SB 774

Bill Subjects

Abstract

The Public Employees' Medical and Hospital Care Act (PEMHCA) , which is administered by the Board of Administration of the Public Employees' Retirement System, establishes provisions governing postemployment health care benefits for certain retired public employees and their families, upon meeting vesting requirements and subject to various limitations. Existing law provides that a represented state employee first hired on or after January 1, 1989, shall not be vested for the full employer contribution payable for annuitants unless he or she has 20 years of credited state service, as defined, at the time of retirement, as specified. This bill would prohibit a state employer, as defined, for employees first hired on or after January 1, 2015, from providing postemployment health care benefits on behalf of its employees unless it fully funds those benefits, as determined by an actuary. This bill would also prohibit a public employer, for employees first hired on or after January 1, 2015, from entering into a memorandum of understanding or other collective bargaining agreement that provides for defined postemployment health care benefits for which a state employee may opt in unless each employee pays at least 50% of the actuarially required contributions to fund those health care benefits. This bill would additionally provide that, for state employees who become members of the system on and after January 1, 2015, the employer share of contribution for these benefits is 50% after 15 years of credited state service and would increase that percentage by 5% for each year of credit state service up to 100% after 25 years of credited state service.