RETIREE INSURANCE BENEFITS

SECTION 1:  ELIGIBILITY 

Effective with the implementation of the Florida Retirement System’s (FRS) Investment plan alternative in 2002, eligibility for retiree insurance benefits will vary depending upon which FRS plan the employee has elected. 

FRS Pension Plan Retirees

To be eligible to continue benefits as a District retiree under the FRS Pension Plan, the employee must have a minimum of 6 years of service with the Martin County School District and must be activating their FRS pension upon separating from the District.  A decision to elect retiree benefits must be made within 30 days of retirement.  Failure to respond to enrollment indicates a refusal of coverage.  Once a benefit is refused or not elected, it may never be reinstated at a later date.  In other words, coverage can be discontinued at any time, but can only be added in limited situations. 

Please see rates (Section 5) for a discussion of how years of service with Martin County School District affect the rate you are charged. 

FRS Investment Plan Retirees

To be eligible to continue benefits as a District retiree under the FRS Investment Plan, the employee must meet the age and service requirements of the Pension Plan (age 62 and 6 years, or 30 years of service), or the retiree must have attained age 59-1/2 and have six years of service with the Martin County School District.

SECTION 2: RE-EMPLOYED RETIREES

• An employee that retires June 1st and is re-employed July 1st would be eligible for all employer-paid benefits August 1st.
• An employee that retires June 30th and is re-employed August 6th would be eligible for all employer-paid benefits October 1st.

SECTION 3: ALLOWABLE CHANGES

SECTION 4: MEDICAL PLAN CHOICES

Under 65

Retirees under age 65 have a choice of two medical insurance plans (In-Network plan or PPO plan). However, the retiree must continue the same insurance option that they are currently enrolled in when they leave employment with the District (In-Network plan must stay with the In-Network plan) unless the retiree relocates outside of the In-Network plan’s service area (see allowable changes). The retiree may change options during the District’s annual open enrollment or they may change to the PPO program at the time they permanently move out of the In-Network plan’s service area.

Over 65

Retirees over age 65 must enroll in the PPO program because it is the only insurance option that coordinates with Medicare’s Part A and Part B plans. The District’s insurance program is not a Medicare supplement. Instead, it acts like a secondary insurer.

Medicare Plans and Enrollment Requirements

Hospital Insurance (Part A)
Most people don't pay a premium for Part A because they or a spouse already paid for it through their payroll taxes while working. Medicare Part A (Hospital Insurance) helps cover inpatient care in hospitals, including critical access hospitals, and skilled nursing facilities (not custodial or long-term care). It also helps cover hospice care and some home health care. Beneficiaries must meet certain conditions to get these benefits.  The retiree should elect Medicare Part A when it is first offered to avoid a later enrollment penalty.

Medical Insurance (Part B)
Most people pay a monthly premium for Part B. Medicare Part B (Medical Insurance) helps cover doctors' services and outpatient care. It also covers some other medical services that Part A doesn't cover, such as some of the services of physical and occupational therapists, and some home health care. Part B helps pay for these covered services and supplies when they are medically necessary.  The retiree must elect Medicare Part B when offered to coordinate with the Martin County School District’s medical insurance plan and to avoid a later enrollment penalty.

Prescription Drug (Part D)
Most people will pay a monthly premium for Part D.  Starting January 1, 2006, prescription drug coverage was made available to everyone with Medicare through Part D.  Medicare’s Prescription Drug Coverage (Part D) is an insurance plan, so private companies provide the coverage.  Since private companies are providing the plan a monthly premium is charged for the coverage. 

For those individuals who elect Part D coverage, medical and prescription coverage under the Martin County School District will end for the individual and all covered dependents.  Once you cancel your medical benefit, you will waive your right to participate or enroll in the benefit at any time in the future.  The prescription drug benefit provided under the District’s health insurance program has been actuarially determined to be “creditable”.  This means that the District’s prescription drug coverage is as good as, or better than, the coverage provided under Medicare Part D.  Since the District’s coverage is “creditable”, there will be no premium penalties, should you decide to enroll in Medicare Part D at a later date. 

Important Notice about Medicaid and Medicare Part D
Please note that if you become eligible for Medicaid (or any other state or federal financial assistance programs), that the Centers for Medicare and Medicaid Services (CMS) may automatically enroll you in the Medicare Part D drug subsidy program, and enrolling in Medicare Part D  will terminate your medical coverage with the Martin County School District.  We suggest that you contact the Centers for Medicare and Medicaid Services (CMS) directly to prevent automatic enrollment into Medicare Part D drug subsidy program.  By contacting CMS, you can request that they never automatically enroll you into the Medicare Part D drug subsidy program.

Should you be automatically enrolled in the Medicare Part D drug subsidy program, please contact the Risk Management and Employee Benefits Department for assistance immediately.  Save all pieces of communication from Medicare, as this information will help us serve you.

SECTION 5: RATES

In accordance with bargaining unit agreements, the District will pay a percentage of the total cost for health insurance based on the In-Network level of benefit and the years of service with Martin County School District according to the following schedule:

The Florida Retirement System provides $5.00 per month for every year of eligible service to be used for medical insurance.  Therefore, the amount due to MCSD for health insurance is the greater of the premium due or the State Supplement.  Please see the current rate sheet for specific rates.

SECTION 6: LIFE INSURANCE

You may continue into retirement the District-paid term life insurance policy.  The benefit changes when you retire and will only include the basic life insurance, without the accidental death rider.   The insurance reduces beginning at age 65 with the last reduction at age 70.  See the table below for values and refer to your policy for more information.   Please see the current rate sheet for specific rates.

SECTION 7: DENTAL AND VISION INSURANCE

You may continue into retirement the District-paid dental or vision policies by paying the group rate.

You must continue the same dental insurance option you had when you were employed. You may change dental plans during annual enrollment. Please see the current rate sheet for specific rates.

SECTION 8: OTHER BENEFITS

You will need to contact any other insurance vendors directly to make payment arrangements. Please review your payroll stub for the names of other insurance vendors, for example Aflac. You should have policy information at home from these vendors that will contain a telephone number. If you need a phone number, please contact the Risk Management & Employee Benefits Department.

SECTION 9: PAYMENT OPTIONS

Retirees must elect payment through a FRS payroll deduction, checking account, or savings account draft. Personal checks will be accepted only until direct payment can begin (depends upon the time of enrollment or change in enrollment). Certain grace periods may be extended for disabled retirees who are awaiting approval and retroactive retirement benefits.

Florida Retirement System (FRS) Payroll Deduction
The primary method for retiree insurance payment is through FRS payroll deduction. Deductions are paid in advance for the following month’s coverage (e.g., end of May payroll is for June premium).

ACH Bank Account Draft
The alternate method of payment for retirees is a direct deduction from the retiree’s bank account. This method is used for retirees whose insurance deduction(s) exceed the amount of their FRS payroll check or for Investment Plan participants who do not receive a monthly FRS check. Retirees must sign an authorization form. Deductions are made from your bank account on the 3rd of the month for that month’s insurance premium.

Payment Due Dates
Insurance payments are due by the 1st of the month for the following month’s coverage. The District will not send reminders. It will be your responsibility to pay by the due date. The District will allow a 15-day grace period.

Late Payments
With automated deduction of retiree premium, we do not anticipate late payments, however, in the event of a non-payment by the bank or FRS, the District will expect that these insurance payments be made by the 15th of the month they are due. Any subsequent late payments can result in a change in benefit payment method or permanent cancellation of retiree benefits.

Statements of Account
Statements will only be prepared on request.

SECTION 10: Health Insurance Subsidy (HIS) from the Florida Retirement System

The Health Insurance Subsidy (HIS) is additional money added to your monthly retirement benefit to help offset the cost of your health insurance. The HIS is not a health insurance policy. Eligible retirees will receive $5 per month for each year of creditable service used to calculate the retirement benefit. Years of employment in the Deferred Retirement Option Program (DROP) do not count towards your total years of service for the HIS calculation. Effective July 1, 2001 the payment increased to at least $30 but no more than $150 per month.

This subsidy is contingent upon continued approval by the Florida Legislature. The subsidy must be applied for - it is not automatic. FRS will mail the retiree an application after being added on the State’s payroll. It is the retiree’s responsibility to apply in a timely manner to receive the benefit. Please refer to your FRS information for more details.

If the District is providing you with your health insurance and:

• You have signed up for FRS deduction. You may complete the form yourself by checking the first option on the application, sign and mail the form back to the FRS.
• You have signed up for bank account draft. The District must complete the form for you.

The completed HIS application must be returned to the Florida Division of Retirement within six months of the date retirement benefits started in order to receive the subsidy retroactive to the effective date of retirement (or the month following DROP termination if applicable). If the HIS form is not received within six months, retroactive subsidy payments will be limited to a maximum of six months. DROP participants cannot apply for the HIS until they have terminated employment and participation in DROP.

The HIS subsidy is totally separate from the subsidy that the Martin County School District provides, and the retiree may be eligible to receive the HIS benefit even if they do not continue insurance benefits with the District.

How the HIS affects your payment of insurance premiums
It is important for you to understand that the District will begin billing your premium immediately upon your retirement. If the HIS subsidy is greater than the actual monthly premium due, then the health insurance subsidy is the rate due (see example below).

Example 1: A Martin County School District employee retires with 30 years of service on June 9th, so retiree benefits begin July 1st. Based on the 30 years of service, the employee would receive 100% coverage on their medical insurance under the HMO plan. The health insurance subsidy of $150 is greater than the premium due ($0.00), so the District will collect the health insurance subsidy of $150 starting July 1st. When calculating the years of service for employee, the Martin County School District does include the years of employment in the Deferred Retirement Option Program (DROP). Giving service credit to those employees applies to the Martin County School District subsidy towards retiree premium and the HIS.

Example 2: A Martin County School District employee retires with 30 years of service on June 9th. The employee has 25 years of service and 5 years in DROP. Retiree benefits will begin July 1st. Based on the 30 years of service (25 years + 5 years), the employee would receive 100% coverage on their medical insurance under the Open Access Plus In-Network plan. The health insurance subsidy charged by the Martin County School District will be $150. The subsidy of $150 is greater than the premium due ($0.00), so the District will collect the health insurance subsidy of $150 starting July 1st.