Amends GS 135­48.44(a)(6) to end healthcare coverage for state employees as a result of a false statement or false representation of a material fact regarding eligibility or enrollment information, in addition to the previously specified false statements on the last day of the month.

Amends GS 135­48.40(c)(2) to clarify that individual retirees shall only pay the balance of the total premiums not paid by the State when not prohibited by law, and that the total premium is the sum of the Plan's total employer premium contribution rate plus the employee's or retiree's contribution for individual and dependent coverage.

Amends GS 135­48.42(a) to automatically cover children born to covered employees at the time of birth so long as the Plan receives notification within 30 days of the date of birth and the employee pays any additional premium required by the coverage type selected retroactive to the first day of the month in which the child was born (currently allows covered employees to switch from the coverage outlined in GS 135­48.43(d), type (1), to type (2) or (3) upon the birth of a child). Effective October 1, 2017, and applies to children born to covered employees on or after that date.

Amends GS 135­48.5(a) to change the order of use for unencumbered balances in excess of prepaid premiums or charges in the Public Employee Health Benefit Fund. The unencumbered balance is first used to provide an actuarially determined Health Benefit Reserve Fund for incurred but unpresented claims; secondly, up to 50% of any remaining unencumbered balance may be set aside by the State Treasurer, subject to approval by the Board of Trustees of the State Health Plan for Teachers and State Employees (Board of Trustees), to reduce the State's unfunded actuarial accrued liability for post­employment retiree health benefits; thirdly, to reduce premiums required in providing the benefits of the health benefits programs; and fourthly, to improve the plan as may be provided by the State Treasurer, subject to approval by the Board of Trustees.

Makes conforming changes to GS 135­48.22 (Board Powers and Duties) and GS 135­48.30(a) (Powers and Duties of the State Treasurer)

Enacts new GS 135­48.20(n), protecting persons serving on the Board of Trustees from civil liability for monetary damages for any act, or failure to act, arising from that service, except where the person was not acting within the scope of their official duties, was not acting in good faith, committed gross negligence or willful or wanton misconduct resulting in damages or injury, derived an improper personal financial benefit from the transaction, or incurred the liability from the operation of a motor vehicle.