In the public sector, retirement eligibility often comes sooner than the private workforce. As an example, Police & Firefighters are generally eligible for retirement between ages 50-55, while other public employees retire around 55. The ability to retire before Medicare benefits often for post-employment medical expenses. As a result of this gap, many public employees remain on the job long past medical eligibility simply because they can’t afford to pay healthcare premiums and medical expenses out of their pocket.

The Solution

One way for public sector employers and employees to address the issue of providing post-employment medical benefits is through a Voluntary Employees Beneficiary Association (VEBA) trust, qualified under Section 501(c )(9 ) of the Internal Revenue Code. Often established as part of a collective bargaining agreement or personnel policy, a VEBA trust may be structured to allow employers to contribute tax-free dollars on behalf of their employees.

Once employees retire or separate from service, they can then access their account on a tax-free basis to provide reimbursement of out-of-pocket medical and insurance expenses. The employee’s can be used to provide reimbursement for themselves, their spouses, and taxable dependents.

Planning, Implementation, and Management

Through a multidisciplinary team of trust attorneys, third part administration, financial custodians and managers, and labor negotiators – FireLife will oversee the development of an IRS approved trust for your employee group/union.

We also provide onsite employee group education, written literature, monthly statements, and annual audits for accountability purposes.

Contact now for additional information.