Presentations text content in NFL Postretirement Plans
Slide1
NFL Postretirement Plans
Jackie
Cullinan
Jennifer Haddad
Andrew Shin
Karen Wang
Slide2Discussion TopicsNFL pension plan today as compared to the NBA and MLB
NFL retirement plan historyIssues with the retirement planLack of representation
Conflict of interest
Slide3League Stats ComparedNFL brought in $7.1 million in 2007
NBA: $3.6 billionMLB: $4.3 billionAverage NFL career is 3.5 seasonsNBA: 4.82 seasons
MLB: 5.6 years
Average NFL player salary is $1.1 million per year
NBA: $4 million per year
MLB: $2.8 million per year
Slide4Pension Plans Compared
Vested in NFL plan in 3 seasonsNBA: 3 seasons MLB:
Retirement Benefits in 43 days
Medical Benefits in 1 day
NRA for NFL pension plan is 55 years old
NBA: 50 years old
MLB: 62 year old, pro-rated
Average NFL pension payout is $12,165 per year
NBA: $19,000 per year
MLB: $36,700 per year
Slide5Brief NFL Benefit History
1959 – First NFL pension planChanges result from negotiations between the NFLPA and NFL Management Council Until 1993 CBA, changes were insignificant
Ex – 1982 CBA increased benefit credits by $5 per month, per credited season
The result: Modest salaries and negligible retirement benefits left players with little savings. The nature of football and lack of medical benefits left retirees with medical issues and bills that they had to cover themselves.
Slide6NFL Benefit FundingA portion of NFL’s total revenues are allocated to players annually
Active players’ salariesActive and inactive players’ benefitsThus, as league revenues increase, funding can increase
The issue: Former players complain that they made the game what it is today, and today’s players are reaping the benefits
Slide71993 CBA – A Year of ChangeGuarantee of over $1billion in pension, post-career, and health benefits for current and retired players
Retroactive pension increases30% for pre-59ers and 40% post-59ersDecrease in vesting requirements
From four credited seasons to three
Slide81993 CBA (continued)Establishment of new programs
Retiree Medical BenefitsSecond Career Savings Plan – 401(k)Total and Permanent Disability Benefits
Selection of overseers for post-retirement plan
Plan Counsel – Groom Law Group
Plan Actuary – Aon Consulting
Slide91998 CBAExtended 1993 CBA through 2003Established annuity plan
Increased lowest benefit creditFrom $80 to $100 per month, per credited seasonIncreased T&P disability benefit
Changed pension eligibility requirements
From five seasons to four
Slide102002 CBAExtended 1998 CBAIncreased lowest benefit credit
From $100 to $200 per month, per credited season
Slide112006 CBAExtended 2002 CBA through 2012
Tripled widows’ and surviving children’s benefitsEstablished Plan 88 Increased monthly pension amount of those who played 1983-2006 by 10%
Increased portion of revenues to players
League
Season
Percentage
2006, 2007
57%
2008,
2009
57.5%
2010, 2011
58%
Slide122006 CBA (continued)Increased lowest benefit credit
Post-retirement, active and inactive players must receive at least the following per month, per credited season
Credited Season
Benefit Credit
Before 1982
$250
1982-1992
$255
1993-1994
$265
1995-1996
$315
1997
$365
1998-present
$470
Slide13Improvements Since 20062007 – Established benefits and programs
Health Reimbursement Account PlanCardiovascular Health ProgramNFL Player Joint Replacement Benefit Plan
Provided assistance with living arrangements
2008
Provided additional medical assistance
Announced changes to T&P and LOD disability benefits
Slide14Criticisms of the NFL Pension PlanConflicts of Interest
Actuary Retirement BoardLack of representation
Slide15Conflicts of Interest - ActuaryActuaries determine the necessary contributions by
NFL owners to fully fund retirement plans.Actuarial for NFL - Aon Consulting
Aon Consulting founder and Board of Director member are 20%
owners
of the Chicago Bears
Slide16Conflicts of Interest Disability Benefits
Only 2% receive disability benefits EligibilityCannot receive retirement benefits before NRA
“Total and Permanently Disabled”
Slide17Conflict of Interest – Retirement Board
Is the player “totally and permanently disabled?”Determined by …
Neutral physician,
Appointed by the Retirement Board
Reviewed by two-person Disability Initial Claims Committee.
Appeal process:
Retirement Board
Medical Advisory Physician
Slide18Conflict of InterestProblem?
Retirement Board is 6 members3 - NFL Management Council3 – NFLPA
BUT NFLPA delegated positions to Aon Consulting
Karen
Slide19Conflict of Interest – Retirement Board
Is the player “totally and permanently disabled?”
Determined by …
Neutral physician,
Appointed by the Retirement Board
Reviewed by two-person Disability Initial Claims Committee.
Appeal process:
Retirement Board
Medical Advisory Physician
Problem affects these areas
Slide20Lack of RepresentationComparison
NBA gave pre-1965 players an 50% increase in benefits NFL gave pre-1982 a 25% increase in benefits and post-1982 a 10% increase
Executive Director of NBPA, Billy Hunter:
“This is an important gesture and a tangible benefit for the pioneers of our league”
Former NFLPA executive director, Gene Upshaw
hada
different focus
“The bottom line is I don't work for them. They can complain about me all day long … But the active players have the vote. That's who pays my salary.”
Slide21Lack of RepresentationGene Upshaw was primarily concerned with helping current players during his tenure despite being a former player
Former players were getting less pensionFewer older players are even eligible
NFL was not the multi-billion dollar industry it is today
Today, the NFL spreads the knowledge of saving and retirement to its rookies
Results in many former players going homeless
Slide22What’s Being Done?
Mike Webster, a Hall of Fame center who played for the Pittsburgh Steelers died in 2002 Was homeless at the time
Suffered from mental illnesses attributed from concussions during his playing days
Many players take out their pensions early – meaning they receive even less money
Concussions and a variety of other injuries can cause permanent long-term damage
Many former players rely solely on their pension checks as income – making them below poverty level
Slide23What’s Being Done?While pension and other benefits have increased in recent years, it is still not enough
Several former players and organizations have established organizations or websitesDignity after Football, Inc.
Fourth & Goal
Gridiron Greats
Hall of Fame Enshrine Assistance Fund
Hall of Fame Players Association
The John Mackey Fund, Inc.
Slide24What’s Being Done?In 2007, Kyle Turley donated his game check to Gridiron Greats
Turley is quoted, in a New York
Times
article
, as saying: “Are we going to wait until guys die? Are we going to wait
until guys
commit suicide before we make a difference and change this thing
?”
Other players have taken similar steps in helping older, retirees
Additionally, former pro athletes Charles Barkley and John McEnroe have also made sizable contributions
Slide25What’s Being Done?Mike Ditka asked each NFL team to donate 100k to help older retirees
Some teams sent in a measly $5,000 checkOlder players are often forgotten despite their efforts into making the league what it is todayBetter playing conditions today for athletes
Injury treatment, etc
Slide26Questions?
NFL Postretirement Plans
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