HB-4572, As Passed House, June 23, 2011

SUBSTITUTE FOR

HOUSE BILL NO. 4572

     A bill to limit a public employer's expenditures for health

insurance benefits; and to provide for exceptions.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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

"public employer health insurance cap act".

     Sec. 3. As used in this act:

     (a) "Health insurance" means employee medical, dental, or

optical benefits.

     (b) "Public employer" means this state; a county, township,

village, city, school district, or other political subdivision of

this state; an authority; a public institution of higher education;

or any other entity jointly created by 2 or more public employers.

     Sec. 5. Except as otherwise provided in this act, a public

House Bill No. 4572 (H-7) as amended June 23, 2011

employer that offers health insurance to its employees through an

insurance carrier or through self-insurance shall pay no more of

the annual premium or illustrative annual premium cost and any

payments for reimbursement of co-pays, deductibles, or payments

into health savings accounts or similar accounts used for health

care, optical, or dental costs, than a total of [$5,500.00] for

single-person coverage, [$11,000.00] for 2-person coverage, or

$15,000.00 for family coverage for the 2012 calendar year. By

October 1 of each year after 2011, the state treasurer shall adjust

the maximum payment permitted under this section for each coverage

category for the succeeding calendar year, based on the change in

the medical care component of the United States consumer price

index for the most recent 12-month period for which data are

available from the United States department of labor, bureau of

labor statistics.

     Sec. 7. (1) If a collective bargaining agreement or other

contract that is inconsistent with section 5 is in effect for a

group of employees of a public employer on the effective date of

this act, the requirements of section 5 do not apply to that group

of employees until the contract expires. The requirements of

section 5 apply to any extension or renewal of the contract.

     (2) A collective bargaining agreement or other contract that

is executed on or after the effective date of this act shall not

include terms that are inconsistent with the requirements of

section 5.

     Sec. 9. Subject to section 7, if a public employer chooses not

to or fails to comply with the requirements of section 5, the

House Bill No. 4572 (H-7) as amended June 23, 2011

public employer shall permit the state treasurer to reduce by 10%

each [economic vitality incentive program payment received under 2011 PA

63] and the department of

education shall reduce by 10% each payment of any funds for which

the public employer qualifies under the state school aid act of

1979, 1979 PA 94, MCL 388.1601 to 388.1772, during the period of

noncompliance.

     Sec. 11. The requirements of section 5 apply to all public

employees to the greatest extent consistent with constitutionally

allocated powers.