On October 30, 2009 the UTU International announced on its website a national group voluntary short-term disability (VSTD) plan for all rail members they have secured from Anthem Life Insurance Company. Specifics of the plan will be mailed out to each individual member before the end of the year. In a nutshell the plan pays up to $346 per week (approximately $1500 per month) for up to 52 weeks, and provides 24/7 coverage for accidents and illness; all for the price of $31 per month. In order to guarantee initial coverage regardless of health conditions UTU members will automatically be enrolled in this disability insurance coverage effective February 1, 2010 (for CSX members) unless they waive coverage by returning the “opt out” postcard included with their mailing to the International. These “opt out” elections can be made at any time, but will only become effective when received by the International. Consequently members wishing to waive coverage at the outset of the plan should return their “opt out” postcard as soon as possible, but in no event beyond December 11, 2009, in order to avoid ever incurring the $31 per month premium assessment for disability insurance. It should also be noted that once a member opts out of coverage, he/she will be required to pass a full underwriting inspection (at their own expense) to re-apply for these group benefits should they change their mind in the future.
The purpose of this article is to notify UTU members working under the B&O Collective Bargaining Agreement (CBA) they have other, Carrier paid, supplemental sickness benefits they need to take into consideration when making their decision whether to retain the Anthem VSTD policy because these Carrier provided benefits will decrease the net benefit our members will enjoy from their $31 per month investment in the Anthem policy. Some will find the Anthem policy is a benefit anyway and will retain it, while others will decide the return is not sufficient to justify the $31 monthly payment. That is a matter of personal preference. This information is not provided to encourage a member to opt out of the Anthem VSTD policy, nor is it intended to encourage members to retain the plan. The information is merely being provided as a service for our members to help them make an informed and intelligent decision as to whether the Anthem Voluntary Short Term Disability (VSTD) policy makes sense for them.
The Anthem VSTD policy pays up to $346 per week (tax free) for up to 52 weeks (after a 30 day elimination period) of injury or illness occurring either on or off the job. Individual employee-paid disability policies, such as those purchased through UTUIA, do not offset against the VSTD plan. The maximum payment a member can receive from all Carrier paid disability plans and this policy is $693 per week or 67% of the employee’s base pay, whichever is less. Therefore this benefit may be offset by disability benefits received from outside sources paid for by the Railroad. This would include Railroad Retirement Sickness Benefits and Provident Disability Benefits our members currently receive flowing from Rule 100, Section 15 of the B&O Schedule Agreement; both of which would offset against the $693 (or 67%) per week maximum benefit.
Currently U.S. Railroad Retirement Sickness Benefits pay $64 per day; $320 per week; $1392.00 per month (21.75 work days) for the initial 26 weeks, with extended benefits of up to 13 weeks for employees with 10+ years of service. Provident Supplemental Sickness Benefits flowing from Rule 100, Section 15, of the B&O Schedule Agreement, which pay for one year the same as the VSTD plan, currently pay $1881.03 per month less the amount of RRB Sickness benefits received during the month (approximately $1392.00); leaving a net benefit of an additional $489.03 per month. This Provident benefit currently increases to a maximum of $1273.87 in months 7 through 12 of an employee’s covered illness/injury after Railroad Retirement Sickness Benefits expire; and the overall maximum benefit of $1881.03 will increase 2% annually each June 1st by Agreement.
The brief analysis of the Anthem policy illustrates that the maximum payout a B&O trainman can collect is $693 per week, or approximately $3003 per month, from a combination of Anthem, RRB Sickness Benefits and the Provident Supplemental Sickness Plan; and the Anthem portion of that payment cannot exceed $346 per week (approximately $1499.34 per month). Therefore, by our calculations, trainmen governed by the B&O Schedule Agreement, and thereby eligible to collect Provident Supplemental Sickness benefits pursuant to Rule 100, Section 15, would net approximately $1121.97 monthly ($258.92 weekly) from the Anthem policy before they reached their monthly $3003 cap during the portion of their illness/injury while they are eligible to collect RRB Sickness Benefits.
In the link
here you will find an apples-to-apples comparison, calculated to the best of our knowledge, showing a breakdown of potential monthly benefits (approximate) both with the Anthem VSTD policy, and without the Anthem VSTD policy. The crux of this spreadsheet illustrates
trainmen opting to retain the Anthem Voluntary Short Term Disability (VSTD) policy can expect to receive approximately $1121.97 monthly in non-taxable benefits for their $31 monthly premium payment over and above what they would normally receive from their Railroad Retirement Board Sickness Benefits and the Provident Life and Accidental Insurance Company under our current Supplemental Sickness Policy Agreement paid for by the Carrier. After their Railroad Retirement Board Sickness Benefits run out, they would collect the full monthly benefits from Anthem policy (approximately $1500). If members feel these benefits warrant the monthly premium, by all means they should retain the Anthem policy by doing nothing. The Anthem premiums will automatically be deducted from their paycheck each month. If they do not feel the additional potential supplemental sickness benefits warrant the $31 monthly premium they can waive coverage at any time by returning the “opt out” card to the UTU International.
If they want to avoid any premiums whatsoever, however, their “opt out” card must be received by the International on or before December 11, 2009. Once again members opting out need to understand they can only re-enter the plan by passing a full underwriting inspection (at their own expense). The choice belongs to each member individually.
I hope this information will assist our members in making an intelligent and well informed decision on whether to accept the Anthem Voluntary Short Term Disability policy or opt out. More specific benefits of the Anthem plan are outlined in the mailing each member will receive from the UTU International; but I felt it important to point out to our members the Provident Benefits they already receive because those benefits will offset to some extent (by approximately $377, while they are still receiving RRB benefits only) the monthly insurance payout they stand for under the Anthem VSTD plan as outlined above.
