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Pensions and Benefits
CERTIFYING OFFICER LETTERS 2006

Also available: Archived EPIC E-Messages to Certifying Officers and EPIC Users


Subject Date
Report of Contributions, 4th Quarter 2006 (October 1st to December 31st) - Teachers’ Pension and Annuity Fund, Public Employees’ Retirement System & Police and Firemen’s Retirement System December 2006
Report of Contributions, 4th Quarter 2006 (October 1st to December 31st) - Autonomous State College/University/State Employers December 2006
SHBP Open Enrollment 2006 - State Biweekly Employers September 2006
SHBP Open Enrollment 2006 - Part-time - State Biweekly/Monthly Employers September 2006
SHBP Open Enrollment 2006 - State Monthly Employers September 2006
SHBP Open Enrollment 2006 - Local Government Employers September 2006
SHBP Open Enrollment 2006 - Local Education Employers September 2006
Report of Contributions, 3rd Quarter 2006 (July 1st to September 30th), Teachers Pension and Annuity Fund, Public Employees Retirement System, and Police and Firemens Retirement System September 2006
Report of Contributions, 3rd Quarter 2006 (July 1st to September 30th), Autonomous State College/University/State Employers September 2006
Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2007) - State Department Human Resource Directors; State Biweekly Payroll Benefit Administrators August 2006
Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2007) - State University and College Benefits Administrators; State Monthly Benefit Administrators August 2006
Chapter 366, P.L. 2005 - Enrollment of Fire Marshals into the PFRS - Police and Firemen's Retirement System July 2006
Report of Contributions, 2nd Quarter 2006 (April 1st to June 30th) - Teachers' Pension and Annuity Fund, Public Employees' Retirement System & Police and Firemen's Retirement System June 2006
Report of Contributions, 2nd Quarter 2006 (April 1st to June 30th) - Autonomous State College / University/State Employers June 2006
Chapter 368, P.L. 2005 - Service Credit While on Leave for Union Representation April 2006
Chapter 326, P.L. 2005 - Volunteer Firefighter Transfer to the PFRS - Police and Firemen's Retirement System March 2006
Revised Certificate of Member Term Life Benefits February 2006

CERTIFYING OFFICER LETTERS FROM OTHER YEARS

2014 CO Letters 2013 CO Letters 2012 CO Letters 2011 CO Letters 2010 CO Letters
2009 CO Letters 2008 CO Letters 2007 CO Letters 2006 CO Letters 2005 CO Letters
2004 CO Letters 2003 CO Letters 2002 CO Letters 2001 CO Letters 2000 CO Letters
1999 CO Letters 1998 CO Letters 1997 CO Letters    

Also available Archived E-Messages to Certifying Officers and EPIC Users.


December 2006

TO: Certifying Officer - Teachers’ Pension and Annuity Fund, Public Employees’ Retirement System and Police and Firemen’s Retirement System
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Report of Contributions, 4th Quarter 2006 (October 1st to December 31st)

This memorandum has pertinent information concerning the completion of your Report of Contributions (ROC).  Please read this memorandum before you make any changes to the ROC.

Should you have any questions or need assistance in completing the Report, please refer to http://www.state.nj.us/treasury/pensions/epbam/finance/roc.htm

DEADLINE FOR FILING UPDATE

Due to the overwhelming popularity of the I-ROC program and the time saved in preparing the report of contributions, the Division can now move forward with an attempt to reach its goal of updating member accounts in a timely manner. To accomplish this goal, effective immediately, all reports must be received no later than the close of business on January 25, 2007.  Reports received after this date may not be used to update member accounts.

Delays in receiving reports affect the timeliness of the Division providing services to ALL pension plan members, not just your employees and retirees. Unfortunately, we continue to experience delays associated with employer late reporting.  This new policy of strict adherence to established reporting deadline will alleviate that problem.

When you receive your quarterly ROC, you should review it immediately.  If you think you will have a problem in meeting the filing deadline, or if there is anything you do not understand, contact the Audit/Billing Section at (609) 292-3630.  Normally, reporting inquiries can be resolved with a telephone call.  If other arrangements need to be made to assist you in the completion of your ROC, the sooner you communicate that fact to the Division the better for everyone involved.

Reports of Salary Change (***NEW***)

The Division of Pension and Benefits is no longer providing to you reports of salary change as has been our past practice. Now that the majority of employers are reporting through the web, (I ROC), we are hoping that you would use the report of contributions to submit these salary changes for the next quarter. Should you need a paper report of salary change please call (609) 292-3630. This request should be made no later than February 1st, 2007, to allow for processing time.

TEPS

Please note that the only payments that should be submitted through TEPS are for monthly transmittal and appropriation payments. Employee shortages are not to be submitted through TEPS.

The fax number and address that you use to submit the Employer Authorization Forms to the Division of Pensions and Benefits is (866) 568-2495 or it may be mailed to State of New Jersey, Department of Treasury, Division of Pensions and Benefits,P.O. Box 9581, Trenton, NJ 08650-9581.

Most Retirement Plan Limits Increase for 2007

IRS has announced the 2007 cost-of-living adjustments (COLAs) for retirement plans. Many of the limits applicable to pension, and other retirement plans, increase for 2007.

The following plan limits are increased for inflation effective January 1, 2007:

  • Annual compensation limit. The maximum amount of annual compensation that can be taken into account for various qualified plan purposes, under Code Sec. 401(a)(17), is increased from $220,000 to $225,000.  Retirement plans administered by the Division of Pensions and Benefits affected by this change include the Teachers' Pension and Annuity Fund (TPAF), the Public Employees' Retirement System (PERS), the Police and Firemen's Retirement System (PFRS), the Supplemental Annuity Collective Trust (SACT), the Alternate Benefit Program (ABP), the Additional Contributions Tax-Sheltered (ACTS) program and the New Jersey State Employees Deferred Compensation Plan.
  • Chapter 113, P.L. 1997.  N.J.S.A. 43:3C-9.3 & 43:3C-9.4 permits higher annual compensation limits for members of TPAF, PERS, PFRS and ABP enrolled prior to July 1, 1996, if, prior to July 1, 1997, the employer certified to the Division Director that the employer will pay the additional cost for not applying the lower Code Sec. 401(a)(17) Annual Compensation Limit to these members.  If you are such an employer, you may report pensionable salary in excess of the Code Sec. 401(a)(17) limits mentioned earlier  for those employees in the affected class.
  • Defined contribution plans. The limitation on the annual additions to a participant's defined contribution account under Code Sec. 415(c)(1)(A) is increased from the lesser of $44,000 or 100% of the participant's compensation to the lesser of $45,000 or 100% of the participant's compensation.  Annual additions are the sum for any year of all employer and employee contributions to the defined contribution plan.  For purposes of applying the limitations all defined contribution plans of an employer are to be treated as one defined contribution plan.  Defined contribution plans include an employee annuity plan described in and an annuity contract described in section 403(b).  Defined contribution plans administered by the Division of Pensions and Benefits affected by this change include the SACT, ABP and ACTS programs and the New Jersey State Employees Deferred Compensation Plan.
  • Elective deferrals. The limitation under Code Sec. 402(g)(1) on the exclusion for elective deferrals described in Code Sec. 402(g)(3) increases from the lesser of $15,000 or 100% of the participant's compensation to the lesser of $15,500 or 100% of the participant's compensation.  Defined contribution plans administered by the Division of Pensions and Benefits affected by this change include the SACT, ABP and ACTS programs.
  • Deferred compensation plans. The limit on deferrals under Code Sec. 457(e)(15) concerning deferred compensation plans of state and local governments and tax-exempt organizations is increased from the lesser of $15,000 or 100% of the participant's compensation to the lesser of $15,500 or 100% of the participant's compensation.  The deferred compensation plan administered by the Division of Pensions and Benefits affected by this change is the New Jersey State Employees Deferred Compensation Plan and is available to Employees of the State and other State chartered commissions, authorities and boards.   Other governmental employers in the State my offer similar, self-administered programs.

The following limit is unchanged:

  • Catch-up contributions. The dollar limit under Code Sec. 414(v)(2)(B)(i) for catch-up contributions to an applicable employer plan other than a plan described in Code Sec. 401(k)(11) or Code Sec. 408(p) for individuals aged 50 or over remains at $5,000.  Defined contribution plans administered by the Division of Pensions and Benefits affected by this change include the SACT, ABP and ACTS programs.

CO Letter in Printable Format Adobe PDF (58K)


December 2006

TO: Certifying Officer - Autonomous State College /University/State Employers
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Report of Contributions, 4th Quarter 2006 (October 1st to December 31st)

Notice To Delinquent Report Of Contribution Filers

In the past I have written explaining the importance of all employers providing to the Division of Pensions and Benefits their quarterly Report of Contributions (ROC) in a timely fashion.  As stated in the past, delays in receiving these reports affect the timeliness of the Division providing services to ALL pension plan members, not just your employees and retirees. Unfortunately, we continue to experience delays associated to employer late reporting.  I must again ask for your help in avoiding these delays at all costs and remind you that the Division will utilize everything at its disposal in order to solicit timely reporting by the employers we work with to provide benefit services to the State’s public employees.

Reporting And Payment Information

Your 4th quarter 2006 tape ROC applicable to the Teachers’ Pension and Annuity Fund, Public Employees’ Retirement System, and Police and Firemen’s Retirement System is due by January 10, 2007 Your December, 2006 transmittal remittance, which represents the deductions due for the balance of the quarter, should be made through the Transmittal Electronic Payments System (TEPS).  The portion of the remittance for total pension deductions should reflect the sum of normal pension contributions, back deductions, loan payments, and arrears/purchase deductions.  Your TEPS remittance is also due by January 10, 2007.

With the tape ROC, you must complete and return the Transmittal Summary form for the 4th quarter 2006.  This document is used to assist your office and this Division in reconciling your transmittal remittances to the quarterly ROC.  The Control and Certification form must also accompany your quarterly tape ROC.  This is essential as it attests to the accuracy and validity of the submitted documentation.

If your quarterly ROC and total contributions are not received in a timely manner, we cannot update the pension accounts of your employees.  This may adversely affect any claim for benefits, including loan applications, filed by your employees.  Also, any delay affects our scheduling in posting contributions to all members’ accounts as well as the mailing of ROC for the following quarter.  A tape ROC will be considered received when it is submitted in an acceptable format, passes all data processing edits, and can be used to update members’ accounts.  Interest will be assessed, as prescribed by statute and administrative code, when monthly transmittal remittances and the quarterly ROC are not received within fifteen days of the due dates.

Should you have any questions or need assistance in completing the Report, please refer to http://www.state.nj.us/treasury/pensions/epbam/finance/roc.htm.

SACT Tax-Sheltered Annuity – Remittance Of 403(b) Contributions

Chapter 247, P.L. 1999 requires 403(b) salary reductions on behalf of an employee to be transmitted and credited within five business days from the pay date.

Members of the Public Employees’ Retirement System, Teachers’ Pension and Annuity Fund and Police and Firemen’s Retirement System in the Supplemental Annuity (SACT) Tax Sheltered Annuity Program are required to have 403(b) salary reductions remitted to the Division of Pensions and Benefits within the timeframes prescribed by law.  Contributions for these members will be made through the Transmittal Electronic Payments System (TEPS).
Please note that the full quarterly SUPPLEMENTAL ANNUITY contribution must be submitted prior to the processing of your ROC. If the full contribution is not submitted, it may be necessary to refund any supplemental annuity contributions sent in for the quarter. This could adversely affect your employees’ retirement savings.

TEPS – Transmittal Shortage Payments

The Division sends transmittal shortage statements when the sum of the transmittal remittances does not equal the due figure on the quarterly ROC.  Transmittal shortage statement payments can only be paid through TEPS.  Checks received for payment of transmittal shortages will be returned.  If you have questions related to TEPS, contact the TEPS Helpline at (888) 835-3345 or FAX your inquiries to the Audit/Billing Section at (609) 633-1708.

Changing Banking Information For TEPS

Notice of Changes for TEPS should be submitted to the Division of Pensions and Benefits on or after the date that the new checking account becomes effective.  Every Notice of Change is verified to ensure that the Division has the correct banking information.  This normally takes 12 to 15 days.

Statements Of Overages / Shortages

Overage and shortage statements, which affect a member’s Annuity Savings Fund, identify whether or not the pension contributions are subject to the 414(h) provision. These statements should be reviewed to determine when adjustments are required to your payroll records in calculating year-to-date mandatory pension contributions under 414(h).  Please note that all member shortages are to be paid by separate check. Do not remit through TEPS.

Most Retirement Plan Limits Increase for 2007

IRS has announced the 2007 cost-of-living adjustments (COLAs) for retirement plans. Many of the limits applicable to pension, and other retirement plans, increase for 2007.

The following plan limits are increased for inflation effective January 1, 2007:

  • Annual compensation limit. The maximum amount of annual compensation that can be taken into account for various qualified plan purposes, under Code Sec. 401(a)(17), is increased from $220,000 to $225,000.  Retirement plans administered by the Division of Pensions and Benefits affected by this change include the Teachers' Pension and Annuity Fund (TPAF), the Judicial Retirement System (JRS), the Public Employees' Retirement System (PERS), the Police and Firemen's Retirement System (PFRS), the State Police Retirement System (SPRS), the Supplemental Annuity Collective Trust (SACT), the Alternate Benefit Program (ABP), the Additional Contributions Tax-Sheltered (ACTS) program and the New Jersey State Employees Deferred Compensation Plan.
  • Chapter 113, P.L. 1997.  N.J.S.A. 43:3C-9.3 & 43:3C-9.4 permits higher annual compensation limits for members of TPAF, JRS, PERS, PFRS, SPRS and ABP enrolled prior to July 1, 1996, if, prior to July 1, 1997, the employer certified to the Division Director that the employer will pay the additional cost for not applying the lower Code Sec. 401(a)(17) Annual Compensation Limit to these members.  If you are such an employer, you may report pensionable salary in excess of the Code Sec. 401(a)(17) limits mentioned earlier  for those employees in the affected class.
  • Defined contribution plans. The limitation on the annual additions to a participant's defined contribution account under Code Sec. 415(c)(1)(A) is increased from the lesser of $44,000 or 100% of the participant's compensation to the lesser of $45,000 or 100% of the participant's compensation.  Annual additions are the sum for any year of all employer and employee contributions to the defined contribution plan.  For purposes of applying the limitations all defined contribution plans of an employer are to be treated as one defined contribution plan.  Defined contribution plans include an employee annuity plan described in and an annuity contract described in section 403(b).  Defined contribution plans administered by the Division of Pensions and Benefits affected by this change include the SACT, ABP and ACTS programs and the New Jersey State Employees Deferred Compensation Plan.
  • Elective deferrals. The limitation under Code Sec. 402(g)(1) on the exclusion for elective deferrals described in Code Sec. 402(g)(3) increases from the lesser of $15,000 or 100% of the participant's compensation to the lesser of $15,500 or 100% of the participant's compensation.  Defined contribution plans administered by the Division of Pensions and Benefits affected by this change include the SACT, ABP and ACTS programs.
  • Deferred compensation plans. The limit on deferrals under Code Sec. 457(e)(15) concerning deferred compensation plans of state and local governments and tax-exempt organizations is increased from the lesser of $15,000 or 100% of the participant's compensation to the lesser of $15,500 or 100% of the participant's compensation.  The deferred compensation plan administered by the Division of Pensions and Benefits affected by this change is the New Jersey State Employees Deferred Compensation Plan and is available to Employees of the State and other State chartered commissions, authorities and boards.

The following limit is unchanged:

  • Catch-up contributions. The dollar limit under Code Sec. 414(v)(2)(B)(i) for catch-up contributions to an applicable employer plan other than a plan described in Code Sec. 401(k)(11) or Code Sec. 408(p) for individuals aged 50 or over remains at $5,000.  Defined contribution plans administered by the Division of Pensions and Benefits affected by this change include the SACT, ABP and ACTS programs.

CO Letter in Printable Format Adobe PDF (60K)


September 2006

TO: State Departmental Certifying Officers
State Human Resources Directors
State Biweekly Human Resources Representatives
FROM: New Jersey State Health Benefits Program
SUBJECT: SHBP Open Enrollment 2006 State Biweekly Employers

The State Health Benefits Program (SHBP) Open Enrollment period for all State employees will begin on October 1, 2006 and end on October 31, 2006.  All changes to coverage made during this open enrollment will be effective on January 6, 2007 for State biweekly employees paid through the State Centralized Payroll Unit.

Completed employer-certified health benefit and/or dental applications should be forwarded to the Health Benefits Bureau as soon as they are received from employees. The last day that certified applications may arrive at the Health Benefits Bureau to be effective for the start of the new plan year is November 6, 2006.

In keeping with its current policy, the SHBP will not provide health fairs during this years open enrollment period. 

RATES FOR 2007

The State Health Benefits Commission has approved new health, dental, and prescription drug plan rates for the 2007 plan year. These rates are based upon the recommendation of the Commissions actuarial consultant, Aon Consulting.  Since the SHBP self-funds all of its medical plans, the claims experience used in projecting 2007 costs are based upon the actual claims experience of the group.

Effective January 6, 2007, SHBP plan rates for the State Active Group, will see the following percentage of change:

PLAN TYPE
RATE INCREASE/DECREASE
NJ PLUS 7.6%
Traditional Plan 21.6%
HMO Plans (Composite Change) 11.5%
Prescription Drug Plan – 4.2%
Dental Provider Organization (DPO) Plans 0%
(Aetna 2.5%   Horizon  5.5%)
Dental Expense Plan 0%

PREMIUM SHARING

The premium share arrangements remain unchanged. For those employees subject to premium sharing:

  • There is no premium cost to any employee who enrolls in NJ PLUS.

  • Employees will pay 5% of the premium cost if enrolled in an HMO.

  • Employees will pay 25% of the premium cost if eligible and enrolled in the Traditional Plan.

These percentages apply regardless of salary level or date of hire. 

COPAYMENT AMOUNTS FOR 2007

SHBP medical and prescription drug plan copayments for State Active Group members remain unchanged for the 2007 plan year and are listed below. 

  • For NJ PLUS and all HMOs (Aetna, AmeriHealth, CIGNA, Health Net and Oxford), the copayment for primary doctor visits and visits to a specialist is $10. This copayment amount will also apply to State Retiree Group members effective January 1, 2007.

  • The copayments for State Active Group members enrolled in the SHBP Employee Prescription Drug Plan for each 30 day supply purchased at a retail pharmacy are $3 for generic drugs and $10 for brand name prescription drugs. Mail order copayments for up to a 90-day supply are $5 for generic drugs and $15 for brand name prescription drugs.

MEDICAL AND PRESCRIPTION DRUG PLAN CHANGES

The plan changes that will effect State Active Group members are as follows:

  • Extended Coverage for Over Age Children to Age 30 During the Open Enrollment period and under the provisions of Chapter 375, P.L. 2005 certain over age children may elect coverage with the SHBP from the time their dependent coverage eligibility would normally end until their 30th birthday.

An over age child by blood or by law must meet all of the eligibility requirements outlined as follows:

  1. Be less than 30 years of age;
  2. Be unmarried;
  3. Have no dependent(s) of his or her own;
  4. Be a resident of New Jersey or enrolled as a full-time student at an accredited public or private institution of higher education; and
  5. Have no other coverage as a named subscriber, insured, enrollee, or covered person under any other group or individual health benefits plan, church plan, or health benefits plan, or entitled to benefits under Medicare.

The SHBP covered parent is responsible for the full cost of this extended coverage and will be billed on a monthly basis.

For more information see Fact Sheet #74, SHBP Coverage for Over Age Children to Age 30Adobe PDF (31K), which, along with the Chapter 375 Enrollment Application Adobe PDF (121K), is available on our Web site at: www.state.nj.us/treasury/pensions/shbp.htm or by calling the Division of Pensions and Benefits.

  • Elimination of Duplicate Coverage At a special meeting of the State Health Benefits Commission on September 5, 2006, the Commission approved the publication of a proposed change to the New Jersey Administrative Code to prohibit duplicate health coverage under the State Health Benefits Program (SHBP). There will be a 60-day period for public comment.

If the Commission approves the rule change following the public comment period, an individual covered under the SHBP will be permitted to have coverage as a member or a dependent, but not as both. For example, if a husband and wife are both eligible for coverage under the SHBP as employees, each may elect single coverage or one may elect member/spouse coverage (covering the spouse as a dependent) provided that the spouse does not elect his or her own SHBP coverage. Qualified dependent children are only eligible for coverage under one parent.

If approved, employees who are covered under the SHBP as an employee and a dependant can expect to receive notification from the SHBP that they must terminate one of the coverages. The effective date of coverage termination will be in early 2007.

  • Employers should also remember that new State employees hired on or after July 1, 2003 and eligible for enrollment in the SHBP, are not eligible for coverage under the SHBP Traditional Plan. Ineligible employees include State employees as determined by union contract and all non-aligned State employees as provided under Chapter 119, P.L. 2003.

Employees who are not eligible for the Traditional Plan can choose from among the six other plans offered by the SHBP such as NJ PLUS or one of the five HMOs: Aetna, AmeriHealth, CIGNA HealthCare, Health Net, and Oxford.

  • Employees who are newly married, or enrolling in the SHBP for the first time during the Open Enrollment, and are enrolling theirspouse as a dependent are required to provide a copy of the marriage certificate at the time of enrollment.  Similarly, if an employee is enrolling an eligible domestic partner as a dependent, a copy of the NJ Certificate of Domestic Partnership is required at the time of enrollment.  To ensure that the documentation submitted is properly matched to the employees record, the Health Benefits Bureau is requesting that employers provide the employees Social Security number on the copy of the marriage/partnership documentation.

RETIREE PRESCRIPTION DRUG PLAN INFORMATION

In accordance with the provisions of the Retiree Prescription Drug Plan under NJ PLUS and the Traditional Plan, effective January 1, 2007, retail pharmacy copayments for a 30-day supply will increase to $8 for generic drugs; $17 for preferred brand name drugs; and $34 for all other brand name prescription drugs. The mail order copayments for a 90-day supply will increase to $8 for generic drugs, $25 for preferred brand name drugs, and $42 for all other brand name prescription drugs. Effective January 1, 2007, the annual maximum out-of-pocket for prescription drug copayments is $1,082 per person. Once a person has paid $1,082 in copayments, that person is no longer required to pay any prescription drug copayments for the remainder of that calendar year.

OPEN ENROLLMENT INFORMATIONAL MATERIALS

MILESTONES Enclosed is a milestone chart that lists the critical dates of the open enrollment period and outlines the efforts being made to educate employees. Please use this chart as a checklist to guide your activities during open enrollment.

RATE CHARTS Enclosed you will find rate charts for your use, as well as a sample open enrollment announcement flier that provides a list of medical and dental plans and the premium sharing costs for your employees. This flier is designed to assist your employees in making informed decisions concerning their health care coverage during this open enrollment period. 

On September 22, theopen enrollment announcement flier will be distributed with paychecks to all employees paid through the States Centralized Payroll Unit.

HEALTH CAPSULE The Health Capsule newsletter announces the SHBP Open Enrollment Period to employees and presents important information and changes that may affect their benefit selection.  A sample is enclosed for your review.

On September 22, the Health Capsule newsletter will be distributed with paychecks to all employees paid through the States Centralized Payroll Unit.

HEALTH PLAN CONTACTS Also included in this mailing is a listing of marketing contacts for the various health and dental plans. Use these contacts to obtain provider directories or other plan specific literature. (These telephone numbers are not for member services. Please do not give these telephone numbers to your employees.

HEALTH AND DENTAL PLAN APPLICATIONS As a result of last years expansion of the SHBP Dental Plans to local government and educational employers, the Health Benefits Bureau has two separate applications: one application is for enrolling into the health plans (including prescription drug coverage) and the other application is for enrolling into the Employee Dental Plans.  The health benefit application has been recently revised and a copy is attached.  Please check that you are using the newest versions. The health and dental applications are available for download from the SHBP home page at: www.state.nj.us/treasury pensions/shbp.htm

HEALTH PLAN COMPARISON SUMMARY CHART With the changes to Local Group and Retiree copayments, the SHBP is again able to produce a single Plan Comparison Summary charts for State employees, Local/Educational employees, and all Retirees (State and Local/Educational). The comparison charts are currently being printed and copies will be shipped to employers as soon as they are available.

SUMMARY PROGRAM DESCRIPTION (SPD) BOOKLET The SHBP Summary Program Description has been revised for the 2007 plan year.  The booklet is currently being printed and copies will be shipped as soon as they are available.  The SPD is currently available for viewing over the Internet at: www.state.nj.us/treasury/pensions/shbp.htm

PLAN HANDBOOKS The SHBPs member handbooks for the Traditional Plan, NJ PLUS, and the Employee Prescription Drug Plan are being revised for the 2007 plan year and will be available early in 2007.  HMO handbooks are also being prepared by the individual HMOs for distribution.  The SHBP Dental Plans was revised for the 2006 plan year and can continue to be used for the 2007 plan year.

ONLINE INFORMATION

The SHBPs plan comparisons, member handbooks, newsletters, and rate information are available over the Internet at the State Health Benefits Program home page: www.state.nj.us/treasury/pensions/shbp.htm   

Web-based presentations on the SHBP Open Enrollment Period will also be available for both employers and employees during the open enrollment period.  Once open enrollment begins you will find the link on the SHBP home page.

Participating provider information for all SHBP medical plans is available in the Unified Provider Directory (UPD).  The UPD is an online service that provides a comprehensive listing of health care providers and facilities that deliver their services through one or more of the SHBPs health care plans.  Updated monthly, you can access the UPD through the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm  

TAX$AVE

The State Employees Tax Savings Program (Tax$ave) Open Enrollment Period runs concurrent with the SHBP Open Enrollment Period (October 1 – October 31, 2006). Tax$ave is a benefit program available to full-time State employees who are eligible for the SHBP.  Tax$ave can save your employees tax money by paying health and dental benefit premiums and eligible unreimbursed medical and/or dependent care expenses from before-tax dollars.  See the Tax$ave Open Enrollment materials for more information. 

Internal Revenue Service (IRS) rules require that for an employee covered by the Premium Option Plan, payroll deductions for health and dental plan benefits remain the same for the entire plan year.  Therefore, no coverage level changes can be made which result in a change in the amount of an employees health and/or dental plan deduction unless a Qualifying Event has occurred.

FSA Claim Period Extended Any balance remaining in a Tax$ave Flexible Spending Account (FSA) the Unreimbursed Medical Spending Account or the Dependent Care Spending Account as of December 31, can now be used for eligible expenses incurred from January 1 through March 15 of the following year.  The period that employees enrolled in a Tax$ave FSA have for submitting claims for reimbursement has been extended to April 30 of the following year.  While this does not eliminate the use-it-or-lose-it rule completely, employees now have a longer period to obtain covered services and avoid forfeiting unused funds.  See the Tax$ave Open Enrollment announcement letter or the Tax$ave 2007 newsletter for details.

Tax$ave and Domestic Partners SHBP members need to be aware of the possible federal tax implications of adding a domestic partner to SHBP benefits. Since the federal tax code does not view domestic partners in the same manner as spouses, an employer may have to treat the domestic partner SHBP benefit as taxable to the employee and withhold federal income, Social Security, and Medicare taxes on its value. Similarly, since the domestic partner's coverage is a federally taxable benefit, an employee who participates in the Tax$ave Premium Option Plan cannot make pre-tax payments for the cost of a domestic partner's coverage. Pre-tax dollars may still be used to pay for the employee's portion of the cost of his or her own and dependent children's coverage. If an employee wants to claim a federal tax dependency exemption for a domestic partner, he or she should contact the Internal Revenue Service or see IRS Tax Topic 354 Dependents for more details.

ADDITIONAL INFORMATION

If you have any questions about the SHBP Open Enrollment Period or the information in this letter, please contact our Office of Client Services at (609) 292-7524 to speak with an Employer Group representative. 

Thank you for your assistance in making the SHBP Open Enrollment Period a success for your employees.

Enclosures:
2006 SHBP Open Enrollment Milestone Chart
Health and Dental Plan Rate Charts/Fliers
Health Capsule Newsletter
Health/Dental Plan Marketing Contacts

CO Letter in Printable Format - Includes the above enclosures - Adobe PDF (566K)


September 2006

TO: State Biweekly Benefits Administrators
State Monthly Benefits Administrators
County Community College Benefits Administrators
FROM: New Jersey State Health Benefits Program
SUBJECT: SHBP Open Enrollment 2006 – Part-Time Employees

The State Health Benefits Program (SHBP) Open Enrollment Period for all eligible part-time employees of the State and part-time faculty at institutions of higher education will be held from October 1, 2006 through October 31, 2006. 

These eligible part-time employees may elect to enroll for benefits under NJ PLUS and the Employee Prescription Drug Plan if they did not do so when first eligible.  They may also add any eligible dependents they have not previously.  Enrollments or changes to coverage level made during this open enrollment will be effective on January 1, 2007 for part-time employees. 

SHBP APPLICATIONS Completed employer-certified SHBP Part-time Employee Group Applications should be sent to the Health Benefits Bureau as soon as they are received from employees.  Please write the words, Open Enrollment”, on the top of the application to help expedite their processing. The last day that certified applications may arrive at the Health Benefits Bureau to be effective for the start of the new plan year is November 6, 2006.

RATE CHARTS Enclosed you will find Part-time Active and Part-time COBRA Group rates for NJ PLUS and the Employee Prescription Drug Plan. 

MORE INFORMATION AVAILABLE ONLINE The SHBPs member handbooks, newsletters, and rate information are available over the Internet at the State Health Benefits Program home page: www.state.nj.us/treasury/pensions/shbp.htm 
Participating provider information for NJ PLUS is available in the Unified Provider Directory (UPD).  The UPD is an online service that provides a comprehensive listing of health care providers and facilities that deliver their services through one or more of the SHBPs health care plans.  Updated monthly, you can access the UPD through the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm

If you have any questions about the information in this letter, please contact our Office of Client Services at (609) 292-7524.

Thank you for your assistance in making the SHBP Open Enrollment Period a success for your employees.

Enclosures:
2007 SHBP Part-time Active and COBRA Rates

CO Letter in Printable Format - Includes the above enclosure - Adobe PDF (62K)


September 2006

TO: State Monthly Certifying Officers
State Monthly Human Resources Representatives
FROM: New Jersey State Health Benefits Program
SUBJECT: SHBP Open Enrollment 2006 State Monthly Employers

The State Health Benefits Program (SHBP) Open Enrollment period for all State employees will begin on October 1, 2006 and end on October 31, 2006.  All changes to coverage made during this open enrollment will be effective on January 1, 2007 for employees of State universities, State colleges, and State authorities.

Completed employer-certified health benefit and/or dental applications should be forwarded to the Health Benefits Bureau as soon as they are received from employees. The last day that certified applications may arrive at the Health Benefits Bureau to be effective for the start of the new plan year is November 6, 2006.

In keeping with its current policy, the SHBP will not provide health fairs during this years open enrollment period. 

RATES FOR 2007

The State Health Benefits Commission has approved new health, dental, and prescription drug plan rates for the 2007 plan year. These rates are based upon the recommendation of the Commissions actuarial consultant, Aon Consulting.  Since the SHBP self-funds all of its medical plans, the claims experience used in projecting 2007 costs are based upon the actual claims experience of the group.

Effective January 1, 2007, SHBP plan rates for the State Active Group, will see the following percentage of change:

PLAN TYPE RATE INCREASE/DECREASE
NJ PLUS 7.6%
Traditional Plan 21.6%
HMO Plans (Composite Change) 11.5%
Prescription Drug Plan – 4.2%
Dental Provider Organization (DPO) Plans 0%
(Aetna 2.5%   Horizon  – 5.5%)
Dental Expense Plan 0%

PREMIUM SHARING

The premium share arrangements remain unchanged. For those employees subject to premium sharing:

  • There is no premium cost to any employee who enrolls in NJ PLUS. 

  • Employees will pay 5% of the premium cost if enrolled in an HMO.

  • Employees will pay 25% of the premium cost if eligible and enrolled in the Traditional Plan.

These percentages apply regardless of salary level or date of hire. 

COPAYMENT AMOUNTS FOR 2007

SHBP medical and prescription drug plan copayments for State Active Group members remain unchanged for the 2007 plan year and are listed below. 

  • For NJ PLUS and all HMOs (Aetna, AmeriHealth, CIGNA, Health Net and Oxford), the copayment for primary doctor visits and visits to a specialist is $10. This copayment amount will also apply to State Retiree Group members effective January 1, 2007.

  • The copayments for State Active Group members enrolled in the SHBP Employee Prescription Drug Plan for each 30 day supply purchased at a retail pharmacy are $3 for generic drugs and $10 for brand name prescription drugs. Mail order copayments for up to a 90-day supply are $5 for generic drugs and $15 for brand name prescription drugs.

MEDICAL AND PRESCRIPTION DRUG PLAN CHANGES

The plan changes that will effect State Active Group members are as follows:

  • Extended Coverage for Over Age Children to Age 30 During the Open Enrollment period and under the provisions of Chapter 375, P.L. 2005 certain over age children may elect coverage with the SHBP from the time their dependent coverage eligibility would normally end until their 30th birthday.

An over age child by blood or by law must meet all of the eligibility requirements outlined as follows:

  1. Be less than 30 years of age;
  2. Be unmarried;
  3. Have no dependent(s) of his or her own;
  4. Be a resident of New Jersey or enrolled as a full-time student at an accredited public or private institution of higher education; and
  5. Have no other coverage as a named subscriber, insured, enrollee, or covered person under any other group or individual health benefits plan, church plan, or health benefits plan, or entitled to benefits under Medicare.
    The SHBP covered parent is responsible for the full cost of this extended coverage and will be billed on a monthly basis.

For more information see Fact Sheet #74, SHBP Coverage for Over Age Children to Age 30Adobe PDF (31K), which, along with the Chapter 375 Enrollment Application Adobe PDF (121K), is available on our Web site at: www.state.nj.us/treasury/pensions/shbp.htm or by calling the Division of Pensions and Benefits.

  • Elimination of Duplicate Coverage At a special meeting of the State Health Benefits Commission on September 5, 2006, the Commission approved the publication of a proposed change to the New Jersey Administrative Code to prohibit duplicate health coverage under the State Health Benefits Program (SHBP). There will be a 60-day period for public comment.

If the Commission approves the rule change following the public comment period, an individual covered under the SHBP will be permitted to have coverage as a member or a dependent, but not as both. For example, if a husband and wife are both eligible for coverage under the SHBP as employees, each may elect single coverage or one may elect member/spouse coverage (covering the spouse as a dependent) provided that the spouse does not elect his or her own SHBP coverage. Qualified dependent children are only eligible for coverage under one parent.

If approved, employees who are covered under the SHBP as an employee and a dependant can expect to receive notification from the SHBP that they must terminate one of the coverages. The effective date of coverage termination will be in early 2007.

  • Employers should also remember that new State employees hired on or after July 1, 2003 and eligible for enrollment in the SHBP, are not eligible for coverage under the SHBP Traditional Plan. Ineligible employees include State employees as determined by union contract and all non-aligned State employees as provided under Chapter 119, P.L. 2003.

Employees who are not eligible for the Traditional Plan can choose from among the six other plans offered by the SHBP such as NJ PLUS or one of the five HMOs: Aetna, AmeriHealth, CIGNA HealthCare, Health Net, and Oxford.

  • Employees who are newly married, or enrolling in the SHBP for the first time during the Open Enrollment, and are enrolling theirspouse as a dependent are required to provide a copy of the marriage certificate at the time of enrollment.  Similarly, if an employee is enrolling an eligible domestic partner as a dependent, a copy of the NJ Certificate of Domestic Partnership is required at the time of enrollment.  To ensure that the documentation submitted is properly matched to the employees record, the Health Benefits Bureau is requesting that employers provide the employees Social Security number on the copy of the marriage/partnership documentation.

RETIREE PRESCRIPTION DRUG PLAN INFORMATION

In accordance with the provisions of the Retiree Prescription Drug Plan under NJ PLUS and the Traditional Plan, effective January 1, 2007, retail pharmacy copayments for a 30-day supply will increase to $8 for generic drugs; $17 for preferred brand name drugs; and $34 for all other brand name prescription drugs. The mail order copayments for a 90-day supply will increase to $8 for generic drugs, $25 for preferred brand name drugs, and $42 for all other brand name prescription drugs. Effective January 1, 2007, the annual maximum out-of-pocket for prescription drug copayments is $1,082 per person. Once a person has paid $1,082 in copayments, that person is no longer required to pay any prescription drug copayments for the remainder of that calendar year.

OPEN ENROLLMENT INFORMATIONAL MATERIALS/MILESTONES Enclosed is a milestone chart that lists the critical dates of the open enrollment period and outlines the efforts being made to educate employees. Please use this chart as a checklist to guide your activities during open enrollment.

RATE CHARTS Enclosed you will find rate charts for your use, as well as sample open enrollment announcement fliers that provide a list of medical and dental plans and the premium sharing costs for State employees. These fliers are master copies that can be reproduced for distribution to your employees. The fliers are provided for three different payroll schedules (Monthly, 24 Pay Periods, and 26 Pay Periods). Choose the flier that corresponds to your payroll schedule.

These rate fliers are designed to assist your employees in making informed decisions concerning their health and dental care.  Please distribute them to your employees prior to the start of the Open Enrollment.

HEALTH CAPSULE The Health Capsule newsletter announces the SHBP Open Enrollment Period to employees and presents important information and changes that may affect their benefit selection.  A sample is enclosed for your review.  The newsletters are scheduled for delivery to monthly employers in late-September.  Please distribute them to your employees for the open enrollment. 

HEALTH PLAN CONTACTS Also included in this mailing is a listing of marketing contacts for the various health and dental plans. Use these contacts to obtain provider directories or other plan specific literature. (These telephone numbers are not for member services. Please do not give these telephone numbers to your employees.)

HEALTH AND DENTAL PLAN APPLICATIONS As a result of last years expansion of the SHBP Dental Plans to local government and educational employers, the Health Benefits Bureau has two separate applications: one application is for enrolling into the health plans (including prescription drug coverage) and the other application is for enrolling into the Employee Dental Plans.  The health benefit application has been recently revised and a copy is attached.  Please check that you are using the newest versions. The health and dental applications are available for download from the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm

HEALTH PLAN COMPARISON SUMMARY CHART With the changes to Local Group and Retiree copayments, the SHBP is again able to produce a single Plan Comparison Summary charts for State employees, Local/Educational employees, and all Retirees (State and Local/Educational). The comparison charts are currently being printed and copies will be shipped to employers as soon as they are available.

SUMMARY PROGRAM DESCRIPTION (SPD) BOOKLET The SHBP Summary Program Description has been revised for the 2007 plan year.  The booklet is currently being printed and copies will be shipped as soon as they are available.  The SPD is currently available for viewing over the Internet at: www.state.nj.us/treasury/pensions/shbp.htm

PLAN HANDBOOKS The SHBPs member handbooks for the Traditional Plan, NJ PLUS, and the Employee Prescription Drug Plan are being revised for the 2007 plan year and will be available early in 2007.  HMO handbooks are also being prepared by the individual HMOs for distribution. The SHBP Dental Plans was revised for the 2006 plan year and can continue to be used for the 2007 plan year.

ONLINE INFORMATION

The SHBPs plan comparisons, member handbooks, newsletters, and rate information are available over the Internet at the State Health Benefits Program home page: www.state.nj.us/treasury/pensions/shbp.htm  

Web-based presentations on the SHBP Open Enrollment Period will also be available for both employers and employees during the open enrollment period.  Once open enrollment begins you will find the link on the SHBP home page.Participating provider information for all SHBP medical plans is available in the Unified Provider Directory (UPD).  The UPD is an online service that provides a comprehensive listing of health care providers and facilities that deliver their services through one or more of the SHBPs health care plans.  Updated monthly, you can access the UPD through the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm  

TAX$AVE

The State Employees Tax Savings Program (Tax$ave) Open Enrollment Period runs concurrent with the SHBP Open Enrollment Period (October 1 – October 31, 2006). Tax$ave is a benefit program available to full-time State employees who are eligible for the SHBP. Tax$ave can save your employees tax money by paying health and dental benefit premiums and eligible unreimbursed medical and/or dependent care expenses from before-tax dollars. See the Tax$ave Open Enrollment materials for more information.  Internal Revenue Service (IRS) rules require that for an employee covered by the Premium Option Plan, payroll deductions for health and dental plan benefits remain the same for the entire plan year.  Therefore, no coverage level changes can be made which result in a change in the amount of an employees health and/or dental plan deduction unless a Qualifying Event has occurred.

FSA Claim Period Extended Any balance remaining in a Tax$ave Flexible Spending Account (FSA) the Unreimbursed Medical Spending Account or the Dependent Care Spending Account as of December 31, can now be used for eligible expenses incurred from January 1 through March 15 of the following year.  The period that employees enrolled in a Tax$ave FSA have for submitting claims for reimbursement has been extended to April 30 of the following year.  While this does not eliminate the use-it-or-lose-it rule completely, employees now have a longer period to obtain covered services and avoid forfeiting unused funds.  See the Tax$ave Open Enrollment announcement letter or the Tax$ave 2007 newsletter for details.

Tax$ave and Domestic Partners SHBP members need to be aware of the possible federal tax implications of adding a domestic partner to SHBP benefits. Since the federal tax code does not view domestic partners in the same manner as spouses, an employer may have to treat the domestic partner SHBP benefit as taxable to the employee and withhold federal income, Social Security, and Medicare taxes on its value. Similarly, since the domestic partner's coverage is a federally taxable benefit, an employee who participates in the Tax$ave Premium Option Plan cannot make pre-tax payments for the cost of a domestic partner's coverage. Pre-tax dollars may still be used to pay for the employee's portion of the cost of his or her own and dependent children's coverage. If an employee wants to claim a federal tax dependency exemption for a domestic partner, he or she should contact the Internal Revenue Service or see IRS Tax Topic 354 Dependents for more details.

ADDITIONAL INFORMATION

If you have any questions about the SHBP Open Enrollment Period or the information in this letter, please contact our Office of Client Services at (609) 292-7524 to speak with an Employer Group representative. 

Thank you for your assistance in making the SHBP Open Enrollment Period a success for your employees.

Enclosures:
2006 SHBP Open Enrollment Milestone Chart
Health and Dental Plan Rate Charts/Fliers
Health Capsule Newsletter
Health/Dental Plan Marketing Contacts

CO Letter in Printable Format - Includes the above enclosures - Adobe PDF (929K)


September 2006

TO: State Health Benefits Program Participating Local Government Employers
FROM: New Jersey State Health Benefits Program
SUBJECT: SHBP Open Enrollment 2006 Local Government Employers

The State Health Benefits Program (SHBP) Open Enrollment Period for local government employees will begin on October 1, 2006 and end on October 31, 2006.  All changes to coverage made during this open enrollment will be effective on January 1, 2007.Completed employer-certified health benefit and/or dental applications should be forwarded to the Health Benefits Bureau as soon as they are received from employees. The last day that certified applications may arrive at the Health Benefits Bureau to be effective for the start of the new plan year is November 6, 2006. In keeping with its current policy, the SHBP will not provide health fairs during this years open enrollment period. 

RATES FOR 2007

The State Health Benefits Commission has approved new health and prescription drug plan rates for the 2007 plan year. These rates are based upon the recommendation of the Commissions actuarial consultant, Aon Consulting.  Since the SHBP self-funds all of its medical plans, the claims experience used in projecting 2007 costs are based upon the actual claims experience of the group.  Effective January 1, 2007, SHBP plan rates for the Local Government Active Group will see the following percentage of change:

  NJ PLUS
Traditional Plan
HMO Plans
(Composite Change)
Employee Prescription Drug Plan Dental Expense Plan Dental Plan Organizations (DPO)
Local Government Employers with Separate Rx Coverage
6.3%

17.2%
5.2% – 8.1% 0% 0%
(Aetna 2.5%
Horizon –5.3%)
Local Government Employers without Separate Rx Coverage
6.3%

17.2%
5.2% – 8.1% 0% 0%
(Aetna 2.5%
Horizon –5.3%)

NEW COPAYMENT AMOUNTS FOR 2007

The State Health Benefits Commission has approved new medical and prescription drug plan copayments amounts for Local Government Active Group members as well as for all retirees.  The new copayments are listed below become effective January 1, 2007.

  • For NJ PLUS and all HMOs (Aetna, AmeriHealth, CIGNA, Health Net and Oxford), the copayment for primary doctor visits and visits to a specialist will be $10. The copayments for Local Government Active Group members enrolled in the SHBP Employee Prescription Drug Plan for each 30 day supply purchased at a retail pharmacy will be $3 for generic drugs and $10 for brand name prescription drugs. Mail order copayments for up to a 90-day supply will be $5 for generic drugs and $15 for brand name prescription drugs.
  • For Retirees in the Retiree Prescription Drug Plan under NJ PLUS and the Traditional Plan, effective January 1, 2007, retail pharmacy copayments for a 30-day supply will increase to $8 for generic drugs; $17 for preferred brand name drugs; and $34 for all other brand name prescription drugs. The mail order copayments for a 90-day supply will increase to $8 for generic drugs, $25 for preferred brand name drugs, and $42 for all other brand name prescription drugs. Effective January 1, 2007, the annual maximum out-of-pocket for prescription drug copayments is $1,082 per person. Once a person has paid $1,082 in copayments, that person is no longer required to pay any prescription drug copayments for the remainder of that calendar year.

MEDICAL AND PRESCRIPTION DRUG PLAN CHANGES

The plan changes that will effect Local Government Active Group members are as follows:

  • EXTENDED COVERAGE FOR OVER AGE CHILDREN TO AGE 30 During the Open Enrollment period and under the provisions of Chapter 375, P.L. 2005 certain over age children may elect coverage with the SHBP from the time their dependent coverage eligibility would normally end until their 30th birthday.

An over age child by blood or by law must meet all of the eligibility requirements outlined as follows:

  1. Be less than 30 years of age;Be unmarried;Have no dependent(s) of his or her own;Be a resident of New Jersey or enrolled as a full-time student at an accredited public or private institution of higher education; and
  2. Have no other coverage as a named subscriber, insured, enrollee, or covered person under any other group or individual health benefits plan, church plan, or health benefits plan, or entitled to benefits under Medicare.

The SHBP covered parent is responsible for the full cost of this extended coverage and will be billed on a monthly basis.

For more information see Fact Sheet #74, SHBP Coverage for Over Age Children to
Age 30 Adobe PDF (31K),
which is available on our Web site at: www.state.nj.us/treasury/pensions/shbp.htm or by calling the Division of Pensions and Benefits.

  • ELIMINATION OF DUPLICATE COVERAGE At a special meeting of the State Health Benefits Commission on September 5, 2006, the Commission approved the publication of a proposed change to the New Jersey Administrative Code to prohibit duplicate health coverage under the State Health Benefits Program (SHBP). There will be a 60-day period for public comment.

If the Commission approves the rule change following the public comment period, an individual covered under the SHBP will be permitted to have coverage as member or a dependent, but not as both. For example, if a husband and wife are both eligible for coverage under the SHBP as employees, each may elect single coverage or one may elect member/spouse coverage (covering the spouse as a dependent) provided that the spouse does not elect his or her own SHBP coverage. Qualified dependent children are only eligible for coverage under one parent.

If approved, employees who are covered under the SHBP as an employee and a dependant can expect to receive notification from the SHBP that they must terminate one of the coverages. The effective date of coverage termination will be in early 2007.

  • EMPLOYEE DENTAL PLANS – The SHBP Employee Dental Plans are available to participating local employers who adopt this benefit for their active employees and eligible dependents.  Employers and employees should see Fact Sheet #37, SHBP Employee Dental Plans Adobe PDF (44K), for a description of the plans and a chart outlining the benefits.
  • NEW SPOUSES AND DOMESTIC PARTNERS Employees who are newly married, or enrolling in the SHBP for the first time during the Open Enrollment, and are enrolling theirspouse as a dependent are required to provide a copy of the marriage certificate at the time of enrollment.  Similarly, if an employee is permitted by the employer to enroll an eligible domestic partner as a dependent, a copy of the NJ Certificate of Domestic Partnership is required at the time of enrollment.  To ensure that the documentation submitted is properly matched to the employees record, the Health Benefits Bureau is requesting that employers provide the employees Social Security number on the copy of the marriage/partnership documentation.

OPEN ENROLLMENT INFORMATIONAL MATERIALS

MILESTONES Enclosed is a milestone chart that lists the critical dates of the open enrollment period and outlines the efforts being made to educate employees. Please use this chart as a checklist to guide your activities during open enrollment.

RATE CHARTS Enclosed you will find approved rates for SHBP health and prescription drug plans. We have included rate charts for employers with and without prescription drug coverage. The listed rates are effective January 1, 2007 through December 31, 2007.

HEALTH CAPSULE The Health Capsule newsletter announces the SHBP Open Enrollment Period to employees and presents important information and changes that may affect their benefit selection.  The newsletter will be posted to the Divisions Web site and is scheduled for delivery to Local employers and as soon as printing is completed.  Please distribute them to your employees when received.

HEALTH PLAN CONTACTS Also included in this mailing is a listing of marketing contacts for the various health and dental plans. Use these contacts to obtain provider directories or other plan specific literature. (These telephone numbers are not for member services. Please do not give these telephone numbers to your employees.)

HEALTH AND DENTAL PLAN APPLICATIONS The State Health Benefits Program currently has two separate applications: one application is for enrolling into the health plans (including prescription drug coverage) and the other application is for enrolling into the Employee Dental Plans. The health plan application has been recently revised and a copy is attached.  Please check that you are using the newest versions. The health and dental applications are available for download from the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm

HEALTH PLAN COMPARISON SUMMARY CHART With the changes to Local Group and Retiree copayments, the SHBP is again able to produce a single Plan Comparison Summary charts for State employees, Local Government/Educational employees, and all Retirees (State and Local Government/Educational). The comparison charts are currently being printed and copies will be shipped to employers as soon as they are available.

SUMMARY PROGRAM DESCRIPTION (SPD) BOOKLET The SHBP Summary Program Description has been revised for the 2007 plan year.  The booklet is currently being printed and copies will be shipped as soon as they are available.  The SPD is currently available for viewing over the Internet at: www.state.nj.us/treasury/pensions/shbp.htm

PLAN HANDBOOKS The SHBPs member handbooks for the Traditional Plan, NJ PLUS, and the Employee Prescription Drug Plan are being revised for the 2007 plan year and will be available early in 2007.  HMO handbooks are also being prepared by the individual HMOs for distribution.  The SHBP Dental Plans was revised for the 2006 plan year and can continue to be used for the 2007 plan year.

ONLINE INFORMATION

The SHBPs plan comparisons, member handbooks, newsletters, and rate information are available over the Internet at the State Health Benefits Program home page: www.state.nj.us/treasury/pensions/shbp.htm 

Participating provider information for all SHBP medical plans is available in the Unified Provider Directory (UPD).  The UPD is an online service that provides a comprehensive listing of health care providers and facilities that deliver their services through one or more of the SHBPs health care plans.  Updated monthly, you can access the UPD through the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm

ADDITIONAL INFORMATION

If you have any questions about the SHBP Open Enrollment Period or the information in this letter, please contact our Office of Client Services at (609) 292-7524 to speak with an Employer Group representative. 

Thank you for your assistance in making the SHBP Open Enrollment Period a success for your employees.

Enclosure:
2006 SHBP Open Enrollment Milestone Chart
Health Plan Rate Charts
Health Capsule Newsletter
Health Plan Marketing Contacts

CO Letter in Printable Format - Includes the above enclosures - Adobe PDF (353K)


September 2006

TO: State Health Benefits Program Participating Local Education Employers
FROM: New Jersey State Health Benefits Program
SUBJECT: SHBP Open Enrollment 2006 Local Education Employers

The State Health Benefits Program (SHBP) Open Enrollment Period for local Board of Education employees will begin on October 1, 2006 and end on October 31, 2006.  All changes to coverage made during this open enrollment will be effective on January 1, 2007.Completed employer-certified health benefit and/or dental applications should be forwarded to the Health Benefits Bureau as soon as they are received from employees. The last day that certified applications may arrive at the Health Benefits Bureau to be effective for the start of the new plan year is November 6, 2006. In keeping with its current policy, the SHBP will not provide health fairs during this years open enrollment period. 

RATES FOR 2007

The State Health Benefits Commission has approved new health and prescription drug plan rates for the 2007 plan year. These rates are based upon the recommendation of the Commissions actuarial consultant, Aon Consulting.  Since the SHBP self-funds all of its medical plans, the claims experience used in projecting 2007 costs are based upon the actual claims experience of the group.  Effective January 1, 2007, SHBP plan rates for the Local Education Active Group will see the following percentage of change:

  NJ PLUS Traditional Plan HMO Plans
(Composite Change)
Employee Prescription Drug Plan Dental Expense Plan Dental Plan Organizations (DPO)
Local Education Employers with Separate Rx Coverage 5.1% 11.9% 5.2% – 8.1% 0% 0%
(Aetna 2.5%
Horizon –5.3%)
Local Education Employers without Separate Rx Coverage 5.1% 11.9% 5.2% – 8.1% 0% 0%
(Aetna 2.5%
Horizon –5.3%)

NEW COPAYMENT AMOUNTS FOR 2007

The State Health Benefits Commission has approved new medical and prescription drug plan copayments amounts for Local Education Active Group members as well as for all Retirees.  The new copayments are listed below become effective January 1, 2007.

  • For NJ PLUS and all HMOs (Aetna, AmeriHealth, CIGNA, Health Net and Oxford), the copayment for primary doctor visits and visits to a specialist will be $10. The copayments for Local Education Active Group members enrolled in the SHBP Employee Prescription Drug Plan for each 30 day supply purchased at a retail pharmacy will be $3 for generic drugs and $10 for brand name prescription drugs. Mail order copayments for up to a 90-day supply will be $5 for generic drugs and $15 for brand name prescription drugs.
  • For Retirees in the Retiree Prescription Drug Plan under NJ PLUS and the Traditional Plan, effective January 1, 2007, retail pharmacy copayments for a 30-day supply will increase to $8 for generic drugs; $17 for preferred brand name drugs; and $34 for all other brand name prescription drugs. The mail order copayments for a 90-day supply will increase to $8 for generic drugs, $25 for preferred brand name drugs, and $42 for all other brand name prescription drugs. Effective January 1, 2007, the annual maximum out-of-pocket for prescription drug copayments is $1,082 per person. Once a person has paid $1,082 in copayments, that person is no longer required to pay any prescription drug copayments for the remainder of that calendar year.

MEDICAL, DENTAL, AND PRESCRIPTION DRUG PLAN CHANGESThe plan changes that will effect Local Government Active Group members are as follows:

  • EXTENDED COVERAGE FOR OVER AGE CHILDREN TO AGE 30 During the Open Enrollment period and under the provisions of Chapter 375, P.L. 2005 certain over age children may elect coverage with the SHBP from the time their dependent coverage eligibility would normally end until their 30th birthday.

An over age child by blood or by law must meet all of the eligibility requirements outlined as follows:

  1. Be less than 30 years of age;Be unmarried;Have no dependent(s) of his or her own;Be a resident of New Jersey or enrolled as a full-time student at an accredited public or private institution of higher education; and

  2. Have no other coverage as a named subscriber, insured, enrollee, or covered person under any other group or individual health benefits plan, church plan, or health benefits plan, or entitled to benefits under Medicare.

The SHBP covered parent is responsible for the full cost of this extended coverage and will be billed on a monthly basis.

For more information see Fact Sheet #74, SHBP Coverage for Over Age Children to Age 30Adobe PDF (31K), which is available on our Web site at: www.state.nj.us/treasury/pensions/shbp.htm or by calling the Division of Pensions and Benefits.

  • ELIMINATION OF DUPLICATE COVERAGE At a special meeting of the State Health Benefits Commission on September 5, 2006, the Commission approved the publication of a proposed change to the New Jersey Administrative Code to prohibit duplicate health coverage under the State Health Benefits Program (SHBP). There will be a 60-day period for public comment.

If the Commission approves the rule change following the public comment period, an individual covered under the SHBP will be permitted to have coverage as member or a dependent, but not as both. For example, if a husband and wife are both eligible for coverage under the SHBP as employees, each may elect single coverage or one may elect member/spouse coverage (covering the spouse as a dependent) provided that the spouse does not elect his or her own SHBP coverage. Qualified dependent children are only eligible for coverage under one parent.

If approved, employees who are covered under the SHBP as an employee and a dependant can expect to receive notification from the SHBP that they must terminate one of the coverages. The effective date of coverage termination will be in early 2007.

  • EMPLOYEE DENTAL PLANS – The SHBP Employee Dental Plans are available to participating local employers who adopt this benefit for their active employees and eligible dependents.  Employers and employees should see Fact Sheet #37, SHBP Employee Dental Plans Adobe PDF (44K), for a description of the plans and a chart outlining the benefits.

  • NEW SPOUSES AND DOMESTIC PARTNERS Employees who are newly married, or enrolling in the SHBP for the first time during the Open Enrollment, and are enrolling theirspouse as a dependent are required to provide a copy of the marriage certificate at the time of enrollment.  Similarly, if an employee is permitted by the employer to enroll an eligible domestic partner as a dependent, a copy of the NJ Certificate of Domestic Partnership is required at the time of enrollment.  To ensure that the documentation submitted is properly matched to the employees record, the Health Benefits Bureau is requesting that employers provide the employees Social Security number on the copy of the marriage/partnership documentation.

OPEN ENROLLMENT INFORMATIONAL MATERIALS

MILESTONES Enclosed is a milestone chart that lists the critical dates of the open enrollment period and outlines the efforts being made to educate employees. Please use this chart as a checklist to guide your activities during open enrollment.

RATE CHARTS Enclosed you will find approved rates for SHBP health and prescription drug plans. We have included rate charts for employers with and without prescription drug coverage. The listed rates are effective January 1, 2007 through December 31, 2007.

HEALTH CAPSULE The Health Capsule newsletter announces the SHBP Open Enrollment Period to employees and presents important information and changes that may affect their benefit selection.  The newsletter will be posted to the Divisions Web site and is scheduled for delivery to Local employers and as soon as printing is completed.  Please distribute them to your employees when received. 

HEALTH PLAN CONTACTS Also included in this mailing is a listing of marketing contacts for the various health and dental plans. Use these contacts to obtain provider directories or other plan specific literature. (These telephone numbers are not for member services. Please do not give these telephone numbers to your employees.)

HEALTH AND DENTAL PLAN APPLICATIONS The State Health Benefits Program currently has two separate applications: one application is for enrolling into the health plans (including prescription drug coverage) and the other application is for enrolling into the Employee Dental Plans. The health plan application has been recently revised and a copy is attached.  Please check that you are using the newest versions. The health and dental applications are available for download from the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm

HEALTH PLAN COMPARISON SUMMARY CHART With the changes to Local Group and Retiree copayments, the SHBP is again able to produce a single Plan Comparison Summary charts for State employees, Local Government/Educational employees, and all Retirees (State and Local Government/Educational). The comparison charts are currently being printed and copies will be shipped to employers as soon as they are available.

SUMMARY PROGRAM DESCRIPTION (SPD) BOOKLET The SHBP Summary Program Description has been revised for the 2007 plan year.  The booklet is currently being printed and copies will be shipped as soon as they are available.  The SPD is currently available for viewing over the Internet at: www.state.nj.us/treasury/pensions/shbp.htm

PLAN HANDBOOKS The SHBPs member handbooks for the Traditional Plan, NJ PLUS, and the EmployeePrescription Drug Plan are being revised for the 2007 plan year and will be available early in 2007.  HMO handbooks are also being prepared by the individual HMOs for distribution. The SHBP Dental Plans was revised for the 2006 plan year and can continue to be used for the 2007 plan year.

ONLINE INFORMATION

The SHBPs plan comparisons, member handbooks, newsletters, and rate information are available over the Internet at the State Health Benefits Program home page: www.state.nj.us/treasury/pensions/shbp.htm 

Participating provider information for all SHBP medical plans is available in the Unified Provider Directory (UPD).  The UPD is an online service that provides a comprehensive listing of health care providers and facilities that deliver their services through one or more of the SHBPs health care plans.  Updated monthly, you can access the UPD through the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm

ADDITIONAL INFORMATION

If you have any questions about the SHBP Open Enrollment Period or the information in this letter, please contact our Office of Client Services at (609) 292-7524 to speak with an Employer Group representative. 

Thank you for your assistance in making the SHBP Open Enrollment Period a success for your employees.

Enclosures:
2006 SHBP Open Enrollment Milestone Chart
Health Plan Rate Charts
Health Capsule Newsletter
Health Plan Marketing Contacts

CO Letter in Printable Format - Includes the above enclosures - Adobe PDF (435K)


September 2006

TO: Certifying Officer - Teachers Pension and Annuity Fund, Public Employees Retirement System & Police and Firemens Retirement System
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Report of Contributions, 3rd Quarter 2006 (July 1st to September 30th)

This memorandum has pertinent information concerning the completion of your Report of Contributions (ROC).  Please read this memorandum before you make any changes to the ROC.

DEADLINE FOR FILING UPDATE

Due to the overwhelming popularity of the I-ROC program and the time saved in preparing the report of contributions, the Division can now move forward with an attempt to reach its goal of updating member accounts in a more timely manner. To accomplish this goal, effective immediately, all reports must be received no later than the close of business on October 25, 2006.  Reports received after this date may not be used to update member accounts. Meeting this date will not only expedite member retirement processing but save you, the employer, unnecessary delinquency charges that will accrue after that date.  Please note that this date does not affect the actual due date of October 10, 2006, it simply allows for the 14 day grace period provided by statute.  We continue to ask for your assistance in meeting the October  10th filing date.

Delays in receiving reports affect the timeliness of the Division providing services to ALL pension plan members, not just your employees and retirees. Unfortunately, we continue to experience delays associated with employer late reporting.  This new policy of strict adherence to established reporting deadline will alleviate that problem.When you receive your quarterly ROC, you should review it immediately.  If you think you will have a problem in meeting the filing deadline, or if there is anything you do not understand, contact the Audit/Billing Section at (609) 292-3630.  Normally, reporting inquiries can be resolved with a telephone call.  If other arrangements need to be made to assist you in the completion of your ROC, the sooner you communicate that fact to the Division the better for everyone involved.

Reports of Salary Change (NEW)The Division of Pension and Benefits is no longer providing to you reports of salary change as has been our past practice. Now that the majority of employers are reporting pension data via the internet with I-ROC, we are hoping that you would use the I-ROC to submit these salary changes for the next calendar quarter. Should you need a paper report of salary change please call (609) 292-3630. This request should be made no later than November 1st, 2006, to allow for processing time.

TEPS

Please note that the only payments that should be submitted through TEPS are for monthly transmittal and appropriation payments. Employee shortages are not to be submitted through TEPS.The fax number and address that you use to submit the Employer Authorization Forms to the Division of Pensions and Benefits is (720) 332-0039, or it may be mailed to State of New Jersey, Department of Treasury, Division of Pensions and Benefits,P.O. Box 9581, Trenton, NJ 08650-9581.  

Effective September 16, 2006 the fax number above is being changed to 1-866-568-2495, the mailing address has remained the same.Chapter 113 Salary LimitsUnder Chapter 113, P.L. 1997, the amount of compensation (salary) used to determine member contributions and benefits, for the State-administered pension systems, may not exceed the compensation limitation of section 401(a)(17) of the federal Internal Revenue Code. This compensation (salary) limitation is adjusted annually, based upon cost of living increases. The federal ceiling for 2006 is $220,000. In other words, under the provisions of the Internal Revenue Code, Section 401(a)(17), for "qualified" defined benefit plans {IRC § 401(a)(2)}, the current federal ceiling on pensionable salary applies to the base salaries of members of these pension plans. Salary earned by a member in excess of this amount is not pensionable; that is, it may not be used in determining member contributions and benefits.

Should you have any questions or need assistance in completing the Report, please refer to http://www.state.nj.us/treasury/pensions/epbam/finance/roc.htm


September 2006

TO: Certifying Officer Autonomous State College/University/State Employers
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Report of Contributions, 3rd Quarter 2006 (July 1st to September 30th)

Notice To Delinquent Report Of Contribution Filers

In the past I have written explaining the importance of all employers providing to the Division of Pensions and Benefits their quarterly Report of Contributions (ROC) in a timely fashion.  As stated in the past, delays in receiving these reports affect the timeliness of the Division providing services to ALL pension plan members, not just your employees and retirees. Unfortunately, we continue to experience delays associated to employer late reporting.  I must again ask for your help in avoiding these delays at all costs and remind you that the Division will utilize everything at its disposal in order to solicit timely reporting by the employers we work with to provide benefit services to the States public employees.

Reporting And Payment Information

Your 3rd quarter 2006 tape ROC applicable to the Teachers Pension and Annuity Fund, Public Employees Retirement System, and Police and Firemens Retirement System is due by October 10, 2006.  Your September, 2006 transmittal remittance, which represents the deductions due for the balance of the quarter, should be made through the Transmittal Electronic Payments System (TEPS).  The portion of the remittance for total pension deductions should reflect the sum of normal pension contributions, back deductions, loan payments, and arrears/purchase deductions.  Your TEPS remittance is also due by October 10, 2006.With the tape ROC, you must complete and return the Transmittal Summary form for the 3rd quarter 2006.  This document is used to assist your office and this Division in reconciling your transmittal remittances to the quarterly ROC.  The Control and Certification form must also accompany your quarterly tape ROC.  This is essential as it attests to the accuracy and validity of the submitted documentation.If your quarterly ROC and total contributions are not received in a timely manner, we cannot update the pension accounts of your employees.  This may adversely affect any claim for benefits, including loan applications, filed by your employees.  Also, any delay affects our scheduling in posting contributions to all members accounts as well as the mailing of ROC for the following quarter.  A tape ROC will be considered received when it is submitted in an acceptable format, passes all data processing edits, and can be used to update members accounts.  Interest will be assessed, as prescribed by statute and administrative code, when monthly transmittal remittances and the quarterly ROC are not received within fifteen days of the due dates.

SACT Tax-Sheltered Annuity – Remittance Of 403(b) Contributions

Chapter 247, P.L. 1999 requires 403(b) salary reductions on behalf of an employee to be transmitted and credited within five business days from the pay date.Members of the Public Employees Retirement System, Teachers Pension and Annuity Fund and Police and Firemens Retirement System in the Supplemental Annuity (SACT) Tax Sheltered Annuity Program are required to have 403(b) salary reductions remitted to the Division of Pensions and Benefits within the timeframes prescribed by law.  Contributions for these members will be made through the Transmittal Electronic Payments System (TEPS).Please note that the full quarterly SUPPLEMENTAL ANNUITY contribution must be submitted prior to the processing of your ROC. If the full contribution is not submitted, it may be necessary to refund any supplemental annuity contributions sent in for the quarter. This could adversely affect your employees retirement savings.

TEPS – Transmittal Shortage Payments

The Division sends transmittal shortage statements when the sum of the transmittal remittances does not equal the due figure on the quarterly ROC.  Transmittal shortage statement payments can only be paid through TEPS.  Checks received for payment of transmittal shortages will be returned.  If you have questions related to TEPS, contact the TEPS Helpline at (888) 835-3345 or FAX your inquiries to the Audit/Billing Section at (609) 633-1708.

Changing Banking Information For TEPS

Notice of Changes for TEPS should be submitted to the Division of Pensions and Benefits on or after the date that the new checking account becomes effective.  Every Notice of Change is verified to ensure that the Division has the correct banking information.  This normally takes 12 to 15 days.

Statements Of Overages/Shortages

Overage and shortage statements, which affect a members Annuity Savings Fund, identify whether or not the pension contributions are subject to the 414(h) provision.  These statements should be reviewed to determine when adjustments are required to your payroll records in calculating year-to-date mandatory pension contributions under 414(h).  Please note that all member shortages are to be paid by separate check.  Do not remit through TEPS.

Chapter 113 Salary Limits

Under Chapter 113, P.L. 1997, the amount of compensation (salary) used to determine member contributions and benefits, for the State-administered pension systems, may not exceed the compensation limitation of section 401(a)(17) of the federal Internal Revenue Code. This compensation (salary) limitation is adjusted annually, based upon cost of living increases. The federal ceiling for 2006 is $220,000.In other words, under the provisions of the Internal Revenue Code, Section 401(a)(17), for "qualified" defined benefit plans {IRC § 401(a)(2)}, the current federal ceiling on pensionable salary applies to the base salaries of members of these pension plans. Salary earned by a member in excess of this amount is not pensionable; that is, it may not be used in determining member contributions and benefits.

Should you have any questions or need assistance in completing the Report, please refer to http://www.state.nj.us/treasury/pensions/epbam/finance/roc.htm.


August 16, 2006

TO: State Department Human Resource Directors
State Biweekly Payroll Locations Benefits Administrators
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2007)

The annual open enrollment for the calendar year 2007 New Jersey State Employees Tax Savings Program (Tax$ave 2007) will be conducted from October 1 through October 31, 2006. Full-time employees of the State who are eligible for participation in the New Jersey State Health Benefits Program (SHBP) may participate in Tax$ave.

About Tax$ave

Tax$ave consists of three components:

  1. The Premium Option Plan (POP);

  2. The Unreimbursed Medical Spending Account (UMSA); and

  3. The Dependent Care Spending Account (DCSA).

Tax$ave offers eligible employees the opportunity to increase their available income by reducing their federal tax liability. Each year eligible employees should review their personal financial circumstances and decide if they wish to participate or not. Open Enrollment offers employees the opportunity to conduct this review and then act on their decision.

Note: Tax savings on commuter mass transit and parking expenses are available at any time as a separate benefit to State employees under the Commuter Tax$ave Program and are not tied to this open enrollment period. See Fact Sheet #67, Commuter Tax$ave Program Adobe PDF (41K), for details.

Premium Option Plan

Enrollment in the Premium Option Plan Adobe PDF (71K) is automatic. This saves your employees tax money by paying health and dental premiums from pre-tax dollars and reducing their tax liability. If an employee does not wish to take advantage of the Premium Option Plan in 2007 (and therefore pay more in federal, Social Security, and Medicare taxes) he or she should file a Declination of Premium Option Plan (POP) form.

Flexible Spending Accounts

The Unreimbursed Medical Spending Account (UMSA); and the Dependent Care Spending Account (DCSA) also referred to as Flexible Spending Accounts (FSAs) are administered for the State of New Jersey by Horizon Blue Cross Blue Shield of New Jersey (Horizon BCBSNJ). 

Unlike the POP or the health plans of the SHBP, prior participation in a Tax$ave FSA in 2006 does not carry over automatically into 2007. Employees must enroll again to participate in an FSA for calendar year 2007.

Listed below are some of the benefits of FSA participation.

New! Extended Eligible Expense and Claim Filing Periods.  Effective with the start of the 2007 tax year, employees enrolled in the Unreimbursed Medical Spending Account or the Dependent Care Spending Account have until March 15 of the following year to incur eligible expenses for the current plan year. In addition to claiming eligible expenses through March 15 of the following year, the period that employees enrolled in the UMSA or DCSA have for submitting claims for reimbursement has been extended to April 30 of the following year.

For example, if there are leftover 2006 funds as of December 31, 2006, those funds will be used first for any claimed, eligible expenses incurred between January 1 and March 15, 2007 and claim forms for these expenses must be submitted no later than April 30, 2007.  As an added feature, the BennyTM Card feature of the Unreimbursed Medical Spending Account will now look back” to use 2006 dollars during the extended coverage period before accessing 2007 UMSA funds (see below for more about the Benny Card).

While this does not eliminate the use-it-or-lose-it rule completely, employees now have a longer period to obtain reimbursement for eligible expenses and avoid forfeiting unused funds.

  • Tax$ave Unreimbursed Medical Spending Accounts feature the BennyTM Card, a special MasterCard® that draws on the value of the employees annual UMSA election amount, making the UMSA easier to use. Each time an employee uses Benny to pay for a qualified health care expense at a health care provider or business that accepts MasterCard, the amount of the qualified purchase is transferred from the UMSA automatically eliminating the need to lay out cash at the time of purchase and file for a reimbursement. Once issued, the Benny Card is good for five years and should not be thrown away at the end of the plan year. Any new UMSA election amount will be automatically available through an existing Benny Card account at the start of the 2007 plan year.

  • Many over-the-counter drugs are eligible for reimbursement in the Unreimbursed Medical Spending Account. Internal Revenue Service rules permit over-the-counter products/medications deemed for "medical care" to be considered reimbursable. "Medical care" includes amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease. While purchases of medicines and drugs for medical care are eligible for reimbursement, expenditures that are merely beneficial to the general health of an individual, such as vitamins and other supplements, are not eligible.

For more information about expenses that are eligible under Unreimbursed Medical Spending Accounts and Dependent Care Spending Accounts, please visit the Horizon BCBSNJ Web site through the link from the Division of Pensions and Benefits Tax$ave page at: www.state.nj.us/treasury/pensions/taxsave.htm

Enrolling in a Flexible Spending Account

Employees have three ways of enrolling in the Tax$ave FSA accounts: mail, telephone, and Internet. The Tax$ave publications will provide the following instructions to employees:

  • Mail: FSA Election Applications must be mailed directly to Horizon BCBSNJ by the employee. All election forms must be postmarked no later than October 31, 2006, to be accepted. Those postmarked after October 31, 2006 will be returned without action. Benefits offices should not be involved in processing or mailing FSA Election Applications.

  • Telephone: Employees may either enroll (or reenroll) in the UMSA or DCSA plans for 2007 over the phone by calling Horizon BCBSNJs automated voice response unit at 1-800-224-4426. This is a great opportunity to quickly and easily go through the process of a new or repeat enrollment. Horizon will inform current participating employees of this opportunity through a direct mailing in September. The deadline for enrollment by telephone is midnight, October 31, 2006.

  • Internet: Again this year employees have the ability to enroll (or reenroll) over the Internet. Go to the Horizon BCBSNJ Web page through a link from the Division of Pensions and Benefits Tax$ave page at: www.state.nj.us/treasury/pensions/taxsave.htm and follow the simple directions. The deadline for enrollment over the Internet is midnight, October 31, 2006.

Tax$ave and Domestic Partners and Dependents Age 23 to 30

  • Under the New Jersey Domestic Partnership Act, State employees may add a same-sex domestic partner to their SHBP medical and dental insurance coverage.

  • New in plan year 2007, Chapter 375, P.L. 2005, allows continued SHBP medical plan coverage for certain dependents until their 30th birthday.

It is important to note, however, that before any premiums that the employee pays for domestic partner coverage or continued coverage for an over-age dependent can be made on a pre-tax basis under the Tax$ave Premium Option Plan, the domestic partner and/or dependent must be able to qualify as a tax dependent” of the employee for federal tax filing purposes under IRC Section 152. Similarly, the domestic partner and/or dependent must qualify as the employees federal tax dependent before an out-of-pocket medical expense incurred by the domestic partner and/or dependent can be reimbursed under the Unreimbursed Medical Spending Account.

If the domestic partner and/or dependent is not a qualified tax dependent” of the employee, any premium deductions made for the domestic partners or dependents coverage must be made on an after-tax basis and funds in the Unreimbursed Medical Spending Account cannot be used to cover the domestic partners or dependents medical expenses. See IRS Tax Topic 354 - Dependents for additional information on dependent status for federal tax purposes.

Additional information regarding the Domestic Partnership Act can be found in Fact Sheet #71, Benefits Under the Domestic Partnership Act Adobe PDF (56K), which is available on the Division of Pensions and Benefits Web site: www.state.nj.us/treasury/pensions  

For more information about continued coverage for dependents age 23 to 30, see the SHBP home page at: www.state.nj.us/treasury/pensions/shbp.htm  

Employee Seminars

Upon request, Horizon BCBSNJ will provide Tax$ave educational seminars, at your workplace, for interested employees. The seminars are about 60 minutes in duration and includes time for questions and answers. These seminars have proven to be very successful educational tools and we strongly encourage you to make one available to your employees. Please see the enclosed request form to schedule a seminar with a Horizon BCBSNJ representative (please note that we ask for a minimum of 25 employees).

Tax$ave Support Materials

The remainder of this letter provides information on the Tax$ave Open Enrollment publications and support available to assist you in explaining this important benefit program to your employees. Please do your best to make a concerted effort to inform your employees of the open enrollment and to educate them on the valuable benefits that Tax$ave offers them. We believe that more employees will participate in Tax$ave if they are made aware and understand the value of the tax savings offered by the program.

Enclosed is the Tax$ave Open Enrollment Milestones chart that lists the critical dates of the Tax$ave 2007 Annual Open Enrollment and outlines the efforts being made to educate employees. Please use this chart as a checklist to guide your activities during the open enrollment.

Anouncement of the open enrollment to employees paid through Centralized Payroll will be made in a September 8 paycheck message that will be accompanied by three payroll inserts. These inserts are:

  • The Tax$ave 2007 Open Enrollment News that announces the open enrollment, outlines the components of the program with emphasis on its tax saving advantages, and identifies the October 31, 2006 deadline for submission of all election materials;

  • An FSA pamphlet that describes the Unreimbursed Medical Spending Account (UMSA) and the Dependent Care Spending Account (DCSA); and

  • The Premium Option Plan 2007 pamphlet that explains the advantages and disadvantages of participation.

The September 22 paychecks will carry another Tax$ave 2007 Open Enrollment announcement message and ”reminder messages” will be provided to employees through paycheck messages on October 6 and October 20 (a final November 3 paycheck message will address the Commuter Tax$ave Program). The text of these check message announcements and preview copies of the Tax$ave publications are enclosed with this letter.

The other open enrollment materials you will need are the FSA Election Kits and the Declination of Premium Option Plan (POP) for Plan Year 2007 form.

  • FSA Election Kits for 2007 will be sent directly to benefits administrators by Horizon BCBSNJ, along with a request form for additional kits. Please provide the FSA Election Kits to those employees who request them.

  • This letter includes a sample of the declination forms. This can be copied for use by those few employees who do not wish to participate in the POP and, therefore, pay more in tax. (Note: do not distribute POP Declination forms to employees unless they ask for one.) If an employee chooses not to save tax dollars under the Tax$ave Premium Option Plan and wants to pay more federal income, Social Security, and Medicare taxes on the salary used to pay their medical and dental premiums in 2007, they must complete a POP form declining the federal tax break they could receive. Employees should request these forms from you. We will be instructing employees to return the Declination of Premium Option Plan (POP) forms to benefits administrators by October 31, 2006. Benefits administrators must then forward declination forms to Centralized Payroll by November 10, 2006.

We appreciate your cooperation. Your involvement in the Tax$ave Open Enrollment is key to your employees receiving the valuable benefits offered by this program. If you have any questions about Tax$ave 2007 or the open enrollment, call Horizon BCBSNJ at 1-800-224-4426, or visit the Division of Pensions and Benefits Tax$ave Internet site at: www.state.nj.us/treasury/pensions/taxsave.htm  

Enclosures:

Request for Tax$ave 2007 Employee Seminars
Tax$ave 2007 Open Enrollment Milestones
Open Enrollment Check Messages
Tax$ave 2007 Open Enrollment News (sample)
The Premium Option Plan 2007 Pamphlet (sample)
Tax$ave Pamphlet – Savings You Can Bank On… (sample)
Declination of Premium Option Plan (POP) for Plan Year 2007

CO Letter in Printable Format Adobe PDF (75 K)


August 16, 2006

TO: State University and College Benefits Administrators
State Monthly Benefits Administrators
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2007)

The annual open enrollment for the calendar year 2007 New Jersey State Employees Tax Savings Program (Tax$ave 2007) will be conducted from October 1 through October 31, 2006. Full-time employees of the State, State authorities, State universities, and State colleges who are eligible for participation in the New Jersey State Health Benefits Program (SHBP) may participate in Tax$ave.

About Tax$ave

Tax$ave consists of three components:

  1. The Premium Option Plan (POP);

  2. The Unreimbursed Medical Spending Account (UMSA); and

  3. The Dependent Care Spending Account (DCSA).

Tax$ave offers eligible employees the opportunity to increase their available income by reducing their federal tax liability. Each year eligible employees should review their personal financial circumstances and decide if they wish to participate or not. Open Enrollment offers employees the opportunity to conduct this review and then act on their decision.

Note: Tax savings on commuter mass transit and parking expenses are available at any time as a separate benefit to State employees under the Commuter Tax$ave Program and are not tied to this open enrollment period. See Fact Sheet #67, Commuter Tax$ave Program Adobe PDF (41K), for details.

Premium Option Plan

Enrollment in the Premium Option Plan is automatic. This saves your employees tax money by paying health and dental premiums from pre-tax dollars and reducing their tax liability. If an employee does not wish to take advantage of the Premium Option Plan in 2007 (and therefore pay more in federal, Social Security, and Medicare taxes) he or she should file a Declination of Premium Option Plan (POP) form.

Flexible Spending Accounts

The Unreimbursed Medical Spending Account (UMSA); and the Dependent Care Spending Account (DCSA) also referred to as Flexible Spending Accounts (FSAs) are administered for the State of New Jersey by Horizon Blue Cross Blue Shield of New Jersey (Horizon BCBSNJ). 

Unlike the POP or the health plans of the SHBP, prior participation in a Tax$ave FSA in 2006 does not carry over automatically into 2007. Employees must enroll again to participate in an FSA for calendar year 2007.

Listed below are some of the benefits of FSA participation.

New! Extended Eligible Expense and Claim Filing Periods.  Effective with the start of the 2007 tax year, employees enrolled in the Unreimbursed Medical Spending Account or the Dependent Care Spending Account have until March 15 of the following year to incur eligible expenses for the current plan year. In addition to claiming eligible expenses through March 15 of the following year, the period that employees enrolled in the UMSA or DCSA have for submitting claims for reimbursement has been extended to April 30 of the following year.

For example, if there are leftover 2006 funds as of December 31, 2006, those funds will be used first for any claimed, eligible expenses incurred between January 1 and March 15, 2007 and claim forms for these expenses must be submitted no later than April 30, 2007.  As an added feature, the BennyTM Card feature of the Unreimbursed Medical Spending Account will now look back” to use 2006 dollars during the extended coverage period before accessing your 2007 UMSA funds (see below for more about the Benny Card).

While this does not eliminate the use-it-or-lose-it rule completely, employees now have a longer period to obtain reimbursement for eligible expenses and avoid forfeiting unused funds.

  • Tax$ave Unreimbursed Medical Spending Accounts feature the BennyTM Card, a special MasterCard® that draws on the value of the employees annual UMSA election amount, making the UMSA easier to use. Each time an employee uses Benny to pay for a qualified health care expense at a health care provider or business that accepts MasterCard, the amount of the qualified purchase is transferred from the UMSA automatically eliminating the need to lay out cash at the time of purchase and file for a reimbursement. Once issued, the Benny Card is good for five years and should not be thrown away at the end of the plan year. Any new UMSA election amount will be automatically available through an existing Benny Card account at the start of the 2007 plan year.

  • Many over-the-counter drugs are eligible for reimbursement in the Unreimbursed Medical Spending Account. Internal Revenue Service rules permit over-the-counter products/medications deemed for "medical care" to be considered reimbursable. "Medical care" includes amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease. While purchases of medicines and drugs for medical care are eligible for reimbursement, expenditures that are merely beneficial to the general health of an individual, such as vitamins and other supplements, are not eligible.

For more information about expenses that are eligible under Unreimbursed Medical Spending Accounts and Dependent Care Spending Accounts, please visit the Horizon BCBSNJ Web site through the link from the Division of Pensions and Benefits Tax$ave page at: www.state.nj.us/treasury/pensions/taxsave.htm

Enrolling in a Flexible Spending Account

Employees have three ways of enrolling in the Tax$ave FSA accounts: mail, telephone, and Internet. The Tax$ave publications will provide the following instructions to employees:

  • Mail: FSA Election Applications must be mailed directly to Horizon BCBSNJ by the employee. All election forms must be postmarked no later than October 31, 2006, to be accepted. Those postmarked after October 31, 2006 will be returned without action. Benefits offices should not be involved in processing or mailing FSA Election Applications.

  • Telephone: Employees may either enroll (or reenroll) in the UMSA or DCSA plans for 2007 over the phone by calling Horizon BCBSNJs automated voice response unit at 1-800-224-4426. This is a great opportunity to quickly and easily go through the process of a new or repeat enrollment. Horizon will inform current participating employees of this opportunity through a direct mailing in September. The deadline for enrollment by telephone is midnight, October 31, 2006.

  • Internet: Again this year employees have the ability to enroll (or reenroll) over the Internet. Go to the Horizon BCBSNJ Web page through a link from the Division of Pensions and Benefits Tax$ave page at: www.state.nj.us/treasury/pensions/taxsave.htm and follow the simple directions. The deadline for enrollment over the Internet is midnight, October 31, 2006.

Tax$ave and Domestic Partners and Dependents Age 23 to 30

  • Under the New Jersey Domestic Partnership Act, State employees may add a same-sex domestic partner to their SHBP medical and dental insurance coverage.

  • New in plan year 2007, under Chapter 375, P.L. 2005, State employees may request continued SHBP medical plan coverage for certain dependents until their 30th birthday.

It is important to note, however, that before any premiums that the employee pays for domestic partner coverage or continued coverage for an overage dependent can be made on a pre-tax basis under the Tax$ave Premium Option Plan, the domestic partner and/or dependent must be able to qualify as a tax dependent” of the employee for federal tax filing purposes under IRC Section 152. Similarly, the domestic partner and/or dependent must qualify as the employees federal tax dependent before an out-of-pocket medical expense incurred by the domestic partner and/or dependent can be reimbursed under the Unreimbursed Medical Spending Account.

If the domestic partner and/or dependent is not a qualified tax dependent” of the employee, any premium deductions made for the domestic partners or dependents coverage must be made on an after-tax basis and funds in the Unreimbursed Medical Spending Account cannot be used to cover the domestic partners or dependents medical expenses. See IRS Tax Topic 354 - Dependents for additional information on dependent status for federal tax purposes.

Additional information regarding the Domestic Partnership Act can be found in Fact Sheet #71, Benefits Under the Domestic Partnership Act Adobe PDF (56K), which is available on the Division of Pensions and Benefits Web site: www.state.nj.us/treasury/pensions

For more information about continued coverage for dependents age 23 to 30, see the SHBP home page at:
www.state.nj.us/treasury/pensions/shbp.htm
  

Employee Seminars

Upon request, Horizon BCBSNJ will provide Tax$ave educational seminars, at your workplace, for interested employees. The seminars are about 60 minutes in duration and includes time for questions and answers. These seminars have proven to be very successful educational tools and we strongly encourage you to make one available to your employees. Please see the enclosed request form to schedule a seminar with a Horizon BCBSNJ representative (please note that we ask for a minimum of 25 employees).

Tax$ave Support Materials

The remainder of this letter provides information on the Tax$ave Open Enrollment publications and support available to assist you in explaining this important benefit program to your employees. Please do your best to make a concerted effort to inform your employees of the open enrollment and to educate them on the valuable benefits that Tax$ave offers them. We believe that more employees will participate in Tax$ave if they are made aware and understand the value of the tax savings offered by the program.

Enclosed is the Tax$ave Open Enrollment Milestones chart that lists the critical dates of the Tax$ave 2007 Annual Open Enrollment and outlines the efforts being made to educate employees. Please use this chart as a checklist to guide your activities during the open enrollment.

The Division will also provide State Monthly employers, State Universities, and State Colleges with sufficient copies of the Tax$ave 2007 Open Enrollment News and the Premium Option Plan 2007 pamphlet for all eligible employees. Horizon BCBSNJ will provide sufficient copies of the FSA pamphlet for distribution to all of your eligible employees.

  • The Tax$ave 2007 Open Enrollment News announces the open enrollment, outlines the components of the program with emphasis on its tax saving advantages, and identifies the October 31, 2006 deadline for submission of all election materials.

  • The Premium Option Plan 2007 pamphlet explains the advantages and disadvantages of participation.

  • The FSA pamphlet describes the Unreimbursed Medical Spending Account (UMSA) and the Dependent Care Spending Account (DCSA).

These publications will be shipped to employers early in September and you should distribute them to your employees before the Open Enrollment start date on October 1, 2006.  Preview copies of these publications are enclosed with this letter.

We also encourage you to provide your employees with reminders of the Tax$ave Open Enrollment to ensure they dont allow this opportunity to slip by without action.

The other open enrollment materials you will need are the FSA Election Kits and the Declination of Premium Option Plan (POP) for Plan Year 2007 form.

  • FSA Election Kits for 2007 will be sent directly to benefits administrators by Horizon BCBSNJ, along with a request form for additional kits. Please provide the FSA Election Kits to those employees who request them.

  • This letter includes a sample of the declination forms. This can be copied as needed for use by those few employees who do not wish to participate in the POP and, therefore, pay more in tax. (Note: do not distribute POP Declination forms to employees unless they ask for one.) If an employee chooses not to save tax dollars under the Tax$ave Premium Option Plan and wants to pay more federal income, Social Security, and Medicare taxes on the salary used to pay their medical and dental premiums in 2007, they must complete a POP form declining the federal tax break they could receive. Employees should request these forms from you. We will be instructing employees to return the Declination of Premium Option Plan (POP) forms to benefits administrators by October 31, 2006. Benefits administrators must then forward declination forms to the appropriate representative in their payroll department.

We appreciate your cooperation. Your involvement in the Tax$ave Open Enrollment is key to your employees receiving the valuable benefits offered by this program. If you have any questions about Tax$ave 2007 or the open enrollment, call Horizon BCBSNJ at 1-800-224-4426, or visit the Division of Pensions and Benefits Tax$ave Internet site at: www.state.nj.us/treasury/pensions/taxsave.htm  

Enclosures:

Request for Tax$ave 2007 Employee Seminars
Tax$ave 2007 Open Enrollment Milestones
Tax$ave 2007 Open Enrollment News (sample)
The Premium Option Plan 2007 Pamphlet (sample)
Tax$ave Pamphlet – Savings You Can Bank On… (sample)
Declination of Premium Option Plan

CO Letter in Printable Format Adobe PDF (75K)


July 2006

TO: County Certifying Officers of the Public Employees Retirement System (PERS) and the Police and Firemens Retirement System (PFRS)
FROM: Florence J. Sheppard
Deputy Director, Benefit Operations
SUBJECT: Chapter 366, P.L. 2005 Enrollment of Fire Marshals into the Police and Firemens Retirement System (PFRS)

Chapter 366, P.L. 2005, effective January 12, 2006, requires that Fire Marshals” be enrolled in the Police and Firemen's Retirement System (PFRS).

For the purposes of this law, a Fire Marshal” is defined as a permanent, full-time County Fire Marshal or Assistant County Fire Marshal who is authorized by the County Board of Chosen Freeholders to provide municipal fire departments with assistance as necessary to coordinate, control, or extinguish any fire situation or other emergency situation as defined under N.J.S.A. 40A:14-2b(8). Individuals appointed to part-time positions are not eligible for participation in the PFRS under this legislation.

Enrollees must also meet all of the eligibility requirements for qualification for enrollment in the PFRS, except that a qualifying County Fire Marshal or Assistant County Fire Marshal who is in service at the time this law takes effect will be exempt from any age requirement for enrollment in the PFRS.

Individuals hired into these positions after the effective date of this law, will have to meet the maximum age requirements of the PFRS.

All enrollees in eligible positions, where the County Board of Chosen Freeholders authorizes such positions to perform the duties as defined under N.J.S.A. 40A:14-2b(8), are required to pass a physical examination and submit a current PFRS Report of Examining Physician Adobe PDF (10K) to the Division of Pensions and Benefits.

In addition, any qualifying County Fire Marshal or Assistant County Fire Marshal given approval by the County Board of Chosen Freeholders on or after October 1, 2001, shall be enrolled as a member in the Police and Firemen's Retirement System effective upon the date when such approval by the County Board of Chosen Freeholders was given. Posthumous enrollment or the enrollment of retired fire marshals is not permitted.

Once enrolled, members eligible for Chapter 366 will receive the full member and survivor benefits available under the PFRS. Most members of the PFRS are subject to mandatory retirement at age 65.

ADMINISTRATION

Where the County Board of Chosen Freeholders has given authorization to full-time County Fire Marshals or Assistant County Fire Marshals to conduct such activities as defined under N.J.S.A. 40A:14-2b(8), the Certifying Officer should immediately enroll employees who meet the eligibility requirements of Chapter 366 into the PFRS.

  • Employers should submit a copy of any existing Resolution that authorizes County Fire Marshals or Assistant County Fire Marshals to provide municipal fire departments with assistance as necessary to coordinate, control, or extinguish any fire situation or other emergency situation as defined under N.J.S.A. 40A:14-2b(8).

If such a Resolution does not currently exist, the County Board of Chosen Freeholders should adopt such a Resolution and the employer should forward a copy of the adopted Resolution to the Division of Pensions and Benefits. A sample Resolution form is enclosed for this purpose Adobe PDF (25K).

Note: If the duties of the County Fire Marshals or Assistant County Fire Marshals change and they are no longer authorized to perform the fire suppression duties as defined under N.J.S.A. 40A:14-2b(8), the County Board of Chosen Freeholders should adopt an amended Resolution and the employer should forward a copy of the amendment to the Division of Pensions and Benefits.

  • Employees and their employers should complete and submit an Application for Enrollment Adobe PDF (11K) into the PFRS to the Division of Pensions and Benefits (please mark the top of the application form Chapter 366”).

Please be aware that if a member does not have at least 10 years of service in the PERS and they choose not to interfund transfer, their PERS account will expire after two years without contributions and the member will have to withdraw their contributions from the PERS account and forfeit service credit under that account.

The law specifically states that the cost of enrollment of a full-time County Fire Marshal or Assistant County Fire Marshal in the PFRS shall not be the responsibility of the State.

ADDITIONAL INFORMATION

If you have additional questions regarding Chapter 366, or any of the information provided in this letter, contact the Divisions Office of Client Services at (609) 292-7524, or e-mail the Division.

Enclosure Adobe PDF (25K)

CO Letter in Printable Format Adobe PDF (75K)


June 2006

TO: Certifying Officer – Teachers Pension and Annuity Fund, Public Employees Retirement System & Police and Firemens Retirement System
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Report of Contributions, Second Quarter 2006 (April 1st to June 30th)

This memorandum has pertinent information concerning the completion of your Report of Contributions (ROC).  Please read this memorandum before you make any changes to the ROC.

DEADLINE FOR FILING UPDATE

Due to the overwhelming popularity of the I-ROC program and the time saved in preparing the report of contributions, the Division can now move forward with an attempt to reach its goal of updating member accounts in a more timely manner.

To accomplish this goal, effective immediately, all reports must be received no later than the close of business on July 25, 2006.  Reports received after this date may not be used to update member accounts.

Meeting this date will not only expedite member retirement processing but save you, the employer, unnecessary delinquency charges that will accrue after that date.  Please note that this date does not affect the actual due date of July 10, 2006, it simply allows for the 14 day grace period provided by statute.  We continue to ask for your assistance in meeting the July 10th filing date. 

Delays in receiving reports affect the timeliness of the Division providing services to ALL pension plan members, not just your employees and retirees.  Unfortunately, we continue to experience delays associated with employer late reporting.  This new policy of strict adherence to established reporting deadline will alleviate that problem.

When you receive your quarterly ROC, you should review it immediately.  If you think you will have a problem in meeting the filing deadline, or if there is anything you do not understand, contact the Audit/Billing Section at (609) 292-3630.  Normally, reporting inquiries can be resolved with a telephone call.  If other arrangements need to be made to assist you in the completion of your ROC, the sooner you communicate that fact to the Division the better for everyone involved.

Reports of Salary Change (NEW)

The Division of Pensions and Benefits is no longer providing to you reports of salary change as has been our past practice.  Now that the majority of employers are reporting through the web, (IROC), we are hoping that you would use the report of contributions to submit these salary changes for the next quarter.  Should you need a paper report of salary change please call (609) 292-3630.

TEPS

Please note that the only payments that should be submitted through TEPS are for monthly transmittal and appropriation payments.  Employee shortages are not to be submitted through TEPS.

The fax number and address that you use to submit the Employer Authorization Forms to the Division of Pensions and Benefits is (720) 332-0039 or it may be mailed to State of New Jersey, Department of Treasury, Division of Pensions and Benefits, P.O. Box 9581, Trenton, NJ 08650-9581.

Chapter 113 Salary Limits

Under Chapter 113, P.L. 1997, the amount of compensation (salary) used to determine member contributions and benefits, for the State-administered pension systems, may not exceed the compensation limitation of section 401(a)(17) of the federal Internal Revenue Code.  This compensation (salary) limitation is adjusted annually, based upon cost of living increases.  The federal ceiling for 2006 is $220,000.

In other words, under the provisions of the Internal Revenue Code, Section 401(a)(17), for "qualified" defined benefit plans {IRC § 401(a)(2)}, the current federal ceiling on pensionable salary applies to the base salaries of members of these pension plans.  Salary earned by a member in excess of this amount is not pensionable; that is, it may not be used in determining member contributions and benefits.

Should you have any questions or need assistance in completing the Report, please refer to http://www.state.nj.us/treasury/pensions/epbam/finance/roc.htm


June 2006

TO: Certifying Officer Autonomous State College / University/State Employers
FROM: John D. Megariotis
Deputy Director, Finance
SUBJECT: Report of Contributions, Second Quarter 2006 (April 1st to June 30th)

Notice To Delinquent Report Of Contribution Filers

In the past I have written explaining the importance of all employers providing to the Division of Pensions and Benefits their quarterly Report of Contributions (ROC) in a timely fashion.  As stated in the past, delays in receiving these reports affect the timeliness of the Division providing services to ALL pension plan members, not just your employees and retirees. Unfortunately, we continue to experience delays associated to employer late reporting.  I must again ask for your help in avoiding these delays at all costs and remind you that the Division will utilize everything at its disposal in order to solicit timely reporting by the employers we work with to provide benefit services to the State's public employees.

Reporting And Payment Information

Your 2nd quarter 2006 tape ROC applicable to the Teachers Pension and Annuity Fund, Public Employees Retirement System, and Police and Firemens Retirement System is due by July 10, 2006.  Your June 2006 transmittal remittance, which represents the deductions due for the balance of the quarter, should be made through the Transmittal Electronic Payments System (TEPS).  The portion of the remittance for total pension deductions should reflect the sum of normal pension contributions, back deductions, loan payments, and arrears/purchase deductions.  Your TEPS remittance is also due by July 10, 2005.

With the tape ROC, you must complete and return the Transmittal Summary form for the 2nd quarter 2006.  This document is used to assist your office and this Division in reconciling your transmittal remittances to the quarterly ROC.  The Control and Certification form must also accompany your quarterly tape ROC.  This is essential as it attests to the accuracy and validity of the submitted documentation.

If your quarterly ROC and total contributions are not received in a timely manner, we cannot update the pension accounts of your employees.  This may adversely affect any claim for benefits, including loan applications, filed by your employees.  Also, any delay affects our scheduling in posting contributions to all members accounts as well as the mailing of ROC for the following quarter.  A tape ROC will be considered received when it is submitted in an acceptable format, passes all data processing edits, and can be used to update members accounts.  Interest will be assessed, as prescribed by statute and administrative code, when monthly transmittal remittances and the quarterly ROC are not received within fifteen days of the due dates.

SACT Tax-Sheltered Annuity – Remittance Of 403(b) Contributions

Chapter 247, P.L. 1999 requires 403(b) salary reductions on behalf of an employee to be transmitted and credited within five business days from the pay date.

Members of the Public Employees Retirement System, Teachers Pension and Annuity Fund and Police and Firemens Retirement System in the Supplemental Annuity (SACT) Tax Sheltered Annuity Program are required to have 403(b) salary reductions remitted to the Division of Pensions and Benefits within the timeframes prescribed by law.  Contributions for these members will be made through the Transmittal Electronic Payments System (TEPS).

Please note that the full quarterly SUPPLEMENTAL ANNUITY contribution must be submitted prior to the processing of your ROC. If the full contribution is not submitted, it may be necessary to refund any supplemental annuity contributions sent in for the quarter. This could adversely affect your employees retirement savings.

TEPS – Transmittal Shortage Payments

The Division sends transmittal shortage statements when the sum of the transmittal remittances does not equal the due figure on the quarterly ROC.  Transmittal shortage statement payments can only be paid through TEPS.  Checks received for payment of transmittal shortages will be returned.  If you have questions related to TEPS, contact the TEPS Helpline at (888) 835-3345 or FAX your inquiries to the Audit/Billing Section at (609) 633-1708.

Changing Banking Information For TEPS

Notice of Changes for TEPS should be submitted to the Division of Pensions and Benefits on or after the date that the new checking account becomes effective. Every Notice of Change is verified to ensure that the Division has the correct banking information.  This normally takes 12 to 15 days.

Statements Of Overages / Shortages

Overage and shortage statements, which affect a members Annuity Savings Fund, identify whether or not the pension contributions are subject to the 414(h) provision. These statements should be reviewed to determine when adjustments are required to your payroll records in calculating year-to-date mandatory pension contributions under 414(h).  Please note that all member shortages are to be paid by separate check.  Do not remit through TEPS.

Chapter 113 Salary Limits

Under Chapter 113, P.L. 1997, the amount of compensation (salary) used to determine member contributions and benefits, for the State-administered pension systems, may not exceed the compensation limitation of section 401(a)(17) of the federal Internal Revenue Code. This compensation (salary) limitation is adjusted annually, based upon cost of living increases. The federal ceiling for 2006 is $220,000.

In other words, under the provisions of the Internal Revenue Code, Section 401(a)(17), for "qualified" defined benefit plans {IRC § 401(a)(2)}, the current federal ceiling on pensionable salary applies to the base salaries of members of these pension plans. Salary earned by a member in excess of this amount is not pensionable; that is, it may not be used in determining member contributions and benefits.

Should you have any questions or need assistance in completing the Report, please refer to http://www.state.nj.us/treasury/pensions/epbam/finance/roc.htm.


April 2006

TO: Public Employees' Retirement System (PERS) Certifying Officers
FROM: Janice C. Curtin
Assistant Director, Pension Operations
SUBJECT: Chapter 368, P.L. 2005 — Service Credit While on Leave for Union Representation

Chapter 368, P.L. 2005, effective January 12, 2006, permits certain members of the Public Employees' Retirement System (PERS) to obtain PERS service credit for a paid or unpaid leave of absence while serving as an elected or appointed officer or representative of a local, county, or State labor organization (union) which represents, or is affiliated with an organization (union) which represents public employees.

Note: PERS members who are police officers or firefighters are excluded from the provisions of Chapter 368.

EMPLOYEES HAVING ELIGIBLE SERVICE PRIOR TO THE ENACTMENT OF CHAPTER 368, P.L. 2005

Eligible employees who have taken an approved, unpaid leave of absence for union representation prior to the enactment of Chapter 368 and who have not received PERS credit for that service may purchase the service credit.

  • Employees of a local employer (county, municipal) or State monthly employer may purchase approved, unpaid leave of absence for union representation taken through December 31, 2005;

  • Employees of a State biweekly employer (paid through the State Centralized Payroll) may purchase approved, unpaid leave of absence for union representation taken through January 6, 2006;
The Division of Pensions and Benefits has no information indicating which PERS members are eligible for a purchase under Chapter 368. Therefore, if any member of your staff qualifies for a purchase under this law, please provide them with a copy of the informational flier enclosed with this letter.

In accordance with Chapter 368, eligible employees have until January 12, 2007 (one year after the effective date of the law) to apply for the purchase. In order to make application, an eligible member must write to the Supervisor of the Purchase Section of the Division of Pensions and Benefits and request the purchase.

Letters of request must include:

  • The member's full name;
  • PERS membership number;
  • Social Security number;
  • The beginning and ending dates of the leave of absence for service as an officer or representative of an eligible labor organization; and
  • The member's signature and the date.

The cost of purchasing the PERS service credit under Chapter 368 is a "full cost" purchase - this means that the employee pays both the employer and employee portions of the cost for this service. The cost of the purchase will be based on the member's age and highest salary at the time of the purchase request. Furthermore, service purchased under the provisions of Chapter 368 must be purchased through a lump-sum payment (payment through payroll deductions is not permitted). The purchase of partial service credit is permitted.

To estimate the cost of a purchase under Chapter 368, eligible employees can refer to Fact Sheet #2, Estimating the Cost of Purchasing Service Credit Adobe PDF (33K), or they may use the Division's online PERS/TPAF Purchase Estimate Calculator. When using the calculator to estimate the cost for union service, select "U. S. Military Service Before Enrollment" as the purchase type. The lump-sum cost indicated will be the same as the cost for a purchase under Chapter 368.

A link to the online purchase calculator is found at:

www.state.nj.us/treasury/pensions/purchase-service.shtml


EMPLOYEES CURRENTLY SERVING AS AN OFFICER OF A QUALIFIED ORGANIZATION
OR MEMBERS SERVING IN THE FUTURE

An eligible employee on an approved leave of absence for union representation on or after the effective date of Chapter 368, may receive PERS service credit for this time.

  • An employee on an approved paid leave of absence for union representation may receive PERS service credit for this time, provided the employer is reimbursed in advance for compensation and benefit costs including retirement system contributions and health benefit costs, or is reimbursed in accordance with the terms of a collective bargaining agreement. The length of any paid leave is subject to negotiation between the employer and the union.

  • An employee on an approved unpaid leave of absence for union service may receive PERS service credit for this time, provided the member pays PERS the "full cost" - employer and employee contributions - for the PERS service credit. Eligible employees on an unpaid leave of absence for union service will be billed quarterly for the full cost of the PERS service.

The receipt of PERS service credit under the provisions of Chapter 368 is contingent upon the timely and proper receipt by the Division of Pensions and Benefits of all required contributions. Under the provisions of this law, the pension contributions due will be based on the employee's rate of contribution and the employer's annual appropriation rate.

The Division of Pensions has limited information indicating which PERS members currently on leave of absence are eligible for PERS service credit under Chapter 368. Therefore, all eligible employees on a paid or unpaid leave of absence for union representation must be identified to the Division of Pensions and Benefits by the employer and/or the union. Before any employee may qualify for service credit under this law, the Division of Pensions and Benefits must receive:

  • A Report of Transfer/Multiple Enrollment Form filed through the union; and

  • A Chapter 368, P.L. 2005 Employer Verification of Leave of Absence form (enclosed) completed by the PERS employer.

During an eligible employee's leave of absence, PERS employers should make a notation on the Quarterly Report of Contributions indicating the employee is on a leave of absence. In addition, the Division of Pensions may request annual verification of salary from the employer in order to arrive at proper contribution amounts.

When an eligible employee terminates their leave of absence and returns to regular PERS duties, the employee and employer must file a new Report of Transfer/Multiple Enrollment Form to have PERS contributions recertified and included on the Quarterly Report of Contributions.

ADDITIONAL INFORMATION FOR EMPLOYEES ON AN APPROVED LEAVE
OF ABSENCE FOR UNION REPRESENTATION

  • IRS regulations require employees to make timely payments toward outstanding loan balances while on a leave of absence without pay for more than three months. These employees will be offered the choice of making a lump-sum payment for the entire loan balance and interest; or repayment of the loan in monthly installments through personal billing. Failure to repay a loan as scheduled may result in the unpaid loan balance being declared a taxable distribution. If the loan is determined to be in default, the loan will be considered a distribution from your pension account and reported to the IRS.

  • Upon taking a leave of absence without pay, group life insurance coverage under the PERS remains in effect for 93 days. To continue the contributory portion of group life insurance coverage the employee must pay the required premiums in advance to the Division of Pensions and Benefits. After the 93 days, the employee has the option of converting the group life insurance to a private policy with the Prudential Insurance Company. See Fact Sheet #13, Conversion of Group Life Insurance, for details.

  • If, while on leave of absence for union representation, the employee is eligible for any period of continued coverage under the PERS employer's health benefits plan, any premiums required for that coverage must be paid in advance to the employer

  • An eligible employee may choose to retire during the leave of absence period. However, all contributions due to the PERS must be paid in full as of the date of retirement.

  • Contributions to the New Jersey State Employees Deferred Compensation Plan or the Supplemental Annuity Collective Trust are not permitted while on a leave of absence. An employee may elect to begin to receive distribution from these plans if the employee becomes eligible through termination or retirement.

  • If the member dies during the leave of absence, PERS death benefits will be paid. This would include the return of member contributions to the PERS and - if still in effect - any group life insurance.

ADDITIONAL INFORMATION

If you have additional questions regarding employer compliance with Chapter 368, or any of the information provided in this letter, contact the Division's Office of Client Services at (609) 292-7524, or e-mail the Division.

Enclosures:

Purchase of Leave for Union Officers Adobe PDF (21K)
Employer Verification of Leave of Absence for Union Representation Adobe PDF (20K)
Report of Transfer/Multiple Enrollment Form Adobe PDF (25K)


March 2006

TO: Municipal Government Certifying Officers of the Public Employees' Retirement System (PERS) and Police and Firemen's Retirement System (PFRS)
FROM: Janice C. Curtin
Assistant Director, Pension Operations
SUBJECT: Chapter 326, P.L. 2005 — Volunteer Firefighter Transfer to Police and Firemen's Retirement System (PFRS)

On January 12, 2006, Chapter 326, P.L. 2005, was signed into law. This legislation provides that certain firefighters employed as of January 12, 2006 who were originally volunteers before being appointed to paid positions by a municipality may transfer their membership from the Public Employees' Retirement System (PERS) to the Police and Firemen's Retirement System (PFRS), regardless of age.

The Division of Pensions and Benefits is in the process of implementing the provisions of this new law. However, as a part of this process we require your immediate assistance in identifying firefighters now enrolled in the PERS who may be eligible to transfer to the PFRS as a result of this legislation.

ELIGIBILITY

Employees eligible under Chapter 326, P.L. 2005 are firefighters employed as of January 12, 2006, of any age, who were originally volunteers before being appointed to paid positions by a municipality, and who:

  1. were not eligible for Police and Firemen's Retirement System (PFRS) membership at the time of appointment to the paid position;

  2. meet the PFRS definition of a "fireman"; and

  3. are currently enrolled in the Public Employees' Retirement System (PERS).

IMMEDIATE ACTION IS REQUIRED

  • A Resolution form, a Roster of Eligible Firefighters Adobe PDF (36K), and a Chapter 326 Retirement System Election Form Adobe PDF (19K) are enclosed with this letter.

    Eligible firefighters must be identified by their employer and any transfer of a firefighter's membership from the PERS to the PFRS is subject to the adoption of a resolution by the municipal governing body. Transfer also requires the submission of an Election Form from the member. These three documents must be returned to the Division of Pensions and Benefits and postmarked no later than April 1, 2006.

  • Employers are required to return the Roster of Eligible Firefighters Adobe PDF (36K) to the Division of Pensions and Benefits verifying eligible firefighters, even if your municipal governing body does not intend to adopt the provisions of Chapter 326. Please check the appropriate box on the Roster to indicate your employing location's status in regards to Chapter 326; i.e. No eligible firefighters; Election not to participate; or Election to participate - and list all of the requested identifying information for eligible firefighters. Please also be certain that the employing municipality's name is indicated and that it is signed and dated by the Certifying Officer.

  • The transfer of a firefighter's membership from the PERS to the PFRS is subject to the prior approval of the municipal governing body. Therefore, no eligible firefighter may transfer membership under Chapter 326 until the Division of Pensions and Benefits receives a resolution from the municipal governing body adopting the provisions of the law.

    Note: Failure by a municipality to return the Roster of Eligible Firefighters Adobe PDF (36K) and/or Resolution Adobe PDF (22K) will be considered to serve as an indication that the municipality is not adopting Chapter 326 and will waive all rights to participation under this law.

  • If your municipality is adopting the provisions of Chapter 326, all eligible firefighters are required to submit a completed Chapter 326, Retirement System Election Form Adobe PDF (19K)whether they wish to transfer membership or not. It is the adopting employer's responsibility to ensure that each firefighter listed on the Roster of Eligible Firefighters Adobe PDF (36K) submits a completed Retirement System Election Form. Please provide the election form to your eligible firefighters and return them with your completed Roster of Eligible Firefighters Adobe PDF (36K) and Resolution Adobe PDF (22K).

    Note: failure by an employee to file the Retirement System Election Form Adobe PDF (19K) will be considered to serve as the waiver of all transfer rights to the PFRS under Chapter 326.

  • Also enclosed with this letter is a copy of the Chapter 326 Information For Eligible Firefighters Adobe PDF (29K) - a flier that outlines some important points about the law and the transfer of membership. Please provide this information to your eligible firefighters to assist them in determining whether or not they should transfer their membership to the PFRS.
Important: Completed Roster of Eligible Firefighters Adobe PDF (36K) and, if applicable, the adopted Resolution Adobe PDF (22K) and completed Retirement System Election Forms must be postmarked no later than April 1, 2006.

Employers are also responsible for assuring that a PFRS Enrollment Application, Application for Interfund Transfer Adobe PDF (10K), and a current PFRS Report of Examining Physician (10K) form are submitted to the Division of Pensions and Benefits for each transferring firefighter. These three forms should be submitted as soon as possible, but can be sent to the Division after the April 1, 2006 deadline for rosters.

Employers should send all completed documents the attention of Michael Spadaro, Enrollment Bureau, Division of Pensions and Benefits, PO Box 295, Trenton, NJ 08625-0295. To help assure timely delivery and processing, please mark the envelope "Personal and Confidential".

ADDITIONAL PROVISIONS OF CHAPTER 326

  • If an eligible firefighter elects to transfer membership under this law, the transfer will be effective on August 1, 2006 ("the first day of the first full calendar month following the effective date of this act by at least 180 days"). Employers should be prepared to end PERS member contributions as of July 31, 2006 (pending confirmation of the transfer).

  • The accrued PERS service credit of transferring firefighters will be transferred to the PFRS and can be used to meet the service credit requirements for qualification for benefits under the PFRS.

  • Retirement is mandatory at age 65 for members of the PFRS. Eligible firefighters contemplating transfer to the PFRS under this legislation - especially members who, because of their age, would not expect to achieve 25 years of PFRS service credit before age 65 - should carefully consider the retirement benefits provided under both the PERS and the PFRS.

  • Eligible firefighters who may qualify for a PERS Veteran Retirement should carefully consider the retirement benefits provided under both the PERS and the PFRS. If, because of age and service, they would qualify in the near future for a PERS Veteran Retirement, the member may find the PERS retirement benefit to their advantage. See the Chapter 326 Information For Eligible Firefighters Adobe PDF (29K) flier for more information.

  • The amount of any retirement benefit will be calculated as provided under the PFRS based upon the total amount of service credit accrued under the PFRS from the effective date of the transfer plus an additional benefit comparable to a PERS Service, Early, or Deferred Retirement benefit, as appropriate, based upon the age of the member at the time of retirement and the amount of PERS service credited to the member upon transfer to the PFRS.

  • Active and retired death benefits, Accidental Death benefits, and Ordinary and Accidental Disability Retirement benefits for firefighters transferring to the PFRS will be the benefits provided under the PFRS based upon the total amount of service credit accrued under the PFRS.

  • Transferring firefighters will be entitled to elect optional retirement allowances for the portions of the retirement benefit based upon PERS service credit as provided under the laws and regulations governing selection of optional retirement allowances under the PERS. See Fact Sheet #5, Pension Options Adobe PDF (58K), for more information.

  • A firefighter who transfers membership from the PERS to the PFRS may receive full PFRS credit toward the calculation of benefits for the transferred PERS service if the member agrees to pay the full cost of the accrued liability for the transferred PERS service. The cost of converting the PERS service to PFRS service is calculated in the same manner and subject to the same terms and conditions provided for the purchase of service credit for Military Service under the PFRS (this is a Full Cost purchase, see Fact Sheet #3, Estimating the Cost of Purchasing Service Credit Adobe PDF (30K), for more Information).

  • The law provides that neither employers nor the State will be liable for any cost of the accrued liability that results from transfers under this law. Any costs due for converting transferred PERS service to full PFRS credit (as described above) is to be paid in full by the member.

ADDITIONAL INFORMATION

If you have additional questions regarding employer compliance with Chapter 326, or any of the information provided in this letter, contact the Division's Office of Client Services at (609) 292-7524, or e-mail the Division.


February 2006

TO: Certifying Officers New Jersey State-Administered Retirement Systems
FROM: Janice Curtin, Assistant Director, Pension Operations
Division of Pensions and Benefits
SUBJECT: Revised Certificate of Member Term Life Benefits

The Division of Pensions and Benefits provides a Group Life Insurance benefit to eligible members of the State-administered retirement systems.

Shortly after enrollment, new members of the retirement systems are mailed an Insurance Rider to confirm Group Life Insurance coverage. Along with the rider, the Division is now including the enclosed memorandum Adobe PDF (13K) that describes the Certificate of Member Term Life Coverage - recently revised and re-issued by the insurance carrier (Prudential Group Life Insurance).

In the memorandum it is suggested that employees print and keep a copy of the Certificate, and the Insurance Rider, with their important papers. Therefore, the Division of Pensions and Benefits is making the Certificates of Member Term Life Coverage available for viewing and/or printing through our Web site at: www.state.nj.us/treasury/pensions/gli.shtml

We have also included a small supply of the Certificates with this letter for you to have on hand for reference or to provide to new members who cannot access the Internet. You may request additional copies of the Certificate of Member Term Life Coverage or other publications by calling the Employer Forms Request Hotline at (609) 777-4357.

We also ask that you discard any of the old insurance policy booklets that you may have on hand.*

*Please verify that you are also using the current Enrollment Applications and Report of Transfer forms which are available on our Web site. The new documents are now required by the Division for all enrollment/transfer transactions.

The Division appreciates your assistance in helping to provide your employees with this important information about their benefits. If you or your employees have any further questions regarding the information described in this letter, contact the Division's Office of Client Services at (609) 292-7524, or e-mail the Division.

Enclosure Adobe PDF (13K)


 
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