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State of Alabama

STATE EMPLOYEES’ INSURANCE BOARD

State Employees’ Health Insurance Plan

Joe N. Dickson, Chairman

William L. Ashmore, Chief Executive Officer

RETIREE NAME: ____________________________________________________________

RETIREE’S STREET ADDRESS: _______________________________________________

RETIREE’S CITY, STATE, ZIP: _________________________________________________

CONTRACT #: ____________________________

RETIREMENT DATE: ____________________________

Dear Retiree:

Act 2011-698 (SB309) changed the sliding scale calculations for employees retiring on and after January 1, 2012 as

follows:

 Employees who retire after December 31, 2011 must have at least 10 years of creditable coverage and begin

receiving a monthly retirement benefit from the RSA to be eligible to continue coverage under the State

Employees’ Health Insurance Plan (SEHIP).

 The employer contribution for employees who retire after December 31, 2011 is reduced by 4% for the years

and months of creditable coverage less than 25 and increased by 2% for the years and months over 25.

 The employer contribution for employees who retire after December 31, 2011 is reduced by 1% multiplied by the

difference between Medicare entitlement age (currently 65) and the age of the employee at retirement. Applies

until a retiree receives Medicare.

 Employees who retire on disability after December 31, 2011 and provide documentation to show they have

applied for Social Security Disability are exempt from the sliding scale years of creditable coverage calculation for

a period of 2 years and thereafter, if approved for Social Security Disability. Disability retirees after December 31,

2011 are not exempt from the sliding scale age calculation.

 Employees in DROP will not be subject to the new sliding scale calculation provided the participant does not

voluntarily terminate DROP participation within the first 3 years and withdraws from service at the end of DROP.

Employees that continue service after the end of DROP are subject to the new sliding scale calculations.

Years of creditable coverage is defined as the years and months that an employee is covered under the State

Employees’ Health Insurance Plan prior to retirement, as determined by the State Employees’ Insurance Board.

Creditable coverage shall also include: (1) military service credit purchased from the RSA, (2) part-time employment

credit in the RSA prior to October 1, 2005, and (3) employment service credit when covered by PEEHIP.

Since we may not have a complete record of your years of creditable coverage, please complete the form on the

back of this letter and return it to us within 2 weeks.

We greatly appreciate your efforts in this matter. If we can be of further service, please contact us at (334) 263-8341

or toll-free at (866) 836-9737.

200 RSA HQ • 201 South Union Street • PO Box 304900

Montgomery, Alabama 36130-4900

334.263.8341 • 866.836.9737 • Fax 334.263.8541

State Employees' Health Insurance Plan Template - State Of Alabama State Employees' Insurance Board