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SENATE FLOOR VERSION
April 2, 2024
ENGROSSED HOUSE
BILL NO. 3586 By: Strom of the House
and
Garvin of the Senate
An Act relating to state employee health insurance;
amending 70 O.S. 2021, Section 14 -108.1, which
relates to health insurance pla n for employees;
modifying references to entity names; amending 70
O.S. 2021, Section 26 -104, which relates to funding
to provide flexible benefit allowance; modifying
references to entity names; amending 70 O.S. 2021,
Section 26-105, which relates to use of flexible
benefit allowance; modifying references to entity
names; amending 74 O.S. 2021, Section 85.58A, which
relates to establishment of comprehensive
professional risk management program; modifying
references to entity names; amending 74 O.S. 2021,
Section 1316.2, which relates to continuance of
health and dental insurance benefits; modifying
citations; amending 74 O.S. 2021, Section 1321, which
relates to determination of rates and benefits;
modifying references to entity names; amending 74
O.S. 2021, Section 1332, which relates to
establishment of disability insurance program for
state employees; modifying references to en tity names
and updating citations; amending 74 O.S. 2021,
Section 1332.1, which relates to collections from
state agencies; modify ing references to entity names;
amending 74 O.S. 2021, Section 1346, which relates to
creation of flexible benefit revolving fund;
modifying references to entity names; amending 74
O.S. 2021, Section 1370, which relates to flexible
benefit dollars in the O klahoma State Employees
Benefits Act; modifying references to entity names;
repealing 74 O.S. 2021, Section 1329.1, which rela tes
to mutual accountability incentive pilot program;
repealing 74 O.S. 2021, Sections 1381, 1382, 1383,
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and 1384, which relate to the Wellness Program Act;
and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 70 O.S. 2021, Section 14 -108.1, is
amended to read as follows:
Section 14-108.1 A. The board of education of each technology
center school district in this state shall provide a health
insurance plan for the employees of the technology center school
district. Technology center school districts may obtain health and
dental insurance coverage as provided for in the State and Education
Employees Group Insurance Oklahoma Employees Insurance and Benefits
Act or may obtain other health insurance coverage. Any technology
center district that does not participate in the health and dental
insurance plans offered through the State and Education Employees
Group Insurance Oklahoma Employees Insurance and Benefits Act shall
obtain health insurance coverage for the employees which provides
open enrollment, and provide for the continuation of health
insurance coverage, including supplemental Medicare insurance
coverage, for those district employees who retire from said district
after September 30, 1991, with a vested benefit in the Teachers'
Retirement System of Oklahoma. A retired person who begins
receiving benefits from the Teachers' Retirement System of Oklahoma
after September 30, 1991, who retires from a technology center
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school district that provides other health insurance coverage, and
who elects to continue said health insurance coverage shall pay t o
the technology center school district the premium rate fo r the
health insurance minus an amount equal to the premium rate of the
Medicare supplement or the amount determined pursuant to subsection
(4) of Section 1316.3 of Title 74 of the Oklahoma Statute s,
whichever is less, which shall be paid by the Teachers' Retirement
System of Oklahoma to the technology center school district. The
technology center school district shall remit to the health
insurance coverage provider the total premium due less any
uncollected amounts payable from retired technology center s chool
district employees or their qualified survivors.
B. A technology center school district that participates in
health insurance coverage other than the health insurance plan
offered by the State and Education Employees Group Insurance
Oklahoma Employees Insurance and Benefits Act shall not be required
to pay any portion of the premium for the employees or the
dependents of the employees of said school district. Unless a
school district negotia tes an agreement with its employees regarding
health insurance pursuant to Sections 509.1 through 509.9 of this
title, and to the extent that the agreement provides for the members
of the recognized bargaining unit, a technology center school
district that participates in health insurance coverage other than
the health insurance plan offered by the State and Education
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Employees Group Insurance Oklahoma Employees Insurance and Benefits
Act is prohibited from acquiring additional or supplemental health
or dental insurance for any board member, superintendent or any
other employee which is not available to all employees of said
district, and said technology center school district shall not pay a
greater portion of the employee or dependent premium for any healt h
or dental insurance plan or plans provided by said technology center
school district on behalf of any board member, superintendent or
employee than that portion paid on behalf of all participating
employees of said district.
C. If a technology center sc hool district obtains health
insurance coverage from a sour ce other than through the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Act, the employees of the technology center school district
who would be eligible t o participate in the health and dental plans
may require the board of education of the technology center school
district to call an election to allow said employees to vote as to
whether the technology center school district shall participate in
the health and dental insurance plans offered through the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Act. Upon the filing with the board of education of a
petition calling for such an election which is signed by no less
than thirty percent (30%) of the eligible employees of the
technology center school district, the board of education shall call
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an election for the purpose of determining whether the technology
center school district shall participate in the health and den tal
insurance plans offered through the State and Education Employees
Group Insurance Oklahoma Employees Insurance and Benefits Act. The
election shall be held within thirty (30) days of the filing of the
petition. If a majority of those eligible employe es voting at the
election vote to participate in the health and dental insurance
plans offered through the State and Education Employees Group
Insurance Oklahoma Employees Insurance and Benefits Act, the board
of education of the technology center school d istrict shall apply
for such participation within thirty (3 0) days of the election.
D. If a technology center school district does not have any
health insurance coverage of the type required by this section, that
technology center school district shall im mediately be enrolled in
the health and dental insurance plans offered through the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Act.
E. A carrier providing health insurance coverage for employees
of a technology center school district health insurance group which
replaces a previous carrier for such technology center school
district employees shall provide coverage for each retired employee
who is receiving a benefit or terminates employment with a vested
benefit from the Teachers' Retirement System of Oklahoma and who is
enrolled in the health insurance group by the previous carrier at
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the time the previous carrier providing health insurance coverage is
replaced. Notwithstanding any provision in this section to t he
contrary, any person who retires pursuant to the provisi ons of the
Teachers' Retirement System of Oklahoma prior to May 1, 1993, or
terminates service with a vested benefit, pursuant to the provisions
of the Teachers' Retirement System of Oklahoma prior to May 1, 1993,
may continue to participate in the health and dental plans
authorized by the provisions of the State and Education Employees
Group Insurance Oklahoma Employees Insurance and Benefits Act.
F. In the event a technology center school distric t ceases to
exist, the assets and duties of said technology center school
district are transferred to one or more other technology center
school districts, said other technology center school district or
districts do not agree to employ all of the former e mployees of the
technology center school district that is ceasing to exist, and said
former employees who are not being reemployed have rights under
federal or state law to continue group insurance coverage, the
annexing technology center school district h aving the largest
general fund revenue for the most recent preceding fiscal year for
which data is available shall provide group insurance coverage to
said former employees not being retained during the period as
required by law.
SECTION 2. AMENDATORY 70 O.S. 2021, Section 26 -104, is
amended to read as follows:
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Section 26-104. A. Each fiscal year, the Legislature shall
appropriate adequate funding to the State Board of Education and the
State Board of Career and Technology Educat ion for the purpose of
providing a flexible benefit allowan ce to school district employees
pursuant to this act. Unless the Legislature appropriates adequate
funding specifically for the purpose of providing a flexible benefit
allowance to school district employees, the Oklahoma State Board of
Education shall allocate from the funds appropriated to the Oklahoma
State Board of Education for the support of public school activities
an amount to fully fund the flexible benefit allowance, which shall
occur first prior to allocating the funds for any other purpose.
The amount appropriated for funding and disbursed to school
districts shall be calculated by multiplying the number of eligible
school district employees employed by school districts which are
participating in the health insurance plan offered by the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Board or are self-insured as counted in February of each
year by the amount of the flexible benefit allowance credite d to the
eligible school employees as established in Sectio n 26-105 of this
title. Each Board shall disburse the total amount appropriated for
funding the flexible benefit allowance to school districts during
the fiscal year. From the total amount approp riated, each Board
shall disburse the appropriate amounts, based on the number of
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eligible school district employees employed by that school district,
to each school district.
B. Every school district shall establish or make available to
school district employees a cafeteria plan pursuant to 26 U.S.C.
Section 125 of the United States Code. The plan shall offer, as a
benefit, major medical health care plan coverage.
C. The flexible benefit allowance amount established pursuant
to Section 26-105 of this title shall be credited to each eligible
school district employee. School district employees shall elect
whether to use the flexible benefit allowance to pay for coverage in
the health insurance plan offered by the State and Education
Employees Group Insura nce Oklahoma Employees Insurance and Benefits
Board or the self-insured plan offered by the school district and
may receive the excess flexible benefit allowance as taxable
compensation as provided in Section 26 -105 of this title.
D. The administrator of the cafeteria plan shall maintain a
separate account for each participating school district employee.
School districts shall forward the school district employee flexible
benefit allowance amounts to the administrator for elected purchases
of cafeteria plan benefits.
E. Expenses included in an employee's salary adjustment
agreement pursuant to the cafeteria plan shall be limited to
expenses for:
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1. Premiums for any health insurance, health maintenance
organization, life insurance, long term disability in surance, dental
insurance or high deductible health benefit plan offered to
employees and their dependents; and
2. All other eligible benefit programs offered under 26 U.S.C.
Section 125 of the United States Code.
F. The flexible benefit allowance amount established in Section
26-105 of this title shall not be i ncluded as income in computation
of state retirement contributions and benefits or as part of the
Minimum Salary Schedule for teachers established in Section 18 -
114.12 of this title. School distri cts shall not consider the
flexible benefit allowance amount as income for eligible support
employees and thereby shall not reduce the salary of an eligible
support employee.
SECTION 3. AMENDATORY 70 O.S. 2021, Section 26 -105, is
amended to read as follows:
Section 26-105. A. The flexible benefit allowance shall be
used by a school district employee who is participating in the
cafeteria plan to purchase major medical health care plan coverage
offered by the school district throug h a cafeteria plan. Any excess
flexible benefit allowance over the cost of the major medical
coverage purchased by the employee who is participating in the
cafeteria plan may be used to purchase any of the additional
benefits offered by the school distric t or may be taken as taxable
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compensation as provided in su bsection C of this section. Certified
personnel who choose not to participate in the school -district-
sponsored cafeteria plan shall receive Sixty -nine Dollars and
seventy-one cents ($69.71) per mo nth as taxable compensation in lieu
of the flexible benefit allowance amount provided in subsection B of
this section. Support personnel who choose not to participate in
the school-district-sponsored cafeteria plan shall receive One
Hundred Eighty-nine Dollars and sixty-nine cents ($189.69) per month
as taxable compensation in lieu of the flexible benefit allowance
amount provided in subsection B of this section.
B. Each eligible school district employee shall be credited
annually with a specified amount as a flexible benefit allowance
which shall be available for the purchase of benefits. The amount
of the flexible benefit allowance credited to each eligible school
district employee shall be communicated to the employee prior to the
enrollment period for each plan year.
1. For the fiscal year ending June 30, 20 02, the flexible
benefit allowance amount for certified personnel shall be no less
than Sixty-nine Dollars and seventy -one cents ($69.71) per month.
For the fiscal year ending June 30, 2002, the f lexible benefit
allowance amount for support personnel shall be no less than One
Hundred Eighty-nine Dollars and sixty -nine cents ($189.69) per
month.
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2. For the fiscal year ending June 30, 2004, the flexible
benefit allowance amount for certified personn el shall be no less
than fifty-eight percent (58%) of the p remium amount for the
HealthChoice (Hi) option plan for an individual offered by the State
and Education Employees Group Insurance Oklahoma Employees Insurance
and Benefits Board. For the fiscal y ear ending June 30, 2003, and
each fiscal year thereafter, the flexible benefit allowance amount
for support personnel shall be no less than one hundred percent
(100%) of the premium amount for the HealthChoice (Hi) option plan
for an individual offered by the State and Education Employees Group
Insurance Oklahoma Employees Insurance and Benefits Board.
3. For the fiscal year ending June 30, 2005, and each fiscal
year thereafter, the flexible benefit allowance amount for certified
personnel shall be no les s than one hundred percent (100%) of the
premium amount for the HealthChoice (Hi) option plan for an
individual offered by the State and Education Employees Group
Insurance Oklahoma Employees Insurance and Benefits Board.
C. If a school district employee who is participating in the
cafeteria plan elects benefits whose sum total is less than the
flexible benefit allowance, the employee shall receive any excess
flexible benefit allowance as taxable compensation. Such taxable
compensation shall be paid in su bstantially equal amounts each pay
period over the plan year. Except as otherwise provided for in
subsection D of this section, on termination during a plan year, a
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participating school district employee shall have no right to
receive any taxable cash com pensation allocated to the portion of
the plan year after t he termination of the employee.
D. In cases where the employee of a school district fulfills
the terms of their contract and terminates employment for the
subsequent year, the employee shall be en titled to the flexible
benefit allowance for the remainder of the current benefit term.
For purposes of this subsection, "benefit term" shall mean the
twelve-month period after the initiation of benefits for the
position held by the employee.
E. Each school district employee shall make an annual election
of benefits under the plan during an enrollment period to be held
prior to the beginning of each plan year. The enrollment period
dates will be determined annually and will be announced by the
school district, providing the enrollment period shall end no later
than thirty (30) days before the beginning of the plan year. Each
school district employee shall make an irrevocable advance election
for the plan year or the remainder of the plan year pursuant to
procedures the school district shall prescribe.
F. The school district shall prescribe the forms that school
district employees shall be required to use in making their
elections, and may prescribe deadlines and other procedures for
filing the elections.
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G. School district employees hired after the closing of the
enrollment period shall be allowed to make an election as provided
in this act.
H. A district board of education shall have the option of
providing a flexible benefit allowance to the superinte ndent of the
school district in an amount not more than the amount of the
flexible benefit allowance established for certified personnel in
subsection B of this section. Funding for the flexible benefit
allowance for a superintendent shall be provided thr ough local
revenue.
SECTION 4. AMENDATORY 74 O.S. 2021, Section 85.58A, is
amended to read as follows:
Section 85.58A A. The Office of Management and Enterprise
Services (OMES) shall establish for all state agencies, whether or
not subject to the Oklahoma Central Purchasing Act, and oth er
entities as provided by law a comprehensive professional risk
management program which shall:
1. Identify and evaluate risks of loss and exposures to loss to
officers, employees and properties;
2. Minimize risks through loss -prevention and loss-control
programs;
3. Transfer risks, if economically advantageous to the state,
by acquiring commercial insurance, contractual pass through of
liability, or by other means;
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4. Consolidate and administe r risk management plans and
programs including self -insurance programs, except State Employees
Group Insurance;
5. Determine feasibility of and, if feasible, establish self -
insurance programs, considering whether a program may be self -
supporting to remain financially and actuarially sound;
6. Provide a system to allocate insurance and program costs to
determine payment for insurance coverage and program expenses
provided by the Office of Management and Enterprise Services;
7. When requested by a state re tirement system or the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Board, assist in obtaining insurance authorized by law. If
requested by the Oklahoma State Regents for Higher Education, assist
trust funds for which the State Regents serve as trustees in
obtaining insurance authorized by law;
8. Assist state agencies and officers, employees, and members
thereof, charged with licensing authority, in obtaining insurance
for liability for judgments, based on the l icensing authority,
rendered by any court pursuant to feder al law;
9. When requested by a public trust established pursuant to
Title 60 of the Oklahoma Statutes of which the State of Oklahoma is
the beneficiary, obtain, provide or assist the public trust in
obtaining insurance authorized by law or trust indenture covering
any board member, trustee, official, officer, employee or volunteer
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for errors and omissions or liability risks arising from the
performance of official duties pursuant to law or trust in denture;
10. When requested by the Oklahoma State Regents for Higher
Education, for the purpose of insuring real property required
pursuant to Section 4018 of Title 70 of the Oklahoma Statutes, of
which the Oklahoma State Regents for Higher Education is t he
beneficiary, obtain, provide or assist the Oklahoma State Regents
for Higher Education in obtaining insurance for the real property
pursuant to the provisions of this section; and
11. Authorize the Risk Management Administrator to declare an
emergency for the purpose of mitigating damages to any state -owned
property insured under the comprehensive professional risk
management program administered by OMES.
B. The Director of the Office of Management and Enterprise
Services may hire or contract for the s ervices of a Risk Management
Administrator to supervise the Comprehensive Professional Risk
Management Program established pursuant to this section. If
appointed by the Director as a state employee, the Risk Management
Administrator shall be in the unclas sified service.
C. The Risk Management Administrator shall evaluate insurance
coverage needs and in force for state agencies, whether or not
subject to the Oklahoma Central Purchasing Act, and other entities
as provided by law. All entities shall submit to the Risk
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Management Administrator all information which the Risk Management
Administrator deems necessary to perform this duty.
D. The Risk Management Administrator in conjunction with the
State Purchasing Director under the authority of the Director o f the
Office of Management and Enterprise Services may nego tiate insurance
coverage and insurance -related services including, but not limited
to, insurance brokerage and consulting services. The State
Purchasing Director shall ensure open processes for so licitation and
qualification of insurance coverage and services providers. The
State Purchasing Director shall award contracts for insurance
coverage and services to the provider or providers which offer the
best and final terms and conditions. The State Purchasing Director
may authorize the Risk Management Admi nistrator to bind for
insurance coverage with providers.
E. The school districts of this state may request the Risk
Management Administrator to advise for the purchase of insurance
coverage for the school districts.
F. A state agency, whether or not subject to the Oklahoma
Central Purchasing Act, that contemplates purchase of property and
casualty insurance, shall provide details of the proposed purchase
to the Risk Management Administrator for ap proval or disapproval
prior to the purchase.
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G. The Director of the Office of Management and Enterprise
Services shall promulgate rules to effect the provisions of the
comprehensive professional risk management program.
H. 1. a. Any community action agen cy established pursuant to
Sections 5035 through 5040 of this title may
participate in the comprehensive professional risk
management program established pursuant to this
section for risks incurred as a result of operating a
Head Start program or providing transportation
services to the public. The Risk Managemen t
Administrator shall obtain or provide for insurance
coverage for such community action agencies or bonding
for employees of such community action agencies. Any
liability insurance coverage obtai ned or provided
shall include expenses for administrative and legal
services obtained or provided by the Risk Management
Administrator.
b. The Risk Management Administrator shall determine
criteria for participation in the risk management
program by such community action agencies. In
addition, the Risk Management Administrator may
require each such community action agency to:
(1) provide adequate qualified personnel and suitable
facilities and equipment for operating a Head
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Start program or providing trans portation
services to the public, and
(2) comply with such standards as are necessary for
the protection of the clients it serves.
2. To receive coverage pursuant to this section, a community
action agency shall make payments for any insurance coverage an d
shall otherwise comply with the provisions of this sectio n and rules
promulgated by the Office pursuant to the provisions of this
section.
3. Requests for the insurance coverage provided pursuant to the
provisions of this subsection shall be submitted i n writing to the
Risk Management Administrator by the community action agencies.
I. The Risk Management Administrator may provide or obtain for
any state agency, public trust with the state as a beneficiary and a
director, officer, employee or member ther eof, insurance for
liability for loss, including judgments, awards, settlements, costs
and legal expenses, resulting from violations of rights or
privileges secured by the Constitution or laws of the United States
of America which occur while a director, o fficer, employee or member
is acting within the scope of service to the State of Oklahoma. The
insurance shall be for coverage in excess of the limits on liability
established by The Governmental Tort Claims Act but shall not limit
or waive any immunities now or hereafter available to the State of
Oklahoma or any state agency, any public trust with the state as a
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beneficiary, or any director, officer, employee or member thereof
including, but not limited to, any immunities under the Eleventh
Amendment to the Constitution of the United States, state sovereign
immunity, and any absolute or qualified immunity held by any
director, officer, employee or member.
SECTION 5. AMENDATORY 74 O.S. 2021, Section 1316.2, is
amended to read as fo llows:
Section 1316.2 A. Any employee, other than an educ ation
employee, who retires pursuant to the provisions of the Oklahoma
Public Employees Retirement System or who has a vested benefit
pursuant to the provisions of the Oklahoma Public Employees
Retirement System may continue in force the health and dental
insurance benefits authorized by the provisions of the Oklahoma
Employees Insurance and Benefits Act, or other employer insurance
benefits if the employer does not participate in the plans offered
by the Office of Management and Enterprise Services, if suc h
election to continue in force is made within thirty (30) days from
the date of termination of service. Except as otherwise provided
for in Section 840-2.27I of this title and subsection H of this
section, health and dental insurance coverage may not be reinstated
at a later time if the election to continue in force is declined.
Vested employees other than education employees who have terminated
service and are not receiving benefits and effectiv e July 1, 1996,
nonvested persons who have terminated servi ce with more than eight
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(8) years of participating service with a participating employer,
who within thirty (30) days from the date of termination of service
elect to continue such coverage, shall pay the full cost of the
insurance premium at the rate and pursuant to the terms and
conditions established by the Office. Provided also, any employee
other than an education employee who commences employment with a
participating employer on or after Sept ember 1, 1991, who terminates
service with such employer on or after July 1, 1996, but who
otherwise has insufficient years of service to retire or terminate
service with a vested benefit pursuant to the provisions of the
Oklahoma Public Employees Retireme nt System or to elect to continue
coverage as a nonvested employee as provided in this section, but
who, immediately prior to employment with the participating
employer, was covered as a dependent on the health and dental
insurance policy of a spouse who w as an active employee other than
an education employee, may count as part of his or her credited
service for the purpose of determining eligibility to elect to
continue coverage under this section, the time during which the
terminating employee was covered as such a dependent.
B. 1. Health insurance benefit plans offered pursuant to this
section shall include:
a. indemnity plans offered through the Office,
b. managed care plans offered as alternatives to the
indemnity plans offered through the Office,
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c. Medicare supplements offered pursuant to the Oklahoma
Employees Insurance and Benefits Act,
d. Medicare risk-sharing contracts offered as
alternatives to the Medicare supplements offered
through the Office. All Medicare risk -sharing
contracts shall be sub ject to a risk adjustment
factor, based on generally accepted actuarial
principles for adverse selection which may occur, and
e. for the Oklahoma Public Employees Retirement System,
other employer-provided health insurance benefit plans
if the employer does not participate in the plans
offered pursuant to the Okla homa Employees Insurance
and Benefits Act.
2. Health insurance benefit plans offered pursuant to this
section shall provide prescription drug benefits, except for plans
designed pursuant to the Me dicare Prescription Drug Improvement and
Modernization Act of 2003, pursuant to 42 USCA Section 1395w -101, et
seq., for which provision of prescription drug benefits is optional,
and except for plans offered pursuant to subparagraph e of paragraph
1 of this subsection.
C. 1. Designated public retirement systems shall contribute a
monthly amount towards the health insurance premium of certain
individuals receiving benefits from the public retirement system as
follows:
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a. a retired employee, other than an e ducation employee
or an employee who participates in the defined
contribution system administered by the Oklahoma
Public Employees Retirement System on or after
November 1, 2015, who is receiving benefits from the
Oklahoma Public Employees Retirement Syste m after
September 30, 1988, shall have One Hundred Five
Dollars ($105.00), or the premium rate of the health
insurance benefit plan, whichever is less, paid by the
Oklahoma Public Employees Retirement System to the
Board or to another insurance carrier or other
qualified benefits administrator of the employer if
the employer does not participate in the plans offered
by the Office in the manner specified in subsection G
of this section,
b. a retired employee or surviving spouse other than an
education employee who is receiving benefits from the
Oklahoma Law Enforcem ent Retirement System after
September 30, 1988, is under sixty -five (65) years of
age and is not otherwise eligible for Medicare shall
have the premium rate for the health insurance benefit
plan or One Hundred Five Dollars ($105.00), whichever
is less, paid by the Oklahoma Law Enforcement
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Retirement System to the Office in the manner
specified in subsection G of this section,
c. a retired employee other than an education employee
who is receiving benefits from the Oklahoma Law
Enforcement Retirement System after September 30,
1988, is sixty-five (65) years of age or older or who
is under sixty-five (65) years of age and is eligible
for Medicare shall have One Hundred Five Dollars
($105.00), or the pr emium rate of the health insurance
benefit plan, whichever is less, paid by the Oklahoma
Law Enforcement Retirement System to the Office in the
manner specified in subsection G of this section, and
d. a retired employee other than an education employee
who is receiving benefits from the Uniform Retirement
System for Justices and Judges after September 30,
1988, shall have One Hundred Five Dollars ($105.00),
or the premium rate of the health insurance plan,
whichever is less, paid by the Uniform Retirement
System for Justices and Judges to the Office in the
manner specified in subsection G of this section.
2. Premium payments made pursuant to this section shall be made
subject to the following conditions:
a. the health plan shall be authorized by the provisi ons
of the Oklahoma Employees Insurance and Benefits Act,
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except that if an employer from which an employee
retired or with a vested benefit pursuant to the
provisions of the Oklahoma Public Employees Retirement
System does not participate in the plans aut horized by
the provisions of the Oklahoma Employees Insurance and
Benefits Act, the health plan will be the health
insurance benefits of the employer from which the
individual retired or vested,
b. for plans offered by the Oklahoma Employees Insurance
and Benefits Act, the amount to be paid shall be
determined pursuant to the provisions of this
subsection and shall first be applied in whole or in
part to the prescription drug coverage premium. Any
remaining amount shall be applied toward the medical
coverage premium,
c. for all plans, if the amount paid by the public
retirement system does not cover the full cost of the
elected coverage, the individual shall pay the
remaining premium amount, and
d. payment shall be made by the retirement systems in the
manner specified under subsection G of this section.
D. For any member of the Oklahoma Law Enforcement Retirement
System killed in the line of duty, whether the member was killed in
the line of duty prior to May 18, 2005, or on or after May 18, 2005,
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or if the member was on a disability leave status at the time of
death, the surviving spouse or dependents of such deceased member of
the Oklahoma Law Enforcement Retirement System may elect to continue
or commence health and dental insurance benefits, provided th e
dependents pay the full cost of such insurance, and for d eaths
occurring on or after July 1, 2002, such election is made within
thirty (30) days of the date of death. The eligibility for the
benefits shall terminate for the surviving children when the
children cease to qualify as dependents.
E. Effective July 1, 2004, a retired member of the Oklahoma Law
Enforcement Retirement System who retired from the System by means
of a personal and traumatic injury of a catastrophic nature and in
the line of duty and any surviving spouse of such retired member and
any surviving spouse of a member who was killed in the line of duty
shall have one hundred percent (100%) of the retired member's or
surviving spouse's health care premium cost, whether the member or
surviving spouse elects coverage under the Medicare supplement or
Medicare risk-sharing contract, paid by the Oklahoma Law Enforcement
Retirement System to the Office in the manner specified in
subsection H of this section. For plans offered by the Office, su ch
contributions will first be applied in whole or in part to the
prescription drug coverage premium, if any.
F. Dependents of a deceased employee who was on active work
status or on a disability leave at the time of death or of a
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participating retardant or of any person who has elected to receive
a vested benefit under the Oklahoma Public Employees Retirement
System, the Uniform Retirement System for Justices and Judges or the
Oklahoma Law Enforcement Retirement System may continue the health
and dental insurance benefits in force, provided the dependents pay
the full cost of such insurance and they were covered as eligible
dependents at the time of such death and such election is made
within thirty (30) days of date of death. The eligibility for the
benefits shall terminate for the surviving children when the
children cease to qualify as dependents.
G. The amounts required to be paid by the Oklahoma Public
Employees Retirement System, the Uniform Retirement System for
Justices and Judges and the Oklahoma Law Enforcement Retirement
System pursuant to this section shall be forwarded no later than the
tenth day of each month following the month for which payment is due
by the Oklahoma Public Employees Retirement System Board of Trustees
or the Oklahoma Law E nforcement Retirement Board to the Office for
deposit in the Health, Dental and Life Insurance Reserve Fund or to
another insurance carrier or other administrator of qualified
benefits of the employer as provided for in subsection H of Section
1315 of this title.
H. Upon retirement from employment of the Board of Regents of
the University of Oklahoma, any person who was or is employed at the
George Nigh Rehabilitation Institute and who transferred employment
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pursuant to Section 3427 of Title 70 of the Okla homa Statutes, any
person who was employed at the Medical Technology and Research
Authority and who transferred employment pursuant to Section 7068 of
this title and any person who is a member of the Oklahoma Law
Enforcement Retirement System pursuant to t he authority of Section
2-314 of Title 47 of the Oklahoma S tatutes may participate in the
benefits authorized by the provisions of the Oklahoma Employees
Insurance and Benefits Act for retired participants including
health, dental and life insurance benefi ts, if such election to
participate is made within thirty (30) days from the date of
termination of service. Life insurance benefits for any such person
who transferred employment shall not exceed the coverage the person
had at the time of such transfer. Retirees who transferred
employment and who participate pu rsuant to this paragraph shall pay
the premium for elected benefits less any amounts paid by a state
retirement system pursuant to this section.
SECTION 6. AMENDATORY 74 O .S. 2021, Section 1321, is
amended to read as follows:
Section 1321. A. The Office of Management and Enterprise
Services shall have the authority to determine all rates and life,
dental and health benefits. All rates shall be compiled in a
comprehensive Schedule of Benefits. The Schedule of Benefits shall
be available for inspection during regular business hours at the
Office of Management and Enterprise Services. The Office shall have
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the authority to annually adjust the rates and benefits based on
claim experience.
B. The premiums for such insurance plans offered for the next
plan year shall be established as follows:
1. For active employees and their dependents, the Office's
premium determination shall be made no later than the bid submission
date for health maintenance organizations set by the Oklahoma State
Employees Benefits Council Oklahoma Employees Insurance and Benefits
Board, which shall be set in August no later than the third Friday
of that month; and
2. For all other covered members and dependents, the Office's
and the health maintenance organizations' premium determinations
shall be no later than the fourth Friday of September.
C. The Office may approve a mid -year adjustment provided the
need for an adjustment is substantiated by an act uarial
determination or more current experience rating. Th e only
publication or notice requirements that shall apply to the Schedule
of Benefits shall be those requirements provided in the Oklahoma
Open Meeting Act. It is the intent of the Legislature th at the
benefits provided not include cosmetic dental procedures except for
certain orthodontic procedures as adopted by the Director.
SECTION 7. AMENDATORY 74 O.S. 2021, Section 1332, is
amended to read as follows:
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Section 1332. A. The State and Education Employees Group
Insurance Oklahoma Employees Insurance and Benefits Board shall
establish a Disability Insurance Program for state employees. The
program shall consist of a long -term disability plan and a short -
term disability plan. Participation in the program shall be limited
to state employees who have been state employees for a period of not
less than one (1) month and who are eligible for enrollment in the
Health Insurance Plan administered by the Board. No state employee
shall be eligible to receive any benefits from the long -term
disability program unless the state employee has used all of the
sick leave of the employee. The Board shall promulgate such rules
as are necessary for adoption and administration of the Disabi lity
Insurance Program, including but not limited to benefit eligibility
requirements, methods for computing benefit amounts, benefits
amounts, and verification of medical and health status of employees
applying for or receiving benefits.
B. The Disability Insurance Program shall be funded from
appropriations made by the Legislature. Employees shall not be
required to make contributions to participate in the program.
C. Employee disability insurance coverage shall begin on March
1, 1986.
D. The Board shall establish a grievance procedure by which a
three-member grievance panel established in the same manner as
specified in paragraph 6 of Section 1306 Section 1304.1 of this
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title shall act as an appeals body for complaints regarding the
allowance and payment of claims, eligibility, and other matters.
The grievance procedure provided by this subsection shall be the
exclusive remedy available to persons having complaints against the
insurer. Such grievance procedure shall be subject to the Oklahoma
Administrative Procedures Act, including provisions for the review
of agency decisions by the district court. The grievance panel
shall schedule a hearing regarding the allowance and payment of
claims, eligibility and other matters within sixty (60) days from
the date the grievance panel receives a written request for a
hearing. Upon written request to the grievance panel received not
less than ten (10) days before the hearing date, the grievance panel
shall cause a full stenographic record of the proceedings to be made
by a licensed or certified court reporter at the insured employee's
expense.
E. The Board may establish a claim processing division for
claims administration or may contract for claims administration
services with a private insurance carrier or a company that
specializes in claims administration of any i nsurance that the Board
may be directed to offer.
SECTION 8. AMENDATORY 74 O.S. 2021, Section 1332.1, is
amended to read as follows:
Section 1332.1 A. The State and Education Employees Group
Insurance The Oklahoma Employees Insurance and Benefits Board shall
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collect from state agencies each month, the premium amount, as
determined by the Board, for each employee of a state agency that
participates in the Disability Insura nce Program. Said sum shall be
deposited in the State Empl oyees Disability Insurance Reserve Fund
for use in accordance with law.
B. The State and Education Employees Group Insurance Oklahoma
Employees Insurance and Benefits Board shall submit a monthly
statement of the revenues and disbursements of the Disability
Insurance Program to the Governor, the Speaker of the House of
Representatives, the President Pro Tempore of the Senate and the
Legislative Service Bureau. The Legislative Service Bureau shall
distribute copies of such monthly statements to the fiscal staff of
the House of Representatives and the State Senate.
C. On or before March 1 of each year, the State and Education
Employees Group Insurance Oklahoma Employees Insurance and Benefits
Board shall submit a report of the actuarially -determined future
needs of the Disability Insurance Program. Said report shall be
submitted and distributed as provided for in subsection B of this
section.
D. The Board shall provide for the continuation of depen dent
health coverage to disability recipients for that peri od of time
when the employee is qualified as disabled but not yet received
disability benefit income.
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E. The Board shall deduct all dependent health coverage
premiums due and owing from the first retroactive disability payment
and each payment thereafter.
SECTION 9. AMENDATORY 74 O.S. 2021, Section 1346, is
amended to read as follows:
Section 1346. There is hereby created in the State Treasury a
revolving fund for the State and Education Employees Group Insurance
Oklahoma Employees Insurance and Benefits Board to be designated the
"Flexible Benefit Revolving Fund". The fund shall be a continuing
fund, not subject to fiscal year limitations, and shall consist of
employee payroll deductions and contributions for flexible spending
accounts. All monies accruing to the credit of said fund are hereby
appropriated and may be budgeted and expended by the State and
Education Employees Group Insurance Oklahoma Employees Insurance a nd
Benefits Board for expenses of the state employees flexi ble benefits
plan and for expenses authorized by law. The State and Education
Employees Group Insurance Oklahoma Employees Insurance and Benefits
Board is authorized to pay employee claim costs as sociated with the
state employees flexible benefits plan from monies accrued for said
purpose. Expenditures from said funds shall be pursuant to the laws
of the state and statutes relating to the state employees flexible
benefits plan.
SECTION 10. AMENDATORY 74 O.S. 2021, Section 1370, is
amended to read as follows:
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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 Un ited States military and has been
provided with health care through 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 coverage, flexible
benefit dollars may be used to purchase any of the benefits offered
by the Oklahoma State Employees Benefits Council Oklahoma Employees
Insurance and Benefits Board under the flexible benefits plan. A
participant who has opted out of the state's basic plan and provided
proof of other coverage as described in this subsection shall
receive One Hundred Fifty Dollars ($150.00) in lieu of the flexib le
benefit monthly. A participant's flexible benefit dolla rs for a
plan year shall consist of the sum of (1) flexible benefit allowance
credited to a participant by the participating employer, and (2) pay
conversion dollars elected by a participant.
B. Each participant shall be credited annually with 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 shal l be
credited over twenty -four pay periods resulting in two pay periods
that do not reflect a credit. The amount of the flexible benefit
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allowance credited to each participant shall be communicated to him
or her prior to the enrollment period for each pla n year.
C. Except as provided in subsection D of this section, for the
plan year beginning January 1, 2013, the benefit allowance shall not
be less than the Plan Year 2012 benefit allowance amounts, and each
plan year thereafter, the amount of a participa nt's benefit
allowance, which shall be the total amount the employer contributes
for the payment of insurance premiums 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
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 state employ ees or the amount determined
by the Council based on a form ula 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 p articipant
would have qualified for as of plan year 2021 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 o f the basic life
insurance plan offered to state employees plus one of the additional
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amounts as follows for participants who elect to include one or more
dependents:
a. for a spouse, seventy -five percent (75%) of the
HealthChoice High Option plan, availab le 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,
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 p lan,
for coverage of a spouse and two or more children;
3. For the plan year beginning January 1, 2022, the amount 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 beginning January 1, 2023, the amount of a
participant's benefit allowance shall be increased by two percent
(2%) from the amount provided in the previous year; or
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5. The greater of the amount of benefit which the participant
would have qualified for as of plan year 2023, 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 state employees plus one of the additional
amounts as follows for participants 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,
d. for a spouse and one child, seventy-five percent (75%)
of the HealthChoice H igh 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 t wo or more children.
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D. To the extent that it is consistent with federal laws and
regulations, and in particular 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 eli gible TRICARE beneficiary
whereby he or she may purchase a group TRICARE Supplemental product
under a qualifying cafeteria plan consistent with the requirements
of 26 U.S.C., Section 125, provided that:
1. The state, as employer, may not provide any payme nt 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 comp letely
voluntary.
The benefit allowance under paragraph 2 o f 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 D am
Authority.
F. If a participant desires to buy benefits whose sum total of
benefit prices is in excess of his or her flexible benefit
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allowance, the participant may elect to use pay conversion dollars
to purchase such excess benefits. Pay conversion do llars may be
elected through a salary reduction agreement made pursuant to the
election procedures of Section 1371 of this title. The elected
amount shall be deducted from the participant's compensation in
equal amounts each pay period, with the exception of participants on
a biweekly payroll system, where such d eduction shall occur over
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 conversion
dollars allocated to the portion of the plan year after the
participant's termination of employment.
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 compensation will be paid in
substantially equal amounts each pay period, with the exception of
participants on a biweekly payroll system, where such deduction
shall occur over twenty-four pay periods over the plan year. On
termination during a plan year, a participant shall have no 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 mi nimum
benefits or to accept the default benefits of the plan with
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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 11. REPEALER 74 O.S. 2021, Section 1329.1, is
hereby repealed.
SECTION 12. REPEALER 74 O.S. 2021, Sections 1381, 1382,
1383, and 1384, are hereby repealed.
SECTION 13. This act shall become effective November 1, 2024.
COMMITTEE REPORT BY: COMMITTEE ON RETIREMENT AND INSURANCE
April 2, 2024 - DO PASS