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Pensions and Benefits
CERTIFYING OFFICER LETTERS 2015

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

SUBJECT DATE
Employer Repsonsibility: Affordable Care Act (ACA) - Certifying Officers, All Local Employers participating in the State Health Benefits Program (SHBP) and School Employees' Health Benefits Program (SEHBP) November 17, 2015
Employer Repsonsibility: Affordable Care Act (ACA) - Certifying Officers, State Locations October 26, 2015
Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2016) - State Department Certifying Officers, State Department Human Resource Directors, State Biweekly Payroll Locations Benefits Administrators September 28, 2015
Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2016) - State University and College Certifying Officers, State University and College Benefits Administrators, State Monthly Certifying Officers, State Monthly Benefits Administrators September 28, 2015
Renewal Required for Annual Membership Certification Required under Chapter 52, P.L. 2011 - Certifying Officers and Supervisors of Certifying Officers September 17, 2015
Annual Meeting for Colleges and Universities - Certifying Officers, Human Resources Personnel, County Colleges September 11, 2015
Annual Meeting for Colleges and Universities - Certifying Officers, Human Resources Personnel, State Colleges September 11, 2015
SEHBP Open Enrollment for Plan Year 2016 - Local Education Certifying Officers, Human Resource Representatives, and Benefits Administrators September 11, 2015
SHBP Open Enrollment for Plan Year 2016 - Local Government Certifying Officers, Human Resource Representatives, and Benefit Administrators September 11, 2015
SHBP Open Enrollment for Plan Year 2016 - State Biweekly and Monthly Certifying Officers, Human Resource Directors, and Benefit Administrators September 11, 2015
PERS Notice of Election - Certifying Officers of the Public Employees' Retirement System (PERS) September 10, 2015
PFRS Notice of Election - Certifying Officers of the Police and Firemen's Retirement System (PFRS) September 10, 2015
Alternate Benefit Program (ABP), Annual Report of Covered Lives - 2015 - Certifying Officers, Alternate Benefit Program July 7, 2015
Fiscal 2015 Alternate Benefit Program Default Designated Service Provider - Certifying Officers, State and County Colleges and Universities June 10, 2015
Pension Contribution Rate Change for JRS - Certifying Officers of the Judicial Retirement System (JRS) June 2, 2015
Pension Contribution Rate Change for PERS and TPAF - Certifying Officers of the Public Employees' Retirement System (PERS) and the Teachers' Pension and Annuity Fund (TPAF) June 2, 2015
Affordable Care Act (ACA), Employer Shared Responsibility Provisions and Reporting Requirements - Certifying Officers, State Colleges and Universities March 31, 2015
Affordable Care Act (ACA), Employer Shared Responsibility Provisions and Reporting Requirements - Certifying Officers, Human Resources Directors, and Benefits Administrators Participating in the State Health Benefits Program (SHBP) and School Employees' Health Benefits Program (SEHBP) March 31, 2015
PFRS Notice of Election - Certifying Officers of the Police and Firemen's Retirement System (PFRS) March 12, 2015
Special Provisions Related to JRS, PERS Judges of Workers' Compensation, PERS Administrative Law Judges and Bona Fide Severence of Employment - Certifying Officers of the Judicial Retirement System (JRS), the Workers' Compensation Judges (WCJ) Part of the Public Employees' Retirement System (PERS), and the Office of Administrative Law (OAL) January 23, 2015

CERTIFYING OFFICER LETTERS FROM OTHER YEARS

2017 CO Letters 2016 CO Letters 2015 CO Letters 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.

 


November 17, 2015

TO: Certifying Officers, All Local Employers participating in the State Health Benefits Program (SHBP) and School Employees' Health Benefits Program (SEHBP)

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: Employer Responsibility: Affordable Care Act (ACA)

Employer Shared Responsibility Provisions in the ACA:

According to the Employer Shared Responsibility Provisions in the Affordable Care Act (ACA), effective January 1, 2015, applicable large employers (defined as those with at least 50 “full-time” or “full-time equivalent” employees) may face a penalty if they do not offer their full-time employees the opportunity to enroll in health care coverage that meets a standard of “affordability” and provides the employee with “minimum value.” 

To determine whether employers are in compliance with the Employer Shared Responsibility Provisions, and to calculate and assess Employer Shared Responsibility Payments for employers who are not in compliance, the Internal Revenue Service (IRS) will require employers to file yearly returns under sections 6055 and 6056 of the Internal Revenue Code.  These returns will require employers to provide information on their full-time employees as well as the standards and conditions of any health coverage offered by the employer. 

Liability for Employer Shared Responsibility Payments:
Applicable large employers may be assessed an Employer Shared Responsibility Payment, under section 4980H of the Internal Revenue Code by the IRS, if:

  • The employer does not offer health coverage to substantially all (70% in 2015 and 95% thereafter) of its full-time employees (those averaging 30 hours of work per week or more) and their children, and at least one of the employer’s full-time employees receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace.
  • The monthly penalty is equal to the total number of full-time employees employed by the employer (minus the first 30) multiplied by 1/12 of $2,000. 

The employer does offer health coverage to substantially all of its full-time employees and their children, but the coverage is unaffordable or does not provide minimum value to at least one full-time employee who receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace.

  • The penalty is calculated separately each month and is equal to the number of full-time employees who get coverage through a Health Insurance Marketplace and receive a premium tax credit to pay for their coverage multiplied by 1/12 of $3,000. The payment owed in this scenario cannot exceed the amount that the employer would have paid had it not offered coverage at all.

Your Organization as an Applicable Large Employer:
For the purposes of determining whether an employer qualifies as an applicable large employer subject to the Employer Shared Responsibility Provisions in the ACA, employers must add the total number of their “full-time employees” to the total number of their “full-time equivalent employees.”  The IRS defines a “full-time employee” as those who average 30 or more hours of work per week.  This determination is generally made during a look-back period that the employer chooses to use.  IRS regulations require all applicable employers to report any employee who meets their definition of “full-time.” 

In addition to reporting on employment status, the IRS will also require reporting on the health coverage offered to “full-time” employees.  To assist with reporting, the Division of Pensions and Benefits has provided employers with a data file in EPIC containing Plan Year 2015 information on employees who had coverage under the SHBP/SEHBP, along with all covered dependents.  The test data file is currently available for all SHBP/SEHBP participating employers to view (Please see below for instructions to access data file).  In the event that a covered employee experiences a coverage level or dependent status change (death, divorce, addition/deletion of a dependent) before the end of the year, the Division will release a second data file containing the updated employee information.  It is the responsibility of the employer to note any status changes and to utilize the updated information when it is provided.  The updated file will be made available in early January. 

Please Note: It is the obligation of each employer to ensure the accuracy and timely submission of the appropriate forms to the IRS.   Any liability that is assessed due to improper, delayed, or incorrect reporting is the sole responsibility of the employer.  The Division of Pensions and Benefits will assume no responsibility if a participating employer is penalized by the IRS.  This document should not be used as a substitute for professional advice on ACA requirements or IRS reporting. 

To Access The Data File:

- The ACA data file is located under the “SHBP/SEHBP” link on your EPIC Home Page.  On the SHBP/SEHBP page, select “Year-End Reports”.  Once you access your year-end reports, select the appropriate bureau number (if applicable), select ACA Dependent(s) Report, and “2015” as the year, then click “Submit”.

- The next page will state the name and year of the file that you have selected.  If it is the correct file, click on “CSV Report”.

- The next page will provide you with a disclaimer from the Division of Pensions and Benefits.  Please ensure that you read this information carefully.  To access the data file, you must click on “Agree”, which confirms your agreement with the information provided in the disclaimer.

For any additional questions regarding the information provided, please send your inquiry to ACANJ@treas.nj.gov.

CO Letter in Printable Format Adobe PDF (287K)

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October 26, 2015

TO: Certifying Officers, State Locations

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: Employer Responsibility: Affordable Care Act (ACA)

Employer Shared Responsibility Provisions in the ACA:

According to the Employer Shared Responsibility Provisions in the Affordable Care Act (ACA), effective January 1, 2015, applicable large employers (defined as those with at least 50 “full-time” or “full-time equivalent” employees) may face a penalty if they do not offer their full-time employees the opportunity to enroll in health care coverage that meets a standard of “affordability” and provides the employee with “minimum value.”

To determine whether employers are in compliance with the Employer Shared Responsibility Provisions, and to calculate and assess Employer Shared Responsibility Payments for employers who are not in compliance, the Internal Revenue Service (IRS) will require employers to file yearly returns under sections 6055 and 6056 of the Internal Revenue Code. These returns will require employers to provide information on their full-time employees as well as the standards and conditions of any health coverage offered by the employer.

Liability for Employer Shared Responsibility Payments:

Applicable large employers may be assessed an Employer Shared Responsibility Payment, under section 4980H of the Internal Revenue Code by the IRS, if:

  1. a) The employer does not offer health coverage to substantially all (70% in 2015 and 95% thereafter) of its full-time employees (those averaging 30 hours of work per week or more) and their children, and at least one of the employer’s full-time employees receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace.
  2. The monthly penalty is equal to the total number of full-time employees employed by the employer (minus the first 30) multiplied by 1/12 of $2,000.

  3. b) The employer does offer health coverage to substantially all of its full-time employees and their children, but the coverage is unaffordable or does not provide minimum value to at least one full-time employee who receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace.
  4. The penalty is calculated separately each month and is equal to the number of full-time employees who get coverage through a Health Insurance Marketplace and receive a premium tax credit to pay for their coverage multiplied by 1/12 of $3,000. The payment owed in this scenario cannot exceed the amount that the employer would have paid had it not offered coverage at all.

The State of New Jersey as an Applicable Large Employer:

For the purposes of determining whether an employer qualifies as an applicable large employer subject to the Employer Shared Responsibility Provisions in the ACA, employers must add the total number of their “full-time employees” to the total number of their “full-time equivalent employees.” The IRS defines a “full-time employee” as those who average 30 or more hours of work per week. This determination is generally made during a look-back period that the employer chooses to use. Viewed as a single organization, the State of New Jersey easily exceeds 50 full-time employees, and it is therefore considered to be an applicable large employer.

IRS regulations require the State to report all employees who meet their definition of “full-time.” However, the IRS does not require that all of these employees receive an offering of coverage. For the purpose of efficiency and to conform to the 95% coverage requirement, the State has elected to use the definition of full time employee as currently described under New Jersey Administrative Code, N.J.A.C. 17:9-4.2 (2015). Operating under this definition of full-time employment, the State will offer coverage to all of its full-time employees covered under payroll compensation codes 1, 2, and 3. Additionally, in accordance with N.J.A.C 17:9-4.4 (2015), no coverage will be offered to employees who are considered ineligible (employees paid under compensation codes 6, 7, and 8). State employees paid under compensation codes 6, 7, or 8, who were identified in the previous look-back period and currently have coverage under the State Health Benefits Program, will be grandfathered and continue to be offered coverage provided that they meet the IRS definition of “full-time” employee during every look-back period. Coverage will not be offered to newly identified employees in any current or future look-back period. By adhering to the New Jersey Administrative Code, the State will satisfy the IRS requirement of providing affordable coverage to over 95% of employees while also maintaining previous standards for full-time employment.

Please Note: Only employees who meet the full-time definition under the New Jersey Administrative Code are eligible for retired health benefit offerings. State employees covered under ineligible payroll codes will not be offered coverage, regardless of their coverage as an active member.

For any additional questions regarding the information provided, please send your inquiry to ACANJ@treas.nj.gov.

CO Letter in Printable Format Adobe PDF (50K)

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September 28, 2015

TO: Certifying Officers and Supervisors of Certifying Officers, State Department Certifying Officers, State Department Human Resource Directors, State Biweekly Payroll Locations Benefits Administrators

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2016)

The annual open enrollment for the calendar year 2016 New Jersey State Employees Tax Savings Program (Tax$ave 2016) will begin October 1 and ends on November 2, 2015.  A benefit program available under Section 125 of the Federal Internal Revenue Code, Tax$ave offers eligible employees the opportunity to increase their available income by reducing their federal tax liability. 

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. 

Note: Chapter 78, P.L. 2011, the Pension and Health Benefit Reform Law, requires local government and local education employers to offer Section 125 plans to their employees. Because Tax$ave is only available to State employees, local employers are required establish their own Section 125 programs. Local government and local education employees can contact their human resources office or benefits administrator to determine the specific plans and benefits that are available.

ABOUT TAX$AVE

Tax$ave consists of three components:
1. The Premium Option Plan (POP);
2. The Unreimbursed Medical Flexible Spending Account; and
3. The Dependent Care Flexible Spending Account. 

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, for details.

PREMIUM OPTION PLAN

Enrollment in the Premium Option Plan is automatic.  This plan saves your employees 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 2016 (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 and/or Dependent Care Flexible Spending Accounts (FSA) allow employees to set aside money to pay for out-of-pocket medical, dental, and dependent care expenses while saving on taxes because the money contributed to the account is free from federal income, Social Security, and Medicare taxes and remains tax-free when an employee receives it.  WageWorks, Inc. administers the Tax$ave Unreimbursed Medical and Dependent Care FSAs for the Division of Pensions and Benefits.

Unlike the Premium Option Plan or the health plans of the SHBP, prior participation in a Tax$ave FSA in 2015 does not carry over automatically into 2016.  Employees must enroll each year with WageWorks to participate in an FSA for calendar year 2016. 
Some of the benefits of FSA participation include:

  • $2,500 Medical FSA Maximum and $5,000 Dependent Care FSA Maximum.  For the Tax$ave 2016 plan year, the maximum annual allowance that can be set aside for an Unreimbursed Medical FSA is $2,500 and the maximum annual allowance that can be set aside for a Dependent Care FSA is $5,000.  Employees may save federal income, Medicare and Social Security taxes on up to $7,500 of combined unreimbursed medical and dependent care expenses.  It makes sense to enroll and use a Tax$ave FSA plan when paying for doctor and prescription copayments, health plan deductibles, orthodontics, eyeglasses, Lasik surgery, uncovered dental fees, certain over-the-counter items (see page 3), or dependent care. 
  • Medical FSA Eligibility includes Adult Children until Age 26.  Qualified out-of-pocket medical expenses incurred by eligible adult children can be reimbursed through the Unreimbursed Medical FSA.  Coverage applies until the end of the year in which a child turns age 26, regardless of the child’s marital or student status.
  • Grace Period Extension for Eligible Expenses and Extended Claim Filing Period.  Employees enrolled in the Unreimbursed Medical or Dependent Care FSAs 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 extends to April 30 of the following year.  While this does not eliminate the use-it-or-lose-it rule completely, employees have an extended period to obtain reimbursement for eligible expenses and avoid forfeiting unused funds.  Under the Unreimbursed Medical and Dependent Care Flexible Spending Accounts, any contributions that remain unclaimed after the April 30 extended deadline are forfeited.
  • Unreimbursed Medical FSAs feature the WageWorks Health Care Card® that draws on the value of the employee’s annual Medical FSA election amount.  The WageWorks Health Care Card is included free when you sign up for the Unreimbursed Medical FSA during Tax$ave Open Enrollment.  Employees can use the WageWorks Health Care Card for qualifying expenses, such as covered prescription copayments, health plan deductibles, orthodontics, doctor and emergency room copayments, eyeglasses, Lasik surgery, and uncovered dentist or other provider fees.  The WageWorks Health Care Card can also be used for certain eligible over-the-counter medical expenses (see below) at grocery stores, drugstores, and discount stores that are IIAS (Inventory Information Approval Systems) certified merchants. 
  • Look Back Feature. The WageWorks Health Care Card also contains a “look back” feature during the 2½ month grace period extension that will access any unused 2015 Unreimbursed Medical FSA funds to reimburse eligible expense incurred prior to March 15, 2016 before using funds contributed in the 2016 plan year.

Prescription Required for Reimbursement of Over-the-Counter Items

The federal Patient Protection and Affordable Care Act requires a prescription for any eligible Over-the-Counter (OTC) drug or medicine (except diabetic supplies) before it will qualify for reimbursement under the Unreimbursed Medical FSA.  This includes OTC items like: allergy drugs, pain relievers, cold and cough medicines, sleep aids, digestive aids, anti-gas medications, baby rash creams, and insect bite treatments.  To be reimbursed for these types of OTC items through the Unreimbursed Medical FSA, you must submit a copy of your doctor’s prescription along with your Claim Form for verification (eligible items requiring a prescription may be purchased using the WageWorks Health Care Card if the prescription is used to purchase it).  OTC items like eyeglasses, wrist splints, and bandages, as well as durable medical items such as crutches and canes continue to be reimbursed without a prescription.

Enrolling in a Flexible Spending Account

Employees have three ways of enrolling in the Tax$ave FSA accounts during the Open Enrollment: mail, fax, and Internet.  WageWorks will inform employees currently participating in a Tax$ave FSA plan of this enrollment opportunity through e-mail or direct mailing in September.  The Tax$ave publications also provide the following enrollment instructions to employees:

  • Internet: Employees can enroll in the Unreimbursed Medical and/or Dependent Care FSA plans over the Internet at: www.wageworks.com  The deadline for enrollment over the Internet is midnight, November 2, 2015.
  • Fax: FSA Enrollment Forms may be faxed by the employee to 1-866-672-4780.  The deadline for accepting faxed enrollment forms is midnight, November 2, 2015. 
  • Mail: FSAEnrollment Forms can be mailed by the employee directly to WageWorks, Enrollment Processing, PO Box 1840, Tallahassee, FL, 32302-1840. To be accepted, enrollment forms must be postmarked no later than November 2, 2015.  Forms postmarked after November 2, 2015 will be returned without action.  Employer benefits offices should not be involved in processing or mailing FSAEnrollment Forms.

For more information about the FSA plans see the Division of Pensions and Benefits’ Tax$ave Web page at: www.nj.gov/treasury/pensions/taxsave.shtml or contact WageWorks Customer Service at 1-855-428-0446.

Special Rules for Enrolling Newly Hired Employees — New employees can enroll in Tax$ave FSA plans when hired but must complete an FSA Enrollment Form within 30 days of the date of hire to participate in either the Unreimbursed Medical FSA or the Dependent Care FSA. 

  • There is a 60 day waiting period for Unreimbursed Medical FSA eligibility. 
  • There is a 30 day waiting period for Dependent Care FSA eligibility. 

The effective date will be the first day of the month following eligibility.  If the employee misses the 30 day enrollment window, they must wait to enroll during the Tax$ave Open Enrollment.

TAX$AVE AND CIVIL UNION PARTNERS OR DOMESTIC PARTNERS

The Internal Revenue Service (IRS) now recognizes a marriage of same-sex spouses for federal tax purposes — including the tax saving benefits available through Tax$ave. 

This recognition, however, does not include a civil union partner or same-sex domestic partner.  Before any payroll contributions or premiums that an employee pays for a partner’s SHBP medical or dental coverage can be made on a pre-tax basis under the Tax$ave Premium Option Plan, the civil union partner or domestic partner must be able to qualify as a “tax dependent” of the employee for federal tax filing purposes under Internal Revenue Code Section 152.

Similarly, the civil union partner or domestic partner must qualify as the employee’s tax dependent before an out-of-pocket medical expense incurred by the partner can be reimbursed under the Unreimbursed Medical Flexible Spending Account. 

If the civil union partner or domestic partner is not a “qualified tax dependent” of the employee, any premium deductions made for the partner’s coverage must be made on an after-tax basis and funds in the Unreimbursed Medical Spending Account cannot be used to cover the partner’s medical expenses.

See IRS Publication #503, Dependents, at: www.irs.gov for information on the requirements for establishing dependent status for federal tax purposes. 

Information about New Jersey Civil Unions can be found in Fact Sheet #75, Civil Unions.  Information about New Jersey Domestic Partners can be found in Fact Sheet #71, Benefits under the Domestic Partnership Act.  Both fact sheets are available on the Division of Pensions and Benefits Web site: www.nj.gov/treasury/pensions

TAX$AVE AND CHILDREN AGE 26 TO 31

Chapter 375, P.L. 2005, permits continued SHBP medical plan coverage for certain children until their 31st birthday.  However, contributions or premiums that an employee pays for coverage of an over age child cannot be made on a pre-tax basis under the Tax$ave Premium Option Plan, nor can an out-of-pocket medical expense incurred by the over age child be reimbursed under the Unreimbursed Medical Flexible Spending Account, unless the child qualifies as a “tax dependent” of the employee for federal tax filing purposes under Internal Revenue Code Section 152.  See IRS Publication #503, Dependents, at: www.irs.gov for information on the requirements for establishing dependent status for federal tax purposes. 

Information about continued coverage for children age 26 to 31, can be found in Fact Sheet #74, Health Benefits Coverage of Children Until Age 31 Under Chapter 375.

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. 

Milestones
Enclosed is the Tax$ave Open Enrollment Milestones chart that lists the critical dates of the Tax$ave 2016 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.

Check Messages
Announcement of the open enrollment to employees paid through Centralized Payroll will be made with a paycheck messages on the September 11 and September 25 payroll statements.

An additional “reminder message” will be provided to employees through a paycheck message on October 23.  The text of the check message announcements and preview copies of the Tax$ave publications are enclosed with this letter.

Online Distribution of Tax$ave Newsletter and Open Enrollment Fliers
In compliance with State initiatives to provide paperless services, the Tax$ave 2016 Newsletter, Premium Option Plan (POP) Flier, and FSA Plan Flier are only available in electronic format for this year’s Open Enrollment. 

  • The Tax$ave 2016 Open Enrollment News announces the open enrollment, outlines the components of the program with an emphasis on its tax saving advantages, and identifies the November 2, 2015 deadline for submission of all enrollment materials;
  • The Premium Option Plan 2016 flier explains the advantages and disadvantages of participation; and
  • The FSA Plan Flier describes the Unreimbursed Medical and Dependent Care Flexible Spending Accounts administered by WageWorks.

Access to the Tax$ave publications is available through links at the Division of Pensions and Benefits Web site: www.nj.gov/treasury/pensions/taxsave.shtml or as PDF attachments provided with the distribution of this letter.

Employers should inform employees to access the Open Enrollment information online or provide the PDF versions via e-mail attachment or your Departmental Intranet.

For cases where online or e-mail notification is not possible, a paper flier giving instructions on accessing the Open Enrollment publications is provided with this letter and can be copied and distributed as required.

Other open enrollment materials available to you are the FSA Reference Guide and the Declination of Premium Option Plan (POP) form. 

  • A small supply of the 2016 FSA Reference Guide and Enrollment Form will be sent directly to benefits administrators by WageWorks.  Please provide the FSA Reference Guide or Enrollment Form to any employee who requests them.

The FSA Reference Guide and Enrollment Form are also available online at: www.nj.gov/treasury/pensions/taxsave.shtml

  • This letter includes the Declination of Premium Option Plan (POP) form — which can be copied for use by those few employees who do not wish to participate in the POP and, therefore, pay more in tax.  Please 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 2016, they must complete the form declining the federal tax break they could receive.  Employees should request these forms from benefits administrators and return the Declination of Premium Option Plan (POP) forms to benefits administrators by November 2, 2015.  Benefits administrators must then forward declination forms to Centralized Payroll by November 13, 2015. 

As we do every year, the Division of Pensions and Benefits appreciates your cooperation in the Open Enrollment.  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 general questions about Tax$ave 2016, the open enrollment, or the Premium Option Plan, visit the Division of Pensions and Benefits’ Tax$ave Internet site at: www.nj.gov/treasury/pensions/taxsave.shtml call the Division’s Office of Client Services at (609) 292-7524, or send e-mail to: https://www.state.nj.us/treas/pensions/pensionmail.shtml

For more information about the Unreimbursed Medical or Dependent Care Flexible Spending Accounts, contact WageWorks at: www.wageworks.com or call WageWorks Customer Service at 1-855-428-0446.

Enclosures:
Tax$ave 2016 Open Enrollment News
The Premium Option Plan 2016 Flier
Tax$ave — WageWorks Flexible Spending Accounts Flier
Tax$ave — WageWorks Flexible Spending Accounts Enrollment Form

CO Letter in Printable Format Adobe PDF (50K)


September 28, 2015

TO: Certifying Officers and Supervisors of Certifying Officers, State University and College Certifying Officers, State University and College Benefits Administrators, State Monthly Certifying Officers, State Monthly Benefits Administrators

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: Open Enrollment For The New Jersey State Employees Tax Savings Program (Tax$ave 2016)

The annual open enrollment for the calendar year 2016 New Jersey State Employees Tax Savings Program (Tax$ave 2016) will begin October 1 and ends on November 2, 2015.  A benefit program available under Section 125 of the Federal Internal Revenue Code, Tax$ave offers eligible employees the opportunity to increase their available income by reducing their federal tax liability. 
Full-time employees of the State or a State college or university who are eligible for participation in the New Jersey State Health Benefits Program (SHBP) may participate in Tax$ave. 


Note: Chapter 78, P.L. 2011, the Pension and Health Benefit Reform Law, requires local government and local education employers to offer Section 125 plans to their employees. Because Tax$ave is only available to State employees, local employers are required establish their own Section 125 programs.  Local government and local education employees can contact their human resources office or benefits administrator to determine the specific plans and benefits that are available.

ABOUT TAX$AVE

Tax$ave consists of three components:
1. The Premium Option Plan (POP);
2. The Unreimbursed Medical Flexible Spending Account; and
3. The Dependent Care Flexible Spending Account. 

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, for details.

PREMIUM OPTION PLAN

Enrollment in the Premium Option Plan is automatic.  This plan saves your employees 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 2016 (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 and/or Dependent Care Flexible Spending Accounts (FSA) allow employees to set aside money to pay for out-of-pocket medical, dental, and dependent care expenses while saving on taxes because the money contributed to the account is free from federal income, Social Security, and Medicare taxes and remains tax-free when an employee receives it.  WageWorks Inc. administers the Tax$ave Unreimbursed Medical and Dependent Care FSAs for the Division of Pensions and Benefits.

Unlike the Premium Option Plan or the health plans of the SHBP, prior participation in a Tax$ave FSA in 2015 does not carry over automatically into 2016.  Employees must enroll each year with WageWorks to participate in an FSA for calendar year 2016. 
Some of the benefits of FSA participation include:

  • $2,500 Medical FSA Maximum and $5,000 Dependent Care FSA Maximum.  For the Tax$ave 2016 plan year, the maximum annual allowance that can be set aside for an Unreimbursed Medical FSA is $2,500 and the maximum annual allowance that can be set aside for a Dependent Care FSA is $5,000.  Employees may save federal income, Medicare and Social Security taxes on up to $7,500 of combined unreimbursed medical and dependent care expenses.  It makes sense to enroll and use a Tax$ave FSA plan when paying for doctor and prescription copayments, health plan deductibles, orthodontics, eyeglasses, Lasik surgery, uncovered dental fees, certain over-the-counter items (see page 3), or dependent care. 
  • Medical FSA Eligibility includes Adult Children until Age 26.  Qualified out-of-pocket medical expenses incurred by eligible adult children can be reimbursed through the Unreimbursed Medical FSA.  Coverage applies until the end of the year in which a child turns age 26, regardless of the child’s marital or student status.
  • Grace Period Extension for Eligible Expenses and Extended Claim Filing Period.  Employees enrolled in the Unreimbursed Medical or Dependent Care FSAs 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 extends to April 30 of the following year.  While this does not eliminate the use-it-or-lose-it rule completely, employees have an extended period to obtain reimbursement for eligible expenses and avoid forfeiting unused funds.  Under the Unreimbursed Medical and Dependent Care Flexible Spending Accounts, any contributions that remain unclaimed after the April 30 extended deadline are forfeited.
  • Unreimbursed Medical FSAs feature the WageWorks Health Care Card® that draws on the value of the employee’s annual Medical FSA election amount.  The WageWorks Health Care Card is included free when you sign up for the Unreimbursed Medical FSA during Tax$ave Open Enrollment.  Employees can use the WageWorks Health Care Card for qualifying expenses, such as covered prescription copayments, health plan deductibles, orthodontics, doctor and emergency room copayments, eyeglasses, Lasik surgery, and uncovered dentist or other provider fees.  The WageWorks Health Care Card can also be used for certain eligible over-the-counter medical expenses (see below) at grocery stores, drugstores, and discount stores that are IIAS (Inventory Information Approval Systems) certified merchants. 
  • Look Back Feature. The WageWorks Health Care Card also contains a “look back” feature during the 2½ month grace period extension that will access any unused 2015 Unreimbursed Medical FSA funds to reimburse eligible expense incurred prior to March 15, 2016 before using funds contributed in the 2016 plan year.

Prescription Required for Reimbursement of Over-the-Counter Items
The federal Patient Protection and Affordable Care Act requires a prescription for any eligible Over-the-Counter (OTC) drug or medicine (except diabetic supplies) before it will qualify for reimbursement under the Unreimbursed Medical FSA.  This includes OTC items like: allergy drugs, pain relievers, cold and cough medicines, sleep aids, digestive aids, anti-gas medications, baby rash creams, and insect bite treatments.  To be reimbursed for these types of OTC items through the Unreimbursed Medical FSA, you must submit a copy of your doctor’s prescription along with your Claim Form for verification (eligible items requiring a prescription may be purchased using the WageWorks Health Care Card if the prescription is used to purchase it).  OTC items like eyeglasses, wrist splints, and bandages, as well as durable medical items such as crutches and canes continue to be reimbursed without a prescription. 

Enrolling in a Flexible Spending Account
Employees have three ways of enrolling in the Tax$ave FSA accounts during the Open Enrollment: mail, fax, and Internet.  WageWorks will inform employees currently participating in a Tax$ave FSA plan of this enrollment opportunity through e-mail or direct mailing in September.  The Tax$ave publications also provide the following enrollment instructions to employees:

  • Internet: Employees can enroll in the Unreimbursed Medical and/or Dependent Care FSA plans over the Internet at: www.wageworks.com   The deadline for enrollment over the Internet is midnight, November 2, 2015.
  • Fax: FSAEnrollment Forms may be faxed by the employee to 1-866-672-4780.  The deadline for accepting faxed enrollment forms is midnight, November 2, 2015. 
  • Mail: FSAEnrollment Forms can be mailed by the employee directly to WageWorks, Enrollment Processing, PO Box 1840, Tallahassee, FL, 32302-1840.  To be accepted, enrollment forms must be postmarked no later than November 2, 2015.  Forms postmarked after November 2, 2015 will be returned without action.  Employer benefits offices should not be involved in processing or mailing FSAEnrollment Forms.

For more information about the FSA plans see the Division of Pensions and Benefits’ Tax$ave Web page at: www.nj.gov/treasury/pensions/taxsave.shtml or contact WageWorks Customer Service at 1-855-428-0446.

Special Rules for Enrolling Newly Hired Employees — New employees can enroll in Tax$ave FSA plans when hired but must complete an FSA Enrollment Form within 30 days of the date of hire to participate in either the Unreimbursed Medical FSA or the Dependent Care FSA. 

  • There is a 60 day waiting period for Unreimbursed Medical FSA eligibility. 
  • There is a 30 day waiting period for Dependent Care FSA eligibility. 

The effective date will be the first day of the month following eligibility.  If the employee misses the 30 day enrollment window, they must wait to enroll during the Tax$ave Open Enrollment.

TAX$AVE AND CIVIL UNION PARTNERS OR DOMESTIC PARTNERS

The Internal Revenue Service (IRS) now recognizes a marriage of same-sex spouses for federal tax purposes — including the tax saving benefits available through Tax$ave. 

This recognition, however, does not include a civil union partner or same-sex domestic partner.  Before any payroll contributions or premiums that an employee pays for a partner’s SHBP medical or dental coverage can be made on a pre-tax basis under the Tax$ave Premium Option Plan, the civil union partner or domestic partner must be able to qualify as a “tax dependent” of the employee for federal tax filing purposes under Internal Revenue Code Section 152.

Similarly, the civil union partner or domestic partner must qualify as the employee’s tax dependent before an out-of-pocket medical expense incurred by the partner can be reimbursed under the Unreimbursed Medical Flexible Spending Account. 
If the civil union partner or domestic partner is not a “qualified tax dependent” of the employee, any premium deductions made for the partner’s coverage must be made on an after-tax basis and funds in the Unreimbursed Medical Spending Account cannot be used to cover the partner’s medical expenses.

See IRS Publication #503, Dependents, at: www.irs.gov for information on the requirements for establishing dependent status for federal tax purposes. 

Information about New Jersey Civil Unions can be found in Fact Sheet #75, Civil Unions.  Information about New Jersey Domestic Partners can be found in Fact Sheet #71, Benefits under the Domestic Partnership Act.  Both fact sheets are available on the Division of Pensions and Benefits Web site: www.nj.gov/treasury/pensions

TAX$AVE AND CHILDREN AGE 26 TO 31

Chapter 375, P.L. 2005, permits continued SHBP medical plan coverage for certain children until their 31st birthday.  However, contributions or premiums that an employee pays for coverage of an over age child cannot be made on a pre-tax basis under the Tax$ave Premium Option Plan, nor can an out-of-pocket medical expense incurred by the over age child be reimbursed under the Unreimbursed Medical Flexible Spending Account, unless the child qualifies as a “tax dependent” of the employee for federal tax filing purposes under Internal Revenue Code Section 152.  See IRS Publication #503, Dependents, at: www.irs.gov for information on the requirements for establishing dependent status for federal tax purposes. 

Information about continued coverage for children age 26 to 31, can be found in Fact Sheet #74, Health Benefits Coverage of Children Until Age 31 Under Chapter 375.

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. 

Milestones
Enclosed is the Tax$ave Open Enrollment Milestones chart that lists the critical dates of the Tax$ave 2016 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.

Online Distribution of Tax$ave Newsletter and Open Enrollment Fliers
In compliance with State initiatives to provide paperless services, the Tax$ave 2016 Newsletter, Premium Option Plan (POP) Flier, and FSA Plan Flier are only available in electronic format for this year’s Open Enrollment. 

  • The Tax$ave 2016 Open Enrollment News announces the open enrollment, outlines the components of the program with an emphasis on its tax saving advantages, and identifies the November 2, 2015 deadline for submission of all enrollment materials;
  • The Premium Option Plan 2016 flier explains the advantages and disadvantages of participation; and
  • The FSA Plan Flier describes the Unreimbursed Medical and Dependent Care Flexible Spending Accounts administered by WageWorks.

Access to the Tax$ave publications is available through links at the Division of Pensions and Benefits Web site: www.nj.gov/treasury/pensions/taxsave.shtml or as PDF attachments provided with the distribution of this letter.

Employers should inform employees to access the Open Enrollment information online or provide the PDF versions via e-mail attachment or your Departmental Intranet.

For cases where online or e-mail notification is not possible, a paper flier giving instructions on accessing the Open Enrollment publications is provided with this letter and can be copied and distributed as required.

Other open enrollment materials available to you are the FSA Reference Guide and the Declination of Premium Option Plan (POP) form. 

  • A small supply of the 2016 FSA Reference Guide and Enrollment Form will be sent directly to benefits administrators by WageWorks.  Please provide the FSA Reference Guide or Enrollment Form to any employee who requests them.

The FSA Reference Guide and Enrollment Form are also available online at: www.nj.gov/treasury/pensions/taxsave.shtml  

  • This letter includes the Declination of Premium Option Plan (POP) form — which can be copied for use by those few employees who do not wish to participate in the POP and, therefore, pay more in tax.  Please 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 2015, they must complete the form declining the federal tax break they could receive.  Employees should request these forms from benefits administrators and return the Declination of Premium Option Plan (POP) forms to benefits administrators by November 2, 2015.  Benefits administrators must then forward declination forms to Centralized Payroll by November 13, 2015.

As we do every year, the Division of Pensions and Benefits appreciates your cooperation in the Open Enrollment.  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 general questions about Tax$ave 2016, the open enrollment, or the Premium Option Plan, visit the Division of Pensions and Benefits’ Tax$ave Internet site at: www.nj.gov/treasury/pensions/taxsave.shtml call the Division’s Office of Client Services at (609) 292-7524, or send e-mail to: https://www.state.nj.us/treas/pensions/pensionmail.shtml

For more information about the Unreimbursed Medical or Dependent Care Flexible Spending Accounts, contact WageWorks at: www.wageworks.com or call WageWorks Customer Service at 1-855-428-0446.

Enclosures:
Tax$ave 2016 Open Enrollment News
The Premium Option Plan 2016 Flier
Tax$ave — WageWorks Flexible Spending Accounts Flier
Tax$ave — WageWorks Flexible Spending Accounts Enrollment Form

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September 17, 2015

TO: Certifying Officers and Supervisors of Certifying Officers

FROM:

NJ Division of Pensions and Benefits
SUBJECT: Renewal Required for Annual Membership Certification Required under Chapter 52, P.L. 2011

Please be advised that this memorandum will serve as official notice to Certifying Officers and Supervisors of Certifying Officers1 that it is time to renew your Annual Membership Certification as required under the provisions of Chapter 52, P.L. 2011.2

MEMBERSHIP CERTIFICATION AVAILABLE ONLINE IN EPIC

The Certifying Officer and Supervisor of the Certifying Officer are both required to complete the Chapter 52 Annual Membership Certification, which is available as an online application in the Employer Pensions and Benefits Information Connection (EPIC). All certifications must be completed no later than September 30, 2015.

The Certifying Officer and Supervisor of the Certifying Officer should immediately:

  • Log on to EPIC — go to: www.nj.gov/treasury/pensions and click the link “Log on to MBOS or EPIC.” Then log on to myNewJersey and EPIC.
  • On your EPIC Home Page you will see a button for the “Chapter 52 Annual Certification.” Click the button and the first page of the application will show the Chapter 52 training and certification status of the Certifying Officer and the Supervisor of the Certifying Officer. To complete the Annual Membership Certification, click the “Complete Certification” button.

    Note: If Chapter 52 training has not been completed by both individuals, it must be done immediately. The “Complete Certification” button will not be available until the required Chapter 52 training is completed.
  • If you are able to certify that each member of the retirement system is properly enrolled, click “Yes.” You will receive an online confirmation and the process is completed.
  • If you are unable to certify that each member of the retirement system is properly enrolled, click “No” and you will be shown a page with detailed instructions on how to report any improperly enrolled individuals to the Division of Pensions and Benefits — employers should also remove these individuals from the quarterly Report of Contributions. Once any instance of an improperly enrolled worker has been reported with the Division, you will receive a follow-up e-mail from the Division with instructions that you may return to EPIC and complete the Annual Membership Certification.

Immediate action is required. The Certifying Officer and Supervisor of the Certifying Officer must each complete the Annual Membership Certification no later than September 30, 2015. Failure to do so will prevent the Division from accepting any new enrollment applications from the employing location until the certifications are completed.

CERTIFICATION IS REQUIRED ANNUALLY

Under the provisions of Chapter 52, Membership Certifications are due annually each September. Employers will receive notification that memberships are again due for certification in September 20163 and each year thereafter.

IMPORTANCE OF PROPER ENROLLMENT

Improper enrollment of ineligible individuals in the retirement systems results in pension abuse and a loss of public confidence in local and state administrators. Failure to complete the required training and/or Annual Membership Certification may also result in financial hardship for your employees and financial harm or other penalties for you, the employer.

Until Chapter 52 training and the Annual Certification is completed:

  • Your employing location cannot process enrollment applications or transfers until both the Certifying Officer and the Supervisor complete training.
  • Employees with delayed enrollments will have significantly larger back deduction amounts resulting in longer repayment schedules.
  • Your employing location may be subject to a delayed enrollment liability if an employee is not properly enrolled in the pension system in a timely manner.
  • An employer who enrolls, or permits the continued enrollment of, an individual who is ineligible for membership in the retirement system will be subject to prosecution under N.J.S.A. 43:3C-15 — “any person who knowingly makes a false statement, or falsifies or permits to be falsified any record, application, form, or report of a pension fund or retirement system, in an attempt to defraud the fund or system will be guilty of a crime of the fourth degree.”

It is essential that public employers remain up to date with the enrollment eligibility training and certification requirements. The Division of Pensions and Benefits expects that all Certifying Officers and their Supervisors will make every effort to ensure that their location is in full compliance with this law.

ENROLLMENT AND TRANSFER FORM UPDATES

Please also note that the Division has updated its online and paper Enrollment Applications and Report of Transfer forms to reflect the Chapter 52 training and certification requirements.

While it remains a requirement that employers use the online Enrollment Applications available in EPIC whenever possible, in cases where paper Enrollment Applications or Transfer Forms need to be submitted to the Division, employers must use the most recent versions of the printable forms. Older versions of the forms will be rejected and returned for employer compliance.

Current versions of the Enrollment Applications and Transfer Forms can be obtained from the “Forms Index” of the Employers’ Pensions and Benefits Administration Manual (EPBAM) at: www.nj.gov/treasury/pensions/epbam/

ADDITIONAL INFORMATION

If you have questions or require additional information about Chapter 52 or any of the information in this letter, contact the Division of Pensions and Benefits, Employer Education Unit at (609) 292-7524, or send e-mail to: pensions.nj@treas.nj.gov

1“Certifying Officer” is defined in the law as an officer or employee of the State or of an employer other than the State who is responsible for submitting information to and performing the duties relating to matters concerning the retirement system with respect to each of the employees of the employing location, as required by law, the Board of Trustees or Commission, and the Division of Pensions and Benefits. “Supervisor of the Certifying Officer” is designated by the employing location and is required to be the immediate supervisor of the Certifying Officer as defined above.

2Chapter 52, P.L. 2011, (N.J.S.A. 43:3C-15) requires that both the Certifying Officer and the immediate Supervisor of the Certifying Officer receive training in enrollments and annually certify for each member of the retirement system, that the enrolled person is eligible for membership in the retirement system in accordance with the statutes and regulations of the retirement system. Visit: www.nj.gov/treasury/pensions/enrollment-ch52.shtml for more about Chapter 52.

3In the event of a change in either the Certifying Officer or the Supervisor of the Certifying Officer, the new individual must complete both Chapter 52 training in enrollments and complete a new membership certification.

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September 11, 2015

TO: Certifying Officers, Human Resources Perseonnel, County Colleges

FROM:

Danielle Mason, Assistant Plan Administrator, Division of Pensions and Benefits
SUBJECT: Annual Meeting for Colleges and Universities

The Division of Pensions and Benefits will be holding our Annual Meeting for Certifying Officers and Human Resource staff who specifically handle New Jersey Alternate Benefit Program (ABP) and Additional Contributions Tax Sheltered (ACTS) programs. The Meeting will be held on Thursday October 8, 2015 at the Division of Pensions and Benefits, 50 W. State Street, 1st floor Board Room from 10:00am until 2:00pm.

TOPICS OF DISCUSSION

The Division will discuss topics related to Presentation by VOYA planwithease, employer responsibilities, health benefits, adjunct faculty, retirement processing, and long term disability. If you have any specifics questions that you would like addressed during the meeting please email your question(s) in advance so that we will be prepared to share with the group.

DIRECTIONS TO THE DIVISION OF PENSIONS AND BENEFITS

Please visit our website for directions to our building http://www.state.nj.us/treasury/pensions/drctns.shtml.

ADDITIONAL INFORMATION

Please email your questions in advance to the attention of Danielle Mason, danielle.mason@treas.nj.gov. Also, please provide a list of attendees one week prior to the meeting.

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September 11, 2015

TO: Certifying Officers, Human Resources Personnel, State Colleges

FROM:

Danielle Mason, Assistant Plan Administrator, Division of Pensions and Benefits
SUBJECT: Annual Meeting for Colleges and Universities

The Division of Pensions and Benefits will be holding our Annual Meeting for Certifying Officers and Human Resource staff who specifically handle New Jersey Alternate Benefit Program (ABP) and Additional Contributions Tax Sheltered (ACTS) programs. The Meeting will be held on Tuesday, October 6, 2015 at the Division of Pensions and Benefits, 50 W. State Street, 1st floor Board Room from 10:00am until 2:00pm.

TOPICS OF DISCUSSION

The Division will discuss topics related to Presentation by VOYA planwithease, employer responsibilities, health benefits, adjunct faculty, retirement processing, and long term disability. If you have any specifics questions that you would like addressed during the meeting please email your question(s) in advance so that we will be prepared to share with the group.

DIRECTIONS TO THE DIVISION OF PENSIONS AND BENEFITS

Please visit our website for directions to our building http://www.state.nj.us/treasury/pensions/drctns.shtml.

ADDITIONAL INFORMATION

Please email your questions in advance to the attention of Danielle Mason, danielle.mason@treas.nj.gov. Also, please provide a list of attendees one week prior to the meeting.

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September 11, 2015

TO: Local Education Certifying Officers, Human Resource Representatives, and Benefits Administrators

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: SEHBP Open Enrollment for Plan Year 2016

The School Employees’ Health Benefits Program (SEHBP) Open Enrollment period for Local Education employees will begin on October 1, 2015, and ends on November 2, 2015. During the Open Enrollment period employees can make general changes (adding or deleting dependents, changing coverage levels, etc.) or enroll in a different medical or dental plan. All changes to coverage made during this Open Enrollment period will be effective on January 1, 2016.

Completed employer-certified health benefits and/or dental applications must arrive at the Health Benefits Bureau no later than November 13, 2015, to ensure processing for the start of the 2016 plan year.

Note: Employers should submit completed Health Benefits Applications as they are received from employees rather than holding applications for submission at the end of Open Enrollment.

MEDICAL PLANS

Both Aetna and Horizon Blue Cross Blue Shield of New Jersey will offer Local Education employees Preferred Provider Organization (PPO) plans, Health Maintenance Organization (HMO) plans, and High Deductible Health Plans for the 2016 plan year.

The following medical plans are available to Local Education employees:

  • PPO Plans: Aetna Freedom 10; Aetna Freedom 15; Aetna Freedom 1525; Aetna Freedom 2030; AetnaFreedom 2035; NJ DIRECT10; NJ DIRECT15; NJ DIRECT1525; NJ DIRECT2030; NJ DIRECT2035.
  • HMO Plans: Aetna HMO; Aetna HMO 1525; Aetna HMO 2030; Aetna HMO 2035; Horizon HMO; Horizon HMO 1525; Horizon HMO 2030; Horizon HMO 2035.
  • High Deductible Health Plans: Aetna Value HD1500; NJ DIRECT HD1500.

Note: The service areas for the Horizon HMOs are limited to New Jersey, Delaware, and bordering counties of Pennsylvania and New York.

DENTAL PLANS

The following information is for Local Education employers who provide employee dental coverage through the Employee Dental Plans. Dental coverage is offered to all eligible employees through the Employee Dental Plans.

Six different dental plans are offered based on one of two different plan designs — Dental Plan Organizations (DPO) and a Dental Expense Plan (DEP).

  • Five DPOs are available: Aetna DMO; CIGNA DHMO; Healthplex; Horizon Dental Choice; and MetLife. DPOs contract with a network of providers for dental services. When an employee or dependent uses a DPO dentist, diagnostic and preventive services are covered in full. Most other eligible expenses require a small copayment. Members must use a provider that participates with the DPO selected to receive coverage. Be sure to confirm that the dentist or dental facility selected is taking new patients and participates with the Employee Dental Plans, since DPOs also service other organizations.
  • The Dental Expense Plan is a preferred provider organizaion plan that allows members to obtain services from any dentist; however, using an in-network provider will reduce an employee’s costs. After satisfying an annual deductible (no deductible for preventive services), members are reimbursed a percentage of the reasonable and customary charges for eligible services. The employee cost for coverage under a dental plan is 50 percent of the actual dental plan premium. Therefore, the employee cost varies depending on which dental plan an employee chooses; however, the rate for coverage under a DPO remains considerably less expensive than the Dental Expense Plan.

Dental Plan Rates for 2016 were approved by the State Health Benefits Commission and rate charts for dental coverage for the Local Education Group are to be posted on the Division’s website when made available.

NJWELL WELLNESS PROGRAM

NJWELL is open to employees who are enrolled in the SEHBP. Spouses and eligible partners can also participate, as long as they are covered by the SEHBP plan.

Plan Year 2015 will be coming to a close on October 31. In 2015, employees and their covered spouses or partners can receive a gift card worth up to $200 for earning anywhere from 300 to 500 or more points by October 31!

Watch your e-mail for upcoming information about NJWELL in 2016. Information about program will also be posted on the new NJWELL website at: www.nj.gov/njwell

PAYROLL DEDUCTIONS AVAILABLE FOR HDHP PARTICIPANTS

Employees participating in the one of the High Deductible Health Plans (HDHP) are able to have tax deferred contributions from their paychecks to fund their Health Savings Account (HSA). If one of your employees chooses (or is currently enrolled) in one of the HDHP, Aetna or Horizon will contact you to assist in setting up the payroll deductions. A sample of the HSA Contribution Form can be found online at: http://www.nj.gov/treasury/pensions/epbam/exhibits/pdf/ha0914.pdf

SUMMARIES OF BENEFITS AND COVERAGE

Detailed information about the SEHBP’s medical plans is available through new Summaries of Benefits and Coverage which are posted online at: www.nj.gov/treasury/pensions/hb-sbc-home.shtml A direct mailing is being sent to all SEHBP members to announce the availability of the summaries, however, employers are also asked to provide notice of this information to their employees. A sample of the mailer is included with this letter.

PLAN RATES

Plan rates for 2016 were approved by the School Employees’ Health Benefits Commission. Rate charts will be posted online via the Division’s website.

EMPLOYEE CONTRIBUTIONS FOR SEHBP COVERAGE

Pursuant to the Pension and Health Benefit Reform (Chapter 78, P.L. 2011) and with the expiration, renewal, or extension of collective negotiations agreements, employees must pay a percentage of the medical and prescription plan. Most Local Education employees are currently contributing at the four-year phase-in of contribution rates. Employers should advise their employees of the current phased-in contribution level so they can correctly determine the required contributions when considering plan choices. Percentage of premium contribution worksheets and online calculators will be revised for 2016 plan selections and rates. You will be notified when the online calculator is made available. The increase in plan premiums for 2016 will increase the employee contribution for medical and prescription coverage. Employees who are considering a change of medical plan based on cost should review the contribution amounts for the current contribution phase-in level and if applicable, the next phased-in contribution amount increase.

WAIVING SEHBP COVERAGE

Local Education employees are permitted to waive SEHBP medical and prescription coverage if they have other employer-provided or retiree coverage, or other coverage as a dependent. Employers are permitted to offer an incentive to employees who waive SEHBP coverage. Under Chapter 2, P.L. 2010, the incentive amount for waivers is limited to 25 percent of the amount saved by the employer or $5,000, whichever is less. In addition, because multiple coverage under the SHBP/SEHBP is prohibited, waiver incentives are only payable if the other coverage is through a non-SHBP/SEHBP plan. To waive coverage a Waiver Form and a Health Benefit Application must be completed and submitted during the Open Enrollment. To waive coverage effective January 1, 2016, employees should indicate “Open Enrollment” on the waiver form; otherwise, the waiver will be effective before January 1st.

PLAN MARKETING CONTACTS

Included with this letter you will find a listing of employer marketing contacts for the medical and dental plans. Use these contacts to obtain plan specific information and literature for your employees. These telephone numbers are not for member services. Please forward the information to your Human Resources staff, Benefits Administrators, or any other staff members responsible for the communication and administration of health benefits for your employees. Please do not give these telephone numbers to your employees. (Phone numbers and Web address contacts for employees are provided in the upcoming Health Capsule newsletter and on the Division of Pensions and Benefits Website.)

HEALTH BENEFITS PROGRAM APPLICATIONS

The Health Benefits Program Application — SEHBP Local Education Active Employee Group is available for download online on the Division’s website. Employers should note that a separate application and contribution form are required for enrollment into any of the High Deductible Health Plans (provide the HSA Contribution Form for any HDHP enrollments). Please be certain that your employees are aware of, and have access to these applications. Completed employer-certified medical and/or dental applications (if applicable) must arrive at the Health Benefits Bureau no later than November 13, 2015, to ensure processing for the start of the 2016 plan year.

DISTRIBUTION OF OPEN ENROLLMENT MATERIALS

Your assistance in forwarding the communications and materials is very important and vital to making the Open Enrollment period a beneficial experience for your employees. Please watch for the following e-mails and forward them to your employees:

  • “Find the Plan that Fits” Reminders — The Division will be preparing Open Enrollment reminders and videos to be distributed to all employees to take action and to closely review all of their options during Open Enrollment in order to find the plan that fits their needs and/or the needs of their family.
  • Health Capsule Newsletter — The Health Capsule newsletter, which details plan changes and other Open Enrollment news. Links to applications, comparison charts, and rates can also be found in this year’s Health Capsule.

Online Materials — As of this mailing, Open Enrollment informational materials are being prepared for posting to our website prior to the October 1st Open Enrollment starting date. When these items become available on our website for Open Enrollment you will be notified immediately. Items include the Summaries of Benefits and Coverage (discussed earlier in this letter) and rate information for plan year 2016.

If you are not responsible for the communication and administration of health benefits for your employees, please forward this letter and all future Open Enrollment communications to your Human Resources staff, Benefits Administrators, or any other staff members who will be distributing the Open Enrollment materials to your employees.

SOCIAL MEDIA

We encourage you and your employees to stay connected to the Division throughout Open Enrollment via our social media accounts listed below:

www.facebook.com/NJDPB
https://www.facebook.com/njwellnessprogram
www.twitter.com/NJDPB1

ADDITIONAL INFORMATION

If you have any questions about the SEHBP Open Enrollment or the information in this letter, please contact our Office of Client Services at (609) 292-7524 or send an e-mail to: pensions.nj@treas.nj.gov

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

Enclosure

Summaries of Benefits and Coverage sample

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September 11, 2015

TO: Local Government Certifying Officers, Human Resource Representatives, and benefits Administrators

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: SHBP Open Enrollment for Plan Year 2016

The State Health Benefits Program (SHBP) Open Enrollment period for Local Government employees will begin on October 1, 2015, and end on November 2, 2015.

Open Enrollment allows employees to make general changes (adding or deleting dependents, changing coverage levels, etc.) or enroll in a different medical or dental plan. All changes to coverage made during this Open Enrollment period will be effective on January 1, 2016.

Completed employer-certified medical and/or dental applications must arrive at the Health Benefits Bureau no later than November 13, 2015, to ensure processing for the start of the 2016 plan year.

Note: Employers should submit completed Health Benefits Applications as they are received from employees rather than holding applications for submission at the end of Open Enrollment.

MEDICAL PLANS

Changes for Plan Year 2016

For employees covered under the SHBP, the selection of medical plans will change for Plan Year 2016. Both Aetna and Horizon Blue Cross Blue Shield of New Jersey (Horizon) will offer a new tiered network plan design. These tiered network plans will replace the HMO1525, HMO2030 & HMO2035 products and will only be offered to active employees only. Participants in those plans will be automatically transferred to the new tiered network plan or they can choose another plan by November 2. Aetna HMO1525/2030/2035 members will be placed in the Aetna tiered network plan called the Aetna Liberty Plan and Horizon HMO1525/2030/2035 members will be placed in Horizon’s OMNIA Health Plan tiered network plan.

The following describes the tiered network plan design:

  • The Aetna Liberty Plan and Horizon’s OMNIA Health Plan will give members the flexibility to visit high-quality practitioners in the carrier’s managed care network, significant premium share reductions and no referrals are required. There will be lower member cost sharing, with copays as low as $5.00 for an office visit, when utilizing Tier 1 providers. Tier 1 refers to specific doctors, hospitals and other health care professionals who offer high-quality, cost-effective care. Tiered Network plan members also have the flexibility to see any Tier 2 provider included in the managed care network, but with slightly higher cost sharing. There is no out-of-network coverage with the Tiered Plans.

Aetna Liberty Plan — Members can use DocFind™ to search for participating Tier 1 and Tier 2 providers at http://www.aetnastatenj.com/ starting in October.

Horizon’s OMNIA Health Plan — Members will be able to identify Tier 1 and Tier 2 providers on the Horizon online Doctor & Hospital finder at http://shbp.horizonblue.com/ in early September.

Other changes taking effect with Plan Year 2016 include the following:

  • Payment for Out-Of-Network Chiropractic and Acupuncture visits will be limited to $35 for chiropractic and $60 for acupuncture, or 75% of the in-network cost per visit, whichever is less. That’s the full amount the provider will receive from the carriers for the visit, not just member co-insurance. This means that, if the chiropractor charges more than $35 for an office visit, the member will have to pay the difference out of his/her pocket. Aetna and Horizon both have extensive provider networks, so members should consider switching to an in-network practitioner.
  • Emergency room co-pays will increase by $25 where the co-pay is currently less than $100. For example, in NJ DIRECT10 and Aetna Freedom 10, the copays will increase to $50. This does not apply to dependents under age 19 or members referred to the ER by a physician.

2016 Plan Designs

The same Preferred Provider Organization (PPO) plans, two Health Maintenance Organization (HMO) plans, two new Tiered Network Plans, and the same High Deductible Health Plans will be offered for Plan Year 2016.

The medical plans available to employees are:

  • New! Tiered Network Plans: Aetna Liberty Plan; Horizon’s OMNIA Health Plan
  • PPO Plans: Aetna Freedom 10; Aetna Freedom 15; Aetna Freedom 1525; Aetna Freedom 2030; Aetna Freedom 2035; NJ DIRECT10; NJ DIRECT15; NJ DIRECT1525; NJ DIRECT2030; NJ DIRECT2035.
  • HMO Plans: Aetna HMO; Horizon HMO;
  • High Deductible Health Plans: Aetna Value HD1500; Aetna Value HD4000; NJ DIRECT HD1500; NJ DIRECT HD4000.

Note: The service areas for Horizon HMO is limited to New Jersey, Delaware, and bordering counties of Pennsylvania and New York.

DENTAL PLANS

There are no dental plan changes for Plan Year 2016. Dental coverage is offered to all eligible employees through the Employee Dental Plans. Six different dental plans are offered based on one of two different plan designs — Dental Plan Organizations (DPO) and a Dental Expense Plan (DEP).

  • Five DPOs are available: Aetna DMO; CIGNA DHMO; Healthplex; Horizon Dental Choice; and MetLife.

    DPOs contract with a network of providers for dental services. When an employee or dependent uses a DPO dentist, diagnostic and preventive services are covered in full. Most other eligible expenses require a small copayment. Members must use a provider that participates with the DPO selected to receive coverage. Be sure to confirm that the dentist or dental facility selected is taking new patients and participates with the SHBP Employee Dental Plans, since DPOs also service other organizations.
  • The Dental Expense Plan is a preferred provider organization plan that allows members to obtain services from any dentist; however, using an in-network provider will reduce an employee’s costs. After satisfying an annual deductible (no deductible for preventive services), members are reimbursed a percentage of the reasonable and customary charges for eligible services.

    The employee cost for coverage under a dental plan is 50 percent of the actual dental plan premium. Therefore, the employee cost varies depending on which dental plan an employee chooses; however, the rate for coverage under a DPO remains considerably less expensive than the Dental Expense Plan.

Dental Plan Rates for 2016 were approved by the State Health Benefits Commission and rate charts for dental coverage will be posted online for the Open Enrollment via the Division’s website.

NJWELL WELLNESS PROGRAM

NJWELL is open to employees who are enrolled in the SHBP. Spouses and eligible partners can also participate, as long as they are covered by the SHBP plan.

The Wellness Plan Year 2015 will be coming to a close on October 31. In 2015, employees and their covered spouses or partners can receive a gift card worth up to $200 for earning anywhere from 300 to 500 or more points by October 31!

Watch your e-mail for upcoming information about NJWELL in 2016. Information about the program will also be posted on the new NJWELL website at: www.nj.gov/njwell

PAYROLL DEDUCTIONS AVAILABLE FOR HDHP PARTICIPANTS

Employees participating in the one of the High Deductible Health Plans (HDHP) are able to have tax deferred contributions from their paychecks to fund their Health Savings Account (HSA). If one of your employees chooses (or is currently enrolled) in one of the HDHP, Aetna or Horizon will contact you to assist in setting up the payroll deductions. A sample of the HSA Contribution Form can be found online at: http://www.nj.gov/treasury/pensions/epbam/exhibits/pdf/ha0914.pdf

SUMMARIES OF BENEFITS AND COVERAGE

Detailed information about the SHBP’s medical plans is available through the Summaries of Benefits and Coverage will be posted online at: www.nj.gov/treasury/pensions/hb-sbc-home.shtml

When this information becomes available, a direct mailing will be sent to all SHBP members. In addition, employers will be notified of the availability of the SBCs via an EPIC email and will be asked to forward this information to their employees.

PLAN RATES

Plan rates for 2016 were approved by the State Health Benefits Commission. Rate charts for the will be posted online on the Division’s website. An e-mail will be sent to employers when this information becomes available and you will be asked to share this with your employees.

EMPLOYEE CONTRIBUTIONS FOR SHBP COVERAGE

Pursuant to the Pension and Health Benefit Reform (Chapter 78, P.L. 2011) and with the expiration, renewal, or extension of collective negotiations agreements, employees must pay a percentage of the medical and prescription plan. Most Local employees are currently contributing at the four-year phase-in of contribution rates. Employers should advise their employees of the current phased-in contribution level so they can correctly determine the required contributions when considering plan choices. Percentage of premium contribution worksheets and online calculators will be revised for 2016 plan selections and rates. You will be notified when the online calculator is made available. The increase in plan premiums for 2016 will increase the employee contribution for medical and prescription coverage. Employees who are considering a change of medical plan based on cost should review the contribution amounts for the current contribution phase-in level and if applicable, the next phased-in contribution amount increase.

WAIVING SHBP COVERAGE

Local government employees are permitted to waive SHBP medical and prescription coverage if they have other employer-provided or retiree coverage, or other coverage as a dependent. Employers are permitted to offer an incentive to employees who waive SHBP coverage. Under Chapter 2, P.L. 2010, the incentive amount for waivers is limited to 25 percent of the amount saved by the employer or $5,000, whichever is less. In addition, because multiple coverage under the SHBP/SEHBP is prohibited, waiver incentives are only payable if the other coverage is through a non-SHBP/SEHBP plan. To waive coverage a SHBP Waiver Form for Local Employees and a Health Benefit Application must be completed and submitted during Open Enrollment. To waive coverage effective January 1, 2015, employees should indicate “Open Enrollment” on the waiver form; otherwise, the waiver will be effective before January 1st.

PLAN MARKETING CONTACTS

Included with this letter you will find a listing of employer marketing contacts for the medical and dental plans. Use these contacts to obtain plan specific information and literature for your employees. These telephone numbers are not for member services. Please forward the information to your Human Resources staff, Benefits Administrators, or any other staff members responsible for the communication and administration of health benefits for your employees. Please do not give these telephone numbers to your employees. (Phone numbers and Web address contacts for employees are provided in the upcoming Health Capsule newsletter and on the Division of Pensions and Benefits Website.)

REVISED HEALTH BENEFITS PROGRAM APPLICATIONS

The Health Benefits Program Application — SHBP Local Government Active Employee Group form will be revised due to recent plan changes. Employers should note that a separate application and contribution form are required for enrollment into any of the High Deductible Health Plans (provide the HSA Contribution Form for any HDHP enrollments). Please be certain that your employees are aware of, and have access to these applications. Completed employer-certified medical and/or dental applications (if applicable) must arrive at the Health Benefits Bureau no later than November 13, 2015, to ensure processing for the start of the 2016 plan year.

DISTRIBUTION OF OPEN ENROLLMENT MATERIALS

Your assistance in forwarding the communications and materials is very important and vital to making the Open Enrollment period a beneficial experience for your employees. Please watch for the following e-mails and forward them to your employees:

  • “Find the Plan that Fits” Reminders — The Division will be preparing Open Enrollment reminders and videos to be distributed to all employees to take action and to closely review all of their options during Open Enrollment in order to find the plan that fits their needs and/or the needs of their family.
  • Health Capsule Newsletter — The Health Capsule newsletter, which details plan changes and other Open Enrollment news. Links to applications, comparison charts, and rates can also be found in this year’s Health Capsule.

Online Materials — As of this mailing, Open Enrollment informational materials are being prepared for posting to our website prior to the October 1st Open Enrollment starting date. When these items become available on our website for Open Enrollment you will be notified immediately. Items include the Summaries of Benefits and Coverage (discussed earlier in this letter) and rate information for plan year 2016.

If you are not responsible for the communication and administration of health benefits for your employees, please forward this letter and all future Open Enrollment communications to your Human Resources staff, Benefits Administrators, or any other staff members who will be distributing the Open Enrollment materials to your employees.

SOCIAL MEDIA

We encourage you and your employees to stay connected to the Division throughout Open Enrollment via our social media accounts listed below:

www.facebook.com/NJDPB
https://www.facebook.com/njwellnessprogram
www.twitter.com/NJDPB1

ADDITIONAL INFORMATION

If you have any questions about the SHBP Open Enrollment or the information in this letter, please contact our Office of Client Services at (609) 292-7524 or send an e-mail to: pensions.nj@treas.nj.gov

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

Enclosure

Summaries of Benefits and Coverage sample

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September 11, 2015

TO: State Biweekly and Monthly Certifying Officers, Human Resource Directors, and Benefits Administrators

FROM:

New Jersey Division of Pensions and Benefits
SUBJECT: SHBP Open Enrollment for Plan Year 2016

The State Health Benefits Program (SHBP) Open Enrollment period for employees will begin on October 1, 2015, and ends on November 2, 2015.

Open Enrollment allows employees to make general changes (adding or deleting dependents, changing coverage levels, etc.) or enroll in a different medical or dental plan. All changes to coverage made during this Open Enrollment period will be effective December 26, 2015 for State biweekly employees and January 1, 2016 for all other employees.

Completed employer-certified medical and/or dental applications must arrive at the Health Benefits Bureau no later than November 13, 2015, to ensure processing for the start of the 2016 plan year.

Note: Employers should submit completed Health Benefits Applications as they are received from employees rather than holding applications for submission at the end of Open Enrollment.

MEDICAL PLANS

Changes for Plan Year 2016

For employees covered under the SHBP, the selection of medical plans will change for Plan Year 2016. Both Aetna and Horizon Blue Cross Blue Shield of New Jersey (Horizon) will offer a new tiered network plan design. These tiered network plans will replace the HMO1525, HMO2030 & HMO2035 products and will only be offered to active employees only. Participants in those plans will be automatically transferred to the new tiered network plan or they can choose another plan by November 2. Aetna HMO1525/2030/2035 members will be placed in the Aetna tiered network plan called the Aetna Liberty Plan and Horizon HMO1525/2030/2035 members will be placed in the Horizon OMNIA Health Plan tiered network plan.

The following describes the tiered network plan design:

  • The Aetna Liberty Plan and Horizon’s OMNIA Health Plan will give members the flexibility to visit high-quality practitioners in the carrier’s managed care network, significant premium share reductions and no referrals are required. There will be lower member cost sharing and copays as low as $5.00 for an office visit, when utilizing Tier 1 providers. Tier 1 refers to specific doctors, hospitals and other health care professionals who offer high-quality, cost-effective care. Tiered Network plan members also have the flexibility to see any Tier 2 provider included in the managed care network, but with slightly higher cost sharing. There is no out-of-network coverage with the Tiered Plans.

Aetna Liberty Plan — Members can use DocFind™ to search for participating Tier 1 and Tier 2 providers at http://www.aetnastatenj.com/ starting in October.

Horizon’s OMNIA Health Plan — Members will be able to identify Tier 1 and Tier 2 providers on the Horizon online Doctor & Hospital finder at http://shbp.horizonblue.com/ in early September.

Other changes taking effect with Plan Year 2016 include the following:

  • Payment for Out-Of-Network Chiropractic and Acupuncture visits will be limited to $35 for chiropractic and $60 for acupuncture, or 75% of the in-network cost per visit, whichever is less. That’s the full amount the provider will receive from the carriers for the visit, not just member co-insurance. This means that, if the chiropractor charges more than $35 for an office visit, the member will have to pay the difference out of his/her pocket. Aetna and Horizon both have extensive provider networks, so members should consider switching to an in-network practitioner.
  • Emergency room co-pays will increase by $25 where the co-pay is currently less than $100. For example, in NJ DIRECT10 and Freedom10, the copays will increase to $50. This does not apply to dependents under age 19 or members referred to the ER by a physician.

2016 Plan Designs

The same Preferred Provider Organization (PPO) plans, two Health Maintenance Organization (HMO) plans, two new Tiered Network Plans, and the same High Deductible Health Plans will be offered for Plan Year 2016.

The medical plans available to employees are:

  • New! Tiered Network Plans: Aetna Liberty Plan; Horizon’s OMNIA Health Plan
  • PPO Plans: Aetna Freedom15; Aetna Freedom1525; Aetna Freedom2030; Aetna Freedom2035; NJ DIRECT15; NJ DIRECT1525; NJ DIRECT2030; NJ DIRECT2035.
  • HMO Plans: Aetna HMO; Horizon HMO;
  • High Deductible Health Plans: Aetna Value HD1500; Aetna Value HD4000; NJ DIRECT HD1500; NJ DIRECT HD4000.

Note: The service area for Horizon HMO is limited to New Jersey, Delaware, and bordering counties of Pennsylvania and New York.

DENTAL PLANS

There are no dental plan changes for Plan Year 2016. Dental coverage is offered to all eligible employees through the Employee Dental Plans. Six different dental plans are offered based on one of two different plan designs — Dental Plan Organizations (DPO) and a Dental Expense Plan (DEP).

  • Five DPOs are available: Aetna DMO; CIGNA DHMO; Healthplex; Horizon Dental Choice; and MetLife.

    DPOs contract with a network of providers for dental services. When an employee or dependent uses a DPO dentist, diagnostic and preventive services are covered in full. Most other eligible expenses require a small copayment. Members must use a provider that participates with the DPO selected to receive coverage. Be sure to confirm that the dentist or dental facility selected is taking new patients and participates with the SHBP Employee Dental Plans, since DPOs also service other organizations.
  • The Dental Expense Plan is a preferred provider organization plan that allows members to obtain services from any dentist; however, using an in-network provider will reduce an employee’s costs. After satisfying an annual deductible (no deductible for preventive services), members are reimbursed a percentage of the reasonable and customary charges for eligible services.

    The employee cost for coverage under a dental plan is 50 percent of the actual dental plan premium. Therefore, the employee cost varies depending on which dental plan an employee chooses; however, the rate for coverage under a DPO remains considerably less expensive than the Dental Expense Plan.

Dental Plan Rates for 2016 were approved by the State Health Benefits Commission and rate charts for dental coverage will be posted online for the Open Enrollment via the Division’s website.

NJWELL WELLNESS PROGRAM

NJWELL is open to employees who are enrolled in the SHBP. Spouses and eligible partners can also participate, as long as they are covered by the SHBP plan.

The Wellness Plan Year 2015 will be coming to a close on October 31. In 2015, employees and their covered spouses or partners can receive a gift card worth up to $200 for earning anywhere from 300 to 500 or more points by October 31!

Watch your e-mail for upcoming information about NJWELL in 2016. Information about the program will also be posted on the new NJWELL website at: www.nj.gov/njwell

PAYROLL DEDUCTIONS AVAILABLE FOR HDHP PARTICIPANTS

Employees participating in the one of the High Deductible Health Plans (HDHP) are able to have tax deferred contributions from their paychecks to fund their Health Savings Account (HSA). If one of your employees chooses (or is currently enrolled) in one of the HDHP, Aetna or Horizon will contact you to assist in setting up the payroll deductions.

SUMMARIES OF BENEFITS AND COVERAGE

Detailed information about the SHBP’s medical plans is available through the Summaries of Benefits and Coverage will be posted online at: www.nj.gov/treasury/pensions/hb-sbc-home.shtml

When this information becomes available, a direct mailing will be sent to all SHBP members. In addition, employers will be notified of the availability of the SBCs via an EPIC email and will be asked to forward this information to their employees.

PLAN RATES

Plan rates for 2016 were approved by the State Health Benefits Commission. Rate charts for the will be posted online on the Division’s website.

An e-mail will be sent to employers when this information becomes available and you will be asked to share this with your employees.

EMPLOYEE CONTRIBUTIONS FOR SHBP COVERAGE

Pursuant to the Pension and Health Benefit Reform (Chapter 78, P.L. 2011), employees must pay a percentage of the medical and prescription plan premiums.

Percentage of premium contribution worksheets and online calculators will be revised for 2016 rates, and will be available on the Division’s website.

An e-mail will be sent to employers when this information becomes available and you will be asked to notify your employees.

WAIVING SHBP COVERAGE

State employees are permitted to waive SHBP medical and prescription coverage — and avoid the required employee contribution — provided that they have other health care coverage. To waive coverage a SHBP State Waiver form and a Health Benefit Application must be completed during Open Enrollment. To waive coverage effective December 26, 2015, employees should indicate “Open Enrollment” on the waiver form; otherwise, the waiver will be effective before the new plan year.

PLAN MARKETING CONTACTS

Included with this letter you will find a listing of employer marketing contacts for the medical and dental plans. Use these contacts to obtain plan specific information and literature for your employees. These telephone numbers are not for member services. Please forward the information to your Human Resources staff, Benefits Administrators, or any other staff members responsible for the communication and administration of health benefits for your employees. Please do not give these telephone numbers to your employees. (Phone numbers and Web address contacts for employees are provided in the upcoming Health Capsule newsletter and on the Division of Pensions and Benefits Website.)

REVISED HEALTH BENEFITS PROGRAM APPLICATIONS

The Health Benefits Program Application — SHBP State Active Employee Group form will be revised due to recent plan changes and made available on the website prior to Open Enrollment. Employers should note that a separate application and contribution form are required for enrollment into any of the High Deductible Health Plans (provide the HSA Contribution Form to Centralized Payroll for any HDHP enrollments). Please be certain that your employees are aware of, and have access to these applications. Completed employer-certified medical and/or dental applications must arrive at the Health Benefits Bureau no later than November 13, 2015, to ensure processing for the start of the 2016 plan year.

DISTRIBUTION OF OPEN ENROLLMENT MATERIALS

Your assistance in forwarding the communications and materials is very important and vital to making the Open Enrollment period a beneficial experience for your employees. Please watch for the following e-mails and forward them to your employees:

  • “Find the Plan that Fits” Reminders — The Division will be preparing Open Enrollment reminders and videos to be distributed to all employees to take action and to closely review all of their options during Open Enrollment in order to find the plan that fits their needs and/or the needs of their family.
  • Health Capsule Newsletter — The Health Capsule newsletter, which details plan changes and other Open Enrollment news. Links to applications, comparison charts, and rates can also be found in this year’s Health Capsule.

Online Materials — As of this mailing, Open Enrollment informational materials are being prepared for posting to our website prior to the October 1st Open Enrollment starting date. When these items become available on our website for Open Enrollment you will be notified immediately. Items include the Summaries of Benefits and Coverage (discussed earlier in this letter) and rate information for plan year 2016.

If you are not responsible for the communication and administration of health benefits for your employees, please forward this letter and all future Open Enrollment communications to your Human Resources staff, Benefits Administrators, or any other staff members who will be distributing the Open Enrollment materials to your employees.

SOCIAL MEDIA

We encourage you and your employees to stay connected to the Division throughout Open Enrollment via our social media accounts listed below:

www.facebook.com/NJDPB
https://www.facebook.com/njwellnessprogram
www.twitter.com/NJDPB1

ADDITIONAL INFORMATION

If you have any questions about the SHBP Open Enrollment or the information in this letter, please contact our Office of Client Services at (609) 292-7524 or send an e-mail to: pensions.nj@treas.nj.gov

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

Enclosure

Summaries of Benefits and Coverage sample

CO Letter in Printable Format Adobe PDF (50K)

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September 10, 2015

TO: Certifying Officers of the Public Employees' Retirement System (PERS)

FROM:

Hank Schwedes, Board Secretary
Public Employees' Retirement System (PERS)
SUBJECT: PERS Notice of Election

This certifying officer letter and the attached notice for the 2016 Public Employees' Retirement System (PERS) elections require your cooperation and response.

We are seeking your assistance in servicing an election for one “State” Representative position, and one “Municipal” Representative position to the PERS Board of Trustees. The State and Municipal representatives will be elected for three-year terms as of July 1, 2016. Candidates for both positions must qualify by nomination.

We are requesting that you distribute the attached election notice electronically or as paper to each PERS member employed at your location, as the information will explain the pre-election procedures. It is most important that each individual active PERS member receives this notice. If you are the certifying officer for multiple locations, you will only receive one certifying officer letter and will be required to distribute the attached election notice to active PERS members at all locations. Your attention to this distribution is required as regulated by N.J.A.C. 17:2-1.4.

If you are not able to accommodate electronic distribution, please make copies of the notice and provide to all active PERS employees. In addition, if you maintain a website for your employees, you may post the notice there and in any other appropriate public place at your location.

It is very important that you confirm distribution of this notice. To confirm distribution of the notice to your active PERS employees, please send an e-mail to: NJBOT.ELECT@treas.nj.gov

Thank you for your prompt assistance and distribution of this notice.

Attachment: Election Notice

CO Letter in Printable Format Adobe PDF (50K)

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September 10, 2015

TO: Certifying Officers of the Police and Firemen's Retirement System (PFRS)

FROM:

Hank Schwedes, Board Secretary
Police and Firemen's Retirement System (PFRS)
SUBJECT: PFRS Notice of Election

This certifying officer letter and the attached notice for the 2015 Police and Firemen’s Retirement System (PFRS) “firefighter” election is being transmitted to you electronically and will require your electronic response.

We are seeking your assistance in servicing an election for one “Firefighting” Representative position, to the PFRS Board of Trustees. A Fire representative will be elected for a four-year term as of July 1, 2016. Candidates for all positions must now qualify by electronic nomination.

We are requesting that you distribute the attached election notice electronically to each PFRS firefighting member employed at your location, as the information will explain the pre-election procedures. It is most important that each individual active PFRS Fire member receives this notice. If you are the certifying officer for multiple locations, you will only receive one certifying officer letter and will be required to distribute the attached election notice to active PFRS Fire members at all locations. Your attention to this distribution is required as regulated by N.J.A.C. 17:4-1.4.

We ask that you distribute this notice by the preferred method of distribution, which is electronically by no later than September 25, 2015. If you are not able to accommodate electronic distribution, please make copies of the notice and provide to all active PFRS Fire employees. In addition, if you maintain a website for your employees, you may post the notice there and in any other appropriate public place at your location.

It is very important that you confirm distribution of this notice. To confirm distribution of the notice to your active PFRS employees, please send an email to NJBOT.ELECT@treas.nj.gov.

Thank you for your prompt assistance in the timely response and distribution of this notice.

Attachment: Election Notice

CO Letter in Printable Format Adobe PDF (60K)

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July 7, 2015

TO: Certifying Officers, Alternate Benefit Program

FROM:

Danielle Mason, Assistant ABP Manager
New Jersey Division of Pensions and Benefits
DB & DC Plans Reporting Bureau - Alternate Benefit Program

SUBJECT: Alternate Benefit Program (ABP) Annual Report of Covered Lives - 2015

 
The Division of Pensions and Benefits (DPB) is requesting the public Colleges and Universities to provide updated salary information for active members of the New Jersey Alternate Benefit Program (ABP). 

Access to the ABP EPIC application is accessible to you under the DPB’s EPIC program.  This program is the preferred method of providing annual salaries and employment status updates for the ABP members enrolled at your institution as of June 30, 2015. The employee’s annual salary information can be updated to the application daily. All information should be completed no later than August 7, 2015. As the security officer for the EPIC application, you may request authorization for selected staff so that they may update this information, in addition to yourself.

The DPB will stand firm on their policy that prevents any future employer reimbursements when required information is not submitted in a timely manner.  Failure to provide updated information by August 7, 2015 will result in the withholding of all reimbursement of employer ABP matching contributions until your institution complies with the reporting requirement.

Detailed instructions for using the EPIC online application are attached.  If you are not able to provide the information via the EPIC Web-based program, a rewritable CD or DVD is the next available method; however, a Microsoft Excel spreadsheet is acceptable and can be emailed to: danielle.mason@treas.nj.gov  Please include the following: ABP number (7 digits), member’s last name & first name, contractual base salary, and vesting status.

Should you have any questions, I may be reached at (609) 341-2935. Thank you for your anticipated cooperation.

CO Letter in Printable Format Adobe PDF (49K)

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June 10, 2015

TO: Certifying Officers, State and County Colleges and Universities
FROM:

Nancy Ronaghan, Defined Contribution Plans Manager
New Jersey Division of Pensions and Benefits

SUBJECT: Fiscal 2015 Alternate Benefit Program Default Designated Service Provider

The Division has named Prudential Retirement as the Alternate Benefit Program (ABP) default provider for the upcoming fiscal year — July 1, 2015 thru June 30, 2016.

The Division of Pensions and Benefits strongly encourages ABP members to participate in their retirement planning; however, enrollees who do not choose a designated service provider for their program contributions within 45 days of participation are enrolled with the approved default designated service provider.

The default designated service provider is authorized to accept employer and employee mandatory contributions, and to invest the contributions in their approved default option. Contributions continue to be sent to the default provider and invested in the approved default option, until the ABP member designates a different provider or completes an application with the default designated service provider. The employer is then notified of the change.

Members in both active and delayed vesting status enrolled through the default process are allowed to choose an alternate designated service provider and transfer the contributions deposited to that alternate provider.

Please be aware that ACTS 403(b) monies cannot be defaulted.  In fact, Prudential does not offer the ACTS 403(b) program.  Therefore, any participant who is looking to enroll in the 403(b) program must first elect a designated service provider.  In addition, the participant must fill out the salary reduction agreement before any contributions are taken.  If contributions are taken before a designated service provider is chosen, those contributions will be returned to the employer.  You may view the State of New Jersey’s Centralized Payroll salary reduction form for reference at this link www.state.nj.us/treasury/pensions/epbam/exhibits/pdf/fx0002.pdf
 
The Division of Pensions and Benefits considers the concerns of members, Human
Resource managers and the designated service providers for the ABP and periodically selects a designated service provider to serve as the default provider. The Division of Pensions and Benefits will provide notification of any change to the default provider each fiscal year.

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June 2, 2015

TO: Certifying Officers of the Public Employees' Retirement System and the Teachers' Pension and Annuity Fund
FROM: New Jersey Division of Pensions and Benefits
SUBJECT: Pension Contribution Rate Change for the Judicial Retirement System (JRS)

Pursuant to Article VI, Section VI, Paragraph 6 of the New Jersey Constitution — as authorized under Chapter 78, P.L. 2011, Pension and Health Benefit Reform — employee pension and health benefit contribution rates for members of the JRS will increase as of State Biweekly Pay Period #14 of 2015 (the July 2, 2015 paycheck).

Please notify your employees who are JRS members of the upcoming contribution rate changes.

PENSION CONTRIBUTION RATES

The increase in JRS pension contributions is calculated in one of two different ways depending upon when an individual was enrolled into the JRS.

  • For JRS members enrolled into the retirement system on or after January 1, 1996, the pension contribution rate will increase to 9.4% of all compensation.
  • For JRS members enrolled into the retirement system before January 1, 1996, the pension contribution is calculated using one rate for the compensation of the member’s current position as of January 18, 1982, and a separate rate for the balance of the member’s compensation in excess of the January 18, 1982, compensation. The employee contribution rates for this group will increase to 6.4% for the compensation as of January 18, 1982, and to 9.4% for any compensation exceeding the January 18, 1982, compensation.

The change in the JRS contribution rate will also increase the minimum repayment amount for new pension loans or the cost for a purchase of service credit if certified after the increased contribution rate becomes effective.

FUTURE PENSION INCREASES

Chapter 78 calls for JRS employee pension contribution rates to increase by 1.28% a year over 7 years until a total additional pension contribution rate of 9% is reached as of July 2017 — making the full contribution rate 12% for JRS members enrolled into the retirement system on or after January 1, 1996. 

EMPLOYEE HEALTH BENEFIT CONTRIBUTIONS

Chapter 78, P.L. 2011, also requires that employees enrolled in the State Health Benefits Program (SHBP) pay an increased portion of the cost of health benefits coverage based on a specified percentage of the medical and prescription drug plan premiums. Contribution increases were phased in over four years. The final phase of the health benefit contribution changes was in July 2014. Therefore, employees should now be paying the full amount of the required percentage of premiums for medical and prescription drug coverage.
Rate charts, percentage worksheets, and Percentage of Premium Calculators are available on the SHBP home page at:
www.state.nj.us/treasury/pensions/health-benefits.shtml

ADDITIONAL INFORMATION

If you have questions regarding the information provided in this letter, contact the Division’s Employer Education Unit at (609) 292-7524, or e-mail the Division at: pensions.nj@treas.nj.gov

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June 2, 2015

TO: Certifying Officers of the Public Employees' Retirement System and the Teachers' Pension and Annuity Fund
FROM: New Jersey Division of Pensions and Benefits
SUBJECT: Pension Contribution Rate Change for the Public Employees' Retirement System (PERS)
and the Teachers' Pension and Annuity Fund (TPAF)


Pursuant to Chapter 78, P.L. 2011, Pension and Health Benefit Reform, PERS and TPAF employee pension contribution rates will increase from 6.92% to 7.06% of salary with the first paycheck on or after July 1, 2015. 

  • State employees paid through the Centralized Payroll Unit will receive check messages as notification of the contribution change which will begin as of the July 2, 2015 paycheck.
  • For all other employees, the increase to 7.06% is to be effective with the first paycheck to be paid on or after July 1, 2015 (which is reported to the Division of Pensions and Benefits as compensation during the 3rd calendar quarter of 2015).

The change in the employee’s contribution rate will also increase the minimum repayment amount for new pension loans or the cost for a purchase of service credit if certified after the increased contribution rate becomes effective.
Note: There is no additional increase for PERS Prosecutors Part members whose contribution rate increased to 10% in October 2011.

NOTIFICATIONS OF EMPLOYEES

State biweekly employees paid through the State Centralized Payroll Unit will receive check messages with Pay Periods #13 (June 19, 2015) and #14 (July 2, 2015) to announce the PERS/TPAF contribution change.  Copies of the check messages are attached for reference. State biweekly employers are encouraged to provide their employees with additional reminders of the coming rate change.
State monthly, local government, and local education employers are asked to provide payroll messages or other notifications to inform their employees of the coming rate change.

FUTURE INCREASES

July 2015 marks the fifth rate increase under the provisions of Chapter 78, which calls for PERS and TPAF employee pension contribution rates to increase over 7 years until the total pension contribution rate is 7.5% of salary as of July 2018. 

ADDITIONAL INFORMATION

If you have questions regarding the information provided in this letter, contact the Division’s Employer Education Unit at (609) 292-7524, or e-mail the Division at: pensions.nj@treas.nj.gov

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March 31, 2015

TO: Certifying Officers, State Colleges and Universities
FROM: New Jersey Division of Pensions and Benefits
SUBJECT: Affordable Care Act (ACA), Employer Shared Responsibility Provisions and Reporting Requirements

Employer Shared Responsibility Provisions in the ACA

According to the Employer Shared Responsibility Provisions in the Affordable Care Act (ACA), effective January 1, 2015, applicable large employers (defined as those with at least 50 “full-time” or “full-time equivalent” employees) may face a penalty if they do not offer their full-time employees the opportunity to enroll in health coverage that meets a standard of “affordability” and provides the employee with “minimum value.”   Applicable large employers who do not offer their full-time employees health coverage that is affordable and provides minimum value may be subject to Employer Shared Responsibility Payments under section 4980H of the Internal Revenue Code if at least one of their full-time employees applies for health coverage through the Health Insurance Marketplace, and receives a premium tax credit to help pay for that coverage.

To determine whether applicable large employers are in compliance with the Employer Shared Responsibility Provisions, and to calculate and assess Employer Shared Responsibility Payments to employers who are not in compliance, the Internal Revenue Service (IRS) will require employers to file yearly returns under sections 6055 and 6056 of the Internal Revenue Code.  These returns will require employers to provide information on their full-time employees as well as the standards and conditions of any health coverage offered by the employer.  The applicable tax forms and instructions have been released in final form.  They can be found on the IRS website at:  http://apps.irs.gov/app/picklist/list/formsPublications.html by searching for Forms 1094-B, 1095-B, 1094-C, and 1095-C.

Determining Status as an Applicable Large Employer

For the purposes of determining whether an employer qualifies as an applicable large employer subject to the Employer Shared Responsibility Provisions in the ACA, employers must add the total number of their “full-time employees” to the total number of their “full-time equivalent employees.”  The IRS defines a “full-time employee” as an employee employed for an average of 30 or more hours per week.  This determination is generally made during the look-back period that the employer chooses to use.

The Division of Pensions and Benefits cannot determine whether a participating SHBP or SEHBP employer would be considered an applicable large employer or what safe harbor and look-back period employers may use.  Employers should consult their legal counsel with any questions on whether they are considered an applicable large employer and thus subject to the Employer Shared Responsibility Provisions.

The Division considers each State College/University its own entity; each having their own Federal EIN and being considered an autonomous tax entity in the eyes of the IRS. The SHBP maintains the health plans in which the State College/University participate, but it is not an employer.  Consequently, each individual entity will be responsible for adhering to the ACA guidelines, including determining its look-back period, and tracking hours to determine “full-time employees,” including adjunct faculty hours.

Guidance for determining your look-back period, administrative, and stability periods can be found in the Code Section 4980H regulations at:
http://www.gpo.gov/fdsys/pkg/FR-2014-02-12/html/2014-03082.htm

Liability for Employer Shared Responsibility Payments

Applicable large employers may be assessed an Employer Shared Responsibility Payment by the IRS if:

  1. The employer does not offer health coverage to substantially all (70% in 2015 and 95% thereafter) of its full-time employees (those averaging 30 hours of work per week or more) and their children, and at least one of the employer’s full-time employees receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace; OR

  2. The employer does offer health coverage to substantially all of its full-time employees and their children, but the coverage is unaffordable or does not provide minimum value to at least one full-time employee who receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace.

The amount of the assessed Employer Shared Responsibility Payment is calculated by one of two methods, as determined by the IRS:

  1. Applicable large employers who do not offer coverage to substantially all of their full-time employees and their children (as described in paragraph a above) are liable for a payment that is calculated separately each month.  The payment is triggered if even one of the employer's full-time employees applies for coverage through a Health Insurance Marketplace and receives a premium tax credit to help pay for the coverage.  The payment is equal to the total number of full-time employees employed by the employer (minus the first 30) multiplied by 1/12 of $2,000.

  2. Applicable large employers who do offer coverage to substantially all of their full-time employees may be liable for a payment if at least one full-time employee applies for coverage through a Health Insurance Marketplace and receives a premium tax credit to help pay for the coverage because (i) the employer's coverage is unaffordable; or (ii) the employer’s coverage does not provide minimum value. The payment is calculated separately each month and is equal to the number of full-time employees who get coverage through a Health Insurance Marketplace and receive a premium tax credit to pay for their coverage multiplied by 1/12 of $3,000.  This payment owed in this scenario cannot exceed the amount that the employer would have paid had it not offered coverage at all.

An applicable large employer could be subject to an Employer Shared Responsibility Payment based on the calculation method described in paragraph number 1 above if it does not offer health coverage to its employees who are considered to be “full-time” by the IRS definition, meaning those who average 30 or more hours of work per week. 

An applicable large employer could be subject to an Employer Shared Responsibility Payment based on the calculation method described in paragraph number 2 above if the coverage they offer their full-time employees does not meet the the standard of “affordability” or of providing “minimum value.”  The Division of Pensions and Benefits confirms that all available plans in both the SHBP and SEHBP exceed the “minimum value” standard required by the Employer Shared Responsibility Provisions.  The Division also confirms that any employer whose full-time employees are making contributions to their health care premiums based on Chapter 78, N.J. P.L. 2011 would meet the standard of offering coverage that is “affordable” according to the Employer Shared Responsibility Provisions.  This is true regardless of an employee’s coverage tier or salary band for all SHBP and SEHBP plans.  Any employers with agreements in place requiring that an employee contribute more than is required by Chapter 78, N.J. P.L. 2011 should review the IRS guidance to determine if their employees’ premiums are considered affordable.

Since the Division cannot confirm that all participating SHBP and SEHBP employers are offering coverage to all employees considered to be full-time as determined by IRS guidelines, and would not be aware if any employers have agreements calling for employees to contribute more than is required by Chapter 78, N.J. P.L. 2011, employers should act now to review their health benefit eligibility requirements to determine if any changes are needed.  IRS guidance and the participating employer’s legal counsel should also be consulted to determine whether any particular employee or group of employees qualifies as full-time according to IRS regulations.  If it is determined that any employees who qualify as a “full-time employee” during your look-back period are eligible for health benefits, they should be offered coverage by the employer.

IRS Reporting

The Affordable Care Act added sections 6055 and 6056 to the Internal Revenue Code, which require employers to file information returns with the IRS and provide statements to their full-time employees about the health insurance coverage the employer offered.  The information reporting requirements under those sections are effective for coverage offered in 2015.  Beginning in 2016, an applicable large employer (defined as those with at least 50 “full-time” or “full-time equivalent” employees) must furnish statements to employees and file information returns with the IRS to report information about its offers of health coverage to its full-time employees for calendar year 2015.  Employers will also provide a return to any employee (regardless of whether they are full-time) who actually takes the coverage offered by the employer.  This return must also list each of the employee's dependents who are covered, as well as the Social Security Numbers for the employee and the employee's dependents who are covered under the health coverage.

Employers should be working directly with their own payroll and human resource staff to develop and prepare for the issuance of all applicable tax forms and IRS filings.  The forms are complex and employers will need lead time to set up systems to capture relevant information.  All employers that participate in the SHBP/SEHBP receive information regarding health benefit coverage for their employees through the employer portal (EPIC).  Each participating employer is directly responsible for meeting the IRS reporting requirements, not the State of NJ Division of Pensions and Benefits.  However, in order to help facilitate the reporting efforts of participating employers, the Division is exploring ways to provide data , when possible.  

The Division will provide further updates as implementation of these requirements progresses.

ADDITIONAL INFORMATION

For more information regarding the determination of a full-time employee and employer responsibilities, see the Internal Revenue Code Section 4980H regulations at http://www.gpo.gov/fdsys/pkg/FR-2014-02-12/html/2014-03082.htmor the IRS website on the ACA's tax provisions at http://www.irs.gov/Affordable-Care-Act

To file a resolution for a change in the average number of hours per week required for “full-time status” for participation in the SHBP or SEHBP, complete the following form: http://www.state.nj.us/treasury/pensions/epbam/exhibits/pdf/ha0106.pdf

Employers with questions regarding any of the information provided in this letter can contact the Division’s Employer Education Unit at (609) 292-7524, or e-mail the Division at: pensions.nj@treas.nj.gov

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March 31, 2015

TO: Certifying Officers, Human Resources Directors, and Benefits Administrators Participating in the State Health Benefits Program (SHBP) and School Employees' Health Benefits Program (SEHBP)
FROM: New Jersey Division of Pensions and Benefits
SUBJECT: Affordable Care Act (ACA), Employer Shared Responsibility Provisions and Reporting Requirements

Employer Shared Responsibility Provisions in the ACA

According to the Employer Shared Responsibility Provisions in the Affordable Care Act (ACA), effective January 1, 2015, applicable large employers (defined as those with at least 50 “full-time” or “full-time equivalent” employees) may face a penalty if they do not offer their full-time employees the opportunity to enroll in health coverage that meets a standard of “affordability” and provides the employee with “minimum value.”  Applicable large employers who do not offer their full-time employees health coverage that is affordable and provides minimum value may be subject to Employer Shared Responsibility Payments under section 4980H of the Internal Revenue Code if at least one of their full-time employees applies for health coverage through the Health Insurance Marketplace, and receives a premium tax credit to help pay for that coverage.

To determine whether applicable large employers are in compliance with the Employer Shared Responsibility Provisions, and to calculate and assess Employer Shared Responsibility Payments to employers who are not in compliance, the Internal Revenue Service (IRS) will require employers to file yearly returns under sections 6055 and 6056 of the Internal Revenue Code.  These returns will require employers to provide information on their full-time employees as well as the standards and conditions of any health coverage offered by the employer.  The applicable tax forms and instructions have been released in final form.  They can be found on the IRS website at:  http://apps.irs.gov/app/picklist/list/formsPublications.html by searching for Forms 1094-B, 1095-B, 1094-C, and 1095-C.

Determining Status as an Applicable Large Employer

For the purposes of determining whether an employer qualifies as an applicable large employer subject to the Employer Shared Responsibility Provisions in the ACA, employers must add the total number of their “full-time employees” to the total number of their “full-time equivalent employees.”  The IRS defines a “full-time employee” as an employee employed for an average of 30 or more hours per week.  This determination is generally made during the look-back period that the employer chooses to use.

The Division of Pensions and Benefits cannot determine whether a participating SHBP or SEHBP employer would be considered an applicable large employer or what safe harbor and look-back period employers may use.  Employers should consult their legal counsel with any questions on whether they are considered an applicable large employer and thus subject to the Employer Shared Responsibility Provisions.

The Division considers each Local Employer its own entity; each having their own Federal EIN and being considered an autonomous tax entity in the eyes of the IRS.  The SHBP maintains the health plans in which the Local Employer participate, but it is not an employer.  Consequently, each individual entity will be responsible for adhering to the ACA guidelines, including determining its look-back period, and tracking hours to determine “full-time employees,” including adjunct faculty hours.

Guidance for determining your look-back period, administrative, and stability periods can be found in the Code Section 4980H regulations at:
http://www.gpo.gov/fdsys/pkg/FR-2014-02-12/html/2014-03082.htm

Liability for Employer Shared Responsibility Payments

Applicable large employers may be assessed an Employer Shared Responsibility Payment by the IRS if:

  1. The employer does not offer health coverage to substantially all (70% in 2015 and 95% thereafter) of its full-time employees (those averaging 30 hours of work per week or more) and their children, and at least one of the employer’s full-time employees receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace; OR

  2. The employer does offer health coverage to substantially all of its full-time employees and their children, but the coverage is unaffordable or does not provide minimum value to at least one full-time employee who receives a premium tax credit to help pay for coverage on a Health Insurance Marketplace.

The amount of the assessed Employer Shared Responsibility Payment is calculated by one of two methods, as determined by the IRS:

  1. Applicable large employers who do not offer coverage to substantially all of their full-time employees and their children (as described in paragraph a above) are liable for a payment that is calculated separately each month. The payment is triggered if even one of the employer's full-time employees applies for coverage through a Health Insurance Marketplace and receives a premium tax credit to help pay for the coverage.  The payment is equal to the total number of full-time employees employed by the employer (minus the first 30) multiplied by 1/12 of $2,000.

  2. Applicable large employers who do offer coverage to substantially all of their full-time employees may be liable for a payment if at least one full-time employee applies for coverage through a Health Insurance Marketplace and receives a premium tax credit to help pay for the coverage because (i) the employer's coverage is unaffordable; or (ii) the employer’s coverage does not provide minimum value.  The payment is calculated separately each month and is equal to the number of full-time employees who get coverage through a Health Insurance Marketplace and receive a premium tax credit to pay for their coverage multiplied by 1/12 of $3,000.  This payment owed in this scenario cannot exceed the amount that the employer would have paid had it not offered coverage at all.

An applicable large employer could be subject to an Employer Shared Responsibility Payment based on the calculation method described in paragraph number 1 above if it does not offer health coverage to its employees who are considered to be “full-time” by the IRS definition, meaning those who average 30 or more hours of work per week.  According to the provisions of Chapter 78, N.J. P.L. 2011, participating employers are permitted to offer SHBP or SEHBP coverage to employees who are employed for an average of as little as 25 hours per week. However, in accordance with N.J.S.A. 52:14-17.26 and N.J.S.A. 52:14-17.46.2, the SHBP and SEHBP also allow participating employers to file a resolution to authorize a change in the average number of hours required for “full-time” status for participation in the SHBP or SEHBP. However, please keep in mind for the purposes of the ACA, the IRS definition of “full-time employee” controls.

Participating employers should review the resolution they have filed with the SHBP or SEHBP.  Some participating employers have resolutions on file that require their employees to work more than an average of 30 hours per week in order to qualify for coverage under the SHBP or SEHBP. The Division of Pensions and Benefits is not mandating any changes to the current enrollment eligibility requirements of participating local government and educational employers. However, participating employers with resolutions on file requiring employees to work more than an average of 30 hours per week to qualify for coverage under the SHBP or SEHBP should confer with their legal counsel to determine if they would be subject to an Employer Shared Responsibility Payment, and if so, what the cost of that payment would be. Any liability for an Employer Shared Responsibility Payment owed to the IRS is assessed to the employer, as opposed to the plan or its administrator. As such, the Division of Pensions and Benefits, the SHBP, and the SEHBP will not be responsible for any employer shared responsibility payments assessed to participating local government and local educational employers.  Any participating employer wishing to change the average number of hours required for “full-time” status and participation in the SHBP or SEHBP may do so by completing and filing the resolution located on the Division’s website at: http://www.state.nj.us/treasury/pensions/epbam/shbp/shbp.htm

An applicable large employer could be subject to an Employer Shared Responsibility Payment based on the calculation method described in paragraph number 2 above if the coverage they offer their full-time employees does not meet the the standard of “affordability” or of providing “minimum value.” The Division of Pensions and Benefits confirms that all available plans in both the SHBP and SEHBP exceed the “minimum value” standard required by the Employer Shared Responsibility Provisions.  The Division also confirms that any employer whose full-time employees are making contributions to their health care premiums based on Chapter 78, N.J. P.L. 2011 would meet the standard of offering coverage that is “affordable” according to the Employer Shared Responsibility Provisions.  This is true regardless of an employee’s coverage tier or salary band for all SHBP and SEHBP plans. Any employers with agreements in place requiring that an employee contribute more than is required by Chapter 78, N.J. P.L. 2011 should review the IRS guidance to determine if their employees’ premiums are considered affordable.

Since the Division cannot confirm that all participating SHBP and SEHBP employers are offering coverage to all employees considered to be full-time as determined by IRS guidelines, and would not be aware if any employers have agreements calling for employees to contribute more than is required by Chapter 78, N.J. P.L. 2011, employers should act now to review their health benefit eligibility requirements to determine if any changes are needed.  IRS guidance and the participating employer’s legal counsel should also be consulted to determine whether any particular employee or group of employees qualifies as full-time according to IRS regulations.  If it is determined that any employees who qualify as a “full-time employee” during your look-back period are eligible for health benefits, they should be offered coverage by the employer.

IRS Reporting

The Affordable Care Act added sections 6055 and 6056 to the Internal Revenue Code, which require employers to file information returns with the IRS and provide statements to their full-time employees about the health insurance coverage the employer offered. The information reporting requirements under those sections are effective for coverage offered in 2015.  Beginning in 2016, an applicable large employer (defined as those with at least 50 “full-time” or “full-time equivalent” employees) must furnish statements to employees and file information returns with the IRS to report information about its offers of health coverage to its full-time employees for calendar year 2015.  Employers will also provide a return to any employee (regardless of whether they are full-time) who actually takes the coverage offered by the employer.  This return must also list each of the employee's dependents who are covered, as well as the Social Security Numbers for the employee and the employee's dependents who are covered under the health coverage.

Employers should be working directly with their own payroll and human resource staff to develop and prepare for the issuance of all applicable tax forms and IRS filings.  The forms are complex and employers will need lead time to set up systems to capture relevant information.  All employers that participate in the SHBP/SEHBP receive information regarding health benefit coverage for their employees through the employer portal (EPIC).  Each participating employer is directly responsible for meeting the IRS reporting requirements, not the State of NJ Division of Pensions and Benefits.  However, in order to help facilitate the reporting efforts of participating employers, the Division is exploring ways to provide data , when possible.  

The Division will provide further updates as implementation of these requirements progresses.

ADDITIONAL INFORMATION

For more information regarding the determination of a full-time employee and employer responsibilities, see the Internal Revenue Code Section 4980H regulations at: http://www.gpo.gov/fdsys/pkg/FR-2014-02-12/html/2014-03082.htm or the IRS website on the ACA's tax provisions at: http://www.irs.gov/Affordable-Care-Act  

To file a resolution for a change in the average number of hours per week required for “full-time status” for participation in the SHBP or SEHBP, complete the following form: http://www.state.nj.us/treasury/pensions/epbam/exhibits/pdf/ha0106.pdf

Employers with questions regarding any of the information provided in this letter can contact the Division’s Employer Education Unit at (609) 292-7524, or e-mail the Division at: pensions.nj@treas.nj.gov

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March 12, 2015

TO: Certifying Officers of thePolice and Firemen's Retirement System (PFRS)
FROM: Wendy Jamison, Board Secretary, Police and Firemen's Retirement System
SUBJECT: PFRS Notice of Election

This certifying officer letter and the attached notice for the 2015 Police and Firemen’s Retirement System (PFRS) “police” election is being transmitted to you electronically and will require your electronic response.

We are seeking your assistance in servicing an election for one “Police” Representative position, to the PFRS Board of Trustees.  A Police representative will be elected for a four-year term as of September 1, 2015.  Candidates for all positions must now qualify by electronic nomination.

We are requesting that you distribute the attached election notice electronically to each PFRS law enforcement member employed at your location, as the information will explain the pre-election procedures.  It is most important that each individual active PFRS Police member receives this notice.  If you are the certifying officer for multiple locations, you will only receive one certifying officer letter and will be required to distribute the attached election notice to active PFRS Police members at all locations.  Your attention to this distribution is required as regulated by N.J.A.C. 17:4-1.4.

We ask that you distribute this notice by the preferred method of distribution, which is electronically by no later than March 20, 2015.  If you are not able to accommodate electronic distribution, please make copies of the notice and provide to all active PFRS Police employees.  In addition, if you maintain a website for your employees, you may post the notice there and in any other appropriate public place at your location.

It is very important that you confirm distribution of this notice.  To confirm distribution of the notice to your active PFRS employees, please send an e-mail to NJBOT.ELECT@treas.nj.gov

Thank you for your prompt assistance in the timely response and distribution of this notice.

Attachment: Election Notice


DIVISION OF PENSIONS AND BENEFITS - NOTICE OF PFRS ELECTIONS
BOARD OF TRUSTEES OF THE POLICE AND FIREMEN’S RETIREMENT SYSTEM (PFRS)
One State Street Square - 50 West State Street - P.O. BOX 295 - Trenton, NJ 08625-0295 or NJBOT.Nomination@treas.nj.gov

Nominations are being accepted to fill the position of one elected police officer to the PFRS Board of Trustee to fill a vacancy* on the Board.  The term will begin on September 1, 2015 and will expire on August 31, 2019.  If you wish to declare your interest in running for the position, please send a written request to the PFRS Board Secretary at NJBOT.Nomination@treas.nj.gov  or PO Box 295, Trenton, NJ 08625-0295.

The general responsibility for the operation of the PFRS is vested in the Board of Trustees under the provisions of N.J.S.A. 43:16A-13.  The Board meets monthly at the Division of Pensions and Benefits in Trenton.  The statute provides that no employee shall suffer loss of salary or wages because of serving on the Board.  A member who wishes to be a candidate for the police position must be an active PFRS law enforcement officer and must be nominated by at least 500 active PFRS police members.  Only active PFRS police members may nominate a candidate for the PFRS police position.  

After the candidates have declared their interest in becoming a PFRS representative, nominations to support your choice for a candidate are now made electronically through a secure website.  Please be sure to allow sufficient time after this notification for active police members to request candidacy and to have ample time for the vendor to enter the member’s name to the online system.  Afterwards, the process is very easy and it only takes a few minutes to support the candidate of your choice.  You just need to have access to a computer and log on to https://vote.election-america.com/NJPFRS and follow the simple directions.  You will need to provide is the last 4 digits of your social security number, the first 4 letters of your last name, and your year/month of birth.  The list of those declaring their interest in being a candidate will then be available for your selection.

Nominations must be registered on-line on or before 4:00 p.m. Friday, April 24, 2015. If an election is needed, the ballots will be mailed to the PFRS employers on or about May 26, 2015.  All qualified candidates will be invited to attend the drawing by lot for position on the ballot, if necessary, on May 4, 2015.

We appreciate your assistance in supporting the electronic nominating process.  By doing so you are helping to decrease administrative costs and preserve resources!

PRESENT MEMBERS - TERM

Police Officers: Keith Bennett-6/30/18; *Vacancy-8/31/19; Firefighters: Timothy Colacci-6/30/16; Brady Middlesworth-6/30/18; Retired Member: Marty Barrett-12/31/16; Gubernatorial Appointments: Laurel Brennan; Vincent Foti; Frank Leake; Richard Loccke; State Treasurer Representative: Susanne Culliton, Ex Officio Member.

PFRS BOARD RESPONSIBILITIES

  • Render determinations regarding Disability retirement cases.

  • Review appeals pertaining to the disallowance of pension benefits.

  • Adopt rules and regulations to provide for the payment of benefits and collection of monies as required by the statute.

  • Establish rules and regulation within the limitations of statutes and opinions of the Courts and the Attorney General, designed to prevent injustices and inequities that may arise in the operation of the Retirement System.

  • Resolve individual questions on the merits of each case in terms of statutes, opinions of the Attorney General, advice of the Actuary and cases cited by counsel as deliberated by the Courts.

  • View monthly and annual reports setting forth data such as assets and liabilities, income and disbursements and statistical summarization of membership as documented by the Actuary.

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January 23, 2015

TO: Certifying Officers of the Judicial Retirement System (JRS), the Workers' Compensation Judges (WCJ) Part of the Public Employees' Retirement System (PERS), and the Office of Administrative Law (OAL)
FROM: New Jersey Division of Pensions and Benefits
SUBJECT: Special Provisions Related to JRS, PERS Judges of Workers' Compensation, PERS Administrative Law Judges and Bona Fide Severence of Employment

New Jersey State-administered retirement systems generally do not permit the payment of retirement benefits without a bona fide severance from public employment.  This memorandum supplements that of August 22, 2014, and addresses the special provisions for retired members of the Judicial Retirement System (JRS), the Workers’ Compensation Judges Part of the Public Employees’ Retirement System (PERS), Judges of Workers’ Compensation enrolled in the standard PERS and Administrative Law Judges (ALJs) enrolled in the PERS in regards to post-retirement employment. 

INTERNAL REVENUE CODE

The JRS and the PERS1 are established as qualified governmental defined benefit plans in accordance with Internal Revenue Code (IRC) Sections 401(a) and 414(d).  In order to preserve the qualified status of these plans and to protect retirees from a 10 percent excise tax penalty on their monthly retirement payments, the Division of Pensions and Benefits was required to adopt and to enforce regulations to ensure compliance with the IRC requirements.

“Compliance with Internal Revenue Code” was adopted as a special new rule, effective March 9, 2012, under Title 17, Chapter 1, Subchapter 17, of the New Jersey Administrative Code.  The provisions of N.J.A.C. 17:1-17.14 were needed to clarify criteria regarding retiree re-employment. 

N.J.A.C. 17:1-17.14.2(a) states:

"‘Bona fide severance from employment’ means a complete termination of the employee's employment relationship with the employer for a period of at least 180 days. The following does not constitute a complete termination of the employee's relationship with the employer:

  1. Employment or re-employment in a part-time position;

  2. Employment or re-employment in a position that is not covered by the Defined Benefit Plan;

  3. A change in title;

  4. Employment or re-employment as a contract employee, a leased employee,2 or an independent contractor; or

  5. Termination of employment with a pre-arranged agreement for re-employment.
Federal Internal Revenue Service factors shall be used as guidance in determining whether an employment relationship exists.  A mandatory retirement shall be treated as a ‘bona fide severance from employment.’”

Also, N.J.A.C. 17:1-17.14.2(b) provides as follows: 

In accordance with the N.J.S.A. 43:3C-18, the defined benefit plans are established as qualified governmental defined benefit plans in accordance with Internal Revenue Code Sections 401(a) and 414(d), or such other provision of the Federal Internal Revenue Code as applicable, regulations of the United States Department of the Treasury, and other guidance of the Federal Internal Revenue Service.

Federal law does permit the distribution of an in-service retirement benefit under certain conditions as detailed in N.J.A.C. 17:1-17.14.2(c):

In order to maintain qualified plan status, as set forth in (b) above, Federal law requires that a defined benefit plan pay retirement benefits to a member only when there is bona fide severance from employment unless both of the following conditions are met:

  1. The member has attained normal retirement age under the defined benefit plan; and

  2. A defined benefit plan provides for the distribution without a bona fide severance from employment (also referred to as an "in-service distribution").

Recalled Judges (JRS and PERS)

Pursuant to N.J.S.A. 17:17.14.2, the 180-day requirement of a bona fide severance does not apply to a JRS retiree, a retired Judge of Compensation, or a retired Administrative Law Judge, provided the judge attained age 60 prior to retiring from the JRS or PERS, and was recalled to service under one of the following statutory provisions:

  • N.J.S.A. 43:6A-13 — Provides for the recall of retired justices and retired judges of the JRS by the Supreme Court for temporary service and permits the retiree to continue to receive retirement benefits from the JRS. The retired justice or judge may be paid a per diem allowance fixed by the Supreme Court, which, when added to the retirement allowance, cannot exceed the current salary of a justice or judge of the court from which he or she retired.
  • Chapter 6, P.L. 2005 — Allows retired administrative law judges and workers' compensation judges to be recalled for service, with the judge's consent.  It amends N.J.S.A. 52:14F-4 and N.J.S.A. 34:15-49, which requires these judges to retire upon attaining age 70, to provide that upon such recall the retired administrative law judge or judge of workers' compensation will have all the powers of such a judge and will be paid a per diem allowance to be fixed by the Director/Chief Administrative Law Judge or the Director/Chief Judge of the Division of Workers' Compensation, as applicable.  The recalled judge will be reimbursed for reasonable expenses actually incurred in connection with the assignment and will be provided with such facilities as may be required in the performance of the judge's duties.  Those per diem compensation and expenses will be paid by the State.  Payment for services and expenses will be made in the same manner as payment is made to the judges of the Office of Administrative Law or Division of Workers' Compensation, as applicable, from which the judge retired.

Age-Related Mandatory Retirement

The 180-day requirement of a bona fide severance also does not apply to judges who were required to retire under the age-related mandatory retirement provisions of the statutes.  In these situations, the age-related mandatory retirement is considered a “bona fide severance from employment.”

EMPLOYER RESPONSIBILITIES

Completion of a Notification of Employment After Retirement form is not required for judges recalled to service under N.J.S.A. 43:6A-13 and Chapter 6, P.L. 2005; however, the form should be completed for all other circumstances when retaining the services of a judge who is retired from one of the New Jersey State-administered retirement systems. For more information, see Certifying Officer letter dated August 22, 2014.

ADDITIONAL INFORMATION

Additional information regarding the taxability of pension benefits can be found in Fact Sheet #12, Taxation of Retirement Benefits.  For specific questions regarding the tax implications of returning to employment after retirement, current or former employees should consult with a professional tax advisor or contact the IRS at 1-800-TAX-1040.

If you have general questions regarding 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 at: https://www.state.nj.us/treas/pensions/pensionmail.shtml

1Chapter 92, P.L. 2007, closed the Workers’ Compensation Judges Part of the PERS to new members as of July 1, 2007.  After the establishment of the Defined Contribution Retirement Program in July 2007, only those individuals with an active Tier 1 PERS membership were permitted to remain in the PERS upon appointment as a Judge of Workers’ Compensation or an Administrative Law Judge.

2This includes services provided to all employers who are party to a shared service agreement with the former employer.

CO Letter in Printable Format Adobe PDF (64K)

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