Employers: Pending Retirement
Pending Retirement occurs when an Employer terminates an Active Member due to retirement and SHBP has not received their Retirement Record from a State Retirement System.
When Does Pending Retirement Status Begin?
An Active Member transitions to “Pending Retiree” status the first day of the month after their Active Member coverage ends with their Employer.
Example: Last Date of Deduction reported by Employer is 6/30/2020, therefore Active Member Coverage ends with Employer 7/31/2020. On 8/1/2020 Pending Retiree status begins, and Employer is no longer responsible for the Pending Retiree’s coverage.
Is Employer Responsible for Paying a Pending Retiree’s Premium?
No. The Employer is no longer responsible for a Pending Retiree’s Premium after Active Member coverage ends.
How Does a Pending Retiree Pay for Their Coverage?
SHBP places the Pending Retiree on Direct Pay status and bills him/her directly for their coverage via ADP’s subcontractor, WageWorks.
What if a Pending Retiree Has Questions About the SHBP Invoice received from ADP’s subcontractor, Wageworks?
They may contact SHBP Member Services via email at SHBPservicecenter@adp.com or via phone at 800-610-1863 and select the appropriate prompt for pre-retirement questions under the Active Member menu.
What if an Employer is Charged for a Pending Retiree’s Premium after his/her Active Member Coverage Ends?
An Employer may be charged for a number of reasons, including the most common reasons below:
- The cutoff time between Premium Billing and Vouchers being prepared for the upcoming month and the date when the Pending Retiree’s termination due to retirement record was transmitted to SHBP
- Untimely transmitting the Pending Retiree’s termination due to retirement record to SHBP
- Transmitting an incorrect record to SHBP
- Transmitting a termination due to retirement record that errors out or is rejected and then failing to take action to fix the record and retransmit it to SHBP
Will the Pending Retiree Be Removed from the Employer’s Payroll Location?
Please note the Pending Retiree will remain in the same Employer Payroll Location, but not in an Active Member status, until the earlier of:
- The State Retirement System transmits the Pending Retiree’s Retirement Record to SHBP, or
- Up to Six (6) months from the date the Pending Retiree’s Active Member coverage ends.
What happens if an Employer mistakenly transmits a termination record for an Active Member without indicating the termination is due to retirement?
The Active Member’s coverage will end the last day of the following month after the Last Date of Deduction provided by the Employer. The COBRA election packet will be mailed 7 to 10 calendar days thereafter.
Example: Last Date of Deduction reported by Employer is 6/30/2020, therefore Active Member Coverage ends with Employer 7/31/2020. COBRA Packet is mailed August 7 - August 10.
What Should an Employer Do If It Mistakenly Transmits an Incorrect Record to SHBP?
The Employer should immediately contact SHBP Employer Services to request further guidance from their dedicated Employer Services Specialist.