The medical plan premium subsidy will be provided upon the conditions set forth below in order to lessen or defray part or all of the cost of medical plans to eligible retirees, as hereinafter defined.
(a) Eligibility for Medical Plan Premium Subsidy. A retiree who is enrolled in plan(s) administered by the Board as part of the Medical Plan Program, and who is retired pursuant to Chapter 10 of Division 4 of this Code, shall be eligible for a medical plan premium subsidy as provided in Subsection (d) or Subsection (e), as applicable.
(b) Maximum Medical Plan Premium Subsidy. The maximum monthly medical plan premium subsidy for retired employees is $1,190.00. Beginning July 1, 2011, the Board, in its discretion, may change, by resolution, the maximum monthly amount of the medical plan premium subsidy provided to employees retired on or before June 30, 2011, so long as any increase:
(1) Does not exceed the dollar increase in the Kaiser two-party non-Medicare Part A and B premium; and
(2) The average percentage increase for the first year of the increase and the preceding two (2) years does not exceed the average assumed actuarial medical trend rates for the same period.
Any change made by the Board that exceeds the limits set forth in Subsection (b)(1) or (b)(2) herein must be submitted for Council review accompanied by an actuarial report. Any increases that are not acted upon by the Council within thirty (30) days after receipt of the report to Council for consideration of the increase are deemed approved. Should the Council reject the subsidy set by the Board, the Council shall determine the amount, if any, by which the subsidy shall be increased and shall adopt such change by resolution.
No increases in the maximum monthly medical plan premium subsidy shall be provided to members retired on or after July 1, 2011, except that former members who terminated employment prior to July 1, 2011, and retire on or after July 1, 2011, on a deferred vested basis without returning to membership shall be entitled to discretionary increases in the maximum subsidy as provided above regardless of the date of retirement. Notwithstanding all of the forgoing, increases in the monthly medical premium subsidy provided to retirees subject to Subsection (c) shall be governed by the provisions of that subsection, regardless of the date of retirement.
(c) Vested Right to Maximum Medical Plan Premium Subsidy Increases. Notwithstanding the provisions of Subsection (b), any member who at any time made an additional contribution to the Retirement Fund as provided in Section 4.1003, Subsection (c) of this Code shall obtain a vested right to, and the Board, by resolution, shall set, the increase in the maximum medical plan subsidy provided to such members at an amount not less than the dollar increase in the Kaiser two-party non-Medicare Part A and Part B premium.
(d) Medical Plan Premium Subsidy for Eligible Retirees without Medicare Part A. Those retirees who are receiving a service retirement allowance or a disability retirement allowance, who either are not eligible for Medicare or do not qualify for benefits under Part A of Medicare premium free, who have at least ten (10) years of Service and who are age fifty-five (55) years or older, shall have paid to their approved medical plan carrier on their behalf the following amount:
(1) Basic Monthly Subsidy. For one (1) to ten (10) whole years of Service Credit, forty percent (40%) of the maximum monthly medical plan premium subsidy amount established pursuant to the provisions of Subsection (b) or Subsection (c), as applicable.
(2) Additional Monthly Subsidy. For each additional whole year of Service Credit in excess of ten (10) years, add four percent (4%) of the maximum monthly medical plan premium subsidy to the Basic Monthly Subsidy.
(3) Maximum Monthly Subsidy. No retiree shall have paid to the retiree’s medical plan carrier an amount exceeding the maximum monthly amount established pursuant to Subsection (b) or Subsection (c), as applicable, or receive an amount in excess of the premium of the plan in which they are enrolled.
(4) Dependent Monthly Subsidy. The monthly medical plan premium subsidy shall be applied first to the retiree’s medical plan coverage with any balance applied toward the coverage of the retiree’s dependent(s).
(e) Medical Plan Premium Subsidy for Eligible Retirees Enrolled in Parts A and B of Medicare. Those retirees with at least ten (10) years of Service who are receiving a service retirement allowance or disability retirement allowance and who qualify for benefits under Part A and Part B of Medicare, shall have paid to the medical plan carrier providing them with a Medicare supplemental or coordinated plan the following amount:
(1) Monthly Subsidy Seventy-Five Percent (75%). For one (1) whole year of Service Credit, but less than fifteen (15) whole years of Service Credit, seventy-five (75%) of the single-party monthly premium of the approved Medicare supplemental or coordinated plan in which the retiree is enrolled.
(2) Monthly Subsidy Ninety Percent (90%). For fifteen (15) whole years or more but less than twenty (20) whole years of Service Credit, ninety (90%) of the single-party monthly premium of the approved Medicare supplemental or coordinated plan in which the retiree is enrolled.
(3) Monthly Subsidy One Hundred Percent (100%). For twenty (20) or more whole years of Service Credit, one hundred percent (100%) of the single-party monthly premium of the approved Medicare supplemental or coordinated plan in which the retiree is enrolled.
(4) Dependent Subsidy. The amount of the medical plan premium subsidy which is applied toward the coverage of dependents of a retiree enrolled in both Part A and Part B of Medicare shall not exceed that amount which may be applied toward the coverage of the dependent(s) of a retiree not enrolled in both Parts A and Part B of Medicare with the same years of Service Credit and covered by the same medical plan. If the same plan does not offer coverage for retirees who do not have both Medicare Parts A and B, the Board shall, by rule, determine the dependent subsidies in a manner that is consistent with plans that do offer both types of coverage.
Effective July 1, 2011, no increases in the amounts paid to the medical plan carriers under this Subsection (e) shall be provided on behalf of employees retired on or after July 1, 2011, or their dependents, except that former members who terminated employment prior to July 1, 2011, and retire on or after July 1, 2011, on a deferred vested basis without returning to membership shall be entitled to increases in the amounts paid to medical carriers under this Subsection (e) for themselves and their dependents regardless of the date of retirement. Notwithstanding all of the foregoing, increases in the amounts paid to medical plan carriers provided on behalf of retired employees subject to Subsection (c) herein shall be governed by the provisions of this Subsection (e) regardless of the date of retirement.
(f) Medicare Enrollment and Assignment. Retirees who are eligible to enroll in Medicare Part B must do so in order to qualify to receive the subsidy provided in Subsections (d) and (e) of this section. The Board may require retirees to enroll in and assign to LACERS any coverage that is provided by Medicare in order to qualify to receive the subsidy provided in this section, except that retirees who are not entitled to premium free Part A of Medicare are not required to enroll in Part A.
(g) Verification of Medical Plan Coverage. Retirees who are receiving a medical plan premium subsidy payable to their medical plan carrier pursuant to the provisions of this Article may be required from time to time to provide evidence satisfactory to the Board that their medical plan coverage or Medicare or other federal or state funded medical plan is in full force and effect.
(h) Payment Limitation. In no event shall the subsidy provided in this section, when added to any other medical plan subsidy provided by the Department of Water and Power or the Fire and Police Pension Plan, exceed the maximum amount established in Subsection (b) or (c), as applicable.
SECTION HISTORY
Added by Ord. No. 182,629, Eff. 7-25-13.
Amended by: Ord. No. 184,134, Eff. 1-22-16; Subsec. (a), Ord. No. 184,853, Eff. 4-6-17.