Answers to OPERS member questions

This month: We address the recent tariff announcements, and other issues

By Michael Pramik, Ohio Public Employees Retirement System

April 24, 2025 – Members and retirees often ask us questions through our social media channels that others could benefit from. Periodically we post these questions and answers in our PERSpective blog.

Q: I’ve been reading news articles about the tariffs that President Trump has proposed. How will these tariffs impact my pension?

A: Financial markets often react quickly and emotionally to the announcement of tariffs. However, the early reactions we’ve seen are less likely to impact institutional investors such as OPERS, which invest over a period of decades rather than days. OPERS diversifies the investments in its Defined Benefit and Health Care funds with a goal of earning consistent returns over a long-term horizon to mitigate the impact of sudden changes in the economic landscape.

In November 2024, OPERS enhanced its ability to handle market volatility by approving a 10% allocation to a new Defined Benefit Fund allocation called Risk Mitigation Strategies (RMS). In January, a similar approval and 10% allocation to RMS also was made to the OPERS Health Care Fund. This allocation includes investments that are not closely correlated with equity markets, providing better protection for the portfolios when stock prices decline.

Q: I’m looking to apply for a position that requires you to pay into OPERS. I have been paying into Social Security for more than 25 years. How would accepting the OPERS-contributing position affect my Social Security payouts when retiring?

A: If you accept an OPERS-contributing position, you will no longer be contributing toward Social Security retirement. You can see how that might impact your Social Security benefit by doing a benefit estimate through the Social Security Administration’s website. You’ll need to establish an online account there – it’s not difficult to do.

One thing we can say is that you will not be subjected to the former Windfall Elimination Provision, which was eliminated at the beginning of 2025.

Q: Can you briefly describe the circumstance(s) that would make a retiree eligible for Medicare Part A and Part B reimbursements? I’m particularly interested in the Medicare Part-B premium that I currently pay out-of-pocket.

A: Public employees hired prior to April 1986 were not required to pay Medicare tax through their public employer. If you did not pay this tax during your public employment career, you do not have access to Medicare Part A without paying a monthly premium. Ohio law allows OPERS to provide premium reimbursement to those who are not eligible for premium-free Medicare Part A.

Retirees with access to a Health Reimbursement Arrangement (HRA) can use their available funds to reimburse themselves for their Medicare Part B expenses.

Further information about the OPERS health care program and what we provide is available in the OPERS Health Care 2025 Program Guide, which you can find on our website.

Q: If inflation goes up, say, 15% one year and then the next year it doesn’t go up at all, does this mean that the OPERS cost-of-living adjustment will be 3% for the year inflation was 15% and then no COLA for the following year, for those who retired after 2013?

A: That is basically correct. Members with a retirement effective date prior to Jan. 7, 2013, automatically receive a 3% COLA. Those with a retirement effective date on or after that date have their adjustments based on the Consumer Price Index-W, the government’s inflation index for urban wage earners and clerical workers. If the CPI-W doesn’t change from the end of June in one year to the end of June of the following year, the inflation-based COLA for the next year would be zero.

Q: I will be retiring soon, and I’d like to get an idea what my monthly pension will be after taxes. What is the federal & state tax percentage deduction for pensions?

A: A pension benefit is considered taxable income, but OPERS cannot offer tax advice. Please consult with your tax adviser, or visit IRS.gov for further assistance.

Q: I am being asked to become an authorized caregiver for a retired OPERS member. What information do you need from me? 

A: There are several documents that authorized caregivers could be required to provide to OPERS in order to access the member’s account. They include an Authorization for Release of Account Information form, HIPAA authorization, a durable power of attorney and letters of guardianship.

You can find more information about caregivers on the OPERS website.