2023 - 2026 SCLEMA Memorandum of Understanding: Article 6: Medical Benefits for Future Retirees

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What’s on this Page

• 6.1 Retiree Medical Coverage
• 6.2 County Contribution toward Retiree Medical Plans – Employees Hired Before January 1, 2009
• 6.3 County Contribution toward Retiree Medical Plans – Employees Hired On or After January 1, 2009
• 6.4 Surviving Dependent – County Contribution for Employees Hired Before January 1, 2009
• 6.5 Additional Retiree HRA – Eligibility
  • 6.5.1 Additional Retiree HRA – Biweekly Contribution
  • 6.5.2 Additional Retiree HRA – Access to Account Balance, Survivors, and Forfeiture
  • 6.5.3 County HRA Contribution – Full Obligation
  • 6.5.4 Additional HRA – Determination of Intent
  • 6.5.5 Waiver

Read Next: Article 7: Hours of Work

Eligible retirees and eligible dependent(s) (as defined below), may be, but not required to enroll in a County offered medical plan as described in Section 6.2 Retirees who enroll in a County offered medical plan are allowed only to enroll either as a subscriber in a County offered medical, dental, vision plan or, as the dependent spouse/domestic partner of another eligible County employee / retiree, but not both. If a retiree is also eligible to cover their dependent child / children, each child will be allowed to enroll as a dependent on only one employee or retirees’ plan (i.e., a retiree and his or her dependents cannot be covered by more than one County-offered health plan). All retirees and eligible dependents who enroll in a County offered medical plan are responsible for all costs including medical plan and Medicare Part B premiums.

An eligible dependent is (as defined in each plan document / summary plan description):

• Either the retiree’s spouse or registered domestic partner; or
• A child based on your plan’s age limits or a disabled dependent child regardless of age.
• Upon the death of an eligible retiree, an eligible surviving dependent who was either enrolled in, or waived coverage at the time of the retiree’s death.

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1. Eligibility
   In order to be eligible for this benefit, the retiree must have:
   1. Completed at least 10 years of consecutive regular full-time paid County of Sonoma service employment. The equivalent worked or purchased regular part-time County service time can be counted toward the ten (10) years. However, any miscellaneous purchased service time such as Extra Help, contract, and leave of absence service time does not count toward this eligibility requirement, and
   2. Have been a contributing member of the Sonoma County Employees’ Retirement Association (SCERA) for the same time period, and
   3. Retire directly from Sonoma County service.
   4. Laid-Off & Restored Employees. Employees who were employed by the County prior to January 1, 2009, but who were laid off thereafter shall be eligible for the benefits described in Article 6.2 (County Contribution toward Retiree Medical Plans - Employees Hired Before January 1, 2009), provided that they are subsequently restored to County employment, pursuant to Civil Service Rule 11.4, rejoin the County retirement system, and are otherwise eligible for retiree medical benefits under this Section. The break in service caused by the layoff shall be bridged upon restoration such that, although no service time is earned during the break, consecutive service is restored for eligibility for this benefit.
2. County Contribution
   Effective upon adoption of the MOU extension by the Board of Supervisors, for future retirees who meet the eligibility criteria in Article 6.2.A above, the County will contribute $500 per month into the Retiree Health Reimbursement Account (Retiree HRA), commencing upon the first month of the employee’s retirement date.

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For employees hired on or after January 1, 2009, the County shall contribute to a Defined Contribution retiree medical benefit plan for each eligible employee in the form of a deposit into a Health Reimbursement Arrangement (HRA) account, as described below. Any eligible retiree and eligible dependent(s), as defined below, may enroll in a County offered medical plan, but the retiree is responsible for all costs (including County offered retiree medical plan and Medicare Part B premiums).

1. Eligibility
   1. An employee must have been a contributing member (or a contribution was made on their behalf) of the Sonoma County Employees’ Retirement Association (SCERA) for the eligibility period described below.
   2. Regular full-time employees and part-time employees in an allocated position of 0.5 full-time equivalent or greater, hired on or after January 1, 2009 are eligible to receive a County HRA contribution, if they have completed two (2) full years of consecutive Sonoma County regular service (excluding overtime) in paid status.
   3. If an employee separates employment before meeting the eligibility requirement, the employee shall receive no benefit.
   4. Laid-Off & Restored Employees. Employees who were employed by the County on or after January 1, 2009, but who were laid off thereafter shall be eligible for the benefits described in Article 6.3 (County Contribution toward Retiree Medical Plans - Employees Hired On or After January 1, 2009 - Effective January 1, 2009), provided that they are subsequently restored to County employment, pursuant to Civil Service Rule 11.4, rejoin the County retirement system, and are otherwise eligible for retiree medical benefits under this section. The break in service caused by the layoff shall be bridged upon restoration such that, although no service time is earned during the break, consecutive service is restored for eligibility for this benefit.
2. County Contribution
   1. Initial County Contribution
      1. On the first pay date following completion of the eligibility requirements, regular full-time employees shall receive a lump sum contribution of $2,400 deposited into an HRA account established in their name. Thereafter contributions will be made each pay period based on the actual hours worked during that pay period.
      2. The lump sum contribution amount for regular part-time employees shall be pro-rated based on their allocated position only (e.g., a regular employee in a 0.5 full-time equivalent allocated position will receive a lump sum contribution of $1,200 deposited into their HRA account).
   2. Regular County Contribution  
      After the initial contribution (defined above) is made, the County shall contribute $0.58 per paid status hour (no more than 80 hours biweekly), not including overtime, for each eligible employee. For a full time employee, this equates to approximately $100 per month or $1,200 per year, after the initial eligibility period is met.
   3. Access to Account Balance
      1. Participants may access the balance in their Retiree HRA account upon termination of employment and attainment of age 50 or retirement from the Sonoma County Retirement System, whichever is earlier.
      2. Participants may defer accessing the account balance to any time beyond the earliest date described in (a).
      3. Amounts that remain in the account balance are available to reimburse the participant for the same permitted medical expenses for the spouse and any other eligible dependents, however, federal regulations do not permit the inclusion of expenses for domestic partners.
   4. Survivors of Eligible Retirees With Account Balances
      1. Spouses and eligible dependent children or dependent adults that are disabled may continue to access account balances after the death of the retiree.  
      2. Domestic partners are not permitted access to the account balances of the participant by virtue of restriction in the federal regulations that govern these types of accounts.
   5. Forfeiture of Account Balance
      1. If an active employee dies prior to retirement, the amount of account balance is available to participating spouses and dependents to reimburse them for medical expenses permitted under the relevant section of the Internal Revenue Code.
      2. Account balances in part or in total for active participants or retirees without any eligible spouse or dependent or unused account balances after the death of the last eligible spouse or dependent will be forfeited and returned to all other active and retired participants in the form of a dividend allocated in direct proportion to the amount to be distributed divided by the total account balance for all participants applied to each individual account balance. These distributions will occur within 120 days after the annual certified audit of the plan is submitted to the administrator and the County.  
   
   This benefit will be subject to regulation under section 105(b) of the Internal Revenue Code and subject to revenue rulings for these types of plans as promulgated.

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Upon the death of a retiree, the County will continue to pay the County’s Retiree HRA contribution to:

One eligible surviving dependent if the surviving dependent has been an eligible dependent of a retiree who was eligible to receive a Retiree HRA contribution under Section 6.2 B. prior to the death of the retiree.

This benefit will be subject to regulation under Section 105(b) of the Internal Revenue Code and subject to revenue rulings for these types of plans as promulgated.

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1. An employee must be a contributing member (or a contribution is made on their behalf) of the Sonoma County Employees’ Retirement Association (SCERA).
2. Regular full-time employees and part-time employees in an allocated position of 0.5 full-time equivalent or greater are eligible to receive a County HRA contribution.

6.5.1 Additional Retiree HRA - Biweekly Contribution

For each eligible employee in paid status, the County shall contribute twenty-five dollars ($25) each pay period into each employee’s individual HRA account.

6.5.2 Additional Retiree HRA - Access to Account Balance, Survivors, and Forfeiture

Parameters for the HRA including access to the HRA account balance, survivors of eligible retirees with account balances, and forfeiture of account balance in the event an active employee dies prior to retirement are as described in the Retiree HRA Plan Document.

6.5.3 County HRA Contribution – Full Obligation

For Bargaining Unit members hired before January 1, 2009, the County contributions to the Retiree HRA account described in Article 6.2, and the Additional County contribution to the Retiree HRA as described in 6.5.1, constitute the County’s entire obligation towards medical benefits upon termination and/or retirement and the parties agree that no other retiree medical benefits exist.

For Bargaining Unit members hired on or after January 1, 2009, the County contributions to the employee’s County HRA account described in Article 6.3, combined with the County contribution to the HRA as described in 6.6.1, constitute the County’s entire obligation towards medical benefits upon termination and/or retirement and the parties agree that no other retiree medical benefits exist.

6.5.4 Additional HRA – Determination of Intent

In the event that any court, arbitrator, administrative agency, or other tribunal of competent jurisdiction determines that any of the contributions described in Article 6.5.1 are to be included in calculating the County’s contribution toward retiree medical insurance for any retiree(s), then the contributions described in Article 6.5.1 shall be held in abeyance and the parties shall meet and confer on the matter to preserve the intent of the parties in an attempt to reach an agreement to preserve the benefits negotiated in Article 6.6.1.

6.5.5 Waiver

In consideration for the benefits provided in Article 6.5, the Union on behalf of itself and its current members / survivors as of Board adoption, waives any cause of action based on County conduct regarding retiree medical benefits from April 1, 2007 through date of adoption by the BOS of the SCLEMA MOU. Unless compelled by operation of law, the Union further agrees it will not initiate, financially support, or participate in any grievances, claims, demands, or suits against the County resulting from or in connection with the matters described herein.

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