Continuation Options
Employees who are retiring or separating from the District will receive a letter from PayFlex Systems USA, Inc. (third-party administrator) within 14 days of the date of loss of coverage. The letter will include their benefit options, instructions, and any applicable forms. This letter also serves as confirmation of termination of benefits.
Non-Medicare Eligible Persons
Retirement
Important Information regarding Premium Tax Credit (Subsidy Assistance): If you qualify for a Premium Tax Credit under the Affordable Care Act (ACA), you must suspend your HRA account to receive the credit. You will not be able to submit or incur expenses for reimbursement during the time your HRA is suspended; however, OUSD will still contribute to your account during the suspension period and the account will continue to earn interest. The suspension must remain in effect through the end of each year that you are receiving a Premium Tax Credit.
MidAmerica Health Reimbursement Arrangement (HRA)
Retiring employees who meet the following requirements, may elect to receive $500/month through a Health Reimbursement Arrangement (HRA) account administered through MidAmerica:
Must retire from CalPERS or CalSTRS
Must be enrolled in a District-sponsored medical plan at time of retirement
Cannot continue enrollment in any District-sponsored health insurance plan after retirement
Cannot be eligible for Medicare
AND
Must be age 55 or older with 20+ cumulative years of regular service to the District OR
Must be age 60 or older with 10+ cumulative years of regular service to the District
This $500 per month Health Reimbursement Arrangement (HRA) account managed through MidAmerica will be effective the first of the month following your date of loss of District-sponsored insurance coverage. To establish the account and initiate the funding process, you must also provide proof of retirement from CalPERS or CalSTRS no later than 60 days from the date of loss of District-sponsored insurance coverage. If proof of retirement is not received within the 60-day period, then your account will be funded beginning the first of the month following the date of receipt of the proof of retirement. There will be no retro-active contributions for accounts that are not verified within the 60-day period.
You cannot continue enrollment in any OUSD-sponsored health insurance plan after retirement; therefore, you must waive your COBRA continuation.
The HRA account will be available to use for eligible expenses (including but not limited to: insurance premiums, copays, durable medical equipment, and prescriptions) beginning the first of the month that the employee is no longer covered on District-sponsored healthcare plan(s).
The $500 contributions will be made on a quarterly basis into the account until the retiree attains age 65 or upon enrollment in Medicare, whichever comes first.
Additionally, a specialized KeenanDirect agent will contact the retiree to provide one-on-one assistance to help review, compare, select, and enroll in a plan through the healthcare exchange, Covered California. Retirees living outside of California can find coverage options through the Federal Exchange.
Employment Termination & Unpaid Leaves of Absence
COBRA Coverage Continuation
Retiring employees who do not qualify to receive the MidAmerica HRA (see section above) will have the option to continue their coverage under COBRA for up to 18 months for themselves or 36 months for their eligible dependents. Premiums plus a 2% administrative fee will be at the retiree's expense.
Medical coverage will terminate the first of the month of which the retiree attains age 65, upon enrollment in Medicare, or at the end of the 18 months (36 months for dependents), whichever comes first. All other coverage ends the last day of the month in which a member cancels their coverage or at the end of the 18 months (36 months for dependents). Cancellations must be submitted online through Benefitfocus. Once coverage is terminated, the member / retiree may not re-enroll in the future.
However, if the retiring employee qualifies for the MidAmerica HRA account but elects to continue coverage under COBRA, then they will forfeit the right to receive the MidAmerica HRA per Section 9.4 of the OTA Master Contract (07/01/20 - 06/30/21) and Section 8.4 of the CSEA Master Contract (07/01/20 - 06/30/22).
Additionally, there are alternative individual health insurance options available to purchase for COBRA beneficiaries and retirees without Medicare through the Health Insurance Marketplace, Covered California.
Retirees (On or Before 06/30/18)
Employees who retired on or before June 30, 2018 qualified to continue their current enrollment(s) in medical, dental, and/or vision coverage. Medical coverage will terminate the first of the month of which the retiree attains age 65 or upon enrollment in Medicare. All other coverage ends the last day of the month in which a member cancels their coverage. Cancellations must be submitted through PayFlex Systems USA, Inc. (beginning 08/01/2021). Once coverage is terminated, the subscriber may not re-enroll in the future.
COBRA Coverage Continuation
Employees who go on an unpaid leave of absence or terminate employment with the District will be offered COBRA continuation coverage for up to 18 months (up to 36 months for their dependents).
The insurance premiums, plus a 2% administrative fee, would be at the individual's expense. As of 08/01/2021, COBRA benefits are administered by PayFlex Systems USA, Inc.
Medical coverage will terminate the first of the month of which the member attains age 65, upon enrollment in Medicare, or at the end of the 18 months (36 months for dependents), whichever comes first. All other coverage ends the last day of the month in which a member cancels their coverage or at the end of the 18 months (36 months for dependents). Cancellations must be submitted through PayFlex Systems USA, Inc. Once coverage is terminated, the member may not re-enroll in the future.
In lieu of COBRA continuation, COBRA beneficiaries may choose an alternative individual health insurance option (available to purchase) through the Health Insurance Marketplace.
VEBA - LIG Solutions + VEBA COBRA Alternatives.pdfMedicare Eligible Persons
Medicare Part A & B Enrollment
If an employee retires and qualifies for Medicare (typically at age 65; please visit the Medicare website to other eligibility factors), then they will need to enroll in Medicare Parts A & B, effective the first of the month that they are no longer covered on a District-sponsored medical plan. (See Social Security Administration site below regarding the Special Enrollment Period.)
VEBA - LIG Solutions + VEBA Medicare Options.pdfSupplement (MediGap) & Advantage Enrollment
Enrollment Assistance
If you and / or your covered spouse / domestic partner qualify for Medicare (typically age 65 persons), you will receive a letter from KeenanDirect within two to three weeks with information on how to enroll in a Medicare supplement plan. A specialized KeenanDirect agent will contact you to provide one-on-one assistance to help review, compare, select, and enroll in a plan.
If you were enrolled in one of the District-sponsored medical plans, you will also have the opportunity to enroll in a Kaiser or UnitedHealthcare Medicare plan offered through the California Schools VEBA Post-65 Group Retirement Plans. If you would like to enroll in a CA Schools VEBA Post-65 Group Retirement plan, please contact Paula Lancaster by phone at (619) 961-2047 or by email at plancaster@mcgregorinc.com.
Supplement / Advantage Plan Options
Planning to Retire?
If you are planning to retire, we ask that you first attend an Insurance After Retirement 101 class, which includes a Q&A section, or view one of our recorded webinars.
Recommended for all benefit-eligible employees planning to retire.
Recommended for all benefit-eligible employees planning to retire.
