SB 0158

AN ACT relative to payment of medical benefits for certain retirement system members retiring with combined creditable service or for certain members who have dependent children.

SPONSORS: Sen. Wheeler, Dist 21; Sen. Klemm, Dist 22; Rep. Pepino, Hills 40

This bill allows retirement system members who retire with certain combined service to have the state pay for the cost of medical benefits premiums. The bill also provides for additional medical benefits payments for a divorced or widowed retiree who has dependent children.

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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Medical Benefits; Payment by Retirement System; Group II. Amend RSA 100-A:52, I(a) to read as follows:

(a) Any person retired as a group II member of the New Hampshire retirement system on service or disability retirement[~~, provided that such person shall be~~] who is entitled to retirement on the basis of group II creditable service without including any credit for service as a group I member of the retirement system, or any person retired on or before July 1, 1991[,] as a group I member whose service retirement benefit is based upon the provisions of RSA 100-A:19-c and who has a minimum of 10 years of creditable service as a group II member, or any person retired as a group II member whose benefit is based on the provisions of RSA 100-A:19-c, RSA 100-A:19-d, or RSA 100-A:19-f and who has a minimum of 10 years of creditable service as a group II member.

2 Medical Benefits; Payment by Retirement System; Group I. Amend RSA 100-A:52-a, I(a) to read as follows:

(a) Any person, who has at least 20 years of creditable service as a group I member if age 60 or older, or at least 30 years of creditable service as a group I member if age 55-59, retired on or before July 1, 2004 as a group I teacher member or political subdivision employee member of the New Hampshire retirement system on service or ordinary disability retirement, [~~provided that~~] where such person shall be entitled to retirement on the basis of group I creditable service, or any person retired on or before July 1, 2004, as a group I or group II member whose [~~service~~] retirement benefit is based upon the provisions of RSA 100-A:19-c, RSA 100-A:19-d, or RSA 100-A:19-f, and who has a minimum of 20 years of creditable service as a group I member.

3 New Paragraph; Medical Benefits; Payment by Retirement System; Group II; Certain Dependent Children. Amend RSA 100-A:52 by inserting after paragraph II the following new paragraph:

II-a. In the case of a member who is eligible for coverage under paragraph I and who is either divorced or was predeceased by a spouse, where the retired member has dependent children, the retirement system shall pay the cost for benefits payable for a member and spouse under this section, until each of the member's dependent children reach 18 years of age, or 25 years of age if attending school on a full-time basis.

4 New Paragraph; Medical Benefits; Payment by Retirement System; Group I; Certain Dependent Children. Amend RSA 100-A:52-a by inserting after paragraph II the following new paragraph:

The New Hampshire Retirement System stated this bill will increase state restricted expenditures by $110,000 in FY 2001 and $30,000 in FY 2002 and each year thereafter. There will be no fiscal impact on state, county, and local revenue, or county and local expenditures.

The New Hampshire Retirement System's Special Account will decrease by $6,648,000 in FY 2001.

The System states this bill would provide post-retirement medical insurance subsidies to certain Group II members. Eligible members include members who retire as Group II members under RSA 100-A:19-c, d and f and have a minimum of 10 years of Group II creditable service, and members who retire as Group II members prior to July 1, 2004 under RSA 100-A:19-c, d and f, and have a minimum of 20 years of Group I creditable service. In addition, this bill would provide for the continuation of the two-person medical insurance subsidy until the last child turns 18 or 25 (if in college), if the Group I or II member is divorced, or if the Group I or II member's spouse predeceases the member and there are dependent children.

The System states the cost to terminally fund these benefits is $6,090,000 for policemen and $558,000 for firemen, as follows:

Benefit Policemen Firemen

At least 10 years of Group II service $5,620,000 $490,000

At least 20 years of Group I service 300,000 0

Dependent Children 170,000 68,000

TOTAL TERMINAL FUNDING $6,090,000 $558,000

The Special Account balances for Policemen and Firemen as of June 30, 2000 was $95,100,000 and $73,800,000, respectively.

The System states there is no cost for Group I employee or teacher members for the continuation of the two-person medical subsidy as provided in this bill.

The System further states this bill would require a one-time administrative cost of $80,000 to modify the System's mainframe to include a dependent tracking system, and an annual on-going administrative expense for NHRS staff to monitor dependent children and the insurance subsidy of approximately $30,000.

The Actuary's letter is on file in the bill jacket in the Senate Clerk's Office.