2006 Ohio Revised Code - [9.90.1] 9.901.Medical plans designed by school employees health care board; fund; advisory committee.

[§ 9.90.1] § 9.901. Medical plans designed by school employees health care board; fund; advisory committee.
 

(A) (1)  Å All health care benefits provided to persons employed by the public schools of this state shall be provided by medical plans designed pursuant to this section by the school employees health care board. The board, in consultation with the superintendent of insurance, shall negotiate with and, in accordance with the competitive selection procedures of Chapter 125. of the Revised Code, contract with one or more insurance companies authorized to do business in this state for the issuance of the plans. Any or all of the medical plans designed by the board may be self-insured. All self-insured plans adopted shall be administered by the board in accordance with this section. As used in this section, a "public school" means a school in a city, local, exempted village, or joint vocational school district, and includes the educational service centers associated with those schools. 

(2) Prior to soliciting proposals from insurance companies for the issuance of medical plans, the board shall determine what geographic regions exist in the state based on the availability of providers, networks, costs, and other factors relating to providing health care benefits. The board shall then determine what medical plans are offered by school districts and existing consortiums in the state. The board shall determine what medical plan offered by a school district or existing consortium in the region offers the lowest premium cost plan. 

(3) Å The board shall develop a request for proposals and solicit bids for medical plans for the school districts in a region similar to the existing plans. The board shall also determine the benefits offered by existing medical plans, the employees' costs, and the cost-sharing arrangements used by public schools participating in a consortium. The board shall determine what strategies are used by the existing medical plans to manage health care costs and shall study the potential benefits of state or regional consortiums of public schools offering multiple health care plans. 

(4) As used in this section, a "medical plan" includes group policies, contracts, and agreements that provide hospital, surgical, or medical expense coverage, including self-insured plans. A "medical plan" does not include an individual plan offered to the employees of a public school, or a plan that provides coverage only for specific disease or accidents, or a hospital indemnity, medicare supplement, or other plan that provides only supplemental benefits, paid for by the employees of a public school. 

(B)  The school employees health care board is hereby created. The school employees health care board shall consist of the following nine members and shall include individuals with experience with public school benefit programs, health care industry providers, and medical plan beneficiaries: 

(1) Three members appointed by the governor; 

(2) Three members appointed by the president of the senate; 

(3) Three members appointed by the speaker of the house of representatives. 

A member of the school employees health care board shall not be employed by, represent, or in any way be affiliated with a private entity that is providing services to the board, an individual school district, employers, or employees in the state of Ohio. 

(C) (1)  Members of the school employees health care board shall serve four-year terms; however, one of each of the initial members appointed under divisions (B)(1) to (3) of this section shall be appointed to a term of one year. The initial appointments under this section shall be made within forty-five days after September 29, 2005. 

Members' terms shall end on the twenty-ninth day of September, but a member shall continue to serve subsequent to the expiration of the member's term until a successor is appointed. Any vacancy occurring during a member's term shall be filled in the same manner as the original appointment, except that the person appointed to fill the vacancy shall be appointed to the remainder of the unexpired term. 

(2) Members shall serve without compensation but shall be reimbursed from the school employees health care fund for actual and necessary expenses incurred in the performance of their official duties as members of the board. 

(3) Members may be removed by their appointing authority for misfeasance, malfeasance, incompetence, dereliction of duty, or other just cause. 

(D) (1)  The governor shall call the first meeting of the school employees health care board. At that meeting, and annually thereafter, the board shall elect a chairperson and may elect members to other positions on the board as the board considers necessary or appropriate. The board shall meet at least four times each calendar year and shall also meet at the call of the chairperson or three or more board members. The chairperson shall provide reasonable advance notice of the time and place of board meetings to all members. 

(2) A majority of the board constitutes a quorum for the transaction of business at a board meeting. A majority vote of the members present is necessary for official action. 

(E)  The school employees health care board shall conduct its business at open meetings; however, the records of the board are not public records for purposes of section 149.43 of the Revised Code. 

(F)  Å The school employees health care fund is hereby created in the state treasury. The public schools shall pay all school employees health care board plan premiums in the manner prescribed by the school employees health care board to the board for deposit into the school employees health care fund. All funds in the school employees health care fund shall be used solely for the provision of health care benefits to public schools employees pursuant to this section and related administrative costs. Premiums received by the board or insurance companies contracted pursuant to division (A) of this section are not subject to any state insurance premium tax. 

(G)  The school employees health care board shall do all of the following: 

(1) Design multiple medical plans, including regional plans, to provide, in the board's judgment, the optimal combination of coverage, cost, choice, and stability of health cost benefits. The board may establish more than one tier of premium rates for any medical plan. The board shall establish regions as necessary for the implementation of the board's medical plans. Plans and premium rates may vary across the regions established by the board. 

(2) Set an aggregate goal for employee and employer portions of premiums for the board's medical plans so as to manage plan participation and encourage the use of value-based plan participation by employees; 

(3) Set employer and employee plan copayments, deductibles, exclusions, limitations, formularies, premium shares, and other responsibilities; 

(4) Include disease management and consumer education programs, to the extent that the board determines is appropriate, in all medical plans designed by the board, which programs shall include, but are not limited to, wellness programs and other measures designed to encourage the wise use of medical plan coverage. These programs are not services or treatments for purposes of section 3901.71 of the Revised Code. 

(5) Create and distribute to the governor, the speaker of the house of representatives, and the president of the senate, an annual report covering the plan background; plan coverage options; plan administration, including procedures for monitoring and managing objectives, scope, and methodology; plan operations; employee and employer contribution rates and the relationship between the rates and the school employees health care fund balance; a means to develop and maintain identity and evaluate alternative employee and employer cost-sharing strategies; an evaluation of the effectiveness of cost-saving services and programs; an evaluation of efforts to control and manage member eligibility and to insure that proper employee and employer contributions are remitted to the trust fund; efforts to prevent and detect fraud; and efforts to manage and monitor board contracts; 

(6) Utilize cost containment measures aligned with patient, plan, and provider management strategies in developing and managing medical plans. 

(H)  The sections in Chapter 3923. of the Revised Code regulating public employee benefit plans are not applicable to the medical plans designed pursuant to this section. 

(I) (1)  Å Public schools are not subject to this section prior to the release of medical plans designed pursuant to this section. 

(2) Prior to the school employees health care board's release of the board's initial medical plans, the board shall contract with an independent consultant to analyze costs related to employee health care benefits provided by existing school district plans in this state. The consultant shall determine the benefits offered by existing medical plans, the employees' costs, and the cost-sharing arrangements used by public schools either participating in a consortium or by other means. The consultant shall determine what strategies are used by the existing medical plans to manage health care costs and shall study the potential benefits of state or regional consortiums of public schools offering multiple health care plans. Based on the findings of the analysis, the consultant shall submit written recommendations to the board for the development and implementation of a successful program for pooling school districts' purchasing power for the acquisition of employee medical plans. The consultant's recommendations shall address, at a minimum, all of the following issues: 

(a) The establishment of regions for the provision of medical plans, based on the availability of providers and plans in the state at the time that the school employees health care board is established; 

(b) The use of regional preferred provider and closed panel plans, health savings accounts, and alternative medical plans, to stabilize both costs and the premiums charged school districts and district employees; 

(c) The development of a system to obtain eligibility data and data compiled pursuant to the "Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA)," 100 Stat. 227, 29 U.S.C. 1161, as amended; 

(d) The use of the competitive bidding process for regional medical plans; 

(e) The development of a timeline planning for the design and use of board medical plans by not later than December 31, 2007; 

(f) The use of information on claims and costs and of information reported by districts pursuant to COBRA in analyzing administrative and premium costs; 

(g) The experience of states that have mandated statewide medical plans for public school employees, including the implementation strategies used by those states; 

(h) Recommended strategies for the use of first-year roll-in premiums in the transition from district medical plans to school employees health care board plans; 

(i) The option of allowing school districts to join an existing regional consortium as an alternative to school employees health care board plans; 

(j) Mandatory and optional coverages to be offered by the board's medical plans; 

(k) Potential risks to the state from the use of medical plans developed pursuant to this section; 

(l) Any legislation needed to ensure the long-term financial solvency and stability of a health care purchasing system; 

(m) The potential impacts of any changes to the existing purchasing structure on all of the following: 

(i) Existing health care pooling and consortiums; 

(ii) School district employees; 

(iii) Individual school districts. 

(n) Issues that could arise when school districts transition from the existing purchasing structure to a new purchasing structure; 

(o) Strategies available to the board in the creation of fund reserves and the need for stop-loss insurance coverage for catastrophic losses; 

(p) Any legislation needed to establish and maintain medical plans designed pursuant to this section. The consultant shall submit all legislative recommendations not later than December 31, 2006, in writing, to the school employees health care board and to the governor, the speaker of the house of representatives, and the president of the senate. 

(3) The public schools health care advisory committee is hereby created under the school employees health care board. The committee shall make recommendations to the school employees health care board related to the board's accomplishment of the duties assigned to the board under this section. The committee shall consist of eighteen members. The governor, the speaker of the house of representatives, and the president of the senate shall each appoint a representative from the Ohio education association, the Ohio school boards association, the Ohio association of school business officials, the Ohio association of health underwriters, an existing health care consortium serving public schools, and a health insuring corporation licensed to do business in Ohio and recommended by the Ohio association of health plans. The initial appointees shall be appointed to a one-year term not later than July 31, 2007, the members' term to begin on that date. Subsequent one-year appointments, to commence on the thirty-first day of July of each year, shall be made in the same manner. A member shall continue to serve subsequent to the expiration of the member's term until the member's successor is appointed. Any vacancy occurring during a member's term shall be filled in the same manner as the original appointment, except that the person appointed to fill the vacancy shall be appointed to the remainder of the unexpired term. The governor shall call the first meeting of each newly appointed committee. At that meeting the board shall elect a chairperson who shall call the time and place of future committee meetings. Committee members are not subject to the conditions for eligibility set by division (B) of this section for members of the school employees health care board. 

(4) The school employees health care board shall submit a written study to the governor and the general assembly not later than January 31, 2007, of a plan to operate in compliance with this section, and on the governance of the school employees health care board. A copy of the board's plan of operation, including audit provisions, shall accompany the report on the board's governance and the report shall include the board's recommendations on any legislation needed to enforce the recommendations of the board on implementing the provisions of this section. 

(5) Å Not later than January 15, 2009, and not later than the same day of each subsequent year, the school employees health care board shall submit a written report to the governor and each member of the general assembly, which report evaluates the performance of school employees health care board medical plans during the previous year. Districts offering employee health care benefits through a plan offered by a consortium of two or more districts, or a consortium of one or more districts and one or more political subdivisions as defined in section 9.833 [9.83.3] of the Revised Code, representing five thousand or more employees as of January 1, 2005, may request permission from the school employees health care board to continue offering consortium plans to the districts' employees at the discretion of the board. If the board grants permission, the permission is valid for only one year but may be renewed annually thereafter upon application to an approval of the board. The board shall grant initial or continued approval upon finding, based on an actuarial evaluation of the existing consortium plan offerings, that benefit design, premium costs, administrative cost, and other factors considered by the board are equivalent to or lower than comparable costs of the board's plan options offered to the local district. Age and gender adjustments, benefit comparison adjustments, and the total cost of the consortium plan, including administration, benefit cost, stop-loss insurance, and all other expenses or information requested by the board shall be presented to the board prior to the board's decision to allow a local district to continue to offer health care benefits under a consortium plan. A district shall not participate in the consortium plan once the district has chosen to offer plans designed by the board to the district's employees and begins premium payments for deposit into the school employees health care fund. 

(6) Any districts providing medical plan coverage for the employees of public schools, or that have provided coverage within two years prior to September 29, 2005, shall provide nonidentifiable aggregate claims data for the coverage to the school employees health care board or the department of administrative services, without charge, within thirty days after receiving a written request from the board or the department. The claims data shall include data relating to employee group benefit sets, demographics, and claims experience. 

(J)  Å The school employees health care board may contract with other state agencies as the board deems necessary for the implementation and operation of this section, based on demonstrated experience and expertise in administration, management, data handling, actuarial studies, quality assurance, or other needed services. The school employees health care board shall contract with the department of administrative services for central services until the board is able to obtain such services from other sources. The board shall reimburse the department of administrative services for the reasonable cost of those services. 

(K)  Å The board's administrative functions shall include, but are not limited to, the following: 

(1) Maintaining reserves in the school employees health care fund, reinsurance, and other measures that in the judgment of the board will result in the long-term stability and solvency of the medical plans designed by the board. The board shall bill school districts, in proportion to a district's premium payments to all premium payments paid into the school employees health care fund during the previous year, in order to maintain necessary reserves, reinsurance, and administrative and operating funds. Each school district contributing to a board medical plan shall share any losses due to the expense of claims paid by the plan. In the event of a loss, the board may bill each district an amount, in proportion to the district's premium payments to all premium payments paid into the school employees health care fund during the previous year, sufficient in total to cover the loss. The state is not liable for any obligations of the school employees health care board or the school employees health care fund, or for expenses of public schools or school districts related to the board's medical plans. 

(2) Providing health care information, wellness programs, and other preventive health care measures to medical plan beneficiaries, to the extent that the board determines to be appropriate; 

(3) Coordinating contracts for services related to the board's medical plans. Contracts shall be approved by the school employees health care board. 

(L)  Å Not less than ninety days before coverage begins for public school employees under medical plans designed by the school employees health care board, a school district's board of education shall provide detailed information about the medical plans to the employees. 

(M)  Å Nothing in this section shall be construed as prohibiting public schools or school districts from consulting with and compensating insurance agents and brokers for professional services. 

(N)  The department of administrative services shall report to the governor, the speaker of the house of representatives, and the president of the senate not later than April 30, 2007, on the feasibility of achieving all of the following: 

(1) Designing multiple medical plans to cover persons employed by public institutions of higher education that achieve an optimal combination of coverage, cost, choice, and stability, which plans include both state and regional preferred provider plans, set employee and employer premiums, and set employee plan copayments, deductibles, exclusions, limitations, formularies, and other responsibilities. For this purpose, "public institutions of higher education" include, without limitation, state universities and colleges, state community college districts, community college districts, university branch districts, technical college districts, and municipal universities. 

(2) Maintaining reserves, reinsurance, and other measures to insure the long-term stability and solvency of the medical plans; 

(3) Providing appropriate health care information, wellness programs, and other preventive health care measures to medical plan beneficiaries; 

(4) Coordinating contracts for services related to the medical plans. 
 

HISTORY: 151 v H 66, § 101.01, eff. 9-29-05/D; 151 v H 530, § 101.01, eff. 6-30-06.
 

The effective date is set by § 812.03 of 151 v H 530. 

The provisions of § 803.03 of 151 v H 530 read as follows: 

SECTION 803.03. The amendment by this act of section 9.901 of the Revised Code neither confirms nor orders the implementation of the provisions of the section that have become law but that are not effective because of Section 611.03 of H.B. 66 of the 126th General Assembly. The provisions of section 9.901 of the Revised Code that have become law but that are not effective because of Section 611.03 of H.B. 66 of the 126th General Assembly continue not in effect, pending enactment of a law confirming and ordering their implementation as contemplated by the latter section. The not-in-effect provisions of section 9.901 of the Revised Code are presented in this act in compliance with the substantive rule of form contained in the second sentence of Ohio Constitution, Article II, Section 15(D) and to negate any implication they are being repealed. 

Å The provisions of § 611.03 of 151 v H 66 read as follows: 

SECTION 611.03. DELAYED IMPLEMENTATION OF CENTRALIZED PUBLIC SCHOOL EMPLOYEES' HEALTH CARE BENEFITS SYSTEM. 

Notwithstanding the amendments made to sections 9.833, 9.90, 3311.19, 3313.12, 3313.202, 3313.33, 4117.03, and 4117.08 of the Revised Code by this act and the enactment of section 9.901 of the Revised Code by this act, the following amendments to a section or enactment of provisions shall not take effect unless and until the General Assembly, by subsequent enactment of law, confirms those amendments and provisions, orders their implementation, and makes such other specifications pertaining to that implementation as is then necessary: 

* * * 

(B) The following provisions of section 9.901 of the Revised Code as enacted: 

(1) Division (A) (1); 

(2) The provision that authorizes the soliciting of bids in division (A) (3); 

(3) Division (F), except for the provision that creates the school employees health care fund in the state treasury; 

(4) Division (I) (1); 

(5) Division (I) (5); 

(6) Division (J), except for the provision that authorizes the School Employees Health Care Board to contract with the Department of Administrative Services for central services and reimburse the Department for such services; 

(7) Division (K); 

(8) Division (L); and 

(9) Division (M). 

 

Effect of Amendments

151 v H 530, effective June 30, 2006, in the first paragraph of (C)(1) and in (I)(6), substituted "September 29, 2005" for "the effective date of this section"; in the second paragraph of (C)(1), substituted "twenty-ninth day of September" for "same day of the same month as the effective date of this section"; in (I)(2)(p), substituted "2006" for "2005"; in (I)(3), substituted "2007" for "2005"; in (I)(4), substituted "January 31, 2007" for "January 15, 2006"; in (N), substituted "not later than April 30, 2007" for "within eighteen months after the effective date of this section"; and made minor stylistic changes.