Most of us know the basics about what is required to continue our current insurance coverage into retirement but there are many fine points that some employees don’t find out until they begin the retirement process and it can drastically affect their decision to retire when they planned to; or they may find they do not have the level of insurance benefits they counted on. While not every aspect of eligibility for this purpose can be included in one article, an effort must be made to outline a few of the more “little known” facts. What you don’t know, CAN hurt you.
Eligible employees must have at least ten years of creditable service to continue insurance coverage. Since many state or higher education employees also have service with other state agencies that participate in TCRS, it is important to know what service can be combined and counted toward the minimum of ten (10) years of service; as well as what counts toward total service for the insurance premium reduction at retirement. Eligible service for this purpose includes:
- Accumulated unused sick leave may be counted.
- Employment with the State of Tennessee, a state higher education institution, or a participating local education agency to calculate total employment. (Only creditable service with the State of Tennessee, local education institution or a local education agency that participates in the state group health plan will count).
Accumulated unused sick leave may be counted. However, what will not count for insurance continuation purposes is:
- Military service that did not interrupt employment
- Service that was previously cashed out/withdrawn from TCRS previous and not paid back
- Educational leave
- Leave of absence, or
- Service with a local government agency cannot be counted.
An employee may include:
- Years of service with the state, higher education, or local education employers participating in the plan applies to the length of service requirement for continuing coverage at retirement, not necessarily toward premium reduction. Premiums may be calculated to include service with state, higher education and local education employers participating in TCRS. For retirees combining service, on local education service, state premium support is provided on teaching service only.
If you are eligible to combine creditable state service with creditable local education service, you will be classified as a retiree under the plan from which you terminated employment immediately preceding your retirement. For example, if you worked for a participating local education agency for 10 years, then worked for a state agency for 10 years and retire, you will be considered a state retiree with 20 years of service for insurance purposes. State and higher education employees must meet the following service eligibility requirements in order to continue their insurance:
- Ten years of creditable service with the state and at least three years of continuous insurance coverage in the plan immediately prior to final termination of employment.
- The date retirement pension benefits commence (effective date of retirement with TCRS) must be on or before the date on which your active state coverage ceased.
Note: the requirement for immediate commencement of retirement benefits will be waived for employees leaving the plan and becoming insured by a State, Local Education or Local Government agency that participates in the State Group Insurance Program.
- At least 20 or more years of creditable service with the state and at least one continuous year of insurance coverage in the plan immediately prior to final termination of employment.
- The period of time between your final employment termination date and the date retirement pension benefits commence (effective date of retirement with TCRS) may be up to five years.
Note: the five-year requirement for commencement of retirement benefits will be waived for employees leaving the State Plan and becoming insured by a State, Local Education or Local Government agency that participates in the State Group Insurance Program.)
