Policy/Memo 93r1

Number: Policy Memo 93r1
Date Issued: January 9, 2003
Policy File Ref: A1130
Subject: Retirement Eligibility

ISSUE:

Determine if an enrollee eligible for a retirement incentive who had previously declined or cancelled NYSHIP coverage may reinstate or enroll for coverage without a waiting period in order to have health insurance as a retiree.

Background:

Employees often cancel or decline NYSHIP coverage because they have other coverage. In order to encourage such behavior, NYSHIP policy allows such persons back into NYSHIP without a late enrollment waiting period if they lose coverage under the other plan. If there is no loss of coverage under the other plan, the late enrollment waiting period applies to save the State premium contribution and diminish the effect of adverse selection. Usually, this permits the State to maximize the benefits accruing to us from an enrollee's voluntary declination of coverage, and there is no harm to the enrollee. In the event of retirement incentive programs, however, the enrollee who is eligible for the retirement incentive frequently is not able to select an effective date of retirement that is far enough in the future to accommodate the late enrollment waiting period, thus rendering the enrollee ineligible for health insurance in retirement under the incentive.

Policy:

Waive the late enrollment waiting period for persons eligible to retire during a retirement incentive program who wish to enroll or to change from individual to family coverage. In such cases, the effective date of coverage will be the retirement date. Participating Agencies and Participating Employers may adopt this policy on an optional basis.