An Act
ENROLLED 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 plan 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, Sectio n 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 refere nces to entity names
and updating citations; amending 74 O.S. 2021,
Section 1332.1, which relates to collections from
state agencies; modifying references to entity na mes;
amending 74 O.S. 2021, Section 1346, which relates to
creation of flexible benefit revolving fund;
modifying references to entity names; amendin g 74
O.S. 2021, Section 1370, which relates to flexible
benefit dollars in the Oklahoma State Employees
Benefits Act; modifying references to entity names ;
repealing 74 O.S. 2021, Section 1329.1, which relates
to mutual accountability incentive pilot program ;
repealing 74 O.S. 2021, Sections 1381, 1382, 1383,
and 1384, which relate to the Wellness Program Act;
and providing an effective date . ENR. H. B. NO. 3586 Page 2
SUBJECT: State employee health
BE IT ENACTED BY THE PEO PLE 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 technolog y center school
district. Technology center school districts may obtain health and
dental insurance coverage as prov ided for in the State and Education
Employees Group Insurance Oklahoma Employees Insurance and Ben efits
Act or may obtain other health insu rance coverage. Any technology
center district that does not partic ipate in the health and dental
insurance plans offered through the State and Education Employees
Group Insurance Oklahoma Employees Insurance and Be nefits Act shall
obtain health insurance coverage for the employees which provides
open enrollment, and prov ide for the continuation of health
insurance coverage, including supplemental Medicare insurance
coverage, for those district employees who retire f rom said district
after September 30, 19 91, with a vested benefit in the Teachers '
Retirement System of Okla homa. A retired person who begins
receiving benefits from the Teachers' Retirement System of Oklahoma
after September 30, 1991, who retires from a technology center
school district that p rovides other health insurance coverage, and
who elects to continue said health insurance coverage shall pay to
the technology center school district the premium rate for 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 Statutes,
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 school
district employees or their qualified sur vivors.
B. A technology center school d istrict that participates in
health insurance coverage other than th e health insurance plan
offered by the State and Education Employees Group Insurance
Oklahoma Employees Insurance and Bene fits Act shall not be requ ired
to pay any portion of the premium f or the employees or the
dependents of the employees of said school d istrict. Unless a
school district negotiates an agreement with its employees regarding ENR. H. B. NO. 3586 Page 3
health insurance pursu ant 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
Employees Group Insurance Oklahoma Employees Insurance and Bene fits
Act is prohibited from acquirin g additional or supplemental health
or dental insurance for any board member, superintendent or any
other employee which is not available to all emp loyees of said
district, and said techno logy center school district shall not pay a
greater portion of the e mployee or dependent premium for any health
or dental insurance plan or plans provided by said technology center
school district on behalf of any bo ard member, superintendent or
employee than that portion paid on behalf of all participating
employees of said district.
C. If a technology center school district obtains health
insurance coverage from a source other than through the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Act, the employees of the technology cent er school district
who would be eligible to par ticipate in the health and dental plans
may require the board of education of the technology center s chool
district to call an election to al low said employees to vote as to
whether the technology center schoo l 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 su ch 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
an election for the purpose of determining whether the technology
center school distri ct shall participate in the health and dental
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 employees vo ting 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 Bene fits Act, the board
of education of the technology center school distri ct shall apply
for such participation within thirty (30) days of the election.
D. If a technology ce nter school district does not have any
health insurance coverage of the type required by this section, that
technology center school district shall immedi ately be enrolled in ENR. H. B. NO. 3586 Page 4
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 insuran ce 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 te rminates 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
the time the previou s carrier providing health insurance coverage is
replaced. Notwithstanding any provision in this section to the
contrary, any person who retires pursuant to the provisions o f the
Teachers' Retirement System of Oklah oma 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 d ental plans
authorized by the provisions o f the State and Education Employees
Group Insurance Oklahoma Employees Insurance and Bene fits Act.
F. In the event a technology center school district 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 employees of the
technology center school district that is ceasing to exist, and said
former employees who are not being reemployed have rights und er
federal or state law to continue group insurance coverage, the
annexing technology center school district having the largest
general fund revenue for the most recent preceding fiscal year for
which data is availab le shall provide group insurance coverag e 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:
Section 26-104. A. Each fiscal year, t he Legislature shall
appropriate adequate funding to the State Board of Education and th e
State Board of Career and Technology Education for the purpose of
providing a flexible benefit all owance to school district employees
pursuant to this act. Unless th e Legislature appropriates adequate
funding specifically for the purpose of providing a flexible benefit
allowance to school district employees, the Oklahoma State Board of ENR. H. B. NO. 3586 Page 5
Education shall allocate from the funds appropriated to the Oklahoma
State Board of Education for the support of public sch ool activities
an amount to fully fund the flexi ble benefit allowanc e, 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 th e number of eligible
school district employees e mployed by school di stricts which are
participating in the health insurance plan offered by the State and
Education Employees Group Insurance Oklahoma Employees Insuran ce and
Benefits Board or are self-insured as counted in February of each
year by the amount of the flexible benefit allowance credited to the
eligible school employees as established in Section 26-105 of this
title. Each Board shall disburse the total amo unt appropriated for
funding the flexible benefit allowance to school districts during
the fiscal year. Fro m the total amount appropriated, each Board
shall disburse the appropriate amo unts, based on the number of
eligible school district employees employ ed by that school district,
to each school district.
B. Every school district shall est ablish or make avail able to
school district employees a cafeteria p lan 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 esta blished 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 co verage in
the health insurance plan offered by t he State and Education
Employees Group Insurance Oklahoma Employees Insurance and Benefits
Board or the self-insured plan offered by the sch ool district and
may receive the excess flexible benefit allowance a s taxable
compensation as provided in Section 26 -105 of this title.
D. The administrator of the cafeteria plan sha ll maintain a
separate account for each participating school district emp loyee.
School districts sha ll forward the school district employee flexible
benefit allowance amounts to the admini strator for elected purchases
of cafeteria plan benefits.
E. Expenses included in an employee 's salary adjustment
agreement pursuant to the cafeteria plan shall be lim ited to
expenses for:
ENR. H. B. NO. 3586 Page 6
1. Premiums for any health insurance, health maintenance
organization, life insurance , long term disability insurance, dental
insurance or high deductible health ben efit plan offered to
employees and their dependents; and
2. All other eligible benefit programs offered und er 26 U.S.C.
Section 125 of the United States Co de.
F. The flexible benefit allowance amount established in Sectio n
26-105 of this title shall not be included as income in computation
of state retirement contributio ns and benefits or as part of the
Minimum Salary Schedule for teachers established in Se ction 18-
114.12 of this title. School districts shall not consider the
flexible benefit allowance a mount 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 fol lows:
Section 26-105. A. The flexible benefit al lowance shall be
used by a school district employee who is participa ting in the
cafeteria plan to purchase m ajor medical health care plan coverage
offered by the school distri ct through a cafeteria plan. Any excess
flexible benefit allowance over the cost of the major medical
coverage purchased by the employee who is part icipating in the
cafeteria plan may be u sed to purchase any of the additional
benefits offered by the schoo l district or may be taken as taxable
compensation as provided in subsection 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 month as taxable compensation in lieu
of the flexible benefit allowance am ount provided in subsection B of
this section. Support personnel wh o 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 i n lieu of the flexible benefit allowance
amount provided in subsecti on B of this section.
B. Each eligible school district employee shall be credited
annually with a specifi ed amount as a flexible benefit allowance
which shall be available for the purchas e of benefits. The amount
of the flexible benefit allowance credite d to each eligible school
district employee shall be communicated to the employee prior to the
enrollment period for each plan year. ENR. H. B. NO. 3586 Page 7
1. For the fiscal year ending June 30, 2002, the flexi ble
benefit allowance amount for certified personnel shall be no les s
than Sixty-nine Dollars and seventy -one cents ($69.71) per month.
For the fiscal year ending June 30, 2002, the flexible benefit
allowance amount for support personnel shall be no less than One
Hundred Eighty-nine Dollars and sixty -nine cents ($189.69) per
month.
2. For the fiscal year endin g June 30, 2004, the flexible
benefit allowance amount for certi fied personnel shall be no less
than fifty-eight percent (58%) 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. For the fiscal year 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 In surance 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 less than one hundred percent (100%) of the
premium amount for the HealthCh oice (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 dist rict employee who is participating in the
cafeteria plan elects benefits whos e sum total is less than the
flexible benefit allowance, the employee shall r eceive any excess
flexible benefit allow ance as taxable compensation. Such taxable
compensation shall be paid in substantially equal amounts each pay
period over the plan year. Except as otherwise provided for in
subsection D of this section, on terminat ion during a plan year, a
participating school district employee shall have no right to
receive any taxable cash compensation allocated to the portion of
the plan year after the t ermination of the employee.
D. In cases where the employee of a school distr ict fulfills
the terms of their contract and terminates employment for the
subsequent year, the emplo yee shall be entitled to the flexible
benefit allowance for the remainder of t he current benefit term.
For purposes of this subsection, "benefit term" shall mean the ENR. H. B. NO. 3586 Page 8
twelve-month period after th e initiation of benefits for the
position held by the employe e.
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 peri od
dates will be determined annually and will be announced b y 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 adva nce 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 r equired to use in making their
elections, and may prescribe deadlines and other procedures for
filing the elections.
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 shal l have the option of
providing a flexible benefit allowan ce to the superintendent of the
school district in an amount not more than the amo unt of the
flexible benefit allowance established for certified personnel in
subsection B of this section. Funding f or the flexible benefit
allowance for a superintendent sh all be provided through 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 other
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;
ENR. H. B. NO. 3586 Page 9
3. Transfer risks, if economically advantageous to the state,
by acquiring commercia l insurance, contractual pass through of
liability, or by other means;
4. Consolidate and administer risk m anagement plans and
programs including self-insurance programs, except State Employees
Group Insurance;
5. Determine feasibility of and, if feasibl e, establish self-
insurance programs, co nsidering whether a program may be self-
supporting to remain financi ally and actuarially sound;
6. Provide a system to allocate ins urance and program costs to
determine payment for insurance coverage and program exp enses
provided by the Office of Manageme nt and Enterprise Services;
7. When requested by a state retirement system or the State and
Education Employees Group Insurance Oklahoma Employees Insurance and
Benefits Board, assist in obtaining insurance authoriz ed by law. If
requested by the Oklahoma State Regents for Higher Educat ion, assist
trust funds for which th e 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 obt aining insurance
for liability for judgments, based on the licensing authority,
rendered by any court pursuant to federa l law;
9. When requested by a public trust established pursuant to
Title 60 of the Oklahoma Sta tutes of which the State of Oklahoma is
the beneficiary, obtain, provi de or assist the public trust in
obtaining insurance authorized by law or trust indenture covering
any board member, trustee, official, officer, employee or volunteer
for errors and omissions or liability risks arising from th e
performance of official duti es pursuant to law or trust indenture;
10. When requested by the Oklahoma State Regents f or Higher
Education, for the purpose of insuring real property required
pursuant to Section 4018 of Title 70 of the Oklahoma Statutes, o f
which the Oklahoma State Re gents for Higher Education is the
beneficiary, obtain, provide or assist the Oklahoma State Regents
for Higher Education in obtaining insurance for the real property
pursuant to the provi sions of this section; and
ENR. H. B. NO. 3586 Page 10
11. Authorize the Risk Management Admini strator 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 Manag ement and Enterprise
Services may hire or contract for the services 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 employ ee, the Risk Management
Administrator shall be in the unclassified s ervice.
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 ot her entities
as provided by law. All entities shall submit to the R isk
Management Administrator all information which t he Risk Management
Administrator deems necessary to perform this duty.
D. The Risk Management A dministrator in conjunction with the
State Purchasing Director un der the authority of the Director of the
Office of Management and Enterprise Services may negot iate 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 solicitati on and
qualification of insurance coverage and servi ces providers. The
State Purchasing Director shall award contracts for insurance
coverage and services to the provider or providers whi ch offer the
best and final terms and conditions. The State Purchas ing Director
may authorize the Risk Management Admin istrator to bind for
insurance coverage with providers.
E. The school districts of this state m ay request the Risk
Management Administr ator to advise for the purchase of insurance
coverage for the school districts.
F. A state agency, whether or not subje ct to the Oklahoma
Central Purchasing Act, that contemplates purchase of property and
casualty insurance, shall provide details of the p roposed purchase
to the Risk Management Administrator for approval o r disapproval
prior to the purchase.
G. The Director of the Office of Management and Enterprise
Services shall promulgate rules to effect the provi sions of the
comprehensive professional risk management program. ENR. H. B. NO. 3586 Page 11
H. 1. a. Any community action agency estab lished pursuant to
Sections 5035 through 5040 of this title may
participate in the comprehensive professional risk
management program established pu rsuant to this
section for risks incurre d as a result of operating a
Head Start program or providing transpo rtation
services to the public. The Risk Management
Administrator shall obtain or provide for insurance
coverage for such community action agencies or bonding
for employees of such commun ity action agencies. Any
liability insurance coverage obtained or p rovided
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 A dministrator may
require each such community action agency to:
(1) provide adequate qualified p ersonnel and suitable
facilities and equipment for operating a Head
Start program or providing transportatio n
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 p ursuant to this section, a community
action agency shall make payments for any insurance coverage and
shall otherwise comply with the provisions of this section and rules
promulgated by the Office pursuant to the provisions of this
section.
3. Requests for the insurance coverage provided pursua nt to the
provisions of this subsection shall be submitted in writin g to the
Risk Management Administrator by the communi ty 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 thereof, ins urance for
liability for loss, including judgments, a wards, settlements, costs
and legal expenses, resulting from violations of rights or ENR. H. B. NO. 3586 Page 12
privileges secured by the Constitution or laws of the United States
of America which occur while a director, officer, employee or member
is acting within the scope of serv ice to the State of Oklahoma. The
insurance shall be for coverage in excess of the limits on l iability
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
beneficiary, or any director, officer, employ ee or member thereof
including, but not limited to, any immunities under the Eleventh
Amendment to the Const itution 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 follows:
Section 1316.2 A. Any employee, other than an education
employee, who retires pursuant to the p rovisions 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 con tinue in force the health and dental
insurance benefits authorized by the provisio ns of the Oklahoma
Employees Insurance and Benefits Act, or other em ployer insurance
benefits if the empl oyer does not participate in the plans offered
by the Office of Manag ement and Enterprise Services, if such
election to continue in force is made withi n 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 educati on employees who have terminated
service and are not receiving benefits and effective July 1, 1996,
nonvested persons who have terminated service with more than eight
(8) years of particip ating 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 t he
insurance premium at the rate and pursuant to the terms and
conditions established by the Office. Provided also, any employee
other than an educat ion employee who commences employment with a
participating employer on or after September 1, 1991, who ter minates
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 provi sions of the
Oklahoma Public Employees Retirement System or to elect to continue
coverage as a nonvested employee as provided in this section, but ENR. H. B. NO. 3586 Page 13
who, immediately prior to employment with the participating
employer, was covered as a dependent on the healt h and dental
insurance policy of a spouse who was 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 du ring 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 t he
indemnity plans offered through the Office,
c. Medicare supplements o ffered pursuant to the Oklahoma
Employees Insurance and Benefits Act,
d. Medicare risk-sharing contracts offered as
alternatives to the Medicare suppl ements offered
through the Office. All Medicare risk-sharing
contracts shall be subject to a risk adjustm ent
factor, based on generally accepted actuarial
principles for adverse selection which may occur, and
e. for the Oklahoma Publi c Employees Retirement System,
other employer-provided health insurance benefit plans
if the employer does not participate in t he plans
offered pursuant to the Oklahoma 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 Medicare Prescription Dr ug Improvement and
Modernization Act of 2003, pursuant to 42 USCA Section 1395w-101, et
seq., for which provision of prescription drug benefits is opt ional,
and except for plans of fered pursuant to subparagraph e of paragraph
1 of this subsection.
C. 1. Designated public retirement systems shall contr ibute a
monthly amount towards the health insurance premium of certain
individuals receiving benefits from the public retirement sy stem as
follows:
ENR. H. B. NO. 3586 Page 14
a. a retired employee, other than an education 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 bene fits from the
Oklahoma Public Employees Retirement System after
September 30, 1988, shall have One Hundred Five
Dollars ($105.00), or the premium rate of the he alth
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 be nefits from the
Oklahoma Law Enforcement Retirement System after
September 30, 1988, is under sixty-five (65) years of
age and is not otherwise eligib le for Medicare shall
have the premium rate for the health insurance benefit
plan or One Hundred Five Doll ars ($105.00), whichever
is less, paid by the Oklahoma Law Enforcement
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 Oklaho ma 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 a nd is eligible
for Medicare shall have One Hundred Five Dollars
($105.00), or the premium rate of the heal th insurance
benefit plan, whichever is less, paid by the Oklahoma
Law Enforcement Retirement System to the Office in the
manner specified in subsecti on 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 ENR. H. B. NO. 3586 Page 15
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 provisions
of the Oklahoma Employees Insurance and Benefits Act,
except that if an employer from which an emplo yee
retired or with a vested benefit pursuant to the
provisions of the Oklahoma Public Employees Retirement
System does not participate in the plans authorized 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 amou nt 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 dru g 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 sub section G of this section.
D. For any member of the Oklahoma Law Enforcement Reti rement
System killed in the line of duty, whether the member was kil led in
the line of duty prior to May 18, 2005, or on or after May 18, 2005,
or if the member was on a disa bility leave status at the time of
death, the surviving spouse or dependents of su ch deceased member of
the Oklahoma Law Enforcement Retirement System may elect to continue
or commence health and dental insurance benefits, provided the
dependents pay the f ull cost of such insurance, and for deaths
occurring on or after July 1, 2002, suc h 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 quali fy as dependents. ENR. H. B. NO. 3586 Page 16
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 spou se of such retired member and
any surviving spouse of a member who was killed in t he 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 co verage under the Medicare supplement or
Medicare risk-sharing contract, paid by th e Oklahoma Law Enforcement
Retirement System to the Office in the ma nner specified in
subsection H of this s ection. For plans offered by the Office, such
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 ti me of death or of a
participating retardant or of any person who h as elected to receive
a vested benefit under the Oklahoma Public Employees Retirem ent
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 f orce, provided the dependents pay
the full cost of such insurance and they were co vered as eligible
dependents at the time of such death and such elec tion is made
within thirty (30) days of date of death. The eligibility for the
benefits shall terminate f or 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 Sys tem for
Justices and Judges and the Oklahoma Law Enforcement Retir ement
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 Sy stem Board of Trustees
or the Oklahoma Law Enforcement Retirement Board to the Office for
deposit in the Health, Dental and Life Insurance Reserve F und or to
another insurance carrier or other administrator of qualif ied
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 p erson who was or is employed at the
George Nigh Rehabilitation Insti tute and who transferred employment
pursuant to Section 3427 of Title 70 of the Oklahoma Statutes, any
person who was employed at the Medical Technology and Research ENR. H. B. NO. 3586 Page 17
Authority and who tran sferred employment pursuant to Section 7068 of
this title and any pe rson who is a member of the Oklahoma Law
Enforcement Retirement System pursuant to the authority of Sectio n
2-314 of Title 47 of the Oklahoma Statutes may participate in the
benefits authorized by the provisions of the Oklahoma Employees
Insurance and Benefits Act for retired participants includ ing
health, dental and life insurance benefits, if such election t o
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 t he person
had at the time of such transfer . Retirees who transfer red
employment and who participate pursuant 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 b e 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 h ave
the authority to annually adjust the r ates and benefits based on
claim experience.
B. The premiums for such insurance plans offered for the next
plan year shall be established as follow s:
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 t he 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 fo urth Friday of September.
C. The Office may approve a mid -year adjustment provided the
need for an adjustme nt is substantiated by an actuarial
determination or more current experience rating. The only
publication or notice requirements that shall apply t o the Schedule ENR. H. B. NO. 3586 Page 18
of Benefits shall be those requirements provide d in the Oklahoma
Open Meeting Act. It is the intent of the Legislature that 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:
Section 1332. A. The State and Education Employees Group
Insurance Oklahoma Employees Insurance and Benefits Board shall
establish a Disability Ins urance Program for state employees. Th e
program shall consist of a long -term disability plan and a short -
term disability plan. Participation i n 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 en rollment in the
Health Insurance Plan administered by the Board. No state employee
shall be eligible to receive any benefits from the lo ng-term
disability program unless the state employee has used all of the
sick leave of the employee. The Board shall p romulgate such rules
as are necessary for adoption and administration of the Disability
Insurance Program, including but not limited to b enefit eligibility
requirements, methods for computing benefit amounts, benefits
amounts, and verification of medical a nd health status of employees
applying for or receiving benefits.
B. The Disability Insurance Program sh all be funded from
appropriations made by the Legislature. Employees shall not be
required to make contribution s to participate in the program.
C. Employee disability insurance coverag e shall begin on March
1, 1986.
D. The Board shall establish a grieva nce 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
title shall act as an appeals body for complaints regarding the
allowance and payment of claims, eligibi lity, and other matters.
The grievance procedure provided by this subsection shall be the
exclusive remedy avai lable to persons having complaint s against the
insurer. Such grievance pr ocedure shall be subject to the Ok lahoma
Administrative Procedures Act , including provisions for the r eview
of agency decisions by the district court. The grievance panel
shall schedule a hearing regarding the allo wance and payment of
claims, eligibility and other matters within sixty (60 ) days from
the date the grievance p anel receives a written request for a ENR. H. B. NO. 3586 Page 19
hearing. Upon written request to the grievance panel received not
less than ten (10) days before the heari ng 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 d ivision for
claims administration or may contract for claims administratio n
services with a private insuranc e carrier or a company that
specializes in claims administration of any insurance that the Board
may be directed to offer.
SECTION 8. AMENDATORY 74 O.S. 2021, Sec tion 1332.1, is
amended to read as follows:
Section 1332.1 A. The State and Education Employees Group
Insurance The Oklahoma Employees Insurance and B enefits Board shall
collect from state agencies each month, the premium amount, as
determined by the Bo ard, for each employee of a state agency that
participates in the Disability Insuranc e Program. Said sum shall be
deposited in the State Employees Disab ility Insurance Reserve Fund
for use in accordance with law.
B. The State and Education Employees Gro up 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 Pres ident Pro Tempore of t he Senate and the
Legislative Service Bureau. The Legis lative 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 eac h year, the State and Education
Employees Group Insurance Oklahoma Employees I nsurance 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 s ubsection B of this
section.
D. The Board shall provide for the continuation of depend ent
health coverage to disability recipients for that period of time
when the employee is qualified as disabled but not yet receiv ed
disability benefit income.
ENR. H. B. NO. 3586 Page 20
E. The Board shall deduct all dependent health coverage
premiums due and owing from the first r etroactive 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 accr uing 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 and
Benefits Board for expenses of the state employees flexible 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 associated with the
state employees flexible benefits plan from monies accrued for sa id
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 foll ows:
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 th e benefits offered
by the Oklahoma State Employees Benefits Coun cil Oklahoma Employees
Insurance and Benefits Board under the flexible benefits plan. A
participant who has opted out of the s tate's basic plan and provided
proof of other coverage as describ ed in this subsection shall
receive One Hundred Fifty Dollars ($150.00) in lieu of the flexib le
benefit monthly. A participant's flexible benefit dollars for a
plan year shall consist of the sum of (1) flexible benefit allowance ENR. H. B. NO. 3586 Page 21
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 par ticipants 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 cred it. The amount of the flexible benefit
allowance credited to ea ch 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 Januar y 1, 2013, the benefit allowance shall not
be less than the Pla n 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 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 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
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, ENR. H. B. NO. 3586 Page 22
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
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 p lan, 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 t o 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 High Option plan, for coverage of
a spouse and one child, or ENR. H. B. NO. 3586 Page 23
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.
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 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 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
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 deduction 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 ENR. H. B. NO. 3586 Page 24
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 w ill 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 minimum
benefits or to accept 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 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.
ENR. H. B. NO. 3586 Page 25
Passed the House of Representatives the 6th day of March, 2024.
Presiding Officer of the House
of Representatives
Passed the Senate the 25th day of April, 2024.
Presiding Officer of the Senate
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this ____________________
day of ___________________, 20 _______, at _______ o'clock _______ M.
By: _________________________________
Approved by the Governor of the State of Oklahoma this _____ ____
day of ___________________, 20_______, at _______ o'clock _______ M.
_________________________________
Governor of the State of Oklahoma
OFFICE OF THE SECRETARY OF STATE
Received by the Office of the Secretary of State this __________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _________________________________