TRENTON – The Pension and Benefit Review Commission recommended the Legislature Friday not enact three of four bills before it.
It recommended enactment of a bill addressing so-called “divorce from bed and board,’’ but gave a thumbs down to bills dealing with autism coverage, pay hikes above actuarial assumptions, and coverage regarding certain workers called up for military duty.
A1469: This bill provides that the compensation of a public employee for retirement benefits will be limited to compensation consistent with increases actuarially assumed by the pension systems.
The bill requires the Division of Pensions and Benefits to examine a member’s compensation history for a minimum of five years prior to the filing for retirement benefits.
If in any one year, a member’s compensation increased by more than the actuarially assumed average experience, the division will require the employer to provide documentation justifying the increase in compensation and verify whether such an increase was given to any other employees at the same time.
Commission staff reported that the bill’s administrative problems and additional costs outweigh the intended benefits. They said that the bill addresses a situation when an employer “boosts’’ an employee’s salary, typically toward the end of their career, in order to help their pension.
It deals with situations in which a salary increase would be greater than what an actuary has assumed the increase should be.
But if the bill takes effect, the Commission raised the logistical issue, among other concerns, of whether an individual’s retirement benefits then would be held up until an employer pays the additional unfunded liability.
A2404/S1292: This bill provides that a member of the Police and Firemen’s Retirement System on official leave of absence with or without pay due to military Reserves duty will be considered to be an active PFRS member.
That ensures that police officers and firefighters called to active duty who are killed or injured remain eligible for PFRS death or disability benefits.
Commission staff pointed out that on the state level, this is being done now. There are two executive orders – issued by then-Govs. Donald DiFrancesco and Jim McGreevey – that are still in effect.
Among other things, the Commission had an issue with the bill in that it only addresses police officers and firefighters.
A3763: This provides that a healthcare benefits plan, fully or partly paid by public employer, cannot cover an employee’s spouse who is subject of “divorce from bed and board.”
This bill addresses a legal loophole that permits an employee’s ex-spouse to continue to receive healthcare benefits under a plan provided by a public employer.
In order to close this loophole, this bill excludes from coverage as a dependent under public employee healthcare benefits plans spouses who are divorced and legally separated civil union partners.
According to the bill, divorce from bed and board is a judgment from the courts when both spouses agree to separate from one another and divide marital property but remain legally married. Because this type of judgment is not a formal divorce, these individuals remain eligible to receive healthcare benefits under their spouse’s healthcare plan.
The Commission recommended enactment, and also that it be amended for retroactive removal of those currently receiving these benefits at some future date.
A3981: This requires health benefits coverage for diagnosing and treating autism and other developmental disabilities.
The bill expands the number of conditions covered, including such conditions as Asperger’s disorder, fragile X syndrome, childhood disintegrative disorder, and more.
The bill requires health insurers to provide coverage for various therapies: occupational, physical, and speech.
The Commission recommended not to enact due to the unknown future costs, and that there is a mechanism in place to address this through the new design committees under the overhaul of pension and benefits, and this would usurp their authority.