The IAFF-FC is proud to offer a post employment health care option through Nationwide Retirement Solutions. Many IAFF members have voiced concern about the ever growing cost of health care premiums during retirement. This Post Employment Health Plan (PEHP) is an employer sponsored benefit program that can assist IAFF members in paying for qualified medical expenses during retirement.
PEHP is an employee benefit to help pre-fund the future cost of health care expenses for former and retiring employees, their spouse and their dependants with tax-free dollars. The employer may elect to fund the program with either an ongoing contribution or solely contribute other types of payouts employees would normally receive in the form of a cash payment (e.g., unused sick and/or vacation leave).
The contributions, investment earnings, and reimbursements from the PEHP program (for qualified medical expenses) to former employees, their spouses, and their dependants are tax-exempt! Therefore, PEHP can save the employer payroll tax on all contributions to the program and employees will also save the matching payroll tax along with applicable state and federal income taxes.
Requirements and Benefits
Separate PEHP programs are available for collectively and non-collectively bargained employee groups.
Should the employer elect to make an ongoing contribution to the plan, the minimum funding level is $120 or 1/2 of 1% of salary per employee per year, depending on the type of account. There is no limit on how much money can be contributed into the plan.
Employees' accrued sick and/or vacation pay may solely be contributed into the plan either annually or upon retirement.
Employer saves the applicable payroll tax on all contributions made to the PEHP program.
Employees save applicable federal and state income tax as well as any matching payroll tax on all contributions, investment earnings, and distributions from the PEHP program for qualified health care expenses.
Employees may be able to afford to retire on time since they will have a tax-free PEHP account to help pay for qualified medical expenses.
For more information, please read The PEHP Story.
NOTE: Investing involves market risk, including possible loss of principal.
PEHP is a federally registered service mark of Nationwide Mutual Insurance Company
PEHP is an unregistered group annuity issued by Nationwide Life Insurance Company, contract number APO-3350.