If you are eligible for retirement and thinking of retiring before 2021 due to the change in retiree health care contributions, carefully weigh any financial trade-offs involved. Understanding these changes will help you make the best decision about when to retire and how to budget for health care. 

You can compare the following 2021 retiree health plan rates to the 2021 rates for current retirees who retired between January 1, 2019 and December 31, 2020 to help you make your decision. 

Service Date Before January 1, 2013

If your service date is before January 1, 2013, you are 62 or over, and you retire on or after January 1, 2021, the university contribution for retiree health benefits will be based on years of service at retirement, in addition to the requirement of 80 points to be eligible to retire.

View your 2021 health plan rates based on years of service:

• At least 10 but less than 12 years of eligible service: 40% university contribution (25% for dependents), use Chart I

• At least 12 but less than 14 years of eligible service: 48% university contribution (30% for dependents) use Chart J

• At least 14 but less than 16 years of eligible service: 56% university contribution (35% for dependents), use Chart K

• At least 16 but less than 18 years of eligible service: 64% university contribution (40% for dependents), use Chart L

• At least 18 but less than 20 years of eligible service: 72% university contribution (45% for dependents), use Chart M

• 20 or more years of eligible service: 80% university contribution (50% for dependents), use Chart N 

If you retire under age 62 you will pay the full cost of benefits through the month you turn 62 in addition to the above schedule. Refer to Chart B.

Service Date On or After January 1, 2013

If your service date is on or after January 1, 2013, and you retire on or after January 1, 2021, the university contribution for retiree health benefits will be based on years of service at retirement as follows, in addition to the requirement of 80 points to be eligible to retire.

• At least 10 but less than 12 years of eligible service: 34% university contribution (13% for dependents)

• At least 12 but less than 14 years of eligible service: 40.8% university contribution (15.6% for dependents)

• At least 14 but less than 16 years of eligible service: 47.6% university contribution (18.2% for dependents)

• At least 16 but less than 18 years of eligible service: 54.4% university contribution (20.8% for dependents)

• At least 18 but less than 20 years of eligible service: 61.2% university contribution (20.8% for dependents)

• 20 or more years of eligible service: 68% university contribution (26% for dependents)

If you retire under age 62 you will pay the full cost of benefits through the month you turn 62 in addition to the above schedule.

View the university contribution toward retiree health benefits for retirement on or after January 1, 2021 with a service date on or after January 1, 2013.

Examples: University Contribution Based on Years of Service

John is age 60 and is hired on March 1, 2013 as an accountant working full time. John retires with benefits on March 1, 2023 since he accumulated the necessary 80 points (he will be age 70 and have 10 years of service) assuming he always worked full time in an eligible job title. The university contribution toward John’s retiree health care will be 34%. John would need to work until March 1, 2033 in order to accumulate the necessary 20 years of service for the university to contribute the maximum university contribution of 68%.

Pam was hired on October 1, 2015 at age 40 as an administrative assistant working full time. Pam retires with benefits on October 1, 2035 since she accumulated the necessary 80 points (she will be age 60 and have 20 years of service) assuming she always worked full time in an eligible job title. Pam will need to pay for all benefit premiums until age 62. Once Pam reaches age 62 as a retiree, the university contribution toward her retiree health care will be 68%.