The quarterly newsletter for active and retired OP&F ... · The quarterly newsletter for active and...

The 2014 Annual Change Period (ACP) is just around the corner. Running from Oct. 1-31, the ACP allows current participants in the OP&F health care plans to verify their personal information, apply for the health care discount, and enroll or waive the dental and vision plans.

As in past years, UnitedHealthcare is sponsoring presentations around the state to answer members’ questions about health care options available to them. Each location will hold two sessions, at 10 a.m. and 1 p.m. Listed below are the dates and locations for the 2014 Annual Change Period presentation meetings.

For those unable to attend a presentation in person, there are two teleconferences scheduled for members that include the same information and also offers an opportunity to ask general questions. The teleconferences are scheduled for:

FRIDAY, OCT. 11 - 10 A.M. EST Dial in: (800) 700-7784, use participant code 299621 FRIDAY, OCT. 18 - 1 P.M. EST Dial in: (800) 700-7784, use participant code 299622 When calling, reference Ohio Police & Fire ACP Call

The ACP presentation is posted on the OP&F website at www.op-f.org.

Annual Change Period begins Oct. 1; presentations scheduled for members

The quarterly newsletter for active and retired OP&F members and their survivors | Volume 32, Number 4, Fall 2013

An independent report delivered to the Ohio Retirement Study Council (ORSC) agrees with estimates from the Ohio Police & Fire Pension Fund (OP&F) that the system meets the state’s 30-year funding requirement on a market value basis. ORSC commissioned Pension Trustee Advisors to review policy and operational issues for Ohio’s retirement systems, and specifically OP&F’s actuarial status in the wake of pension reform legislation.

The Pension Trustee Advisors report states that, “…based on investment returns through mid-2013 and a modest return for the last half of 2013 and health care contributions reduced to 2.85 percent of pay, the retirement plan (OP&F) is expected to be fully funded within 30 years…”

The report also suggests additional funding changes to OP&F and other systems in order to build up reserves to better fund retiree health care plans and to protect pension reserves from future economic downturns.

Significant funding provisions were the basis for Senate Bill 340 (passed in September 2012), and included increased member contributions, an increase in the minimum retirement age for new hires and adjustments to the Deferred Retirement Option Plan and cost of

living allowances. OP&F also shifted more dollars toward pensions from its health care funding stream and has seen investment returns in both 2012 and so far in 2013 exceed the assumed rate of return. These factors all contributed to OP&F meeting the state’s funding requirement.

“OP&F, with the help of the Ohio General Assembly, has made great strides in our funding status and we are proud to have reached the required funding level on a market value basis,” said John J. Gallagher, Jr., OP&F Executive Director. “Our members have made sacrifices to achieve this funding level without any additional taxpayer dollars. The provisions of Senate Bill 340 were implemented only a few weeks ago (July 1). We urge our elected officials to let pension reform work as intended before considering any additional changes to our system.”

A market value basis of determining a funding period does not incorporate a smoothing technique. This technique is used by actuaries to lessen the effect of investment returns above or below the assumed rate in a specific year and instead spreads the returns over a period of time.

OP&F members include active and retired police officers and firefighters from Ohio municipalities, their dependents and survivors.

Report to ORSC confirms OP&F is expected to meet 30-year requirement

(continued on pg. 4)

Oct. 8 - ToledoThe Hotel @UTMC (formerly Hilton Toledo)3100 Glendale Avenue Toledo, OH 43614

Oct. 9 - Canton Courtyard by Marriott - Canton 4375 Metro Circle NW Canton, OH 44720

Oct. 10 – Cleveland AreaEmbassy Suites Cleveland -Independence at Rockside5800 Rockside Woods Blvd, Independence, Ohio, 44131

Oct. 15 – Cincinnati Hilton Garden Inn Cincinnati/Blue Ash 5300 Cornell Road Blue Ash, OH 45242

Oct. 16 – Dayton Hilton Garden Inn Dayton/Beavercreek 3520 Pentagon Park Blvd, Beavercreek, OH 45431

Oct. 17 – Columbus Embassy Suites Hotel Columbus 2700 Corporate Exchange Dr Columbus, OH 43231

2 •

OP&F • 140 East Town Street • Columbus, Ohio 43215 • www.op–f.org

MEMBER’S REPORT | FALL 2013OP&F’S quarterly member newsletter

Dear Members,

A year ago we were recognizing the signing of long-sought after pension reform legislation. This year those proposals are now law and OP&F has worked through the implementation of provisions in Senate Bill 340.

From re-printing forms and guidebooks, to re-programming systems and educating members and employers, 2013 has been filled with goals and deadlines designed to comply with the

new law. I am pleased to report that we have had a successful 12 months since Governor Kasich signed the legislation last September.

Of course, our work is not complete. The purpose of the legislation was to preserve OP&F for future generations and to improve our long-term funding outlook. As we have explained in past editions of the Members Report, the state mandates that OP&F’s assets are enough to pay off all obligations within a 30-year period. We firmly believe that the changes included in Senate Bill 340, along with the performance of our investment strategies in 2012 and so far this year, will put us within that 30-year funding period. In fact, a snapshot look at our funding status in February showed that at that time, we were in compliance with the law on a market-value basis.

Our next actuarial valuation – which includes a measurement of our funding period – should show greatly improved numbers compared to previous years. However, since this report only includes data as of Jan. 1, 2013, some important changes will not be credited until the following year. Specifically, investment returns in 2013 are not included, and neither will the shift of some employer contributions from our health care fund toward pension funding (approved by the Board this past May).

So, while the changes in pension reform legislation are having the effect we anticipated, we face the challenge of explaining why we may not be in compliance with the 30-year requirement when the actuarial valuation is presented. As we have emphasized many times, OP&F is designed for the long-term, to provide not only current members with a secure income in retirement, but also future generations of police officers and firefighters. The stroke of the Governor’s pen last September was an important moment for OP&F, but the desired changes take more than a few months for its effects to be realized.

Most importantly, OP&F now has its best fiscal standing in many years and our members should feel confident in the outlook for our system in years to come.

Sincerely,

Message from the Executive Director

OP&F’s investment portfolio value 2013: End of August value: $13.10 billion (est.) End of July value: $13.34 billion End of June value: $12.94 billion

New ID cards for UHC enrollees

All OP&F UnitedHealthcare enrollees will be receiving a new identification card in the mail by Oct. 1. These new cards are being mailed because of a new phone number for all UHC medical and prescription coverage and claim questions, which is: 888-496-3984.

3 •

Prudence • Integrity • Empathy


Ohio Police & Fire Pension Fund, along with UnitedHealthcare has made several changes to the pharmacy benefit plan effective Jan. 1, 2014. These additions will help members enrolled in the prescription drug plan manage the costs of medications, as well as support overall health and wellness.

WHAT TO EXPECT:• Information in the mail: Enrolled members will receive per-

sonalized communication in October and December if they are taking medications that are identified by any of the new pharmacy programs listed below.

• Talk to your Doctor: In order to benefit from these programs, members are required to talk to their physician about the medications that will be affected.

• New ID Card with new phone number: All UHC enrollees will receive a new ID card by October to use for 2014. This card will include a new toll-free customer service number for UHC medical and prescription coverage and claim questions, 888-496-3984.

THESE NEW PHARMACY PROGRAMS ARE EFFECTIVE JAN. 1, 2014:• Notification or Prior Authorization: This requires a doctor to

tell UHC why a member is taking a medication and therefore determine if you will receive benefit coverage. This is based on uses listed in the U.S. Food and Drug Administration (FDA) approved medication labeling and other clinical criteria. – Members should discuss medications with their physicians and ask them to call UHC at the number on the back of your health plan ID card.– Once UHC reviews the information, they will send the member and their doctor a letter stating if the medication is covered under the pharmacy benefit.

• Select Designated Pharmacy Program: This program directs members who are currently taking a select high-cost, tier three medication to choose one of three more cost-effective options.– Fill current prescription through the mail-order pharmacy.– Switch to a lower-cost option and fill at retail pharmacy.– Save the most by doing both!

• Supply limits – Quantity level limit and quantity per dura-tion: A supply limit is the largest quantity of medication covered per copayment or within a time period.– Supply limits help address safety concerns and minimize

waste by setting limits on the amount of medication that can be dispensed for one month or one copayment (i.e. one-month supply for one copayment). These limits are carefully considered by the UnitedHealthcare National Pharmacy and Therapeutics Committee and are based on guidelines included in FDA labeling, dosing recommendations, medical literature and claims data.

New clinical pharmacy programs available in January

4 •



As announced in the last newsletter, OP&F is introducing the new Road to

Health & Wellness program in 2014. As part of this campaign, OP&F and UnitedHealth care are encouraging members and their dependents to obtain an annual exam and recommended preventive care screenings.

By obtaining an annual exam or at least one preventive care screening and submitting the Get Screened Physician Verification Form included in the Annual Change Period packet that members receive in October, the member’s name will be entered into a drawing to receive one of 10 gift cards valued at $100. Members can also qualify for the drawing if they obtain health screenings on-site at one of the Annual Change Period seminars.

Just a few easy steps:• All retirees and dependents enrolled in a health care plan

subsidized by OP&F are eligible to participate. • Please return the completed Get Screened Physician Screen-

ing Form to UHC by Dec. 31, 2013 (one submission per family please).

• Drawing will take place on Feb. 1, 2014.• Winners of the drawing will be notified by mail by

March 1, 2014.

To learn more about preventive care screenings, discuss the topic with a physician or visit uhcpreventivecare.com. This site provides up-to-date guidelines on preventative screenings specific to age and gender.

Take Note for 2014• You will receive your personalized 2014 Annual Change

Period Form and Member’s Guide to Health Care Coverage at the beginning of October to review.

• Return the ACP form with any changes along with required documentation. (i.e. Employer coverage, Medicare or ad-dress change, etc.). Again this year, only return the ACP form if you have changes or updates along with the required documentation.

• Apply for annual 30 percent Health Care Discount Program if you qualify based on your total household income. Include a copy of your signed tax return. If you are not required to file a Federal Income tax return, please complete the affidavit enclosed in your ACP packet.

• Return mandatory Dependent Coverage Application for any dependents between the ages of 18-28 that you wish to con-tinue coverage for in 2014.

• Review new Clinical Pharmacy Programs for 2014. Supply limits, Notification/Prior Authorization and Select Designat-ed Pharmacy. Details are listed on Page 27 of your Mem-ber’s Guide to Health Care Coverage that will come with your ACP packet.

• New ID cards will be mailed for all UHC enrollees. You should receive these cards by Oct. 1. This will list a new customer service number for UHC medical and prescription coverage and claim questions, 888-496-3984. A quick refer-ence phone tree card and new magnet will be enclosed in your ACP packet for your convenience

• Don’t miss out on the “Get Screened” wellness campaign to be entered to win $100. Some screenings will be offered at the ACP meetings in October.

• New discounts for Hearing Aids and Polycarbonate lenses. Monthly contribution rates for UHC medical, prescription drug, dental, and vision will be included in the 2014 Member’s Guide to Health Care Coverage as part of your Annual Change Period packet. Ohio AARP rates for members age 65 and older with Medicare A and B also will be reviewed at the ACP presentations. All rates, including AARP rates, will be shown in each member’s enrollment confirmation letter that is mailed in mid December.

Annual Change Period begins Oct. 1; presentations scheduled for members(continuation from pg. 1)

Road to Health & Wellness @ OP&F

5 •



The 2013 version of the Internal Revenue Service’s (IRS) Form 1099-R will be mailed in January by OP&F to members and beneficiaries who received a benefit payment related to service, disability, annuity, survivor, death, an active member withdrawal or the Deferred Retirement Option Plan (DROP).

The1099-R form will be sent to the address OP&F has on file for members and the form will not be forwarded if the address is not correct. Additionally, OP&F is not able to fax the form to a member, beneficiary or to a third party without notarized authorization.

To ensure that the Form 1099-R is received promptly, contact OP&F if any member information needs updated. OP&F offers several convenient ways to update addresses:

• Online: At www.op-f.org, click on Member Self Serve Web and follow the steps under Register. Once an electronic pro-file is set up, the member demographics can be updated.

• Mail: Send the updated information in writing or on a com-pleted Change of Address form to OP&F at 140 East Town Street, Columbus, OH 43215. The Change of Address form is online at www.op-f.org under Member Information forms.

• Phone: Call 888-864-8363 to update any contact informa-tion over the phone.

• Email: Members may also email address updates to OP&F at [email protected].

If the 1099-R should be mailed to a winter residence, please be sure to file a Change of Address form with the U.S. Post Office 10 postal days before delivery should begin. This will help to ensure that the 1099-R will be received timely.

To change the taxes being withheld from OP&F’s benefit pay-ments, the IRS Form W-4P Withholding Certificate for Pension or Annuity Payments and the Withholding Certificate for Ohio State Income Tax are both available on OP&F’s website. These forms are also available by calling OP&F Customer Service. If a member or beneficiary moves out of state, OP&F does not automatically stop the Ohio state withholding. Members and beneficiaries must submit a request, in writing, to stop Ohio tax withholding from their OP&F benefits.

Also available on OP&F’s website is:• Federal Tax Reporting Information for OP&F

benefit recipients.

• The Private Letter Ruling for on-duty disability retirees.

A few reminders about Form 1099-R:• Health care deductions are not reported on Form 1099-R.

Health care deductions are summarized on the member or beneficiaries’ year-end benefit statement or the last benefit statement they received from OP&F. If the retirement benefit was finalized in 2013, the year-to-date total on the benefit statement started over at zero when the benefit switched from an interim payment to a final payment. The member or beneficiary will need to combine the health care deductions from both accounts to obtain their total health care deduc-tions for the year. There may be other situations that require OP&F to start over from zero, please make sure to account for all months of premium payments.

• Receiving more than one Form 1099-R is not uncommon. Member’s and beneficiaries may receive multiple forms if they receive more than one benefit payment or they turned age 59½ during 2013.

• Non-taxable income is reportable income. Benefit payments may or may not be taxable but they are still reportable to the IRS on Form 1099-R. OP&F recommends that every recipi-ent of Form 1099-R file a Form 1040 tax return with the IRS. OP&F cannot offer tax advice or financial planning services; therefore, please seek professional tax advice before making any decisions. Please contact the IRS directly for informa-tion on filing requirements at 800-829-1040.

• The paper version of the form hides the first five digits of Social Security number to protect personal identifying information.

Benefit recipients should expect IRS forms from OP&F in January

6 •



OP&F offers several valuable programs in which many members are enrolled. To take full advantage of the benefits of these options, specific rules must be followed. In a continuing effort to education members about important deadline requirements, OP&F has developed the following chart.

While most of the items listed pertain to the retiree health care plan, important deadlines are also in place for Deferred Retirement Option Plan (DROP) participants and also for members who receive a disability benefit. If members have questions concerning any of these items, please contact OP&F Customer Service at 888-864-8363, or email [email protected].

Deadlines listed to assist members

ENROLLING IN HEALTH CARE:Benefit recipients

Benefit recipients may enroll in the OP&F-sponsored health care, prescription drug, dental and vision coverage under the following circumstances (enrollment must occur within 60 days of the qualifying event):

• At the time of your OP&F retirement or commencement of OP&F statutory survivor benefits

• Three years after your OP&F retirement anniversary date

• Proof of change in family status (marriage, death, divorce)

• Proof of involuntary loss of group coverage

• At the time a member becomes eligible for Medicare

ENROLLING IN HEALTH CARE:Spouses and dependents

Eligible spouses and dependents may enroll in the OP&F-sponsored health care, prescription drug, dental and vision coverage under the following circumstances (enrollment must occur within 60 days of the qualifying event):

• Proof of change in family status (marriage, death, divorce)

• Proof of involuntary loss of group coverage

• At the time a spouse or dependent becomes eligible for Medicare

ENROLLING IN HEALTH CARE:Adult dependent children

Benefit recipients who want their eligible adult dependent children to continue to be enrolled in the OP&F-sponsored health care, prescription drug, dental or vision coverage must turn in applications each year during the Annual Change Period with a deadline date of Oct. 31. Without this re-enrollment, coverage will be terminated.

• As enrolled dependents turn age 18 and/or 26, a Dependent Child Coverage application must be submitted, since eligibility criteria will change at those ages.

• The Dependent Child Coverage application must be received by the end of the month in which a Dependent turns 18 or 26

APPLYING FOR THE HEALTH CARE DISCOUNT PROGRAM

This program offers a 30 percent health care and prescription drug contribution discount to retirees or survivors who have a total household income equal to or less than 200 percent of the U.S. Department of Health and Human Services poverty level guidelines.

• Applications must be received each year during the Annual Change Period

• Eligible dependents are eligible to apply for the discount at the time they become a survivor

• Benefit recipients are eligible to apply for the discount at the time they become retired

DISABILITY BENEFIT RECIPIENTS:Annual Earnings Statement

Annual Earnings Statements are required by all disability benefit recipients, unless the Board of Trustees grants a waiver. Requests for these statements are mailed by OP&F each July. Failure to submit this statement may result in termination of disability benefits.

• Must be received by Sept. 1 annually

DEFERRED RETIREMENT OPTION PLAN (DROP)Benefit recipients

To realize the benefits of DROP, members must remain in the plan for the minimum number of years, and retire prior to the eight-year anniversary date of their DROP effective date.

• DROP participants must retire prior to the eight-year anniversary date of their DROP effective date. Failure to retire by this date will result in the forfeiture of the member’s DROP accrual

7 •



NCPERS life insurance open enrollment begins Oct. 1The National Conference on Public Employee Retirement Systems (NCPERS) is offering active OP&F police and firefighters the opportunity to enroll in a life insurance protection that was designed specifically for public safety employees.

The NCPERS life insurance Plan has been in existence for over 40 years and is only offered to members of public retirement systems. The Plan currently insures more than 100,000 public employees and their family members.

The Family Protection Plus Plan, underwritten by the Prudential Insurance Company of America, is decreasing term life insurance coverage, which means the monthly premium remains level over time while the benefits decrease with age. This unique design may allow younger members, who have the greatest need and the lowest accrued retirement benefits, to receive the greatest financial protection. The monthly premium is $17 and it includes:

• A basic life insurance benefit of $225,000 to $3,000 depend-ing on age

• An accidental death and dismemberment benefit of $100,000 to $3,000 depending on age

• A spouse life Insurance benefit of $20,000 to $2,000 depending on member’s age

• Children’s life insurance of $4,000 (ages 14 days to year 26)

THE PLAN HAS MANY ATTRACTIVE FEATURES, WHICH INCLUDE:• Guaranteed issue (no medical questions or underwriting)

• Pays in addition to any other group or individual life insur-ance

• 24-hour coverage with no occupational exclusions (except for aviation professionals)

• Includes waiver of premium, in the event member becomes totally disabled.

• Accelerated death benefit

• Conversion privilege

• Coverage can be continued into retirement

Premiums can be paid either through monthly electronic bank withdrawal or direct payment. For more information about this life insurance plan go to www.ncpersfamilyprotection.com. Enrollment is done electronically using a secure website log in. Once you have logged into the secure site, OP&F members will need to identify themselves as a member of Ohio - NCPERS.

The open enrollment period starts on Oct. 1, 2013 and ends Nov. 30, 2013. For questions or problems enrolling online, contact the plan’s administrator, HealthSmart Benefit Solutions, Inc. at 888-697-8897.

&Facts Figures30,000

20,000

21,000

22,000

23,000

24,000

25,000

26,000

27,000

28,000

29,000

2008

28,864 / 24,878

2009

28,062 / 25,317

2010

28,619 / 25,712

2011

28,222 / 26,074

2012

27,623 / 27,078

OP&F MEMBERSHIP2008-2012Active Members

Retirees & Survivors

PRSRT STD US POSTAGE PAID

COLUMBUS, OH PERMIT No. 675

RETURN SERVICE REQUESTED

140 East Town Street Columbus, OH 43215

www.op–f.org

Toll Free: 888–864–8363 General Information: (614) 228–2975 Fax: (614) 628–1777 TTY: (614) 221–3846 E–mail: questions@op–f.org Business Hours: Monday–Friday, 8 a.m.–4:30 p.m. EST

OP&F Board of Trustees David A. Witner, Chair, Cuyahoga Falls Fire William Deighton, Retired, Cleveland Fire Scott Huff, Cleveland Police Ed Montgomery, Columbus Division of Police Lawrence Petrick, Shaker Heights Fire John Wainscott, Retired, Cincinnati Police J. David Heller, Investment Member David Owsiany, Investment Member Scott D. Roulston, Investment Member

OP&F Executive Staff John J. Gallagher, Jr. Executive Director J. Keith Byrd, Deputy Executive Director Mary Beth Foley, General Counsel Theodore Hall, Chief Investment Officer Scott Miller, Director of Financial Services Jennifer Harville, Member Services Director Mark Jordan, Internal Auditor


Securing the future for Ohio’s Police and Firefighters

COPYRIGHT © 2013 by Ohio Police & Fire Pension Fund, All Rights Reserved.

BUG

Notify OP&F of any address changesWhether you are an active or retired member, or a survivor, it is important to keep your address, phone number and e-mail address current with OP&F. Members can update their information online via the secure Member Self Serve Web, or a form and instructions may be downloaded from the Forms section of www.op–f.org, and returned to OP&F by mail, fax or call Customer Service at 888-864-8363.

Important Dates:Sept. 24-25Board of Trustees meetings

Oct. 22-23 Board of Trustees meetings

Nov. 11 OP&F closed in observance of Veterans Day

Nov. 19-20 Board of Trustees meetings

Dec. 17-18 Board of Trustees meetings

Dec. 24-25 OP&F closed in observance of Christmas

Jan. 1 OP&F closed in observance of New Years

The quarterly newsletter for active and retired OP&F ... · The quarterly newsletter for active and...

Documents

Transcript of The quarterly newsletter for active and retired OP&F ... · The quarterly newsletter for active and...