(a) If an employee elects to participate in a cafeteria plan, the employee must execute a salary reduction agreement under which the employee’s monthly compensation will be reduced in an amount equal to the difference between:
(1) the amount appropriated for that purpose in the General Appropriations Act or the system’s budget; and
(2) the cost of the employee’s selected coverages for which the employee is eligible to pay under the cafeteria plan.
(b) The employee must execute a salary reduction agreement for any portion of the cost that is not covered by state or system appropriations and cafeteria plan contributions.