1991 PEB-219
AGREED UPON IMPLEMENTATION OF PUBLIC LAW 102-29
The attached
document reflects the joint efforts of the Brotherhood of Locomotive Engineers
and the National Carriers' Conference Committee to reduce to contract terms the
report and recommendations of Presidential Emergency Board No. 219 dated
This
understanding is based upon the provisions of Public Law 102-29, signed by the
President on April 18, 1991, which declares that the report and recommendations
of Presidential Emergency Board No. 219, as clarified and modified by Special
Board 102-29, shall be binding effective July 29, 1991, on the participating
carriers listed in Exhibit A, attached hereto and made a part hereof, and
represented by the National Carriers' Conference Committee of the National
Railway Labor Conference and certain of their employees represented by the
Brotherhood of Locomotive Engineers and shall have the same effect as though
arrived at by agreement of the parties in accordance with the Railway Labor
Act.
(SIGNATURES NOT REPRODUCED)
ARTICLE I - WAGES
Section 1 - Lump Sum
Payment
Each employee
subject to this Implementing Document who rendered compensated service on a
sufficient number of days during the calendar year 1990 to qualify for an
annual vacation in the calendar year 1991 will be paid $2,000 within 60 days of
the date of this Implementing Document. Those employees who rendered
compensated service on an insufficient number of days during the calendar year
1990 to qualify for an annual vacation in the calendar year 1991 will be paid a
proportional share of that amount. This Section shall be applicable solely to
those employees subject to this Implementing Document who have an employment
relationship as of the date of this Implementing Document or who have retired
or died subsequent to
Section 2 - First General Wage Increase
(a) Effective
(b) In
computing the increase under paragraph (a) above, three (3) percent shall be
applied to the standard basic daily rates of pay applicable in the following
weight-on-drivers brackets, and the amounts so produced shall be added to each
standard basic daily rate of pay:
Passenger 600,000 and less than 650,000 pounds
Freight 950,000 and less than 1,000,000 pounds
(through freight rates)
Yard Engineers Less than 500,000 pounds
Yard Firemen Less than 500,000 pounds
(separate
computation covering five-day rates and other than five day rates)
Section 3 - Second
General Wage Increase
Effective July
1, 1993, all standard basic daily rates of pay of employees represented by the
Brotherhood of Locomotive Engineers in effect on June 30, 1993 shall be increased
by three (3) percent, computed and applied in the same manner prescribed in
Section 2 above.
Section 4 - Third
General Wage Increase
Effective July
1, 1994, all standard basic daily rates of pay of employees represented by the
Brotherhood of Locomotive Engineers in effect on June 30, 1994 shall be
increased by four (4) percent, computed and applied in the same manner
prescribed in Section 2 above.
Section 5 - Standard
Rates
The standard
basic daily rates of pay produced by application of the increases provided for
in this Article are set forth in Appendix 1, which is a part of this
Implementing Document.
Section 6 - Application of Wage Increases
(a) Duplicate
time payments, including arbitraries and special allowances that are expressed
in time, miles or fixed amounts of money, and mileage rates of pay for miles
run in excess of the number of miles comprising a basic day, will not be
subject to the adjustments provided for in this Article.
(b)
Miscellaneous rates based upon hourly or daily rates of pay, as provided in the
schedules or wage agreements, shall be adjusted under this Implementing
Document in the same manner as heretofore increased under previous wage
agreements.
(c) In
determining new hourly rates, fractions of a cent will be disposed of by
applying the next higher quarter of a cent.
(d) Daily
earnings minimum shall be changed by the amount of the respective daily
adjustments.
(e) Existing money differentials above
existing standard daily rates shall be maintained.
(f) In local
freight service, the same differential in excess of through freight rates shall
be maintained.
(g) Where applicable, the differential
of $4.00 and/or S6.00 per basic day in freight, passenger and yard service, and
4 cents and/or 6 cents per mile for miles in excess of the number of miles
encompassed in the basic day in freight and passenger service, will be
maintained for engineers working without firemen on locomotives on which under
the former National Diesel Agreement of 1950 firemen would have been required.
Such differential will continue to be applied in the same manner as the local
freight differential.
(h) In
computing the first increase in rates of pay effective July 1, 1 991, under
Section 2 for firemen employed in local freight service, or on road switchers,
roustabout runs, mine runs, or in other miscellaneous service, on runs of miles
equal to or less than the number comprising a basic day, which are therefore
paid on a daily basis without a mileage component, whose rates had been
increased by "an additional $.40" effective July 1, 1968, the three
(3) percent increase shall be applied to daily rates in effect June 30, 1991,
exclusive of local freight differentials and any other money differential above
existing standard daily rates. For firemen, the rates applicable in the
weight-on drivers bracket 950,000 and less
than 1,000,000 pounds shall be utilized in computing the amount of increase.
The same procedure shall be followed in computing the increases effective July
l, 1993 and
(i) Other than standard rates:
(i) Existing
basic daily rates of pay other than standard shall be changed, effective as of
the dates specified in Sections 2, 3 and 4 hereof, by the same respective
percentages as set forth therein, computed and applied in the same manner as
the standard rates were determined.
(ii) Where
applicable, the differential of $4.00 and/or $6.00 per basic day in freight,
passenger and yard service, and 4 cents and/or 6 cents per mile for miles in
excess of the number encompassed in the basic day in freight and passenger
service, will be maintained for engineers working without firemen on
locomotives on which under the former National Diesel Agreement of 1950 firemen
would have been required. Such differential will continue to to be applied in
the same manner as the local freight differential.
(iii) Daily
rates of pay, other than standard, of firemen employed in local freight
service, or on road switchers, roustabout runs, mine runs, or in other
miscellaneous service, on runs of miles equal to or less than the number
encompassed in the basic day, which are therefore paid on a daily basis without
a mileage component, shall be increased as of the effective dates specified in
Sections 2, 3 and 4 hereof, by the same respective percentages as set forth
therein, computed and applied in the same manner as provided in paragraph
(i)(i) above.
ARTICLE II - COST-
OF-LIVING PAYMENTS
PART A -
Cost-of-Living Lump Sum Payments Through
Section 1 - First Lump
Sum Cost-of-Living Payment
Subject to
Sections 6 and 7, employees with 2,000 or more straight time hours paid for
(not including any such hours reported to the Interstate Commerce Commission as
constructive allowances except vacations, holidays and guarantees in protective
agreements or arrangements) during the period April 1, 1991 through March 31,
1992, will receive a lump sum payment on July 1, 1992 of $1,455.00
Section 2 - Second
Lump Sum Cost-of Living Payment
Subject to
Sections 6 and 7, employees with 1,000 or more straight time hours paid for
(not including any such hours reported to the ICC as constructive allowances
except vacations, holidays and guarantees in protective agreements or
arrangements) during the period April 1, 1992 through September 30, 1992, will
receive a lump sum payment on January 1, 1993 equal to the difference between
(i) $1,444.00, and (ii) the lesser of $720.00 and one quarter of the amount, if
any, by which the
carriers' 1993 payment rate for foreign-to-occupation health benefits under the
Railroad Employees National Health and Welfare Plan (the "Plan")
exceeds the sum of (a) the amount of such payment rate for 1992 and (b) the
amount per covered employee that will be taken during 1993 from that certain
special account maintained at The Travelers Insurance Company known as the "Special Account
Held in Connection with the Amount for the Close-Out Period (the ("Special
Account") to pay or provide for Plan foreign-to-occupation health benefits.
Section 3 - Third Lump
Sum Cost-of Living Payment
Subject to
Sections 6 and 7, employees with 2,000 or more straight time hours paid for
(not including any such hours reported to the ICC as constructive allowances
except vacations, holidays and guarantees in protective agreements or
arrangements) during the period October 1, 1992 through September 30, 1993,
will receive a lump sum payment on January 1, 1994 equal to the difference
between (i) $1,467.00, and (ii) the lesser of $733.50 and one quarter of the
amount, if any, by which the carriers' 1994 payment rate for
foreign-to-occupation health benefits under the Plan exceeds the sum of (a) the
amount of such payment rate for 1993 and (b) the amount per covered employee
that will be taken during 1994 from the Special Account to pay or provide for Plan
foreign-to-occupation health benefits.
Section 4 - Fourth
Lump Sum Cost-of Living Payment
Subject to
Sections 6 and 7, employees with 2,000 or more straight time hours paid for
(not including any such hours reported to the ICC as constructive allowances
except vacations, holidays and guarantees in protective agreements or
arrangements) during the period October 1, 1993 through September 30, 1994,
will receive a lump sum payment on January 1, 1995 equal to the difference
between (i) $1,006.00, and (ii) the lesser of $503.00 and one quarter of the
amount, if any, by which the carriers' 1995 payment rate for
foreign-to-occupation health benefits under the Plan exceeds the amount of such
payment rate for 1994.
Section 5 - Definition
of Payment Rate for Foreign to Occupation Health Benefits
The carrier's
payment rate for any year for foreign-to-occupation health benefits under the
Plan shall mean twelve times the payment made by the carriers to the Plan per
month (in such year) per employee who is fully covered for employee health
benefits under the Plan. Carrier payments to the Plan for these purposes shall
not include the amounts per such employee per month (in such year) taken from
the Special Account, or from any other special account, fund or trust maintained
in connection with the Plan, to pay or provide for current Plan benefits, or
any amounts paid by remaining carriers to make up the unpaid contributions of
terminating carriers pursuant to Article III, Part A, Section 1 hereof.
Section 6 - Employees Working
Less Than Full Time
For employees
who have fewer straight time hours (as defined) paid for in any of the
respective periods described in Sections 1 through 4 than the minimum number
set forth therein, the dollar amounts specified in clause (i) thereof shall be
adjusted by multiplying such amounts by the number of straight time hours
(including vacations, holidays and guarantees in protective agreements or
arrangements) for which the employee was paid during the applicable measurement
period divided by the defined minimum hours. For any such employee, the dollar
amounts described in clause (ii) of such Sections shall not exceed one-half of
the dollar amounts specified in clause (i) thereof, as adjusted pursuant to
this Section.
Section 7 - Lump Sum Proration
In the case of
any employee subject to wage progression or entry rates, the dollar amounts
specified in clause (i) of Sections 1 through 4 shall be adjusted by
multiplying such amounts by the weighted average entry rate percentage
applicable to wages earned during the specified determination period. For any
such employee, the dollar amounts described in clause (ii) of such Sections
shall not exceed one-half of the dollar amounts specified in clause (i)
thereof, as adjusted pursuant to this Section.
Section 8 -
Eligibility for Receipt of Lump Sum Payments
The lump sum
cost-of-living payments provided for in this Article will be payable to each
employee subject to this Implementing Document who has an employment
relationship as of the dates such payments are made or has retired or died
subsequent to the beginning of the applicable base period used to determine the
amount of such payments. There shall be no duplication of lump sum payments by
virtue of employment under an agreement with another organization.
PART B - Cost of-Living Allowance and Adjustments Thereto After
Section 1 -
Cost-of-Living Allowance and Effective Dates of Adjustments Thereto
(a)
A cost of living allowance will be payable in the manner set forth in and subject
to the provisions of this Part, on the basis of the "Consumer Price Index
for Urban Wage Earners and Clerical Workers (Revised Series) (CPI-W)"
(1967=100), U.S. Index, all items - unadjusted, as published by the Bureau of
Labor Statistics, U.S. Department of Labor, and hereinafter referred to as the
BLS CPI. The first such cost-of-living allowance shall be payable effective
Measurement Periods
Effective Date Base
Month Measurement
Month
Of Adjustment
September 1994 March
1995
March 1995 September
1995
Measurement
Periods and Effective Dates conforming to the above schedule shall be
applicable to periods subsequent to those specified above during which this
Article is in effect.
(b) While a
cost-of-living allowance is in effect, such -cost-of-living allowance will
apply to straight time, overtime, vacations, holidays and to special allowances
in the same manner as basic wage adjustments have been applied in the past,
except that such allowance shall not apply to duplicate time payments,
including arbitraries and special allowances that are expressed in time, miles
or fixed amounts of money or to mileage rates of pay for miles run in excess of
the number of miles comprising a basic day.
(c)
The amount of the cost-of-living allowance, if any that will be effective from
one adjustment date to the next may be equal to, or greater or less than, the
cost-of-living allowance in effect in the preceding adjustment period.
(d) (i) Cap.
In calculations under paragraph (e), the maximum increase in the BLS CPI that
will be taken into account will be as follows:
Effective Date Maximum
CPI Increase That of Adjustment May Be Taken Into Account
September
1994 to March 1995
Effective Dates
of Adjustment and Maximum CPI Increases conforming to the above schedule shall
be applicable to periods subsequent to those specified above during which this
Article is in effect.
(ii) Limitation.
In calculations under paragraph (e), only fifty (50) percent of the increase in
the BLS CPI in any measurement period shall be considered.
(iii) If the
increase in the BLS CPI from the base month of September 1994 to the
measurement month of March 1995 exceeds 3% of the September base index, the
measurement period that will be used for determining the cost-of-living
adjustment to be effective the following January will be the 12-month period
from such base month of September, the increase in the index that will be taken
into account will be limited to that portion of the increase that is in excess
of 3% of such September base index; and the maximum increase in that portion of
the index that may be taken into account will be 6% of such September base
index less the 3% mentioned in the preceding clause, to which will be added any
residual tenths of points which had been dropped under paragraph (e) below in
calculation of the cost-of living adjustment which will have become effective
July 1, 1995 during such measurement period.
(iv) Any increase
in the BLS CPI from the base month of September 1994 to the measurement month
of September 1995 in excess of 6% of the September 1994 base index will not be
taken into account in the determination of subsequent cost-of-living
adjustments.
(v) The procedure
specified in subparagraphs (iii) and (iv) will be applicable to all subsequent
periods during which this Article is in effect.
(e) Formula.
The number of points change in the BLS CPI during a measurement period, as
limited by paragraph (d), will be converted into cents on the basis of one cent
equals 0.3 full points. (By "0.3 full points" it is intended that any
remainder of 0.1 point or 0.2 point of change after the conversion will not be
counted.) The cost-of-living allowance in effect on December 31, 1995 will be
adjusted (increased or decreased) effective January 1, 1996 by the whole number
of cents produced by dividing by 0.3 the number of points (including tenths of
points) change, as limited by paragraph (d), in the BLS CPI during the applicable
measurement period. Any residual tenths of a point resulting from such division
will be dropped. The result of such division will be added to the amount of the
cost-of-living allowance in effect on December 31, 1995 if the BLS CPI will
have been higher at the end than at the beginning of the measurement period,
and subtracted therefrom only if the index will have been lower at the end than
at the beginning of the measurement period and then, only, to the extent that
the allowance remains at zero or above. The same procedure will be followed in
applying subsequent adjustments.
(f) Continuance
of the cost-of-living allowance and the adjustments thereto provided herein is
dependent upon the availability of the official monthly BLS Consumer Price
Index (CPI-W) calculated on the same basis as such Index, except that, if the
Bureau of Labor Statistics, U.S. Department of Labor should, during the
effective period of this Article, revise or change the methods or basic data
used in calculating such Index in such a way as to affect the direct
comparability of such revised or changed index with the CPI-W Index during a
measurement period, then that Bureau shall be requested to furnish a conversion
factor designed to adjust the newly revised index to the basis of the CPI-W
Index during such measurement period.
Section 2 - Payment of Cost-of-Living Allowances
(a) The
cost-of-living allowance payable to each employee effective July 1, 1995 shall
be equal to the difference between (i) the cost-of-living allowance in effect
on that date pursuant to Section 1 of this Part, and (ii) the cents per hour
produced by dividing one-quarter of the increase, if any, in the carriers' 1995
payment rate for foreign-to-occupation health benefits under the Plan over such
payment rate for 1994, by the average composite straight-time equivalent hours
that are subject to wage increases for the latest year for which statistics are
available, but not more than one-half of the amount specified in clause (i)
above. For the purpose of the foregoing calculation, the amount of any increase
described in clause (ii) that has been taken into account in determining the
amount received by the employee as a lump sum payment on
(b) The
cost-of-living allowance payable to each employee effective January 1, 1996,
shall be equal to the difference between (i) the cost-of-living allowance in
effect on that date pursuant to Section 1 of this Part, and (ii) the cents per
hour produced by dividing one-quarter of the increase, if any, in the carriers'
1996 payment rate for foreign-to-occupation health benefits under the Plan over
the amount of such payment rate for 1995, by the average composite
straight-time equivalent hours that are subject to wage increases for the
latest year for which statistics are available, but not more than one-half of
the amount specified in clause (i) above.
(c) The
procedure specified in paragraph (b) shall be followed with respect to
computation of the cost-of-living allowances payable in subsequent years during
which this Article is in effect.
(d) The
definition of the carriers' payment rate for foreign-to-occupation health
benefits under the Plan set forth in Section 5 of Part A shall apply with
respect to any year covered by this Section.
(e) In making
calculations under this Section, fractions of a cent shall be rounded to the
nearest whole cent; fractions less than one-half cent shall be dropped and
fractions of one-half cent or more shall be increased to the nearest full cent.
Section 3 - Application of Cost-of- Living
Allowances
The
cost-of-living allowance provided for in this Part will not become part of
basic rates of pay. In application of such allowance, each one-cent per hour of
cost-of-living allowance that is payable will be treated as an increase of 8
cents in the basic daily rates of pay produced by application of Article I. The
cost-of-living allowance will otherwise be applied in keeping with the
provisions of Section 6 of Article I.
Section 4 -
Continuation of Part B
The
arrangements set forth in Part B of this Article shall remain in effect
according to the terms thereof until revised by the parties pursuant to the
Railway Labor Act.
ARTICLE III -
HEALTH AND WELFARE PLAN AND EARLY RETIREMENT MAJOR MEDICAL BENEFIT PLAN
Part A - Health and
Welfare Plan
Section 1 -
Continuation of Plan
The Railroad
Employees National Health and Welfare Plan (the "Plan"), modified as
provided in this Part, will be continued subject to the provisions of the
Railway Labor Act, as amended. Contributions to the Plan will be offset by the
expeditious use of such amounts as may at any time be in Special Account A or
in one or more special accounts or funds maintained by any insurer, third party
administrator or other entity in connection with the Plan and by the use of
funds held in trust that are not otherwise needed to pay claims, premiums, or
administrative expenses that are payable from funds held in trust; provided,
however, that such amounts as may at any time be in that certain special
account maintained at The Travelers Insurance Company, known as the 'Special
Account Held in Connection with the Amount for the Close-Out Period,' relating
to the obligations of the Plan to pay, among other things, benefits incurred
but not paid at the time of termination of the Plan in the event such
termination should occur, shall be used to pay or provide for Plan benefits as
follows: one-third of the balance in such special account as of January 1, 1992, shall be used to pay or provide for
benefits that become due and payable during 1992. One-half of the balance in
such special account as of
In the event
that a carrier participating in the Plan defaults for any reason, including but
not limited to bankruptcy, on its obligation to contribute to the Plan, and the
carrier's participation in the Plan terminates, the carriers remaining in the
Plan shall be liable for any Plan contribution that was required of the
terminating carrier prior to the effective date of its termination, but not
paid by it. The remaining carriers shall be obligated to make up in a timely fashion
such unpaid contribution of the terminating carrier in pro rated amounts based
upon their shares of Plan contributions for the month immediately prior to such
default.
Section 2 - Change to
Self-Insurance
Except for life
insurance, accidental death and dismemberment insurance, and all benefits for
residents of
Section 3 - Joint Plan
Committee
The Joint
Policyholder Committee shall be renamed the Joint Plan Committee. This change
in name shall not in any way change the functions and responsibilities of the
Committee.
A neutral shall
be retained by and at the expense of the Plan for the duration of this
Implementing Document to consider and vote on any matter brought before the
Joint Plan Committee (formerly the Joint Policyholder Committee), arising out
of the interpretation, application or administration (including investment
policy) of the Plan, but only if the Committee is deadlocked with respect to
the matter. A deadlock shall occur whenever the carrier members of the
Committee, who shall have a total of one vote regardless of their number, and
the organization members of the Committee, who shall also have a total of one
vote regardless of their number, do not resolve a matter by a vote of two to
nil and either side declares a deadlock.
If the members
of the Joint Plan Committee cannot agree upon a neutral within 30 days of the
date this Implementing Document becomes effective, either side may request the
National Mediation Board to provide a list of seven persons from which the
neutral shall be selected by the procedure of alternate striking. Joint Plan
Committee members and the neutral shall, to the extent required by ERISA, be
bonded at the expense of the Plan. The Joint Plan Committee shall have the
power to create such subcommittees, as it deems appropriate and to choose a
neutral chairman for such subcommittees, if desired.
Section 4 - Managed
Care
Managed care networks that meet
standards developed by the Joint Plan Committee, or a subcommittee thereof,
concerning quality of care, access to health care providers, and
cost-effectiveness, shall be established wherever feasible as soon as
practicable. Until a managed care network is established in a given
geographical area, individuals in that area who are covered by the Plan will
have the comprehensive health care benefit coverage described in Section 5 of
this Part A. Each employee in a given geographical area who is a Plan
participant at the time a managed care network is established in that area will
be enrolled in the network (along with his or her covered dependents) unless
the employee provides timely written notice to his or her employer of an
election to have (along with his or her covered dependents) the comprehensive
health care benefit coverage rather than to be enrolled in the network. Any
such employee who provides such timely written notice shall have an annual
opportunity to revoke his or her election by providing a written notice of
revocation to his or her employer at least sixty days prior to January 1 of the
calendar year for which such revocation shall first become effective.
Similarly, each employee in a given geographical area who is a Plan participant
at the time a managed care network is established in that area and is
thereafter enrolled in the network (along with his or her covered dependents)
shall have an annual opportunity to elect to have (along with his or her
covered dependents) the comprehensive health care benefit coverage rather than
continue to be enrolled in the network. This election may be made by such an
employee by providing written notice thereof to his or her employer at least
sixty days prior to January 1 of the calendar year for which the election shall
first become effective. Each employee hired after a managed care network is
established in his or her geographic area (and his or her covered dependents)
will be enrolled in the network and may not thereafter elect to be covered by
the comprehensive benefits until the January 1 which falls on or after the
first anniversary of his or her initial date of eligibility for Plan coverage.
Employees who return to eligibility for Plan coverage within 24 months of loss
of eligibility for Plan coverage and whose employment relationship has not
terminated at any time prior to such return will be enrolled in the program of
Plan benefits in which they were enrolled when their eligibility for Plan
coverage was lost, and shall thereafter have the same rights of election as
other employees whose eligibility for Plan coverage was not lost.
Covered
individuals enrolled in a managed care network will have a point of service
option allowing them to choose an out-of-network provider to perform any
covered health care service that they need. The benefits provided by the Plan
when a service is performed by an in-network provider and the benefits provided
by the Plan when the service is performed by an out-of-network provider will be
as described in the table below:
PLAN FEATURE IN-NETWORK OUT-OF-NETWORK
Primary Care Physician yes No
Required
Annual Deductible
Individual None $100
Family None $300
Deductible applies to all covered
expenses
Plan/Employee Coinsurance 100%/0% 75%/25%
Annual Out-of-Pocket Maximum
(exclusive of deductible)
Individual None $1.500
Family None $3,000
Maximum Lifetime Benefit None $1000000
($5000 annual restoration)
Special Maximum Lifetime None $100,000
Benefit for Mental Health lifetime
($500 annual restoration)
Hospital Charges
(inpatient and outpatient) 100% 75%*
employee co-payment
Inpatient Mental Health &
Substance Abuse Benefit
Hospital 100% 75%#
Alternative Care - 100% 75%#
Residential Treatment
Center Inpatient or
Partial Hospitalization/
Day Treatment
Outpatient Mental Health & 100% after $15 75%#
Substance Abuse employee copayment
per
visit
Physician Services
Surgery/Anesthesia 100% 75%*
Hospital Visits 100% 75%*
Office Visits 100% after $15 75%**
employee
copayment
Diagnostic Tests 100% 75%*
Routine Physical 100% after $15 Not Covered
employee
copayment
Well Baby Care 100% after
$15 Not Covered
employee
copayment
Skilled Nursing Facility 100% 75%*
Care
Hospices Care 100% 75%*
Home Health Care 100% 75%*
Temporomandibular Joint 100% 75%*
Syndrome
Birth Center 100% 75%*
Prescription Drugs 100% after $5 75%**
(other than by employee copayment
mail order)
for brand name ($3 for
generic)
Mail Order Prescription 100% after $5 100% (not subject to
Drugs (60-90 day supply employee copayment regular deductible)
of maintenance drugs after
$5 employee co-
only) payment
(not counted
toward
regular de-
ductible)**
Approved by Utilization Physician-initiated Required. If approval
Review/Large Case included in network not given, benefits
Management management reduced by 20%
(except
for
mental health and
substance
abuse care
where benefits
reduced by 50%) both before and
after
annual out-of-
pocket
maximum is
reached,
and amount of
reduction
is not counted
toward
that maximum
t The medically necessary health care services
for which out-of-network benefits will be paid are those listed in subparagraphs
1 through 7 of Part A, Section 5, of this Implementing Document.
* Benefits reduced by 20% if care is not
approved by utilization review program.
# Benefits reduced by 50% if care is
not approved by utilization review program.
** Benefits not generally subject to
utilization review program but may be reviewable in specific circumstances with
advance notice to the employee; in such cases, benefits reduced by 20% if care
not approved by utilization review program.
At any time after the expiration of
two years from the effective date of implementation of the first managed care
network, either the carriers or the organizations may bring before the Joint
Plan Committee for consideration a proposal to change the Plan's in-network or
out-of-network benefits for the purpose of promoting an increase in the use of
in-network providers by Plan participants.
Section 5 - Comprehensive Health Care Benefits
The comprehensive health care
benefits provided under the Plan in geographical areas where managed care networks
are not available to Plan participants and their dependents, and in cases where
a Plan participant has elected to be covered, along with his or her dependents,
by such comprehensive benefits rather than to be enrolled in a managed care
network, shall be as described below. Terms used in such description shall have
the same meaning as they have in the Plan.
After
satisfaction of an annual deductible of $100 per covered individual or $300 per
family unit of three or more, the Plan will pay 85%, and the covered individual
15%, of certain health care expenses, up to an annual out-of- Pocket maximum
which shall not include the deductible) of $1,500 per covered individual or
$3,000 per family. The expenses counted toward the $3,000 annual family out-of-pocket
maximum will include those, which are otherwise eligible, incurred on behalf of
a covered employee and each of his or her covered dependents regardless of
whether the employee or dependent has reached the $1,500 individual annual
out-of-pocket maximum. Once
the applicable
annual out-of-pocket maximum has been reached, the Plan will pay 100% of such
reasonable charges up to an overall lifetime maximum of $1 million per covered
individual, restorable at a rate of $5,000 per year; provided, however, that
there shall be a separate lifetime maximum of $100,000 per covered individual,
restorable at a rate of $500 per year, for Plan benefits for the treatment of
mental and/or nervous conditions and substance abuse. (Benefits counted for
purposes of determining whether or not a lifetime maximum has been reached are
all benefits paid under the Plan as amended by this Implementing Document and
all Major Medical Expense Benefits paid under the Plan prior to such
amendments.) The Plan will pay 85% of the reasonable charges for medically
necessary health care services as follows:
1. All expenses
that are "Covered Expenses" (as defined in the Plan) at any time
under the current major medical expense benefits provisions of the Plan, and
not within any exclusion from or limitation upon them, except that the
exclusion for treatment of polio will be removed.
2. Expenses for
mammograms described in American Cancer Society guidelines, childhood disease
immunization, pap smears and colorectal cancer screening.
3. Donor expense
benefits as now defined.
4. Jaw joint
disorder benefits as now defined, and subject to the current exclusions from
and limitation on them, except that the $50 separate lifetime cash deductible
will be removed.
5. Home health
care expense benefits as now defined, subject to the current exclusions from
and limitation on them, except that the exclusion that governs if polio
benefits are payable will be removed.
6. Treatment
center expense benefits, subject to the current exclusions from and limitation
on them, except that:
a. the separate
$100 cash deductible per confinement will be removed in connection with
benefits for transportation to a treatment center, and
b. the separate
$100 cash deductible per benefit period and the S40 maximum limitation on benefits
per episode of treatment - all with regard to outpatient benefits - will be
removed.
7. Expenses for
the services of psychologists if benefits would be paid for such services had
they been rendered by a physician.
The Plan will
provide the same benefits to all employees eligible for Plan coverage,
including those in their first year of such eligibility and those eligible for
extended Plan coverage because of disability.
The Plan's
comprehensive health care benefits will include, where permissible under
applicable law, a mail order prescription drug benefit that will reimburse a
covered individual, after he or she pays $5.00 per prescription, 100% of the
cost of prescriptions covering a 60-to-90 day supply of maintenance drugs for
such individual. This benefit will not be subject to, and the covered
individual's S5.00 co-payment will not be counted against, the Plan's regular
S10~/$300 deductible and will be included only upon execution of appropriate
contracts with vendors.
Section 6 - Strengthened Utilization Review and Case Management
The Plan's
current utilization review/case management contractor, and any successor, shall
henceforth require that its prior approval be secured for the following
services to the extent that benefits with respect to them are payable under the
Plan: (a) all non-emergency confinements, and all lengths of stay, in any
facility, (b) all home health care, and (c) all in-patient and out-patient
procedures and treatment, except for any care where, pursuant to standards developed
by the Joint Plan Committee, prior approval is not feasible or would not be
cost-efficient. Approval may be withheld if the utilization review/case
management contractor determines that a less intensive or more appropriate
diagnostic or treatment alternative could be used.
If an
individual covered by the Plan incurs expenses without the requisite approval
of the Plan's utilization review/case management contractor, such benefits as
the Plan would otherwise pay will be reduced by one-fifth; provided, however,
that if such unapproved expenses are incurred for the treatment of mental or
nervous conditions or substance abuse, such benefits as the Plan would
otherwise pay will be reduced by one-half. These reductions will continue to
apply after the out-of-pocket maximum is reached, i.e., the l00% benefit
will become 80 % (or 50%, as the case may be) if approval by the utilization
review/case management contractor is not obtained.
When there is
disagreement between an attending physician and the utilization review/case
management contractor, the patient and/or attending physician, after all
opportunities for appeal have been exhausted within the utilization review/case
management contractor's organization, shall be afforded an opportunity to
obtain a review (including if necessary, an examination) by an independent
specialist physician. This independent physician, who shall be conveniently
located and board certified in the appropriate specialty, shall be designated
by a physician appointed for this purpose by the Joint Plan Committee. Neither
physician may be an employee of or under contract to the utilization
review/case management contractor. In the event of an appeal to a specialist described above, the
utilization review/case management contractor shall bear the burden of
convincing the specialist that the utilization review/case management
contractor's determination was correct.
Section 7 - Coordination of Benefits
The Plan's
coordination of benefit rules shall be changed so that the Plan will pay no benefit to any covered
individual that would cause the sum of the benefits paid by the Plan and by any
other plan with which the Plan coordinates benefits to exceed (a) the maximum
benefit available under the more generous of the Plan and such other plan, or
(b) with respect only to spouses who are both covered as employees under the
Plan (and the Dependents of such spouses), and to spouses one of whom is
covered as an employee under the Plan and the other as a retired railroad
employee under the Railroad Employees National Early Retirement Major Medical
Benefit Plan (and the Dependents of such spouses), 100% of the reasonable
charges for services the expense of which is covered by the Plan.
Section 8 - Medicare Part B Premiums
Active
employees currently covered by Medicare Part B and those who elect to enroll in
Medicare Part B when they become eligible shall not be reimbursed for premiums
they pay for such Part B Medicare participation unless Medicare is their
primary payor of medical benefits.
Section 9 - Solicitation of Bids
As promptly as
practicable, the Joint Plan Committee will solicit bids from qualified entities
for the performance of (a) all managed care functions under the Plan, including
without limitation the establishing and/or arranging for the use by individuals
covered by the Plan of managed networks of health care providers in those
geographical areas where it is feasible to do so, and (b) all utilization
review/case management functions under the Plan, including specialized
utilization review/case management functions for mental health and substance
abuse to assure expert determination of medical necessity and appropriateness
of treatment and provider. The Committee will select one or more contractors,
from among those that the Committee determines are likely to provide
high-quality, cost-effective services, to perform such functions on behalf of
the Plan. In the meantime, the Plan's current utilization review/case
management contractor will continue to perform those functions. Hospital associations
shall be incorporated into the managed care networks wherever appropriate. Upon
the expiration of three years from the effective date of this Implementing
Document, the Joint Plan Committee will solicit bids for all of the services
involved in the administration of the Plan, including the utilization
review/case management and/or managed care functions, unless the Committee
unanimously determines not to seek bids for any one or more of the services
involved in the administration of the Plan.
Part B - Early Retirement Major Medical Benefit Plan
Section 1 - Continuation of Plan
The Railroad
Employees Early Retirement Major Medical Benefit Plan ("ERMA"),
modified as provided in this Part, will be continued subject to the provisions
of the Railway Labor Act, as amended. Contributions to ERMA will be offset by
the expeditious use of such amounts as may at any time be in one or more
special accounts or funds maintained by any insurer, third party administrator
or other entity in connection with ERMA and by the use of funds held in trust
that are not otherwise needed to pay claims, premiums, or administrative
expenses that are payable from funds held in trust; provided, however, that
such amounts as may at any time be in the special account maintained at The
Travelers Insurance Company in connection with the obligations of ERMA to pay
benefits incurred but not paid at the time of termination of ERMA, in the event
such termination should occur, shall be used to pay or provide for Plan
benefits as follows: one-third of the balance in such special account as of
January 1, 1992, shall be used to pay or provide for benefits that become due
and payable during 1992. One-half of the balance in such special account as of
Section 2 - Change to Self-Insurance
EMRA will be
wholly self-insured. It will be administered, under an administrative services
only arrangement, by an insurance company or third party administrator.
Section 3 - Coordination of
Benefits
ERMA's
coordination of benefit rules shall be changed so that ERMA will pay no benefit
to any covered individual that would cause the sum of the benefits paid by ERMA
and by any other plan with which ERMA coordinates benefits to exceed (a) the
maximum benefit available under the more generous of ERMA and such other plan,
or (b) with respect only to spouses who are both covered as retired railroad
employees under ERMA (and the Dependents of such spouses), and to spouses one
of whom is covered as a retired railroad employee under ERMA and the other as
an employee under the Railroad Employees National Health and Welfare Plan (and
the Dependents of such spouses), 100% of the reasonable charges for services
the expense of which is covered by ERMA.
Section 4 - Strengthened Utilization Review and Case Management
ERMA's current
utilization review/case management contractor, and any successor, shall
henceforth require that its prior approval be secured for the following
services to the extent that benefits with respect to them are payable under
ERMA: (a) all non-emergency confinements, and all lengths of stay, in any
facility, (b) all home health care, and (c) all in-patient and out-patient
procedures and treatment, except for any care where prior approval is not
feasible or would not be cost-efficient. Approval may be withheld if the
utilization review/case management contractor determines that a less intensive
or more appropriate diagnostic or treatment alternative could be used.
If an
individual covered by ERMA incurs expenses without the requisite approval of
ERMA's utilization review/case management contractor, such benefits as ERMA
would otherwise pay will be reduced by one-fifth; provided, however, that if
such unapproved expenses are incurred for the treatment of mental or nervous
conditions or substance abuse, such benefits as ERMA would otherwise pay will
be reduced by one-half.
When there is disagreement between an attending physician and the utilization review/case management contractor, the patient and/or attending physician, after all opportunities for appeal have been exhausted within the utilization review/case management contractor's organization, shall be afforded an opportunity to obtain a review (including if necessary, an examination) by an independent specialist physician. This independent physician, who shall be conveniently located and board certified in the appropriate specialty, shall be designated by a physician appointed for this purpose by mutual agreement between the Chairman of the Health and Welfare Committee, Cooperating Railway Labor Organization and of the National Carriers' Conference Committee. Neither physician may be an employee of or under contract to the utilization review/case management contractor. In the event of an appeal to a specialist described above, the utilization review/case management cont