Month: April 2023

The new approved amount for the non-Medicare health subsidy maximum is $2,169.79 per month, effective July 1, 2023.

On April 6, 2023, the Board of Fire and Police Pension Commissioners approved a 6.0% increase to the non-Medicare health subsidy. With the increase to the non-Medicare health subsidy, many retired members under age 65 will experience lower out-of-pocket costs. In fact, the maximum subsidy will fully subsidize all LAFRA, LAPRA, or UFLAC single-party and two-party non-Medicare plan premiums, as well as some family plan coverage levels for members with a non-frozen subsidy and at least 25 years of service.

Each year, the Board has the authority to increase the non-Medicare subsidy by up to the lesser of 7% or the actuarial medical trend rate for the upcoming fiscal year. The non-Medicare actuarial medical trend rate applicable to fiscal year 2023-2024 is 7.25%, therefore the Board had the authority to increase the subsidy by up to 7% this year. The approved 6.0% increase is consistent with the Board’s fiduciary duty to all members. The Board considered the following information that would potentially affect members:

• Impact to out-of-pocket premium costs for non-Medicare subsidy eligible retirees;
• Impact to retirees in multi-party Medicare plans; and
• Average premium changes among most eligible plans.

Do I qualify to receive the non-Medicare subsidy?

The actual increase in subsidy benefit per member is dependent upon eligibility and the retiree’s respective health plan premium. The approved increase to the maximum non-Medicare subsidy provides fully subsidized single- and two-party coverage for all eligible pensioners with 25+ years of service. Qualified survivors who are under the age of 65 and pensioners who are enrolled in a Board-approved HMO or PPO single-party Medicare health plan are not impacted by the maximum non-Medicare subsidy increase.

If you have questions or need more information regarding the non-Medicare Health Subsidy increase, please contact Medical & Dental Benefits at (213) 279-3115 or via email at mdb@lafpp.com.

APRIL 11, 2023

The Cost of Living Adjustment (COLA) is 5.1% for 2023 and was approved by the Board of Fire and Police Pension Commissioners on April 6, 2023.

The COLA will be effective July 1, 2023, and all eligible pensioners and Deferred Retirement Option Plan (DROP) participants will receive an increase accordingly, beginning with the pension payment/DROP account deposit dated July 31, 2023.

• Tiers 1 & 2 retirees and beneficiaries will receive 5.1%. Tier 2 DROP participants will receive 3.0%.
• Tiers 3 & 4 retirees, beneficiaries, and DROP participants will receive up to 3.0%.
• Tiers 5 & 6 retirees, beneficiaries, and DROP participants will receive up to 3.0% and the remaining 2.1% will be stored in the COLA bank*, which can be applied in future years when the CPI is below 3%.

For new pensioners and DROP entrants in Tiers 3-6, the first year’s COLA is prorated based on the number of complete months since the pension effective date, therefore these members may not receive the full 3.0%.

*Must have retired or entered DROP with a pension effective date prior to June 2, 2023, in order to have an available COLA bank balance.