The University Senate of Michigan
Technological University
PROPOSAL 12-98
(Voting Units: Full Senate)
REVISION OF THE RETIREMENT MEDICAL
PLAN
The Senate proposes that the University revise the AMedical Retirement Plan for Certain Michigan
Technological University Faculty and Staff@ to incorporate the following principles:
1. Making and Promulgating Revisions to the Plan
Faculty and Staff (through the University Senate and
Staff Council) shall be consulted in advance of any proposed changes in the
provisions of the Plan or in any supporting documents; their requests shall be
seriously considered, with reasons given in writing if denied. The Retirement
Medical Benefits Plan shall incorporate all schedules, supplements, (such as
rates for dependent contributions, co-payments, deductibles, &c) and the
like. It shall be in force when all
parts, including the supplements, are made accessible to all affected parties
by distribution to individuals or units of MTU, and deposited in the J.R. Van
Pelt Library.
Relevant articles:
(Revisions): '1.13, '2.2, '3.1, '3.3, '4.1(a) & (b), '5.1, '5.1(c) & (d), '7.1(a)
& (b), '8.8.
Promulgation: '1.13, '8.8.
2. Denial of Claims; Appeals
The University shall notify the claimant of any
denied claims within 30 days; appeals shall be decided by a board on which
faculty and staff have a majority; the claimant may examine any documents
he/she deems pertinent, subject to outside arbitration in the event of
objection by the University.
Relevant articles: '6.1, '6.3, '6.4.
3. Exclusion for Nonpayment
Individuals may not be excluded from the Plan
without possibility of reinstatement if the circumstances leading to such
exclusion were beyond the control of the retiree. Benefits of a bankrupt retiree are to be applied
to beneficiaries as the Review Board may deem proper. [In several instances, the present language
of the Plan does not reflect the policy change approved by the Board in
November 1977].
Relevant articles: '2.3, '4.2, '8.3.
4. Setting of Costs
Periodically, a review of MTU=s self-insured status, including MTU=s recent cost history and comparisons with national
norms, shall be made available to the MTU community.
Relevant articles: '4.1(a)
& (b).
5. Coverage in the Event of Failure of Provider or
of the University
In the event that the University=s administrator of medical benefits fails, or if the
University=s own funds are depleted, the medigap premiums
collected shall be used only for the purpose for which they were collected.
Relevant articles: '3.1, '4.3, '5.3.
6. Retiree Benefits Matching those of Working
Employees
Benefits for retirees shall be equal or better to
those available at the time of the employee=s
retirement. If benefits for current employees increase, retirees should receive
equivalent improvements in their benefits.
Relevant article: '1.12.
Appendix
The Appendix (handout) contains (1) a list of
proposed changes in specific wording designed to incorporate the above
principles into the Plan; (2) the specific wording of a number of editorial
changes also recommended by the Senate.
Proposal Background
On October 19, 1992, the University released its
" Retirement Medical Benefit Plan for Certain Michigan Technological
University Faculty and Staff." Amendments to the Plan were released on May
9, 1997 (effective July 1, 1997) Further
revisions to that document were approved by the Board of Control at its meeting
of November 21, 1997, in response to suggestions from the Chair of the MTU Senate
Fringe Benefits Committee. This proposal
requests a number of additional changes.
Proposal Development
Changes in the Plan were authorized by the Board of
Control on November 21, 1997; the changes proposed here extend the spirit of
the Board=s revisions to articles of the Plan not covered
then. The proposal was approved by the
Fringe Benefits Committee and submitted to the Senate on May 7, 1998.
APPENDIX TO PROPOSAL 12-98
1. Making and Promulgating
Revisions to the Plan
Article 1, '1.13
(Page 3): A>Supplement=
means the Supplement attached to the Plan, which is incorporated into it by
reference, as amended periodically by the Plan Administrator, which sets forth
the Benefit Documents that are part of the Plan, the required contributions for
a Participant, the Participant=s spouse, and dependent Children, and the
deductibles and co-pays from time to time in effect.@
AAll supplementary materials affecting employees and
retirees are appended. Faculty and Staff
(through the University Senate and Staff Council) shall be consulted in advance
of any proposed changes in the provisions of the Plan or in any supporting
documents; their requests shall be seriously considered, and reasons given in
writing if denied. Contributions,
deductibles, and co-pays are to be demonstrably consistent with industry
norms. The Plan shall be in force when
all parts, including the supplements, are made accessible to all affected
parties by distribution to individuals or units of MTU, and deposited in the
J.R. Van Pelt Library.@
Article 2.2; second full sentence:
"By becoming a Participant, each Employee and
each Employee's covered spouse and Dependent Child, if any, shall, for all
purposes, be deemed conclusively to have consented to the provisions of the
Plan and all subsequent amendments."
Article 3, '3.1
(Page 6): A . . .The terms and conditions of any insurance
contract or policy may be revised at any time, for any reason, at the Employer=s sole discretion.@
Article 3, '3.3
(Page 6): AThe Employer may self-insure any Benefit under this
Plan. The Employer shall pay the cost of
any self-insured Benefits out of its general assets or otherwise. The Employer may revise the terms and
conditions of any self-insured benefit under this Plan at any time for any
reason, in the Employer=s sole discretion only in full consultation with the Faculty and Staff as provided in
Article 1.13.@
Article 4, '4.1(a)
(Page 8): ATo obtain coverage,
. . . each participant is
required to make a contribution in such amount as the plan administrator, in
consultation with the Faculty and Staff as provided in Article 1.13,
determines from time to time, as set forth in the supplement. Periodically (that is, at intervals no
greater than three years), a review of MTU=s
self-insured status, including MTU=s recent cost history and comparisons with national
norms, shall be made available to the MTU community.
Article 4, '4.1(b)
(Page 8): To obtain coverage for
the participant=s dependent child, a participant is required to make
a contribution in such amount as the plan administrator, in consultation with the Faculty and Staff
as provided in Article 1.13, determines from time to time. Periodically (that is, at intervals no
greater than three years), a review of MTU=s
self-insured status, including MTU=s recent cost history and comparisons with national
norms, shall be made available to the MTU community.
Article 5, ' 5.1(c) and (d) (Page 9): AThe Plan Administrator shall have the following
powers and duties: . . . (c) To decide on questions concerning the Plan and
the eligibility of any Employee to
participate in or receive Benefits under the Plan, in accordance with the
provisions of the Plan; (d) To determine the amount of Benefits which
shall be payable to or on behalf of any person or the eligibility of any
person for Benefits, in accordance with the provisions of the Plan . . .@
Article 7, '7.1(a)
(Page 13): AThe Benefits available under the Plan are not vested
benefits and by electing to participate in the Plan no Employee attains any
right to benefits beyond the expiration or modification of the Plan, as
determined by the Employer in its sole discretion.@
Article 7, '7.1(b)
(Page 13): AThe Employer reserves the right to modify, amend, or
replace the Plan without notice at any time in whole or in part. Amendment may
be made retroactively . . .to conform with governmental regulations . . .or for
any other reason . . .@
Article 8, '8.8
(Page 15): AThe actual terms and conditions of the Benefits
offered under this Plan are contained in the Benefit Documents (appended),
and those documents shall govern in the event of a conflict with this Plan as
to substantive content. To that end,
each such separate Benefit Document as listed in the Supplement, as amended
or subsequently replaced, is hereby incorporated by reference as if fully
recited herein. is appended.
Documents will be added or amended only after full consultation with
Faculty and Staff as provided in Article 1.13.
(2) Response to petitions and
requests.
Article 6, '6.1
(Page 11): AIf notice of the denial of a claim is not furnished
in accordance with this section, the claim shall be deemed denied . .
Proposed Change: delete such that Article 6 begins AThe
claimant shall be permitted . . .@
Article 6, '6.3
(Page 11): A . . .the claimant . . .may review pertinent
documents all documents he/she deems pertinent, by arbitration in the
event of University
objections.
. .@
Article 6, '6.4
(Page 12): AIf notice of the decision on the review is not
furnished in accordance with this section, the claim shall be deemed denied@
(3). expulsion for nonpayment.
Article 2, '2.3: A . . . Once a participant=s . . .coverage . . . has terminated for any reason,
it will not be recommenced. it will be recommenced only upon
determination by the Retiree Health Insurance Appeal Committee that termination
occurred for reasons beyond the control of the participant. The Retiree Health Insurance Appeal Committee
shall be constituted so that retirees or their chosen representatives shall be
in the majority.@
NOTE: [At its November 21, 1997 meeting, the Board of
Control changed Ait will not be recommenced@ as indicated in the 1st sentence above.] Proposed further addition: Athe Retiree Health Insurance Appeal Committee shall
be constituted so that retirees or their chosen representatives shall be in the
majority.@
Article 4, '4.2,
last sentence (Page 8): AFailure to make such contributions in full as
required within 60 days will result in the termination of participation in this
Plan.@
NOTE:
Delete in conformance with the Board of Control=s
revision of '2.3
Article 8, '8.3
(Page 14): AIf any person entitled to Benefits under the Plan
becomes bankrupt or attempts to anticipate, alienate, sell, transfer, assign,
pledge, encumber or charge any Benefit under the plan, or if any attempt is made
to subject any such Benefit to the debts, contracts, liabilities, engagements,
or torts of the person entitled to any such Benefit, except as specifically
provided in the Plan, then such Benefit shall cease and terminate at the
discretion of the plan Administrator. Bankrupts who become such through
circumstances beyond their control or through expensive experimental medical
treatment shall have 6 months to make arrangements to pay any contributions
which are in arrears and are to be reinstated in the Plan, at the discretion of
the Retiree Health Insurance Appeal Committee, as soon as they are no longer in
arrears. If they fail to do so, benefits
will pass to their beneficiaries. He
or she The Retiree Health Insurance Appeal Committee may shall
hold or apply the same or any part thereof for the Benefit of the
Dependent Child or beneficiary of such person, in such manner and proportion as
he or she the Retiree Health Insurance Appeal Committee may deem
proper.@
(4) Setting of Costs
Article 4, '4.1(a)
(Page 8): A. . . each participant is required to make a
contribution in such amount as the plan administrator, in consultation with
the Faculty and Staff as provided in Article 1.13, determines from time to
time, as set forth in the supplement. Periodically
(that is, at intervals no greater than three years), a review of MTU=s self-insured status, including MTU=s recent cost history and comparisons with national
norms, shall be made available to the MTU community.@
Article 4, '4.1(b)
(Page 8): ATo obtain coverage for the participants=s dependent child, a participant is required to make
a contribution in such amount as the plan administrator, in consultation
with the Faculty and Staff as provided in Article 1.13, determines from
time to time. Periodically (that is,
at intervals no greater than three years), a review of MTU=s self-insured status, including MTU=s recent cost history and comparisons with national
norms, shall be made available to the MTU community.
(5) Coverage in the Event of a
Drastic Drop in MTU Benefits Funding.
Article 3, '3.1
(Page 6): AThe employer shall not be obligated to pay such
Benefits from its general assets or otherwise.@ To protect the future of employees in the event
of financial catastrophe of the Employer or of a third-party insurance or
service Administrator, the medigap
premiums collected shall not be reduced, or disbursed except for the
purpose for which they were collected; that is, they shall not be used to
replace shortfalls, allocated to competing budget priorities, or the like.
Article 4, '4.3
(Page 8): AThe Employer=s obligations under this Plan may be funded
through contributions to a trust, or otherwise, but the Employer=s obligations under this Plan are not required to be
funded.. Nothing in this Plan shall give
an Employee any right, title or interest in or to any property of the Employer.@
Article 5, '5.3
(Page 10): ATo the extent permitted by law, neither the Plan
Administrator nor any other person shall incur any liability for any acts or
for failure to act except for their own willful misconduct or willful breach of
this Plan.@
(6) Retiree Benefits Matching those
of Working Employees
Article 1, '1.2
(Page 2): Agroup health benefits . . .equivalent . . . to the health
benefits received by full-time active employees of the Employer most
advantageous (to the retiree) of the plans offered to active, full-time
employees at the time of the participant=sretirement
and at all times subsequently.@
Editorial & Other Changes
[Preamble], last sentence (Page [1]): AThe Plan has been amended and restated effective
July 1, 1997. effective <July 1, 1999>. This revision supersedes all previous
versions.@
Article 1, '1.15
(Page 3): A>Years of Service= means as defined in the Michigan Technological
University Retirement Benefit Program.@
Article 2, '2.1
(Page 4): AEach member of faculty and staff who retires
. . .@
Article 3, '3.4
(Page 6): AMedicare shall be the primary payer of medical
benefits covered by this Plan who is eligible to receive such benefits and
shall be deemed to cover applied to charges . . .@
Article 4, '4.2
(Page 8): AParticipant=s contributions must be made no later than 30 days
after receipt of each billing statement for each month=s coverage.@
Article 4, '4.2
(Page 8): AThe amount and timeliness of payments will be
determined by the plan Administrator in a uniform manner.@
Article 5, '
5.1, lines 4-5 (Page 9): AThe Plan Administrator shall have the exclusive
right and the full discretion to interpret the Plan and to decide all matters arising
hereunder, including the right to remedy possible ambiguities, inconsistencies,
or omissions. All determinations of the
Plan Administrator or the Employer with respect to any matter hereunder ,
in full consultation with the Faculty and Staff as provided in Article 1.13,
shall interpret the Plan, shall decide all matters arising in it, and remedy
ambiguities, inconsistencies, and omissions.
All determinations of the Plan so made with respect to any matter in the
Plan shall be conclusive and binding on all persons.@
[signature
block] (Page 15): AMichigan Technological University has executed this
amended and restated Plan . . .@
Tabled by the University Senate