Office of the Chancellor 401 Golden Shore, 4 th Floor Long Beach, CA 90802-4210 562-951-4411 e-mail: hradmin@calstate.edu Date: February 2, 2011 Code: TECHNICAL LETTER To: Human Resources Officers Benefit Officers From: Evelyn Nazario Assistant Vice Chancellor Human Resources Management Subject: Implementation of New Voluntary Benefits Programs Effective May 1, 2011 Overview Audience: Action Item: Affected Employee Group(s)/Unit(s): Benefit Officers or campus designated representative responsible for administering CSU benefits programs Communicate information to eligible employees regarding new CSU Voluntary Benefits Programs CSU benefit eligible employees (eligibility varies by plan) Summary This Technical Letter announces the implementation of new California State University (CSU) Voluntary Benefits Programs and companies which include: Voluntary Accidental Death and Dismemberment (AD&D) and Voluntary Long Term Disability (LTD) offered by The Standard, Auto and Home Insurance offered by California Casualty, Group Critical Illness offered by Aflac (underwritten by Continental American Life Insurance Company), and MetLaw Legal Plan offered by Hyatt Legal Plans, Inc. (a MetLife company). A special open enrollment period will be held March 1 - March 31, 2011, with a plan effective date of May 1, 2011. During this open enrollment period, The Standard also is offering enrollment in Voluntary Life Insurance with guaranteed issue for those employees who previously waived this coverage. This Technical Letter should be reviewed in its entirety by Benefits Officers and any designated campus representatives responsible for the administration of employee benefits. General Information The Systemwide Benefits Office recently completed the Request for Proposal (RFP) process for new Voluntary Benefits Programs and is pleased to announce the implementation of the following new voluntary benefit plans and companies: Distribution: CSU Presidents Vice Chancellor, Human Resources Payroll Managers
Plan Company 1. Auto and Home Insurance California Casualty 2. Group Critical Illness Aflac 3. MetLaw Legal Plan Hyatt Legal Plans, Inc. (a MetLife company) 4. Voluntary Accidental Death & Dismemberment (AD&D) The Standard 5. Voluntary Long Term Disability (LTD) The Standard TECHNICAL LETTER Page 2 of 11 Implementation Timeline The Systemwide Benefits Office is on an aggressive implementation timeline and will need the assistance of the Benefits Officers to have a successful implementation of these new programs. Please note the following important dates: February 10, 2011 Date Week of February 21, 2011 (or earlier) March 1, 2011 Week of February 21, 2011 First Week of March 2011 March 2011 March 31, 2011 May 1, 2011 Description of Event Benefit Officers meeting at the Chancellor s Office to meet vendors, learn about the new voluntary benefit plans, and open enrollment. Release of e-mail blast with brochure on the new voluntary plans with contact/enrollment information to campus Benefit Officers to distribute to its employees. Open Enrollment begins. Individual vendor e-mail blasts marketing their benefit plan(s). HRM recommends campuses hold vendor meeting(s) to market plans to campus employees. These can be individual meetings or one event with multiple vendors. Open Enrollment ends. Effective date of new voluntary benefit plans. Eligibility Due to CSU policy and individual vendor requirements, eligibility varies by plan. The chart below provides the eligibility requirements by plan. Plan Auto and Home Insurance Group Critical Illness MetLaw Legal Plan Voluntary Accidental Death & Dismemberment (AD&D) Voluntary Long Term Disability (LTD) Employee Eligibility* All CSU employees, except Rehired Annuitants and FERP participants. All CSU employees with a time base, except Rehired Annuitants and FERP participants. In addition, the plan requires that the employee has coverage under a comprehensive health insurance plan or a Health Maintenance Organization (HMO). All CSU employees with a time base, except Rehired Annuitants and FERP participants. All CSU employees who meet the regular benefits eligibility requirement (described on page 3), except Rehired Annuitants and FERP participants. All CSU employees who meet the regular benefits eligibility requirement (described on page 3), except Rehired Annuitants, FERP participants, and employees who are currently eligible for the employer-paid LTD plan. *Student employees are ineligible.
Page 3 of 11 Regular Benefits Eligibility is defined as follows: 1. Regular appointment employee is appointed in a benefits eligible classification with a time base of at least half-time (0.5 Full Time Equivalent (FTE)) and with a length of appointment for at least six (6) months and one day, or; 2. AB 211 appointment Lecturers and Coaches (R03) in applicable class codes, who are appointed for at least six (6) weighted teaching units (WTUs) (i.e., 0.4 time base/fte) for at least one (1) semester or two (2) consecutive quarters. AB 211 appointments include a lecturer or coach appointed to a 0.4 FTE for an Academic Year (AY) or a 0.5 FTE up to full-time lecturer or coach appointed for one (1) semester or two (2) consecutive quarters. For purposes of determining benefits eligibility under AB 211 criteria, only AB 211 eligible classifications can be combined. Dependent Eligibility For those plans that allow dependent coverage, dependent eligibility is defined as follows: Spouse Domestic partner (registered through the Secretary of State process) Unmarried dependent children from birth to the end of the month in which the child reaches 23. A dependent child includes a stepchild, a natural child recognized by the father, or a child living with the employee in a parent-child relationship who is economically dependent upon the employee. A child ceases to be an eligible dependent upon marriage. Open Enrollment A special open enrollment period will be held from March 1 - March 31, 2011, with a plan effective date of May 1, 2011. During this initial open enrollment period, the Group Critical Illness and Voluntary Long Term Disability (LTD) plans will have a one-time guaranteed issue of coverage (i.e., no Evidence of Insurability required) provision available to all plan eligible employees. Prior to open enrollment, each vendor will provide benefit plan information and open enrollment instructions to CSU eligible employees. The CSU will also provide information about each plan, along with direct links to the vendor s individual websites on the CSU Systemwide Benefits Portal at http://www.calstate.edu/hr/benefitsportal/. The Systemwide Benefits Office recommends that each campus update their campus Human Resources/Benefits website with information about these new plans and the special open enrollment period. To assist in promoting the new plans, the Systemwide Benefits Office has agreed to allow each vendor to send an e-mail blast that contains highlights about its plan. The e-mails will be routed through the Systemwide Benefits Office and forwarded to each campus Benefits Officer for distribution. Enrollment Process In order to streamline the enrollment process (open enrollment and on-going) and reduce the workload on the campus Benefits Officers, all enrollments will be processed by the vendors and then forwarded to the State Controller s Office (SCO) for payroll deduction implementation (if applicable). If an employee has a question about their benefits, coverage level, or an issue with their monthly payroll deduction, the campus Benefits Officer should direct them to the vendor for assistance. Summary of Each Plan Below is a brief summary for each benefit plan: 1. Accidental Death and Dismemberment (AD&D) The Accidental Death and Dismemberment (AD&D) plan is offered by The Standard. This plan pays a benefit to the employee or his/her selected beneficiary in the event of death due to an accident or dismemberment at a benefit level selected by the employee.
Page 4 of 11 2. Auto and Home Insurance The Auto and Home Insurance plan is offered by California Casualty. This plan allows CSU eligible employees to obtain auto and home insurance policies at a discounted rate. The plan also has an identity theft component known as ID Defense. All policies are written for a 12-month period. 3. Group Critical Illness Plan The Group Critical Illness plan, offered by Aflac, will be underwritten by Continental American Life Insurance Company. This plan provides a lump-sum benefit payment to cover out-of-pocket medical expenses and the costs associated with life-changes following the diagnosis of a covered critical illness. Critical Illnesses covered under the plan include the following: Heart Attack, Stroke, Major Organ Transplant, Renal Failure (End Stage), Cancer, Carcinoma in situ, Coronary Artery Bypass Surgery, and Skin Cancer. 4. MetLaw Legal Plan The MetLaw Legal Plan is offered by Hyatt Legal Plans, Inc., which is a subsidiary of MetLife. This plan covers representation for many personal legal services for employees and their eligible dependents. Participants can receive services from a Network or Out-of-Network attorney. Services for covered legal matters performed by a Network attorney are fully paid for by the plan. Out-of-Network attorney fees for covered services are reimbursed based on a set fee schedule. The plan covers telephone and office consultations for an unlimited number of matters, even if the matter is not fully covered, so long as it is not excluded. The following services are fully covered under the plan: consumer protection matters, defense of civil lawsuits, document preparation and review, estate planning documents, family law, financial matters, immigration, juvenile matters, real estate matters, and traffic offenses (no DUI). In addition to unlimited advice and consultation, the plan also has an Identity Theft component. Employees can receive a consultation from an attorney on preventing identity theft. In addition the plan provides legal representation in the event it actually occurs. 5. Voluntary Long Term Disability (LTD) The Voluntary Long Term Disability Plan is administered by The Standard. This plan provides loss of income protection (up to 60%) due to a qualified disability. The vendor offers two (2) different plan options which include a 30 or 90 day waiting period. Plan Highlights Highlights about each of the plans, including eligibility, cost, guaranteed issue, dependent coverage, enrollment requirements, etc., are outlined in a table beginning on page six (6) of this technical letter. Detailed information about each plan can be obtained by visiting the vendor website or contacting their Customer Service Department directly. Termination of Sanders & Associates Voluntary Benefit Programs As a result of the implementation of new Voluntary Benefit Programs effective May 1, 2011, CSU will no longer offer the following voluntary benefits through Sanders & Associates: Accidental Death and Dismemberment (AD&D), Hospital Income Protection, Disability Insurance, Travel Assistance, and Cancer Medical Reimbursement. The Systemwide Benefits office will notify plan participants of this change in writing. The final payroll deduction for these benefit plans will be deducted from the March 2011 pay period (April 2011 pay warrant), with coverage ending April 30, 2011. Sanders and Associates will notify plan participants of any options to continue a plan through direct pay. Grandfathered Coverage for Sanders Participants Employees currently covered under one of the Sanders & Associates voluntary benefits plans (except Travel Assistance), will be eligible to enroll in the new vendors comparable plan, at his/her current coverage level (or comparable), even if it is above the new vendors guaranteed issue amount, without being subject to Evidence of Insurability (EOI). Their coverage will be considered grandfathered under the new plan and will be given credit
Page 5 of 11 for time served under the old plan in conjunction with the new plan s pre-existing condition clause and waiting period. In order to be eligible for the grandfathered coverage, the employee must elect coverage under the new plan during the initial open enrollment period of March 1 March 31, 2011. Employees who do not enroll during this initial open enrollment period will be subject to Evidence of Insurability. Voluntary Life Insurance Special Open Enrollment Period with Guaranteed Issue In conjunction with the new voluntary benefits program open enrollment, The Standard will be offering a special one-time guaranteed issue (unless previously declined) for its Voluntary Life Insurance product. During this special enrollment period, employees can elect up to $100,000 of life insurance without being subject to Evidence of Insurability. Normally, employees who do not enroll within 60 days of employment are subject to Evidence of Insurability. This special offering does not apply to dependents. Vendor Open Enrollment Meetings It is highly recommended that each campus hold vendor meeting(s) in order to market the new plans to campus employees. These can be individual meetings, or one event with multiple vendors. It is critical to the success of these programs that campuses provide vendors with the opportunity to market their plans to the campus community. Each vendor has been provided with a list of Benefit Officers in order to coordinate meetings, as appropriate. In addition, each campus Benefits Officer was provided a vendor contact list. Benefit Officers Meeting On February 10, 2011, the CSU Systemwide Benefits Office will be holding a Benefits Officers meeting at the Chancellor s Office in order to introduce the new vendors, provide plan highlights, and discuss the special open enrollment period. Space is limited to two (2) representatives per campus. The meeting will be from 8:30am 5pm. Attendance at this meeting is strongly encouraged. An agenda is provided as attachment A. Further information regarding registration for this meeting will be forwarded to each Benefit Officer via e-mail. Please note: Special arrangements are being made to broadcast the meeting via webcast. Additional information regarding the webcast will be forwarded to each Benefit Officer via e-mail.
Page 6 of 11 Highlights of the New Voluntary Benefits Plans MetLaw Legal Plan Auto and Home Insurance Group Critical Illness Vendor Hyatt Legal Plans, Inc. (a MetLife company) California Casualty Aflac CSU Eligibility All CSU employees with a time base are eligible for this plan, except Rehired Annuitants and FERP participants. All CSU employees are eligible for this plan, except Rehired Annuitants and FERP participants. No time base is required. All CSU employees with a time base are eligible for this plan, except Rehired Annuitants and FERP participants. Special Plan Eligibility Requirements Not applicable Not applicable Health Plan Requirement: employee must be covered under a comprehensive health insurance plan or a Health Maintenance Organization (HMO). (The comprehensive health plan or HMO plan does not have to be a CSU/CalPERS administered plan.) Age Requirement: issue age is 18-64 Employee Coverage Limits Not applicable Varies by insured Minimum: $5,000 Maximum: $50,000 Spouse Coverage Included at no additional cost to the employee. Available at an additional cost. The employee may elect to purchase coverage for their spouse. The spouse amount may not exceed 50% of the employee amount, subject to the minimum face amount. In order to apply for spouse coverage, the employee must also apply for coverage. If the employee does not meet the minimum underwriting requirements necessary to participate in the plan, the spouse can still obtain coverage.
Page 7 of 11 MetLaw Legal Plan Auto and Home Insurance Group Critical Illness Dependent Child(ren) Coverage Enrollment Period Guaranteed Issue Amount Coverage Effective Date Included at no additional cost to the employee. This plan has a set enrollment period. Employees are eligible to enroll in this plan during the following designated time periods: 1. New Hires: within 60 days of employment 2. CSU designated annual Open Enrollment Not applicable. The first of the month following the pay period that the deduction was taken (i.e., first deduction taken out of the April pay period, coverage effective May 1 st ). Available at an additional cost. This plan does not have a designated enrollment period. Employees are eligible to enroll at any time during employment. Not applicable. The effective date of coverage is the same date that coverage is actually bound, and is not tied to when the payroll deduction starts. Each eligible dependent child is covered at 25% of the primary insured amount at no additional charge. The employee must be enrolled in order for children to be covered. Children-only coverage is not available. This plan does not have a designated enrollment period, although there are enrollment parameters regarding Guaranteed Issue. Guaranteed Issue is available during the following enrollment periods: 1. Special Open Enrollment Period: March 1 - March 31, 2011 2. New Hires: within 60 days of employment guaranteed issue (not subject to evidence of insurability) Evidence of Insurability will be required if an employee does not enroll during one of the designated enrollment periods listed above. Employee: $20,000 Spouse: $10,000 Child(ren): N/A Coverage will be effective the date the employee signs the application. Plan effective date is NOT tied to the timing of the first deduction.
Page 8 of 11 MetLaw Legal Plan Auto and Home Insurance Group Critical Illness Coverage End Date Can an Employee Cancel Their Coverage Mid- Year? Monthly Plan Premium The end of the benefit plan year, or Upon separation of employment coverage terminates on the last day of the month following the pay period that the last deduction was taken (i.e., if the last deduction was taken out for the May pay period, coverage would end on June 30 th ). Members are required to remain in the plan for a full benefit plan year. New hires are required to remain in the plan for the remainder of the benefit plan year. Active employees can only terminate coverage during a designated open enrollment period. Coverage end date varies by insured. If employment ends prior to the end of the policy period, the separated employee maintains the current rate through end of policy period and can direct pay. There is no minimum enrollment period for this plan. Employees can cancel this policy at any time during the year. $19.70 Varies by insured Varies by insured Coverage terminates on the last day of the month following the pay period that the last deduction was taken (i.e., if the last deduction was taken out for the May pay period, coverage would end on June 30 th ). There is no minimum enrollment period for this plan. Employees can cancel this policy at any time during the year. Payment Options Payroll deduction Payroll deduction, direct payment, ACH (checking) Payroll deduction Payroll Deduction Information Vendor Contact Information SCO Deduction Code: 075-132 Deductions will be processed on pre-paid basis. Post-tax. www.metlife.com/mybenefits Customer Service: 800-GET MET8 (800-438-6388) SCO Deduction Code: 075-105 The timing of the deductions (if this payment option is selected) will vary by insured and will be coordinated by the vendor. Post-tax www.calcas.com/csu Customer Service: 866-680-5142 SCO Deduction Code: 075-133 Deductions will be processed on pre-paid basis. Post-tax. www.aflacgroupinsurance.com Customer Service: 800-433-3036
Page 9 of 11 Voluntary Long Term Disability (LTD) Voluntary Accidental Death & Dismemberment (AD&D) Vendor The Standard The Standard CSU Eligibility Special Plan Eligibility Requirements Employee Coverage Limits Spouse Coverage Dependent Child(ren) Coverage Enrollment Period All employees who meet the CSU regular benefits eligibility requirement (referenced on page 3), except Rehired Annuitants, FERP participants, and employees who are currently eligible for the employer-paid LTD plan. Not applicable Benefit Waiting Period Election Options: 30 or 90 days Income Benefit Limit: 60% Insured Pre-disability Earnings Limit: $12,500 Minimum Monthly Benefit: $100 Maximum Monthly Benefit: $7,500 Coverage not available Coverage not available This plan does not have a designated enrollment period, although there are enrollment parameters regarding Guaranteed Issue. Guaranteed Issue is available during the following enrollment periods: 1. Special Open Enrollment Period: March 1 March 31, 2011 2. New Hires: within 60 days of employment guaranteed issue (not subject to evidence of insurability) Evidence of Insurability will be required if an employee does not enroll during one of the designated enrollment periods listed above. All employees who meet the CSU regular benefits eligibility requirement (referenced on page 3), except Rehired Annuitants and FERP participants. Not applicable Minimum: $25,000 Maximum: $1,000,000 Amounts may not exceed ten times the employee s basic annual earnings. Coverage available at an additional cost. Up to 60% of employee s amount. Coverage available at an additional cost. Up to 15% of employee s amount, not to exceed $25,000 for each child. This plan does not have a designated enrollment period. Employees can enroll at anytime during the year and will not be subject to Evidence of Insurability.
Page 10 of 11 Voluntary Long Term Disability (LTD) Voluntary Accidental Death & Dismemberment (AD&D) Guaranteed Issue Amount Full Benefit Full Benefit Coverage Effective Date Coverage End Date Can an Employee Cancel Their Coverage Mid-Year? Monthly Plan Premium The first of the month following the pay period that the deduction was taken (i.e., first deduction taken out of the April pay period, coverage effective May 1 st ). Coverage ends on the date that employment ends, or The last day of the month following the pay period that the last deduction was taken (i.e., if the last deduction was taken out of the November pay period, coverage would end on December 31 st ). There is no minimum enrollment period for this plan. Employees can cancel this policy at any time during the year. Varies by insured The first of the month following the pay period that the deduction was taken (i.e., first deduction taken out of the April pay period, coverage effective May 1 st ). Coverage ends on the date that employment ends, or The last day of the month following the pay period that the last deduction was taken (i.e., if the last deduction was taken out of the November pay period, coverage would end on December 31 st ). There is no minimum enrollment period for this plan. Employees can cancel this policy at any time during the year. Varies by insured Payment Options Payroll deduction Payroll deduction Payroll Deduction Information SCO Deduction Code: 075-131 Deductions will be processed on pre-paid basis. Post-tax. SCO Deduction Code: 075-130 Deductions will be processed on pre-paid basis. Post-tax. Vendor Contact Information http://www.standard.com/mybenefits/csu/ Customer Service: 800-378-5745 http://www.standard.com/mybenefits/csu/ Customer Service: 800-378-5745
Page 11 of 11 CMS Processing Instructions This Technical Letter has impact to CMS Baseline (Oracle/PeopleSoft). The following new deduction codes will be added to the system: Deduction Code Plan Carrier 075-130 Voluntary Accidental Death & The Standard Dismemberment 075-131 Voluntary Long Term Disability The Standard 075-132 MetLaw Legal Plan Hyatt Legal Plan 075-133 Group Critical Illness Aflac Additional communication is forthcoming. General Information This Technical Letter is intended to provide an overview of the new voluntary benefit programs available to CSU employees. If there are any discrepancies between this technical letter and the vendor s official plan documents (e.g., contract, brochure, insurance certificate), the vendor s plan documents will govern. Questions regarding this technical letter may be directed to Human Resources Management at (562) 951-4411. This Technical Letter is available on Human Resources Management s Web site at: http://www.calstate.edu/hradm/memos.shtml. EN/dg Attachment
ATTACHMENT A Benefit Officers Meeting New Voluntary Benefit Programs Overview Thursday, February 10, 2011 8:30 a.m. 5:00 p.m. Chancellor s Office Wallace Room Time Topic Presenter(s) 8:30 a.m. Welcome and Overview Pamela Chapin 8:45 a.m. MetLaw Legal Plan Hyatt Legal/MetLife 10:15 a.m. Break 10:30 a.m. Group Critical Illness Plan AFLAC Noon Lunch 1:00 p.m. Disability Income The Standard AD & D Voluntary Life special enrollment 3:00 p.m. Break 3:15 p.m. Auto and Home Insurance California Casualty 4:30 p.m. General Information and Wrap Up Pamela Chapin Michelle Hamilton Donelle George 5:00 p.m. Adjourn