Chapter 16. State-Funded Construction Projects — Employee Health Care Expenses
Regulation .01 Definitions.LinkCopy Citation
A.
In this chapter the following words have the meanings indicated.
B.
Terms Defined.
(1)
“Aggregate employee health care expenses” means all employee health care expenses paid by a responsible bidder or subcontractor.
(2)
Aggregate Social Security Wages.
(a)
“Aggregate Social Security wages” means all wages paid by a responsible bidder or subcontractor to an employee for the period of time in which the wages are paid.
(b)
“Aggregate Social Security wages” does not include wages that are above the federal Social Security contribution and benefit base.
(3)
“Contractor” means a responsible bidder awarded a contract to complete a State-funded construction project.
(4)
“Employee” means an individual who is employed by a responsible bidder, contractor, or subcontractor to work on or at the site of a State-funded construction project.
(5)
“Employee health care expenses” means any costs for health care services that are paid by a responsible bidder or subcontractor to an employee, unless the employee has coverage under another plan, including:
(a)
Contributions made on behalf of an employee to provide credible health care coverage in the form of any group policy, contract, or program that is written or administered by a disability insurer, health care service plan, fraternal benefits society, self-insured employer plan, or any other entity, in this State or elsewhere, that arranges or provides medical, hospital, and surgical coverage not designated to supplement other private or governmental plans;
(b)
Contributions made on behalf of an employee to a health savings account as defined under §223 of the Internal Revenue Code or to any other account having a substantially equivalent purpose or effect without regard to whether the contributions qualify for a tax deduction or are excludable from employee income;
(c)
Reimbursements to an employee for expenses incurred in the purchase of health care services;
(d)
Payments to a third party for the purpose of providing health care services for an employee;
(e)
Payments under a collective bargaining agreement for the purpose of providing health care services for an employee; and
(f)
Costs incurred in the direct delivery of health care services to an employee.
(6)
“Health care services” means medical care, services, or goods that:
(a)
Qualify as a tax-deductible expense under §213 of the Internal Revenue Code; or
(b)
Have a substantially equivalent purpose to medical care, services, or goods that qualify as a tax-deductible expense under §213 of the Internal Revenue Code.
(7)
“Subcontractor” means a person:
(a)
Listed on a responsive bid to provide construction services under a portion of a contract with the State; or
(b)
Added to a contract with the State after the contract is awarded in order to provide construction services under a portion of the contract.
Regulation .02 Payment of Employee Health Care Expenses.LinkCopy Citation
A.
This chapter does not apply to a small business with 30 or fewer employees.
B.
Except as provided in §A of this regulation, bidders, contractors and subcontractors on State-funded construction projects awarded through competitive sealed bidding under COMAR 21.05.02 shall pay employee health care expenses as outlined in §C of this regulation.
C.
A bidder, contractor, or subcontractor is deemed to pay employee health care expenses if it:
(1)
Pays aggregate employee health care expenses of at least 5 percent of the aggregate Social Security wages paid by the bidder, contractor, or subcontractor respectively; or
(2)
Pays 50 percent or more of the required premium necessary to obtain coverage by a credible health care insurance plan.
D.
For bids opened before July 1, 2021, a bidder, contractor, or subcontractor is deemed to pay employee health care expenses if it:
(1)
Pays some portion of employee health care expenses under a contract with a credible health care insurance plan or through a collective bargaining agreement; and
(2)
Will meet the requirements of either §C(1) or (2) of this regulation on renewal of either the contract with a credible health care insurance plan, or the collective bargaining agreement.
Regulation .03 Certification of Payment.LinkCopy Citation
A.
Each bidder, contractor, and subcontractor seeking to perform work on a State-funded construction project shall certify in its bid submission that it pays employee health care expenses by completing and submitting the following certification form:
B.
Addition of New Subcontractors. The certification required pursuant to §A of this regulation shall be submitted prior to the addition of a new subcontractor on existing contracts.
C.
Supporting Documentation. A procurement officer may require a bidder or subcontractor to submit records to the procurement officer that are sufficient to support the bidder or subcontractor’s certification, including a certificate of insurance or a valid contract.
Chapter annotations
Authority: State Finance and Procurement Article, §§17-801 et seq., Annotated Code of Maryland
History: Effective date: May 17, 2021 (48:10 Md. R. 401)