August 14, 2014
To All SUAA Members and Friends!
Some of you were confused by yesterday’s email – SUAA News Alert! “CMS Withdraws New Rule Doubling Pension Deductions at SUAA Urging”
For clarification –
The Department of Central Management Services (CMS) enacted an emergency rule in July which went into effect immediately. That rule caused deductions for health insurance to double (1% to 2% for retirees on Medicare and 2% to 4% for retirees without Medicare). Because the rule went into effect immediately, you will have already seen those deductions on your recent pension checks.
Normally, an emergency rule goes into effect and remains in effect for 120 days. During that time, the Joint Committee on Administrative Rules (JCAR) takes comments on the rule. At the end of that period, JCAR either objects to the rule or approves it.
However, in light of Kanerva v. Weems, SUAA Executive Director Linda Brookhart sent a letter to Governor Quinn’s office complaining that the rule was inappropriate. As a result, the emergency rule was placed on JCAR’s radar and set for an immediate review at its August 12, 2014 hearing. This is not a normal step in the process.
Once the rule went onto JCAR’s agenda, SUAA followed up on Ms. Brookhart’s original letter to the Governor’s Office with a second letter from SUAA’s attorney, Aaron Maduff. Mr. Maduff’s letter included a legal analysis of the Kanerva v. Weems opinion. Mr. Maduff’s letter went to both CMS and JCAR. On Monday, August 11, Mr. Maduff was contacted by one of the JCAR members. At this time, Mr. Maduff provided a detailed explanation of why SUAA believed the rule was inappropriate in light of Kanerva.
CMS confirms that it has indeed withdrawn the emergency rule and expects to be publishing a new rule on August 22nd. This does not mean that a wand will be waived to change your health insurance withholding for July and August. It also does not change the 1% and 2% deduction that has been occurring since July of 2013. What should happen is that on your next pension check you should see a return to the 1% and 2% deduction.
Yesterday, SUAA filed a Petition to Intervene in the Kanerva case that has now been returned to the Sangamon County Court. SUAA intends to argue that, in light of the Supreme Court’s opinion, the Sangamon County Court should order that all deductions for health insurance premiums (i.e. the 1% and 2% that is still in effect) should cease. Legal battles like this, however, can take time and effort and there is no guarantee that those deductions will cease immediately. We do hope that we will prevail on the Court to do so within the next few months.
As always, SUAA will keep you updated as more information becomes available.
SUAA is represented by the Law Offices of Maduff & Maduff, LLC and by John D. Carr.
(A timeline of filings etc. with be provided soon)
Linda L. Brookhart
State Universities Annuitants Association