TCCTA Blog

ERS Summer Enrollment Approaches

Active community and technical college employees will have the opportunity to enroll in new benefit programs or change their current coverage during ERS Summer Enrollment (SE), which will run from July 11 to August 12. Each agency and higher education institution will be assigned to a two-week SE phase during which employees can make enrollment changes. The agency is working on this year’s phase list and will post that list as soon as possible.

• To make changes to your benefits, sign in to your ERS account. Changes made during SE will go into effect on September 1, 2016. If you don't want to make changes to your benefits, you do not need to do anything. Your current coverage will continue. 

  You can make changes during the plan year if you have a qualifying life event.

  If you are Medicare eligible, you have a different enrollment period. Please visit the Retiree Fall Enrollment page for more information.

• Resources

  2016 Summer Enrollment Guide for Employees

  2016 Summer Enrollment Guide for Retirees

  Check your agency or institution’s phase

  Consumer Directed HealthSelect Summer Enrollment Insert

  Dental Options Comparison (PY17)

  Employee Health Plan Comparison (PY17)

  Vision Comparison Chart 

  Rates

  Plan Year 2016 Rates

  Plan Year 2016 Retiree Rates

  Plan Year 2017 Rates

 

Social Security Bill Advances

HR 711, known as the the Equal Treatment of Public Servants Act, now has 100 cosponsors, with 27 cosponsors from Texas, according to the Texas Retired Teachers Association. The bill is authored by Rep. Kevin Brady (R-Conroe). 

Here is important background information on Social Security and community colleges. The link also includes contact details for U.S. lawmakers. 

The measure would essentially replace the Windfall Elimination Provision of the Social Security law, which presently reduces benefits for public employees who retire from schools that do not participate in the Social Security System, but would otherwise qualify based on previous or supplemental employment with participation in the system. 

The WEP, which took effect in 1983, provides a means of eliminating the “windfall” of Social Security benefits received by beneficiaries who also receive a pension based on work not covered by Social Security. 

On average, the WEP reduces monthly incomes of former public employees by $400. HR 711 proposes to reduce the WEP’s impact on current retirees by 33 percent or more. Future retirees will see the WEP’s impact reduced as much as 50 percent, according to TRTA. 

HR 711, if passed, would guarantee public servants receive the benefits they earned while they paid into Social Security. HR 711 would also increase lifetime Social Security benefits by $20,000 to $32,400.

ERS Provides Details on New Vision Plan

The following is a message from ERS regarding the new vision plan offered by the agency for active employees.

Summer enrollment is approaching and you can visit this site for more information. 

Announcing State of Texas Vision

In response to your overwhelming interest, ERS announces a new vision plan, called State of Texas Vision that you can enroll in during Summer Enrollment with coverage starting on September 1, 2016.

On May 17, the ERS Board of Trustees approved Superior Vision Services, Inc. to administer the new vision plan available to all employees, retirees and their eligible dependents. 

What will the new plan include?

The State of Texas Vision plan includes access to the Superior Nationalprovider network. Below are the annual plan benefits when using a network provider:

Annual Benefit	In-Network Co-Pay
Routine eye exam, including dilation	$25
Contact lens fitting, standard	$25
Single vision lens	$10
Bi-focal lens	$15
Tri-focal lens	$20
Progressive lens	$70
Frames	Up to $150 allowance
Contact lens (in lieu of frames/glasses)	Up to $150 allowance

Frequencies for all State of Texas Vision plan benefits are once a year.

Participants can either use the vision discounts offered as value-added benefits or the new vision plan, but not both.

Note: If you visit a network provider for both a routine eye exam and a contact lens exam, you will pay each copay amounts, for a total of $50.

Is your eye doctor in network?

Visit superiorvision.com and under “Locate a Provider,” select the “Superior National” network along with your city or zip code. You can narrow your search to provider name and radius under “Advanced search."

If your provider is not listed in the Superior National network, contact Superior Vision Services, Inc toll-free at (877) 396-4128 to nominate a provider to join the network.

How much does it cost?

Monthly rates effective September 1, 2016 - August 31, 2017:

You only	$6.69
You and spouse	$13.38
You and children	$14.38
You and family	$21.07
Spouse only	$6.69
Spouse and Children	$7.69
Children only	$14.38

 

How to enroll? 

Employees may enroll during Summer Enrollment for coverage beginning September 1, 2016. Enrollment in the State of Texas Vision Plan is optional. Beginning in September, you can also enroll:

• Within 31 days of becoming a new hire or rehire; or
• Within 31 days of having a qualifying life event (QLE).  

Medicare-eligible retirees can elect vision if they have a valid qualifying life event or during Fall Enrollment.

Resources

ERS will be communicating extensively about the new plan before and during Summer Enrollment to help you decide if this vision plan is a good option for you and your family. In addition, a Superior Vision Services, Inc. representative will be available at all Summer Enrollment fairs to answer your questions about the plan. Additional information will be posted on the State of Texas Vision website as it becomes available.

Contact Superior Vision Services, Inc toll-free at (877) 396-4128 with any questions.

 

ERS Health Rates Set to Rise

The trustees of the Employees Retirement System of Texas met recently and made a number of important decisions, with each listed below. 

Premiums for health and dental insurance to increase September 1, 2016 Of chief interest to community and technical college educators is the action on rates for health and dental plans. The rates depend upon a number of factors such as the level of support from each college, dependent coverage, non-smoking discounts, etc. Your school's HR department will be informed of your institutional rates.  Find the Plan Year 2017 rates here. This includes monthly premium rates for all types of insurance, as well as the state's health savings account (HSA) contributions for the new Consumer Directed HealthSelect plan. Rates for HumanaDental DHMO, State of Texas Dental Discount Plan, Optional Term Life Insurance, Dependent Term Life Insurance, Voluntary Accidental Death & Dismemberment (AD&D), and short-term and long-term disability insurance will remain the same in Plan Year 2017. Health premiums for Medicare-eligible retirees and their dependents will be evaluated prior to the August ERS Board of Trustees meeting and if they change, they will go into effect January 1, 2017.   Service purchase and flexible spending account rule changes The ERS Board of Trustees adopted the following rule changes: Allow a non-contributing ERS member to purchase waiting period service credit. Allow participation in a limited flexible spending account for Consumer Directed HealthSelect participants to use on qualified vision and dental expenses.   New pharmacy benefits manager for HealthSelect of Texas Prescription Drug Program and HealthSelect Medicare Rx Beginning January 1, 2017, UnitedHealthcare will administer prescription drug services for participants of HealthSelect of Texas, the new Consumer Directed HealthSelect, HealthSelect Medicare Advantage and KelseyCare Advantage HMO. UnitedHealthcare offered significant costs savings, while maintaining the same level of benefits, compared to the other pharmacy benefits managers that met the contract’s qualifications. It’s important to note that the formularies for the plans – what specific drugs are covered at what costs – could change under the new administrator. This fall, ERS will provide more information on the transition of your existing prescription benefits to UnitedHealthcare. The health maintenance organization (HMO) pharmacy benefits managers will stay the same.   Introducing State of Texas Vision The ERS Board of Trustees named Superior Vision Services, Inc. as the third-party administrator of the new State of Texas Vision plan available to all employees, retirees and their eligible dependents beginning September 1, 2016. The contract for Superior Vision Services, Inc. runs through August 31, 2020. State of Texas Vision will be a self-funded plan, paid for entirely by plan participants. The ERS Board of Trustees also approved rates for Plan Year 2017. Employees and retirees who are not eligible for Medicare will receive more information on the new plan during the upcoming Summer Enrollment. Medicare-eligible retirees and their dependents can enroll during Fall Enrollment, which will be held in November 2016, or starting September 1, 2016 if they have a valid qualifying life event (QLE). Find more information about the plan on the vision benefits page and in the ERS newsletters.   Here is a link from ERS for more information.

 

Details on Health Plan Now Available

The new consumer-directed health plan (CDHP) from ERS, which includes a high-deductible health plan (HDHP) and a health savings account (HSA), has a new name: Consumer Directed HealthSelect. ERS is also now providing details on how the plan will work. 

Employees and retirees not eligible for Medicare have the option to enroll in the plan during Summer Enrollment and coverage will start on September 1, 2016. No one is required to enroll in the new plan, but it could be financially beneficial for some individuals. This is a decision that should be considered carefully. 

You can stay in your current plan if you want and are not required to enroll in Consumer Directed HealthSelect.

Consumer Directed HealthSelect includes two components: an HDHP and an HSA. Here is a link for more information.  

Social Security Update

The U.S. House Ways and Means Committee will convene Tuesday, March 22, to consider HR 711, a bill that would repeal the Windfall Elimination Provision of the Social Security statute. The law presently reduces benefits for many individuals who are otherwise qualified for Social Security due to previous or supplemental employment.

Employees of Texas community colleges planning to retire from schools that do not participate in the Social Security system are potentially affected by the WEP. The committee hearing will not address the Government Pension Offset, which affects spouses. Here is background information on the two provisions. 

HR 711’s author, Rep. Kevin Brady (R-Conroe), is the chair of the committee conducting the hearing. This could be significant, but some commentators remain skeptical about the chance of passage in the House and Senate. 

If enacted, the bill would insure that public employees receive the benefits earned while they paid into Social Security. HR 711 would also increase lifetime benefits, according to the Texas Retired Teachers Association. You can read the full text of the bill here.

You can also watch the meeting on the Ways and Means Committee’s website. The hearing starts March 22 at 9AM CDT.

Here is a link to find out "Who Represents Me?"

ERS Offers Information on New Plan

The trustees of the Employees Retirement System of Texas recently received recommendations from staffers on a new option that will be available to covered employees and retirees who aren’t eligible for Medicare. You don’t have to switch health plans, but during the upcoming Summer Enrollment period, you can select this new health coverage option, to start September 1, 2016.

The plan combines a high-deductible health plan (HDHP) design with a health savings account (HSA). Making the switch may be financially advantageous for some individuals, but should be considered very carefully. The key feature of an HDHP is in its name: the high deductible. Participants will have to pay an annual deductible before the plan will pay most medical and prescription benefits, with the exception of preventive services.

UnitedHealthcare will also administer the HSA, which is like a nest egg for health care expenses. An HSA allows participants to use pre-tax funds for eligible health care expenses. UnitedHealthcare doesn’t approve or deny reimbursements but participants must ensure their payments are made on eligible expenses. Participants enjoy tax-free interest earnings and, in some cases, can decide how to invest their funds. Unlike a health care flexible spending account, all unused funds will roll over to the next year.

Here is a link for more details. 

ERS to Launch New Health Plan Option

The 2015 Regular Session of the  Texas Legislature charged ERS with providing an alternative health insurance option to HealthSelect of Texas and the regional HMOs. Specifically, they directed ERS to create a consumer-directed health plan (CDHP) that includes a high-deductible health plan coupled with a health savings account.

Health savings accounts, according to the U.S. Treasury Department, were created in 2003 so that individuals covered by high-deductible health plans could receive tax-preferred treatment of money saved for medical expenses. Generally, an adult who is covered by a high-deductible health plan (and has no other first-dollar coverage) may establish an HSA.

The new ERS plan will be available to members not eligible for Medicare. You don’t have to switch health plans, but during the upcoming Summer Enrollment period, you can select this new health coverage option to start September 1, 2016.

IMPORTANT: This is an option that should be considered very carefully before changing from your current plan with ERS. Some individuals may see certain financial advantages in the new plan. You should also confer with your school's human resources personnel, as institutions vary in their level of premium rates for employees and dependents. 

Here is a link from ERS for more information. Note especially the section on how it works. 

TRS Downgrades Fund Evaluation

The Teacher Retirement System of Texas released its annual valuation recently. The fund, the nation’s sixth largest, presently has $128.5 billion held in trust, for over 350,000 Texas public education retirees and 1,000,000 pre-retirees. This figure is down from $132.7 billion in August 2014. Additionally, TRS reported that the fund earned a return of -0.3% for FY 2015. Here is the TRS website. 

Here are more specifics, as reported by the Texas Retired Teachers Association:

The period of time to amortize the fund’s unfunded liabilities has grown from 29.8 years in 2013 to 33.3 years. This means that at this moment in time, the pension fund is not actuarially sound by state law. In order to meet this threshold, the fund must be able to pay off all unfunded liabilities within a 31-year time period.

Most observers believe that two key factors are in operation affecting long term projections. First, the investment portfolio of the fund is not performing as robustly as before. Second, the report necessitated the adoption of a new mortality assumption, reflecting increased life expectancy of all TRS members, including current active school personnel. 

In practical terms the fund is still in very good shape but cannot, under present law, permit new benefits enhancements to current or prospective retirees. 

A national movement remains active to gradually eliminate "defined benefits" pensions and replace them with "defined contributions" plans (such as ORP). In Texas these efforts have met with little success in previous Regular Sessions, perhaps due to the massive combined membership of active and retired individuals in TRS.

Such pension plans rely upon younger participants to supply a secure income for present retirees. 

Here are more pertinent details from TRTA:

The figures provided assume that the state will continue to provide the level of funding to the system as established with the passage of Senate Bill 1458 in 2013 during the 83rd Legislative Session. That means TRS expects the state contribution rate to be 6.8% of active educator payroll, the school district rate to be 1.5%, and the active employee rate to be 7.7%. TRS also assumes an overall annual investment return of 8%.

ORP and TRS Update

The Coordinating Board has updated its information on the two retirement plans available to community and technical college educators, the Teacher Retirement System and the Optional Retirement Program. New employees should pay particular attention. Here is the link.

Please read the overview (provided by your institution and also at the site above) as soon as possible. For new hires, it contains information you need to know before your 90-day ORP election period expires. Your institution will provide you with a list of authorized ORP companies, local policies and procedures for electing ORP, and your employer contribution rate.

The site contains only general information about ORP and TRS. Please contact your institution's human resources office for specific information about the ORP plan at your school.

The ORP is a defined contribution plan that is available as an alternative to TRS for full-time faculty, librarians, and certain administrators and professionals employed by Texas public institutions of higher education. ORP-eligible employees have 90 days from their first day of employment in an ORP-eligible position to make a one-time irrevocable election of ORP in lieu of TRS.