Sunday, October 17, 2010

NFL Armageddon 2011 – reading between the lines

Week six of the 2010 National Football League season ends tonight with the Monday Night game between the Tennessee Titans heading to of all places Jacksonville’s EverBank Field for a rare Monday night game in Jacksonville. On the field the pretenders and the contenders continue to separate themselves. Off the field an “NFL official” not named commissioner Roger Goodell is scheduled to meet with Brent Favre to review the allegations published at However as the NFL nears the halfway mark for the 2010 season, more and more league officials and players continue to step closer and closer to the edge of the abyss – a lockout that could cripple the 2011 season.

It does not take a fortune teller to figure out what is taking place. Management continues to make serious but veiled threats to the players, while the players, team by team, continue to vote to decertify their union.

Late last week, Goodell directed one of those not so subtle threats at the players saying in no uncertain terms that if there is a work stoppage the players had better find their own medical coverage.

"That's a pretty good reason to come to the negotiating table and get a labor agreement," NFL commissioner Roger Goodell said last week. "That's pretty good motivation."

NFL players’ union officials have expressed concern that coverage will be disrupted if the CBA expires. Goodell said that is an issue for players to hash out with the union.

"It's been dealt with in other circumstances and other negotiating positions, where unions have arranged to pay for their COBRA care," Goodell said. "That's the issue. They'll continue to get medical care. It's just that the burden of paying for that will no longer be on the clubs, it would be on the individuals or on the union."

Wrote Miki Yaras-Davis, the NFLPA's senior director of benefits, in an e-mail to USA TODAY: "We have asked the NFL for confirmation of continuing coverage for months now. They have yet to confirm or commit to any kind of coverage."

Just what medical coverage do “current” NFL ‘enjoy’? This information comes from the best possible source on the issue, the NFLPA. Like many NFL players, retired wide receiver Karsten Bailey left college early to play professional football. When his NFL career ended, he was eager to return to school and finish his degree. Thanks to the NFL Player Insurance Plan, he could concentrate on his education and not worry about health insurance. The plan offers five years of continuing coverage for each player vested in the pension plan when his career ends. (Non-vested players receive coverage until the August 31 following their release.)

“It worked really well for me,” said Bailey, referring to the continued coverage. “I didn’t have to worry about that while I finished school.” Bailey’s coverage did not change; he only had to make sure his records were up to date so he would receive insurance cards and other materials from the plan.

“One decision players should not neglect is planning for their post-career health care needs,” said NFL Players Association Benefits Director Miki Yaras-Davis. “Health insurance can help families preserve their income in the face of a serious illness or injury.”

Veterans participating in the continuing coverage enjoy the same coverage they had as active players; the only thing that changes is their status. “The main difference between continuing veteran status and active status is that continuing veterans don’t have a club insurance plan representative to handle their transactions,” said NFLPA Benefits Manager Adora Williams. “Players leaving the game should be proactive in learning about the insurance plan and make sure a permanent home address is on file with the plan.”

The post-career insurance continuation was negotiated for players to help facilitate their transition into life after football. But after five years, Williams said, the continuation expires and players need to secure new coverage. For example, Bailey and several other vested players who left the NFL in 2003, plus non-vested players who do not get picked up for the 2008 season, lost their NFL coverage on August 31, 2008.

Players have federal protection when moving from one group insurance plan to another. The Health Insurance Portability and Accountability Act of 1996 (HIPAA) was enacted in part to help improve the portability and continuity of insurance coverage to make it easier for people to change jobs. “While HIPAA laws require group plans to guarantee availability, there is very limited protection in the individual insurance market,” Williams said “Players who do not have the group plan option need to prepare.”

Players who will lose coverage and do not qualify for another group plan have the following options:

1. COBRA. Players have the right to purchase a temporary extension of the NFL Player Insurance Plan coverage at group rates plus an administrative fee. There is no legwork involved and no medical underwriting. Players simply need to respond to the COBRA offering within 60 days and pay the premiums in order to elect and maintain coverage.

2. Individual Insurance Policy. Although the market for individual coverage is different in every state, these policies generally require medical underwriting and factors such as age, health status, pre-existing conditions and injuries can be serious obstacles. For players unable to obtain an insurance policy because of pre-existing conditions, many states have one that will not require medical review, but it will be more expensive. “Players who feel they will need an individual policy down the road may want to consider exhausting their COBRA coverage first,” said Williams. “There is some HIPAA protection in the individual market for pre-existing condition limitations if a player completely exhausts his COBRA and does not have a break in coverage for more than 63 days.”

Players can search for an individual policy by contacting insurance carriers directly or by contacting an insurance broker for assistance in choosing a plan.

“It is important to start the search for an individual policy early,” said Williams, “because the process can take several weeks, and there is a chance players will need to go through more than one carrier before they find an appropriate policy.”

For Bailey, who is currently earning his teaching credentials, the decision about future coverage was easy. “I hope to have a job by the time my insurance ends this summer,” he said. “If not I’ll probably elect the COBRA coverage.”

Those sentiments aside as has been well documented football takes a terrible toll on the bodies of those blessed to be offered a chance to play on Sunday’s. Given that the average NFL career is three years and coverage ends five years after players’ career ends, retired NFL players need medical coverage and benefits that will last their entire lifetime.

At their annual Super Bowl press conference NFLPA executive director DeMaurice Smith attempted to deal with the issue of how the NFL (and in this case the NFLPA) are treating their retired players, the players who built the NFL into a business that generates in excess of $6 billion annually.

Smith was quick to acknowledge the rift, stating that “when it comes to benefits for pre-1993 players the current system is not working.” He also recognized that active and former players compete over the same pool of money used for benefits. This announcement came prior to any mention of the currently strained labor negotiations between the owners and players that have filled the headlines lately. It is hoped that addressing this issue first at the press conference is indicative of the NFLPA’s new dedication to the players who helped build the NFL into the $8 billion industry that it is today.

Just as quickly as Smith acknowledged the rift between current and former players he stated his plan to begin addressing the issue. First, he announced that the Groom Law Group will no longer defend the Bert Bell/Pete Rozelle NFL Player Retirement Plan when it is sued by players seeking benefits. The Groom Law Group, a major source of frustration for many retired players, currently represents both the NFL and NFLPA against retired players suing the NFL’s disability plan when they are denied benefits. DeMaurice Smith announced the change will formally come next week and that the NFLPA has not yet chosen a firm to replace the Groom Law Group.

Next, Smith announced that he was calling for NFL owners to contribute two percent of their profits to a legacy fund for retired players. He stated that all benefits are funded through the active players’ portion of the revenue and called for NFL owners to share in the responsibility. “They (NFL owners) sell legacy, but they don’t pay for it,” Smith stated.

Smith then announced more changes to come to the NFL disability plan. He wants someone to assist the two members of the disability initial claims committee in their assessment of NFL players’ disability applications. Smith stated, “I want that person to be a medical professional.”

He stated he wants that medical professional to understand the role of multiple head and orthopaedic injuries and how they impact players once they leave the NFL. This leaves little doubt that the NFLPA will acknowledge concussions and the lasting effects of traumatic brain injuries suffered as an NFL player as NFL injuries for the purpose of evaluating disability applications. It is hoped that something can be done to correct the fact that this was not the belief when so many retired players were wrongfully denied benefits for their football related head injuries in the past.

It was refreshing to hear these words coming from the leader of the NFLPA regarding the union’s relationship with retired players. We hope that the union will evaluate its three retirement board representatives with the same scrutiny in which they examined the Groom Law Group. The NFLPA went to great lengths in choosing DeMaurice Smith as their leader. The same effort should go into finding the best three NFLPA representatives to manage the near $1 billion in assets of the Bert Bell/Pete Rozelle NFL Player Retirement Plan.

One of the fundamental issues the NFL and the NFLPA need to deal with the NFL’s pension plan and how it compares to other sports leagues. According to Mark Riddix,’s: The NFL’s pension plan could easily stand for “Not For Long,” with the average career lasting only three years – just enough to qualify for the league’s pension plan.

The league’s plan is based on years of service in the league. Players who retired in the ’80s and ’90s receive anywhere from $3,000-5,640 per month for every season played in the NFL. Newly retired players receive $5,640 dollars monthly for every year of service. Players with 10 years of service receive an additional retirement bonus in the form of an annuity.

Players are eligible to receive their full benefits at the age of 55. While the pension plan is much worse than other sports, the NFL does offer a generous 401(k) plan. The league matches every player’s contribution up to 200 percent.

And how does the NFL pension plan compare to other North American based sports leagues? This again from Riddix: NBA players have one of the most generous pension plans in all of professional sports. They are vested into their pension plans after playing at least three seasons in the league. The minimum benefit for a player that retires at the age of 62 is $56,988 per year – not a bad retirement for a three-year career. The maximum benefit for any player is $195,000, and it takes 11 years of NBA service to qualify for this benefit.

But that’s not all. NBA players are also eligible to participate in a league-sponsored 401(k). Do you think your 401(k) plan is good with a 50-percent matching policy? The NBA matches player’s contributions up to 140 percent.

Major League Baseball has the best pension program in all of sports, which should not come as a surprise given the strength of their union. A big-league player needs just 43 days of service to qualify for a pension benefit. Forty-three days of service can guarantee an MLB player a $34,000 per year pension benefit. One day on an active roster qualifies a player for full comprehensive medical benefits.

Major league baseball players become fully vested in their pensions after 10 years of service. It is not uncommon for retired baseball players with over 10 years of service to receive over $100,000 annually upon reaching the age of 62. Baseball has the most well-funded pension program with estimates valuing the plan at over half a billion dollars.

NHL players can start withdrawing their pension benefits at the age of 45. Players are not fully vested, however, until the age of 45. NHL pensions require that a player be active for at least 160 games to qualify for the maximum pension benefit. Players with less than 160 games of service receive the maximum benefit under Canadian law, and players with 160 games or more of service receive the maximum pension under U.S. law, which is $45,000 annually.

The PGA has the most convoluted pension plan of all of the major sports. The amount of money in a professional golfer’s retirement account is not guaranteed. It is based on their performance during the season, position on the money list and the number of cuts made during the season. Players are rewarded with contributions for participating in and playing well in tour events. Players earn funding as they participate in more and more tour events. Players also earn contributions of $3,800 and up for each cut that is made.

The best part of the PGA’s pension plan is that successful players can accumulate millions of dollars in their retirement account at the end of their career. The downside is that players that miss cuts and perform poorly will be left with virtually nothing in their pensions.

One of the fundamental issues the NFL and the NFLPA will face in their negotiations should be how ‘retired’ players are treated. The only issue with that – more often than not history tells us that current players, more often than not, are quick to toss the players who built the league under the bus. Why? – in order that they make as much money as they can in the short term. That is a classic case of short-sightedness as oppose to having a clear understanding of what the long term vision is. In this case it is all about greed and in this case greed is not good. Current NFL players need to understand the big picture; they need to appreciate how important and critical long-term disability is for everyone who plays one down on Any Given Sunday.

For this is Howard Bloom. Sources cited and used in this Insider Report: USA Today, and

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