This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives.
STORAGE NAME: h1443b.SAT
DATE: 2/14/2022
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: HB 1443 Dependent Eligibility Verification Services
SPONSOR(S): Giallombardo
TIED BILLS: HB 1445 IDEN./SIM. BILLS: SB 1660
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Finance & Facilities Subcommittee 15 Y, 0 N Poche Lloyd
2) State Administration & Technology
Appropriations Subcommittee
Helpling Topp
3) Health & Human Services Committee
SUMMARY ANALYSIS
The State Group Insurance Program (SGI Program) is administered by the Division of State Group Insurance
(DSGI) within the Department of Management Services (DMS). The SGI Program is an optional benefit for
state employees employed by state agencies, state universities, the court system, and the Legislature. The
SGI Program administers health, life, dental, vision, disability, and other supplemental insurance benefits.
The SGI Program covers employees and retirees of state agencies and their eligible dependents. Dependents
include, for example, a current spouse, a biological child, child with a qualified medical support order, legally
adopted child, or child placed in the home for the purpose of adoption, and a stepchild. Dependents may be
added as covered dependents during the open enrollment period each year or in the event of a qualifying
status change. Minimal information is collected by the DMS to determine eligibility.
During the 2017 Legislative Session, the Division of State Group Insurance (DSGI) within DMS was directed to
contract with a vendor to verify the eligibility of all dependents participating in the SGI Program. On July 1,
2020, DMS began requesting subscribers to provide documents as part of the dependent eligibility verification
process. The documents include tax transcripts from the Internal Revenue Service, marriage licenses, birth
certificates, adoption documents, and other documents. At the beginning of FY 2020-21, DMS received funding
to continue the statewide dependent eligibility audit for newly added dependents on an on-going basis. The
on-going audit began on July 1, 2020, and continues today. Additionally, DMS conducted a gap audit that
began in August 2021 and includes all covered dependents that were added after the original dependent
eligibility audit in 2018. The gap audit is scheduled to conclude in May 2022.
HB 1443 permits DMS, instead of DSGI, to provide or contract for dependent eligibility verification services for
the SGI Program on an ongoing basis. The bill makes conforming changes to convert the former audit project
into an ongoing audit program for DMS. Also, all documentation submitted by subscribers for the ongoing
audit must be retained according to the applicable records retention schedule, which is five fiscal years from
the date of the audit report.
In FY 2020-2021, DMS was appropriated $175,000 in recurring funds for dependent eligibility verification
services. The bill may have a positive, indeterminate, fiscal impact on DMS due to avoided coverage costs of
ineligible dependents. See Fiscal Analysis & Economic Impact Statement.
The bill provides an effective date of upon becoming a law. STORAGE NAME: h1443b.SAT PAGE: 2
DATE: 2/14/2022
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Background
State Group Insurance Program
Overview
The State Group Insurance Program (SGI Program)
1
is administered by the Division of State Group
Insurance (DSGI) within the Department of Management Services (DMS). The SGI Program is an
optional benefit for state employees employed by state agencies, state universities, the court system,
and the Legislature. The SGI Program administers health, life, dental, vision, disability, and other
supplemental insurance benefits.
State Health Insurance Plans
The SGI Program provides four options for employees and retirees to choose as their health plan:
The standard Preferred Provider Organization (PPO) plan, administered by Florida Blue.
The high deductible PPO plan, administered by Florida Blue.
The standard health maintenance organization (HMO) services.
2
The high deductible HMO.
Pharmacy Benefit
The SGI Program also has a pharmacy benefit for members of the plan. The SGI Program covers all
federal legend drugs (open formulary) for covered medical conditions and employs very limited
utilization review and clinical review for traditional or specialty prescription drugs. The DMS contracts
with CVS/Caremark, a pharmacy benefits manager, to administer the Prescription Drug Plan.
3
Eligible Employees
The SGI Program is open to the following individuals:
All state officers;
All state employees paid from “salaries and benefits” appropriation categories, regardless of the
number of hours worked;
Retired state officers and state employees;
Surviving spouses of deceased state officers and state employees;
Certain terminated state officers and state employees; and
Certain state employees paid from “other-personal-services” (OPS) appropriation categories.
For OPS employees to be eligible to participate in the health insurance program, the employee must:
Be reasonably expected to work an average of at least 30 hours per week; and
1
S. 110.123, F.S.
2
These are provided by Aetna, AvMed, Capital Health Plan, and UnitedHealthcare. At least one of these HMO plans is offered in each
county in the State of Florida.
3
myBenefits, Prescription Drug Plan, https://www.mybenefits.myflorida.com/health/health_insurance_plans/prescription_drug_plan STORAGE NAME: h1443b.SAT PAGE: 3
DATE: 2/14/2022
Have worked an average of at least 30 hours per week during the person’s measurement period
(which is 12 consecutive months
4
of employment).
5
Dependent Eligibility
The SGI Program covers employees and retirees of state agencies and their eligible dependents.
An eligible dependent is defined as:
A current spouse to whom the member is legally married.
A biological child, child with a qualified medical support order, legally adopted child, or child
placed in the home for the purpose of adoption in accordance with applicable state and federal
laws, through the end of the calendar year in which he/she turns age 26.
A stepchild, for as long as the member remains legally married to the child’s parent, through the
end of the calendar year in which he/she turns age 26.
A foster child placed in the member’s home by the Department of Children and Families
Foster Care Program or the foster care program of a licensed private agency, through the end
of the calendar year in which he/she turns age 26.
A child for whom the member has legal guardianship through the end of the calendar year in
which he/she turns age 26.
An over-age dependent, after the end of the calendar year in which he/she turns 26, through the
end of the calendar year in which he/she turns 30 – if he/she is unmarried, has no dependents
of his/her own, is a resident of Florida or a full- or part-time student, and has no other health
insurance.
An over-age dependent with a disability.
A newborn dependent of a member’s covered child for up to 18 months of age as long as the
newborn’s parent remains covered.
A child of law enforcement, probation, or correctional officers who were killed in the line of duty,
who are attending a college or university beyond their 18th birthday.
A surviving spouse and dependents.
Dependents may be added as covered dependents during the open enrollment period each year or in
the event of a qualifying status change. Minimal information is collected by the DMS to determine
eligibility.
Dependent Eligibility Verification
During the 2017 Legislative Session, the DSGI was directed to contract with a vendor to verify the
eligibility of all dependents participating in the SGI Plan. The DSGI provided notice to all subscribers
and on July 1, 2020, via the People First Service Center, began requesting subscribers to provide
documents as part of the dependent eligibility verification process. The documents include tax
transcripts from the Internal Revenue Service, marriage licenses, birth certificates, adoption
documents, and other documents.
6
At the beginning of FY 2020-21, DMS received $175,000 to continue the statewide dependent eligibility
audit for newly added dependents on an on-going basis.
7
The on-going audit began on July 1, 2020,
and continues today. Additionally, DMS conducted a gap audit that began in August 2021 and includes
all covered dependents that were added after the original dependent eligibility audit in 2018, and prior
to the on-going audit in July 2020.
8
The gap audit is scheduled to conclude in May 2022.
9
4
S. 110.123(13)(d), F.S.
5
S. 110.123(2)(c)2., F.S.
6
S. 110.12301(2)(b), F.S.
7
Department of Management Services, 2022 Agency Legislative Bill Analysis – HB 1443, pg. 2 (2022).
8
Id.
9
Id. STORAGE NAME: h1443b.SAT PAGE: 4
DATE: 2/14/2022
Enrollment
For FY 2020-21, the final SGI Program enrollment reflected 175,046 subscribers and 187,244
dependents, totaling 362,290 covered lives.
10
Approximately 47.1% of subscribers are enrolled in PPO
plans, 52.3% are enrolled in HMO plans, and 0.6% are enrolled in a Medicare Advantage Prescription
Drug plan.
11
Subscriber enrollment in individual coverage was 47.8%, and 52.2% were enrolled in
family coverage, which had an average size of 3.05 members.
12
Effect of Proposed Changes
HB 1443 permits DMS, instead of DSGI, to provide or contract for dependent eligibility verification
services for the SGI Program on an ongoing basis.
Current law gives the contractor providing dependent eligibility verification services the authority to
request certain documents from subscribers to the SGI Program to conduct such verification. The bill
instead requires subscribers to submit the documents currently listed in s. 110.12301(2)(b), F.S., to
DMS or its contractor for dependent eligibility verification.
The bill repeals obsolete language from 2017 requiring DMS to competitively procure a contract for
dependent eligibility verification services for the SGI Program. The contract was procured, and the audit
was completed.
13
Lastly, the bill stipulates that all documentation submitted by subscribers for purposes of dependent
eligibility verification services for the SGI program must be retained according to the applicable records
retention schedule.
14
It removes reference to maintaining such records through June 30, 2019.
The bill provides an effective of upon becoming a law.
B. SECTION DIRECTORY:
Section 1: Amends s. 110.12301, F.S., relating to competitive procurement of postpayment claims
review services and dependent eligibility verification services; public records exemption.
Section 2: Provides an effective date of upon becoming a law.
10
State Employee’s Group Health Self-Insurance Trust Fund, Report on Financial Outlook, For the Fiscal Years Ending June 30, 2021
through June 30, 2026, http://edr.state.fl.us/content/conferences/healthinsurance/HealthInsuranceOutlook.pdf.
11
Id. at p. 1.
12
Id.
13
Supra, FN 7.
14
According the state’s General Records Schedule, documents and information received in conjunction with an internal audit must be
kept for five fiscal years following the audit report release date. Florida Department of State, Division of Library and Information
Services, General Records Schedule GS1-SL for State and Local Government Agencies, August 2020 (authorized by Rule 1B-
24.003(1)(a), F.A.C.). STORAGE NAME: h1443b.SAT PAGE: 5
DATE: 2/14/2022
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
The Legislature appropriated DMS $175,000 in recurring budget authority in the FY 2020-2021
General Appropriations Act for dependent eligibility verification services. DMS should have
sufficient budget authority for the purposes of performing eligibility verification audits. The bill may
have a positive fiscal impact on DMS and the DSGI by identifying dependents who do not qualify for
participation in SGI Program, excluding them from the Program, and avoiding costs associated with
covering ineligible dependents.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
None.
D. FISCAL COMMENTS:
None.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not applicable. The bill does not impact county or municipal governments.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
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DATE: 2/14/2022
The bill does not require additional rule-making authority to implement its provisions.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES
None.