Category: Newsroom

2024 Health and Dental Subsidy Updates

Posted on by Elizabeth Trevizo

On November 2, 2023, the Board of Fire and Police Pension Commissioners approved new maximums for the Medicare health subsidy, the health subsidy for Qualified Surviving Spouses/Domestic Partners, as well as the dental subsidy. These new maximum amounts will be effective January 1, 2024 through December 31, 2024.

Medicare Health Subsidy Benefit

The maximum Medicare Health Subsidy increased to $549.16, effective January 1, 2024. The maximum Medicare Health Subsidy is set at the highest monthly premium of an approved plan supplemental to Part A of Medicare available to retired members of the Los Angeles City Employees’ Retirement System (LACERS), pursuant to the City of Los Angeles Administrative Code Section 4.1154(c).

A Medicare Health Subsidy is provided to eligible retired members or Qualified Surviving Spouses/Domestic Partners who are enrolled in both Medicare Parts A and B. The monthly subsidy that you may receive is based on the number of whole years of service at the time of retirement (or DROP entry) as shown in the chart below.  

Member’s Whole Years of ServiceMaximum Medicare Health Subsidy*
20 or moreThe lesser of: $549.16 or 100% of the single-party premium of the participant’s health plan.
15 – 19The lesser of: $494.24 or 90% of the single-party premium of the participant’s health plan.
10 – 14The lesser of: $411.87 or 75% of the single-party premium of the participant’s health plan.
Less than 10No subsidy; Tier 6 retirees see below.**
*For members who: (1) entered DROP or retired after July 14, 2011, and (2) did not opt-in during the designated period to make the additional 2% pension contributions, the Maximum Medicare Health Subsidy is equal to the July 1, 2011 amount of $480.41.  
** Tier 6 members who retire on a service-connected disability pension with less than 10 years of service may qualify for a minimum health subsidy at age 55 if

Qualified Survivors Non-Medicare Health Subsidy Benefit

The non-Medicare health subsidy maximum for Qualified Surviving Spouses/Domestic Partners (Qualified Survivors) will increase from $939.09 to $1,051.78 per month, effective January 1, 2024.

If you currently receive a survivorship pension from LAFPP, you may also be eligible for a health subsidy if the following qualifications are met:  

  • You must be enrolled in a Board-approved health plan (one offered by Los Angeles Firemen’s Relief Association (LAFRA), Los Angeles Police Relief Association (LAPRA), UFLAC or Fire & Police Pensions) or participate in the Health Insurance Premium Reimbursement Program.
  • The sworn member had at least 10 years of service.
  • The sworn member received, or was eligible to receive, a health subsidy at the time of death; otherwise, you will be eligible when the sworn member would have been 55 years old.
  • The sworn member was a Tier 6 retiree with a service-connected disability.
  • If you receive a survivorship benefit pursuant to a purchase made by the retired member under the Survivor Benefit Purchase Program for Retirees, you are not eligible for a health subsidy. 

Retired Member Dental Subsidy Benefit

The maximum retiree dental subsidy will decrease from $43.81 to $42.93 per month, effective January 1, 2024. Per City of Los Angeles Administrative Code Section 4.1164(b), the maximum dental subsidy for retirees shall be the lower of LACERS’ maximum dental subsidy or any amount allowed active members of any LAFPP Tier.

You are eligible for a dental subsidy if you are retired with at least 10 years of service, are at least 55 years old, and are enrolled in a Board-approved dental plan. If you retire with more than 25 years of service, your eligibility is capped at 100% of the maximum subsidy. If you retire with 10 to 24 years of service, your subsidy is calculated at 4% of the current maximum for each whole year of service.

Note: Qualified Survivors are not eligible to receive a dental subsidy from LAFPP but are allowed to enroll in a Board-approved dental plan.

Questions

If you would like more information about LAFPP’s Health and Dental Subsidy program eligibility requirements, please contact the Medical and Dental Benefits Section at (213) 279-3115. Information is also available in the Retired Members section of www.lafpp.com.

Medicare Part B Premium Reimbursement for 2024

Posted on by Elizabeth Trevizo

SPECIAL NOTICE: This article only applies to eligible retired members of Los Angeles Fire and Police Pensions and respective Qualified Surviving Spouses/Domestic Partners.

The Centers for Medicare and Medicaid Services (CMS) has announced the new standard Medicare Part B monthly premium for 2024 is $174.70. However, some pensioners may pay less than this amount, as CMS does not increase a Medicare Part B participant’s premium by more than the dollar increase of their Social Security cost of living adjustment.  This is known as the “Hold Harmless Rule” and applies to all participants who have their Medicare Part B premium deducted directly from their Social Security check and who do not pay Income Related Monthly Adjustment Amounts, or IRMAAs.

  • If you are a new Medicare Part B enrollee in 2024, you will be reimbursed the standard monthly premium of $174.70 and do not need to provide additional documentation to LAFPP.   
  • If you began receiving the Medicare Part B premium reimbursement prior to 2024, LAFPP will notify you by email or mail with instructions on how to update your Part B premium amount on record.   

To update your Part B reimbursement for the 2024 calendar year: 

Please submit a copy of:

  • The first page of your Social Security New Benefit Amount statement for 2024; or
  • Your next Medicare monthly or quarterly billing statement (if you do not receive Social Security benefits)

To update your Part B reimbursement for premiums paid during the 2023 calendar year: 

Please submit a copy of your:

  • Social Security Form 1099 for 2023; or
  • Your first Medicare monthly or quarterly billing statement for 2023

Please redact any birthdate or SSN information and send all documents to LAFPP’s Medical and Dental Benefits Section via:

  • Email to: mdb@lafpp.com;
  • Fax to: (213) 628-7782; or
  • Mail to: Department of Fire and Police Pensions, Attn: Medical & Dental Benefits, 701 E. 3rd Street, Suite 200, Los Angeles, CA 90013

Due to the anticipated high volume of submissions, it may take approximately three months to process your Part B documentation and update your reimbursement amount on your LAFPP pension payment.

As a reminder, Part B reimbursement only applies to Retired Members or Qualified Survivors who are eligible for an LAFPP health subsidy and are enrolled in both Medicare Parts A and B. Any additional Part B penalties or fees charged by CMS are not eligible for reimbursement.

Frequently Asked Questions

1. How do I know if I am eligible for Part B reimbursement?

You must be a retired member or qualified survivor who is receiving a pension and is eligible for a health subsidy, and enrolled in both Medicare Parts A and B.

2. What document do I need to submit to receive my correct Part B reimbursement amount?

You must submit a copy of your Social Security benefits verification statement (your “New Benefit Amount”) or a copy of a 2024 Centers for Medicare and Medicaid Services (CMS) billing statement.     

3. My spouse (non-LAFPP member) is currently enrolled in Medicare Parts A and B.  Does he/she need to submit Medicare Part B premium documentation?

No.  Only the retired member or Qualified Survivor enrolled in Parts A and B is eligible for Medicare Part B premium reimbursement. 

4. I received a letter stating that I pay a higher Part B premium based on my income level (Income-Related Monthly Adjustment Amount – “IRMAA”). May I submit this letter as proof of my Part B premium?

Yes.  You may submit a copy of the first page of your IRMAA letter if it contains your name, address and 2024 monthly Medicare Part B premium deduction.  LAFPP does not reimburse IRMAA fees, so your Part B reimbursement will not exceed the 2024 standard monthly premium of $174.70.  

5. I receive a monthly Social Security payment, but I did not receive/cannot locate my “New Benefit Amount” Statement from Social Security.  What should I do?

You may call or visit your local Social Security Administration (SSA) office. You may also access proof of your 2023 Medicare Part B basic premium online at the SSA website: www.ssa.gov/myaccount. You may be required to create or register your SSA account. Please note that once you have an online account, your SSA notifications will be emailed to you.

6. When do I need to provide LAFPP documentation of my Part B Premium?

You may submit your documentation as soon as it is available and receive a retroactive reimbursement for up to twelve (12) pension roll months from the date your submission is received. 

If you have additional questions about your Medicare Part B reimbursement, please contact the Medical and Dental Benefits Section at (213) 279-3115, toll free at (844) 88-LAFPP ext. 3115, or via email to mdb@lafpp.com. 

Information About Charter Amendment FF

Posted on by Deborah Campos

The Los Angeles City Charter (Charter) provides that certain City employees who are sworn peace officers and perform peace officer duties for the City’s Police, Airports, Harbor, and Recreation and Parks Departments are members of the Los Angeles City Employees’ Retirement System (herein, referred to as “LACERS Peace Officers”). The vast majority of the City’s other sworn peace officer employees are members of Los Angeles Fire and Police Pensions (LAFPP).

Charter Amendment FF is on the ballot for the November 5, 2024 General Election. This ballot measure would amend the Charter and authorize the City Council to provide a process whereby LACERS Peace Officers, who are actively employed on January 12, 2025, may make a one-time election to transfer into LAFPP Tier 6. This includes LACERS Peace Officers who did not previously elect to transfer into LAFPP pursuant to prior Charter amendments.

This measure is consistent with Letters of Agreement executed between the City and bargaining units represented by the Los Angeles Airport Peace Officers’ Association. This measure is also consistent with actions taken by the City’s Executive Employee Relations Committee to include sworn employees of the City’s Police and Harbor Departments who are current LACERS members. The proposed measure amends certain sections of Article XI, Part 3 of the Charter.

Once the election results are certified and if it is determined that Charter Amendment FF has been approved by a majority of voters, LAFPP will collaborate with City Council, the Chief Administrative Officer, LACERS, and the Office of City Attorney to draft the implementing ordinance detailing the transfer process. This ordinance will include a refund process for those eligible Tier 6 LAFPP members who previously paid to transfer their City service from LACERS to LAFPP. 

Based on prior Charter Amendments, it is expected that the ordinance would be presented to the City Council in early 2025 and approved by spring 2025. Transfers or refunds will not be processed until the City Council approves the ordinance and within the timeframe specified in the ordinance.

For questions related to the ballot measure please contact your labor union. If the measure passes LAFPP will provide updates on our website.

Election – Board of Fire and Police Pension Commissioners

Posted on by Oscar Diaz

ELECTION NOTIFICATION

An election to select the Police Department Retired Member of the Board of Fire and Police Pension Commissioners (Board) is scheduled on February 23, 2024. The candidate elected will serve the term beginning July 1, 2024 and ending June 30, 2029.

BOARD MEMBER DUTIES – The Board exercises the prudent person standard in the discharge of its duties. It has sole and exclusive fiduciary responsibility to administer the Fire and Police Pension System (System) and its assets; has the authority to set and adopt investment policies for over $29 billion in fund assets; and has the duty to establish actuarial assumptions and adopt rules and regulations necessary to administer the System.

Preparation for regular and special meetings requires an individual to commit hours of advanced reading of Board Reports and disability cases. The Board normally meets on the first and third Thursdays of each month at 8:30 a.m. (PT). Most meetings are from three to four hours.

ELECTION PROCESS – Only retired, sworn Los Angeles Police Department members of the System are eligible to run and vote for this Board seat.  Members who are interested in becoming a candidate are required to complete and submit the attached Notice of Intent form which was mailed with this Election Notification. Signature gathering by eligible members is not required to run as a candidate.

Along with the Notice of Intent, the candidate has the option to submit an Occupational Ballot Designation and a typewritten Statement of Qualifications. The Occupational Ballot Designation will be printed under the candidate’s name and should consist of three words to describe the following: (A) the current principal profession, vocation or occupation of the candidate, or (B) the principal profession, vocation or occupation of the candidate during the last calendar year immediately before the filing of the Notice of Intent to become a candidate. The Statement of Qualifications may include information on education, work experience, years of service, date of retirement, and other relevant qualifications and shall not exceed 300 words in length.

Starting at 8:00 a.m. (PT) on December 13, 2023, candidates who wish to qualify for the ballot are required to provide the following documents: 1) Notice of Intent; 2) Occupational Ballot Designation (optional); and 3) Statement of Qualifications for Office (optional). The three (3) approved methods of submittal are detailed below. Documents received any other way will NOT be accepted.

  1. Hand Delivery: Candidates may hand deliver the completed forms by visiting the Office of the City Clerk – Election Division (Election Division) at Piper Technical Center, 555 Ramirez Street, Space 300, Los Angeles, CA 90012.
  2. Mail: Candidates may submit the completed forms via U.S. Postal Service using the paid-postage envelope provided along with this Election Notification.
  3. Email: Candidates may submit the completed forms via email to Clerk.ElectionAdmin@lacity.org.

The completed Notice of Intent must be received by the Election Division by the deadline of 5:00 p.m. (PT) on December 22, 2023.

Eligible voters will receive a ballot in the mail. Voters may choose to return their ballot via mail or may deposit it at the drop box located at the Election Division. Ballots received any other way will NOT be accepted. All completed ballots must be received by the Election Division by 5:00 p.m. (PT) on February 23, 2024 to be counted.

Sworn, retired members of the Los Angeles Police Department who become eligible within 30 days prior to the Election and wish to vote in the Election should obtain a Certificate of Eligibility (Certificate) from the Department of Fire and Police Pensions (LAFPP). LAFPP is located at 701 E. Third Street, Suite 200, Los Angeles, CA 90013. Beginning at 8:00 a.m. (PT) on February 13, 2024, after securing a Certificate, the newly eligible voter may present themselves in person at the Election Division and receive a ballot.

The ballots will be tallied on February 27, 2024 in the presence of the observers designated by each candidate. The Election Division will furnish to the Board the official certified results of the election within 14 days after the date of election. In the event that no candidate receives a majority of all votes cast in the initial election, a runoff election shall be conducted on Friday, April 19, 2024 for the two (2) candidates receiving the highest number of votes.

QUESTIONS – Inquiries regarding the election process may be directed to the Election Division at (213) 978-0444 or by email at Clerk.ElectionAdmin@lacity.org. Inquiries may also be directed to the Administrative Services Section of the Department of Fire and Police Pensions at (213) 279-3080.

THE STRATEGIC VALUE OF INVESTING IN EMERGING MANAGERS

Posted on by Stephen Bayutas

Message from Bryan Fujita

LAFPP CHIEF INVESTMENT OFFICER

To meet our ongoing commitment to maintain Los Angeles Fire and Police Pensions’ (“LAFPP”) financial health and fulfill our fiduciary duties to you, LAFPP’s investment program deploys a variety of diversification strategies.  Evaluating a wide range of investment opportunities—beyond those offered by the most well-known investment firms in the industry—and engaging with lesser-known Emerging Managers allows us to identify new and/or unique investment strategies that have the potential to produce strong returns while providing diversification to LAFPP’s investment portfolio. The Board of Fire and Police Pension Commissioners (Board) established a program to invest with emerging investment firms in 1991.  An Emerging Manager is typically a small firm that may be a new entrant to the market or relatively early in its business lifecycle.  LAFPP first identifies Emerging Managers based on the type and amount of assets a firm manages. Emerging Managers generally have less operational resources compared to established firms, making it challenging to mass market their products to a large universe of potential investors.  Therefore, LAFPP seeks to enhance its own outreach efforts to identify promising firms and investment opportunities.

In January of this year, the Board adopted the 2025-2027 Strategic Plan, which includes Strategic Goal #2: Enhance Outreach by Promoting Inclusivity and Engagement with Emerging Investment Managers.  This goal strengthens the Board’s longstanding Emerging Manager program by broadening our engagement with emerging investment firms when considering investment opportunities. 

Investing with skilled Emerging Managers offers LAFPP several advantages.  By investing with these managers early in their lives, we secure opportunities to grow with successful managers over the long term.  This can be particularly important with capacity-constrained investments like private equity funds where it is difficult to access established, high-performing managers when an investor does not have an existing relationship.  In addition, Emerging Managers generally operate with fewer assets under management and may have unique investment sourcing capabilities, allowing them to execute differentiated strategies from established firms.

To maintain the integrity and performance standards of LAFPP’s investment portfolio, Emerging Managers must meet rigorous qualification standards to be considered for a contract with LAFPP.  The professionals who operate an Emerging Manager firm must have significant investment experience implementing a thoughtful and repeatable investment process, exceptional past performance records (either in their current or similar past roles), and the ability to service the needs of a large public pension fund such as LAFPP, among other factors.  LAFPP selects all investment managers, both emerging and established, based on their proven ability to deliver superior risk-adjusted returns and address the investment needs of the portfolio.

LAFPP selects all investment managers, both emerging and established, based on their proven ability to deliver superior risk-adjusted returns and address the investment needs of the portfolio.

Under California law and the Board’s fiduciary duties, the Board must award all contracts only on the merits, and the Board must award investment contracts according to the terms of LAFPP’s Investment Policies.  When searching for the best investment opportunities, we must ensure that the Board considers the widest range of suitable options.  One way we achieve this is by conducting outreach across the Emerging Manager universe, which includes outreach to smaller firms which may be owned by minorities, women, persons with disabilities, U.S. Military veterans, and/or lesbian, gay, bisexual, transgender and queer (LGBTQ) individuals, to educate them about opportunities to compete for contracts with LAFPP.  This expanded outreach happens alongside and complements the general outreach we conduct to all interested firms, emerging and established, via traditional means (e.g., advertising in trade journals, screening investment databases, and posting requests for proposals to the City of Los Angeles’ contracting opportunities website, RAMPLA.org).  

LAFPP remains one of the most well-funded and well-run pension funds in the country.

Given that Emerging Managers are smaller firms with limited resources, we mitigate potential business risk in our portfolio from investing with Emerging Managers by allocating smaller investment amounts across multiple managers, ensuring portfolio diversification and resilience in case a manager does not perform as expected.  As of June 30, 2024, LAFPP had invested/committed $1.8 billion of its $31.3 billion portfolio, or about 5.8% of the portfolio, with 71 Emerging Managers.  Additionally, 22 managers who were initially hired as Emerging Managers have successfully graduated from emerging manager status and continue to manage approximately $2.5 billion of total investments/commitments for LAFPP today.  Historical performance of LAFPP’s Emerging Managers is on par with investments managed by larger, more established firms.

With a combined funded ratio of 96.8% (as of June 30, 2023) and a 10-year net-of-fees total portfolio return of 7.84% (as of March 31, 2024), LAFPP remains one of the most well-funded and well-run pension funds in the country.  Our engagement with and investments in Emerging Managers are an important part of our strategy for success.  

Thank you for entrusting us with your retirement security. We are committed to serving you and maintaining a proactive, transparent investment approach that safeguards your future.

For further information about our Emerging Manager outreach initiatives for the current fiscal year, please refer to the 2024-25 Annual Plan adopted by the Board on June 20, 2024, available on our website at lafpp.lacity.gov/about/strategic-and-annual-plans. 

For further information about LAFPP’s Emerging Manager program and policies in general, please refer to Section 6.0 – Emerging Managers Policy of the Board’s Investment Policies, available on our website at lafpp.lacity.gov/board-of-commissioners/policies.