Tennessee Code 8-27-303 – Payment of premiums – Eligibility of local education agency to receive direct payments – Deduction from retirement benefits for payment of insurance premiums
Commissioner: means any person in office as a member of the public service commission, as prescribed by title 65, chapter 1, prior to June 30, 1996. See Tennessee Code 8-34-101
Contract: A legal written agreement that becomes binding when signed.
Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
Instructional employee: means those persons employed by a local education agency as teachers, as defined in §. See Tennessee Code 8-27-301
Internal Revenue Code: means the Internal Revenue Code of 1986, codified in United States Code, title 26, as amended. See Tennessee Code 8-34-101
Local education insurance committee: means the local education insurance committee created in subsection (a). See Tennessee Code 8-27-301
Member: means any person included in the membership of the retirement system, as provided in chapter 35, part 1 of this title. See Tennessee Code 8-34-101
Person: includes a corporation, firm, company or association. See Tennessee Code 1-3-105
Retirement: means withdrawal from membership with a retirement allowance granted under chapters 34-37 of this title. See Tennessee Code 8-34-101
Retirement system: means the Tennessee consolidated retirement system as defined in §. See Tennessee Code 8-34-101
(1)(A) From the appropriations made each year in the general appropriations act for that purpose, the department of education is authorized to pay, on behalf of each eligible instructional employee of a local education agency, and the employee’s dependents, an amount, determined annually in the general appropriations act, on the total cost of the person‘s participation in the basic health plan.(B) Each local education agency shall pay on behalf of each instructional employee, participating in the health insurance coverage authorized by § 8-27-302(a), as a minimum, the percentage specified in the general appropriations act of the premium collected on behalf of each employee of the local education agency.(C) From the appropriations made each year in the general appropriations act for that purpose, the department of education is authorized to pay, on behalf of each eligible support staff employee of a local education agency, and the employee’s dependents, an amount, determined annually in the general appropriations act, on the total cost of the person’s participation in the basic health plan. The amount set for support staff employees may be different from the amount set in subdivision (a)(1)(B).(D) Each local education agency shall pay on behalf of each support staff employee, participating in the health insurance coverage authorized by § 8-27-302(a), at a minimum, the percentage specified in the general appropriations act of the premium collected on behalf of each support staff employee of the local education agency.(E) Distribution of a like amount to each eligible employee through a flexible spending arrangement authorized by § 125 of the Internal Revenue Code (26 U.S.C. § 125) shall satisfy the requirements of this subsection (a). The amounts shall be certified to the commissioner of education and the director of each local education agency by the local education insurance committee each fiscal year.(2) If a local education agency makes medical insurance available to its instructional employees and support staff employees and the benefits are equal or superior to the benefits of the basic health plan established pursuant to § 8-27-302(a), the local education agency shall be eligible to receive directly the payments provided for in subdivision (a)(1). Participation in an insurance trust, county-wide policy, self-insurance, or similar benefit plan shall not disqualify the local education agency from these payments. The determination of the equivalency or superiority of the local benefits shall be made by an outside, independent firm or consultant. The local education insurance committee shall contract with the firm or consultant under the procedures in § 8-27-103(a). A written report shall be supplied to the local education agency in the event that local medical benefits are determined not to be equal or superior. In order to be reviewed for eligibility, a local education agency shall make application to the local education insurance committee. Any local education agency whose insurance was determined to be inferior to the basic health plan shall be eligible to receive directly the payments provided for in subdivision (a)(1) if, upon evaluation by the local education insurance committee, the revised local insurance plan was determined to be equal or superior to the basic health plan. Section 8-27-305 shall not be used in determining the equivalency or superiority of the local benefits. Local education agencies shall not be eligible for direct payments without approval of the local education insurance committee.(3) A school boardmember of a local education agency may participate in the basic health plan as authorized in § 8-27-302(a)(1), if the member pays the total monthly premium for the coverage the member selects. The department of education shall not assume any liability for such participation, and the total cost of such a person’s participation shall be borne by the individual, unless the local education agency assumes liability for all or a portion of the cost. Nothing contained herein shall require the termination or modification of existing insurance plans covering a local education agency’s retired teachers or other employees.(b) Each person for whom payments are made under subsection (a) shall pay the remaining portion of the total costs, but the board of the local education agency may assume all or a portion of these costs.(c) The additional cost of voluntary coverage provided for by § 8-27-302(a)(2) shall be paid by the participating local education agency and its participating employees.(d) All administrative costs incurred by the state group insurance office or the insurer that are associated with the administration of the basic plans or the Medicare supplement plan offered herein shall be borne by the plan and included in the premium payments.(e)(1) Payments made by the state in accordance with subsection (a) may be made by direct transfer from the state treasury to the plan, by payroll deduction, or otherwise as the local education insurance committee and the department of finance and administration deem most efficient. These payments shall not be subject to § 8-11-110.(2) Payments due from local education agencies or participating employees shall be made as directed by the local education insurance committee.(f) The local education insurance committee shall periodically evaluate local plans determined to be equal or superior to the basic plan to ensure that such plans maintain benefits equal or superior to the basic health plan. Local education agencies shall fully cooperate with the local education insurance committee in these evaluations. The local education insurance committee shall issue a written report to the local education agency explaining the results of the evaluations, giving the agency an opportunity to respond to the local education insurance committee’s findings. If, as a result of an evaluation, a local plan is determined to be inferior to the basic health plan, the local education insurance committee shall discontinue direct payments to the affected local education agency not later than ninety (90) days after the final determination by the local education insurance committee. During this period of time, the local education agency may implement improved benefits in the local plan and submit the revised local plan for evaluation. If the local education insurance committee determines that the revised local plan is equal or superior to the basic health plan, direct payments to the agency may continue. If benefits in the local plan are not improved or the revised local plan is determined inferior to the basic health plan, the local education agency may elect to:
(1) Enroll in the basic health plan pursuant to §§ 8-27-302 and 8-27-304; or(2) Maintain the local plan and not receive state support for the local plan.(g) Local education agencies whose local insurance plan is determined equal or superior to the basic health plan shall file with the local education insurance committee any changes in the benefits offered under the local plan at least thirty (30) days prior to the effective date of the changes.(h)(1) The local education insurance committee shall provide for the financing of the plan, including the disposition of government grants and subsidies to assist in the funding and provision of health insurance for enrolled individuals.(2) Local education agencies enrolled in the plan shall cooperate with the local education insurance committee in implementing and complying with the determinations of the local education insurance committee as set forth in subdivision (h)(1). This cooperation includes entering into contracts or memoranda of understanding reflecting the financial determinations of the local education insurance committee.(3) The local education insurance committee is authorized to take either or both of the following actions in response to a local education agency’s failure to cooperate with the local education insurance committee as required by this section:
(A) Assess and collect from the local education agency the costs incurred by the agency’s failure to cooperate; and(B) Terminate the local education agency’s participation in the plan.(4) The termination of the local education agency’s participation shall be in effect for two (2) years, and shall be in effect regardless of any language in this chapter to the contrary regarding reinstatement to the plan.(5) The local education agency shall have the right to request reconsideration of its exclusion before the local education insurance committee. The local education insurance committee’s decision of the request for reconsideration shall be final.(i) The Tennessee consolidated retirement system is authorized to make deductions from the retirement benefits that any retired teacher or other retired local government employee receives from the Tennessee consolidated retirement system for payment of insurance premiums for any local government group insurance coverage provided to such retirees.
