Ala. Code § 36-29-4
The board is hereby empowered and authorized to establish a fully insured or self-insured health insurance plan for employees and retirees of the State of Alabama and to adopt and promulgate rules and regulations for the administration of such plan, subject to such limitations as may be contained in this chapter. Such plan may provide for group hospitalization, surgical, and medical insurance against the financial costs of hospitalization, surgical, and medical treatment and care and may also include, among other things, prescribed drugs, medicines, prosthetic appliances, hospital inpatient and outpatient service benefits, and medical expenses indemnity benefits, including major medical benefits or such other coverage or benefits as may be deemed appropriate and desirable by the board.
Ala. Code § 36-29-4 (1975)