SENATE BILL No. 87

 

 

January 25, 2007, Introduced by Senators BASHAM, PRUSI, WHITMER, GLEASON, JACOBS, BRATER, SCOTT, HUNTER and OLSHOVE and referred to the Committee on Commerce and Tourism.

 

 

 

     A bill to provide for the collection and administration of a

 

fee payable by certain employers; to provide for the disposition of

 

the proceeds of the fee; to require certain employers to submit

 

information; to create a fund in the state treasury; to prescribe

 

the powers and duties of certain state departments and officers;

 

and to provide for civil fines.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 1. This act shall be known and may be cited as the "fair

 

share health care fund act".

 

     Sec. 3. As used in this act:

 

     (a) "Employee" means a person employed full- or part-time in

 

this state by an employer.

 


     (b) "Employer" means an entity organized as a for-profit or

 

not-for-profit entity with 10,000 or more employees in this state.

 

Employer does not include federal, state, or local government or an

 

agency of federal, state, or local government.

 

     (c) "Fund" means the fair share health care fund established

 

in section 5.

 

     (d) "Health insurance costs" means costs an employer incurs to

 

provide health care or health insurance to employees, if the costs

 

are deductible by the employer under federal tax law. Health

 

insurance costs include payments for medical care, prescription

 

drugs, medical savings accounts, and other payments that are for

 

medical care as defined in section 213(d) of the internal revenue

 

code of 1986, 26 USC 213.

 

     (e) "Wages" means the amount reportable by the employer as

 

taxable and nontaxable wages paid to employees for federal income

 

tax purposes.

 

     Sec. 5. (1) The fair share health care fund is established in

 

the state treasury.

 

     (2) The proceeds from the fee or any penalty collected under

 

this act shall be deposited with the state treasurer and credited

 

to the fund.

 

     (3) The state treasurer may receive money or other assets from

 

any source for deposit into the fund. The state treasurer shall

 

direct the investment of the fund. The state treasurer shall credit

 

to the fund interest and earnings from fund investments.

 

     (4) Money in the fund at the close of the fiscal year shall

 

remain in the fund and shall not lapse to the general fund.

 


     (5) Money in the fund shall be expended to assist in funding

 

medical assistance under the state's medicaid program administered

 

under the social welfare act, 1939 PA 280, MCL 400.1 to 400.119b,

 

solely for the benefit of employees of contributors to the fund.

 

     Sec. 7. (1) For the calendar year 2008 and each subsequent

 

year, there is imposed on an employer that is organized as a

 

nonprofit organization an annual fee that is initially established

 

as the amount equal to 6% of the total annual wages that the

 

employer pays to its employees minus the employer's annual health

 

insurance costs, but not less than zero.

 

     (2) For the calendar year 2008 and each subsequent year, there

 

is imposed on an employer that is not organized as a nonprofit

 

organization an annual fee that is initially established as the

 

amount equal to 8% of the total annual wages that the employer pays

 

to its employees minus the employer's annual health insurance

 

costs, but not less than zero.

 

     (3) By January 1 of each year after 2008, the state treasurer,

 

in consultation with the department of community health, shall

 

estimate expected claims against the fund for the next calendar

 

year. The state treasurer shall increase or decrease the amount of

 

the fee assessed against each employer under this section based on

 

the amount of the medicaid claims of employees of that employer, so

 

as to maintain sufficient money in the fund to reimburse medicaid

 

for expected claims. Any amount in excess of that required to

 

maintain the solvency of the fund shall not be refunded or credited

 

to the employer but shall be applied to reduce the employer's

 

assessment for the next fiscal year.

 


     Sec. 9. By April 15 of each year beginning in 2009, an

 

employer shall submit the fee imposed under section 7 along with

 

the following information in a form prescribed by the state

 

treasurer:

 

     (a) The average number of employees the employer employed in

 

this state during the preceding calendar year.

 

     (b) The amount of the employer's health insurance costs for

 

the preceding calendar year.

 

     (c) The percentage of wages that was spent by the employer in

 

the preceding calendar year on health insurance costs. In

 

calculating the percentage under this subdivision, the employer may

 

exempt both of the following:

 

     (i) Wages paid to an employee in excess of the median household

 

income in this state as indicated in the most recent publication of

 

data from the United States census bureau.

 

     (ii) Wages paid to an employee who is enrolled in or eligible

 

for medicare.

 

     Sec. 11. The state treasurer shall prescribe the forms

 

necessary for the administration of the fee under this act and may

 

promulgate rules necessary to implement this act under the

 

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

 

24.328.

 

     Sec. 13. An employer shall not deduct any portion of a payment

 

required under this act from the wages of an employee.

 

     Sec. 15. (1) The director of the department of community

 

health shall develop and make available a form to collect the

 

information from employers concerning employee health insurance

 


coverage that is necessary to complete the report required under

 

section 17.

 

     (2) By April 15 of each year beginning in 2009, an employer

 

shall submit the requested information on the form developed under

 

this section.

 

     Sec. 17. On or before September 15 of each year, the director

 

of the department of community health shall report to the governor

 

and the clerk of each house of the legislature the name of each

 

employer subject to this act and all of the following information

 

for each of those employers:

 

     (a) The employer's definition of full-time employees.

 

     (b) The employer's definition of part-time employees.

 

     (c) The number of full-time employees.

 

     (d) The number of full-time employees eligible to participate

 

in the employer's health benefit program.

 

     (e) The number of full-time employees participating in the

 

employer's health benefit program.

 

     (f) The source of health insurance benefits of the eligible

 

full-time employees who do not participate in the employer's health

 

benefit program.

 

     (g) The number of part-time employees.

 

     (h) The number of part-time employees eligible to participate

 

in the employer's health benefit program.

 

     (i) The number of part-time employees participating in the

 

employer's health benefit program.

 

     (j) The source of health insurance benefits of the eligible

 

part-time employees who do not participate in the employer's health

 


benefit program.

 

     Sec. 19. The principal executive officer or a person

 

performing the function of principal executive officer of the

 

employer shall sign and submit the forms required under this act.

 

The signature shall attest to both of the following:

 

     (a) That the information included in the form was reviewed by

 

the signing officer.

 

     (b) That the information is true and complete to the best of

 

the signing officer's knowledge, information, and belief.

 

     Sec. 21. (1) An employer who fails to report information

 

required under this act is responsible for a civil fine of $250.00

 

for each day that the report is not timely filed.

 

     (2) An employer who fails to pay an amount required under this

 

act is responsible for a civil fine of $250,000.00.