AN ACT relating to retiree health provisions of the Kentucky Retirement Systems.

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AN ACT relating to retiree health provisions of the Kentucky Retirement Systems. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
Section 1. KRS 61.702 is amended to read as follows: 3
(1) For purposes of this section: 4
(a) "Hospital and medical insurance plan" may include, at the board's discretion, 5
any one (1) or more of the following: 6
1. Any hospital and me dical expense policy or certificate, provider -7
sponsored integrated health delivery network, self -insured medical plan, 8
health maintenance organization contract, or other health benefit plan; 9
2. Any health savings account as permitted by 26 U.S.C. sec. 223 or health 10
reimbursement arrangement or a similar account as may be permitted by 11
26 U.S.C. sec. 105 or 106. Such arrangement or account, at the board's 12
discretion, may reimburse any medical expen se permissible under 26 13
U.S.C. sec. 213; or 14
3. A medical insurance reimbursement program established by the board 15
through the promulgation of administrative regulation under which 16
members purchase individual health insurance coverage through a health 17
insurance exchange established under 42 U.S.C. sec. 18031 or 18041; 18
(b) "Monthly contribution rate" is the amount determined by the board based 19
upon the requirements of subsection (4)(a) to (d) of this section, except that 20
for members who began participating in the system on or after July 1, 2003, 21
the term shall mean the amount determined in subsection (4)(e) of this 22
section; and 23
(c) "Months of service" means the total months of combined service used to 24
determine benefits under the system, except service added t o determine 25
disability benefits or service otherwise prohibited from being used to 26
determine retiree health benefits under KRS 16.505 to 16.652 or 61.510 to 27
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61.705 shall not be counted as "months of service." For current and former 1
employees of the Council on Postsecondary Education who were employed 2
prior to January 1, 1993, and who earn at least fifteen (15) years of service 3
credit in the Kentucky Employees Retirement System, "months of service" 4
shall also include vested service in another retirement syst em other than the 5
Kentucky Teachers' Retirement System sponsored by the Council on 6
Postsecondary Education. 7
(2) (a) 1. The board of trustees of the system shall arrange by appropriate contract 8
or on a self -insured basis to provide a group hospital and medi cal 9
insurance plan coverage for: 10
a. Present and future recipients of a retirement allowance from the 11
Kentucky Employees Retirement System and the State Police 12
Retirement System; and 13
b. The spouse and each qualified dependent of a recipient who is a 14
former member or the beneficiary, provided the spouse and 15
dependent meet the requirements to participate in the hospital and 16
medical insurance plans established, contracted, or authorized by 17
the system. 18
2. Any recipient who chooses coverage under a hospital and medical 19
insurance plan shall pay, by payroll deduction from the retirement 20
allowance, electronic funds transfer, or by another method, the 21
difference between the premium cost of the hospital and medical 22
insurance plan coverage selected and the monthly cont ribution rate to 23
which he or she would be entitled under this section. 24
(b) 1. For present and future recipients of a retirement allowance from the 25
system who are not eligible for Medicare and for those recipients 26
described in subparagraph 3.b. of this para graph, the board may 27
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authorize these participants to be included in the Kentucky Employees 1
Health Plan as provided by KRS 18A.225 to 18A.2287 and shall provide 2
benefits for recipients in the plan equal to those provided to state 3
employees having the same M edicare hospital and medical insurance 4
eligibility status. Notwithstanding the provisions of any other statute 5
except subparagraph 3.b. of this paragraph, system recipients shall be 6
included in the same class as current state employees for purposes of 7
determining medical insurance policies and premiums in the Kentucky 8
Employees Health Plan as provided by KRS 18A.225 to 18A.2287. 9
2. Regardless of age, if a recipient or the spouse or dependent child of a 10
recipient who elects coverage becomes eligible for Medi care, he or she 11
shall participate in the plans offered by the systems for Medicare 12
eligible recipients. Individuals participating in the Medicare eligible 13
plans may be required to obtain and pay for Medicare Part A and Part B 14
coverage, in order to particip ate in the Medicare eligible plans offered 15
by the system. 16
3. The system shall continue to provide the same hospital and medical 17
insurance plan coverage for recipients and qualifying dependents after 18
the age of sixty-five (65) as before the age of sixty-five (65), if: 19
a. The recipient is not eligible for Medicare coverage; or 20
b. The recipient would otherwise be eligible for Medicare coverage 21
but is subject to the Medicare Secondary Payer Act under 42 22
U.S.C. sec. 1395y(b) and has been reemployed by a particip ating 23
agency which offers the recipient a hospital and medical insurance 24
benefit or by a participating agency which is prevented from 25
offering a hospital and medical benefit to the recipient as a 26
condition of reemployment under KRS 70.293, 95.022, or 27
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164.952. Individuals who are eligible, pursuant to this subdivision, 1
to be included in the Kentucky Employees Health Plan as provided 2
by KRS 18A.225 to 18A.2287 may be rated as a separate class 3
from other eligible employees and retirees for the purpose of 4
determining medical insurance premiums. 5
(c) For recipients of a retirement allowance who are not eligible for the same 6
level of hospital and medical benefits as recipients living in Kentucky having 7
the same Medicare hospital and medical insurance eligibility st atus, the board 8
shall provide a medical insurance reimbursement plan as described in 9
subsection (6) of this section. 10
(d) Notwithstanding anything in KRS Chapter 16 or 61 to the contrary, the board 11
of trustees, in its discretion, may take necessary steps to ensure compliance 12
with 42 U.S.C. secs. 300bb-1 et seq. 13
(3) (a) Each employer participating in the Kentucky Employees Retirement System 14
or the State Police Retirement System as provided in KRS 16.505 to 16.652 or 15
61.510 to 61.705 shall contribute to the in surance trust fund established under 16
KRS 61.701 the amount necessary to provide the monthly contribution rate as 17
provided for under this section. Such employer contribution rate shall be 18
developed by appropriate actuarial method as a part of the determinat ion of 19
each respective employer contribution rate determined under KRS 61.565. 20
(b) 1. Each employer described in paragraph (a) of this subsection shall deduct 21
from the creditable compensation of each member participating in a: 22
a. Nonhazardous position whose membership date begins on or after 23
September 1, 2008, and who is subject to the benefits provided 24
under subsection (4)(e) of this section, an amount equal to one 25
percent (1%) of the member's creditable compensation; and 26
b. Hazardous position as provided in KRS 61.592 or in a position 27
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participating in the State Police Retirement System, whose 1
membership date begins on or after July 1, 2003, and who is 2
subject to the benefits provided under subsection (4)(e) of this 3
section, an amount equal to two percent (2%) of the member's 4
creditable compensation. 5
The deducted amounts shall, at the discretion of the board, be credited to 6
accounts established pursuant to 26 U.S.C. sec. 401(h), within the funds 7
established in KRS 16.510 and 61.515, or the insurance trust fund 8
established under KRS 61.701. Notwithstanding the provisions of this 9
paragraph, a transfer of assets between the accounts established pursuant 10
to 26 U.S.C. sec. 401(h), within the funds established in KRS 16.510 11
and 61.515, and the insurance trust fu nd established under KRS 61.701 12
shall not be allowed. 13
2. The employer shall file the contributions as provided by subparagraph 1. 14
of this paragraph at the retirement office in accordance with KRS 15
61.675. Any interest or penalties paid on any delinquent con tributions 16
shall be credited to accounts established pursuant to 26 U.S.C. sec. 17
401(h), within the funds established in KRS 16.510 and 61.515, or the 18
insurance trust fund established under KRS 61.701. Notwithstanding 19
any minimum compensation requirements p rovided by law, the 20
deductions provided by this paragraph shall be made, and the 21
compensation of the member shall be reduced accordingly. 22
3. Each employer shall submit payroll reports, contributions lists, and other 23
data as may be required by administrative regulation promulgated by the 24
board of trustees pursuant to KRS Chapter 13A. 25
4. Every member shall be deemed to consent and agree to the deductions 26
made pursuant to this paragraph, and the payment of salary or 27
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compensation less the deductions shall be a full and complete discharge 1
of all claims for services rendered by the person during the period 2
covered by the payment, except as to any benefits provided by KRS 3
16.505 to 16.652 or 61.510 to 61.705. No member may elect whether to 4
participate in, or choose the contribution amount to accounts established 5
pursuant to 26 U.S.C. sec. 401(h) within the funds established in KRS 6
16.510 and 61.515, or the insurance trust fund established under KRS 7
61.701. The member shall have no option to receive the contribution 8
required by this paragraph directly instead of having the contribution 9
paid to accounts established pursuant to 26 U.S.C. sec. 401(h) within the 10
funds established in KRS 16.510 and 61.515, or the insurance trust fund 11
established under KRS 61.701. No member may receive a rebate or 12
refund of contributions. 13
5. If a member establishes a membership date prior to: 14
a. September 1, 2008, pursuant to KRS 61.552(2) or (3), then this 15
paragraph shall not apply to the member for purposes of the 16
contribution payable for participation in a nonhazardous 17
position as provided in subparagraph 1.a. of this paragraph; or 18
b. July 1, 2003, pursuant to KRS 61.552(2) or (3), or who is subject 19
to the benefits provided under subsection (4)(b) or (d) of this 20
section, then this paragraph shall not apply to the member; 21
and all contributions previously deducted in accordance with this 22
paragraph shall be refunded to the member without interest. 23
6. The contribution made pursuant to this paragraph shall not act as a 24
reduction or offset to any other contribution required of a member or 25
recipient under KRS 16.505 to 16.652 or 61.510 to 61.705. 26
7.[5.] The board of trustees, at its discretion, may direct that the contributions 27
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required by this paragraph be accounted for within accounts established 1
pursuant to 26 U.S.C. sec. 401(h) within the funds established in KRS 2
16.510 and 61.515, or the insurance trust fund established under KRS 3
61.701, through the use of separate accounts. 4
(4) (a) The premium required to provide hospital and medical insurance plan 5
coverage under this section shall be paid wholly or partly from funds 6
contributed by: 7
1. The recipient of a retirement allowance, by payroll deduction from his 8
or her retirement allowance, or by other method; 9
2. The insurance trust fund established under KRS 61.701 or accounts 10
established pursuant to 26 U.S.C. sec. 401(h) within the funds 11
established in KRS 16.510 and 61.515; 12
3. Another state -administered retirement system, including the County 13
Employees Retirement System, under a reciprocal arrangement, except 14
that any portion of the premium paid from the funds specified by 15
subparagraph 2. of this paragraph under a reciprocal agreement shall not 16
exceed the amount that would be payable under this section if all the 17
member's service were in the systems administered by the Kentucky 18
Retirement Systems. If the board provides for cross -referencing of 19
insurance premiums, the employer's contribution for the working 20
member or spouse shall be applied toward the premium, and the 21
insurance trust fund established under KRS 61.701 or accounts 22
established pursuant to 26 U.S.C. sec. 401(h) within the funds 23
established in KRS 16.510 and 61.515 shall pay the balance; or 24
4. A combination of the fund sources described by subparagraphs 1. to 3. 25
of this paragraph. 26
Group rates under the hospital and medical insurance plan shall be made 27
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available to the spouse, each dependent ch ild, and each disabled child, 1
regardless of the disabled child's age, of a recipient who is a former member 2
or the beneficiary, if the premium for the hospital and medical insurance for 3
the spouse, each dependent child, and each disabled child, or benefici ary is 4
paid by payroll deduction from the retirement allowance, electronic funds 5
transfer, or by another method. For purposes of this subsection only, a child 6
shall be considered disabled if he or she has been determined to be eligible for 7
federal Social S ecurity disability benefits or meets the dependent disability 8
standard established by the Department of Employee Insurance in the 9
Personnel Cabinet. 10
(b) For a member who began participating in the system prior to July 1, 2003, the 11
monthly contribution rate shall be paid by the system from the funds specified 12
under paragraph (a)2. of this subsection and shall be equal to a percentage of 13
the single premium to cover the retired member as follows: 14
1. One hundred percent (100%) of the monthly premium for single 15
coverage shall be paid for a retired member who had two hundred forty 16
(240) months of service or more upon retirement or for a retired member 17
who when he or she was an employee became disabled as a direct result 18
of an act in line of duty as defined in KRS 16.505 or as a result of a 19
duty-related injury as defined in KRS 61.621; 20
2. Seventy-five percent (75%) of the monthly premium for single coverage 21
shall be paid for a retired member who had less than two hundred forty 22
(240) months of service but at least on e hundred eighty (180) months of 23
service upon retirement, provided such retired member agrees to pay the 24
remaining twenty-five percent (25%) by payroll deduction from his or 25
her retirement allowance, electronic funds transfer, or by another 26
method; 27
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3. Fifty percent (50%) of the monthly premium for single coverage shall be 1
paid for a retired member who had less than one hundred eighty (180) 2
months of service but had at least one hundred twenty (120) months of 3
service upon retirement, provided such retired member agrees to pay the 4
remaining fifty percent (50%) by payroll deduction from his or her 5
retirement allowance, electronic funds transfer, or by another method; or 6
4. Twenty-five percent (25%) of the monthly premium for single coverage 7
shall be paid for a retired member who had less than one hundred twenty 8
(120) months of service but had at least forty -eight (48) months of 9
service upon retirement, provided such retired member agrees to pay the 10
remaining seventy-five percent (75%) by payroll deduction from h is or 11
her retirement allowance, electronic funds transfer, or by another 12
method. 13
(c) Notwithstanding paragraph (b) of this subsection, for a member participating 14
in the system prior to July 1, 2003, who: 15
1. Dies as a direct result of an act in line of duty as defined in KRS 16.505 16
or dies as a result of a duty -related injury as defined in KRS 61.621, the 17
monthly premium shall be paid for his or her spouse so long as the 18
spouse remains eligible for a monthly retirement benefit; 19
2. Becomes totally and permane ntly disabled as defined in KRS 16.582 as 20
a direct result of an act in line of duty as defined in KRS 16.505 or 21
becomes disabled as a result of a duty -related injury as defined in KRS 22
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a), the 23
monthly premium shall be paid for his or her spouse so long as the 24
member and the spouse individually remain eligible for a monthly 25
retirement benefit; and 26
3. Dies as a direct result of an act in line of duty as defined in KRS 16.505, 27
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dies as a result of a duty -related injury as defined in KRS 61.621, 1
becomes totally and permanently disabled as defined in KRS 16.582 as a 2
direct result of an act in line of duty as defined in KRS 16.505, or 3
becomes disabled as a result of a duty -related injury as defined in KRS 4
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a), the 5
monthly premium shall be paid for each dependent child as defined in 6
KRS 16.505, so long as the member remains eligible for a monthly 7
retirement benefit, unless deceased, and ea ch dependent child 8
individually remains eligible under KRS 16.505. 9
(d) 1. For a member who began participating in the system prior to July 1, 10
2003, who was determined to be in a hazardous position in the Kentucky 11
Employees Retirement System or in a positio n in the State Police 12
Retirement System, or who is receiving a retirement allowance based on 13
General Assembly service, the funds specified under paragraph (a)2. of 14
this subsection shall also pay a percentage of the monthly contribution 15
rate sufficient to f und the premium costs for hospital and medical 16
insurance coverage for the spouse and for each dependent child of a 17
recipient. 18
2. The percentage of the monthly contribution rate paid for the spouse and 19
each dependent child of a recipient who was in a hazard ous position or 20
who is receiving a retirement allowance based on General Assembly 21
service in accordance with subparagraph 1. of this paragraph shall be 22
based solely on the member's service in a hazardous position using the 23
formula in paragraph (b) of this subsection. 24
(e) For members who begin participating in the system on or after July 1, 2003: 25
1. Participation in the insurance benefits provided under this section shall 26
not be allowed until the member has earned at least one hundred twenty 27
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(120) months of service in the state -administered retirement systems, 1
except that for members who begin participating in the system on or 2
after September 1, 2008, participation in the insurance benefits provided 3
under this section shall not be allowed until the member has earned at 4
least one hundred eighty (180) months of service credited under KRS 5
16.543(1) or 61.543(1), or another state-administered retirement system. 6
2. A member who meets the minimum service requirements as provided by 7
subparagraph 1. of this paragraph shall upon retirement be eligible for 8
the following monthly contribution rate to be paid on his or her behalf, 9
or on behalf of the spouse or dependent of a member with service in a 10
hazardous position, from the funds specified under paragraph (a)2. of 11
this subsection: 12
a. For members with service in a nonhazardous position, a monthly 13
insurance contribution of ten dollars ($10) for each year of service 14
as a participating employee in a nonhazardous position; 15
b. For members with service in a hazardous position who do not 16
meet the career threshold or with service[who participate] in the 17
State Police Retirement System who do not meet the career 18
threshold, a monthly insurance contribution of fifteen dollars 19
($15) for each year of service as a participating employee in a 20
hazardous position or the State Police Retirement System;[ and] 21
c. For members with service in a hazardous position who meet the 22
career threshold or with service in the State Police Retirement 23
System who meet the career threshold, a monthly insurance 24
contribution towards the health plans offered to retirees who are 25
not eligible for Medicare of fifty dollars ($50) for each year of 26
service as a participating employee in a hazardous position or 27
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the State Police Retirement System and a monthly insurance 1
contribution towards the health plans offered to retirees who are 2
eligible for Medicare of fifteen dollars ($15) for each year of 3
service as a participating employee in a hazardous position or 4
the State Police Retirement System. The monthly insurance 5
contribution payable t o retirees eligible for Medicare under this 6
subdivision shall be adjusted as necessary so that it is equivalent 7
to the monthly contribution amount computed under subdivision 8
b. of this subparagraph as adjusted by subparagraph 6.a. of this 9
paragraph; and 10
d.[c.] Upon the death of the retired member, the beneficiary, if the 11
beneficiary is the member's spouse, shall be entitled to a monthly 12
insurance contribution of ten dollars ($10) for each year of service 13
the member attained as a participating employee in a hazardous 14
position. 15
3. The minimum service requirement to participate in benefits as provided 16
by subparagraph 1. of this paragraph shall be waived for a member who 17
receives a satisfactory determination of a hazardous disability that is a 18
direct result of a n act in line of duty as defined in KRS 16.505, and 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 hazardous 21
position. 22
4. The minimum service required to participate in benefits as provided by 23
subparagraph 1. of this paragraph shall be waived for a member who is 24
disabled as a result of a duty -related injury as defined in KRS 61.621 25
and is eligible for the benefits provided by KRS 61.621(5)(b), and the 26
member shall be entitled to the benefits payable under this subsection as 27
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though the member had twenty (20) years of service in a nonhazardous 1
position. 2
5. Notwithstanding the provisions of this paragraph, the minimum service 3
requirement to participate in benefits as provided by subparagraph 1. of 4
this paragraph shall be waived for a for a member who dies as a direct 5
result of an act in line of duty as defined in KRS 16.505, who becomes 6
totally and permanently disabled as defined in KRS 16.582 as a direct 7
result of an act in l ine of duty as defined in KRS 16.505, who dies as a 8
result of a duty -related injury as defined in KRS 61.621, or who 9
becomes disabled as a result of a duty -related injury as defined in KRS 10
61.621 and is eligible for the benefits provided by KRS 61.621(5)(a ), 11
and the premium for the member, the member's spouse, and for each 12
dependent child as defined in KRS 16.505 shall be paid in full by the 13
systems so long as the member, member's spouse, or dependent child 14
individually remains eligible for a monthly retirement benefit. 15
6. Except as provided by subparagraph 5. of this paragraph, the monthly 16
insurance contribution amount shall be increased: 17
a. On July 1 of each year by one and one -half percent (1.5%). The 18
increase shall be cumulative and shall continue to acc rue after the 19
member's retirement for as long as a monthly insurance 20
contribution is payable to the retired member or beneficiary but 21
shall not apply to any increase in the contribution attributable to 22
the increase specified by subdivision b. of this subparagraph; and 23
b. On January 1 of each year by five dollars ($5) for members who 24
have accrued an additional full year of service as a participating 25
employee beyond the career threshold, subject to the following 26
restrictions: 27
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i. The additional insurance contr ibution provided by this 1
subdivision shall only be applied to the monthly contribution 2
amounts provided under subparagraph 2.a. and c.[b.] of this 3
paragraph; 4
ii. The additional insurance contribution provided by this 5
subdivision shall only be payable towar ds the health plans 6
offered by the system to retirees who are not eligible for 7
Medicare or for reimbursements provided to retirees not 8
eligible for Medicare pursuant to subsection (6)(a)2. of this 9
section; and 10
iii. In order for the annual increase to occur as provided by this 11
subdivision, the funding level of retiree health benefits for 12
the system in which the employee is receiving the additional 13
insurance contribution shall be at least ninety percent (90%) 14
as of the most recent actuarial valuation and be p rojected by 15
the actuary to remain ninety percent (90%) for the year in 16
which the increase is provided. 17
7. The benefits of this paragraph provided to a member whose participation 18
begins on or after July 1, 2003, shall not be considered as benefits 19
protected by the inviolable contract provisions of KRS 16.652 or 20
61.692. The General Assembly reserves the right to suspend or reduce 21
the benefits conferred in this paragraph if in its judgment the welfare of 22
the Commonwealth so demands. 23
8. An employee whose member ship date is on or after September 1, 2008, 24
who retires and is reemployed in a regular full -time position required to 25
participate in the system or the County Employees Retirement System 26
shall not be eligible for health insurance coverage or benefits provid ed 27
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by this section and shall take coverage with his or her employing agency 1
during the period of reemployment in a regular full-time position. 2
9. For purposes of this paragraph: 3
a. "Career threshold" for a member with service in a nonhazardous 4
position means twenty-seven (27) years of service credited under 5
KRS 16.543(1), 61.543(1), 78.615(1), or another state -6
administered retirement system and for a member with service in a 7
hazardous position means the service requirements specified by 8
KRS 16.577(2) or (3) or 16.583(6)(b), as applicable; and 9
b. "Funding level" means the actuarial value of assets divided by the 10
actuarially accrued liability expressed as a percentage that is 11
determined and reported by the system's actuary in the annual 12
actuarial valuation. 13
(f) For members with service in another state -administered retirement system 14
who select hospital and medical insurance plan coverage through the system: 15
1. The system shall compute the member's combined service, including 16
service credit in another state -administered retirement system, and 17
calculate the portion of the member's premium monthly contribution rate 18
to be paid by the funds specified under paragraph (a)2. of this subsection 19
according to the criteria established in paragraphs (a) to (e) of this 20
subsection. Each state -administered retirement system shall pay 21
annually to the insurance trust fund established under KRS 61.701 the 22
portion of the system's cost of the retiree's monthly contribution for 23
single coverage for hospital and medical insurance plan which shall be 24
equal to the percentage of the member's number of months of service in 25
the other state -administered retirement plan divided by his or her total 26
combined service and in conjunction with the reciprocal agreement 27
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established between the system and the other state -administered 1
retirement systems. The amounts paid by the other state -administered 2
retirement plans and by the Kentucky Retirement Systems from funds 3
specified under paragraph (a)2. of this subsection shall not be more than 4
one hundred percent (100%) of the monthly contribution adopted by the 5
respective boards of trustees; 6
2. A member may not elect coverage for hospital and medical benefits 7
through more than one (1) of the state -administered retirement systems; 8
and 9
3. A state -administered retirement system shall not pay any portion of a 10
member's monthly contribution for medical insurance unless the 11
member is a recipient or annuitant of the plan. 12
(5) Premiums paid for hospital and medical insurance coverage procured under 13
authority of this section shall be exempt from any premium tax which might 14
otherwise be required under KRS Chapter 136. The payment of premiums by the 15
funds described by subsection (4)(a)2. of this section shall not constitute taxable 16
income to an insured recipient. No com mission shall be paid for hospital and 17
medical insurance procured under authority of this section. 18
(6) (a) The board shall promulgate an administrative regulation to establish a medical 19
insurance reimbursement plan to provide reimbursement for hospital and 20
medical insurance plan premiums of recipients of a retirement allowance who: 21
1. Are not eligible for the same level of hospital and medical benefits as 22
recipients living in Kentucky and having the same Medicare hospital 23
and medical insurance eligibility status; or 24
2. Are eligible for retiree health subsidies as provided by subsection (4)(e) 25
of this section, except for those recipients eligible for full premium 26
subsidies under subsection (4)(e)5. of this section. The reimbursement 27
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program as provided by this subparagrap h shall be available to the 1
recipient regardless of the hospital and medical insurance plans offered 2
by the systems. 3
(b) An eligible recipient shall file proof of payment for hospital and medical 4
insurance plan coverage with the retirement office. Reimburs ement to eligible 5
recipients shall be made on a quarterly basis. The recipient shall be eligible 6
for reimbursement of substantiated medical insurance premiums paid by the 7
recipient to obtain coverage for an amount not to exceed the total monthly 8
contribution rate determined under subsection (4) of this section. For 9
reimbursements provided under paragraph (a)2. of this subsection, the full 10
subsidy under subsection (4)(e)2. of this section shall be reimbursed by the 11
system to the recipient up to the amount in dividually paid by the recipient to 12
obtain coverage. In the case of recipients of a retirement allowance from a 13
nonhazardous position, the reimbursement shall be limited to the amount 14
paid by the recipient to obtain single coverage. 15
(c) For purposes of recipients described by paragraph (a)1. of this subsection, the 16
plan shall not be made available if all recipients are eligible for the same 17
coverage as recipients living in Kentucky. 18
Section 2. The Public Pension Oversight Board shall continue to monitor the 19
actuarial data of the Kentucky Employees Retirement System and State Police 20
Retirement System retiree health funds and shall, during the 2026 Interim, evaluate 21
potential legislative options to adjust retiree health bene fits and costs for those members 22
who began participating in the system on or after July 1, 2003, in the event the retiree 23
health funds continue to see actuarial improvement. 24
Section 3. The amendments to the employee cont ribution provisions specified 25
in subsection (3)(b) of Section 1 of this Act shall apply to employee contributions 26
payable on or after July 1, 2027. 27
UNOFFICIAL COPY 26 RS BR 1838
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Section 4. The amendments to the monthly insurance contribution amounts 1
specified in subsection (4)(e)2. of Section 1 of this Act shall: 2
(1) Be payable prospectively for insurance premiums for health plans beginning 3
on or after January 1, 2027; 4
(2) Be increased annually after January 1, 2027, in accordance with subsection 5
(4)(e)6.a. of Section 1 of this Act; and 6
(3) For purposes of calculating the amounts that become payable on or after 7
January 1, 2027, apply to the service as a participating employee accrued o n or after July 8
1, 2003, for covered members and retirees, regardless of retirement date. 9