Committee recommends steps to simplify Medical Plan
After completing a two-year review of the Medical Plan, the Healthcare Committee has recommended, and the directors have approved, a number of modifications to the Medical Plan at the June 27 meeting of the Board of Directors in Philadelphia.
Generally, the modifications simplify a very complex Plan, but without sacrificing its fundamental tenets. The Medical Plan is designed to support the unique characteristics of PC(USA) ministers and church workers, expressed in the defining principles of community nature and call neutrality.
Together, the changes better integrate different parts of the Plan, simplify some of its provisions, offer greater flexibility to members, ensure compliance with current regulations, and address an overture to the 218th General Assembly (2008). Some of the changes remove confusing deductibles and certain maximums, making the Plan easier to understand.
All but one of the changes are effective January 1, 2010; a dependent coverage waiver option takes effect October 1, 2009.
The modifications to the Medical Plan are happening against the backdrop of potential healthcare reform. Plan members should be assured that the Board of Pensions is closely monitoring relevant legislative initiatives.
“The recommended modifications will make the Medical Plan more integrated, understandable, and equitable,” said Pat Haines, senior vice president of Benefits for the Board of Pensions. “It’s important for churches, employing organizations, and Plan members to know that there’s a lot of good news to be found in these changes.”
The approved amendments to the Medical Plan, detailed below, will be reported to the 219th General Assembly (2010).
2010 medical dues
Despite rising healthcare costs, Medical Plan reserves are stable, and dues reflect generally favorable medical claims experience over the past year.
Traditional Program
For the third consecutive year, the dues percentage for active coverage under the Medical Plan’s Traditional Program will remain unchanged for 2010. Generally favorable experience and Plan reserves allowed the directors to hold the line on Traditional Program dues — currently 19.5% of effective salary.
Although there will be no increase in the dues percentage for 2010 for Traditional Program participants, actual dues invoiced are based on the medical participation basis, which will increase to reflect the change in the ordained median salary for 2010. Thus, individual invoices may increase slightly.
Affiliated Benefits Program
The medical claims experience of the Affiliated Benefits Program (ABP) necessitates only a slight dues increase effective January 1, 2010. The directors of the Board of Pensions voted to increase by 2.5% the monthly subscription dues of active ABP participants and ABP early retirees. This increase does not apply to Medicare Supplement subscribers, whose dues are decided at the October Board meeting each year.
Under the Affiliated Benefits Program, churches and other employing organizations may offer medical coverage only — or medical with death and disability coverage — to employees in non-installed positions scheduled to work 20 hours a week or more. There is no Pension Plan offering with this program. Participating churches and other employing organizations may choose to offer optional programs, including the Retirement Savings Plan, a 403(b)(9) plan. Employees covered under the Affiliated Benefits Program may be required to make a contribution for their coverage. Under the Traditional Program of the Benefits Plan, coverage is non-contributory.
Seminary students
The dues percentage for seminary students will remain unchanged for 2010. Actual dues invoiced are based on the minimum participation basis, which will increase to reflect the change in the ordained median salary for 2010. Thus, individual invoices will increase slightly.
Application for Part D subsidy
The Board of Pensions will apply to continue its participation in the Medicare Part D subsidy program for 2010. The effect of the subsidy will be reflected in the Medicare Supplement dues determined for 2010 at the October 2009 Board meeting.
Medical Plan design changes authorized
Both to simplify Medical Plan design and respond to specific legislative changes and General Assembly direction, the directors approved a number of modifications to the Medical Plan at their June 27 meeting. Watch Pensions.org and your mail and email for more information about these changes over the coming months.
Out-of-pocket costs and deductibles restructured
Congress extended and expanded the mental health parity law so that the benefits provided through the Medical Plan for mental health and substance abuse services cannot be subject to financial or benefit limits that are more restrictive than those imposed for medical services.
The desire to achieve parity and to better integrate, simplify, and control costs in the Medical Plan (including the Prescription Drug Program) has prompted the following changes to out-of-pocket costs and deductibles (see charts). Note that the restructured costs encourage use of in-network service providers and generic drugs. By using in-network providers and generic drugs whenever possible, members can save themselves, and the Plan, money.
Modifications to Active Medical Plan and Medicare Supplement Program
Modifications to Prescription Drug Program for Active Medical Plan and Medicare Supplement Program
Dependent coverage waiver option added
From time to time, members have requested waivers from the Medical Plan’s automatic coverage of eligible spouses and dependent children. To give members greater choice in their medical coverage options, the directors approved a dependent coverage waiver option, effective October 1, 2009.
The new provision allows active members to waive coverage for their eligible spouses and/or dependent children if they have comparable medical coverage under other employer or military services-related group healthcare plans. The Board will determine whether the other medical coverage is comparable based on criteria outlined in new Administrative Rule 206.
The granting of this waiver will not affect dues. In keeping with the community nature of the Benefits Plan, a church or employing organization’s dues will not be reduced for any member who receives a dependent coverage waiver.
New health management service provider selected
The Board has contracted with ActiveHealth Management for the provision of health and care management services, effective January 1, 2010, when its contract with CareAllies will expire. ActiveHealth Management will provide a full spectrum of health management services for Benefits Plan members, from pre-certification to case management to disease management.
The Board believes this provider can make a real difference in Plan members’ lives. By electronically integrating each member’s diverse clinical information into a personal health record and assigning a single nurse to work with the member (and his or her family) over time, ActiveHealth Management will be able to identify, and appropriately follow up on, any possible gaps in the quality of members’ medical care. This information will be treated confidentially.
With data-driven technology at its core, ActiveHealth Management not only can make appropriate targeted interventions and support members’ efforts to improve their self care, but it also offers rich analytic and reporting tools. These tools will enable the Board to better evaluate future program initiatives and benefit design opportunities.
Watch Pensions.org and your mail and email for announcements about ActiveHealth Management in the months ahead.
New coverage approved for children with congenital developmental disabilities
“Habilitative” services for children with congenital developmental disabilities such as Down syndrome and autism will now be covered under the Benefits Plan, effective January 1, 2010.
The directors’ decision to expand the definition of “medical necessity” in the Benefits Plan in this way follows on the work of a task force of experts. In response to an overture by the 218th General Assembly (2008), a task force of Board of Pensions staff, industry representatives, and parent advocates of children with developmental disabilities conducted research, developed guidelines, and proposed the amendment that the directors approved.
The new coverage provides certain expanded therapeutic benefits to children with specified developmental disabilities. More information will be available in the coming months.
Medical Plan maximum benefit increased
The directors approved an increase in the maximum benefit payable under the Medical Plan, effective January 1, 2010. The increase, from $3 million to $3.5 million, reflects changes in the Consumer Price Index since the last increase.
Optional Dental Program
The Healthcare Committee authorized the Board to review the design of the Dental PPO (Preferred Provider Organization)/Indemnity Program and to propose potential enhancements for 2010. Final terms of the program and the 2010 dues will be presented at the October Board meeting.
Watch for more information in the Fall 2009 issue of The Board Bulletin.
Renewal of contracts approved
Contracts will be renewed for 2010 with the following third-party providers:
- Highmark Blue Cross Blue Shield
- Anthem Blue Cross of Kentucky
- Triple-S
- CIGNA International Expatriate Benefits
The Anthem contract was renewed with previously approved benefit modifications, most of which were implemented in 2009. (See The Board Bulletin, Summer 2008.) One change was deferred until next year: effective January 1, 2010, the annual deductible for Anthem Plan members will be $250 per individual and $750 per family.
Board of Pensions Balanced Investment Portfolio returns 6.4% for the five months ended May 31, 2009
Thomas Parks Jennings, chair of the Investment Committee, reported that the Board of Pensions Balanced Investment Portfolio had a market value of $5.6 billion on May 31, 2009, with a return of 6.4% for the five months ended May 31, 2009. He noted that while the economy remains fragile, the committee was cautiously optimistic that global markets have stabilized and the U.S. banking system has survived the dire events of 2008, all of which should lead to economic improvement in 2010. The committee was pleased to report not only positive investment performance but also the fully funded status of the Pension Plan.
Mr. Jennings noted that the Investment Committee reviewed the investment performance and asset allocation of the Board of Pensions Balanced Investment Portfolio. The Committee affirmed the current asset allocation of 37.1% in U.S. stocks, 18.4% in international stocks, 35.3% in fixed income, and 9.2% in other assets.
The Balanced Investment Portfolio is the investment fund for the Pension Plan, Death and Disability Plan, Endowment Fund, and the Assistance Program, as well as for restricted gifts made to the Board of Pensions.
Retirement Savings Plan minimum required distributions amended
The directors approved an amendment to the Retirement Savings Plan of the Presbyterian Church (U.S.A.) (RSP) to allow the temporary suspension of forced distributions for the 2009 plan year. This responds to an IRS waiver of minimum required distributions (MRDs) from certain retirement accounts for this year.
Written last fall when the financial markets were in a severe downturn, the waiver is intended to avoid forcing participants age 70½ or older to sell investments at significant losses.
If the waiver is extended by federal law into 2010 and beyond, the temporary suspension of forced distributions from the RSP will automatically be extended
as well.
The amendment will be reported to the 219th General Assembly (2010).
Several "housekeeping" changes made to Retirement Savings Plan
Several other amendments to the Retirement Savings Plan (RSP) were approved at the June 27 meeting of the directors; three pertain to rollovers. Relatively few participants are affected by these changes.
First, in order to allow participants the flexibility to consolidate their retirement savings, the RSP was amended to allow participants to roll over lump sum distributions from either a defined benefit pension plan or a defined contribution plan. Previously, participants could only roll over lump sum distributions from a defined contribution plan.
Second, the RSP cannot support Roth contributions or rollovers from Roth IRAs. The RSP was amended to reflect that fact.
Third, the Benefits Plan was amended to include the eligible rollover distribution rules, as required by the Internal Revenue Code. These rules apply only to mandatory cash-outs, voluntary cash-outs, small pension settlements, and survivor’s small pension settlements. The Plan already operates in accordance with these rules.
Finally, a separate amendment was made to the Benefits Plan and to the Retirement Savings Plan regarding lost payees. The forfeiture period was changed from six years to two years.
The forfeiture period is the time between when a beneficiary who is entitled to a benefit cannot be located and when that benefit is actually forfeited. This change simplifies the administrative process for lost payees.
These amendments will be reported to the 219th General Assembly (2010).
Discerning God’s call at Presbyterian CREDO
“The CREDO experience can change lives,” says Mary Serovy, director of Presbyterian CREDO, which is why the Assistance Program of the Board of Pensions will sponsor another six conferences in 2010.
Time and again, conference participants write heartfelt notes of thanks, commenting on the profound effect CREDO has had on them. “I have new hope and zeal for this denomination,” wrote one pastor immediately upon his return home. “Knowing that the larger church cares about my wholeness as a person and a minister is empowering; it give me permission to be intentional about my wholeness too,” explained another. Added yet another: “I have reclaimed my life as a beloved child of God.”
Next year for the first time, one of the CREDO conferences is scheduled to be held at a Presbyterian conference center, the Heartland Presbyterian Center, near Kansas City, MO.
The overarching purpose of Presbyterian CREDO is to promote the holistic health and welfare of our clergy serving congregations. Participants work on personal and professional renewal, concentrating on four major components of well-being: spiritual, vocational, financial, and health. Although much is shared about Board of Pensions programs and benefits, the eight-day conference primarily offers participants the opportunity to go deeply into themselves and listen for God’s call.
In mid-July, invitations will be sent to approximately 850 pastors randomly selected from the database of Benefits Plan members. The program guidelines seek pastors between the ages of 40 and 55 who are serving congregations and who have at least seven years of service to the church.
For additional information, visit www.presbyteriancredo.org.
Middle Governing Body Grant applications invited
Applications for Middle Governing Body Grants for the year 2010 may be submitted to the Assistance Program of the Board of Pensions through August 15, 2009. Ten matching grants in amounts of up to $15,000 are available.
The Assistance Program offers Middle Governing Body Grants to synods or groups of presbyteries that want to develop new programs to improve practical skills in their pastors. Proposed programs may provide training in congregational and staff leadership, budgeting and financial management, strategic planning, or conflict resolution.
Recipients of the 2010 grants will be notified on or about November 15, 2009.
In Memoriam
As The Board Bulletin was going to press, we learned the sad news of the sudden death of Bill Forbes after a long and Spirit-filled battle with pancreatic cancer. Bill served the Board of Pensions as vice president of Church Relations and corporate secretary from 2003 until his death on June 30, 2009.
A beloved minister of the Word and Sacrament, Bill formerly served congregations in Princeton, Atlanta, and Houston, and on the General Assembly staffs of the former United Presbyterian Church (U.S.A.) and the Presbyterian Church in the U.S. His profound love for the Presbyterian Church and all its members was evident in his joyful and faithful ministry - from the congregations he served to his national church service. We, and the entire Church, mourn his loss and give thanks for his life.
2009 RBCs promote information exchange, reflection
This year’s Regional Benefits Consultations (RBCs) were held in Tampa, FL; Kansas City, MO; and San Francisco, CA.
Sponsored by the Board of Pensions and held each spring, the Regional Benefits Consultations bring together representatives from the presbyteries and synods of the Presbyterian Church (U.S.A.), including synod executives, executive presbyters, COM and CPM moderators, stated clerks, and pension liaisons. At these annual gatherings, information is shared by members of the management team of the Board of Pensions, dialogue occurs, and a range of topics is discussed to heighten awareness of the many programs offered by the Board to meet the needs of members of the Benefits Plan.
In recent years at each RBC, the Board offers a pre-consultation seminar that provides an opportunity for participants to reflect on an important issue facing the church. These pre-consultation seminars have provided inspiration for a continuing series of booklets produced by the Board of Pensions. The 2008 pre-consultation seminar addressed the subject “Growing Healthy Churches,” and a new volume by the same name, the fifth in the series, was recently edited by Bill Forbes and produced by the Board of Pensions. The next volume, based on the 2009 seminar, will be titled “Encouraging Generosity in the Church.”
Audio files of some of the presentations from this year’s RBCs are available on Pensions.org. To listen, go to Pensions.org, select Forms & Publications, select E-learning, go to Regional Benefits Consultation, and select eRBC 2009, or click here and then select eRBC 2009.
In light of the need to conserve costs during these difficult economic times, next year there will be just two Regional Benefits Consultations. The 2010 RBCs are scheduled as follows:
Eastern Regional Benefits Consultation
Tampa, FL
April 21-22
Western Regional Benefits Consultation
Los Angeles, CA
April 28-29
Clergy Salary Study information released
The Board of Pensions annually tabulates the median and average effective salary reported to it for minister members of the Benefits Plan who are serving U.S. congregations.
The most recent study, as of May 1, 2009, shows the median salary of all Presbyterian Church (U.S.A.) minister members of the Benefits Plan serving U.S. congregations is $52,200, as compared with $50,800 one year earlier: an increase of 2.8%. The average salary of these ministers is now $57,199, an increase of 2.8% from last year's average of $55,652.
Median salary, rather than average salary, is used in certain benefit calculations because it is less influenced by a few very high or very low salaries.
Note: Watch your email in mid-July for a clergy salary study organized by synod.
Watch for Your Annual Statement of Benefits, a key planning resource
Your Annual Statement of Benefits 2009 will be mailed in early July to all active Benefits Plan members as of January 1, 2009. This personalized publication details the benefits coverage of a given member and his or her family, if applicable. It should provide the foundation for an annual financial planning session by those members who have not yet retired, as explained in the article “How to Use Your Annual Statement of Benefits” appearing on Pensions.org.
Active Benefits Plan members are encouraged to take the time to open and carefully review the statement for accuracy when it arrives. If you do not receive this document by the end of July, contact the Board of Pensions at 800-773-7752 (800-PRESPLAN).
2008 Annual Report available
The Board of Pensions recently published its 2008 Annual Report. This report provides an overview of the Board's work of the past year, a review of its plans and programs, and a look at its fiscal health. Copies are available at Pensions.org or by request at communications@pensions.org. If you request a copy by email, please be sure to provide your full name and current mailing address.
Share your story
Stewardship of Self takes commitment, but the pay-offs can be great. One of the ways the Board supports your steps to better self care is by posting members’ stories on Pensions.org.
Do you have a story about how you used one of the programs offered by the Benefits Plan to overcome a challenge? An anecdote of how you exhibited Stewardship of Self in some other way? An inspirational tale of a marathon you ran or a weight loss goal you achieved? If so, we'd like to hear from you. Go to Share Your Story on Pensions.org, click on the “Share Your Story” button, and tell us about it.
Benefits Connect offers secure benefits information access
In today’s world, benefits are increasingly valuable, and it’s important that members manage their benefits in much the same way that they manage their money. That’s why the Board of Pensions offers Benefits Connect, a secure, online site that allows Benefits Plan members to access their personal and benefits information and use helpful planning tools.
On Benefits Connect, active and retired members and their surviving spouses can, as applicable:
- view benefits or payment information
- view and update personal and dependent information
- change direct deposit information
- access planning tools, including a pension estimator and a total death benefits calculator, and more
Plan members are encouraged to take advantage of the convenience of Benefits Connect and register today.
The Board of Pensions publishes The Board Bulletin electronically after each regular meeting of the Board of Directors.
To receive a copy by mail, call us at 800-773-7752 (800-PRESPLAN); to receive it by email, write communications@pensions.org, providing your name and email address. Or look for it online at our Web site, Pensions.org.
The Board of Pensions of the Presbyterian Church (U.S.A.)
2000 Market Street
Philadelphia, PA 19103-3298