Bill Text: OR HB2279 | 2013 | Regular Session | Engrossed

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to participation of employees of local governments in certain benefit plans.

Spectrum: Bipartisan Bill

Status: (Passed) 2013-08-14 - Chapter 731, (2013 Laws): Effective date January 1, 2014. [HB2279 Detail]

Download: Oregon-2013-HB2279-Engrossed.html

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     77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 1264

                           A-Engrossed

                         House Bill 2279
                  Ordered by the House April 17
            Including House Amendments dated April 17

Sponsored by Representative GREENLICK; Representative THOMPSON
  (Presession filed.)

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.

  Allows employees of local governments to participate in benefit
plans provided by Public Employees' Benefit Board and Oregon
Educators Benefit Board. Defines 'local government.'  { +
Modifies membership of boards if governing body of local
government elects to participate in benefit plan offered by
board.  Specifies that decision to participate in benefit plan is
not subject to collective bargaining.  Allows governing body to
withdraw from participation in benefit plan offered by board to
participate in certain plans offered by Oregon Health Authority.
Requires Director of Oregon Health Authority to appoint executive
director for boards. + }

                        A BILL FOR AN ACT
Relating to participation of employees of local governments in
  certain benefit plans; creating new provisions; and amending
  ORS 243.061, 243.105, 243.125, 243.135, 243.140, 243.145,
  243.160, 243.170, 243.200, 243.215, 243.221, 243.275, 243.860,
  243.862, 243.864, 243.866, 243.868, 243.874, 243.878 and
  243.882.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 243.061 is amended to read:
  243.061. (1) There is created in the Oregon Health Authority
the Public Employees' Benefit Board consisting of  { + at
least + } eight voting members and two members of the Legislative
Assembly as nonvoting advisory members. Two of the voting members
are ex officio members and six are appointed by the Governor. The
voting members shall be:
  (a) Four members representing the state as an employer and
management employees, who shall be as follows:
  (A) The Director of the Oregon Health Authority or a designee
of the director;
  (B) The Administrator of the Office for Oregon Health Policy
and Research or a designee of the administrator; and
  (C) Two management employees appointed by the Governor from
areas of state government other than the Oregon Health Authority
or the Office for Oregon Health Policy and Research; and

  (b) Four members appointed by the Governor and representing
nonmanagement representable employees, who shall be as follows:
  (A) Two persons from the largest employee representative unit;
  (B) One person from the second largest employee representative
unit; and
  (C) One person from representable employees not represented by
employee representative units described in subparagraphs (A) and
(B) of this paragraph.
  (2) One member of the Senate shall be appointed by the
President of the Senate and one member of the House of
Representatives shall be appointed by the Speaker of the House to
serve as nonvoting advisory members.
   { +  (3)(a) If the governing body of a local government elects
to participate in a benefit plan offered by the board, in
addition to the members appointed under subsections (1) and (2)
of this section, the Governor shall appoint two voting members,
one of whom represents local government management and one of
whom represents local government nonmanagement employees.
  (b) After the appointment of members under paragraph (a) of
this subsection, if the number of eligible employees of a local
government or local governments enrolled in a benefit plan or
plans offered by the board exceeds 25,000, the Governor shall
appoint two additional voting members, one of whom represents
local government management and one of whom represents local
government nonmanagement employees.
  (c) After the appointment of members under paragraphs (a) and
(b) of this subsection, for every additional 25,000 eligible
employees of a local government or local governments enrolled in
a benefit plan or plans offered by the board, the Governor shall
appoint one additional voting member representing local
government management and one additional voting member
representing local government nonmanagement employees.
  (4) A maximum of three members may be appointed to represent
local government management and a maximum of three members may be
appointed to represent local government nonmanagement
employees. + }
    { - (3) - }   { + (5) + } The term of office of each
appointed voting member is four years, but an appointed voting
member serves at the pleasure of the Governor. Before the
expiration of the term of a voting member appointed by the
Governor, the Governor shall appoint a successor to take office
upon the date of that expiration. A member is eligible for
reappointment. If there is a vacancy for any cause, the Governor
shall make an appointment to become immediately effective for the
unexpired term.
    { - (4) - }   { + (6) + } The appointments by the Governor of
voting members of the board are subject to confirmation by the
Senate in the manner prescribed in ORS 171.562 and 171.565.
    { - (5) - }  { +  (7) + } Members of the board who are not
members of the Legislative Assembly shall receive no compensation
for their services, but shall be paid for their necessary and
actual expenses while on official business in accordance with ORS
292.495. Members of the board who are members of the Legislative
Assembly shall be paid compensation and expense reimbursement as
provided in ORS 171.072, payable from funds appropriated to the
Legislative Assembly.
   { +  (8) As used in this section, 'benefit plan' and 'local
government' have the meanings given those terms in ORS
243.105. + }
  SECTION 2. ORS 243.105 is amended to read:
  243.105. As used in ORS 243.105 to 243.285, unless the context
requires otherwise:
  (1) 'Benefit plan' includes, but is not limited to:
  (a) Contracts for insurance or other benefits, including
medical, dental, vision, life, disability and other health care
recognized by state law, and related services and supplies;
  (b) Comparable benefits for employees who rely on spiritual
means of healing; and
  (c) Self-insurance programs managed by the Public Employees'
Benefit Board.
  (2) 'Board' means the Public Employees' Benefit Board.
  (3) 'Carrier' means an insurance company or health care service
contractor holding a valid certificate of authority from the
Director of the Department of Consumer and Business Services, or
two or more companies or contractors acting together pursuant to
a joint venture, partnership or other joint means of operation,
or a board-approved guarantor of benefit plan coverage and
compensation.
  (4)(a) 'Eligible employee' means an officer or employee of a
state agency  { + or local government + } who elects to
participate in one of the group benefit plans described in ORS
243.135. The term includes { + , but is not limited to,  + }state
officers and employees in the exempt, unclassified and classified
service, and state officers and employees, whether or not
retired, who:
  (A) Are receiving a service retirement allowance, a disability
retirement allowance or a pension under the Public Employees
Retirement System or are receiving a service retirement
allowance, a disability retirement allowance or a pension under
any other retirement or disability benefit plan or system offered
by the State of Oregon for its officers and employees;
  (B) Are eligible to receive a service retirement allowance
under the Public Employees Retirement System and have reached
earliest retirement age under ORS chapter 238;
  (C) Are eligible to receive a pension under ORS 238A.100 to
238A.245, and have reached earliest retirement age as described
in ORS 238A.165; or
  (D) Are eligible to receive a service retirement allowance or
pension under another retirement benefit plan or system offered
by the State of Oregon and have attained earliest retirement age
under the plan or system.
  (b) 'Eligible employee' does not include individuals:
  (A) Engaged as independent contractors;
  (B) Whose periods of employment in emergency work are on an
intermittent or irregular basis;
  (C) Who are employed on less than half-time basis unless the
individuals are employed in positions classified as job-sharing
positions, unless the individuals are defined as eligible under
rules of the board;
  (D) Appointed under ORS 240.309;
  (E) Provided sheltered employment or make-work by the state in
an employment or industries program maintained for the benefit of
such individuals; or
  (F) Provided student health care services in conjunction with
their enrollment as students at a public university listed in ORS
352.002.
  (5) 'Family member' means an eligible employee's spouse and any
unmarried child or stepchild within age limits and other
conditions imposed by the board with regard to unmarried children
or stepchildren.
   { +  (6) 'Local government' means any city, county or special
district in this state. + }
    { - (6) - }   { + (7) + } 'Payroll disbursing officer' means
the officer or official authorized to disburse moneys in payment
of salaries and wages of employees of a state agency { +  or
local government + }.
    { - (7) - }   { + (8) + } 'Premium' means the monthly or
other periodic charge for a benefit plan.
    { - (8) - }   { + (9) + } 'State agency' means every state
officer, board, commission, department or other activity of state
government.
  SECTION 3. ORS 243.125 is amended to read:
  243.125. (1) The Public Employees' Benefit Board shall
prescribe rules for the conduct of its business and for carrying
out ORS 243.256. The board shall study all matters connected with
the providing of adequate benefit plan coverage for eligible
  { - state - }  employees on the best basis possible with
relation both to the welfare of the employees and to the
state { +  and local governments + }. The board shall design
benefits, devise specifications, analyze carrier responses to
advertisements for bids and decide on the award of contracts.
Contracts shall be signed by the chairperson on behalf of the
board.
  (2) In carrying out its duties under subsection (1) of this
section, the goal of the board shall be to provide a high quality
plan of health and other benefits for   { - state - }  employees
at a cost affordable to both the employer and the employees.
  (3) Subject to ORS chapter 183, the board may make rules not
inconsistent with ORS 243.105 to 243.285 and 292.051 to determine
the terms and conditions of eligible employee participation and
coverage.
  (4) The board shall prepare specifications, invite bids and do
acts necessary to award contracts for health benefit plan and
dental benefit plan coverage of eligible employees in accordance
with the criteria set forth in ORS 243.135 (1).
   { +  (5) The Director of the Oregon Health Authority shall
appoint an executive director for the board. The executive
director shall report to the Director of the Oregon Health
Authority. + }
    { - (5) - }   { + (6) + } The board may retain consultants,
brokers or other advisory personnel when necessary and, subject
to the State Personnel Relations Law, shall employ such personnel
as are required to perform the functions of the board.
  SECTION 4. ORS 243.135 is amended to read:
  243.135. (1) Notwithstanding any other benefit plan contracted
for and offered by the Public Employees' Benefit Board, the board
shall contract for a health benefit plan or plans best designed
to meet the needs and provide for the welfare of eligible
employees { + , + }   { - and - }  the state { +  and the local
governments + }. In considering whether to enter into a contract
for a plan, the board shall place emphasis on:
  (a) Employee choice among high quality plans;
  (b) A competitive marketplace;
  (c) Plan performance and information;
  (d) Employer flexibility in plan design and contracting;
  (e) Quality customer service;
  (f) Creativity and innovation;
  (g) Plan benefits as part of total employee compensation; and
  (h) The improvement of employee health.
  (2) The board may approve more than one carrier for each type
of plan contracted for and offered but the number of carriers
shall be held to a number consistent with adequate service to
eligible employees and their family members.
  (3) Where appropriate for a contracted and offered health
benefit plan, the board shall provide options under which an
eligible employee may arrange coverage for family members.
  (4) Payroll deductions for   { - such - }  costs   { - as - }
 { +  that + } are not payable by the state  { + or a local
government + } may be made upon receipt of a signed authorization
from the employee indicating an election to participate in the
plan or plans selected and the deduction of a certain sum from
the employee's pay.
  (5) In developing any health benefit plan, the board may
provide an option of additional coverage for eligible employees
and their family members at an additional cost or premium.
  (6) Transfer of enrollment from one plan to another shall be
open to all eligible employees and their family members under
rules adopted by the board. Because of the special problems that
may arise in individual instances under comprehensive group
practice plan coverage involving acceptable physician-patient
relations between a particular panel of physicians and particular
eligible employees and their family members, the board shall
provide a procedure under which any eligible employee may apply
at any time to substitute a health service benefit plan for
participation in a comprehensive group practice benefit plan.
  (7) The board shall evaluate a benefit plan that serves a
limited geographic region of this state according to the criteria
described in subsection (1) of this section.
  SECTION 5. ORS 243.140 is amended to read:
  243.140. (1) Persons whose homes are certified as a foster home
by the Department of Human Services under ORS 418.630 and as
defined in ORS 418.625 (3) may participate in a health benefit
plan available to   { - state - }  employees pursuant to ORS
243.105 to 243.285 at the expense of the foster parent. For such
purposes, foster parents shall be considered eligible employees.
  (2) A person who maintains a developmental disability child
foster home that is certified by the department under ORS 443.830
and 443.835 may participate in a health benefit plan available to
  { - state - }  employees pursuant to ORS 243.105 to 243.285 at
the expense of the person. For such purposes, the person
maintaining the home shall be considered an eligible employee.
  (3) Persons who participate in the health benefit plan pursuant
to subsections (1) and (2) of this section may also participate
in a dental plan available to   { - state - }  employees pursuant
to ORS 243.105 to 243.285 at the expense of the foster parent or
the person maintaining the developmental disability child foster
home.
  SECTION 6. ORS 243.145 is amended to read:
  243.145. (1) The Public Employees' Benefit Board shall have
authority to employ whatever means are reasonably necessary to
carry out the purposes of ORS 243.105 to 243.285 and 292.051.
  { - Such authority shall include - }  { +  The board's
authority includes, + } but is not limited to { + , the + }
authority to self-insure and to seek clarification, amendment,
modification, suspension or termination of any agreement or
contract that in the board's judgment requires such action.
  (2) Upon providing specific notice in writing to the carrier,
the affected employee organization or organizations, the Oregon
Health Authority and affected  { - , - }  eligible employees, and
after affording opportunity for a public hearing upon the issues
that may be involved, the board may enter an order withdrawing
approval of any benefit plan. Thirty days after entry of the
order, the board shall terminate all withholding authorizations
of eligible employees and terminate all board-approved
participation in the plan.
  (3) The board by order may terminate the participation of any
state agency  { + or local government + } if within three months
the state agency  { + or local government + } fails to perform
any action required by ORS 243.105 to 243.285 and 292.051 or by
board rule.
  SECTION 7. ORS 243.160 is amended to read:
  243.160. A retired state  { + or local government + } officer
or employee is not required to participate in one of the group
benefit plans described in ORS 243.135 in order to obtain dental
benefit plan coverage. The Public Employees' Benefit Board shall
establish by rule standards of eligibility for retired officers
or employees to participate in a dental benefit plan.
  SECTION 8. ORS 243.170 is amended to read:
  243.170. When more than one individual shares a single position
that is classified as a job-sharing position, the state  { +  or
the local government + } shall contribute to obtain coverage for
the individuals a total amount not greater than the amount that
would be contributed to obtain coverage for one individual in the
same position. The individuals shall receive credit for the state
 { +  or local government + } contribution in such proportions as
they and the employer agree upon, and each individual who desires
coverage shall make further contribution in such amounts as may
be appropriate.
  SECTION 9. ORS 243.200 is amended to read:
  243.200. (1)(a) The Public Employees' Benefit Board may allow
self-pay groups to participate in benefit plans available to
eligible   { - state - }  employees, if the group meets a minimum
participation level equal to 75 percent of the persons in the
group.
  (b) Notwithstanding paragraph (a) of this subsection, the board
may allow nurses or nurse educators who are employed less than
half-time by a state agency { + , local government + } or
university and who are not otherwise eligible for a state  { + or
local government + } contribution for benefits to participate in
a self-pay group without any minimum participation level of
persons in the group.
  (2) Nothing in subsection (1) of this section applies to:
  (a) Any person or group of persons similarly situated exempted
by state or federal law from any minimum participation
requirement; or
  (b) Any person or group of persons participating prior to
January 1, 1992, in a benefit plan that was offered by the State
Employes' Benefit Board.
  (3) As used in subsection (1) of this section, 'self-pay group'
means a group of persons other than state  { + or local
government + } employees for whom the state  { + or the local
government + } makes no contributions for benefit plans under ORS
243.105 to 243.285.
  SECTION 10. ORS 243.215 is amended to read:
  243.215. Any eligible employee unable to participate in one or
more of the plans described in ORS 243.135 (1) solely because the
employee is assigned to perform duties outside the state may be
eligible to receive the monthly state  { + or local
government + } contribution, less administrative expenses, as
payment of all or part of the cost of a health benefit plan of
choice, subject to the approval of the Public Employees' Benefit
Board and such rules as the board may adopt.
  SECTION 11. ORS 243.221 is amended to read:
  243.221. (1) In addition to the powers and duties otherwise
provided by law to provide employee benefits, the Public
Employees' Benefit Board may provide, administer and maintain
flexible benefit plans under which eligible employees   { - of
this state - }  may choose among taxable and nontaxable benefits
as provided in the federal Internal Revenue Code.
  (2) In providing flexible benefit plans, the board may offer:
  (a) Health or dental benefits as provided in ORS 243.125 and
243.135.
  (b) Other insurance benefits as provided in ORS 243.275.
  (c) Dependent care assistance as provided in ORS 243.550.
  (d) Expense reimbursement as provided in ORS 243.560.
  (e) Any other benefit that may be excluded from an employee's
gross income under the federal Internal Revenue Code.
  (f) Any part or all of the state  { + or local government + }
contribution for employee benefits in cash to the employee.
  (3) In developing flexible benefit plans under this section,
the board shall design the plan on the best basis possible with
relation to the welfare of employees   { - and to - }  { + , + }
the state { +  and the local governments + }.
  SECTION 12. ORS 243.275 is amended to read:
  243.275. (1) In addition to contracting for health and dental
benefit plans, the Public Employees' Benefit Board may contract
with carriers to provide at the expense of participating eligible
employees and with or without state  { + or local government + }
participation for coverage, including but not limited to,
insurance or other benefit based on life, supplemental medical,
supplemental dental, optical, accidental death or disability
insurance plans.
  (2) The monthly contribution of each eligible employee for
other benefit plan or plans coverage, as described in subsection
(1) of this section, shall be the total cost per month of the
benefit coverage afforded the employee under the plan or plans,
for which the employee exercises an option, including the cost of
enrollment   { - of such eligible employees - }  and
administrative expenses   { - therefor - } .
  (3) For any benefit plan or plans described in subsection (1)
of this section in which the state  { + or a local government + }
participates, the monthly contribution of each eligible employee
for the benefit plan, for which the employee exercises an option
and there is state  { + or local government + } participation,
shall be reduced by an amount equal to the portion
 { - thereof - }  contributed by the state { +  or the local + }
 { + government + }, including the cost of enrollment   { - of
the eligible employee - }  and   { - the - }  administrative
expenses   { - therefor - } .
  (4) The board may withdraw approval of any such additional
benefit plan coverage in the same manner as it withdraws approval
of health benefit plans as described and authorized by ORS
243.145.
  (5) If any state agency  { + or local government + } contracts
for any of the benefits described in subsection (1) of this
section on behalf of any   { - state - }   { + eligible + }
employees, the administrative expenses   { - thereof - }   { + of
the contract + } shall be paid by assessment of the participating
employees.   { - Such - }   { + The + } contracts are subject to
approval of the board before they become operative. The board may
withdraw approval for any such benefit in the same manner as it
withdraws approval under ORS 243.145.
  SECTION 13.  { + Section 14 of this 2013 Act is added to and
made a part of ORS 243.105 to 243.285.
  SECTION 14. (1) The governing body of a local government may
elect to participate in a benefit plan offered by the Public
Employees' Benefit Board.
  (2) The decision of the governing body of a local government to
participate in a benefit plan offered by the board is solely in
the discretion of the governing body of the local government and
is not subject to collective bargaining.
  (3) If the governing body of a local government elects to
participate in a benefit plan offered by the board, the
participating governing body may terminate participation in that
plan to participate in a benefit plan offered through the Oregon
Health Authority that is in conformity with the Patient
Protection and Affordable Care Act (P.L. 111-148).
  SECTION 15. ORS 243.860 is amended to read:
  243.860. As used in ORS 243.860 to 243.886, unless the context
requires otherwise:
  (1) 'Benefit plan' includes but is not limited to:
  (a) Contracts for insurance or other benefits, including
medical, dental, vision, life, disability and other health care
recognized by state law, and related services and supplies;
  (b) Self-insurance programs managed by the Oregon Educators
Benefit Board; and
  (c) Comparable benefits for employees who rely on spiritual
means of healing.
  (2) 'Carrier' means an insurance company or health care service
contractor holding a valid certificate of authority from the
Director of the Department of Consumer and Business Services, or
two or more companies or contractors acting together pursuant to
a joint venture, partnership or other joint means of operation,
or a board-approved provider or guarantor of benefit plan
coverage and compensation.

  (3) 'District' means a common school district, a union high
school district, an education service district, as defined in ORS
334.003, or a community college district, as defined in ORS
341.005.
  (4)(a) 'Eligible employee' includes:
  (A) An officer or employee of a district or a local
government + } who elects to participate in one of the benefit
plans described in ORS 243.864 to 243.874; and
  (B) An officer or employee of a district { +  or a local
government + }, whether or not retired, who:
  (i) Is receiving a service retirement allowance, a disability
retirement allowance or a pension under the Public Employees
Retirement System or is receiving a service retirement allowance,
a disability retirement allowance or a pension under any other
retirement or disability benefit plan or system offered by the
district  { + or local government + } for its officers and
employees;
  (ii) Is eligible to receive a service retirement allowance
under the Public Employees Retirement System and has reached
earliest service retirement age under ORS chapter 238;
  (iii) Is eligible to receive a pension under ORS 238A.100 to
238A.245 and has reached earliest retirement age as described in
ORS 238A.165; or
  (iv) Is eligible to receive a service retirement allowance or
pension under any other retirement benefit plan or system offered
by the district  { + or local government + } and has attained
earliest retirement age under the plan or system.
  (b) Except as provided in paragraph (a)(B) of this subsection,
'eligible employee' does not include an individual:
  (A) Engaged as an independent contractor;
  (B) Whose periods of employment in emergency work are on an
intermittent or irregular basis; or
  (C) Who is employed on less than a half-time basis unless the
individual is employed in a position classified as a job-sharing
position or unless the individual is defined as eligible under
rules of the Oregon Educators Benefit Board or under a collective
bargaining agreement.
  (5) 'Family member' means an eligible employee's spouse or
domestic partner and any unmarried child or stepchild of an
eligible employee within age limits and other conditions imposed
by the Oregon Educators Benefit Board with regard to unmarried
children or stepchildren.
   { +  (6) 'Local government' means any city, county or special
district in this state. + }
    { - (6) - }   { + (7) + } 'Payroll disbursing officer' means
the officer or official authorized to disburse moneys in payment
of salaries and wages of officers and employees of a
district { +  or a local government + }.
    { - (7) - }   { + (8) + } 'Premium' means the monthly or
other periodic charge, including administrative fees of the
Oregon Educators Benefit Board, for a benefit plan.
  SECTION 16. ORS 243.862 is amended to read:
  243.862. (1) There is established in the Oregon Health
Authority an Oregon Educators Benefit Board consisting of  { + at
least + } 10 members appointed by the Governor, including:
  (a) Two members representing district boards;
  (b) Two members representing district management;
  (c) Two members representing nonmanagement district employees
from the largest labor organization representing district
employees;
  (d) One member representing nonmanagement district employees
from the second largest labor organization representing district
employees;
  (e) One member representing nonmanagement district employees
who are not represented by labor organizations described in
paragraphs (c) and (d) of this subsection; and
  (f) Two members with expertise in health policy or risk
management.
   { +  (2)(a) If the governing body of a local government elects
to participate in a benefit plan offered by the board, in
addition to the members appointed under subsection (1) of this
section, the Governor shall appoint two members, one of whom
represents local government management and one of whom represents
local government nonmanagement employees.
  (b) After the appointment of members under paragraph (a) of
this subsection, if the number of eligible employees of a local
government or local governments enrolled in a benefit plan or
plans offered by the board exceeds 25,000, the Governor shall
appoint two additional members, one of whom represents local
government management and one of whom represents local government
nonmanagement employees.
  (c) After the appointment of members under paragraphs (a) and
(b) of this subsection, for every additional 25,000 eligible
employees of a local government or local governments enrolled in
a benefit plan or plans offered by the board, the Governor shall
appoint one additional member representing local government
management and one additional member representing local
government nonmanagement employees.
  (3) A maximum of three members may be appointed to represent
local government management and a maximum of three members may be
appointed to represent local government nonmanagement
employees. + }
    { - (2) - }   { + (4) + } The term of office of each member
is four years, but a member serves at the pleasure of the
Governor. Before the expiration of the term of a member, the
Governor shall appoint a successor to take office upon the date
of that expiration. A member is eligible for reappointment. If
there is a vacancy for any cause, the Governor shall make an
appointment to become immediately effective for the unexpired
term.
    { - (3) - }   { + (5) + } A member of the board is not
entitled to compensation, but may be reimbursed from funds
available to the board for actual and necessary travel and other
expenses incurred by the member in the performance of the
member's official duties in the manner and amount provided in ORS
292.495.
    { - (4) - }   { + (6) + } The board shall select one of its
members as chairperson and another as vice chairperson, for such
terms and with duties and powers necessary for the performance of
the functions of such offices as the board determines.
    { - (5) - }   { + (7) + } A majority of the members of the
board constitutes a quorum for the transaction of business.
    { - (6) - }   { + (8) + } The board shall meet at times and
places specified by the call of the chairperson or of a majority
of the members of the board.
    { - (7) - }   { + (9) + } Appointments of members to the
board by the Governor are subject to confirmation by the Senate
in the manner prescribed in ORS 171.562 and 171.565.
  SECTION 17. ORS 243.864 is amended to read:
  243.864. (1) The Oregon Educators Benefit Board:
  (a) Shall adopt rules for the conduct of its business and for
carrying out ORS 243.879; and
  (b) May adopt rules not inconsistent with ORS 243.860 to
243.886 to determine the terms and conditions of eligible
employee participation in and coverage under benefit plans.
  (2) The board shall study all matters connected with the
provision of adequate benefit plan coverage for eligible
employees on the best basis possible with regard to the welfare
of the employees and affordability for the districts { +  and
local governments + }. The board shall design benefits, prepare
specifications, analyze carrier responses to advertisements for

bids and award contracts. Contracts shall be signed by the
chairperson on behalf of the board.
  (3) In carrying out its duties under subsections (1) and (2) of
this section, the goal of the board is to provide high-quality
health, dental and other benefit plans for eligible employees at
a cost affordable to the districts { +  and local
governments + }, the employees and the taxpayers of Oregon.
  (4) The board shall prepare specifications, invite bids and
take actions necessary to award contracts for health and dental
benefit plan coverage of eligible employees in accordance with
the criteria set forth in ORS 243.866 (1). The Public Contracting
Code does not apply to contracts for benefit plans provided under
ORS 243.860 to 243.886. The board may not exclude from
competition to contract for a benefit plan an Oregon carrier
solely because the carrier does not serve all counties in Oregon.
  (5) The board may retain consultants, brokers or other advisory
personnel when necessary and shall employ such personnel as are
required to perform the functions of the board.
  SECTION 18. ORS 243.866 is amended to read:
  243.866. (1) The Oregon Educators Benefit Board shall contract
for benefit plans best designed to meet the needs and provide for
the welfare of eligible employees { + , + }   { - and - }  { +
 + }the districts  { +  and local governments + }. In considering
whether to enter into a contract for a benefit plan, the board
shall place emphasis on:
  (a) Employee choice among high-quality plans;
  (b) Encouragement of a competitive marketplace;
  (c) Plan performance and information;
  (d) District  { + and local government + } flexibility in plan
design and contracting;
  (e) Quality customer service;
  (f) Creativity and innovation;
  (g) Plan benefits as part of total employee compensation; and
  (h) Improvement of employee health.
  (2) The board may approve more than one carrier for each type
of benefit plan offered, but the board shall limit the number of
carriers to a number consistent with adequate service to eligible
employees and family members.
  (3) When appropriate, the board shall provide options under
which an eligible employee may arrange coverage for family
members under a benefit plan.
  (4) A district  { + or a local government + } shall provide
that payroll deductions for benefit plan costs that are not
payable by the district  { + or local government + } may be made
upon receipt of a signed authorization from the employee
indicating an election to participate in the benefit plan or
plans selected and allowing the deduction of those costs from the
employee's pay.
  (5) In developing any benefit plan, the board may provide an
option of additional coverage for eligible employees and family
members at an additional premium.
  (6) The board shall adopt rules providing that transfer of
enrollment from one benefit plan to another is open to all
eligible employees and family members. Because of the special
problems that may arise involving acceptable physician-patient
relations between a particular panel of physicians and a
particular eligible employee or family member under a
comprehensive group practice benefit plan, the board shall
provide a procedure under which any eligible employee may apply
at any time to substitute another benefit plan for participation
in a comprehensive group practice benefit plan.
  (7) An eligible employee who is retired is not required to
participate in a health benefit plan offered under this section
in order to obtain dental benefit plan coverage. The board shall
establish by rule standards of eligibility for retired employees
to participate in a dental benefit plan.
  (8) The board shall evaluate a benefit plan that serves a
limited geographic region of this state according to the criteria
described in subsection (1) of this section.
  SECTION 19. ORS 243.868 is amended to read:
  243.868. (1) In addition to contracting for health and dental
benefit plans, the Oregon Educators Benefit Board may contract
with carriers to provide other benefit plans including, but not
limited to, insurance or other benefits based on life,
supplemental medical, supplemental dental, supplemental vision,
accidental death or disability insurance plans.
  (2) The premium for each eligible employee for coverage under a
benefit plan other than a health or dental benefit plan described
in subsection (1) of this section shall be the total cost per
month of the coverage afforded the employee under the plan for
which the employee exercises an option, including the cost of
enrollment   { - of the eligible employee - }  and administrative
expenses for the plan.
  (3) The board may withdraw approval of any additional benefit
plan in the same manner as it withdraws approval of a health or
dental benefit plan as described and authorized by ORS 243.878.
  (4) If the board does not contract for a benefit plan described
in subsection (1) of this section, a district  { + or a local
government + } may contract for the benefit plan on behalf of any
district  { + or local government + } employees. The
administrative expenses of the plan shall be paid in accordance
with the
  { - district's - }  negotiated agreement   { - with - }
 { + between  + }the employees { +  and the district or local
government + }. Benefit plans entered into by a district  { + or
local government + } are subject to approval by the board before
they become operative. The board may withdraw approval of any
such benefit plan in the same manner as it withdraws approval of
a benefit plan under ORS 243.878.
  SECTION 20. ORS 243.874 is amended to read:
  243.874. (1) In addition to the powers and duties otherwise
provided by law to provide benefit plans for eligible employees,
the Oregon Educators Benefit Board may provide and administer
flexible benefit plans under which eligible employees may choose
among taxable and nontaxable benefits as provided in the federal
Internal Revenue Code.
  (2) In providing flexible benefit plans, the board may offer:
  (a) Health or dental benefits as described in ORS 243.864 and
243.866.
  (b) Other insurance benefits as described in ORS 243.868.
  (c) Any other benefit that may be excluded from an employee's
gross income under the federal Internal Revenue Code.
  (d) Any part or all of the district  { + or local
government + } contribution for employee benefits in cash to the
employee.
  (3) In developing flexible benefit plans, the board shall
design the plans on the best basis possible with regard to the
welfare of the employees and affordability for the districts { +
and local governments + }.
  (4) The board may pay some or all of the cost of administering
flexible benefit plans from funds authorized to pay general
administrative expenses incurred by the board.
  (5) The board shall adopt rules as the board considers
necessary for the establishment and administration of flexible
benefit plans.
  (6) The board may contract with private organizations for
administration of flexible benefit plans in accordance with rules
adopted under subsection (5) of this section.
  SECTION 21. ORS 243.878 is amended to read:
  243.878. (1) The Oregon Educators Benefit Board may employ
whatever means are reasonably necessary to carry out the purposes
of ORS 243.860 to 243.886. This authority includes, but is not
limited to, authority to self-insure and to seek clarification,
amendment, modification, suspension or termination of any
agreement or contract.
  (2) Upon providing specific notice in writing to the carrier,
the affected labor organization or organizations, the districts,
 { +  the local governments, + } the Oregon Health Authority and
the affected eligible employees, and after affording opportunity
for a public hearing on the issues that may be involved, the
board may enter an order withdrawing approval of a benefit plan.
Thirty days after entry of the order, the board shall terminate
all withholding authorizations of eligible employees and
terminate all board-approved participation in the plan.
  (3) The board by order may terminate the participation of a
district  { + or a local government + } in a benefit plan if,
within three months, the district  { + or local government + }
fails to perform an action required by ORS 243.860 to 243.886 or
by board rule.
  SECTION 22. ORS 243.882 is amended to read:
  243.882. Subject to legislative budgetary authorization for
operation of the Oregon Educators Benefit Board and the board's
administration of benefit plans and other duties under ORS
243.860 to 243.886, an amount not to exceed two percent of the
monthly employer and employee contributions for benefit plans
shall be forwarded by each participating district  { + and local
government + } to the board and deposited by the board in the
State Treasury to the credit of the Oregon Educators Benefit
Account to meet the board's administrative and other costs
authorized by ORS 243.860 to 243.886. The board shall ensure that
the balance in the account does not exceed five percent of the
monthly total of employer and employee contributions for more
than 120 days.
  SECTION 23.  { + Section 24 of this 2013 Act is added to and
made a part of ORS 243.860 to 243.886. + }
  SECTION 24.  { + (1) The governing body of a local government
may elect to participate in a benefit plan offered by the Oregon
Educators Benefit Board.
  (2) The decision of the governing body of a local government to
participate in a benefit plan offered by the board is solely in
the discretion of the governing body of the local government and
is not subject to collective bargaining.
  (3) If the governing body of a local government elects to
participate in a benefit plan offered by the board, the
participating governing body may terminate participation in that
plan to participate in a benefit plan offered through the Oregon
Health Authority that is in conformity with the Patient
Protection and Affordable Care Act (P.L. 111-148). + }
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