TCA § 8-27-205 — Health benefit for retired state employees — Schedule of premiums — Disabled retirees — Dependents of retirees — Applicability — Implementation of defined contribution plan or related investment vehicle

The state insurance committee may establish a health benefit, as the state insurance committee deems necessary and reasonable, for state employees, as defined in § 8-27-204(a)(1), who are retired. The health benefit may be made available to retired state employees who are drawing retirement benefits through the consolidated retirement system and to retired state employees of the University of Tennessee and the state university and community college system who are drawing retirement benefits through the consolidated retirement system or any other retirement plan as a result of their employment with the University of Tennessee or the state university and community college system. The state insurance committee shall establish a schedule of premiums and is authorized to establish a schedule of defined contributions for retirees eligible for the health benefits established under this part. The schedule shall be graduated to reflect the retiree's length of service. Retirees with thirty (30) or more years of service shall receive eighty percent (80%) of the scheduled premium or defined contribution. Retirees with twenty (20) years of service, but less than thirty (30) years of service, shall receive seventy percent (70%) of the scheduled premium or defined contribution. Retirees having less than twenty (20) years of service shall receive sixty percent (60%) of the scheduled premium or defined contribution. “Years of service,” as used in this subsection (b), means: Only those years of service rendered by the retiree as a state employee, as defined in § 8-27-204(a)(1), or as a teacher as defined in § 8-34-101, and upon which the retiree's monthly retirement allowance is based; or Those years of service rendered by a retiree prior to July 1, 2002, as an employee of any board, commission, or agency created by the supreme court of Tennessee, regardless of whether the retiree established that service in the consolidated retirement system pursuant to § 8-35-115. Any retired state employee who is participating in the insurance plan authorized by this section and who is in receipt of a disability retirement allowance pursuant to chapter 36, part 5 of this title, shall not be required to discontinue coverage in the basic health plan authorized by § 8-27-202(a)(1) upon eligibility for Part A of Medicare and may continue in the plan as a retired state employee to the point at which Medicare eligibility would have been attained had the disability not occurred; provided, that the retired state employee remains eligible for the disability retirement allowance and that Part B of Medicare is retained. The insurance premium shall be the same as that charged to nondisability retirees who are not yet eligible for Medicare. Any retired state employee who is granted a service retirement under chapter 36 of this title shall also qualify for a continuation of insurance coverage if the retired state employee meets the conditions set forth in this subsection (c) and the eligibility criteria established by the state insurance committee. The state insurance committee shall extend eligibility to the dependents of retired state employees who are eligible for the retiree coverage authorized in this section. The state insurance committee may determine which dependents are eligible, and what documentation is required to establish eligibility, subject to the requirements of state and federal law. Eligibility standards for dependents will be approved at public meetings of the state insurance committee and published in the plan documents. The state may deny coverage to the spouses of retired state employees who are eligible for similar group health insurance through their employers. Any denial of coverage made pursuant to this subsection (d) and based on a retiree's spouse's eligibility for similar group health insurance through the spouse's employer shall only apply to the spouse of a retiree whose employment commenced on or after July 1, 2015. The retiree coverage authorized under this section shall not be available to any retiree whose employment with the state commenced on or after July 1, 2015. Any retiree whose first employment with the state commenced before July 1, 2015, and who returns to state service after that date shall not be prohibited from retiree coverage under this section; provided, that the retiree did not accept a lump sum payment from the Tennessee consolidated retirement system before July 1, 2015. Any retiree whose first employment with a participating local education agency, as defined in § 8-27-301, commenced before July 1, 2015, and who initiates state service after that date shall not be prohibited from retiree coverage under this section; provided, that the retiree did not accept a lump sum payment from the Tennessee consolidated retirement system before July 1, 2015. The commissioner of finance and administration, the chair of the finance, ways and means committee of the senate, the chair of the finance, ways and means committee of the house of representatives, and the chair of the consolidated retirement board shall serve as trustees of any defined contribution plan or related investment vehicle established as a health benefit by the state insurance committee under this section. The trustees shall have the authority to implement any such defined contribution plan or related investment vehicle. Notwithstanding § 8-27-103(a), such authority shall include, but not be limited to, administering any contract related to such defined contribution plan or related investment vehicle, procuring services necessary or desirable for efficient administration of the investment vehicles used for the health benefit and overseeing the investment policy for any investment vehicles used. The trustees shall delegate the duty to conduct the day-to-day responsibilities for managing the investment vehicles to the state treasurer. The costs associated with administering any such defined contribution plan or related investment vehicle shall be assessed to the funds generated by any such defined contribution plan or related investment vehicle and, if necessary, to the employee benefits trust. This subsection (f) shall be effective September 1, 2015.