TelCo Retirees Association, Inc.:Newsletter August 2005

August 2005 TelCo Retirees Association, Inc. August 15, 2005 Dear Member: The TelCo Retirees Association has received a Notice of Prehearing Conference by the Public Utilities Commission of the State of California. “Notice is hereby given that the Public Utilities Commission has set a prehearing conference in the above-entitled matter before Administrative Law Judge Victor D. Ryerson, for September 2, 2005, at 10:00 A.M. in the Commission Court Room, State Office Building, 505 Van Ness Avenue, San Francisco, California.” A prehearing conference is called to determine the parties, positions of the parties, issues, and other procedural matters. Our Association’s response to the attorney for SBC (Mr. Wong) was priority mailed, confirmation on Wednesday, August 10, 2005. (See enclosure) Based upon the evidence submitted, your Association remains confident we will prevail in this formal Commission complaint to restore the telephone concession service you were promised at the time of your retirement. (Please keep in mind this complaint only involves retirees living within the state of California.) Assuming a favorable decision by the California Commission, we shall request that SBC provide similar treatment for all of you living outside of California. You will be pleased to learn the Officers and Directors of our Association were invited to a Health Benefit conference in San Ramon, California on Thursday, August 4th by Ms. Karen Jennings, Sr. Exec., V.P. (HR/Communications). Attending for SBC were Mr. Chuck Smith (President/CEO, SBC West), Mr. Jim Beck (V.P./;HR, SBC West), Ms. Sue Colburn (V.P./Benefits), Ms. Debbie Trammell (Exec. Dir./Health Ops), Mr. Marty Webb (Assist. V.P./Benefit Ops), Ms. Kristie Sadlon (Assoc. Dir./Benefit Design), Ms. Karen Heinkel (Assoc. Dir./Health Ops) and Ms. Norma Gonzales (Exec. Dir./HR). The primary purpose of this conference was to review the new Management Health Benefit Plan which is to become effective January 1, 2006. (See enclosed copy of our agenda) The conclusions of this conference were that approximately 90% of active and retired managers will realize a reduction in their total health benefit expenses. Those retirees living “outside” of a designated “Network” should consider to “Opt-In” in order to receive the same cost benefits to those “inside” a designated “Network.” (If you refer to your company provided material, you will recognize the significant cost reductions available to you through the “Opt-In” privilege.) For those of you currently involved in an HMO, (especially those being served by Health Net, Kaiser and Pacific Care) SBC representatives stated, these HMO’s are providing retirees with superior health services and are well managed. SBC must await Medicare’s annual negotiations with all Health Management Organizations (HMO’s) before new contracts can be negotiated. Ms. Norma Gonzales (Exec. Dir./HR) distributed an SBC announcement highlighting a “new telephone concession service reimbursement plan for retirees living outside of an SBC service area.” (600 minutes of long distance service for $25.00 monthly, and no more Acordia!) We responded by announcing some Association members were already encountering difficulties with this “new plan” since “serving companies” were not amenable to this arrangement. (Ms. Gonzales acknowledged the complaint and indicated SBC was working to resolve the issue.) Your President announced during the conference the TelCo Retirees Association had received formal notification from the California Public Utilities Commission that a prehearing conference has been set for September 2, 2005 for a review of our formal complaint on retirees’ telephone concession service based upon retiree documents and System Instruction 25, dated July 1, 1985, which states, “Employees whose telephone service is provided by another company are to receive a fixed monthly payment based on the Class of concession the employee is entitled to receive.” Employees who retired before or after 1-1-84 are entitled to a fixed payment of $35.00 monthly. (Those who retired before 1-1-84 are exempt from federal taxes for their concession service.) They are also entitled to a monthly payment of $13.50 for a second residence. Pacific Bell retirement documents state, “Retirees are entitled to 100% of exchange service, $13.50 for a second residence and $20.00 toll allowance!” The SBC representatives at the conference reflected a total surprise at the above announcement!) In closing, our TelCo Retirees Association, Inc. now exceeds 2000 members in 40 states but we need your individual help in “recruiting” fellow retirees to our cause. With over 19,000 Pacific Bell/Nevada Bell retirees receiving benefits, they need to become part of our Association’s efforts to “protect, enhance and assure the continuation of retirees’ pensions and other benefits promised by the company at the time of their retirement.” (Mr. Jack Land, Vice President and Membership Chairman, will welcome all suggestions and recommendations.) Please send this material to your friends and former company associates. You may also wish to tell those with email to visit our Website (www.telcoretirees.org). A membership application may be downloaded from our Website. Sumner K. Emery, President P.S. A reminder…General Membership Meeting, Elks Lodge, 5631 Cypress Avenue, Carmichael, CA, Wednesday, September 28th , 9:00 A.M./12:30 P.M. (Please let us know of your attendance plans, including guests.) SBC/TelCo Retirees Association Meeting Health Benefit Program Changes-January 1, 2006 San Ramon, CA August 4, 2005 The Officers and Directors of the TelCo Retirees Association, Inc. have diligently perused the SBC Benefits Update describing the SBC Medical Plan that replaces CustomCare and ConsumerWise in 2006. The proposal advances the philosophy of “distributing costs to all participants based on their individual use of health care services.” While this concept would seem to merit the general support of retired and active SBC managers, it contains a machiavellian element that, left unchanged, will be devastating to the vast majority of retired managers. Areas of vital concern to retired managers impacted by the new health benefit plan include Annual Deductibles For Medical Services, Out-Of-Pocket Maximums and the 40% co-insurance for Non-Network Services covered by the plan. Requiring an SBC management retiree (with spouse) to meet a “monthly contribution” of $179.00 ($2,148.00 annually) and a “monthly deductible” of $478.00 ($5,738.00 annually) plus a 40% co-insurance payment for any Non-Network Service covered by the plan is a radical departure from all previous Pacific Bell/SBC Health Benefit Plans. Here, for discussion in today’s conference, are proposed SBC health benefit issues the TelCo Retirees Association feels are inchoate and require resolution. A. Management retirees who retired from Pacific Telesis after 1-2-91 (and who pay a “contribution” ) are to be impacted by this new health benefit program. (The Association finds SBC’s planned implementation date of 1-2-91 compelling since it coincided with the U.S. West, Inc. Employees’ Benefit Committee decisions of January 8, 1996. During that meeting, the U.S. West Employees’ Benefit Committee passed the following resolutions. “For all pre-1991 retirees: …Medical and dental coverage for life …Same overall percentage of annual out-of-pocket costs (deductibles,co-payments, etc.) as under the 1990 plans to be paid by retirees: …No premiums and continued payment of Medicare Part B premiums by the company. …The company will never require pre-1991 retirees to use a limited network of healthcare providers (i.e., they will not be forced to use HMO’s) unless that is the only way health care is available (due to health-care market or legislative changes.) Resolved: That in accordance with the appeals submitted by (Curtis Kennedy, Attorney) the Employees’ Benefit Committee agrees to an amendment specifying that U.S. West will continue to meet its previously announced commitment to provide healthcare coverage for those retired pre-1991 and those retired in accordance with the 1992 enhanced retirement offer (ERO).” (Does the action undertaken by the U.S. West Employees’ Benefit Committee, in recognizing pre-1991 retirees health benefit plans, have a bearing upon the same date chosen by the SBC Corporation for the introduction of the proposed 2006 management health plan?) B. 33,000 SBC management retirees impacted. (How many Pac Bell retirees will be impacted by the introduction of the SBC Health Benefit Plan?) C. Philosophy - “Distribute cost to participants based on their individual use of health care services,” (Won’t this decision cause “illness prone” retirees, through no fault of their own, to incur astronomical health care expenses?) D. Deductibles “2005 annual deductibles for the SBC Medical Plan may be adjusted in 2006* (How does government indexing impact deductibles?) E. Network-Outside Network Areas (Per Ms. Trammell: “Yearly we assess what zips fall into the service areas for the Network service area across every state for every zip code. The criteria requires you have: 2 PCPs, 2 OB/GYNs and 2 Pediatric PCPs within 5 miles and 1 network hospital within 15 miles then you are in the Network service area. If not, you are considered Outside Network Area (ONA) and you may choose to opt into the Network and then all claims are paid at the Network level if you use a Network provider or facility. If you opt in and do not use a Network provider, then all claims are paid at the Non-Network level. Annually the ONA person can decide to move back to ONA during Annual Enrollment. Otherwise, they stay opted into the Network until the person changes that during Annual Enrollment.) Many TelCo Retirees Association members live “outside the definition” of “network service area” and do not have access to a hospital “within 15 miles” or a physician “within 5 miles.” If they choose to “opt in,” how can they avoid the expense of using Non-Network Providers? (Here is a partial listing of TelCo Retirees Association members whose residence may be “outside” of a “Defined Network Area“) 1401 Harvard Dr., DeRidder, LA 70634 General Delivery, Lake City, TN 37769 1523 Glencoe Rd., Fairhope, PA 15538 51 Lana St., Pala, HI 96779 22943 Lawlis Rd., Siloam Springs, AR 92761 P.O. Box 749, Port Hadlock, WA 98339 812 Chadbourne Ave., Concord, NC 28027 P.O. Box 59, Fayetteville, WV 25840 1030 S. Lincoln St., Casper, WY 82601 P.O. Box 536, Union, WA 98592 46 Eagle Crest Dr., #400, Lake Oswego, OR 97035 752 E. Wagonmaster Rd., Washington, UT 84780 P.O. Box 194, Thomaston, ME 04861 15 Sunset Lane, Anaconda, MT 59711 233 Northwoods Dr., Merlin, OR 97532 646 Crest Lane, Sedro Woolly, WA 98284 1015 N. Sugar Maple Trl., Postfalls, ID 83854 P.O. Box 563 , Hatch, UT 84735 194 Buffalo Street, Jamestown, NY 14701 2112 Rodman Bl., Gllitin, TN 37066 81950 Makahiki Lane, Captain Cook, HI 96704 516 Center St., Winona, MN 55987 1655 “P” Rd., Loma, CO 81524 161 Oakland Ave., Staten Island, NY 10310 948 SE Loren Lane, Toledo, OH 97391 We are interested in learning if the above retiree addresses fall “inside” or “outside” of a Network Area. F. The Annual Deductibles (Out-of-Pocket Maximums) “Have been established to limit financial responsibility.” Retirees earning more than $50,000.00 a year at retirement Network Deductibles (Individual Maximum) $5,100.00. Network Deductibles (Two Person Maximum) $7,650.00 Non-Network Deductibles (Individual Maximum} $15,300.00 Non-Network Deductibles (Two Person Maximum) $30,600.00 Retirees earning less than $50,000.00 a year at retirement Network Deductibles (Individual Maximum) $3,825.00 Network Deductibles (Two-person Maximum) $5,738.00 Non-Network Out-of-Pocket - (Individual) Maximum) $15,300.00 Non-Network Out-of-Pocket - (Two-person Maximum) $30,600.00 (What formula was utilized to establish these deductibles?) HMOs The SBC Benefits Update (June 2005) states, “Will HMOs connected with the SBC Medical Plan be impacted by this new change? There will be changes to contributions as described above. SBC has informed the HMOs it has relationships with about the introduction of the new plan. SBC is implementing a very efficient plan, one that may be challenging for some HMOs to compete against, but one that we feel sets the right cost structure for participants and for the company. SBC has encouraged all of the HMOs to offer comparable competitive offerings.” (During your recent meeting with the Ameritech Retiree Association in Chicago, a statement was made, “HMO offerings will be presented to all employees and retirees as usual during the October-November time frame. The management retirees who will have the new SBC Medical Plan will be given an enrollment worksheet listing the HMO offerings available for their home zip code in October. The targeted mail date will be around October 19. The enrollment period for this group is from October 27-November 16 at 7:00 P.M. Central Time. As we get closer to annual enrollment, information will be mailed informing you and others when your enrollment begins.”) (Recognizing the magnitude of negotiations being conducted between SBC Health Benefits and the various HMOs, as well as the decisions being made that will impact corporate and retiree contributions, some delay in announcing new HMO agreements is understandable. Nonetheless, since a great many of our Pacific Bell retirees now participating in various HMOs may be forced ,through no fault of their own, to undertake a drastic change in their benefit plans, an earlier communication with them would materially alleviate their concerns.) Respectfully submitted, Sumner K. Emery, President August 17, 2005 Garrett L. Wong, Sr. Attorney SBC California Legal Department 140 New Montgomery Street, R. 1619 San Francisco, CA 94105 Dear Mr. Wong: Pursuant to the request in your communications to me dated July 15, 2005, I am responding to the SBC California’s First Set of Data Requests. Request Number 1: Please provide any and all documents that support the allegation “official corporate documents provided to retirees upon their retirements from Pacific Bell (SBC) specifically delineated their rights to telephone concession services (whether living in or outside of an SBC service area).” Enclosed you will find copies of corporate documents mailed to eleven (11) Pacific Bell (SBC) retirees attesting to their corporate rights for telephone concession service. The eleven (11) documents described above were provided by the following retirees: Mr. Robert P. Colson, 16041 Cumberland Way, Bullard, TX 75757, Mr. Richard L. Arkin, 11409 Muller Street, Santa Fe Springs, CA 90670, Ms. Barbara England, P.O. Box 460 Alba, MO 64830, Mr. H. P. Trivitt, 1682 Central Avenue, Napa, CA 94558, Mr. and Mrs. Dale George, P.O. Box 1330 Georgetown, CA 95634, Ms. Marilyn Swift, 2317 NW Tower Rock Rd., Bend OR 97701, Ms. Cleo Davidson, 11315 Rolling Hills Dr., Dublin, CA 94568, Mrs. Nadine F. Yaple, 25695 Chimney Rock Rd., Valencia, CA 91355, Mr. Alexander P. Falck, 8883 Callita St., San Gabriel, CA 91775, Mrs. Frances E. James, Rt. 2, Box 3020, Escondido, CA 92025, Mr. Eugene Moore, 2666 Worden St., San Diego, CA 92110. Request Number 2: Please provide any and all documents that support the allegation “additional documents issued by the SBC Corporation to these customers over the years referenced qualified retirees’ rights to this telephone concession benefit.” Enclosed you will find ten (10) Pacific Telephone/Pacific Bell corporate documents attesting to retirees’ “rights to this telephone concession service benefit.” Request Number 3: Please provide the letter mailed to retirees by the Assistant Secretary, General Employees’ Benefit Committee, issued January 1991, that contains the statement, “If you have returned from Pacific Bell or Nevada Bell and your telephone service is provided by Pacific Bell or Nevada Bell then your concessionable service is automatically changed to Class R or D.” Enclosed, as requested, is a copy of the document. The page referenced in your request will be found on Page 52. Your request contained the statement, “If you have returned from Pacific Bell or Nevada Bell.” The actual statement in the Assistant Secretary General Employees’ Benefit Committee statement reads, “If you have retired from.” My copy of this document only contains the pages submitted with this letter. I will be expecting to receive the complete document with the other pages. Request Number 4: Unless the letter sought in request Number 3 is responsive to this request, please provide the document that contains the statement, “If you have retired from Pacific Bell or Nevada Bell and your service is provided by another company, the Retiree Services Group Concession Unit will arrange for you to receive taxable fixed monthly payments.” My response to your Request Number 3 answered this request. Request Number 5: Please provide any and all documents that support the allegation, “that SBC made a contractual commitment to retirees and that commitment is not subject to unilateral revision.” Enclosed is a copy of System Instruction 25 (Employee Concession Telephone Service) dated 7-1-85 . The following sections/paragraphs are germane to the CPUC complaint (C.05-05). Section I, page 1, page 2, page 5 and page 11. Section II, page 1, page 13 ad page 14. Section III, page 3, page 4, page 5, page, 6 and page 8. Section IV, page 5 and page 13. Telephone Concession Service as a “contractual issue” was decisive in the Colvin V Qwest Communications International, Inc. (Class Action Lawsuit Case # 04-CV-39, Otero County District Court, Colorado) This Class Action complaint with a demand for a jury trial stated, “The telephone concession reimbursement” has been an established contractual commitment in existence at Qwest and predecessor companies for more than forty (40) years. The “telephone concession reimbursement” is not governed by the Employee Retirement Income Security Act of 1974 (ERISA) and is not a welfare benefit plan. The “telephone concession reimbursement” specifically fits within the exemption outlined by the Department of Labor’s regulation, 29 C.F.R.2510.3-1 (e), because it is a discount on a commodity of the kind which Qwest offers for sale in the regular course of business. The Class Action lawsuit was adjudicated in the Sixteenth Judicial District Court, Otero County Courthouse by Judge William Neighbors on September 14, 2004 and resulted in an agreement that benefited over 4,000 Qwest retirees for the loss of their telephone concession service. Sumner K. Emery, President TelCo Retirees Association, Inc. Click here for print friendly version of this Newsletter. Click here for MS Word version of this Newsletter. Reminder to Members: Please notify us at Info@TelCoRetirees.org if you change your e-mail address so that you will continue to receive messages from our office.
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August 2005

TelCo Retirees Association, Inc.

August 15, 2005

Dear Member:

The TelCo Retirees Association has received a Notice of Prehearing Conference by the Public Utilities Commission of the State of California. “Notice is hereby given that the Public Utilities Commission has set a prehearing conference in the above-entitled matter before Administrative Law Judge Victor D. Ryerson, for September 2, 2005, at 10:00 A.M. in the Commission Court Room, State Office Building, 505 Van Ness Avenue, San Francisco, California.” A prehearing conference is called to determine the parties, positions of the parties, issues, and other procedural matters.

Our Association’s response to the attorney for SBC (Mr. Wong) was priority mailed, confirmation on Wednesday, August 10, 2005. (See enclosure)

Based upon the evidence submitted, your Association remains confident we will prevail in this formal Commission complaint to restore the telephone concession service you were promised at the time of your retirement. (Please keep in mind this complaint only involves retirees living within the state of California.) Assuming a favorable decision by the California Commission, we shall request that SBC provide similar treatment for all of you living outside of California.

You will be pleased to learn the Officers and Directors of our Association were invited to a Health Benefit conference in San Ramon, California on Thursday, August 4th by Ms. Karen Jennings, Sr. Exec., V.P. (HR/Communications). Attending for SBC were Mr. Chuck Smith (President/CEO, SBC West), Mr. Jim Beck (V.P./;HR, SBC West), Ms. Sue Colburn (V.P./Benefits), Ms. Debbie Trammell (Exec. Dir./Health Ops), Mr. Marty Webb (Assist. V.P./Benefit Ops), Ms. Kristie Sadlon (Assoc. Dir./Benefit Design), Ms. Karen Heinkel (Assoc. Dir./Health Ops) and Ms. Norma Gonzales (Exec. Dir./HR).

The primary purpose of this conference was to review the new Management Health Benefit Plan which is to become effective January 1, 2006. (See enclosed copy of our agenda) The conclusions of this conference were that approximately 90% of active and retired managers will realize a reduction in their total health benefit expenses. Those retirees living “outside” of a designated “Network” should consider to “Opt-In” in order to receive the same cost benefits to those “inside” a designated “Network.” (If you refer to your company provided material, you will recognize the significant cost reductions available to you through the “Opt-In” privilege.)

For those of you currently involved in an HMO, (especially those being served by Health Net, Kaiser and Pacific Care) SBC representatives stated, these HMO’s are providing retirees with superior health services and are well managed. SBC must await Medicare’s annual negotiations with all Health Management Organizations (HMO’s) before new contracts can be negotiated.

Ms. Norma Gonzales (Exec. Dir./HR) distributed an SBC announcement highlighting a “new telephone concession service reimbursement plan for retirees living outside of an SBC service area.” (600 minutes of long distance service for $25.00 monthly, and no more Acordia!) We responded by announcing some Association members were already encountering difficulties with this “new plan” since “serving companies” were not amenable to this arrangement. (Ms. Gonzales acknowledged the complaint and indicated SBC was working to resolve the issue.)

Your President announced during the conference the TelCo Retirees Association had received formal notification from the California Public Utilities Commission that a prehearing conference has been set for September 2, 2005 for a review of our formal complaint on retirees’ telephone concession service based upon retiree documents and System Instruction 25, dated July 1, 1985, which states, “Employees whose telephone service is provided by another company are to receive a fixed monthly payment based on the Class of concession the employee is entitled to receive.” Employees who retired before or after 1-1-84 are entitled to a fixed payment of $35.00 monthly. (Those who retired before 1-1-84 are exempt from federal taxes for their concession service.) They are also entitled to a monthly payment of $13.50 for a second residence.

Pacific Bell retirement documents state, “Retirees are entitled to 100% of exchange service, $13.50 for a second residence and $20.00 toll allowance!” The SBC representatives at the conference reflected a total surprise at the above announcement!)

In closing, our TelCo Retirees Association, Inc. now exceeds 2000 members in 40 states but we need your individual help in “recruiting” fellow retirees to our cause. With over 19,000 Pacific Bell/Nevada Bell retirees receiving benefits, they need to become part of our Association’s efforts to “protect, enhance and assure the continuation of retirees’ pensions and other benefits promised by the company at the time of their retirement.” (Mr. Jack Land, Vice President and Membership Chairman, will welcome all suggestions and recommendations.)

Please send this material to your friends and former company associates. You may also wish to tell those with email to visit our Website (www.telcoretirees.org). A membership application may be downloaded from our Website.

Sumner K. Emery, President

P.S. A reminder…General Membership Meeting, Elks Lodge, 5631 Cypress Avenue, Carmichael, CA, Wednesday, September 28th , 9:00 A.M./12:30 P.M. (Please let us know of your attendance plans, including guests.)

SBC/TelCo Retirees Association Meeting

Health Benefit Program Changes-January 1, 2006
San Ramon, CA
August 4, 2005

The Officers and Directors of the TelCo Retirees Association, Inc. have diligently perused the SBC Benefits Update describing the SBC Medical Plan that replaces CustomCare and ConsumerWise in 2006. The proposal advances the philosophy of “distributing costs to all participants based on their individual use of health care services.” While this concept would seem to merit the general support of retired and active SBC managers, it contains a machiavellian element that, left unchanged, will be devastating to the vast majority of retired managers.

Areas of vital concern to retired managers impacted by the new health benefit plan include Annual Deductibles For Medical Services, Out-Of-Pocket Maximums and the 40% co-insurance for Non-Network Services covered by the plan.

Requiring an SBC management retiree (with spouse) to meet a “monthly contribution” of $179.00 ($2,148.00 annually) and a “monthly deductible” of $478.00 ($5,738.00 annually) plus a 40% co-insurance payment for any Non-Network Service covered by the plan is a radical departure from all previous Pacific Bell/SBC Health Benefit Plans.

Here, for discussion in today’s conference, are proposed SBC health benefit issues the TelCo Retirees Association feels are inchoate and require resolution.

A. Management retirees who retired from Pacific Telesis after 1-2-91 (and who pay a “contribution” ) are to be impacted by this new health benefit program.

(The Association finds SBC’s planned implementation date of 1-2-91 compelling since it coincided with the U.S. West, Inc. Employees’ Benefit Committee decisions of January 8, 1996.

During that meeting, the U.S. West Employees’ Benefit Committee passed the following resolutions.

“For all pre-1991 retirees:

…Medical and dental coverage for life

…Same overall percentage of annual out-of-pocket costs (deductibles,co-payments, etc.) as under the 1990 plans to be paid by retirees:

…No premiums and continued payment of Medicare Part B premiums by the company.

…The company will never require pre-1991 retirees to use a limited network of healthcare providers (i.e., they will not be forced to use HMO’s) unless that is the only way health care is available (due to health-care market or legislative changes.)

Resolved: That in accordance with the appeals submitted by (Curtis Kennedy, Attorney) the Employees’ Benefit Committee agrees to an amendment specifying that U.S. West will continue to meet its previously announced commitment to provide healthcare coverage for those retired pre-1991 and those retired in accordance with the 1992 enhanced retirement offer (ERO).”

(Does the action undertaken by the U.S. West Employees’ Benefit Committee, in recognizing pre-1991 retirees health benefit plans, have a bearing upon the same date chosen by the SBC Corporation for the introduction of the proposed 2006 management health plan?)

B. 33,000 SBC management retirees impacted.

(How many Pac Bell retirees will be impacted by the introduction of the SBC Health Benefit Plan?)

C. Philosophy - “Distribute cost to participants based on their individual use of health care services,”

(Won’t this decision cause “illness prone” retirees, through no fault of their own, to incur astronomical health care expenses?)

D. Deductibles “2005 annual deductibles for the SBC Medical Plan may be adjusted in 2006*

(How does government indexing impact deductibles?)

E. Network-Outside Network Areas

(Per Ms. Trammell: “Yearly we assess what zips fall into the service areas for the Network service area across every state for every zip code. The criteria requires you have: 2 PCPs, 2 OB/GYNs and 2 Pediatric PCPs within 5 miles and 1 network hospital within 15 miles then you are in the Network service area. If not, you are considered Outside Network Area (ONA) and you may choose to opt into the Network and then all claims are paid at the Network level if you use a Network provider or facility. If you opt in and do not use a Network provider, then all claims are paid at the Non-Network level. Annually the ONA person can decide to move back to ONA during Annual Enrollment. Otherwise, they stay opted into the Network until the person changes that during Annual Enrollment.)

Many TelCo Retirees Association members live “outside the definition” of “network service area” and do not have access to a hospital “within 15 miles” or a physician “within 5 miles.” If they choose to “opt in,” how can they avoid the expense of using Non-Network Providers?

(Here is a partial listing of TelCo Retirees Association members whose residence may be “outside” of a “Defined Network Area“)

1401 Harvard Dr., DeRidder, LA 70634
General Delivery, Lake City, TN 37769
1523 Glencoe Rd., Fairhope, PA 15538
51 Lana St., Pala, HI 96779
22943 Lawlis Rd., Siloam Springs, AR 92761
P.O. Box 749, Port Hadlock, WA 98339
812 Chadbourne Ave., Concord, NC 28027
P.O. Box 59, Fayetteville, WV 25840
1030 S. Lincoln St., Casper, WY 82601
P.O. Box 536, Union, WA 98592
46 Eagle Crest Dr., #400, Lake Oswego, OR 97035
752 E. Wagonmaster Rd., Washington, UT 84780
P.O. Box 194, Thomaston, ME 04861
15 Sunset Lane, Anaconda, MT 59711
233 Northwoods Dr., Merlin, OR 97532
646 Crest Lane, Sedro Woolly, WA 98284
1015 N. Sugar Maple Trl., Postfalls, ID 83854
P.O. Box 563 , Hatch, UT 84735
194 Buffalo Street, Jamestown, NY 14701
2112 Rodman Bl., Gllitin, TN 37066
81950 Makahiki Lane, Captain Cook, HI 96704
516 Center St., Winona, MN 55987
1655 “P” Rd., Loma, CO 81524
161 Oakland Ave., Staten Island, NY 10310
948 SE Loren Lane, Toledo, OH 97391

We are interested in learning if the above retiree addresses fall “inside” or “outside” of a Network Area.

F. The Annual Deductibles (Out-of-Pocket Maximums) “Have been established to limit financial responsibility.”

Retirees earning more than $50,000.00 a year at retirement

Network Deductibles (Individual Maximum) $5,100.00.

Network Deductibles (Two Person Maximum) $7,650.00

Non-Network Deductibles (Individual Maximum} $15,300.00

Non-Network Deductibles (Two Person Maximum) $30,600.00

Retirees earning less than $50,000.00 a year at retirement

Network Deductibles (Individual Maximum) $3,825.00

Network Deductibles (Two-person Maximum) $5,738.00

Non-Network Out-of-Pocket - (Individual) Maximum) $15,300.00

Non-Network Out-of-Pocket - (Two-person Maximum) $30,600.00

(What formula was utilized to establish these deductibles?)

HMOs

The SBC Benefits Update (June 2005) states, “Will HMOs connected with the SBC Medical Plan be impacted by this new change? There will be changes to contributions as described above. SBC has informed the HMOs it has relationships with about the introduction of the new plan. SBC is implementing a very efficient plan, one that may be challenging for some HMOs to compete against, but one that we feel sets the right cost structure for participants and for the company. SBC has encouraged all of the HMOs to offer comparable competitive offerings.”

(During your recent meeting with the Ameritech Retiree Association in Chicago, a statement was made, “HMO offerings will be presented to all employees and retirees as usual during the October-November time frame. The management retirees who will have the new SBC Medical Plan will be given an enrollment worksheet listing the HMO offerings available for their home zip code in October. The targeted mail date will be around October 19. The enrollment period for this group is from October 27-November 16 at 7:00 P.M. Central Time. As we get closer to annual enrollment, information will be mailed informing you and others when your enrollment begins.”)

(Recognizing the magnitude of negotiations being conducted between SBC Health Benefits and the various HMOs, as well as the decisions being made that will impact corporate and retiree contributions, some delay in announcing new HMO agreements is understandable. Nonetheless, since a great many of our Pacific Bell retirees now participating in various HMOs may be forced ,through no fault of their own, to undertake a drastic change in their benefit plans, an earlier communication with them would materially alleviate their concerns.)

Respectfully submitted,
Sumner K. Emery, President
August 17, 2005

Garrett L. Wong, Sr. Attorney

SBC California Legal Department 140
New Montgomery Street, R. 1619
San Francisco, CA 94105

Dear Mr. Wong:

Pursuant to the request in your communications to me dated July 15, 2005, I am responding to the SBC California’s First Set of Data Requests.

Request Number 1: Please provide any and all documents that support the allegation “official corporate documents provided to retirees upon their retirements from Pacific Bell (SBC) specifically delineated their rights to telephone concession services (whether living in or outside of an SBC service area).”

Enclosed you will find copies of corporate documents mailed to eleven (11) Pacific Bell (SBC) retirees attesting to their corporate rights for telephone concession service.

The eleven (11) documents described above were provided by the following retirees:

Mr. Robert P. Colson, 16041 Cumberland Way, Bullard, TX 75757, Mr. Richard L. Arkin, 11409 Muller Street, Santa Fe Springs, CA 90670, Ms. Barbara England, P.O. Box 460 Alba, MO 64830, Mr. H. P. Trivitt, 1682 Central Avenue, Napa, CA 94558, Mr. and Mrs. Dale George, P.O. Box 1330 Georgetown, CA 95634, Ms. Marilyn Swift, 2317 NW Tower Rock Rd., Bend OR 97701, Ms. Cleo Davidson, 11315 Rolling Hills Dr., Dublin, CA 94568, Mrs. Nadine F. Yaple, 25695 Chimney Rock Rd., Valencia, CA 91355, Mr. Alexander P. Falck, 8883 Callita St., San Gabriel, CA 91775, Mrs. Frances E. James, Rt. 2, Box 3020, Escondido, CA 92025, Mr. Eugene Moore, 2666 Worden St., San Diego, CA 92110.

Request Number 2: Please provide any and all documents that support the allegation “additional documents issued by the SBC Corporation to these customers over the years referenced qualified retirees’ rights to this telephone concession benefit.”

Enclosed you will find ten (10) Pacific Telephone/Pacific Bell corporate documents attesting to retirees’ “rights to this telephone concession service benefit.”

Request Number 3: Please provide the letter mailed to retirees by the Assistant Secretary, General Employees’ Benefit Committee, issued January 1991, that contains the statement, “If you have returned from Pacific Bell or Nevada Bell and your telephone service is provided by Pacific Bell or Nevada Bell then your concessionable service is automatically changed to Class R or D.”

Enclosed, as requested, is a copy of the document. The page referenced in your request will be found on Page 52. Your request contained the statement, “If you have returned from Pacific Bell or Nevada Bell.” The actual statement in the Assistant Secretary General Employees’ Benefit Committee statement reads, “If you have retired from.”

My copy of this document only contains the pages submitted with this letter. I will be expecting to receive the complete document with the other pages.

Request Number 4: Unless the letter sought in request Number 3 is responsive to this request, please provide the document that contains the statement, “If you have retired from Pacific Bell or Nevada Bell and your service is provided by another company, the Retiree Services Group Concession Unit will arrange for you to receive taxable fixed monthly payments.”

My response to your Request Number 3 answered this request.

Request Number 5: Please provide any and all documents that support the allegation, “that SBC made a contractual commitment to retirees and that commitment is not subject to unilateral revision.”

Enclosed is a copy of System Instruction 25 (Employee Concession Telephone Service) dated 7-1-85 . The following sections/paragraphs are germane to the CPUC complaint (C.05-05). Section I, page 1, page 2, page 5 and page 11. Section II, page 1, page 13 ad page 14. Section III, page 3, page 4, page 5, page, 6 and page 8. Section IV, page 5 and page 13.

Telephone Concession Service as a “contractual issue” was decisive in the Colvin V Qwest Communications International, Inc. (Class Action Lawsuit Case # 04-CV-39, Otero County District Court, Colorado)

This Class Action complaint with a demand for a jury trial stated, “The telephone concession reimbursement” has been an established contractual commitment in existence at Qwest and predecessor companies for more than forty (40) years. The “telephone concession reimbursement” is not governed by the Employee Retirement Income Security Act of 1974 (ERISA) and is not a welfare benefit plan. The “telephone concession reimbursement” specifically fits within the exemption outlined by the Department of Labor’s regulation, 29 C.F.R.2510.3-1 (e), because it is a discount on a commodity of the kind which Qwest offers for sale in the regular course of business.

The Class Action lawsuit was adjudicated in the Sixteenth Judicial District Court, Otero County Courthouse by Judge William Neighbors on September 14, 2004 and resulted in an agreement that benefited over 4,000 Qwest retirees for the loss of their telephone concession service.

Sumner K. Emery, President
TelCo Retirees Association, Inc.
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