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Personnel Plan for MnSCU Administrators 1997-1999

APPENDIX B - INSURANCE

Section 1. Manager Group Insurance Program. During the life of this Plan, the Employer shall provide a Group Insurance Program that includes health, dental, life, and disability coverages equivalent to existing coverages, subject to the provisions of this Chapter.

All insurance eligible managers will be provided with a Summary Plan Description describing these coverages. Such Summary Plan Description shall be provided no less than biennially and prior to the beginning of the insurance year. New insurance eligible managers shall receive a Summary Plan Description within thirty (30) days of their date of eligibility.

Section 2. Eligibility for Group Participation. This section describes eligibility to participate in the Group Insurance Program.

1. Job-sharing Managers. Consistent with M.S. 43A.44, subdivision 2, a manager in the State job-sharing program may participate in the Group Insurance Program.
   
   
2. Managers with a Work-related Injury/Disability. A manager who was off the State payroll due to a work-related injury or a work-related disability may continue to participate in the Group Insurance Program as long as such a manager receives workers' compensation payments or while the workers' compensation claim is pending.
   
   
3. Totally Disabled Managers. Consistent with M.S. 62A.148, certain totally disabled managers may continue to participate in the Group Insurance Program.
   
   
4. Retired Managers. A manager who retires from State service, is not eligible for regular (non-disability) Medicare coverage, has five (5) or more years of allowable pension service, and is entitled at the time of retirement to immediately receive an annuity under a State retirement program, may continue to participate in the health and dental coverages offered through the Group Insurance Program.
   
   Consistent with M.S. 43A.27, subdivision 3, a retired manager from State service who receives an annuity under a State retirement program may continue to participate in the health and dental coverages offered through the Group Insurance Program. Retiree coverage must be coordinated with Medicare.

1. Spouse. The spouse of an eligible manager (if not legally separated). For the purpose of health insurance coverage, if that spouse works full-time for an organization employing more than 100 people and elects to receive either credits or cash (1) in place of health insurance or health coverage or (2) in addition to a health plan with a seven hundred and fifty dollar ($750) or greater deductible through his/her employing organization, s/he is not eligible to be a covered dependent for the purposes of this Chapter. If both spouses work for the State or another organization participating in the State's Group Insurance Program, neither spouse may be covered as a dependent by the other, unless one spouse is not eligible for a full Employer Contribution as defined in Section 3A.
   
   
2. Children and Grandchildren. An eligible manager's unmarried dependent children and unmarried dependent grandchildren: (1) through age eighteen (18); or (2) through age twenty-four (24) if the child or grandchild is a full-time student at an accredited educational institution; or (3) a child or grandchild, regardless of age or marital status, who is incapable of self-sustaining employment by reason of mental retardation, mental illness or physical disability and is chiefly dependent on the manager for support. The handicapped dependent shall be eligible for coverage as long as s/he continues to be handicapped and dependent, unless coverage terminates under the contract.

   "Dependent Child" includes a manager's: (1) biological child, (2) child legally adopted by or placed for adoption with the manager, (3) foster child, and (4) step-child. To be considered a dependent child, a foster child must be dependent on the manager for his/her principal support and maintenance and be placed by the court in the custody of the manager. To be considered a dependent child, a step-child must maintain residence with the manager and be dependent upon the manager for his/her principal support and maintenance.

   "Dependent Grandchild" includes a manager's: (1) grandchild placed in the legal custody of the manager, (2) grandchild legally adopted by the manager or placed for adoption with the manager, or (3) grandchild who is the dependent child of the manager's unmarried dependent child. Under (1) and (3) above, the grandchild must be dependent upon the manager for principal support and maintenance and live with the manager.

   If both spouses work for the State or another organization participating in the State's Group Insurance Program, either spouse, but not both, may cover their eligible dependent children or grandchildren. This restriction also applies to two divorced, legally separated, or unmarried managers who share legal responsibility for their eligible dependent children or grandchildren.

1. termination of employment (except for gross misconduct);
2. layoff;
3. reduction of hours to an ineligible status;
4. dependent child becoming ineligible due to change in age, student status, marital status, or financial support (in the case of a foster child or stepchild);
5. death of manager; or
6. divorce.

Section 3. Eligibility for Employer Contribution. This section describes eligibility for an Employer Contribution toward the cost of coverage.

1. Managers who are scheduled to work at least forty (40) hours weekly for a period of nine (9) months or more in any twelve (12) consecutive months.
   
   
2. Managers who are scheduled to work at least sixty (60) hours per pay period for twelve (12) consecutive months, but excluding part-time or seasonal managers serving on less than a seventy-five (75) percent basis.

1. Part-time Managers. Managers who hold part-time, unlimited appointments and who work at least fifty (50) percent of the time but less than seventy-five (75) percent of the time.
   
   
2. Seasonal Managers. Seasonal managers who are scheduled to work at least 1044 hours for a period of nine (9) months or more in any twelve (12) consecutive months.

   The Employer Premium Contribution for medical and dental insurance benefits for seasonal managers in the 1999 Plan Year shall be the same as the benefits negotiated in the major bargaining agreements for the 1997-1999 biennium.

1. Job-sharing Managers. Consistent with M.S. 43A.44, subdivision 2, a manager in the State job-sharing program receives a pro rata Employer Contribution according to the share of the job worked. The pro rata Employer Contribution applies only to health and dental coverages; job-sharing managers receive the full Employer Contribution for basic life coverage.
   
   
2. Managers on Layoff. A classified manager who receives an Employer Contribution, who has three (3) or more years of continuous service, and who has been laid off, remains eligible for an Employer Contribution and all other benefits provided under this Chapter for six (6) months from the date of layoff.
   
   
3. Work-related Injury/Disability. A manager who receives an Employer Contribution and who is off the State payroll due to a work-related injury or a work-related disability remains eligible for an Employer Contribution as long as such a manager receives workers' compensation payments. If such manager ceases to receive workers' compensation payments for the injury or disability and is granted a disability leave under Chapter 6, s/he shall be eligible for an Employer Contribution during that leave.

1. General. A manager who receives a full or partial Employer Contribution maintains that eligibility as long as the manager meets the Employer Contribution eligibility requirements, and appears on a State payroll for at least one full working day during each payroll period. This requirement does not apply to managers who receive an Employer Contribution while on layoff as described in Section 3C2, or while eligible for workers' compensation payments as described in Section 3C3.
   
   
2. Unpaid Leave of Absence. If a manager is on an unpaid leave of absence, then vacation leave, compensatory time, or sick leave cannot be used for the purpose of maintaining eligibility for an Employer Contribution by keeping the manager on a State payroll for one (1) working day per pay period.
   
   
3. School Year Employment. If a manager is employed on the basis of a school year and such employment contemplates absences from the State payroll during the summer months or vacation periods scheduled by the Appointing Authority which occur during the regular school year, the manager shall nonetheless remain eligible for an Employer Contribution, provided that the manager appears on the regular payroll for at least one working day in the payroll period immediately preceding such absences.
   
   
4. A manager who is on an approved FMLA leave or on a salary savings leave as provided elsewhere in this plan maintains their eligibility.
   

Section 4. Amount of Employer Contribution. For managers eligible for an Employer Contribution as described in Section 3, the amount of the Employer Contribution will be determined as follows beginning on December 24, 1997. The Employer Contribution amounts and rules in effect on June 30, 1997 will continue through December 23, 1997.

1. Manager Coverage. For manager health coverage, the Employer contributes an amount equal to the lesser of one hundred (100) percent of the manager-only premium of the Low-Cost Health Plan, or the actual manager-only premium of the health plan chosen by the manager.
   
   
2. Dependent Coverage. For dependent health coverage, the Employer contributes an amount equal to the lesser of ninety (90) percent of the dependent premium of the Low-Cost Health Plan, or the actual dependent premium of the health plan chosen by the manager.
   
   
3. Low-Cost Health Plan. For the purposes of Section 4A, "Low-Cost Health Plan" means the health plan with: (1) the lowest family premium rate; and (2) operating in the county of the manager's permanent work location. "Family premium" is the total of the manager premium and the dependent premium.
   
   The Low-Cost Health Plan for each county for the 1998 insurance year is listed in Appendix I. During the 1998 insurance year, the list may be changed only if the Low-Cost Health Plan no longer operates in a county.
   
   
4. Manager Work Location. The Employer Contribution for each manager is based on the manager's permanent work location on the effective date of each new insurance year. If the health plan a manager is enrolled in is not available at the new permanent work location, then the Employer Contribution changes to the amount in effect at the new permanent work location.

1. Manager Coverage. For manager dental coverage, the Employer contributes an amount equal to the lesser of one hundred (100) percent of the manager premium of the State Dental Plan, or the actual manager premium of the dental plan chosen by the manager.
   
   
2. Dependent Coverage. For dependent dental coverage, the Employer contributes an amount equal to the lesser of fifty (50) percent of the dependent premium of the State Dental Plan, or the actual dependent premium of the dental plan chosen by the manager.

Section 5. Coverage Changes and Effective Dates.

1. If a manager becomes married, the manager may add his/her spouse and any dependent children/grandchildren.
   
   
2. If the manager's spouse loses group health or dental coverage, the manager may add his/her spouse and any dependent children/grandchildren.
   
   
3. When a manager acquires their first dependent child, grandchild, or step-child, the manager may add dependent coverage to cover both the child and the manager's spouse.

1. Dependent Coverage. A manager may cancel dependent health or dependent dental coverage outside of open enrollment only in the case of certain life events that are consistent with the request to cancel coverage. The request to cancel coverage must be made within sixty (60) days of the event. Life events include, but are not limited to:
   

• loss of dependent status of a sole dependent;
• death of a sole dependent;
• divorce;
• change in employment condition of a manager or spouse; and
• a significant change of spousal insurance coverage (cost of coverage is not a significant change).

Dependent health or dependent dental coverage may also be cancelled during the open enrollment period that applies to each type of plan for any reason.

1. Manager-only Coverage. A part-time manager may also cancel manager-only coverage within sixty (60) days of when one of these same life events occurred.

1. Health, Dental, and Basic Life. Except for dependent coverage for newborn children, handicapped dependents as defined in Minnesota Statutes 62A.14 and 62A.141, and children placed for the purposes of adoption, the effective date of initial coverage or a change in coverage is delayed in the event that, on the date coverage would otherwise be effective, a manager or his/her dependent is hospitalized. Initial coverage for a newborn child is not affected by the child's hospitalization. In all other cases, coverage does not begin or change until the beginning of the first payroll period following the manager's or dependent's hospital discharge. However, initial manager-only coverage may begin if the manager's dependent is hospitalized.
   
   The effective date of a change in coverage is not delayed in the event that, on the date the coverage change would be effective, a manager is on an unpaid leave of absence or layoff.
   
   
2. Optional Life and Disability Coverages. In order for coverage to become effective, the manager must be in active payroll status and not using sick leave on the first day of the pay period coinciding with or next following approval by the insurance company. If it is an open enrollment period, coverage may be applied for but will not become effective until the first day of the pay period coinciding with or next following the manager's return to work.

1. Frequency and Duration. There shall be an open enrollment period for health coverage in each year of this Plan, and for dental coverage in the first year of this Plan. Open enrollment periods shall last a minimum of thirty (30) calendar days. Open enrollment changes become effective on December 24, 1997 in the first year of this Plan, and on January 6, 1999 in the second year of this Plan.
   
   
2. Eligibility to Participate. A manager eligible to participate in the State Employee Group Insurance Program, as described in Section 2A and 2B, may participate in open enrollment. In addition, a person in the following categories may, as allowed in Section 5E1 above, make certain changes: (1) a former manager or dependent on continuation coverage, as described in Section 2D, may change plans or add coverage for health and/or dental plans on the same basis as active managers; and (2) an early retiree, prior to becoming eligible for Medicare, may change health and/or dental plans as agreed to for active managers, but may not add dependent coverage.
   
   
3. Materials for Manager Choice. Each year prior to open enrollment, the Appointing Authority will give eligible managers the information necessary to make open enrollment selections. Managers will be provided a statement of their current coverage each year of the plan.

Section 6. Basic Coverages.

1. Coverage Options. Eligible managers must select coverage under one of the health plans offered by the Employer, including health maintenance organization plans, the State Health Plan, or other health plans.
   
   
2. Coverage Under the State Health Plan. From July 1, 1997 through December 23, 1997, coverage under the State Health Plan Point of Service and State Health Plan Select (hereinafter referred to as SHPPOS and SHPS, respectively) will continue at the level in effect on June 30, 1997. Effective December 24, 1997, SHPPOS and SHPS will cover allowable charges for the following eligible services subject to the copayments and coverage limits stated. Services provided through both plans are subject to their managed care procedures and principles, including standards of medical necessity and appropriate practice.

a.

Services received from, or authorized by, a primary care physician within the primary care clinic. State Health Plan Point of Service (SHPPOS) and State Health Plan Select (SHPS). The following health care services under SHPPOS and SHPS shall be received from, or authorized by, a primary care physician within the primary care clinic. The primary care clinic shall be selected from approved clinics in accordance with SHPPOS and SHPS administrative procedures. Higher out-of-pocket costs as described in 6A2b apply to the following services if not received from, or authorized by, a primary care physician within the primary care clinic.

1. Inpatient hospital services. One hundred (100) percent coverage.
2. Outpatient surgery center services. One hundred (100) percent coverage.
3. Home health services. One hundred (100) percent coverage up to a maximum of five thousand dollars ($5,000) eligible expenses per person per year.
4. X-rays and laboratory tests. One hundred (100) percent coverage.
5. Preventive care. One hundred (100) percent coverage.
6. Physicians services. One hundred (100) percent coverage.
7. Durable medical equipment. Eighty (80) percent coverage.

b.

Services not authorized by a primary care physician within the primary care clinic. Coverage under this section 6A2b is only available to individuals who elect SHPPOS coverage, and then only under the terms and conditions outlined in the Certificate of Coverage. For services under 6A2a which are not authorized by a primary care physician within the primary care clinic in the 1998 and 1999 insurance years:

• there is a three hundred fifty dollar ($350) deductible per person with a maximum deductible per family of seven hundred dollars ($700).

After deductible is satisfied, seventy (70) percent coverage up to a maximum annual copayment of

• three thousand dollars ($3,000) per person and six thousand dollars ($6,000) per family.

	These deductibles and copayments are separate from the deductibles and copayments for authorized services under Section 6A2a.
c.	Special service networks (applies to SHPPOS and SHPS). The following services must be received from Special Service network providers in order to be covered.

1. Mental health services - inpatient and outpatient. One hundred (100) percent coverage (up to 365 days for inpatient services). No coverage for services obtained from out-of-network providers under SHPS. Out-of-network services are available under SHPPOS according to the terms of the Certificate of Coverage. Services need not be authorized by a primary care physician within the primary care clinic.
   
   
2. Chemical dependency services - inpatient and outpatient. One hundred (100) percent coverage (up to 365 days for inpatient services). No coverage for services obtained from out-of-network providers under SHPS. Out-of-network services are available under SHPPOS according to the terms of the Certificate of Coverage. Services need not be authorized by a primary care physician within the primary care clinic.
   
   
3. Chiropractic services. One hundred (100) percent coverage. No coverage for services obtained from out-of-network providers. Services need not be authorized by a primary care physician within the primary care clinic. Coverage shall be provided for a minimum of twenty (20) services or twenty-one (21) calendar days, whichever is greater, per incident.
   
   
4. Transplant coverage. The SHPPOS and SHPS shall provide transplant coverage, as specified in their respective Certificates of Coverage. No coverage for services obtained from out-of-network providers.
   
   Referrals for eligible transplant services must be authorized by a primary care physician within the primary care clinic.
   
   
5. Cardiac services. No coverage for non-emergency cardiac services obtained from out-of-network providers. Referrals for services must be authorized by a primary care physician within the primary care clinic.
   
   
6. Home Infusion Therapy. The SHPPOS and SHPS shall provide Home Infusion Therapy coverage as specified in their respective Certificates of Coverage. No coverage for services obtained from out-of-network providers. Referrals for eligible Home Infusion Therapy services must be authorized by a primary care physician within the primary care clinic.
   
   
7. Hospice Benefit. One hundred (100) percent coverage for services obtained from in-network providers. Seventy (70) percent coverage for services obtained from out-of-network providers under SHPPOS.

d.	Services not requiring authorization by a primary care physician within the primary care clinic. The following services do not require authorization by a primary care physician within the primary care clinic in order to be covered.

1. Prescription drugs.

Insulin will be treated as a prescription drug subject to a separate copay for each type prescribed. If the subscriber chooses a brand name drug when a bioequivalent generic drug is available, the subscriber is required to pay the standard copayment plus the difference between the cost of the brand name drug and the generic. SHPS. Prescription Drugs. For the 1998 and 1999 insurance years: eight dollar ($8) copayment per prescription or refill for a formulary drug dispensed in a thirty four (34) day supply. all diabetic supplies, including test tapes and syringes, are covered under the available medical equipment benefit at eighty percent (80%) and are not subject to the thirty-four (34) day or one hundred (100) unit dispensing limitation.

SHPPOS. Prescription Drugs. For the 1998 and 1999 insurance years. eight dollar ($8) copayment per prescription or refill for a formulary drug dispensed in a thirty four (34) day supply, or a one hundred (100) day supply for approved maintenance drugs; fourteen dollar ($14) for non-formulary drugs; one hundred (100) percent coverage after copayment. A prescription for a non-formulary drug will be treated as formulary if the physician has written Dispense as Written (DAW) on the prescription.

 

Diabetic supplies.

Beginning with the 1992 plan year, any diabetics not included in the "Grandfathered Diabetic Group" described in paragraph "2." below will have diabetic supplies covered as follows:

• All diabetic supplies, other than test tapes and syringes, are covered under the durable medical equipment benefit at eighty percent (80%) and are not subject to the thirty four (34) day or one hundred (100) unit dispensing limitation.
  
  
• Test tapes and syringes: an eight dollar ($8) copayment for a thirty-four (34) day supply of each.

For insulin dependent diabetics who have been continuously enrolled in the State Health Plan since January 1, 1991 and who were identified as having used these supplies during the period January 1, 1991 through September 30, 1991, (hereinafter the "Grandfathered Diabetic Group") diabetic supplies are covered as follows:

• Test tapes and syringes are covered at one hundred (100) percent for the greater of a thirty four (34) day supply or one hundred (100) units when purchased with insulin.
  
  
• All other diabetic supplies, including test tapes and syringes not dispensed with the purchase of insulin, are covered under the durable medical equipment benefit at eighty percent (80%) and are not subject to the thirty four (34) day or one hundred (100) unit dispensing limitation.

1. Eye exams. SHPPOS and SHPS. One hundred (100) percent coverage. (Limited to one routine examination per year.)
   
   
2. Outpatient emergency and urgicenter services. SHPPOS and SHPS. Thirty dollar ($30) copayment per visit for outpatient emergency visits and fifteen dollar ($15) copayment per visit for urgicenter visits that do not result in hospital admission within twenty-four (24) hours; one hundred (100) percent coverage thereafter.
   
   
3. Ambulance. SHPPOS and SHPS. Eighty (80) percent coverage for eligible expenses. (Air ambulance paid to ground ambulance coverage limit only, unless ordered "first response" or if air ambulance is the only medically acceptable means of transport as certified by the attending physician.)

e.

Lifetime maximum. SHPPOS and SHPS. Coverage under the State Health Plan is subject to a per-person lifetime maximum. The lifetime maximum is two million dollars ($2,000,000) for services under 6A2a, 6A2c and 6A2d combined. The lifetime maximum for services under 6A2b is limited to five hundred thousand dollars ($500,000). The five hundred thousand dollar ($500,000) maximum which applies under 6A2b is part of, and not in addition to, the two million dollar ($2,000,000) lifetime plan maximum.

1. Coordination with Workers' Compensation. When a manager has incurred an on-the-job injury or an on-the-job disability and has filed a claim for workers' compensation, medical costs connected with the injury or disability shall be paid by the manager's health plan, pursuant to M.S. 176.191, subdivision 3.
   
   
2. Health Promotion and Health Education. The Employer recognizes the value and importance of health promotion and health education programs. Such programs can assist managers and their dependents to maintain and enhance their health, and to make appropriate use of the health care system. To work toward these goals:

a.	Develop Programs. The Department of Employee Relations will develop and implement health promotion and health education programs, subject to the availability of resources. Each Appointing Authority will develop a health promotion and health education program consistent with the Department of Employee Relations policy. Program topics shall include but are not limited to smoking cessation, weight loss, stress management, health education/self-care, and education on related benefits provided through the State Health Plan and HMO plans.
b.	Health Plan Specification. The Employer will require health plans participating in the Group Insurance Program to develop and implement health promotion and health education programs for State managers and their dependents.
c.	Manager Participation. The Employer will assist managers' participation in health promotion and health education programs. Health promotion and health education programs that have been endorsed by the Employer (Department of Employee Relations) will be considered to be non-assigned job-related training pursuant to Administrative Procedure 21B. Approval for this training is at the discretion of the Appointing Authority and is contingent upon meeting staffing needs in the manager's absence and the availability of funds. Managers are eligible for release time, tuition reimbursement, or a prorata combination of both. Managers may be reimbursed for up to one hundred (100) percent of tuition or registration costs upon successful completion of the program.
d.	Health Promotion Incentives. The Joint Labor-Management Committee on Health Plans shall develop a program which provides incentives for managers who participate in a health promotion program. The health promotion program shall emphasize the adoption and maintenance of more healthy lifestyle behaviors and shall encourage wiser usage of the health care system.

1. Coverage Options. Eligible managers may select coverage under any one of the dental plans offered by the Employer, including health maintenance organization plans, the State Dental Plan, or other dental plans.
   
   
2. Coverage Under the State Dental Plan. The State Dental Plan will provide the following coverage:

a.	Copayments. Effective December 24, 1997, the State Dental Plan will cover allowable charges for the following services subject to the copayments and coverage limits stated. Higher out-of-pocket costs apply to services obtained from dental care providers not in the State Dental Plan network. Services provided through the State Dental Plan are subject to the State Dental Plan's managed care procedures and principles, including standards of dental necessity and appropriate practice. The plan shall cover general cleaning two (2) times per plan year and special cleanings (root or deep cleaning) as prescribed by the dentist. Service In-Network Out-of-Network Diagnostic/Preventive 100% 50% Fillings 80% 50% Endodontics 80% 50% Periodontics 80% 50% Oral Surgery 80% 50% Crowns 80% 50% Prosthetics 50% None Prosthetic Repairs 50% None Orthodontics* 80% 50%
	(Please refer to your Certificate of Coverage for information regarding age limitation for dependent orthodontic care.
b.	Deductible. An annual deductible of one hundred dollars ($100) per person applies to State Dental Plan basic and special services received from out of network providers. The deductible must be satisfied before coverage begins.
c.	Annual Maximums. State Dental Plan coverage is subject to a one thousand dollar ($1,000) annual maximum in eligible expenses per person. "Annual" means per insurance year.

1. Basic Managerial Life, Accidental Death and Dismemberment (AD&D) Coverage, and Disability Insurance. The Employer agrees to provide and pay for the following coverage in either Plan A or Plan B for all managers eligible for a full or partial Employer Contribution, as described in Section 3. Any premium paid by the State in excess of fifty thousand dollars ($50,000) coverage is subject to a tax liability in accord with Internal Revenue Service regulations. A manager may decline coverage in excess of fifty thousand dollars ($50,000) by filing a waiver in accord with Department of Finance procedures.
   
   Managers select coverage under either Plan A or Plan B below. Both plans provide employer paid life and AD&D coverage. Plan A also includes employer paid disability coverage.

Plan A:

Employer paid life and AD&D coverage equal to one and one-half times annual salary and disability insurance with a one hundred and fifty (150) calendar day elimination period. Managers may elect to purchase shorter elimination periods for disability insurance of thirty (30), sixty (60), ninety (90) or one hundred and twenty (120) days, based on their accrued sick leave balance. The disability benefit, after the elimination period, is sixty (60) percent of a manager's salary to a maximum of $3,500/month.

Plan B:

Employer paid life and AD&D coverage equal to two times annual salary.

Managers may elect to purchase disability insurance at the manager's own expense. Managers may elect to purchase shorter elimination periods of thirty (30), sixty (60), ninety (90), one hundred and twenty (120) or one hundred and fifty (150) days based on their accrued sick leave balance.

The disability benefit, after the elimination period, is sixty (60) percent of a manager's salary to a maximum of $3,500/month.

Disability insurance elimination periods. Elimination periods can be changed once a year. The Group Benefits Plan brochure for the Managers Income Protection Plan contains information on when changes require evidence of insurability.

1. Extended Benefits. A manager who becomes totally disabled before age 70 shall be eligible for the extended benefit provisions of the life insurance policy until age 70. Current recipients of extended life insurance shall continue to receive such benefits under the terms of the policy in effect prior to July 1, 1983.
   
   
2. Additional Death Benefit. Managers who retire on or after July 1, 1985, shall be entitled to a five hundred dollar ($500) death benefit payable to a beneficiary designated by the manager, if at the time of death the manager is entitled to an annuity under a State retirement program. A five hundred dollar ($500) cash death benefit shall also be payable to the designated beneficiary of a manager who becomes totally and permanently disabled on or after July 1, 1985, and who at the time of death is receiving a State disability benefit and is eligible for a deferred annuity under a State retirement program.

Section 7. Optional Coverages. A manager who takes an unpaid leave of absence or who is laid off may discontinue premium payments on short-term disability and optional employee, spouse and child life policies during the period of leave or layoff. If the manager returns within one (1) year, the manager shall be permitted to pick up all optionals held prior to the leave or layoff. For purposes of reinstating such optional coverages, the following limitations shall be applicable.

1. For the first twenty four (24) months of short-term disability coverage after such a period of leave or layoff, any such disability coverage shall exclude coverage for certain pre-existing conditions. For disability purposes, a pre-existing condition is defined as any disability which is caused by, or results from, any injury, sickness or pregnancy which occurred, was diagnosed, or for which medical care was received during the period of leave or layoff. In addition, any pre-existing condition limitations that would have been in effect under the policy but for the discontinuance of coverage shall continue to apply as provided in the policy.
   
   
2. For the first twenty four (24) months of optional life coverage after such a period of leave or layoff, any such optional life coverage shall exclude coverage for certain pre-existing conditions. For optional life purposes, any death which is caused by, or results from any injury or sickness which occurred, was diagnosed, or for which medical care was received during the period of leave or layoff shall be excluded from coverage for such twenty four- (24-) month period.

The limitations set forth in 1. and 2. above do not apply to Family Medical Leave Act (FMLA) leaves.

1. Manager. A manager may purchase up to three hundred thousand dollars ($300,000) additional life insurance, in increments established by the Employer, subject to satisfactory evidence of insurability. Upon initial appointment to state service, a new manager may purchase up to two (2) times annual salary or two hundred thousand dollars ($200,000), whichever is less, in optional employee life coverage within sixty (60) calendar days of hire without evidence of insurability.
   
   
2. Spouse. A manager may purchase up to three hundred thousand dollars ($300,000) life insurance coverage for his/her spouse, in increments established by the Employer, subject to satisfactory evidence of insurability. Upon initial appointment to state service, a new manager may purchase either five thousand dollars ($5,000) or ten thousand dollars ($10,000) in optional spouse life coverage within sixty (60) calendar days of hire without evidence of insurability.
   
   
3. Children/Grandchildren. A manager may purchase life insurance in the amount of ten thousand dollars ($10,000) as a package for all eligible children/grandchildren (as defined in Section 2C of this Chapter). Child/grandchild coverage requires evidence of insurability if application is made after the first sixty (60) calendar days of employment. Child/grandchild coverage commences fourteen (14) calendar days after birth.
   
   
4. Waiver of Premium. In the event a manager becomes totally disabled before age seventy (70), there shall be a waiver of premium for all life insurance coverage that the manager had at the time of disability.
   
   
5. Paid Up Life Policy. At age sixty-five (65) or the date of retirement, a manager who has carried optional life insurance for the five (5) consecutive years immediately preceding the date of the manager’s retirement or age sixty-five (65), whichever is later, shall receive a post-retirement paid-up life insurance policy in an amount equal to ten (10) percent of the smallest amount of optional manager life insurance in force during that five (5) year period. The manager’s post-retirement death benefit shall be effective as of the date of the manager’s retirement or the manager age sixty-five (65), whichever is later. Managers who retire prior to age sixty-five (65) must be immediately eligible to receive a state retirement annuity and must continue their optional manager life insurance to age sixty-five (65) in order to remain eligible for the manager post-retirement death benefit.
   
   A manager who has carried optional spouse life insurance for the five (5) consecutive years immediately preceding the date of the manager’s retirement or spouse age sixty-five (65), whichever is later, shall receive a post-retirement paid-up life insurance policy in an amount equal to ten (10) percent of the smallest amount of optional spouse life insurance in force during that five (5) year period. The spouse post-retirement death benefit shall be effective as of the date of the manager’s retirement or spouse age sixty-five (65), whichever is later. The manager must continue the full amount of optional spouse life insurance to the date of the manager’s retirement or spouse age sixty-five (65), whichever is later, in order to remain eligible for the spouse post-retirement death benefit.
   
   Each policy remains separate and distinct, and amounts may not be combined for the purpose of increasing the amount of a single policy.

1. Short-term Disability Coverage. An employee who carries short-term disability and is promoted to a managerial position may continue the coverage in force at that time. The manager may decrease or cancel the coverage, but may not increase the coverage.
   
   
2. Long-term Disability Coverage. An employee who is promoted to a managerial position is eligible for long-term disability coverage only through the Income Protection Plan.