[HISTORY: Adopted by the Township Council
of the Township of Parsippany-Troy Hills as indicated in article histories. Subsequent amendments noted where applicable.]
GENERAL REFERENCES
Personnel policies — See Ch.
57.
[Adopted 12-20-2016 by Ord. No. 2016:31]
There is hereby established a combined self-funded health insurance
plan and self-funded workers' compensation plan for Township
employees to be collectively known as the "Township of Parsippany-Troy
Hills Self-Funded Insurance Plan" (the "Plan"). There is further established
in accordance with the provisions of N.J.S.A. 40A:10-6 et seq. an
insurance fund to be known as the "Township of Parsippany-Troy Hills
Self-Insurance Fund" (the "Fund"). The Plan and the Fund shall be
operated and maintained in accordance with the terms of: i) N.J.S.A.
40A:10-6 et seq.; ii) this article, the agreement between the Township
and its third-party administrator ("TPA"), any final nonappealable
directives issued by a governmental agency with respect to the Plan
(collectively, the "Plan documents"); and iii) the rules and regulations
promulgated by the Department of Community Affairs.
There is hereby established in accordance with the requirements
of N.J.S.A. 40A:10-8 a Fund Commission (the "Commission") consisting
of the Township Business Administrator, the Township Chief Financial
Officer, and one official of the Township and a Secretary of the Commission
to be appointed by the Mayor, with the advice and consent of the Township
Council. The Commissioners shall hold office for two years or for
the remainder of their term as officials, whichever is less, and until
their successors shall have been duly appointed and qualified. The
Secretary shall serve at the pleasure of the Commission. The Commissioners
shall serve without compensation. The compensation of the Secretary,
if any, shall be established and authorized by the Township Council.
Vacancies occurring on the Commission shall be filled for the unexpired
term through appointment by the Mayor. The Commissioners shall forthwith
after appointment organize for the ensuing year by electing a Chairman
from among their membership.
In order to maintain the efficient, professional and actuarially
sound operation of the Fund, the Township will contract with a qualified
TPA to assist the Township and the Commission in the proper design
and administration of the Plan. Subject to consultation and review
by the Mayor, the Commissioners shall have the power and duty to oversee
the TPA, adopt rules and regulations for the control and investment
of the Fund, assure that the Fund has sufficient funds for payment
of losses and claims, invest assets of the Fund in accordance with
the Township's established investment policy and as provided
by law and approved by the Township CFO, and assure the proper operation
of the Plan and the Fund consistent with their purpose. The Commission
shall have the authority to authorize and effectuate the payment of
Fund-related claims and take such other action as is necessary to
effectuate the Fund and the contract with the TPA regarding the Fund.
The purpose of the Fund is to hold, manage and distribute funds
in accordance with the Plan documents. The Fund exists to pay health
care claims and related expenses covered by the Plan and the Fund
shall not be used for any other purpose.
The Commissioners and the TPA shall cause the Fund to achieve
a reasonable reserve of up to one year of claims payments to assure
that sufficient assets are available to continue to pay all claims
and expenses in a high claims year.
Claims shall be administered and paid, after review, by the
TPA in accordance with the TPA administration contract. The TPA shall
assure that all Township employees covered by the Plan are fully informed
as to the proper procedure for submitting claims and that all notices
required by law with respect to the Plan are promptly provided to
the plan participants.
The Township, directly or through the TPA, shall arrange for
the purchase of "stop loss" or "excess" coverage in order to provide
ascertainable limits to the liability of the Fund. Such coverage shall
include, but need not be limited to, coverage for catastrophic illness
for plan participants, aggregate coverage (below catastrophic coverage)
to assure that the Plan's risk level is capped at a maximum amount
as established by the Township in consultation with the Commissioners
and the TPA, and run-out coverage to allow claims incurred during
the plan year to be paid out for a period of three months after the
end of the plan year. The Plan shall also include a requirement that
the Township shall, directly or through the TPA, contract for liability
insurance pursuant to the Employee Retirement Income Security Act
of 1974 ("ERISA"), which shall include responsibility for handling all second
level appeals.
Appeals from denial of claims shall, in the first instance,
be reviewed by the TPA. In considering appeals, any relevant supplemental
information provided by the plan participant or the service provider
shall be considered. Second level appeals shall be handled by a third
party retained to review appeals on an independent basis according
to the Plan documents. In order to assure that the Plan is consistently,
fairly and equitably administered, the approval or denial of individual
claims shall in all cases be determined by the terms of the Plan.
The Commission shall annually, in consultation with the Township
Council and coordination with its TPA and other professional consultants,
review and evaluate the Plan, and evaluate the Plan in comparison
to plan designs offered by the New Jersey State Health Benefit Plan.
The base plan option of the Township's Plan shall be modified
to mirror the design of the base plan option offered by the State
Health Benefit Plan. This review shall occur at the same time as the
annual open enrollment period. At no time will the Township be required
to offer base plan benefits greater than those offered by the State
Health Benefit Plan.
The Fund shall continue from year to year without lapse until
the Self-Funded Insurance Plan is terminated by action of the Township
Council. In the event of such a termination, after payment of all
claims and expenses of the Plan, any fund balance remaining shall
revert to the Township's general fund.