Insurance Subsidy Eligibility
When you retire, you and your eligible dependents can enroll in the plan's health, prescription drug, dental, and vision insurance plans. The cost of coverage and conditions of enrollment will vary depending on several factors, which are covered below in detail.
If you enroll in insurances, your share of the premium is deducted from your monthly pension payments. If your pension is less than the premium amount, we will bill you for the remainder of the premium.
If you have the Personal Healthcare Fund, you are not eligible for subsidized health, prescription drug, dental, or vision insurances through the retirement system.
You, your spouse, and your dependents may enroll in insurances if you enroll immediately when you retire but you will be responsible for the entire premium. If you disenroll from the plan at any time, you, your spouse, and your dependents will not be able to re-enroll. If your spouse or dependents are disenrolled at any time, they will not be able to re-enroll.
You cannot initiate a new insurance enrollment as a retiree.
For information about insurance eligibility and enrollment, contact ORS. For other information about your Personal Healthcare Fund, contact Voya Financial® at 800-748 6128.
As an active or deferred member, you may be eligible for a premium subsidy where the retirement system pays a percentage of your monthly insurance premiums (or a percentage of the maximum subsidy for some deferred members). You are responsible for paying the balance of the premium amount. Click here for the most current premium rates.
Did you initiate a service credit purchase on or after July 1, 2008?
Your premium subsidy will be delayed if you initiated a service credit purchase on or after July 1, 2008 that allows you to qualify for your pension earlier than if you did not make the purchase.
If a delayed subsidy applies, your subsidy will begin at age 60 or the age you would have been eligible to retire if you had not made the service credit purchase, whichever happens first. You can still enroll in the health, prescription drug, dental, and vision insurance plans before your subsidy is available; however you will have to pay the entire premium until the subsidy begins.
A delayed premium subsidy does not apply if you become eligible for a pension under a duty or nonduty related death or disability provision.
When did you begin working for a Michigan public school reporting unit?
If you began working for a Michigan public school reporting unit before July 1, 2008, your eligibility for an insurance premium subsidy depends on if you are an active member or deferred member at the time of your retirement. You may be subject to a delayed subsidy if you initiated a service credit purchase on or after July 1, 2008.
For subsidy eligibility, you're considered active if you earned one-tenth (0.1) or more years of service in each of the five school fiscal years immediately before your retirement effective date, or at least one-half (0.5) years of service within the two school fiscal years immediately before your retirement effective date. In either case, you must be employed in the month before your retirement effective date (click here for details on how you earn years of service) unless the summer birthday provision applies or your employer granted you an unpaid leave of absence due to a mental or physical disability supported by your personal physician.
When you retire, you will become eligible for the maximum premium subsidy allowed by law as of your retirement effective date (unless you're subject to a delayed premium subsidy).
You are deferred if you are vested but leave public school employment before you meet the age requirement for retirement, and did not take a refund. As a deferred retiree, the amount of the insurance premium subsidy you qualify for will depend on when you terminated your public school employment and how many years of credited service you have.
- Terminated after October 31, 1980, with at least 21 years of service. With 21 years of credited service, you will get 10 percent of the maximum subsidy (not 10 percent of the premium) allowed by law. For each additional year of service, you will get an additional 10 percent of the subsidy (not the premium). For example, with 21 years of service, you'll get 10 percent of the subsidy, and with 25 years of service, you'll get 50 percent of the subsidy. If you retire with 30 or more years of service, you'll get 100 percent of the subsidy allowed by law. Click here for the current rates.
- Terminated after October 31, 1980, with fewer than 21 years of service. You may enroll for the health, prescription drug, and dental/vision insurance, but you must pay the entire premium.
- Terminated on or before October 31, 1980. You're entitled to 100 percent of the subsidy (not the premium) allowed by law. Click here for the current rates.
Subsidy Eligibility - Membership Begins On or After July 1, 2008, but Before July 1, 2010
If you began working for a Michigan public school reporting unit after July 1, 2008, you are eligible for a graded subsidy based on career length - the longer you work, the greater your premium subsidy is, up to the maximum subsidy allowed by law, currently set at 80 percent. You must have at least 10 years of service to qualify for any subsidy (see Qualifying for Your Pension).
- MIP 46 with 30. If all of your service credit is earned (not purchased), as of your retirement effective date, you will be eligible for the maximum subsidy allowed by law, currently set at 80 percent. If you have earned at least 25 years of service, and have purchased service to reach 30 years of service, you will have a delayed subsidy. If a delayed subsidy applies, your subsidy will begin at age 60 or the age you would have been eligible to retire if you had not made the service credit purchase, whichever happens first.
- MIP 60 with 10. If, as of your retirement effective date, you have between 10 and 23 total years of service, a graded subsidy applies. With 10 years of service, your subsidy will be 30 percent of the premium. The subsidy increases by an additional 4 percent of the premium for each additional year of service, up to the maximum subsidy allowed by law, currently set at 80 percent.
INSURANCE SUBSIDY RATES
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- MIP 60 with 5. The insurance premium subsidy is not available to retirees with fewer than 10 years of service.
- Early Reduced Provision. If you have at least 25 years of earned (not purchased) service as of your retirement effective date, you will qualify for the maximum subsidy allowed by law when you retire. If you have fewer than 25 years of earned service as of your retirement effective date, you will qualify for the graded subsidy when you reach age 60.
Additional notes about the premium subsidy
- Subsidized insurance coverage for a spouse named under the provisions of Public Act 617 of 2006, which allows retirees to name a new spouse as a survivor pension beneficiary under certain conditions, will end upon the death of the retiree. Coverage can continue by paying the full premium. For details, visit our website and navigate to After Retirement, When to Contact ORS, Marriage.
- If you became a member of the Michigan Public School Employees Retirement System between July 1, 2008, and June 30, 2010, and you have the Premium Subsidy benefit, a graded insurance premium subsidy will apply at retirement. Once you meet the MIP age 60 with 10 eligibility requirements, a percentage of your insurance costs is subsidized based on your earned years of service. No insurance premium subsidy is available to employees hired between July 1, 2008, and June 30, 2010, who retire with fewer than 10 years of service.