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HomeMy WebLinkAbout00-046 - MSA VEBA - Voluntary Employees Beneficiary Public Employees Medical Expense Plan/ilict)- -Wo VOLUNTARY EMPLOYEES' BENEFICIARY ASSOCIATION MEDICAL EXPENSE PLAN FOR PUBLIC EMPLOYEES IN THE NORTHWEST AS AMENDED AND RESTATED NOVEMBER 19, 1999 Article I. Name, Documents & Definitions 1.1 Name. The name of this Plan is the VOLUNTARY EMPLOYEES' BENEFICIARY ASSOCIATION MEDICAL EXPENSE PLAN (Employer) ('Plan"). It is offered by a Voluntary Employees' Beneficiary Association under Internal Revenue Code § 501(c)(9). 1.2 Plan Documents. This Plan, together with the Trust and the individual Membership Enrollment Form, shall constitute the Plan Documents. This Plan document is hereby amended and restated and replaces the prior Plan document in its entirety. 1.3 Definitions. 1.3.1 "Administrator" means an Administrator appointed or contracted by the Trustees from time to time to administer all or a portion of the Plan. 1.3.2 "Dependent" means the Employee's spouse; a minor child residing with the Participant; a child of the Participant who is a student (within the meaning of IRC § 151(e)(4)); and any other person who is a dependent of the Participant within the meaning of IRC § 152(a). 1.3.3 "Effective Date' means the date an eligible employer adopts the Plan. 1.3.4 "Employee" means any current or former employee of the Employer, as defined by Treasury Regulation § 1.501(c)(9) -2(b), except employees excluded as a result of collective bargaining agreements, agreements substantially similar to collective bargaining agreements, or as a result of an individual Employers' nondiscriminatory employee benefits policies. 1.3.5 "Employer" means a county, city, or town, or special district, or similar entity in Washington, Oregon, and Idaho, whose purpose is to provide public services to its citizens, and is authorized to do so by state statute, or a Trust service provider. 1.3.6 "Fiduciaries" under this Plan are the Trustees and the Administrator. 1.3.7 "IRC" means the Internal Revenue Code of 1986, as amended from time to time. Plan Document/MSA VEBA - 1 November 19, 1999 • . 1.3.8 "Investment Account" means any investment account established by the Trustees to fund benefits. The Trustees' power to invest funds is described in the Trust. 1.3.9 "Medical Benefits" refers to payments or reimbursements for health benefits as described in Section 5.1. 1.3.10 "Membership Enrollment Form" means the form provided by the Trustees that must be completed by the Employee in order to participate in this Plan. 1.3.11 "Participant" means a Employee for whom deposits have been received by the Trust. 1.3.12 "Participant's Account" refers to the account maintained for a Participant to record his/her share of the deposits of the Employer and adjustments relating thereto. 1.3.13 'Plan Year" is from October 1 to September 30, except the first year for this Plan with an effective date other than October 1 shall run from such effective date until the next September 30. 1.3.14 "Retirement Age" shall be the same as the retirement age specified by the Employer, and as amended from time to time. 1.3.15 "Severance" means a Participant's voluntary or involuntary termination of Service for any reason other than retirement, death or disability. 1.3.16 "Trust or Trust Agreement" refers to the Trust which the Trustees adopted October 21, 1999, as an amended and restated document, together with all subsequent amendments and restatements thereto. 1.3.17 "Trustees" refers to the individuals serving as Trustees in accordance with the Trust. Article II. Participation 2.1 In General. Subject to the limitations of Section 2.2, and subject to the eligibility provisions of applicable local and State law, an Employee becomes a Participant under this Plan at the time of the first Employer deposit to this Plan on behalf of the Employee, and proper completion of a Membership Enrollment Fonn. 2.2 Limitations. This Plan does not permit any condition for eligibility or benefits which would discriminate in favor of any class of Participants to the extent such discrimination is prohibited by applicable law. 2.3 Duration of Participation. Once an Employee becomes a Participant in the Plan, his/her participation shall continue as long as funds remain in his/her Participant's Account. Plan Document/MSA VEBA - 2 November 19, 1999 • • Article III. Funding of Benefits 3.1 Contributions. Each individual Employer shall contribute to this Plan on behalf of participating Employees on terms pursuant to each Participating Employer's sick leave conversion program, flat rate contribution program, or any other Employer sponsored program permitting contributions to this Plan and Trust. Employer contributions shall be specifically allocated to each Participant's Individual Account for the purpose of providing for payment of the benefits described hereinafter. An Employer's liability for payment of benefits provided in this Plan shall be limited to the amount of its Employer contributions. Article IV. Allocation to Participant's Accounts 4.1 Participant's Account. A separate account shall be maintained by the Trustees for each Participant, and the income, losses, appreciation, depreciation and withdrawals for expenses or benefit payments attributable to his/her account. The Trustees shall not be required to maintain separate investments for any account. 4.2 the Trustees. Receipt of Deposits. Deposits for any Plan Year will be credited as received by 4.3 Accounting Steps. As of each calendar month, the Administrator shall: 4.3.1 FIRST, charge to each Participant's Account all fees, payments or distributions made under this Plan to or for the benefit of the Participant or his beneficiary that have not been charged previously; 4.3.2 SECOND, adjust each Participant's Account upward or downward, by an amount equal to the net income or loss accrued under this Plan by the Account; and 4.3.3 THIRD, allocate and credit any Employer deposit to this Plan that is made during the month to a Participant's Account. Article V. Medical Benefits 5.1 Description. Medical Benefits must be payments or reimbursement for health benefits as defined by IRC §213 and excludable from income under IRC § 105 and 106, as amended from time to time. Reimbursements for health benefits are limited to health benefits not provided by Social Security, Medicare, or any other medical and health insurance contracts held by the Participants, their Dependents, or the Employer, and the reimbursements may not be made for items paid by any other insurance contract or for expenses that are deducted by the Participant under any other section of the Internal Revenue Code. 5.1.1 Commencement of Benefits. Medical Benefits commence for expenses incurred on or after the date the Administrator receives a deposit on behalf of a Participant. Plan Document/MSA VEBA - 3 November 19, 1999 • • 5.1.2 Expenses. Medical Benefits are payable for expenses incurred by the Participant or the Participant's Dependents. 5.1.3 Payment of Benefits. Insurance premium payments may be paid by the Administrator directly to insurance companies, health maintenance organizations or preferred provider organizations or to the Employer for COBRA benefits, or may be reimbursed directly to the Participant. Payments for Medical Benefits may be made directly to the service provider, or reimbursed to the Participant. Reimbursements Shall be made in accordance with rules and regulations established by the Administrator from time to time. 5.1.4 Termination of Benefits. All Medical Benefits will terminate when the Participant's Account has no funds remaining. Notwithstanding the above, after the death of the Participant's last Dependent, any funds then remaining in the Participant's Account shall be used for Medical Benefits for the Participant's heir(s). 5.1.5 Funding Limitations. Deposits made on behalf of each Participant for Medical Benefits provided by this Plan shall not exceed the amount anticipated to be necessary to provide current supplemental medical benefits and post-retirement Medical Benefits for the Participant and the Participant's Dependents. Article VI. General Provisions 6.1 Source of Benefits. The Plan, the Employer, the Trustees' and the Trust's liability to any Participant or Dependent for Medical Benefits under the Plan shall be limited to the balance in such Participant's Account. The employer shall not be responsible for any Medical Benefits under the Plan. 6.2 Mechanics of Payment. The Participant shall, with respect to any Medical Benefit, direct the Trustee: 6.2.1 To pay Medical Benefits directly to an insurance company for qualified insurance premiums; or 6.2.2 To pay Medical Benefits to the Employer for qualified COBRA premium payments; or 6.2.3 To pay Medical Benefits to the Participant for reimbursement of qualified medical expenses and/or premiums; or 6.2.4 Any combination of 6.2.1, 6.2.2, or 6.2.3. 6.3 Claims Procedure. After the Trustees receive a deposit from the Employer on behalf of a Participant, and the Participant, or his Dependent, believes he/she is entitled to receive Medical Benefits under the Plan, such Participant or his/her Dependents (referred to in this Section as the "claimant") may deliver a request for such benefit in writing to the Administrator. The Administrator shall review the claimant's request for a Plan benefit and shall thereafter notify the claimant of its decision as follows: Plan Document/MSA VEBA - 4 November 19, 1999 • • 6.3.1 It is the Employer's expectation that claims normally will be processed within 3 business days after receipt of a completed claim form. 6.3.2 If the claimant's request for Medical Benefits is approved by the Administrator, it shall notify the claimant of such approval and proceed with the distribution of such Medical Benefits to the claimant. 6.3.3 In the event of a questionable claim or dispute, the Administrator shall within fifteen (15) days from the date the claimant's request for Plan Benefits was received by the Administrator, unless special circumstances require an extension of time for reviewing said claim, provide the claimant with written notice of its decision. In the event special circumstances require an extension of time for reviewing the claimant's request for Medical Benefits, the Administrator shall, prior to the expiration of the initial 15 day period referred to above, provide the claimant with written notice of the extension and of the special circumstances which required such extension and of the date by which the Administrator expects to render its decision. In no event hall such extension exceed a period of sixty (60) days from the date of the expiration of the initial period. 6.3.4 If the claimant's request for Medical Benefits is denied, in whole or in part, by the Administrator, the Administrator shall notify the claimant of such denial and shall include in such notice, set forth in a manner calculated to be understood by the claimant, the following: 6.3.4.1 The specific reason or reasons for the denial; 6.3.4.2 Specific reference to pertinent Plan provisions or IRS rules and regulations on which the denial is based; 6.3.4.3 A description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and 6.3.4.4 Appropriate information as to the steps to be taken if the claimant wishes to submit his claim for review pursuant to paragraph 6.3.6 below. 6.3.5 In the event written notice of a denial of a request for Medical Benefits is not provided the claimant in the manner set forth in paragraph 6.3.4, the request shall be deemed denied as of the date on which the Administialor's time period for rendering its decision expires. 6.3.6 Any claimant whose request for Medical Benefits has been denied, in whole or in part, or such claimant's authorized representative, may appeal said denial of Plan benefits by submitting to the Administrator a written request for a review of such denied claim. Any such request for review must be delivered to the Administrator no later than sixty (60) days from the date the claimant received written notification of the Administrator's initial denial of the claimant's request for Medical Benefits or from the date the claim was deemed denied, unless the Administrator, upon the written application of the claimant or his authorized representative, shall in its discretion agree in writing to an extension of said period. Plan Document/MSA VEBA - 5 November 19, 1999 • • 6.3.7 During the period prescribed in paragraph 6.3.6 for filing a request for review of a denied claim, the Administrator shall permit the claimant to review pertinent documents and submit written issues and comments concerning the claimant's request for Medical Benefits. 6.3.8 Upon receiving a request by a claimant, or his authorized representative, for a review of a denied claim, the Administi4or shall deliver the complete file to the Trustees, who shall consider such request promptly and shall advise the claimant of their decision within sixty (60) days from the date on which said request for review was received by the Administrator, unless special circumstances require an extension of time for reviewing said denied claim. In the event special circumstances require an extension of time for reviewing said denied claim, the Administrator shall, prior to the expiration of the initial 60 -day period referred to above, provide the claimant with written notice of the extension and of the special circumstances which require such extension and of the date by which the Trustees expect to render their decision. In no event shall such extension exceed a period of one hundred twenty (120) days from the date on which the claimant's request for review was received by the Administrator. The Trustees' decision shall be furnished to the claimant and shall: 6.3.8.1 claimant; Be written in a manner calculated to be understood by the 6.3.8.2 Include specific reasons for their decision; and 6.3.8.3 Include specific references to the pertinent Plan provisions on which the decision is based. 6.3.9 The Trustees may, in their discretion, determine that a hearing is required in order to properly consider the claimant's request for review of a denied claim. In the event the Trustees determine that such hearing is required, such determination shall, in and of itself, constitute special circumstances permitting an extension of time in which to consider the claimant's request for review. 6.3.10 The claims procedures set forth in this Article 6 shall be strictly adhered to by each Participant or Dependent under this Plan, and no judicial or arbitration proceedings with respect to any claim for Plan benefits hereunder shall be commenced by any such Participant or Dependent until the proceedings set forth herein have been exhausted in full. Article VII. Administrator 7.1 Rights & Duties. The Trustees shall enforce this Plan in accordance with its terms and shall be charged with its general administration. The Trustees may delegate administrative duties to the Adminisual.or. The Administrator shall exercise all of its discretion in a uniform, nondiscriminatory manner and shall have all necessary power to accomplish those purposes, including but not limited to the power. Plan Document/MSA VEBA - 6 November 19, 1999 • • 7.1.1 To determine all questions relating to the eligibility of Employees to participate. 7.1.2 To compute and certify to the Trustees the amount and kind of benefits payable to the Participants and their Dependents. 7.1.3 To maintain all the necessary records for the administration of this Plan other than those maintained by the Trustees. 7.1.4 To prepare and file or distribute all reports and notices required by law. 7.1.5 To authorize all the disbursements by the Trustees from the Trust. 7.1.6 To direct the investments to be made by the Trustees in a manner consistent with the objectives of the Plan and authorized by the Trust. 7.1.7 To make and publish such rules for the regulation of this Plan that are not inconsistent with the terms hereof. 7.1.8 If an Administialor has been named, it shall assume and perform each and every duty and responsibility delegated to it by the Trustees. 7.2 Information. To enable the Administrator to perform its functions, the Employer shall supply it with full and timely information on all matters relating to Employer deposits on behalf of a Participant. The Administrator shall maintain such information and advise the Trustees of such other information as may be pertinent to the Trustees' administration of the Trust. 7.2.1 The Trust shall forward to each Participant information necessary to use the Participant's Account and receive reimbursement of Medical Benefits. The information will include a summary ofthe Plan, including claim procedures and forms. 7.2.2 The Trust shall also mail a written acknowledgement to the Participant within a reasonable amount of time after receipt of the deposit, acknowledging establishment of the Participant's Account; confirmation of the amount received, a description of the Plan and information on filing claims with copies of the necessary forms, and a toll-free contact telephone number for error corrections or questions. 7.2.3 The Trust shall provide a written statement prepared upon the Participant's request, at least semi-annually in January and July for each Participant, which shall include the following information: Participant's name and address; social security number; contributions; total Account value at statement date; interest earned or other shared gain or loss; payout and disbursement activities, ending/forward balance; toll- free contact telephone number for error corrections or questions on reading the statement. 7.3 Compensation & Expenses. All expenses of administering the Plan shall be paid by reasonable reductions of investment earnings and/or assessments from the Participant's Accounts, allocated in a nondiscriminatory manner along similarly situated employees, as determined by the Trustees from time to time. The Employer shall not be responsible for any such expenses. Plan Document/MSA VEBA - 7 November 19, 1999 • • 7.4 Consultants, Advisors & Managers. The Trustees may employ such consultants, advisors, and investment managers as it reasonably deems necessary or useful in carrying out its duties hereunder, all of' which shall be considered expenses of administering the Plan. 7.5 Liability Limitation. The Employer and the Administrator shall not be liable for the acts or omissions to act of any investment manager appointed to manage the assets of the Plan and Trust. The Trustees shall not be liable for the acts or omissions to act of any investment manager appointed to manage the assets of the Plan and Trust if the Trustee in appointing such manager acted with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person would use in the conduct of an enterprise of a lke character and with like aims. 7.6 Notices & Directions. The address for delivery of all communications shall be, for the Employer, the principal office of the Employer marked to the attention of the Personnel Director of the Employer (or other person designated by the employer), for the Administidtor, the address certified by it for such purpose, and for the Trustees, the address certified by it for such purpose. 7.7 Funding Policy & Procedures. The Trustees shall formulate policies, practices, and procedures to carry out the funding of the Plan, which shall be consistent with the Plan objectives and the provisions of applicable law. Article VIII. Amendment & Termination 8.1 Permanency. It is the expectation of the Employer that this Plan, and the payment of deposits hereunder, will be continued indefinitely, but continuance of this Plan is not assumed as a contractual obligation of the Employer. This Plan may be amended or terminated only as provided in this Article. 8.2 Exclusive Benefit Rule. It shall be impossible for any part of the deposits under this Plan to be used for, or diverted to, purposes other than the exclusive benefit of the Participants or their Dependents. 8.3 Amendments. 8.3.1 The Trustees shall have the right to amend this Plan from time to time, and to amend or cancel any such amendments in accordance with Article lII of the Trust. 8.3.2 Such amendments shall be as set forth in an instrument in writing executed by the amending party. Any amendment may be current, retroactive, or prospective, in each case as provided herein and provided, however, that such amendment must comply with Article III of the Trust Agreement. 8.4 Discontinuance of Contributions. The Employer shall have the right to discontinue contributions without prior notice by delivering written notice of termination to the Trustees. Plan Document/MSA VEBA - 8 November 19, 1999 • 8.5 Termination of Plan. The Employer shall have the right to terminate this Plan without prior notice by delivering written notice of termination to the Trustees. In case of termination, the Employer shall also notify the Trustees of the Employer's decision with regard to disposition of the assets, based on the following options: a. A direct in-kind transfer of assets to a substantially similar 501(c)(9) trust; b. A series of installment payments over a set period of the assets from the Trust attributable to this Plan to another 501(c )(9) trust; or c. An immediate cash payment to another 501(c)(9) trust or another program providing medical benefits for the Participants of this Plan and their Dependents, subject to any contractual adjustments due upon such a transfer. In any event, the Employer and the Trustees shall work to prevent adverse consequences to other Employers contributing to and Participants in the Trust as a result of the Employer's decision with respect to these options. The Terminating Employer agrees to pay the Trust all reasonable costs resulting from the disposition and transfer of the assets that are not covered by the Participants' Account. Article IX. Miscellaneous 9.1 The Trust. This Plan, the Trust, and the Membership Enrollment Form are all parts of a single, integrated employee benefit system and shall be construed together. In the event of any conflict between the terms of this Plan and the Membership Enrollment Form and the terms of the Trust, such conflict shall be resolved first by reference to the Trust, except as more specifically addressed in the Plan, then the Plan, then the Membership Enrollment Form. 9.2 Applicable Law. Except as required in § 514 of the Employee Retirement Income Security Act of 1974 ("ERISA"), this Plan shall be construed, administered, and governed under the laws of the State of Washington. If any provision of this Plan shall be invalid or unenforceable, the remaining provisions hereof shall contmue to be fully effective. 9.3 Gender & Number. Words used in the masculine shall apply to the feminine where applicable, and when the context requires, the plural shall be read as the singular and singular as the plural. 9.4 Headings. Headings used in this Plan are inserted for convenience of reference only, and any conflict between such headings and the text shall be resolved in favor of the text. 9.5 Unclaimed Accounts. In the event any benefit held hereunder shall have been payable and unclaimed for a period of at least five (5) years since the whereabouts or continued existence of the person entitled thereto was last lmown to the Administrator, said benefit may be forfeited and liquidated and the Trustees may use proceeds therefrom to reduce administrative charges to the Trust, otherwise the Trustees shall turn over said benefit to the State of Washington Department of Revenue Unclaimed Property Section, using forms provided by the Department of Revenue. Plan Document/MSA VEBA - 9 November 19, 1999 • • 9.6 Limitation on Rights. Neither the establishment of this Plan, nor any modification or amendment thereo nor the payment of any benefits, nor the issuance of any insurance Contracts shall be construed as giving any Participant, or any person whomsoever, any legal or equitable right against the Trustees; the State of Washington, its agencies, officers, employees, and institutions of higher education; or the Employer nor any right to the assets of the Plan. 9.7 Assignment. The interest of any Participant in any assets held on his behalf by the Trustee shall not be subject to assignment or alienation, either by voluntary or involuntary act of the Participant or by operation of law, and shall not be subject to assignment, attachment, execution, garnishment, or any other legal or equitable process. 9.8 Counterparts. This Plan may be adopted in an original and any number of counterparts, each of which shall be deemed to be an original of one and the same instrument. IN WITNESS WHEREOF, the Trustees have caused this Trust Agreement to be executed and atested by their duly authorized officers, and the Trustees have hereunto affixed - it signatures, all as of this /9725day of N� of m f,/, r , 199 9 . Attest: Attorney - H Liebman COUNTY, CITY, TOWN PUBLIC SERVICE AGENCY TRUSTEES Trustee - Ter#y Davis Trustee - Andrew OGIAL Michels SPECIAL PURPOSE DISTRICT PUBLIC SERVICE TRUSTEES Plan Document/MSA VEBA - 10 November 19, 1999 Trustee - Eric Andrews Trustee - Steve Sandelius • • A6 co -D-14 CITY OF TUKWILA Voluntary Employee Beneficiary Association (VEBA) Plan For Non -Represented Employees Effective October 1, 2000, the City of Tukwila shall participate in a Medical Savings Account/Voluntary Employee Benefit Association (MSA/VEBA), consistent with Resolution No. 1445, subject to the provisions below for all City non -represented employees and the Mayor. I. The MSA/VEBA Trust Administrator shall be REHN & Associates, Inc., of Spokane, Washington. II. All current regular full-time and part-time (at least 20 hours per week), non - represented employees and the Mayor shall be required to participate in the City of Tukwila's VEBA Plan effective October 1, 2000. Non -represented employees hired and Mayor's elected after October 1, 2000, shall be required to participate in the plan effective the first of the month following their date of hire or beginning of elected term of office. III. All non -represented employees and the Mayor shall be required to make a monthly contribution from their base wage salary (as reflected on the adopted non - represented salary schedule or the ordinance approving the Mayor's wage) into their plan account as follows: Employee's Monthly Wage Amount of Monthly Contribution Up to $4000 1% $4001 - $4500 1% $4501 - $5000 2% $5001 - $5500 2% $5501 - $6000 2% $6001 - $6500 2% $6501 - $7000 2% $7001 - $7500 3% $7501 + 3% IV. Upon an employee's voluntary quit in good standing or retirement from City employment (or when the Mayor is no longer in office), the City shall deposit into the employee's or Mayor's MSA/VEBA account, the dollar amount the employee would have been paid for his/her accumulated sick leave as contained in Section 2.51.040(2) of the Tukwila Municipal Code or as determined by resolution for the Mayor. If required ORIGINAL • and applicable, the City shall exclude from the MSA/VEBA, the sum of unused sick leave accruals used by the Department of Retirement Systems in calculating the employee's average final compensation. V. This initial plan design for the non -represented employees shall be reviewed during the first quarter of 2003, with any changes going into effect on October 1, 2003. Thereafter, the plan design shall be reviewed as needed, but not more frequently than every three years. DATES this % 7 day of OF TUKWILA Steven M. Mullet, Mayor , 2000.