| 1 | A bill to be entitled |
| 2 | An act relating to affordable health insurance in rural |
| 3 | counties; amending s. 112.08, F.S.; providing legislative |
| 4 | findings; providing for a pilot self-insurance program; |
| 5 | authorizing a rural health network in Monroe County to |
| 6 | establish a self-insurance plan for certain purposes; |
| 7 | providing program requirements; providing for approval by |
| 8 | the Office of Insurance Regulation of the Financial |
| 9 | Services Commission; requiring an evaluation and report to |
| 10 | the Legislature by January 1, 2006; providing an effective |
| 11 | date. |
| 12 |
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| 13 | Be It Enacted by the Legislature of the State of Florida: |
| 14 |
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| 15 | Section 1. Paragraph (b) of subsection (2) of section |
| 16 | 112.08, Florida Statutes, is amended, and paragraph (d) is added |
| 17 | to said subsection, to read: |
| 18 | 112.08 Group insurance for public officers, employees, and |
| 19 | certain volunteers; physical examinations.-- |
| 20 | (2) |
| 21 | (b) In order to obtain approval from the Office of |
| 22 | Insurance Regulation of any self-insured plan for health, |
| 23 | accident, and hospitalization coverage, each local governmental |
| 24 | unit or consortium shall submit its plan along with a |
| 25 | certification as to the actuarial soundness of the plan, which |
| 26 | certification is prepared by an actuary who is a member of the |
| 27 | Society of Actuaries or the American Academy of Actuaries. The |
| 28 | Office of Insurance Regulation shall not approve the plan unless |
| 29 | it determines that the plan is designed to provide sufficient |
| 30 | revenues to pay current and future liabilities, as determined |
| 31 | according to generally accepted actuarial principles. After |
| 32 | implementation of an approved plan, each local governmental unit |
| 33 | or consortium shall annually submit to the Office of Insurance |
| 34 | Regulation a report which includes a statement prepared by an |
| 35 | actuary who is a member of the Society of Actuaries or the |
| 36 | American Academy of Actuaries as to the actuarial soundness of |
| 37 | the plan. The report is due 90 days after the close of the |
| 38 | fiscal year of the plan. The report shall consist of, but is not |
| 39 | limited to: |
| 40 | 1. The adequacy of contribution rates in meeting the level |
| 41 | of benefits provided and the changes, if any, needed in the |
| 42 | contribution rates to achieve or preserve a level of funding |
| 43 | deemed adequate to enable payment of the benefit amounts |
| 44 | provided under the plan and a valuation of present assets, based |
| 45 | on statement value, and prospective assets and liabilities of |
| 46 | the plan and the extent of any unfunded accrued liabilities. |
| 47 | 2. A plan to amortize any unfunded liabilities and a |
| 48 | description of actions taken to reduce unfunded liabilities. |
| 49 | 3. A description and explanation of actuarial assumptions. |
| 50 | 4. A schedule illustrating the amortization of any |
| 51 | unfunded liabilities. |
| 52 | 5. A comparative review illustrating the level of funds |
| 53 | available to the plan from rates, investment income, and other |
| 54 | sources realized over the period covered by the report with the |
| 55 | assumptions used. |
| 56 | 6. A statement by the actuary that the report is complete |
| 57 | and accurate and that in the actuary's opinion the techniques |
| 58 | and assumptions used are reasonable and meet the requirements |
| 59 | and intent of this subsection. |
| 60 | 7. Other factors or statements as required by the office |
| 61 | Department of Insurance in order to determine the actuarial |
| 62 | soundness of the plan. |
| 63 |
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| 64 | All assumptions used in the report shall be based on recognized |
| 65 | actuarial principles acceptable to the Office of Insurance |
| 66 | Regulation. The office shall review the report and shall notify |
| 67 | the administrator of the plan and each entity participating in |
| 68 | the plan, as identified by the administrator, of any actuarial |
| 69 | deficiencies. Each local governmental unit is responsible for |
| 70 | payment of valid claims of its employees that are not paid |
| 71 | within 60 days after receipt by the plan administrator or |
| 72 | consortium. |
| 73 | (d) Pilot program; Monroe County.-- |
| 74 | 1. The Legislature has determined that insurers and |
| 75 | managed care organizations are unable to provide adequate or |
| 76 | affordable health insurance coverage in rural counties and other |
| 77 | isolated areas of the state. It is therefore necessary to |
| 78 | explore alternatives for making affordable health insurance |
| 79 | coverage available in rural counties and other similar areas of |
| 80 | the state. |
| 81 | 2. An entity in Monroe County, established pursuant to s. |
| 82 | 381.0406, may, through a nonprofit corporation, establish a |
| 83 | self-insurance plan approved by the office in accordance with |
| 84 | paragraph (b) to insure residents of a rural county or similar |
| 85 | area if the residents are unable to obtain adequate or |
| 86 | affordable health insurance coverage. Premiums charged by the |
| 87 | self-insurance plan for participating residents or employers |
| 88 | shall be actuarially sound. In reviewing such a self-insurance |
| 89 | plan, the office shall consult with the Department of Health to |
| 90 | confirm that the program is consistent with the purpose and |
| 91 | scope of chapter 381. |
| 92 | 3. The entity in Monroe County that establishes this |
| 93 | program shall, in addition to the reporting requirements set |
| 94 | forth in paragraph (b), prepare an evaluation of the pilot |
| 95 | program, including recommendations for the future of the |
| 96 | program, and submit the report to the Governor, the President of |
| 97 | the Senate, the Speaker of the House of Representatives, the |
| 98 | Department of Health, and the office no later than January 1, |
| 99 | 2006. |
| 100 | Section 2. This act shall take effect upon becoming a law. |