Health Care 2022 Medicare-Eligible Retirees
Eligibility for OPERS Medicare Coverage
Eligibility requirements will only change for those retiring on or after Jan. 1, 2022. If you’re currently retired and eligible (or retire and are eligible prior to Jan. 1, 2022) to participate in the OPERS health care program, you will continue to be eligible after Jan. 1, 2022. However, you will be impacted by changes to your Health Reimbursement Arrangement (HRA) allowance.
If you are receiving a disability benefit with an effective date of Dec 1, 2021 or prior you are still under the eligibility rules that were in place based as of your benefit effective date.
Health care eligibility requirements will change for new retirees with a benefit effective date on or after Jan. 1, 2022, see the Active Member section for details.
Health Reimbursement Arrangement Allowance
Effective Jan. 1, 2022:
- The base allowance percentages and monthly HRA deposit amount for Medicare-eligible retirees will be reduced from $450 to $350 per month.
- Allowance amounts will range from 51 percent ($178.50 per month) to 90 percent ($315 per month) of the base amount.
Step 1: Determining Your Allowance Percentage
To determine your allowance percentage, compare the table below to the following:
- Your age when you first enrolled in the OPERS Health Care Program
- Your qualifying years of service credit at retirement
Use age 60 if you were, or plan to be, under age 60 at first enrollment; use age 65 if you were, or plan to be, over age 65 at first enrollment. Partial years of service credit are not rounded up to the next year.
Notes for those retired and enrolled prior to 2015:
- If you had less than 20 years of service, your allowance percentage will be reduced from 75% to 51% effective Jan. 1, 2022.
- If you had 20 or more years of service, your allowance could change. This impacts retirees who, using the table, had an allowance percentage less than 75%, but were grandfathered at 75% in 2015. Your allowance will be reduced to between 51% and 74% based on your actual position on the allowance table effective Jan. 1, 2022.
|Health Care Allowance Percentage|
Service / Age
Step 2: Determining Your Monthly HRA Deposit Amount
To determine your monthly HRA deposit amount, compare the table below to the following:
- Your allowance percentage from the table above
($350 base allowance)
OPERS Board of Trustees set plan for re-employed retiree health care
Because all OPERS group medical plans are being eliminated in 2022, the trustees voted to implement new rules for re-employed retirees effective Jan. 1, 2022.
How re-employed retiree coverage works today
Currently, when retirees become re-employed in an OPERS-covered position, their health care coverage changes. OPERS requires all re-employed retirees to choose coverage offered by the employer if it's available to them. If employer coverage isn't available, re-employed retirees may enroll in a separate, OPERS Medicare group plan that is secondary to Medicare. Retirees pay a premium which is offset by the OPERS-provided allowance. For Medicare retirees, the allowance replaces the HRA during the re-employment period. Participants are subject to new deductibles and co-insurance.
There is one difference specific to Medicare re-employed retirees. They can stay enrolled in their Medicare medical plan through Via Benefits with no monthly HRA deposits (vs. enrolling in their employer coverage or enrolling in the OPERS group plan if employer coverage isn't available). No matter which option they choose, federal regulations require their HRAs are frozen, and expenses incurred during re-employment are not eligible for reimbursement; however, expenses incurred outside of re-employment can continue to be reimbursed.
How re-employed retiree coverage will work effective Jan. 1, 2022
All re-employed retirees will be able to retain their private-market plans. For Medicare re-employed retirees, the monthly HRA deposits will continue to accumulate during re-employment (in a separate Re-Employed Accumulated HRA) if the re-employed retiree remains enrolled in their Medicare medical plan through Via Benefits. However, because of federal rules, re-employed retirees will not be able to access the accumulated money while they're re-employed. It will become available once they terminate their re-employment and can be used to seek reimbursement for any expenses incurred outside of re-employment.
Similar to today, re-employed retirees will continue to have access to their HRA balance accrued prior to re-employment during the re-employment period to seek reimbursement for expenses incurred outside of re-employment.
Re-employed retirees can expect more communications regarding this change in 2021.
Attend an education event
We know you have questions, which is why we're offering interactive webinars designed specifically for the Medicare and pre-Medicare populations.
These sessions focus on the health care changes and their impacts as well as health care tips to consider now and during Open Enrollment. Common questions concerning the HRA will also be addressed.
- Webinar: Retiree Health Care 65 and Older
We'll also continue offering small group, hands-on HRA workshops to help you better utilize your HRA.
Check your mail and inbox
Read all communications from OPERS. In the coming months, we will be providing more detail and creating scenarios to show how the changes will affect all segments of our retiree population. We will also be providing more information on education opportunities.
- What is changing for participants in the OPERS Medicare Connector in 2022?
Medicare-eligible retirees will continue to use Via Benefits, as they have since 2016. There are a few notable changes occurring for OPERS Medicare retirees, effective Jan. 1, 2022:
- The base HRA allowance amount is changing from $450 to $350 per month. Monthly HRA deposit amounts will range from 51 percent ($178.50) to 90 percent ($315) of the base allowance amount.
- In addition to a change in the base allowance amount, retirees could see a change in their allowance percentage effective Jan. 1, 2022:
- Retirees who had less than 20 years of qualified health care service credit at retirement will have their allowance percentage reduced from 75 percent to 51 percent.
- If a retiree had 20 or more years of qualified health care service credit at retirement, their allowance percentage could change. This impacts retirees who had an allowance percentage less than 75 percent but were grandfathered at 75 percent in 2015. Their allowance percentage will be reduced to between 51 percent and 74 percent based on their actual position on the allowance table.
- The monthly HRA administration fee will increase from $2.33 to $2.60. The $2.60 monthly HRA administration fee will remain the same from 2022 through 2025.
Why did OPERS decide to lower the base allowance amount for Medicare retirees from $450 to $350 per month?
Offering health care coverage has become increasingly expensive as health care rates have risen dramatically and member demographics have shifted. To preserve the OPERS Health Care Fund for current and future retirees, OPERS took a careful look at all aspects of the health care program to identify impactful changes. Keep in mind that the HRA allowance was never intended to cover the full amount of costs that a Medicare retiree may incur.
On an annual basis, OPERS staff reviews HRA utilization with the Board of Trustees. When considering the value of the Medicare base allowance amount, OPERS staff and the Board discuss the average HRA balance and how much Medicare plans cost. On average, a Medicare retiree carries a balance in their HRA from year to year.
Even though the base allowance amount has been lowered, Medicare retirees should still have sufficient funds within their HRA to cover their supplemental Medicare plan premiums and some will have additional funds for other qualified medical expenses.
- Will Medicare retirees still be required to enroll in a medical plan through the OPERS Medicare Connector to receive HRA deposits?
Yes. Medicare-eligible retirees will continue to participate in a closed HRA. This means they must remain enrolled in a medical plan through Via Benefits to continue receiving monthly HRA deposits.
Allowance Percentage Grandfathering
- Will OPERS continue to reimburse Medicare Part A premiums?
Yes. OPERS will reimburse retirees who don’t qualify for premium-free Medicare Part A for their premium and any penalty at 100 percent. Eligible spouses will continue to receive a 50 percent reimbursement.
- I was grandfathered with a 75 percent allowance in 2015. Will my allowance percentage change effective Jan. 1, 2022? If so, why?
It's likely your allowance percentage will be lower effective Jan. 1, 2022. In 2015, OPERS adopted the allowance table that we use today. This allowance table rewards more years of service with a higher allowance. When OPERS adopted this allowance table, retirees who were already retired and receiving an allowance percentage greater than 75 percent were grandfathered at no less than 75 percent. The 75 percent grandfathering was put in place to help avoid a sudden drop in allowance for those already retired and without the opportunity to work longer to increase their allowance percentage.
However, as health care costs have continued to rise and OPERS has been forced to find ways to preserve the Health Care Fund for current and future retirees, a need for change was identified. Effective Jan. 1, 2022, previously grandfathered retirees will be placed at the location on the allowance table that corresponds with the age when they first enrolled in the OPERS health care program and their years of qualifying health care service credit at retirement (between 74 and 51 percent of the base allowance amount). The lowest possible allowance percentage is 51 percent. Any retiree who had less than 20 years of service will receive a 51% allowance percentage effective Jan. 1, 2022.
- Will anything change for re-employed retirees in 2022?
Yes. All re-employed retirees will be able to retain their individual or family medical plans (or their Medicare medical plan through Via Benefits if applicable) during re-employment. The monthly HRA deposits will continue to accumulate during re-employment in a separate Re-employed Accumulated HRA, if the retiree stays opted into the HRA (or enrolled in their Medicare medical plan through Via Benefits). Retirees can track the balance through their OPERS online accounts.
However, re-employed retirees will not be able to access the accumulated money while they’re re-employed. It will become available once they terminate their re-employment and can be used to seek reimbursement for any expenses incurred outside of re-employment.
Like today, re-employed retirees will continue to have access to their HRA balance during re-employment to seek reimbursement for expenses incurred outside of re-employment.
- How will the changes to the OPERS health care program impact OPERS disability recipients?
Disability benefit recipients with an effective date after Jan. 1, 2014 are eligible to participate in the OPERS health care program during the first five years of disability regardless of service credit and age. Following the first five years, the recipient must meet health care eligibility requirements or be eligible for early Medicare to continue to be eligible. Disability recipients converting to a service retirement must meet health care eligibility requirements to continue to be eligible.
Retirees receiving a disability benefit with an effective date of Dec 1, 2021 or prior are subject to the health care eligibility rules that were in place as of their benefit effective date following the first five years of their disability. Retirees receiving a disability benefit with an effective date on or after Jan. 1, 2022 are subject to the new health care eligibility requirements following the first five years of their disability.