April 6, 2017

Did You Know? - March, 2017 - Sick Leave

This month I would like to provide more information about your Sick Leave Benefits upon or looking forward to retirement.

IT IS NEVER TOO EARLY OR LATE TO BE INFORMED AND PLAN.

DID YOU KNOW: Upon retirement your accumulated sick leave will be converted to a dollar value by your benefits administrator and certified to Employee Trust Funds (ETF). These sick leave conversion dollars can only be used to pay for the state health plan, either as your primary plan or as a supplemental plan to Medicare after age 65. If you plan to retire earlier than age 65, many times these credits can be enough, or more, than what is needed to cover you for health insurance until you are Medicare eligible.

Here is an example:

*Jane is an annual employee(12 month pay). She is 60, has a salary of $50K, accumulated 2000 hours of sick leave and 25 years of service at UW-Superior. Jane wants to have an early retirement on May 1, 2017, she carries a single Group Health of Eau Claire health plan and her annuity options are comfortable for her current and future financial needs. Her concern is the high cost of insurance for 5 years before she is eligible for Medicare a age 65.

  • 50K yearly salary divided by 2088 work hours=$23.95 hourly rate
  • $23.95 hourly rate multiplied accrued sick leave hours of 2000=$47,900 Accumulated Sick Leave Conversion Credits(ASLCC)
  • 25 years of service would be granted 1352 SHICC hours. 1352 multiplied by $23.95 hourly rate =$32,380 Supplemental Health Insurance Conversion Credits(SHICC)
  • Sick credits of $47,900 + SHICC $32,380 = $80,280 total dollars to use for Health Insurance coverage
  • A single retiree Group Health of Eau Claire Plan w/dental, not under Medicare(Under age 65), is$786.56 per month (2017 rate). Jane is age 60 and 5 years away from Medicare age 65. $786.56 multiplied by 5 years (60 Months)= $47,196.60. If Jane retired at age 60 she would maintain her health insurance till age 65 and would have an additional $33,083.40 dollars to continue the health plan as a supplement to Medicare for years to come.

In this scenario, Jane can open the door to retirement and not have to worry about health insurance as part of her early retirement plans!

DID YOU KNOW: You can use your Accumulated Sick Leave Conversion Credits (ASLCC) to pay only for your state health plan coverage after retirement. Run your own estimate. To run an estimate you will need the following information. View more information about ASLCC and SHICC.

DID YOU KNOW: You are eligible for Supplemental Health Insurance Conversion Credits (SHICC) when you have 15+ years of continuous service.

DID YOU KNOW: If you “resign” not “retire” and have 20+ years of credible service, you can escrow your sick leave (also SHICC if at least 15 consecutive years with the UW) for a future retirement. If you “resign” not “retire” and do not have 20+ years of service, your sick leave credits may be lost. View more information about SHICC.

DID YOU KNOW: You can run your own retirement annuity estimate. Be sure to have your most recent ETF annual Benefits Statement from the Portal to do future projections(s).

DID YOU KNOW: Have you asked yourself…What is Medicare? When do I have to have coverage? What is covered and what are the costs? If so, you can learn more about Medicare.

DID YOU KNOW: You can also learn more about Social Security in regards to your personal benefits.

Please visit the ETF website for more information regarding retirement.

Your Human Resources professionals are here to help when you have questions.

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