THE 2021 MONEY ISSUE

 A printable PDF of this issue is located here.

DISCLAIMER: This newsletter is written by CRONA Nurses, who are not financial, legal, or tax advisers. We advise you to do your own research and consult the appropriate professionals. We make a best effort to research the information in this newsletter and present it accurately. Our goal is to help you pay more attention to your personal finances and maximize the benefits in our contract.

 

Hourly Rates and Raises

CRONA Nurses are paid by the hour for all time worked. Our hourly rates are determined by the contracts we negotiate with the hospitals. There are two types of raises in our contracts: annual raises and step raises.

Annual Raise: For the 2019 – 2022 contracts, we negotiated an annual increase of 3%, which occurs in the pay period closest to April 1st of each year of the contract. The last annual increase was in April of this year. We do not know what the increase will be for 2022 because that will be part of the next contract and we will have to negotiate it.

Step Raise: Step levels are determined by length of employment. New graduates and nurses with less than 6 months’ experience are hired at Step 2. The highest step an experienced nurse may be hired at is Step 7; the hiring step for an experienced nurse is negotiated between the nurse and the hospital at the time the nurse is hired and is not specified by the current CRONA contract. Increase to Step 3 is after 6 months at Step 2; increases in Steps 4 – 7 are after one year at each step. Steps 8 through 13 require a set number of years of hospital employment, ending at Step 13 with 30 years’ employment.

 

Retirement Plan: the 403(b)

The hospitals eliminated pension plans in the 1990s. The retirement savings plan (RSP) for nearly all current CRONA Nurses is the 403(b). Similar to the 401(k) offered by for-profit companies, the 403(b) is a savings plan defined and regulated by the IRS. What CRONA Nurses negotiated with the hospital are things like who is eligible, how much the hospital contributes, amount of matching contributions, and when the new hire Nurse becomes eligible for matching employer contributions.

 

All Regular Nurses with an FTE of at least 0.5 are eligible for the Retirement Plan. Participation begins after twelve (12) months continuous employment. There are two contributions from the hospitals: the Basic Contribution and the Retirement Match.

 

The Basic Contribution is set by our contract at five percent (5%) of the individual Regular Nurse’s annual pension eligible earnings.

 

The Retirement Match is a set percentage, matching contribution equal to the amount of the Nurse’s voluntary contribution of a percentage of pension-eligible earnings. You only receive the Retirement Match if you make voluntary contributions. The matching contribution is about to go up! In 2019, we negotiated an additional 1% increase in the matching contribution that starts soon. Starting with the pay period that begins 12/26/2021, the matching contribution will be up to:

  • 5% for Regular Nurses with fewer than five (5) years of retirement eligible service
  • 6% for Regular Nurses with between five (5) and ten (10) years of retirement eligible service
  • 8% for Regular Nurses with ten (10) or more years of years of retirement eligible service

Do Not Leave Money On The Table! If you contribute 0% of your pay to the 403(b) Retirement Plan, you will receive 0% matching instead of the 5%, 6%, or 8% you are eligible to receive. This point is emphasized because there are a few CRONA Nurses who are not contributing enough to maximize their matching contribution.

 

For more information about the IRS regulations for the 403(b), please see the IRS.gov website.

 

2022 Increases in Ability to Make After-Tax Contributions to Retirement – Effective January 2022

Currently, Nurses at Stanford and Packard who are eligible to make contributions to retirement under the Retirement Savings Plan (RSP) are able to make both pre-tax and after-tax contributions to their accounts. The terms of the RSP, however, limit the amount of after-tax contributions eligible Nurses may make. Specifically, after-tax contributions can currently be made only up to the percentage of contributions that the employer matches under our contract (currently between 4% and 7%, depending on your years of experience).

 

In 2019, CRONA filed a grievance challenging those limits and pursued that grievance through detailed negotiations. To resolve the grievance, the Hospitals have agreed to amend the RSP to substantially increase the limits on Nurses’ ability to make after-tax contributions to retirement. As a result, effective January 1, 2022, Nurses who are eligible to make after-tax contributions to the RSP will be able to make after-tax contributions of up to 15% of retirement eligible earnings. (The settlement does not affect pre-tax contributions nor does it impact the applicable annual Internal Revenue Service limitations that apply to your pre-tax and after-tax contributions under the RSP.)

 

Keeping an Eye on Your Retirement Benefits

We encourage all Nurses to carefully review your new options for making both pre-tax and after-tax contributions to retirement as of January 2022. If you want to make any changes to your pre-tax and/or after-tax contributions, you may do so through the plan administrator, Fidelity. https://www.fidelity.com/

Fidelity has a Workplace Financial Consultant to help you review your investment options.

 

Retirement Medical Benefits

Honestly, the available medical retirement benefit for CRONA Nurses is not especially amazing. What retirement medical benefit group each CRONA Nurse is in depends on date of hire. All who were hired November 1, 1997 or later are in Group D. That is the vast majority of CRONA Nurses and this article will focus on Group D.

 

Group B and C Nurses, please note that you have a one-time option to convert from your current Group B or C to a Group D benefit if you prefer. The information about Group B and C benefits will be provided to you at the hospital’s mandatory retirement class. Please evaluate both benefits carefully and choose the group that is best for you.

 

The original Group D benefit provided by the hospital was $0.00. With the 2010 negotiations, CRONA negotiated a small benefit for Group D. Nurses. In 2019, CRONA negotiated an increase to the Group D benefit with incremental increases in each year of the current contract. The final increase goes into effect on January 1, 2022, bringing the total increase for our current contracts to a 65.375% increase over the original benefit.

 

The benefit is provided in the form of an HRA – Health Reimbursement Arrangement. The HRA is an IRS-regulated and employer-funded medical retirement benefit plan that reimburses employees for qualifying medical expenses. The total amount of the benefit depends on age at retirement and years of continuous service at retirement. It starts at age 55 with 15 years of continuous service for a total benefit of $8,268.75 and maxes out at age 70 with 30 years of continuous service for a total benefit of $50, 852.81.

 

Health Equity, the company that manages our HSA/FSA/DCFSA accounts, also manages the HRA. More information is available through Health Equity here: https://learn2.healthequity.com/shclpch/hra/#hra_hero

Or through HealthySteps:

SHC: https://shc.healthysteps4u.org/health-life-benefits/savings-spending-accounts/health-reimbursement-account/

LPCH: https://shc.healthysteps4u.org/health-life-benefits/savings-spending-accounts/health-reimbursement-account/

 

What is my benefit if I am in Group D? Please see the chart below. It shows what Group D medical retirement a Nurse is eligible for based on the Nurse’s age and years of continuous service at retirement. The minimum to maximum amount of benefit ranges from $8,268.75 (retiring at age 55 to 61 with 15 years continuous service) to $50,852.81 (age 70+ with 30 years continuous service).

 

Group D Benefit – Starting January 1, 2022

 

Differentials

Please see the chart  for the different types of differentials in our contracts. Make sure to pay attention to which hospital you look at as there are a few differences in differentials between SHC and LPCH.

 

Explanation of Some Differentials

Most of these differentials are well-known to CRONA Nurses; all of them are described in our contracts. Here we will cover some of the less well-known differentials.

 

Preceptor: assigned to train a specific nurse. Qualifying preceptees include new hire nurse, new grad, specialty training programs (such as critical care, OR, hematology/oncology, labor & delivery), current nurses who transfer to a new unit or location, current nurses learning a new role on the unit, current nurse on the unit learning a new specialty skill (such as ECMO, VAD, CRRT). NOTE: contract language only includes precepting of travel nurses for the 2019 – 2022; to continue getting preceptor pay for precepting travel nurses we will have to negotiate language into our next contracts. See Section SHC 7.10 or LPCH 7.11 for complete contract language; also see Side Letter Re Traveler Orientation 2019 (LPCH contract page 101/SHC contract page 106) for information about pay for precepting travel nurses.

 

Additional Weekend Incentive Differential: Per LPCH Section 7.5.5: “If a Regular Nurse is required to work more than four (4) weekend shifts in a schedule period, s/he will receive a differential of Five Dollars ($5.00) per for working on any weekend shift over four (4) shifts.” For LPCH nurses who have to work 3 weekends over the 2021 holidays, you will likely qualify for this differential and must check your paychecks to verify you receive it. Remember, working only one shift on a weekend does count towards eligibility for weekend premium pay.

 

Working Outside Classification: This language about what qualifies is different for LPCH and SHC. The differential amount, 7.5%, is the same at both hospitals. The most common reason for receiving this differential is for CRONA Nurses who temporarily work in an interim APCM role.

LPCH: must be designated in writing to work in the outside classification position. Assignment to position must be for a minimum of fifteen (15) continuous calendar days to qualify for differential. Positions included are “Acting” Patient Care Director, Patient Care Manager, Assistant Patient Care Manager, Nurse Educator, Nursing Supervisor, or other nonbargaining-unit position. While working outside classification, exempt from all Compensation provisions of the contract except 7.4. See LPCH Section 7.4 for complete contract language.

SHC: must be designated to work in the outside classification position. Assignment to position must be for a minimum of fifteen (15) continuous calendar days to qualify for differential. Positions included are Patient Care Manager and Assistant Patient Care Manager. See SHC Section 7.4 for complete contract language.

 

SAVINGStrong -> CRONAStrong -> UNIONStrong

Do you put a portion of each paycheck to savings? Do you have a “Negotiations Fund” of money set aside for your expenses in case of a strike? As CRONA Nurses we are members of a union. We benefit from our combined strength in securing improvements to our wages, benefits, and working conditions in the contracts we negotiate. However it is always a possibility at contract negotiations time that we may need to go on strike. Be strong by being prepared. CRONA Nurses have gone on strike three times in our history; the most recent strike was in 2000. Although many CRONA Nurses replaced their imcome by taking temporary positions at other hospitals during previous strikes, others elected not to work during the strike and relied on their savings. It is best to be prepared for every possibility and to have money set aside to cover your living expenses in case our contract negotiations lead to a strike. If you have not already done so, start your Negotiatons Fund today.

 

We should all be SAVINGStrong – make sure you are putting money aside to cover your living expenses in case you are temporarily without income. There are reasons to do this aside from our contract negotiations. If you’ve every had to go on medical leave and apply for Disability through the EDD, you know it can take weeks to receive your first payment. Your bills don’t go away while you wait for your first Disability payment. Even when you start receiving payments, they may not equal your usual income – especially if you frequently work over commitment or SNC/overtime or work on-call. In the last (almost) two years of COVID, many nurses found themselves unexpectedly taking time off due to their own illness, a family member’s illness, or to care for children and parents whose schools and care facilities closed or went remote.

 

Open Enrollment

Virtual Benefits Fair November 1 – 12. It’s that time of year – making choices about your benefits. Even if you keep the same benefits selections as this year, there are some things – like your HSA contribution – that must be entered every year. Don’t let your HSA/FSA contribution be set at $0. Like last year, benefits sign-up will be online only.

 

PTO Cashout Option During Open Enrollment

Voluntary PTO Cash Out. During the annual benefit open enrollment period (typically held in November), a Nurse who as of the beginning of the payroll period immediately before the start of the open enrollment period has four hundred forty (440) hours or more of accrued but unused PTO in his/her regular PTO Accrual Account, and no accrued but unused hours in a Cash Out PTO Account, may pre-elect to receive payment in lieu of paid time off for up to eighty (80) hours of PTO to be accrued in the following calendar year, which cash out payment will be made in November of the following calendar year. In order to receive such payment in lieu of paid time off, the Nurse must have the accrued but unused PTO necessary to cover the payment at the time the payment is to be made. If the Nurse does not have enough accrued but unused PTO at the time the payment is to be made, the Nurse will be paid for such portion of the elected amount as his/her accrued but unused PTO will cover, if any. Payments made in lieu of paid time off will be at the Nurse’s base wage rate and will not include shift differential. The Employer will notify the Nurse that the payment has been made.

 

Health Savings Account (HSA)

The HSA is a way to set money aside for covered medical expenses. This account is available per IRS rules if you have a high deductible insurance plan; this the Aetna PPO for us. For CRONA Nurses only, this is the “free” plan that has no monthly payments for employee, employee/spouse, employee/children, or employee/family coverage. Both Kaiser and SHCA have a monthly premium even for employee-only coverage; there are reasons people choose each of these plans and every Nurse must make the choice that s/he feels is best. The HSA is covered in detail here because the majority of CRONA Nurses select Aetna PPO insurance and because the HSA does not expire yearly like the FSA and is portable between jobs.

 

What Do CRONA Nurses Choose? There are approximately 4800 CRONA Nurses. For 2021: 2,538 chose Aetna, 915 chose Kaiser, 720 chose SHCA; the remainder are ineligible for coverage (most Relief Nurses) or are covered under a spouse’s plan and declined hospital insurance.

 

IRS Contribution Limits vs. Hospital Contribution Limits: Protect Yourself

There is an IRS limit on annual HSA contributions. Your employer can choose how much of that limit you can contribute with pre-tax payroll deductions. The hospitals choose not to allow CRONA Nurses to contribute the IRS maximum using pre-tax payroll deductions. For 2022, CRONA Nurses may only contribute $3350 of the $3650 for individual plans and may only contribute $6750 of the $7300 for family plans. To maximize your HSA contributions, set your payroll deduction to the maximum the hospital will allow, then go to Health Equity to make a manual deposit for the remaining IRS allowed contribution. A manual contribution may be made at any time during the year, in one or more increments, as long as the maximum total annual contribution is not exceeded.

 

Catch-up Contributions for 55+

If you or your covered spouse are age 55 or older, you are eligible to make additional annual contributions. For the year you turn 55 it is a partial contribution; for each year after the year in which you turn 55 it is $1000. It’s the IRS, so there is an instruction booklet. See instructions for IRS From 8889 to learn more: https://www.irs.gov/instructions/i8889

 

If you or your spouse will turn 55 in the future, set a calendar reminder now to remind yourself to start making catch-up contributions in the year you become eligible.

 

Option to Invest Your HSA Money

Do you want your funds to sit in your HSA account without growth, or would you prefer to invest the money in mutual funds? It’s your option! If you have a balance of at least $2000 in your HSA, you may invest the money in mutual funds with Fidelity. You must keep $2000 in cash in your HSA account, but any balance in excess of $2000 may be invested in Fidelity mutual funds. These mutual funds, like the mutual funds our 403(b) retirement account funds are invested in, are not federally insured or otherwise guaranteed. But they also have the potential to grow and make more money that the original investment. Make sure to consult your financial adviser to you are not sure if investing your HSA funds is right for you.

 

How to Invest

Our Health Savings Accounts are managed by a company called Health Equity. There are instructions available at the Health Equity website’s Help portal here: https://answers.healthequity.com/app/answers/detail/a_id/1032/kw/mutual%20funds.

First, log in to the portal: https://my.healthequity.com. From the My Account home page, click “Investments” to access the Investments desktop. From there you can elect to invest and choose which mutual fund(s) to purchase. The screenshot shown here is a portion of the home page with an arrow to indicate where to click for the Investments desktop. This screenshot was taken when the account was accessed from a desktop computer. Health Equity also has  a mobile app that has most of the functionality of the desktop version.

Qualified Medical Expenses For HSAs

The CARES Act (COVID-related legislation passed in 2020) expanded what HSA funds may be used for and now includes, among other things, nonprescription medicines and menstrual care products. From the IRS website https://www.irs.gov/instructions/i8889:

Generally, “qualified medical expenses” for HSA purposes are unreimbursed medical expenses that could otherwise be deducted on Schedule A (Form 1040). See the Instructions for Schedule A and Pub. 502, Medical and Dental Expenses. As the HSA account beneficiary, you can pay these expenses for medical care for yourself, your spouse, and your dependents. Even though nonprescription medicines (other than insulin) do not qualify for the medical and dental expenses deduction, they do qualify as expenses for HSA purposes. The cost of menstrual care products (tampons, pads, liners, cups, sponges, or other similar products) are also reimbursable for HSA purposes.

Expenses incurred before you establish your HSA are not qualified medical expenses. If, under the last-month rule, you are considered to be an eligible individual for the entire year for determining the contribution amount, only those expenses incurred after you actually establish your HSA are qualified medical expenses.

You cannot treat insurance premiums as qualified medical expenses unless the premiums are for:

  1. Long-term care (LTC) insurance,
  2. Health care continuation coverage (such as coverage under COBRA),
  3. Health care coverage while receiving unemployment compensation under federal or state law, or
  4. Medicare and other health care coverage if you were 65 or older (other than premiums for a Medicare supplemental policy, such as Medigap).

.Coverage under (2) and (3) can be for your spouse or a dependent meeting the requirement. For (4), if you, the account beneficiary, are under age 65, Medicare premiums for your spouse or dependents (who are age 65 or older) are generally not qualified medical expenses.

IRS Publication 502, Medical and Dental Expenses, is available on the IRS website here: https://www.irs.gov/forms-pubs/about-publication-502

 

HSA Payroll Deduction Eligibility

All Regular Nurses, Relief C Nurses, and Relief D Nurses are eligible for pre-tax payroll deductions for HSAs or any other IRS allowed medical spending accounts. Relief B Nurses are eligible to purchase medical benefits at the group rate but not to make pre-tax payroll contributions. Relief A and Limited Relief Nurses are not eligible for medical benefits.

 

Your PTO – Paid Time Off

All Regular Nurses start accruing PTO upon hire. PTO is accrued on the basis of paid hours, on a maximum of eighty (80) hours in a pay period, excluding missed meal period penalties, PTO cashouts and on call. As an exception, double shifts (16 consecutive hours) worked in a workday may result in an accrual of PTO over eighty (80) hours in a pay period. For LPCH critical care transport Nurse specialists, PTO is accrued on regularly scheduled On Call time at one half (1/2) the regular accrual rate. Nurses accrue PTO on on-call hours at ½ the regular accrual rate. PTO accrual will continue for all hours off on Jury Duty and legal appearances (as defined by contract language), for hours the Regular Nurse would normally have been scheduled to work.

 

Q: Do I accrue PTO when I use PTO hours?

A: Yes.

Q: Is there a cap on how many PTO hours I can accrue?

A: There sure is. The cap is 520 hours. Once you get to 520 hours accrued PTO, you will stop accruing PTO.

 

What’s My PTO Accrual Rate?

See the following chart for your PTO accrual rate. Now that you know your accrual rate and which ours accrue PTO, you should be able to check your PTO balances and ensure your PTO is accruing correctly.

 

 

Years of Service Time Accrued Per Hour Worked Projected Annual Hours For Full-Time 8-Hr Employee Projected Annual Days For Full-Time 8-Hr Employee
First year of employment .1000 208 26
2nd through 3rd year .1193 248 31
4th through 9th year .1385 288 36
10th and subsequent years .1500 312 39

 

Your ESL – Extended Sick Leave

Extended sick leave compensates Regular Nurses in the case of their own extended illness or injury, and is utilized for absences beginning the fourth (4th) consecutive day of illness or injury, or from the first (1st) day if the employee is hospitalized on that day. Nurses with anticipated or realized six (6) months of assignment to an evening or night shift in a calendar year will receive shift differential for ESL hours used when the Nurse is scheduled to work a shift for which a differential is paid at the time the ESL hours are used.

 

What’s My ESL Accrual Rate? Nurses will accumulate ESL at the rate of .0116 hours per hour worked (the equivalent of 24 hours per year for a full-time employee). ESL will be accumulated on the basis of productive hours worked, including overtime, on PTO and ESL hours taken, and for paid jury duty and paid bereavement leave hours, to a combined maximum of eighty (80) such hours in a biweekly pay period. There is no limit on the accumulation of ESL.

 

Q: I was told that I can’t start using ESL until my 4th day of absence, not my 4th day of illness.

A: That is incorrect. You may use ESL on your 4th day of illness or injury, regardless if you were scheduled to work when your illness/injury started. If someone gives you incorrect information, please let CRONA know who did that so we can provide education.

Q: Do my ESL hours cash out when I resign?

A: No. Any unused ESL hours are lost when you resign or retire. They are not cashed out.

 

Your ATO – Absent Time Off

Nurses eligible to accrue PTO (that means Regular Nurses) accrue “A” Time Credit on the same productive hours as PTO is accrued.

 

What’s My ATO Accural Rate? See the chart below for your ATO accrual rate. Now that you know your accrual rate and which ours accrue PTO, you should be able to check your ATO balances and ensure your ATO is accruing correctly.

 

Years of Service Time Accrued Per Hour Worked
First year of employment .0243
2nd through 3rd year .0253
4th through 9th year .0265
10th and subsequent years .0273

 

Annual ATO Cashout Opportunity. Effective in August of each year a Regular Nurse’s accumulated “A” Time will automatically be retained in the Regular Nurse’s “A” Time bank unless the Nurse requests that the “A” Time be converted to PTO or cashed out based on the same calculation as cashing out PTO. Make sure to consider your PTO balance before requesting that ATO be converted to PTO, because PTO is capped at 520 hours. There is not a cap on ATO hours.

 

#CRONAStrong

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