SB 946 Prescription Drug Coverage for State Retirees Eligible for a Prescription Drug Benefit Plan Under Medicare – DBM Update

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The Maryland General Assembly passed Senate Bill 946 in the 2019 Session. This bill provides for the following new programs for State retirees eligible for a prescription drug benefit plan under Medicare in the event the outcome of Fitch v. State of Maryland is found in favor of the State. Plaintiffs in that case are asking the court to maintain the State’s current prescription drug benefits available to this group of retirees. 

PLEASE NOTE THAT THE EARLIEST THESE NEW PROGRAMS COULD BE IMPLEMENTED IS JANUARY 1, 2021. YOU WILL CONTINUE TO BE ABLE TO PARTICIPATE IN THE CURRENT PRESCRIPTION DRUG COVERAGE PLAN WHILE THE FITCH V. STATE OF MARYLAND LAWSUIT IS BEING ADJUDICATED.

The Department of Budget and Management is providing the following clarifications regarding eligibility requirements for the various prescription drug programs created by Senate Bill 946. Employees may continue to work through December 31, 2019, before retiring in order to be eligible for the Maryland State Retiree Prescription Drug Coverage Program.

Maryland State Retiree Prescription Drug Coverage Program

  • Ended State service on or before 12/31/19 and retired on or before 1/1/20
  • Must enroll in a prescription drug benefit plan under Medicare at the time of enrollment in the Maryland State Retiree Prescription Drug Coverage Program
  • Must qualify to enroll and participate in the health insurance benefit options established under the State Employee and Retiree Health and Welfare Benefits Program in accordance with §2-508 or §2-509 of the State Personnel and Pensions Article
  • Reimbursement for out of pocket expenses over $1,500 for retiree only/$2,000 for retiree and family

Maryland State Retiree Catastrophic Prescription Drug Assistance Plan

  • Hired on or before 6/30/11, ended State Service on or after 1/1/20, and retired after 1/1/20
  • Must enroll in a prescription drug benefit plan under Medicare at the time of enrollment in the Maryland State Retiree Catastrophic Prescription Drug Assistance Program
  • Must qualify to enroll and participate in the health insurance benefit options established under the State Employee and Retiree Health and Welfare Benefits Program in accordance with §2-508 or §2-509 of the State Personnel and Pensions Article
  • Reimbursement for out of pocket expenses once the individual reaches the catastrophic phase of a prescription drug benefit plan under Medicare

Maryland State Retiree Life-Sustaining Prescription Drug Assistance Program

  • Applies automatically when the retiree is enrolled in either of the plans above
  • Certain prescriptions covered by State's employee prescription drug plan and not covered by Medicare

Ending State service on or before December 31, 2019 and retiring on or before January 1, 2020 will impact only what new program you qualify for; if the State prevails in Fitch v. State of Maryland you still will have to enroll in a prescription drug benefit plan under Medicare in order to have prescription drug coverage. Ending State service on or before December 31, 2019 and retiring on or before January 1, 2020 does NOT mean that you get to keep the current retiree prescription drug plan. ​​​​​
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IMPORTANT INFORMATION TO RETIRE WITH AN EFFECTIVE DATE OF RETIREMENT OF JANUARY 1, 2020

​To retire on January 1, 2020:

1.    You must separate from all employment with any participating employer on or before 12/31/2019; and
2.    The Retirement Agency must receive your properly completed retirement application package on or before January 31, 2020.​

It is recommended that before you retire :​​

1.    You submit to the Retirement Agency an Application for an Estimate of Service Retirement Allowance as soon as possible.

Please note that it typically takes 3 – 4 weeks between the Retirement Agency’s receipt of your estimate application and your receipt, via the mail, of your Notice of Retirement Allowance Estimate. Therefore, it is important that you submit your estimate request to the Retirement Agency as soon as possible. You can obtain the Application for an Estimate of Service Retirement Allowance from the Retirement Coordinator at your employer or it can be downloaded from the Retirement Agency’s website at www.sra.maryland.gov.

2.    You should carefully review all of the retirement allowance options on your Notice of Retirement Allowance Estimate and determine which best meets your financial needs, including health insurance coverages for you and your eligible beneficiary.

 

Your properly completed retirement application package includes:

1.    An Application for Service Retirement;

Please note that the Retirement Coordinator at your employer must complete several items on the Application for Service Retirement. Therefore, it is important that you not wait until the last minute to meet with your Retirement Coordinator. Your properly completed retirement application package must be received by the Retirement Agency on or before January 31, 2020.

2.    Direct Deposit – Electronic Funds Transfer Sign-up Form;

3.    Federal and Maryland State Tax Withholding Request form; and

4.    A proof of birth date document for your beneficiary if you elected retirement allowance option 2, 3, 5, or 6.

 

If you have retirement questions, you may make an appointment to see or talk to a specialist. Visit the Agency’s website at sra.maryland.gov, or call 410-625-5555 or 

1-800-492-5909 to speak to a representative or make an appointment.


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