OLR Bill Analysis

sSB 913

AN ACT CONCERNING HEALTH CARE DATA REPORTING AND THE ENROLLMENT OF NONSTATE PUBLIC EMPLOYEES IN THE STATE EMPLOYEE HEALTH PLAN.

SUMMARY:

This bill requires the comptroller to offer nonstate public employers and their employees and retirees coverage under the state employee health insurance plan. It defines “nonstate public employer” as a municipality or other state political subdivision, including a board of education, quasi-public agency, or public library. A municipality and a board of education may be considered separate employers.

It requires such nonstate employees to be pooled with the state employee plan as long as their employer's application meets the bill's requirements. Premium payments for such coverage must be set at the same rate as those for the state plan and may include state employee or retiree contributions. It permits the comptroller to charge an administrative fee.

The bill requires a nonstate public employer to pay monthly premiums to the comptroller in an amount he determines for providing coverage for the group's employees and retirees. It permits an employer to require a covered employee or retiree to pay part of the coverage cost, subject to any applicable collective bargaining agreement.

If an employer seeks to admit fewer than 100% of its employees, the comptroller must forward the application to the Health Care Cost Containment Committee (HCCC) to review it for a potential disproportionate shift of an employer's medical risks. If the committee finds a disproportionate shift, then the comptroller must deny the application. The bill outlines the application process and other details related to joining the state plan.

Further, the bill prohibits the comptroller from admitting nonstate employees into the state employee pool unless the State Employees' Bargaining Agent Coalition consents to the bill's terms and submits this consent to both chambers of the General Assembly.

The bill requires entities that issue or administer group health insurance policies for certain municipal employers, by October 1, 2015, and municipalities that sponsor these policies for their employees or retirees, by October 1, 2016, to begin annually submitting specific policy and claims-related information to the state comptroller. The information must cover policies providing (1) basic hospital or medical-surgical expense coverage, (2) major medical expense coverage, (3) hospital or medical service plan contracts, (4) hospital and medical coverage for health care center subscribers, and (5) single service ancillary health coverage.

Lastly, the bill allows the comptroller to (1) convene a temporary working group to develop health care provider payment reforms for state employee group health plans and (2) enter into a cooperative agreement with certain group health insurers, administrators, and health care providers under certain conditions. The comptroller must report on the group's recommendations by January 1, 2017.

EFFECTIVE DATE: October 1, 2015 for the health insurance pooling provisions and July 1, 2015 for the insurance data provisions.

4-8 — POOLING NONSTATE PUBLIC EMPLOYEES IN THE STATE EMPLOYEE PLAN

The bill requires the comptroller to offer to any nonstate public employer coverage under the state employee health insurance plan for its nonstate public employees and retirees. Under the bill, nonstate public employees include employees and elected officials.

It requires that such nonstate participants be pooled with the state employee plan as long as the employer application meets the bill's requirements. Current law permits the comptroller to provide insurance to these same employees and employers under another state plan, known as the partnership plan, but it does not pool them with state employees. Thus, the existing law created a separate insurance pool.

Premium payments for such coverage must be at the same rate as those for the state plan including state employee contributions, and the employer must make payments to the comptroller. It permits the comptroller to charge a monthly, per-member administrative fee. A nonstate public employer may require each nonstate public employee to contribute a portion of the cost of his or her coverage under the plan, subject to any collective bargaining obligation applicable to such nonstate public employer.

The bill specifies that it does not (1) require the comptroller to offer coverage to every nonstate public employer seeking coverage under the state employee plan and (2) prohibit the comptroller from procuring coverage for nonstate public employees from other vendors who are not providing state employee coverage.

5 — Application Process

The bill requires the comptroller to create applications for coverage under, and renewal of, the state employee plan. The applications must require a nonstate public employer to disclose whether it will offer any other health care benefits plan to employees offered the state employee plan. Specifically, the bill bans employees covered by a nonstate public employer with a health plan or insurance arrangement operated through a trust established according to collective bargaining under the federal Labor Management Relations Act.

The bill permits a nonstate public employer to submit an application for coverage under the state employee plan to the comptroller. If an employer's application is for coverage of all of its nonstate public employees, the comptroller must provide coverage by the first day of the third calendar month following such application (at least 60 days and as many as 90 days).

If a nonstate public employer applies for coverage for less than all of its nonstate public employees, or indicates that it will offer other health plans to the employees who are offered the state health plan, the comptroller must forward the application to the HCCC for review within five business days after receiving it. This requirement does not apply if the employer is not covering all employees because (1) some employees have declined coverage on their own or (2) the employer has chosen not to cover temporary, part-time, or durational employees.

5 — Disproportionate Medical Risks

The bill requires the HCCC to examine the applications it receives to determine if the application will shift a significantly disproportional (presumably disproportionate) part of a nonstate public employer's medical risks to the state employee plan. It has 30 days after receiving the application to make this determination.

If HCCC certifies to the comptroller that the application will shift a significantly disproportionate part of an employer's medical risks to the state employee plan, the comptroller cannot provide that employer coverage. If HCCC does not certify that the application will shift a significantly disproportionate risk to the state employee plan, the comptroller must provide coverage by the first day of the third calendar month following the deadline for receiving the certification.

5 — Collective Bargaining and Other Provisions

The bill requires a nonstate public employer's initial and continuing participation in the state employee plan to be a mandatory subject of collective bargaining and binding interest arbitration according to the same procedures and standards that apply to other mandatory subjects of bargaining under the state employee, municipal employee, or teacher bargaining laws.

The bill also requires that the state plan cannot be deemed (1) an unauthorized insurer, or (2) a multiple employer welfare arrangement. It specifies that the bill overrides any state law that may conflict with this provision. Any licensed insurer in this state may conduct business with the state employee plan.

6 — Retirees

The bill allows any nonstate public employer eligible to enroll its employees in the state employee plan under the bill to also apply for coverage of its retirees. Its premium must be the same as the state's, including any premiums paid by retired state employees. The bill otherwise provides the same criteria and mechanisms regarding retirees, including:

1. prohibiting approval of applications that shift a significantly disproportionate part of retiree medical risks to the state plan, and

2. the timeframes for an application's approval or rejection.

5 — Plan Renewal and Withdrawal

The bill requires the comptroller to offer coverage in the plan for periods of at least three years.

He must also develop procedures for nonstate public employers already in the plan to (1) apply for renewal, or (2) withdraw from such coverage. A nonstate public employer can apply for renewal before the expiration of each interval.

The procedures must at least address:

1. the terms and conditions allowing a nonstate public employer to withdraw prior to the expiration date of the current coverage,

2. how premium payments or premium equivalent payments made in excess of incurred claims will be refunded to an employer, and

3. how the process of any unionized employees withdrawing from the plan must be in accordance with relevant state collective bargaining law (state employee, municipal employee, or teachers).

7 — Failure to Pay Plan Premiums and Plan Account

The bill requires a nonstate public employer to pay monthly premiums to the comptroller in an amount he determines for providing coverage for the group's employees and retirees. It permits an employer to require a covered employee or retiree to pay part of the coverage cost, subject to any applicable collective bargaining agreement.

If an employer fails to make premium payments, the bill authorizes the comptroller to direct the state treasurer, or any state officer who holds state money (i.e., grant, allocation, or appropriation) owed the employer, to withhold payment. The money must be withheld until (1) the employer pays the comptroller the past due premiums plus interest or (2) the treasurer or state officer determines that arrangements, satisfactory to the treasurer, have been made for paying the premiums and interest.

The bill prohibits the treasurer or state officer from withholding state money from the group if doing so impedes receipt of any federal grant or aid.

State Employee Plan Premium Account

The bill establishes a separate, nonlapsing state employee plan premium account in the General Fund. The comptroller must (1) deposit the premiums collected from nonstate public employers, employees, and retirees into this account and (2) administer the account to pay claims and administrative fees to entities providing coverage or services under the plan.

1-4 — MUNICIPAL HEALTHCARE DATA REPORTING

The bill creates several new requirements regarding healthcare data for municipalities, insurers of municipal employees, and the comptroller.

2 - Municipal Insurers' Report

By October 1, 2015, and annually thereafter, the bill requires certain entities to submit to the comptroller, for each covered municipal employer, the previous policy year's (1) complete medical, dental, and pharmaceutical utilization data, as applicable, and (2) annual claims paid, aggregated by practice type and service category, and reported separately for in- and out-of network providers and total number of claims paid. Covered municipal employers are municipalities and schools, taxing, or fire districts with at least 50 employees.

The reporting requirement applies to each insurer, health care center, hospital service corporation, medical service corporation, or other entity (1) delivering, issuing for delivery, renewing, amending, or continuing a covered employer's group health insurance policy and (2) providing either (a) only administrative services or (b) one of the specified types of coverage.

By law, policy issuers must provide this and other information to municipal employers upon request and the employer can provide it confidentially to the comptroller. The bill requires the reporting entities to submit this information electronically to the comptroller in a form prescribed by the comptroller, regardless of whether a covered municipal employer asked for the information. The disclosed information (1) can include only health information with identifiers removed, as required by federal regulations; (2) cannot be individually identifiable, as defined in federal regulations; and (3) must be allowed under the federal Health Insurance Portability and Accountability Act (HIPAA). The comptroller must keep the disclosed information confidential and it is not subject to state Freedom of Information Act disclosure.

1 — Municipal Report

By October 1, 2016, and annually thereafter, the bill requires municipalities that sponsor group health policies or plans that provide the types of coverage specified above for their active employees or retirees to submit information to the comptroller. The required information, which must be submitted electronically in a form prescribed by the comptroller, is:

1. a list of each of the municipality's offered group health policies or plans and their specific details including (a) covered benefits and benefit limits, (b) total premium costs or premium equivalent costs for each policy or plan, organized by coverage tier, including single, two-person, and family, including dependents, and (c) the employee, early retiree, or retiree share for each total premium cost;

2. cost-sharing requirements, such as coinsurance, copayments, deductibles, and other out-of-pocket expenses associated with in-network and out-of-network providers;

3. the value of any prescription drug plan rebates or cost reductions;

4. the total number of employees, early retirees, and retirees in each policy or plan, organized by (a) municipal department, (b) collective bargaining unit, if applicable, (c) coverage tier, and (d) active employee, early retiree, or retiree status; and

5. the percentage change in per-person policy or plan costs over the preceding two policy or plan years.

The bill prohibits municipalities from including health information in submitting this information.

3 — Comptroller's Working Group

The bill allows the comptroller to convene a temporary working group, from July 1, 2015 to June 30, 2016, to develop and establish health care provider payment reforms for the group health insurance plans offered state employees. The reforms can include multi-payer initiatives, patient-centered medical homes, primary care case management, value-based purchasing, and bundled purchasing.

The comptroller cannot require any parties to participate in the group, which can include:

1. health insurance companies, health care centers, hospital service corporations, medical service corporations, or other entities delivering, issuing for delivery, renewing, amending, or continuing group health insurance plans;

2. third-party administrators providing only administrative services for the state's self-insured plans;

3. health care providers;

4. health care facilities;

5. the Office of Policy and Management; and

6. state employees and retirees.

3 — Working Group Survey and Meetings

The bill allows the comptroller, or his designee, to (1) survey the non-governmental entities eligible to participate in the working group about payment delivery reforms and (2) convene working group meetings at a time and place convenient to all participants. The comptroller, or his designee, must ensure that the survey and working group participants do not solicit, share, or discuss pricing information.

The bill specifies that the survey and working group meetings are not (1) violations of the state's Anti-Trust Act or (2) subject to the state Freedom of Information Act's disclosure or notice requirements.

3 — Cooperative Agreements

The bill allows the comptroller to enter into cooperative agreements with any of the non-governmental entities eligible to participate in the working group if he determines that it will likely produce efficiencies and improvements in health care outcomes. The agreements can be to (1) identify and reward high-quality, low-cost health care providers or (2) create incentives for enrollees to (a) receive care from such providers or (b) promote personal health behaviors that prevent or effectively manage chronic diseases, including tobacco cessation, weight control, and physical activity.

The comptroller can establish guidelines for these agreements, which must be consistent with federal and state antitrust laws and Federal Trade Commission regulations.

3 — Report

By January 1, 2017, the comptroller must report to the Appropriations, Labor, and Public Health committees on the working group's recommendations. The report must include (1) any cost containment measures, (2) descriptions of any quality measurement or quality improvement initiatives implemented at the working group's recommendation, and (3) any cost savings or health outcome improvements associated with these measures or initiatives.

COMMITTEE ACTION

Labor and Public Employees Committee

Joint Favorable Substitute

Yea

6

Nay

5

(03/12/2015)