for 2017 949 8249765 wcdmuciedu Disability Plans Background UC currently offers two types of disability coverage UCpaid shortterm disability coverage ShortTerm Disability ID: 562268
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Slide1
New Disability Plansfor 2017 (949) 824-9765wcdm@uci.edu Slide2
Disability Plans Background
UC currently offers two
types of disability coverage
UC-paid short-term disability coverage (“Short-Term Disability”)
Voluntary, employee-paid supplemental short- and long-term disability plan (“Supplemental Disability”)Only employees with “Full” benefits are eligible for disability coverage Supplemental disability is currently sold as one product; cannot be purchased separatelyFaculty and staff personnel policies provide paid sick leaveUC employees cannot participate in California State Disability Insurance (CA SDI)
2Slide3
2017 Disability PlansWhat’s changing:Plan design updated to incorporate best practices and improve financial stability – match premiums to benefits paid
Coverage eligibility expanded
to Core and Mid-Level
employeesOptional coverage is called “Voluntary” rather than “Supplemental”Employee has choice to purchase:Only Voluntary Short-term Disability (VSTD)
Only Voluntary Long-term Disability (VLTD)Both VSTD and VLTD Slide4
2017 Disability PlansWhat’s changing:One 14-day waiting period
VLTD will
begin after 6 months rather than one
yearMore generous age limit on VLTD: Social Security Normal Retirement AgeMore generous definitions of disability: VSTD definition based on “own job” at UC
VLTD determination based on “own occupation” for first two years, then “any occupation” Example: “own job” at UCLess restrictiveTakes into account specific job duties that are unique to your job at UC (sedentary vs. more physical)Slide5
2017 Disability PlansWhat won’t change:UC
continues
to provide
basic short-term coverage (Basic Disability) – Up to $800 a month (taxable)Require use of 22 sick days, if available, before benefits commenceUCRP Disability Income offset
UC contribution of medical insurance up to 6 months (Basic Disability period)Slide6
UC Disability Plans and CA SDIUC employees not eligible to participate in CA SDICA SDI is mandatory for all private and certain public employers, as defined in the Unemployment Insurance Code (UIC)In the UIC, UC employees are not included in the definition of state employees eligible for CA SDI
CA SDI is funded entirely by employee contributions
UC provides some short-term benefits at no cost to employees, and gives employees the option to purchase supplemental short-term and long-term disability coverage at reasonable
ratesSDI is short-term coverage only Slide7
UC Disability Plans vs CA SDIUC Voluntary Disability provides stronger benefits than CA SDIHigher percentage of income replacement – 60% vs. 55%Much higher monthly maximum - $15,000 vs. $4,500
Includes option for long-term disabilitySlide8
UC Disability Plans vs CA SDIUC’s short-term coverage costs less for all employeesAll UC employees, regardless of age band or retirement tier,
could enroll in
either
the Voluntary STD or the Voluntary LTD at a rate lower than the 0.9% of income charged by SDI in 2016Many employees can purchase short- and long-term coverage for less than the cost of only short-term coverage under SDIAll UC employees under the age of 49, regardless of retirement tier, can enroll in both the
Voluntary STD and the Voluntary LTD at a rate lower than the 0.9% of income charged by SDI in 2016Slide9
Choice of CoverageSlide10
Summary of New Plan FeaturesUp to $800 MaxUp to $15,000
Up to $15,000Slide11
Short-Term Disability Plan Design
*CA SDI is provided for comparison only; UC employees cannot participate in CA
SDI. SDI is short-term disability only; coverage for 52 weeks
** Based on a 45-49 year old employee in the 1976 Tier making the average UC salary of $79K/year.
Cost for Supplemental STD currently is bundled with LTD; cost shown here is an estimate of the Voluntary STD portion of the bundled rate.
Current
2017
Plan
CA SDI*
Employ
er
-Paid
Benefit
UC-paid Base: 55%
of salary
,
up to
$800/month
Basic:
Same as Current
No
Employer Paid Benefit
Employ
ee
-Paid
Benefit
Supplemental:
70% of salary,
up to $15,000/month
Voluntary
:
60% of Salary, up to $15,000/month
55% of Salary, up to
≈$4,516/month
Waiting Period
Base: 7 days
Suppl: 7, 30, 90, or 180 days
(use 22 days of
sick leave, if accrued)
14 days
(or after 22 days of
sick leave, if available)
7
Days
Employee
monthly cost**
WP………….......7d / 30d / 90d
/ 180d
2017
rates
..…...$63 / $29 / $20 / $13
$28
$59
Contributions
Base: UC paid
Supplemental: Employee
paid
Basic
: UC Paid
Voluntary: Employee Paid
Mandatory
Employee-paid
(0.9% of salary)Slide12
Long-Term Disability Plan Design
Current
2017 Plan
Benefit
5
0% to $15,000/month
(up to 70% if
eligible for
UCRP Disability or other income)
60% to $15,000/month
Employee
monthly cost*
2017 rate:
$34**
$20
Waiting period
12 months
6 months
Maximum
duration
Age 65
Social
Security Normal Retirement Age
Definition of disability
Any
-
occupation
24
month own-occupation,
then any-occupation
Contributions
Employee paid
Employee paid
Based
on a 45-49 year old employee in the 1976 Tier making the average UC salary of $
79K/year who chose 7 day waiting period.
** Cost for LTD currently is bundled with Supplemental STD; cost shown here is an estimate of the LTD portion of the bundled rate.Slide13
One Time Opportunity! The new Voluntary Disability plans are available during open enrollment. (Coverage effective beginning 1/1/2017)Employees who are currently enrolled in Supplemental Disability and who make no active selection during OE will be enrolled in both VSTD and VLTD for 2017
Benefits will be based on the date of disability
Example: An employee with a disability date of 12/22/16 and a 30-day waiting period will receive 2016-level benefits, not 2017
2017 TransitionSlide14
Only during open enrollment there is no statement of health neededIf no enrollment into the plan during open enrollment, may apply at any time but a statement of health (EOI) will be required and subject to approval by Liberty Mutual.
No Evidence of Insurability RequiredSlide15
In general, employees with lower salaries and shorter waiting periods will have lower premiums under new design than currently.Example 1: 34-year old staff member with $50K annual salary currently purchasing Supplemental Disability with 7 day waiting period (2013 Tier)Example 2: 34-year old staff member with $
5
0K annual salary currently
purchasing Supplemental Disability with 30 day waiting period (2013 Tier)Note: Status-Quo is potential 2017 premium if there were no plan changes 2017 Monthly
Premium Rates2017 Status-Quo Premium2017 VSTD Rate2017 VLTD RateTotal 2017 Premium$ Change$52$13$5$18-$342017 Status-Quo Premium2017 VSTD Rate2017 VLTD RateTotal 2017 Premium$ Change$19$13$5$18+$1Slide16
Faculty eligible for medical leave and staff with large sick leave accruals may choose not to purchase Voluntary STD and could buy Voluntary LTD only.Example 3: 56-year old staff member with $125K annual salary currently purchasing Supplemental Disability with 180-day waiting period and 1100 hours of sick leave accrued (1976 Tier)
2017
M
onthly
Premium Rates2017 Status-Quo Premium2017 VSTD Rate2017 VLTD RateTotal 2017 Premium$ Change$80Not needed$54$54-$26Slide17
One time opportunity to enroll in VSTD (6 months), VLTD (after 6 months up to SS retirement age) or bothNo statement of health needed during open enrollmentUC’s Basic Disability, provides benefits of only up to $800/month taxable for 6 monthsEnrollment in VSTD and VLTD provides most comprehensive coverage
VSTD and VLTD will pay 60%, up to $15K
One waiting period: 14 days, use 22 sick if available
If enrolled into supplemental disability & take no action, will automatically be enrolled in both VSTD & VLTDOpen Enrollment ends at 5pm on Tuesday, November 22 What do I need to remember?Slide18
2017 Disability and Life insurance premium estimatorhttp://ucnet.universityofcalifornia.edu/compensation-and-benefits/disability-life-accident/premium-estimator-2017.php
Disability FAQ’s
http://
ucnet.universityofcalifornia.edu/oe/faq/disability-faq.html Open Enrollment Websitehttp://ucnet.universityofcalifornia.edu/compensation-and-benefits/disability-life-accident/disability/index-2017.html
ResourcesQUESTIONS???