With a HCRA, you apply for reimbursement of eligible health care expenses. Eligible reimbursable expenses are those that the IRS considers tax-deductible and are highlighted in this list.
You can get reimbursed for expenses that you, your spouse and your dependent children up to age 27 incur.
You can also get reimbursed for health insurance premiums you make as a retiree to a private insurance carrier or to a Sheet Metal Workers International Association (SMWIA) local union welfare fund.
Reimbursements are deposited to your bank account tax-free.
In order to qualify for the HCRA benefit, you must:
- Stop work with all SASMI employers on or after January 1, 2010, including total and permanent disability; and
- Be eligible and receiving a Sheet Metal Pension with 10 or more years of service of eligible for and receiving a normal retirement, with five (5) or more years of service; and
- Be eligible for and receiving a pension from the Sheet Metal Workers National Pension Fund or another SMART Local Union Pension Fund.
The calculation of your HCRA at retirement takes into account the contributions paid over your career by your employers and multiplies those contributions that were paid by a percentage based on your years of Future Service Credit and Past Service Credit.
Your HCRA calculation is based on 100% of the contributions received from the your employer—from day one.
If you are a retiree who was active in 2023, your initial HCRA account will be calculated like this:
Step 1. Multiply your years of Future Service Credit by 1.67 (0.8535/Stabilization Period) to get the additional multiplier %. Note that the additional multiplier is capped at 50%.
- 10 years of Future Service Credit will be an additional multiplier of 16.7%
- 20.5 years of Future Service Credit will be an additional multiplier of 34.235%
- 35 years of Future Service Credit will be an additional multiplier of 50%
Step 2. Add the additional multiplier % to the starting 100% of contributions to get the final multiplier. For example:
- 10 years of Future Service Credit has a multiplier of 16.7% and a final multiplier of 116.7%
- 20.5 years of Future Service Credit has a multiplier of 34.235% and a final multiplier of 134.235%
- 35 years of Future Service Credit has a multiplier of 50% and a final multiplier of 150%
Step 3. Multiply the total contributions (minus contributions to HCRA Plan B) by the final multiplier.
Step 4. Subtract any Active Benefits you’ve been paid (excluding non-deduct benefits).
To find out more, watch a replay of the June 2023 webinar.
Refer to the “I’m Retired” section for more information on how the HCRA works and how benefit amounts are calculated. You can also see the Summary Plan Description for full details.