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ARIZONA STATE SENATE
Fifty-Fifth Legislature, First Regular Session
ASRS; self-insurance program
Purpose
Background
Current statute allows the ASRS Board of Trustees (ASRS Board) to establish a self‑insurance program if the ASRS Board determines that self-insuring would be less expensive than, and at least as effective as, a fully insured plan, while considering the risks and costs. If the ASRS Board establishes a self-insurance program, the program must include all statutorily required health coverage benefits. The ASRS Board must establish a separate account for any self‑insurance program in an amount determined appropriate by ASRS. ASRS may not use or divert any part of the corpus or income of the account for any purpose other than to administer the program, unless the ASRS Board determines that a self-insurance program should no longer be offered. If a self-insurance program is no longer offered, monies in a separate account must be transferred to another account of ASRS (A.R.S. § 38-782).
In 2016, the Legislature required the Public Safety Personnel Retirement System (PSPRS) Board to establish, design and administer a defined contribution retirement plan (DC plan). A DC plan is a retirement plan in which the employer, employee or both make contributions on a regular basis (Laws 2016, Chapter 2).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Prohibits ASRS from using or diverting money from a self-insurance program account for any purpose other than to provide benefits and to pay administration costs and premium payments, rather than only to administer the program.
6. Makes technical changes.
7. Becomes effective on the general effective date.
Prepared by Senate Research
January 15, 2021
MG/FDR/gs