1. WORKING WITH THE PLAN SPONSOR DISABILITY RETIREMENT WORKING WITH THE PLAN SPONSOR

2. PANELISTS ☺ Kathy Foster - ACERA ☺ Shari Altmark - LACERA ☺ Richard Schlosser - LACERA ☺ Annette Paladino - SBCERS

3. Why work with the Plan Sponsor? The Plan Sponsor is an interested party in all retirement matters. The Retirement System has a responsibility to the Plan Sponsor to keep costs down. The Retirement System and the Plan Sponsor frequently have similar interests. The Plan Sponsor needs to be well informed so as to make prudent benefit decisions.

4. System - Plan Sponsor Working Together - 3 Issues Gathering Case Facts - ACERA Return to Work - LACERA Effective Date - SBCERS

5. Disability Application Process Benefits of a Comment Paper Period SACRS Spring Conference, 2009

6. Background  Prior to drafting new procedures (effective 11/1/2006), ACERA performed a review of its disability retirement application process to resolve lengthy processing times and reduce the volume of cases going to Legal hearings.

7. Summary of Prior Procedures Member filed application with at least one medical report stating they were permanently disabled. Staff reviewed application including eligibility to apply and collected all additional evidence from treating physicians and/or workers comp. examinations. Upon completion of evidence collection by staff, packet including application and evidence went to Employer for 14-day review. After 14 day review by Employer, ACERA forwards disability packet to Medical Advisor for his review. Based on ACERA’s requirements, MA provided opinion on whether or not the member is permanently incapacitated for performance of his/her job duties. Once MA rendered an opinion, the applicant and employer had opportunity to review and either contest the opinion or agree with it. Case then went to Retirement Board for approval, or to a legal hearing if MA opinion was contested.

8. Delays in Process Most significant delays came from either the employer or from applicants requesting legal hearings. Delays by members were generally to obtain more evidence. Delays from employer were usually due to length of time needed to review case and prepare for hearing. How could we fix this? Rather than staff having to track down all the evidence and incur delays in receiving this evidence from various sources, ACERA places the burden of proof on the applicant. Applicant now must provide all evidence to build his/her case at the time they apply for disability retirement. But, ACERA was also concerned with length of time employer took to review and prepare cases for legal hearings.

9. Comment Paper Period Employer decided that in many cases medical evidence was not thorough. More medical examinations or reports were required to prepare for hearing. Gathering this evidence took time and delayed the scheduling of hearings. ACERA determined it would be more efficient for the employer to review the file prior to submitting the case to the Medical Advisor. This allows the employer to determine the following: Possible pre-existing injuries not reported by the applicant Possible workers comp records to add to evidence Possible employment issues not communicated by applicant Whether or not to send applicant to IME (if evidence is insufficient for them to move forward) Possible accommodation available Employer is given 30 days to review the application and the evidence submitted by the applicant.

10. Comment Paper Period The applicant has the same opportunity as the employer to review the packet for all information they feel is necessary to prove their case. Both applicant and employer may call attention to certain areas of the packet they feel are very relevant or should be discounted for certain reasons. Comments provided by either party are shared with the opposite party prior to the packet being submitted to the Medical Advisor.

11. Benefits of a Comment Paper Period Employer issues with applications are identified and addressed up front. Additional information is provided prior to Medical Advisor review and prevents legal hearings due to complete evidence review. Both parties have opportunity to respond to the other party regarding comments. Medical Advisor has complete records on which to base decision. Processing time is decreased. Volume of cases decreased from 200 in 2004 to 40 in 2009.

12. LACERA WORKING WITH THE PLAN SPONSOR RTW COORDINATOR

13. FIRST STEPS Working with the RTW Coordinator FIRST STEPS 1.LACERA staff gets medical opinion to clarify: ♦ permanent work restrictions ♦ ability to performed modified work. 2.LACERA staff meets with the RTW Coordinator to discuss department’s ability to accommodate work restrictions.

14. Meeting with the RTW Coordinator ♦ First, make sure each party understands the permanent work restrictions. ♦ Identify those work restrictions that exceed the current physical demands of the job. ♦ Discuss how problem work restrictions may be accommodated.

15. Explain to the RTW Coordinator Permanent Accommodation Categories 1.Within applicant’s pre-injury job class Precludes Disability Retirement Precludes Disability Retirement 2.In a new job class pursuant to §31725.5,.6 and.65 Assumes Disability Retirement Assumes Disability Retirement

16. Meeting with the RTW Coordinator DISCUSS WAYS TO ACCOMMODATE 1.Work site modifications Ergonomic furniture Voice activated software Lifting devices, etc 2.Redistributing duties Swap problem duties with co-workers 3.Modifying duties Provide assistive devices Provide assistance 4.Change work location Telecommute Report to different supervisor 5.Change work schedule

17. OBSTACLES  Explaining the law  Identifying pertinent work restrictions  Delay in written offer of accommodation from the County  Explaining changes in Board Policy  Turnover within the RTW Division

18. WORKING WITH THE PLAN SPONSOR EFFECTIVE DATE GUIDELINES

19. How the Plan Sponsor became interested in Effective Date 1. In 2006, the County began evaluating the effectiveness of their procedures for handling Workers’ Compensation claims. 2. The County saw the success of their process in some ways as being connected to the Disability Retirement process. 3. The County proposed a joint meeting to discuss how the processes affect each other.

20. ALSO…. 4. The County was interested in lowering retirement system costs, including the cost of the disability program 5. The County admitted it wanted more input into retirement issues, including disability issues: ♦ Length of the process ♦ Use of 3 IME’s ♦ Effective date of disability benefits

21. Joint Process Improvement Project January 2006 Participants: County Counsel, SBCERS Counsel, Disability Manager, Risk Management Project Goals: Develop a better working relationship Share information on disability/WC issues Achieve consistent resolution of disability and work comp claims Develop a mutually acceptable disability effective date policy that avoids double dipping

22. SBCERS §31724 Interpretation Prior to 2004 Last day of Reg. Comp: last pay from which contributions are taken Paid little attention to Labor Code Div. 4 benefits 2004 “Compressed” paid hours after leaving work Last day of Reg. Comp: 2 definitions 1.Last day worked (to see if applicant is entitled to early app date) 2.Compression date (to determine when benefits would begin) Labor Code Div. 4 benefits: limited to 4850 2006 Last reg. comp: last day worked “Compressed” paid hours after leaving work to determine begin date Labor Code Div. 4 benefits: limited to 4850

23. JOINT PROJECT MEETINGS Effective Date Policy Areas of Disagreement: Definition of Regular Compensation Extent of Labor Code Div. 4 benefits Appropriateness of “compression” What constitutes undesirable “double dipping.”

24. EFFECTIVE DATE JOINT PROJECT Areas of Disagreement Regular Compensation Labor Code Div.4 benefits CompressionDouble Dipping SBCERSPay for actually working in his/her position Limited to 4850 Appropriate because it prevents double dipping Does not preclude receipt of retirement and TTD COUNTYAll pay received while on leave from work, including sick leave and vacation Includes TTD, VR and 4850 Does not prevent double dipping; does not account for cash benefit or Div. 4 benefits Does preclude receipt of retirement and TTD

25. THE STRUGGLE SBCERS and County Counsel meet several times from 2006 to 2008 to come to an agreement on an acceptable policy that would resolve the areas of disagreement. These meetings produced little agreement.

26. The Lawsuits Katosh v. SCERA Issue What is last day of reg. compensation; when do benefits start? Finding “ …the term “regular compensation” in section 31724 includes compensation received for sick leave and vacation when taken by appellant as time off.” Impact Disability retirement benefits cannot become effective prior to the end of sick/vacation pay received while off work. BUT: SBCERS did not change its compression policy & Katosh didn’t address Labor Code Div. 4 benefits

27. LAWSUIT # 2 WEILAND v. SBCERS Weiland petitioned for writ appealing the Board’s decision on her effective date, but did not move forward for 2 years. The County filed a brief arguing that: 1.Weiland’s position and SBCERS position that the benefit should be effective at the end of the “compression” of pay received after leaving work violated §31724 2.Weiland’s benefit could not begin until the expiration of all her Labor Code Div. 4 benefits including TTD and VRMA, unless she agreed to an earlier date that would require her to pay back to the County all her Workers’ Comp benefits received after the effective date. The Court agreed with the County’s arguments.

28. BACK TO THE DRAWING BOARD Joint Project participants met several more times and finally agreed upon a draft Effective Date Policy for the board’s consideration, including: Last day of reg. comp. is last day of any pay Labor Code Div. 4 includes TTD, VRMA No compression The board adopted the new effective date policy on 1/26/09