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S.F. No. 247 - Employee Participation in Selection of Public Employees Insurance Program; Local Government Health Insurance Plan Changes
Author: Senator Gary H. Dahms
Prepared By: Thomas S. Bottern, Senate Counsel (651/296-3810)
Date: April 18, 2011

This bill changes procedures to determine whether local government units participate in the Public Employees Insurance Program (PEIP). The bill will require employer approval of the decision to participate, in addition to the existing requirement for the selection of PEIP by exclusive representatives of employees. PEIP is a statewide health, dental, and life insurance pool administered on behalf of local units of government by Minnesota Management and Budget.
This bill also changes existing requirements for local units of government that offer insurance to their employees to strike a requirement that former employees of the local unit of government under age 65 be pooled with active employees.
Section-by-Section Summary
Section 1 [Public Employee Participation.] Currently, each exclusive representative determines whether the employees it represents will participate in PEIP. This section provides that a decision to participate in PEIP will be  made as follows:
(1)   a majority of all insurance-eligible employees approve the decision;
(2)   the exclusive representative and the employer compare PEIP to their current coverage; and
(3)   the employer approves the decision to opt into PEIP.
This section also requires that either all or none of the insurance eligible employees for the local unit of government must participate in the program. In addition, this section reduces automatic renewal in PEIP to a one-year term, unless 30 days’ notice is given before the end of the participation period. This section requires the PEIP program to provide each enrolled entity with the entity’s monthly claims data when requested. 
Section 2 [Insurance Continuation.]  Current law requires local units of government to allow former employees and their dependents to continue participation in the employer’s insurance coverage, at the employee’s expense. This section eliminates the existing requirement to pool former employees under the age of 65 and their dependents together with active employees for the purpose of establishing premiums and coverage. 
Section 3 [Coordination.] specifies that a local unit of government allowing a retired employee to continue health insurance coverage within the plan offered by the local unit of government must provide coverage that is coordinated with Medicare benefits.
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