SHBP Announces Changes in Eligibility Requirements

 

November 2013

 

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Changes in eligibility for the Seafarers Health and Benefits Plan (SHBP) are on the horizon, and SIU and SHBP officials are working to make sure members understand how those changes affect them.

 

Through a letter directed to all SHBP participants, public presentations and one-on-one question-and-answer sessions, officials are getting the word out about what the new eligibility requirements mean to members and what’s needed to obtain and maintain coverage. Set to go into effect on Jan. 1, the new rules were created to comply with requirements tied to the Affordable Care Act of 2010 (known also as ObamaCare).

 

SIU Secretary-Treasurer David Heindel, who gave a presentation on the new requirements following the October membership meeting at the union-affiliated Paul Hall Center for Maritime Training and Education (PHC) in Piney Point, Md., said members would ultimately benefit from the changes.

 

“This allows you to obtain eligibility much faster. That’s what it boils down to,” Heindel said during his presentation. “It’s definitely a positive.”

 

Under these rules, new members and those re-establishing eligibility require less time to qualify for coverage. Eligibility for existing members will be divided into two six-month periods instead of over the entire year; children between the ages of 18 and 26 will be covered; and coverage limits will be removed.

 

Heindel’s presentation and a letter from Seafarers Plans Administrator Maggie Bowen delved into what the new requirements meant in specific circumstances. Following is a breakdown of how the new rules work for certain members and situations.

 

Initial Eligibility

New employees and those seeking to re-establish eligibility will now require 90 days of “continuous” employment to become eligible for benefits, instead of the 125 days of employment required under the old policy.

 

According to Bowen, “employment is considered to be ‘continuous’ if there is a break of less than 90 days between jobs. Only days of employment for a company that is required to make contributions to the SHBP on the employee’s behalf count for determining eligibility.”

 

That means those returning to work after an absence could start receiving benefits much faster.

 

Maintaining Eligibility

Under the new rules, employees must work 60 days over a six-month period to receive benefits during the next six-month period. The first period runs Jan.1-June 30, while the second period runs July 1-Dec.31.

 

“This means that if you have 60 days of covered employment any time between January 1 and June 30, 2014, you will be eligible for coverage from July 1 to December 31, 2014,” Bowen wrote. “Covered employment may also include certain time when an employee attends upgrading classes at the Seafarers Harry Lundberg School of Seamanship (SHLSS), and certain time when an employee receives sickness and accident benefits.”

 

During his presentation, Heindel said it’s also important to remember that the 90 days required to obtain the benefits in the first place also worked toward maintaining them in the following eligibility period.

 

“Because you worked 90 days you would be eligible immediately (for coverage over the next six months),” Heindel said. “You met (and exceeded) the 60-day requirement and would be covered in the next period.”

 

Pensioners

There are no changes to the number of days needed to qualify for a pension.

 

Like before, those retiring on disability pensions must have at least 4,380 days of covered employment to receive health benefits. Those retiring on any other type of pension require at least 5,475 days of covered employment to receive health benefits as a pensioner. In addition, employees must have 125 days of work in the year prior to retirement.

 

Those retiring after Jan. 1, 2015 will need to meet new medical requirements prior to applying for pension, as described in the next paragraph.

 

“You will need to have at least 60 days of covered employment in the two consecutive six-month periods prior to the date on which you become eligible for and apply for a pension,” Bowen wrote. “For example, if you retire in August 2015, you would need 60 days of covered employment from the period from July through December 2014 and January through June 2015 in order to be eligible for pensioner’s health benefits.”

 

Other Changes

Other changes to the SHBP beginning in 2014 include: coverage of children up to age 26, coverage for those with pre-existing conditions, and the elimination of annual limits on certain essential health benefits.

 

Moreover, as noted in the letter (which in addition to being mailed is posted on the SIU website), there will be a transition period “so that no [Seafarer] will be adversely affected by this new rule. During the first six months of 2014, the old eligibility rule will apply. This means that from January 1, 2014 through June 30, 2014, you will be eligible for benefits if you had 125 days of covered employment in 2013, and one day of covered employment in the past six months. However, if you did not have eligibility under the old rule at the beginning of the year, you will be able to establish eligibility after 90 days under the new rule for re-establishing eligibility. Beginning on July 1, 2014, you will only be eligible for benefits if you meet one of the new eligibility rules.”

 

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