January 29, 2009, Introduced by Senators KUIPERS, VAN WOERKOM, KAHN, BROWN, CROPSEY, PAPPAGEORGE, JANSEN, HARDIMAN, RICHARDVILLE and GARCIA and referred to the Committee on Government Operations and Reform.
A bill to amend 1992 PA 234, entitled
"The judges retirement act of 1992,"
by amending sections 715 and 719 (MCL 38.2665 and 38.2669), section
715 as amended by 1999 PA 215 and section 719 as added by 1996 PA
523.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 715. (1) A qualified participant is immediately 100%
vested in his or her contributions made to Tier 2. A qualified
participant shall vest in the employer contributions made on his or
her behalf to Tier 2 according to the following schedule:
(a) Upon completion of 2 years of service, 50%.
(b) Upon completion of 3 years of service, 75%.
(c) Upon completion of 4 years of service, 100%.
(2) A qualified participant who was first eligible to become a
qualified participant on or before December 31, 2008 is vested in
the health insurance coverage provided in section 719 if the
qualified participant meets 1 of the following requirements:
(a) The qualified participant has completed 4 years of service
as a qualified participant and was not a member, deferred vested
member, or former nonvested member of Tier 1.
(b) The qualified participant was a member, deferred vested
member, or former nonvested member of Tier 1 who made an election
to participate in Tier 2 pursuant to section 701 or 701a, and who
has met the service requirements he or she would have been required
to meet in order to vest in health benefits under section 509.
(3) A qualified participant who first became eligible to
become a qualified participant on and after January 1, 2009 is
vested in the health insurance coverage provided in section 719 if
the qualified participant has completed 4 years of service and was
not a member, deferred vested member, or former nonvested member of
Tier 1.
Sec. 719. (1) A former qualified participant may elect health
insurance benefits in the manner prescribed in this section if he
or she meets both of the following requirements:
(a) The former qualified participant is vested in health
benefits under section 715(2) or (3).
(b) The former qualified participant meets or exceeds the
benefit commencement age employed in the actuarial present value
calculation under section 702 and the service requirements that
would have applied to that former participant under Tier 1 for
receiving health insurance coverage under section 509, if that
former participant was a member of Tier 1.
(2) A former qualified participant who is eligible to elect
health insurance coverage under subsection (1) may elect health
insurance coverage in a health benefit plan or plans as authorized
by section 509, or in another plan as provided in subsection (6). A
former qualified participant who is eligible to elect health
insurance coverage under subsection (1) may also elect health
insurance coverage for his or her health benefit dependents, if
any. A surviving health benefit dependent of a deceased former
qualified participant who is eligible to elect health insurance
coverage under subsection (1) may elect health insurance coverage
in the manner prescribed in this section.
(3)
Except as otherwise provided in subsection (6) (7),
an
individual who elects health insurance coverage under this section
shall become a member of a health insurance coverage group
authorized pursuant to section 509.
(4) For a former qualified participant who is eligible to
elect health insurance coverage under subsection (1) and who is
vested in those benefits under section 715(2)(a), and for his or
her health benefit dependents, this state shall pay a portion of
the health insurance premium as calculated under this subsection on
a cash disbursement method. An individual described in this
subsection who elects health insurance coverage under this section
shall pay to the retirement system the remaining portion of the
health insurance coverage premium not paid by this state under this
subsection. The portion of the health insurance coverage premium
paid by this state under this subsection shall be 50% of the
payments for health insurance coverage under section 509 if the
former qualified participant has 4 years of service; 75% of the
payments for health insurance coverage under section 509 if the
former qualified participant has 5 years of service; or 90% of the
payments for health insurance coverage under section 509 if the
former qualified participant has 6 years of service. If the
individual elects the health insurance coverage provided under
section 509, the state shall transfer its portion of the amount
calculated under this subsection to the reserve for health benefits
created by section 214.
(5) For a former qualified participant who is eligible to
elect health insurance coverage under subsection (1) and who is
vested in those benefits under section 715(2)(b), and for his or
her health benefit dependents, this state shall pay a portion of
the health insurance premium as calculated under this subsection on
a cash disbursement method. An individual described in this
subsection who elects health insurance coverage under this section
shall pay to the retirement system the remaining portion of the
health insurance coverage premium not paid by this state under this
subsection. The portion of the health insurance coverage premium
paid by this state under this subsection shall be equal to the
premium amounts paid on behalf of retirants of Tier 1 for health
insurance coverage under section 509. If the individual elects the
health insurance coverage provided under section 509, the state
shall transfer its portion of the amount calculated under this
subsection to the reserve for health benefits created by section
214.
(6) For a former qualified participant who is eligible to
elect health insurance coverage under subsection (1) and who is
vested in those benefits under section 715(3), and for his or her
health benefit dependents, this state shall pay a portion of the
health insurance premium as calculated under this subsection on a
cash disbursement method. An individual described in this
subsection who elects health insurance coverage under this section
shall pay to the retirement system the remaining portion of the
health insurance premium not paid by this state under this
subsection. The portion of health insurance coverage premium paid
by this state under this subsection shall be 30% of the payments
for health insurance coverage under section 509 if the former
qualified participant has completed 4 years of service. If the
former qualified participant has completed more than 4 years, not
to exceed 14 years of service, the portion of the premium paid by
this state shall increase 6% for each completed year of service
through 14 years of service and shall not exceed 90% of the
payments for health insurance and the remaining portion of the
premiums shall be paid by the former qualified participant.
(7) (6)
A former qualified participant or
health benefit
dependent who is eligible to elect health insurance coverage under
this section and who elects health insurance coverage under a
different plan than the plan authorized under section 509 may elect
to have an amount up to the amount of the retirement system's share
of the monthly health insurance premium subsidy provided in this
section paid by the retirement system directly to the other health
insurance plan or to a medical savings account established pursuant
to section 220 of the internal revenue code, to the extent allowed
by law or under the provisions and procedures of Tier 2.
(8) (7)
If the department of management and
budget receives
notification from the United States internal revenue service that
this section or any portion of this section will cause the
retirement system to be disqualified for tax purposes under the
internal revenue code, then the portion that will cause the
disqualification does not apply.