Becoming a Vestee
A vestee is someone who meets the requirements for retirement from NYS and leaves state service but cannot yet collect their pension.
If you stop working before you become pension-eligible and meet the service and active coverage requirements, you can enroll as a NYSHIP vestee. This lets you keep your NYSHIP coverage until you can collect a pension and qualify for retiree coverage.
To qualify for NYSHIP vestee coverage, you must:
- Meet the minimum service requirement. This is usually after 10 years of service or through work-related disability retirement.
- Be pension-eligible and vest your retirement allowance. This means that you are eligible to collect a pension at a later date. This depends on your union, tier, or disability retirement.
If you qualify for vestee coverage, you will receive an application in the mail from the Employee Benefits Division (EBD). You must return the completed form within 60 days of receiving it or lose eligibility.
Once you are a vestee, EBD will become your new health benefits administrator (HBA).
Coverage
As a vestee, you are responsible for the full monthly premium; there is no employer contribution. Vestees follow the same Medicare and plan option rules as retirees.
If you end vestee coverage early through cancellation, by missing payments or not meeting Medicare enrollment requirements, you cannot reapply. You can only regain NYSHIP coverage by returning to State service or as an eligible dependent.
Note on Sick Leave Credit
When you become a vestee, you permanently forfeit your sick leave credit and may not apply it toward premium costs.
From Vestee to Retiree
To qualify for NYSHIP retiree coverage, a vestee must have active NYSHIP coverage when you start collecting your pension. If your vestee coverage lapses, even one day before reaching pension eligibility, you will be ineligible for retiree benefits.
When you reach the age of pension eligibility, your active vestee coverage will automatically convert to retiree coverage. You will return to paying only the employee share of the NYSHIP premium.
Continuous Vestee Coverage Example:
You are 52 years old. Because you have worked for the State for 12 years, you may leave payroll and enroll in vestee coverage. If your NYSHIP vestee coverage continues uninterrupted, you will automatically become a NYSHIP retiree at 55.
Disrupted Vestee Coverage Example:
You enroll in vestee coverage but miss your premium payments, causing your coverage to be cancelled two days before your 55th birthday. Because your vestee coverage lapsed, you are now ineligible for retiree coverage.