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Arizona State University

Update: COBRA, RASL

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So yesterday I reported on the flap that arose over the COBRA discount, in which one of GDU’s sterling HR representatives told me that staying on the payroll until December 31 would make me ineligible for the discount on COBRA mandated under ARRAS, the federal stimulus plan. This would mean my health insurance premiums would jump from $26 to over six hundred bucks a month. Even with the discount, the cost will rise to $186, but since I’ll be paying more than that for Medicare, it almost looks affordable.

Not, of course, with almost zero income, but I’ll just have to forego food and other necessities, since at my age I can’t risk going without health insurance.

Well, the story gets better.

I managed to find an e-mail address for an actual human being at the downtown state employee benefits office, taking me outside GDU’s purview. Off went a query:

If my employment with the Great Desert University ends on December 31, will I be eligible for the discounted COBRA?

Here is the reason that I am asking this question:

The federal rule on COBRA premium assistance, posted at www.irs.gov/pup/irs-drop/n-09-27.pdf, says a person is eligible…

(1) who is a qualified beneficiary as the result of an involuntary termination during the period from September 1, 2008, through December 31, 2009, (2) who is eligible for COBRA continuation coverage at any time during that period, and (3) who elects the coverage.

However, at GDU’s “frequently asked questions about COBRA premium assistance” page, this wording appears:

Who is eligible for premium assistance?

A person is eligible for premium assistance if and only if:

He/she is eligible for COBRA coverage between September 1, 2008 and December 31, 2009

AND

The qualifying event that makes him/her eligible for COBRA coverage is a covered employee’s employment being involuntarily terminated between September 1 2008 and December 31, 2009.

The HR rep with whom I spoke yesterday told me that the first bulleted  point, saying you must be “eligible for COBRA coverage between September 1, 2008 and December 31, 2009” means that if I am on the payroll on December 31, that will disqualify me from eligibility for the COBRA premium assistance BECAUSE my health care plan will remain in effect on that day, and so, because I will still be covered by my plan on December 31, I will not be “eligible” for COBRA until the next day, January 1, and therefore will miss the deadline. She believes that as long as your plan is in force, by definition you’re not eligible for COBRA—you have to have been thrown off your plan to be eligible. That is, she is saying that as long as your health care plan still covers you, you are not eligible for COBRA and therefore if you are still on the payroll on December 31, you are not eligible for the COBRA discount.

Is that true?

The way I read the federal rule published on the IRS site, it looks like “eligible for COBRA continuation coverage” means only that you are enrolled in an employer’s health plan and that you are involuntarily terminated between 9/1/08 and 12/31/09. Is simply being covered by your health care plan on the day you are involuntarily terminated enough to disqualify you from the discount, if your termination date is December 31?

Thus I need answers to two questions:

1. Is it true that if I am terminated involuntarily on December 31, 2009, I will not be eligible for the COBRA premium assistance? and

2. If it is true that termination on December 31 will make me ineligible for the COBRA discount, will a termination date of December 30 leave me eligible for the premium assistance?

Thank you for any clarification you can offer. I would like confirmation of the answer in writing, since no one at GDU seems to be certain of these policies.

Shortly, along came this startlingly literate response:

Hello,

Anybody terminated involuntarily between 9/30/08 and 12/31/09 are  all included in the Stimulas.

Thank you,

[the correspondent’s name & position]

{Sigh} I don’t know whether to take the word of a person who thinks that “anybody…are” and who can’t spell or punctuate stimulus. But at least now I have something in writing to support my interpretation of the law.

Ah, but it didn’t end there. Yesterday, the story got even better!

To be eligible for the state’s payout for accumulated sick leave (RASL), you have to be officially considered “retired.” Since I’ve worked at GDU since the early Pleistocene, this benefit amounts to about $20,000 for me, to be paid out in three annual installments.

The way I understand it, this means you make an official statement that you are retiring (and you have to do this within two weeks of your termination day) and you start drawing down from the state retirement system or from your 403(b), whichever you’re in.

As usual making an exception of myself, I want to roll over the $130,000 or so that has accumulated in this plan into my large IRA, which is professionally managed. I’d like to do this a) for the sake of simplicity (fewer statements to handle, fewer bureaucrats to deal with) and b) so that all my money is managed by the same financial management firm.

In connection with this strategy, I’ve been told that to be considered a GDU retiree, you have to leave a small amount in your 403(b) fund. Although you can roll over most of the money, there’s some minimum amount you have to leave in the state’s custody. What that minimum is remains a mystery.

So while I was at the HR office receiving incorrect information about the timing of the ARRAS eligibility, I asked the same font of wisdom if she could tell me what is the minimum that has to stay in the 403(b) to maintain one’s status as a “retiree.”

Well, of course she hadn’t the faintest. She’d never heard of such a thing.

She advised me to call the RASL director at the General Accounting Office to ask about this. I’ve been in touch with this woman before, and in the past she’s been very helpful—she was the one who advised me that the story La Maya and I each heard from HR office on two separate GDU campuses, to the effect that if you’re laid off you’re not eligible for RASL, was wrong.

By the time I reached her the following day, I’d about figured out that everything the HR rep had said about COBRA was just so much B.S., and so I’ll admit there probably was an edge in my voice.

When I asked her what was this “minimum amount” I’d been told had to stay in my 403(b) account, she completely went off on me.

She said that if I rolled my money out of my 403(b) into my own IRA, that would “obviously” mean I was not retired and therefore I could not have the $20,000 the state owes me for back sick leave pay.

I asked her to please define what is meant by “retire,” since I didn’t understand how rolling money out of a 403(b) into another tax-deferred plan would cause you to not be retired. She could not or would not respond to that question, but instead informed me flatly that if I rolled anything out of my 403(b), she would send me a letter rejecting my application for RASL. She started yelling at me (!) that “you can’t have everything you want.” I was so nonplussed it didn’t occur to me to say I’m not asking for everything; all I’m asking for is what I’ve earned over the past 15 years of working 14-hour days, 7 days a week with no overtime.

She then demanded that I call Fidelity and TIAA-CREF, where my 403(b) funds reside, with any further questions. She said they had “hundreds” of representatives who have had experience with this issue and could confirm what she said.

It took an hour and a half to get through the punch-a-button mazes to reach humans at those two worthy organizations. TIAA-CREF has disconnected the line that used to reach a person, so that now all of its published telephone numbers take you to a barricade between its employees and the Great Unwashed. Finally I got a call from a guy I reached through an e-mail form on their website.

At Fidelity, the CSR and his manager had never heard of any such rule. They both said they couldn’t imagine how rolling your money from one tax-deferred fund into another tax-deferred fund would magically make you “not retired.” The manager suggested that the way to get around this crazy woman would be simply to make a small drawdown, as though I were going to take out payments to live on, until such time as she approved the RASL and the first payment hit my account. Then, he suggested, just go ahead and do the rollover. Once she’d approved the RASL, there would be nothing she could do.

He also suggested simply rolling over the first distribution into my IRA. He said there’s no rule prohibiting you from making a roll-over, and although Fidelity has to confirm with GDU that the person requesting a distribution actually is “retired,” there’s no way the GAO woman was going to know where the distribution goes.

At TIAA-CREF, the CSR was amazed and said he also had never heard of any such thing. He said, however, that when the request for confirmation of retirement status goes through to GDU, the form used to make that request does say where the distribution is going. So, he concluded, this woman would be able to see whether I was having the money put into my checking account or whether it was being rolled into another tax-deferred instrument. He recommended taking a minimum distribution, paying the taxes on it, and depositing the remainder into my Roth IRA.

This will mean I can’t consolidate my money from three tax-deferred instruments to one for at least three months after I leave GDU. It takes that long after the demented woman at GAO approves your status as a retiree and gives the go-ahead for the RASL payment for the first of the three annual installments to be disbursed. Since I probably am going to have to make drawdowns from savings to survive, this is going to add to the hassle factor immeasurably.

What a flicking nightmare.

Another fun day at Human Resources

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It’s probably my mistake. Most things are. Whatever, when I showed up yesterday morning at Human Resources for the required meeting for exiting retirees, I was told that the meeting wasn’t yesterday; it was Wednesday.

Now, I would swear the woman who made the appointment for me was on the phone when I had the calendar in hand, and that I said, as I always do, “Let me confirm that…” But maybe not. Maybe I wrote it down on Thursday and just imagined I entered it on Wednesday.

This created a double inconvenience: The pointless 44-mile round-trip trudge out there (where I have nothing to do other than pack up some more of my junk and haul it out to the car), and then, because they sent a packet of information through the campus mail, another pointless round trip in the next day or two to pick that up.

Swallowing my fury, I remarked to the woman at the reception desk that I had some questions that I haven’t been able to get answered. In the conversation that ensued, it developed that she was the very person who had made this pointless appointment for me—and, we may add, so far the only one who seems to have made some sense over the telephone. She was sitting at the front desk because, thanks to the layoffs, they’re so short-handed they don’t have enough staff to run the office properly. At any rate, she offered to answer said questions.

You understand: in dealing with HR what you get is a passel of information that you already know. Whatever they tell you is a) boilerplate and b) already on their website. But when you have a real question, one that isn’t answered on their website, they don’t know the answer. Consequently, they either tell you they don’t know and they don’t really know where you can find out, or they give you an answer that’s wrong.

For example, the last time I was out there (and I do mean out: HR’s offices are way to the south of the huge campus. It’s too far away to walk, and the parking lot is permit-only, so that employees have to pay to park there or take a chance on getting a whopping ticket)…the last time I was out there, I was told that the proposed December 31 canning day would get me in under the wire for the discounted COBRA.

Without the discount on COBRA, my health insurance premium will jump from $26 a month to something over $600. With it, the premium will be somewhat less than Medicare, around $185. Not really affordable, but at least attainable, more or less.

Yesterday the HR lady read the rules for the discounted COBRA closely (isn’t that a quaint idea?) and concluded that what I’d been told was wrong. My benefits actually have to have stopped before the 31st. So, she proposed, I need to ask the Dean’s office to can me significantly sooner. She suggested the 11th—arbitrarily, because some other disgruntled retiree had chosen that day at yesterday’s meeting.

I informed her that Social Security will not deliver a benefit check before the middle of February, even though it “starts” (snark!!) in January, and that they refused to “start” it in December so that I can get some money in my bank account in January, because I’m earning a salary in December that would trigger the 50 percent penalty for working while drawing SS. I pointed out that I will have a difficult enough time living for a month and a half with no income, and that there’s no way I can manage that for something like two months.

Then she decided I probably could get away with it by having them can me on the 27th, the date of the last paycheck of the month. But, she said, I’ll have to get the Dean’s office a) to do that (meaning I have to get that bureaucracy off the dime) and b) I have to get those people to state that I’m being terminated involuntarily (even though in fact what’s happening is they’ve arranged to have my contract stop then, and it’s entirely possible the government will argue that not renewing a contract is different from firing a regular worker).

Then I asked how I get my money out of the 403(b) plans to roll it into my IRA. She didn’t know. She said I had to call Fidelity and TIAA-Cref, and she did not know how to reach a human being at either outfit.

So I asked what is the minimum amount I’m required to leave in the plan in order to be regarded as “retired” over the next three years so that I can get my accrued sick leave payments, which are doled out over a three-year period. She didn’t know. She said I needed to call the state’s general accounting office.

I asked if benefits are taken out of our vacation pay, and if so, did that mean my health care insurance would be extended over the month or so of time for which GDU owes me. She said she believed that the health insurance stopped on the termination day, but she wasn’t sure. She called a payroll clerk up to the front, to discuss this question.

That woman said that the only thing that was taken out of back vacation pay was state and federal taxes, but that the federal tax bite would be 25 percent, and that your benefits stop on the day you are terminated. I asked why the tax rate was so high. She said that was just the rules. Then she said the state tax deduction would be over 30 percent, because that’s what I put on my A-4 form. (I did? Well, that explains why I keep getting such large state tax refunds). I said that would mean they would be grabbing over half my pay!

She said no, by “30 percent” she meant the state takes 30 percent of the federal tax. Then she said it was possible to elect a slightly smaller bite. I said I would like to do that. So she produced a new A-4, which is the same as a W-4 only for the state of Arizona. The lowest amount I could select was 21.1 percent.

By the time I walked out of there, steam was shooting out of my ears.

These developments—assuming they’re true—represent substantial more hassle, substantial more uncertainty, and four fewer days of pay: $960 less than I thought I would get!!!!!

The bright spot is that I’ll net a little more in vacation pay than the $3186 I expected: $3670. Not much—$486 less than the $960 I’ll lose by moving my termination day forward—but better than yet another hit on the head.

Moving on, I tried to contact the college’s business office manager, cc-ing my dean, and was told that she’s out until next Monday. So now all this complicated mess has to hang fire until then, and then hang fire still longer until she gets around to answering me. By then I will have forgotten some of the details and also will be engaged in dealing with other messes.

Today, whenever it gets to be business hours, I’ve got to track down the woman I found at GAO and find out just how little cash I’m allowed to leave in the 403(b) without losing my RASL payment.

Then, somewhere, somehow (I have no idea where or how) I’ve got to find someone who understands enough about COBRA to confirm or deconfirm whether I really have to sacrifice $960 of pay in order to keep my health insurance premiums in a range that I can even remotely afford to pay.

What I don’t understand is that, assuming the HR lady is right in thinking I have to be off the payroll before December 31 because my benefits would extend to that day, why can’t I be canned on December 30, thereby losing only $240 worth of pay? The rule says “eligible for COBRA” and the last day on which you may have been canned is the 31st.

She interprets “eligible for COBRA” as meaning not only that you were canned involuntarily but that your benefits have stopped. In her view, because my benefits would still be in force on the 31st, and because GDU will have to not pay me for the extra four days after the December 27 payday until the first payday in January 2010, those two things together will make me ineligible for the discount. I don’t think so: I think the rule says you may have been canned as late as the 31st. If she’s right that hanging onto my job until the 31st makes me ineligible for the discount but letting them can me on the 27th makes me eligible, then by that reasoning (if “reasoning” it can be called), I should still be eligible on the 30th. IMHO, I should be eligible on the 31st, but I’m willing to forego $240 (less tax, less benefits, less every other gouge GDU can think of) to keep my insurance premiums “down” to a mere $186 a month.

So far, I’ve been unable to find anyone, anywhere who can explain this rule. Most of the HR people barely know it exists at all, and they certainly don’t understand its fine points.

Jayzus Aitch Keerist on a crutch! Is it any wonder I’m grinding my teeth until they break?

GDU Defends Status as Champion Laughingstock of North America

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LOL! You have to be here to appreciate how ludicrously typical this is. Colleagues are still hooting with ecstatic hilarity (heaven knows we have little enough to laugh at around that place) over columnist Gail Collins’s choice words:

Obama’s round of spring events will culminate in appearances at graduation ceremonies in Notre Dame (where the local bishop is ticked off about the abortion thing) and Arizona State University, where he is not going to receive an honorary degree. A spokeswoman for the university explained that it was withholding that honor from the president because “his body of work is yet to come.”

Tough standards, A.S.U.!

Snark! Gasp…catch your breath, pick yourself up off the floor, and tool on over to CNN, where Our Beloved Employer’s p.r. staff can be seen digging us in even deeper:

The university says that the president’s achievements have yet to rate the honor, and is directing reporters to use a statement given to the Associated Press. “His body of work is yet to come. That’s why we’re not recognizing him with a degree at the beginning of his presidency,” Media Relations Director Sharon Keller told the AP Thursday.

The university’s guidelines say the degree is merited by “significant contributions to education and society over the course of a person’s career,” though Sandra Day O’Connor and Barry Goldwater — both Arizonans — received the honor after the latter had served just over one term in the Senate, and the former was roughly three years into her Supreme Court tenure. Also honored: activist Cesar Chavez, legendary Arizona senator and former presidential candidate Mo Udall, and broadcaster Walter Cronkite.

Here in the blogosphere, one wit notes that the Great Desert University adjudges Erma Bombeck’s opus sufficient to merit an honorary degree, to say nothing of Jerry Colangelo’s and Steve Allen’s. Backs against the wall, administrators personfully stick with their decision to withhold an honorary degree from the President of the United States but instead will name a scholarship after him.

Mighty white of ’em, eh?

Meanwhile, the highly educated products of our elite institution, patriotic young entrepreneurs steeped in the significance of their nation’s history and place in the world, have made themselves busy peddling their tickets to the graduation ceremony. Entrée to hear the first African American President of the United States in person comes cheap at the Great Desert University: $60 to $100 a seat.

God, what an embarrassment to be associated with that outfit! How can I count the ways I love the prospect of exiting, pursued by…whatever?
MORE!

Laughingstock Postscript
Funnier and funnier!