Frequently Asked Questions

The Fraternal Order of Police Lodge No. 1 (”Lodge No. 1”) established the Trust to hold money for a retiree medical expense reimbursement benefit plan. The purpose of the Trust is to provide an entity into which contributions from the City of Pittsburgh (“City”) can be paid, and through which the Trustees can create and administer the Plan for the Employees on whose behalf the contributions have been paid, and their Beneficiaries.

The Plan is designed to provide monthly, lifetime  reimbursement payments toward qualified premiums and medical expenses of Eligible Retirees of the City of Pittsburgh Bureau of Police (“Bureau”) upon meeting eligibility requirements.  While these benefit payments cannot be guaranteed, it is the intent of the Board of Trustees to provide retirees with a meaningful benefit amount, while at the same time preserving the Trust’s financial integrity over a long-term horizon.

Contact the Trust Office (see Part F on the last page of this document for contact information) to handle administrative matters. The Trust Office maintains a comprehensive and centralized database that is used to process claims and inquiries. Notifying the Bureau or Lodge No. 1 will not protect your rights to a benefit under the Plan. 

Your benefits from this Trust come in the form of reimbursement payments toward the cost of medical, dental or vision insurance premiums and medical expenses incurred after you retire.  These are called “Covered Expenses” under the Plan (see Part C below for further information).

Premiums include insurance for medical and/or hospital expenses, dental or vision care, and prescription drug or long-term care insurance.  The premium can be reimbursed to you, up to your monthly benefit level, for a wide variety of health care plans, including Medicare premiums and Medigap supplemental policies.

Reimbursable medical expenses are tax deductible expenses for treatment, diagnosis, cure, mitigation and prevention of disease or injury.  These expenses include items such as deductibles and copays on your medical insurance, costs for prescription drugs, costs for insulin, medical, dental and vision exam fees, lab fees, etc.  You can find a complete description of tax deductible medical expenses in IRS Publication 502, which can be found online at www.irs.gov/pub/irs-pdf/p502.pdf

Eligibility for monthly, lifetime benefits is generally open to any member of Lodge No.1, who meets all of the following requirements:

• Earned 20 years of Active Service (generally this means 20 years of full-time employment in a classification represented by Lodge No. 1); 
• Contributions were made on the Employee’s behalf for all years of Active Service after the date that contributions on behalf of that Employee were required to be made to the Trust;
• Ceased employment with the Bureau, and remains unemployed by the Bureau;
• Attained age 50;
• Retires from employment with the Bureau, and is eligible for retirement benefits under the City’s retirement plan (including a medical retiree).

It is the intent of the Trustees to administer the Plan so that benefits for an Eligible Retiree will last for his or her lifetime. However, this is not guaranteed. The Trustees have the authority to reduce or terminate benefits earlier, if prudent, to preserve the financial soundness of the Plan.

An Eligible Retiree’s “Benefit Level” is calculated by multiplying the Eligible Retiree’s total number of Active Service Units (earned during employment) by the Unit Multiplier in effect on the date of the Eligible Retiree’s retirement from employment with the Bureau. This is the maximum amount of reimbursement the Eligible Retiree may receive per month.

The Trust will credit a participant with one Active Service Unit (ASU) for each $25 of contributions made on the participant’s behalf to the Trust.

The Unit Multiplier is the variable amount periodically set by the Trustees with the help of a professional actuary. The Unit Multiplier is based on an actuarial study of demographic and financial factors related to the Plan. The current Unit Multiplier is $0.16.

Because you earn one ASU for each $25 contributed to the Plan, your Benefit Level at retirement depends upon the amount of contributions made to the Plan during your employment. If contributions made to the Plan on your behalf increase, you will earn more ASUs each month and increase your benefit level. However, increases to the City’s contribution must be negotiated.  Individuals cannot individually elect to contribute to this Plan due to IRS regulations. See Part E regarding tax advantages.

Yes, the Trustees have the authority to reduce or terminate benefits, if prudent, in order to preserve the financial soundness of the Trust.  However, the Trustees make every effort to set the Unit Multiplier conservatively so that benefit reductions are not necessary.

The Plan provides benefits to the Surviving Spouse and Surviving Child(ren) of the Eligible Retiree. Surviving Spouse is the lawful spouse of an Eligible Retiree or Employee who was married to the Eligible Retiree or Employee for at least 12 months on the date of death.The monthly Benefit Level for a Surviving Spouse and/or Surviving Children is 50% of the Eligible Retiree’s Benefit Level (with one monthly Benefit Level for all survivors). The Surviving Spouse’s monthly benefit will start the month after the Eligible Retiree dies, but not before the Surviving Spouse attains age 50. If an Employee dies after attaining 20 years of Active Service as an Employee represented by Lodge No. 1, the Employee does not have to attain the other eligibility requirements for the Surviving Spouse to be eligible, subject to the Surviving Spouse’s attainment of age 50.

Because the Plan grants the same rights and benefits to same-sex spouses as it does for opposite sex spouses, the Plan does not provide survivor benefits for domestic partners.

Surviving Children include the natural and adopted children of the Eligible Retiree, who are under the age of 26. Children over the age of 26, who are legally dependent upon the Eligible Retiree and determined to be totally disabled by the Social Security Administration, are also eligible for survivor benefits.

The claim form is available on the Trust website.  You must complete and sign the claim form and submit it to the Trust Office via email, fax, or mail (see contact information in Part F), along with documentation showing the type of healthcare services, supplies or coverage, the date of the medical expense or premium, and proof that the Beneficiary paid the expense. If you have questions about documentation or coverage of a particular expense, contact the Trust Office.

Because the Plan grants the same rights and benefits to same-sex spouses as it does for opposite sex spouses, the Plan does not provide survivor benefits for domestic partners.

All contributions into the Plan are bargained by Lodge No. 1 and paid by the City.  The City’s contributions are not taxable income for Plan participants.

Contributions are held in a pooled account in the Trust, which holds all monthly contributions made by the City on behalf of all Employees.  The Board of Trustees has retained a professional investment advisor to manage investment of the Trust funds. In addition, the Trust received a tax-exempt determination from the IRS, which allows the Trust funds to grow tax free. The advantages of tax-free earnings and compound interest allow significant appreciation on the contributions.

Unlike benefits paid from a pension or 457 plan (deferred comp plan), the benefits from this Plan are not taxed upon receipt during retirement. The benefits from this Plan are paid only for reimbursement of tax-deductible medical expenses, and thus are tax free.

• Contributions to the Trust are not considered taxable wages;
• The Trust assets will accrue earnings on a non-taxable basis; and
• Your benefits will not be taxed when you receive them.

Due to the highly tax advantaged nature of this Plan, the IRS has strict regulations regarding distribution of assets only for medical expenses and prohibition of individual election on contributions and participation.There is no individual election whether to participate in the Plan; all employees represented by a bargaining group must participate pursuant to mandatory requirements in a collective bargaining agreement. Nor can you individually elect to make your own contributions to the Plan.

The IRS requires the Plan to maintain documentation of the tax deductible nature of each claim reimbursement from the Plan.This means that you may be asked to provide documentation from your medical provider showing that the medical services or supplies were prescribed or recommended for treatment of a specific disease or medical condition.The IRS also requires that the Plan collect documentation showing that the Beneficiary paid for the expense prior to reimbursement, and this includes proof of payment of each monthly insurance premium.  IRS Publication 502 provides information on the type of expenses that are tax deductible. See www.irs.gov/pub/irs-pdf/p502.pdf

The Trust is controlled and administered by a Board of Trustees, composed of members of Lodge No. 1. The Trustees are charged with the fiduciary responsibility to administer the Plan for the “exclusive benefit” of the participating employees and beneficiaries. All contributions and earnings into the Plan can be spent only on benefits and reasonable administrative expenses. If the Trustees fail to do so, they are subject to civil and criminal penalties.

The Plan and Trust are audited by an independent auditor annually, and a report is filed annually with the US Department of Labor.  The most recent annual report is posted on this website and prior year reports are available to the public on the Department of Labor website.

There are five (5) Trustees. The President of Lodge No. 1 nominates one Trustee for approval by the Executive Board of Lodge No. 1. Four Trustees are elected by the members of Lodge No. 1.

The current Trustees are:

• Elizabeth Phillips, Chairperson
• Susan Hillen, Secretary
• Jonathan Gromek
• David Pisani

Trustees are not compensated for their services to the Plan and Trust. All Trustees serve as volunteers.

No.  Day-to-day administration is handled by a contract administrator, CW Breitsman Associates LLC, operating as the Trust Office.  The Trust Office is an excellent resource and provides important administrative services to the Trust and plan participants. For example, to find out your current Benefit Level, submit benefit claims, request a copy of the Plan, or notify the Trust of a change in address, you should contact the Trust Office.The contact information is:

FOP Fort Pitt Lodge No. 1  Retiree Medical Trust Office

c/o CW Breitsman Associates LLC

Three Gateway Center, #1625 

401 Liberty Avenue, Pittsburgh, PA  15222 

Phone: 412-325-2865 (Local), or 833-902-1533 (toll-free)

Email: michele@cwb-a.com