Supplemental Retire Health Benefits through the HPAE Retiree Medical Trust
Presentation to Local 5094 Members
April 8 – Newark
April 16 – New Brunswick
April 24 – Stratford
April 30 - Piscataway
HPAE Retiree Medical Trust
What is the HPAE Retiree Medical Trust?
The HPAE Retiree Medical Trust is a fund established by HPAE and participating employers to provide supplemental retiree health benefits through reimbursement of medical costs.
Which HPAE Employers are currently participating?
The following HPAE-represented hospitals are participating: Bayonne Medical Center, Christ Hospital, Cooper University Hospital, Englewood Hospital and Medical Center, Meadowlands Hospital, Palisades Medical Center, and Virtua/Memorial Hospital.
How is money contributed to the fund?
Each HPAE local union negotiates with the employer the level of contributions and how the money is contributed. Money can be contributed from employee (pre-tax) payroll deductions, employer contributions, and/or sick leave accrual pay-outs.
What is the Local 5089 (UMD RNs) Negotiations Committee proposing?
Why do UMD RNs and non-nursing Professionals need this benefit since we already have retiree health benefits from the state?
Retiree health costs are enormous. The average retired couple will have to pay over $200,000 in medical costs. While some UMD staff are or will be eligible for state retiree health benefits, those benefits do not cover all out-of-pocket costs, such as co-pays, deductibles, and services not included in the insurance plan. Our supplemental retiree health plan enables retirees to receive reimbursements for these costs.
Are benefits from the HPAE Retiree Medical Trust taxable?
No. The Trust is completely “tax advantaged”. Money contributed to the fund is not taxed; interest earned by the fund is not taxed; and reimbursement money is not taxable income.
HPAE Local 5089 Proposal on Retiree Health Benefits – March 31, 2008
Add a new section:
9.06 HPAE Retiree Medical Trust
In addition to any benefits provided to employees through participation in the Public Employees Retirement System or the Alternate Benefits Program, the University shall make a monthly contribution to the HPAE Retiree Medical Trust, in an aggregate amount equal to $.40 per paid hour for each full-time and part-time employee covered by this agreement, up to a maximum of 2080 hours per calendar year. This Trust shall remain separate and apart from any other employer retiree health insurance funding program unless changed by mutual agreement of the parties to the agreement.
Conversion of Sick Leave Supplemental Compensation to Retiree Medical Trust
Within six (6) months after ratification of the contract re-opener agreement by the Union, the covered members of the bargaining unit will participate in a referendum vote to determine whether a portion of the supplemental compensation payment (Section 7.9) will be transferred to the HPAE Retiree Medical Trust. Based upon an affirmative vote, for employees who are eligible for a supplemental compensation payment upon retirement based on accrued sick leave the University shall make contributions into the HPAE Retiree Benefit Trust in an amount equal to 50% of the employee’s supplemental compensation payment. The University shall contribute the monies on a pre-tax basis. These contributions shall be included as salary for purpose of calculating retirement benefits.
Contributions to the Trust shall be due at the Trust office on the 10th of the month following the month for which the contribution is made. Late payments may be subject to reasonable interest and/or penalties.
No Liability for Employer or Union
The monies contributed to the trust fund shall only be used for retiree health insurance premiums or health service expenses, and the reasonable costs of administering the Trust. The University hereby acknowledges receipt of the Trust Agreement governing the Trust and will cooperate with the Trust Office in reporting and depositing the required contributions set forth above, according to rules set by the Trustees of the Trust. The parties acknowledge the following provision in Article XI, Sections 1 and 2, of the Trust Agreement regarding limitations on the liability of the participating employers:
“1. Liabilities and Debts of Trust Fund
No signatory party or Trustee, and no participating employer, employer association, labor organization, employee, or beneficiary shall be responsible for the liabilities or debts of the Trust Fund.”