Forty-ninth Legislature
Second Regular Session
COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND ENTITLEMENT REFORM
HOUSE OF REPRESENTATIVES
AMENDMENTS TO H.B. 2389
(Reference to printed bill)
1 Page 15, between lines 21
and 22, insert:
2 "Sec.
5. Section 38-783, Arizona Revised Statutes, is
amended to read:
3 38-783.
Retired members; dependents; health insurance premium
4 payment;
separate account; definitions
5 A.
Subject to subsections G, H and I F, G AND H of this section, the
6 board
shall pay from ASRS assets part of the single coverage premium of any
7 health and accident
insurance for each retired, contingent annuitant or
8 disabled member of ASRS if
the member elects to participate in the coverage
9 provided by ASRS or
section 38-651.01 or elects to participate in a health
10 and accident insurance program
provided or administered by an employer or
11 paid for, in whole or in part,
by an employer to an insurer. A contingent
12 annuitant must be receiving a monthly
retirement benefit from ASRS in order
13 to obtain
any premium payment provided by this section. The board shall pay:
14 1. Up to one hundred fifty
dollars per month for a member of ASRS who
15 is not
eligible for medicare if the retired or disabled
member has ten or
16 more years
of credited service.
17 2. Up to one hundred dollars
per month for each member of ASRS who is
18 eligible
for medicare if the retired or disabled member has
ten or more years
19 of credited
service.
20 B.
Subject to subsections G, H and I F, G AND H of this section, the
21 board
shall pay from ASRS assets part of the family coverage premium of any
22 health and accident insurance
for a retired, contingent annuitant or disabled
23 member
of ASRS who elects family coverage and who otherwise qualifies for
24 payment
pursuant to subsection A of this section. If a member of ASRS and
25 the member's spouse
are both either retired or disabled under ASRS and apply
26 for family coverage, the member
who elects family coverage is entitled to
27 receive the payments under this
section as if they were both applying under a
28 single coverage premium unless
the payment under this section for family
29 coverage is greater. Payment under
this subsection is in the following
30 amounts:
31 1. Up to two
hundred sixty dollars per month if the member of ASRS and
32 one or more dependents are not
eligible for medicare.
33 2. Up to one hundred seventy
dollars per month if the member of ASRS
34 and one or more dependents are
eligible for medicare.
35 3. Up to two hundred fifteen
dollars per month if either:
1 (a)
The member of ASRS is not eligible for medicare and one or more
2 dependents are eligible
for medicare.
3 (b)
The member of ASRS is eligible for medicare
and one or more
4 dependents are not
eligible for medicare.
5 C.
In addition each retired, contingent annuitant or disabled member
6 of ASRS with less than ten
years of credited service and a dependent of such
7 a retired, contingent
annuitant or disabled member who elects to participate
8 in the coverage provided
by ASRS or section 38-651.01 or who elects to
9 participate in a health
and accident insurance program provided or
10 administered by an employer or
paid for, in whole or in part, by an employer
11 to an insurer is entitled to
receive a proportion of the full benefit
12 prescribed
by subsection A or B of this section according to the following
13 schedule:
14 1. 9.0 to 9.9 years of
credited service, ninety per cent.
15 2. 8.0 to 8.9 years of
credited service, eighty per cent.
16 3. 7.0 to 7.9 years of
credited service, seventy per cent.
17 4. 6.0 to 6.9 years of
credited service, sixty per cent.
18 5. 5.0 to 5.9 years of
credited service, fifty per cent.
19 6. Those with less than five
years of credited service do not qualify
20 for the
benefit.
21 D.
The board shall not pay more than the amount prescribed in this
22 section for a member of ASRS.
23 E.
A retired, contingent annuitant or disabled member of ASRS may
24 elect
to purchase individual health care coverage and receive a payment
25 pursuant
to this section through the retired or disabled member’s employer if
26 that
employer assumes the administrative functions associated with the
27 payment,
including verification that the payment is used to pay for health
28 insurance
coverage if the payment is made to the retired or disabled member.
29 F.
E. The board shall establish a separate account that consists of
30 the
benefits provided by this section. The board shall not use or divert any
31 part of the corpus or income of
the account for any purpose other than the
32 provision of benefits under this
section unless the liabilities of ASRS to
33 provide the benefits are
satisfied. If the liabilities of ASRS to provide
34 the benefits described in this
section are satisfied, the board shall return
35 any amount remaining in the
account to the employer.
36 G.
F. Payment of the benefits provided by this section is subject to
37 the following conditions:
38 1. The payment of the benefits
is subordinate to the payment of
39 retirement
benefits payable by ASRS.
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1 2. The total of contributions
for the benefits and actual
2 contributions for life
insurance protection, if any, shall not exceed
3 twenty-five per cent of
the total actual employer and employee contributions
4 to ASRS, less
contributions to fund past service credits, after the day the
5 account
is established.
6 3. The board shall deposit the
benefits provided by this section in
7 the
account.
8 4. The contributions by the
employer to the account shall be
9 reasonable
and ascertainable.
10 H.
G. A member who elects to receive a retirement benefit pursuant to
11 section
38-760, subsection B, paragraph 1 may elect at the time of retirement
12 an optional form of health and
accident insurance premium benefit payment
13 pursuant to this subsection as
follows:
14 1. The
optional premium benefit payment shall be an amount prescribed
15 by subsection A, B or C of this
section that is actuarially reduced to the
16 retiring
member for life. The amount of the optional premium benefit payment
17 shall be the actuarial
equivalent of the premium benefit payment to which the
18 retired
member would otherwise be entitled. The election in a manner
19 prescribed by the board shall
name the contingent annuitant and may be
20 revoked at any time before the
retiring member's effective date of
21 retirement.
At any time after benefits have commenced, the member may name a
22 different contingent annuitant
or rescind the election by written notice to
23 the board as follows:
24 (a)
If the retired member names a different contingent annuitant, the
25 optional premium benefit payment
shall be adjusted to the actuarial
26 equivalent of the original
premium benefit payment based on the age of the
27 new
contingent annuitant. The adjustment shall include all Postretirement
28 increases or decreases in
amounts prescribed by subsection A, B or C of this
29 section
that are authorized by law after the retired member's date of
30 retirement.
Payment of this adjusted premium benefit payment shall continue
31 under the provisions of the
optional premium benefit payment previously
32 elected by the retired member. A
retired member cannot name a different
33 contingent annuitant if the
retired member has at any time rescinded the
34 optional
form of health and accident insurance premium benefit payment.
35 (b)
If the retired member rescinds the election, the retired member
36 shall thereafter receive the
premium benefit payment that the retired member
37 would otherwise be entitled to
receive if the retired member had not elected
38 the optional premium benefit
payment, including all postretirement increases
39 or decreases in amounts
prescribed by subsection A, B or C of this section
40 that are
authorized by law after the member's date of retirement. The
-3-
1 increased benefit payment
shall continue during the remainder of the retired
2 member's
lifetime. The decision to rescind shall be irrevocable.
3 2. If at the time of the retired
member's death:
4 (a) The retired member was receiving a reduced premium benefit
payment
5 based on an amount
prescribed in subsection B or C of this section and the
6 contingent
annuitant is eligible for family health and accident insurance w
7 coverage,
the contingent annuitant is entitled to receive a premium benefit
8 payment based on an amount
prescribed in subsection B or C of this section
9 times the reduction factor
applied to the retired member's premium benefit
10 payment times the joint and
survivor option reduction factor elected by the
11 retired
member at the time of retirement pursuant to section 38-760,
12 subsection B, paragraph 1.
13 (b) The retired member was receiving a reduced premium benefit
payment
14 based on an amount prescribed in
subsection A or C of this section and the
15 contingent
annuitant is eligible for single health and accident insurance
16 coverage,
the contingent annuitant is entitled to receive a premium benefit
17 payment based on an amount
prescribed in subsection A or C of this section
18 times the reduction factor
applied to the retired member's premium benefit
19 payment times the joint and
survivor option reduction factor elected by the
20 retired member at the time of
retirement pursuant to section 38-760,
21 subsection B, paragraph 1.
22 (c) The
retired member was receiving a reduced premium benefit payment
23 based on an amount prescribed in
subsection B or C of this section and the
24 contingent
annuitant is not eligible for family health and accident insurance
25 coverage,
the contingent annuitant is entitled to receive a premium benefit
26 payment based on an amount
prescribed in subsection A or C of this section
27 times the reduction factor
applied to the retired member's premium benefit
28 payment times the joint and
survivor option reduction factor elected by the
29 retired
member at the time of retirement pursuant to section 38-760,
30 subsection B, paragraph 1.
31 I.
H. A member who elects to receive a retirement benefit pursuant to
32 section
38-760, subsection B, paragraph 2 may elect at the time of retirement
33 an optional form of health and
accident insurance premium benefit payment
34 pursuant to this subsection as
follows:
35 1. The optional premium
benefit payment shall be an amount prescribed
36 by subsection A, B or C of this
section that is actuarially reduced with
37 payments for five, ten or
fifteen years that are not dependent on the
38 continued lifetime of the
retired member but whose payments continue for the
39 retired member's lifetime beyond
the five, ten or fifteen year period. The
40 election
in a manner prescribed by the board shall name the contingent
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1 annuitant and may be
revoked at any time before the retiring member's
2 effective
date of retirement. At any time after benefits have commenced, the
3 member
may name a different contingent annuitant or rescind the election by
4 written
notice to the board. If the retired member rescinds the election,
5 the retired member shall
thereafter receive the premium benefit payment that
6 the retired member would
otherwise be entitled to receive if the retired
7 member
had not elected the optional premium benefit payment, including all
8 postretirement increases
or decreases in amounts prescribed by subsection A,
9 B or C of this section
that are authorized by law after the member's date of
10 retirement.
The increased benefit payment shall continue during the
11 remainder of the retired
member's lifetime. The decision to rescind shall be
12 irrevocable.
13 2. If, at the time of the
retired member's death:
14 (a) The retired member was receiving a reduced premium benefit
payment
15 based on an amount prescribed in
subsection B or C of this section and the
16 contingent
annuitant is eligible for family health and accident insurance
17 coverage,
the contingent annuitant is entitled to receive a premium benefit
18 payment based on an amount
prescribed in subsection B or C of this section
19 times the period certain and
life option reduction factor elected by the
20 retired member at the time of
retirement pursuant to section 38-760,
21 subsection B, paragraph 2.
22 (b) The retired member was receiving a reduced premium benefit
payment
23 based on an amount prescribed in
subsection A or C of this section and the
24 contingent
annuitant is eligible for single health and accident insurance
25 coverage,
the contingent annuitant is entitled to receive a premium benefit
26 payment based on an amount
prescribed in subsection A or C of this section
27 times the period certain and
life option reduction factor elected by the
28 retired member at the time of
retirement pursuant to section 38-760,
29 subsection B, paragraph 2.
30 (c) The
retired member was receiving a reduced premium benefit payment
31 based on an amount prescribed in
subsection B or C of this section and the
32 contingent
annuitant is not eligible for family health and accident insurance
33 coverage,
the contingent annuitant is entitled to receive a premium benefit
34 payment based on an amount
prescribed in subsection A or C of this section
35 times the period certain and
life option reduction factor elected by the
36 retired member at the time of
retirement pursuant to section 38-760,
37 subsection B, paragraph 2.
38 J.
I. If, at the time
of retirement, a retiring member does not elect
39 to receive
a reduced premium benefit payment pursuant to subsection H G or
-5-
1 I
H of this section, the retired member's contingent annuitant is not
2 eligible at any time for
the optional premium benefit payment.
3 K.
J. A contingent annuitant is not eligible for any premium benefit
4 payment
if the contingent annuitant was not enrolled in an eligible health
5 and accident insurance
plan at the time of the retired member's death or if
6 the contingent annuitant
is not the dependent beneficiary or insured
7 surviving dependent as
provided in section 38-782.
8 L.
K. For the purposes of this section:
9 1. "Account" means
the separate account established pursuant to
10 subsection F
E of this section.
11 2. "Credited
service" includes prior service.
12 3. "Prior service"
means service for this state or a political
13 subdivision
of this state before membership in the defined contribution
14 program administered by
ASRS."
15 Renumber to conform
16 Page 16, after line 9,
insert:
17 "Sec.
8. Insurance subsidy payments received through retired employer
18 A
retired, contingent annuitant or disabled member of the Arizona state
19 retirement system who is
receiving the payments allowed by section 38-783,
20 Arizona Revised Statutes,
through the retired or disabled member's employer
21 on the effective date of this
act may continue to receive such a payment as
22 long as the
retired member's employer assumes the administrative functions
23 associated with the
payment."
24 Amend title to conform
and, as so amended, it do pass
TOM
BOONE
Chairman
2389-perer
2/2/10
H:jmb
2389tb.doc
01/29/2010
2:14 PM
C: mo
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