Request By:
Mike Kurtsinger, Kentucky Professional Firefighters
Opinion
Opinion By: ALBERT B. CHANDLER III, ATTORNEY GENERAL; BILL PETTUS, ASSISTANT ATTORNEY GENERAL
OPINION OF THE ATTORNEY GENERAL
Your February 5, 1998, letter to this Office requests an Attorney General's opinion on "whether the Pension Board is required to provide a certain level of benefits for health care to retirees. " You state that KRS 18A.225 provides that state employees' benefits, at a minimum, are to be at the 1994 Kentucky Care standard level of benefit.
Although your question is somewhat ambiguous, it is assumed that you are asking whether the Kentucky Retirement Systems is required to provide a retired state employee health insurance coverage equal to or greater than the level provided by Kentucky Kare Standard as of January 1, 1994. The answer is yes.
This presents a difficult question yet to be addressed by our courts. As such, we must apply rules of statutory construction to determine the meaning of an ambiguous term subject to varying meanings. Of course, the overall effect of the statute is dependent on the meaning of that term. Thus, our opinion is only a forecast of how a court may answer this question and as a forecast, it must be accepted that a court presented with this issue may well provide a different interpretation.
ANALYSIS
KRS 18A.225(2) provides in part as follows:
. . . Health insurance coverage provided to state employees under this section shall, at a minimum, contain the same benefits as provided under Kentucky Kare Standard as of January 1, 1994. . . .
The phrase "state employee, " as used in KRS 18A.225, includes the following:
[A] person, including an elected public official, who is regularly employed by any department, board, agency, branch of state government, or any municipal urban-county, charter county, or county government, whose legislative body has opted to participate in the state health insurance program pursuant to KRS 79.080 and who is a contributing member to any one (1) of the retirement systems administered by the state and including any federally-funded time-limited employee. It shall also include a person who must fulfill the requirements established by the Kentucky Board of Education for eligibility and a person who is a present or future recipient of a retirement allowance from any of the Kentucky Retirement Systems who either satisfies the requirements of KRS 61.559 or who is board authorized under KRS 61.702(1), including a beneficiary of a retired employee as defined in KRS 61.542 who is receiving a retirement allowance from any of the Kentucky Retirement Systems and includes members of the Legislators' Retirement Plan as provided in KRS 18A.2287.
(Italics added.)
The definition of "state employee, " as used in KRS 18A.225(2), includes a person who is (a) receiving a retirement allowance from any of the Kentucky Retirement Systems and (b) meets either the requirements of KRS 61.559 or is board authorized under KRS 61.702(1). Consequently, a retired "state employee, " as used in KRS 18A.225(2) and as defined by KRS 18A.225(1), is entitled to health insurance coverage equal to or greater than the level provided by Kentucky Kare Standard as of January 1, 1994.
The critical issue to determine in answering the question is in defining the term "benefits" and defining the phrase "same benefits as provided under Kentucky Kare Standard as of January 1, 1994" as used in KRS 18A.225(2). One interpretation that has been advanced is that this subsection merely requires the state to provide retirees with the same funds or money, adjusted by inflation, that it cost to purchase Kentucky Kare Standard as of January 1, 1994. Under this interpretation, "benefits" is effectively defined as a specific amount of money and it is irrelevant whether retirees can purchase any specific health insurance plan with the amount of money provided by the state for the purchase of an health insurance plan. An alternative interpretation is that "benefits" means the actual "package of entitlements" received with the purchase of a health insurance plan, specifically the "package of entitlements" available under Kentucky Kare Standard as of January 1, 1994. Obviously, whichever meaning is selected provides the answer to the question posed. As such, this again is our best effort at statutory construction.
KRS 18A.225(2) as presently written was part of HB 250. It was enacted in 1994 and became effective July 15, 1994. The term "benefits" as used in this subsection is not statutorily defined by KRS Chapter 18A. There are no published court decisions construing the term "benefits." Consequently, this presents an issue of first impression. Without a statutory definition of "benefits" or common law precedent, the legal analysis in this opinion will necessarily have to be guided by principles of statutory construction.
All words and phrases shall be construed according to the common and approved usage of language, but technical words and phrases, and such others as may have acquired a peculiar and appropriate meaning in the law, shall be construed according to such meaning.
KRS 446.080(4). The word "benefits" is not a technical word and has not acquired any particular meaning in the law. Consequently, "benefits" must be construed according the "common and approved usage of language" pursuant to KRS 446.080(4).
"Benefit" is defined as "[p]ayments made or entitlements available in accord with a wage agreement, insurance contract, or public assistance program." Webster's II New Riverside University Dictionary (2nd ed. 1988) (Italics added).
KRS 18A.225(2) does not, of course, require the Kentucky Retirement Systems to provide retired state employees with health insurance coverage from Kentucky Kare. There is absolutely no language in the statute that requires Kentucky Retirement Systems to offer any specific health insurance benefit plan from any specific company. Nor can such language be supplied by a court or other adjudicatory body.
[W]here a statute on its face is intelligible, the courts are not at liberty to supply words or insert something or make additions which amount . . . to providing for a casus omissus, or cure an omission, however just or desirable it might be to supply an omitted provision. It makes no difference that it appears the omission was mere oversight.
Hatchett v. City of Glasgow, 340 S.W.2d 248, 251 (Ky. 1960). (Italics in original.)
The General Assembly clearly used the level of benefits available under the 1994 Kentucky Kare Plan as the point of comparison for future benefits that would be provided. It did not mandate a particular form of coverage and did not require that the state provide a specific dollar amount for a retired employee to purchase a particular plan.
KRS 18A.225(2) merely requires Kentucky Retirement Systems to provide state employees with health insurance coverage containing "the same benefits as provided under Kentucky Kare Standard as of January 1, 1994." (Italics added.) Kentucky Retirement Systems may offer retired state employees health insurance benefit plans from other companies that contain "the same benefits as provided under Kentucky Kare Standard as of January 1, 1994," and thereby satisfy the requirements of KRS 18A.225(2).
"Benefits" as used in KRS 18A.225(2) is commonly understood to mean the package of entitlements available under a particular health insurance plan. Webster's II New Riverside University Dictionary (2nd ed. 1988). "Benefits" is not commonly understood to mean the cost, premium, or value of the entitlements available under a particular health insurance plan.
This statutory interpretation is implicitly supported by statements contained in "A Citizen's Handbook: Kentucky's Health Care Reform," a publication of the Legislative Research Commission published in May 1994 to explain HB 250. In this publication, at page 10, it is stated that HB 250 "[r]equires that health insurance provided to state employees contain at least the same coverage as Kentucky Kare Standard as of January 1, 1994." The publication, at page 11, also states that the Kentucky Health Purchasing Alliance is required "to offer a plan that is exactly the same as Kentucky Kare Standard as of January 1, 1994."
The health insurance coverage plans presently provided by Kentucky Retirement Systems to retired state employees includes Kentucky Kare insurance benefit plans (budget high, economy low, standard low, standard high, and enhanced high). Some of these plans may offer benefits that provide "the same benefits as provided under Kentucky Kare Standard as of January 1, 1994," and some of these plans may not. If the Kentucky Kare plans presently offered to retired state employees do not provide "the same benefits as provided under Kentucky Kare Standard as of January 1, 1994," without additional cost to retired state employees, this would not necessarily be a violation of KRS 18A.225(2). If retired state employees are offered other health insurance plans that provide "the same benefits as provided under Kentucky Kare Standard as of January 1, 1994," then the requirements of KRS 18A.225(2) would be satisfied.
A factual comparison and analysis of the various Kentucky Kare health insurance benefit plans (budget high, economy low, standard low, standard high, and enhanced high) and other health insurance plans presently offered to retired state employees to determine which of the present plans offer the "same" or greater benefits with the Kentucky Kare Standard plan offered state employees in January 1, 1994, is beyond the scope of this opinion. This is necessarily a factual determination that can only be made on the basis of factual information that has not been provided. The purpose of this opinion is to provide guidancein interpreting the statutory language of KRS 18A.225(2) on its face, not to adjudicate any factual dispute that may occur concerning whether the statute is being properly applied by the Kentucky Retirement Systems.