00                             SENATE BILL NO. 90                                                                          
01 "An Act relating to group insurance coverage and self-insurance coverage for school                                     
02 district employees; and providing for an effective date."                                                               
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1. AS 14.08.111 is amended to read:                                                                      
05            Sec. 14.08.111. Duties. A regional school board shall                                                      
06                 (1)  provide, during the school term of each year, an educational                                       
07       program for each school age child who is enrolled in or a resident of the district;                               
08                 (2)  develop a philosophy of education, principles, and goals for its                                   
09       schools;                                                                                                          
10                 (3)  approve the employment of the professional administrators,                                         
11       teachers, and noncertificated personnel necessary to operate its schools;                                         
12                 (4)  establish the salaries to be paid its employees;                                                   
13                 (5)  designate the employees authorized to direct disbursements from                                    
14       the school funds of the board;                                                                                    
01                 (6)  submit the reports prescribed for all school districts;                                            
02                 (7)  provide for an annual audit in accordance with AS 14.14.050;                                       
03                 (8)  provide custodial services and routine maintenance of school                                       
04       buildings and facilities;                                                                                         
05                 (9)  establish procedures for the review and selection of all textbooks                                 
06       and instructional materials, including textbooks and curriculum materials for statewide                           
07       correspondence programs, before they are introduced into the school curriculum; the                               
08       review includes a review for violations of AS 14.18.060; nothing in this paragraph                                
09       precludes a correspondence study student, or the parent or guardian of a                                          
10       correspondence study student, from privately obtaining or using textbooks or                                      
11       curriculum material not provided by the school district;                                                          
12                 (10)  provide prospective employees with information relating to the                                    
13       availability and cost of housing in rural areas to which they might be assigned, and,                             
14       when possible, assist them in locating housing; however, nothing in this paragraph                                
15       requires a regional school board to provide teacher housing, whether owned, leased, or                            
16       rented or otherwise provided by the regional educational attendance area, nor does it                             
17       require the board to engage in a subsidy program of any kind with respect to teacher                              
18       housing; [AND]                                                                                                    
19                 (11)  train persons required to report under AS 47.17.020, in the                                       
20       recognition and reporting of child abuse, neglect, and sexual abuse of a minor; and                           
21                 (12)  establish and maintain participation in a policy of group                                     
22       insurance as required by AS 14.20.137.                                                                        
23    * Sec. 2. AS 14.17.300 is amended by adding new subsections to read:                                               
24            (c)  Notwithstanding (a) and (b) of this section, the commissioner of                                        
25       administration                                                                                                    
26                 (1)  may expend from the public education fund to the group health and                                  
27       life benefits fund under AS 39.30.095 amounts necessary for the commissioner of                                   
28       administration to pay claims submitted by school district employees who are covered                               
29       by a policy of self-insurance that is provided by the Department of Administration                                
30       under AS 39.30.091;                                                                                               
31                 (2)  shall, over a period of 10 years from the date the first expenditure                               
01       authorized under this subsection occurs, reimburse the public education fund for                                  
02       money expended under this section from the public education fund.                                                 
03            (d)  Total expenditures from the public education fund under (c) of this section                             
04       may not exceed $100,000,000.                                                                                      
05    * Sec. 3. AS 14.20 is amended by adding a new section to read:                                                     
06            Sec. 14.20.137. School district employee health insurance. (a) Beginning not                               
07       later than July 1, 2015, a school district shall participate in a policy of insurance                             
08       selected by the commissioner of administration that includes health insurance                                     
09       coverage of employees. The commissioner of administration shall select either a                                   
10       policy of group insurance under AS 39.30.090 that covers state employees and                                      
11       employees of the school district, or a policy of self-insurance, provided by the                                  
12       Department of Administration under AS 39.30.091, that provides insurance coverage                                 
13       to state employees and employees of the school district.                                                          
14            (b)  Subject to (e) of this section, the school district shall contribute to the                             
15       group health and life benefits fund established under AS 39.30.095 an amount equal to                             
16       the rate of employer contribution and the rate of employee contribution set by the                                
17       commissioner of administration under AS 39.30.095.                                                                
18            (c)  In addition to the contribution required under (b) of this section and the                              
19       reimbursement required under (d) of this section, a school district shall reimburse the                           
20       Department of Administration an amount equal to the state's cost, if any, of procuring                            
21       necessary excess loss insurance in connection with coverage of the school district's                              
22       employees under AS 39.30.091.                                                                                     
23            (d)  In addition to the contribution required under (b) of this section and the                              
24       reimbursement required under (c) of this section, a school district shall reimburse the                           
25       Department of Administration the cost of paying insurance claims for the first four                               
26       months employees of the school district are covered by a policy of self-insurance                                 
27       under AS 39.30.091. The commissioner of administration shall allow the                                            
28       reimbursement to be made in equal installments over a period not to exceed 10 years                               
29       from the date the school district's participation in the policy begins.                                           
30            (e)  Subject to AS 23.40.070 - 23.40.260 (Public Employee Relations Act), a                                  
31       school district may require employees of the school district to pay some or all of the                            
01       school district's contribution under (b) of this section and reimbursement under (c) and                          
02       (d) of this section.                                                                                              
03            (f)  In this section, "school district" means a municipal school district or a                               
04       regional educational attendance area.                                                                             
05    * Sec. 4. AS 39.30.090(a) is amended to read:                                                                      
06            (a)  The Department of Administration may obtain a policy or policies of group                               
07       insurance covering state employees and school district employees, persons entitled to                         
08       coverage under AS 14.25.168, 14.25.480, AS 22.25.090, AS 39.35.535, 39.35.880, or                                 
09       former AS 39.37.145, employees of other participating governmental units, or persons                              
10       entitled to coverage under AS 23.15.136, subject to the following conditions:                                     
11                 (1)  A group insurance policy shall provide one or more of the                                          
12       following benefits: life insurance, accidental death and dismemberment insurance,                                 
13       weekly indemnity insurance, hospital expense insurance, surgical expense insurance,                               
14       dental expense insurance, audiovisual insurance, or other medical care insurance.                                 
15                 (2)  Each eligible employee of the state or a school district, the spouse                           
16       and the unmarried children chiefly dependent on the eligible employee for support,                                
17       and each eligible employee of another participating governmental unit shall be                                    
18       covered by the group policy, unless exempt under regulations adopted by the                                       
19       commissioner of administration.                                                                                   
20                 (3)  A governmental unit may participate under a group policy if                                        
21                      (A)  its governing body adopts a resolution authorizing                                            
22            participation, and payment of required premiums;                                                             
23                      (B)  a certified copy of the resolution is filed with the                                          
24            Department of Administration; and                                                                            
25                      (C)  the commissioner of administration approves the                                               
26            participation in writing.                                                                                    
27                 (4)  In procuring a policy of group health or group life insurance as                                   
28       provided under this section or excess loss insurance as provided in AS 39.30.091, the                             
29       Department of Administration shall comply with the dual choice requirements of                                    
30       AS 21.86.310, and shall obtain the insurance policy from an insurer authorized to                                 
31       transact business in the state under AS 21.09, a hospital or medical service corporation                          
01       authorized to transact business in this state under AS 21.87, or a health maintenance                             
02       organization authorized to operate in this state under AS 21.86. An excess loss                                   
03       insurance policy may be obtained from a life or health insurer authorized to transact                             
04       business in this state under AS 21.09 or from a hospital or medical service corporation                           
05       authorized to transact business in this state under AS 21.87.                                                     
06                 (5)  The Department of Administration shall make available bid                                          
07       specifications for desired insurance benefits or for administration of benefit claims and                         
08       payments to (A) all insurance carriers authorized to transact business in this state                              
09       under AS 21.09 and all hospital or medical service corporations authorized to transact                            
10       business under AS 21.87 who are qualified to provide the desired benefits; and (B) to                             
11       insurance carriers authorized to transact business in this state under AS 21.09, hospital                         
12       or medical service corporations authorized to transact business under AS 21.87, and                               
13       third-party administrators licensed to transact business in this state and qualified to                           
14       provide administrative services. The specifications shall be made available at least                              
15       once every five years. The lowest responsible bid submitted by an insurance carrier,                              
16       hospital or medical service corporation, or third-party administrator with adequate                               
17       servicing facilities shall govern selection of a carrier, hospital or medical service                             
18       corporation, or third-party administrator under this section or the selection of an                               
19       insurance carrier or a hospital or medical service corporation to provide excess loss                             
20       insurance as provided in AS 39.30.091.                                                                            
21                 (6)  If the aggregate of dividends payable under the group insurance                                    
22       policy exceeds the governmental unit's share of the premium, the excess shall be                                  
23       applied by the governmental unit for the sole benefit of the employees.                                           
24                 (7)  A person receiving benefits under AS 14.25.110, AS 22.25,                                          
25       AS 39.35, or former AS 39.37 may continue the life insurance coverage that was in                                 
26       effect under this section at the time of termination of employment with the state or                              
27       participating governmental unit.                                                                                  
28                 (8)  A person electing to have insurance under (7) of this subsection                                   
29       shall pay the cost of this insurance.                                                                             
30                 (9)  For each permanent part-time employee electing coverage under                                      
31       this section, the state shall contribute one-half the state contribution rate for permanent                       
01       full-time state employees, and the permanent part-time employee shall contribute the                              
02       other one-half.                                                                                                   
03                 (10)  A person receiving benefits under AS 14.25, AS 22.25, AS 39.35,                                   
04       or former AS 39.37 may obtain auditory, visual, and dental insurance for that person                              
05       and eligible dependents under this section. The level of coverage for persons over 65                             
06       shall be the same as that available before reaching age 65 except that the benefits                               
07       payable shall be supplemental to any benefits provided under the federal old age,                                 
08       survivors, and disability insurance program. A person electing to have insurance under                            
09       this paragraph shall pay the cost of the insurance. The commissioner of administration                            
10       shall adopt regulations implementing this paragraph.                                                              
11                 (11)  A person receiving benefits under AS 14.25, AS 22.25, AS 39.35,                                   
12       or former AS 39.37 may obtain long-term care insurance for that person and eligible                               
13       dependents under this section. A person who elects insurance under this paragraph                                 
14       shall pay the cost of the insurance premium. The commissioner of administration shall                             
15       adopt regulations to implement this paragraph.                                                                    
16                 (12)  Each licensee holding a current operating agreement for a vending                                 
17       facility under AS 23.15.010 - 23.15.210 shall be covered by the group policy that                                 
18       applies to governmental units other than the state.                                                               
19    * Sec. 5. AS 39.30.090(b) is amended by adding a new paragraph to read:                                            
20                 (4)  "school district" means a municipal school district or a regional                                  
21       educational attendance area.                                                                                      
22    * Sec. 6. AS 39.30.091 is amended to read:                                                                         
23            Sec. 39.30.091. Authorization for self-insurance and excess loss insurance.                                
24       Notwithstanding AS 21.86.310 or AS 39.30.090, the Department of Administration                                    
25       may provide, by means of self-insurance, one or more of the benefits listed in                                    
26       AS 39.30.090(a)(1) for state employees or employees of a school district who are                              
27       eligible for the benefits by law or under a collective bargaining agreement and for                               
28       persons receiving benefits under AS 14.25, AS 22.25, AS 39.35, or former AS 39.37,                                
29       and their dependents. The department shall procure any necessary excess loss                                      
30       insurance under AS 39.30.090.                                                                                     
31    * Sec. 7. AS 39.30.091 is amended by adding new subsections to read:                                               
01            (b)  If the department is required by (a) of this section to procure excess loss                             
02       insurance in connection with coverage of a school district's employees, the department                            
03       may allocate the cost of that insurance across all school districts that are covered by                           
04       self-insurance provided by the department under this section.                                                     
05            (c)  In this section, "school district" means a municipal school district or a                               
06       regional educational attendance area.                                                                             
07    * Sec. 8. AS 39.30.098 is amended to read:                                                                         
08            Sec. 39.30.098. Regulations. The commissioner of administration may adopt                                  
09       regulations to implement AS 39.30.090 - 39.30.097. Regulations adopted [BY THE                                    
10       COMMISSIONER] under this section are [RELATE TO THE INTERNAL                                                  
11       MANAGEMENT OF STATE AGENCIES, AND THEIR ADOPTION IS] not subject                                                  
12       to AS 44.62 (Administrative Procedure Act).                                                                       
13    * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to                          
14 read:                                                                                                                   
15       APPLICABILITY. Sections 1 - 8 and 10 of this Act apply to a contract or collective                                
16 bargaining agreement that becomes legally binding on or after the effective date of secs. 1 - 8                         
17 and 10 of this Act.                                                                                                     
18    * Sec. 10. The uncodified law of the State of Alaska is amended by adding a new section to                         
19 read:                                                                                                                   
20       TRANSITION. A school district that maintains a self-funded insurance reserve before                               
21 the effective date of secs. 1 - 8 and 10 of this Act for the purpose of paying employee health                          
22 insurance claims shall transfer the closing balance of that reserve to the group health and life                        
23 benefits fund under AS 39.30.095 not later than 30 days after enrolling in a health care plan                           
24 administered by the state under AS 39.30.090 or 39.30.091. An amount transferred by a                                   
25 school district under this section shall be applied to offset reimbursement owed by that school                         
26 district under AS 14.20.137(d) as enacted in sec. 3 of this Act.                                                        
27    * Sec. 11. The uncodified law of the State of Alaska is amended by adding a new section to                         
28 read:                                                                                                                   
29       REGULATIONS. The commissioner of administration shall adopt regulations                                           
30 necessary to implement the changes made by this Act. The regulations may take effect after                              
31 the effective date of the law implemented by the regulation.                                                            
01    * Sec. 12. Sections 10 and 11 of this Act take effect immediately under AS 01.10.070(c).                           
02    * Sec. 13. Except as provided in sec. 12 of this Act, this Act takes effect July 1, 2014.