Sec. 2.6. (a) This section applies only to local unit public employers and their employees. This section does not apply to public safety employees, surviving spouses, and dependents covered by section 2.2 of this chapter.

     (b) A public employer may provide programs of group insurance for its employees and retired employees. The public employer may, however, exclude part-time employees and persons who provide services to the unit under contract from any group insurance coverage that the public employer provides to the employer’s full-time employees. A public employer may provide programs of group health insurance under this section through one (1) of the following methods:

(1) By purchasing policies of group insurance.

(2) By establishing self-insurance programs.

(3) If the local unit public employer is a school corporation, by electing to provide the coverage through a state employee health plan under section 6.7 of this chapter.

A public employer may provide programs of group insurance other than group health insurance under this section by purchasing policies of group insurance and by establishing self-insurance programs. However, the establishment of a self-insurance program is subject to the approval of the unit’s fiscal body.

     (c) A public employer may pay a part of the cost of group insurance, but shall pay a part of the cost of group life insurance for local employees. A public employer may pay, as supplemental wages, an amount equal to the deductible portion of group health insurance as long as payment of the supplemental wages will not result in the payment of the total cost of the insurance by the public employer.

     (d) An insurance contract for local employees under this section may not be canceled by the public employer during the policy term of the contract.

     (e) After June 30, 1986, a public employer shall provide a group health insurance program under subsection (g) to each retired employee:

(1) whose retirement date is:

(A) after May 31, 1986, for a retired employee who was a teacher (as defined in IC 20-18-2-22) for a school corporation; or

(B) after June 30, 1986, for a retired employee not covered by clause (A);

(2) who will have reached fifty-five (55) years of age on or before the employee’s retirement date but who will not be eligible on that date for Medicare coverage as prescribed by 42 U.S.C. § 1395 et seq.;

(3) who will have completed twenty (20) years of creditable employment with a public employer on or before the employee’s retirement date, ten (10) years of which must have been completed immediately preceding the retirement date; and

(4) who will have completed at least fifteen (15) years of participation in the retirement plan of which the employee is a member on or before the employee’s retirement date.

     (f) A group health insurance program required by subsection (e) must be equal in coverage to that offered active employees and must permit the retired employee to participate if the retired employee pays an amount equal to the total of the employer’s and the employee’s premiums for the group health insurance for an active employee and if the employee, within ninety (90) days after the employee’s retirement date, files a written request with the employer for insurance coverage. However, the employer may elect to pay any part of the retired employee’s premiums.

     (g) A retired employee’s eligibility to continue insurance under subsection (e) ends when the employee becomes eligible for Medicare coverage as prescribed by 42 U.S.C. § 1395 et seq., or when the employer terminates the health insurance program. A retired employee who is eligible for insurance coverage under subsection (e) may elect to have the employee’s spouse covered under the health insurance program at the time the employee retires. If a retired employee’s spouse pays the amount the retired employee would have been required to pay for coverage selected by the spouse, the spouse’s subsequent eligibility to continue insurance under this section is not affected by the death of the retired employee. The surviving spouse’s eligibility ends on the earliest of the following:

(1) When the spouse becomes eligible for Medicare coverage as prescribed by 42 U.S.C. § 1395 et seq.

(2) When the employer terminates the health insurance program.

(3) Two (2) years after the date of the employee’s death.

(4) The date of the spouse’s remarriage.

     (h) This subsection does not apply to an employee who is entitled to group insurance coverage under IC 20-28-10-2(b). An employee who is on leave without pay is entitled to participate for ninety (90) days in any group health insurance program maintained by the public employer for active employees if the employee pays an amount equal to the total of the employer’s and the employee’s premiums for the insurance. However, the employer may pay all or part of the employer’s premium for the insurance.

     (i) A public employer may provide group health insurance for retired employees or their spouses not covered by subsections (e) through (g) and may provide group health insurance that contains provisions more favorable to retired employees and their spouses than required by subsections (e) through (g). A public employer may provide group health insurance to an employee who is on leave without pay for a longer period than required by subsection (h), and may continue to pay all or a part of the employer’s premium for the insurance while the employee is on leave without pay.

As added by P.L.1-1991, SEC.33. Amended by P.L.286-2001, SEC.2; P.L.1-2005, SEC.76; P.L.182-2009(ss), SEC.66; P.L.91-2014, SEC.10.