Section 11C. Upon acceptance of this chapter as provided in section ten, the appropriate public authority of the governmental unit shall negotiate with and purchase on such terms as it deems to be in the best interest of the governmental unit and its active and retired employees and their dependents insured or eligible to be insured under this chapter including the surviving spouse of said employees, who are eligible for coverage under the federal health insurance for the aged act, from one or more insurance companies or nonprofit hospital, medical or other service corporations, a policy or policies of group general or blanket insurance providing hospital, surgical, medical, dental and other health insurance, to be known as optional medicare extension. Said policy or policies shall consist of one or more schedules of benefits which, as determined by the appropriate public authority, may be related to the schedule of benefits purchased under the provisions of sections three and five. Such schedule of benefits may include on behalf of any person insured under this section the payment of any premium which may be required by the federal health insurance for the aged act, to be paid by any enrollee thereof. The claim experience of persons insured for optional medicare extension may, as determined by the appropriate public authority, be maintained apart from, or made a part of, the claim experience applicable to the schedules of benefits provided under sections three and five.

The appropriate public authority, after receiving the recommendations if any from the advisory committee as provided in section three, shall execute all agreements or contracts pertaining to said policy or policies or any amendment thereto for a period, not exceeding five years, as it may deem the most advantageous to the governmental unit; provided, however, that the portion of the cost of the premium to be borne by the governmental unit shall not exceed the estimated monthly cost for which funds have been appropriated for the then current fiscal year.

Every policy whether original or renewal shall, in the case of all persons insured under this section who immediately prior to the effective date of such original or new policy were covered by group insurance benefits under this chapter, provide protection by continuing uninterrupted coverage without regard to waiting periods for benefits.

(a) Each person or his dependent to which this section applies shall furnish the treasurer of the governmental unit or the appropriate retirement authority in such form as he or they may prescribe, such information as is necessary to be insured for optional medicare extension, and shall authorize the withholding of the appropriate premium from salary, wages, other compensation, pension, annuity or retirement allowance. Each person may also authorize the withholding of any premium which may be required by the federal health insurance for the aged act, to be paid by any enrollee thereof, or to make direct payment to the treasurer as he may determine, and he shall transmit all such amounts to the appropriate federal agency on behalf of such enrollee in a manner prescribed by said agency.

(b) With respect to any period of insurance authorized by this section which is in effect for an active employee or a retired employee and his dependent, payment for such insurance shall be made as provided in section seven.

(c) Upon the death of an active or retired employee insured under this section, the surviving spouse may continue the insurance under this section, or the group hospital, surgical, medical, dental and other health insurance benefits provided under section three, whichever may be applicable, and the duration of such insurance, the determination and the amount of premium to be paid will be in accordance with section nine B.

(d) If it is determined by the appropriate public authority to be in the best interests of the governmental unit and its active and retired employees and dependents eligible for optional medicare extension under this section that the optional medicare extension program administered by the commission under section ten C of chapter thirty-two A would be less costly to the governmental unit and the employees as well as being administratively advantageous to the governmental unit, the appropriate public authority may make application to the commission in accordance with the procedure the commission may establish and upon approval by the commission the employees of the governmental unit shall become so insured.

(e) The medicare extension coverage permitted by this section shall be mandatory, rather than optional, for any governmental unit that accepts section eighteen.