PA 10-57—HB 5402
AN ACT CONCERNING EXPENSES FOR HEALTH BENEFIT PLANS UNDER THE TEACHERS' RETIREMENT FUND
SUMMARY: This act allows the Teachers' Retirement Board (TRB) to pay professional consultant fees for administering TRB retiree health plans, up to $150,000 per year, from the Retired Teachers' Health Insurance Premium Fund instead of the General Fund (see BACKGROUND).
It also requires TRB, when it determines that a member irrevocably retired based on a retirement benefit estimate issued on or after November 1, 2008 that contains a material error, to pay the member the benefits specified in the estimate. Under the act, a “material error” means that the estimate was off by 10% or more.
Finally, the act makes technical changes.
EFFECTIVE DATE: Upon passage for the provision concerning consultant fees and October 1, 2010 for the one relating to benefit estimates.
ERROR IN BENEFIT ESTIMATE
TRB must pay benefits specified in an erroneous benefit estimate if it determines that:
1. the error is material, that is, the difference between the estimated benefits and those to which the member would otherwise be entitled is 10% or more;
2. the member received the estimate on or after November 1, 2008;
3. the member could not reasonably be expected to detect the error; and
4. relying on the estimate, the member (a) irrevocably resigned from his or her job and (b) submitted a formal retirement application to TRB.
Retired Teachers' Health Insurance Premium Fund
The Retired Teachers' Health Insurance Premium Fund subsidizes state and local health insurance coverage for retired teachers. Money in the fund comes from contributions by the state (although the state has suspended its contributions for FY 10 and FY 11), retired and active teachers, and the federal Medicare Part D (prescription drug benefit) subsidy.
TRB Health Care Consultant
The TRB's health care consultant provides services such as calculating premiums, preparing cost analyses for health plan changes, writing requests for proposals for health care vendor services, maintaining the health fund model used for forecasting financial needs for benefits, and training TRB staff.
OLR Tracking: JSL: JKL: PF: ts