STATE OF SOUTH DAKOTA
OFFICE OF
THE ATTORNEY GENERAL
June 30, 1975
Mr. Floyd E. Meidinger
McPherson County States Attorney
Leola, South Dakota 57456
OFFICIAL OPINION NO. 75-122
Group health insurance contracts for county officers and employees
Dear Mr. Meidinger:
You have requested an opinion based on the following factual situation:
McPherson County has a group health insurance contract for the benefit of its officers and employees. However, the County Treasurer is not covered under the group policy because he was unable to pass the physical requirements for coverage. The County Treasurer presently has an individual health insurance policy in force.
The question you have presented based on the above factual situation is:
In view of SDCL 7-8-26 and 7-8-26.1 does the Board of County Commissioners have authority to pay up to one-half of the premium on the individual policy of the County Treasurer?
The statutory provisions cited in your question authorize the County Commissioners to enter into group insurance contracts for the protection and benefit of county officers and employees and read as follows:
7-8-26. Hospital and insurance contracts for county officers and employees.- The board of county commissioners shall have power to enter into group hospital and medical insurance contracts for the protection and benefit of its officers and employees, and the immediate families of such officers and employees, and pay not to exceed one-half of the necessary premiums therefor.
7-8-26.1. Life and health insurance contracts for county officers and employees.- The board of county commissioners shall have power to enter into group life and group health insurance contracts for the protection and benefit of its officers and employees, and pay not to exceed one-half of the necessary premiums therefor.
Group health insurance is defined in SDCL 58-18-1 as follows:
58-18-1. Group health insurance defined.-Group health insurance is hereby declared to be that form of health insurance covering groups of persons as defined in §§ 58-18-2 to 58-18-6, inclusive, with or without one or more members of their families or one or more of their dependents, or covering one or more members of the families or one or more dependents of such groups of persons, and issued upon the basis set forth in §§ 58-18-2 to 58-18-7, inclusive.
Based on the plain language of the above statutes it is my opinion that a Board of County Commissioners has no authority to approve payment of a portion of an individual health insurance policy of a county officer or employee. Not only would such a policy of insurance fail to meet the definitional requirements of a "group" contract, but it would also circumvent the statutory authority of the county commissioners to "enter into" group contracts by allowing individual employees to choose an insurance plan.
In a prior opinion of this office regarding a similar situation, 1959-60 AGR 42, it was stated: "The statute imports that the county pay one-half of the premium only when it has actually entered into a group contract with a carrier." I fully concur in the reasoning of that opinion.
I appreciate the practical problems, such as the inability of certain employees to qualify for coverage, which may arise.
However, I refer to 1959-60 AGR 254 wherein it is stated that the commissioners must decide the amount and nature of coverage desired and solicit bids from different companies. A decision should then be made as to which company offers the best plan for the county officers and employees in general and a contract entered into.
The fact that certain employees may not choose or qualify to participate in the group plan does not authorize expenditure of public funds for individual policy premiums.
Therefore, the answer to your question is “NO.”
Respectfully submitted,
William Janklow
Attorney General
WJJ:LLV:dk
