Special Incentive Plan Victoria Mulhern Executive Director Faculty

Special Incentive Plan Victoria Mulhern Executive Director, Faculty Affairs and Professional Development Perelman School of Medicine Hilary Lopez Senior Benefits Specialist Human Resources 0

Special Incentive Plan • Effective August 1, 2020 – retroactive to eligible faculty who retired March 1, 2020 and after • Paid out of University EB pool • Eligibility • • Senior members of the Standing Faculty and Standing Faculty—CE • A senior faculty member who retired or has elected to retire under FIAP as of March 1, 2020 or some later date • A senior faculty who is 70 or older and who retired or has elected to retire as of March 1, 2020 or some later date and who was not eligible for FIAP Eligibility requirements • Senior faculty members who, as of June 30, 2021, satisfy the following requirements: • The faculty member is age 60 or older • The faculty member has completed 10 or more years of full-time continuous service; and • The faculty member satisfies the “Rule of 75” (the sum of the faculty member’s age and full-time continuous service equals or exceeds 75) 1

Special Incentive Plan Cash benefits • Equal to the greater of • 200% of the faculty member’s academic base salary OR • 200% of the average academic base salary for professors in the faculty member’s school • Academic base does not include: • Salary earned as an administrative stipend • Paid in 24 equal installments • Subject to federal, state, local, social security, Medicare taxes • If faculty member dies, remaining cash benefits paid in lump sum to surviving spouse or estate 2

Special Incentive Plan Non-cash benefits • • • Medical Benefits Dental Benefits Vision Benefits Group Life Insurance Tuition Benefits Long-Term Care—may continue on a direct bill basis • No contributions to basic or supplemental retirement plans 3

Medical Benefits Examples • Option to defer coverage—one time! • Retiree under 65, spouse over 65 • Retiree chooses from the under 65 medical plan option (may continue on current Penn medical plan) • Calendar year 2021 rate per month -- $255 for Penn. Care/Personal Choice • Spouse must apply for Medicare Part B and chooses from the Medigap Security 65 Premium Plan • Calendar year 2021 rate per month -- $172 4

Special Incentive Plan Applying for Medicare 1 -800 -772 -1213 • Contact 3 months in advance • For yourself and spouse, if applicable • Medicare will send application to your home address • Request for employment information must be completed by Penn HR • No penalties for applying for Medicare Part B after 65 • Premiums for Medicare Part B are based on income 5

Special Incentive Plan Issues to consider: • Use sabbatical credits before retirement. Sabbatical does not extend the start date of the Special Incentive Plan • Employment beyond retirement during the 2 -year period will be no more than 20% of the level of services performed before retirement • PSOM could decide not to accept a faculty member’s election to participate in the plan because the faculty member’s termination would be detrimental to the School 6

Special Incentive Plan Issues to consider (cont’d) • A faculty member must sign and submit a release at the time of election of the plan and a second release on the date of separation • Among the provisions of the release is a covenant not to compete for faculty in the Perelman School of Medicine, the School of Veterinary Medicine, and the School of Dental Medicine 7

Special Incentive Plan Process: • Announcement from the Provost to eligible faculty about the plan • A hard copy letter sent to each eligible faculty member’s home address describing the plan and providing the estimated amount he/she would receive if the faculty member elects the plan • Faculty will discuss options Dean/Chair/Chief, including any employment beyond retirement 8

Special Incentive Plan Process (cont’d): • Faculty who elect the plan will make their benefit elections and sign an irrevocable agreement. • Faculty member must apply during the election window that opens on August 1, 2020 and closes on November 30, 2020 • Date of retirement must be on or before June 30, 2021 • At retirement, faculty appointment is converted to emeritus 9

Your To-Do List • Access and review your Penn records on Workday@Penn. • Home address, email, phone number, beneficiary designations, dependent information • Access and review your Penn retirement plans online and meet with retirement plan representative: TIAA/CREF: www. tiaa-cref. org Vanguard: www. vanguard. com 10

Special Incentive Plan Questions? 11

Contact Information Hilary Lopez, Senior Benefits Specialist hlopez@upenn. edu Victoria Mulhern, Executive Director, FAPD vmulhern@upenn. edu Special Incentive Plan https: //www. hr. upenn. edu/docs/default-source/benefits/special-facultyincentive-plan-guide. pdf? sfvrsn=488 b 9256_8 12