Plan Sponsors Announce New Post-Retirement Insured Benefits Programs

posting date Posted: November 17, 2016
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On November 16, 2016 the Government of Ontario and OPSEU announced a Memorandum of Settlement (MOS) regarding post-retirement benefits for members of the OPSEU Pension Plan. These benefits are provided by the Government of Ontario through its carrier Great-West Life. The following details about these changes are based on the most recent information provided by the Government of Ontario (the province).

Eligibility requirements will change effective January 1, 2017.  Currently, eligibility for coverage is based on 10 years of pension service.  For most members the new eligibility criteria will require 20 years of pension service instead of 10 and retirement to an immediate unreduced pension.

Members of the OPSEU Pension Plan who meet the eligibility requirements for post-retirement insured benefits and who begin receiving their pensions before January 1, 2017 will be covered under the existing benefits program.  The province will continue to pay 100% of the insurance premiums.

Members hired before January 1, 2017 who begin receiving their pensions on or after January 1, 2017 and who have at least 10 years of pension service prior to January 1, 2017, or who have at least 20 years of pension service and retire to an immediate unreduced pension, will have a choice of one of two plans:

  1. Plan A will provide the same benefit coverage as members who begin receiving their pensions before January 1, 2017. However, the member will pay 50% of the premiums in retirement.
  2. Plan B will provide a different schedule of benefits (priced by the province at 50% of Plan A in 2016) and the province will pay 100% of the premiums.  This is the default option for eligible retiring members who do not elect to enroll in Plan A.

Any member hired on or after January 1, 2017 who meets the new 2017 eligibility requirements will be eligible for benefit coverage under Plan B only and will have to pay 100% of the premiums.

A member who has elected Plan A may make an election in December of any year to switch to Plan B on January 1 of the following year.

A member who has elected Plan B may make an election in December of any year to switch to Plan A on January 1 of the following year.  However, if the member subsequently switches back to Plan B, he or she will not be eligible to participate in Plan A again.

Decisions regarding the selection of Plan A or B can be made by eligible members at the time of retirement.

 

 

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