Senate Bill 2224c1

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    Florida Senate - 1999                           CS for SB 2224

    By the Committee on Governmental Oversight and Productivity;
    and Senator Thomas




    302-1967-99

  1                      A bill to be entitled

  2         An act relating to the State Group Insurance

  3         Program; amending s. 20.22, F.S.; clarifying

  4         provisions relating to operation of the

  5         Division of State Group Insurance; modifying

  6         the role of the director of the Division of

  7         State Group Insurance and staff thereof with

  8         respect to the Florida State Group Insurance

  9         Council; amending s. 110.123, F.S.; revising

10         and adding definitions; providing for Career

11         Service exemptions in the Division of State

12         Group Insurance; clarifying and correcting

13         references; clarifying requirements for

14         contracting with health maintenance

15         organizations; deleting authority to negotiate

16         with specialty psychiatric hospitals; providing

17         for the establishment of a comprehensive

18         package of insurance benefits which best suits

19         individual and family needs; updating

20         provisions relating to agency payment of

21         premiums for certain employees injured or

22         killed in the line of duty, to conform to

23         existing law; providing that state employees

24         may participate in the state group health

25         insurance program at the time of receiving

26         their retirement benefits; providing coverage

27         in the state group health insurance plan for

28         certain legislative members; amending s.

29         110.1232, F.S., relating to health insurance

30         coverage for certain state retirees; conforming

31         references; amending s. 110.1234, F.S.,

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    Florida Senate - 1999                           CS for SB 2224
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  1         relating to Medicare supplement coverage for

  2         state retirees; conforming a reference;

  3         amending s. 110.1238, F.S., relating to refunds

  4         with respect to provider overcharges; modifying

  5         the refund cap; amending s. 110.161, F.S.,

  6         relating to the State Employees Pretax Benefits

  7         Program Act; correcting references and updating

  8         provisions; amending s. 110.205, F.S.;

  9         conforming provisions to changes made by the

10         act; providing for the designation of Senior

11         Management Service positions; amending s.

12         121.025, F.S.; providing for the designation of

13         Senior Management Service positions; amending

14         s. 215.94, F.S., relating to State Group

15         Insurance; conforming references; providing an

16         effective date.

17

18  Be It Enacted by the Legislature of the State of Florida:

19

20         Section 1.  Paragraphs (a), (c), and (e) of subsection

21  (5) of section 20.22, Florida Statutes, are amended to read:

22         20.22  Department of Management Services.--There is

23  created a Department of Management Services.

24         (5)(a)  The Florida State Group Insurance Council is

25  created within the Division of State Group Insurance for the

26  purpose of providing joint and coordinated oversight of the

27  operation and administration of the state group insurance

28  program.  The council shall consist of the state budget

29  director or his or her designee; an individual from the

30  private sector with an extensive health administration

31  background, appointed by the Governor; a member of the Florida

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    Florida Senate - 1999                           CS for SB 2224
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  1  Senate, appointed by the President of the Senate; a member of

  2  the Florida House of Representatives, appointed by the Speaker

  3  of the House of Representatives; a representative of the State

  4  University System, appointed by the Board of Regents; the

  5  State Insurance Commissioner or his designee; the director of

  6  the Division of Retirement or his or her designee; and two

  7  representatives of employees and retirees, appointed by the

  8  Governor. Members of the council appointed by the Governor

  9  shall be appointed to serve terms of 4 years each.  Each

10  member of the council shall serve until a successor is

11  appointed.  Additionally, The director of the Division of

12  State Group Employee Insurance shall not be a nonvoting member

13  of the council but shall assume responsibility for ensuring

14  the provision of administrative, analytical, and technical

15  support to the council.

16         (c)  The council is assigned to the Division of State

17  Group Insurance for administrative and fiscal accountability

18  purposes, but the council and its staff shall otherwise

19  function independently of the control and direction of the

20  division.  The division of State Group Insurance shall furnish

21  dedicated administrative and secretarial assistance to the

22  council, and other assistance to the council as requested.

23         (e)  The council or a member thereof may not enter into

24  the day-to-day operation of the Division of State Group

25  Insurance and is specifically prohibited from taking part in:

26         1.  The awarding or termination of contracts.

27         2.  The selection of a consultant or contractor or the

28  prequalification of any individual consultant or contractor.

29  However, the council may recommend to the director standards

30  and policies governing the procedure for selection and

31  prequalification of consultants and contractors.

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  1         3.  The employment, promotion, demotion, suspension,

  2  transfer, or discharge of any division personnel.

  3         4.  The granting, denial, suspension, or revocation of

  4  any license or permit issued by the division.

  5         Section 2.  Subsection (2), paragraphs (a), (e), and

  6  (h) of subsection (3), paragraphs (a) and (e) of subsection

  7  (4), and subsections (5), (8), and (9) of section 110.123,

  8  Florida Statutes, 1998 Supplement, are amended, and paragraph

  9  (h) is added to subsection (4) of that section, to read:

10         110.123  State group insurance program.--

11         (2)  DEFINITIONS.--As used in this section, the term:

12         (a)  "Department" means the Department of Management

13  Services.

14         (b)  "Division" means the Division of State Group

15  Insurance in the department.

16         (c)  "Enrollee" means all state officers and employees,

17  retired state officers and employees, and surviving spouses of

18  deceased state officers and employees, and terminated

19  employees or individuals with continuation coverage who are

20  enrolled in an insurance plan offered by the state group

21  insurance program.

22         (d)  "Full-time state employees" includes all full-time

23  employees of all branches or agencies of state government

24  holding salaried positions and paid by state warrant or from

25  agency funds, and employees paid from regular salary

26  appropriations for 8 months' employment, including university

27  personnel on academic contracts, but in no case shall "state

28  employee" or "salaried position" include persons paid from

29  other-personal-services (OPS) funds.

30         (e)  "Health maintenance organization" or "HMO" means

31  an entity certified under part I of chapter 641.

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  1         (f)  "Health plan member" means any person

  2  participating in the state group health insurance plan or in a

  3  health maintenance organization plan under the state group

  4  insurance program, including enrollees and covered dependents

  5  thereof.

  6         (g)(f)  "Part-time state employee" means any employee

  7  of any branch or agency of state government paid by state

  8  warrant from salary appropriations or from agency funds, and

  9  who is employed for less than the normal full-time workweek

10  established by the department or, if on academic contract or

11  seasonal or other type of employment which is less than

12  year-round, is employed for less than 8 months during any

13  12-month period, but in no case shall "part-time" employee

14  include a person paid from other-personal-services (OPS)

15  funds.

16         (h)(g)  "Retired state officer or employee" or

17  "retiree" means any state officer or state employee who

18  retires under a state retirement system or a state optional

19  annuity or retirement program or is placed on disability

20  retirement, and who was insured under the state group

21  insurance program at the time of retirement, and who begins

22  receiving retirement benefits immediately after retirement

23  from state office or employment.

24         (i)(h)  "State agency" or "agency" means any branch,

25  department, or agency of state government.

26         (j)  "State-contracted HMO" means any health

27  maintenance organization under contract with the division to

28  participate in the state group insurance program.

29         (k)(i)  "State group health insurance plan" or "state

30  plan" means the state self-insured health insurance plan

31  offered to state officers and employees, retired state

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  1  officers and employees, and surviving spouses of deceased

  2  state officers and employees pursuant to this section.

  3         (l)(j)  "State group insurance program" or "programs"

  4  means the package of insurance plans offered to state officers

  5  and employees, retired state officers and employees, and

  6  surviving spouses of deceased state officers and employees

  7  pursuant to this section, including the state group health

  8  insurance plan, health maintenance organization plans, and

  9  other plans required or authorized by this section.

10         (m)(k)  "State officer" means any constitutional state

11  officer, any elected state officer paid by state warrant, or

12  any appointed state officer who is commissioned by the

13  Governor and who is paid by state warrant.

14         (n)(l)  "Surviving spouse" means the widow or widower

15  of a deceased state officer, full-time state employee,

16  part-time state employee, or retiree if such widow or widower

17  was covered as a dependent under the state group health

18  insurance plan or a health maintenance organization plan

19  established pursuant to this section at the time of the death

20  of the deceased officer, employee, or retiree.  "Surviving

21  spouse" also means any widow or widower who is receiving or

22  eligible to receive a monthly state warrant from a state

23  retirement system as the beneficiary of a state officer,

24  full-time state employee, or retiree who died prior to July 1,

25  1979.  For the purposes of this section, any such widow or

26  widower shall cease to be a surviving spouse upon his or her

27  remarriage.

28         (3)  STATE GROUP INSURANCE PROGRAM.--

29         (a)  The Division of State Group Insurance is created

30  within the Department of Management Services, to be headed by

31  a director who shall be appointed by the Governor and

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  1  confirmed by the Senate.  The division shall be a separate

  2  budget entity, and the director shall be its agency head for

  3  all purposes.

  4         1.  The director and assistant director are exempt from

  5  the Career Service System as provided under s. 110.205(2)(i).

  6  In addition to the 20 policymaking positions allocated to the

  7  Department of Management Services, under s. 110.205(2)(m), the

  8  director, as agency head, may designate as being exempt from

  9  the Career Service System a maximum of 5 positions determined

10  by the director to have policymaking or managerial

11  responsibilities comparable to such positions.

12         2.  The Department of Management Services shall provide

13  administrative support and service to the division to the

14  extent requested by the director. The division shall not be

15  subject to control, supervision, or direction by the

16  Department of Management Services in any manner, including,

17  but not limited to, personnel, purchasing, transactions

18  involving real or personal property, and budgetary matters,

19  except to the extent as provided in this chapter and chapters

20  216, 255, 282, and 287 for agencies of the executive branch.

21         (e)1.  Notwithstanding the provisions of chapter 287

22  and the authority of the department, for the purpose of

23  protecting the health of, and providing medical services to,

24  state employees participating in the state group insurance

25  program Employees' Health Self-Insurance Plan, the Division of

26  State Group Insurance may contract to retain the services of

27  professional administrators for the state group insurance

28  program Employees' Health Self-Insurance Plan.  The division

29  agency shall follow good purchasing practices of state

30  procurement to the extent practicable under the circumstances.

31

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  1         2.  Each vendor in a major procurement, and any other

  2  vendor if the division deems it necessary to protect the

  3  state's financial interests, shall, at the time of executing

  4  any contract with the division, post an appropriate bond with

  5  the division in an amount determined by the division to be

  6  adequate to protect the state's interests but not higher than

  7  the full amount estimated to be paid annually to the vendor

  8  under the contract.

  9         3.  Each major contract entered into by the division

10  pursuant to this section shall contain a provision for payment

11  of liquidated damages to the division for material

12  noncompliance by a vendor with a contract provision. The

13  division may require a liquidated damages provision in any

14  contract if the division deems it necessary to protect the

15  state's financial interests.

16         4.  The provisions of s. 120.57(3) apply to the

17  division's contracting process, except:

18         a.  A formal written protest of any decision, intended

19  decision, or other action subject to protest shall be filed

20  within 72 hours after receipt of notice of the decision,

21  intended decision, or other action.

22         b.  As an alternative to any provision of s. 120.57(3),

23  the division may proceed with the bid selection or contract

24  award process if the director of the division department sets

25  forth, in writing, particular facts and circumstances which

26  demonstrate the necessity of continuing the procurement

27  process or the contract award process in order to avoid a

28  substantial disruption to the provision of any scheduled

29  insurance services.

30         (h)1.  A person eligible to participate in the state

31  group health insurance program plan may be authorized by rules

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  1  adopted by the division, in lieu of participating in the state

  2  group health insurance plan, to exercise an option to elect

  3  membership in a health maintenance organization plan which is

  4  under contract with the state in accordance with criteria

  5  established by this section and by said rules.  The offer of

  6  optional membership in a health maintenance organization plan

  7  permitted by this paragraph may be limited or conditioned by

  8  rule as may be necessary to meet the requirements of state and

  9  federal laws.

10         2.  The division shall contract with health maintenance

11  organizations seeking to participate in the state group

12  insurance program through a request for proposal or other

13  procurement process, as developed by the Department of

14  Management Services and determined to be appropriate by the

15  director of the division. based upon a premium and a minimum

16  benefit package as follows:

17         a.  The division shall establish a schedule of minimum

18  benefits for health maintenance organization coverage, and

19  that schedule A minimum benefit package to be provided by a

20  participating HMO shall include: physician services; inpatient

21  and outpatient hospital services; emergency medical services,

22  including out-of-area emergency coverage; diagnostic

23  laboratory and diagnostic and therapeutic radiologic services;

24  mental health, alcohol, and chemical dependency treatment

25  services meeting the minimum requirements of state and federal

26  law; skilled nursing facilities and services; prescription

27  drugs; and other benefits as may be required by the division.

28  Additional services may be provided subject to the contract

29  between the division and the HMO.

30

31

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  1         b.  The division may establish A uniform schedule for

  2  deductibles, and copayments, or coinsurance schedules may be

  3  established for all participating HMO plans HMOs.

  4         c.  The division may require detailed information from

  5  each health maintenance organization participating in the

  6  procurement process, including information pertaining to

  7  organizational status, experience in providing pre-paid health

  8  benefits, accessibility of services, financial stability of

  9  the plan, quality of management services, accreditation

10  status, quality of medical services, network access and

11  adequacy, performance measurement, ability to meet the

12  division's reporting requirements, and the actuarial basis of

13  the proposed rates and other data determined by the director

14  to be necessary for the evaluation and selection of health

15  maintenance organization plans and negotiation of appropriate

16  rates for these plans.  Upon receipt of proposals by health

17  maintenance organization plans and the evaluation of those

18  proposals, the division may enter into negotiations with all

19  of the plans or a subset of the plans, as the division

20  determines appropriate. Based upon the minimum benefit package

21  and copayments and deductibles contained in sub-subparagraphs

22  a. and b., the division shall issue a request for proposal for

23  all HMOs which are interested in participating in the state

24  group insurance program.  Upon receipt of all proposals, the

25  division may, as it deems appropriate, enter into contract

26  negotiations with HMOs submitting bids. As part of the request

27  for proposal process, the division may require detailed

28  financial data from each HMO which participates in the bidding

29  process for the purpose of determining the financial stability

30  of the HMO.

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  1         d.  In determining which HMOs to contract with, the

  2  division shall, at a minimum, consider:  each proposed

  3  contractor's previous experience and expertise in providing

  4  prepaid health benefits; each proposed contractor's historical

  5  experience in enrolling and providing health care services to

  6  participants in the state group insurance program; the cost of

  7  the premiums; the plan's ability to adequately provide service

  8  coverage and administrative support services as determined by

  9  the division; plan benefits in addition to the minimum benefit

10  package; accessibility to providers; and the financial

11  solvency of the plan. Nothing shall preclude the division from

12  negotiating regional or statewide contracts with health

13  maintenance organization plans when this is cost-effective and

14  when the division determines that the plan offers high value

15  to enrollees has the best overall benefit package for the

16  service areas involved.  However, no HMO shall be eligible for

17  a contract if the HMO's retiree Medicare premium exceeds the

18  retiree rate as set by the division for the state group health

19  insurance plan.

20         e.  The division may limit the number of HMOs that it

21  contracts with in each service area based on the nature of the

22  bids the division receives, the number of state employees in

23  the service area, or and any unique geographical

24  characteristics of the service area. The division shall

25  establish by rule service areas throughout the state.

26         f.  All persons participating in the state group

27  insurance program who are required to contribute towards a

28  total state group health premium shall be subject to the same

29  dollar contribution regardless of whether the enrollee enrolls

30  in the state group health insurance plan or in an HMO plan.

31

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  1         3.  The division is authorized to negotiate and to

  2  contract with specialty psychiatric hospitals for mental

  3  health benefits, on a regional basis, for alcohol, drug abuse,

  4  and mental and nervous disorders. The division may establish,

  5  subject to the approval of the Legislature pursuant to

  6  subsection (5), any such regional plan upon completion of an

  7  actuarial study to determine any impact on plan benefits and

  8  premiums.

  9         3.4.  In addition to contracting pursuant to

10  subparagraph 2., the division shall enter into contract with

11  any HMO to participate in the state group insurance program

12  which:

13         a.  Serves greater than 5,000 recipients on a prepaid

14  basis under the Medicaid program;

15         b.  Does not currently meet the 25 percent

16  non-Medicare/non-Medicaid enrollment composition requirement

17  established by the Department of Health and Human Services

18  excluding participants enrolled in the state group insurance

19  program;

20         c.  Meets the minimum benefit package and copayments

21  and deductibles contained in sub-subparagraphs 2.a. and b.;

22         d.  Is willing to participate in the state group

23  insurance program at a cost of premiums that is not greater

24  than 95 percent of the cost of HMO premiums accepted by the

25  division in each service area; and

26         e.  Meets the minimum surplus requirements of s.

27  641.225.

28

29  The division is authorized to contract with HMOs that meet the

30  requirements of sub-subparagraphs a. through d. prior to the

31  open enrollment period for state employees.  The division is

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  1  not required to renew the contract with the HMOs as set forth

  2  in this paragraph more than twice. Thereafter, the HMOs shall

  3  be eligible to participate in the state group insurance

  4  program only through the request for proposal process

  5  described in subparagraph 2.

  6         4.5.  All enrollees in the state group health insurance

  7  plan or any health maintenance organization plan shall have

  8  the option of changing to any other health plan which is

  9  offered by the state within any open enrollment period

10  designated by the division. Open enrollment shall be held at

11  least once each calendar year.

12         5.6.  Any HMO participating in the state group

13  insurance program shall submit health care utilization and

14  cost data to the division, in such form and in such manner as

15  the division shall require, as a condition of participating in

16  the program. The division shall enter into negotiations with

17  its contracting HMOs to determine the nature and scope of the

18  data submission and the final requirements, format, penalties

19  associated with noncompliance, and timetables for submission.

20  These determinations shall be adopted by rule. Any HMO

21  participating in the state group insurance program shall, upon

22  the request of the division, submit to the division

23  standardized data for the purpose of comparison of the

24  appropriateness, quality, and efficiency of care provided by

25  the HMO. Such standardized data shall include:  membership

26  profiles; inpatient and outpatient utilization by age and sex,

27  type of service, provider type, and facility; and emergency

28  care experience. Requirements and timetables for submission of

29  such standardized data and such other data as the division

30  deems necessary to evaluate the performance of participating

31  HMOs shall be adopted by rule.

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  1         6.7.  The division may establish and direct, in

  2  consultation with the Department of Management Services with

  3  respect to collective bargaining issues, a comprehensive

  4  package of insurance benefits that may include, supplemental

  5  health and life coverage, dental care, long-term care, vision

  6  care, and other benefits it determines necessary to enable

  7  state employees to select from among benefit options that best

  8  suit their individual and family needs. shall, after

  9  consultation with representatives from each of the unions

10  representing state and university employees, establish a

11  comprehensive package of insurance benefits including, but not

12  limited to, supplemental health and life coverage, dental

13  care, long-term care, and vision care to allow state employees

14  the option to choose the benefit plans which best suit their

15  individual needs.

16         a.  Based upon a desired benefit package, the division

17  shall issue a request for proposal for health insurance

18  providers interested in participating in the state group

19  insurance program, and the division shall issue a request for

20  proposal for insurance providers interested in participating

21  in the non-health-related components of the state group

22  insurance program.  Upon receipt of all proposals, the

23  division may enter into contract negotiations with insurance

24  providers submitting bids or negotiate a specially designed

25  benefit package. Insurance providers offering or providing

26  supplemental coverage as of May 30, 1991, which qualify for

27  pretax benefit treatment pursuant to s. 125 of the Internal

28  Revenue Code of 1986, with 5,500 or more state employees

29  currently enrolled may be included by the division in the

30  supplemental insurance benefit plan established by the

31  division without participating in a request for proposal,

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  1  submitting bids, negotiating contracts, or negotiating a

  2  specially designed benefit package.  These contracts shall

  3  provide state employees with the most cost-effective and

  4  comprehensive coverage available; however, no state or agency

  5  funds shall be contributed toward the cost of any part of the

  6  premium of such supplemental benefit plans.

  7         b.  Pursuant to the applicable provisions of s.

  8  110.161, and s. 125 of the Internal Revenue Code of 1986, the

  9  division shall enroll in the pretax benefit program those

10  state employees who voluntarily elect coverage in any of the

11  supplemental insurance benefit plans as provided by

12  sub-subparagraph a.

13         c.  Nothing herein contained shall be construed to

14  prohibit insurance providers from continuing to provide or

15  offer supplemental benefit coverage to state employees as

16  provided under existing agency plans.

17         (4)  PAYMENT OF PREMIUMS; CONTRIBUTION BY STATE;

18  LIMITATION ON ACTIONS TO PAY AND COLLECT PREMIUMS.--

19         (a)  Except as provided in paragraph (e) with respect

20  to law enforcement officers, correctional, and correctional

21  probation officers, and firefighters, legislative

22  authorization through the appropriations act is required for

23  payment by a state agency of any part of the premium cost of

24  participation in any group insurance plan.  However, the state

25  contribution for full-time employees or part-time permanent

26  employees shall continue in the respective proportions for up

27  to 6 months for any such officer or employee who has been

28  granted an approved parental or medical leave of absence

29  without pay.

30         (e)  No state contribution for the cost of any part of

31  the premium shall be made for retirees or surviving spouses

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  1  for any type of coverage under the state group insurance

  2  program. However, any state agency that employs a full-time

  3  law enforcement officer, correctional officer, or correctional

  4  probation officer who is killed or suffers catastrophic injury

  5  in the line of duty as provided in s. 112.19, or a full-time

  6  firefighter who is killed or suffers catastrophic injury in

  7  the line of duty as provided in s. 112.191, on or after July

  8  1, 1980, as a result of an act of violence inflicted by

  9  another person while the officer is engaged in the performance

10  of law enforcement duties or as a result of an assault against

11  the officer under riot conditions shall pay the entire premium

12  of the state group health insurance plan for the employee's

13  surviving spouse until remarried, and for each dependent child

14  of the employee, subject to the conditions and limitations set

15  forth in s. 112.19 or s. 112.191, as applicable until the

16  child reaches the age of majority or until the end of the

17  calendar year in which the child reaches the age of 25 if:

18         1.  At the time of the employee's death, the child is

19  dependent upon the employee for support; and

20         2.  The surviving child continues to be a dependent for

21  support, or the surviving child is a full-time or part-time

22  student and is dependent for support.

23         (h)  State employees may participate in the state group

24  health insurance plan at the time of receiving their state

25  retirement benefits.

26         (5)  DIVISION OF STATE GROUP INSURANCE; POWERS AND

27  DUTIES.--The division is responsible for the administration of

28  the state group insurance program.  The division shall

29  initiate and supervise the program as established by this

30  section and shall adopt such rules as are necessary to perform

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  1  its responsibilities.  To implement this program, the division

  2  shall, with prior approval by the Legislature:

  3         (a)  Determine the benefits to be provided and the

  4  contributions to be required for the state group insurance

  5  program. Such determinations, whether for a contracted plan or

  6  a self-insurance plan pursuant to paragraph (c), do not

  7  constitute rules within the meaning of s. 120.52 or final

  8  orders within the meaning of s. 120.52. Any physician's fee

  9  schedule used in the health and accident plan shall not be

10  available for inspection or copying by medical providers or

11  other persons not involved in the administration of the

12  program. However, in the determination of the design of the

13  program, the division shall consider existing and

14  complementary benefits provided by the Florida Retirement

15  System and the Social Security System.

16         (b)  Prepare, in cooperation with the Department of

17  Insurance, the specifications necessary to implement the

18  program.

19         (c)  Contract on a competitive proposal basis with an

20  insurance carrier or carriers, or professional administrator,

21  determined by the Department of Insurance to be fully

22  qualified, financially sound, and capable of meeting all

23  servicing requirements.  Alternatively, the division may

24  self-insure any plan or plans contained in the state group

25  insurance program subject to approval based on actuarial

26  soundness by the Department of Insurance.  The division may

27  contract with an insurance company or professional

28  administrator qualified and approved by the Department of

29  Insurance to administer such plan. Before entering into any

30  contract, the division shall advertise for competitive

31  proposals, and such contract shall be let upon the

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  1  consideration of the benefits provided in relationship to the

  2  cost of such benefits. In determining which entity to contract

  3  with, the division shall, at a minimum, consider:  the

  4  entity's previous experience and expertise in administering

  5  group insurance programs of the type it proposes to

  6  administer; the entity's ability to specifically perform its

  7  contractual obligations in this state and other governmental

  8  jurisdictions; the entity's anticipated administrative costs

  9  and claims experience; the entity's capability to adequately

10  provide service coverage and sufficient number of experienced

11  and qualified personnel in the areas of claims processing,

12  recordkeeping, and underwriting, as determined by the

13  division; the entity's accessibility to state employees and

14  providers; the financial solvency of the entity, using

15  accepted business sector measures of financial performance.

16  The division may contract for medical services which will

17  improve the health or reduce medical costs for employees who

18  participate in the state group insurance plan.

19         (d)  With respect to the state group health insurance

20  plan, be authorized to require copayments with respect to all

21  providers under the plan.

22         (e)  Have authority to establish a voluntary program

23  for comprehensive health maintenance, which may include health

24  educational components and health appraisals.

25         (f)  With respect to any contract with an insurance

26  carrier or carriers or professional administrator entered into

27  by the division, require that the state and the enrollees be

28  held harmless and indemnified for any financial loss caused by

29  the failure of the insurance carrier or professional

30  administrator to comply with the terms of the contract.

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  1         (g)  With respect to any contract with an insurance

  2  carrier or carriers, or professional administrator entered

  3  into by the division, require that the carrier or professional

  4  administrator provide written notice to individual enrollees

  5  if any payment due to any health care provider of the enrollee

  6  remains unpaid beyond a period of time as specified in the

  7  contract.

  8         (h)  Have authority to establish a voluntary group

  9  long-term care program or other programs to be funded on a

10  pretax contribution basis or on a posttax contribution basis,

11  as the division determines.

12         (i)  Beginning November 1, 1998, and for the 1998-1999

13  fiscal year only, continue to process health insurance claims

14  for the 1996 and 1997 calendar years, subject to the review

15  and approval process provided in s. 216.177. This paragraph is

16  repealed on July 1, 1999.

17

18  Final decisions concerning enrollment, the existence of

19  coverage, or covered benefits under the state group health

20  insurance program plan shall not be delegated or deemed to

21  have been delegated by the division.

22         (8)  COVERAGE FOR LEGISLATIVE MEMBERS AND EMPLOYEES.--

23         (a)  The Legislature may provide coverage for its

24  members and employees under all or any part of the state group

25  insurance program; may provide coverage for its members and

26  employees under a legislative group insurance program in lieu

27  of all or any part of the state group insurance program; and,

28  notwithstanding the provisions of paragraph (4)(c), may assume

29  the cost of any group insurance coverage provided to its

30  members and employees.

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  1         (b)  Effective July 1, 1999, any legislative member who

  2  terminates his or her elected service after July 1, 1999,

  3  after having vested in the state retirement system, may

  4  purchase coverage in the state group health insurance plan at

  5  the same premium cost as that for retirees and surviving

  6  spouses. Such legislators may also elect to continue coverage

  7  under the group term life insurance program prevailing for

  8  current members at the premium cost in effect for that plan.

  9         (9)  PUBLIC RECORDS LAW; EXEMPTION.--Patient medical

10  records and medical claims records of state employees, former

11  state employees, and their eligible covered dependents in the

12  custody or control of the state group insurance program are

13  confidential and exempt from the provisions of s. 119.07(1).

14  Such records shall not be furnished to any person other than

15  the affected state employee or former state employee or his or

16  her the employee's legal representative, except upon written

17  authorization of the employee or former state employee, but

18  may be furnished in any civil or criminal action, unless

19  otherwise prohibited by law, upon the issuance of a subpoena

20  from a court of competent jurisdiction and proper notice to

21  the state employee, former state employee, or his or her the

22  employee's legal representative by the party seeking such

23  records.

24         Section 3.  Section 110.1232, Florida Statutes, is

25  amended to read:

26         110.1232  Health insurance coverage for persons retired

27  under state-administered retirement systems before January 1,

28  1976, and for spouses.--Notwithstanding any provisions of law

29  to the contrary, the Division of State Group Insurance shall

30  provide health insurance coverage under in the state group

31  Health insurance program Plan for persons who retired before

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  1  prior to January 1, 1976, under any of the state-administered

  2  retirement systems and who are not covered by social security

  3  and for the spouses and surviving spouses of such retirees who

  4  are also not covered by social security.  Such health

  5  insurance coverage shall provide the same benefits as provided

  6  to other retirees who are entitled to participate under s.

  7  110.123. The claims experience of this group shall be

  8  commingled with the claims experience of other members covered

  9  under s. 110.123.

10         Section 4.  Subsection (1) of section 110.1234, Florida

11  Statutes, is amended to read:

12         110.1234  Health insurance for retirees under the

13  Florida Retirement System; Medicare supplement and fully

14  insured coverage.--

15         (1)  The Division of State Group Insurance shall

16  solicit competitive bids from state-licensed insurance

17  companies to provide and administer a fully insured Medicare

18  supplement policy for all eligible retirees of a state or

19  local public employer. Such Medicare supplement policy shall

20  meet the provisions of ss. 627.671-627.675.  For the purpose

21  of this subsection, "eligible retiree" means any public

22  employee who retired from a state or local public employer who

23  is covered by Medicare, Parts A and B. The division department

24  shall authorize one company to offer the Medicare supplement

25  coverage to all eligible retirees. All premiums shall be paid

26  by the retiree.

27         Section 5.  Section 110.1238, Florida Statutes, is

28  amended to read:

29         110.1238  State group health insurance plans; refunds

30  with respect to overcharges by providers.--A participant in a

31  state group health insurance plan who discovers that he or she

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  1  was overcharged by a health care provider shall receive a

  2  refund of 50 percent of any amount recovered as a result of

  3  such overcharge, up to a maximum of $1,000 per admission.

  4         Section 6.  Subsections (5), (6), and (7) of section

  5  110.161, Florida Statutes, are amended to read:

  6         110.161  State employees; pretax benefits program.--

  7         (5)  The Division of State Group Insurance shall

  8  develop rules for the pretax benefits program, which shall

  9  specify the benefits to be offered under the program, the

10  continuing tax-exempt status of the program, and any other

11  matters deemed necessary by the division department to

12  implement this section. The rules must be approved by a

13  majority vote of the Administration Commission.

14         (6)  The Division of State Group Insurance is

15  authorized to administer the establish a pretax benefits

16  program established for all employees so that whereby

17  employees may would receive benefits that which are not

18  includable in gross income under the Internal Revenue Code of

19  1986.  The pretax benefits program: shall be implemented in

20  phases.

21         (a)  Phase one Shall allow employee contributions to

22  premiums for the state group insurance health program

23  administered under s. 110.123 and state life insurance to be

24  paid on a pretax basis unless an employee elects not to

25  participate.

26         (b)  Phase two Shall allow employees to voluntarily

27  establish expense reimbursement plans from their salaries on a

28  pretax basis to pay for qualified medical and dependent care

29  expenses, including premiums paid by employees for qualified

30  supplemental insurance.

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  1         (c)  Phase two May also provide for the payment of such

  2  premiums through a pretax payroll procedure as used in phase

  3  one.  The Administration Commission and the Division of State

  4  Group Insurance are directed to take all actions necessary to

  5  preserve the tax-exempt status of the program.

  6         (7)  The Legislature recognizes that a substantial

  7  amount of the employer savings realized by the implementation

  8  of a pretax benefits program will be the result of diminutions

  9  in the state's employer contribution to the Federal Insurance

10  Contributions Act tax. There is hereby created the Pretax

11  Benefits Trust Fund in the Division of State Group Insurance.

12  Each agency shall transfer to the Pretax Benefits Trust Fund

13  the employer FICA contributions saved by the state as a result

14  of the implementation of the pretax benefits program

15  authorized pursuant to this section. Any moneys forfeited

16  pursuant to employees' salary reduction agreements to

17  participate in phase one or phase two of the program must also

18  be deposited in the Pretax Benefits Trust Fund. Moneys in the

19  Pretax Benefits Trust Fund shall be used for the pretax

20  benefits program, including its administration by the Division

21  of State Group Insurance Department of Management Services or

22  a third-party administrator.

23         Section 7.  Paragraph (i) of subsection (2) of section

24  110.205, Florida Statutes, is amended to read:

25         110.205  Career service; exemptions.--

26         (2)  EXEMPT POSITIONS.--The exempt positions which are

27  not covered by this part include the following, provided that

28  no position, except for positions established for a limited

29  period of time pursuant to paragraph (h), shall be exempted if

30  the position reports to a position in the career service:

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  1         (i)  The appointed secretaries, assistant secretaries,

  2  deputy secretaries, and deputy assistant secretaries of all

  3  departments; the executive directors, assistant executive

  4  directors, deputy executive directors, and deputy assistant

  5  executive directors of all departments; and the directors of

  6  all divisions and those positions determined by the department

  7  to have managerial responsibilities comparable to such

  8  positions, which positions include, but are not limited to,

  9  program directors, assistant program directors, district

10  administrators, deputy district administrators, the Director

11  of Central Operations Services of the Department of Children

12  Health and Family Rehabilitative Services, the assistant

13  director of the Division of State Group Insurance, and the

14  assistant director of the Division of Retirement of the

15  Department of Management Services, and the State

16  Transportation Planner, State Highway Engineer, State Public

17  Transportation Administrator, district secretaries, district

18  directors of planning and programming, production, and

19  operations, and the managers of the offices specified in s.

20  20.23(3)(d)2., of the Department of Transportation.  Unless

21  otherwise fixed by law, the department shall set the salary

22  and benefits of these positions in accordance with the rules

23  of the Senior Management Service.

24         Section 8.  Section 121.025, Florida Statutes, is

25  amended to read:

26         121.025  Administrator; powers and duties.--The

27  director of the Division of Retirement shall be the

28  administrator of the retirement and pension systems assigned

29  or transferred to the Division of Retirement by law and shall

30  have the authority to sign the contracts necessary to carry

31  out the duties and responsibilities assigned by law to the

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  1  Division of Retirement. The director and assistant director

  2  shall be exempt from the Career Service System as provided

  3  under s. 110.205(2)(i) of the state personnel law.  In

  4  addition to the 20 policymaking positions allocated to the

  5  Department of Management Services under s. 110.205(2)(m), the

  6  director, as agency head, may designate as being exempt from

  7  the Career Service System a maximum of 5 positions determined

  8  by the director to have policymaking or managerial

  9  responsibilities comparable to such positions.

10         Section 9.  Paragraph (a) of subsection (5) of section

11  215.94, Florida Statutes, is amended to read:

12         215.94  Designation, duties, and responsibilities of

13  functional owners.--

14         (5)  The Department of Management Services shall be the

15  functional owner of the Cooperative Personnel Employment

16  Subsystem.  The department shall design, implement, and

17  operate the subsystem in accordance with the provisions of ss.

18  110.116 and 215.90-215.96.  The subsystem shall include, but

19  shall not be limited to, functions for:

20         (a)  Maintenance of employee and position data,

21  including funding sources and percentages and salary lapse.

22  The employee data shall include, but not be limited to,

23  information to meet the payroll system requirements of the

24  Department of Banking and Finance and to meet the employee

25  benefit system requirements of the Division of State Group

26  Employees Insurance in the Department of Management Services.

27         Section 10.  This act shall take effect July 1, 1999.

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29

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  1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
  2                             SB 2224

  3

  4  The Committee Substitute removes provisions transferring the
    establishment of prescription drug co-payments from general
  5  law to the appropriations act. It also reduces from 10 to 5
    the number of additional exempt positions which can be
  6  designated by the Division of State Group Insurance and the
    Division of Retirement each.
  7

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