State Teachers Retirement System of Ohio

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eUPDATES for Employers

Health Insurance Rules Clarified for Reemployed Retirees

May 6, 2013

STRS Ohio has received multiple questions from employers about health insurance rules for reemployed retirees. While employment contracts and collective bargaining agreements are unique, the rules for determining whether STRS Ohio provides primary or secondary health insurance for reemployed retirees are defined by the Administrative Code Rules. These rules remain unchanged since becoming effective in January 2009.

Coverage under the STRS Ohio Health Care Program is limited for reemployed, non-Medicare retirees in public or private positions. Under Administrative Code Rule 3307:1-11-02, reemployed retirees are eligible for only secondary health care coverage from STRS Ohio if they:

  • Are eligible for health insurance through their employer; or
  • Hold a position for which other comparable employees are eligible for health insurance at the same cost as full-time employees. Note: The determination of comparable employee is based on position and employment status (part time/full time), not retirement status.

The rule applies to all reemployed retirees who are not eligible for Medicare, regardless of hire date or type of employment. Also, the rule applies only when the employer insurance plan provides both medical and prescription drug coverage.

If eligibility or cost for employer insurance is based on retirement status, the retiree is not eligible for primary coverage from STRS Ohio.

In simple terms:

  1. Reemployed retirees, who are restricted from access to their employer plan due to being retirees, are not eligible for primary coverage from STRS Ohio. (See scenario 1.)
  2. If reemployed retirees are required to pay more for coverage under the employer’s plan due to being reemployed, the retirees are eligible for only secondary coverage from STRS Ohio. Primary coverage would need to be obtained from the employer or another plan. (See scenario 2.)
  3. Reemployed retirees who are in positions for which other comparable employees pay a higher premium than full-time employees are eligible for primary coverage from STRS Ohio. Keep in mind, the determination of comparable employee is not based on retirement status. (See scenario 3.)

The following hypothetical scenarios are intended to help you understand how eligibility for STRS Ohio health care coverage is determined. While these examples use teacher and administrator positions, the same results would apply for any STRS Ohio retiree who is reemployed.

Scenario 1

STRS Ohio retiree Joe Brown is employed as a full-time teacher and is excluded by the collective bargaining agreement from the employer-provided health plan. The agreement between the board and the union provides that all full-time teachers are entitled to health insurance. However, the agreement between the board and the teachers union provides that a retiree is not eligible for employer-provided insurance.

Eligibility: Joe Brown would not be eligible for primary coverage through STRS Ohio since employees in other comparable positions (full-time teachers) are eligible for health care coverage through the employer. The collective bargaining agreement’s treatment of reemployed teachers is irrelevant since the comparison is to other employees in comparable positions.

Scenario 2

STRS Ohio retiree Jane Smith is employed as a full-time administrator and is eligible for the same health insurance as other administrators. However, the STRS Ohio retiree must pay a higher percentage of the health insurance premium than full-time administrators who are not retirees. The collective bargaining agreement provides that full-time administrators pay 20% of the premium, whereas full-time administrators who are retirees pay 60%.

Eligibility: Jane Smith would be eligible for only secondary coverage through STRS Ohio since employees in other comparable positions (full-time administrators) are eligible for health insurance through the employer. The collective bargaining agreement's treatment of reemployed administrators is irrelevant, since the comparison is to other employees in comparable positions.

Scenario 3

STRS Ohio retiree Betty Lee is employed as a part-time teacher. Under a collective bargaining agreement provision applicable only to reemployed retirees, she is not eligible for the same health insurance as other part-time teachers. Part-time teachers pay 60% of the premium as compared to full-time teachers who pay 20%. The agreement between the board and the teachers union provides that a retiree is not eligible for employer-provided health insurance, but must take health insurance provided by STRS Ohio.

Eligibility: Betty Lee would be eligible for primary coverage from STRS Ohio. The reemployed retiree is in a position for which other comparable employees (part-time teachers) are not eligible for coverage at the cost available to full-time employees. It is irrelevant how the collective bargaining agreement treats the reemployed retiree. The relevant fact is Betty Lee is employed as a part-time teacher and other part-time teachers (regardless of retirement status) are not eligible for health insurance at the cost available to full-time employees.

If you have questions or would like to discuss a specific matter, please call your STRS Ohio employer education coordinator toll-free at 888‑535‑4050 or send an email to [email protected].

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