H. B. 4086
(By Delegates J. Martin, Varner, Love,
Nesbitt and Stalnaker)
[Introduced January 17, 1996; referred to the
Committee on Government Organization.]
A BILL to repeal section sixteen, article sixteen, chapter five
of the code of West Virginia, one thousand nine hundred
thirty-one, as amended; and to amend and reenact sections
two, three and eight of said article sixteen, relating to
repealing provisions of code creating a public insurance
agency advisory board and terminating said board on the
first day of July, one thousand nine hundred ninety-six.
Be it enacted by the Legislature of West Virginia:
That section sixteen, article sixteen, chapter five of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be repealed; and that sections two, three and eight of
said article sixteen be amended and reenacted to read as follows:
ARTICLE 16. WEST VIRGINIA PUBLIC EMPLOYEES INSURANCE ACT.
§5-16-2. Definitions.
The following words and phrases as used in this article,
unless a different meaning is clearly indicated by the context,
shall have the following meanings:
(1) "Advisory board" means the public employees insurance agency advisory board created by this article.
(2)(1) "Agency" means the public employees insurance agency
created by this article.
(3)(2) "Director" means the director of the public employees
insurance agency, created by this article.
(4)(3) "Employee" means any person, including elected
officers, who works regularly full time in the service of the
state of West Virginia and, for the purpose of this article only,
the term "employee" also means any person, including elected
officers, who works regularly full time in the service of a
county board of education; a county, city or town in the state;
any separate corporation or instrumentality established by one or
more counties, cities or towns, as permitted by law; any
corporation or instrumentality supported in most part by
counties, cities or towns; any public corporation charged by law
with the performance of a governmental function and whose
jurisdiction is coextensive with one or more counties, cities or
towns; any comprehensive community mental health center or
comprehensive mental retardation facility established, operated
or licensed by the secretary of health and human resources
pursuant to section one, article two-a, chapter twenty-seven of
this code, and which is supported in part by state, county or
municipal funds; any person who works regularly full time in the
service of the university of West Virginia board of trustees or
the board of directors of the state college system; and any
person who works regularly full time in the service of a combined
city-county health department created pursuant to article two, chapter sixteen of this code. On and after the first day of
January, one thousand nine hundred ninety-four, and upon election
by a county board of education to allow elected board members to
participate in the public employees insurance program pursuant to
this article, any person elected to a county board of education
shall be deemed to be an "employee" during the term of office of
the elected member: Provided, That the elected member shall pay
the entire cost of the premium if he or she elects to be covered
under this act. Any matters of doubt as to who is an employee
within the meaning of this article shall be decided by the
director.
(5)(4) "Employer" means the state of West Virginia, its
boards, agencies, commissions, departments, institutions or
spending units; a county board of education; a county, city or
town in the state; any separate corporation or instrumentality
established by one or more counties, cities or towns, as
permitted by law; any corporation or instrumentality supported in
most part by counties, cities or towns; any public corporation
charged by law with the performance of a governmental function
and whose jurisdiction is coextensive with one or more counties,
cities or towns; any comprehensive community mental health center
or comprehensive mental retardation facility established,
operated or licensed by the secretary of health and human
resources pursuant to section one, article two-a, chapter
twenty-seven of this code, and which is supported in part by
state, county or municipal funds; and a combined city-county
health department created pursuant to article two, chapter sixteen of this code. Any matters of doubt as to who is an
"employer" within the meaning of this article shall be decided by
the director. The term "employer" shall not include within its
meaning the national guard.
(6)(5) "Finance board" means the public employees insurance
agency finance board created by this article.
(7)(6) "Retired employee" shall mean an employee of the
state who retired after the twenty-ninth day of April, one
thousand nine hundred seventy-one, and an employee of the
university of West Virginia board of trustees or the board of
directors of the state college system or a county board of
education who retires on or after the twenty-first day of April,
one thousand nine hundred seventy-two, and all additional
eligible employees who retire on or after the effective date of
this article and meet the minimum eligibility requirements for
their respective state retirement system: Provided, That for the
purposes of this article such employees who are not covered by a
state retirement system shall, in the case of education
employees, meet the minimum eligibility requirements of the state
teachers retirement system, and in all other cases, meet the
minimum eligibility requirements of the public employees
retirement system.
§5-16-3. Public employees insurance agency continued;
appointment, qualification, compensation and duties of
director of agency; employees; civil service coverage;
director
vested after specified date with powers of public employees insurance board; expiration of agency.
(a) The public employees insurance agency, heretofore
created, is continued, and shall consist of the director, the
finance board, the advisory board and such employees as may be
authorized by law. The director shall be appointed by the
governor, with the advice and consent of the Senate. He or she
shall serve at the will and pleasure of the governor, unless
earlier removed from office for cause as provided by law. The
director shall have at least three years experience in health
insurance administration prior to appointment as director. The
director shall receive an annual salary established by the
governor not to exceed fifty-five thousand dollars and actual
expenses incurred in the performance of official business. The
director shall employ such administrative, technical and clerical
employees as shall be required for the proper administration of
the insurance programs herein provided. The director shall
perform such duties as are required of him or her under the
provisions of this article and shall be the chief administrative
officer of the public employees insurance agency.
(b) All positions in the agency, except for the director and
his or her personal secretary, shall be included in the
classified service of the civil service system pursuant to
article six, chapter twenty-nine of this code. Any person
required to be included in the classified service by the
provisions of this subsection who was employed in any of the
positions included herein on or after the effective date of this
article shall not be required to take and pass qualifying or competitive examinations upon or as a condition to being added to
the classified service: Provided, That no person required to be
included in the classified service by the provisions of this
subsection who was employed in any of the positions included
herein as of the effective date of this section shall be
thereafter severed, removed or terminated in his or her
employment prior to his or her entry into the classified service
except for cause as if such person had been in the classified
service when severed, removed or terminated.
(c) The director shall be responsible for the administration
and management of the public employees insurance agency as
provided for in this article and in connection therewith shall
have the power and authority to make all rules and regulations
necessary to effectuate the provisions of this article. Nothing
in section four or five of this article shall limit the
director's ability to manage on a day-to-day basis the group
insurance plans required or authorized by this article,
including, but not limited to, administrative contracting,
studies, analyses and audits, eligibility determinations,
utilization management provisions and incentives, provider
negotiations, provider contracting and payment, designation of
covered and noncovered services, offering of additional coverage
options or cost containment incentives, pursuit of coordination
of benefits and subrogation, or any other actions which would
serve to implement the plan or plans designed by the finance
board.
(d) The public employees insurance agency shall terminate in the manner provided in article ten, chapter four of this code, on
the first day of July, two thousand one, unless extended by
legislation enacted before the termination date: Provided, That
the public employees insurance agency advisory board, created in
previous enactment of section six of this article, shall
terminate in the manner provided in article ten, chapter four of
this code on the first day of July, one thousand nine hundred
ninety-six.
§5-16-8. Conditions of insurance program.
The insurance plans herein provided for shall be designed by
the public employees insurance agency:
(1) To provide a reasonable relationship between the
hospital, surgical, medical, and prescription drug benefits to be
included and the expected reasonable and customary hospital,
surgical, medical and prescription drug expenses as established
by the director to be incurred by the affected employee, his or
her spouse and his or her dependents. The establishment of
reasonable and customary expenses by the public employees
insurance agency pursuant to the preceding sentence is not
subject to the state administrative procedures act in chapter
twenty-nine-a of this code.
(2) To include reasonable controls which may include
deductible and coinsurance provisions applicable to some or all
of the benefits, and shall include other provisions, including,
but not limited to, copayments, preadmission certification, case
management programs, and preferred provider arrangements.
(3) To prevent unnecessary utilization of the various hospital, surgical, medical and prescription drug services
available.
(4) To provide reasonable assurance of stability in future
years for the plans.
(5) To provide major medical insurance for said employees.
(6) To provide certain group life and accidental death
insurance for the employees covered under this article.
(7) To include provisions for the coordination of benefits
payable by the terms of such plans with the benefits to which
such employee, or his or her spouse or his or her dependents may
be entitled by the provisions of any other group hospital,
surgical, medical, major medical, or prescription drug insurance
or any combination thereof.
(8) To provide a cash incentive plan for employees, spouses,
and dependents by the thirty-first day of December, one thousand
nine hundred eighty-eight, to increase utilization of, and to
encourage the use of, lower cost alternative health care
facilities, health care providers and generic drugs. Such plan
shall be reviewed annually by the director and the advisory
board.
(9) To provide "wellness" programs and activities which will
include, but not be limited to, benefit plan incentives to
discourage tobacco, alcohol and chemical abuse and an educational
program to encourage proper diet and exercise. In establishing
"wellness" programs, the division of vocational rehabilitation
shall cooperate with the public employees insurance agency in
establishing statewide wellness programs and with such division of vocational rehabilitation to contact county boards of
education for the use of facilities, equipment or any service
related to such purpose, at the request of the director, under
the authority hereby granted to contract therefor. Boards of
education shall be limited to charging only the cost of
janitorial service and increased utilities for the use of the
gymnasium and related equipment. The cost of the exercise
program shall be paid by county boards of education, the public
employees insurance agency, or participating employees, their
spouses or dependents. All exercise programs shall be made
available to all employees, their spouses or dependents and shall
not be limited to employees of county boards of education.
(10) To provide a program, to be administered by the
director, for a patient audit plan with reimbursement up to a
maximum of one thousand dollars annually, to employees for
discovery of health care provider or hospital overcharges when
the affected employee brings such overcharge to the attention of
the plan. The hospital or health care provider shall certify to
the director that it has provided, prior to or simultaneously
with the submission of the statement of charges for payments, an
itemized statement of the charges to the employee participant for
which payment is requested of the plan.
(11) To require that all employers give written notice to
each covered employee prior to institution of any changes in
benefits to employees, and to include appropriate penalty for any
employer not providing the required information to any employee.
NOTE: The purpose of this bill is terminate the public
employees advisory board effective July 1, 1996.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
This bill is recommended for passage during the 1996 regular
Legislative session by the Joint Committee on Government
Operations.