pre retirement webinar - crcc benefitspre‐retirement webinar 1 if you are having trouble hearing...

1

Welcome to the Chicago Regional Council of Carpenters

Benefits Funds

Pre‐Retirement Webinar

1

If you are having trouble hearing the webinar over your computer audio,

you can watch the webinar on your computer and listen on your telephone.

Call (562)247‐8321Enter Access Code 700‐592‐426

2

2

Before you leave the webinar, please take a moment to complete the short survey that will appear at the end of the webinar.

Your feedback is important.

Thank You!

Survey

3

Webinar Handouts

The handouts for the webinar can be accessed by clicking on the orange and white arrow button. You can download and save the handouts.

The handouts were also emailed to you before the webinar.

Additionally, you were sent an email with your personal pension credit history, benefit estimates, beneficiary designation dates, and SRP balance.

4

3

We will pause for audience questions at the end of each

section.

To submit a question, click on the question button on your screen.

Type and submit your question.

Questions

5

Many of our staff members are working remotely

to meet your needs as best as possible during this time.

Help & appointments are available via telephone.

Contact the Retirement Benefits Department at

(312) 787‐9455, telephone menu option #4.

We are open Monday through Friday,

8:00 AM – 4:30 PM Central time.

Questions

6

4

Severance of Employment & Prohibited Employment

How Your Pension Benefits Are Calculated Your Pension Plan Payment Options The Supplemental Retirement Plan Retiree Healthcare Premiums & Coverage

Today’s Topics

7

Retirement &

Suspension of Benefits

8

5

To commence pension benefits, IRS regulations require a legitimate severance of employment. This means that:

(1) You must not be working in any type of Prohibited Employment AND (2) You must cease employment in any capacity with any Employer who is signatory to the Pension Fund and have no intent to return to employment with a signatory Employer.

To Start Your Pension IRS Regulations Require a

Legitimate Severance of Employment

9

A pre‐arranged termination and subsequent pre‐arranged re‐hire does not qualify as a legitimate severance of employment.

You must cease performing services and have no intent of returning to work for any employer who contributes to the Pension Fund.

To Start Your Pension IRS Regulations Require a

Legitimate Severance of Employment

10

6

If you have reached Normal Retirement Age (65) and you are not performing work that is considered Prohibited Employment you do not need to sever employment in order to start your pension benefits.

Exception to the Severance of Employment

Requirement

11

Employment after retirement:

Before Age 65: You may not work in any occupation that is considered Prohibited Employment

Age 65 to Age 70½: You may work in an occupation that is considered Prohibited Employment for LESS THAN 40 hours per month (This is known as the “39 Hour Rule”) Must complete a “39 Hour Rule” Form & Return the Form to the

Fund Office.

Age 70½ and older – No work restrictions

Prohibited Employment Rules(see Pension Information Handout pages P‐3 to P‐5)

12

7

If you are considering returning to employment after retirement, before you return to work you must send a written job description (prepared by the employer on the employer’s stationery) to the Retirement Benefits Department for a determination as to whether or not the job is considered Prohibited Employment.

A written determination will be sent back to you for your records.

Before You Return to Work

13

How Your Pension Plan Benefits Are Determined

14

8

Less than 250 hours no Pension Credit250 but less than 500 hours 0.25 Pension Credit500 but less than 750 hours 0.50 Pension Credit750 but less than 1000 hours 0.75 Pension Credit1000 but less than 1500 hours 1.00 Pension Credit1500 but less than 1750 hours*** 1.25 Pension Credit1750 or more hours*** 1.50 Pension Credit

However, a maximum of 1.00 year of credit per calendar year is counted toward VESTING SERVICE.

***For the Construction Plan: Starting in 1989, it became possible to earn 1.25 or 1.50 Pension Credits per calendar year.

How Credit is Earned

15

Look at Your Personalized Credit Printout (“A”)

16

9

Vesting Credit is used to determine:

Whether or not you are eligible for a pension

Whether or not you are eligible for Retiree Healthcare Benefits

How much you pay for Retiree Healthcare Benefits

Pension Credit is used to determine the amount of your monthly pension benefit.

Pension Credit vs. Vesting Credit

17

Look at Your Personalized Estimate (“B”)

18

10

Earned Pension Credits are multiplied by the

applicable “Benefit Accrual Rate”

The current Construction Plan “Benefit Accrual Rate” is $100.00 per Pension Credit provided that there is not a “Three Year Break For Calculation.”

The current Millmen Plan Rate is $66.00 per Pension Credit, provided that there is not a “Three Year Break For Calculation.”

Early Reduction Factor

Construction Plan 5% per year for each year younger than age 60

Millmen Plan is approximately 6.6% for each year younger than age 65

How is Your Pension Calculated?

19

Participant is 60 years old, worked for 41 years (1979‐2019)

and earned 49.50 Pension Credits and never incurred a 3 year break for calculation.

A) 60 Certain Guarantee1979‐2019 49.50 x $100.00 x n/a = $ 4,950.00

Pension Benefit Reduction Monthly

Credits Accrual Factor for AmountRate Participant’s

Age *

* No early reduction for this participant as he participates in the Construction Pension Plan and is age 60.

Pension Benefit Calculations

20

11

Participant is 58 years and 2 months old.Participant worked for 32 years (1988 to 2019)

and earned 42.00 Pension Credits.

A) 60 Certain Guarantee1988‐2019 42.00 x $100.00 x .90833 = $3,185.00

Pension Benefit Reduction Monthly AmountCredits Accrual Factor for

Rate Participant’sAge *

* Construction Plan Participant is 58 years and 2 months old. Reduction is 5% per year for each year younger than 60 (pro‐rated by month).

Pension Benefit Calculations(Early Reduction Factor)

21

58 year old participant Worked from 1988 – 1996 and earned 11.75 Pension Credits Participant did NOT earn any credit from 1997 – 1999 (3 year calculation break) Worked from 2000 – 2019 and earned 21.75 Pension Credits

A) 60 Certain Guarantee1988‐1996 11.75 x $50.00 x .90000 = $ 528.752000‐2019 21.75 x $100.00 x .90000 = $ 1,957.50

Pension Benefit Reduction $ 2,486.50 Credit Accrual Factor for Monthly Amount

Rate Participant’sAge *

* Construction Plan Participant is 58 years old. Reduction is 5% per year for each year younger than age 60(pro‐rated by month).

Pension Benefit Calculations(3 Year Calculation Break)

22

12

50% Joint and Survivor 75% Joint and Survivor 100% Joint and Survivor All have a built in “Pop‐Up” Feature

Joint and Survivor Payment Options

23

Pension Benefit CalculationsJoint & Survivor Payment Options

Participant is age 60, Spouse is also age 60

B) 50% Joint and Survivor Option

$4,950.00 x 90.000% = $4,455.00 $2,227.50

participant surviving spouseC) 75% Joint and Survivor Option

$4,950.00 x 85.500% = $4,232.50 $3,174.50participant surviving spouse

D) 100% Joint and Survivor Option

$4,950.00 x 81.000% = $4,009.50 $4,009.50

participant surviving spouse

24

13

Look at Your Personalized Partial Lump Sum Estimate (“C”)

25

Pension Benefit CalculationsPartial Lump Sum Option

Monthly Amount $4,950.00 x 10.00% = $495.00

$495.00 x 188.9634 = $93,536.88

10.00% of benefit Actuarial Factor Partial LumpSum Payment (10% Maximum)

$4,950.00 minus $495.00 = $4,455.00

Monthly Amount 10.00% Adjusted Monthly Amount

26

14

Pension Benefit CalculationsPartial Lump Sum Option

ADJUSTED Monthly Payments if Partial Lump Sum is Elected

A) 60 Certain Guarantee Amount $4,455.00

B) 50% Joint & Survivor Option 90.000% $4,009.50 $2,004.75

C) 75% Joint & Survivor Option 85.500% $3,809.00 $2,857.00

D) 100% Joint & Survivor Option 81.000% $3,609.00 $3,609.00

participant surviving spouse

27

Paid Directly To You

Added to Taxable Income for the Year (unless you make an indirect rollover within 60 days)

Pension Fund Required to Withhold20% Federal Income Tax

(if you elect an indirect rollover, you must “make up” this 20%, otherwise this 20% is added to taxable income for the year)

Partial Lump Sum Option

28

15

Direct Rollover to Traditional IRA

Payment will not be taxed in current year

No Mandatory Federal Income Tax Withholding

Payment will be made directly to traditional IRA or qualified plan

Payment will be taxed as you withdraw from the traditional IRA


29

Direct Rollover to ROTH IRA

Payment will be taxed in current year

NOT taxed as you withdraw from the ROTH IRA

See IRS Publication 590 for more details (www.irs.gov)


30

16

We will take a

5 minute break.

BREAK TIME

31

SSA.gov

32

17

Sample Social Security Estimate

33

Must be at least 60 years old and have “current” Pension Credit.

This option makes it possible for you to receive approximately the same monthly income for life, taking into account your Pension Fund benefit and

your Social Security benefit.

Level Income Option(Construction Pension Fund)

34

18

Participant is electing to retire

& apply for pension at age 60.

Participant worked for 37 years (1983‐2019)

and earned 42.00 Pension Credits.

Level Income Option Example

35

Example of theLevel Income Option

The “60 Certain Guarantee” from the Pension Fund is calculated as follows:

42.00 x $100.00 = $4,200.00

‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐

$4,200.00

Pension Benefit “60 Certain Guarantee”

Credits Accrual Monthly Benefit Amount

Rate

36

19


Estimated Social Security Benefit is $1200.00 per month at age 62.

The Level Income Amount payable from the Pension Fund is calculated as follows:

$1200.00 x 0.8580 = $1029.60

Social Security Level Income Level Income Amount

Amount Factor Payable from Pension Fund

37


The Level Income Amount is added to the “60 Certain” Monthly Benefit Amount:

$4,200.00 + $1029.60 = $5,229.60

“60 Certain” Level Income Total Payable from

Benefit Amount Amount Pension Fund BeforeSocial Security Begins

38

20


Two months after the participant reaches age 62 and begins collecting Social Security, the benefit from the Pension Fund is adjusted:

$5,229.60 ‐ $1,200.00 = $4,029.60

Benefit Before Amount Receiving Total Payable from

Social Security From Social Security Fund After Social

Security Begins

39

Construction Plan –

15 Pension Credits OR 10 Pension Credits provided that you earned at least ¼ credit in the calendar year that you become disabled or any of the immediately preceding five calendar years

Millmen Plan –

10 Pension Credits provided that you earned at least ¼ credit in the calendar year that you become disabled or any of the immediately preceding twocalendar years

Disability Pension

40

21

You are unable to engage in any substantial gainful work activity. Being unable to work is a carpenter

or in the building trades does not satisfy this requirement.

“Substantial work activity” is work that utilizes physical or mental duties or a combination of both.

“Gainful activity” is work performed for profit (you are paid).

Social Security Disability “gainful activity” limit for 2020 is $1,260 per month

What does Disabled mean under the provisions of the Pension Plan?

41

Must submit EITHER:

SSD Award letter indicating that you are receiving disability benefits under Title II of the Social Security Act OR

Medical Records substantiating your claim of disability. Your medical records will be submitted to the Pension Fund’s independent medical consultant for review. The consultant will determine whether or not you meet the Pension Fund’s definition of disability.

Disability PensionRequired Documents

42

22

No “Early Reduction” Factor

Calculated as if you were 60 [65 for Mill] years old

Payable as 60 Certain Guaranty

50%, 75% & 100% Joint & Survivor Options are available

Partial Lump Sum Option is available

Level Income Option is not available

Disability Pension

43

Can do non‐carpentry/non‐building trade type employment without losing Disability Pension

provided that your earnings do not exceed the Social Security “substantial gainful activity” earnings limit, as

adjusted annually.

2020 limit is $1,260 per month

Disability PensionWork Restrictions

44

23

If Married at Least One Year @ Time of Death

(Unless Death is Accidental)

Construction Fund = 100% Joint & Survivor Benefit

If Married at Least One Year @ Time of Death

Millmen Fund = 50% Joint & Survivor Benefit

Pre‐Retirement Death Benefits

45

If NOT Married at Least One Year @ Time of Death

If Early Retirement Age = Pre‐Retirement 60 Certain

If NOT Yet Early Retirement Age At least 15 years OR 10 years with ½ year earned in year of death or immediately preceding 2 years there is a Death Benefit of years of credit multiplied by the death benefit rate. Total due is paid in 60 equal monthly installments.

Current death benefit rates: Construction = $875.00 Mill = $345.00

Pre‐Retirement Death Benefits

46

24

Look at Your Personalized Beneficiary Printout (“D”)

47

The Construction Pension Fund provides a

$3,000 Lump Sum Death Benefit

payable to the beneficiary of a participant

who is receiving a monthly pension

at the time of death.

The Millmen Pension Fund provides a

$2,000 Lump Sum Death Benefit

Lump Sum Death Benefit from the Pension Fund

48

25

When Should I File my Application?

There are Federal Regulations that require that several of the election forms be provided to you no earlier than 180

days in advance BUT no later than 30 days in advance of the date benefits begin UNLESS you and your spouse waive the

30 day time frame in favor of a 7 day time frame.

These time frames are complex. Therefore, we recommend that you submit your application approximately

NINETY (90) DAYS IN ADVANCE OF THE DATE THAT YOU WANT YOUR PENSION TO BEGIN

49

Effective Date – Date you are first entitled to benefits

Award Date – Date we issue your first check

If your award date is later than your effective date,

your first check will include

any retroactive payments

that may be due to you.

Effective Date vs. Award Date

50

26

Approximately 3‐4 months after your pension begins the Retirement Benefits Department checks for additional credit. If additional credit was earned, your pension is recalculated and you are paid any retroactive money that may be due to you.

Full adjustment is made to the monthly benefit (no adjustment to partial lump sum option amount)

Annual age 65 & age 70.5 adjustments

Credit Adjustments

51

Required Documents – Proof of Age & Marriage • Copy of Gov’t Issued Photo ID (participant & spouse)

• Copy of Social Security Card (participant)

Construction Fund Pension Application

Mandatory Direct Deposit starts with 2nd payment

Federal Tax Election

Federally Required “Pension Benefit Payment Options & Relative Value Explanation & Consequences of Failing to Defer Benefits”

Other Information in the Handouts

52

27

As of June 1, 2020 current contribution rate is $8.00 per Hour of Service

into the Supplemental Retirement Plan

Record Keeper:

John Hancock Retirement Plan Services

Supplemental Retirement Plan

53

Consider leaving your money in your account and withdrawing as needed.

Partial distributions can be made once every 12 months.

You may also consider electing installment payments on a monthly, quarterly, or annual basis. You can change the amount/frequency of installments once every rolling 12 months.


54

28

To Request a SRP Distribution Application Contact John Hancock at (855) 312‐CRCC (2722)

OR

Log in to the John Hancock website with your user ID and password myplan.johnhancock.com/login


55

Return the completed SRP distribution application to the

Fund Office Retirement Benefits Department


56

29

We will take a

5 minute break.

BREAK TIME

57

Retiree Healthcare Coverage Options

58

30

Eligibility Requirements

Premiums

Active Eligibility vs. Retiree Eligibility

Postponing Enrollment

Types of Coverage Before Medicare Eligible

After Medicare Eligible

Retiree Healthcare Benefits

59

In general you must have 10 years of Vesting Credit to qualify for Retiree Healthcare Benefits. (Remember: Max of 1.00 year of Vesting Credit can be earned per calendar year.)

If at any time you did not earn credit for 3 or more consecutive calendar years, you must have 15 years of Vesting Credit to qualify for Retiree Healthcare Benefits.

Are You Eligible for Retiree Healthcare Benefits?

60

31

Current Retiree Healthcare Premiums

(**May increase in the future**)Separate/Additional Premiums Apply for Dental & Vision Coverage

61

If you are eligible for the Retiree Plan and if you enroll in Retiree Plan coverage, then the Retiree Healthcare Benefits will begin on your pension Award Date.

What Happens if I am NOT Eligible for

Active Plan Healthcare Benefits When My Pension Begins?

62

32

When you fall below 1,000 hours for the past 4 quarters, your eligibility for the Active Plan of Benefits will end.

Two Options:

1. Active Benefits Retiree Benefits 2. Active Benefits COBRA (max 18 months) Retiree Benefits

If you are eligible for the Retiree Plan and you enroll in Retiree Plan coverage, then the Retiree Healthcare Benefits will begin the first month after the Active Plan of Benefits end (or after COBRA ends, if you elect continuation coverage under COBRA) .

You complete the Retiree Plan enrollment forms when you complete your pension application. You do not wait until the Active Plan benefits end before completing the enrollment forms.

What Happens When my Active Plan Healthcare Benefits End?

63

Active Plan Deductibles and/or Out of Pocket Coinsurance Maximums do NOT carry over from the Active Plan to the Retiree Plan.

Retiree coverage does NOT include the ComPsych Network (behavioral health and/or substance use disorder) or Absolute Solutions (radiology/imaging). These things are covered under the Retiree Plan, but they are subject to the Retiree Plan’s PPO & non‐PPO deductibles and co‐payments

IMPORTANT

64

33

What if you do not elect coverage at the time you retire?

You, your spouse, or your dependent child may postpone coverage under the Retiree Healthcare Benefits PROVIDED THAT the individual who is postponing has continuous coverage with another healthcare plan. (See page H‐12 of the Health Benefit Information handout for 105 day gap rule.)

The other healthcare plan does NOT need to be an employer plan. (You can consider coverage through the Marketplace.)

The Retiree Healthcare Benefits must begin immediatelyfollowing the termination of coverage under the other healthcare plan.

You should request enrollment forms from the Fund Office at least 30 days before coverage under the other healthcare plan ends.

65

Comprehensive Medical Benefits(NOT Medicare Eligible)

PPO NON‐PPO

Annual Deductible $300 per individual

$600 per family

$600 per family

Coverage / Co‐Payment 80% / 20% 60% / 40%

Annual Coinsurance Maximum

Individual=$2,000

Family = $4,000

Individual=$6,000

Emergency Room Co‐PaymentIf you are admitted to the hospital within 72 hours of the Emergency Room visit (for the same condition) or held in the observation unit for more than 24 hours, the $250 co‐pay will be WAIVED.

$250 $250

66

34

Medicare Part A‐ Inpatient hospital stays‐ Skilled nursing facility stays after a covered hospital stay

‐ Some home and hospice care

Medicare Part B‐ Professional Fees (ex: doctor’s visits, surgeon charges)‐ Lab tests‐ Some preventative services that aren’t covered by MedicarePart A

Medicare:

What are Part A and Part B?

67

Secondary Comprehensive Medical Coverage(Medicare Eligible)

Supplements Medicare Part A

Pays Medicare Part A Deductible

2020= $1,408.00 (for first 60 days of care)

Covers Medicare required co‐payments

2020 = $352.00 per day (for 61st through 90th of care)

68

35

Secondary Comprehensive Medical Coverage

(Medicare Eligible)

Medicare Part B Premium (You Pay)

2020 Part B Medicare premium = $144.60 per month for those new to Medicare

Annual income less than $85,000 (single) or $170,000 (married)

Medicare Part B Deductible (Plan Pays)

2020 Part B Medicare Annual Deductible = $198.00

Medicare pays 80% of approved amounts

The Plan pays the remaining 20% of Medicare approved amounts69

RetailMaximum of 3 fills allowed at retail for Long Term Medication

Mandatory Home Delivery for Long Term Medication: Through the Home Delivery Program you receive a 90 day supply of medication

Out‐of‐pocket maximums:$1,500 Annual OOP for Specialty Meds$1,500 Annual OOP for Single Source Brands$1,500 Annual OOP for Multi Source Brands & Generics

Prescription Drug Benefits(Express Scripts)

70

36

Prescription Drug Benefits (ESI)

Retail(30 days or 100 units whichever is less)

Home Delivery

(90 day supply)

Generic $5.00 co‐pay $12.50 co‐pay

Single Source Brand Generic does NOT exist

20% co‐pay($10 min &

$100 max co‐pay)

20% co‐pay($25 min &

$250 max co‐pay)

Multi Source BrandGeneric exists, but you elect the

brand name for any reason

35% co‐pay($20 min co‐pay)

35% co‐pay

($50 min co‐pay)

Specialty DrugsAccredo Specialty Pharmacy

Home Delivery

30 Day Supply

n/a

20% co‐pay($20 min co‐pay &

$100 max co‐pay)

71

Retiree Dental Coverage Option

See handouts (page H‐23) for coverage chart

Separate Premium Required

One Individual Enrolled = $44.53 per month

Two Individuals Enrolled = $86.42 per month

Family (3 or more) Enrolled = $153.33

(**Premiums May increase in the future**)

72

37

Retiree Vision Coverage Option

See handouts (page H‐26) for coverage chart

Separate Premium Required

One Individual Enrolled = $6.20 per monthTwo Individuals Enrolled = $11.96 per month

Family (3 or more) Enrolled = $18.22 per month

(**Premiums May increase in the future**)

73

Hearing Evaluations/Examinations are covered at 100% coverage up to $150 every 2 years

Hearing Aids ‐ $5,000 every 5 years

Utilize EPIC Hearing Network

*Individual must be covered under the Retiree Comprehensive Medical Benefits orComprehensive Medicare Supplement Benefits to be eligible

Hearing Benefits*

74

38

Chiropractic/Acupuncture/Naprapathy Care Participant: Max 50 combined visits per year Spouse: Max 30 combined visits per year Not available to dependent children

Comprehensive Health Evaluation & Physical Exam through Health Dynamics

Available participants & spouses (pre and post Medicare) Not available to dependent children

*Individual must be covered under the Retiree Comprehensive Medical Benefits or Comprehensive Medicare Supplement Benefits to be eligible

Additional Benefits*

75

$25,000 Life Insurance

for the Participant

The benefit is fully insured through The Hartford (formerly Aetna)

Payable if the retired participant passes away beforereaching his/her 65th birthday

*Participant must be covered under the Retiree Comprehensive Medical Benefits or Comprehensive Medicare Supplement Benefits to be eligible

Life Insurance Benefit*

76

39

Lisle Campus

Carpenters Centers for Health & Vision

77

Your surviving spouse can continue the Health Benefits at the same

premiums that the Retired Carpenter pays!

What Health Care Benefits Will My Surviving Spouse Receive?

78

40

Before you leave the webinar, please take a moment to complete the short survey that will appear at the end of the webinar.

Your feedback is important.

Thank You!

Survey

79

Many of our staff members are working remotely

to meet your needs as best as possible during this time.

Help & appointments are available via telephone.

Contact the Retirement Benefits Department at

(312) 787‐9455, telephone menu option #4.

We are open Monday through Friday,

8:00 AM – 4:30 PM Central time.

Questions

80

41

Thank you for attending our very first webinar.

We hope you found it informative.

81