The Administrative Policies
TAP NO. 2: POST RETIREMENT HEALTH REIMBURSEMENT ACCOUNT
A. PLAN DESIGN
The minimum requirement for participation in the Duquesne University sponsored Health Reimbursement Account will be the attainment of age 62 and 10 years of full-time continuous service with the University.
Credits and Contributions
Duquesne will commit to a fixed number of "credits" to help retirees purchase medical coverage. The number of credits allotted will be reviewed each plan year. A credit is the same as a dollar.
The number of credits will be based upon the retiree's years of continuous service with the University.
Years of service will be based upon the employee's anniversary date. Partial years of service will be granted on a prorated basis.
Breaks in service - Employees who meet the minimum eligibility will have all time worked for the University count towards this benefit, regardless of any breaks in service which may have occurred. Breaks in service, however, will not be counted as time worked in the formula. For example: An employee, age 62, had 5 years service; left the University for 3 years; then returned for 10 years. This employee would be entitled to credit for 15 years of service.
Each year of service earns credits of $3.33 per month during retirement. For example: a retiree with 15 years of service would receive 15 x $3.33 per month, or $49.95 per month in flex benefit credits for the purchase of medical coverage. A retiree with 15 years and 6 months of service would receive 15 and 6/12 x $3.33 per month, or $51.61 per month in credits.
Each month after retirement, the retiree will receive the number of credits indicated by the formula. These credits may be used to the extent needed for the purchase of medical coverage. Excess credits will accumulate for use in future years.
There is no maximum number of years of service for which credits will be accumulated.
Credits may be used to purchase medical coverage directly from an insurer of the retiree's choice.
Medical coverage for eligible dependents may be purchased with excess credits and/or retiree contributions.
If at retirement, the retiree wants to delay the use of credits, (for example, because of coverage by a working spouse, etc.) the delay may be accomplished by indicating "accumulate for future use" on the Retiree Credit Form.
Retiree contributions will be necessary to pay the difference between the plan cost and the available credits.
Health Reimbursement Account (HRA)
The University will deposit credits on a quarterly basis into a Health Reimbursement Account established in the retiree's name with a third party administrator.
An HRA is an IRS approved, employer-funded, defined contribution employer health benefit plan that reimburses employees for out-of-pocket health insurance premiums. An HRA is not health insurance. The HRA allows the employer to make contributions to an employee's account and provide reimbursement for eligible expenses.
Retirees have the option of using their credits to purchase medical coverage from the insurer of their choice, or accumulating their credits for future use.
The Benefits Office staff will forward COBRA information (if required), life insurance conversion information, and a Retiree Credit form to the retiree's home address after the retirees final pay processing. The retiree is responsible for completion and return of the Retiree Credit form. The form is used to select the application of their credits (accumulate, COBRA medical premium payment, or establish Health Reimbursement Account.)
The Benefits Office staff will process the Retiree Credit form and respond with COBRA payment coupons or Health Reimbursement Account instructions as needed.
Excess credits may be used to purchase medical coverage for dependents. Eligible dependents are defined as:
A spouse enrolled under the group medical program prior to the Duquesne University employee's retirement.
A dependent(s) enrolled under the group medical program prior to the Duquesne employee's retirement.
Death of Retiree
Upon the death of the retiree accumulated credits can be used by an eligible surviving dependent to continue coverage.
If there are no eligible surviving dependents the accumulated credits will be forfeited.
Duquesne University, through the Office of Human Resource Management, will be responsible for the administration of the plan internally or through a third party administrator.
The University, through its Benefits and Budget Committees, will review the credit value to ascertain that the allowances for credits meet the financial objectives of the University, while at the same time addressing the needs of retirees to be able to afford medical coverage.
C. AMENDMENT AND TERMINATION
Duquesne University reserves the right, at its sole discretion, to amend this Plan in whole or in part at any time and from time to time, or to terminate it at any time, without advance notice pursuant to the terms of the plan document. Amendments to the plan are made by the Office of Human Resource Management with the approval of the Vice President for Management and Business. Termination of the plan must be approved by the Vice President for Management and Business and approved by the Executive Committee of the University Board of Directors.