Health and Life Insurance, Administration

Canon XX.

Resolved, that Canon XX be amended as follows (deletions in bold strikethrough text and insertions in bold italic text):

Sec. 20.01. Group Coverage.

The Diocese shall provide group coverage for medical benefits through the Denominational Health Plan of the Episcopal Church Medical Trust; dental benefits; long-term disability benefits; term life insurance benefits; and such other benefit programs as the Personnel Practices Committee Executive Council may approve with the consent advice of the Finance Committee.

Sec. 20.02. Eligibility.

The following persons, and their immediate family dependents, are eligible for coverage, and premiums shall be paid as specified:

  1. Every active Cleric who is personally resident within the Diocese, and scheduled to work a minimum of 30 hours weekly (equivalent to 1,500 hours annually) in the general work of The Episcopal Church in this Diocese; premiums for such insurance to be paid by the source of the Cleric’s salary;
  2. Members of religious orders and Clerics on leave of absence authorized by the Bishop for a specific period of time; premiums to be paid by the source of ecclesiastical salary, or as directed by the Bishop;
  3. Every retired Cleric who shall have attained age 65 and who shall have been Canonically Resident in this Diocese and regularly employed full time in the general work of the Diocese for the five years immediately preceding retirement, and who has ten years of credited service with the Church Pension Fund; premiums to be paid by the Diocese;
  4. All regular, lay employees of the Diocese, of the Cathedral, parishes and missions and other ecclesiastical organizations or bodies subject to the authority of The Episcopal Church and scheduled to work a minimum of 30 hours weekly (equivalent to 1,500 hours annually): premiums to be paid by the source of salary or the employing entity;
  5. Other employees of parish and Diocesan Institutions that elect to participate upon such terms as may be approved by the insurer as to the employees covered and the source of the premium payments.

Sec. 20.03. Mandatory Participation.

Each of the persons described in Section 20.02 shall be covered for all coverages available under the group plans listed in Section 20.01 of this Canon to the extent required by each such plan unless the person elects to opt out as permitted under the rules of the Episcopal Church Medical Trust or relevant plan documents. The source of salary shall not be required to pay that portion, if any, of the premium specified for voluntary life insurance under the group life plan. If the Diocese provides more than one health or dental benefit plan, the source of salary shall be obligated to pay no more than the cost of the least expensive plan, but may require Clerics and lay employees to pay the difference if they elect a more expensive plan. For retired Clerics who are eligible for Medicare, the Diocese shall be obligated to pay no more than the cost of the least expensive Medicare supplement plan available from the Episcopal Church Medical Trust, less the amount of any subsidy available from the Church Pension Fund.

Sec. 20.04. Voluntary Participation.

  1. Upon individual application, any Cleric and his or her immediate family dependents may participate effective as of the date of Canonical Residence in the Diocese, and upon payment of the applicable premium. Any Cleric and immediate family dependent eligible may, in the event of change of classification, continue coverage upon payment of applicable premiums so long as canonical residence is maintained.
  2. For purposes of this Canon, immediate family dependents shall include domestic partners registered with the State of California and their legal dependents, provided that an eligible Cleric or employee complies with the requirements of the their employer’s Personnel Manual.
  3. The Convention Executive Council may, by resolution, establish a minimum required employer cost-sharing policy for benefits for the dependents of any Cleric or lay employee, so long as the policy provides parity for medical benefits for all clergy and lay employees who are scheduled to work a minimum of 30 hours weekly (equivalent to 1,500 hours annually). The source of salary may elect to pay more than the minimum so long as it maintains parity for clergy and lay employees.
  4. The Diocese shall pay a Medicare supplement subsidy for the spouse or surviving spouse of a retired Cleric only for the least expensive Medicare supplement plan, as determined by the Executive Council, and only if the spouse is an “eligible spouse” or “eligible surviving spouse” under the eligibility rules of the Church Pension Fund and/or the Episcopal Church Medical Trust. Any such subsidy shall be reduced by the amount of any subsidy available from the Church Pension Fund. However, the Diocese shall continue to provide coverage to any spouse or surviving spouse of a retired Cleric who was receiving health benefits as of October 26, 2013, notwithstanding any lack of eligibility under those rules.
  5. Resolutions modifying benefits policy under the provisions of this Canon XX, shall be adopted by the Executive Council only after having
    1. posted notice of the proposed resolution on the diocesan web site for at least four months,
    2. mailed notice of the proposed resolution to all affected clerics and lay employees at least four months in advance,
    3. provided opportunity for the deaneries to meet in convocation to consider the proposed resolution and provide feedback to the Executive Council,
    4. held public hearings on dates and times and at places identified in the aforesaid notices.

Sec. 20.05. Administration.

The group health and life insurance plans shall be administered under the supervision of the Finance Committee, which shall have authority to grant exceptions for good cause when the terms of a particular plan so permit. The Finance Committee shall review and update plans and recommend to Executive Council such modifications of coverage, terms and benefits as may be appropriate.

Sec. 20.06. Salary Continuation Benefits.

The Diocese shall provide, to lay and Clerical employees working 20 hours or more per week and continuously employed for a minimum of 90 days, a salary continuation benefits program similar to the State Unemployment Insurance Program for the benefit of those employees whose employment within the Diocese of California is discontinued for reasons beyond the control of such employee. The terms and conditions of eligibility for such coverage and the benefits provided shall be determined and administered by the Personnel Practices Committee Executive Council under such rules and regulations as they may from time to time adopt, amend or modify, consistent with sound actuarial practice. The Personnel Practices Committee is authorized to determine and to recommend to Convention not less than 60 days prior to Convention the level of benefits and the assessment upon employers necessary to fund such benefits on a sound actuarial basis.

Sec. 20.07. Lay Pensions.

All regular lay employees of the Diocese, the Cathedral, parishes, missions, or other ecclesiastical bodies subject to the authority of The Episcopal Church and scheduled to work a minimum of 20 hours weekly (equivalent to 1,000 hours annually) shall be eligible to participate in the Lay Employee Pension System administered by the Church Pension Fund. The employer shall contribute not less than five (5) percent of the employee’s compensation and match at least four (4) percent of the employee’s contributions, such benefit to be paid by the source of salary.

Proponent’s Explanation:

Canon XX currently specifies in considerable detail the benefit programs and coverage levels to be offered by congregations and diocesan institutions.  They can be changed only by canon amendment approved by convention, an extremely cumbersome method. This makes it difficult to address the rising cost of benefits for current employees.  It seems likely that the medical insurance marketplace will continue to see a lot of change in coming years and the diocese will be unable to respond incrementally as circumstances require in future years if canon amendments at convention remain the mechanism for adjusting benefits.  An alternative would be to follow the example of many other dioceses by giving that responsibility to the Executive Council and Finance Committee.

The Executive Council sought the advice of the diocesan Committee on Governance.  That committee had already identified a group of 20 dioceses of The Episcopal Church that they regard as “benchmark dioceses” for various reasons.  The members of the Committee on Governance inquired of the benchmark dioceses regarding the matters upon which Canon XX touches.  They received responses from 15 dioceses.  They found that for two-thirds of the responders, final decisions regarding benefits are made by the equivalent of a finance committee or executive council.  The Committee on Governance noted that “there is a tendency in the Diocese of California to specify by canon what other dioceses specify by policy.”

Not only is it cumbersome to manage benefits policy by canon or convention resolution, it does not allow for a full and open discussion of the issues involved.  Because of the press of business at convention, the Committee on Dispatch of Business is typically able to allot only 15 minutes for floor discussion of a resolution or canon change.  The Executive Council seeks to establish a new decision process based on the following principles:

  1. Reasonable notice to all stakeholders (four months).
  2. Involvement of the deanery convocations.
  3. Open hearings which could be attended by all interested parties.
  4. Final decision by a body of elected representatives (Executive Council).

The Executive Council believes that this new process will not only allow the diocese to respond with greater agility to changes in the benefits landscape, but will also do so in a manner that is consistent with our commitment to transparent leadership and that honors the people we serve.

This proposal also makes minor adjustments to Sections 20.03 and 20.04(b) to reflect current practice.

Proposed amendments to Sections 20.01 and 20.06 in this resolution are identical to those proposed in a separate resolution removing the Personnel Practices Committee from the canons of the diocese. In the event that other resolution is adopted, Sections 20.01 and 20.06 will be considered amended regardless of whether this resolution is adopted or not.

Another separate resolution proposes removing specification of retiree benefits from the canons.  In the event that other resolution is adopted, Section 20.04(d) would be considered deleted rather than amended.

Submitted by:  The Executive Council: Lane Ringlee, Chair,; Christopher Hayes, Chancellor,

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