Healthcare Reform Set For Halloween

OCTOBER 18, 2013: On Tuesday, the Joint Committee on Public Service will conduct a public hearing that includes legislation filed by the Association relative to disability retirement.

The bills, filed on our behalf by Representative Tacky Chan (D-Quincy), propose to improve the ordinary disability benefit for future retirees, as well as alter the oversight of disability retirees.

H2258 seeks to modernize the ordinary disability benefit by changing the formula that applies to non-veterans. In order to apply for ordinary disability, an employee must be vested with not less than 10 years of creditable service. Veterans receive 50% of their one -year average. However, non veterans use the age factor as if they are 55.

The Association’s proposal would increase the non veteran age factor to age 60, thus granting a 2.0 factor for Group 1, as opposed to the 55 factor of 1.5.

“Unfortunately, this bill cannot be crafted to increase benefits for existing ordinary disability retirees. Federal law does not allow benefits such as this to be increased under a defined benefit system, so we must work on other means for existing retirees, such as improved COLAs,” said Association President Ralph White, who is also an elected member of the State Retirement Board. “However, it is important that we do something to help those employees who may become disabled in the future.

“The current benefit level is just too low. It’s been decades since the current benefit level was set and the time has come to look at updating it to modern times.”

In addition to H2258, Chan also filed H2259 and H2234 for the Association. These bills makes changes to allowable earnings for current and future disability retirees, as well as alters the reexamination process.

The proposal contained in H2259, which was also endorsed earlier this year by the Special Commission on Disability Retirement, would increase the allowable outside earnings of disability retirees by $10,000 annually. Presently, the additional outside income is based on the difference between a disability retiree’s pension and what their former job now pays, plus an additional $5,000 dollars.

H2234, ends the practice of reevaluating or examining disability retirees, who have been retired 10-or-more years and have already undergone at least three previous examinations.

“It has been 31 years since the outside earnings limit was set at $5,000. Increasing it to $15,000 is inline with inflation, as well as the high cost of living in 2013,” explains Legislative Liaison Shawn Duhamel. “For many retirees, this is a matter of making ends meet for their families.”