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On-going Administration of Municipal Health Insurance Benefits with the GIC

Additional information on how to administer benefits once the Municipality has joined the GIC. Allocation of responsibilities, fiscal, data exchange, operations, Commission representation and additional resource information.
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Leaving and Layoffs from State and Municipal Service

Options are listed in order of recommended selection. For all options, complete and return to your GIC Coordinator an Employment Status Change Form (Form-1A).

When your GIC coverage ends if you are leaving state or municipal service

Your coverage ends at the end of the month following the month you end state service, provided that your premium for that month is paid.

If you are leaving state service for any reason other than termination for gross misconduct, you may continue your coverage or pick up other coverage with some limitations on time and/or benefit levels. Your options are as follows:

  • COBRA health only. You have 60 days to elect COBRA coverage, but the coverage begins on the first day of the month after your coverage as an active employee ended. To avoid owing retroactive premiums, send in your COBRA application promptly to the GIC:

Benefits: Allows you to stay in the same health plan with the same benefits.
Drawbacks: You pay 100% of the premium, plus 2% for administration (no Commonwealth contribution). Maximum coverage period is 18 months.

  • 39 Week Layoff Coverage for health insurance. At the end of the 39-weeks, you may elect COBRA health coverage within 60 days for 9 additional months of health coverage, for the 18 months total health coverage permitted by COBRA.

Benefit: Allows you to keep your health and life plans with the same group benefits for 39 weeks (and the entire 18-month COBRA period).

Drawback: You pay 100% of the premium (no municipal contribution).

  • Commonwealth Health Connector health coverage (contact the Health Connector Authorityfor information and enrollment: 1.877.623.6765 ):

Benefits: A choice of health insurance options with different benefits and prices. Depending on which plan you choose, your monthly premium for the Health Connector could be lower than the monthly premium for COBRA or conversion coverage. Unlike COBRA coverage, Health Connector coverage does not have a maximum coverage period. You can continue coverage as long as you pay your premiums on time.
Drawbacks: Benefits may not be as comprehensive as the coverage you had through the GIC. If you enroll in Health Connector coverage, you are waiving your right to elect health insurance under the GIC's COBRA or conversion options. This option is only available for Massachusetts residents.

  • Convert to Non-Group health coverage with your current health plan (contact your health plan for the application):

Benefits: You can keep coverage indefinitely as long as you pay the premium.
Drawbacks: Benefits are almost always less comprehensive than GIC coverage.

For State Employees Only

  • Life Insurance Portability - You may continue your basic life and/or optional life coverage (application to continue coverage will be mailed to your home from the life insurance carrier):

Benefit: Continue your life insurance at a competitive rate.
Drawback: Does not include health insurance.

  • Convert to Non-Group life coverage with the current carrier (form available through life insurance carrier).

Benefit: Ability to continue life insurance coverage.
Drawback: Benefits almost always less than GIC plan coverage.

You may elect Deferred Retirement coverage provided you keep your money in the state or other GIC-eligible retirement system.

For state employees, if you are getting health coverage elsewhere, the GIC suggests that you, at a minimum, keep life insurance paying 100% of the premium. At retirement, you may apply for GIC health coverage; the Commonwealth will contribute its premium contribution in force at the time you retire. If you are not getting health coverage elsewhere when you leave, you may keep your basic life and health insurance, paying 100% of the premiums until retirement. 

For municipal employees, if you are not getting health coverage elsewhere, you may keep GIC health insurance, paying 100% of the premiums until retirement. If you are getting health insurance elsewhere, you may apply for GIC health coverage within 60 days of retirement; the municipality will contribute the prevailing contribution percentage for retirees. 

If you decide not to leave your money in the state or other GIC-eligible retirement system, or if it is transferred to a retirement system not eligible for GIC benefits, your eligibility for GIC benefits as a Deferred Retiree ends. You may elect to pick up health insurance through the Commonwealth Health Connector (Massachusetts residents).

How to continue GIC health coverage when you are retiring

If you have been approved and continue to receive a retirement or pension allowance from the State Board of Retirement or another participating public retirement system, you are eligible for GIC health insurance coverage. See the Retirement section for additional information.

How to cancel your coverage if you are enrolled under the COBRA Deferred Retiree provision

For State Employees, complete the Enrollment/Change Form 1 and send to the GIC. For Municipal Employees, complete the Enrollment/Change Form 1MUN and send to the GIC. Alternatively, you may send a letter to the GIC requesting that your coverage be terminated. Include your name, address, and GIC ID number (usually your Social Security Number). Coverage will be terminated at the end of the month in which your premium is paid.

Options are listed in order of recommended selection. For all options, complete and return to your GIC Coordinator an Employment Status Change Form (Form-1A).

Additional Resources

Allocation of Responsibilities for the Municipality and the GIC

What the responsibilities of the municipality and the GIC are once the municipality transfers to the GIC

The municipality is responsible for ensuring their employees, retirees, and survivors pay their share of the premium of the health plan in which they enrolled through payroll and pensions deductions, or through billing.  The municipality reconciles its monthly GIC reports and remits the enrollee and employer share of the premium, including the administrative fee, no later than the due date.  The municipality is responsible for disseminating the GIC’s communications to its employees; the GIC will send communications to the municipal retirees and survivors.  The municipality also processes and notifies the GIC of all new hire and Employment Status Change  using the GIC’s forms and procedures. 

The GIC will administer COBRA benefits, dependent age 19 to 26 status changes, retirees and covered spouses turning age 65, and the transition to a Medicare plan.  The GIC will also determine eligibility and effective dates, and will distribute Medicare Part D creditable coverage notices. The GIC will determine the effective date for all matters pertaining to insureds' and eligible dependents' health coverage, including but not limited to effective dates of coverage, termination, and status changes.  The GIC will also determine whether persons are eligible for Commission coverage, and its eligibility decisions are final and binding.

The GIC is not responsible for the bi-annual health insurance eligibility audits mandated by Section 26 of Chapter 32B

That responsibility rests with the Municipal Employer. In addition, A list of insureds (though not dependents) is sent each month as part of the municipality’s bill.  These rosters must be reconciled monthly by the municipality to identify any discrepancies between the GIC’s enrollment files and the municipality’s list of eligible enrollee to ensure billing accuracy.

However, if a Municipal Employer makes a written request to the GIC’s municipal coordinator by November 15 of a particular year, the GIC will make available to the municipality a list of current enrollees, including all dependents, on or before the following January 15.

When municipalities receive their share of the Medicare  Part D subsidy

Municipalities receive their share of the Medicare Part D subsidy after the reconciliation process, which is approximately 18 months after the Fiscal Year closes. Note that with the implementation of the EGWP program in 2016, these subsidies will be eliminated after the runout period. 

For additional details, see the GIC Municipal Health Coverage regulations.

Fiscal Costs of Municipal Health Insurance

The administrative cost for joining GIC coverage

As authorized by Section 19 and Section 23, the GIC charges an administrative fee of up to 1% of total premium per year.  This fee is determined by the GIC Commission each March as part of the fiscal year premium rates determination and is subject to change annually.  This fee pays for the GIC’s systems, operations, communications, customer service, and other services needed to accommodate and cover the Municipal Employers’ subscribers each year.

The administrative fee will be included in the Municipal Employers’ and their subscribers’ share of health premium

The law requires that the fee be included in their respective health premium rates.

Brokers’ fees are not factored into Municipal Employers’ and their subscribers’ premium contributions to GIC coverage

Since the GIC and its consultant will be performing the services that brokers perform, there will be no need for any brokers’ fees. The GIC prohibits the payment of any such fees.

What will happen if the city, town, or other political subdivision self-insures, and has a deficit in the claims trust fund at the time of transfer

If the deficit is attributable to a failure to accrue claims which had been incurred but not paid, the political subdivision may capitalize the deficit and amortize the amount over a period of not more than ten fiscal years. Only claims incurred on or after the date of transfer may be covered via the GIC. 

Data Exchange from Municipality to the GIC

Enrollment data that will be required with the Notice of Intent

The data elements required for entry into the GIC are listed in the required municipal initial enrollment data.

How to physically exchange eligibility and other forms of electronic data with the GIC

All Municipal Employers exchange data using the State's secure e-mail system (Interchange). The GIC’s Information Technology (IT) staff will provide information on how to use this process. All data exchanges will require the Municipal Employer to use the standard formats developed by the GIC for each particular file process. 

Any other technical requirements

The GIC requires that all Municipal Employers designate a technical contact in order to ensure that all data exchanges are handled in a timely and efficient manner. The GIC’s IT staff will try to assist Municipal Employers with the IT requirements.

Operations for Municipal Health Insurance through the GIC

Municipal Employers are not required to re-enroll for GIC coverage each year

Municipal Employers who join GIC coverage must remain in GIC coverage for a minimum of three years and may withdraw from GIC coverage at whole year intervals as defined in the agreement to join the GIC between the PEC + the Municipality.  These intervals may not be less than 2 yrs. For the procedure to withdraw, see the Withdrawal section.

Administrative tasks that the Municipal Employer must continue to provide once its subscribers transfer to GIC coverage

The Municipal Employer must collect and provide to the GIC all information necessary to maintain subscribers and covered dependents’ coverage. The Municipal Employer will perform administrative functions and process information as necessary to maintain the coverage, including family and personnel status changes, enrollment activities, reporting enrollee changes monthly to the GIC, and otherwise communicating with subscribers and the GIC as necessary. The GIC will provide detailed information to Municipal Employers about implementation when they submit their notice of intent to the GIC.

Effective date of GIC coverage for new hires

Eligible new hires who make timely application to join GIC coverage will be insured on the first day of the month following the earlier of 60 calendar days or two calendar months, whichever is less. The reason for the waiting period has to do with the complexities of collecting and distributing the necessary documents across a number of plans, agencies and other vendors and enable sufficient payroll and pension deductions for the enrollees’ share of premium in advance of coverage.

Municipal Employers are required to deduct the employee’s share of the health insurance premium one month in advance of the effective date of coverage or the monthly premium due date. This means that for coverage effective July 1, the employee portion of the premium must be deducted in June the preceding June.

The waiting period for new hires is never waived

However, employees without other insurance may buy back, at full cost premium, coverage beginning on the first date of employment if unplanned and urgent medical expenses occur during the waiting period, and other requirements are met.  For more information, see 805 CMR § 9.01 (4) .

Termination date of GIC coverage for employees who leave municipal service

If a municipal employee terminates employment with the municipality, coverage will end the last day of the month following the month the employee leaves municipal service.

Commission Representation for Municipalities

Municipalities have representation on the Commission

A labor representative nominated by the Mass. Teachers Association, two management representatives nominated by the Mass. Municipal Association, and a labor Representative nominated by a public safety union. 

Where to find more information about this law

Massachusetts Municipal Association

For information regarding Section 22, see Additional Resources.

Additional Resources

Contact

Phone

Main Phone (617) 727-2310

M-F 8:45 a.m.-5 p.m.

TDD/TTY 711

Online

Fax

Operations (617) 227-2681
Executive (617) 227-5181
Fiscal (617) 367-9874

Address

Street Address
19 Staniford St
Boston, MA 02114
Mailing Address
P.O. Box 8747
Boston, MA 02114
Image credits:  George Headley

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