AN ACT CONCERNING EMPLOYEE HEALTH SECURITY.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2005) As used in sections 1 to 8, inclusive, of this act:

(1) "Coverage" means a health insurance plan, provided in accordance with section 4 of this act, that offers, to the extent possible, health care services and a provider network comparable to that offered by the program established for state employees under the authority of subsection (a) of section 5-259 of the general statutes, based on the anticipated amounts of employer fees and enrollee contributions to be collected under sections 5 and 6 of this act;

(2) "Dependent" means the spouse, domestic partner, minor child of a covered enrollee, or child eighteen years of age or over who is dependent on the enrollee, as specified by the commissioner, but does not mean a dependent who is provided coverage by another employer or who is an enrollee as a consequence of such dependent's employment status;

(3) "Enrollee" means a person who works three months or more, for not less than thirty-five hours per week, for any individual employer, including a sole proprietor or partner of a partnership;

(4) "Employer" means an employer that is subject to chapter 567 of the general statutes, excluding the state, any political subdivision of the state or any quasi-public agency, and includes a franchisor with franchisees that employ collectively five thousand or more employees in the state; and

(5) "Wages" means wages paid directly to an individual by his or her employer.

Sec. 2. (NEW) (Effective July 1, 2005) On and after January 1, 2006, and annually thereafter, all employers with five thousand or more employees shall pay a Health Security Surcharge to the Commissioner of Social Services. Such charge shall be equal to twenty-five per cent of the hourly minimum wage then in effect, multiplied by the total number of hours worked by each enrollee during the year for which the surcharge applies. Each employer providing health care benefits or making payments in accordance with section 5 of this act shall receive a credit, for each covered enrollee, against such surcharge equal to the amount paid by the employer for health care benefits or in accordance with section 5 of this act for the enrollee and, if applicable, the dependents of the enrollee. All amounts collected under this section shall be deposited into the General Fund. The Commissioner of Social Services, in conjunction with the Commissioner of Revenue Services, shall adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, to carry out the purposes of this section.

Sec. 3. (NEW) (Effective July 1, 2005) (a) On and after January 1, 2007, employers shall comply with the provisions of sections 1 and 3 to 8, inclusive, of this act.

(b) Any employee covered by a collective bargaining agreement on January 1, 2006, shall not be an enrollee under sections 3 to 8, inclusive, of this act until the expiration of such collective bargaining agreement.

Sec. 4. (NEW) (Effective July 1, 2005) The Commissioner of Social Services shall establish a health insurance plan to implement the provisions of sections 1 to 8, inclusive, of this act. Said plan shall be known as the HUSKY W Plan. On and after January 1, 2007, the commissioner shall provide coverage under the HUSKY W Plan for enrollees and, if applicable, such enrollees' dependents. Such coverage shall be funded by the employer fees and enrollee contributions established in sections 5 and 6 of this act, which shall be deposited into a separate fund within the Department of Social Services. The commissioner shall administer the coverage in a manner that assures that such fees and enrollee contributions are sufficient to maintain the coverage, including administrative costs. Any excess of fees and enrollee contributions over the actual cost of coverage for enrollees shall be used to increase provider reimbursement rates for the HUSKY Plan.

Sec. 5. (NEW) (Effective July 1, 2005) (a) On and after January 1, 2007, except as otherwise provided in section 7 of this act, every employer with five thousand or more employees shall pay a fee as specified in this section.

(b) The Commissioner of Social Services shall establish the fee for each employer, which shall equal: (1) The premium that would be required for health care coverage for all of the employer's enrollees and, if applicable, their dependents, except those excluded under subsection (f) of this section, under the program established pursuant to subsection (a) of section 5-259 of the general statutes, and (2) an amount equal to two per cent of the amount in subdivision (1) of this subsection to cover costs associated with the administration of and enforcement of the provisions of sections 1 to 8, inclusive, of this act. If more than one plan is established under the authority of section 5-259 of the general statutes, the premium used to establish the fee shall be for the plan chosen by the greatest number of state employees under such program. The cost of coverage shall be paid solely by the fees and enrollee contributions collected pursuant to this section and section 6 of this act. Except as otherwise provided in sections 1 to 8, inclusive, of this act, such fees and enrollee contributions shall not be used for any purpose other than providing coverage for enrollees and, if applicable, such enrollees' dependents, and reimbursing the administrative costs specified in this subsection.

(c) On or before July 1, 2006, and annually thereafter, the commissioner shall notify each employer required to pay a fee under this section of the amount of such fee, which shall be payable quarterly to the commissioner, beginning on or before the following January first.

(d) The commissioner shall waive the fee of any employer that is entitled to a credit pursuant to section 7 of this act to the extent of such credit. Employers may apply for the credit in the manner prescribed by the commissioner.

(e) Each employer shall provide information as specified by the commissioner to assist the commissioner in determining the fee pursuant to subsection (b) of this section.

(f) Any enrollee who provides documentation to the commissioner, in a form approved by the commissioner, that such enrollee and, if applicable, such enrollee's dependents is covered by health insurance provided by a private or self-insured insurer, or by any public program, and any other enrollee working fewer than twenty-five hours per week may decline coverage under sections 1 to 8, inclusive, of this act. The commissioner shall not include such enrollee in determining the fee for such enrollee's employer pursuant to subsection (b) of this section.

(g) Coverage of an enrollee or, if applicable, such enrollee's dependents shall not be contingent upon payment of the fee required pursuant to this section by the employer of that enrollee. If an employer fails to pay the required fee or the total amount of such fee, the employer shall pay the fund a penalty of two hundred per cent of the amount due and unpaid.

(h) In addition to the penalty imposed pursuant to subsection (g) of this section, an employer shall pay interest on all amounts due and unpaid in accordance with the rate provided for unpaid contributions under chapter 567 of the general statutes.

(i) Nothing in this section shall preclude an employer from purchasing additional benefits or coverage, in addition to paying the fee.

Sec. 6. (NEW) (Effective July 1, 2005) (a) The applicable enrollee contribution, not to exceed fifteen per cent of the fee assessed to the employer, shall be collected by the employer and paid concurrently with the employer fee. The employer may agree to pay more than eighty-five per cent of the fee, resulting in an enrollee and, if applicable, dependent contribution of less than fifteen per cent.

(b) If the employer fails to collect or transmit the enrollee contribution or premium in a timely manner, the employer shall become liable for a penalty of two hundred per cent of the amount that the employer has failed to collect or transmit, and the enrollee shall be relieved of all liability for that failure. The employer's failure to collect or transmit the required enrollee contribution or premium or to provide enrollment information about an enrollee shall not affect the enrollee's coverage. An employer shall only withhold and collect an amount for purposes of the program in accordance with the manner and at the times specified by the Commissioner of Social Services pursuant to this section. An enrollee for whom enrollment information is not otherwise received by the commissioner may demonstrate eligibility for coverage by demonstrating employment to the satisfaction of the commissioner.

Sec. 7. (NEW) (Effective July 1, 2005) (a) (1) An employer required to pay a fee under section 5 of this act may apply to the Commissioner of Social Services for a waiver of the fee by providing proof of alternate health care coverage for enrollees and, if applicable, such enrollees' dependents consistent with sections 1 to 8, inclusive, of this act. Proof of alternate health care coverage shall include documentation showing that (A) such employer is paying at least as much for each enrollee and dependent for the alternate health care coverage, excluding enrollees that have declined such coverage, as the state pays for each eligible employee and dependent pursuant to subsection (a) of section 5-259 of the general statutes, or (B) such alternate health care coverage is substantially equivalent to the health care coverage provided to state employees under subsection (a) of section 5-259 of the general statutes, and that the cost of the alternate health care coverage to such employer's enrollees is no greater than the cost to eligible state employees for coverage under subsection (a) of section 5-259 of the general statutes.

(2) For any period during which the commissioner is determining whether an employer is entitled to a credit against the fee pursuant to this section, the employer may continue to provide alternate health care coverage for enrollees and need not pay any fee under section 5 of this act for those enrollees and, if applicable, dependents of such enrollees for which the employer claims a credit against the fee. If the commissioner determines that the employer is not entitled to a credit against the fee, the employer shall be liable for any difference in the amount the employer paid for such alternate health care coverage and the amount of the fee that would have been payable for the period during which the commissioner was making such determination.

(b) Nothing in this section shall preclude an employer from providing additional benefits or coverage.

(c) It shall be unlawful for an employer to designate an employee as an independent contractor or temporary employee, reduce an employee's hours of work, or terminate and rehire an employee to avoid the employer's obligations pursuant to sections 1 to 8, inclusive, of this act. An employer that violates this subsection shall pay to the fund a penalty of two hundred per cent of the amount of any fee that would have otherwise been paid by the employer, including for the period that the enrollee and, if applicable, dependents should have received coverage but for the employer's conduct in violation of this section.

(d) An employer shall not request or otherwise seek to obtain information concerning income or other eligibility requirements for public health benefit programs regarding an employee, dependent or other family member of an employee, other than that information about the employee's employment status otherwise known to the employer consistent with existing state and federal law and regulation.

(e) Any new employer or existing employer that previously was not subject to this section shall begin complying with all applicable provisions of this section not later than one month after the date it becomes subject to sections 1 to 8, inclusive, of this act.

(f) Any existing employer previously subject to sections 1 to 8, inclusive, of this act but no longer subject to said sections shall notify the Commissioner of Social Services in a manner prescribed by that department not later than fifteen days after this change before discontinuing compliance with the provisions of sections 1 to 8, inclusive, of this act.

Sec. 8. (NEW) (Effective July 1, 2005) The Commissioner of Social Services shall adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, to facilitate the provisions of sections 1 to 7, inclusive, of this act.