It is the beginning of a new year, and some TSEA members will be or are considering retiring in 2021. Most state employees, including higher education employees, know the basics about what is required to continue their current insurance coverage into retirement. However, there are many fine points that some employees aren’t aware of until they begin the retirement process, which would impact their decision to retire when they planned to; or they may find that not all of their service time counts toward insurance benefit upon retirement. While not every aspect of eligibility for this purpose can be included in one article, an effort should be made to outline a few of the more “little known” facts. Take the time now to be prepared for retirement.
Eligible employees must have a minimum of 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. The service time impacts the monthly premium amount for employees.
Eligible service for this purpose includes
• Accumulated unused sick leave may be counted. Every 20 days of unused sick leave adds another month to your creditable service.
• Employment with the State of Tennessee, a state higher education institution, or a participating local education agency. 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.
• 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. Premiums will be calculated to include service with state, higher education, and local education employers participating in TCRS. For retirees combining service, or local education service, state premium support is provided on teaching service only.
Examples of service time which is not included
• 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• Service that was previously cashed out/withdrawn from TCRS previous and not paid back • Educational leave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 without pay, or
• Service with a local government agency
• Any agency which did not pay into TCRS for the employee, contract agencies
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 ten years, then worked for a state agency for ten years and retire, you will be considered a state retiree with 20 years of service for insurance purposes.
• Ten years of creditable service with the state and at least three years of continuous insurance coverage in the plan immediately before final termination of employment.
• The date retirement pension commences (the 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.
• The period between your final employment termination date and the date retirement pension benefits commence (the 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 Edu cation or Local Government agency that participates in the State Group Insurance Program.)
A year or so before actually retiring, take some time and visit the website below. Here you will be able to set up a self-service account through TCRS. This will be helpful for you to determine if all the service time is correct. Employees retiring will need to submit their application to retire through their self-service account, including the application to continue insurance. There is also helpful information available to you once you have set up your personal account with TCRS.
Remember, a benefit you have as a member of TSEA is retirement counseling with staff in the Compensation and Benefits division. Staff is knowledgeable and will help you as you transition from active employee to retired status. Please give us a call.