USC Benefits Administration

1. USC Benefits Administration Planning for Retirement: Strategies, Options & Information “Taking pride in your peace of mind.” Transitions 2012 Presented by : Awilda P. Bregand

2. Life Insurance

3. Will I need to continue after retirement? • Start by evaluating your family's needs. • Will there be a mortgage remaining? • Will there be outstanding medical or credit cards bills? • Are there young children for whom college money must be provided? • Bear in mind that usually as retirement savings increase the need for life insurance decreases

4. What is my current available coverage? • USC currently offers group term life insurance with no residual/cash value • Basic Life Insurance – University paid • 1x your annual salary • up to a maximum of $50,000 • reduces to 65% at age 65 and 50% at age 70 • Supplemental life insurance available for employee and dependents – paid for entirely by employee • No age reduction

5. Do you really need this? • Employee is 65 elects coverage of $100,000 Preferred - 100 x 4.677 = $468 per month Standard – 100 x 5.322 = $532 per month Paid quarterly!

6. Accidental Death & Dismemberment Insurance (AD&D)

7. What is my current coverage? • $10,000 Basic Insurance – University paid • Plan C participants receive $100,000 • $100,000 Business Travel Accidental Death Insurance – University paid • Supplemental AD&D available for employee and dependents – paid for entirely by employee • AXA Travel Assistance Program • Automatically included with Basic AD&D coverage

8. Long Term Care

9. What is Long Term Care Insurance • Long-term care is personal care or supervision needed by persons of all ages for an extended period of time • It may be needed due to an accident or illness, or the effects of aging • Some conditions that may require long-term care include: • Head Injury • Multiple Sclerosis • Parkinson’s Disease • Stroke • Heart Disease • Alzheimer’s Disease

10. The Need for LTC is Growing • Accidents and illness can occur at any age and may require LTC • Life expectancy is increasing, and the possible need for LTC increases with age • 69% of those turning 65 will need LTC at some point of their lives: • 17% in 1 year or less • 12% in 1-2 years • 20% in 2-5 years • 20% in more than 5 years

11. Salt Lake City $178 Minneapolis $166 Kansas City $163 Las Vegas $203 Columbus $212 Honolulu $290 Charlotte $166 Nashville $184 Santa Fe $177 Chicago $168 Phoenix $202 Seattle $252 Detroit $180 Denver $223 Helena $160 Austin $187 New York City $400 Los Angeles $217 Juneau $500 Boston $312 Salem $205 Lincoln $185 San Francisco $275 Philadelphia $259 Washington DC $277 Atlanta $179 Miami $248 St. Louis $161 Costs are High and Rising1 AK WA ME ND MT VT NH MN OR MA NY WI RI CT ID SD MI WY PA NJ IA NE MD OH DE IL NV IN WV UT VA CO CA MO KY KS NC TN OK SC AR AZ NM GA AL MS TX LA HI FL 1. Daily Nursing Home Costs in the U.S. based on the John Hancock 2008 Cost of Care Survey, conducted by CareScout, 2008.

12. Continuing your USC LTC coverage • Simply contact John Hancock or Genworth and arrange to pay the premiums directly. • Payments will be made either quarterly or twice a year. • Contact information: • John Hancock -1-888-524-6167 • Genworth – 1-800-416-3624

13. What if I don’t have Long Term Care? • Some pre-retirees/retirees may have saved enough money to “self insure” for these type of services; meaning they have enough money saved to cover these type of services, if needed • If you don’t have LTC insurance and feel you might need LTC (based on your personal health situation/family history) research the USC offering to determine whether you can qualify (there are underwriting requirements) and/or whether you can afford the premium which are age based • Contact Genworth for an enrollment kit or go online to enroll

14. What Is the Difference Between Long-Term Care and Long-Term Disability? • Long-term care insurance helps protect against financial loss in the event that you need long-term care services. If you become unable to care for yourself due to chronic illness, injury or the effects of aging, this insurance can help defray the costs of long-term care services. • Long-term disability insurance is meant to replace your income if you are unable to work due to illness or non-occupational injury. Long-term disability insurance does not provide benefits for long-term care services

15. Need more help? • California Department of Aging’s Health Insurance Counseling and Advocacy Program (HICAP) has developed a consumer guide to long term care which is included in our enrollment package. Additional counseling availablefrom HICAP: 1-800-927-HELP.

16. RETIREMENT PLANS

17. Getting your money • Defined Contribution Plan - Make sure to review the Distribution Instructions and Distribution Options forms in your packet and then contact your applicable vendor(s) to begin distributions. • Employees hired in 2012 may need to satisfy vesting to receive 100% of the university’s matching contribution

18. Defined Benefit Plan Options • The Defined Benefit Plan requires you to select an annuity option at time of retirement. This is an irrevocable election that will lock in your monthly lifetime pension payment. • Straight Life - Payments are made to you, for the remainder of your lifetime. Because there is no survivor benefit, this option yields the greatest monthly benefit. • 10 yr Certain - If you should die within the first 10 years of receiving the benefit, your beneficiary would receive the payments for the remaining years left in the 10 year period.

19. 50% Spousal Survivor+* - Your monthly benefit is reduced so that your surviving spouse will receive lifetime payments of 50% of your monthly benefit upon your death. • 75% Survivor Annuity – Your monthly benefit is reduced so that your surviving spouse will receive lifetime payments of 75% of your monthly benefit upon your death. • 100% Spousal Survivor* - Your monthly benefit is reduced so that your surviving spouse will receive lifetime payments of equal value upon your death. *These options are for married participants only. + Surviving spouse benefit if you should die before electing an annuity option

20. Health Insurance

21. What will be my retiree health insurance? • Depending on which plan you are enrolled in now and how old you are when you separate from service you may have several options available to you.

22. Under Age 65 • Elect COBRA for yourself and your dependents for whichever plan you were enrolled in as an active employee. COBRA may continue for the maximum allowable period (18 or 36 months) or until you reach age 65, whichever comes first. • COBRA for dental and vision is available for 18 months only. • BUT COBRA may or MAY NOT bridge you to Medicare eligibility (age 65) so plan carefully!

23. 65 or older • Common point of confusion for those continuing to work after age 65: • Do I need to enroll in Medicare since I am 65 (or older) but still working? No!!! • Our CHCR speaker will provide further details • Once enrolled in all parts of Medicare (A, B & D) you must decide if you want to purchase a Medicare supplement insurance or turn over your Medicare for HMO-style coverage

24. There are many Medicare (Medigap) options, research very carefully! • Very Important: • Notify all your providers that Medicare is now your primary insurance and not USC; a mess to clean up after the fact!

25. 65 or older • Another common questions we get is “What happens if my dependent(s) is not eligible for Medicare?” • Spouses: • COBRA (as long as it bridges them to age 65) or • an individual health policy www.ehealthinsurance.comor • AARP (see next slide) or • HIPAA Guarantee Issue Programs (thru an insurance broker) • Children: • Anthem Blue Cross Tonik (www.tonik.com/CA) or • www.ehealthinsurance.com or • Student Health (if applicable)

26. AARP Insurance Products-Age 50-64 • Choose from an array of quality comprehensive and supplemental health insurance plans selected exclusively for AARP members ages 50-64. • AARP Essential Premier Health Insurance • Specially selected individual major medical health insurance plans offering quality coverage for you and your family. • AARP Essential Health Insurance • These basic fixed-cash hospital indemnity plans offer some coverage with a significantly lower premium. • AARP Essential Plus Health Insurance • Enhanced fixed-cash hospital indemnity plans offering a lower-cost option to major medical insurance. • AARP Hospital Indemnity Insurance • Competitively priced indemnity plans with fixed-cash benefits payable in addition to other health insurance you might have.

27. Three Months Prior to Retirement Medicare Eligible Retirees • USC Network participants: • Contact Medicare to begin enrollment process for Parts B & D (Part A also if you did not enroll at age 65) • Begin researching Medigap plans • USC Senior Care is one option • Kaiser participants: • Contact Kaiser directly to enroll in their Senior Advantage Medicare product • www.kp.org

28. PacifiCare • Contact UnitedHealthcare directly to enroll in their Secure Horizons Medicare product • www.securehorizons.com • CaliforniaCare • Contact Blue Cross of California directly to enroll in their Senior Secure Plan • www.bluecrossca.com

29. What do I do when I am ready? • Faculty • Immediate retirement - notify your department as soon as you know your date • Phased Retirement – contact the Provost’s Office • 2 years max (3 years with Provost approval) • Reduce to 50% time • Give up tenure • Retirement money available if age 65, working 50% or less and have given up tenure • Health benefit eligibility will continue until end of phased retirement period

30. Staff • Notify your department/school as soon as possible • Common courtesy is 2-3 weeks to allow for replacement strategies.

31. Retiree Stipend • Eligibility • 15 years of service upon termination • Age 65 upon termination • Retired before start of new fiscal year • Employees who terminate with 15 years of service but are not age 65 can “age in”. When they hit age 65 we automatically send an enrollment application the following year. • “Perk” – • $60 per month paid quarterly

32. Retirees must apply for retiree stipend every year • Renewal letters are sent out every July • This is not a “benefit”. The Board of Trustees votes on continuation of program every year. • This program is not transferable to spouse/registered domestic partners.

33. Office of Benefits Administration Building: CUB 200 Hours: 8:00 am to 5:00 pm (phone) Phone: 740-6027 Fax: 740-3875 E-mail: benefits@usc.edu Web: http://www.usc.edu/dept/Benefits

34. Disclaimer This presentation of USC’s benefit plans has been designed to acquaint you with some of the basic features of the plans. The actual provisions of each benefit plan will govern if there is any inconsistency between this summary and USC’s formal plans and contracts. This summary does not constitute a contract for any benefit; USC reserves the right to modify or terminate its benefit plans.