Florida Senate - 2012                                     SB 366
       By Senator Gaetz
       4-00047-12                                             2012366__
    1                        A bill to be entitled                      
    2         An act relating to group insurance for public
    3         employees; amending s. 112.08, F.S.; requiring that
    4         school districts procure certain types of insurance
    5         for their officers and employees through interlocal
    6         agreements; providing an exception; requiring each
    7         school district to enter into an interlocal agreement
    8         and establish the School District Insurance Consortium
    9         governed by a board of directors; providing for
   10         membership and specifying terms of office for board
   11         members; authorizing the board to employ staff or
   12         contract for staffing services to be provided to the
   13         consortium; requiring the Department of Management
   14         Services to provide technical services to the
   15         consortium; requiring the consortium to advertise for
   16         competitive bids for insurance; authorizing the
   17         awarding of bids on a statewide or regional basis and
   18         the selection of multiple insurance providers;
   19         requiring that school districts engage in collective
   20         bargaining with certified bargaining agents; providing
   21         an effective date.
   23  Be It Enacted by the Legislature of the State of Florida:
   25         Section 1. Subsection (2) of section 112.08, Florida
   26  Statutes, is amended to read:
   27         112.08 Group insurance for public officers, employees, and
   28  certain volunteers; physical examinations.—
   29         (2)(a) Notwithstanding any general law or special act to
   30  the contrary and except as provided under paragraph (c), every
   31  local governmental unit may is authorized to provide and pay out
   32  of its available funds for all or part of the premium for life,
   33  health, accident, hospitalization, legal expense, or annuity
   34  insurance, or all or any kinds of such insurance, for the
   35  officers and employees of the local governmental unit and for
   36  health, accident, hospitalization, and legal expense insurance
   37  for the dependents of such officers and employees upon a group
   38  insurance plan and, to that end, to enter into contracts with
   39  insurance companies or professional administrators to provide
   40  such insurance.
   41         (a) Before entering any contract for insurance, the local
   42  governmental unit shall advertise for competitive bids,; and
   43  such contract shall be let upon the basis of such bids. If a
   44  contracting health insurance provider becomes financially
   45  impaired as determined by the Office of Insurance Regulation of
   46  the Financial Services Commission or otherwise fails or refuses
   47  to provide the contracted-for coverage or coverages, the local
   48  government may purchase insurance, enter into risk management
   49  programs, or contract with third-party administrators and may
   50  make such acquisitions by advertising for competitive bids or by
   51  direct negotiations and contract. The local governmental unit
   52  may undertake simultaneous negotiations with those companies
   53  that which have submitted reasonable and timely bids and are
   54  found by the local governmental unit to be fully qualified and
   55  capable of meeting all servicing requirements. Each local
   56  governmental unit may self-insure any plan for health, accident,
   57  and hospitalization coverage or enter into a risk management
   58  consortium to provide such coverage, subject to approval based
   59  on actuarial soundness by the Office of Insurance Regulation;
   60  and each shall contract with an insurance company or
   61  professional administrator qualified and approved by the office
   62  to administer such a plan.
   63         (b) In order to obtain approval from the Office of
   64  Insurance Regulation of any self-insured plan for health,
   65  accident, and hospitalization coverage, each local governmental
   66  unit or consortium shall submit its plan along with a
   67  certification as to the actuarial soundness of the plan, which
   68  certification is prepared by an actuary who is a member of the
   69  Society of Actuaries or the American Academy of Actuaries. The
   70  Office of Insurance Regulation may shall not approve the plan
   71  unless it determines that the plan is designed to provide
   72  sufficient revenues to pay current and future liabilities, as
   73  determined according to generally accepted actuarial principles.
   74  After implementation of an approved plan, each local
   75  governmental unit or consortium shall annually submit to the
   76  Office of Insurance Regulation a report that which includes a
   77  statement prepared by an actuary who is a member of the Society
   78  of Actuaries or the American Academy of Actuaries as to the
   79  actuarial soundness of the plan. The report is due 90 days after
   80  the close of the fiscal year of the plan. The report must
   81  include shall consist of, but need is not be limited to:
   82         1. The adequacy of contribution rates in meeting the level
   83  of benefits provided and the changes, if any, needed in the
   84  contribution rates to achieve or preserve a level of funding
   85  deemed adequate to enable payment of the benefit amounts
   86  provided under the plan and a valuation of present assets, based
   87  on statement value, and prospective assets and liabilities of
   88  the plan and the extent of any unfunded accrued liabilities.
   89         2. A plan to amortize any unfunded liabilities and a
   90  description of actions taken to reduce unfunded liabilities.
   91         3. A description and explanation of actuarial assumptions.
   92         4. A schedule illustrating the amortization of any unfunded
   93  liabilities.
   94         5. A comparative review illustrating the level of funds
   95  available to the plan from rates, investment income, and other
   96  sources realized over the period covered by the report with the
   97  assumptions used.
   98         6. A statement by the actuary that the report is complete
   99  and accurate and that in the actuary’s opinion the techniques
  100  and assumptions used are reasonable and meet the requirements
  101  and intent of this subsection.
  102         7. Other factors or statements as required by the office in
  103  order to determine the actuarial soundness of the plan.
  105  All assumptions used in the report must shall be based on
  106  recognized actuarial principles acceptable to the Office of
  107  Insurance Regulation. The office shall review the report and
  108  shall notify the administrator of the plan and each entity
  109  participating in the plan, as identified by the administrator,
  110  of any actuarial deficiencies. Each local governmental unit is
  111  responsible for payment of valid claims of its employees which
  112  that are not paid within 60 days after receipt by the plan
  113  administrator or consortium.
  114         (c)Beginning July 1, 2013, or upon the expiration or
  115  renewal date of any existing contract, whichever occurs later,
  116  school districts shall procure health, accident, and
  117  hospitalization insurance through a purchasing interlocal
  118  agreement unless the school board at a duly noticed public
  119  meeting determines that purchasing insurance outside the plan
  120  procured through the interlocal agreement, as provided under
  121  paragraphs (a) and (b), is financially advantageous to the
  122  school district.
  123         1. Each school district shall enter into an interlocal
  124  agreement as provided in s. 163.01 in order to establish the
  125  School District Insurance Consortium through which such
  126  insurance shall be procured for officers and employees of the
  127  school district and their dependents.
  128         2. The consortium shall be governed by a board of directors
  129  comprised of nine members, three of whom shall be elected school
  130  board members appointed by the Florida School Boards
  131  Association, Inc., three of whom shall be elected or appointed
  132  superintendents of schools appointed by the Florida Association
  133  of District School Superintendents, Inc., two of whom shall be
  134  public school teachers or support personnel appointed by the
  135  Florida Education Association, and one of whom shall have
  136  experience in running employee-benefit systems, to be appointed
  137  by the other members of the consortium. Consortium board members
  138  shall be appointed to 2-year terms. The board may employ staff
  139  or contract for staffing services to be provided to the
  140  consortium. The Department of Management Services shall provide
  141  technical services to the consortium as requested by the board.
  142         3. Notwithstanding any other provision of law, the
  143  consortium shall advertise for competitive bids for such
  144  insurance, and the contracts for such insurance shall be let
  145  upon the basis of such bids. The consortium shall advertise for
  146  proposals for a statewide insurance plan as well as plans
  147  providing coverage on a regional basis. In determining
  148  appropriate regions, the consortium shall group school districts
  149  geographically in a manner that includes school districts of
  150  varying sizes for the purpose of ensuring the availability of
  151  coverage for all districts in the region. Contracts may be
  152  awarded on a statewide or regional basis, and more than one
  153  provider may be selected to provide insurance. School districts
  154  shall engage in collective bargaining with the certified
  155  bargaining agent for any unit of employees for which health,
  156  accident, or hospitalization insurance is provided, as required
  157  by part II of chapter 447, with regard to coverage offered, cost
  158  for dependent coverage, deductibles, optional coverage, and
  159  other matters that are subject to collective bargaining as
  160  required by state law.
  161         (d)(c) Every local governmental unit may is authorized to
  162  expend funds for preemployment physical examinations and
  163  postemployment physical examinations.
  164         Section 2. This act shall take effect July 1, 2012.