38-654

38-654. Special employee health insurance trust
fund; purpose; investment of monies; use of monies; exemption from
lapsing; annual report

A. There is established a special employee health insurance trust fund for the
purpose of administering the state employee health insurance benefit plans. The fund
shall consist of legislative appropriations, monies collected from the employer and
employees for the health insurance benefit plans and investment earnings on monies
collected from employees. The fund shall be administered by the director of the
department of administration. Monies in the fund that are determined by the legislature
to be for administrative expenses of the department of administration, including monies
authorized by subsection D, paragraph 4 of this section, are subject to legislative
appropriation.

B. On notice from the department of administration, the state treasurer shall
invest and divest monies in the fund as provided by section 35-313, and monies earned
from investment shall be credited to the fund. There shall be a separate accounting of
monies contributed by the employer, monies collected from state employees and investment
earnings on monies collected from employees. Monies collected from state employees for
health insurance benefit plans shall be expended prior to expenditure of monies
contributed by the employer.

C. The director of the department of administration may authorize the employer
health insurance contributions by fund to be payable in advance whether the budget unit
is funded in whole or in part by state monies. By July 15 each year, the joint
legislative budget committee staff shall determine the amount appropriated for employer
health insurance contributions. The department of administration may transfer to the
special employee health insurance trust fund in whole or in part the amount appropriated
to budget units for employer health insurance contributions as deemed necessary.

D. Monies in the fund shall be used by the department of administration for the
following purposes for the benefit of officers and employees who participate in a health
insurance benefit plan pursuant to this article:

1. To administer a health insurance benefit program for state officers and
employees.

2. To pay health insurance premiums, claims costs and related administrative
expenses.

3. To apply against future premiums, claims costs and related administrative
expenses.

4. To apply the equivalent of not more than one dollar fifty cents for each
employee for each month to administer applicable federal and state laws relating to
health insurance benefit programs and to design, implement and administer improvements to
the employee health insurance or benefit program.

E. Subsection D of this section shall not be construed to require that all monies
in the special employee health insurance trust fund shall be used within any one or more
fiscal years. Any person who is no longer a state employee or an employee who is no
longer a participant in a health insurance plan under contract with the department of
administration shall have no claim upon monies in the fund.

F. Monies deposited in or credited to the fund are exempt from the provisions of
section 35-190 relating to lapsing of appropriations.

G. Claims for services rendered prior to July 1, 1989 shall not be paid from the
special employee health insurance trust fund.

H. The department of administration shall submit an annual report on the financial
status of the special employee insurance trust fund to the governor, the president of the
senate, the speaker of the house of representatives, the chairpersons of the house and
senate appropriations committees and the joint legislative budget committee staff by
March 1. The report shall include:

1. The actuarial assumptions and a description of the methodology used to set
premiums and reserve balance targets for the health insurance benefit program for the
current plan year.

2. An analysis of the actuarial soundness of the health insurance benefit program
for the previous plan year.

3. An analysis of the actuarial soundness of the health insurance benefit program
for the current plan year, based on both year-to-date experience and total expected
experience.

4. A preliminary estimate of the premiums and reserve balance targets for the next
plan year, including the actuarial assumptions and a description of the methodology used.

I. The department shall submit a report to the joint legislative budget committee
detailing any changes to the type of benefits offered under the plan and associated costs
at least forty-five days before making the change. The report shall include:

1. An estimate of the cost or saving associated with the change.

2. An explanation of why the change was implemented before the next plan year.