SB127 Alabama 2013 Session

Summary

Primary Sponsor

Mark Slade Blackwell

Republican

Session

Regular Session 2013

Title

State Employees' Insurance board, high deductible health plan authorized, linking with a federally qualified health saving account and a federally qualified health reimbursement arrangement (HRA)

Summary

The bill would let Alabama's State Employees' Insurance Board offer a high-deductible health plan paired with a Health Savings Account and a Health Reimbursement Arrangement to eligible state employees, retirees, and their dependents.

What This Bill Does

The bill authorizes the State Employees' Insurance Board to offer a High Deductible Health Plan with a Federally Qualified Health Savings Account (HDHP-HSA) to eligible active and retired state employees and their dependents, but excludes Medicare-eligible retirees from HDHP-HSA participation. It allows employer contributions to HSAs and Health Reimbursement Arrangements (HRAs) from the State Employees' Insurance Fund, with these contributions not counted as employee compensation, and it lets participants contribute their own funds through voluntary salary reductions, while those reductions still count toward retirement benefits. The terms of the HDHP-HSA and HRA must comply with federal rules, and the act becomes law immediately upon governor approval and repeals conflicting laws.

Who It Affects

• Eligible active and retired state employees and their dependents would be able to enroll in the HDHP-HSA (and potentially an HRA) with employer contributions and salary-reduction options.
• Medicare-eligible retirees would not be eligible to participate in the HDHP-HSA.

Key Provisions

• Authorizes the State Employees' Insurance Board to offer a High Deductible Health Plan with a Federally Qualified Health Savings Account (HDHP-HSA) to eligible active and retired state employees and their dependents; Medicare-eligible retirees cannot participate in the HDHP-HSA.
• Allows the board to set the terms and conditions for the HDHP-HSA in line with federal rules and to provide employer contributions to HSAs from the State Employees' Insurance Fund; employer contributions are not considered compensation.
• Allows participants to contribute their own funds to an HSA through voluntary salary reductions, with the reduced wages still counted as earnable compensation for retirement benefits.
• Authorizes the board to offer a Health Reimbursement Arrangement (HRA) to eligible active and retired state employees and dependents, with terms set per federal requirements and employer contributions to HRAs not counted as compensation.
• Repeals conflicting laws and makes the act effective immediately upon the Governor's approval.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

State Employees