ARIZONA STATE SENATE
Forty-eighth Legislature, First Regular Session
FINAL AMENDED
FACT SHEET FOR H.B. 2145
ASRS; long-term disability amendments
Purpose
Modifies eligibility and income offsets for the Long-term Disability (LTD) Program within the Arizona State Retirement System (ASRS).
Background
Members of ASRS who are injured and cannot complete work-related duties may be eligible for the LTD Program. The LTD Program benefits begin after six consecutive months from the onset of a disability and continue until the member is no longer considered disabled or has reached normal retirement age. LTD payments equal up to two-thirds of the member’s monthly compensation and are currently offset (reduced) by a number of factors, including 64 percent of social security disability benefits and 83 percent of social security retirement benefits. Members are ineligible for payments from the LTD Program if the disability is a result of an intentional self-inflicted injury, war, an injury incurred during a felonious criminal act or an injury or sickness for which the member received medical treatment within three months of membership in the LTD Program.
There is a positive impact to the LTD Fund as a result of this legislation. According to ASRS, this should result in lower employee and employer contribution rates.
Provisions
1. Increases LTD benefit offsets for disabilities commencing on or after July 1, 2008, in the following manner:
a) by 85 percent of any social security disability benefits received by the member.
b) by 85 percent of any social security retirement benefits received by the member.
2. Excludes from the calculation of any LTD offset, commencing after July 1, 2008, reasonable fees paid to an attorney to secure the disability benefits and any cost of living adjustments granted to the member after the commencement of LTD benefits.
3. Increases, from three months to six months, the preexisting condition exclusion to receive LTD benefits for disabilities commencing after July 1, 2008.
4. Requires ASRS to recover any overpayment of monies from LTD Program benefits by reducing future pension or LTD payments to the overpaid member.
5. Makes technical and conforming changes.
6. Becomes effective on the general effective date, with a delayed effective date as noted.
Amendments Adopted by Committee
· Makes technical changes.
Amendments Adopted by the Committee of the Whole
· Changes LTD benefit offsets for disabilities commencing on or after July 1, 2008, from 100 percent to 85 percent of any social security disability or retirement benefits.
House Action Senate Action
PIR 1/22/07 DPA 7-1-1-1 FIIR 3/19/07 DPA 2-1-2-0
3rd Read 2/26/07 38-21-1-0 3rd Read 4/10/07 28-0-2-0
Final Read 4/18/07 58-0-2-0
Signed by the Governor 4/24/07
Chapter 114
Prepared by Senate Research
May 22, 2007
BR/ac