Retiree Medical Employer Contribution (RMEC) Program
Under the RMEC program, the Company's maximum contributions for retiree medical coverage are limited to a set dollar amount. The Company pays a portion of the cost of retiree medical premiums up to an annual limit.
The amount the Company contributes each month for your medical plan coverage is based on your age, the age of your spouse or domestic partner, whether or not you are covering any children and your years of credited service.
The Company shares in the cost of medical inflation until the Company contributions reach the maximum dollar limit under the RMEC. After that point, participants absorb the entire cost of premium increases because the Company's contribution is fixed.
For Non-Medicare Participants
Each year, the Company contributes an amount up to the equivalent to 65 percent of the monthly cost of the Anthem Blue Cross-administered Network Access Plan (NAP) or Comprehensive Access Plan (CAP) premiums for that year, until the amount the Company contributes reaches the maximum annual dollar limit. The actual dollar amount cannot exceed the annual maximum limits and is scaled proportionately based on your years and months of credited service.
If you are enrolled in another Company-sponsored retiree medical plan instead of the NAP or CAP, the Company will contribute the equivalent amount to the cost of your coverage, provided however, that the maximum Company contribution is no more than 72 percent of the monthly premium cost of the plan you elect. In other words, non-Medicare retirees and non-Medicare dependents must pay at least 28 percent of their monthly premium costs.
For Medicare Participants
The Company increases the base monthly contribution each year by the weighted average cost increase of all PG&E Medicare plans based on the prior year's cost experience. For 2013, the base monthly contribution is $105.16. The annual increases will continue until the amount the Company pays for Medicare retirees with 25 or more years of credited service reaches the maximum annual limit. The maximum annual limit is:
  • $2,500 per enrolled Medicare retiree, plus
  • $2,500 per enrolled Medicare spouse or registered domestic partner, plus
  • $2,500 total for enrolled Medicare-eligible children
In addition, the Company's base monthly contribution for a Medicare retiree with 10 to 25 years of credited service is scaled proportionately, from $33.66 to $105.16 in 2013, based on the Medicare retiree's years and months of credited service. Annual Company contributions cannot exceed the maximum annual limits, also scaled proportionately based on years and months of credited service.
Medicare retirees with retirement dates in 2003 or earlier who have fewer than 25 years of service will continue to receive the full base PG&E contribution, up to the annual maximum limit.
Medicare Credit for Medical Plan Members
The Company provides a direct cash credit of $15 per month for each family member who, at age 65, qualifies for Medicare, to offset the cost of the Medicare Part B premium. The $15 Medicare credit is credited on your monthly pension check for each Medicare-eligible member and is in addition to any other medical plan contribution the Company makes. For example, if you and your spouse are both age 65 or over and Medicare-eligible, you will receive two Medicare credits ($15 × 2 = $30) on your monthly pension check. If you are being billed for your monthly medical coverage, your bill is reduced by the amount of your Medicare credit. You must be a participant in a Company-sponsored plan to receive the credit. The Company will also reimburse the standard Medicare Part B premium for a disabled retiree/dependent under age 65.
For Surviving Dependents
Surviving spouses, registered domestic partners, and children are eligible for Company-sponsored medical coverage as long as they meet the eligibility criteria (see "Eligible Dependents" in this subsection). However, the Company does not contribute towards the cost, except for the $15 Medicare credit, if they are eligible to receive it (see Medicare Credit for Medical Plan Members above).
Prorated Contribution
The Company's contribution to your cost of coverage is prorated if:
  • You are under age 65 and retired with less than 25 years of credited service, or
  • You are age 65 or older and retired after 2003 with less than 25 years of credited service.
Each full year of credited service qualifies you to receive 4 percent of the appropriate Company contribution listed above. Any fractional year of credited service qualifies you for a prorated portion of another 4 percent of the contribution.