New value to banked sick leave

HRAs will help employees pay health care costs

TUESDAY, DECEMBER 1, 2009

If you’re a Coalition-represented employee, an innovative new benefit, the Health Reimbursement Account (HRA), will convert your banked sick leave to dollars when you terminate or retire from Kaiser Permanente—and you’ll be able to use that money to help cover the cost of qualified medical expenses, which may include premiums, co-pays and prescription drugs.

The Health Reimbursement Accounts (HRAs), which were negotiated as part of the 2008 Reopener to the 2005 National Agreement, go into effect January 1, 2010.

If you meet the eligibility requirements, Kaiser Permanente automatically will open an HRA account when you retire and “deposit” qualified unused sick leave at 80 percent of value into the account. Because the money won’t be taxed, the effective conversion rate is 100 percent of the value of your banked leave—much better than the current 50 percent cash-out rate.

Variations according to bargaining agreements

The HRA is tailored for different employee groups based on the design of individual sick leave programs negotiated during collective bargaining. Kaiser Permanente Human Resources will provide detailed information specific to those employees in the Attendance Program negotiated in 2005, employees in the Extended Sick Leave program, employees in the Northern California region with an "annual refresh" provision to their sick leave program, and employees under a paid-leave program unique to the Georgia region.

Once an HRA account has been established, you’ll be able to make “withdrawals” by submitting claims for reimbursement. There are exceptions, but generally, only premiums for Kaiser Permanente-sponsored medical plans, such as Kaiser Foundation Health Plan or Kaiser Permanente Senior Advantage, may be submitted for reimbursement through the HRA.

If you live in an area where a Kaiser Permanente medical plan is not offered, you may also be reimbursed after following specific instructions.

Employees represented by the United Food and Commercial Workers, Pharmacy, in the Southern California region may submit premiums for their medical plan regardless of residential location because this medical plan is administered through the Union Trust.

Encouraging appropriate use of sick leave

While it’s important for an employee to use sick leave when he or she is sick, the new benefit encourages and rewards the appropriate use of sick time by giving individuals the full value of their unused time. That helps ensure that employees will have sick leave available when they need it. And better attendance improves the quality of care and service while keeping costs of our Health Plan affordable for our members.