Health care video addresses re-employed retirees
The Ohio Public Employees Retirement System has released the latest monthly health care chat with OPERS Health Care Director Marianne Steger.
In the June video, Steger addresses member questions related to recent OPERS decisions affecting health care for re-employed retirees.
You can click here to access the video, which we’ve posted on our YouTube channel.
Michael Pramik
Michael Pramik is communication strategist for the Ohio Public Employees Retirement System and editor of the PERSpective blog. As an experienced business journalist, he clarifies complex pension policies and helps members make smart choices to secure their retirement.
Let me rephrase this question. A retire/rehire, not eligible for Employer insurance, NOT medicare eligible – will there coverage be less and premiums more do to the new changes?
Bernadette,
The rates for 2016 have to be approved by the OPERS Board of Trustees. That hasn’t yet happened. You’ll see the details in the Health Care Bulletin that’s scheduled to be mailed in early August. You’ll also see the plan and the premiums detailed in the open enrollment kit for 2016, which will be sent to you in September.
–Ohio PERS
If I understand this whole thing correctly, the “cadillac tax” doesn’t go into effect until January 1, 2018. If that’s true, why are non-Medicare, re-employed retirees being hit with increased premiums for January 1, 2016?
And, when, exactly, do the new rates based upon years of service and age at retirement go into effect? I understand this will be phased in; if this is the case, what % increase can we expect to be hit with per year over how many years? Right now, it appears that with OPERS set to cover 75% of my medical premiums (age 60 at retirement with 30 years of service, retired in 2013), I am due to have a 500% increase in my premium once this new premium rate schedule goes into effect. Correct?
Anita,
We can’t tell you what exact percentage premium increase you will receive in the future. But you’re correct in stating that new allowance rates based on age and service are being phased in between 2016 and 2018. And that is why you might be seeing an increase your 2016 premiums. Premiums are not being increased because of the Cadillac tax.
In fact, OPERS is providing a partial premium reduction over the next three years to help retirees enrolled in our Medical Mutual plan adjust to higher costs. Those under 65 might see increases, however, in out-of-pocket expenses, deductibles and co-pays.
–Ohio PERS
Then it’s a coincidence that I, a non-Medicare re-employed retiree, have been put into a separate health care plan and told to pay an increased premium (~150%) beginning January 1, 2016? A friend, who is non-Medicare and NOT re-employed, did not receive this health care plan premium increase. According to the “new age and qualifying service retiree monthly allowance table” we both should be at the same 75% OPERS allowance.
Anita,
New allowance tables go into effect beginning next year. We’d discourage members from comparing their premiums to those of other individuals. If you have further questions, call us at 800-222-7377.
–Ohio PERS
This video does not help that much. I want to know what the changes are for the reemployed group under 65. Saying there will be minor changes means nothing. Are premiums going to be higher?
Is the deductible going to be larger?
Christopher,
The plan will be the same. The re-employed retirees will not have the benefit of a recently announced three-year partial premium reduction that we are making to help offset increases in out-of-pocket costs for those under 65.
–Ohio PERS
Steger states that the connector will have information on re-employed retirees, and that it may be awkward for changes in work status(cut-off) made during the open enrollment period.
As a currently re-employed retiree, who is over 65 without an option of an employer health plan,
and may fully retire by December, will the connector be able to still advice with the HRA.
Or if I stay re-employed, will the connector be able to advice on the OPERS re-employed group heath care plan option.
Can you clarify what is the re-employed group health care plan option and proposed coverages and costs?
Marc,
The non-Medicare re-employed plan design for 2016 will be exactly the same as the non-Medicare plan for those not re-employed. However, re-employed retirees will pay more in premiums than a similar retiree who is not re-employed. The amount varies, although there is less than a $75 monthly difference. You will receive your exact premium amount in early September when we send out open enrollment kits.
–Ohio PERS
I retired from ODOT in 2013. I returned on a part time basis. I understand that if I continue to work in 2016 that I will go into another insurance group. My question that I have is that I’m also a Township trustee and my pers is going into an annuity for both. Is the trustee job also considered to be employed in a pers job and will I have to quit that job also or move into the new insurance group.
Thanks, Bart
Bart,
Give us a call at 800-222-7377, and we can help you with that question.
–Ohio PERS
I think I understand the re-employed retirees situation but would you please confirm that, as a OPERS retiree currently receiving OPERS benefits, I can continue to be employed part-time as an adjunct instructor at a local community college and remain eligible to receive the Connector HRA for health care benefits in 2016? While I am teaching, I contribute to the STRS. I really appreciate the clarification!
Barbara,
If you are re-employed with an employer that does not pay into OPERS, then we don’t consider you a re-employed retiree. If you choose coverage through OPERS, it would be through the main Connector process.
–Ohio PERS
Ok, I’m trying to understand this and know it’s part of ACA that rehired employees need a separate ins. plan. But what I don’t understand is how my working part time (16hrs/week) with no benefits is going to cost OPERS any more money than if I was not working at all ? Second, Why not just set up another plan identical to the plan we now have and rename it for rehired retirees, this should not change any cost or benefits. Third, OPERS needs to take into account the Cadillac tax rate is a lot higher for those retirees that were in “high risk” employment, this applies to a lot more than just Police and Fire professions. Fourth, Why are we rushing this when it is not Federally mandated to begin in Jan 2018.
To counter your response of costing more in 2018 than in 2016, how will me working increase the cost of my insurance? Lastly, what happens when this is repealed prior to 2018 and OPERS has been charging us for a plan that was never Federally in effect, REFUND ?????
Tom,
The 2016 plan design for re-employed retirees will be the same as the plan for retired members. There will be a premium reduction over the next three years for retired members to help offset the increase in out-of-pocket costs.
As far as “high-risk” members are concerned, we are aware that there are higher thresholds for high risk professions; however, for OPERS, a very large proportion of our retirees will not meet this definition. The IRS has been petitioned by numerous entities requesting more guidance on how “high risk professions” will be treated when calculating aggregate value, excise tax and other issues. We are awaiting this technical guidance from the IRS.
Regarding your other questions, we are already over the lower threshold of $10,200 for retirees under 65, and we are just $250 less than the higher threshold for those 55 and over. So we have to start dealing with this now or retirees should expect huge reductions in one year when it hits.
–Ohio PERS
So, if you retired from an OPERS institution three years ago and was rehired four months later for part-time work, you will not be eligible for HRA. All along I have been getting information about how much money will be in my HRA account. Does it still go in there and held until I retire completely?
Linda,
We believe you are confusing the HRA (Health Reimbursement Arrangement) with the RMA (Retiree Medical Account) available to some OPERS members. The HRA won’t be funded until the beginning of 2016.
–Ohio PERS
When will a calculator be available to compare costs between the Connector plans and the OPERS reemployed retiree plan? (I am a 67 year old retiree, not eligible for my OPERS employer’s plan because I work too few hours.)
Mary Ann,
We plan to have a calculator available July 1 to run costs for our group re-employed plan. For the Connector, you’ll have to wait until October for Medicare to release rates for 2016.
–Ohio PERS
I am a part-time re-employed retiree, age 63, with the Columbus Recreation and Parks Department. How will the recent changes to the health care affect me in regards to my current position with the Columbus Recreation and Parks Department? How does the new pension package affect me?
Cynthia,
Please read this blog for more information about that. You can also look for a blog to be posted later this week that will touch on the 2016 health care plan for those under 65.
–Ohio PERS
I am 60, retiree I will be 61 in November, I just went back to work in an OPERS covered position full time. I am will be taking the Employer insurance plan and plan to drop the OPERS coverage during open enrollment in October 2015. I plan to retire by November 2019, when I turn 65 and am eligible for Medicare, How will these changes affect me and my spouse who will turn 65 a year earlier than me in 2018.
The reason I went back to work was because of the rising cost and the eventual drop of insurance coverage for my spouse. I fear this may back fire and I should work in the public sector part-time.
Thanks for your help.
Dee,
When you retire at 65 your insurance will be through the OPERS Medicare Connector. If that is in November 2019, your spouse no longer will be eligible for a health care allowance from OPERS.
–Ohio PERS
Michael,
This is my second attempt to get this question answered. I am a rehired employee that works full time with a OPERS employer, I will turn 65 in November 2019. I plan to retire after my birthday, upon turning 65, and I was going to apply to Medicare in December (within 6 month window), How will this effect my being in the Medicare Connector, I plan to return to OPERS insurance coverage as a supplemental to my Medicare Coverage, do I have this all wrong? How doe this effect me?
My spouse who would be no longer on OPERS will remain on my employer insurance, but what happens when he turns 65 in 2018, how will this effect him, he too is Medicare eligible?
Thank you.
DJ,
As we stated in this April 21 blog, your choices will be:
1. Select your employer’s coverage if the employer offers it, which is a requirement of our health care coverage.
2. Remain in the plan you selected through the Connector but without receiving your HRA allowance or being able to access funds you may have accumulated in the account. (There are plans available that offer premiums as low as zero dollars per month that could make this option more attractive.)
3. Leave the plan you selected through the Connector and enroll in the OPERS re-employed retiree plan. OPERS will provide the appropriate allowance similar to our current health care plan, based on age and service. If the allowance doesn’t cover the full premium, we would deduct the remaining amount from retirees’ pension benefits.
But really, you need to follow our communication on the Connector and all of our other health care information since you’re a few years from retiring.
–Ohio PERS
I am currently an UNDER 65 retiree, that is re-employed part-time, not eligible for my employer’s plan, and on the current OPERS Health Care Plan. As I have read that the new Re-Employed Plan “May or may not” have a higher premium, I have to assume that it will have a higher premium, and plan on returning to full retirement prior to the end of this calendar year.
My question is: When will I have to resign and return to full retirement to remain on the traditional OPERS Health Plan in 2016 without an interruption in benefits , and will this choice be listed on the “Open Enrollment” documents mailed out in early August ?
Bill,
For a re-employed retiree to go back to being just a retiree, the employer needs to certify to us the date on which it terminated the person’s employment. The traditional health care plan would begin the first of the following month.
–Ohio PERS
My wife and I (both under 65) are both retired State workers and have selected single coverage thru OPERS. She and I both are elected officials for the City. The City does not offer health insurance for elected officials. She and I receive a very small salary for our elected positions. How will this effect us?
Brent,
If you are a re-employed retiree and your employer doesn’t offer insurance, you each can opt for the OPERS plan for re-employed retirees in 2016. Please refer to our blog on this topic for more information.
–Ohio PERS
I am a re-employed retiree over 65 year of age who is considering retirement at the end of December 2015. My last day of employment would be Dec. 31st but I will receive a check in January since my employer holds back one week of pay plus would owe me a partial sick leave payment benefit. How does this check in 2016 impact the money placed in my HRA? Will I still get a January payment in the HRA since I actually terminated employment in 2015? If yes, when would this payment be made?
If I continue to work and retire during May 2016, will my first payment into the HRA occur in June 2016? Will I be free to select any of the connector options at that time including the supplement and gap plans without physical exams etc. ?
Tom,
Call us at 800-222-7377, and we’ll answer those questions for you.
–Ohio PERS
I am a 69 year old – re-employed OPERS Employee (part-time) and an OPERS retiree currently with Humana coverage. Enrolled in Medicare parts A and B. I love my job and would like to stay employed In my current position. Is there any plan that will allow me to do this?
Carol,
Yes. The plan that is outlined in the video you’re commenting on explains how this will work. You also might want to refer to our earlier blog on this topic. If you have further questions, call us at 800-222-7377.
–Ohio PERS
What consequences,if any, if I want to return to work for an establishment that does not have anything to do with OPERS? What would happen if I would return to work full time versus part time? Also, is there a limit to how much pay one could earn?
Joyce,
We’re not sure what details you’re asking about. But generally speaking, you are not considered a re-employed retiree, regarding OPERS pension or health care rules, if you retire and go to work in the private sector or in a public position that does not contribute to OPERS.
Call us at 800-222-7377 for information more specific to your situation.
–Ohio PERS