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STATE OF OKLAHOMA
1st Session of the 59th Legislature (2023)
HOUSE BILL 1407 By: Culver
AS INTRODUCED
An Act relating to state employee benefits; amending
74 O.S. 2021, Section 1370 , which relates to flexible
benefits allowance; modifying benefit allowance for
state employees; and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 74 O.S. 2021, Section 1370, is
amended to read as follows:
Section 1370. A. Subject to the requirement that a participant
must elect the default benefits, the basic plan , or is a person who
has retired from a branch of the United States military and has been
provided with health care thr ough a federal plan, to the extent that
it is consistent with federal law, or is an active employee who is
eligible to participate and who is a participant who has opted out
of the state's basic plan according to the provisions of Section
1308.3 of this title, and provides proof of this cov erage, flexible
benefit dollars may be used to purchase any of the benefits offered
by the Oklahoma State Employees Benefits Coun cil under the flexible
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benefits plan. A participant who has opted out of the state 's basic
plan and provided proof of other co verage as described in this
subsection shall receive One Hundred Fifty Dollars ($150.00) in lieu
of the flexible benefit monthly. A participant's flexible benefit
dollars for a plan year shall consist of the sum of (1) f lexible
benefit allowance credited to a participant by the participating
employer, and (2) pay conversion dollars elected by a participant.
B. Each participant sha ll be credited annually wit h a specified
amount as a flexible benefit allowance which shall be available for
the purchase of benefits. For participants on a biweekly payroll
system the disbursement of the flexible benefit allowance shall be
credited over twenty-four pay periods res ulting in two pay periods
that do not reflect a credit. The amou nt of the flexible benefit
allowance credited to each participant shall be communicated to him
or her prior to the enrollment period for each plan year.
C. Except as provided in subsection D of this section, for the
plan year beginning January 1, 2013, th e benefit allowance shall not
be less than the Plan Year 2012 benefit allowance amounts, and each
plan year thereafter, the amount of a participant 's benefit
allowance, which shall be the tot al amount the employer contributes
for the payment of insurance p remiums or other benefits, shall be :
1. The greater of the amount of benefit which the participant
would have qualified for as of plan year 2021, or an amount equal to
the monthly premium of the HealthChoice High Option plan, the
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average monthly premiums of the dental plans, the monthly pr emium of
the disability plan, and the monthly premium of th e basic life
insurance plan offered to state employees or the amo unt determined
by the Council based on a formula for determining a participant 's
benefit credits consistent with the requirements of 26 U.S.C.,
Section 125(g)(2) and regulations thereunder;
2. The greater of the amount of benefit which the participant
would have qualified for as of plan year 2021 or an amount equal to
the monthly premium of the Healt hChoice High Option plan, the
average monthly premiums of the dental plans, the monthly premiu m of
the disability plan, and the monthly premium of the basic life
insurance plan offered to state employees plus one of the additional
amounts as follows for pa rticipants who elect to include one or more
dependents:
a. for a spouse, seventy-five percent (75%) of the
HealthChoice High Option plan, available for coverage
of a spouse,
b. for one child, seventy-five percent (75%) of the
HealthChoice High Option plan, for coverage of one
child,
c. for two or more children, seventy-five percent (75%)
of the HealthChoice High Option plan, for coverage of
two or more children,
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d. for a spouse and one child, seventy-five percent (75%)
of the HealthChoice High Option plan, for coverage of
a spouse and one child, or
e. for a spouse and two or more children, seventy -five
percent (75%) of the HealthChoice High Option plan,
for coverage of a spouse and two or more children;
3. For the plan year beginning January 1, 2022, the am ount of a
participant's benefit allowance shall be increased by two percent
(2%) from the amount provided in the previous year;
4. For the plan year be ginning January 1, 2023, t he amount of a
participant's benefit allowance shall be increased by two perce nt
(2%) from the amount provided in the previous year; or
5. For the plan year beginning Janu ary 1, 2024, the amount of a
participant's benefit allowance shall be increased by two percent
(2%) from the amount provided in the previous year;
6. For the plan year be ginning January 1, 202 5, the amount of a
participant's benefit allowance shall be inc reased by two percent
(2%) from the amount provided in the previous year; or
7. The greater of the amount of benefit which the participant
would have qualified for as of pla n year 2023 2025, or an amount
equal to the monthly premium of the HealthChoice High Option plan,
the average monthly premiums of the dental plans, the monthly
premium of the disability plan and the monthly premium of the basic
life insurance plan offered to s tate employees plus one of the
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additional amounts as follows for participant s who elect to include
one or more dependents:
a. for a spouse, seventy-five percent (75%) of the
HealthChoice High Option plan, available for coverage
of a spouse,
b. for one child, seventy-five percent (75%) of the
HealthChoice High Option plan, for cove rage of one
child,
c. for two or more children, sev enty-five percent (75%)
of the HealthChoice High Option plan, for coverage of
two or more children,
d. for a spouse and one child , seventy-five percent (75%)
of the HealthChoice High Option plan, for cover age of
a spouse and one child, or
e. for a spouse and two or more children, seventy-five
percent (75%) of the HealthChoice High Option plan,
for coverage of a spouse and two or mor e children.
D. To the extent that it is consistent with federal laws and
regulations, and in particul ar the regulations set forth by the
Secretary of Defense in 32 C.F.R. Section 199.8(d)(6), a benefit may
be provided to an employee who is an eligible TRI CARE beneficiary
whereby he or she may purchase a group TRICARE Supplemental product
under a qualifying cafeteria plan consi stent with the requirements
of 26 U.S.C., Section 125, provided that:
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1. The state, as employer , may not provide any payment for nor
receive any consideration or compensation for offering the benefit;
2. The employer's only involvement is in providing the
administrative support for the benefit under the cafeteria plan; and
3. The employee's participation in the plan is completely
voluntary.
The benefit allowance under paragraph 2 of subsection C of this
section of an employee whose plan participation includes a group
TRICARE Supplemental benefit shall not include any allowance or
portion thereof for such TRICARE Supplemental benefit.
E. This section shall not prohibit payments for supplemental
health insurance coverage made pursuant to Section 1314.4 of this
title or payments for the cost of providing health insurance
coverage for dependents of employees of the Grand River Dam
Authority.
F. If a participant desires to buy benefits whose sum total of
benefit prices is in excess of hi s or her flexible benefit
allowance, the participant may elect to use pay conversion dollars
to purchase such excess benefits. Pay conversion dollars may be
elected through a salary reduction agreement made pursuant to the
election procedures of Section 1 371 of this title. The elected
amount shall be deducted from the participant's compensation in
equal amounts each pay period, with the exception of partic ipants on
a biweekly payroll system, where such deduction shall occur over
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twenty-four pay periods over the plan year. On termination of
employment during a plan year, a participant shall have no
obligation to pay the participating employer any pay conver sion
dollars allocated to the portion of the plan year after the
participant's termination of employm ent.
G. If a participant elects benefits whose sum total of benefit
prices is less than his or her flexible benefit allowance, he or she
shall receive any excess flexible benefit allowance as taxable
compensation. Such taxable c ompensation will be paid i n
substantially equal amounts each pay period, with the exception of
participants on a biweekly payroll system, where such deduction
shall occur over twent y-four pay periods over the plan year. On
termination during a plan year, a participant shall have n o right to
receive any such taxable cash compensation allocated to the portion
of the plan year after the participant 's termination. Nothing
herein shall affect a participant's obligation to elect the minimum
benefits or to accep t the default benefits of the plan with
corresponding reduction in the sum of his or her flexible benefit
allowance equal to the sum total benefit price of such minimum
benefits or default benefits.
SECTION 2. This act shall become effec tive November 1, 2023.
59-1-5244 TJ 11/17/22