SB 466 continues to generate the most questions among our members. This week MOSERS received a copy of the Senate Committee Substitute for Senate Bill

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SB 466 continues to generate the most questions among our members. This week MOSERS received a copy of the Senate Committee Substitute for Senate Bill No. 466 (SCS for SB 466). Here is an update on the substitute bill as currently proposed.

SCS for SB 466 allows certain eligible employees to retire under a temporary health care retirement incentive. As proposed, employees who are eligible for normal unreduced retirement and whose retirement effective date is on or after June 1 (with July 1 being a more likely first retirement effective date to which it would applicable) but no later than September 1, 2005, would be eligible for the incentive. Such retirees would be able to continue medical coverage for themselves and eligible dependents as if they were active employees for a maximum of three years or until becoming eligible for Medicare, whichever occurs first. The rate would then revert to the applicable retiree rate that is in place at that time. Any employee retiring under these provisions would be prohibited from any employment with any department of state government for a period of three years.

As the sponsor noted in the committee hearing, the substitute includes several changes from the original version in order to make the it more cost-effective and to garner support for the proposal. The medical insurance subsidy was reduced from 5 years to 3 years; the temporary "Rule of 78" has been eliminated; the section that would have allowed unused sick leave to be considered for retirement eligibility has been eliminated; the window period has been changed as described above; and the annual leave payment provisions have been eliminated. One other change is the increase in the prohibition against returning to work for the state from 2 years to 3 years for anyone retiring under these provisions.

The legislation still contains the limit on the number of employees departments may hire to replace those employees who retired during the window. Also, as in the original version of the bill, the boards that govern colleges and universities and the commissions that govern MoDOT and highway patrol benefits and the Department of Conservation may elect to offer the same medical retirement incentive to eligible employees.

The bill has been voted “Do Pass” out of committee, which means that the next step in the process would be for the bill to be placed on the calendar for a third reading (and floor debate). MOSERS will continue to monitor action related to this proposal and post updated information as it becomes available. Print Friendly and PDF

I started with the state when I graduated from High school at the young age of 17. I am 46 years old now and won't be 47 until this September; I have

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I started with the state when I graduated from High school at the young age of 17. I am 46 years old now and won't be 47 until this September; I have 29 years in with the State as of April 1st.

My problem is that with my age and years of service I have to work over 31 years to 80 and out and for back drop I would have to work over 36 years to get 5 years of back drop when most other people would only have to work 30 and 35 years respectably for full retirement.
Does anyone else have this problem? I feel that is reverse age discrimination and a terrible way to treat a dedicated career employee.
As you know, eligibility for retiring under the Rule of 80 is based on a combination of age and service, and not on service alone. Current statistics on new MOSERS retirees shows that the average age at which those members started work with the state was 31.6 years of age. The average retirement age of new retirees is 57.7 years of age and the average amount of service is just under 22.4 years. Since you started work at such a young age, you may be working longer than some other members because of the minimum age requirement of 48, but you will still retire at a younger age and with substantially more service (which is part of the formula that determines your benefit amount) than the average member.

It's important to remember that younger members are more likely to receive benefits over a longer period of time than those members retiring at later ages. Lowering the eligibility age for retirement results in higher costs to the plan, which are paid solely by the employer (the state) and the taxpayers. Print Friendly and PDF

You have answered a question stating that the "Rule of 78" will not change backdrop and employees will not acquire two years of backdrop service. Why

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You have answered a question stating that the "Rule of 78" will not change backdrop and employees will not acquire two years of backdrop service. Why do you say 2 years when "78 and Out" vs. "80 and Out" is only one year of service?

You are correct in your interpretation of "80 and Out." Each year of age must be matched by a year of service, therefore, only one year of service would be applicable in that instance. However, the BackDROP would not be affected by the potential passing of SB 466. Our response to the initial question included language of "2 years" simply because the question addressed it that way. We apologize for any confusion this may have caused. Print Friendly and PDF

My husband worked for the state as a Public Defender. Upon his death I started receiving his pension. If I go back to work for the state will I be abl

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My husband worked for the state as a Public Defender. Upon his death I started receiving his pension. If I go back to work for the state will I be able continue to receive his pension?

Your survivor benefit payments resulting from your husband's death are in no way connected with your ability to work for the state of Missouri and receive a survivor benefit. If you work in a MOSERS covered position in the future, your survivor payments would continue uninterrupted. Print Friendly and PDF

I'm not sure I understood your explanation of SB 375.

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I'm not sure I understood your explanation of SB 375. I have 20 years with the state and will reach 80 and out on 7-1-05. I also have a little over 3 years of active military service that I have not purchased. If SB 375 passes will I be credited for my service? If not, why not? Thank You.

As a member of the MSEP, you are not eligible to receive credit for your military time through SB 375. As the bill is currently written, only those who are members of the MSEP 2000 (those who started in a MOSERS covered position after July 1, 2000) are eligible for the potential military credit after working in such positions at least ten years. In the fiscal information that we provided to the legislature we noted that, as written, this service credit would not apply to members covered by the MSEP (closed plan) which would include those MSEP members who elect to receive retirement benefits under the MSEP 2000 at the time of retirement. Print Friendly and PDF

It appears HB334 would end the .8% temporary benefit when the retiree turns 62 even if Social Security is changed to have reduced retirement at an age

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It appears HB334 would end the .8% temporary benefit when the retiree turns 62 even if Social Security is changed to have reduced retirement at an age greater than 62. Is this correct?

Yes, that is correct. At this time, MOSERS is not aware of any specific proposals offered by Congress that would increase the age at which early Social Security benefits become available. That being said, it is a fiscally prudent move to remove the link between MOSERS temporary benefit and early Social Security benefits so that the state is not locked into a situation over which it has no control. If, in fact, the age for receiving early Social Security benefits should increase at some future date, state legislators would then be able to assess the situation at that time and determine whether or not the age for ending the temporary benefit should also increase. Print Friendly and PDF

I initially submitted my application for retirement to be effective as of May 1, 2005. I also submitted the

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I initially submitted my application for retirement to be effective as of May 1, 2005. I also submitted the additional paperwork for direct deposit, insurance and withholdings. When I realized that the budget would not even be signed before May 6th I requested in writing to change my retirement date. Will I have to submit a new application for retirement or will the one I submitted carry over? Also, I changed the date to June 1st. If I decide to wait yet another month would that require a new application?

As long as you keep MOSERS informed in writing, of your intended retirement date, your initial application and direct deposit, insurance and tax withholdings forms will suffice.
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I am eligible for 80 and out on July 1, 2005. If the bill is passed, the window is from May 1 to Sept. 1, 2005. Would I qualify

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I am eligible for 80 and out on July 1, 2005. If the bill is passed, the window is from May 1 to Sept. 1, 2005. Would I qualify for the incentive-medical insurance if I go ahead with my July 1st date? If this would pass, does it go into effect as of the May 1st date? I am a little confused by your answer to the person who wants to retire June 1, 2005.

As it is currently drafted, SB 466 includes an emergency clause, meaning that it would take effect the day the governor signs it into law. If the bill were to pass, and become law before July 1, you would be eligible for the medical incentive with a July 1 retirement date. If the bill were passed but not signed by the governor until after July 1, you would need to move your retirement to August 1 or September 1 in order to receive the medical incentive. Print Friendly and PDF

I am a vested employee planning to leave employment after 6 years of service. However, I am not old enough to retire.

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I am a vested employee planning to leave employment after 6 years of service. However, I am not old enough to retire. I am age 55. As a vested employee how old must I be before I am able to draw any benefits?

You could retire under the MSEP with a normal annuity at age 65 or under the MSEP 2000 plan with an early (reduced) retirement annuity at age 57 or normal retirement annuity at age 62. Print Friendly and PDF

One of your previous responses on a question about SB375 stated,

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One of your previous responses on a question about SB375 stated, if passed, MSEP 2000 member with at least 10 years of credit service would receive additional credit for qualifying military service. The last line stated: "this bill does not authorize a refund for previously purchased service." Could a current employee who has 10 years of service AND who had already purchased their military time, withdraw their purchase, so to speak, get a refund, and then qualify for SB375? I ask this because is does not seem right that just because an employee purchased time military time, at great financial hardship I might add, that others could follow and receive the credit without purchasing it. What is the current policy with MOSERS on someone who had purchased military time, but now wants out of that option?

Current law does not give MOSERS authority to allow members to withdraw previously purchased service and receive a refund. The law would have to be changed to include this authorization in order for us to refund your previously purchased service. The cost of the refunds for such previously purchased service would then be included in the fiscal information provided to legislators considering the cost of that proposal. At this point, SB 375 is still in the Pensions, Veterans' Affairs and General Laws committee. It was heard in committee on March 8, but has had no movement since then. Print Friendly and PDF

Is the fact that much of the Department of Mental Health's retirement costs are reimbursed by the federal government

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Is the fact that much of the Department of Mental Health's retirement costs are reimbursed by the federal government via interim payments and cost report settlements factored in when determining the net costs of proposed incentives?

No. MOSERS must report any cost increases, without regard to whether the funds are paid from federal funds, grants, special fees or any other source. However, the fiscal information prepared by the Committee on Legislative Research, Oversight Division, does separate the costs into the following categories (1) Estimated Net Effect on General Revenue funds; (2) Estimated Net Effect on Other State funds; and (3) Estimated Net Effect on Federal Funds. In this way the legislature does see the impact on general revenue by itself, as well as the impact on any other funds. Print Friendly and PDF

New Clarification - Do MOSERS initial pension benefits still increase

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New Clarification
Do MOSER'S initial pension benefits still increase by 4% per year for each year an employee continues to work full-time after his 65th birthday?

There is a special Cost of Living Allowance (COLA) for MSEP members who continue to work beyond age 65. (This provision is not applicable in the MSEP 2000.) Upon retirement, your monthly benefit will increase by the annual COLA rate between your 65th birthday and your termination date. For members who were hired prior to August 28, 1997, your annual increase is based on 80% of the change in the Consumer Price Index subject to a minimum of 4% and a maximum of 5%. Otherwise if you were hired on or after August 28, 1997, your annual increase is based on 80% of the change in the Consumer Price Index subject to a maximum of 5%. To qualify, you must meet the following requirements:
  • You must be fully vested at age 65 (at least 5 years of service with the state of Missouri)
  • You must be actively employed by the state of Missouri on your 65th birthday
  • You must retire under the MSEP
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New Clarification - If SB 375 and SB 466 pass,

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New Clarification
If SB 375 & SB 466 pass—would military time be used to compute “78 and out” or “80 and out"? I have 38 months of military time I am thinking about purchasing—if neither bill passes—would it qualify me for “80 and out” if the purchased time took me past the mark? I’m about 24 months shy if the bills don’t pass, and I can’t take an early out.

If SB 375 becomes law, the military service provided under that bill could not be used toward the incentive. However, members wishing to retire under the SB 466 incentive using the "Rule of 80" or the proposed "Rule of 78" could purchase military service under MSEP and use it as creditable service to help them meet MOSERS' retirement eligibility requirements. Given the complexity of your question, one of our Benefit Counselors will contact you personally to discuss the particular details of your situation to make sure we give you the best possible advice on how the acquisition of your military service may affect your retirement. Print Friendly and PDF

We have received numerous requests for updated information regarding SB 466 and the senate committee hearing on April 19, 2005. Rather than providing

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We have received numerous requests for updated information regarding SB 466 and the senate committee hearing on April 19, 2005. Rather than providing duplicate responses to similar questions, we are summarizing what took place at that hearing.
On Tuesday, April 19th, SB 466 was heard in the Senate Pensions, Veterans' Affairs and General Laws Committee. MOSERS’ staff attended the hearing to be available to provide technical comments or clarification, if needed. Senator Vogel presented the bill and stated that he planned to offer several amendments to the proposal in order to make the bill more cost-effective and to garner support for the proposal.

MOSERS has not received copies of a substitute or any of the amendments yet, but the key provisions that were discussed were (1) reducing the medical insurance subsidy from a maximum of 5 years to a maximum of 3 years; (2) eliminating the temporary Rule of 78 eligibility proposal; (3) eliminating the section that would have allowed unused sick leave to be considered for retirement eligibility during the window period; (4) changing the window period to include retirements with effective dates of June 1 through September 1; and (5) eliminating the annual leave payment provisions.

The Commissioner of Administration testified that the administration viewed the amendments as being positive but could not commit to support the legislation without additional financial information regarding the potential impact. He noted that this is not a pure savings to general revenue only. Many of the staff would be from federal or other funds and it cannot always be assumed that, by eliminating these staff, the state saves general revenue. In connection with the retirement incentive in 2003, the state had more staff by the end of the year than they had originally started out with before eligible employees retired. In a circumstance like this, the legislation would cost the state more money.

The committee did not take any action on the legislation so the bill is still in committee. In order for the legislation to move forward, the bill would have to be voted Do Pass out of committee, and placed on calendar for third reading (meaning a floor debate of the bill). In addition, the language could be added to another retirement related bill being considered by the full Senate. MOSERS has no way of knowing what the outcome will be; however, we will continue to monitor action related to this proposal and post updated information as it becomes available. Print Friendly and PDF

The summary of the bill SB 466 has a paragraph for the incentive for 80 and out and another paragraph for 78 and out.

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The summary of the bill SB 466 has a paragraph for the incentive for 80 and out and another paragraph for 78 and out. Each paragraph indicates a different incentive amount for health insurance. The 80 and out would be the cost as an active employee whereas 78 and out would be a 70% incentive.

SB 466 would, if enacted, allow employees who are otherwise eligible to retire and who do retire on or after the effective date of the act but no later than September 1, 2005, to continue medical coverage for the member and eligible dependents at the active employee rate for a maximum of five years or until becoming eligible for Medicare, whichever occurs first, at which time the rate reverts to the applicable retiree rate in place at that time.

The proposal also would allow employees, who would not otherwise be eligible, to retire under a Rule of 78 and further provides that unused sick leave may be used for retirement eligibility. As proposed, members retiring under the Rule of 78 may continue medical coverage for themselves and eligible dependents at 70% of the active employee rate for a maximum of five years or upon becoming eligible for Medicare, whichever occurs first, at which time the rate reverts to the applicable retiree rate in place at that time. This provision would apply only to qualifying employees who retire on or after May 1, 2005 but no later than September 1, 2005.

As stated in the summary above, Senator Vogel has indicated that he intends to amend the legislation to eliminate the 78 and out provisions in order to make it more cost-effective and garner support for the bill. Print Friendly and PDF

The prohibition of employment for two years is in the 78 and out paragraph. Does this mean a person taking the 80 and out health incentive can be re-e

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The prohibition of employment for two years is in the 78 and out paragraph. Does this mean a person taking the 80 and out health incentive can be re-employed part time?

SB 466 prohibits any employee making an election to retire under the incentive from being reemployed, including part-time employment, with any department for a period of two years (including employees of the colleges and universities). Print Friendly and PDF

One of the changes is the time frame for the incentive plan from June 1 to Sep 1 (rather than May 1 to September 1).

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One of the changes is the time frame for the incentive plan from June 1 to Sep 1 (rather than May 1 to September 1). I am eligible to retire on 10-1-05. Can I use annual or sick accrual leave to qualify for a month early retirement so I fit into the incentive plan window of time frame?

No. As stated in the summary above, Senator Vogel has indicated that he intends to amend the legislation to eliminate the provisions that would have allowed unused sick leave to be considered for retirement eligibility during the window period. Annual leave cannot be used for eligibility purposes. Print Friendly and PDF

I have heard that SB 466 has had several changes made to it recently. Where can you go on-line to see what SB 466 now looks like since all the changes

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I have heard that SB 466 has had several changes made to it recently. Where can you go on-line to see what SB 466 now looks like since all the changes
The changes to SB 466 were discussed in committee; however, we have not yet received any additional language. As always, you can follow the legislation under the joint bill tracking device available on the general assembly website at www.moga.mo.gov. Print Friendly and PDF

We have received several questions regarding the fiscal information filed on SB 466

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We have received several questions regarding the fiscal information filed on SB 466 and any potential cost savings that could be realized as a result of the incentive. Rather than providing duplicate responses to similar questions, the following summary provides information on how retirement incentives are evaluated.

The most reliable source of fiscal information and cost savings on SB 466 can be found at www.moga.mo.gov by clicking on the LR Fiscal Note Number in the upper right hand corner of the bill summary.

Generally, it is very difficult to speculate on cost savings realized as a result of retirement incentives since savings are largely dependent on permanent reductions in the workforce. Experience in other states indicates that most, if not all, of the positions that are vacated as a result of retirement incentives are eventually refilled resulting in higher retirement costs over the long term with minimal payroll savings.

However, given the current state fiscal constraints, the retirement incentive has been proposed as a means to further reduce payroll costs by encouraging those presently eligible for retirement or those nearing retirement to leave state employment. They must evaluate the likelihood of these positions being permanently removed from departmental budgets against the costs associated with the incentive. In addition, it is also important to remember that the state is still paying for 3 years of retiree medical subsidies related to the previous retirement incentive enacted in 2003. Print Friendly and PDF

I have been reading “Rumor Central”—Are SB 375 and SB 466 separate bills? Do they have an equal chance?

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I have been reading “Rumor Central”—Are SB 375 and SB 466 separate bills? Do they have an equal chance?
SB 375 and SB 466 are, in fact, separate bills. You can find bill summaries and copies of the bills at www.house.mo.gov/jointsearch/. Both bills have been assigned to the Senate Pensions, Veterans' Affairs and General Laws Committee. SB 375 was heard in the committee on March 8th and SB 466 was heard in the committee today, April 19th. Unfortunately, MOSERS staff has no way to determine whether a bill will pass or not. We encourage you to check the website above periodically to see if further action has been reported on either bill. Print Friendly and PDF

Would uncertified positions with school districts or community colleges be considered State employment?

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Would uncertified positions with school districts or community colleges be considered State employment?
The service you reference would most likely qualify as public employment, not state employment. It also may be service that was covered by a non-teacher's retirement system such as the Public School & the Non-Teacher School Employees’ Retirement System of Missouri. In either case, you may be able to purchase or transfer some or all of such public service to obtain additional service credit in MOSERS. You can find more information regarding this matter and an Application to Purchase Public Service Credit brochure here on our website. Please contact a Benefits Counselor at (800) 827-1063 to obtain more information about your particular other public employment. Print Friendly and PDF

I heard a rumor that SB 466 is going to die in committee and that the State has opted to just layoff employees instead of offering the early retiremen

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I heard a rumor that SB 466 is going to die in committee and that the State has opted to just layoff employees instead of offering the early retirement.

At this time, SB 466 is still in the Senate Pensions, Veterans' Affairs and General Laws committee. The bill was heard in committee on Tuesday, 4/19. The statement above is not attributed to any particular person, so we cannot verify it. We are not aware of anyone in the legislature or the administration who has announced that the bill will die in committee. Print Friendly and PDF

I'm still not clear on the BackDROP issue concerning SB 466.

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I'm still not clear on the BackDROP issue concerning SB 466. If a member is now eligible for 3yrs of BackDROP and retires during the "78 and out" provision, will another two years be added to the BackDROP, making the maximum of five years? Otherwise, the incentive seems to be to get members to retire two years earlier than the present "80 and out" with two years less benefits.

In order to currently be eligible for 3 years of BackDROP, a member would have to have been eligible to retire with a normal annuity 3 years ago. In that case, the member would not be eligible to retire under 78 & out since the member is already eligible for normal retirement. However, the member would still be able to participate in the incentive by virtue of being eligible for normal retirement. The incentive is designed to encourage members who are currently eligible to retire (or who would be eligible under 78 & out) to terminate employment and retire by providing them a significantly lower retiree medical insurance rate than would otherwise be available. The incentive would not provide any additional BackDROP service and also would not change the law that created the BackDROP in any manner. (For clarification of the impact of a “Rule of 78,” please note that it would only make members eligible one year earlier, not two years.) Print Friendly and PDF

I am able to retire Oct. 31 under the 80 and out rule. Should I send in my paperwork now in case

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I am able to retire Oct. 31 under the 80 and out rule. Should I send in my paperwork now in case the 78 and out rule becomes effective? Will I be eligible to retire under it if I already have my paperwork in?

Members who wish to take advantage of the possible retirement incentive must follow MOSERS' current application process. If SB 466 passes, members may retire under the incentive after the bill is signed into law until September 1, 2005. Members must be actively employed when the bill becomes law in order to qualify for the incentive. If enacted, the probable window period would include July, August, and September. Members wishing to retire in July must have their application to MOSERS by May 31. Those wishing to retire in August must have their application in by June 30, and September retirees must have their applications in by July 31. MOSERS can accept an application from a member who is not eligible for retirement as long as the member is eligible to retire by the first of the month in which the payment of the retirement benefit would commence. For instance, in the event you anticipated retiring under 78 and out effective July 1, you could file your application to retire now and use July 1 as your retirement date. If SB 466 becomes law in its current form, you could retire under the 78 and out provision effective in July. If SB 466 does not become law (or becomes law but does not contain the 78 and out provision), you would not be eligible to retire on July 1 and your application would not be processed. In that event, you would need to reapply for an October 1 retirement date (assuming you are eligible to retire on that date under 80 and out) by filing another application with the system by August 31. Print Friendly and PDF

Assuming that I retire effective June 1, 2005 and the bill is signed in the middle of June, since that window is April 1 till Sept. 1, will my insuran

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Assuming that I retire effective June 1, 2005 and the bill is signed in the middle of June, since that window is April 1 till Sept. 1, will my insurance go back to what it would have been?

The current language of the bill has an “emergency clause” which would make it effective the day the governor signs it into law. The incentive window would only be open from that date until September 1. Therefore, if SB 466 passes as currently drafted, and a member retires before the Governor signs the bill, that member is not eligible for the incentive. They would either have to postpone their retirement date until after the bill is signed, or they could retire June 1, and would not be eligible for the incentive, assuming the bill received gubernatorial approval the middle of June.

For further details on this subject, please refer to the posting on 4/7. Print Friendly and PDF

My question concerns SB375. I ask about the current understanding of what this bill really means.

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My question concerns SB375. I ask about the current understanding of what this bill really means. I spoke to a MOSERS representative who said that the bill was addressing only those military personnel who recently were called to active duty. However, the bill language states will be credited for all the years that person served in the military. The other language in the bill said that the service member must have been honorably discharged. As the call up to active duty a group of citizen solders who have not served long enough to be discharged. In its present state the bill seems to focus on a very small group. Will you clarify what this bill is about and the target group?

As the bill stands today, it only applies to MSEP 2000 members, meaning those employed after June 30, 2000. As for the specific intent of the bill, MOSERS can only speculate at this point, but we did give notice to the sponsor in the fiscal information we provided that the bill, as drafted, would not apply to members covered by the MSEP. However, if SB 375 were to pass, members who have military service that meets the same guidelines applied to our current military service acquisitions (transfers and purchases) would be eligible to receive credit for that service (includes all active service performed in the United States Army, Air Force, Navy, Marine Corps, Coast Guard, and members of the United States Public Health Service or any women's auxiliary thereof; and service in the Army national guard and Air national guard when engaged in active duty for training, inactive duty training or full-time national guard duty, and service by any other category of persons designated by the President in time of war or emergency). It also requires that members be honorably discharged. Short duration active-duty military service such as two-week summer camps in reserve forces may qualify. Print Friendly and PDF

I have insurance for my husband and myself. When you choose your insurance coverage the system sets it up for a year's coverage

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I have insurance for my husband and myself. When you choose your insurance coverage the system sets it up for a year's coverage (January through December). When you reach 65 (like if it is in April, which is my husband's situation) does the insurance amount change at that point or are you obligated for the entire year at the amount/coverage you selected?
Also when you turn 65 does the insurance amount change so that you pay only the supplement?

We received the following information for members who have health insurance through the Missouri Consolidated Health Care Plan (MCHCP):

The insurance plan a subscriber has when (s)he retires is the one the subsriber keeps for the remainder of the calendar year. The subscriber can continue their spouse's coverage when (s)he retires. When either the subscriber or the spouse become 65 the premium rate will change to reflect Medicare coverage (please refer to the next paragraph). The subscriber can terminate coverage on either himself or herself or on their spouse (the spouse cannot be covered unless the subscriber is) at any time. However, after retirement, if (s)he terminates coverage on herself and/or her husband (s)he can never re-enroll.

At 65 a retired member's MCHCP plan becomes secondary to Medicare and premium rates are adjusted accordingly. The MCHCP plans are coordinated with Medicare so the member needs to sign up for Medicare Part B prior to her/his 65th birthday. The member can refer to the MCHCP Enrollment Guide which shows rates with and without Medicare.

If you have other questions about MCHCP benefits, please contact them at (800) 487-0771 or mchcp@mchcp.org.

Note: If you have health insurance through the Dept. of Conservation or through any of the regional colleges and universities, contact your Human Resource department for further information on this question. Each of those plans may have different rules and regulations regarding this issue. Print Friendly and PDF

I understood the original bill stated that a retired employee could not return for 24 months after retirement if the bill passed. Is this still part o

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I understood the original bill stated that a retired employee could not return for 24 months after retirement if the bill passed. Is this still part of the bill?

SB 466, in its original form, would have prohibited employees who take advantage of the proposed incentive from working for the state in any capacity for twoyears following their retirement date. The substitute for SB 466 contains the same provision. Print Friendly and PDF

It is difficult for me to understand what the cost of SB 466 would be by reading the fiscal note.

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It is difficult for me to understand what the cost of SB 466 would be by reading the fiscal note. What would the cost to MOSERS or the state be to make the change from Rule of 80 to Rule of 78 over that three-month period?

If the 78-and-out provision put an individual into BackDROP status, would the BackDROP be available?

Cost of 78 and out: As written, there would be approximately 6,400 employees eligible to retire under the proposed legislation. Of those employees, 1,200 would not qualify under rule of 80 but would qualify under the 78 and out provision.

It is difficult to estimate how many employees will actually retire during this window. If 30% of those eligible retire, and 50% of those positions are filled, the estimated cost would be approximately $13,630,000 per annum. This would translate into an increase in the present contribution rate of 12.59% of payroll to 13.67% of payroll (an increase of 1.08% of payroll).

BackDROP: An employee retiring under the 78 and out provision would not be eligible for the BackDROP. To qualify for retirement under the 78 and out provision, the employee would first become eligible for normal retirement, and have to actually retire, during the temporary window.

To qualify for the BackDROP, an employee must work at least two years beyond the date first eligible for normal retirement. Since the employee would first become eligible and retire during the temporary window, the employee would not be eligible for the BackDROP. Print Friendly and PDF

Is MOSERS aware of any plans being proposed to change or eliminate the BackDROP? If so, what and when?

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Is MOSERS aware of any plans being proposed to change or eliminate the BackDROP? If so, what and when?
No, we are not aware of any such plans. To our knowledge, no legislation has been drafted proposing elimination of the BackDROP. Print Friendly and PDF

If I were able to retire at 78 and out if the bill passes, which I would qualify for on July 1, will I still be able to get the temporary benefit unti

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If I were able to retire at 78 and out if the bill passes, which I would qualify for on July 1, will I still be able to get the temporary benefit until I am 62? And how do you figure how much it will be?

As currently drafted, the MSEP 2000 temporary benefit does apply to the temporary "Rule of 78" provision also.

Each individual member has a different benefit amount based on their specific amount of service and salary. The following is the formula used to calculate the temporary benefit.

Final Average Pay x Years and full months of credited service x multiplier (0.008) = Temporary benefit.

An example follows – you would need to substitute information regarding your own circumstances to estimate the amount that would be payable to you:

Final average pay: $2,000
Credited Service: 25 years 6 months
Multiplier: 0.008

$2,000 x 25.5 x 0.008 = $408.00 Print Friendly and PDF

I understand that there is a state law that mandates that a retiree under the "80 and out" provision who is reemployed

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I understand that there is a state law that mandates that a retiree under the "80 and out" provision who is reemployed by the state and works more than 1000 hours per year must not only forego his or her annuity but also pay back the annuities previously received. However, I cannot find that provision. Is there such a provision, and if so, where is it located?

If a MOSERS retired member returns to state employment in a benefit eligible position, the member’s retirement benefit will be stopped while the member is reemployed. This applies to any retiree, not just those who retired under the "Rule of 80." Members do not have to repay annuities previously received unless they received a salary for service in a benefit eligible position and a retirement benefit during the same month. If you are interested in reading the statutes pertaining to this particular provision, it can be found in the State of Missouri Revised Statutes; 104.380 for the MSEP and 104.1039 for the MSEP 2000. Print Friendly and PDF

I was eligible to retire 0n 09-01-04 and have decided to stay to receive a BackDROP to help pay for my part of my health insurance.

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I was eligible to retire 0n 09-01-04 and have decided to stay to receive a BackDROP to help pay for my part of my health insurance. I have 32 years in service and will only be 50 years old. If SB 466 does not allow for a person to use the 78 and out to count toward your BackDROP it will then cause a person like me to have to stay employed at least 1 more year to receive any BackDROP. Then the 5 year on insurance will be off the board so therefore people like me will gain nothing because my BackDROP will be eaten up to pay for my insurance. So therefore I will need to work more years to even things out. Do you feel like this might be changed so it won’t punish people in my position? If they would it would allow me to go this year after 32 years of good employment as I feel that would be nice after people like me have given so much to the state. Thank you.

MOSERS has not received word of another substitute for SB 466. The bill is still in the senate committee and has not been heard yet, and we do not know if any changes are being considered. You can track the bill's progress, and review changes (if any are made) in the bill at the Missouri General Assembly’s website: www.house.mo.gov/jointsearch/.

It should be noted that as proposed, your cost of health care would be less than you have probably been anticipating in connection with your planned use of BackDROP proceeds. Print Friendly and PDF

SB466 has 2 paragraphs which discuss the medical incentive, one directed toward those who have already met requirements to retire and the other toward

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SB466 has 2 paragraphs which discuss the medical incentive, one directed toward those who have already met requirements to retire and the other toward the 78 and out provision. The portion regarding 78 and out seems to indicate that those who were able to use this option should it pass, would be required to go under MSEP 2000. As the other paragraph does not include this requirement, would we be allowed to use MSEP if meeting that point of already being eligible to retire. I ask because for some, you could be qualified for retirement under MSEP and a backdrop and not under MSEP 2000.

The medical provision provided in SB 466 would be available to those retiring in either the MSEP or the MSEP 2000. The bill does not specify a particular plan for those wanting to take advantage of the medical incentive. If SB 466 passes, members eligible to retire under "Rule of 80 " and the temporary "Rule of 78" would both be eligible to take advantage of the medical provision during the incentive window. Print Friendly and PDF

I would like to retire June 1st regardless of whether SB466 passes or not. If the bill is signed into law after I retire will I still be eligible for

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I would like to retire June 1st regardless of whether SB466 passes or not. If the bill is signed into law after I retire will I still be eligible for the medical insurance benefit?

If SB 466 passes, the medical insurance subsidy in the bill would only be available to those who retire after the legislation becomes effective and during the specified incentive window. A June 1, 2005 retirement date would not be eligible for the medical insurance subsidy if the legislation became effective after that date, as it would fall before the incentive window. At this time, MOSERS has no way of knowing when or if SB 466 will pass, and ultimately cannot advise members who are unsure as to whether to wait for the incentive or retire as previously planned. Print Friendly and PDF

I know the legislature has until May 6 to finalize appropriation bills but doesn't conclude until May 13. Would SB 466 have until May 6 or May 13th

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I know the legislature has until May 6 to finalize appropriation bills but doesn't conclude until May 13. Would SB 466 have until May 6 or May 13th to be passed by both the House and Senate? I know it isn't an appropriation bill per se, but definitely has huge financial implications so I didn't know which deadline would be effective for SB 466.
The way the bill is written, am I correct to understand that if it is passed, you could not retire and take advantage of the bill's offering until after the Governor has signed it. If it is passed on the last day of the session, until what date would the Governor have to sign the bill? Because if he signed it after June 30th, that would negate folks being able to retire September 1 unless they already had the paper work turned in to MOSERS, correct?

The 2005 legislative session ends on May 13. Proposed bills may be amended and/or finally passed up until that date. Assuming SB 466 were to pass on the last day, Governor Blunt would have until July 14th to sign or veto the bill.

SB 466 has an emergency clause, meaning that, if passed, it would become effective the day the governor signs it into law. September 1st would be the last effective retirement date members could use to take advantage of this proposal. September 1 retirees must have their applications in to MOSERS by July 31. In anticipation of retiring under the SB 466 incentive, members may want to submit their applications for retirement. July retirees must have their applications in by May 31 and August retirees must submit applications by June 30. In the event the bill does not pass, members (technically) may rescind their retirement any time up until their first benefit payment is issued. If you informed your employer that you intended to retire and later decide to rescind your retirement, you will need to communicate with your employer to determine if you may continue your employment past your scheduled termination date. Print Friendly and PDF

Is it possible to "buy" previous, non-credited service to add for service credits? Or, is military service the only service eligible for this purpose?

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Is it possible to "buy" previous, non-credited service to add for service credits? Or, is military service the only service eligible for this purpose?
In addition to military service, members with prior public employment in Missouri have the option to purchase their previous time to add on to their MOSERS service if it is not credited in another system. Several types of public employment are eligible for purchase such as public school or city or county local government employment. For further information on purchasing service, including purchase applications, please refer to our Acquiring Service Credit brochure. Print Friendly and PDF

I will have 80 and out Dec. 1, 2005. Do I take a reduction in my retirement if this bill should pass?

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I will have 80 and out Dec. 1, 2005. Do I take a reduction in my retirement if this bill should pass? I do not have the state insurance and want to go early if possible. What would the penalties be under this bill? Also, does this address the backdrop? If you have 80 and out do you quality for backdrop since it is only needed to have 78 and out?

The incentive provided by SB 466 would reduce the normal retirement requirements from "80 and out" to "78 and out" for a limited time. Because it temporarily alters the age and service necessary to qualify for normal retirement, members retiring under this incentive would not take a reduction in retirement benefits. No benefit reduction would result from retiring if you qualify for "78 and out" (other than having less service credit and possibly a lower final average pay than you would have had if you had continued in service until qualifying for "rule of 80").The temporary "Rule of 78" will not change the BackDROP provision, therefore those eligible for "Rule of 78" will not be able to acquire two years of BackDROP service. Print Friendly and PDF

Today, I was told that both the House and Senate supported this bill. However, since Governor Blunt did not support any type of incentive for retireme

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Today, I was told that both the House and Senate supported this bill. However, since Governor Blunt did not support any type of incentive for retirement, the bill will be killed. Is this true?

SB 466 has not yet been heard by either a Senate or House committee, so it would be premature to claim that they support (or oppose) the bill. To our knowledge Governor Blunt has not made any statement about SB 466 or about whether or not he has a position on retirement incentives in general. Print Friendly and PDF

Considering SB 466, will State Employees be able to return to work for the State if they work less than 1,000 hours per year?

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Considering SB 466, will State Employees be able to return to work for the State if they work less than 1,000 hours per year?
In the event that SB 466 passes, members who retire within its specified incentive window will be eligible for a medical insurance subsidy. According to the bill in its current form, those members who take advantage of the medical subsidy would be prohibited from "any employment" with the state for a period of two years. After that two year time frame, those retired members would be able to return to work for the state in a position that is not eligible for retirement benefits. Typically, positions such as those are defined to be less than 1,000 hours. It is up to each agency to determine whether or not a position is eligible for benefits. Print Friendly and PDF

Can sick leave be used to qualify for 80-and-out?

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Can sick leave be used to qualify for 80-and-out? My scheduled retirement date is Dec. 2006 and I have more than 2000 hours of sick leave. Also, can sick leave be used to qualify for BackDROP?

Unused sick leave cannot be used to determine eligibility for retirement benefits. Therefore, it cannot be used to qualify for the "Rule of 80", or as qualification for the BackDROP, etc. However, if SB 466 passes as presently written, it would allow members to use unused sick leave to qualify for the "78 and out" provision during the bill's incentive window (the date the bill is signed into law until September 1, 2005). Print Friendly and PDF

There is a rumor in Department of Social Services that SB 466 will lower the eligibility to 75 and out.

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There is a rumor in Department of Social Services that SB 466 will lower the eligibility to 75 and out. This is probably in response to the fact that DSS must trim more money from their budget. Any information on this?

According to the current version of SB 466, the incentive window will lower the age and service for normal retirement from "80 and out" to "78 and out." MOSERS has not received any word of plans to lower the rule from 78 to 75. Print Friendly and PDF

If the senate bill does pass, how will it affect the BackDROP? Will the changed retirement term add to the BackDROP term?

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If the senate bill does pass, how will it affect the BackDROP? Will the changed retirement term add to the BackDROP term?
SB 466, if passed, will have no effect on the BackDROP as it currently exists. For additional information on the BackDROP, please see the posting made on 4/6 regarding the BackDROP and “78 and out.” Print Friendly and PDF

With bills, such as SB 466, is it possible for MOSERS to inquire as to what the intentions are for boards that govern Truman University, Lincoln

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With bills, such as SB 466, is it possible for MOSERS to inquire as to what the intentions are for boards that govern Truman University, Lincoln University, the colleges and universities, and the commissions that govern MoDOT and the highway patrol and the Department of Conservation, as to whether they plan to offer the same healthcare retirement incentive to eligible employees.
It would seem for the legislators, possible retirees, MOSERS, and the institutions involved, planning scenarios will be facilitated by this knowledge.
If SB 466 passes and is signed by the Governor, MOSERS' and MCHCP's boards do not have the option of choosing whether or not to adopt the incentive. We will pass your question on to the other institutions, but our expectation is that they may not be ready to make a decision. More than one month remains in this legislative session, and if the bill moves forward it could be revised and amended many times. Any one revision could make the applicable governing bodies more or less receptive to adopting the provisions of the bill. We expect that the institutions may decline to take a position until they see a final version. We will inquire and if we receive responses indicating those boards' definite positions, we will post them as we receive them. Print Friendly and PDF

I’m hearing the committee has thrown out the drafted bill and is wanting to re-do it to make it a better offer. Is this true?

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I’m hearing the committee has thrown out the drafted bill and is wanting to re-do it to make it a better offer. Is this true?
Senate Committee Substitute for SB 466 has been filed that makes slight changes to its original intent. The original included text would have allowed members who retire to take advantage of the medical subsidy, who also have accumulated annual leave worth more than $2000, to receive their annual leave payment in two installments. The substitute removes the provision permitting two installments, requiring rather that the annual leave accrual be received in one payment. All other aspects of the original bill remain unchanged in the current substitute. Print Friendly and PDF

I have planned to retire this month, with last day worked April 28, (with a May 1 effective date) at age 62. Should I change my retirement date

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I have planned to retire this month, with last day worked April 28, (with a May 1 effective date) at age 62. Should I change my retirement date to a date in May in order to qualify for the SB466 insurance rate?
Should SB 466 pass as proposed, you would have to be actively employed on the date it is signed into law by Governor Blunt in order to take advantage of the incentive. Since we can only speculate on the timing of this bill, and whether or not it will pass, you should monitor the bill’s progress and use your best judgment in terms of scheduling your retirement date. If passed, the governor would have until July 14th to approve or veto the legislation. If you do decide to postpone you retirement date and continue in active state employment, please remember the application process MOSERS requires for retirement planning: July retirees must submit their applications by May 31, August retirees by June 30, and September retirees by July 31. Also keep in mind that you may rescind your application up until the date your first retirement benefit payment is issued. Print Friendly and PDF

If SB 466 passes, is the Rule of 78 just going to be effective during this short time frame stated in the law or is it going to change the "80 and out

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If SB 466 passes, is the Rule of 78 just going to be effective during this short time frame stated in the law or is it going to change the "80 and out" rule to the rule of 78? Will this then be considered "normal retirement" and allow those who have worked longer to be eligible for BackDrop monies?

In the event that SB 466 becomes law, the "Rule of 78" will be considered normal retirement during the bill's incentive window which would, as currently written, be the date the bill is signed into law until September 1, 2005. The "80 and out" rule would remain intact, and become effective again for members retiring after September 1, 2005. The temporary "Rule of 78" would not change the BackDROP provision, therefore those eligible for "Rule of 78" will not be able to acquire two years of BackDROP service. Print Friendly and PDF

Doesn't MOSERS support bills that are in the best interest of the membership, whether retired or active? Where does MOSERS stand on SB466?

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Doesn't MOSERS support bills that are in the best interest of the membership, whether retired or active? Where does MOSERS stand on SB466? I think that MOSERS should be supporting it. Everyone I talk to wants to see it passed. Newer employees will gain because of the need to backfill vacated positions. Of course, this applies only to those agencies that the bill exempts.
The MOSERS Board of Trustees has adopted a governance policy with respect to legislation. This policy was developed to ensure that board members and staff act as fiduciaries first, and speak with one voice when taking official positions on legislation. The policy also reduces the potential for conflicts of interest by serving as the framework through which all legislative proposals are evaluated.

The policy generally requires MOSERS staff to serve as technical advisors. MOSERS staff reviews all proposed legislation affecting MOSERS programs, providing technical comments and fiscal (cost) information to members of the General Assembly who sponsor legislation, and the appropriate legislative oversight agencies. Staff has also been instructed to offer alternatives and provide an unbiased analysis, including the pros and cons of proposals, when appropriate.

Exceptions to this neutral/technical approach allow the board and/or staff to support legislation that corrects potential legal problems or structural deficiencies or that adds protections to the trust. Legislation may be opposed if it threatens the trust or deprives members of vested benefits without an equivalent compensating benefit.

While many members may be supportive of SB 466 there may also be individuals opposed to it. In addition to active members we also must consider our retired members when determining what legislation is in the "best interest of the membership." Retirees will not benefit from the provisions of SB 466 (and most did not benefit from the previous incentive in 2003.)

The bill is best characterized as one proposal to address part of the state budget cuts that are currently being considered by the General Assembly. The legislature and state budget authorities are in the best position to debate and determine whether the additional costs of the proposed retiree medical subsidies (and the remaining 3 years of subsidies on the previous incentive) are the best way to address these budget concerns. Print Friendly and PDF

Since the proposal in this bill is also for a "78 and out", can those people who've already met the "80 and out" apply the extra two years

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Since the proposal in this bill is also for a "78 and out", can those people who've already met the "80 and out" apply the extra two years to their "BackDROP" requirement of having to work two years beyond their initial retirement date?

SB 466 would provide a window of time (from the date the bill is signed into law until September 1, 2005) for MOSERS members to retire under a "78 and out" rule if they were not otherwise eligible to retire during that time. However, this will not change eligibility requirements for the BackDROP provision. As it is currently written, SB 466 does not change current or future BackDROP retirement requirements. Therefore, any members who retire during the proposed window period would only be eligible for the BackDROP if they would have otherwise qualified without the "Rule of 78" and the length of the BackDROP period would not be impacted by the "Rule of 78." (To clarify another point in the question, a "Rule of 78" would make active members eligible one year earlier than would otherwise be the case – not two years as is suggested in the question. i.e., a member age 54 with 24 years of service would qualify for "Rule of 78" – one year later that member would be 55 with 25 years of service and qualify for "Rule of 80.") Print Friendly and PDF

Is there a “mandatory 80 & out” going on?

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Is there a “mandatory 80 & out” going on?
No. However, it is possible that employees whose jobs are eliminated due to budget cuts may choose to retire (if otherwise eligible) sooner than they had planned. At any point in time there are typically over 5,000 members who are eligible for retirement but who have elected to continue working. Many of them first became eligible for retirement under the "Rule of 80." That may be why you hear more talk about "80 & out." Print Friendly and PDF

As the bill has been presented to Committee, does it apply only to those eligible for 78 and out or does it include employees eligible for normal

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As the bill has been presented to Committee, does it apply only to those eligible for 78 and out or does it include employees eligible for normal retirement as well?

SB 466, as currently drafted, would apply not only to those who would be eligible for 78 & out but also to active general state employees who are currently eligible to retire with a normal (unreduced) annuity between the effective date of the bill and September 1, 2005. As we understand it, however, the health care subsidy is intended to be greater for those eligible for retirement under current provisions as opposed to those who would only be eligible if a "rule of 78" provision were temporarily in place. Print Friendly and PDF

In regards to proposed SB466: I am not currently able to retire but will be as of the end of August, 2005. I am unclear as to the wording of the bill

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In regards to proposed SB466: I am not currently able to retire but will be as of the end of August, 2005. I am unclear as to the wording of the bill and wonder if the proposed insurance subsidy would apply to persons such as myself. Thanks.

The current provisions of SB 466 would be available to active general state employees who retire with a normal annuity between the effective date of the bill and September 1, 2005. If the bill were to pass and become law with those provisions intact, it could apply to someone in your situation. Bear in mind that in order to retire September 1, MOSERS must receive a retirement application no later than July 31. Print Friendly and PDF

This bill states that the proposed medical premium for retirees using 78 and out is based on $570.00 per month and calculated by retiree's years

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This bill states that the proposed medical premium for retirees using 78 and out is based on $570.00 per month and calculated by retiree's years of service multiplied by 2.5%. Why are they using $570.00 as the base amount and assuming this bill would pass, what would be the insurance rate for retiree and spouse without Medicare?

As this question pertains to the medical incentive, which is not administered by MOSERS, we referred the question to the Missouri Consolidated Health Care Plan (MCHCP) and received the following answer:

“The $570 amount included in the question is not referenced in the bill and should not be considered the 'base' amount. It is simply the current average monthly state contribution amount that is transferred to MCHCP for each active employee covered under the plan. The actual base amount will vary depending upon the location of the individual retiree and the low cost health plan option available in that county.

Also, an actual rate for a non-Medicare eligible retiree and spouse is not available because it will depend upon the low cost plan, the length of service of the retiree and the level of coverage (single, family, etc.). Employees may use a calculator available on our website, http://www.mchcp.org/ to determine their respective rate.”

Finally, please note that the boards that govern Truman University, Lincoln University, the colleges and universities, and the commissions that govern MoDOT and the highway patrol and the Department of Conservation may elect to offer the same healthcare retirement incentive to eligible employees. Print Friendly and PDF

Will the retirement incentive be offered if it passes before employees are laid off?

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Will the retirement incentive be offered if it passes before employees are laid off?
SB 466 contains an emergency clause, which means that if it were to pass with its current provisions, it would go into effect immediately upon the Governor's signature. At this point, the bill is still in committee and we have no way of knowing when, or if, it will move forward or what changes might be made along the way. Since no one can predict whether the bill will pass or not, layoffs may occur in the interim, if an agency is required to reduce its budget immediately. Based on the current wording of SB 466, only members who are employed on or after the effective date will be eligible for the incentive (assuming they meet the other requirements in the legislation). If an employee is laid off prior to the bill being passed and signed by the Governor, that employee would not eligible for the incentive. Print Friendly and PDF