RETIRED MEMBERS

Keep the Fund Updated

It is important for annuitants to notify the Fund about address changes as soon as possible. Just complete a Change of Address form, sign, and return to our office via email to retirement@chipabf.org or by mail.

In addition, if you need or want to make any banking information or tax changes, the printable forms are also available on our website. All changes must be signed by the annuitant or they will not be accepted. Just complete the appropriate form, sign, and return to our office via email to retirement@chipabf.org or by mail.

Healthcare Insurance Premium Deduction

As an eligible “retired public safety officer” as defined by the IRS within the Pension Protection Act of 2006, Fund annuitants may deduct up to $3,000 per year from their taxable income for healthcare premiums paid directly from retirement assets.

At the annuitant’s request, the Fund will deduct a specified monthly healthcare insurance premium amount from the annuitant’s monthly annuity benefit, and pay such amount to a designated healthcare insurance provider as authorized by an annuitant member. The amount excluded from income is the smaller of the amount of the premiums or $3,000. It is important to note that this tax treatment is afforded only to the retired member and not a surviving spouse.

The Fund serves only as a conduit to collect and forward payment of premiums authorized by the participant from the participant’s benefit check to eligible health care plans. The authorization forms necessary to process such payment of health care premiums are available on the Forms section of the website.

If you have questions about the deduction, please contact the Fund office to discuss the Fund’s requirements for the process.

Please be advised:

1. Premium payments made by the Fund to the annuitant’s healthcare insurance provider will begin the first (1st) month after the Fund receives a fully completed and signed form, provided the completed and signed form is returned to the Fund’s office by the fifteenth (15th) of the month. Annuitants are responsible for making all premium payments to his/her healthcare insurance provider until the Fund approves and processes the completed and signed form. Incomplete and/or unsigned forms will not be processed and the annuitant will be notified they must resubmit the form prior to the Fund processing any premium payment to his/her healthcare insurance provider. Annuitants should be aware that certain Insurance carriers will not accept payments from third parties such as PABF.

2. The Northern Trust will mail the annuitant’s healthcare insurance premium directly to the designated healthcare insurance provider 5 days prior to the last business day of each month regardless of the premium due date.

3. If an annuitant’s monthly healthcare premium exceeds his/her monthly annuity benefit, the annuitant cannot participate in this process, and the annuitant is advised to contact his/her healthcare insurance provider to discuss his/her payment options.

4. Annuitants are responsible to advise the Fund in writing, of any changes in the amount of the Premiums to be paid by the fifteenth (15th) day of the month that the payment is made. Unfortunately, many Insurance companies will not provide timely premium notices directly to the Fund to allow for changes in the amount of premium to be paid.

All questions concerning eligibility or plan coverage should be directed to the health insurance plan provider.

Healthcare Subsidy Eligibility

Pursuant to Court order and current law, all eligible City of Chicago employee annuitants (both current and future employee annuitants, but not spousal or child annuitants) of the Fund are entitled to receive a health insurance premium subsidy of:

• $55 per month if the annuitant is not qualified to receive Medicare benefits; or
• $21 per month if the annuitant is qualified to receive Medicare benefits.

To be eligible:

Annuitant must have retired on or after August 23, 1989;

Annuitant must have been hired prior to June 30, 2003; and

Annuitant must participate in a group healthcare plan* for which the PABF deducts the health insurance premiums from the annuitant’s monthly annuity. All eligible subsidy payments will be included in the annuitant’s respective monthly annuity payment. If you have any questions regarding the healthcare subsidy, please contact the Fund at hcsubsidy@chipabf.org or Angela at 312-676-0417.

 

*Current group healthcare plans include: (i) the Blue Cross/Blue Shield plans sponsored by the City of Chicago; (ii) the Aetna plans sponsored by the Fraternal Order of Police Chicago Lodge 7; and (iii) the United American Insurance Co. plans sponsored by the Chicago Police Sergeants’ Association.

 

Tier 1 Annuitants Automatic Annual Increases (aka COLA)

Participants Born Before January 1, 1966

Tier 1 participants born before January 1, 1966, retiring with at least 20 years of service will receive an increase of 3% based on their originally granted annuity beginning on the later of the 1st of the month after the participant attains age 55 or, the 1st of the month after the participant has been retired at least one year. This annuity shall be increased by an additional 3% of the originally granted annuity each January 1st thereafter continuing for their lifetime.

Participants Born On or After January 1, 1966

Tier 1 participants born on or after January 1, 1966 will receive an increase of 1.5% based on their originally granted annuity beginning on the later of the 1st of the month after the participant attains age 60 or, the 1st of the month after the participant has been retired at least one year. This annuity shall be increased by an additional 1.5% of the originally granted annuity each January 1st thereafter for a maximum of 20 increases or 30%.

Tier 2 Annuitants Automatic Annual Increases (aka COLA)

The monthly annuity of a Tier 2 participant shall be increased on the January 1st occurring on or after the participant reaches age 60, or the 1st anniversary of the annuity start date. This annuity shall be increased each January 1st thereafter. Each annual increase shall be calculated at 3% or one-half of the annual unadjusted percentage increase (but not less than zero) in the consumer price index-u for the 12-month period ending with the September preceding each November 1, whichever is less, of the originally granted retirement annuity. If the annual unadjusted percentage change in the consumer price index-u decreases, then the annuity shall not be increased.