AN ACT relating to reemployment of retired police officers.

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AN ACT relating to reemployment of retired police officers. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
Section 1. KRS 70.292 is amended to read as follows: 3
(1) A county police department or county sheriff's office in the Commonwealth of 4
Kentucky may employ police officers who have retired under the State Police 5
Retirement System, Kentucky Employees Retirement System, or the County 6
Employees Retirement System as provided by KRS 70.291 to 70.293. 7
(2) An individual employed under KRS 70.291 to 70.293 shall have: 8
(a) 1. Participated in the Law Enforcement Foundation Program fund under 9
KRS 15.410 to 15.515; or 10
2. Retired as a commissioned officer pursuant to KRS Chapter 16; 11
(b) Retired with at least twenty (20) years of service credit; 12
(c) Been separated from service for the period required by KRS 61.637 and 13
78.5540 so that the member's retirement is not voided; 14
(d) Retired with no administrative charges pending; and 15
(e) Retired with no pre-existing agreement between the individual and the c ounty 16
police department or the sheriff's office prior to the individual's retirement for 17
the individual to return to work for the county police department or the 18
sheriff's office. 19
Section 2. KRS 70.293 is amended to read as follows: 20
(1) Individuals employed under KRS 70.291 to 70.293 shall: 21
(a) Serve for a term not to exceed one (1) year. The one (1) year employment 22
term may be renewed annually at the discretion of the employing county 23
police department or sheriff's office; 24
(b) Receive compensation according to the standard procedures applicable to the 25
employing county police department or sheriff's office; and 26
(c) Be employed based upon need as determined by the county police department 27
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or the employing sheriff's office. 1
(2) Notwithstanding any provisions of KRS 16.505 to 16.652, 18A.225 to 18A.2287, 2
61.510 to 61.705, or 78.510 to 78.852 to the contrary: 3
(a) Individuals employed under KRS 70.291 to 70.293 shall continue to receive 4
all retirement and health insurance benefi ts to which they were entitled upon 5
retiring in the applicable system administered by Kentucky Retirement 6
Systems or the County Employees Retirement System; 7
(b) Except as provided in paragraph (e) of this subsection, individuals employed 8
under KRS 70.291 t o 70.293 shall not be eligible to receive health insurance 9
coverage through the county police department, the sheriff's office, or the 10
fiscal court of the county police department or sheriff's office; 11
(c) The county police department, sheriff's office, or fiscal court of the county 12
police department or sheriff's office shall not pay any employer contributions 13
or retiree health expense reimbursements to the Kentucky Retirement Systems 14
required by KRS 61.637(17) or 78.5540(4) for individuals employed under 15
KRS 70.291 to 70.293; [and] 16
(d) Except as provided in paragraph (e) of this subsection, the county police 17
department, sheriff's office, or fiscal court of the county police department or 18
sheriff's office shall not pay any insurance contributions to the state health 19
insurance plan, as provided by KRS 18A.225 to 18A.2287, for individuals 20
employed under KRS 70.291 to 70.293; and 21
(e) Effective August 1, 2026, the chief legislative body of the county, urban -22
county, or consolidated local government who is responsib le for approving 23
the budget of the sheriff's office or sheriff's department may by legislative 24
action provide or authorize provision of health insurance coverage for 25
individuals employed under KRS 70.291 to 70.293, subject to the terms and 26
conditions estab lished by the chief governing body of the county, urban -27
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county, or consolidated local government. 1
(3) Individuals employed under KRS 70.291 to 70.293 shall be subject to any merit 2
system, civil service, or other legislative due process provisions applicabl e to the 3
county police department or sheriff's office. A decision not to renew a one (1) year 4
appointment term under this section shall not be considered a disciplinary action or 5
deprivation subject to due process. 6
Section 3. KRS 95.022 is amended to read as follows: 7
(1) As used in this section: 8
(a) "City" means any incorporated city, consolidated local government, unified 9
local government, urban -county government, or charter county government, 10
operating under the law of this Commonwealth, and the offices and agencies 11
thereof; and 12
(b) "Police officer" has the same meaning as "police officer" in KRS 15.420 and 13
as "officer" in KRS 16.010. 14
(2) Subject to the limitations of subsection (7) of this section, a city may employ 15
individuals as police officers under this section who have retired from the Kentucky 16
Employees Retirement System, the County Employees Retirement System, or the 17
State Police Retirement System. 18
(3) To be eligible for employment under this section, an individual shall have: 19
(a) Participated in the Law Enforcement Foundation Program fund under KRS 20
15.410 to 15.510 or retired as a commissioned officer pursuant to KRS 21
Chapter 16; 22
(b) Retired with at least twenty (20) years of service credit; 23
(c) Been separated from service for the period required by KRS 61.637 and 24
78.5540 so that the member's retirement is not voided; 25
(d) Retired with no administrative charges pending; and 26
(e) Retired with no preexisting agreement between the individual and the ci ty 27
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prior to the individual's retirement for the individual to return to work for the 1
city. 2
(4) Individuals employed under this section shall: 3
(a) Serve for a term not to exceed one (1) year. The one (1) year employment 4
term may be renewed annually at the discretion of the employing city; 5
(b) Receive compensation according to the standard procedures applicable to the 6
employing city; and 7
(c) Be employed based upon need as determined by the employing city. 8
(5) Notwithstanding any provisions of KRS 16.505 to 16 .652, 18A.225 to 18A.2287, 9
61.510 to 61.705, or 78.510 to 78.852 to the contrary: 10
(a) Individuals employed under this section shall continue to receive all 11
retirement and health insurance benefits to which they were entitled upon 12
retiring in the applicable system administered by Kentucky Retirement 13
Systems or the County Employees Retirement System; 14
(b) Except as provided in paragraph (e) of this subsection, individuals employed 15
under this section shall not be eligible to receive health insurance coverage 16
through the employing city; 17
(c) The city shall not pay any employer contributions or retiree health expense 18
reimbursements to the Kentucky Retirement Systems required by KRS 19
61.637(17) or 78.5540(4) for individuals employed under this section;[ and] 20
(d) Except as provided in paragraph (e) of this subsection, the city shall not pay 21
any insurance contributions to the state health insurance plan, as provided by 22
KRS 18A.225 to 18A.2287, for individuals employed under this section; and 23
(e) Effective August 1, 2026 , the legislative body of the city may by legislative 24
action provide or authorize provision of health insurance coverage for 25
individuals employed under this section, subject to the terms and conditions 26
established by the city. 27
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(6) Individuals employed unde r this section shall be subject to any merit system, civil 1
service, or other legislative due process provisions applicable to the employing city. 2
A decision not to renew a one (1) year appointment term under this section shall not 3
be considered a disciplinary action or deprivation subject to due process. 4
(7) A city government shall be limited in the number of retired police officers that it 5
may hire under this section as follows: 6
(a) A city government that employed an average of five (5) or fewer police 7
officers over the course of the immediately preceding calendar year shall not 8
be limited in the number of officers that they may hire under this section; 9
(b) A city government that employed an average of more than five (5) but fewer 10
than one hundred (100) pol ice officers over the course of the immediately 11
preceding calendar year shall not hire more than five (5) police officers or a 12
number equal to twenty-five percent (25%) of the police officers employed by 13
the city in the immediately preceding calendar year, whichever is greater; and 14
(c) A city government that employed an average of one hundred (100) or more 15
police officers over the course of the immediately preceding calendar year 16
[2015 ]shall not hire more than twenty -five (25) police officers or a number 17
equal to ten percent (10%) of the police officers employed by the city in the 18
immediately preceding calendar year, whichever is greater. 19
(8) Retired police officers employed by a city government for purposes of KRS 20
158.4414 shall not apply against the limit ations provided by subsection (7) of this 21
section. 22
Section 4. KRS 164.952 is amended to read as follows: 23
(1) As used in this section: 24
(a) "Police officer" has the same meaning as "police officer" in KRS 15.420, as 25
"police officer" in KRS 164.950 to 164.980, and as "officer" in KRS 16.010; 26
and 27
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(b) "Postsecondary institution" means any public institution of postsecondary 1
education authorized to establish a police department pursuant to KRS 2
164.950 to 164.980 that participat es in the Kentucky Employees Retirement 3
System. 4
(2) A postsecondary institution may employ individuals as police officers under this 5
section who have retired from the Kentucky Employees Retirement System, the 6
County Employees Retirement System, or the State Police Retirement System. 7
(3) To be eligible for employment under this section, an individual shall have: 8
(a) Participated in the Law Enforcement Foundation Program fund under KRS 9
15.410 to 15.510, retired as a commissioned officer pursuant to KRS Chapte r 10
16, or retired as a police officer from a postsecondary institution; 11
(b) Retired with at least twenty (20) years of service credit; 12
(c) Been separated from service for the period required by KRS 61.637 and[or] 13
78.5540 so that the member's retirement is not voided; 14
(d) Retired with no administrative charges pending; and 15
(e) Retired with no preexisting agreement between the individual and the 16
postsecondary institution prior to the individual's retirement for the individual 17
to return to work for the postsecondary institution. 18
(4) Individuals employed under this section shall: 19
(a) Serve for a term not to exceed one (1) year. The one (1) year employment 20
term may be renewed annually at the discretion of the employing 21
postsecondary institution; 22
(b) Receive compensation according to the standard procedures applicable to the 23
employing postsecondary institution; and 24
(c) Be employed based upon need as determined by the employing postsecondary 25
institution. 26
(5) Notwithstanding any provisions of KRS 16.505 to 16.652, 18A.225 to 18A.2287, 27
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61.510 to 61.705, or 78.510 to 78.852 to the contrary: 1
(a) Individuals employed under this section shall continue to receive all 2
retirement and health insurance benefits to which they were entitled upon 3
retiring in the applicable system administered by Kentucky Retirement 4
Systems; 5
(b) Except as provided in paragraph (e) of this subsection, individuals employed 6
under this section shall not be eligible to receive health insurance coverage 7
through the employing postsecondary institution; 8
(c) The postsecondary institution shall not pay any employer contributions or 9
retiree health expense reimbursements to the Kentucky Retirement Systems 10
required by KRS 61.637(17) or 78.5540(4) for individuals employed under 11
this section;[ and] 12
(d) Except as provided in paragraph (e) of this subsection, the postsecondary 13
institution shall not pay any insurance contributions to the state health 14
insurance plan, as provided by KRS 18A.225 to 18A.2287, for individuals 15
employed under this section; and 16
(e) Effective August 1, 2026, the governing body of the po stsecondary 17
institution may by action of the governing body provide or authorize 18
provision of health insurance coverage for individuals employed under this 19
section, subject to the terms and conditions established by the postsecondary 20
institution. 21
(6) Individuals employed under this section shall be subject to any legislative due 22
process provisions applicable to police officers of the employing postsecondary 23
institution. A decision not to renew a one (1) year appointment term under this 24
section shall not be considered a disciplinary action or deprivation subject to due 25
process. 26
Section 5. KRS 61.702 is amended to read as follows: 27
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(1) For purposes of this section: 1
(a) "Hospital and medical insurance plan" may include, at the board's discretion, 2
any one (1) or more of the following: 3
1. Any hospital and medical expense policy or certificate, provider -4
sponsored integrated health delivery network, self -insured medical plan, 5
health maintenance organization contract, or other health benefit plan; 6
2. Any health savings account as permitted by 26 U.S.C. sec. 223 or health 7
reimbursement arrangement or a similar account as may be permitted by 8
26 U.S.C. sec. 105 or 106. Such arrangement or account, at the board's 9
discretion, may reimburs e any medical expense permissible under 26 10
U.S.C. sec. 213; or 11
3. A medical insurance reimbursement program established by the board 12
through the promulgation of administrative regulation under which 13
members purchase individual health insurance coverage through a health 14
insurance exchange established under 42 U.S.C. sec. 18031 or 18041; 15
(b) "Monthly contribution rate" is the amount determined by the board based 16
upon the requirements of subsection (4)(a) to (d) of this section, except that 17
for members who beg an participating in the system on or after July 1, 2003, 18
the term shall mean the amount determined in subsection (4)(e) of this 19
section; and 20
(c) "Months of service" means the total months of combined service used to 21
determine benefits under the system, exc ept service added to determine 22
disability benefits or service otherwise prohibited from being used to 23
determine retiree health benefits under KRS 16.505 to 16.652 or 61.510 to 24
61.705 shall not be counted as "months of service." For current and former 25
employees of the Council on Postsecondary Education who were employed 26
prior to January 1, 1993, and who earn at least fifteen (15) years of service 27
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credit in the Kentucky Employees Retirement System, "months of service" 1
shall also include vested service in anot her retirement system other than the 2
Kentucky Teachers' Retirement System sponsored by the Council on 3
Postsecondary Education. 4
(2) (a) 1. The board of trustees of the system shall arrange by appropriate contract 5
or on a self -insured basis to provide a grou p hospital and medical 6
insurance plan coverage for: 7
a. Present and future recipients of a retirement allowance from the 8
Kentucky Employees Retirement System and the State Police 9
Retirement System; and 10
b. The spouse and each qualified dependent of a recipi ent who is a 11
former member or the beneficiary, provided the spouse and 12
dependent meet the requirements to participate in the hospital and 13
medical insurance plans established, contracted, or authorized by 14
the system. 15
2. Any recipient who chooses coverage un der a hospital and medical 16
insurance plan shall pay, by payroll deduction from the retirement 17
allowance, electronic funds transfer, or by another method, the 18
difference between the premium cost of the hospital and medical 19
insurance plan coverage selected a nd the monthly contribution rate to 20
which he or she would be entitled under this section. 21
(b) 1. For present and future recipients of a retirement allowance fro m the 22
system who are not eligible for Medicare and for those recipients 23
described in subparagraph 3.b. of this paragraph, the board may 24
authorize these participants to be included in the Kentucky Employees 25
Health Plan as provided by KRS 18A.225 to 18A.2287 and shall provide 26
benefits for recipients in the plan equal to those provided to state 27
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employees having the same Medicare hospital and medical insurance 1
eligibility status. Notwithstanding the provisions of any other statute 2
except subparagraph 3.b. of th is paragraph, system recipients shall be 3
included in the same class as current state employees for purposes of 4
determining medical insurance policies and premiums in the Kentucky 5
Employees Health Plan as provided by KRS 18A.225 to 18A.2287. 6
2. Regardless of age, if a recipient or the spouse or dependent child of a 7
recipient who elects coverage becomes eligible for Medicare, he or she 8
shall participate in the plans offered by the systems for Medicare 9
eligible recipients. Individuals participating in the Medi care eligible 10
plans may be required to obtain and pay for Medicare Part A and Part B 11
coverage, in order to participate in the Medicare eligible plans offered 12
by the system. 13
3. The system shall continue to provide the same hospital and medical 14
insurance pla n coverage for recipients and qualifying dependents after 15
the age of sixty-five (65) as before the age of sixty-five (65), if: 16
a. The recipient is not eligible for Medicare coverage; or 17
b. The recipient would otherwise be eligible for Medicare coverage 18
but is subject to the Medicare Secondary Payer Act under 42 19
U.S.C. sec. 1395y(b) and has been reemployed by a participating 20
agency which offers the recipient a hospital and medical insurance 21
benefit or by a participating agency which is prevented from 22
offering or which does not offer a hospital and medical benefit to 23
the recipient as a condition of reemployment under KRS 70.293, 24
95.022, or 164.952. Individuals who are eligible, pursuant to this 25
subdivision, to be included in the Kentucky Employees Health 26
Plan as provided by KRS 18A.225 to 18A.2287 may be rated as a 27
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separate class from other eligible employees and retirees for the 1
purpose of determining medical insurance premiums. 2
(c) For recipients of a retirement allowance who are not eligible for the same 3
level of hospital and medical benefits as recipients living in Kentucky having 4
the same Medicare hospital and medical insurance eligibility status, the board 5
shall provide a medical insurance reimbursement plan as described in 6
subsection (6) of this section. 7
(d) Notwithstanding anything in KRS Chapter 16 or 61 to the contrary, the board 8
of trustees, in its discretion, may take necessary steps to ensure compliance 9
with 42 U.S.C. sec.[secs.] 300bb-1 et seq. 10
(3) (a) Each employer participating in the Kentucky Emp loyees Retirement System 11
or the State Police Retirement System as provided in KRS 16.505 to 16.652 or 12
61.510 to 61.705 shall contribute to the insurance trust fund established under 13
KRS 61.701 the amount necessary to provide the monthly contribution rate a s 14
provided for under this section. Such employer contribution rate shall be 15
developed by appropriate actuarial method as a part of the determination of 16
each respective employer contribution rate determined under KRS 61.565. 17
(b) 1. Each employer described in paragraph (a) of this subsection shall deduct 18
from the creditable compensation of each member whose membership 19
date begins on or after September 1, 2008, an amount equal to one 20
percent (1%) of the member's creditable compensation. The deducted 21
amounts sh all, at the discretion of the board, be credited to accounts 22
established pursuant to 26 U.S.C. sec. 401(h), within the funds 23
established in KRS 16.510 and 61.515, or the insurance trust fund 24
established under KRS 61.701. Notwithstanding the provisions of t his 25
paragraph, a transfer of assets between the accounts established pursuant 26
to 26 U.S.C. sec. 401(h), within the funds established in KRS 16.510 27
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and 61.515, and the insurance trust fund established under KRS 61.701 1
shall not be allowed. 2
2. The employer shall file the contributions as provided by subparagraph 1. 3
of this paragraph at the retirement office in accordance with KRS 4
61.675. Any interest or penalties paid on any delinquent contributions 5
shall be credited to accounts established pursuant to 26 U.S .C. sec. 6
401(h), within the funds established in KRS 16.510 and 61.515, or the 7
insurance trust fund established under KRS 61.701. Notwithstanding 8
any minimum compensation requirements provided by law, the 9
deductions provided by this paragraph shall be made , and the 10
compensation of the member shall be reduced accordingly. 11
3. Each employer shall submit payroll reports, contributions lists, and other 12
data as may be required by administrative regulation promulgated by the 13
board of trustees pursuant to KRS Chapter 13A. 14
4. Every member shall be deemed to consent and agree to the deductions 15
made pursuant to this paragraph, and the payment of salary or 16
compensation less the deductions shall be a full and complete discharge 17
of all claims for services rendered by the person during the period 18
covered by the payment, except as to any benefits provided by KRS 19
16.505 to 16.652 or 61.510 to 61.705. No member may elect whether to 20
participate in, or choose the contribution amount to accounts established 21
pursuant to 26 U.S.C. sec. 401(h) within the funds established in KRS 22
16.510 and 61.515, or the insurance trust fund established under KRS 23
61.701. The member shall have no option to receive the contribution 24
required by this paragraph directly instead of having the contribution 25
paid to accounts established pursuant to 26 U.S.C. sec. 401(h) within the 26
funds established in KRS 16.510 and 61.515, or the insurance trust fund 27
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established under KRS 61.701. No member may receive a rebate or 1
refund of contributions. If a member establish es a membership date 2
prior to September 1, 2008, pursuant to KRS 61.552(2) or (3), then this 3
paragraph shall not apply to the member and all contributions previously 4
deducted in accordance with this paragraph shall be refunded to the 5
member without interes t. The contribution made pursuant to this 6
paragraph shall not act as a reduction or offset to any other contribution 7
required of a member or recipient under KRS 16.505 to 16.652 or 8
61.510 to 61.705. 9
5. The board of trustees, at its discretion, may direct t hat the contributions 10
required by this paragraph be accounted for within accounts established 11
pursuant to 26 U.S.C. sec. 401(h) within the funds established in KRS 12
16.510 and 61.515, or the insurance trust fund established under KRS 13
61.701, through the use of separate accounts. 14
(4) (a) The premium required to provide hospital and medical insurance plan 15
coverage under this section shall be paid wholly or partly from funds 16
contributed by: 17
1. The recipient of a retirement allowance, by payroll deduction from his 18
or her retirement allowance, or by other method; 19
2. The insurance trust fund established under KRS 61.701 or accounts 20
established pursuant to 26 U.S.C. sec. 401(h) within the funds 21
established in KRS 16.510 and 61.515; 22
3. Another state -administered ret irement system, including the County 23
Employees Retirement System, under a reciprocal arrangement, except 24
that any portion of the premium paid from the funds specified by 25
subparagraph 2. of this paragraph under a reciprocal agreement shall not 26
exceed the am ount that would be payable under this section if all the 27
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member's service were in the systems administered by the Kentucky 1
Retirement Systems. If the board provides for cross -referencing of 2
insurance premiums, the employer's contribution for the working 3
member or spouse shall be applied toward the premium, and the 4
insurance trust fund established under KRS 61.701 or accounts 5
established pursuant to 26 U.S.C. sec. 401(h) within the funds 6
established in KRS 16.510 and 61.515 shall pay the balance; or 7
4. A combination of the fund sources described by subparagraphs 1. to 3. 8
of this paragraph. 9
Group rates under the hospital and medical insurance plan shall be made 10
available to the spouse, each dependent child, and each disabled child, 11
regardless of the disabled child's age, of a recipient who is a former member 12
or the beneficiary, if the premium for the hospital and medical insurance for 13
the spouse, each dependent child, and each disabled child, or beneficiary is 14
paid by payroll deduction from the retirement allo wance, electronic funds 15
transfer, or by another method. For purposes of this subsection only, a child 16
shall be considered disabled if he or she has been determined to be eligible for 17
federal Social Security disability benefits or meets the dependent disabi lity 18
standard established by the Department of Employee Insurance in the 19
Personnel Cabinet. 20
(b) For a member who began participating in the system prior to July 1, 2003, the 21
monthly contribution rate shall be paid by the system from the funds specified 22
under paragraph (a)2. of this subsection and shall be equal to a percentage of 23
the single premium to cover the retired member as follows: 24
1. One hundred percent (100%) of the monthly premium for single 25
coverage shall be paid for a retired member who had two h undred forty 26
(240) months of service or more upon retirement or for a retired member 27
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who when he or she was an employee became disabled as a direct result 1
of an act in line of duty as defined in KRS 16.505 or as a result of a 2
duty-related injury as defined in KRS 61.621; 3
2. Seventy-five percent (75%) of the monthly premium for single coverage 4
shall be paid for a retired member who had less than two hundred forty 5
(240) months of service but at least one hundred eighty (180) months of 6
service upon retirement, provided such retired member agrees to pay the 7
remaining twenty-five percent (25%) by payroll deduction from his or 8
her retirement allowance, electronic funds transfer, or by another 9
method; 10
3. Fifty percent (50%) of the monthly premium for single coverage shall be 11
paid for a retired member who had less than one hundred eighty (180) 12
months of service but had at least one hundred twenty (120) months of 13
service upon retirement, provided such retired member agrees to pay the 14
remaining fifty percent (50%) by p ayroll deduction from his or her 15
retirement allowance, electronic funds transfer, or by another method; or 16
4. Twenty-five percent (25%) of the monthly premium for single coverage 17
shall be paid for a retired member who had less than one hundred twenty 18
(120) months of service but had at least forty -eight (48) months of 19
service upon retirement, provided such retired member agrees to pay the 20
remaining seventy-five percent (75%) by payroll deduction from his or 21
her retirement allowance, electronic funds transfer , or by another 22
method. 23
(c) Notwithstanding paragraph (b) of this subsection, for a member participating 24
in the system prior to July 1, 2003, who: 25
1. Dies as a direct result of an act in line of duty as defined in KRS 16.505 26
or dies as a result of a duty -related injury as defined in KRS 61.621, the 27
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monthly premium shall be paid for his or her spouse so long as the 1
spouse remains eligible for a monthly retirement benefit; 2
2. Becomes totally and permanently disabled as defined in KRS 16.582 as 3
a direct result of an act in line of duty as defined in KRS 16.505 or 4
becomes disabled as a result of a duty -related injury as defined in KRS 5
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a), the 6
monthly premium shall be paid for his or her spouse so long as the 7
member and the spouse individually remain eligible for a monthly 8
retirement benefit; and 9
3. Dies as a direct result of an act in line of duty as defined in KRS 16.505, 10
dies as a result of a duty -related injury as defined in KRS 61.621, 11
becomes totally and permanently disabled as defined in KRS 16.582 as a 12
direct result of an act in line of duty as defined in KRS 16.505, or 13
becomes disabled a s a result of a duty -related injury as defined in KRS 14
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a), the 15
monthly premium shall be paid for each dependent child as defined in 16
KRS 16.505, so long as the member remains eligible for a mo nthly 17
retirement benefit, unless deceased, and each dependent child 18
individually remains eligible under KRS 16.505. 19
(d) 1. For a member who began participating in the system prior to July 1, 20
2003, who was determined to be in a hazardous position in the Kentucky 21
Employees Retirement System or in a position in the State Police 22
Retirement System, or who is receiving a retirement allowance based on 23
General Assembly service, the funds specified under paragraph (a)2. of 24
this subsection shall also pay a percentage of the monthly contribution 25
rate sufficient to fund the premium costs for hospital and medical 26
insurance coverage for the spouse and for each dependent child of a 27
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recipient. 1
2. The percentage of the monthly contribution rate paid for the spouse and 2
each dependent child of a recipient who was in a hazardous position or 3
who is receiving a retirement allowance based on General Assembly 4
service in accordance with subparagraph 1. of this paragraph shall be 5
based solely on the member's service in a hazardous pos ition using the 6
formula in paragraph (b) of this subsection. 7
(e) For members who begin participating in the system on or after July 1, 2003: 8
1. Participation in the insurance benefits provided under this section shall 9
not be allowed until the member has ea rned at least one hundred twenty 10
(120) months of service in the state -administered retirement systems, 11
except that for members who begin participating in the system on or 12
after September 1, 2008, participation in the insurance benefits provided 13
under this section shall not be allowed until the member has earned at 14
least one hundred eighty (180) months of service credited under KRS 15
16.543(1) or 61.543(1), or another state-administered retirement system. 16
2. A member who meets the minimum service requirements as provided by 17
subparagraph 1. of this paragraph shall upon retirement be eligible for 18
the following monthly contribution rate to be paid on his or her behalf, 19
or on behalf of the spouse or dependent of a member with service in a 20
hazardous position, from t he funds specified under paragraph (a)2. of 21
this subsection: 22
a. For members with service in a nonhazardous position, a monthly 23
insurance contribution of ten dollars ($10) for each year of service 24
as a participating employee in a nonhazardous position; 25
b. For members with service in a hazardous position or who 26
participate in the State Police Retirement System, a monthly 27
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insurance contribution of fifteen dollars ($15) for each year of 1
service as a participating employee in a hazardous position or the 2
State Police Retirement System; and 3
c. Upon the death of the retired member, the beneficiary, if the 4
beneficiary is the member's spouse, shall be entitled to a monthly 5
insurance contribution of ten dollars ($10) for each year of service 6
the member attained as a pa rticipating employee in a hazardous 7
position. 8
3. The minimum service requirement to participate in benefits as provided 9
by subparagraph 1. of this paragraph shall be waived for a member who 10
receives a satisfactory determination of a hazardous disability th at is a 11
direct result of an act in line of duty as defined in KRS 16.505, and the 12
member shall be entitled to the benefits payable under this subsection as 13
though the member had twenty (20) years of service in a hazardous 14
position. 15
4. The minimum service r equired to participate in benefits as provided by 16
subparagraph 1. of this paragraph shall be waived for a member who is 17
disabled as a result of a duty -related injury as defined in KRS 61.621 18
and is eligible for the benefits provided by KRS 61.621(5)(b), an d the 19
member shall be entitled to the benefits payable under this subsection as 20
though the member had twenty (20) years of service in a nonhazardous 21
position. 22
5. Notwithstanding the provisions of this paragraph, the minimum service 23
requirement to participate in benefits as provided by subparagraph 1. of 24
this paragraph shall be waived for a for a member who dies as a direct 25
result of an act in line of duty as defined in KRS 16.505, who becomes 26
totally and permanently disabled as defined in KRS 16.582 as a di rect 27
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result of an act in line of duty as defined in KRS 16.505, who dies as a 1
result of a duty -related injury as defined in KRS 61.621, or who 2
becomes disabled as a result of a duty -related injury as defined in KRS 3
61.621 and is eligible for the benefits p rovided by KRS 61.621(5)(a), 4
and the premium for the member, the member's spouse, and for each 5
dependent child as defined in KRS 16.505 shall be paid in full by the 6
systems so long as the member, member's spouse, or dependent child 7
individually remains eligible for a monthly retirement benefit. 8
6. Except as provided by subparagraph 5. of this paragraph, the monthly 9
insurance contribution amount shall be increased: 10
a. On July 1 of each year by one and one -half percent (1.5%). The 11
increase shall be cumulative and shall continue to accrue after the 12
member's retirement for as long as a monthly insurance 13
contribution is payable to the retired member or beneficiary but 14
shall not apply to any increase in the contribution attributable to 15
the increase specified by subdivision b. of this subparagraph; and 16
b. On January 1 of each year by five dollars ($5) for members who 17
have accrued an additional full year of service as a participating 18
employee beyond the career threshold, subject to the following 19
restrictions: 20
i. The additional insurance contribution provided by this 21
subdivision shall only be applied to the monthly contribution 22
amounts provided under subparagraph 2.a. and b. of this 23
paragraph; 24
ii. The additional insurance contribution provided by this 25
subdivision shall only be payable towards the health plans 26
offered by the system to retirees who are not eligible for 27
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Medicare or for reimbursements provided to retirees not 1
eligible for Medicare pursuant to subsection (6)(a)2. of this 2
section; and 3
iii. In order for the an nual increase to occur as provided by this 4
subdivision, the funding level of retiree health benefits for 5
the system in which the employee is receiving the additional 6
insurance contribution shall be at least ninety percent (90%) 7
as of the most recent actuar ial valuation and be projected by 8
the actuary to remain ninety percent (90%) for the year in 9
which the increase is provided. 10
7. The benefits of this paragraph provided to a member whose participation 11
begins on or after July 1, 2003, shall not be considered as benefits 12
protected by the inviolable contract provisions of KRS 16.652 or 13
61.692. The General Assembly reserves the right to suspend or reduce 14
the benefits conferred in this paragraph if in its judgment the welfare of 15
the Commonwealth so demands. 16
8. An employee whose membership date is on or after September 1, 2008, 17
who retires and is reemployed in a regular full -time position required to 18
participate in the system or the County Employees Retirement System 19
shall not be eligible for health insurance cover age or benefits provided 20
by this section and shall take coverage with his or her employing agency 21
during the period of reemployment in a regular full-time position. 22
9. For purposes of this paragraph: 23
a. "Career threshold" for a member with service in a no nhazardous 24
position means twenty -seven (27) years of service credited under 25
KRS 16.543(1), 61.543(1), 78.615(1), or another state -26
administered retirement system and for a member with service in a 27
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hazardous position means the service requirements specified by 1
KRS 16.577(2) or (3) or 16.583(6)(b), as applicable; and 2
b. "Funding level" means the actuarial value of assets divided by the 3
actuarially accrued liability expressed as a percentage that is 4
determined and reported by the system's actuary in the annual 5
actuarial valuation. 6
(f) For members with service in another state -administered retirement system 7
who select hospital and medical insurance plan coverage through the system: 8
1. The system shall compute the member's combined service, including 9
service credit in another state -administered retirement system, and 10
calculate the portion of the member's premium monthly contribution rate 11
to be paid by the funds specified under paragraph (a)2. of this subsection 12
according to the criteria established in paragraphs (a) to (e) of this 13
subsection. Each state -administered retirement system shall pay 14
annually to the insurance trust fund established under KRS 61.701 the 15
portion of the system's co st of the retiree's monthly contribution for 16
single coverage for hospital and medical insurance plan which shall be 17
equal to the percentage of the member's number of months of service in 18
the other state -administered retirement plan divided by his or her to tal 19
combined service and in conjunction with the reciprocal agreement 20
established between the system and the other state -administered 21
retirement systems. The amounts paid by the other state -administered 22
retirement plans and by the Kentucky Retirement Syste ms from funds 23
specified under paragraph (a)2. of this subsection shall not be more than 24
one hundred percent (100%) of the monthly contribution adopted by the 25
respective boards of trustees; 26
2. A member may not elect coverage for hospital and medical benefit s 27
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through more than one (1) of the state -administered retirement systems; 1
and 2
3. A state -administered retirement system shall not pay any portion of a 3
member's monthly contribution for medical insurance unless the 4
member is a recipient or annuitant of the plan. 5
(5) Premiums paid for hospital and medical insurance coverage procured under 6
authority of this section shall be exempt from any premium tax which might 7
otherwise be required under KRS Chapter 136. The payment of premiums by the 8
funds described by sub section (4)(a)2. of this section shall not constitute taxable 9
income to an insured recipient. No commission shall be paid for hospital and 10
medical insurance procured under authority of this section. 11
(6) (a) The board shall promulgate an administrative regulation to establish a medical 12
insurance reimbursement plan to provide reimbursement for hospital and 13
medical insurance plan premiums of recipients of a retirement allowance who: 14
1. Are not eligible for the same level of hospital and medical benefits as 15
recipients living in Kentucky and having the same Medicare hospital 16
and medical insurance eligibility status; or 17
2. Are eligible for retiree health subsidies as provided by subsection (4)(e) 18
of this section, except for those recipients eligible for full premi um 19
subsidies under subsection (4)(e)5. of this section. The reimbursement 20
program as provided by this subparagraph shall be available to the 21
recipient regardless of the hospital and medical insurance plans offered 22
by the systems. 23
(b) An eligible recipient shall file proof of payment for hospital and medical 24
insurance plan coverage with the retirement office. Reimbursement to eligible 25
recipients shall be made on a quarterly basis. The recipient shall be eligible 26
for reimbursement of substantiated medical ins urance premiums for an 27
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amount not to exceed the total monthly contribution rate determined under 1
subsection (4) of this section. 2
(c) For purposes of recipients described by paragraph (a)1. of this subsection, the 3
plan shall not be made available if all rec ipients are eligible for the same 4
coverage as recipients living in Kentucky. 5
Section 6. KRS 78.5536 is amended to read as follows: 6
(1) For purposes of this section: 7
(a) "Hospital and medical insurance plan" may include, at the board's discretion, 8
any one (1) or more of the following: 9
1. Any hospital and medical expense policy or certificate, provider -10
sponsored integrated health delivery network, self -insured medical plan, 11
health maintenance organization contract, or other health benefit plan; 12
2. Any health savings account as permitted by 26 U.S.C. sec. 223 or health 13
reimbursement arrangement or a similar account as may be permitted by 14
26 U.S.C. sec. 105 or 106. Such arrangement or account, at the board's 15
discretion, may re imburse any medical expense permissible under 26 16
U.S.C. sec. 213; or 17
3. A medical insurance reimbursement program established by the board 18
through the promulgation of administrative regulation under which 19
members purchase individual health insurance coverage through a health 20
insurance exchange established under 42 U.S.C. sec. 18031 or 18041; 21
(b) "Monthly contribution rate" shall be the amount determined by the board 22
based upon the requirements of subsection (4)(a) to (d) of this section, except 23
that for mem bers who began participating in the system on or after July 1, 24
2003, the term shall mean the amount determined in subsection (4)(e) of this 25
section; and 26
(c) "Months of service" shall mean the total months of combined service used to 27
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determine benefits unde r the system, except service added to determine 1
disability benefits or service otherwise prohibited from being used to 2
determine retiree health benefits under KRS 78.510 to 78.852 shall not be 3
counted as "months of service." 4
(2) (a) 1. The board of trustees of the system shall arrange by appropriate contract 5
or on a self -insured basis to provide a group hospital and medical 6
insurance plan coverage for: 7
a. Present and future recipients of a retirement allowance from the 8
County Employees Retirement System; and 9
b. The spouse and each qualified dependent of a recipient who is a 10
former member or the beneficiary, provided the spouse and 11
dependent meet the requirements to participate in the hospital and 12
medical insurance plans established, contracted, or authorized by 13
the system. 14
2. Any recipient who chooses coverage under a hospital and medical 15
insurance plan shall pay, by payroll deduction from the retirement 16
allowance, electronic funds transfer, or by another method, the 17
difference between the premium cost of the hospital and medical 18
insurance plan coverage selected and the monthly contribution rate to 19
which he or she would be entitled under this section. 20
(b) 1. For present and future recipients of a retirement allowance from the 21
system who are not eligible for Me dicare and for those recipients 22
described in subparagraph 3.b. of this paragraph, the board may 23
authorize these participants to be included in the Kentucky Employees 24
Health Plan as provided by KRS 18A.225 to 18A.2287 and shall provide 25
benefits for recipien ts in the plan equal to those provided to state 26
employees having the same Medicare hospital and medical insurance 27
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eligibility status. Notwithstanding the provisions of any other statute 1
except subparagraph 3.b. of this paragraph, system recipients shall be 2
included in the same class as current state employees for purposes of 3
determining medical insurance policies and premiums in the Kentucky 4
Employees Health Plan as provided by KRS 18A.225 to 18A.2287. 5
2. Regardless of age, if a recipient or the spouse or dependent child of a 6
recipient who elects coverage becomes eligible for Medicare, he or she 7
shall participate in the plans offered by the systems for Medicare 8
eligible recipients. Individuals participating in the Medicare eligible 9
plans may be required to obtain and pay for Medicare Part A and Part B 10
coverage in order to participate in the Medicare eligible plans offered by 11
the system. 12
3. The system shall continue to provide the same hospital and medical 13
insurance plan coverage for recipients and qualifying dependents after 14
the age of sixty-five (65) as before the age of sixty-five (65), if: 15
a. The recipient is not eligible for Medicare coverage; or 16
b. The recipient would otherwise be eligible for Medicare c overage 17
but is subject to the Medicare Secondary Payer Act under 42 18
U.S.C. sec. 1395y(b) and has been reemployed by a participating 19
agency which offers the recipient a hospital and medical insurance 20
benefit or by a participating agency which is prevented f rom 21
offering or which does not offer a hospital and medical benefit to 22
the recipient as a condition of reemployment under KRS 70.293, 23
95.022, or 164.952. Individuals who are eligible, pursuant to this 24
subdivision, to be included in the Kentucky Employees H ealth 25
Plan as provided by KRS 18A.225 to 18A.2287 may be rated as a 26
separate class from other eligible employees and retirees for the 27
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purpose of determining medical insurance premiums. 1
(c) For recipients of a retirement allowance who are not eligible for t he same 2
level of hospital and medical benefits as recipients living in Kentucky having 3
the same Medicare hospital and medical insurance eligibility status, the board 4
shall provide a medical insurance reimbursement plan as described in 5
subsection (6) of this section. 6
(d) Notwithstanding anything in KRS Chapter 78 to the contrary, the board of 7
trustees, in its discretion, may take necessary steps to ensure compliance with 8
42 U.S.C. sec. 300bb-1 et seq. 9
(3) (a) Each employer participating in the County Employe es Retirement System as 10
provided in KRS 78.510 to 78.852 shall contribute to the insurance trust fund 11
established by KRS 61.701 the amount necessary to provide the monthly 12
contribution rate as provided for under this section. Such employer 13
contribution rate shall be developed by appropriate actuarial method as a part 14
of the determination of each respective employer contribution rate determined 15
under KRS 78.635. 16
(b) 1. Each employer described in paragraph (a) of this subsection shall deduct 17
from the creditab le compensation of each member whose membership 18
date begins on or after July 1, 2003, and who is subject to the benefits 19
provided under subsection (4)(e) of this section, an amount equal to one 20
percent (1%) of the member's creditable compensation if the me mber is 21
participating in a nonhazardous position and two percent (2%) of the 22
member's creditable compensation if the member is participating in a 23
hazardous position. The deducted amounts shall, at the discretion of the 24
board, be credited to accounts establ ished pursuant to 26 U.S.C. sec. 25
401(h), within the funds established in KRS 78.520, or the insurance 26
trust fund established under KRS 61.701. Notwithstanding the 27
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provisions of this paragraph, a transfer of assets between the accounts 1
established pursuant to 26 U.S.C. sec. 401(h), within the funds 2
established in KRS 78.520, and the insurance trust fund established 3
under KRS 61.701 shall not be allowed. 4
2. The employer shall file the contributions as provided by subparagraph 1. 5
of this paragraph at the retir ement office in accordance with KRS 6
78.625. Any interest or penalties paid on any delinquent contributions 7
shall be credited to accounts established pursuant to 26 U.S.C. sec. 8
401(h), within the funds established in KRS 78.520, or the insurance 9
trust fund established under KRS 61.701. Notwithstanding any 10
minimum compensation requirements provided by law, the deductions 11
provided by this paragraph shall be made, and the compensation of the 12
member shall be reduced accordingly. 13
3. Each employer shall submit payroll reports, contributions lists, and other 14
data as may be required by administrative regulation promulgated by the 15
board of trustees pursuant to KRS Chapter 13A. 16
4. Every member shall be deemed to consent and agree to the deductions 17
made pursuant to this paragraph, and the payment of salary or 18
compensation less the deductions shall be a full and complete discharge 19
of all claims for services rendered by the person during the period 20
covered by the payment, except as to any benefits provided by KRS 21
78.510 to 78.852. No member may elect whether to participate in, or 22
choose the contribution amount to accounts established pursuant to 26 23
U.S.C. sec. 401(h) within the funds established in KRS 78.520, or the 24
insurance trust fund established under KRS 61.701. The me mber shall 25
have no option to receive the contribution required by this paragraph 26
directly instead of having the contribution paid to accounts established 27
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pursuant to 26 U.S.C. sec. 401(h) within the funds established in KRS 1
78.520, or the insurance trust f und established under KRS 61.701. No 2
member may receive a rebate or refund of contributions. If a member 3
establishes a membership date prior to July 1, 2003, pursuant to KRS 4
61.552(2) or (3) or who is subject to the benefits provided under 5
subsection (4)(b ) or (d) of this section, then this paragraph shall not 6
apply to the member and all contributions previously deducted in 7
accordance with this paragraph shall be refunded to the member without 8
interest. The contribution made pursuant to this paragraph shall not act 9
as a reduction or offset to any other contribution required of a member 10
or recipient under KRS 78.510 to 78.852. 11
5. The board of trustees, at its discretion, may direct that the contributions 12
required by this paragraph be accounted for within acco unts established 13
pursuant to 26 U.S.C. sec. 401(h) within the funds established in KRS 14
78.520, or the insurance trust fund established under KRS 61.701, 15
through the use of separate accounts. 16
(4) (a) The premium required to provide hospital and medical insu rance plan 17
coverage under this section shall be paid wholly or partly from funds 18
contributed by: 19
1. The recipient of a retirement allowance, by payroll deduction from his 20
or her retirement allowance, electronic funds transfer, or by other 21
method; 22
2. The in surance trust fund established by KRS 61.701 or accounts 23
established pursuant to 26 U.S.C. sec. 401(h) within the funds 24
established in KRS 78.520; 25
3. Another state -administered retirement system, including the systems 26
administered by Kentucky Retirement Sy stems, under a reciprocal 27
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arrangement, except that any portion of the premium paid from the 1
funds specified by subparagraph 2. of this paragraph under a reciprocal 2
agreement shall not exceed the amount that would be payable under this 3
section if all the me mber's service were in the County Employees 4
Retirement System. If the board provides for cross -referencing of 5
insurance premiums, the employer's contribution for the working 6
member or spouse shall be applied toward the premium, and the 7
insurance trust fund established under KRS 61.701 or accounts 8
established pursuant to 26 U.S.C. sec. 401(h) within the funds 9
established in KRS 78.520, shall pay the balance; or 10
4. A combination of the fund sources described by subparagraphs 1. to 3. 11
of this paragraph. 12
Group rates under the hospital and medical insurance plan shall be made 13
available to the spouse, each dependent child, and each disabled child, 14
regardless of the disabled child's age, of a recipient who is a former member 15
or the beneficiary, if the premium for the hospital and medical insurance for 16
the spouse, each dependent child, and each disabled child, or beneficiary is 17
paid by payroll deduction from the retirement allowance, electronic funds 18
transfer, or by another method. For purposes of this subsection on ly, a child 19
shall be considered disabled if he or she has been determined to be eligible for 20
federal Social Security disability benefits or meets the dependent disability 21
standard established by the Department of Employee Insurance in the 22
Personnel Cabinet. 23
(b) For a member who began participating in the system prior to July 1, 2003, the 24
monthly contribution rate shall be paid by the system from the funds specified 25
under paragraph (a)2. of this subsection and shall be equal to a percentage of 26
the single premium to cover the retired member as follows: 27
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1. One hundred percent (100%) of the monthly premium for single 1
coverage shall be paid for a retired member who had two hundred forty 2
(240) months of service or more upon retirement or for a retired member 3
who when he or she was an employee was disabled as a direct result of 4
an act in line of duty as defined in KRS 78.510(48) or as a result of a 5
duty-related injury as defined in KRS 61.621; 6
2. Seventy-five percent (75%) of the monthly premium for single coverage 7
shall be paid for a retired member who had less than two hundred forty 8
(240) months of service but at least one hundred eighty (180) months of 9
service upon retirement, provided such retired member agrees to pay the 10
remaining twenty-five percent (25%) by pa yroll deduction from his or 11
her retirement allowance, electronic funds transfer, or by another 12
method; 13
3. Fifty percent (50%) of the monthly premium for single coverage shall be 14
paid for a retired member who had less than one hundred eighty (180) 15
months of service but had at least one hundred twenty (120) months of 16
service upon retirement, provided such retired member agrees to pay the 17
remaining fifty percent (50%) by payroll deduction from his or her 18
retirement allowance, electronic funds transfer, or by another method; or 19
4. Twenty-five percent (25%) of the monthly premium for single coverage 20
shall be paid for a retired member who had less than one hundred twenty 21
(120) months of service but had at least forty -eight (48) months of 22
service upon retirement, provided such retired member agrees to pay the 23
remaining seventy-five percent (75%) by payroll deduction from his or 24
her retirement allowance, electronic funds transfer, or by another 25
method. 26
(c) Notwithstanding paragraph (b) of this subsection, for a membe r participating 27
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in the system prior to July 1, 2003, who: 1
1. Dies as a direct result of an act in line of duty as defined in KRS 78.510 2
or dies as a result of a duty -related injury as defined in KRS 61.621, the 3
monthly premium shall be paid for his or her spouse so long as the 4
spouse remains eligible for a monthly retirement benefit; 5
2. Becomes totally and permanently disabled as defined in KRS 78.5524 as 6
a direct result of an act in line of duty as defined in KRS 78.510 or 7
becomes disabled as a result of a duty -related injury as defined in KRS 8
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a), the 9
monthly premium shall be paid for his or her spouse so long as the 10
member and the spouse individually remain eligible for a monthly 11
retirement benefit; and 12
3. Dies as a direct result of an act in line of duty as defined in KRS 78.510, 13
dies as a resu lt of a duty -related injury as defined in KRS 61.621, 14
becomes totally and permanently disabled as defined in KRS 78.5524 as 15
a direct result of an act in line of duty as defined in KRS 78.510, or 16
becomes disabled as a result of a duty -related injury as defi ned in KRS 17
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a), the 18
monthly premium shall be paid for each dependent child as defined in 19
KRS 78.510, so long as the member remains eligible for a monthly 20
retirement benefit, unless deceased, and each dependent child 21
individually remains eligible under KRS 78.510. 22
(d) 1. For a member who began participating in the system prior to July 1, 23
2003, who was determined to be in a hazardous position in the County 24
Employees Retirement System, or who is receiving a retirement 25
allowance based on General Assembly service, the funds specified under 26
paragraph (a)2. of this subsection shall also pay a percentage of the 27
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monthly contribution rate sufficient to fund the premium costs for 1
hospital and medical insu rance coverage for the spouse and for each 2
dependent child of a recipient. 3
2. The percentage of the monthly contribution rate paid for the spouse and 4
each dependent child of a recipient who was in a hazardous position or 5
who is receiving a retirement allow ance based on General Assembly 6
service in accordance with subparagraph 1. of this paragraph shall be 7
based solely on the member's service in a hazardous position using the 8
formula in paragraph (b) of this subsection, except that for any recipient 9
of a reti rement allowance from the County Employees Retirement 10
System who was contributing to the system on January 1, 1998, for 11
service in a hazardous position, the percentage of the monthly 12
contribution shall be based on the total of hazardous service and any 13
nonhazardous service as a police or firefighter with the same agency, if 14
that agency was participating in the County Employees Retirement 15
System but did not offer hazardous duty coverage for its police and 16
firefighters at the time of initial participation. 17
(e) For members who begin participating in the system on or after July 1, 2003: 18
1. Participation in the insurance benefits provided under this section shall 19
not be allowed until the member has earned at least one hundred twenty 20
(120) months of service in the state-administered retirement systems, 21
except that for members who begin participating in the system on or 22
after September 1, 2008, participation in the insurance benefits provided 23
under this section shall not be allowed until the member has earned at 24
least one hundred eighty (180) months of service credited under KRS 25
78.615(1) or another state-administered retirement system; 26
2. A member who meets the minimum service requirements as provided by 27
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subparagraph 1. of this paragraph shall upon retirement be eli gible for 1
the following monthly contribution rate to be paid on his or her behalf, 2
or on behalf of the spouse or dependent of a member with service in a 3
hazardous position, from the funds specified under paragraph (a)2. of 4
this subsection: 5
a. For members w ith service in a nonhazardous position who do not 6
meet the career threshold, a monthly insurance contribution of ten 7
dollars ($10) for each year of service as a participating employee 8
in a nonhazardous position; 9
b. For members with service in a nonhazardou s position who meet 10
the career threshold, a monthly insurance contribution towards the 11
health plans offered to retirees who are not eligible for Medicare 12
of forty dollars ($40) for each year of service as a participating 13
employee in a nonhazardous position and a monthly insurance 14
contribution towards the health plans offered to retirees who are 15
eligible for Medicare of ten dollars ($10) for each year of service 16
as a participating employee in a nonhazardous position. The 17
monthly insurance contribution payabl e to retirees eligible for 18
Medicare under this subdivision shall be adjusted as necessary so 19
that it is equivalent to the monthly contribution amount computed 20
under subdivision a. of this subparagraph as adjusted by 21
subparagraph 6.a. of this paragraph; 22
c. For members with service in a hazardous position who do not meet 23
the career threshold, a monthly insurance contribution of fifteen 24
dollars ($15) for each year of service as a participating employee 25
in a hazardous position; 26
d. For members with service in a hazardous position who meet the 27
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career threshold, a monthly insurance contribution towards the 1
health plans offered to retirees who are not eligible for Medicare 2
of fifty dollars ($50) for each year of service as a participating 3
employee in a hazardous pos ition and a monthly insurance 4
contribution towards the health plans offered to retirees who are 5
eligible for Medicare of fifteen dollars ($15) for each year of 6
service as a participating employee in a hazardous position. The 7
monthly insurance contribution payable to retirees eligible for 8
Medicare under this subdivision shall be adjusted as necessary so 9
that it is equivalent to the monthly contribution amount computed 10
under subdivision c. of this subparagraph as adjusted by 11
subparagraph 6.a. of this paragraph; and 12
e. Upon the death of the retired member, the beneficiary, if the 13
beneficiary is the member's spouse, shall be entitled to a monthly 14
insurance contribution of ten dollars ($10) for each year of service 15
the member attained as a participating employee in a hazardous 16
position; 17
3. The minimum service requirement to participate in benefits as provided 18
by subparagraph 1. of this paragraph shall be waived for a member who 19
receives a satisfactory determination of a hazardous disability that is a 20
direct result of an act in line of duty as defined in KRS 78.510(48) and 21
the member shall be entitled to the benefits payable under this 22
subsection as though the member had twenty (20) years of service in a 23
hazardous position; 24
4. The minimum service required to partici pate in benefits as provided by 25
subparagraph 1. of this paragraph shall be waived for a member who is 26
disabled as a result of a duty -related injury as defined in KRS 61.621 27
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and is eligible for the benefits provided by KRS 61.621(5)(b), and the 1
member shall be entitled to the benefits payable under this subsection as 2
though the member had twenty (20) years of service in a nonhazardous 3
position; 4
5. Notwithstanding the provisions of this paragraph, the minimum service 5
requirement to participate in benefits as provided by subparagraph 1. of 6
this paragraph shall be waived for a member who dies as a direct result 7
of an act in line of duty as defined in KRS 78.510(48), who becomes 8
totally and permanently disabled as defined in KRS 78.5524 as a direct 9
result of an a ct in line of duty as defined in KRS 78.510, who dies as a 10
result of a duty -related injury as defined in KRS 61.621, or who 11
becomes disabled as a result of a duty -related injury as defined in KRS 12
61.621 and is eligible for the benefits provided by KRS 61.6 21(5)(a), 13
and the premium for the member, the member's spouse, and for each 14
dependent child as defined in KRS 78.510 shall be paid in full by the 15
systems so long as the member, member's spouse, or dependent child 16
individually remains eligible for a monthly retirement benefit; 17
6. Except as provided by subparagraph 5. of this paragraph, the monthly 18
insurance contribution amount shall be increased: 19
a. On July 1 of each year by one and one -half percent (1.5%). The 20
increase shall be cumulative and shall continue to accrue after the 21
member's retirement for as long as a monthly insurance 22
contribution is payable to the retired member or beneficiary but 23
shall not apply to any increase in the contribution attributable to 24
the increase specified by subdivision b. of this subparagraph; and 25
b. On January 1 of each year by five dollars ($5) for members who 26
have accrued an additional full year of service as a participating 27
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employee beyond the career threshold, subject to the following 1
restrictions: 2
i. The additional insuranc e contribution provided by this 3
subdivision shall only be applied to the monthly contribution 4
amounts provided under subparagraph 2.b. and d. of this 5
paragraph; 6
ii. The additional insurance contribution provided by this 7
subdivision shall only be payable to wards the health plans 8
offered by the system to retirees who are not eligible for 9
Medicare or for reimbursements provided to retirees not 10
eligible for Medicare pursuant to subsection (6)(a)2. of this 11
section; and 12
iii. In order for the annual increase to oc cur as provided by this 13
subdivision, the funding level of retiree health benefits for 14
the system in which the employee is receiving the additional 15
insurance contribution shall be at least ninety percent (90%) 16
as of the most recent actuarial valuation and b e projected by 17
the actuary to remain ninety percent (90%) for the year in 18
which the increase is provided; 19
7. The benefits of this paragraph provided to a member whose participation 20
begins on or after July 1, 2003, shall not be considered as benefits 21
protected by the inviolable contract provisions of KRS 78.852. The 22
General Assembly reserves the right to suspend or reduce the benefits 23
conferred in this paragraph if in its judgment the welfare of the 24
Commonwealth so demands; 25
8. An employee whose membership da te is on or after September 1, 2008, 26
who retires and is reemployed in a regular full -time position required to 27
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participate in the system or the Kentucky Retirement Systems shall not 1
be eligible for health insurance coverage or benefits provided by this 2
section and shall take coverage with his or her employing agency during 3
the period of reemployment in a regular full-time position; and 4
9. For purposes of this paragraph: 5
a. "Career threshold" for a member with service in a nonhazardous 6
position means twenty -seven (27) years of service credited under 7
KRS 16.543(1), 61.543(1), 78.615(1), or another state -8
administered retirement system and for a member with service in a 9
hazardous position means the service requirements specified by 10
KRS 78.5514(2)(a)2. or (3)(b), or 78.5516(6)(b), as applicable; 11
and 12
b. "Funding level" means the actuarial value of assets divided by the 13
actuarially accrued liability expressed as a percentage that is 14
determined and reported by the system's actuary in the annual 15
actuarial valuation. 16
(f) For members with service in another st ate-administered retirement system 17
who select hospital and medical insurance plan coverage through the system: 18
1. The system shall compute the member's combined service, including 19
service credit in another state -administered retirement system, and 20
calculate the portion of the member's premium monthly contribution rate 21
to be paid by the funds specified under paragraph (a)2. of this subsection 22
according to the criteria established in paragraphs (a) to (e) of this 23
subsection. Each state -administered retirement system shall pay 24
annually to the insurance trust fund established under KRS 61.701 the 25
portion of the system's cost of the retiree's monthly contribution for 26
single coverage for hospital and medical insurance plan which shall be 27
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equal to the percentage of the member's number of months of service in 1
the other state -administered retirement plan divided by his or her total 2
combined service and in conjunction with the reciprocal agreement 3
established between the system and the other state -administered 4
retirement systems. The amounts paid by the other state -administered 5
retirement plans and by the County Employees Retirement System from 6
funds specified under paragraph (a)2. of this subsection shall not be 7
more than one hundred percent (100%) of the monthly contr ibution 8
adopted by the respective boards of trustees; 9
2. A member may not elect coverage for hospital and medical benefits 10
through more than one (1) of the state -administered retirement systems; 11
and 12
3. A state -administered retirement system shall not pay a ny portion of a 13
member's monthly contribution for medical insurance unless the 14
member is a recipient or annuitant of the plan. 15
(5) Premiums paid for hospital and medical insurance coverage procured under 16
authority of this section shall be exempt from any p remium tax which might 17
otherwise be required under KRS Chapter 136. The payment of premiums by the 18
funds described by subsection (4)(a)2. of this section shall not constitute taxable 19
income to an insured recipient. No commission shall be paid for hospital and 20
medical insurance procured under authority of this section. 21
(6) (a) The board shall promulgate an administrative regulation to establish a medical 22
insurance reimbursement plan to provide reimbursement for hospital and 23
medical insurance plan premiums of recipients of a retirement allowance who: 24
1. Are not eligible for the same level of hospital and medical benefits as 25
recipients living in Kentucky and having the same Medicare hospital 26
and medical insurance eligibility status; or 27
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2. Are eligible for retir ee health subsidies as provided by subsection (4)(e) 1
of this section, except for those recipients eligible for full premium 2
subsidies under subsection (4)(e)5. of this section. The reimbursement 3
program as provided by this subparagraph shall be available t o the 4
recipient regardless of the hospital and medical insurance plans offered 5
by the systems. 6
(b) An eligible recipient shall file proof of payment for hospital and medical 7
insurance plan coverage with the retirement office. Reimbursement to eligible 8
recipients shall be made on a quarterly basis. The recipient shall be eligible 9
for reimbursement of substantiated medical insurance premiums paid by the 10
recipient to obtain coverage for an amount not to exceed the total monthly 11
contribution rate determined und er subsection (4) of this section. For 12
reimbursements provided under paragraph (a)2. of this subsection, the full 13
subsidy under subsection (4)(e)2. of this section shall be reimbursed by the 14
system to the recipient up to the amount individually paid by the recipient to 15
obtain coverage. In the case of recipients of a retirement allowance from a 16
nonhazardous position, the reimbursement shall be limited to the amount paid 17
by the recipient to obtain single coverage. 18
(c) For purposes of recipients described by p aragraph (a)1. of this subsection, the 19
plan shall not be made available if all recipients are eligible for the same 20
coverage as recipients living in Kentucky. 21