[Adopted 12-4-2007 by Ord. No. 2007-19]
[1]
Editor's Note: Former Art. II, Health Benefit Coverage, adopted 6-3-1991 as Ord. No. 1991-9, was repealed 3-1-1993 by Ord. No. 1993-4. Said ordinance provided that it be implemented and effective retroactive to its first reading and that any retired employee currently receiving benefits under the repealed ordinance shall continue to receive such benefits.
The Township of Lumberton currently provides certain health benefits to permanent full-time employees in accordance with Chapter 46 of the Code of the Township of Lumberton. Since the cost of health benefits has continued to rise at a greater rate than inflation, the Township of Lumberton has incurred large expenses in attempting to meet these costs. In addition, certain employees of the municipality are eligible for coverage through their spouses, resulting in some employees having double coverage which is underutilized based upon the cost incurred. This article would permit certain employees to participate in a buyback program which would allow those employees to voluntarily select the health benefits that best suit their individual needs. In addition, by voluntarily declining certain or all of the health benefits accorded that employee by the municipality, he or she will be eligible for additional compensation due to the cost savings which the municipality and its taxpayers incur.
A. 
Employees receiving benefits in accordance with this chapter shall be entitled to all health benefits set forth above at no cost. Employees, at their sole option, may participate in a buyback system as set forth herein.
B. 
Employees who are entitled to family coverage may amend their coverage as follows:
(1) 
Decline all coverage;
(2) 
Reduce from family coverage to single coverage;
(3) 
Decline medical benefits only (employee must provide documentation demonstrating coverage elsewhere);
(4) 
Decline dental coverage only;
(5) 
Decline prescription coverage only;
(6) 
Decline any combination of coverage types listed above.
C. 
An employee who is entitled to single coverage may amend his or her coverage as follows:
(1) 
Decline all coverage;
(2) 
Decline medical benefits only (employee must provide documentation demonstrating coverage elsewhere);
(3) 
Decline dental coverage only;
(4) 
Decline prescription coverage only;
(5) 
Decline any combination of coverage types listed above.
D. 
Any participant who declines medical (hospitalization) coverage must provide written documentation to the municipality establishing that he or she is covered elsewhere. No employee will be allowed to decline this coverage without proof of other coverage.
A. 
For those employees who wish to participate in any buyback program, said employees shall receive a payment for each option declined for each quarter of the calendar year. Such quarterly payments will be made no later than the 10th day of the month following the end of the quarter, i.e., April 10, July 10, October 10, and January 10 of the following year. All payments to employees shall be for the preceding three months. All such payments in lieu of benefits are taxable under federal and state regulations (including federal wage tax, FICA, state income tax, state unemployment tax and state disability insurance). Taxes will be deducted in accordance with the employee's W-4 form on file at the time of enrollment. Payment in lieu of benefits shall have no effect on pension deductions or calculations.
B. 
Amount of payment. Any employee who declines any coverage set forth above, or any combination of coverages, resulting in a savings to the municipality for the cost of such benefits shall be entitled to be paid 50% of the savings incurred by the municipality, with a maximum payment in lieu of benefits not to exceed $5,000 in any calendar year. Such payments shall be made quarterly to said employee as set forth above. (Example: If an employee is eligible for but declines family coverage and retains only single coverage, resulting in a savings of $5,000 in health care costs to the municipality in any particular calendar year, said employee shall be entitled to 50% of such savings, payments totaling $2,500 for the year in question, i.e., $625 per quarter.)
C. 
Enrollment in program. Any employee who wishes to participate in the health benefits selection and buyback program shall do so to be effective May 1 and November 1 of each year. An employee must notify the Township, in writing, no later than the preceding April 1 or October 1 of his or her intention to participate.
D. 
Emergency enrollment. If an employee chooses to decline a certain benefit based upon spouse coverage and the spouse coverage is later eliminated or, in the case of plan change from single to family due to marriage or divorce, the employee may do so at any time during the year with a thirty-day notice to the municipality. A fifteen-day emergency enrollment, or enrollment to the first day of the following month, may be allowed under extreme hardship. The Township Committee shall determine, on a case-by-case basis, whether there exists an extreme hardship. If an employee changes his or her benefits plan, his or her quarterly payment shall be amended accordingly on a prorated basis.
E. 
Preexisting conditions. Preexisting conditions shall be covered in accordance with the benefit plan at the time of enrollment.
F. 
Carriage of deductible. Any employee who reduces his or her coverage and, subsequently thereafter during an enrollment period, adds back to the coverage, he or she will not be able to receive credit for and carry the deductibles, if any, that were met earlier in the year.
G. 
Special enrollment period for 2008. A special enrollment period for 2008 will allow employees to enroll effective October 1, 2008, for the months of October, November and December 2008. Such enrollment shall be on a prorated basis for calendar year 2008. Any payment to be made by the municipality with respect thereto shall be made by January 10, 2009.