Retirement and Resignation Season: Health Insurance Options for School District Employees
Director of Education & Government Practice
It’s that time of the year, when resignation and retirement notices are hitting your HR team’s desk at an increased rate. Employees are reaching milestones and considering the next steps in their careers. For school districts and their employees, this could cause concerns regarding transitioning employee benefits coverages, and how to best protect the financial resources of the district, as well as provide the best counsel to your employees.
If your school district is equipped with trusted resources, you can better educate and assist staff with their insurance decisions during their next career steps.
Insurance Options for Retiring Employees
As a school district, it’s crucial to strategically plan for employee retirement. When retirees leave the workforce, they may have the option to stay on their district’s health insurance plan. This can have a hefty financial impact on districts, especially those with limited funding.
It’s important to be aware that your employees’ benefits needs may change as they enter retirement. They may want to explore different networks or plan designs that better fit their new lifestyle. Specialists can help them consider a wider array of options than the plans that are currently available to them through their district’s offerings. By providing accessible educational opportunities regarding alternatives to district funded health insurance plans, your district can empower employees and protect your budget.
Alternatives to the district’s health insurance
Utilize a trusted source to vet different individual coverage options as an alternative for retirees. Remember to clarify that your district doesn’t directly provide this alternative option, but can offer education on this topic and point them in the right direction.
Medicare is another alternative option to the district’s health insurance coverage. It’s essential that your district provides Medicare education for all age groups, not just employees who are 65 years of age or older, so individuals can prepare and evaluate their options when transiting to retirement. Hosting Medicare education sessions will instill confidence and equip employees with the knowledge to fully understand their options. These sessions will allow employees to learn about appropriate coverage based on their individual needs.
Insurance Options for Employees Who Resign
As teachers and school staff resign from the district, most employees will have the option to claim COBRA for their health insurance before finding a new job. When accessing benefits through COBRA, employees pay the full premium of the coverage which is quite costly. Additionally, their claims experience continues to impact the district while they are on COBRA.
Alternative to COBRA
If districts can refer individuals to a trusted advisor to discuss individual plan options, this can reduce the chance of needing COBRA coverage. Clarify that the district doesn’t directly provide this alternative option, however can guide them to a trusted advisor.
Similar to retirement, it’s important for districts to showcase alternative options, outside of the district, that can meet their needs while transitioning jobs. If individuals who resign are given education opportunities and connected to trusted advisors, they are less likely to rely on COBRA coverage.
Key Takeaways
- District employees should be aware of all of their health insurance options when they retire or resign
- If districts provide education and trusted resources of alternative health insurance options, outside of district funded options, this can save money for both the district and the employee while empowering employees
If your district would like further guidance on this topic, reach out to Bec Kurzynske, Director of Education and Government at M3 Insurance.
