A BILL TO BE ENTITLED
AN ACT to provide for competitive selection of supplemental insurance products for retirees.
The General Assembly of North Carolina enacts:
SECTION 1.  Chapter 135 of the General Statutes is amended by adding a new Article to read:
"Article 7.
"Supplemental Insurance Products for Retirees.
"§ 135‑120.  Competitive selection of supplemental insurance products paid for by retirees.
(a)	Duties of the Department of State Treasurer. – The Department of State Treasurer shall:
(1)	Review insurance products currently offered through retirement benefit payment deduction to retirees from the Teachers' and State Employees' Retirement System, the Local Governmental Employees' Retirement System, the Legislative Retirement System, and the Consolidated Judicial Retirement System to determine if those products meet the needs and desires of retirees.
(2)	Select the types of insurance products that reflect the needs and desires of retirees.
(3)	Competitively select insurance products of the types determined by the Department of State Treasurer to reflect the needs and desires of retirees.
(b)	Retirement Benefit Payment Deductions. – The company or companies selected by the Department of State Treasurer shall be permitted to sell through retirement benefit payment deduction only the products specifically approved by the Department of State Treasurer. The assignment by the Department of State Treasurer of a retirement benefit payment deduction shall be for a period of not less than two years unless the insurance company violates the terms of the written agreement specified in this subsection. Subject to the provisions of subsection (d) of this section, the insurance company awarded a retirement benefit payment deduction shall, pursuant to a written agreement setting out the rights and duties of the insurance company, be afforded an adequate opportunity to solicit retirees. The selected insurance company shall provide information about retirement benefit payment deduction. The Department of State Treasurer shall determine the format and medium the insurance company may use to provide the information to retirees.
(c)	Procedure for Selection of Supplemental Insurance Product Proposals. – The following procedures shall apply to the selection of all supplemental insurance products under this section:
(1)	All supplemental insurance product proposals shall be sealed. The Department of State Treasurer shall open all proposals in public, at which time the proposals become public records open to public inspection.
(2)	After the public opening, a committee designated by the Department of State Treasurer shall review the proposals and examine the cost, coverage, and quality of the products, the reputation and capabilities of the insurance companies submitting the proposals, and other appropriate criteria. The committee shall determine which proposal, if any, would meet the needs and desires of the retirees, and may reject any or all proposals. Upon completion of its review, the committee shall present its findings to the Board of Trustees and make recommendations as to the awarding of a service contract. Upon acceptance of the committee's findings and recommendations, the Board of Trustees shall award a contract to make retirement benefit deductions for supplemental insurance products to the company submitting the proposal that best meets the needs and desires of the retirees. 
(3)	A company may seek to modify or withdraw a proposal only after the public opening and only on the basis that the proposal contains an unintentional clerical error as opposed to an error in judgment. A company seeking to modify or withdraw a proposal shall submit to the Department of State Treasurer a written request, with facts and evidence in support of its position, prior to the award of the retirement benefit payment deduction slot, but not later than two days after the public opening of the proposals. The Department of State Treasurer shall promptly review the request, examine the nature of the error, and determine whether to permit or deny the request.
(d)	Confidentiality of Names and Addresses of Retired State and Local Employees. – The Department of State Treasurer shall provide the selected insurance company with the names and addresses of retirees in order for the company to provide information to retirees about purchasing their selected insurance product. The selected company shall keep the names and addresses of the retirees confidential and shall not provide the information to any third party or use the information to solicit retirees for insurance products other than those selected by the Department of State Treasurer. The insurance company shall provide retirees with each solicitation the option to elect not to receive any future solicitations by providing a preaddressed and postage prepaid card the retiree may return to the insurance company.
(e)	Option to Continue Supplemental Insurance. – At the termination of any contract entered into under this section, or when retirement benefit payment deduction is no longer available for a product, the insurance company shall provide covered retirees the option to continue supplemental insurance on a direct billing basis. When retirement benefit payment deduction is no longer available, the insurance company may not terminate insurance products purchased under the retirement benefit payment deduction plan without the retiree's specific written consent solely because the premium is no longer deducted from retirement benefit payments."
SECTION 2.  This act is effective when it becomes law.