Paying for benefits

What do I pay?

There are several costs that may apply, depending on your situation.

Note that when you enroll, you must pay premiums and applicable premium surcharges back to the date your other coverage ended. You cannot have a gap in coverage. For example, your other coverage ends in December, but you don't submit your enrollment form until February. You must pay premiums and applicable premium surcharges for January and February to enroll in PEBB retiree insurance coverage.

Monthly premiums (required)

You pay monthly premiums for:

• Medical benefits for yourself and any enrolled dependents on your account.
• Dental benefits, if you choose to enroll.
• Vision benefits, if you choose to enroll and are not enrolled in Medicare.
• Retiree term life insurance, if you are eligible and choose to enroll.

Premium surcharges (based on your situation)

In addition to your monthly medical premium, non-Medicare subscribers may be charged a $25 tobacco use premium surcharge for using tobacco products. You may also be charged a monthly $50 spouse or state-registered domestic partner coverage premium surcharge to enroll your spouse if they have other coverage available.

Out-of-pocket costs (required)

You are responsible for paying any out-of-pocket costs for deductibles, coinsurance, or copayments for services under the medical, dental, and vision plans you choose.

How do I pay?

You have three options to pay for PEBB retiree insurance coverage. In most cases, you must make your first payment by check before we can enroll you.

Making your first payment

Send your first payment to HCA no later than 45 days after your 60-day election period ends. If we do not receive your first payment by the deadline, you will not be enrolled and you may lose your right to enroll in PEBB retiree insurance coverage. In most instances, you will not be enrolled in coverage until payment is received.

Make checks payable to Health Care Authority and send to:

• Health Care Authority
  PO Box 42691
  Olympia, WA 98504-2691

Payment options

Pension deduction

Your payments are taken from your end-of-the month pension through the Department of Retirement Systems (DRS). For example, if your coverage takes effect January 1, your January 31 pension will show your deductions for January.

Important! Due to timing issues with DRS, you may receive an invoice for any premiums and applicable premium surcharges not deducted from your pension when you first enrolled. We will send you an invoice if a first payment is needed. If you receive an invoice, your payment is due by the deadline listed on it.

Automatic bank withdrawal

You can pay through automatic bank withdrawals. To choose this option, submit the PEBB Electronic Debit Service Agreement. You cannot make your first payment through EDS because approval takes six to eight weeks. In the meantime, please make payments as invoiced until you receive a letter from us with your EDS start date.

Monthly invoice

We will send you a monthly invoice after your first premium payment is made. Payments are due on the 15th of each month for that month of coverage. Send your payment to the address listed on the invoice.

Who to contact for help

If you have questions about paying any of your premiums, contact the PEBB Program at 1-800-200-1004.

Can I use a VEBA account to pay my premiums?

Yes. If you have a Voluntary Employees' Beneficiary Association (VEBA) account, you can use your funds to reimburse out-of-pocket medical expenses and retiree premiums for you, your spouse, and dependents through the end of the year they turn age 26. It is important that you notify the VEBA when your premium changes. Your VEBA account reimburses you; it does not pay your monthly premium directly to the PEBB Program.

Qualified insurance premiums include:

• Medical
• Dental
• Vision
• COBRA
• Medicare Supplement
• Medicare Part B
• Medicare Part D
• Qualified long-term care insurance (subject to annual IRS limits)

Retiree term life insurance premiums are not eligible for reimbursement from your VEBA account.

Are there limits with my VEBA?

Yes. Your VEBA account is a health reimbursement arrangement (HRA) and certain limits apply:

• Post-separation HRA: If you have a post-separation VEBA, including VEBA MEP, you must notify your VEBA plan if you are rehired by the employer (agency) who set up your account. Only certain "excepted" qualified medical care expenses and premiums (for example: out-of-pocket expenses for dental, vision, and qualified long-term care) you incur while you are reemployed are eligible for reimbursement.
• Standard HRA: If you have a standard VEBA account, no retiree-rehire limitations apply. You may be rehired by the employer (agency) that set up your account, and your VEBA account will remain fully claims-eligible.

What type of VEBA account do I have?

To find out what type of VEBA account you have, read the HRA Dashboard in your VEBA welcome packet, log in to your VEBA or HRA VEBA account, or call your VEBA plan's customer service.

What is Voluntary Employees' Beneficiary Association (VEBA)?

VEBA is a type of health reimbursement arrangement (HRA) and is authorized under Section 501(c)(9) of the Internal Revenue Code. Account balances are held in a VEBA trust.

An HRA is not an insurance plan, and you do not pay a premium. Your account is funded with contributions from your employer only, and you can start using your VEBA funds once you retire. VEBA is not a health savings account (HSA). You can have any type of medical plan and have a VEBA account.

Am I eligible to participate?

Check with your employer to confirm your eligibility. Employee groups (union and non-union) typically vote to decide whether they will participate. Eligibility criteria are usually defined in writing within a collective bargaining agreement, some other form of agreement, or employer policy.

VEBA participation is by groups

IRS laws do not allow individual employees to choose to participate or not in the VEBA program.

What are the funding sources?

HRA funding sources vary. In most cases, your employer contributes funds that would otherwise be paid to you as taxable income. For example, the most common VEBA funding source is sick leave cash out at retirement at a ratio of 1 hour for every 4 hours of sick leave (25 percent).

Check with your employer to find out what funding sources may apply to you.

What happens if I miss a payment?

You must pay the monthly premium and applicable premium surcharges for your PEBB retiree health plan coverage when due. They will be considered unpaid if one of the following occurs:

• You make no payment for 30 days past the due date.
• You make a payment, but it is less than the total due by an amount greater than an insignificant shortfall (for a definition, see related laws and rules). The remaining balance stays underpaid for 30 days past the due date.

Coverage termination

If either of these events occur and the payment remains unpaid for 60 days from the original due date, the PEBB Program will terminate your coverage back to the last day of the month for which the monthly premium and applicable premium surcharges were paid. If you were enrolled in a Medicare Advantage plan, it will terminate at the end of the month after the month your termination notice was sent. We will also terminate coverage for any enrolled dependents.

Can I reenroll?

You cannot enroll again unless you regain eligibility. You can do so, for example, by returning to work with a PEBB employing agency or School Employees Benefits Board (SEBB) organization in which you are eligible for PEBB or SEBB benefits.

Related laws and rules

• WAC 182-08-015: Definitions.