A State may extend coverage to designated absolute coverage groups of the State or
a political subdivision. It may provide coverage for the governmental function as
a group and for each proprietary function as separate coverage groups. When coverage
is extended to these designated groups, the State must specifically identify each
group as a designated absolute coverage group and furnish the effective date of coverage
and any optional exclusion for each group. Where a State has provided coverage to
designated absolute coverage groups, the State may, by modifying its agreement, extend
that coverage to any absolute coverage group in the State. If the State extends coverage
to selected absolute coverage groups and subsequently decides to cover any of the
remaining absolute coverage groups of the same entity, (e.g., newly created functions
or preexisting non-covered functions), each remaining absolute coverage group must
be included under the agreement as a separate coverage group.
It is possible for a State that provided coverage for designated coverage groups of
an entity to later extend coverage to all its absolute coverage groups. In this way,
the State provides automatic coverage for the non-covered current employees as well
as for the future employees of the entity. To do this, the State is required to make
the coverage uniform for all of the groups involved, i.e., coverage for all the groups
must be made consistent with the broadest coverage of any of the groups. This "conversion"
from the coverage of designated coverage groups to the coverage of all the absolute
coverage groups is accomplished by an appropriate modification to the State's agreement.