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STATE OF OKLAHOMA
2nd Session of the 59th Legislature (2024)
HOUSE BILL 3587 By: Strom
AS INTRODUCED
An Act relating to state government; amending 74 O.S.
2021, Section 1304.1, which relates to Oklahoma
Employees Insurance and Benefits Board; modifying
certain duties and responsibilities ; adding external
review requirements; repealing 74 O.S. 2021, Section
1329.1, which relates to mut ual 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.
BE IT ENACTED BY THE PEOPL E OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 74 O.S. 2021, Section 1304.1, is
amended to read as foll ows:
Section 1304.1 A. The State and Education Employees Group
Insurance Board and the Oklahoma State Employees Benefits Council
are hereby abolished. Wherever the State and Education Employees
Group Insurance Board and the Oklahoma State Employees Bene fits
Council are referenced in law, that reference shall be construed to
mean the Oklahoma Employees Insurance and Benefits Board.
B. There is hereby created the Oklahoma Employees Insurance and
Benefits Board.
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C. The chair and vice-chair shall be electe d by the Board
members at the first meeting of the Board and shall preside over
meetings of the Board and perform other duties as may be re quired by
the Board. Upon the resignation or expiration of the term of the
chair or vice-chair, the members shall el ect a chair or vice-chair.
The Board shall elect one of its members to serve as secretary.
D. The Board shall consist of seven (7) member s to be appointed
as follows:
1. The State Insurance Commissioner, or desi gnee;
2. Four members shall be appointed by the Governor;
3. One member shall be appointed by the Speaker of the Oklahoma
House of Representatives; and
4. One member shall be app ointed by the President Pro Tempore
of the Oklahoma State Senate.
E. The appointed members shall:
1. Have demonstrated professional experience in investment or
funds management, public funds management, public or private group
health or pension fund management, o r group health insurance
management;
2. Be licensed to practice law in thi s state and have
demonstrated professional experience in commercial matters; or
3. Be licensed by the Oklahoma Accountancy Board to practice in
this state as a public accountant or a certified public accountant.
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In making appointments that conform to the requirements of this
subsection, at least one but not more than three members shall be
appointed each from paragraphs 2 and 3 of this subsection by the
combined appointing authoriti es.
F. Each member of the Board shall serve a term of four (4)
years from the date of appointment.
G. Members of the Board shall be subject to the following:
1. The appointed members shall each receive compensation of
Five Hundred Dollars ($500.00) per month. Appointed members who
fail to attend a regularly scheduled meeting of the Board shall not
receive the related compensation;
2. The appointed members shall be reimbursed for their
expenses, according to the State Travel Reimbursement Act, as are
incurred in the performance of their duties, which shall be paid
from the Health Insurance Reserve Fund;
3. In the event an appointed member does not attend at least
seventy-five percent (75%) of the regularly scheduled meetings of
the Board during a calend ar year, the appointing authority may
remove the member;
4. A member may also be removed for any other caus e as provided
by law;
5. No Board member shall be individually or personally liable
for any action of the Board; and
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6. Participation on the Board is contingent upon maintaining
all necessary annual training as may be req uired through the Health
Insurance Portability and Accountability Act of 1996, Medicare
contracting requirements or other statutory or regulatory
guidelines.
H. The Board shall mee t as often as necessary to conduct
business, but shall meet no less than fou r times a year, with an
organizational meeting to be held prior to December 1, 2012. The
organizational meeting shall be called by the Insurance
Commissioner. A majority of the me mbers of the Board shall
constitute a quorum for the transaction of busines s, and any
official action of th e Board must have a favorable vote by a
majority of the members of the Board present.
I. Except as otherwise provided in this subsection, no member
of the Board shall be a lobbyist registered in this state as
provided by law, or be employed directly or in directly by any firm
or health care provider under contract to the State and Education
Employees Group Insurance Board, the Oklahoma State Employees
Benefits Council, or the Oklahoma Employees Insurance and Benefits
Board, or any benefit program under its jurisdiction, for any goods
or services whatsoever. Any physician member of the Board shall not
be subject to the provisions of this subsection.
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J. Any vacancy occurring on the Board shall be filled for the
unexpired term of office in the same manner as provided for in
subsection D of this section.
K. The Board shall act in accordance with the provisions of the
Oklahoma Open Meeting Act, the Oklahom a Open Records Act and the
Administrative Procedures Act.
L. The Administrative Director of the Courts sha ll designate
grievance panel members as shall be necessary. The members of the
grievance panel shall consist of two attorneys licensed to practice
law in this state and one state licensed health care professional or
health care administrator who has at le ast three (3) years practical
experience, has had or has admitting privileges to a hospital in
this state, has a working knowledge of prescription me dication, or
has worked in an administrative capacity at some point in thei r
career. The state health care professional shall be appointed by
the Governor. At the Governor 's discretion, one or more qualified
individuals may also be appointed as an altern ate to serve on the
grievance panel in the event the Governor 's primary appointee
becomes unable to serve.
M. The Office of Management and Enterprise Services shall have
the following duties, responsibilities and authority with respect to
the administration of the flexible benefits plan authorized pursuant
to the State Employees Flexible Benefits Act:
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1. To construe and interpret the plan, and decide all questions
of eligibility in accordance with the Oklahoma State Employees
Benefits Act and 26 U.S.C.A., Section 1 et seq.;
2. To select those benefits which shall be made availa ble to
participants under the pl an, according to the Oklahoma State
Employees Benefits Act, and other applicable laws and rules;
3. To prescribe procedures to be followed by partic ipants in
making elections and filing claims under the plan;
4. Beginning with the plan year which begins on January 1,
2013, to select and contract with one or more providers to offer a
group TRICARE Supplement product to eligible employees who are
eligible TRICARE beneficiaries. Any membership dues required to
participate in a group TRICARE Supplement produ ct offered pursuant
to this paragraph shall be paid by the employee. As used in this
paragraph, "TRICARE" means the Department of Defense health car e
program for active duty and retired service members and their
families;
5. To prepare and distribute inf ormation communicating and
explaining the plan to participating employers and participants.
Health Maintenance Organizations or other third -party insurance
vendors may be directly or indirectly involved in the distribution
of communicated information to pa rticipating state agency employers
and state employee participants subject to the following condition:
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the Board shall verify all marketing and comm unications information
for factual accuracy prior to distribution;
6. To receive from participating employ ers and participants
such information as shall be necessary for the proper administration
of the plan, and any of the benefits offered thereunder;
7. To furnish the participating employers and participants such
annual reports with respect to the administr ation of the plan as are
reasonable and appropriate;
8. To keep reports of benefit elections, claims and
disbursements for claims under the plan;
9. To negotiate for best and final offer through competitive
negotiation with the assistance and through the purchasing
procedures adopted by the Office of Management and Enterprise
Services, and contract with federally qualified health maintenance
organizations under the provisions of 42 U.S.C., Section 300e et
seq., or with Health Maintenance Organizations gra nted a certificate
of authority by the Insurance Commissioner pursuant to the Health
Maintenance Reform Act of 2003 for consideration by participants as
an alternative to the health plans offered by the Oklahoma Employees
Insurance and Benefits Board, and to transfer to the health
maintenance organizations such funds as may be approved for a
participant electing health maintenance organization alternati ve
services. The Board may also select and contract with a vendor to
offer a point-of-service plan. An HMO may offer coverage through a
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point-of-service plan, subject to the guidelines established by the
Board. However, if the Board chooses to offer a p oint-of-service
plan, then a vendor that offers both an HMO plan and a poin t-of-
service plan may choose to offer only its point-of-service plan in
lieu of offering its HMO plan. The Board may, however, renegotiate
rates with successful bidders after contr acts have been awarded if
there is an extraordinary circumstance. An extra ordinary
circumstance shall be limited to insolvency of a participating
health maintenance organization or point -of-service plan,
dissolution of a participating health maintenance o rganization or
point-of-service plan or withdrawal of another participating health
maintenance organizatio n or point-of-service plan at any time during
the calendar year. Nothing in this section of law shall be
construed to permit either party to unilater ally alter the terms of
the contract;
10. To retain as confidential inform ation the initial Request
For Proposal offers as well as any subsequent bid offers made by the
health plans prior to final contract awards as a part of the best
and final offer nego tiations process for the benefit plan;
11. To promulgate administrative ru les for the competitive
negotiation process;
12. To require vendors offering coverage to provide such
enrollment and claims data as is determined by the Board. The Board
shall be authorized to retain as confidential any proprietary
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information submitted in response to the Board 's Request For
Proposal. Provided, however, that any such information requested by
the Board from the vendors shall only be subject to the
confidentiality provision of this paragraph if it is clearly
designated in the Request For P roposal as being protected unde r this
provision. All requested information lacking such a designation in
the Request For Proposal shall be subject to Section 24A.1 et seq.
of Title 51 of the Oklahoma Statutes. From health maintenance
organizations, data provided shall include the curr ent Health Plan
Employer Data and Information Set (HEDIS);
13. To authorize the purchase of any insurance deemed necessary
for providing benefits und er the plan including indemnity dental
plans, provided that the only indemn ity health plan selected by the
Board shall be the indemnity plan offered by the Board, and to
transfer to the Board such funds as may be approved for a
participant electing a benef it plan offered by the Board. All
indemnity dental plans shall meet or exc eed the following
requirements:
a. they shall have a statewide provider network,
b. they shall provide benefits which shall reimburse the
expense for the following types of dental p rocedures:
(1) diagnostic,
(2) preventative,
(3) restorative,
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(4) endodontic,
(5) periodontic,
(6) prosthodontics,
(7) oral surgery,
(8) dental implants,
(9) dental prosthetics, and
(10) orthodontics, and
c. they shall provide an annual benefit of not less than
One Thousand Five Hundred Dollars ($1,500.00) for all
services other than orthodontic services, and a
lifetime benefit of not less than One Thousand Five
Hundred Dollars ($1,500.00) for orthodontic services;
14. To communicate deferred compensation programs as provided
in Section 1701 of Title 74 of the Oklahoma Statutes this title;
15. To assess and c ollect reasonable fees from contracted
health maintenance organizations and third -party insurance vendors
to offset the costs of administration;
16. To accept, modify or reject elections under the plan in
accordance with the Oklahoma S tate Employees Benef its Act and 26
U.S.C.A., Section 1 et seq.;
17. To promulgate election and claim forms to be used by
participants;
18. To adopt rules requiring payment for med ical and dental
services and treatment rendered by duly licensed hospitals,
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physicians and dentists. Unless the Board has otherwise contracted
with the out-of-state health care provider, the Board shall
reimburse for medical services and treatment rendere d and charged by
an out-of-state health care provider at least at the same percentage
level as the network percentage level of the fee schedule
established by the Oklahoma Employees Insurance and Benefits Board
if the insured employee was referred to the o ut-of-state health care
provider by a physician or it was an emergency situ ation and the
out-of-state provider was the closest in proximity to the place of
residence of the employee which offers the type of health care
services needed. For purposes of thi s paragraph, health care
providers shall include, but not be limited to, ph ysicians,
dentists, hospitals and special care facilities;
19. To enter into a contract with out -of-state providers in
connection with any PPO or hospital or medical network plan w hich
shall include, but not be limited to, special care facilities and
hospitals outside the bo rders of the State of Oklahoma. The
contract for out-of-state providers shall be identical to the in -
state provider contracts. The Board may negotiate for disc ounts
from billed charges when the out -of-state provider is not a network
provider and the memb er sought services in an emergency situation,
when the services were not otherwise available in the State of
Oklahoma or when the Administrator appointed by the Board approved
the service as an exceptional circumstance;
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20. To create the establishment of a grievance procedure by
which a three-member grievance panel external appeals procedures for
complaints by insured employe es in the following manner :
a. independent review organizations, accredited by a
national accrediting body, shall act as an appeals
body bodies for complaints by insured employees
regarding the allowance and payment of claims,
eligibility, and other matters. Except for grievances
settled to the satisfaction of both parties prior to a
hearing, any person who requests in writing a hearing
before the grievance panel shall receive a hearing
before the panel adverse benefit determinations based
on:
(1) medical judgment,
(2) whether the insurer is complying with the
surprise billing and cost -sharing protections set
forth in Sections 2799A-1 and 2799A-2 of the
Public Health Services Act,
(3) a rescission in coverage, and
b. a three-member grievance panel, which shall a ct as an
appeals body for complaints by insured employees
regarding all other issues .
The grievance procedure appeals procedures provided by this
paragraph shall be the exclusive remedy remedies available to
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insured employees having complaints against the insurer. Such
grievance procedure The appeals procedures of the three -member
grievance panel shall be subject to the Oklaho ma Administrative
Procedures Act, including provisions thereof for review of agency
decisions by the district court. The grievance p anel shall schedule
a hearing regarding the allowance and payment of claims,
eligibility and other matters within sixty (60) days from the date
of properly submitted the grievance panel receives a written request
for a hearing application unless the panel orders a continuance for
good cause shown. Upon written request by the insured employee to
the grievance panel and 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 competent
court reporter at the insured employee 's expense; and
21. To intercept monies owing to plan parti cipants from other
state agencies, when those participants in turn owe money to the
Office of Management and Enterprise Services, and to ensure that the
participants are afforded due process of law.
N. Except for a breach of fiduciary obligation, a Board member
shall not be individually or personally responsible for any action
of the Board.
O. The Board shall operate in an advisory capacity to the
Office of Management and Enterprise Services.
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P. The members of the Board shall not accept gifts or
gratuities from an individual organization with a value in excess of
Ten Dollars ($10.00) per year. The provisions of this section shall
not be construed to prevent the mem bers of the Board from attending
educational seminars, conferences, meetings or similar fun ctions.
SECTION 2. REPEALER 74 O.S. 2021, Section 1329.1, is
hereby repealed.
SECTION 3. REPEALER 74 O.S. 2021, Sections 1381, 1382,
1383, and 1384, are hereby repealed.
SECTION 4. This act shall become effective November 1, 2024.
59-2-9486 TJ 01/12/24