December 2000

Active Member Benefit Information

New legislation to allow intersystem transfers with Cincinnati Retirement System

An amendment to House Bill 535, which passed in November, will allow for the transfer of service credit and contributions between the five Ohio Retirement Systems (ORS) and the Cincinnati Retirement System (CRS). Before the intersystem transfers can begin, however, the retirement systems must enter into an agreement for the administration of service credit transfers and the Cincinnati City Council must adopt the agreement by ordinance.

Under current law, ORS members can purchase credit for service rendered in CRS; however, there are no specific provisions for intersystem transfers and CRS is not required to transfer employee or employer contributions. In order to purchase credit for full-time service rendered in any of the other ORS and the CRS, members who joined OP&Fprior to September 16, 1998 must pay the amount withdrawn from the other retirement system, plus interest. Members who joined OP&Fafter September 16, 1998, additionally must pay the difference between the employee and the employer contribution rates of OP&Fand the other retirement system to receive full credit.

The intersystem transfers can begin on April 1, 2001, which is the bill's effective date, if the agreement between the retirement systems and the City of Cincinnati is executed before that date.

Survey shows member support for DROP program

The results of a survey sent to all OP&Factive members in August showed a high level of support for OP&'s proposed Deferred Retirement Option Plan (DROP). In all age groups, at least 80% of survey respondents said that they supported DROP legislation and that they would enroll in DROP when they became eligible.

Although there was great support in all age groups, support did increase with age, as indicated on the charts on this page. Police officer respondents expressed somewhat stronger support and likelihood to enroll than firefighters. Overall, less than 10% of respondents opposed DROP.

The survey experienced a 15% response rate with active members aged 50 and older most likely to respond. Paul Werth Associates, an independent third-party research firm, received all completed surveys and tabulated the results.

The Board now will determine the next steps for advancing the DROP proposal, which cannot be offered to membership without the enactment of legislation. Under OP&'s proposed DROP program, members who are eligible for service retirement would continue to work and accrue benefits consisting of the monthly pension amount that would have been paid to them, plus a portion of ongoing OP&Fmember contributions and interest.

The employers of all individuals who became OP&Fmembers on or after December 1, 1998 are required by state law to submit information to OP&Fcertifying the individual's physical condition prior to their OP&Fmembership.

The medical information that employers must provide to OP&Fon behalf of these members includes a physician's diagnosis and evaluation on the existence of any heart, cardiovascular, or respiratory disease. The physician also must attach the results of the following medical testing procedures: spirometry, chest x-ray, lipid profile, electrocardiogram, and cardiac stress test. A physician must have conducted all testing prior to the individual becoming a member of OP&, but no more than nine months prior to the OP&Fmembership date. In addition, the member must complete a medical questionnaire indicating past medical, family, and occupational history.

Members should make sure that their employers are in compliance with this requirement. For purposes of determining OP&Fdisability benefit awards under Ohio law, cardiovascular, chronic respiratory, and heart diseases can only be presumed to be duty related if the pre-employment physical requirements are met and the report of the pre-employment physical confirms that the condition did not exist at the time an individual became an OP&Fmember. Without pre-employment medical information on file with OP&, a member still may qualify for on-duty disability benefits resulting from other conditions or injuries based on satisfactory evidence that the disability was caused by job-related activities.

If active members transfer to another employer covered by OP&, the new employer will be required to submit the minimum medical testing information on behalf of the member if OP&Fdoes not have that information on file. OP&Fmust fine employers who do not file the required information within the necessary time period.

Board Update

Trustee election process to become more cost-effective under new law

As a result of the passage of House Bill 535 in November, OP&Fwill no longer be required to mail and count ballots for OP&FTrustee elections when there is only one candidate. Since OP&Futilizes an independent firm for these elections, the cost of each Board election is over $20,000, with printing and mailing accounting for a large portion of that cost. The rest of the Trustee election process will not change under the new law. To be considered a candidate, members must file nominating petitions by the statutory deadline and meet all legislative requirements.

Computers donated to state educational programs

OP&Frecently made an important investment guaranteed to bring positive long-term returns-an investment in education. To make its move into the education market, OP&Fdonated nearly 100 personal computers and technological equipment to educational programs that benefit students all across the state.

In the first phase of the donation process, OP&Fprovided computers and technological equipment to the Franklin County Educational Service Center (FCESC). This equipment, which benefited the FCESC's Low-Incidence Handicap Program, was placed in 20 special needs classrooms located in school districts throughout Franklin County, which is located in central Ohio. FCESC adapted the computers for the use of young children with limited abilities. Adaptive hardware and software such as touch screens, Intellikeys, and talking word processors were installed to allow students to easily communicate and access programs and other valuable information.

"We truly appreciate OP&'s donation," stressed Larry Flowers, a retired firefighter from Madison Township and past FCESC board president. "With community support and donations like this, we can provide children in Franklin County with many educational and technological resources."

In October, OP&Fdonated the remaining computers and equipment to OhioReads, Governor Taft's major education initiative to improve the reading skills of Ohio's kindergarten through fourth grade students. This initiative provides grants to schools, local businesses, and service organizations to set up tutoring and other programs to promote reading in this age group.

The computers are currently being outfitted with reading software to assist the reading tutoring programs set up in several elementary schools throughout the state. OP&'s donation is the first of its kind to the initiative.

OP&Fmade the decision to donate computers after a project to upgrade staff computers generated surplus equipment. Like many businesses, OP&Ftypically upgrades its computers every three years to keep up with current technology and to keep maintenance costs down. "Because the computing needs of schools are more modest than those of a business, these computers will be a perfect fit for these educational programs," said Michael Sawczyn, OP&'s Chief Technology Officer.

OP&Fwill continue to monitor the status of this exciting new investment. OP&FExecutive Director Allen Proctor recently attended a computer unveiling in an FCESC classroom for 4- and 5-year-olds. "The faces of these students really lit up when the computer was started," Proctor reported. "These computers will definitely prove to be a valuable tool and resource to the teachers and students in these classrooms. OP&Fmembers should be pleased and proud to know that the firefighters and police officers of Ohio have found another worthwhile way to help the children of Ohio."

Executive Director Column

As the first year in the new millennium draws to a close, the Trustees and staff of OP&Fwish you a happy holiday and a healthy 2001.

In 2000, we were pleased to continue to elevate services and benefits for survivors up to the same level as our services to members. This past July, OP&Fpaid out the first annual cost-of-living adjustment (COLA) to survivors and extended the COLA program to all pre-1986 retirees. We also quickly implemented new legislation that let us reinstate benefits to remarried survivors. Last April, OP&Fkicked off the Help Our Survivors in Transition (HOST) program to ensure that, during the stressful days following the death of a spouse, the security of OP&Fhealth care and survivor benefits continues uninterrupted. The HOST program is a fitting capstone to our efforts to make sure that, at all times, our survivors receive the attention and support that our motto embodies: "Security for Ohio Public Safety Officers."

Health care continues to be a major area of attention. In 2000, OP&Ffocused on improving the financing of the program. For 2001, we must turn our attention to what is driving this rapid increase in health care expenses.

By the end of 2001, members will benefit from expanded OP&Fservices. A significant multi-year effort to update and correct OP&Frecords for all 50,000 members will begin. At the end of this program, members should expect correct and current annual service credit and benefit statements and quicker processing when they apply for benefits.

Members who come to Columbus will see an expanded member service and reception area on the ground floor of our headquarters. Members who are unable to travel to Columbus will benefit from OP&'s new outreach program, which will provide retirement information, and eventually counseling, at locations throughout the state. Staff members involved in this new program are currently involved in extensive training and will most likely hit the road late next year.

On the legislative front, OP&Fhas banded together with police and fire member organizations to build a unique network that will focus on legislative matters that affect active and retired members. At the top on this list is House Bill 655, which would provide a uniform 3% COLA in place of the inequitable COLA bank system currently in effect. In addition, based on survey results that indicated that over 80% of members support a Deferred Retirement Option Plan (DROP) benefit option, OP&Fwill begin drafting DROP legislation in 2001.

With your help and support, I am confident that 2001 will continue the momentum to serve you better each and every year.

Behind the Phone

Carla Kelley, Customer Service

OP&Fmembers can be assured that they will receive tender loving care when they call into OP&Fcustomer service and speak with Customer Service Representative Carla Kelley. When asked why she has dedicated over 20 years to the customer service field, Carla responded, "I get great satisfaction from helping others solve their problems-I guess that's the mother in me." Carla, who joined OP&Flast April, also has devoted 34 years to the occupation of motherhood; she has four children and seven grandchildren. She and her husband, Clarence, have the entire family over for dinner just about every Sunday. In addition, Carla is a talented florist, specializing in silk bridal arrangements for friends and family.

Planning for Your Retirement

Unmarried retirants should name a beneficiary for lump-sum death benefit

When a retirant passes away, OP&Fmakes a one-time lump-sum payment of $1000 to that retirant's survivor or estate. If a retirant is married, the law requires OP&Fto make this payment to the surviving spouse. An unmarried retirant should select a specific beneficiary to receive this lump-sum benefit. If an unmarried retirant does not name a beneficiary, the retirant's estate will receive the lump-sum benefit. If a retirant marries after designating a beneficiary, the surviving spouse will receive the payment upon the retirant's death instead of the designated beneficiary.

To designate a beneficiary, unmarried retirants should contact OP&Fcustomer service at 1-800-860-9599 to request a Designation of beneficiary of Lump-Sum Death Benefit form. The form must be notarized.

The law only permits OP&Fto pay this lump-sum benefit to the survivors or estates of retired members; however, other benefits are available for the survivors of members who were not retired at the time of death. Please contact OP&Ffor more information on survivor benefits.

Retiree/Survivor Benefit Information

OP&Fto offer discount on health care contributions

Beginning July 1, 2001, OP&Fwill grant a discount of 30% off monthly premiums to benefit recipients with a total household income less than $10,000.

To receive the discount for 2001, benefit recipients must complete a Contribution Discount Application certifying that their annual total household income was less than $10,000 in 2000. Household income is defined as all annual income that benefit recipients, their spouse, and other members of their household receive, including OP&Fpension and survivor benefits, employment wages, Social Security, welfare assistance, Workers' Compensation, child/spousal support, unemployment, investment income, and any other income considered reportable by the IRS. The application must be notarized and returned to OP&Fby April 30, 2001. Discount applications, which will be available beginning February 1, will be sent upon request only.

Pictured Right - OP&FRetiree Trustees Patrick Patton (standing) and William Gallagher (to left of Patton) discuss the new health care contribution schedule with retirees following a recent Board meeting. The OP&FBoard and staff have been extremely pleased with the understanding and support that the membership has given the new health care contribution structure to be introduced next July.

OP&Fwill review each application received by the deadline, then notify the benefit recipient via letter in May, as to whether or not the discount will be granted for the discount period that will run July 1, 2001 through June 30, 2002. Benefit recipients who receive the discount must apply each year to renew their discount for the next period. Benefit recipients who do not receive the discount for this period can apply for the next discount period. OP&Fwill mail out the discount applications by request only.

The discount for the period of July 1, 2001 through June 30, 2002 will be based on the total household income for 2000. Benefit recipients who are granted the discount and experience an increase in income during the discount period will not lose the discount, but will not qualify for the next discount period (July 1, 2002 through June 30, 2003) if their income in 2001 is $10,000 or more. Benefit recipients whose income is reduced in 2001 will have to wait until the beginning of 2002 to apply for the next discount period.

Members and survivors who enroll in health care throughout the year and believe that they qualify for the discount should request an application within 90 days of the effective date of their health care coverage. They will then have 90 days to return the form. If approved, the discount would take effect the month following OP&'s receipt of the completed discount application. OP&Fwill mail out the discount applications to newly enrolled members and survivors by request only.

OP&Fwill adjust the contribution schedule annually on July 1 based on OP&'s total audited health care expenses for the previous year to ensure that benefit recipients continue to contribute 6% toward OP&'s overall health care costs. The Board also will adjust the discounted rates each year as necessary.

If you would like to apply for the health care premium discount, please contact OP&Ftoll-free at 1-800-860-9599 after February 1 to request an application.

OP&Fwill require new form to begin Medicare B reimbursements

Beginning early next year, OP&Fwill require benefit recipients to submit a newly-created form along with a copy of their Medicare card as satisfactory evidence to begin Medicare Part B reimbursements. On this new form, benefit recipients must certify that they are eligible for Medicare Part B coverage and also indicate the amount of their monthly premium. The benefit recipient must have the form notarized.

OP&Fwill introduce the new form as part of its monthly mailings to benefit recipients nearing Medicare eligibility age. Typically three months prior to their 65th birthday, OP&Fmails information to benefit recipients regarding Medicare and how to receive the Part B premium reimbursement. It is then the benefit recipient's responsibility to submit the proper information to begin the reimbursement. Until the new form is put into operation, OP&Fwill continue to accept the benefit recipient's Medicare Part B billing statement and a copy of their Medicare card as satisfactory evidence to begin Medicare Part B reimbursements.

Medicare Part B reimbursements, which are included in monthly benefit checks, begin the first of the month following OP&'s receipt of the required documentation. OP&F does not make retroactive reimbursements and does not reimburse dependent spouses.

The Health Care Financing Administration recently announced that the Medicare Part B premium would increase from $45.50 to $50 per month beginning January 1, 2001. The government recalculates this premium each year to reflect changes in health care costs or changes in Medicare law.