Thursday, December 19, 2019

Why Does NYCERS Take Six Months to Create a Retirement Option Letter

Update: 12/31/2019 - NYCERS spent $82.1M in FY-2019 on operating expenses, up from $59.7M in FY-2018.

In particular:
NYCERS Contract Expenses for FY-2019
Expense Amount
CWI Coaching$185,000
Blue Hill Data$1,124,800
22 various IT consulting firms$3,172,751
Software Licenses&Support$6,033,250
DP Equipment$4,521,706

When a NYCERS member is planning to retire, he/she usually visits the customer service center on Jay Street in downtown Brooklyn around 60 days before his/her retirement date. He/she files a retirement application and sits with NYCERS staff person to be briefed on the procedure.

One of the things the NYCERS agent does is give the member a printed estimate of the member's "maximum" retirement benefit amount along with reduced amounts for option selections for a given beneficiary. The estimate, however, is not adequate to allow a member to make an informed option selection.

Choosing an option rather than a maximum benefit, allows a member to leave continuing benefit to a designated beneficiary after the member dies.

With a maximum choice NYCERS stops payment of the full benefit amount when the retiree dies. If the member chooses one of the option amounts, NYCERS will continue to pay a benefit to the beneficiary that the member designated when he/she picked an option choice.

This maximum/option election occurs after the member receives the final option letter. The members has 60 days after the date of the letter to make his/her choice.

Currently, NYCERS is informing members that it will take about six months for NYCERS to send the member a final option letter on the annual retirement benefit along with the reduced amounts associated with option benefits that member can select in place of the full benefit.

As of 2005, NYCERS was quoting a three month period for sending a final option letter to members who were retiring.

Why this fall off in the service level?

As of 2020, NYCERS has an administrative budget of $81.1M and 476 employees (F/T, P/T, Per Diem).

In 2005, NYCERS had an administrative budget of $34.6M and 385 employees (F/T, P/T. College Aides).

As of August 8, 2018, NYCERS awarded a $14.8M contract to Accenture to install a customer relation management system (CRM). If you want to read the gory details, check the NYC City Record website for a Employees Retirement solicitation date 11/27/17, CRM.

A rough definition of a CRM system is as follows:

Customer relationship management (CRM) software is software that automates and manages the customer life cycle of an organization. It is usually used by the sales team, sales reps, and call center reps to maintain contact with customers and quickly respond to their needs.

You might think that this project would help with improving the service that NYCERS is trying to give retiring members. This contract had a one year implementation term with 3 years of maintenance and three one year renewal options. With this effort members should be seeing improved service since the one year was up as of August, 2019. Of course the project is late.

1 comment:

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