Board of Pensions announces two-step dues increase

1.5% hike over two years is first Medical Plan raise in five years

July 15, 2011


For the first time in five years, the Presbyterian Church (U.S.A.) Board of Pensions’ (BOP) Medical Plan dues are going up.

At it’s June 23-25 meeting here, the board voted to raise Medical Plan dues by three-quarters of a percentage point in each of the next two years. Thus, dues will rise from 19.5 percent to 20.25 percent in 2012 and to 21 percent in 2013.

Michael Fallon, the BOP’s vice-president for finance, told the board June 25 that Medical Plan reserves at the end of 2011 are projected to be above the 20-33 percent [of current year claims and expenses] range that is the BOP’s guideline for such reserves. “But without changes,” he said, the reserve level will drop below the 20 percent bottom of the range by 2012 and below zero by the end of 2013.”

The two-step dues increase “…spreads the pain,” said BOP director Alan Ford. BOP director Paul Volker, a physician, agreed. “I appreciate the two-year phase-in,” he said. “It  helps churches with their planning.”

The Rev. Brian Ellison, a board member who also serves on its Healthcare Committee said, “I want to counter any misperception that any healthcare increases are related to domestic partner benefits. We must go out of our way to reinforce the message that this has nothing to do with domestic partner benefits but reflects healthcare costs and healthcare costs only.”

It also helps the board avoid possible confusion by not announcing a 1 percent dues increase at a time when it is considering a request from the 219th General Assembly to explore extending benefits to same-gender domestic partners. The Assembly authorized the board to raise Pension Plan dues by 1 percent if necessary to fund such an expansion.

The dues increase was part of a package of changes to the Medical Plan the board approved as it prepares for the full rollout of federal health care reform in 2014.

Vice-President for Benefits Patricia Haines said she’s confident that as many as two-thirds of Medical Plan members will likely qualify for some kind of government subsidy under the state-based health insurance exchange system created by the reform legislation, “so wholesale changes to our plan don’t make sense right now.”

In the meantime, the package of Medical Plan changes include (in addition to the dues increase):

  • An increase in the minimum Medical Plan dues basis ― currently 65 percent of the median salary for pastors in the church, or $34,385 ― to a flat dollar amount of $38,000 in 2012 and $40,000 in 2013;
  • An increase in the maximum Medical Plan dues basis ― currently 200 percent of the pastors median, or $105,800 ― to a flat dollar amount of $117,000 in 2012 and $124,000 in 2013;
  • An increase in the annual deductible, effective Jan. 1, 2012, from 1 percent to 1.25 percent of effective salary for in-network services and from 2 percent to 2.50 percent of effective salary for out-of-network services
  • An increase in the in-network office co-pay for specialists from $35 to $45, effective Jan. 1, 2012 (the primary care physician office co-pay remains unchanged at $25);
  • Effective Jan. 1, 2013, an increase in the annual family co-payment maximum from 4 percent to 5 percent of effective salary for in-network and from 12 percent to 15 percent for out-of-network.

Seminary student dues are also going up, commensurate with the raise in the minimum dues basis for active plan members. For instance, member only coverage will increase from $318.06 monthly currently to $364.17 in 2012 and to $396.67 in 2013. For member and family, coverage will rise from the current $558.75 per month to $641.25 in 2012 and to $700.00 in 2013

Monthly subscription dues for the Affiliated Benefits Program and for early retirees ― excluding Medicare Supplement subscribers ― will go up 7 percent on Jan. 1, 2012.

The board authorized staff to report back in October on the Medicare Supplement subscription charge for 2012, with the stipulation that “any increase not exceed $10 per member per month.” Haines said that a 2012 financing change to the prescription drug portion of the Medicare Supplement Plan allows the BOP to receive larger subsidies from the federal government than in the past, “which should help slow the rate of increase in Medicare Supplement dues.”

In other news, the board:

  • Heard a report from its Investment Committee that the BOP’s Balanced Investment Portfolio increased 6.5 percent to $7.3 billion for the five months ended May 31, 2011. The Pension Plan remains fully funded;

Voted to discontinue the Middle Governing Body Grant Program pilot offered through the board’s Assistance Program. “The Assistance Program’s other grant programs are currently adequately funded. However, increased Christmas Joy Offering income or other new gifts are necessary to meet the financial assistance needs of Presbyterian pastors, other church workers, and their families in the future,” said the Rev. Peter Sime, the BOP’s vice-president for assistance, CREDO program and funds development.

  1. I come from a family of Christ followers, many of whom have worked in and some of whom still work as disciples of Christ. When I spoke to one of the retiring pastors of the PC in regard to this situation, my heart dropped to my stomach. I researched the BOP proposal, although it sounds like a done deal and have been trying to reach the BOP to discuss this issue from a professional health advisor standpoint as well as a Christ follower and a concerned individual for both the persons being affected by this situation and with concern to the PC organization as a whole for its future. There is a win-win here we just need them to listen and understand this is not a done deal. My example is this; the pastor and his wife will benefit in the amount of about $6,400.00 per year with better coverage than the BOP is offering. I truly believe that the BOP has no idea of as to the impact there decision will have on the PC (USA). They have yet to see the flood of calls, letters, blogs, picots, etc. that this could cause them, when there are avenues, such as I am willing to propose. If anyone can help with this effort, please contact me at

    by Gary Anderson

    January 30, 2013

  2. It doesn't matter whether the 1% increase is due to the inclusion of domestic partner benefits which the Board seems so edgy about or other factors, it remains that churches cannot continue to exist with ever increasing cost-share. It just puts more small churches beyond the pale of being able to employ a pastor. The other factor is the ever declining base of support especially now with the possibility of nearly 1/10th of the PC(USA) churches leaving the denomination. The fact is the "great benefits we receive from the BOP" is killing the golden goose that has to lay the eggs!

    by William M Clark

    May 2, 2012

  3. As to a universal healthcare plan as other "civilized countries" have, how would we like what Canada has? My cousin's exact words were, "It's terrible up here, Bud. People are dying all around us because they have to wait many months to even get a CT scan to confirm suspicions of cancer." How civilized is that? How's that for justice? We are groping for a utopia that is an illusion.

    by Eugen Bach

    February 10, 2012

  4. I am a retired Army Chaplain with a better than PCUSA retirement and a better than BCBS medical plan. I am more than willing to withdraw from both if that would help reduce the cost to my church. But unfortunately, though I have requested such, my request has been denied by the Board of Pensions.

    by Alan Buckner

    October 5, 2011

  5. How does this affect retired clergy?

    by Rev. Harvey Oster

    August 12, 2011

  6. Not surprising since we do not have the political will and sense of justice for all to work toward a universal healthcare system like other civilized countries in the world have. Healthcare is a human right - should be a "no brainer" for people trying to be Christians.

    by Mrs. Rev. Stephen (Joan Huenemann) Michie

    July 22, 2011

  7. This is all based on the media salary for ministers. How does this affect retired certified church educators? In all your publications, please remember all the dedicated educators who faithfully serve the church. Most educators' salary is only about half that of the ministers and that is one reason why so many who are called to the ministry of education are now applying to seminary but still plan to serve in the education ministry. Please do not forget us!!!!!!!!!!

    by Patricia A. Broom

    July 18, 2011