1. Health Benefits After Retirement
Information in this presentation is based on current law and is subject to change.

2. for retiree participation in the State’s Health Benefits Program
Eligibility
for retiree participation in the
State’s Health Benefits Program

3. 16 or 25 are the Magic Numbers!

4. If your Hire Date is prior to 7/1/2011 and your retirement directly follows your State service, you will be eligible for health benefits if:
you have at least 5 years of creditable service; OR
you are approved for a State disability retirement.

5. If your Hire Date is prior to 7/1/2011 and your retirement does not directly follow your State service, you will be eligible for health benefits if:
you ended State service with at least 16 years of creditable service; OR
you ended State service with at least 10 years of creditable service AND within five years of normal retirement age;
you are approved for a State disability retirement.

6. If your Hire Date is after 7/1/2011 and your retirement directly follows your State service, you will be eligible for health benefits if:
you have at least 10 years of creditable service; OR
you are approved for a State disability retirement.

7. If your Hire Date is after 7/1/2011 and your retirement does not directly follow your State service, you will be eligible for health benefits if:
you ended State service with at least 25 years of creditable service; OR
you ended State service with at least 10 years of creditable service AND within five years of normal retirement age;
you are approved for a State disability retirement.

8. State Subsidy for retirees eligible to participate in
the State’s Health Benefits Program

9. You will get the Maximum $tate $ubsidy if:
you have at least 16 years of creditable service if you were hired prior to 7/1/2011 or 25 years of creditable service if were hired after 7/1/2011 OR
you are approved for a State disability retirement

10. Your $tate $ubsidy will be Pro-Rated if: (Based on months of Creditable Service)
you have a service retirement with less than 16 years of creditable service if you were hired prior to 7/1/2011 or less than 25 years of creditable service if you were hired after 7/1/2011

11. Calculating Pro-Rated State Subsidy To find the percentage of maximum subsidy the State will pay, divide your months of creditable service* by 192 months (16 years) if hired prior to 7/1/2011 or 300 months (25 years) if hired after 7/1/2011
For example, 60 months (Five years) ÷ 192 months (16 years) = .3125
▫ (31.25%) of the maximum subsidy;
Retiree’s monthly cost:
▫ (68.75%) of the maximum subsidy, PLUS
▫ the regular monthly retiree premium
*Creditable service includes military and purchased service, and credit for unused sick leave.

12. For estimates of premiums with pro-rated State subsidy, call the Employee Benefits Division:
(410) OR
1 (800) 30-STATE

13. Do Not be Alarmed. Your employee coverage will be terminated
Do Not be Alarmed! Your employee coverage will be terminated. (you won’t have premium deductions through Central Payroll) AND A COBRA letter will be mailed to your home. (even if you’re eligible for retiree coverage…required by federal law)
To have health benefits upon retirement, a Retiree Health Benefits Enrollment Form must be submitted to the Employee Benefits Division
Before completing the Enrollment Form,
please review the current Benefits Guide

14. How to Enroll in Retiree Health Benefits
Obtain a Benefits Guide and
Retiree Health Benefits Enrollment Form from:
▪ Your Agency Benefits Coordinator (in your agency’s HR office); OR
▪ Department of Budget & Management Website ( click on Health Benefits for State Employees);
▪ By contacting the Employee Benefits Division

15. When You Can Enroll, Change, or Cancel Coverage:
During Open Enrollment:
Open Enrollment packets are mailed to your
address on file with Employee Benefits; or
Within 60 days of a Qualifying Event:
Change in Family Status: marriage, divorce, birth
or death of dependent, child no longer eligible
Loss of Other Coverage: includes loss of employee coverage upon retirement
Moving Out of a Plan’s Service Area:
(CareFirst BCBS-POS or
United Concordia-DHMO)
Becoming eligible for Medicare: reaching age 65 or
Social Security disability at any age

16. Completing the Retiree Enrollment Form
The Form must be completed, signed, and dated;
If you will be covering dependents not covered at the time of retirement, you must include the appropriate Dependent Verification Documentation (listed in the Benefits Guide);
The Enrollment Form (and any required documentation) must be received in the Employee Benefits Division with a postmark or fax date within 60 days of your retirement date. Otherwise, you will have to wait to enroll at a later date.

17. Eligible Dependents
Dependent eligibility criteria for retirees is the same as for active employees.

18. Overview
On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act (PPACA) into law which applies to biological children, step-children and adopted children.

19. Dependent Child Eligibility
Children who are dependents and meet
the Program’s Dependent Child criteria
can remain on the policy through the end
of the month they reach age 26 for medical,
prescription drug and dental benefits.
Disabled children are eligible dependents if they have a permanent disability that began before reaching age 26; however:
the child must be a dependent and, other than age, meet dependent child eligibility criteria
a disability certification must be submitted to the Medical Plan (or to the Employee Benefits Division if not enrolled in a Medical Plan) every two years.

20. Young Adult Coverage
NOTE: PPACA provision does not apply to grandchildren and legal wards
Grandchildren and legal wards who are 25 years of age now are subject to post-tax deductions and imputed income (rate tables are located at website, click on Health Benefits for State Employees)

21. Same Sex Domestic Partners are Eligible Dependents
However, you may be taxed on the Imputed Income
Under the Federal Internal Revenue Code:
Domestic Partners are not automatically eligible for tax-preferred health benefits coverage.
If a Domestic Partner and/or the Domestic Partner’s children do not meet the IRS dependency qualifications for tax-preferred coverage, the State subsidy for the partner and/or partner’s children is considered as taxable income for the retiree. This is known as imputed income.

22. Plans Available to Retirees
Medical Plans
PPO: CareFirst, UnitedHealthcare
POS: Aetna, CareFirst, UnitedHealthcare
EPO: Aetna, CareFirst, UnitedHealthcare
Prescription Plan: Express Scripts, Inc.
Dental Plans: United Concordia DPPO or DHMO
Term Life Insurance – If enrolled at the time of retirement, you can continue or decrease coverage; you may not increase or add coverage upon or after retirement
Long Term Care – Complete a conversion form within 90 days of your last day of employment to continue same coverage; payments are made directly to The Prudential Insurance Company of America

23. Term Life Insurance
Both the Retiree and the Dependent life insurance policies are reduced, based on the retiree’s birth date as follows:
65% of original coverage the month retiree reaches age 65
45% of original coverage the month retiree reaches age 70
30% of original coverage the month retiree reaches age 75
20% of original coverage the month retiree reaches age 80
Premium is based on new age bracket and policy amount
Up to the full “lost” amount of coverage can be converted to an individual whole life policy by contacting MetLife within 31 days of the reduction.

24. Plans Not Available to Retirees
Flexible Spending Accounts (Health Care and Dependent Care)
According to federal regulations, the plan will only reimburse eligible expenses incurred while still an active employee
Accidental Death & Dismemberment Plan
You can convert to a private policy with the AD&D carrier within 30 days of ending employment
Term Life Insurance
If not enrolled with no break between employee and retiree coverage

25. If You Change Your Address
Submit your address change in writing to the
Employee Benefits Division with a
Personal Information Change Form; or
Letter with your name, old address, new address,
phone number, signature and date.
*Under the current contract, if you elected
CareFirst BCBS-POS (out of network benefit only
outside the Maryland Service Area) or the United
Concordia DHMO plan and move outside of
Maryland Service Area, you must elect another
plan as this plan is not available nationwide.
Also notify the State Retirement Agency.

26. Plans with a National Provider Network
Medical Plans:
Aetna POS and EPO
CareFirst PPO, POS* and EPO
UnitedHealthcare PPO, POS and EPO
Prescription Plan: Express Scripts, Inc.
Dental Plan: United Concordia DPPO
(also has Out-of-Network coverage)
*CareFirstBCBS-POS plan has In-Network providers in the Maryland Service Area only

27. Retiree Group Coverage is Secondary to Medicare
Whether or not you are working, if the cost for your State medical benefits is deducted from a Maryland State Agency pension, you are in a Retiree Group. If you are in a Retiree Group and are eligible for Medicare by way of:
●Age (at age 65) OR ●Disability (at any age):
Medicare is your primary insurer; the State plan is secondary to Medicare. Both Parts A (hospital) & B (medical) are required for coverage. Without Part B, you will be responsible for 80% of claim costs that Part B would have covered.
If you receive a Social Security income, Social Security should mail your Medicare card to you about three months before your Medicare eligibility date.
If you are not receiving a Social Security income, you should contact Social Security to enroll in Parts A and B the month prior to eligibility.
You are responsible for notifying the Employee Benefits Division of Medicare eligibility due to a Disability or End Stage Renal Disease (ESRD) at any age.

28. Medicare Initial Enrollment Period (7 months)
Month You Enroll
Month Part B Coverage Begins
1st month
1st day of month you reach age 65
2nd month
3rd month
4th (birthday) month
1st day of following month (1-month delay)
5th month
Two-month delay
6th month
Three-month delay
7th month
Exception:
If you were born on the 1st day of the month:
Seven-month IEP begins and ends one month earlier;
Eligible for Medicare month before reaching age 65.

29. If you or your spouse are eligible for Medicare when retiree-group coverage begins: (Not Applicable to Domestic Partners)
You will have a Special Enrollment Period (SEP) for Part B, if you:
move from an active employee-group to a retiree-group coverage, and
do not turn age 65 within six months (before or after) the month employee-group coverage ends.
A Special Enrollment Period is offered when you move from an active employee group coverage to a retiree group coverage, and the penalty for delayed enrollment in Part B is waived. Exception: If employee group coverage ends during your Initial Enrollment Period, Special Enrollment Period rules do not apply. Contact Social Security in the first three months of your Initial Enrollment Period (the three months prior to reaching age 65) to find out how to make your Part B coverage begin when you retire.
NOTE: According to federal regulations, Special Enrollment Period rules do not apply to Domestic Partners.

30. Month Part B Coverage Begins
Medicare General Enrollment Period (3 months from January 1st through March 31st each year)
Month You Enroll
Month Part B Coverage Begins
January 1st-31st
July 1st
of the same year
February 1st-28th
March 1st-31st
If you were eligible but not enrolled in Medicare and you did not have health benefits coverage under an active employee’s policy, your Part B premium will be penalized 10% for every 12 months you were entitled to Part B but not enrolled.

31. Doctor Visit Co-pay (with doctors that participate with Medicare)
If you have:
Medicare Parts A & B as your primary insurer,
and
State Retiree Group coverage as your secondary insurer:
Medicare will pay the Medicare-allowed amount and the State plan will pay the balance; therefore, you will not have a co-pay.

32. You do not have to enroll in Medicare Part D (Prescription Drug)
You may:
Keep the State of Maryland prescription plan
and not enroll in Medicare Part D;
Enroll in Medicare Part D (Enroll 10/15-12/7 each year) and cancel your State of Maryland prescription plan; OR
You may also enroll in both Medicare Part D (Enroll 10/15-12/7 each year) and the State’s prescription drug plan; however, you will be paying premiums for both plans and the is no coordination of benefits between the plans.

33. Which prescription plan is best for me?
For most people, the State of Maryland prescription plan is the best value, but you must decide which plan is best for you by considering premiums, deductibles, co-pays, coverage gaps, and maximum out-of-pocket costs for each plan.
The State of Maryland prescription coverage is Creditable Coverage (as good as or better than Standard Medicare Part D).
If you keep the State prescription plan, you can still enroll in Medicare Part D at a later date without incurring a Part D penalty (as long as you do not have a break in coverage of 63 days or more).

34. Retirement Options and Spouse Beneficiaries*
Allow a surviving spouse (if designated as retirement beneficiary) to continue coverage with same State subsidy as the retiree
Options 0,1 and 4
Surviving spouse is not eligible for continued subsidized health benefits
Health benefits will be available under COBRA for up to 36 months with no State subsidy and 2% administrative fee
* includes same sex spouses

35. Retirement Options and Domestic Partner Beneficiaries
Regardless of the Retirement Option selected, Domestic Partner Beneficiaries are not eligible for subsidized group health benefits upon the retiree’s death
Parallel COBRA coverage will be available for up to 36 months with no State subsidy and a 2% administrative fee

36. Retirement Options and Child Beneficiaries
A Child Beneficiary who continues to receive a monthly retirement benefit is not eligible for subsidized health benefits unless he/she would meet the criteria for Dependent Child coverage if the retiree were still living
If the Beneficiary meets the Dependent Child criteria, eligibility for subsidized coverage will end if/when the child no longer meets the criteria. The Dependent Child is eligible to receive health benefits through the end of the month the Dependent Child reaches age 26 based on the current contract.

37. After you retire, you may receive:
A “No Pay” letter from the Employee Benefits Division
A “Non Group Bill” from your health plan (a conversion bill on health plan letterhead)
DON’T WORRY!!!
These forms may have been printed automatically due to the cross-over of paperwork.
If deductions don’t occur on your first retirement check, coverage can be made retroactive to your date of retirement. You will receive a letter from our office indicating the amount you must pay for continuous coverage.

38. Website www. dbm. maryland
Website click on Health Benefits for State Employees
Phone or
Toll Free
STATE ( )