MESSAGE FROM THE PRESIDENT
It has been a privilege serving as president of the VRSEA for the last four years. This is an organization I believe in and have been a member since 1990. I served as vice president for many years and took over as president when Joe Healy resigned because of illness. We have a hard working board of trustees, always trying to maintain or improve benefits for retirees. Three of our trustees serve as board members of the retired employee commission on health insurance, an advisory committee set up by Vermont State Statute. Michael Wiater serves as chairman. There are approximately 5,800 retired state employees many of whom are paid members of the VRSEA. We need more of you to join to help us meet our financial obligation. You can help by sending your dues to Vivian Butler. Dues are $20.00. The annual meeting is in September. Please join us for a meal and a good time while we take care of business for the association.
Thank you,
Cornelius F. Reed
LEGISLATIVE WRAPUP FROM OTIS & KENNEDY
Though it was a difficult budget year, the 2013-2014 legislative biennium successfully drew to a close on May 10, 2014 with a budget in place and new laws in various areas including: GMO labeling; economic development funding; shore land protection, minimum wage increase; opiate abuse treatment; minimum pre-K hours and more; however, many of the bills that Otis & Kennedy was following for the VRSEA were ultimately extinguished at the session's end and cannot be considered again unless re-introduced in the next biennium.
In the area of healthcare and health benefits, VT state employee retiree benefits remain intact; however, how they will or will not be a part of Green Mountain Care, the single public payer plan, in 2017, has yet to be fully clarified. A financing plan for Green Mountain Care is not even due from the Executive branch until after the next gubernatorial election, in January 2015.
This year, all eyes were understandably on the implementation of Vermont's Health Benefit Exchange for the individual and small group health insurance market ("Vermont Health Connect"), and, though it had its struggles and was initially delayed, the Exchange is up and running with overall strong enrollment.
Ultimately, what was to have originally been the legislature's own financing proposal at its introduction (S. 252) ended up passing as H.596 entitled Principles for Health Care Financing. H. 596, as passed, among other things, makes it clear that Green Mountain Care will be available to "[a]ll Vermont residents", but also that it "shall be the payer of last resort for Vermont residents who continue to receive health care through plans provided by an employer, by another state, by a foreign government, or as a retirement benefit." Questions, among many others, such as what premium would be paid, if any, for such "wrap" coverage, whether the active state employee and retiree coverage will ultimately merge with Green Mountain Care, and the details of how it will wrap around Medicare, all remain open questions yet to be determined. In the off-session, health care focus will be on the work of the Green Mountain Care Board and the Executive Branch with periodic and ongoing legislative committee oversight.
Another healthcare issue of note from this session started out as a bill (H.669), but ultimately was agreed upon outside of the legislative process in a "side letter of agreement" between the Administration and the VSEA. In short, effective January 1, 2015, for all individuals covered by a State Employee Health Plan, including retirees, whose primary medical insurance is Medicare, the State of Vermont will implement an Employer Group Waiver Plan ("EGWP") + Wrap with a Medicare Part D plan to replace the pharmacy benefit currently provided by the State Employee Health Plan(s) for outpatient prescription drug coverage. The "wrap" commitment is intended to provide additional coverage beyond the Part D benefits, if any, so beneficiaries have access to all the drugs covered under the State Employee plan(s) regardless of whether they are excluded under Medicare Part D. This step is projected to save the State between $700,000 and $1.2 million annually.
An important link to remember for these and other health care issues for the VRSEA and its members is the newly re-vitalized statutory committee (see 3 VSA 636), called the VT Retired Employee Committee on Insurance ("RECI"). The RECI group works with the Administration and VSEA members as well, on health insurance issues. In fact, it has recently been dealing with any potential EGWP transition issues, ahead of its roll-out, to ensure that state retiree pharmacy beneficiaries are indeed kept whole when they move to Medicare Part D starting in January of 2015. VRSEA members are encouraged to contact the VRSEA Board with health insurance input, questions and/or concerns for the RECI's consideration.
Otis & Kennedy, LLC is grateful for the opportunity to serve the VRSEA as your lobbyists, a/k/a public policy attorneys, and welcomes your input as well.
Update on New Prescription Drug Program Coming in January, 2015
We were pleased to be invited to participate in a recent meeting between the key players responsible for
coordinating and implementing the new prescription drug program for Medicare-eligible retirees that will
become effective in January of 2015. (More details on this new drug program, commonly referred to as EGWP
(Employee Group Waiver Program) are discussed in the Legislative Review article written by our Lobbyist.)
We came away from the meeting with a better understanding about the program and how it will affect
Medicare-eligible retirees. Of even greater comfort was how information about the new program and
anticipated changes will be disseminated to our retirees. In addition to receiving multiple direct mailings in the
fall, retirees will have updates through a variety of sources, including newsletters from the Treasurer's Office
and the VRSEA. It is evident the various State agencies and ESI (who will be responsible for administering
the EGWP) are extremely committed to ensuring all retirees are well-informed and knowledgeable before the
program goes live in January.
We expect to have more updated details in our next newsletter.
What is the Retired Employees' Committee (RECI)
The Retired Employees' Committee on Insurance (RECI) is a group organized by the executive branch under title 3 VSA Chapter 21 Sec. 636. It has six members appointed, three by the secretary of administration and three appointed by the VSEA. Members serve for two years. The RECI members are: Terry Macaig, Goldie Watson, Joan Eckley , Roger Dumas, Alan Blake and Mike Wiater.
The committee meets to review health insurance benefits available to retired employees through the state and make recommendations to the Secretary of Administration. The committee shall also recommend to the State Treasurer matters related to the dental plan.
It should be noted that this committee remained inactive until VRSEA and the VSEA Chapter worked together to bring the committee to life. Theo Kennedy of Otis and Kennedy (Lobbyists for the VRSEA) worked hard to bring about the formation of RECI. He is engaged with the group and has provided his time to do this additional work on behalf of VRSEA. RECI is grateful for his help in this matter.
There are changes to our health plan and RECI will "watch dog" the changes and make recommendations to help maintain the health plan all retirees have earned.
VT State Employees Retirement System Overview
The operation, administration and implementation of the state retirement system involve several entities including the Treasurer's office, Retirement Division, Retirement Board, Vermont Pension Investment Committee and Medical Review Board. The system requires the combined contribution of all these entities to ultimately provide the many services and benefits that retirees look forward to receiving into retirement.
Currently the State Retirees have two representatives that participate in the above process:
The Vermont Retired State Employees Assoc. (VRSEA) elects a member representative ever two years, to participate as one of the eight voting members on the State Retirement Board. Some of the duties of the board is to sets policies as needed in the administration of the system, makes determinations on retiree appeals of questionable benefit implementations or applications, oversees the administration of the supplemental 457 investment plan by Great West Services, oversees the administration of the retirees dental plan by Delta Dental, review, confirm and approve the Medical Review Boards recommended disability retirements. There are many other related activities by the board that are also addressed periodically. The board meets monthly via conference calls with quarterly meetings held in-house at the State Treasurer's office. The board's only investment activity is setting the assumed rate of return for the amortization of the unfunded liability. The retirement board does not establish or lobby for retirement benefits. They are established by the legislature.
The other current retiree representative serves as a voting member on the six members Vermont Pension Investment Committee, (VPIC). This person is elected every 4 years by four of the members on the State Retirement Board. The four members include the three VSEA members and the one VRSEA retiree member. This elected person has voting rights on all matters involving the investment of our retirement assets.
Retiree Data:
Currently, Roger P Dumas is the VRSEA retiree representative on the State Retirement Board and Robert Hooper is the VSERS retiree representative on VPIC.
The March 2014 preliminary Market Value of the retirement assets is currently over $1.5 Billion.
The Funding ratio of the retirement system as of 6/30/13 is 76.8%.
The Unfunded Liability is currently amortized to 2038 which would bring us to a fully funded status at that point.
Annual Payout of Retirement allowances as of 6/30/13 was just over $98,932,000 for FY 2013.
The total number of current state retirees is over 6000.
For more information about our retirement system, go the State Treasurer's Web-Site at www.vermonttreasurer.gov/
Lieutenant Governor Phil Scott is Looking for Retiree Suggestions
A recent CNN article highlighted a 14 year boy on a quest to reduce waste and save money at his school in the Pittsburgh area. He noticed he was receiving much more computer-printed handouts when he moved from elementary to middle school. He discovered by changing the typeface on the printers in his school to "Garamond" he could reduce their ink consumption by 24 percent, which would save $21,000 per year.
Our Lt. Governor, Phil Scott of "Vermont Everyday Jobs" fame, asks State of Vermont retirees to be as creative as the above teenager. Our retirees represent all aspects of state government operations with many thousands of years' combined experience. We've all had ideas on how the departments we worked for could save precious state dollars, but perhaps didn't share those ideas or, if we did share them, didn't see any action taken.
It seems every year when the legislature convenes, the message is that the State is facing a huge General Fund deficit unless revenue is increased or expenditures are reduced. Lt. Governor Scott would like to get a head start on next year's budget process with the help of the retirees of state government. He is asking retirees that have ideas on how to save State dollars and/or make State government more efficient to forward them to the VRSEA at irasollacel50@gmail.com or Ira W Sollace 580 West Hill Road, North Middlesex, Vermont 05682. These ideas will be compiled and represented to the Lt. Governor on August 1st. We will also post this list on our website.
Questions and Answers
Q: What is the timeframe for the VRSEA fiscal year?
A: According to the VRSEA by-laws, the fiscal year begins on October 1 and ends on September 30.
Q: When are the annual membership dues payable?
A: The annual dues should be paid no later than October 1st of each year for the following fiscal year. For
example, the membership dues for the fiscal year beginning October 1, 2014 through September 30, 2015
should be paid by October 1, 2014. Many of our members choose to pay for a year to two in advance to ensure
their membership stays current.
Q. What is the amount of an annual membership?
A: The dues are currently $20.00 per year. The Board sets the annual rate and periodically updates it if the
budget and/or membership warrant a change.
Q: Why should you become a member of VRSEA?
A: To support the work of the organization so that it may continue to advocate for retirees and protect their
benefits, provide a network for information and resources, and be a voice for all retired state employees. In
addition, VRSEA members may contact any of the trustees with specific questions that will be addressed as
promptly and accurately as possible. Finally, VRSEA members are invited to participate in an annual meeting
with a subsidized meal which affords an opportunity to socialize with their peers and hear the latest updates on
events that may interest and/or affect them.
Attention, Attention, Attention: Annual Meeting Information
This years' annual meeting is going to be at The Canadian Club in Barre, Vermont. This year the menu will have three choices, Chicken, Baked Ham and Baked Haddock; it will be plated and served. In an effort to avoid confusion at serving time your choice of entrée will be printed on your ticket which will need to be present at serving time. Details about time, pricing and directions will be forth coming in the near future. That said, save the date on your calendar, Tuesday, September 9th.