NCRGEA held our 2024 Spring Conference in Raleigh at the McKimmon Center April 1 and April 2, 2024. We enjoyed our guest presentation by current Treasurer, Dale Folwell, who also provided attendees with cards directing them to find Unclaimed Property at NC Cash.
Click the button below for his video presentation.
Wednesday, March 20, 2024 | SSA Press Release
Social Security Commissioner Martin O’Malley today announced he is taking four vital steps to immediately address overpayment issues customers and the agency have experienced. Commissioner O’Malley testified before the U.S. Senate Special Committee on Aging and the U.S. Senate Committee on Finance (excerpt):
“For 88 years, the hard-working employees of the Social Security Administration have strived to pay the right amount, to the right person, at the right time. And the agency has done this with a high degree of accuracy over a massive scale of beneficiaries. But despite our best efforts, we sometimes get it wrong and pay beneficiaries more than they are due, creating an overpayment.
When that happens, Congress requires that we make every effort to recover those overpaid benefits. But doing so without regard to the larger purpose of the program can result in grave injustices to individuals, as we see from the stories of people losing their homes or being put in dire financial straits when they suddenly see their benefits cut off to recover a decades-old overpayment, or disability beneficiaries attempting to work and finding their efforts rewarded with large overpayments. Innocent people can be badly hurt. And these injustices shock our shared sense of equity and good conscience as Americans.
We are continually improving how we serve the millions of people who depend on our programs, although we have room for improvement, as media reports last fall revealed. We have also embarked upon a deep dive into the extent of the overpayment problem at Social Security, the root causes of these administrative errors, and the steps we can take as an agency to address these individual injustices.
Our deeper understanding of the complexities of this problem has set us on the following course of action:
Implementing these policy changes — with proper education and training across the people, policies, and systems of the agency — is an important but complex shift. And we are undertaking that shift with urgency, diligence, and speed.
I look forward to working with Members to discuss ideas that could address the root causes of overpayments.”
Social Security launched a comprehensive review in October 2023 of agency overpayment policies and procedures to address payment accuracy systematically. (See Learn about Overpayments and Our Process | SSA and Press Release | Press Office | SSA). These changes are a direct result of the ongoing review. Additionally, the agency recently announced it is working to reduce wage-related improper payments by using its legal authority to establish information exchanges with payroll data providers that will significantly reduce the number of improper payments, once implemented. (See Press Release | Press Office | SSA for more information). The agency will continue examining programmatic policy and making regulatory and sub-regulatory changes to improve the overpayment process. More details on these updates will be shared as they become available.
To watch the testimony and read Commissioner O’Malley Statement for the Record, visit Keeping Our Promise to Older Adults and … | Senate Committee On Aging and Hearing | Hearings | The United States Senate Committee on Finance.
With Association members who range from the technologically savvy to those who have limited interactions with computers or mobile devices, NCRGEA has committed itself to a hybrid communication format – print and electronic – to address all member needs.
Our feedback reveals that Facebook is the social media of choice for our retired members. Consequently, if you’re on Facebook and not following the NCRGEA Facebook page, don’t miss an opportunity to stay up-to-date on news and events impacting members. Our page features breaking information, details about health benefits, special events, and more.
To make it easy, the Association has created two tutorials – one for our desktop/laptop users and another for those who prefer to use mobile devices.
Computer/Laptop Browsers
Mobile Devices
Occasionally, some computers and other devices may deliver a lower-quality video playback due to YouTube Settings. We have created this step-by-step document for your convenience on how to change that setting to achieve a better experience.
NCRGEA’s Local Outreach was back on the road in September and October, and we held seven meetings throughout the state to provide information about open enrollment. As you all know, this is a very busy and sometimes confusing time with questions about medical, dental, and vision plans. Our goal was to provide members with helpful resources they may need to navigate the process.
Our meetings included representatives from Seniors’ Health Insurance Information Program (SHIIP), Humana, and our partner, AMBA. We value these relationships and the help they provide to the retirees in our state. All who attended said they learned something beneficial and enjoyed the meetings.
Please plan to attend future events, and be on the lookout for all the ways we communicate upcoming meetings:
Our next meetings will be held in the spring of 2024 at a location near you. Check out the January edition of Living Power for dates, times, and locations, or go to our website for meeting details and how to register. You can also reach out if you have a group of state or local retirees and would like us to plan a meeting in your area. We’d be happy to arrange one!
by Paul Woolverton, Jan-April 2024 Living Power
The new law, called the Transformational Investments in NC Health, was created for UNC Health and ECU Health. UNC Health and ECU Health are the regional healthcare systems based at The University of North Carolina at Chapel Hill and East Carolina University in Greenville. Both are state agencies.
The law prohibits new employees at UNC Health and ECU Health from participating in the traditional state retirement program—a system that guarantees retired state employees an income for the rest of their lives after they retire. Instead, new employees at UNC Health and ECU Health would enroll in an investment program to save for retirement, but that program doesn’t guarantee a post-retirement lifetime income.
The Transformational Investments in NC Health law was part of the state’s 2023–2025 biennial budget, which the General Assembly approved in September. The law allocates $420 million to UNC Health and ECU Health for the NC Care initiative. The initiative is for health clinic and hospital construction and other medical services for rural areas of eastern North Carolina.
According to the office of State Senate President Pro Tem Phil Berger, some of the $420 million for NC Care is coming from the $1.6 billion “sign-on bonus” that North Carolina is getting from the federal government for expanding Medicaid health insurance to several hundred thousand uninsured lower-income North Carolinians. Funding for NC Care also comes from the State Capital and Infrastructure Fund, a fund the legislature established to pay for public infrastructure and facilities.
But State Treasurer Dale Folwell says this law threatens the stability and long-term health of the pension plan for retired state employees and future retirees. “This is a torpedo to the pension system,” he says. He believes the law also would drive up the price of providing health insurance benefits for state employees, and the costs could be transferred to the employees through their premiums or to North Carolina taxpayers.
Folwell estimated the liabilities to the pension and state health benefits systems could exceed $1.5 billion. The new law could have the collateral damage of putting increased income taxes on state employees by canceling the tax-deferred status of their retirement contributions, according to Folwell. His office oversees the state pension system and the state health plan medical insurance benefits system.
The normal pension offered to state employees is the Teachers’ and State Employees’ Retirement System. But there also is an optional retirement program for employees of the University of North Carolina System, which includes all the state universities and UNC Health and ECU Health hospital systems. While the state treasurer’s office oversees the traditional pension program, the UNC System manages the optional retirement program. Employees of those health systems may participate in either retirement program.
In the Teachers’ and State Employees’ Retirement System, employees put in 6% of their salaries (and this money is tax-deferred, so it reduces the employee’s taxable income). The employing agency also contributes. The treasurer’s office invests the money, and when the employee retires, he or she will get a monthly payment based on how long they worked and the average of their highest four years of salary, a state retirement document says. Approximately 85% of a retiree’s benefits from the pension are derived from their own contributions and earnings.
“More than 90% of those who make less than $40,000 a year choose the retirement plan because it provides them with the certainty that they need when they don’t have the income to be retirement-ready on their own,” Folwell says. Among university employees earning more than $100,000, 58% choose the pension plan, and 42% choose the investment plan, says Patrick Kinlaw, the director of policy, planning, and compliance for the Retirement Systems Division at the treasurer’s office.
People who would like more control of their retirement planning can use the Optional Retirement Program, according to a guide published by the UNC System. As with the normal plan, employees put in 6% of their income (tax-deferred). Employees can direct the money to various mutual funds and other investment tools.
Folwell says the optional retirement program can be more attractive to employees with higher incomes. Regardless of whether the employees choose the standard or the optional retirement program, the state already offers all of them supplemental investment options to help increase their retirement nest eggs.
According to the Retirement Systems Division at the treasurer’s office, as of December 2022 there were 298,000 state employees contributing to the Teachers’ and State Employees’ Retirement System, and 21,000 in the UNC optional retirement program.
The treasurer’s office says that if UNC Health or ECU Health produce a new retirement program that allows employees to put in an amount other than 6% of their income (for example, 4%), the Internal Revenue Service could cancel the tax break that the employees receive on their retirement contributions.
The tax break on the retirement contribution reduces the employees’ taxable income. If an employee had a $50,000 salary, the 6% contribution is $3,000 and lowers the taxable income to $47,000.
The IRS requires the retirement contributions offered to the employees to all be the same percentage, according to the treasurer’s office. If UNC Health offers existing employees both the current 6% program plus a new 4% contribution program, the IRS could revoke the tax break for everyone.
Dan Doonan of the National Institute on Retirement Security says employers in the public and private sector sometimes withdraw from their pension plans, and there are three concerns when that happens.
First, when UNC Health and ECU Health reduce their participation in the retirement system by excluding new employees, the agencies’ share of payments going into the retirement system will decline more quickly than the amount retirees drawing pensions from the plan are paid.
“What that means is, with any unfunded liabilities, there’s going to be a cost shift to the rest of the employers still in the system,” Doonan says. In this case, the other tax-funded state agencies.
Second, after the employer departs from a pension program, the risks involved in running the pension plan will be more concentrated on the remaining employers and employees. “If you have a Great Recession-type event, the employers who leave aren’t going to be there to help get things back on track,” Doonan says.
The third concern, according to Doonan, is ending up with a pension fund with more retirees and fewer workers.
“And when you look at private sector multi-employer plans that have struggled—and particularly coming out of the Great Recession—they tend to be the ones that had a lot of retirees and few workers,” he says. “Because there’s no way to get back on track if you start to get really retiree-heavy.”
When an employer or state agency exits a pension plan, it normally makes a payment to the pension plan to cover the financial liabilities it leaves behind for its employees who have been in the system.
That’s not happening with UNC Health and ECU Health, according to Folwell. “It’s a divorce where one party leaves the family and doesn’t pay the liabilities and debts they’ve left behind,” he says. Fowell estimates the health systems would have to pay more than $1 billion to make the state health plan whole, and more than $500 million to make the pension plan whole.
A study that Doonan and Tyler Bond of the National Institute on Retirement Security published in 2019 looked at what happened when pensions were shut down for state workers in several states.
When Alaska shut down its pension for state employees and teachers in 2005, it still owed pensions to workers who had already been in the system, the report found. Those costs grew into the billions. Meanwhile, after the pensions were eliminated, the state had trouble recruiting teachers, state troopers and other public employees. And people retiring without a traditional pension were more likely to suffer financial hardship.
The Alaska Beacon reported this past February that Alaska was considering reviving its pensions for state employees. It said a state study found that Alaskan government retirees relying on investment-based retirement programs were getting significantly less income than they would have if Alaska had not done away with its pensions.
Elsewhere, Michigan cut off new employees from pension eligibility in 1997. The burden on taxpayers grew to pay the retirements to the workers that had been in the system. And workers in the new, non-pension 401(k) were projected to receive only $300 per month on average, vs. $1,849 under the old pension plan, the study found.
But the two health systems say Folwell’s dire predictions for the retirement system and state health plan are wrong.
“ECU Health does not anticipate these changes will negatively impact the state of North Carolina,” ECU Health says in a statement. As of early November, details about the new retirement programs for UNC Health and ECU Health were unavailable.
In a statement to Living Power, UNC Health also defended the Transformational Investments in NC health law.
“These new benefits will mirror what other similarly sized health care systems in the state offer their employees,” says Alan Wolf, a spokesman for UNC Health. “That will allow UNC Health to better compete with the private sector on hiring and retaining employees by allowing for new retirement benefits, outside the ones normally offered by the state.”
The law also allows UNC Health to let existing employees switch to the new benefits plans, although there are no current plans to do so. “That is a new policy we could consider offering, but we are not obligated to do so,” Wolf says.
ECU Health says it “does not anticipate any impacts to existing state employees” based on its participation in the new law’s benefits programs. Of the 14,000 people at ECU Health, only 1,200 are state employees. The rest are private-sector employees operating under ECU Health and do not participate in the State Health Plan or state retirement system.
UNC Health has 30,000 people, with 13,500 state employees and 16,500 private sector employees, according to Wolf.
But NCRGEA executive director Tim O’Connell shares concern with this new law. He believes it will increase costs over time to these healthcare entities, those seeking healthcare, and even the taxpayers.
“There is some great empirical research highlighting the fact that defined benefit plans like a pension are nearly twice as efficient as defined contribution plans,” O’Connell says. “Pensions plans have distinct advantages by design with longevity pooling, portfolio diversification, and lower management fees. If these two state healthcare systems do away with the current pension and health benefits, they will either need to absorb these higher personnel costs that are then passed on to patients or reduce the employee benefits. Neither are great options.”
November 28, 2023
This Forbes article warns of the threat to the stability of the Teachers’ and State Employees’ Retirement System and State Health Plan with 2024 budget provision. The provision will make new UNC Health and East Carolina University Health employees ineligible for the state pension plan beginning January 1, 2024.
November 8, 2023
by Tim O’Connell
The decision to no longer extend State pension and health plan benefits to new employees of UNC Healthcare and ECU Health is detrimental to all North Carolinians.
NCRGEA will continue to work with elected officials to move to a more fiscally sound solution to protect the pension and health plans so as not to increase the risk of retirement insecurity among healthcare workers and their retirees, especially its lowest-paid.
It’s the holidays and time for good food and lots of desserts!
NCRGEA members are spreading a little joy and comfort during this holiday season by sharing some of their best dessert recipes with you. Just click this link for the flipbook or download a copy. Then, heat up the oven and click on the music!
Thank you to all who submitted your amazing recipes to help jumpstart the holidays and bring a little warmth into the season!!
Enjoy and Happy Holidays!
Deryl Davis Fulmer, PhD.
NCRGEA Community Liaison
In June of 2023, the State of North Carolina, including the State Health Plan for Teachers and State Employees and State Treasurer Dale Folwell, filed a Writ of Prohibition with the North Carolina Supreme Court seeking to overturn and prohibit the March 2022 Supreme Court decision on Lake v. NC State Health Plan from moving forward at the trial court level. The North Carolina Supreme Court’s March 2022 decision determined that eligible State employees have a contractually vested right in a noncontributory health plan for life, equivalent to the plan in place when a class member’s rights are vested.
On October 20, 2023, the North Carolina Supreme Court denied the Writ of Prohibition, allowing the case to continue to be adjudicated in the Gaston County, North Carolina Superior Court.
Use this link for more official NCRGEA information about the Lake Case: Lake Class Case – Gray Layton Kersh.
Press Release/ October 2023
For the first time, North Carolina’s Department of Health and Human Services is joining with the American Society on Aging to acknowledge the newly established Ageism Awareness Day on Oct. 7, 2023. Modeled after the United Nation’s International Day of Older Persons, Ageism Awareness Day provides an opportunity to draw attention to the existence and impact of ageism in our society.
NCDHHS is hosting a virtual webinar event on Oct. 5 at 10 a.m. to help bring attention to the existence and impact of ageism in our society. To learn how to reframe aging in our communities, join the virtual Zoom event online.
The most widespread and socially accepted form of prejudice, ageism is defined by the World Health Organization as “the stereotypes (how we think), prejudices (how we feel) and discrimination (how we act) towards others or oneself based on age.”
“Ageism hurts us all. Getting older is something to celebrate — we have to learn to find joy in every stage of our lives,” said Joyce Massey-Smith, Director of the NCDHHS Division of Aging and Adult Services. “Older people are one of North Carolina’s greatest natural resources, and we are one of the most age-friendly states in the country. We are committed to honoring people of all ages through initiatives such as All Ages, All Stages NC and through our collective efforts, we will continue to stand up for older North Carolinians in the face of ageism.”
North Carolina has seen significant demographic changes in the 21st century, with a national ranking of 9th in population aged 65 and older. In 2021, one in six people in North Carolina were over the age of 65. That number represents 1.8 million adults, or 17% of the total population, in North Carolina. By 2031, there will be more individuals aged 65 and older than children under 18 in the state, according to the North Carolina State Center for Health Statistics.
“We live in an aging society, which is a wonderful, remarkable thing,” says ASA’s Interim President Leanne Clark-Shirley. “But too many of us view aging with fear, denial and even hostility. We are all growing older. We can’t afford to limit ourselves and other people with such negative and harmful views, and why would we want to? Let’s lean into the opportunities, diversity and full range of experiences that come with aging.”
Evidence shows ageism is widespread in society and can be found everywhere, from our workplaces and health systems to stereotypes we see on TV, advertising and in the media:
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