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Employers

Employer Bulletin

State Agencies and Local ICI Employers
Vol. 22, Local B
January 14, 2005

New Benefit Maximums for Income Continuation Insurance Coverage

The Group Insurance Board approved raising the maximum monthly Income Continuation Insurance (ICI) coverage and benefit and directed the Department of Employee Trust Funds to implement the new supplemental ICI coverage provisions. The new supplemental ICI coverage and benefits are effective April 1, 2005.

Currently, the ICI program covers 75% of an individual’s Wisconsin Retirement System (WRS) annual earnings up to a benefit maximum of $4,000 per month (75% of WRS annual earnings of $64,000). The new supplemental ICI coverage allows for a benefit maximum of $7,500 per month (75% of WRS annual earnings of $120,000) with the employee paying the entire premium above the current $4,000 per month benefit. Individuals with WRS annual earnings greater than $120,000 who enroll in the supplemental coverage are limited to a benefit based on earnings of $120,000.

Initial Open Enrollment Provisions

  • The initial open enrollment period for this new supplemental coverage will be February 21 – March 11, 2005.
  • Coverage is effective April 1, 2005.
  • WRS earnings for calendar year 2004 must exceed $64,000.
  • Enrollment in the supplemental coverage is voluntary.
  • Open enrollment for supplemental ICI coverage applies only to employees currently participating in ICI with an ICI coverage effective date of April 1, 2005 and earlier.
  • There is no provision for employer error within the ICI plan.

Future Enrollment Provisions

  • Newly insured employees with an ICI coverage date later than April 1, 2005 are eligible to enroll in Supplemental ICI effective on the ICI coverage begin date.
  • Annual WRS earnings must exceed $64,000.
  • Enrolling in the supplemental ICI coverage is voluntary.
  • Employees with ICI coverage who fail to enroll during the initial open enrollment can enroll on an annual basis concurrent with the annual deferred enrollment or annual premium adjustment period.
  • Employees with ICI coverage cannot apply for supplemental ICI by furnishing medical evidence of insurability.
  • Employees without ICI coverage can apply for both ICI and supplemental coverage by furnishing medical evidence of insurability.
  • There is no provision for employer error within the ICI plan.

Employees eligible to apply for the supplemental ICI coverage are those who meet/met the eligibility requirements for the ICI coverage per the State or Local plan and whose annual WRS earnings exceed $64,000. Eligible employees electing supplemental coverage must insure their entire salary above $64,000 up to $120,000. There is no partial supplemental coverage.

Employer Requirements

Employers cannot contribute any portion of the supplemental ICI premium; the employee must pay the entire premium for the supplemental coverage. Supplemental ICI coverage premiums may not be paid under any union contract agreement for State or Local employers participating in the ICI plans.

Employers are responsible for identifying those employees eligible to enroll in supplemental coverage during the initial enrollment period as well as at subsequent enrollment opportunities.

Later this month, you will receive an employer bulletin with:

    1. A sample letter to announce this supplemental coverage to eligible employees;
    2. Enrollment instructions;
    3. Revised premium remittance reports;
    4. Instructions for completing the revised ICI coverage reports to reflect those employees who elect supplemental ICI coverage.

Note: Revised ICI Enrollment Applications

ETF is revising the ICI enrollment application to accommodate supplemental coverage. There will be one ICI enrollment application for local government employees (ET-2366) and one enrollment application for state employees (ET-2307). Revised applications will not be available until after the annual deferred enrollment period to avoid confusion with the initial open enrollment period for the ICI supplemental coverage.

NOTE: Please complete the attached form indicating the initial quantity of ICI enrollment applications you wish to receive. Consider the number of employees expected to be eligible to enroll in the supplemental coverage during the open enrollment as well as the need for applications for new employees in the next year. Mail, fax, or e-mail the form to Broadspire, the ICI third-party administrator. (Contact information listed on the form.)

Premiums for Supplemental Coverage

The Supplemental ICI premium tables are attached. Please note that the tables have been updated to reflect the ICI premiums with the ICI plan paying on the basis of 30 days per month or 2.143 weeks per month.

Questions concerning Supplemental ICI coverage may be directed to the Employer Communications Center at (608) 264-7900.