs" of a medical benefit plan and "total costs" of
medical benefit plans do not include copayments, coinsurance,
deductibles, other out-of-pocket expenses, or other service-related
fees assessed to the coverage beneficiary.
(b) "Local unit of government" means a city, county, township,
or village.
(c) "Medical benefit plan" means a plan established and
maintained by a carrier or 1 or more public employers that provides
for the payment of medical, optical, or dental benefits, including,
but not limited to, hospital and physician services, prescription
drugs, and related benefits, to public employees.
(d) "Public employer" means this state; a city, village,
township, county, or other political subdivision of this state; any
intergovernmental, metropolitan, or local department, agency, or
authority, or other local political subdivision; a school district,
a public school academy, or an intermediate school district, as
those terms are defined in sections 4 to 6 of the revised school
code, 1976 PA 451, MCL 380.4 to 380.6; a community college or
junior college described in section 7 of article VIII of the state
constitution of 1963; or an institution of higher education
described in section 4 of article VIII of the state constitution of
1963.
Sec. 5. (1) Except as otherwise provided in this act,
beginning January 1, 2013, a public employer that offers only non-
self-funded medical benefit plans to its employees or elected
officials shall pay no more of each employee's or elected official's
medical benefit plan costs than an amount equal to 80% of the total
cost for all of the medical benefit plans it offers to its
employees and elected officials on the effective date of this act
divided by the total number of covered employees and elected
officials. However, the percentage used to calculate the maximum
allowable payment under this section may be increased to 90% for an
employee or elected official who is covered by a medical benefit
plan that includes a health savings account as described in section
223 of the internal revenue code of 1986, 26 USC 223, in
combination with a high deductible health plan that complies with
federal statute and regulations. If a public employer is not in
existence on the effective date of this act, the maximum allowable
payment under this section shall be the indicated percentage of the
total cost for all of the medical benefit plans it offers to its
employees and elected officials on the date it becomes a public
employer divided by the total number of covered employees and
elected officials. The maximum allowable payments calculated under
this section apply whether the medical benefit plan provides
coverage for the employee or elected official only or includes
coverage for the employee's or elected official's family or
dependents.
(2) The public employer shall adjust the maximum allowable
payment calculated under this section annually, based on the most
comprehensive index of consumer prices available for the Detroit
area from the United States department of labor, bureau of labor
statistics.
(3) A public employer that is formed by the merger of 2 or
more public employers after the effective date of this act and that
offers no self-funded medical benefit plan shall calculate the
maximum allowable payment under subsection (1) as of the date the
new public entity comes into existence.
Sec. 7. Except as otherwise provided in this act, beginning
January 1, 2013, a public employer that offers 1 or more self-
funded medical benefit plans to its employees or elected officials
shall pay no more than 80% of the cost per covered employee or
elected officer of any self-funded or non-self-funded medical
benefit plan. However, the maximum percentage a public employer may
pay under this section is increased to 90% for an employee or
elected official who is covered by a medical benefit plan that
includes a health savings account as described in section 223 of
the internal revenue code of 1986, 26 USC 223, in combination with
a high deductible health plan that complies with federal statutes
and regulations. The maximum allowable payments calculated under
this section apply whether the medical benefit plan provides
coverage for the employee or elected official only or includes
coverage for the employee's or elected official's family or
dependents.
Sec. 9. A public employer may contribute to an employee's or
elected official's health savings account as permitted in section
223 of the internal revenue code of 1986, 26 USC 223, and this
contribution is not included in the public employer's maximum
allowable payment for the cost of medical benefit plans established
in this act.
Sec. 11. A public employer may deduct the covered employee's
or elected public officer's portion of the cost of a medical
benefit plan from compensation due to the covered employee or
elected officer. The employer may condition eligibility for the
medical benefit plan on the employee's or elected official's
authorizing the public employer to make the deduction.
Sec. 13. If a collective bargaining agreement or other
contract that is inconsistent with section 5 or 7 is in effect for
a group of employees of a public employer on the effective date of
this act, the requirements of section 5 or 7 do not apply to that
group of employees until the collective bargaining agreement or
other contract expires or is amended, extended, or renewed.
Sec. 15. The requirements of section 5 or 7 apply to all
public employees to the greatest extent consistent with
constitutionally allocated powers, whether or not a public employee
is a member of a collective bargaining unit.
Sec. 17. (1) By a 2/3 vote of its governing body, a local unit
of government may exempt itself from the requirements of this act
for the next succeeding contract period.
(2) Another 2/3 vote of the governing body of the local unit
of government is required to extend an exemption under this section
to a new contract period after a contract for medical benefit plan
expires or terminates or is amended, extended, or renewed.