The Modified Benefit Option Special Open Enrollment Dates: September - PowerPoint PPT Presentation

Human Resources The Modified Benefit Option Special Open Enrollment Dates: September 23 – October 4, 2019 www.SBCounty.gov

The Modified Benefit Option Page 2 • The Modified Benefit Option (MBO) is an alternative benefit package available to select job classifications throughout the County that provides a higher wage in lieu of some County-paid benefits. • MBO was first established in December 2015, and is now available to you effective September 14, 2019.

MBO Overview Page 3 Paid Time Off (PTO) instead of separate use-specific leave Higher pay banks (i.e., sick, vacation, and holiday) The MBO provides Slightly reduced Medical Double-time for all hours worked Premium Subsidy (MPS), while on holidays, not limited to 8 employees: maintaining the same health hrs./holiday* coverage Higher pensionable salary *For employees who are regularly scheduled to work holidays. All other employees receive 13 paid holidays.

Potential Benefits of the MBO Page 4 Higher Additional pay is included in: Pay - Overtime - Qualified differentials that are paid on a percentage basis - Retirement Benefit Amount - County contribution to the Retirement Medical Trust (RMT) - Sick leave cash-outs pursuant to RMT - Leave cash-outs

Potential Benefits of the MBO Page 5 Higher Employees can increase their pay while maintaining their current HMO Platinum plan Pay (i.e. Kaiser HMO, Blue Shield HMO Plans), (cont.) OR Employees can increase their pay even more by electing the low-premium, high-deductible Blue Shield PPO Bronze Plan.

Potential Benefits of the MBO Page 6 Employee Only example: Eligibility Worker II enrolled in Employee-Only medical plan may increase pay by approximately $2,000 to $4,500 per year . MBO – TBO - MBO - MBO - Annual HMO Platinum Plan HMO Platinum Plan HMO Gold Plan PPO Bronze Plan A) Salary $49,296 $52,936 $52,936 $52,936 Medical Premium (2019/20) $6,745 $6,745 $5,860 $3,835 Medical Premium Subsidy (MPS) -$5,923 -$4,206 -$4,206 -$4,206 Provided by County B) Employee's Share of Premium $822 $2,539 $1,654 $0 C) Approximate Pay After $48,474 $50,397 $51,282 $52,936 Employee's Share of Premium Potential Annual Increase $1,923 $2,808 $4,462

Potential Benefits of the MBO Page 7 Employees have the option to select the Blue Shield PPO Bronze Plan with a FSA FSA County match of up to $650 per year* to help pay medical plan deductibles, co-insurance payments, and other eligible medical expenses, with County election of the Bronze Plan** Match FSA County match of up to $260 per year with election of the Blue Shield Access + or Kaiser Choice Plan Employees who elect one of these eligible plans and currently enroll in FSA will receive County’s match. FSA enrollment is not available for this special open enrollment, however, employees can enroll in FSA during 2020 open enrollment or due to a qualifying event to receive the County’s match .

Potential Benefits of the MBO Page 8 Paid In lieu of separate specific-use leave banks. PTO allows employees: Time Greater flexibility in use Off To maintain and utilize existing leave balances (i.e., sick, holiday, vacation) (PTO) To accrue PTO hours beyond the max allowed unused vacation balance Greater cash-out value

Potential Benefits of the MBO Page 9 Paid Time Off (PTO) (cont.)  Greater cash-out value  Employees can maintain and use • 100% of PTO hours can be cashed-out upon existing leave balances separation • No minimum years-of-service requirement Example 1 : An employee who needs to code time for cash-out of PTO for not working on a fixed holiday can code existing unused vacation and holiday hours for that holiday. Example : Employees can cash-out 100% of Example 2 : An employee who is ill and has a PTO regardless of years of service, unlike sick significant amount of sick leave hours and wants to preserve PTO hours for their cash-out value or to leave which requires employees to have 10 use for vacation/personal time can use existing years of service and only converts up to 60% unused sick time instead of PTO. of its value to the Retirement Medical Trust.

Potential Benefits of the MBO Page 10 Paid Time Off (PTO) (cont.) Comparison of Teamsters Units’ Leave Banks and PTO Annual Accruals *: NOTE: EMPLOYEES ELIGIBLE FOR ANNUAL/ADMIN/ATTORNEY LEAVE WILL CONTINUE ACCRUING SUCH LEAVE. Approximate Years of TBO MBO Max Allowed Max Allowed Combined County Service Leaves PTO Unused PTO Vacation and PTO Balance Sick - 88 hrs PTO - 112 hrs Leaves < 4 Years Vacation - 80 hrs Holiday - 104 hrs PTO - 169 hrs PTO - 201 hrs PTO: < 4 Years Holiday - 112 hrs Total - 216 hrs Total - 280 hrs Sick - 88 hrs PTO - 152 hrs Leaves 4 - 9 Years Vacation - 120 hrs PTO - 229 hrs Holiday - 104 hrs PTO - 272 hrs PTO: 4 - 9 Years Holiday - 112 hrs Total - 256 hrs Total - 320 hrs Sick - 88 hrs PTO - 192 hrs Vacation - 160 hrs Leaves: 9+ Years Holiday - 104 hrs PTO - 289 hrs PTO - 343 hrs PTO: 9+ Years Holiday - 112 hrs Total - 296 hrs Total - 360 hrs *Employees who work less than 80 hrs per pay period will accumulate PTO on a pro-rata basis.

Potential Benefits of the MBO Page 11 Paid Time Off (PTO) (cont.) Employees can accrue PTO hours beyond the max allowed unused vacation balance Example : An employee with 11 years of service who has reached the maximum allowed unused vacation time (i.e., 320 hrs.), may accrue PTO hours under the MBO until a combined total of 343 hours is reached. Consequently, the employee’s bank of hours and the amount that may be cashed-out upon separation also increases. Vacation/PTO Hours TBO - Max Allowed Unused Vacation 320 Note: Holiday and sick time are not included in the total MBO - PTO Hours Employee Is Able To Accrue Until Combined Max is Reached 23 maximum combined unused leave/PTO hours. Max Combined Unused Leave/PTO Hours 343

Potential Benefits of the MBO Page 12 Retirement Benefit Amount Examples of potential retirement benefit amount for a Tier 1 (hired before 1/1/2013) Eligibility Worker Supervisor I when MBO is elected: Retire at 55 Retire at 59 Retire at 65 Rate 60% Rate 74.19% Rate 94.01% • Annual Pension • Annual Pension • Annual Pension Increase = $2,184 Increase = $2,701 Increase = $3,422 • Monthly Pension • Monthly Pension • Monthly Pension Increase = $285 Increase = $182 Increase = $225 *Assumes a Tier 1 EWS I with 30 years of service at top step upon retirement. Highest Annual Salaries: Traditional salary = $58,510.40 and MBO = $62,150.40 based on 9/14/2019 rates .

Other Benefits You Remain Eligible for if Electing MBO Page 13 Employees who select the MBO remain eligible for all other County benefits including: Vision Life Dental insurance Opt- Insurance Premium (100% out/Waive refer to your Short-Term Subsidy County paid pay (same BBOU for Disability (same for Employee amount) Coverage amount) Only amount Coverage)

Employee Considerations When Electing MBO Page 14 Is the employee a frequent user of their medical plan and do they have a lot of medical expenses? • If so, they may want to consider MBO while keeping a Platinum plan, paying slightly more for health premiums, which would be offset by the increase in income. Does the employee utilize most of their leave bank hours (vacation, sick, and holiday)? • MBO provides approximately 2/3 of hours provided by the TBO. • The employee must consider if the PTO hours provided by the MBO and any existing unused leave hours are sufficient for their time-off needs.

Employees Who May Benefit From MBO Page 15 Are near retirement and want to Want the flexibility Need extra income maximize their provided by PTO pension and lifetime earnings Employees who may Do not exhaust their Opt-out/waive Often work holidays benefit from leave banks medical coverage MBO : Are low health-care consumers/have low medical expenses (may benefit from Bronze Plan)

Summary of MBO Page 16 Accrue PTO hours, providing flexible time-off Maximize employee’s and the opportunity to Increase employee’s pay pension and lifetime accrue time-off hours earnings beyond the allowed maximum unused leave balance