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Introduced Version Senate Bill 147 History

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Key: Green = existing Code. Red = new code to be enacted
Senate Bill No. 147

(By Senators Hunter, Kessler, Dempsey, Foster, Lanham, McCabe and Jenkins)

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[Introduced January 13, 2006; referred to the Committee on Labor; then to the Committee on Health and Human Resources; and then to the Committee on Finance.]

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A BILL to amend and reenact §9-4A-2a of the Code of West Virginia, 1931, as amended; and to amend said code by adding thereto a new article, designated §21-3E-1, §21-3E-2, §21-3E-3, §21-3E- 4, §21-3E-5, §21-3E-6, §21-3E-7, §21-3E-8 and §21-3E-9, all relating to the West Virginia Fair Share Health Care Act; title and purpose of act; definitions; assessments against large employers who spend fewer than eight percent or six percent of total wages on employee health care in this state; deposit of assessments by Commissioner of Labor in Medical Services Trust Fund; prohibition against passing cost of assessment on to employees; information required to be reported to the commissioner by every employer and manner of reporting; penalties for late reporting and failure to pay assessment; matters to be reported by the commissioner to the Governor and the Legislature; duties of commissioner; and severability.

Be it enacted by the Legislature of West Virginia:
That §9-4A-2a of the Code of West Virginia, 1931, as amended, be amended and reenacted; and that said code be amended by adding thereto a new article, designated §21-3E-1, §21-3E-2, §21-3E-3, §21-3E-4, §21-3E-5, §21-3E-6, §21-3E-7, §21-3E-8 and §21-3E-9, all to read as follows:
CHAPTER 9. HUMAN SERVICES.

ARTICLE 4A. MEDICAID UNCOMPENSATED CARE FUND
§ 9-4A-2a. Medical services trust fund.
(a) The Legislature finds and declares that certain dedicated revenues should be preserved in trust for the purpose of stabilizing the state's Medicaid program and providing services for future federally mandated population groups in conjunction with federal reform.
(b) There is hereby created a special account within the Department of Health and Human Resources, which shall be an interest-bearing account and may be invested in the manner permitted by section nine, article six, chapter twelve of this code, designated the Medical Services Trust Fund. Funds paid into the account shall be derived from the following sources:
(1) Transfers, by intergovernmental transfer, from the Hospital Services Revenue Account provided for in section fifteen-a, article one, chapter sixteen of this code;
(2) All interest or return on investment accruing to the Fund;
(3) Any gifts, grants, bequests, transfers or donations which may be received from any governmental entity or unit or any person, firm, foundation or corporation; and
(4) Any appropriations by the Legislature which may be made for this purpose; and
(5) Funds deposited by the Commissioner of Labor pursuant to article 3E, chapter 21 of this code.
(c) Expenditures from the Fund are limited to the following:
(1) Payment of backlogged billings from providers of Medicaid services when cash-flow problems within the Medical Services Fund do not permit payment of providers within federally required time limits; and
(2) Funding for services to future federally mandated population groups in conjunction with federal health care reform: Provided, That other Medicaid funds have been exhausted for the federally mandated expansion: Provided, however, That new optional services for which a state Medicaid plan amendment is submitted after the first day of May, one thousand nine hundred ninety-three, which are not cost effective for the State, are eliminated prior to expenditure of any moneys from this Fund for Medicaid expansion.
(3) Payment of the required state match for Medicaid disproportionate share payments in order to receive federal financial participation in the Disproportionate Share Hospital Program.
(d) Expenditures from the Fund solely for the purposes set forth in subsection (c) of this section shall be authorized in writing by the Governor, who shall determine in his or her discretion whether any expenditure shall be made, based on the best interests of the State as a whole and its citizens, and shall designate the purpose of the expenditure. Upon authorization signed by the Governor, funds may be transferred to the Medical Services Fund: Provided, That all expenditures from the Medical Services Trust Fund shall be reported forthwith to the Joint Committee on Government and Finance.
(e) Notwithstanding the provision of section two, article two, chapter twelve of this code, moneys within the Medical Services Trust Fund may not be redesignated for any purpose other than those set forth in subsection (c) of this section, except that, upon elimination of the Medicaid program in conjunction with federal health care reform, moneys within the fund may be redesignated for the purpose of providing health care coverage or services in coordination with federal reform.
CHAPTER 21. LABOR

ARTICLE 3E. WEST VIRGINIA FAIR SHARE HEALTH CARE ACT.
§21-3E-1. Short title.
This article may be referred to as the West Virginia Fair Share Health Care Act".
§21-3E-2. Purpose.
The purpose of this Act is to allow the State to uncompensated health care costs occasioned by the failure of large employers to provide adequate health care benefits for their employees in this state.
§21-3E-3. Definitions.
For purposes of this article, the following terms have the following definitions:
(1) "Commissioner" means the Commissioner of the State Divison of Labor.
(2)"Employee" means all individuals employed full time or part time directly by an employer.
(3) "Employer" means any person, firm or corporation employing 10,000 or more employees in this state. "Employer" does not include the federal government, the State of West Virginia, or another state, or a political subdivision of the State of West Virginia or of another state.
(4) "Fund" means the Medical Services Trust Fund created pursuant to section two, article four-a, chapter nine of this code.
(5) "Health insurance benefits" includes payments for medical care, prescription drugs, vision care, medical savings accounts, and any other costs to provide health benefits as defined in § 213(d) of the Internal Revenue Code.
(6) "Health insurance costs" means the amount paid by an employer to provide health care or health insurance to employees in this state to the extent the costs may be deductible by the an employer under federal tax law.
(7) "Secretary" means the Secretary of the Department of Health and Human Resources.
(8) "Wages" means compensation for labor or services rendered by an employee, whether the amount is determined on a salary, time, task, piece, commission or other basis of calculation.
§21-3E-4. Employer assessments; prohibition against deducting contributions from employee compensation.
On July 1, 2007, and annually thereafter:

(a) An employer that is organized as a nonprofit organization and does not spend at least six percent of the total wages paid for health care costs, shall pay to the Commissioner an amount equal to the difference between what the employer spends for health insurance costs and an amount equal to six percent of the total wages paid for health care costs.
(b) An employer that is not organized as a nonprofit organization and does not spend at least eight percent of the total wages paid for health care costs shall pay to the Commissioner an amount equal to the difference between what the employer spends for health insurance costs and an amount equal to eight percent of the total wages paid for health care costs.
(c) The Commissioner shall deposit all employer assessments under this section in the Fund.
(d) An employer may not deduct any payment made under subsection (a) or (b) of this section from the wages of an employee.
(e) An employer shall make the payment required under this section to the Commissioner on a periodic basis as determined by the Commissioner.
§21-3E-5. Reporting requirement for employers.
(a) On January 1, 2007, and annually thereafter, every employer in the State of West Virginia shall submit the following information, on a form and in a manner approved by the Commissioner:
(1) The number of employees employed in the state on January 1 of the previous year;
(2) The amount spent by the employer in the previous calendar year on health insurance costs for employees in the state; and
(3) The percentage of payroll that was spent by the employer in the previous calendar year on health insurance costs for employees in the state.
(b) The information required shall:
(1) Be designated in a report signed by the principal executive officer or an individual performing a similar function; and
(2) Include an affidavit under penalty of perjury that the information required under subsection (a) of this section:
(A) Was reviewed by the signing officer; and
(B) Was based on the officer's knowledge and does not contain any untrue statement of a material fact or omit a material fact to the best of the signing officer's knowledge, information, and belief.
(c) When calculating the percentage of payroll under subsection (a)(3) or the amount spent on health care under subsection (a)(2) of this section, an employer may exempt wages paid to an employee who is enrolled in or eligible for Medicare.
(d) The Commissioner shall adopt rules that specify the information an employer must submit under this section.
§21-3E-6. Penalties for late reporting and for non-payment of contributions.
(a) If an employer fails to report to the information required by section five of this article, the Commissioner shall impose a civil penalty of $250 for each day that the report is not timely filed.
(b) If an employer fails to make the payment required under section four of this article, the Commissioner shall impose a civil penalty of $250,000.
§21-3D-7. Report of the Commissioner to the Governor and the Legislature.
On or before February 1 2007, and annually thereafter, the Commissioner shall report to the Governor and to the Legislature the following information taken from the reports of employers filed on January 1 of that year:
(1) The name of each nonprofit and for profit employer with 10,000 or more employees in the state;
(2) The employer's definition of full-time employee and part- time employee;
(3) The number of full-time employees in the state;
(4) The number of full-time employees in the state eligible to receive health insurance benefits;
(5) The number of full-time employees in the state receiving health insurance benefits from the employer;
(6) The source of health insurance benefits for those eligible full-time employees in the state not receiving health insurance benefits through an employer subject to reporting under this title;
(7) The number of part-time employees in the state;
(8) The number of part-time employees in the state eligible to receive health insurance benefits;
(9) The number of part-time employees in the state receiving health insurance benefits from the employer; and
(10) The source of health insurance benefits for those eligible part-time employees in the state not receiving health insurance benefits through an employer subject to reporting under this title.
§21-3E-8. Duties of Commissioner.
The Commissioner shall:
(1) On an annual basis, based on the information reported under section five of this article:
(A) Verify which employers in the state have 10,000 or more employees in the state; and
(B) Ensure that all employers in the state with 10,000 or more employees in the state have made the report required;
(2) Adopt rules to implement this article;
(3) Pay the revenue from the payroll assessment into the Fund
.
(4) Propose rules, for promulgation in accordance with the provisions of article three, chapter twenty-nine-a of this code, governing the implementation of this article; and
(5) Not later than sixty days after the effective date of this article, propose emergency rules, for promulgation in accordance with the provisions of article three, chapter twenty-nine-a of this code, governing the implementation of this article.
§21-3E-9. Severability.
If any provision of this article, or the application thereof to any person or circumstance, is held unconstitutional or invalid by decision of a court of competent jurisdiction, that decision shall not affect other provisions or applications of this article, and to this end the provisions of this article are declared to be severable.

NOTE: The purpose of this bill is to allow the State to offset public health care costs occasioned by the failure of large employers to provide adequate health care benefits for their employees in this state by requiring employers with more than 10,000 employees in the state who spend less than 6% (non-profits) or 8% (for-profits) of their state payroll for employee health care to pay the difference to the Commissioner of Labor for deposit into the Medical Services Trust Fund. The bill imposes reporting requirements on covered employers and on the Commissioner and provides civil penalties on employers who delay of fail to report the required information and/or fail to pay the assessment.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added. Article 3E is new, therefore, strike-throughs and underscoring have been omitted.
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