House File 2430 - Introduced HOUSE FILE BY T. TAYLOR, PETTENGILL, WESSEL=KROESCHELL, BERRY, KRESSIG, SHOULTZ, MASCHER, GASKILL, FREVERT, HEDDENS, SMITH, JOCHUM, D. OLSON, LENSING, WINCKLER, MERTZ, FOEGE, COHOON, SWAIM, WENDT, WHITEAD, R. OLSON, DAVITT, BELL, HUNTER, D. TAYLOR, WHITAKER, BUKTA, and MILLER Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act creating the fair share health care fund, providing for 2 assessments and penalties, and making an appropriation. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5312HT 81 5 av/je/5 PAG LIN 1 1 Section 1. NEW SECTION. 84A.11 FAIR SHARE HEALTH CARE 1 2 FUND. 1 3 1. DEFINITIONS. As used in this section, unless the 1 4 context otherwise requires: 1 5 a. "Director" means the director of the department of 1 6 workforce development. 1 7 b. "Employee" means a natural person who is employed in 1 8 this state for wages by an employer. 1 9 c. "Employer" means a person as defined in section 4.1 1 10 that is organized as a for=profit or nonprofit organization 1 11 and that has fifty or more employees. "Employer" does not 1 12 include the federal government, the state, another state, or a 1 13 political subdivision of the state or another state. 1 14 d. "Health care expenditures" means the amount paid by an 1 15 employer to provide health care benefits or reimburse 1 16 employees for their health care costs, including but not 1 17 limited to payments for medical care, prescription drugs, 1 18 vision care, and medical savings accounts. 1 19 e. "Wages" means compensation owed by an employer for 1 20 labor or services rendered by an employee, whether determined 1 21 on a time, task, piece, commission, or other basis of 1 22 calculation. 1 23 2. EMPLOYER REPORTING REQUIREMENTS. 1 24 a. Beginning on January 1, 2007, and annually thereafter, 1 25 each employer shall provide information to the director, 1 26 pursuant to rules adopted pursuant to chapter 17A, including 1 27 but not limited to all of the following information compiled 1 28 as of January 1 of the previous year: 1 29 (1) The employer's definition of full=time and part=time 1 30 employee of the employer. 1 31 (2) The number of full=time and part=time employees in the 1 32 state of the employer. 1 33 (3) The number of full=time and part=time employees in the 1 34 state eligible to receive health care expenditures from the 1 35 employer and the number of full=time and part=time employees 2 1 in the state receiving health care expenditures from the 2 2 employer. 2 3 (4) The amount spent by the employer for health care 2 4 expenditures for employees in the state. 2 5 (5) The percentage of the employer's payroll for employees 2 6 in the state that was spent for health care expenditures for 2 7 employees in the state. In calculating this amount, an 2 8 employer may exclude wages paid to an employee who was 2 9 enrolled in or eligible for Medicare. 2 10 (6) The source of health care expenditures received by 2 11 full=time and part=time employees in the state who were 2 12 eligible for but did not receive health care expenditures from 2 13 their employer. 2 14 (7) Whether the employer is a nonprofit or a for=profit 2 15 organization. 2 16 b. The information required under paragraph "a" shall be 2 17 contained in a report signed by the principal executive 2 18 officer of the employer or an officer of the employer 2 19 performing a similar function. The report shall include an 2 20 affidavit by the signing officer attesting, under penalty of 2 21 perjury, that the information contained in the report was 2 22 reviewed by the signing officer, is based on the signing 2 23 officer's knowledge, and does not contain any untrue statement 2 24 of material fact or omit a material fact necessary to make the 2 25 report. 2 26 3. DIRECTOR'S ANNUAL REPORT. The director shall submit an 2 27 annual report not later than March 15 to the governor, members 2 28 of the general assembly, and the legislative services agency 2 29 that contains a summarization of information received by the 2 30 director from employers pursuant to subsection 2 and that 2 31 includes all of the following information compiled as of 2 32 January 1 of the previous year: 2 33 a. The name of each nonprofit and for=profit employer in 2 34 the state. 2 35 b. Each employer's definition of full=time and part=time 3 1 employee of the employer. 3 2 c. The number of full=time and part=time employees in the 3 3 state of each employer. 3 4 d. The number of full=time and part=time employees in the 3 5 state eligible to receive health care expenditures from each 3 6 employer. 3 7 e. The number of full=time and part=time employees in the 3 8 state receiving health care expenditures from each employer. 3 9 f. The source of health care expenditures received by 3 10 full=time and part=time employees in the state who were 3 11 eligible for but did not receive health care expenditures from 3 12 their employer. 3 13 g. The percentage of total wages that each nonprofit and 3 14 for=profit employer spent on health care expenditures for 3 15 employees in the state, excluding wages paid to employees 3 16 enrolled in or eligible for Medicare. 3 17 h. The average percentage of total wages that all for= 3 18 profit employers spent on health care expenditures for 3 19 employees in the state, excluding wages paid to employees 3 20 enrolled in or eligible for Medicare. 3 21 i. The average percentage of total wages that all 3 22 nonprofit employers spent on health care expenditures for 3 23 employees in the state, excluding wages paid to employees 3 24 enrolled in or eligible for Medicare. 3 25 4. FAIR SHARE HEALTH CARE FUND == ASSESSMENT == MEDICAL 3 26 ASSISTANCE PROGRAM. 3 27 a. An employer that is organized as a nonprofit 3 28 organization with ten thousand or more employees in the state 3 29 and that spent less than an amount equal to six percent of the 3 30 total amount of wages paid to employees in the state as of 3 31 January 1 of the previous year, excluding wages paid to 3 32 employees who were enrolled in or eligible for Medicare, on 3 33 health care expenditures for those employees, is assessed and 3 34 shall pay to the director an amount equal to the difference 3 35 between the amount the employer spent for such health care 4 1 expenditures and six percent of total wages paid as set forth 4 2 in this paragraph. 4 3 b. An employer that is organized as a for=profit 4 4 organization with ten thousand or more employees in the state 4 5 and that spent less than an amount equal to eight percent of 4 6 the total amount of wages paid to employees in the state as of 4 7 January 1 of the previous year, excluding wages paid to 4 8 employees who were enrolled in or eligible for Medicare, on 4 9 health care expenditures for those employees, is assessed and 4 10 shall pay to the director an amount equal to the difference 4 11 between the amount the employer spent for such health care 4 12 expenditures and eight percent of total wages paid as set 4 13 forth in this paragraph. 4 14 c. The director shall determine the means and method of 4 15 collecting the assessments. All moneys collected by the 4 16 director pursuant to this subsection shall be forwarded to the 4 17 treasurer of state, who shall deposit the moneys in a fair 4 18 share health care fund created in the state treasury under the 4 19 control of the director of human services. The moneys 4 20 deposited in the fund are appropriated and shall be used only 4 21 for the purposes of the medical assistance program as defined 4 22 in chapter 249A. 4 23 Notwithstanding section 12C.7, subsection 2, interest or 4 24 earnings on moneys that are deposited in the fund shall be 4 25 credited to the fund, and notwithstanding section 8.33, moneys 4 26 credited to the fund shall not revert to the general fund of 4 27 the state at the close of a fiscal year. 4 28 5. PENALTIES. 4 29 a. An employer that fails to timely file an annual report 4 30 as required under subsection 2 is in violation of this section 4 31 and shall pay an administrative penalty of two hundred fifty 4 32 dollars for each day that the report is not timely filed. 4 33 b. An employer that fails to pay the assessment as 4 34 required under subsection 4 is in violation of this section 4 35 and shall pay an administrative penalty of two hundred fifty 5 1 thousand dollars. 5 2 c. Penalties assessed under this subsection shall be paid 5 3 to the director, who shall forward the moneys to the treasurer 5 4 of state for deposit in the fair share health care fund. 5 5 EXPLANATION 5 6 This bill creates the fair share health care fund, provides 5 7 for assessments of certain employers, makes an appropriation, 5 8 and provides for penalties. 5 9 The bill applies to employers that are organized as 5 10 nonprofit or for=profit organizations with 50 or more 5 11 employees in the state. The bill does not apply to the 5 12 federal government, the state, another state, or a political 5 13 subdivision of the state or another state. 5 14 Beginning on January 1, 2007, such employers are required 5 15 to annually report information as of January 1 of the previous 5 16 year to the director of the department of workforce 5 17 development concerning the employer's definition of full=time 5 18 and part=time employees; how many full=time and part=time 5 19 employees were employed by the employer; the number of full= 5 20 time and part=time employees eligible to receive health care 5 21 expenditures from the employer and how many did receive such 5 22 expenditures; the amount spent by the employer for health care 5 23 expenditures for employees in the state; the percentage of the 5 24 employer's payroll for employees in the state that was spent 5 25 for health care expenditures for those employees, excluding 5 26 wages paid to an employee who was enrolled in or eligible for 5 27 Medicare; and whether the employer is a nonprofit or for= 5 28 profit organization. 5 29 The required information must be contained in a report 5 30 signed by the principal executive officer of the employer or 5 31 an officer with a similar function and include an affidavit by 5 32 the signing officer attesting that the officer reviewed the 5 33 information, has knowledge of the information, and that the 5 34 information does not contain any untrue statement or omission 5 35 of a material fact. 6 1 The director of the department of workforce development is 6 2 required to submit an annual report to the governor, members 6 3 of the general assembly, and the legislative services agency, 6 4 not later than March 15, summarizing the information compiled 6 5 as of January 1 of the previous year, received by the director 6 6 from employers pursuant to the employer reporting 6 7 requirements. In addition, the director is required to state 6 8 the average percentage of total wages that all nonprofit 6 9 employers and all for=profit employers spent on health care 6 10 expenditures for employees in the state for the previous year, 6 11 excluding wages paid to employees enrolled in or eligible for 6 12 Medicare. 6 13 The bill creates the fair share health care fund under the 6 14 control of the director of human services. The bill requires 6 15 a nonprofit employer with 10,000 or more employees in the 6 16 state that spent less than an amount equal to 6 percent or a 6 17 for=profit employer with 10,000 or more employees in the state 6 18 that spent less than an amount equal to 8 percent of the 6 19 amount of total wages paid to its employees in the state on 6 20 health care expenditures for those employees as of January 1 6 21 of the previous year, to pay to the director an amount equal 6 22 to the difference between the amount the employer spent for 6 23 such health care expenditures and the amount equal to 6 and 8 6 24 percent, respectively, of the amount of total wages paid to 6 25 its employees in the state, excluding wages paid to employees 6 26 enrolled in or eligible for Medicare. 6 27 The director of the department of workforce development is 6 28 required to adopt rules to establish the means and method of 6 29 collecting the assessments and to forward all moneys collected 6 30 to the treasurer of state for deposit in the fair share health 6 31 care fund. The bill provides that the moneys in the fund are 6 32 appropriated and shall be used only for the purposes of the 6 33 medical assistance program as defined in Code chapter 249A. 6 34 Earnings and interest on moneys in the fund remain in the fund 6 35 and unused moneys in the fund do not revert to the general 7 1 fund of the state at the end of the fiscal year. 7 2 The bill provides that an employer that fails to timely 7 3 file an annual report shall pay an administrative penalty of 7 4 $250 for each day that the report is not timely filed. An 7 5 employer that fails to pay the required assessment is liable 7 6 for an administrative penalty of $250,000. Penalty payments 7 7 are required to be deposited in the fair share health care 7 8 fund. 7 9 LSB 5312HT 81 7 10 av:rj/je/5